White Collar Crime Prof Blog

Enron Broadband's CFO Pleads

A DOJ Press Release reports on Former Enron Broadband Chief Financial Officer Pleads Guilty to Falsifying Books and Records.  "According to the terms of the plea agreement, Howard faces a maximum sentence of up to 12 months of home confinement at his sentencing."  The press release states that "[i]n an attempt to generate earnings sufficient to meet the earnings target, Howard admitted that he and others at EBS structured a transaction known as 'Project Braveheart' designed to 'monetize' or book a portion of the anticipated hundreds of millions of dollars of future earnings from EBS’s agreement with Blockbuster in the fourth quarter of 2000."  But the reality is that Howard had a hung jury the first time around and a conviction vacated the next time.  Most likely the cost of trial, including the psychological cost, made this plea extremely attractive.  

See also Tom Kirdendall, Houston ClearThinkers. Chalk up Another Trial Penalty Deal;Amir Efrati, WSJ Blog, Former Enron Exec Could Get Home Confinement After Plea

Skilling Files Petition for Cert

Jeffrey Skilling filed a Petition for Certiorari to the US Supreme Court and focuses his claim on the honest services aspect of mail fraud and jury prejudice.  Clearly these are strong arguments as the Houston home court advantage was extraordinary in a case that was related to Enron and the honest services aspect of mail fraud has been a source of contention in many cases. Justice Scalia, in a recent dissent ona denial of certiorari, voiced strong opposition to the progression of mail fraud's intangible rights doctrine.  He noted the breadth in the "28 words" in the statute and concluded by stating that "it seems to me quite irresponsible to let the current chaos prevail."  It's a good move for Skilling to focus on this aspect of the statute, but the key will be whether the Court will accept certiorari in this case. Based upon a dissent in another Second Circuit en banc case, Rybicki, there are many circuits split on various aspects of the mail fraud statute. 

See also Mary Flood, Houston Chronicle, Skilling asks Supreme Court to review conviction.; Bill Mears, CNN, Former Enron CEO Files High Court Appeal; Ashby Jones, WSJ Blog, Skilling Takes Appeal to High Court

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Addendum - Adam Liptak of the NYTimes (here) reminds us, in an unrelated story of today, that "the Senate approved Justice Scalia's nomination ... by a vote of 98-to-0."

Supremes to Hear White Collar Case from Enron Broadband

The U.S. Supreme Court is set to hear oral argument tomorrow on the case of Yeager v. United States, (see here) a case that reexamines the collateral estoppel rule in a white collar context.  The question before the Court is:

"Whether, when a jury acquits a defendant on multiple counts but fails to reach a verdict on other counts that share a common element, and, after a complete review of the record, the court of appeals determines that the only rational basis for the acquittals is that an essential element of the hung counts was determined in the defendant's favor, collateral estoppel bars a retrial on the hung counts."

The defendants in the case "were tried on various counts for their actions while employed at Enron Broadband Services ("EBS"). The jury acquitted Defendants on some of these counts but hung on others, after which the United States ("Government") again indicted Defendants on some of the mistried counts." The issue is now whether collateral estoppel can apply to hung counts.

There is no question that the circuits are split on this issue and that Supreme Court guidance is needed. But a lot is at stake here in that the collateral estoppel rule, an important component of the constitutional protection against double-jeopardy,  is being tested.  Some of the questions here are: Should prosecutors be rewarded for "overcharging their cases and then failing to prove the superfluous charges?" Should courts provide legal oversight when it is clear that the law can only be interpreted one way? If the acquitted counts estop the hung counts, can a court chalk this up to jury irrationality and just permit the jury a second bite at the apple?

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Addendum - Briefs can be found on this ABA site here. (w/ a hat tip to Jack Townsend)

Skilling Asks for En Banc Hearing

Not surprisingly, Jeffrey Skilling is asking the Fifth Circuit for an en banc hearing.  He focuses on three issues, with the lead one being premised on "honest services" fraud.  The petition argues that the panel's decision is in conflict with other Fifth Circuit decisions, including U.S. v. Brown. It also raises the issue of vagueness as to section 1346.  After all - what is "honest services"?

See Ashby Jones, WSJ Blog, Skilling, Petrocelli Make Two More Pleas to the Fifth Circuit ;  Kristen Hays, Houston Chronicle, Enron’s Skilling asks full court to review convictions

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What Others Are Saying About the Skilling Decision

Doug Berman, Sentencing Law & Policy here (note that Professor Frank Bowman has a comment on the possible sentence)

Dan Slater, WSJ Blog, Skilling Conviction Upheld, Resentencing Ordered

Tom KIrkendall, Houston Clearthinkers, The Fifth Circuit rules in the Skilling appeal

Juan A. Lozano,Washington Post (AP), U.S. Court Orders Skilling Resentenced

Jef Feeley and Thom Weidlich, Bloomberg.com,  Skilling’s Conviction Upheld, Resentencing Ordered

(esp) (blogging from San Diego)

Skilling - Commentary on the Decision

The Fifth Circuit issued a 106 page opinion in the Skilling case (see here or here) - here are some thoughts on it -

• Many courts have struggled with the scope and definition of the honest services fraud statute.  Since its passage, section 1346 has caused several opinions that have attempted to provide a definition to "honest services" - a term that is undefined in the statute.  The Fifth Circuit, in a prior case - Brown had placed some restraints on prosecutions using this statute.  The Skilling decision narrows these restraints and allows more prosecutorial power in bringing an honest services fraud case. The court states:

"Therefore, it is not a matter of Skilling setting the corporation’s policy himself. Instead, the question is whether anyone who supervised Skilling specifically directed his actions—such as how Fastow sanctioned the scheme in Brown. Skilling never alleged that he engaged in his conduct at the explicit direction of anyone, and therefore he cannot avail himself of the exception from Brown."

Simplistically - will this mean that if you can blame someone else for your conduct (such as a higher-up in the corporation), this will mean the Brown exception applies, but if you are the person at the top you may be out of luck in trying to make this claim?

• The court finds - at best- harmless error in the giving of a deliberate ignorance instruction.
• The court rejects each of the claims regarding improper jury instructions.
• The court also rejects the venue claims of Skilling saying -

"It would not have been imprudent for the court to have granted Skilling’s transfer motion. The issue before us, however, is whether the court committed reversible error. It did not."

• The court rejects Skilling's claims of prosecutorial misconduct, and also rejects the Brady violation claims of the defendant.  But the court does let Skilling know that he can raise some of the Brady issues in the trial court.  So this issue may have a future. The court explicitly states:

"We find the omission of this statement from the 302s troubling. Perhaps even more troubling is that the government never disclosed the page of interview notes containing this statement to the district court. However, because the district court never had the opportunity to consider this page of interview notes, we cannot address this Brady claim for the first time on appeal. The district court did not assess the materiality of this statement or determine whether its suppression violated Brady. Thus, there is nothing for us to review. Skilling must bring this claim to the district court before we can address it."

Basically, this means that this case is far from over.

• The sentencing aspect is the biggest win for Skilling. Although the court states that it was proper to use the SEC testimony, it does reject the "four-level enhancement for substantially jeopardizing the safety and soundness of a 'financial institution.'"  What is  the definition of a "financial institution" is the question here, and the court uses the rule of lenity and sides with the defense. I await Professor Doug Berman's calculations from the Sentencing Blog, as to exactly the amount of time that this could reduce his sentence.

(esp)(blogging from San Diego)

Skilling- Sentencing Reversal and Remand; Conviction Stands

Opinion here - Download 06-20885-CR0.pdf

Commentary to follow.

(esp) (from San Diego)

Skilling Hearing - Sounds Like it Wasn't a Hot Bench

Reading the reports from those who were there, it sounds like the Skilling bench was a quiet one. But then again - a lot of the argument dealt with "honest services" under the mail fraud statute. 

The mail fraud statute is an 1872 statute that was a section in a revision of the Postal Act.  In the 1970's prosecutors extended mail fraud to prosecute cases involving "intangible rights."  In the case of McNally v. United States, the Supreme Court shot this doctrine down finding that "money or property" was required.  Congress came back with a new statute 18 U.S.C. 1346 that allowed prosecutions premised on a right to "honest services."  But the statute has been problematic in both its breadth and in the government's attempt to extend it in new ways.  The courts as seen in the Brown case, have provided limits to what might appear as a limitless statute.  But the bottom line is that this statute has numerous problems, both in its wording and in its application. And because mail fraud is difficult to understand, it is not surprising that a hearing related to this crime might prove dry.

Amit Efrati, U.S. Judges Hint at Little in  Skilling Appeals Session

Loren Steffy - Houston Chronicle Business Blog - Skilling's Appeal Opens With a Bang, Ends With a Whimper

(Houston Chronicle) AP Court Hears Appeal of Enron's Skilling

Nola.com Skilling Hearing Concludes With Smaller Audience Than Expected

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They're Expecting A Crowd for Skilling

The Fifth Circuit Court of Appeals has special instructions on its website about the Skilling oral argument set for today. For example, it states "[n]o one will be allowed to enter any of the courtrooms prior to 1:00 p.m., April 2, 2008, to allow court staff to set up additional chairs in the East Court room, and prepare other courtrooms for overflow spectators."

The case will be heard by three judges: Hon. Jerry E. Smith (Yale law grad, Reagan appointee), Edward C. Prado (Texas law grad, George W. Bush appointee), and Alia Moses Ludlum (Texas law grad, George W. Bush appointee) (see Times Picayune here).   

Some of the key issues before the court are:

• Whether there was a Brady violation in the failure of the prosecution to provide the Fastow Notes and full discovery pre-trial.
• Whether there is any reason not to follow the court's precedent in the Brown case with the prosecution's use of  the "honest services" theory.
• Whether there was error in instructions given to the jury with respect to deliberate ignorance.
• Whether it was improper to refuse instructions on materiality, reliance, and "oral side deals."
• Whether the accused was deprived of a fair trial as a result of the venue of this trial.
• Whether the accused was provided sufficient voir dire.
• Whether errors with respect to the honest services doctrine spillover to other aspects of the case.
• Whether there were sentencing errors.

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Wednesday Is Jeffrey Skilling Day

This Wednesday is the day that the Fifth Circuit will listen to arguments in the case of United States v. Skilling.  Although the briefs are filled with many arguments, the ones focused upon in the oral argument will likely be fewer in number.  That's typical, as you can't hit everything in a time-tight oral argument. 

As one looks at all of the original legal arguments and the new issues from the release of the Fastow notes, it is clear that the court will have a good bit to consider. And perhaps one item that might be lingering in some minds, is the continuing question as to  why the government didn't object to Fastow's argument for a sentence below the agreed upon terms of the plea agreement. Tom Kirkendall at Houston ClearThinkers (see here) pointed out one segment from the Skilling trial when Fastow was on redirect examination and he answered questions as follows:

Q. And what is the minimum amount of time that that plea agreement calls for?

A. It calls for a 10-year sentence.

Q. So after January 14th, can your cooperation lower that 10 years?

A. My understanding is that I will be sentenced to 10 years. The Judge ultimately has a discretion; but in my plea agreement, I agreed to the 10-year sentence."

Andy Fastow, however, received a sentence of six (6) years. This was despite a provision in the plea agreement that stated:

"The parties agree that Defendant's sentence under the Sentencing Guidelines shall include 120 months in the custody of the Bureau of Prisons.  Defendant agrees that he will not move for a downward departure from the offense level or the guideline range calculated by the Court and that no grounds for a downward departure exist."

And the government did not object.  Why?

The following are links to key posts from this blog that relate to the forthcoming argument, and the briefs that have been filed.

Government Responds to Skilling Supplemental Brief

The Skilling Discovery Problem - Part II of Commentary

The Falling of the Enron Case House of Cards

Skilling and the Fastow Notes

The Skilling Case - Stay Tuned

The Fastow Notes

Commentary on Skillings Reply Brief

Skilling's Reply Brief Arrives, Just in Time for the Holidays

The Government Weighs in on Skilling

Skilling's Fifth Circuit Brief Arrives

Also check out Larry Ribstein's Ideoblog here

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Government Responds to Skilling Supplemental Brief

Jeffrey Skilling filed a supplemental brief discussing the failure of the government to provide exculpatory material, specifically items now discovered as a result of the release of the Fastow Notes (see here, here, and here).  The government has now responded with an 83-page brief that challenges the defense position. Perhaps the paragraph that sums up the government position best is seen here -

"At trial, the government provided the district court with the rough notes underlying those 302s so that the court could monitor Fastow's testimony and disclose to Skilling any information in the notes that could be used to impeach Fastow.  Now, having obtained those notes while his conviction is on appeal, Skilling argues that they contain undisclosed exculpatory information and show that the government presented false testimony to the jury. As explained in detail below, Skillings' claims rely on isolated snippets culled from  420 pages of handwritten notes and stripped of their context.  Put in its proper context, and divorced from Skilling's hyperbolic rhetoric, each portion of the notes on which Skilling relies contains information that Skilling possessed prior to trial or that would have had minimal value in impeaching Fastow. "

So the government is claiming that the items would have "minimal value."  If that's the case, why didn't they just give them to defense counsel?  Why should we have after-the-fact discussions of whether an item was disclosed and whether it would have made a difference? When an individual is being given a sentence of 24 years, shouldn't the accused be allowed to have everything to properly present a defense to the jury?

Later in the government response they state:

"Finally, if the government had disclosed the information in the February 4, 2004 note, Skilling could not have profitably used it to impeach Fastow.  If Skilling had impeached Fastow with the note, the government would have been entitled to rehabilitate Fastow with the notes showing that on two later occasions he recalled Skilling knew of the quid pro quo."

Should the government be deciding the value of impreachment and rehabilitation evidence?  Isn't that a role we leave to juries?

See WSJ Blog here, Mary Flood's Houston Chronicle Blog here, Kristen Hays - Houston Chronicle here

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Addendum - Government's Brief -

Download usa_v. Skilling Case# 06-20885 USCA, 5th Circuit 3-25-08 Supplemental Brief by Appellee USA .pdf

(w/ a Stetson hat tip to Whitney Curtis)

In the News - Wecht, Kilpatrick, Paulson Talk, Enron

Philly.Com (AP) - Fifth Day of Deliberations End in Wecht Fraud Trial; Pittsburgh Tribune Review - Wecht Deliberations to Resume Thursday

DetroitNews.com - Mayor Kilpatrick to Get Legal Defense Funding;  Attorneys in Scandal to be Probed

ABA Journal - Ninth Circuit Bounces Judge From Case for Favoring Prosecution

Wall Street Journal - Paulson Joins Advocates of Wider Fed Oversight

AP - Citi Settles Enron Suit for $1.66 Billion

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The Nigerian Barge Case - Will It Sink?

Tom Kirkendall's Houston ClearThinkers has the Motion to Dismiss filed on behalf of a former Merrill Lynch executive who is awaiting retrial (see here). As anticipated, the Fastow Notes - and the alleged failure of the prosecution to provide exculpatory material to the defense - may prove devastating to this prosecution.  The Motion includes numerous references to the Model Rules of Professional Conduct, the ABA Standards for Criminal Justice, and the Restatement (Third) Law Governing Lawyers. Although ethics rules are usually not enforceable at law, they have been used to provide a standard for appropriate conduct in the community.  In this case, the Motion alleges many different violations of ethics rules.

The key issues for the court will likely be: 1) did the prosecution withhold exculpatory material; and 2)  what is the appropriate remedy. Both of these issues offer interesting aspects.  On the first one, a question will be whether the Enron prosecutors will be testifying or is the paper trail sufficient to present each side of the argument.  It is likely that the prosecution will vigorously argue the second issue (that a retrial cures this problem) in an attempt to avoid losing the case on a court dismissal.   But the more important question remains - why are the Fastow notes so late in coming (see here).

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The Skilling Discovery Problem - Part II of Commentary

The Wall Street Jrl just reported on the release of Skilling's Supplemental Brief and its discussion of the Fastow Notes.  As the White Collar Crime Prof Blog noted here, if prosecutors failed to provide Brady material, Jeff Skilling's conviction could be in jeopardy.  Also discussed here was the importance of full and open discovery by prosecutors.  When a prosecutor provides limited discovery, the prosecutor opens him/herself up to being accused of not giving the defense exculpatory material.

Discovery violations, if they in fact happen, can also violate ethical rules for attorneys.  The applicable rules depend on what has or has not been adopted in the particular jurisdiction.  The ABA Model Rule provides in Rule 3.8 that:

"The prosecutor in a criminal case shall: ...

(d) make timely disclosure to the defense of all evidence or information known to the prosecutor that tends to negate the guilt of the accused or mitigates the offense, and, in connection with sentencing, disclose to the defense and to the tribunal all unprivileged mitigating information known to the prosecutor, except when the prosecutor is relieved of this responsibility by a protective order of the tribunal;"

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Initial Commentary on the Skilling Supplemental Brief

Obviously, we can expect that the government will take issue with the contents of the Skilling brief (for the brief see here).  The brief even states that when questioned with a discovery issue the

"Task Force merely reverted to its blanket assertion that the 'notes are "not materially inconsistent" with information already in your possession."

But there is an important question that goes beyond the Skilling case, and even beyond the cases such as the Nigerian Barge cases, that are implicated by the Fastow notes.  That question is -- how much discovery should prosecutors give to defense counsel.

Clearly in cases where individuals can be injured, there is a need to make certain that the discovery will not result in the commission of additional crimes.  But what is oftentimes a problem seen in drug cases, is seldom a concern in a white collar case.

So why shouldn't the government give all materials to the defense in a white collar case. This is an important question and my answer would be that the government should provide complete and full discovery in white collar cases, unless they can show to a court that the release of the information will have a detrimental effect on a pending case or will be physically harmful to an individual.   And in situations when there are these possible ramifications, the court needs to find a way to allow defense counsel needed information so that the accused is not deprived of his or her due process rights.

The easiest way for the government to protect the record and case is to provide everything to defense counsel, and in some jurisdictions we find expansive discovery practices for just this reason.  Providing this information not only protects the record and the case, but also serves a judicial economy in that having the information may provide earlier pleas.  After all - if the accused sees that the evidence is there to convict him or her, there is a desire to find a lighter sentence through a plea.  On the other hand, providing selected materials opens the prosecutor to claims that exculpatory material was not disclosed.  Even the best of prosecutors, with the best of motives, may not know the direction of the defense and therefore not be able to ascertain the importance of certain documentation.  Providing everything precludes this later argument of non-disclosure, and precludes the risk of a claim of a Brady violation.   

The Skilling brief highlights the need to provide all notes, even the raw ones, to the defense pre-trial. From the prosecutor's perspective -why risk a retrial, and if you give everything the plea may add an economic benefit.  And more importantly, trials demand fairness.  The stakes are high and sending an innocent person to jail should be avoided at all costs.  The best way to prevent this from happening is to provide full and complete discovery.  The faults of the existing discovery process are not merely claims heard in death cases or ones voiced by the "Innocent Project."  The discovery process also needs to be examined in the context of white collar cases. 

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Addendum - See Austin Criminal Defense Lawyer here.

The Falling of the Enron Case House of the Cards

The first card in the falling of the government's house of Enron cases occurred yesterday, as Jeffrey Skilling's supplemental brief was unsealed. And one finds within this brief a shocking display of alleged government misconduct. The brief and some commentary can be found over at Tom Kirkendall's Houston ClearThinkers here. For openers, here is but one example of what can be found in the introduction in the brief.  Commentary on this brief will follow in later posts.

Task Force prosecutors called the "Global Galactic"document "three pages of lies" and the "most incriminating document" in Skilling’s entire case. Op.Br.196; R:36538-39. At trial, Fastow testified Skilling knew about Global Galactic because Fastow "confirmed" it with him during a spring 2001 meeting. Skilling denied knowing anything about Global Galactic. Op.Br.32-36. To bolster Fastow’s testimony and impeach Skilling’s, the Task Force introduced a set of handwritten "talking points" that Fastow said he prepared in anticipation of his meeting with Skilling. R:22287-88. At trial, Fastow swore he "went over" the talking points with Skilling, including the crucial point "Confirmation of Global Galactic list." Id. In closing, the Task Force relied heavily on this document to corroborate Fastow’s testimony that he discussed Global Galactic with Skilling. Id.

The raw notes of Fastow's interviews directly impeach Fastow's testimony and the Task Force's closing arguments.  When shown and asked about the talking-points document in his pr-trial interview, Fastow told the Task Force he "doesn't think [he] discussed list w/ JS." AE-27-381. (footnote omitted).

This obviously exculpatory statement was not included in the Task Force's "composite" Fastow 302s given to Skilling.  Nor was it included in the "Fastow Binders" the Task Force assembled for the district court's in camera review of the raw notes.

See also Houston Chronicle here.

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Addendum - Larry Ribstein's Ideoblog here; the Wall Street Jrl here

Skilling & The Fastow Notes

Kristen Hays of the Houston Chronicle's article, Skilling Seeks to Use Fastow Notes As Part of Appeal and Tom Kirkendall's Houston ClearThinkers (here) discuss the recent happenings in the Skilling appeal. If it is shown that the government failed to disclose exculpatory material to the defense in the Skilling case, it could prove enormously detrimental to the government's ability to have the conviction affirmed on appeal.  Because Andrew Fastow played a crucial role in the government's case, items within the government's possession that they may have failed to provide to defense counsel may send this case in a whole new direction. The question remains as to whether the Fastow Notes will be the card that causes the house of cards (this time the government prosecution of Enron cases) to start falling. (see here and here)

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The Skilling Case - Stay Tuned

Tom Kirkendall, over at Houston ClearThinkers, has landed on some interesting court entries in the Jeff Skilling matter. (see here) And yes, we both are wondering if this development is in some way tied into the Fastow Notes (see here).

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NatWest Three Sentenced to 37 Months and May Be Headed Back to England . . . Eventually

Three former British investment bankers for NatWest Bank who were charged for their role in helping former Enron CFO Andrew Fastow dress up the company's balance sheet were sentenced to thirty-seven month prison terms.  The so-called "NatWest Three" -- David Bermingham, Giles Darby, and Gary Mulgrew -- became a cause célèbre over their extradition from Great Britain under a new treaty between the U.S. and U.K. designed to facilitate the transfer of terrorist suspects.  The appeal went to the House of Lords, which upheld the extradition order, and the three have been living in Houston for the past two years.  Their guilty plea in November 2007 to wire fraud ended one of the few remaining cases arising from the Enron collapse.  A Houston Chronicle story (here) discusses the sentencing.

As foreign nationals, the NatWest Three will be eligible to apply to the Department of Justice's International Prisoner Transfer Program to serve their terms in Great Britain.  The DOJ website on the Program (here) notes that "[w]hen a prisoner is transferred to another country, the completion of the transferred offender's sentence is carried out in accordance with the laws and procedures of the receiving country, including those governing the reduction of the term of confinement by parole, conditional release, or otherwise."  The Chronicle article points out that in England a defendant has to serve one-half the prison term and is then released on a type of probation.  This is much less stringent than the federal sentencing law, which requires a prisoner sentenced to a term such as those given here to serve 85% of the time, i.e. about two and one-half years. 

Among the criteria considered for authorizing a prisoner transfer are acceptance of responsibility, criminal history, seriousness of the offense, and ties to the two nations.  Also considered is whether the prisoner will remain in the home country or return to the United States -- rest assured, the NatWest Three are unlikely to darken our shores again any time soon.  In addition, according to the Bureau of Prisons Policy Statement (here) on transferring foreign prisoners, the transfer cannot be authorized until the prisoner pays any outstanding fine.  In addition to the sentence in this case, U.S. District Court Judge Ewing Werlein ordered the three to repay the $7.3 million they received from the transaction that triggered the charges.  While not a fine but restitution, I suspect there won't be a transfer until that money is repaid.  Even then, the application process will take at least a few months to complete ,once they begin their prison terms, as the bureaucracy processes the requests. (ph)

Fifth Circuit Continues to Rule Against the Government - Honest Services Issue

The Fifth Circuit Court of Appeals, in a unanimous opinion written by Hon. W.  Eugene Davis, refused to accept the government claim that the case of United States v. Brown did not apply to one of the counts dismissed in the case against the former CFO of Enron Broadband. The appellee had initially been convicted of  five counts, but the court dismissed these convictions post-Brown. The district court had vacated the conviction on Count 5 because "there was a reasonable possibility that ....Count Five was indeed tethered to Count One." The government, unhappy with this decision, appealed.

The Brown court ruled that "honest services" did not apply "where an employer intentionally aligns the interests of the employee with a specific corporate goal where the employee perceives his pursuit of that goal as mutually benefiting him and his employer, and where the employer's conduct is consistent with that perception of mutual interest."  Because the jury "could have based its conviction on the tainted conspiracy charge" the district court refused to accept the government's argument that this count should be reinstated.  The Fifth Circuit agreed.

This decision is fascinating on several levels:

• A Pinkerton instruction is a powerful tool for the government as it allows them to proceed against individuals on substantive acts that they may not have been directly involved in -- acts that were foreseeable and in furtherance of the conspiracy. This may be a unique instance showing how the government can get trapped by its own stretching of statutes.  By using Pinkerton, when the conspiracy fell - it also caused the charged substantive act to fall. An after-the-fact claim of -  I really didn't mean it to apply here, does not carry much weight.  The lesson of this case is that prosecutors need to think of the ramifications of having a Pinkerton instruction if they truly believe it isn't necessary.   
• Should prosecutor's have a second chance when they stretch a statute and get caught?  How much of the taxpayer's money should they be allowed to spend?  In other words - should they be allowed to retry this count? (See Tom Kirkendall's comment on Houston ClearThinkers)
• The Fifth Circuit is very clearly saying that the Brown decision is here to stay.
• This decision may be particularly helpful to Jeff Skilling as it not only fortifies Brown, a case focused on in Skilling's appeal, but it also takes a strong position that counts within the "spill-over" of tainted counts, will not stand.

U.S. v. Howard - Download HowardAppealOpinion.wpd.pdf

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