A FEDERAL appeals court in New Orleans upheld the convictions of former Enron chief executive Jeffrey Skilling but ordered Skilling to be given a new prison sentence after finding fault with a portion of the trial judge's sentencing calculation.|
The ruling likely means Skilling will see several years shaved off his current sentence of 24 years and four months, which he received after his spring 2006 conviction for crimes committed prior to and during the meltdown of energy-trading giant Enron in 2001.
In a 104-page opinion, the three-judge panel rejected arguments made by Skilling's lawyers that the Government violated his rights and prosecuted him with a flawed legal theory. The panel also disagreed that the trial judge, Sim Lake, had used wrong jury instructions and that the jury was biased.
On that latter point, the court found that although Skilling faced "community bias in the Houston area" stemming from extensive pre-trial publicity, Judge Lake's thorough jury-selection process "more than mitigated any effects of this prejudice".
"We are very disappointed in this decision," said Daniel Petrocelli, Skilling's lawyer. But Mr Petrocelli said that he planned to go "back to work and continue to fight" through the appellate process, up to the US Supreme Court, if necessary.
"Today's ruling is a victory for all those harmed by Jeff Skilling and his co-conspirators," said Matthew Friedrich, an acting assistant attorney general with the Justice Department.
"We are gratified that the court ... rejected all of Skilling's challenges to his conviction. Skilling was an architect of the crimes that caused Enron's collapse, the fallout of which is still being felt today."
In May 2006, Skilling was found guilty on 19 felony counts of conspiracy, fraud and insider trading. Kenneth Lay, the former Enron chairman, was convicted alongside Skilling. Mr Lay died from heart-related problems before filing an appeal, which vacated his conviction.
In December 2006, Skilling began serving time at a low-security federal prison in Waseca, Minn. Last year, he was moved to a facility in Littleton, Colo.
There was a silver lining for Skilling in the appeallate court’s opinion. The appellate court ruled that Judge Lake erred by increasing Skilling's sentence for "substantially jeopardising the safety and soundness" of two Enron retirement funds. The court ruled that because the funds weren't financial institutions, as specified in the federal sentencing guidelines, Judge Lake shouldn't have added to Skilling's sentence on those grounds.
"It's no small victory; they should be heartened by this," said Michael McGovern, a former federal prosecutor and current defence lawyer.
Mr McGovern said it is almost certain that, under revised calculations, Judge Lake will be faced with a sentencing range between 188 and 235 months - or roughly 15 to 19 years. Using that calculation, Skilling's sentence could be cut by as many as nine years.
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