Acquittals and Mistrial in Enron Unit Cases
By KATE MURPHY
Published: July 21, 2005
HOUSTON, July 20 - After four days of jury deliberations, a federal judge declared a mistrial on Wednesday on all but a handful of 164 counts against five former Enron executives who were accused of overstating the strength of the company's broadband services division.
The jury acquitted Joseph M. Hirko, a former chief executive of Enron Broadband, of money laundering and insider trading. F. Scott Yeager, former senior vice president for development, was acquitted of charges that included wire and securities fraud. And Rex Shelby, former senior vice president for engineering, was acquitted on charges that included insider trading.
But the jury was unable to reach a decision on other charges against the three and two other executives - Kevin Howard, former chief financial officer, or Michael Krautz, former senior accounting director. The judge declared a mistrial and the dismissed the 10-man, 2-woman jury.
As the verdicts were read, family members of the defendants began to cry, realizing that the men would not be convicted. After hearing the decision, lawyers for the defense and prosecution left the courtroom shaking their heads.
"There's no logic to this," said Edwin J. Tomko, a lawyer who represented Mr. Shelby.
Barry Pollack, who represented Mr. Krautz, said such a conclusion after more than 12 weeks of testimony "tells us something about the government's use of resources in this case and whether this case should have ever been tried."
Federal prosecutors left the courthouse without comment.
Earlier in the day, the jury had told the judge, Vanessa Gilmore of Federal District Court, three times that they were deadlocked. The judge sent the jury back to continue deliberations twice; on the third time, she realized that further deliberations would be fruitless.
The prosecutor, Cliff Stricklin, pleaded with Judge Gilmore to compel the jury to try harder to reach a verdict. But she refused.
The judge slid down in her chair and rolled her eyes as the defense and prosecution then argued whether they should be allowed to learn what had led to the split among the jury.
Judge Gilmore said that if she released that information, it would under rules that it could not be discussed, otherwise "We're going to be in Alaska trying this," referring to possibility of a retrial.
The trial, which began April 18, often became bogged down in arguments over semantics, as lawyers would quibble over the verb tenses used by defendants as they testified about the technological capabilities of the broadband network.
During the trial, prosecutors had claimed the executives had oversold the capabilities of the broadband network in order to boost the financial results and raise share prices.
The defendant claimed that they were accurately stating the capabilities of the broadband technology and were developing it into a competitive provider of high-speed networking and video-on-demand products.
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