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The Trial

Fastow Presents Enron Defense with New Scenario

“It’s possible to raise conflicting defenses if the defendants don’t testify,” said Linda Eads, SMU professor of law. “But once a defendant takes the stand, he cannot testify inconsistently. He has to pick his defense.”

Eads says by not testifying, Lay and Skilling can keep to separate scenarios for their innocence. Lay can claim he was never informed about what his top executives were up to, while Skilling can claim the auditors and the lawyers signed off on the deals. Other angles Eads can discuss:

  • Defense strategy with the news media
  • Delay tactics by defense
  • Fastow’s impact on the defense

  See a sound bite.
  Hear Eads on ABC Australia Radio's "Saturday Extra with Geraldine Doogue."
 • Read The Houston Chronicle excerpt.

Skilling's attorney Mark Holscher has tried to drag out his questioning of Ken Rice, Enron's former broadband executive, but was slapped down by the judge. Studies have shown that juries look for an authoritative judge to guide them through complex financial cases. How a judge handles the attorneys and in the way he instructs the jury before deliberations are pivotal to the outcomes of fraud and other financial cases. More jury angles SMU experts can discuss:

  • Change of venue
  • Communicating the case to the jury
  • The stupidity defense
  • Representing two defendants at once

Judge Pivotal to How Jury Rules

“In white-collar criminal cases, judges have tremendous influence with the jury,” says Alan Bromberg, University Distinguished Professor of Law in SMU's Dedman School of Law. “The power comes from the way the judge phrases his instructions to the jury before deliberations. That certainly was the case with the Arthur Andersen trial.” (Read the Reuters excerpt.)

With studies showing how juries look for authoritative parties to guide them through complex cases, Bromberg (an authority himself on white-collar criminal prosecutions) says the judge in the Enron case will be pivotal to the trial’s outcome. Bromberg drafted substantial parts of the Texas corporate and securities statutes and is the author of the six-volume set Securities Fraud and Commodities. He has been teaching securities law for more than 50 years and has deep knowledge of how white-collar crimes are prosecuted. Some of the angles he can discuss:

  •  SEC investigations post-Enron
  •  Vinson and Elkins’ role
  •  Pros and cons of the Stupidity Defense
  •  Sarbanes-Oxley
  •  Change of venue