by Rigorous Intuition » Sat Jul 08, 2006 11:01 am
<!--EZCODE BOLD START--><strong><br>Lay's death could set Skilling free</strong><!--EZCODE BOLD END--><br><!--EZCODE ITALIC START--><em>Lawyers likely to argue that entire case has effectively been voided</em><!--EZCODE ITALIC END--><br><br>WASHINGTON -- Kenneth Lay's sudden death could prove to be an unexpected legal bequest to Jeffrey Skilling, his co-defendant in the landmark Enron Corp. fraud case.<br><br>Mr. Skilling's legal team will almost certainly invoke Mr. Lay's demise to try to reverse his own fraud and conspiracy conviction or demand a retrial, legal experts said yesterday.<br><br>That's because Mr. Lay's death Wednesday of an apparent heart attack <!--EZCODE BOLD START--><strong>effectively voids the entire case against the Enron founder, including the guilty verdict. Mr. Skilling, the former Enron chief executive officer who is appealing his own conviction, could now argue that much of the evidence against him stems from a case that no longer exists</strong><!--EZCODE BOLD END-->, argued lawyer Jacob Frenkel, a former federal prosecutor and white collar crime specialist.<br><br>"This is the first time this has happened in such a high profile case," Mr. Frenkel said. "Everybody is scrambling to see what the law says on this."<br><br>How it all plays out could set a legal precedent, he added.<br><br>Federal prosecutors may be stymied in their bid to seize Mr. Lay's assets. A recent appeals court ruling in the U.S. Fifth Circuit, where Mr. Skilling and Mr. Lay were tried, determined that when a defendant dies before he has exhausted all his appeals "everything associated with the case is extinguished, leaving the defendant as if he had never been indicted or convicted."<br><br>And that, Mr. Frenkel said, could arguably include any evidence used to convict Mr. Skilling.<br><br>Both men were free on bail, awaiting sentencing following their May 25 criminal conviction on fraud and conspiracy for their role in the spectacular 2001 collapse of Enron, a Houston-based energy trader.<br><br><!--EZCODE BOLD START--><strong>And in another bizarre twist</strong><!--EZCODE BOLD END-->, Mr. Lay's death is likely to shield his wife, Linda, and the couple's children from a federal forfeiture of his assets.<br><br>The U.S. Justice Department's Enron Taskforce filed a motion last week asking U.S. District Court Judge Sim Lake to force Mr. Lay to pay $43.5-million (U.S.) and Mr. Skilling to pay $139.3-million.<br><br><br><!--EZCODE LINK START--><a href="http://www.theglobeandmail.com/servlet/story/LAC.20060707.IBENRON07/TPStory/Business">www.theglobeandmail.com</a><!--EZCODE LINK END--> <p></p><i></i>