THE DISGRACED press baron Conrad Black and the Enron fraudster Jeffrey Skilling have won fresh hope of early release from jail following a US supreme court ruling that their convictions partly relied on a controversial corruption law that was too broad in its scope.
In a major legal victory for the two jailed tycoons, America’s top court issued separate, but related, rulings declaring that the men were treated unfairly when appeal court judges threw out their attempts to overturn their convictions.
However, the rulings only shed doubt on certain aspects of the men’s multiple convictions and stops well short of acquittal.
Black (65), currently an inmate at Florida’s Coleman prison, was sentenced in 2007 to 6½ years for defrauding shareholders in his Hollinger media empire out of $6.1 million by attaching a “non-compete” clauses to the sale of newspaper businesses that siphoned off funds from investors. The Canadian-born businessman has vigorously protested his innocence from the beginning.
Skilling (56) is in a prison near Denver and is serving 24 years. He was chief executive of Enron until shortly before the energy trading company imploded in one of the most dramatic corporate corruption scandals in US history.
In both cases, prosecutors used a law that allows for conviction if business leaders are found to have robbed investors of “honest services”. However, twin decisions written by Judge Ruth Bader Ginsburg rule that this law should only be applied to incidents of bribery and kickback schemes.
Referring to Black, the ruling concludes: “We vacate the judgment of the court of appeals and remand the case for further proceedings.”
The decision affects three counts of fraud for which Black was convicted by a Chicago jury. He still faces a hurdle in that he was also found guilty of obstructing justice by removing boxes of evidence from his Toronto office in defiance of a court order.
Once friendly with society figures ranging from Margaret Thatcher to Henry Kissinger, Black once described the case against him as hanging “like a toilet seat” around the necks of prosecutors.
His legal team has never been pleased to have its case lumped in with Skilling, even though it appealed almost simultaneously to the supreme court on the same legal grounds.
Skilling was convicted in 2006 on 19 counts of fraud, conspiracy, insider trading and lying to auditors. His co-accused, former Enron chairman Ken Lay, died of a heart attack while awaiting sentencing.
Ginsburg’s ruling, which is written on behalf of a majority of the supreme court’s 11 judges, says her decision does not necessarily mean the Enron chief’s convictions should be overturned.
