updated 8/12/2004 11:25:17 AM ET 2004-08-12T15:25:17

Enron Corp. founder Kenneth Lay won’t get the September trial he wanted on charges stemming from the scandal-choked company’s collapse.

But he could learn by early October whether he’ll get a separate trial or face a judge or jury next alongside his one-time protege, former Enron CEO Jeffrey Skilling, and the company’s former top accountant, Richard Causey.

Lay and Skilling appeared in court together Wednesday for the first time since Lay was added as a defendant last month to the case against Skilling and Causey. They smiled at one another, appeared to speak cordially out of earshot of observers, and then conferred with their lawyers. Neither was required to appear, and Causey didn’t attend the hearing.

Skilling, 50, and Causey, 44, each face more than 30 counts of conspiracy, fraud and insider trading for allegedly participating in schemes to fool investors into believing Enron was more financially healthy than it was in the nearly two years leading to the company’s December 2001 collapse.

Lay, 62, faces 11 counts of conspiracy, fraud and lying to banks. Prosecutors allege he commanded the conspiracy upon Skilling’s abrupt resignation in mid-August 2001.

All three have pleaded innocent.

Enron plummeted into bankruptcy on devastating revelations of cooked books, hidden debt and inflated profits. Its failure was the first in a string of corporate scandals that shook Wall Street.

In July, Lay became the 30th individual charged in the Justice Department’s probe. Eleven have pleaded guilty, including former finance chief Andrew Fastow, who admitted to engineering schemes to fool investors into believing Enron was more financially robust than it was while skimming millions of dollars for himself on the side.

Lay had asked for a separate Sept. 14 trial, and told U.S. District Judge Sim Lake he’d give up his right to face a jury and leave his fate in the judge’s hands if that would result in a speedy prosecution.

But Lake on Wednesday declined to set a trial date. The judge instead set deadlines for lawyers for Skilling and Causey to file their own requests for separate trials, and said he expected to rule on those issues in early October.

Prosecutors want March 2005 trial
Prosecutors want to try the trio together in March 2005. Skilling and Causey want another year and a half to prepare and asked for a March 2006 trial.

Lake said once he rules on all three requests for separate trials, he will rule on expected requests from Skilling and Causey to move their trials from Houston. After that, the judge said he would consider trial dates.

Lay’s main criminal lawyer, Michael Ramsey, argued that Lay is already prepared “because the indictment against him is thin.” Lake said Ramsey had noted such arguments in court filings, and advised the attorney, “Why don’t you save the press conference until after this hearing.”

Lay said after the hearing he was glad Lake would rule soon on his request for a separate trial.

“It’s time for them to be compelled to try me,” he said of prosecutors, who declined comment.

Daniel Petrocelli, Skilling’s lead trial lawyer, elaborated on his arguments in court that prosecutors had been lax in turning over documents that could be helpful to the defense as required.

Specifically, Petrocelli noted that prosecutors allege Skilling conspired with Fastow to allow shady partnerships to be created that manipulated Enron’s finances and enriched Fastow. The former finance chief pocketed more than $45 million from running the shady LJM partnerships.

Petrocelli said prosecutors had failed to turn over copies of a crucial e-mail written in January 2001 by former in-house Enron lawyer Jordan Mintz that said, “I spoke again with Andy about this earlier today and he believes, perhaps rightly so, that Skilling would shut down LJM if he knows how much Andy earned.”

Petrocelli said the document shows Skilling “had no knowledge of Fastow’s arrangements.”

© 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


Discussion comments


Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments

Data: Latest rates in the US

Home equity rates View rates in your area
Home equity type Today +/- Chart
$30K HELOC FICO 3.79%
$30K home equity loan FICO 4.99%
$75K home equity loan FICO 4.69%
Credit card rates View more rates
Card type Today +/- Last Week
Low Interest Cards 13.83%
Cash Back Cards 17.80%
Rewards Cards 17.18%
Source: Bankrate.com