The judge in the trial of ex-WorldCom Inc. chief Bernard Ebbers ruled Tuesday that the defense could quiz the star witness about marital infidelity and blocked testimony about Ebbers' knowledge of hearings into the Enron scandal.
The government had sought to produce evidence that Ebbers watched the hearings on the collapse of Enron Corp. and discussed them with Scott Sullivan, his chief financial officer.
Federal prosecutors had hoped to use the episode to show that Ebbers knew WorldCom's own accounting procedures amounted to criminal conduct. Ruling on the eve of Ebbers' trial, U.S. District Judge Barbara Jones said she did not see the relevance.
Sullivan had faced his own trial until pleading guilty last year and agreeing to testify against his former boss.
The judge also said she would allow Ebbers' defense lawyers to question Sullivan about marital infidelity because it addresses "Mr. Sullivan's character for truthfulness."
But in a victory for the government, the judge refused to grant immunity to two former WorldCom executives who the defense says could provide testimony favorable to Ebbers.
The defense wants to use the two executives to show that Sullivan, not Ebbers, was behind WorldCom's accounting tricks — but contends the government is keeping them "in limbo" and reserving the right to prosecute them.
"We don't have a fair trial if this evidence is not before the jury," Ebbers lawyer Reid Weingarten said, unsuccessfully trying to sway the judge.
The rulings came the day before potential jurors are to fill out questionnaires in the trial of Ebbers, who is charged with orchestrating WorldCom's accounting fraud.
Opening statements could begin some time next week.
Ebbers, 63, has pleaded not guilty. The charges against him carry up to 85 years in prison.
In 2002, WorldCom collapsed under the weight of an $11 billion accounting fraud and filed for the largest bankruptcy in the history of American business. The collapse of Enron had come in late 2001.
Federal prosecutors say Ebbers lied about his company's finances before the collapse, orchestrating a shell game to cover up its problems and stay in Wall Street's good graces.
While Ebbers has kept a low profile since he was indicted in March 2004, he has always maintained his innocence.
"Bernie Ebbers never sought to mislead investors, never sought to improperly manipulate WorldCom's numbers, never improperly took any money and never sought to hurt the company he built," his lawyer Reid Weingarten said at the time.
The trial was expected to last four to eight weeks. It will be followed closely by some of the tens of thousands of people who lost their jobs or their investment money when WorldCom folded.
One of them is Danny Thompson of Plano, Texas, a former Tyco engineer.
"Bottom line, one minute you have a retirement plan and a future, you're making a living wage at a great job, and the next you're working for less than half of what you used to make and have zero retirement," he said.
The company has emerged from bankruptcy and now operates under the name MCI Inc., with headquarters in Ashburn, Va.