Wednesday, June 01, 2005
Court reverses conviction of Enron auditor
The Supreme Court threw out the government's high-profile conviction against Arthur Andersen yesterday, saying in a unanimous and swift decision that jurors relied on flawed instructions in 2002 when they found that the accounting giant had obstructed justice by destroying reams of Enron-related files.
The ruling comes too late for the former Big Five accounting firm. Its indictment during the heat of the Enron scandal and its subsequent conviction amounted to what lawyers called a "corporate death sentence." The Chicago-based firm that once employed 28,000 is nearly defunct, with a skeleton staff of about 200.
But the case - the first of the recent corporate scandal prosecutions to reach the Supreme Court - was closely watched by corporate executives, in-house lawyers and defense attorneys who feared that it would set a dangerous precedent on routine matters of dispensing legal advice and disposing of sensitive business documents.
"Arthur Andersen is never going to come back. They're never going to be resurrected. But the conviction, when it came down, sent tremors or ripples throughout the legal community and certainly the in-house community," said Frederick J. Krebs, president of the American Corporate Counsel Association. "This sort of, 'There but for the grace of God go I,' sentiment was quite pronounced."
posted by Brian Moran @ 8:49 AM