Posted 9:20 AM by Robert

The Amazing Shrinking Enron Scandal III

As noted here previously, the Enron scandal has been shrinking a lot. Today it shrank yet another big notch.

When Arthur Andersen was convicted at the height of the post-Enron hysteria, the Man Without Qualities noted that the jury instructions that allowed that conviction were - to put it charitably - a dog's breakfast.

Today the United States Supreme Court overturned the conviction of the Arthur Andersen in a unanimous opinion:

[T]he jury instructions at issue simply failed to convey the requisite consciousness of wrongdoing. Indeed, it is striking how little culpability the instructions required. For example, the jury was told that, "even if [petitioner] honestly and sincerely believed that its conduct was lawful, you may find [petitioner] guilty." The instructions also diluted the meaning of "corruptly" so that it covered innocent conduct. .... The instructions also were infirm for another reason. They led the jury to believe that it did not have to find any nexus between the "persua[sion]" to destroy documents and any particular proceeding.

So to obtain a conviction of Arthur Andersen, the prosecutors had to rely on a definition of "corrupt" that allowed the jury to convict even if Andersen was found to have honestly and sincerely believed that its conduct was lawful. And, to make matters worse, the trial court judge allowed Andersen's conviction under a statute that criminalizes only acts taken to corrupt a "proceeding" without any "proceeding" being specified.

It is the opinion of the Man Without Qualities that such a definition allowed by the Andersen trial court could not be assigned to the word "corrupt" by anyone not swept up in a hysteria comparable to a medieval dancing mania. I believe that a careful reading of the Supreme Court decision reveals that Court's sheer astonishment at the preposterous, hideous injustice that transpired in the courts below. It's a tribute to the Supreme Court that every single Justice understood. But it's frankly appalling that the trial judge and the normally sound Fifth Circuit Court of Appeals didn't understand.

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