NEW YORK, March 11 -- Jurors considering the criminal securities fraud case against former WorldCom Inc. chief executive Bernard J. Ebbers deliberated for a sixth day Friday and again went home without reaching a verdict.
The seven women and five men on the panel have considered the nine charges against Ebbers for more than 33 hours, not counting lunch breaks, and have sent 25 notes to the judge requesting dozens of documents and transcripts of much of the key testimony. They have said nothing to the judge indicating that they are having any trouble reaching agreement.
Former WorldCom chief executive Bernard J. Ebbers, rear, faces nine counts, including securities fraud and conspiracy.
(David Karp -- Bloombery News)
But lawyers not involved in the case said the length of deliberations highlights the key challenge faced by both sides -- that the multibillion-dollar fraud case against Ebbers comes down to the conflicting testimony of two men with relatively little corroboration on either side.
"This case is a horse race. Although there's clearly evidence against Bernie Ebbers, it's not overwhelming," said Seth C. Farber, a former prosecutor. "When you've got a case that depends so much on witness testimony rather than documents, individual jurors may have different reactions . . . that take time to sort through."
Ebbers is charged with securities fraud, seven counts of making false filings to the Securities and Exchange Commission and conspiring to boost WorldCom's earnings -- and its stock price -- with billions of dollars in false accounting entries from 2000 to 2002. The company sought protection in bankruptcy court in July 2002 and now does business as MCI Inc. of Ashburn.
Former WorldCom chief financial officer Scott D. Sullivan was the prosecution's main witness, and he told the jury that he repeatedly advised Ebbers in private, one-on-one meetings that he was making "adjustments that weren't right" to the books to inflate revenue and hide expenses. Though Sullivan said he gave copies of key documents to Ebbers, prosecutors did not introduce any e-mail, voicemail or document that directly linked Ebbers to the central fraud in the case -- the decision to falsely reclassify operating expenses known as "line costs" as capital expenses.
Only one other witness, former controller David F. Myers, testified that Ebbers ever spoke about the fraud, and he, like Sullivan, has pleaded guilty and is working with prosecutors in hopes of reducing his prison time. Though Sullivan asserted that several other high-level WorldCom officials were in on the fraud and were present for meetings with Ebbers when the line-cost issue was discussed, they were not called to testify.
On the defense side, lead attorney Reid H. Weingarten attacked both Sullivan and Myers, saying they acted without Ebbers's knowledge and are now lying because they "want Bernie Ebbers to do their jail time."
But Ebbers's own testimony also was problematic. He denied ever meeting alone with Sullivan, even though the finance chief was his right-hand man and had an office practically next door. Ebbers, who had a reputation as an expense hawk who noticed cost overruns as small as $18,000, also insisted he had not noticed items in his monthly budget reports that showed line costs were swinging up and down by up to $900 million in a single month.
"There are big factual differences between [Ebbers and Sullivan], and jurors may wonder if the prosecutors have really proved" their case, said Yale University law professor Jonathan R. Macey.
Ebbers's personal financial choices also provided ammunition for both sides. Prosecutors noted that the fraud began in fall 2000, about the time banks began calling the $400 million in personal loans that Ebbers had taken out using his company stock as collateral. The defense noted that, with the exception of a sale forced by his bank, Ebbers -- unlike Sullivan -- hung on to every WorldCom share he could and even bought more company stock after he was forced out in April 2002.
The jury's last requests before going home on Friday were for a flip chart and markers, copies of all the WorldCom press releases that are in evidence, and the testimony of former WorldCom internal auditor Cynthia Cooper, the whistleblower who uncovered the fraud. Cooper testified for the defense that Ebbers -- again unlike Sullivan -- had never tried to hinder her work.
Deliberations are to resume Monday morning.