washingtonpost.com  > Technology > Special Reports > MCI

Page 2 of 2  < Back  

Verdict Weakens Ignorance Defense

Once on the stand, Ebbers was put into the position of repeatedly having to explain how he could have missed $800 million swings in a key expense area at a time he was canceling the company coffee service to save $4 million.

In the end, according to one of the jurors, some panel members decided not to believe either Ebbers or Sullivan, preferring instead to seek corroborating evidence from documents and witnesses they perceived to be honest.

Bernard J. Ebbers climbs into a taxi after the guilty verdict was delivered. He testified during his trial that he missed $800 million swings in key expenses. (Adam Rountree -- Bloomberg)

_____Live Discussion_____
Transcript: The Washington Post's Brooke A. Masters was online to discuss the Ebbers case.
Transcript: Roma Theus, vice chairman of the Corporate Integrity and White Collar Crime Committee at the Defense Research Institute
Graphic: A Titan's Rise and Fall
Photo Gallery: Ebbers Through the Years
Video: The Washington Post's Brooke Masters discusses the scene inside the courtroom.
_____In Today's Post_____
WorldCom's Ebbers Convicted (The Washington Post, Mar 16, 2005)
Verdict Stirs Up Mix of Emotion For Employees (The Washington Post, Mar 16, 2005)
Ebbers, One in a Long Line of Egos (The Washington Post, Mar 16, 2005)
_____Recent Coverage_____
Jury Seeks Guidance In Ebbers's Trial (The Washington Post, Mar 10, 2005)
Jury Begins Deliberations in Trial of WorldCom's Ebbers (The Washington Post, Mar 5, 2005)
Ebbers's Attorney Blames Underlings (The Washington Post, Mar 4, 2005)
Prosecution Says Ebbers Had Motive, Led Fraud (The Washington Post, Mar 3, 2005)
Conflicting Portraits Of Ebbers Drawn at Trial (The Washington Post, Mar 2, 2005)
_____From FindLaw_____
Indictment (U.S. v. Ebbers)
_____Message Boards_____
Post Your Comments

After the verdict, Weingarten defended his decision to put Ebbers on the stand. "I thought it was an easy decision, and I thought he did fine. . . . I would do it again today," Weingarten said.

Outside lawyers agreed the decision made sense, but they noted that the defense team was fighting a difficult battle. "It wasn't as if Ebbers was testifying against a very appealing witness" in Sullivan, said Angela C. Agrusa, a litigator who specializes in complex financial fraud cases. "What you can't overcome is that the company lost a lot of money, and he is the boss."

Still, the analysts cautioned, every jury is independent, and there are enough differences between Ebbers's case and those of the Enron and HealthSouth bigwigs that Tuesday's win for the government does not automatically translate into a defeat for the other defendants.

Lay, like Ebbers, claims to have been kept in the dark by subordinates, but he may do better because of the role he played at Enron and the complexity of the fraudulent partnerships that ultimately brought it down, they said.

Lay served as the outside face of the company for years, dealing with investors and hobnobbing with politicians and international leaders, rather than running day-to-day operations. Unlike Ebbers, who was convicted of participating in WorldCom's fraud from its beginning, Lay is charged mainly for optimistic statements he made to investors and employees in the weeks before Enron filed for bankruptcy protection.

"Lay will have to consider that the Ebbers jury didn't buy the out-of-the-loop defense, but what else can he do? He can't argue there wasn't a fraud," said former federal prosecutor David M. Rosenfield. A spokeswoman for Lay declined to comment.

For his part, Scrushy's attorney Donald V. Watkins took pains to distinguish his client's case from that of Ebbers. For one thing, Watkins said, Scrushy, 52, is on trial in Birmingham, a city he has lavished with charitable contributions. For another, HealthSouth never filed for bankruptcy protection, unlike Enron and WorldCom.

"As we have consistently stated throughout the course of the trial . . . unlike Enron and WorldCom, HealthSouth was, and continues to be, a solid and real company," Watkins said. "This fine company was inspired and developed by Richard Scrushy, and we expect full vindication at the conclusion of the trial."

Lay, 62, may also think pleading guilty is not an option, the outside lawyers said.

"I don't know that a conviction is going to put pressure on people to plead guilty, particularly if you're 60 years old and looking at a guideline sentence of 15 or 20 years," said Lawrence Byrne, a partner at White & Case LLP. "That's effectively a life sentence, so what choice do you have but to go to trial?"

Still, Ebbers's conviction sends a strong warning that jurors will be skeptical of business executives who pocketed hundreds of millions of dollars yet claim they were simply functioning as a "coach" rather than running the show.

"The message to others awaiting like trials as well as those running other corporate giants is clear: If you play in big leagues, but only intend to coach, expect to get benched to the nearest federal prison," said Charna E. Sherman, a defense attorney.

Masters reported from New York. Johnson reported from Washington. Staff writer Ben White also contributed to this report.

< Back  1 2

© 2005 The Washington Post Company