His Personality Parade
Former Enron CEO Skilling's Character Is on the Stand, And He's Emotional, Assertive and Downright Wonky

By Carrie Johnson
Washington Post Staff Writer
Thursday, April 13, 2006

HOUSTON, April 12 -- In three days on the witness stand, former Enron Corp. chief executive Jeffrey K. Skilling has expressed many sides of his complex personality: his driving ambition, his emotional exhaustion, and on Wednesday -- his absentminded energy geek.

Skilling twice stepped down from the witness box Wednesday to give the jurors, who will decide whether he is guilty of fraud and other charges, a lesson in energy trading. He walked them through complicated charts designed to show that he did not break the law when he told analysts and investors that the company exuded health and had its risks under control.

Under the guidance of defense lawyer Daniel M. Petrocelli, who tried without success to urge Skilling to keep his explanations simple, Skilling appeared more confident than at any point during this 11-week-old trial.

On Monday, in his first day of testimony, Skilling appeared emotional and nervous, recounting the personal toll Enron's success -- and subsequent collapse -- had taken in his personal life, including his drinking and depression.

On Tuesday, he showed his in-charge, executive demeanor.

On Wednesday, he was in his element in a different manner: at the head of the class, instructing a group of listeners about why his ideas changed the industry.

"As soon as you balance your portfolio, you have eliminated price risk. . . . Does that make sense?" he asked the jury.

Petrocelli replied, "They can't answer your questions," as members of Skilling's family laughed from their seats in the front row.

Skilling, 52, repeatedly apologized for his extended rationales, but he couldn't resist elaboration. After his lawyer posed a hypothetical scenario, Skilling interjected, "Let's not do that; let's make it go from $4 to $3."

The response prompted a laugh from his fellow defendant and former Enron chairman Kenneth L. Lay, who is likely to testify later in the case.

What remains unclear is how jurors will square the image of Skilling comprehensively analyzing such issues as the impact of an August 2000 pipeline explosion on energy prices with his inability to remember other events -- including a key attempt to sell Enron stock a year later.

"I tried very hard to keep up to speed with what was happening" at Enron, Skilling testified Wednesday.

At first, jurors pivoted in their chairs to watch Skilling at the easel. U.S. District Judge Simeon T. Lake III stepped down from his perch to get a better view. And the prosecutor, who will cross-examine Skilling as early as next week, moved to look, as well.

But by the afternoon, as Skilling gave sweeping alternative explanations for many of the 28 criminal charges against him, several members of the jury exchanged smiles. They came back from an afternoon break bearing cups of coffee. And the judge, perhaps recognizing signs of fatigue, reminded panel members when they left for the day that there was only "one more day this week."

"Time's really flying," he said.

In addition to his lectures on the energy business, Skilling told jurors he did not manufacture earnings or engage in a criminal conspiracy with Lay and others to mislead investors about Enron's health -- attacking the prosecution case at its core. He called a decision that he, Lay and the board made to allow then-finance chief Andrew S. Fastow to run outside business partnerships that did deals with Enron "a horrible idea" in retrospect.

And he added that had he known Fastow was stealing from the company, he probably "would have called the FBI." Skilling said, "I might have a little hesitation now about doing that, but at the time, I would have done it." Skilling's relatives once again broke into laughter.

Skilling also revisited his final weeks at the company, reminding jurors of a July 13, 2001, conversation in which he told Lay he would resign. Earlier this week, in some of the most emotional testimony in the trial, Skilling said he was emotionally exhausted and that his life was "totally out of whack" at the time.

On Wednesday, Skilling testified that Lay had approached him a few days after that conversation, having discussed Skilling's departure with several board members.

"The first question they had was, 'Does he know something we don't know?' " Skilling recalled. He said he discussed the finances with then-accounting chief Richard A. Causey, who told him things were "fine." Skilling said he walked into Lay's office and delivered the same message.

Both Fastow and Causey have since pleaded guilty to criminal charges, as have more than a dozen other former Enron executives. Skilling and Lay argue that many of them caved to prosecutors' pressure rather than go to trial and face the prospect of long prison sentences.

Among the testimony Skilling worked to rebut Wednesday was the account of his former protege David W. Delainey, who said his boss had hugged him in delight when he disclosed that he had stockpiled millions of dollars in reserves to protect against volatility in the market. Prosecutors say the reserves were improper, but Skilling argued Wednesday that they made sound business sense.

"I may have kissed him; I certainly hugged him," Skilling said. "To me, this was very encouraging because I believed it was appropriate."