Jurors deliberating in the fraud trial of former HealthSouth Corp. leader Richard M. Scrushy told a judge Friday they were "unable to reach a verdict of guilty or not guilty of any/all counts."
U.S. District Judge Karon O. Bowdre called in the jury's 12 members and gave them instructions designed to help break the deadlock. The judge said that the trial, which began Jan. 25, has involved "great time and exceptional effort." She added that there is "no reason to believe this case could be heard by 12 people who are more conscientious."
Outside of the jury's presence, defense lawyers for Scrushy objected to the judge's instructions, which are known as an Allen charge, on the grounds that jurors might feel compelled to convict Scrushy. Justice Department official Richard Smith told reporters gathered outside the courthouse that he was confident the jury would reach a unanimous decision.
"If they truly weigh the evidence . . . we will be able to get a verdict in this case," Smith said.
Scrushy is charged with more than three dozen offenses, including fraud and conspiracy in a $2.7 billion accounting fraud that damaged the rehabilitation hospital company he founded. He is the first chief executive to be accused of violating the 2002 Sarbanes-Oxley Act, which requires corporate leaders to vouch for the accuracy of their financial statements.
Jurors sent the note -- the fourth signal that they could not reach a unanimous decision -- at 10:27 a.m. Central time. An hour later, the judge read them brief instructions for resuming their deliberations, and they filed back into the room where they had been meeting.
The jury sent no further public messages and went home for the day shortly before 3 p.m. They will return to the courthouse on Monday.
Allen charges are not uncommon in complex white-collar fraud cases. Judges in obstruction of justice trials involving the accounting firm Arthur Andersen LLP and investment banker Frank P. Quattrone have employed the instruction when jurors reported themselves deadlocked. Sometimes the charge works and jurors ultimately render a verdict as they did in the Andersen trial.
The charge asks jurors to reconsider their positions without surrendering deeply held convictions. "Your goal should never be to just return a verdict but to return a just verdict," the judge said yesterday.
Jurors have struggled through a 37-page verdict form that includes four pages of questions about the conspiracy charge alone. They have asked for explanations "in layman's terms," and one of them requested that the judge simply "circle one -- yes or no" -- in response to a question about whether they had to unanimously agree.
The trial included nearly three dozen government witnesses, including two forensic accountants and five of the company's former chief financial officers, who implicated Scrushy in the accounting fraud. Along the way, jurors heard testimony about such complex matters as accounting for acquisitions, property and equipment, and government payments for Medicare claims.
Scrushy has denied the charges and says he was duped by subordinates who sought to enrich themselves.
"I'm innocent of these charges," Scrushy said outside the courthouse. "I will say that till the day I die."
The jury resumed deliberations Friday afternoon. Prosecutors and defense lawyers rejected the possibility that they would reach a plea deal.