March 1 (Bloomberg) -- U.S. Supreme Court justices signaled they are divided on Jeffrey Skilling’s appeal of his conviction for leading the accounting fraud that drove Enron Corp. into bankruptcy. Hearing arguments today in Washington, the justices spent most of the one-hour session debating whether the trial should have been moved from Houston, where thousands of Enron employees lost their jobs. A favorable ruling on that issue would mean a new trial for Skilling, Enron’s former chief executive officer.
Justice Sonia Sotomayor suggested she will vote for Skilling on that issue, faulting the trial judge for conducting a “truncated” session in questioning prospective jurors.
Chief Justice John Roberts countered that the trial judge had more than 15 years of experience and made the “reasonable” decision to question the jurors himself rather than turn the task over to the lawyers.
Skilling’s appeal says the atmosphere in Houston when the trial began in January 2006 was one of hostility toward him, fed by unrelenting, negative media coverage. The federal government contends that the trial judge, after questioning the jurors, was satisfied that each could assess the evidence impartially.
Skilling’s appeal also contends that a federal law banning so-called honest services fraud is unconstitutionally vague. A victory on that issue would overturn at least one count of his 19-count conviction.
Convicted With Lay
Skilling was convicted in May 2006 alongside Kenneth Lay, the former Enron chairman who died less than two months later. Skilling, 56, was sentenced to more than 24 years in prison, a term he is serving in a federal prison in Colorado. A federal appeals court upheld the conviction.
Enron was the world’s biggest energy-trading company, with a market value of as much as $68 billion, before it collapsed, wiping out more than 5,000 jobs and $1 billion in employee retirement funds.
The bankruptcy spawned criminal charges against 34defendants, including Arthur Andersen LLP, the now-defunct accounting firm whose conviction the Supreme Court overturned in 2005.
The case is Skilling v. United States, 08-1394. Skilling’s appeal says the atmosphere in Houston when the
