The call for the resentencing of former Enron CEO Jeff Skilling won’t be the first time the 5th Circuit Court of Appeals has made such a demand of U.S. District Judge Sim Lake in a high profile white collar crime case.
| Is Skilling’s likely resentencing related to ….
In 2004 Lake sentenced former Dynegy accountant Jamie Olis to 24 years in prison after a jury found him guilty on six counts of conspiracy and wire, securities and mail fraud. He was accused of helping the company boost its cash flow through a 2001 gas trading and finance scheme called Project Alpha.
Olis could have received as little as six months, but Lake called for a sentence of 24 years, saying what were then mandatory sentencing guidelines gave him no choice when applying a $100+ million shareholder loss figure used during the trial.
| …. that of former Dynegy accountant Jamie Olis?
At the time Olis’ sentence was believed to be one of the largest ever handed down for a white collar case. It surprised many in the business and legal communities given Olis’ relatively low rank at Dynegy and the short sentences his boss and a co-worker received after pleading guilty for their roles in the transaction.
Olis began serving his sentence in May 2004, but in January 2005, the U.S. Supreme Court ruled in another case that sentencing guidelines were not mandatory, setting the stage for Olis’ attorneys to successfully argue before the 5th Circuit for a new sentence.
His new sentence was reduced to six years, which he is continuing to serve at FCI Three Rivers about 80 miles south of San Antonio. He has an expected release date of August 2009.
Legal experts don’t believe the dual decisions are necessarily a reflection on Lake, however.
In the case of Skilling, the 5th Circuit called for the resentencing because it said Lake wrongly added time to the sentence based on a government contention that Skilling jeopardized a financial institution with conduct that threatened Enron’s retirement and stock ownership plans. The panel said those plans don’t qualify as financial institutions.
Kirby Behre, a sentencing expert who literally wrote the book on the topic, said resentencing Skilling was done “… on a technical, unsettled question of law. The court of appeals upheld the trial court’s decisions on all other issues, so I don’t view the opinion as any sort of rebuke of Judge Lake.”
Ellen Podgor, a professor at Stetson University’s School of Law, said “I don’t think it is significant that a judge is being reversed on a sentencing issue. The guidelines are relatively new, constantly changing, very much needing interpretation, not to mention that the Supreme Court’s recent decisions provide a greater ability for judges to go outside the guidelines, often a cause of a sentencing remand – although not the cause here.”
Podgor has more to say on a blog she contributes to here.
Peter Henning, a law professor at Wayne State University Law School, said the Skilling resentencing decision “does show that Judge Lake takes a fairly aggressive approach to the application of the Guidelines.”
“The difference with Skilling is that the effect will likely be about 8 years based on a lower Offense Level, while with Olis it was much more significant, from 24 years to about 6 years,” Henning said.
There certainly are similarities, though, Henning said. The Fifth Circuit was complimentary toward Judge Lake, “especially on the jury selection issue, so I think the sentencing issue in Skilling was not a slap at him, but more a technical analysis in an area of the law that has not often been discussed in the cases.”
Tom Kirkendall, a Houston attorney who has represented some Enron executives in civil suits and is a prolific blogger of many topics, expounds on the decision at length here (including a few customary jabs at the Chronicle). His summary of the resentencing issue:
“That’s certainly better than nothing.”