Skilling struggled to stay calm

April 22, 2006|By THOMAS S. MULLIGAN | THOMAS S. MULLIGAN,LOS ANGELES TIMES

HOUSTON -- During his eight pivotal days on the witness stand, it became clear that nobody can control Jeffrey K. Skilling - sometimes not even Skilling himself.

Daniel M. Petrocelli, Skilling's urbane and witty lead defense lawyer, has joked several times that even if he'd written a script for Skilling's testimony, it wouldn't have worked because his headstrong client is "absolutely unrehearsable."

Under both friendly examination by Petrocelli and antagonistic grilling by prosecutor Sean M. Berkowitz, Skilling often had trouble reining himself in. He bristled at questions, offered humorous or sarcastic asides and occasionally asked questions of his own.

"Skilling wasn't able to take off his CEO hat," said Mark C. Zauderer, a New York litigator who has been following the case.

There were few clues as to how the testimony affected the jury of eight women and four men.

In Zauderer's estimation, though, Skilling's refusal to concede Berkowitz even the smallest point came across as evasiveness. But to Houston defense lawyer Dick DeGuerin, it came across as a principled refusal to be pushed around.

"I don't know that the jury had to like him, they just had to believe that he was right on the facts," DeGuerin said.

From the outset of his fraud and conspiracy trial in January, Skilling maintained that his testimony would be his best shot at persuading the jury that the government erred badly - perhaps maliciously - when it tried to pin him and co-defendant former Enron Chairman Kenneth L. Lay with Enron's 2001 collapse.

The Skilling who appeared on the stand matched closely the man that jurors may have heard described in media accounts as blunt, detail-oriented, impatient and bright.

He was also closely matched with his Berkowitz, the co-lead prosecutor and a fellow Chicagoan.

Skilling, 52, was a George F. Baker Scholar at Harvard Business School, a distinction awarded to the top 5 percent of a graduating class. Berkowitz, 48, finished first in his class at Tulane University and went on to Harvard Law School. Friends describe him as funny, resourceful and extremely competitive.

He was able to put some dents in Skilling's credibility. The prosecutor revealed how Skilling failed to tell regulators that he had tried to sell 200,000 Enron shares on Sept. 6, 2001, just weeks after leaving the company. The sale did not go through until after the 9/11 terrorist attacks, because Skilling's broker questioned his "insider" status. The defendant said that he did not remember the earlier attempt to sell the stock and only sold after the attacks because of concerns about the economy. And Skilling's repeated public statements - played for the jury on tapes or flashed on the courtroom screen - that Enron was not a major electricity speculator during the California energy crisis of 2000 and 2001 didn't square with the testimony of Timothy N. Belden, an Enron energy trader who told the jury that his Western power desk raked in more than $800 million in nine months on just such speculation.

Skilling, for his part, used Enron securities filings to cast doubt on allegations that Enron had failed to disclose transactions with off-the-books partnerships run by former Chief Financial Officer Andrew S. Fastow.

He effectively rebutted Berkowitz on whether a key meeting with Lay had been a week after Skilling's Aug. 14, 2001, resignation or nearly a month later. Skilling also showed an easy grasp of the details of some of Enron's complex hedging strategies, although much of his technical testimony may have gone over the heads of jurors - and everyone else in the courtroom.

Skilling "made the points he needed to make," such as denying that he lied or pushed subordinates to hide losses or fraudulently pump up profits, although even in these cases his persistent combativeness may have betrayed him, said Houston lawyer Michael J. Wynne.

"He couldn't answer some basic questions without a fight," said Wynne, a former federal prosecutor who has attended much of the trial.

Berkowitz, for example, tried several different ways to get Skilling to acknowledge that, as CEO, he was responsible for his company's public statements. Skilling kept referring to the lawyers, accountants and more junior executives on whom he relied.

Thomas Mulligan writes for the Los Angeles Times.

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