Risk Management

Ebbers Has Reason for Hope

Judges comment on "excessive" sentence and "unavailability" of witnesses.
Stephen TaubJanuary 31, 2006

Bernard J. Ebbers, the convicted former WorldCom Inc. chief executive, has good reason to believe his 25-year sentence for committing fraud may be reduced.

The three judges hearing his appeal on Monday questioned some of the prosecution’s tactics and clearly indicated that they thought the sentence was excessive. “There are many violent criminals who don’t get 25 years in prison,” noted Judge Jose Cabranes of the Second Circuit Court of Appeals, according to the New York Post. “Twenty-five years does seem like an awfully long time.”

Lawyers for Ebbers are heavily basing their appeal on the government’s decision not to grant three former top WorldCom executives immunity from prosecution, said The Washington Post. Defense attorney Reid H. Weingarten asserted that the government deliberately “put very important evidence beyond our reach” by refusing to rule out bringing cases against the three executives, including former chief operating officer Ronald R. Beaumont, said the paper.

The three executives refused to testify in Ebbers’s defense, even though they had already made statements to the FBI that seemed to support Ebbers’ assertions that former chief finance officer Scott Sullivan duped Ebbers and others. However, Assistant U.S. Attorney William F. Johnson maintained that the three former executives “still remain potential defendants” and that their testimony would not have cleared Ebbers, reported The Washington Post.

Johnson “squirmed,” said the paper, when Judge Cabranes asked whether the government had proceeded with its investigation into the three individuals since the Ebbers trial got underway in early 2005. After a long pause—which the judge commented on—Johnson replied no, adding, “We’re not actively investigating. There was certainly no manipulation effort here to keep the witnesses from testifying.”

Barrington D. Parker Jr., one of the other judges on the panel, noted that it was “curious” that the investigation of Beaumont and the others “fell into some black hole. That approach could really eviscerate the case law on unavailability [of witnesses], and the ability to manipulate could become problematic,” he told the Washington paper.

The court did not indicate when it would issue its ruling.

And while federal prosecutors declined to comment after the hearing, a seemingly upbeat Weingarten noted that, “Somewhere along the line, justice is going to be done in this case, and I hope it’s here. We’re optimistic and we have great issues.”