Risk Management

Skilling’s Lawyer: He Had Only the Company in Mind

Enron's ex-CEO "urged risky transactions that were unwise but violated no rules."
Stephen TaubApril 3, 2008

Lawyers for, Jeffrey Skilling, the former chief executive of Enron now serving a more than 24-year prison sentence are reportedly arguing in their appeal of his conviction that although he took risks when he ran the company, they were always with the intention to benefit the company.

Skilling’s convictions on charges of securities fraud, insider trading, and making false statements to auditors, were based on the legal theory that he deprived Enron of his “honest services” and put his own interests above those of the company, the Associated Press explained.

His lawyers, who on Wednesday made their appeal before the 5th Circuit Appeals Court, took their approach because the appeals court earlier overturned several Enron-related convictions based on the honest services theory, the AP noted, adding that those people argued that they did only what Enron wanted them to do and did not profit at its expense.

“In this case, we have an employee, Mr. Skilling, acting in pursuit of Enron’s interests at all times,” his lawyer, Daniel M. Petrocelli, reportedly told a three-judge panel. “Skilling urged risky transactions that were unwise but violated no rules.”

For his part, prosecutor J. Douglas Wilson asserted that Skilling’s actions were inconsistent with the goals of the company’s shareholders, according to AP. “At Skilling’s level, the corporation is the shareholders,” Wilson said, “and if his actions are contrary to [the shareholders’] long-term or short-term goals, then that is a violation of honest services.”