Court Ruling Little Comfort for Ex-Andersen Employees

The U.S Supreme Court Tuesday overturned the conviction of accounting giant Arthur Andersen on an obstruction of justice charge. It's a victory for the company, which was destroyed by the scandal. But the decision comes too late for the thousands of employees who worked for the accounting firm.

Copyright © 2005 NPR. For personal, noncommercial use only. See Terms of Use. For other uses, prior permission required.

STEVE INSKEEP, host:

In this country the US Supreme Court has overturned Arthur Andersen's conviction related to the Enron scandal. Yesterday's ruling is a huge defeat for the government. It's a victory for a company that was destroyed by the scandal. But as NPR's David Schaper reports, it is too late for thousands of employees who worked for the accounting firm.

DAVID SCHAPER reporting:

Three years ago last month, a Houston jury agreed with federal prosecutors that Arthur Andersen conducted an unprecedented campaign to destroy documents and found the accounting firm guilty of obstruction of justice for corruptly persuading employees to shred a paper trail. The documents in question related to Andersen's client, Enron, the Houston-based energy company that famously went bust in December of 2001. But in a unanimous decision, the Supreme Court overturned Andersen's conviction, ruling that the trail judge's instructions to the jury were too broad and too vague for jurors to determine correctly whether Andersen broke the law. Chief Justice William Rehnquist wrote, `It's striking how little culpability the jury instructions required to convict Andersen.' The decision is a blow to the Justice Department's effort to crack down on white-collar crime, but reaction to Andersen's victory among the firm's former employees is somewhat muted.

Mr. RANDY PASCHKE (Former Arthur Andersen Employee): Well, it's--you know, it's a little hollow, I guess, only because it probably doesn't--it's not going to bring Arthur Andersen back.

SCHAPER: Randy Paschke worked for 32 years at Arthur Andersen's Detroit office and is now chairman of the accounting department at Wayne State University.

Mr. PASCHKE: We've been vindicated a little bit, I guess, by the ruling. The sad part is a lot of people's lives were obviously torn apart and shaken and careers changed and retirements changed for something that really probably should never have happened.

SCHAPER: Andersen had employed 28,000 people in the US and more than 80,000 worldwide, nearly all of whom were out of a job after the conviction. And maybe no one is more in touch with more of them that Jonathan Goldsmith, a former mergers and acquisitions consultant for Andersen who now runs a Web site called AndersenAlumni.net. It serves as an employment and support group network for Andersen outcasts. After being inundated with phone calls and e-mails from former colleagues much of the day Tuesday, he took a late lunch break at a Thai restaurant on Chicago's North Side reflecting on his mood.

Mr. JONATHAN GOLDSMITH (Former Arthur Andersen Employee): I think it's more bittersweet than celebratory.

SCHAPER: Goldsmith said the ruling is nice, but won't bring the jobs back and won't bring Andersen back. And for many former employees, he said, the Supreme Court action is reopening old wounds.

Mr. GOLDSMITH: I think people are more upset that this even resurfaced because people have tried to put this behind them, and it took years--it probably a year and a half, two years, and now all of a sudden it's in the--it's on the front page of the newspaper and everyone's talking about it.

SCHAPER: Goldsmith said the news is especially difficult for those still out of work and those who have felt stigmatized by the conviction. The Supreme Court ruling does not exonerate Arthur Andersen. The Justice Department could decide to retry the little that's left of the once mighty accounting firm. A spokesman said the department is disappointed in the ruling and is reviewing its options.

David Schaper, NPR News, Chicago.

INSKEEP: You're listening to MORNING EDITION from NPR News.

Copyright © 2005 NPR. All rights reserved. No quotes from the materials contained herein may be used in any media without attribution to NPR. This transcript is provided for personal, noncommercial use only, pursuant to our Terms of Use. Any other use requires NPR's prior permission. Visit our permissions page for further information.

NPR transcripts are created on a rush deadline by a contractor for NPR, and accuracy and availability may vary. This text may not be in its final form and may be updated or revised in the future. Please be aware that the authoritative record of NPR's programming is the audio.

Comments

 

Please keep your community civil. All comments must follow the NPR.org Community rules and terms of use, and will be moderated prior to posting. NPR reserves the right to use the comments we receive, in whole or in part, and to use the commenter's name and location, in any medium. See also the Terms of Use, Privacy Policy and Community FAQ.