Prosecutors Grill Skilling on Enron Debacle

Federal prosecutors begin their cross-examination of former Enron CEO Jeffrey Skilling over his role in the collapse of the company. The government accuses Skilling of orchestrating fraud and conspiracy that led to one of the largest bankruptcies in U.S. history.

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MELISSA BLOCK, host:

In Houston today, the government began its cross-examination of former Enron CEO Jeffrey Skilling. He faces 28 counts of fraud and conspiracy relating to the collapse of the former energy trading giant. Skilling's defense largely has been based on his testimony surrounding the events leading up to Enron's bankruptcy filing. How Skilling's story holds up under cross-examination is critical to the outcome of the government's case against him. Joining me now from the federal courthouse in Houston is NPR's Wade Goodwyn, and, Wade, tell us about the cross-examination and how it went today.

WADE GOODWYN reporting:

Well, it's been going, I would say, slowly and quietly thus far. But under the surface, there is a real power struggle going on between Jeff Skilling and Sean Berkowitz, who's the prosecutor cross-examining him. Toward the end of his direct testimony last week, Skilling summed up by kind of wrapping himself in Enron's flag. He said he was testifying to set the record straight once and for all. He told the jury that he bled Enron blue, and he said he would fight to clear his name until the day he died.

Well, you could tell this morning that that did not go over big with prosecutors, because it was the first thing that Berkowitz went after Skilling with. He said, you say you bled Enron blue, but you're not Enron, are you? Enron's a corporation made up of shareholders, and these shareholders are now suing you in civil court, and these are the lawsuits you're going to be fighting until you die, aren't they? Jeff Skilling mostly gave one-word answers, that answer being yes. And through the line of questioning, right out of the box, Berkowitz recaptured some of that moral high ground that Skilling tried to claim for himself last week.

BLOCK: How would you describe the dynamic throughout the day between the prosecutor, Sean Berkowitz, and Jeffrey Skilling?

GOODWYN: Sean Berkowitz is not particularly dramatic in his style of cross-examination. I'd say Sam Waterston's job on Law and Order is safe. But very quietly he's demonstrated to Skilling and the jury that he knows more about every aspect of this case than Skilling does. And whenever Skilling tries to take issue with a point that Berkowitz is making, Berkowitz then produces some document or an email that supports his contention, and then he rubs Skilling's nose in that document.

Let me tell you a quick story. Berkowitz was in the middle of this fairly dry line of questioning about the value of Enron's international assets. During one of his answers, Skilling happened to mention that he discussed this with one of his lawyers during the morning break, and Berkowitz immediately broke stride and said, you talk things over with your lawyers a lot during the break, don't you? And Skilling looked a little puzzled and weary and said, yeah, he did. And then Berkowitz said, in fact, you talk with your lawyers during the breaks about how your testimony's playing with the jury, don't you? And you want a lawyer whose specialty's influencing juries, isn't that correct, Mr. Skilling?

And here Skilling tried to take issue with Berkowitz's characterizations that his lawyer was there to help him unduly spin the jury, and Berkowitz said, well, let's just take a look at her website, shall we? Can we put that up on the screen? And whoosh, you know, just like that, the jury is leaning forward, looking at Skilling's jury expert's website on this big white screen. And, as you can imagine, it's all about her expertise in jury persuasion. So in the midst of this rather dull discussion about international assets, Berkowitz pounces and makes it seem like Skilling's characterization of his own lawyer's work isn't forthright. And Skilling's got to be thinking, sheesh, you know, where did this come from? And it sent a message to the jury, but also to Skilling, and that is, I'll punish you if you argue with me about the facts. And by the end of morning, Skilling was trying to argue with Berkowitz less.

BLOCK: And Jeffrey Skilling is supposed to be cross-examined for about three days this week. What about the former Chairman of Enron, Kenneth Lay? When is he expected to take the stand?

GOODWYN: Well we're not quite sure, but it could happen as soon as the end of next week. And, you know, it will be the same situation like this. Another very big witness followed by another very important cross-examination.

BLOCK: Wade thanks very much.

GOODWYN: Oh you're quite welcome.

BLOCK: NPR's Wade Goodwyn in Houston.

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