HOUSTON – A jury of nine women and seven men was picked Tuesday to decide the outcome of the first criminal trial involving former Enron Corp. (search) executives and a handful of their Wall Street bankers, nearly three years after the company crashed in scandal.
Two former midlevel Enron officials and four former Merrill Lynch & Co. (MER) executives are facing charges related to an alleged sham sale of electricity-producing barges off the coast of Nigeria to the brokerage in late December 1999 to help the energy company appear to have met earnings targets.
Jurors, four of whom are alternates, were to hear opening statements from attorneys later Tuesday. They were selected from an initial pool of 150 people.
U.S. District Judge Ewing Werlein told the prospective jurors Monday he expected they wouldn't have "come out of some hole somewhere" and at least would have heard of Enron, which collapsed in December 2001 and touched off a string of corporate scandals that sent investors fleeing and rocked Wall Street.
The key was whether they had heard of the defendants or the specific case.
Ten potential jurors indicated they had heard of the barge case. Six raised their hands when asked if they had an opinion based on their knowledge of the Enron scandal that could be transferred to the defendants.
Nearly 30 were eliminated early in the day based on answers on questionnaires about whether they had any ties to Enron or Merrill Lynch, if they or someone close to them had a financial interest in the firms and if they were affected negatively by Enron's crash.
Skilling was mentioned Monday by Werlein as among names jurors would hear during the trial. He also cited former Enron finance chief Andrew Fastow (search) and Richard Causey, Enron's former chief accounting officer, although none of the three men is on the prosecution witness list.
Daniel Petrocelli, Skilling's lead trial attorney, attended Monday's jury selection. He declined comment on the proceedings, but said it was "absolutely critical to probe intensively every prospective juror's exposure" to Enron's demise and its effect on the Houston community.
Petrocelli plans to ask the judge in Skilling's case to move his trial, which hasn't been scheduled, out of Houston. The barge defendants didn't ask for a change of venue.
In the barge case, prosecutors contend Merrill Lynch wanted more lucrative banking business from Enron, and participation in the barge deal was seen as a way to gain favor.
The six defendants are charged with conspiracy and fraud, and three face additional charges of lying to investigators or a grand jury. Prosecutors say they knew Enron had secretly promised to buy back the barges.
The defendants, who have pleaded innocent, are: Daniel Bayly, former chairman of investment banking for Merrill Lynch; Robert S. Furst, the former Enron relationship manager for Merrill Lynch; James A. Brown, former head of Merrill Lynch's asset lease and finance group; William Fuhs, former Merrill Lynch vice president who answered to Brown; Dan Boyle, a former finance executive on Fastow's staff; and Sheila Kahanek, a former in-house Enron accountant.