Jurors to Resume Deliberations In Nacchio Trial on Monday
The Wall Street Journal
Saturday, April 14, 2007
DENVER -- Jurors deliberated a second day in the $101 million
insider-trading trial of former Qwest Communications
International Inc. chief executive Joe Nacchio before being
dismissed for the weekend.
The eight men and four women deliberated Friday while attorneys
for both sides remained close by in case questions arose. U.S.
District Judge Edward Nottingham then released the jurors until
Monday, saying, "Let the case go for the weekend. You've worked
In a related development, prosecutors told Mr. Nottingham in a
brief filed Friday that Mr. Nacchio should be required to
forfeit the $101 million in gross proceeds from the sales if
convicted on all 42 counts.
Prosecutor Kevin Traskos, who drafted the brief, said the judge,
not the jury, should determine the amount of money to be
forfeited in the event of a guilty verdict.
The $101 million cited in the indictment was the gross amount
that Mr. Nacchio received from the sales, excluding any taxes or
the strike price of the options he exercised.
Prosecutors pointed to a document that committed Mr. Nacchio to
selling shares in early 2001 that they say was backdated from
December 2000, when Mr. Nacchio received the financial warnings,
to November 2000.
Defense attorneys say Mr. Nacchio believed Qwest would succeed
in the wake of its 2000 acquisition of U S West Inc. and have
noted Mr. Nacchio wanted to resign in January 2001 to stay in
New Jersey with his family during a difficult time.
The jurors are a diverse group, including several with education
or experience in the financial or insurance industries, an
airline pilot, a school district maintenance supervisor, a
chemist and a business owner. Most live in metropolitan Denver,
although some live north of the city as far as Fort Collins,
which is 60 miles away.
The jurors started deliberations Thursday and made several
requests, including writing materials, more copies of the
indictment and a master list of evidence. The requests were
signed by the airline pilot who identified himself as the
The case against Mr. Nacchio was filed after the government
investigated an accounting scandal at Denver-based Qwest shortly
after it acquired US West, a primary telephone service provider
in 14 mostly Western and midwestern states.
The Securities and Exchange Commission has said Qwest falsely
reported fiber-optic capacity sales as recurring instead of
one-time revenue between April 1999 and March 2002, which forced
the company to restate $2.2 billion in revenue.
The SEC has a pending civil fraud lawsuit against Mr. Nacchio
and other former executives at Qwest.