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Numerous outcomes possible for ruling on Nacchio
Even if the conviction of the former Qwest CEO is upheld, a three-judge panel may still get the case back.
By Andy Vuong

Denver Post
Thursday, December 11, 2008

When the full 10th Circuit Court of Appeals rules on former Qwest chief executive Joe Nacchio's appeal of his insider-trading conviction, some issues may remain unresolved.

If the court, which could render its decision any day, affirms the conviction, the case may still be sent back to the three-judge panel that initially heard the appeal to review Nacchio's challenge of his prison sentence.

Nacchio contends that the 72-month prison term should be shortened to 41 to 51 months.  He also is seeking to reduce the $71 million in forfeitures and fines he was ordered to pay, calling the amount excessive.

It's possible, but unlikely, that the full court would rule on those challenges as part of its review of the case, according to legal experts.

"If the panel didn't address them, it's unlikely the en banc (full) court would address them," said Blain Myhre, an appellate lawyer with Isaacson Rosenbaum in Denver.

In ruling 2-1 to toss out the conviction in March, the initial panel said it was unnecessary to review the sentencing matter because Nacchio would "have to be sentenced anew if he is convicted again."

Nacchio was convicted last year on 19 counts of illegal insider trading connected to his sale of $52 million in Qwest stock in early 2001.  He was acquitted on 23 related charges.

After the initial panel overturned the conviction and ordered a new trial, the full appeals court granted the government's request last summer to rehear the case.

At issue is whether the trial judge hindered Nacchio's right to a fair trial by wrongfully excluding expert testimony from a defense witness.  The panel ruled that he did, and the full court could agree and toss out the conviction, granting Nacchio a new trial.  The court could also return the case to the district court to hold a hearing to determine whether the testimony should have been allowed during trial, an unlikely scenario.

Both sides would have 90 days after the ruling to petition to have the case heard by the Supreme Court, a rare occurrence.  The parties could seek a 60-day extension to make such a request.

Appeals can last from months to years.  The initial panel ordered an expedited appeal after granting Nacchio's request to remain free on bail, an indication that the full court would consider the case at a similar pace.

The panel rendered its decision three months after hearing oral arguments.  The full court held oral arguments nearly three months ago, in late September.

"I think most people probably assume that they're also going to expedite the release of their decision," said Marcy Glenn, head of appellate practice at Holland & Hart.

Glenn stressed that there is no timetable for a decision.

The full review could take longer because there are nine judges instead of three.

If the conviction is affirmed, the government could request that the court revoke Nacchio's bond and order him to report to prison immediately.

U.S. District Judge Edward Nottingham sentenced Nacchio to 72 months in prison based on the gain from his illegal insider trades, pinned at $28 million after fees.  Nacchio argues that he gained $1.8 million.  A resentencing would have to be assigned to another district judge because Nottingham has since resigned.