Nacchio's number not up yet
By Scott Robinson
Rocky Mountain News
Thursday, February 26, 2009
have not been kind to Joe Nacchio lately.
Having been convicted on 19 counts of insider trading, with a
loss calculated at $28 million, which resulted in a six-year
prison sentence, a $19 million fine, and $52 million in
forfeiture, Joe Nacchio has now lost his 10th Circuit appeal by
the narrowest of margins.
Wednesday's 5-4 decision reinstating the ex-Qwest CEO's insider
trading conviction leaves Nacchio with only one more last-gasp
chance to escape incarceration.
Joe Nacchio's case is Supreme Court-bound.
Just not quite yet.
Although whisker-close by legal standards, with four of the nice
participating 10th Circuit judges siding with Nacchio on his
claim that he was denied a fair trial by former District Judge
Edward Nottingham's ruling excluding most of a defense expert
witness' testimony, the outcome remains the same. The
conviction on 19 separate counts is resurrected, and the stay of
execution if lifted.
Meaning that Nacchio goes directly to prison, unless yet another
stay is granted. But from whom, and where does the case go
Initially, back to the original three-judge panel which reversed
his conviction in the first plane, to determine two as-yet
unresolved points raised by Nacchio's attorneys on appeal,
relating to the length of incarceration and the amount of
Nacchio's lawyers had argued that instead of a sentencing
guideline range of 70-87 months used by
Nottingham, the proper range should be 41-51 months,
based on the "gain" obtained by Nacchio.
Nacchio also urged that he should only have to disgorge about
$45 million, representing the gross proceeds of his stock sales
less out-of-pocket costs.
Those "leftover" issues will now have to be decided by the three
judges who first heard the appeal, a panel that includes two of
the judges who have consistently ruled in Nacchio's favor.
Even so, since resolution of the remaining issues would not free
Nacchio but would merely reduce his prison term and economic
losses, a stay is unlikely from the panel, leaving open only the
possibility of a stay from a justice of the United States
Supreme Court, in advance of a Nacchio obtaining a writ of
certiorari, or discretionary review, of the entire 10th Circuit
As the result of legislation passed in 1925, the Supreme Court
is free to review only those cases it chooses to consider.
At least four of the nine Supreme Court justices have to vote to
grant certiorari in order for Nacchio's appeal to continue, and
that is a statistical long shot, since less than 5 percent of
the cases presented to the Supreme Court are accepted for
consideration. The court routinely limits its review to
cases deciding important federal questions, those establishing
As a consequence, Nacchio can remain free on bond pending final
resolution only if his attorneys can persuade at least one
Supreme Court justice to grant a stay, in anticipation of
certiorari being granted later and the conviction then being set
While still only a possibility, the chances of a stay and
subsequent Supreme Court review are significantly increased by
virtue of the 10th Circuit's split decision, the strongly worded
dissenting opinions and the fact that the admissibility of
arguably esoteric expert witness testimony has been the subject
of several relatively recent and controversial Supreme Court
As frustrating as losing the appeal by a single vote must be to
Nacchio and his attorneys, the fact that it was a fiercely
contested 5-4 decision on a "hot" appeal issue makes Supreme
Court intervention more likely.
Which should dampen the elation felt by federal prosecutors and
disgruntled Qwest investors once Wednesday's court decision was
Scott Robinson is a
trial lawyer specializing in personal injury and criminal