Houston – Jury selection began Tuesday for the first of three retrials of five former Enron Corp. broadband executives, whose first trial ended with a hung jury.
The retrial of the one-time executives is being held in the courtroom next to where the fraud and conspiracy trial of Enron founder Ken Lay and former chief executive Jeff Skilling is being conducted.
About 100 potential jurors appeared for the selection process.
Judge Vanessa Gilmore of U.S. District Court said the trial of Kevin Howard, former chief financial officer for Enron’s broadband unit, and Michael Krautz, a former in-house accountant, is expected to last three weeks.
The original broadband trial began in April 2005. Prosecutors allege Howard and Krautz broke accounting rules with “Project Braveheart,” a loan disguised as a sale of future revenues from a video-on-demand deal to investors so the broadband unit could book immediate income in the fourth quarter of 2000 and first quarter of 2001. Those revenues never came because the video- on-demand deal flopped.
The government contends the sale was a sham because investors were promised they would be bought out at a premium.
Howard and Krautz testified that the deal was legitimate and had no buyout guarantee.
The rest of the original broadband trial focused on three other executives accused of overhyping capabilities of Enron’s broadband network and operating software to inflate the stock price and enrich themselves through stock sales.
Gilmore divided the five defendants among three retrials, and the government reindicted all five on fewer counts.
