DENVER-
Former Qwest Communications chief Joe Nacchio, looking fit and upbeat, watched prospective jurors with interest and actively consulted with attorneys as jury selection began Monday in his $101 million insider trading trial.
U.S. District Judge Edward Nottingham kept the mood in the courtroom light and laced with humor as the prospects were asked about news coverage of the case, whether they knew any of the potential witnesses, had contact with law enforcement agencies and other questions.
Eighteen people were assigned to the jury box with several dozen more prospects seated in the spectator section. Representatives of the news media and a handful of spectators filled the remaining seats.
Nottingham ended the session after 8 1/2 hours without finalizing a panel. In all, 11 people were excused after being questioned about their exposure to media coverage of the case, personal hardships or other issues.
For example, one potential juror was released after she told the judge she had attended accounting seminars where the Qwest accounting scandal had been discussed. Another was excused because of his responsibilities on a family farm. In addition, 14 prospects were dismissed through challenges by either prosecutors or defense attorneys with no reason provided.
Before dismissing the prospective jurors for the night, Nottingham reminded them not to read or discuss the case with anyone. Earlier in the day, he admonished representatives of news organizations to stay away from the prospective jurors. “Nobody is to be talking to the jurors,” he said.
Jury selection was to resume Tuesday morning. Nottingham wants to seat 12 jurors and six alternates for the trial, which is expected to last up to eight weeks.
Nacchio, 57, declined comment as he entered and left the courthouse with his wife, other relatives and his legal team around him. He is accused of improperly selling about $101 million worth of stock while privy to nonpublic information that Qwest Communications International Inc. was at financial risk. The Denver-based telephone company soon after became mired in an accounting scandal and eventually was forced to restate $2.2 billion in revenue.
Nacchio is charged with 42 counts of insider trading for stock sales in the first five months of 2001. Each count carries a penalty of up to 10 years in prison and a $1 million fine.
Nacchio’s defense strategy includes the argument that he was optimistic about the company’s future because he expected Qwest to win contracts worth millions of dollars from clandestine government agencies.
Nottingham handled the bulk of the initial questioning, asking prospective jurors about the potential hardships of serving for up to two months on the panel, physical disabilities or their knowledge of the case against Nacchio.
He also asked individuals about experiences with law enforcement and the legal system and their thoughts on executive compensation.
At times during the day, it was difficult to hear the prospects answer questions or the attorneys speaking away from microphones.
Prosecutors and defense attorneys also read to prospects a list of potential witnesses to see if they were acquainted with them. On that list was Qwest Communications founder Phil Anschutz, former Qwest finance chiefs Robin Szeliga and Robert Woodruff and former Qwest President Afshin Mohebbi.
Nacchio’s indictment stems from a yearslong government investigation into the accounting scandal that nearly sank Qwest.
Federal regulators say Qwest falsely reported sales of capacity on fiber optic cables as recurring instead of one-time revenue between April 1999 and March 2002.
That allowed the company to improperly report approximately $3 billion in revenue, which helped pave the way for its 2000 acquisition of former Baby Bell U S West Inc., the Securities and Exchange Commission has charged.
Nacchio also is a defendant in an SEC civil fraud case stemming from the scandal.
