Although overshadowed by the Enron-related criminal cases, the business fraud criminal trial of former Westar Energy, Inc. CEO David Wittig and his right hand man has been making quite a bit of news over the past few months in Kansas. U.S. District Judge Julie Robinson on Monday declared a mistrial in the case when the jury could not render a verdict on most of the 40 count indictment against the defendants. Although the prosecution can (and probably will) re-try a case that ends in a mistrial rather than an acquittal, the result of the trial was a clear victory for the defense.
The mistrial comes a year and a half after another federal jury convicted Mr. Wittig of bank fraud charges in a case not directly related to Westar. Mr. Wittig remains free on bond pending his appeal of that conviction.
Mr. Wittig and former Westar Executive Vice President Douglas T. Lake each faced charges relating to allegations they tried to loot the largest electric utility in Kansas. The pair left Westar late in 2002 amid revelations of misuse of corporate funds. Subsequently, Westar under Mr. Wittig was implicated in the scandal surrounding corporate efforts to curry favor with Houston congressman Tom DeLay, the House majority leader. A Travis County, Texas grand jury continues to investigate Westar’s contributions of funds during 2002 to the political action committee that Mr. DeLay created.
Mr. Wittig, who is a former star deal maker at Salomon Brothers, became CEO of Westar in 1998 and immediately turned the sleepy Midwestern utility into a deal machine. Mr. Wittig hired Mr. Lake, who worked with him at Salomon. Mr. Wittig was paid compensation of more than $25 million in his seven years Westar, and he had no reservations about showing it in normally conservative Topeka, where Westar is based. He bought the largest home in Topeka, which is a 17,000-square-foot mansion that former Kansas governor and one-time presidential candidate Alf Landon built, which he then outfitted in with over $2 million in art and interior decoration. Mr. Wittig also drove around Kansas in a $230,000 Ferrari 550 Maranello.
After some success, Mr. Wittig’s fast deal plan at Westar faltered and the company’s stock price fell from $44 to $9. As a result, Westar came under increasing pressure from shareholders and regulators, including the Travis County grand jury.
The trial has been particularly wild. Judge Robinson, who is a former prosecutor, and Mr. Wittig’s defense attorneys — Adam Hoffinger and Edward Little — butted heads throughout the trial as the defense accused the judge of favoring the prosecution in her rulings. At several points during the trial, Judge Robinson angrily lectured the attorneys for their courtroom demeanor, which included rolling their eyes during witness testimony. Finally, a day before closing statements, the friction between the judge and the defense attorneys boiled over as Judge Robinson took the extraordinary measure of barring one of the attorneys on Mr. Lake’s defense team from the courtroom for the remainder of the trial.
For excellent background on Westar’s involvement with Rep. DeLay, the PAC, and the Travis County investigation, check out Charles Kuffner’s comprehensive posts.

Parties involved in the Yukos chapter 11 case on Monday were attempting to discover information regarding Baikal Finance Group, which was the obscure winner of Sunday’s Russian government auction of the Yukos oil unit Yuganskneftegaz (“Yugansk”). Several news services reported late Monday that at least two representatives of Baikal are employees of Siberian-based oil and gas major, OAO Surgutneftegaz. Although Surgutneftegaz announced after the Sunday auction that it had no ties to Baikal Finance, speculation is increasing that Surgutneftegaz is providing or backing financing in some manner for Baikal Finance.
Here is the Wall Street Journal’s ($) more thorough coverage of the aftermath of the Russian government’s auction of the Yukos oil and gas production unit.
Meanwhile, in this op-ed in today’s Journal, former Russian chess champion Garry Kasparov pulls no purches regarding the implications from Western acceptance of the Russian government’s handling of Yukos:

If the West won’t stand up for basic human rights and democratic principles in Russia, one last hope was that it would come to the aid of free enterprise. But the only voice of protest against this weekend’s auction of Russian oil giant Yukos’s main asset came from Texas, and it wasn’t George W. Bush — it was a bankruptcy court in Houston. Needless to say, the auction of Yuganskneftegaz went forward on Sunday in Moscow despite the court order.
With the Russian state gas company Gazprom in a potential legal tangle over the injunction, the auction was won by a completely unknown entity from the Russian hinterlands that just happened to have $9.3 billion cash on hand. This company will soon prove to be the outer layer of a Russian matryoshka doll. We’ll find a Gazprom doll inside of that one and, like every matrioshka today, at the center will be Vladimir Putin.

Mr. Kasparov concludes with the following insight:

Perhaps Western leaders agree with last week’s New York Times editorial that made the stunning assertion that “a fascist Russia is a much better thing than a Communist Russia.” I hope I am allowed to order something not on that menu. I am not ready to throw up my hands and surrender to the Putin dictatorship. It is still possible to stand up to the dictator and to fight for democracy.
In March, 1991, then-President George H.W. Bush and his European counterparts were still supporting Mikhail Gorbachev’s futile domestic endeavors. I wrote then that if we were left alone we would soon have no Gorbachev and no communism. Now we need to say no to Vladimir Putin and no to fascism. If the United States and the European powers are not willing to help us in this new fight, at the very least they should stay out of the battle and stop giving aid to the forces of fascism.