The two remaining unsentenced former Merrill Lynch executives and the only Enron executive convicted of fraud and conspiracy in the Enron-related criminal trial known as the Nigerian Barge case are being sentenced today by U.S. District Judge Ewing Werlein in Houston.
This morning, one of the two Merrill defendants — Robert Furst — received a similar sentence to those received last month by co-defendants and former Merrill executives, Daniel Bayly and James Brown. As in the previous sentencings, Judge Werlein basically ignored the government’s proposed 15 year sentence for Mr. Furst, and sentenced him to three years, one month in prison and to pay $665,000 in restitution.
The other Merrill defendant — William Fuhs — and the lone Enron defendant — Dan Boyle — are scheduled to be sentenced this afternoon. Mr. Fuhs’ sentence will likely be a bit less than Mr. Furst’s, while Mr. Boyle — a mid-level former Enron executive who the government inexplicably wants to put away for life over this — will probably receive a bit longer sentence than Mr. Furst’s.
Update: This afternoon, Judge Werlein first sentenced Mr. Boyle to three years and 10 months in prison and a $320,000 fine. Late this afternoon, the Judge completed the sentencing in the Nigerian Barge case by sentencing Mr. Fuhs to the same sentence as that of Mr. Furst — 37 months.
Meanwhile, Mr. Bayly’s legal team recently filed this brief with the Fifth Circuit Court of Appeals in support of Mr. Bayly’s request to be allowed to remain out of prison pending disposition of his appeal. The brief previews Mr. Bayly’s arguments on appeal, which are focused on the paucity of direct evidence linking Mr. Bayly to the transaction, the hearsay nature of the evidence that did, and the refusal of Judge Werlein to instruct the jury on a key defense theory. That key defense theory is that an Enron promise to Merrill Lynch to arrange a sale of the barges within six months to a third party — as opposed to an Enron promise to repurchase the barges within that time frame — did not undermine Enron’s accounting of the transaction and did not constitute the basis of a crime. Inasmuch as Enron ultimately arranged for such a sale to a third party as opposed to buying back the barges from Merrill itself, the lack of a jury instruction on that issue appears to be a solid basis for Mr. Bayly’s appeal.