A little over a month after I started this blog back in early 2004, former Dynegy executive Jamie Olis was sentenced to over 24 years in prison for allegedly cooking Dynegy’s books.

That shocking sentence aroused my interest in the Olis case, so I have followed Olis’ ordeal closely for going on four years.

The tremors from the Olis sentence have been enormous, not the least of which was its impact on various defendants who entered into plea bargains in the Enron-related criminal cases rather than risk a similar quasi-life sentence.

Despite my interest in the Olis case, I have been somewhat frustrated over the years by the lack of available public information regarding the evidence of Olis’ alleged criminal acts. Olis had already been convicted before I even found out about his case, so I didn’t follow his trial and don’t know much about what was presented during it.

However, I do know that the structured finance transaction that was the basis of the charges against Olis — nicknamed “Project Alpha” — was not a particularly unusual transaction for a large company such as Dynegy at the time. I also knew that the transaction had been approved by dozens of accountants and lawyers both inside and outside of Dynegy.

From my experience in defending several former Enron executives, I also knew that government prosecutors neither understood nor cared much to understand the complex structured finance transactions in which companies such as Enron and Dynegy commonly engaged.

Rather, prosecutors knew that obtaining a conviction against business executives in the aftermath of Enron was like shooting fish in a barrel, so it became common for them to criminalize legitimate business transactions where it was far from clear that anything was wrong with the transaction in the first place.

To the extent such transactions should have been subject to litigation at all, they should have been subject solely to civil litigation where the liability for the alleged wrongdoing could be allocated fairly among the dozens of individuals or companies commonly involved in approving such transactions.

So it was with great interest that I read a legal memorandum in support of a motion to set aside Olis’ conviction that a new group of lawyers (including, interestingly, Houston plaintiffs’ lawyer, John O’Quinn) representing Olis filed late last week with U.S. District Judge Sim Lake (Chronicle business columnist Loren Steffy published a copy of the memorandum in a blog post over the weekend and Chronicle legal columnist Mary Flood followed up with a Monday blog post here).

The memorandum is the first document that has been filed in the Olis case that lucidly explains how — as I’ve long suspected — it was far from clear that there was anything wrong with Project Alpha and even farther from clear that Olis had anything to do with any alleged criminal conduct.

Knowing this, the prosecution veered away from its original charges against Olis and ultimately prosecuted him at trial over a “hide the real deal” theory that was entirely different from the one contained in the Olis indictment.

As it turns out, Olis didn’t really hide anything and there is substantial evidence to support his disclosures. However, the Olis’ defense at trial was limited when Dynegy quit funding it as a result of the government’s threat “to go Arthur Andersen” on the company.

Thus, Olis’ defense counsel was overwhelmed and did not find the exculpatory evidence, which the Olis team did not discover until Olis’ lawyer sued Dynegy and recovered a substantial money judgment for failing to fulfill its obligation to fund the Olis criminal defense. The ordeal that Olis and his family have suffered over the past four years is the result of this travesty.

Credit Steffy for getting it right in his blog post calling for Olis’ release from prison (related column here).

However, Steffy’s call for justice in the Olis case is ironic in that he bears a substantial portion of the responsibility for flaming the poisonous anti-business climate in Houston that led to brutal injustices such as the Olis case in the first place.

Let’s remember that the next time someone starts inciting an angry mob.