HOUSTON – The judge presiding over the fraud and conspiracy trial of Enron Corp. founder Kenneth Lay and former CEO Jeffrey Skilling isn’t overpowering, but he leaves no question about who’s in charge.
U.S. District Judge Sim Lake doesn’t raise his voice or otherwise draw attention to himself. But he quietly commands respect, and will politely cut off rambling attorneys to keep the proceedings in his Houston courtroom going. He also throws out quips now and then, revealing his witty side.
“Do you have any more Dickens?” he recently asked a defense attorney who quoted the author during a hearing.
“He’s exactly what you would think of if you were to get a judge from central casting – smart and respectful,” said Nancy Rapaport, dean of the University of Houston Law Center. “He’s got the right demeanor for a trial that’s going to take this long and be that serious.”
It’s estimated that the Enron trial will last four months.
“He will be the consummate impartial jurist,” noted Jay Brown, a Houston civil litigator. “He will bend over backward to be extremely fair to both sides.”
Skilling faces 35 counts of fraud, conspiracy, insider trading and lying to auditors for allegedly conspiring to hide Enron’s precarious financial state from investors in the years before the company crashed into bankruptcy in December 2001. Lay faces seven counts of fraud and conspiracy for allegedly perpetuating the scam after Skilling resigned in August that year.
Both men face decades in prison if convicted. They have pleaded not guilty.
Lay also faces one count of bank fraud and three counts of lying to banks in a separate case alleging that he reneged on agreements with banks not to use $75 million in loans to buy margin stock. Lake will decide the outcome of that case in a bench trial to commence shortly after jurors in the conspiracy case begin deliberating.
Lake, 61, a former environmental litigator with Fulbright &Jaworski, was appointed to the federal bench by President Reagan in 1988. He earned his law degree from the University of Texas School of Law in 1969 and was a U.S Army officer from 1970-71.
“He certainly has found his calling,” said Stephen Dillard, a Fulbright &Jaworski partner who worked with Lake before he was appointed to the bench.
Dillard said that, as a trial lawyer, Lake was concise, direct, and wasted neither words nor time. Lake retained those habits as a judge, he said.
Lake also earns consistently high ratings from Houston-area lawyers in the Houston Bar Association’s annual judicial preference poll. In the most recent poll, about 250 lawyers gave Lake nearly 70 percent or higher approval ratings for following the law, treating attorneys courteously, fairness, efficiency and hard work and preparedness. Only one of his eight judicial colleagues in Houston, U.S. District Judge Lee Rosenthal, received higher ratings.
Lake gained attention from white collar crime attorneys across the country nearly two years ago when he sentenced former Dynegy Inc. finance executive Jamie Olis to 24 years in prison for his role in pushing through a 2001 scheme to disguise debt as cash flow.
At the time, Lake was bound by federal sentencing guidelines that required harsh sentences for defendants held responsible for more than $100 million in investor losses tied to the crime. Those guidelines are now advisory only, and an appeals panel last year threw out the sentence because the amount was unreasonable.
Lake has yet to re-sentence Olis, but has indicated he won’t side with Olis’ contention that no specific amount can be attributed to his crime.
And Lake has imposed harsh white-collar crime sentences before.
In October, 1999 he sentenced former day trader Alton Dane Hudnall to 25 years in prison for conspiring with five others to defraud 500 European investors of $53 million in a money laundering scheme. Hudnall was convicted of 26 counts of money laundering, 17 counts of wire fraud and one count of conspiracy.
And in June 1995 Lake sentenced former Houston socialite Teresa Rodriguez to nearly 22 years in prison on 36 counts of wire fraud, mail fraud and money laundering for bilking 375 investors of $69 million.
Talk to us
> Give us your news tips.
> Send us a letter to the editor.
> More Herald contact information.
