Johnson and Ahrens Discuss the Week Ahead: Prosecutors Gets a Turn at Skilling

Former Enron chief executive Jeffrey Skilling spent all four days of last week's trial under friendly questioning from his lawyer, Dan Petrocelli. Starting Monday, it's the government's turn.

Federal prosecutor Sean Berkowitz will lead the cross-examination. Prosecutors have charged Skilling with 28 counts of fraud, conspiracy and insider trading. Skilling testified that he is innocent of all charges.

On Sunday afternoon, I sat down with my colleague, Washington Post Business reporter Carrie Johnson. She has been covering this trial -- now entering its 12th week -- since its beginning (and the overall Enron scandal since its early days in 2002).

Frank: Carrie, thanks for taking time to answer a few questions for the readers. What can you tell us about Berkowitz? What's his style like, compared to what we saw from Petrocelli last week? How did Berkowitz's mood seem during Petrocelli's questioning of Skilling?

Carrie: Sean Berkowitz, 38, is an assistant U.S. Attorney in Chicago who took the helm of the Justice Department's Enron Task Force last year. He joined the task force in late 2003 and did a lot of investigatory work on both Skilling and Lay. Friends and colleagues say Berkowitz is known for being calm and understated, rather than flashy, in his approach. He won the confidence of colleagues in Chicago and of the U.S. Attorney there, Patrick Fitzgerald, who is well known in Washington these days for winning an indictment against former vice presidental aide Scooter Libby.

Before joining the government Berkowitz worked as a securities defense lawyer at a Chicago law firm, so he knows quite a bit about practicing law as both a prosecutor and a defense attorney.

Last week Berkowitz wrote quite a few notes to himself during Skilling's testimony. He is likely to try to undermine Skilling's credibility by pointing to contradictions in statements he made to securities regulators, lawmakers and other investigators after Enron's December 2001 collapse into bankruptcy protection.

Interested readers might want to check out a profile of the government team I wrote in January.

Frank: At times last week, it seemed as though Petrocelli was attempting to refute the government indictment line-by-line. But were there tough elements of the indictment that he did not tackle, or that he tread lightly on, that Berkowitz may seek to exploit?

Carrie: Petrocelli walked the jury through the indictment, paragraph by paragraph. He spent a lot of time trying to persuade jurors that there was no overarching conspiracy in which Skilling engaged. Indeed, at one point he asked his client if he were "smart" enough to engage in such a scheme and not get caught for years. Skilling said he wasn't.

During his direct testimony, Skilling displayed a remarkable ability to discourse at great length about Enron's business practices, as well as about pricing models and trading risks. But he said he could not recall an alleged trick to increase the company's reported earnings by a penny to meet analyst estimates in 1999. And he claimed to have no recollection of a Sept. 6, 2001, phone call in which he tried to sell 200,000 Enron shares -- even though prosecutors played an audiotape of Skilling's call to his broker at Charles Schwab for the jury earlier in the trial.

Look for tough questioning by prosecutors on those two areas, as well as others.

Frank: After the cross-examination of Skilling, will there be another round of defense questioning or will Skilling be done?

Carrie: Petrocelli is likely to have some extra questions for Skilling at the end of his cross examination, particularly if the government succeeds in raising questions about his credibility. George "Mac" Secrest, a lawyer for co-defendant Ken Lay, told the judge late last week that he would forgo questioning of Skilling. Both men have presented a pretty united front to date.

Frank: Who comes after Skilling?

Carrie: Defense lawyers said last week that Skilling will be followed by a trio of character witnesses, including a woman who had been an executive in Enron's wholesale division. After that, expect to see a couple of fact witnesses for fellow defendant Ken Lay. Those include his son-in-law, Beau Herrold, who handled his personal finances, and a woman named Cindy Olson, who led Enron's human resources unit.

Frank: Thanks much, Carrie. See you in court this week.

By Frank Ahrens |  April 17, 2006; 8:02 AM ET  | Category:  Dispatches
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Posted by: Caesar Gott | April 17, 2006 10:25 PM

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