No Delay in Enron Broadband Trial

U.S. District Judge Vanessa Gilmore late last week rejected a request by seven former Enron Broadband Services executives to reschedule their trial, AP reported.

The trial of the former executives of Enron Corp.’s defunct broadband unit will begin Oct. 4.

She also rejected requests from several of the defendants to be tried separately from the group, so all seven will face a jury together, even though the case against five of them is much broader, according to AP.

Five defendants are charged with conspiracy, fraud, insider trading and money laundering: former CEOs Kenneth Rice and Joseph Hirko, former chief operating officer Kevin Hannon and former vice presidents Scott Yeager and Rex Shelby.

The other two are charged with conspiracy, fraud and lying to the FBI: former VP of finance Kevin Howard and former senior director of accounting Michael Krautz.

The saga began when Howard and Krautz pled not guilty in April 2003 to 19 counts.

The pair was accused of recording $111 million in bogus revenue stemming from a 20-year contract with Blockbuster Inc. to create an online movie-video service. The deal, struck in 2000, was terminated one year later with no real revenue ever recorded

According to the indictment filing, Howard and Krautz devised a financial scheme that let them recognize future revenue anticipated from the deal.

They then created a joint venture based on that revenue and gained investment commitments from video-on-demand-systems provider nCUBE Corp. and Thunderbird, an investment fund controlled by Enron.

Later, the two executives sold the venture to Canadian Imperial Bank of Commerce, according to the indictment.

A superseding indictment unsealed May 1, 2003, added the other five defendants to the case.