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ken lay died an innocent man believe it or not Ken Lay Died an Innocent Man, Believe It or Not

July 6 - Six weeks ago, Kenneth Lay stood outside the Houston courthouse where he had just been convicted of multiple crimes and declared, ``I am innocent of the charges against me.''

Those words came true when his heart stopped pumping yesterday. Yes, Kenneth Lay, that most notorious of corporate wrongdoers, died an innocent man in the eyes of the law.

When a defendant dies, ``the general rule is that if the conviction hasn't gotten past the first appeal, it is supposed to be abated, dismissed, conviction erased,'' says Stanford University law professor Robert Weisberg.

Lawyers for Lay, who was to have been sentenced in October, have taken only the first step toward challenging his conviction. Appealing it would have taken months, possibly years.

And so, Lay's death erases the criminal conviction that it took the federal government 4½ years to win.

The federal appeals court whose rulings apply in Texas has repeatedly said a conviction isn't final until it is reviewed and affirmed, assuming the defendant challenges the verdict. It said so again in a 2004 ruling involving a West Texan named Andrew Parsons, who died while appealing his conviction for arson, insurance fraud and money laundering.

``The case is not merely dismissed'' because of Parsons's death, the Fifth U.S. Circuit Court of Appeals ruled. ``Instead, everything associated with the case is extinguished, leaving the defendant as if he had never been indicted or convicted.''

Oft-Used Principle

The principle is called ``abatement ab initio,'' the Latin portion meaning ``from the beginning.'' It is a ``well- established and oft-used principle,'' the Fifth Circuit court said.

So when it comes to Lay, it's as if the Justice Department never established a special Enron Task Force, never deployed armies of lawyers and agents to determine his role in Enron's collapse, never strong-armed Enron employees to give evidence, never won an indictment, and, finally, never spent months persuading a jury to convict him.

It probably means the prosecution can't get restitution for those victimized by Lay's fraud, though the Fifth Circuit ruling in the Parsons case was more divided on that point. And Lay's death will most certainly complicate government efforts to seize whatever property of his is left. That amounts to about $7.8 million, according to court papers filed last week by prosecutors, who put Lay's ill-gotten gains at $43.5 million.

Good on Paper

Abatement ab initio is the sort of legal principle that may look good on paper but seems ridiculous in real life.

``The state should not label one as guilty who has not exhausted his opportunity'' to file an appeal, the court said. Also, ``The state should not punish a dead person or his estate,'' the Fifth Circuit judges explained.

It doesn't matter that, in Lay's case, his conviction came after a scrupulously fair trial, with skilled lawyers on both sides and a conscientious jury weighing the evidence.

``It's pretty clear here that unless some extraordinary grounds are found, it's just going to be erased,'' Weisberg says.

For employees, investors and other creditors with civil suits against Lay, abatement of the conviction wouldn't be catastrophic but could deny them ``an extra little evidentiary advantage,'' he says.

Beyond whatever legal fights ensue over what's left of Lay's once-grand wealth, there is the matter of simple retribution.

Seeking Punishment

``I wanted to see him punished, but not dead,'' Charles Prestwood, a retired Enron employee who lost $1.3 million in retirement savings when the company collapsed, said yesterday in a telephone interview from his home near Houston.

Lay had said he felt punished already. And yet the remarkable arc of his life stopped just short of its probable nadir.

No humiliating sentencing. No tongue-lashing from the judge. No bedding down on government cots and seeing nothing ahead but year after year in federal prison.

Lay's death ``ultimately robs the government of any complete closure on this matter and leaves open some lingering issues as to whether Ken Lay would have had an opportunity to prevail on appeal,'' says Robert Mintz, a former federal prosecutor and now white-collar defense lawyer in Newark, New Jersey.

Frustrating as all of that is, none of it changes the fact that Lay was, in fact, found guilty by 12 Texans.

Whatever the law says, Lay will remain guilty, very guilty, to the public at large. But then, most of the public didn't need a jury to tell them that in the first place.