July 05, 2006
Ken Lay Dies at 64
Posted by Christine Hurt

I hate to interrupt the Workshop, but the Houston Chronicle is reporting that Ken Lay has died from a heart attack in Colorado.

UPDATE:  Peter Henning explains how Lay's death extinguishes the criminal case against him under appeal, preserves his estate against the forfeiture action, and may create a collateral estoppel argument that plaintiffs in the civil case cannot use Lay's conviction as any evidence in the civil case against him.  Wow.  Larry Ribstein also weighs in.

Enron | Bookmark

TrackBacks (0)

TrackBack URL for this entry:

Links to weblogs that reference Ken Lay Dies at 64:

Comments (5)

1. Posted by PK on July 5, 2006 @ 9:54 | Permalink

My heart goes out to his family, this is a really sad day for them.

2. Posted by Jake on July 5, 2006 @ 18:42 | Permalink

Interesting comment by Prof. Ribstein: "No doubt Ken Lay’s death will be satisfying to those who think he’s getting his just deserts." Rank and ignoble conjecture about the reactions of Lay's critics now masquerades as scholarly comment? Give me a break, please.

3. Posted by Jake on July 5, 2006 @ 19:08 | Permalink

Any plaintiffs who seek to apply collateral estoppel applies in subsequent civil suits, as a result of the guilty verdict the jury rendered against the late Mr. Lay, seem to be on pretty firm ground. The Fifth Circuit spoke to this question in RecoverEdge L.P. v. Pentecost, 44 F.3d 1284, 1295 (5th Cir. 1995), stating:

"At oral argument, RecoverEdge also argued that collateral estoppel does not apply to this case because there was no final judgment in the conspiracy case. This argument is legally and factually inaccurate. RecoverEdge's predecessor, the RTC, successfully moved the court to accept the jury's verdict and later to enter final judgment pursuant to Rule 54(b) of the Federal Rules of Civil Procedure. Furthermore, a final judgment is not a prerequisite for issue preclusion when a jury has rendered a conclusive verdict. See Restatement (Second) of Judgments § 13 (1982) ( “The rules of res judicata are applicable only when a final judgment is rendered. However, for purposes of issue preclusion, ··· ‘final judgment’ includes any prior adjudication of an issue in another action that is determined to be sufficiently firm to be accorded conclusive effect.” )."

And in Cycles, Ltd. v. Navistar Financial Corp., 37 F.3d 1088, 1090 (5th Cir. 1994), the Fifth Circuit stated:

"Judgments are final for purposes of issue preclusion when fully litigated, even if not yet appealable. See Chemetron Corp. v. Business Funds, Inc., 682 F.2d 1149, 1191 (5th Cir.1982) (holding that a fully litigated, if non-final, decision enjoys issue-preclusive effect); vacated and remanded on other grounds,460 U.S. 1007, 103 S.Ct. 1245, 75 L.Ed.2d 476 (1983); reinstated on remand as to this ground,718 F.2d 725, 728 (5th Cir.1983); reh'g en banc ordered, id. at 730 (vacating opinion for rehearing en banc, which never occurred because parties settled); see also18 Charles A. Wright et al., Federal Practice and Procedure § 4434, at 321 (1981) (surveying leading cases that consider non-appealable judgments to be final for purposes of issue preclusion); 1B James W. Moore et al., Moore's Federal Practice ¶ 0.416[3.-1] (2d ed. 1993) (endorsing rule that pendency of post-trial motions to change the judgment or set it aside does not suspend issue-preclusive effect of the judgment); Restatement (Second) of Judgments § 13 cmt. f (1982) (pendency of motions to set aside a judgment otherwise final for collateral estoppel purposes or to grant a new trial does not suspend issue-preclusive effect of the judgment)."

4. Posted by Peter Henning on July 6, 2006 @ 6:29 | Permalink

Although I don't think the jury's verdict in the criminal trial will be admissible in a later case because of the abatement of the conviction and charge, Lay's testimony and other statements would be admissible in a subsequent civil proceeding (either the SEC case or the securities fraud class action) against his estate. While the conviction is gone, the evidence is still there (at least so says my evidence guru, Professor Dave Moran, who knows all things evidentiary).

5. Posted by anon on July 6, 2006 @ 8:43 | Permalink

Jake: "Rank and ignoble conjecture about the reactions of Lay's critics now masquerades as scholarly comment? Give me a break, please."

You should check out some of the unfortunate comments at the WSJ's law blog.

Post a comment

If you have a TypeKey or TypePad account, please Sign In

Recent Comments
Popular Threads
Search The Glom
The Glom on Twitter
Archives by Topic
Archives by Date
August 2016
Sun Mon Tue Wed Thu Fri Sat
  1 2 3 4 5 6
7 8 9 10 11 12 13
14 15 16 17 18 19 20
21 22 23 24 25 26 27
28 29 30 31      
Miscellaneous Links