A judge refused to bring an early end to the corporate fraud trial of Richard Scrushy on Thursday, rejecting defense requests to throw out key charges that the fired HealthSouth Corp. chief directed a huge accounting scheme.
The decision by U.S. District Judge Karon Bowdre — who did dismiss one of three other counts accusing Scrushy of violating a new corporate reporting law — set the stage for the defense to call its first witness.
During a hearing away from jurors, Bowdre overruled defense claims that prosecutors, during the first 12 weeks of trial, failed to present enough evidence for jurors to even consider whether Scrushy was involved in a $2.7 billion earnings overstatement.
Bowdre dismissed one of the primary charges against Scrushy — a count accusing him of violating the new Sarbanes-Oxley law by forcing two subordinates to sign a false financial statement in 2002. Bowdre said there was “no evidence” Scrushy made them do anything.
But she refused to throw out another Sarbanes-Oxley charge and said she would rule later on a third Sarbanes-Oxley charge against Scrushy.
Bowdre also refused to dismiss charges accusing Scrushy of conspiracy, securities fraud, wire fraud and filing false statements with the Securities and Exchange Commission, meaning the trial will continue.