WASHINGTON, June 1 – LAWFUEL – The Law News Network — In a decision widely regarded as having a profound impact on the way in which business is conducted throughout the United States, the accounting firm Arthur Andersen LLP has prevailed in its appeal to the Supreme Court of a conviction on charges related to its work for
Enron (Case No. 04-368, Arthur Andersen LLP vs. United States). In a
unanimous opinion written by Chief Justice William Rehnquist, the Supreme
Court reversed and remanded for further proceedings a Court of Appeals
decision that had upheld Andersen’s conviction for “corruptly persuading”
employees to discard documents pursuant to terms of its document retention
policy. “Only persons conscious of wrongdoing can be said to ‘knowingly (and)
… corruptly persuade’,” said the Opinion of the Court, citing the statute
under which Andersen was indicted. “The jury instruction failed to convey the
requisite consciousness of wrongdoing. Indeed, it is striking how little
culpability the instruction required.”
The case was argued by Maureen Mahoney, a partner in the Washington, D.C.
office of Latham & Watkins LLP, who worked with Andersen’s counsel and
attorneys of the firm’s appellate and constitutional practice. Mahoney
commented: “We are very grateful that the Supreme Court has reversed
Andersen’s conviction. Hopefully, this decision begins to thaw some of the
chilling effects on routine business functions that resulted in the wake of
Andersen’s conviction.”
A Texas federal court jury had convicted Arthur Andersen in June 2002 of
obstructing an official proceeding of the Securities and Exchange Commission,
and the federal Court of Appeals for the Fifth Circuit affirmed the conviction
prior to the Supreme Court agreeing to hear the case.
