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RIP, Ken Lay

Former Enron CEO Ken Lay, who was just convicted on multiple felony counts relating to the fall of his company, died suddenly yesterday at the age of 64.

Convicted Enron Corp. founder Ken Lay suffered a massive coronary Tuesday and died, according to Dr. Steve Wende, of First Methodist Houston. He was 64.

“He and his wife, Linda, were in Colorado for the week, and his death was totally unexpected. Apparently, his heart simply gave out.,” he said in a memo to church staff.

Lay had been awaiting sentencing after being found guilty May 25, 2006, on all six counts that related to Enron fraud, including conspiracy to commit wire fraud, perpetrating wire and bank fraud, and making false and misleading statements to employees at a company meeting, as well as to banks, securities analysts and corporate credit-rating agencies.

His sentencing had been set for Oct. 23.

The Lays owned property in Colorado, the only state outside the Southern District of Texas, which includes Houston, where he was allowed to go before that sentencing.

His attorney during the trial, Mike Ramsey, said today that Lay’s wife, Linda, was with him when he died. Ramsey ‘s own heart problems forced him to miss much of the trial.

I’m sure there will be plenty more on this soon. As you know from reading this site, I’ve never had a particularly high opinion of Lay, but I offer my sympathies and condolences to his family nonetheless. Rest in peace, Ken Lay.

UPDATE: Here’s a fuller obituary. As for the conspiracy theories, well, I suppose this couldn’t hurt.

One thing that will happen now is that the government’s attempt to seize what they say were Lay’s ill-gotten gains from the fall of Enron will likely be dismissed. Link via Tom, who promises more later.

UPDATE: So, does this mean that I’m not one of the “more thoughtful political blogs”, or that I’m an exception to their silence? Enquiring minds want to know.

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11 Comments

  1. Sorry, Chuck, but this is not a case of RIP. This is a case of BIH.

  2. Tim says:

    I’m not suggesting this is the case, but after the conviction I suspected that one of the ways Lay and/or Skilling could flee the country would be to stage their own “death” and flee to Central America while they are off the radar in terms of being a flight risk.

    I’m sure that’s probably not the case, but until I hear someone independently verify (apart from family and family doctors) that there is indeed a body and that it is indeed Ken Lay’s, I can’t completely convince myself to rule out that possibility, however slim.

  3. Charles Hixon says:

    The timing of Lay’s death is curious. Folks of his stature, for instance: Jack Cato, Dick Cheney, and his own attorney Ramsey, were (are) aware of their heart condition.

  4. Tim says:

    It gets better. At least some legal minds believe this means Lay’s convictions are expunged as if they never occurred:

    Question: What happens to Lay’s conviction?

    Answer: Lay’s conviction might be expunged, says criminal law professor Peter Henning in a fascinating post on the White Collar CrimeProf blog. Citing Fifth Circuit law (the federal jurisdiction encompassing Houston), Henning says that when a defendant dies before appellate review of a conviction, the death “abates, ab initio, the entire criminal proceeding.” In a recent Fifth Circuit decision, United States v. Estate of Parsons, the court explained that “the appeal does not just disappear, and the case is not merely dismissed. Instead, everything associated with the case is extinguished, leaving the defendant as if he had never been indicted or convicted.” The Fifth Circuit explained the rationale for the rule: “The finality principle reasons that the state should not label one as guilty until he has exhausted his opportunity to appeal. The punishment principle asserts that the state should not punish a dead person or his estate.”

  5. Charles Hixon says:

    Lay apparently had been cutting down on his jogging regimen:
    http://www.thesmokinggun.com/graphics/art/bushlay1.gif

  6. muse says:

    Is he saying you are thoughtless and loud? Who says?!

  7. Dennis says:

    Watching the local TV newscasts, I heard Rev. William Lawson, a longtime Lay defender, say words to the effect that God had called Ken Lay home early in order to prevent his suffering in prison. Lord save us from the preachers.

  8. Patrick says:

    In a recent Fifth Circuit decision, United States v. Estate of Parsons, the court explained that “the appeal does not just disappear, and the case is not merely dismissed. Instead, everything associated with the case is extinguished, leaving the defendant as if he had never been indicted or convicted.” The Fifth Circuit explained the rationale for the rule: “The finality principle reasons that the state should not label one as guilty until he has exhausted his opportunity to appeal. The punishment principle asserts that the state should not punish a dead person or his estate.”

    Am I the only one that finds this ruling a bit troubling? For the sake of arguement let’s say that I discover that I am terminally ill. In my position I can embezzle tens of millions of dollars from my company. I do so which leads to The company’s collapse and failure. I am convicted of embezzling but while out of jail waiting for an appeal, I eat a bullet. Now dead my family gets to enjoy the fruit of my crime because the court system has no recourse to pursue, ill-gotten gains because they can’t prove they were “ill-gotten”? Or am I reaching too far with my scenario?

  9. Patrick,

    I believe this precedent applies only to seizure attempts that are part of the criminal justice process. In the scenario you present, the entities you defrauded would still be able to sue your estate to recover what you stole from them. This is not perfect, of course, as there are many ways to evade civil judgments, but it’s a pretty strong tool, and your family would be far from fat city.

    As always, I Am Not A Lawyer, so take this with an appropriate dose of salt until a real expert weighs in.

  10. Tim says:

    Patrick,

    My understanding is that the civil trials to recover ill-gotten gains can continue against the family.

    However, Lay’s death would change a few things. For one, they couldn’t use the conviction against him to bolster their case since it would be effectively vacated as if it never happened. There may be other things that are inadmissible because Lay can’t rebut them.

    Nevertheless, there is still evidence that can be used to build a case, and if the preponderance of the evidence still supports a civil verdict against the family, it can happen.