Legal News

Barring 11th-Hour Reprieve, Nacchio to Report to Prison Tuesday

By Ashby Jones

When we last used our waterfall metaphor in regard to Joe Nacchio, the former Qwest CEO convicted two years ago on insider-trading charges, an inquiring reader asked if we’d bring Nacchio back up the fall if and when the Supreme Court reversed his conviction. Our answer: absolutely. We’ll airlift him back and deposit him safely on the riverbank, well out of harm’s way. We might also give him a blanket and a picnic basket stuffed with goodies.

But for now, things don’t look so good. His fall is about to begin. On Monday, the Tenth Circuit denied his request for bail pending the Supreme Court’s decision on whether to take up his case. Barring an eleventh-hour reprieve Tuesday morning from Supreme Court Justice Stephen Breyer, who oversees the Tenth Circuit, Nacchio will report to prison later today. Click here for the story, from the WSJ’s Dionne Searcey.

Nacchio, 59 years old, is slated to arrive at the Schuylkill minimum security camp in Minersville, Pa., at noon Tuesday.

Mr. Nacchio’s lawyer, Maureen Mahoney, declined to comment.

The start of Nacchio’s prison sentence doesn’t necessarily mark the end of his legal battles, however. Mahoney has appealed his conviction to the U.S. Supreme Court and said in a court filing she expects others including the U.S. Chamber of Commerce, to file briefs in support.

An attorney for the Chamber said the brief would ask the court to clarify the internal information that can make CEOs guilty of insider trading. Nacchio’s attorneys also have asked for a new trial after a witness against him recently offered sworn statements that seemed to conflict with testimony at his criminal trial. Nacchio also faces a civil suit from the SEC, which was on hold while other legal issues tied to his criminal case were clarified. The SEC is seeking to bar him from serving as a director or officer of another public company as well as seeking to obtain various ill-gotten gains and penalties.

Nacchio requested to spend his six years in Schuylkill because of its proximity to his wife, who has a home in New Jersey. According to a prison spokesman, Nacchio, inmate number 33973-013, will join 287 others and be offered meals that are “heart-healthy alternatives to processed or fried foods” as well as a dormitory-style cubicle he will share with another prisoner. He will be assigned a job and receive pay of up to 40 cents an hour.

Full post as published by Law Blog - WSJ.com on April 14, 2009 (boomark / email).