Skilling v. US, 08-1394.

Decision Date01 March 2010
Docket NumberNo. 08-1394.,08-1394.
Citation130 S.Ct. 2896
PartiesJeffrey K. SKILLING, Petitioner, v. UNITED STATES.
CourtU.S. Supreme Court
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Todd G. Scher, for Petitioner.

Scott D. Makar, for Respondent.

Elena Kagan, Solicitor General, Mythili Raman, Acting Assistant Attorney General, Michael R. Dreeben, Deputy Solicitor General, David A. O'Neil, Assistant to the Solicitor General, Joel Gershowitz, Kevin Gingras, Department of Justice Washington, D.C., for Respondents.

Daniel M. Petrocelli, M. Randall Oppenheimer, Matthew T. Kline, David J. Marroso, O'Melveny & Myers LLP, Los Angeles, California, Walter Dellinger, Jonathan D. Hacker, Sri Srinivasan, Irving L. Gornstein, Meaghan McLaine VerGow O'Melveny & Myers LLP, Washington, D.C., for Petitioner.

Justice GINSBURG delivered the opinion of the Court.

In 2001, Enron Corporation, then the seventh highest-revenue-grossing company in America, crashed into bankruptcy. We consider in this opinion two questions arising from the prosecution of Jeffrey Skilling, a longtime Enron executive, for crimes committed before the corporation's collapse. First, did pretrial publicity and community prejudice prevent Skilling from obtaining a fair trial? Second, did the jury improperly convict Skilling of conspiracy to commit "honest-services" wire fraud, 18 U.S.C. §§ 371, 1343, 1346?

Answering no to both questions, the Fifth Circuit affirmed Skilling's convictions. We conclude, in common with the Court of Appeals, that Skilling's fair-trial argument fails; Skilling, we hold, did not establish that a presumption of juror prejudice arose or that actual bias infected the jury that tried him. But we disagree with the Fifth Circuit's honest-services ruling. In proscribing fraudulent deprivations of "the intangible right of honest services," § 1346, Congress intended at least to reach schemes to defraud involving bribes and kickbacks. Construing the honest-services statute to extend beyond that core meaning, we conclude, would encounter a vagueness shoal. We therefore hold that § 1346 covers only bribery and kickback schemes. Because Skilling's alleged misconduct entailed no bribe or kickback, it does not fall within § 1346's proscription. We therefore affirm in part and vacate in part.

I

Founded in 1985, Enron Corporation grew from its headquarters in Houston, Texas, into one of the world's leading energy companies. Skilling launched his career there in 1990 when Kenneth Lay, the company's founder, hired him to head an Enron subsidiary. Skilling steadily rose through the corporation's ranks, serving as president and chief operating officer, and then, beginning in February 2001, as chief executive officer. Six months later, on August 14, 2001, Skilling resigned from Enron.

Less than four months after Skilling's departure, Enron spiraled into bankruptcy. The company's stock, which had traded at $90 per share in August 2000, plummeted to pennies per share in late 2001. Attempting to comprehend what caused the corporation's collapse, the U.S. Department of Justice formed an Enron Task Force, comprising prosecutors and FBI agents from around the Nation. The Government's investigation uncovered an elaborate conspiracy to prop up Enron's short-run stock prices by overstating the company's financial well-being. In the years following Enron's bankruptcy, the Government prosecuted dozens of Enron employees who participated in the scheme. In time, the Government worked its way up the corporation's chain of command: On July 7, 2004, a grand jury indicted Skilling, Lay, and Richard Causey, Enron's former chief accounting officer.

These three defendants, the indictment alleged,

"engaged in a wide-ranging scheme to deceive the investing public, including Enron's shareholders, ... about the true performance of Enron's businesses by: (a) manipulating Enron's publicly reported financial results; and (b) making public statements and representations about Enron's financial performance and results that were false and misleading." App. ¶ 5, p. 277a.

Skilling and his co-conspirators, the indictment continued, "enriched themselves as a result of the scheme through salary, bonuses, grants of stock and stock options, other profits, and prestige." Id., ¶ 14, at 280a.

Count 1 of the indictment charged Skilling with conspiracy to commit securities and wire fraud; in particular, it alleged that Skilling had sought to "depriv[e] Enron and its shareholders of the intangible right of [his] honest services." Id., ¶ 87, at 318a.1 The indictment further charged Skilling with more than 25 substantive counts of securities fraud, wire fraud, making false representations to Enron's auditors, and insider trading.

In November 2004, Skilling moved to transfer the trial to another venue; he contended that hostility toward him in Houston, coupled with extensive pretrial publicity, had poisoned potential jurors. To support this assertion, Skilling, aided by media experts, submitted hundreds of news reports detailing Enron's downfall; he also presented affidavits from the experts he engaged portraying community attitudes in Houston in comparison to other potential venues.

The U.S. District Court for the Southern District of Texas, in accord with rulings in two earlier instituted Enron-related prosecutions,2 denied the venue-transfer motion. Despite "isolated incidents of intemperate commentary," the court observed, media coverage "ha[d] [mostly] been objective and unemotional," and the facts of the case were "neither heinous nor sensational." App. to Brief for United States 10a-11a.3 Moreover, "courts ha[d] commonly" favored "effective voir dire ... to ferret out any [juror] bias." Id., at 18a. Pretrial publicity about the case, the court concluded, did not warrant a presumption that Skilling would be unable to obtain a fair trial in Houston. Id., at 22a.

In the months leading up to the trial, the District Court solicited from the parties questions the court might use to screen prospective jurors. Unable to agree on a questionnaire's format and content, Skilling and the Government submitted dueling documents. On venire members' sources of Enron-related news, for example, the Government proposed that they tick boxes from a checklist of generic labels such as "[t]elevision," "[n]ewspaper," and "[r]adio," Record 8415; Skilling proposed more probing questions asking venire members to list the specific names of their media sources and to report on "what st[ood] out in [their] mind[s]" of "all the things [they] ha[d] seen, heard or read about Enron," id., at 8404-8405.

The District Court rejected the Government's sparer inquiries in favor of Skilling's submission. Skilling's questions "[we]re more helpful," the court said, "because [they] [we]re generally ... openended and w[ould] allow the potential jurors to give us more meaningful information." Id., at 9539. The court converted Skilling's submission, with slight modifications, into a 77-question, 14-page document that asked prospective jurors about, inter alia, their sources of news and exposure to Enron-related publicity, beliefs concerning Enron and what caused its collapse, opinions regarding the defendants and their possible guilt or innocence, and relationships to the company and to anyone affected by its demise.4

In November 2005, the District Court mailed the questionnaire to 400 prospective jurors and received responses from nearly all the addressees. The court granted hardship exemptions to approximately 90 individuals, id., at 11773-11774, and the parties, with the court's approval, further winnowed the pool by excusing another 119 for cause, hardship, or physical disability, id., at 11891, 13594. The parties agreed to exclude, in particular, "each and every" prospective juror who said that a preexisting opinion about Enron or the defendants would prevent her from impartially considering the evidence at trial. Id., at 13668.

On December 28, 2005, three weeks before the date scheduled for the commencement of trial, Causey pleaded guilty. Skilling's attorneys immediately requested a continuance, and the District Court agreed to delay the proceedings until the end of January 2006. Id., at 14277. In the interim, Skilling renewed his change-of-venue motion, arguing that the juror questionnaires revealed pervasive bias and that news accounts of Causey's guilty plea further tainted the jury pool. If Houston remained the trial venue, Skilling urged that "jurors need to be questioned individually by both the Court and counsel" concerning their opinions of Enron and "publicity issues." Id., at 12074.

The District Court again declined to move the trial. Skilling, the court concluded, still had not "establish[ed] that pretrial publicity and/or community prejudice raise[d] a presumption of inherent jury prejudice." Id., at 14115. The questionnaires and voir dire, the court observed, provided safeguards adequate to ensure an impartial jury. Id., at 14115-14116.

Denying Skilling's request for attorney-led voir dire, the court said that in 17 years on the bench:

"I've found ... I get more forthcoming responses from potential jurors than the lawyers on either side. I don't know whether people are suspicious of lawyers—but I think if I ask a person a question, I will get a candid response much easier than if a lawyer asks the question." Id., at 11805.

But the court promised to give counsel an opportunity to ask follow-up questions, ibid., and it agreed that venire members should be examined individually about pretrial publicity, id., at 11051-11053. The court also allotted the defendants jointly 14 peremptory challenges, 2 more than the standard number prescribed by ...

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