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Andersen reactions



Mens rea means mens rea -- no consciousness of guilt, no criminal liability. Tom Kirkendall comments:

The ruling is a stunning setback for the Department of Justice generally and the Enron Task Force specifically, which pursued a dubious prosecution of Andersen that effectively terminated a going concern that employed 30,000 persons in the U.S. (in comparison, Enron's implosion cost approximately 5,000 employees their jobs). That economic carnage was a stark reminder of the increasingly common governmental regulatory practice of criminalizing merely questionable business transactions, a practice that has been played out over and over again in other aspects of the Enron case and, more recently, in regard to the governmental investigations into American International Group Inc.

Peter Henning observes:

1. It is a 9-0 decision. Reaction - The government had it wrong and the Court thought it clear enough to speak with a single voice....

4. Document retention policies deserve some respect- the Court specifically says that they are "common in business." To say that one "impedes" the government merely because they have and use such a policy is wrong. More should be required.

Other comments: Tony Mauro; Wired GC; WSJ; Stephen Bainbridge; Gordon Smith; Larry Ribstein here, here and here ("If the government couldn�t prove that the conduct was knowingly wrong, it was wrong to proceed to put the firm out of business, even if it thought that lots of people at Andersen were bad actors, and even if could come up with what it thought was a linguistically plausible reading of a criminal statute.").

 

 


Rafael Mangual
Project Manager,
Legal Policy
rmangual@manhattan-institute.org

Katherine Lazarski
Manhattan Institute
klazarski@manhattan-institute.org

 

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The Manhattan Insitute's Center for Legal Policy.