Enterasys jury selection moves forward

Dennis, a software engineer, won’t be sitting on a jury deciding the fate of five former executives of Cabletron Systems spinoff Enterasys Networks whose securities fraud trial got under way Tuesday in federal District Court in Concord.

Dennis, who was called as a prospective juror, had some friends at Cabletron and Enterasys who told him “awful stories about Craig Benson” and said that it was a horrible place to work.

Cabletron co-founder Craig Benson, the former New Hampshire governor, never even worked at Enterasys, has never been charged, and probably won’t even be called as a witness. Yet the first item that defense lawyers wanted the judge to question prospective jury members about was whether their opinion of Cabletron – a Rochester firm that was once the state’s largest employer – or Benson might bias them in this case.

“I’m not sure,” said Dennis. “I might tend to be negative.”

Jurors also had to address more general questions about corporate misconduct: Were they a victim of fraud of any kind? Have they ever lost a lot of money in the stock market? Did they follow any securities scandal in the media? Did they have strong opinions about CEOs? Did they work for the federal government? Did they know anyone in law enforcement? Were they ever involved in an audit?

And then there were all the usual reasons to excuse jurors in a trial that — Judge Paul Barbadoro estimated – would take four to six weeks: teachers who can’t leave the classroom, workers living from paycheck to paycheck, single mothers taking care of young children.

By the end of the day, nearly all of the pool of 49 potential jurors was picked.

While defense attorneys couldn’t directly question prospective jurors, they could ask the judge to explore whether their answers to a questioner prevented them from being impartial. And Barbadoro almost always complied.

Peter was excused after writing that he thought that CEOs are for themselves and the “workers, even the country, be damned.”

So was Candice, who believes CEOs should be held to a “higher standard.”

Susan, who sold securities for an insurance company, was ruled out, after she said she thought that the defendants might be guilty “because obviously something has to be there when it comes to trial and it angers me because it taints my profession.”

Andrea blamed the loss of her job on “corporate misdeeds” at Consolidated Freight Corporation, and even joined a suit against the company (and won a settlement) because it didn’t give workers the required notice. She wrote that CEOs who cause significant losses to their workers “should be sent to jail for life.”

Not everyone touched by corporate misdeeds was ruled out.

There was Aaron, who had a friend who worked for Enron who lost his savings in a 401(k). He was allowed into the pool because “you can’t stereotype based on a few cases.”

Then there was Sara, who is part of a pending class action suit against AOL-Time Warner, charging that the company artificially inflated stock prices. When the stock price dropped, she said, she lost some $50,000 and $100,000

“I’m not happy with what happened,” she said. “But these are two separate cases.”

Marilyn also made the pool. Marilyn’s job is to help relocate various executives, including those from Tyco International, another company beset by scandal that was once based on the Seacoast. She even knew Dennis Kozlowski, the former Tyco CEO who was sentenced to 25 years in prison for looting the company.

“He was a very good person to work for,” Marilyn said. “Money changed him, but some of the details in his trial were out of whack. It was all very sad and very wrong.”

Marilyn even located some Cabletron executives when the company first started. Asked whether all this would influence her in dealing with Enterasys defendants, she answered, “I hope not.”

Opening arguments in the trial are scheduled for today. Prosecutors say they will show how former CFO Robert Gagalis hid information from auditors, regulators and shareholders to inflate revenue in the first quarter following the spin-off.

The other defendants are former executives Jerry Shanahan, Bruce Kay, Robert Barber and David Boey. – BOB SANDERS


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