Under the Fifth Circuit's law of abatement of a criminal conviction when a defendant dies before appellate review of the conviction, "It is well established in this circuit that the death of a criminal defendant pending an appeal of his or her case abates, ab initio, the entire criminal proceeding." United States v. Asset, 990 F.2d 208 (5th Cir. 1993). In a recent Fifth Circuit decision, United States v. Estate of Parsons, 367 F.3d 409 (5th Cir. 2004), 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." In Parsons, the court vacated a forfeiture order, which means that the government's forfeiture claim against Lay for $43.5 million (see earlier post here) will be dismissed. 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." An interesting question is whether one can still describe Lay as having been convicted of a crime, at least in a technical sense, because the law no longer recognizes there having been any criminal case initiated against him.
Unlike the criminal case, civil claims against Lay, such as the SEC's case and the securities class action, will continue against his estate. However, because the criminal conviction is wiped out, the plaintiffs cannot rely on it as proof in their case, if my dim memory of collateral estoppel serves me right. [emphasis mine]
Of course Lay knew all of this in advance. He had the most expensive legal talent stolen money could buy.
Another compelling argument for his suicide is the date: the fourth of July (the ambulance was called at 1 a.m. on the 5th), America's birthday. Suicide notes are generally addressed to those perceived to have hurt the suicidee. In this case, Lay has said that since the collapse of his company he was living the "American nightmare," and so wanted to take out his revenge against who he thought hurt him the most — America itself.
With his suicide &mdash designed to clear his name, enrich his family, and shame the country all in one fell swoop — Lay proved he was an egomaniac until the very end. But there are still many people among those he hurt who think even his death is doubtful.
More on the postmortem clearing of Lay's name at the Houston Chronicle, which conveniently reminds us of another Enron suicide and its possible rationale: "When former Enron executive Cliff Baxter killed himself in early 2002, attorneys representing the shareholders decided to drop his estate from the case."
