US appeals court grants bail to ex-media mogul Conrad Black pending appeal of fraud conviction

Court grants bail to jailed ex-media mogul Black

CHICAGO — Conrad Black, the brash former newspaper magnate who lived extravagantly before his 2007 federal conviction for defrauding shareholders, may soon be released from a Florida prison after a federal appeals court granted him bail Monday.

The ruling from the 7th Circuit U.S. Court of Appeals came weeks after the U.S. Supreme Court kicked Black’s fraud conviction back to a lower court.

Black, who renounced his Canadian citizenship to become a member of the British House of Lords, was convicted along with three other former executives from the media empire Hollinger International of swindling the company’s shareholders out of $6.1 million. He was acquitted of nine other charges.

It was not immediately clear when Black, 65, would be released from the low-security prison in Coleman, Fla., where he has served more than two years of a 6 1/2-year sentence. The conditions of his release will be determined by U.S. District Court judge in Chicago, according to an order from the three-judge panel.

Last month, the Supreme Court weakened the “honest services” law that was central to Black’s fraud conviction. The justices left it up to a lower court to decide whether the conviction should be overturned. That decision has not yet been made.

Black also was convicted of obstruction of justice after jurors saw a video of him carrying boxes of documents out of his offices, loading them into his car and driving off with them. The documents were sought by government investigators.

A call to Black’s attorney, Miguel Estrada, was not immediately returned. A federal Bureau of Prisons spokeswoman said Black, 65, remained in prison on Monday and it was unclear when he might be released.

Before the Supreme Court ruling, prosecutors had said Black should remain in prison because the high court’s decision wouldn’t affect the obstruction of justice count. A spokesman for the U.S. attorney’s office in Chicago said officials wouldn’t comment.

Hollinger International once owned the Chicago Sun-Times, The Daily Telegraph of London, The Jerusalem Post and hundreds of community papers in the U.S. and Canada.

The “honest services” law has been criticized by defense lawyers as the last resort of prosecutors in corruption cases that lack the evidence to prove that money is changing hands. It also has been called vague, subjecting people to prosecution for mistakes and minor transgressions in the business and political worlds. But watchdogs consider it key to fighting white-collar and public fraud.

The Justice Department said at the time of the Supreme Court ruling that prosecutors would continue to urge that honest services convictions for Black and others be upheld.

The court’s decision made headlines all over the world, in large part because of the names of those sitting in prison as a result of the law, including Black, former Enron boss Jeffrey Skilling, disgraced lobbyist Jack Abramoff and California Congressman Randy “Duke” Cunningham.

Black — who received the title of Lord Black of Crossharbour — was known for a grand lifestyle, including a $62,000 birthday party for his wife, a swanky apartment on Park Avenue in New York and a trip to the island of Bora Bora.

Black’s three-month trial drew international media attention, heightened by his sometimes haughty comments. When shareholders grumbled about the cost of the Bora Bora trip, he wrote a memo saying: “I’m not prepared to re-enact the French revolutionary renunciation of the rights of the nobility.”

At the core of the charges against Black was his strategy, starting in 1998, of selling off the bulk of the small community papers, which were published in smaller cities across the United States and Canada.

Black and other Hollinger executives received millions of dollars in payments from the companies that bought the community papers in return for promises that they would not return to compete with the new owners.

Prosecutors said the executives pocketed the money, which they said belonged to shareholders, without telling Hollinger’s board of directors.

But Black’s lawyers have maintained that federal prosecutors failed to muster adequate evidence that he defrauded anyone or tried to hide key documents.