Ex-media mogul accused of defrauding investors could leave prison Wed., judge to set terms

By Karen Hawkins, AP
Wednesday, July 21, 2010

Ex-media mogul Conrad Black may leave prison Wed.

CHICAGO — Former media mogul Conrad Black could stroll out of federal prison Wednesday just two years into the 6½-year sentence he received for defrauding investors out of millions of dollars, but whether he’ll be a free man isn’t yet clear.

U.S. District Judge Amy St. Eve will set the conditions of Black’s release during a hearing in Chicago early Wednesday, which is the earliest the former head of the Hollinger International media empire could leave a prison in Florida.

The 7th Circuit U.S. Court of Appeals on Monday granted Black’s motion for bail as he appeals his 2007 conviction for fraud and obstruction of justice. The decision came just weeks after the U.S. Supreme Court weakened the “honest services” law that was central to Black’s conviction.

The appeals court will eventually decide whether to overturn Black’s conviction in whole or in part, leaving prosecutors to determine whether to retry him. If they don’t, Black would remain free. But the appeals court could toss the fraud charge and keep the obstruction of justice count, and order St. Eve to hold a new sentencing hearing.

Prosecutors said Tuesday that Black was unlikely to attend the Wednesday hearing, but they otherwise declined to comment on the case. Black’s attorney, Miguel Estrada, did not respond to phone messages seeking comment.

Two legal experts not involved with Black’s case but who have been watching it closely say the government could have a tough time putting the 65-year-old back behind bars once he’s freed from the minimum security prison in Coleman, Fla., where he has been serving his sentence.

“It would be hard to put this case back together again,” said Steven Skurka, an attorney who wrote a book about Black’s trial. “You have someone who served two years. It’s hard to refocus three years later. If the court ordered a new trial, Black would never see a courtroom again.”

The appellate court’s decision to release Black pending his appeal bodes well for him, said Marc Rothenberg, a former federal prosecutor who’s now a white collar criminal defense attorney.

“In most criminal cases, courts don’t grant bail pending appeal unless there’s a likelihood that the conviction will be overturned on all the counts,” Rothenberg said. “By the 7th Circuit ordering that Mr. Black be given bail and directing the district court to set those conditions … they really have shown a sea change in their confidence in the jury’s verdict.”

The same appeals court rejected Black’s appeal two years ago. Rothenberg said if the convictions are overturned, it’s unlikely prosecutors will spend the time and energy to retry him.

Black and three former Hollinger International executives were convicted in 2007 of defrauding shareholders out of $6.1 million. One of the prosecutors’ arguments was that Black deprived the company of his faithful services as a corporate officer, breaking the so-called “honest services” law.

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. The high court’s ruling didn’t affect the obstruction of justice count.

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.

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