NEW YORK (AP) — Frank Quattrone, the investment banker whose Internet-boom success brought him huge wealth and star status in his industry, returns to court today for a second trial on obstruction of justice charges.
His first trial ended in a mistrial last October, with jurors deadlocked — but a majority leaning toward conviction — on charges that Mr. Quattrone tried to hinder a 2000 federal investigation into stock allocation by his bank.
Federal prosecutors in Manhattan enter the retrial fresh off a victory in their highest-profile white-collar case — a conviction of Martha Stewart in March on charges of obstruction, conspiracy and lying to investigators.
In the Quattrone case, they must show the banker acted with criminal intent on Dec. 5, 2000, when he endorsed a colleague’s e-mail that urged employees to “catch up on file cleaning” by destroying some files.
Mr. Quattrone contends he was simply following the policy of his bank, Credit Suisse First Boston, which required routine destruction of some outdated documents.
The 48-year-old former banker is charged with obstruction of justice, obstructing the Securities and Exchange Commission and witness tampering.
Among the key questions for the retrial: Will Mr. Quattrone take the stand again in his own defense?
Some jurors said after the first trial that Mr. Quattrone hurt his own case by appearing combative on the stand and appearing to contradict his lawyer’s assertion that he had no involvement in how CSFB doled out stock shares.
Mr. Quattrone testified that while he had some involvement in stock-allocation discussions, he never made any final decisions on who received shares.
In 2000, the government was looking into how CSFB doled out shares of hot new stocks it was taking to market. The probe closed with no criminal charges filed, and the bank later paid $100 million to settle related civil charges.
Legal experts said they did not expect Quattrone lawyer John W. Keker to change his trial strategy simply because of what some jurors said about Mr. Quattrone’s testimony.
“Although you want to know what the jurors were thinking in their deliberations, you take it with a grain of salt because every jury is different,” said Michael Proctor, a California defense lawyer with extensive white-collar experience.
Should Mr. Quattrone take the stand again, his own lawyers will likely draw out the nuances of his role in the stock-allocation process, to try to avoid surprises on cross-examination, analysts said.
“It’s probably an advantage for the defense,” said Greg Markel, litigation chairman at the New York law firm Cadwalder, Wickersham & Taft.
Quattrone spokesman Bob Chlopak declined to comment yesterday on whether Mr. Quattrone would testify.
Judge Richard Owen, who oversaw the four-week first trial, will preside over the second as well — despite pleas from defense lawyers that he remove himself for having shown what they called pro-government bias.
Judge Owen has denied Mr. Quattrone’s request to move the trial to California, closer to his home. And last week the judge denied a defense request to keep the jury anonymous.
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