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After seven days of deliberations, jurors in Arthur Andersen’s obstruction of justice trial announced late on Wednesday they were deadlocked, but U.S. District Judge Melinda Harmon of Houston ordered them back into the jury room to keep trying. The Allen charge Harmon read to jurors tells them to “continue your deliberations in an effort to agree upon a verdict and dispose of this case.” At 5:30 p.m. Wednesday, the jury of nine men and three women sent out a note saying, “We are not able to reach a unanimous verdict.” Harmon told Andersen defense lawyers and prosecutors she would give the supplemental charge, but as has been the pattern during the trial, the lawyers fought over the wording. Defense lawyers wanted Harmon to include a sentence that is part of the pattern jury charge for the 5th U.S. Circuit Court of Appeals that reminds the jury that the defendant is presumed not guilty. But Harmon decided against including it. The charge Harmon read to jurors tells them to continue trying to reach a verdict, but not to give up their “conscientious conviction.” The defense wanted Harmon to include the sentence, “You must also remember that if the evidence in the case fails to establish guilt beyond a reasonable doubt, the accused should have your unanimous verdict of not guilty.” Defense lawyer Denis McInerney, a partner in New York’s Davis, Polk & Wardwell, told Harmon the jury “must” be reminded that the defendant is not guilty. But Harmon said she didn’t think it belonged in the charge. Lead defense attorney Russell “Rusty” Hardin Jr. of Houston says he’s never been involved in a trial before where a judge gave an Allen charge. He says he has mixed feelings about the deadlock, even though a hung jury is supposed to be a victory for the defense. Thomas Melsheimer, a trial lawyer in Dallas and a former prosecutor, says defense attorneys generally don’t like an Allen charge because a long deliberation indicates a split jury. Melsheimer, a partner in Fish & Richardson’s Dallas office, says he tried one case as a prosecutor when a jury received an Allen charge and later convicted the defendant. The jury got Andersen’s case late in the evening of June 5, after a long day of closing arguments by Hardin, of Houston’s Rusty Hardin & Associates, and Assistant U.S. Attorneys Samuel Buell and Andrew Weissmann. Andersen is charged with obstruction of justice for allegedly destroying documents related to its work for Enron Corp. at a time when Enron was under investigation by the Securities and Exchange Commission. The indictment alleges Andersen destroyed documents from Oct. 10 to Nov. 9, 2001, in its Houston, Chicago, Portland, Ore., and London offices. Andersen, formerly Enron’s accounting firm, was charged in March with obstruction of justice. While the verdict could be the death knell to Andersen, which already faces massive client defections after the downfall of Enron, the verdict is the first test of the Enron Task Force, which continues to investigate Enron. To find Andersen guilty, jurors must find that at least one “corrupt persuader” at Andersen persuaded others, or attempted to persuade others at Andersen, to destroy documents to keep them from the SEC. Prosecutors implicated four individuals, including David Duncan, the lead auditor on the Enron engagement; in-house lawyer Nancy Temple; Thomas Bauer, another Andersen partner on the Enron account; and Michael Odom, a practice director in Houston. But prosecutor Buell, a special attorney on the Enron Task Force, laid the blame for the destruction squarely on Andersen’s legal department. The defense contends no one at Andersen, including Duncan, intended to obstruct justice when destroying documents and any destruction of documents and e-mails was simply an effort to catch up on routine file maintenance outlined in the firm’s document retention and destruction policy. The prosecution called 19 witnesses; the defense called 15. The key witness of the trial was Duncan, who was on the stand for five days. Duncan pleaded guilty to obstruction in April and agreed to testify for the prosecution. While Duncan testified he pleaded guilty because he came to believe he committed a crime by asking others at Andersen to follow the firm’s document retention and destruction policy, he also testified he didn’t believe last fall that he was doing anything wrong. Hardin attempted to convince the jury that Duncan pleaded guilty only after he met several times with prosecutors and government agents. Temple and Bauer were called by both sides, but both declined to testify and invoked the Fifth Amendment. The note from the jury Wednesday was its first communication with the court since Sunday, when its request for a dictionary was turned down by Harmon. Brenda Sapino Jeffreys is a senior reporter with Texas Lawyer , a division of American Lawyer Media and an affiliate of law.com.

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