Scrushy Will Get Appeal, But Won’t Be Released While Waiting

Atlanta appeals attorneys are following the developments in the case of Richard Scrushy, the HealthSouth Corp. founder who was sent to prison in 2007 for bribery and mail fraud. His appeal on his conviction has yet to be heard. Scrushy is optimisitc that the U.S. Supreme Court’s recent ruling in the Skilling case could be used to reverse his conviction. He had asked to be released on bond pending the federal appeals court review of his case.

The 11th U.S. Circuit Court of Appeals in Atlanta denied the motion for release pending appeal. Scrushy moved for the early release in July, after the U.S. Supreme Court asked the Atlanta court to review its decision upholding his conviction.

Richard Scrushy is currently serving a term of 6 years and 10 months for bribery. He was convicted in 2006 of giving Alabama Governor Don Siegelman a $500,000 campaign contribution in exchange for a seat on a state hospital regulatory board. He was acquitted in 2005 on criminal charges of directing an accounting fraud.

The U.S. Supreme Court ruled in June on the case of former Enron CEO Jeffrey Skilling. In that case, the Supreme Court narrowed the scope of the “honest services” law. They ruled it could be applied only in cases involving bribery or kickbacks. Scrushy and Siegelman were convicted of bribery and honest services fraud. The Supreme Court has asked the 11th Circuit to review a ruling upholding their convictions in light of the Skilling decision.

The name of the case is U.S. v. Siegelman, 07-13163-B, 11th U.S. Circuit Court of Appeals (Atlanta). The lower-court case is U.S. v. Scrushy, 05-cr-119, U.S. District Court, Middle District of Alabama (Montgomery).

Source: Bloomberg, “HealthSouth’s Scrushy Loses His Bid for Early Release Pending Court Review,” Sept. 1, 2010