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CNN Live At Daybreak

Lay Takes Fifth; Interview of Thomas Moore

Aired February 13, 2002 - 06:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL COSTELLO, CNN ANCHOR: Former Enron Chairman Kenneth Lay may have taken the Fifth Amendment rather than speak to a Senate panel, but as CNN's Jonathan Karl reports, that didn't stop angry lawmakers from speaking to Lay.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Do you swear that you - that the testimony that you give to this committee will be the truth, the whole truth, and nothing but the truth so help you God.

KENNETH LAY, FORMER ENRON CHAIRMAN: I do.

JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT: As predicted, Ken Lay took the Fifth, but he said his silence doesn't mean he has anything to hide.

LAY: Mr. Chairman I come here today with a profound sadness about what has happened to Enron, its current and former employees, retirees, shareholders, and other stake holders. I have also wanted to respond to the best of my knowledge and recollection to the questions you and your colleagues have about the collapse of Enron. I have, however, been instructed by my counsel not to testify based on my Fifth Amendment constitutional rights.

KARL: But before leaving the hearing, Mr. Lay had to sit quietly while senators publicly berated him.

SEN. BARBARA BOXER, (D), CALIFORNIA: Mr. Lay, I know you're not going to talk to the committee. You have a right not to. But I have a chance to talk to you, so that's what I'm going to do, talk to you.

SEN. PETER FITZGERALD (R), ILLINOIS: I'd say you were a carnival barker, except that wouldn't be fair to carnival barkers. A carnie will at least tell you up front that he's running a shell game.

KARL: Mr. Lay sat stoned faced, his hands on his knees, making eye contact with each speaker as the committee took him to task.

(on camera): Mr. Lay will have to go through the process all over again on Thursday when he is under subpoena to appear before a committee on the House side of the capital. And although Mr. Lay is expected to remain silent, another committee will hear from a different key Enron figure, whistle-blower Sherron Watkins. Jonathan Karl, CNN, Capitol Hill.

(END VIDEOTAPE)

COSTELLO: And that should be interesting. So what's behind a congressional witness invoking his Fifth Amendment right not to testify? Often it can have nothing to do with guilt, believe it or not. Litigation expert Thomas Moore, a partner in the Proskauer Rose law firm joins us to talk about taking the Fifth - welcome.

THOMAS MOORE, PARTNER, PROSKAUER ROSE LLP, LITIGATION EXPERT: Good morning.

COSTELLO: So what's the strategy behind taking the Fifth?

MOORE: Well first of all you want fairness. You want an opportunity to do the research that enables you to give a complete and accurate answer. We're still in the early stages of this and if I were a lawyer representing Mr. Lay or another witness before Congress, I would want to have a chance to learn as much as I could before I walked into that kind of hostile environment.

COSTELLO: But isn't there some concern that your client may look more guilty in taking the Fifth and before you answer that, I know Kenneth Lay had some of those concerns. Listen to what he said before the Senate Committee.

LAY: I am deeply troubled about asserting these rights because it may be perceived by some that I have something to hide. But after agonizing consideration, I can not disregard my council's instruction. Therefore, I must respectively decline to answer on Fifth Amendment grounds all the questions of this committee and subcommittee and of those of any other congressional committee and subcommittee.

COSTELLO: Might it make clients look more guilty when they plead the Fifth?

MOORE: Certainly it might. In fact, in civil cases, if a client takes the Fifth Amendment, a civil jury will be instructed that they can then reach a presumption in the civil case that that person had something to hide. And there's no question that that might be the appearance and I suppose that's why Mr. Skilling last week took the chance and decided to testify.

COSTELLO: Of course it's a whole another story criminal court, right?

MOORE: Absolutely. In criminal court, if you invoke the Fifth Amendment, the jury will never know that. They can't put you up in front of the jury and let them reach that inference and in fact, usually Congress doesn't make people do this nowadays. A lawyer will write a letter saying we're going to invoke the Fifth and they don't make you come in appear under the glare of the lights and take the kind of hit that he took yesterday.

COSTELLO: And of course everybody probably knows the answer to this question, but why do you suppose that members of Congress forced Mr. Lay to appear before Congress?

MOORE: Well I suppose because the cameras were there.

COSTELLO: Was it a good idea for Mr. Lay to bring up the fact that pleading the Fifth might make him look guilty?

MOORE: I thought it was a very elegantly drafted statement. I think it must have taken a lot of work by the lawyers to do what they did. They realized just what you said, Carol, that there would be presumption, and they tried to take it head on. It may not have worked, but it certainly was a good shot.

COSTELLO: In your opinion, should Mr. Skilling have done the same?

MOORE: If I were his lawyer representing him as a lawyer and advising him on a sound legal strategy, I would have advised him not to do it. Then the client has to make the decision about whether to follow that advice based on a number of factors. He apparently was most concerned about his reputation and he thought he was tough enough to take that committee on. I'd love to know what he thinks in retrospect.

COSTELLO: Me too, but he's not talking anymore.

MOORE: No.

COSTELLO: Some defense attorneys had said the senators were misguided in forcing Lay and other people connected to Enron to appear before Congress. Why were they misguided, do you think?

MOORE: Well I think in America we have an aversion to bullies, and the presumption that I had in watching this was that this person was being bullied. It was a very harsh and unfair, in my view, personal view, use of the power of Congress to do that.

COSTELLO: All right, Thomas Moore, thank you for joining us this morning from Proskauer Rose law firm. We appreciate you getting up early with us this morning.

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