Securities and Exchange Commission v. Koenig

Brief Fact Summary.

A jury found that accounting practices devised by Koenig, as the chief financial officer of Waste Management, Inc., were fraudulent. During the trial, the district judge allowed jurors to submit questions to him. Some of the questions were asked, some were reformulated and asked, and others were not asked because they were either not appropriate or redundant in the judge’s opinion.  Koenig argued that it was reversible error to allow the jurors to submit questions to the judge.

Synopsis of Rule of Law.

Whether to allow jurors to pose questions is an issue within the sound discretion of the trial judge.

Facts.

Koenig was the chief financial officer of Waste Management, Inc. Koenig devised certain accounting strategies to improve financial appearances when Waste Management’s business growth slowed in the early to mid-1990s. A jury found that these accounting strategies were fraudulent. The district judge imposed a civil penalty on Koenig of over $2 million and ordered him to disgorge certain bonuses he had received, plus interest, also totaling approximately $2 million. During the trial, the district judge allowed jurors to submit questions to him. Some of the questions were asked, some were reformulated and asked, and others were not asked because they were either not appropriate or redundant in the judge’s opinion.  Koenig argued that it was reversible error to allow the jurors to submit questions to the judge.

Issue.

Was it reversible error for the district court judge to allow jurors to submit questions to him?

Held.

No. It was not reversible error for the district court judge to allow jurors to submit questions to him.

Discussion.

The trial judge did not abuse his discretion in this case in allowing the jury to submit questions. The  decision to allow the jury to submit questions, and the trial judge’s oversight and supervision of the questioning process, was sensible and properly considered.