New Andersen lawyer used to tough odds
Mahoney a winner in Michigan case
South Bend native Maureen Mahoney graduated from the University of Chicago Law School. The veteran trial lawyer will defend the Andersen accounting firm before a federal appeals court. (Photo for the Tribune by Susana Raab)
It is expected to be a difficult case, especially since the accounting firm is fighting for little more than its once-stellar reputation.
Still, the veteran Washington trial lawyer is coming off one of the most significant U.S. Supreme Court cases in a generation--a case few thought she would win.
In June she represented the University of Michigan Law School in defense of its affirmative-action program for admissions. She faced long odds, considering the conservative makeup of the court and its past decisions striking down aspects of affirmative action.
"This is the only case I've ever handled where I got fan mail," said Mahoney, 48. "I also think I ended up with nine bouquets of flowers."
Few lawyers get a chance to appear before the high court. But Mahoney, a former Supreme Court law clerk, has argued 12 cases and been on the winning side 11 times. Chief Justice William Rehnquist broke with formality in a recent hearing by addressing Mahoney by her first name.
Now the northern Indiana native, who graduated from the University of Chicago Law School, is getting up to speed on the Andersen case. The firm declines to say how much she is being paid.
In June 2002, a federal jury found the firm guilty of obstruction of justice for blocking an investigation by securities regulators into the financial debacle at Enron Corp. Soon after, the 89-year-old firm ceased auditing public companies. It since has shrunk to 250 employees from its peak of 85,000 worldwide.
Andersen appealed the conviction, and oral arguments are likely to be held the week of Oct. 6 before the 5th U.S. Circuit Court of Appeals.
Even if the conviction is overturned, the accounting firm will not be resurrected. And Andersen still faces a number of shareholder suits related to Enron's collapse, seeking hundreds of millions of dollars. But an appellate victory could bolster its defense in those cases.
"It's appropriate in this situation to have top-notch talent," said Andersen spokesman Patrick Dorton.
Trial errors alleged
In its 85-page brief, Andersen argues that the trial judge made several errors, including not allowing the defense to provide evidence that the firm's Enron engagement team "preserved multiple copies of the very documents whose deletion the prosecution emphasized."
The judge also, according to the brief, allowed the prosecution to present evidence about accounting scandals at two former Andersen clients, Waste Management Inc. and Sunbeam Corp. The firm argues that this evidence was irrelevant and prejudicial. It also raises questions about jury instructions.
"The proper interpretation of obstruction of justice is certainly of great importance to corporate America," Mahoney said. "Every corporation in American has a document-retention policy."
Her courtroom accomplishments do not surprise people familiar with her. Law professors recall a "can't miss" legal scholar who was as tough as nails.
"She was blessed with an extraordinary linear mind; nothing would divert her from whatever position she was after," said Richard Epstein, a professor at the University of Chicago Law School, who taught Mahoney in her first year.
She was a determined little girl too. Mahoney, a native of South Bend, Ind., fondly recalls announcing at the dinner table when she was 8 that she wanted to be a lawyer just like her father, a personal-injury attorney.
"My father told me in a very kind tone that there was no place for women in the law," she said. He wasn't being sexist, she said, but rather simply recounting his workplace experiences.