U.S. Drops Scrushy Appeal

From Associated Press

The government dropped efforts Wednesday to retry Richard Scrushy, saying it would not appeal a judge’s decision to dismiss perjury charges against the fired HealthSouth Corp. chief executive, acquitted of directing a $2.7-billion fraud.

Immediately after Scrushy’s trial last month, federal prosecutors said they would ask an appeals court to reinstate counts accusing Scrushy of lying to the Securities and Exchange Commission about an earnings overstatement. A judge threw out the three perjury counts during the case.

U.S. Atty. Alice Martin said Wednesday that the government had decided against pursuing an appeal. The decision means Scrushy will not have a second criminal trial, she said.


“There were just a lot of legal considerations that went into it,” Martin said.

Among other things, prosecutors had to consider whether it was possible to again accuse Scrushy of lying about the fraud considering his acquittal in the scheme. A retrial also could have raised the issue of double jeopardy, or trying Scrushy twice for the same crime.

Although U.S. District Judge Karon Bowdre also dismissed charges accusing Scrushy of obstruction of justice, Martin said the government was barred from appealing that decision because it came at the end of the prosecution’s case.

An aide said Scrushy was “thrilled” by the government’s decision.

“This is the end of Richard Scrushy’s criminal issue once and for all,” Scrushy spokesman Charlie Russell said. “We are free to turn our attention to resolving the civil issues.”

Scrushy is still named in dozens of civil lawsuits over the HealthSouth fraud, including one filed by the SEC accusing him of leading the accounting scheme. Martin said the decision to skip the appeal wasn’t connected to the SEC’s suit.

Fifteen former HealthSouth executives pleaded guilty in the fraud, including five finance chiefs who implicated Scrushy in the conspiracy. Jurors rejected that testimony and sided with the defense, which argued that Scrushy was duped by corrupt subordinates.