Corporate Governance

US v. Nacchio: The Tenth Judge on the En Banc Panel

By J. Robert Brown

The case was decided by a 5-4 vote.  Nonetheless, there was a tenth judge involved in the decision making process, Judge Nottingham, the trial judge.  There is little doubt that his presence was felt by the dissenting judges in the en banc decision. 

Throughout the trial, Judge Nottingham and Judge Stern (Stern, counsel for Nacchio had once served as a federal district court judge in New Jersey) engaged in a constant tug of war, with the one with the gavel invariably winnning.  In addition, Judge Nottingham had a run of unsavory publicity in the aftermath of the trial, ultimately resigning from the bench. 

All of this seemed to have an impact on the deliberations.  Judge Holmes speaking for the majority disclaimed any impact of the trial judge on the appeal.      

• Mr. Nacchio is attempting to recast an unremarkable district court evidentiary ruling as an invidious act of judicial hubris. But it will not work. At bottom, Mr. Nacchio’s argument is no more than a run-of-the-mill lament of unfair surprise. We have rejected similar claims when, as here, the record belies them. Some of it was overt.

The dissent had a harder time of it.  Some judges didn't go to any great length to hide their annoyance at Judge Nottingham. 

During oral argument, Judge Kelly expressed almost palpable anger at Judge Nottingham, describing his ruling on Fischel as "the most simplistic thing I've ever seen." He seemed to confirm this attitude with a demonstration of favoratism toward counsel for the defense at oral argument.  Moreover, in his dissent in the en banc opinion, he specifically referred to "the tone of this trial," an obvious reference to his attitude towards Judge Nottingham. 

Judge Henry in his dissent in the en banc case also had a few digs to make at Judge Nottingham, although they were at least a bit less personal. As he described:"Yet, the district court, seemingly driven by some internal time schedule, deprived Mr. Nacchio of his key expert witness, Professor Daniel Fischel."  Whatever he means by "timetable," its clear that he viewed the ruling as somehow motivated by something other than Judge Nottingham's view of the law and the adequacy of the defendant's submissions.

Finally, Judge McConnell wrote a 44 page dissent.  Rather than discuss the trial judge in neutral terms (Judge Holmes referred to the decision maker interchangeably as the trial judge or the district court),  Judge McConnell singled out Judge Nottingham by name, mentioning him 33 times, as if the reference to the specific individual would somehow strengthen his argument.  We haven't studied the opinions written by Judge McConnell in any great detail but suspect that it would be unusual for him to criticize a specific judge by name in an opinion to the extent done in his dissent in the Nacchio en banc.  The opinion, therefore, has a very personal feel, one judge chastising another by name.  It doesn't help that Judge McConnel used some occasionally harsh language in describing the rulings of Judge Nottingham ("In his explanation of his disqualification ruling, Judge Nottingham articulated a contempt for expert economic evidence that raises serious questions about any exercise of his discretion in this matter.").   

One does have to wonder whether the presence of a different trial judge would have changed a vote or two among the dissenters.     

The primary materials on this case have been posted at the DU Corporate Governance web site.

Full post as published by The Race to the Bottom on February 26, 2009 (boomark / email).