If you're hoping for a courtroom catharsis to cleanse Wall Street of executive excess, you may be waiting for a while.With Friday's mistrial in the case of execs accused of looting Tyco International ( TYC), investors once again face a maddeningly inconclusive ending to a messy case. As holders of this stock happily shrug off the result -- Tyco rose 43 cents to $29.20, continuing its
We look at pictures of former Tyco CEO Dennis Kozlowski -- a fearsome, carnivorous-looking man -- and we still don't know if he's as villainous as he looks. Maybe he's simply a victim of appearances, or a victim of changing fashion. We all once believed, during the rising stock market, that ostentatious luxury was within our reach; now any executive who was lucky enough to actually enjoy what we craved is perhaps unfairly typecast as rapacious and evil. Other high-profile cases are turning out to be just as unsatisfactory, each for its own reasons. Yes, Martha Stewart lied to investigators, and it looks like she's going to jail. But this former CEO doesn't quite fit the dramatic story line of crime and punishment. Her lies had absolutely nothing to do with the job she did as CEO, but with a few phone calls she made while she was on vacation; the company's shareholders, beset by a plunging stock price, aren't victims of Martha Stewart, but simply innocent bystanders caught in the crossfire. On the other hand, former Dynegy executive Jamie Olis is going to jail for fraud that clearly targeted shareholders of that energy company. Along with other executives, he helped disguise a $300 million loan as cash flow. But the sentence that Olis received last week -- 24 to 30 years in prison -- seems distastefully long, given its context. Co-conspirators of Olis' who pleaded guilty rather than fight the charges they faced, face a maximum of five years apiece, according to Reuters. A formula used to determine Olis' sentence possibly overestimated the blame Olis gets for Dynegy's declining stock price. And it doesn't seem likely that other executives who fiddled with numbers at other companies -- as opposed to, say, emptying out someone else's bank account -- will be serving as long. The harshness of his sentence seems to reflect not the magnitude of his crime, but bad luck and poor negotiation of the judicial system.
Meanwhile, little satisfaction can be had in the trial of John Rigas, two of his sons, and another former executive at Adelphia, the cable TV system operator that Rigas founded and ran for decades. Rigas and sons have already lost control of the business he built from scratch a half century ago. He's had to skip part of his trial for treatment of bladder cancer. The empire he hoped to establish in his hometown of Coudersport, Pa., has dissolved into a business moved off to Denver and expected to be chopped up in the next few years. His family may have skimmed millions from a company worth billions, but what does he have to show for it? Huge legal fees and memories of family Christmas trees delivered via corporate jet, mostly. The hell he'll live out in coming years could hardly be made worse by spending part of that time in jail. Of course, the yearning for a landslide conviction may yet be met. There are plenty of big trials yet to come, including that of WorldCom's Bernie Ebbers, accused of masterminding a fraud that led to the nation's biggest bankruptcy. But it seems the lesson is not to expect too much. Thanks to watching fictional dramas, we hold onto some powerful illusions about what happens in a courtroom. We are led to believe that the guilty are punished appropriately. And we are convinced that a courtroom reveals not only guilt, but truth -- a gratifying understanding of What Really Happened. As the Tyco case and other trials in the news indicate, real life offers few such satisfactions.