A district court judge reportedly dismissed one of three counts accusing former HealthSouth chief executive Richard Scrushy of violating the Sarbanes-Oxley Act, but rejected defense requests to throw out key charges against Scrushy that would have brought an early end to his corporate fraud trial.

The decision on Thursday by U.S. District Judge Karon Bowdre means that the trial of Scrushy, who is accused of directing an accounting fraud that resulted in a $2.7 billion earnings overstatement, will continue. Scrushy is the first CEO accused of violating the corporate reporting law, which was passed in 2002 in response to a wave of corporate accounting scandals.

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