A jury deadlocked last week in the second trial of former Arthur Andersen partner Daniel F. Stulac over the firm's audit of Peregrine Systems.
The jury announced it was deadlocked following the six-week trial, with six jurors voting not guilty on all charges. Stulac faced a maximum of 30 years in prison if convicted. A one-time partner at Arthur Andersen, he was charged in 2004 by the U.S. Attorney's Office in San Diego with securities fraud, wire fraud and bank fraud in connection with the financial reporting of Peregrine. The software company filed for bankruptcy in 2002 after announcing it was conducting an internal investigation of possible misstatements in previous financial reports, which resulted in the resignation of its CEO and CFO.
This is the second trial in the case. Last August, following a three-month trial, a jury deadlocked with eight votes favoring acquittal of Stulac on all counts, resulting in a retrial that began earlier this year.
"Mr. Stulac was charged with conspiring with Peregrine insiders to help cook their books," said Michael Attanasio (pictured), a partner with the law firm Cooley Godward Kronish, which defended him. "This was an unprecedented charge in the post-Enron era." He noted that "The juror perceptions and misperceptions of Andersen made the trial much of an uphill battle." Attanasio presented evidence that at critical moments in the conspiracy, Peregrine executives lied to the Andersen audit team and that Stulac did not profit or benefit from the audit.
He said Cooley Godward Kronish would strongly object if prosecutors attempted to try Stulac a third time. "More than half of the jurors said the evidence was lacking," he said. "It would be unprecedented to have a third trial with those types of results."
