The Supreme Court Confronts The Ghosts of Enron: Assessing The Past, Present and Future of Corporate Fraud Enforcement

The U.S. Supreme Court ended its 2010 term with a significant ruling on the appeal of former Enron CEO Jeffrey Skilling that sharply curtailed application of the “honest services” doctrine, which had figured prominently in Skilling’s conviction. The Court held that the conceptual breadth of the term “honest services” and the apparent inconsistency of rulings applying the doctrine rendered it unconstitutionally vague unless confined to cases of bribery or kickbacks. Notably, Enron and other corporate fraud cases did not involve either form of corruption. This article reviews the development of the honest services doctrine, discusses and analyzes the Skilling decision, and argues that future corporate fraud enforcement is likely to be hindered not only by the specifics of the Skilling decision but also by its underlying ethical philosophy