AUSWR
The Association of U S West Retirees
 

 

 

If Nacchio's worried, he won't show it
By Al Lewis, Staff Columnist
Denver Post
Wednesday, December 21, 2005

It's an image nobody captured on camera:  Former Qwest CEO Joe Nacchio was led into a federal courtroom Tuesday wearing handcuffs.

He had spent most of the day in federal custody, just across the street from the Qwest tower, where he once had an expansive view of the Rocky Mountains from the 52nd floor.

The handcuffs, and a missing belt and tie, were the only signs of Nacchio's brief detention.

His pressed white shirt and dark navy slacks did not succumb to wrinkles in the holding tank.  And, as he scanned faces in the gallery, his bright, inquisitive eyes did not appear to reveal contrition or despair.

After a federal officer removed his cuffs, Nacchio sat quietly beside his two lawyers and calmly folded his hands on the table.  He cracked a smile or two after surrendering his passport and signing documents to be released on a $2 million personal-recognizance bond.

Then, it was back to the handcuffs and out the prisoner door to be processed for release.

Nacchio did not look comfortable.  But all things considered, he did not look perturbed, either.  If anything, he looked like a man who was certain of his innocence and that the handcuffs would not be on for very long.

After the hearing, Nacchio's attorney Herbert Stern promised reporters his client would be exonerated.

Read the 42-count indictment, and you will see why this case is so thin, said Stern, a friendly man who was renowned in the 1970s for battling New Jersey government corruption as a prosecutor and judge.

The indictment can be viewed as either stingy on details or elegant in its simplicity.  Each of the 42 counts lists a stock sale Nacchio made between January and May 2001 and fits on a single line across the page.  There are also about five pages that allege Nacchio was aware of Qwest's downward trajectory at the time of these trades.

After Nacchio got his tie and belt back, his demeanor changed from calm and reserved to jovial.

"I look forward to us getting on with this," he told reporters outside the court building after his release.

After more than three years since he departed from Qwest, he said he finally knows the exact charges he is facing.

In June, attorneys representing Nacchio against a Securities and Exchange Commission civil action argued that he was guilty only of being optimistic about his company, or maybe even engaging in a little "puffery."

Nacchio was famous for puffery, particularly when it came to questions about his performance and pay.

"I should be allowed to make more than a second baseman," Nacchio famously told reporters at Qwest's annual meeting of shareholders in 2001.  "I create more economic value than they do."

I don't know where that economic value is today.

But even after Qwest had to restate $2.5 billion in revenues, put up $400 million to settle shareholder suits and pay $250 million to settle charges from the SEC, Nacchio apparently hasn't learned his lesson about puffery.

Denver Post reporter Tom McGhee approached Nacchio at Denver International Airport on Monday evening to ask him what he was doing in Denver.

"I'm going to be skiing," said Nacchio.

And why did he take a commercial flight?  (Hmm.  Was it perhaps because the FBI and federal prosecutors considered him a flight risk on a private jet?)

"I always flew commercial," Nacchio told McGhee.

Well, not always.

Nacchio's employment contract at Qwest gave him virtually unfettered use of the company jets.  Qwest even paid for air travel for his family between New Jersey, where Nacchio kept his home, and Denver, where he worked.

I suppose that Nacchio "always flew commercial" when he wasn't flying on private aircraft.  And perhaps, when Nacchio spoke with McGhee, he fully intended to hit the slopes.

But then that FBI arrest kind of got in his way.  And it's hard to ski with handcuffs.

Al Lewis' column regularly appears on Sundays, Tuesdays and Fridays. Respond to Al at denverpostbloghouse.com/lewis, 303-820-1967 or alewis@denverpost.com.


http://www.denverpost.com/business/ci_3328287