Headed to Jail
Nacchio Set to Start Serving Six-Year Sentence After Long Legal Battle
By Dionne Searcey
The Wall Street Journal
Tuesday, April 14, 2009
Joseph Nacchio, the former chief executive of Qwest
Communications International, Inc., is expected to head to
federal prison Tuesday, nearly two years after a judge sentenced
him to serve six years for insider trading.
Mr. Nacchio, 59 years old, is slated to arrive at the Schuylkill
minimum security camp in
Pa., at noon Tuesday. A
federal appellate panel denied a motion for bail Monday
afternoon. His attorneys asked U.S. Supreme Court Justice
Stephen Breyer, who oversees the 10th Circuit Court of Appeals
for bail but as of late Monday the request had gone unanswered.
Mr. Nacchio's lawyer, Maureen Mahoney, declined to comment.
Mr. Nacchio was convicted in 2007 of 19 counts of insider
trading for selling $52 million in Qwest stock while knowing the
company's finances were faltering. His legal journey since
then has been a roller coaster of rulings with a federal panel
tossing out his conviction, only to have that decision later
overruled, and then several deadlines to report to prison
extended at the last minute after he filed appeals.
The legal twists have been closely followed by a group of former
employees who lost their savings under Mr. Nacchio's leadership
and desire to see him behind bars.
"Our people have been so up and down...there have been so many
put-offs and stays to the point of ridiculousness," said Nelson
Phelps, the executive director of a group representing Qwest
retirees. "It really has soured and angered so many of our
The start of Mr. Nacchio's prison sentence doesn't mark the end
of his legal battles, however. Ms. Mahoney has appealed
his conviction to the U.S. Supreme Court and said in a court
filing she expects others including the U.S. Chamber of
Commerce, to file briefs in support.
An attorney for the Chamber said the brief would ask the court
to clarify the internal information that can make CEOs guilty of
insider trading. Mr. Nacchio's attorneys also have asked
for a new trial after a witness against him recently offered
sworn statements that seemed to conflict with testimony at his
Mr. Nacchio, whose legal bills have been paid at least in part
by Qwest, also faces a civil suit from the Securities and
Exchange Commission, which was on hold while other legal issues
tied to his criminal case were clarified. The SEC is
seeking to bar him from serving as a director or officer of
another public company as well as seeking to obtain various
ill-gotten gains and penalties.
Mr. Nacchio requested to spend his six years in Schuylkill
because of its proximity to his wife, who has a home in
New Jersey. According to a prison
spokesman, Mr. Nacchio, inmate number 33973-013, will join 287
others and be offered meals that are "heart-healthy alternatives
to processed or fried foods" as well as a dormitory-style
cubicle he will share with another prisoner. He will be
assigned a job and receive pay of up to 40 cents an hour. The
facility has an outdoor walking track and indoor gymnasium.
Write to Dionne Searcey at