Chamber backs Nacchio's high-court petition
By Andy Vuong
Monday, April 27, 2009
Former Qwest chief executive Joe Nacchio has a new ally: the
U.S. Chamber of Commerce.
The chamber has asked the Supreme Court to grant Nacchio's
petition for a review of his criminal insider trading
"This case presents an issue of great importance to the hundreds
of thousands of businesses that are subject to the federal
securities laws," the chamber states in a court filing.
Nacchio, 59, began serving a six-year term this month at a
federal prison camp in
Pennsylvania. He was convicted on
19 counts of insider trading, accused of selling $52 million in
Qwest stock in early 2001 based on private warnings that the
company's financial condition was deteriorating.
The full 10th Circuit Court of Appeals upheld the conviction in
Nacchio has contended that the warnings he received in late 2000
and early 2001 about Qwest's future revenue were not material,
or significant enough to warrant public disclosure.
The chamber, which says it represents more than 3 million
companies and professional organizations, argues that ruling
that the warnings were material "is fundamentally misguided and
portends serious consequences for American business interests."
"Indeed, if left undisturbed, the Tenth Circuit's rule may have
the perverse effect of discouraging rather than promoting the
full and prompt flow of accurate information to the
marketplace," the chamber states in its brief, filed last week.
"If the consequence of reporting doubts about future financial
targets is a categorical ban on stock sales, employees will
think twice before collecting, reporting, or inquiring about
such information," the filing states.
The chamber said that it regularly gets involved in cases that
may affect the business community.
The National Association of Criminal Defense Lawyers and the
Washington Legal Foundation have also filed briefs in support of
The U.S. Department of Justice has until May 22 to respond.
Andy Vuong: 303-954-1209 or