Kansas City, Mo. ? The second federal fraud trial of two former Westar Energy Inc. executives is expected to be longer and more widely watched than the first one.

Jury selection was scheduled to begin Tuesday in Kansas City, Kan., in the retrial of former chairman and chief executive David Wittig and former chief strategy officer Douglas Lake on charges that the two men tried to loot the Topeka-based utility.

Corporate lawyers outside Kansas are watching whether an appeals court overturns U.S. District Judge Julie Robinson’s recent decision to freeze payments Westar was making to the legal teams for Wittig and Lake.

Under the men’s employment agreements, the utility was obligated to pay their legal fees. Such arrangements, called “indemnification,” aren’t uncommon in corporate executive employment contracts.

So far, Westar, the state’s largest electric utility, has paid $8.3 million to the New York-based defense teams of Wittig and Lake.

Robinson three weeks ago approved a prosecution motion to freeze future defense fees, saying Assistant U.S. Attorney Richard Hathaway provided enough evidence in the first trial to show probable cause that the payments were part of the defendants’ plan to loot the utility.

Lake, whose assets were frozen by the court last year, has asked the 10th U.S. Circuit Court of Appeals to overturn Robinson’s decision, saying he can’t afford to keep his attorneys without the fees from Westar.

Robinson last week refused Lake’s emergency motion to postpone the trial until the appeals court makes a decision. Prosecutors have scoffed at the defendants’ complaints, noting the U.S. Attorney’s Office for Kansas has an annual budget of $7.2 million.

Attorneys outside Kansas say a federal decision invalidating corporate indemnification could set an important precedent.

“It basically says the government has the right in regards to the forfeiture to prevent the defense from getting legal fees which ordinarily would flow to them,” said New York attorney Robert Morvillo. “I’ve never seen that happen before.”

Many states, including Kansas, require corporations to indemnify their executives, he said.

Wittig and Lake each face 40 counts ranging from wire fraud to money laundering. They have pleaded innocent.