Archive for Thursday, August 23, 2007

Judge: Lake doesn’t have to post bond

August 23, 2007


— A federal judge ruled Wednesday that former Westar Energy Inc. official Douglas Lake doesn't have to post a $4.2 million bond the company had requested after it was ordered to pay some legal bills Lake incurred while on trial for looting the utility.

U.S. District Judge Julie Robinson again said Westar must pay more than $3 million in delinquent legal bills, and that her June order on that issue can't be appealed until the litigation is completed.

"The judge said no bond is necessary and the judge also has indicated that her order on paying legal fees isn't appealable," said Lake's attorney, Ed Little. "We have contacted the company's lawyers to see if the company will obey the order, but we haven't heard back from them."

Westar spokeswoman Gina Penzig said, "The attorneys are reviewing the judge's order and evaluating our options."

Little said the order is "a very good thing for our client because the company at least is being required to honor its obligation."

The judge declared no bond was required, noting that the amount requested "would in effect nullify Lake's right to advancement of fees and expenses."

Lake, of New Canaan, Conn., Westar's former chief strategic officer, and David Wittig, of Topeka, Westar's former chief executive officer, are scheduled to go to trial in January on charges that include conspiracy and circumvention of internal controls. Under agreements the two men signed while working for Westar, the utility promised to pay any litigation costs tied to their work.

Robinson's ruling came after Lake asked last month that the utility be held in contempt of court for not paying his legal fees.

The company responded by saying Lake should be required to post a $4.2 million bond to cover losses Westar may face if he is convicted and unable to repay the legal fees. It also said it plans to appeal Robinson's order to pay the fees.

But Robinson didn't give Lake's attorneys the full $6 million they had requested, saying some fees may eventually be found excessive. She said the two sides can resolve the difference after Lake's guilt or innocence is determined, which could take years.

In the meantime, Robinson ordered the company to pay Lake's legal bills going forward as he prepares for his third trial.

Wittig and Lake, forced out of Westar in late 2002, originally were charged with wire fraud, money laundering, conspiracy and circumvention of internal controls.

Their first trial ended in a mistrial in December 2004. They were convicted of most charges in September 2005, but an appeals court threw out those convictions and said the most serious charges of wire fraud and money laundering couldn't be retried.

The company has paid $4.7 million of the roughly $12 million in fees Lake's attorneys say they have incurred.

Westar officials stopped paying Lake's legal bills shortly after the first trial, claiming the hourly rates charged by his New York-based attorney were excessive and that he had too many lawyers working on the case.


Ragingbear 10 years, 9 months ago

In other news: My 560 sq. foot apartment just got a $92 electric bill. $54 of it attributed to the "fuel cost" for the vehicle to come read my meter.

formerfarmer 10 years, 9 months ago

Does that mean if Lake robs my apartment, I have to pay his legal fees?

terrapin2 10 years, 9 months ago

FF-Yes you would have to pay his legal fees if you had him sign an employment contract indicating that you would pay, like Westar did. Westar has also said, Ragingbear, that rates have not been raised to pay for any of Lake/Wittig's legal fees, so your bill is your problem. Try bumping up the thermostat a few notches. In case you forgot, all 39 counts against them were overturned by an appellate court. They have yet to be proven guilty of anything. Maybe you should be mad at Westar for ever starting this @#$% in the first place!

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