The fight is not over for the disgraced media mogul, write Linda Sandler and Andrew Harris.
Conrad Black, the media mogul freed on bail from a Florida prison this week, may be sent back to jail if he cannot persuade an appeals court that a Supreme Court ruling requires that his fraud and other convictions be set aside.
The former Hollinger International chairman then travelled to Chicago to sign his release papers and hear bail rules spelled out by District Judge Amy St Eve. In 2007 she jailed him for 6½ years. On Wednesday, after more than two years in jail, he posted a $US2 million ($2.2 million) bond with the help of a Wall Street friend. He had no assets available as bond collateral, his lawyer said.
Beyond his criminal appeal, Black has to grapple with the US Internal Revenue Service, which wants almost $US71 million in unpaid taxes and penalties, and the Securities and Exchange Commission, which sued, claiming he and the former Hollinger president David Radler stole $US85 million from the company.
To stay free, Black, 65, must persuade a federal appeals court in Chicago that the Supreme Court ruling, which limited prosecutors' use of a law used to convict him, supports voiding his convictions for fraud and obstruction of justice.
''Black's strategy of sweeping all outstanding government litigation under what is in reality a very limited victory strikes me as fanciful,'' said Jeff Ifrah, a lawyer, and co-author of Federal Sentencing for Business Crimes.
Even if Black did have his convictions reversed, it probably would not help him in his fights with the IRS and the SEC, Mr Ifrah said. Mr Radler settled his liability in the SEC case by agreeing in 2007 to pay $US29 million.
The Supreme Court ruled on June 24 that the so-called honest-services fraud law invoked by prosecutors was intended for cases involving bribery or kickbacks. Black was accused of neither. He has argued that jurors were improperly instructed on the honest-services law as well as money-and-property fraud, and were given the option of convicting him for fraud under either theory, making it impossible to know whether the guilty verdict was valid.
The obstruction charge, which resulted in its own 6½-year jail term, was not dealt with by the Supreme Court. Black's five-year sentence for fraud ran concurrently with the obstruction one.
''There's a strong possibility he goes back to jail,'' said the former assistant US attorney Jeffrey Cramer, who helped prosecute Black. ''At the very least, obstruction stands. The judge could send him back to serve the rest of his sentence.''
Judge St Eve may consider Black's request for permission to travel to Toronto, where he has a home with his wife, Barbara. The judge told defence lawyers on Wednesday that she would not allow him to leave the US without seeing a financial statement and an assessment from a federal agency on the risk of letting him out of the country.
Currently, Black has no equity in his former Palm Beach house, and his Canadian assets are tied up by a court order, Miguel Estrada, an lawyer for Black, said during Wednesday's bail hearing.
The IRS said Black failed to pay taxes on his personal use of Hollinger jets, corporate money he spent on papers by Franklin D. Roosevelt and his private secretary, and Hollinger's purchase in 2000 of a $US5.9 million New York apartment for his use. Black wrote a biography of Roosevelt.
Black has asked the US Tax Court to throw out its assessment, which covers payments due for 1998 to 2003. He said in a petition that the IRS relied on ''sloppy and careless'' findings, from an investigation that led to his conviction, when authorities compiled estimates of his income and unpaid taxes.
Black said he was not required to file tax returns because he was not a US resident, court records show.
Black led Hollinger as its chief executive from 1995 to 2003, and he served as its chairman from November 2003 to January 2004. The Chicago-based company is now known as the Sun-Times Media Group.
A Canadian court froze Black's assets in 2006 after his former holding company Hollinger sued him for $US700 million, the Chicago Sun-Times reported.
Black and three associates were found guilty of stealing $US6.1 million from Hollinger International as they engineered sales of its assets.
If Black succeeds in getting all his convictions overturned, prosecutors have the option of retrying him. A spokesman for the Chicago US Attorney, Patrick Fitzgerald, whose office prosecuted Black, declined to say if that was what the government would do.
''That hasn't happened yet,'' the spokesman said.
Bloomberg
