After 14 hours of deliberation, jurors in the false gas price reporting case of former Dynegy gas trader Michele Valencia and former El Paso Merchant Energy vice president Greg Singleton reached a verdict on some counts but not others.

In their sixth note to the court, jurors said that they had agreed on Valencia counts 15 through 23 and Singleton counts seven through 9. These represent all of the wire fraud counts facing each defendant. Each also faces one count of conspiracy. Valencia faces 13 counts of false reporting, and Singleton faces four.

At the end of the day Thursday, U.S. District Judge Nancy Atlas told lawyers that she would consider giving them the opportunity to reopen their closing arguments without exhibits, a highly unusual move, in an effort to give clarity on the issues to jurors. The judge said she would research precedent on such a move before court resumes at 8:30 Friday. Should jurors fail to reach agreement on the remaining counts Friday, a mistrial on those counts seems likely.

The two defendants face multiple counts of conspiracy, false reporting and wire fraud for allegedly submitting false data and information to publishing companies Inside FERC’s Gas Market Report and Natural Gas Intelligence in an effort to manipulate published gas price indexes and the natural gas market.

On Wednesday, several questions posed by the seven-man, five-woman jury indicated to Atlas that they may be hung. The jurors had struggled with the meaning of “price” versus the meaning of “index.” They then sent a note to the judge on Thursday, saying, “We are deadlocked, starting with the first count and all others,” referring to the conspiracy counts. The note said jurors didn’t agree on how evidence fit the false reporting and conspiracy counts “and neither side will change.”

The trial, which began July 10, included many details of the often complicated natural gas market. It also offered a variety of arguments from the defense and prosecution. Attorneys for Valencia and Singleton argued that the defendants were low-level employees following orders, and that false price reporting was a widespread practice not known by the defendants to be illegal. They said that the defendants’ actions were designed in part to counteract the market manipulating influence of Enron Corp. through its EnronOnline trading system. But they also argued that it could not be proved that the bogus data sent to publishers had an impact on published indexes.

Prosecutors countered that it is only necessary to prove that the false price reporting was intended to manipulate the index. They also said with salaries in the low-six figures in Valencia’s case and $650,000-plus in Singleton’s case, the two defendants were not just low-level employees. But even if they were just following orders, it’s not an adequate defense to say “my boss told me to do it,” government attorney Belinda Beek told the jury. “I guarantee you if your boss told you to go and rob a bank, you would be [found] guilty.”

Prosecutors also said that the false data reported could not have been designed to counteract Enron’s market manipulating influence because at times the data submitted by the defendants actually supported Enron’s market position. Furthermore, prosecutors said there’s no justification for engaging in illegal activity to counteract illegal activity (see Daily GPI, Aug. 2).

Three other former El Paso traders are slated to go to trial in Houston in November on fake reporting charges. Another nine former traders from El Paso, Reliant Energy and the Williams Cos. have pleaded guilty to fake trade reporting or market manipulation charges in Texas and California.

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