A lawyer representing the estate of Enron Corp. founder Kenneth Lay on Wednesday filed a motion to begin the process of erasing Lay’s felony convictions for securities and bank fraud. Lay, 64, who was scheduled to be sentenced in October, suffered a heart attack and died in July (see Daily GPI, July 6).

Because Lay’s death occurred before he had begun an appeal or been sentenced, his record may be extinguished. U.S. District Judge Sim Lake, who had presided over Lay’s trial as well as that of his co-defendant and former Enron COO Jeffrey Skilling, is expected to grant the motion. The legal filing by Washington, DC-based lawyer Samuel J. Buffone requires Lake to approve substituting Lay’s estate as a party for the deceased so that the estate may move to vacate Lay’s convictions and dismiss the indictment (Cr. No. H-04-25 (S2).

Although Lay’s conviction is expected to be set aside, his remaining assets could become targets of civil litigation, and they still could be challenged for seizure by the federal government. During his trial, Lay claimed he had lost most of the millions he had made in the preceding years, claiming he only had a Houston condominium valued at $5 million and about $6.3 million in investments.

Skilling, who is still scheduled to be sentenced Oct. 23, owes his legal team about $30 million, which is in addition to about $23 million earmarked for legal costs when he was first indicted in early 2004. The government has filed claims to seize about $60 million from Skilling in cash and property, which has been frozen since the indictment.

In related news, an email has been forwarded to several “friends” of Skilling’s and Lay’s by two former colleagues. The email, which is making the rounds in Houston, made its way to the public via Houston Chronicle business reporter Loren Steffy, who published it in his blog. The note concerning Lay and Skilling, penned by former Enron spokeswoman Terri James and former Enron videographer Beth Stier, said in part, “Because we feel such sympathy for what they and their families are going through, we want to do something that could help ease their pain in some small way during this time.”

The two women said they are putting together a collection of letters for Skilling and a separate collection of letters for Lay’s family from former Enron employees. “We hope that these letters will let Ken’s family and Jeff know that Enron did impact people’s lives in a positive way.” However, they acknowledged, “Obviously, not everyone will feel comfortable participating in this project. We understand and respect that decision. However, we believe some of you might want an opportunity to pass along a pleasant memory, a thoughtful good wish, or a fond goodbye. Ken’s family and Jeff would probably be especially interested to hear about where you are, who you are working with, or perhaps what business you are helping to build. What did Enron mean to you? How was your life enriched by the experiences you had there? Has your life moved in a positive direction which you may never have anticipated? Did what you learned at Enron help you get where you are today?”

The women, who requested that the respondents include details on their position and division at Enron, asked the letters be sent by Aug. 21. They said they planned to assemble the letters into books for the families. “We would like to give Ken’s family their book in a somewhat quick time frame, to perhaps alleviate their grief a bit. We will give Jeff his book before he is sentenced.”

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