When Charlie Prestwood retired to his small rural home north of Houston, after 33 years of working in a power plant, he knew exactly what he had in his nest egg.
"1,310,570 dollars and some few cents. That was my life savings," Prestwood said.
Today that nest egg is gone. Like thousands of other former Enron employees, he is still struggling to recover from his loss. He says at his age, 67, he won't live long enough to ever recoup that money.
Prestwood gets by on his Social Security checks, watches every penny he spends, and prays nothing will go wrong with his house, his truck or his health. He blames Enron's top management.
A Vow to Clear His Name
At one time, Enron was the largest energy trader in the world. It declared bankruptcy and unceremoniously sacked thousands of employees. It also froze its employees' 401(k) retirement programs for a time, during which many workers found most of their life savings wiped out, as Enron's stock plummeted from $90 a share to less than $1 share in just weeks.
Enron founder Ken Lay and CEO Jeff Skilling are to go on trial today for allegedly lying about the health of their company while dumping half a billion dollars of their own stock, charges that both deny. Lay, in a speech to the Houston Forum Club last month, vowed to clear his name, and that of the company he built and loved.
"I will testify at my trial," he said. "I will do my best to get the truth out. I for one do not wish to leave the responsibility for undertaking the difficult task of clearing Enron and my name to my children or my grandchildren or those willing to dig through the rubble long after we are gone".
Lay blames one person for the collapse of Enron -- former chief financial officer Andrew Fastow.
"Did I wonder if I have a crook right in the middle of my senior management ranks? " Lay said. "I never did do that in 35 years. You don't expect that after a lot [of] the vetting that these people go through, plus working with him for years. But sometimes you can be sadly tragically mistaken in that."
Fastow pleaded guilty to two charges of conspiracy and agreed to a 10-year prison sentence once he testifies against Lay and Skilling.
The Lay and Skilling defense teams have spent a staggering $30 million preparing for this trial. Phil Hilder, a former federal prosecutor, knows that both the prosecution and defense face a daunting challenge.
"The stakes are huge. The Enron Task Force will be defined by a victory or a defeat in this case, and a lot rests on them," Hilder said. "I think the prosecution has a formidable task. They are going to have to synthesize a very complex tale and whittle it done to simple things that a jury can understand. Did they in fact mislead the investing public as to the well-being of Enron?"
Making the jury understand is a huge hurdle for the defense. But Skilling's lead defense attorney Daniel Petrocelli says it really is very simple.
"We are saying there was no conspiracy. There was no fraud. This just didn't happen," he said.
The challenge, according to Petrocelli, is the public presumption of guilt.
"Mr. Skilling has been declared guilty by the public without ever having a shred of evidence declared against him," Petrocelli said. "And we are going to do our very best to destroy all the myths about what happened at Enron over the last four or five years and about Jeff Skilling."
Rusty Hardin understands the challenge. He represented the accounting firm of Arthur Andersen when it was indicted by the government in connection with the collapse of Enron.
Arthur Anderson was convicted. That conviction was eventually overturned by the Supreme Court. But it was too late. Arthur Andersen is no more. Hardin doesn't believe Lay and Skilling can get a fair trial in Houston.
"I just know this city was tremendously scarred and seared by the consequences of the fall of Enron," Hardin said. "I know as far back as four years ago when I was defending Arthur Andersen, when jurors were asked about Enron they would literally shake they were so angry in giving their answers."
A Very Personal Stake
Cathy Peterson is still angry. Her husband, Bill, was an Enron employee. He was being treated for cancer when Enron declared bankruptcy. When he lost his job, he lost his health insurance -- a matter of life and death.
"We really suffered. We suffered financially and emotionally," Cathy Peterson said. "We sold our home, our second car, anything we could live without we did without, cell phones, newspapers. I learned to buy the cheapest food we could buy. We moved in with my twin sister. My husband was not allowed the dignity of dying in his own home."
Peterson plans to attend the trial.
"I would like to go one or two days just in memory of my husband. I think justice needs to be done," she said. "There are so many people who suffered who can no longer tell their stories, because they are just too broken."