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Conrad Black granted bail Add to ...

Conrad Black could be out of jail this week after scoring a major legal victory in his ongoing battle to overturn convictions for fraud and obstruction of justice.

A federal appeal court granted Lord Black bail on Monday while it re-considers his convictions in light of a U.S. Supreme Court decision last month. The ruling means Lord Black could be released within days from the Florida prison where he has been for more than two years once a lower court judge sets the bail conditions. While the appeal court did not release reasons for its decision, legal analysts said it is an indication his convictions could be reversed.

"Wow," said Chicago securities lawyer Andrew Stoltman, who has followed the case. "I would say he's pulled off the Hail Mary. Nobody gave him a chance, and now he's out on bail, and that's a real good sign that his conviction is going to be overturned or at least he's going to be released on time served on the obstruction of justice charge."

Lord Black was unavailable for comment. His lawyer, Miguel Estrada, said he was "pleased" with the ruling and hopes to have the bail terms set quickly by district Judge Amy St. Eve, who presided over Lord Black's trial in Chicago in 2007. "We will see when I can get in front of Judge St. Eve to set the terms. We have to get there and figure out when she is available," Mr. Estrada said in an e-mail.

The ruling by the appeal court is a vindication for Lord Black on several fronts. The same appeal court rejected his two previous requests for bail, while granting bail for others convicted in the case, and it abruptly dismissed the initial appeal of the convictions in 2008. Lord Black fought on to the U.S. Supreme Court, and in a ground-breaking ruling last month, the high court narrowed the interpretation of a key legal theory used in this case and several others. As a result of the new definition, the Supreme Court said the jury in Lord Black's case had received improper instructions on the fraud charges and it sent the case back to the appeal court for review.

Now the same three appeal court judges who have consistently ruled against Lord Black will have to decide whether there is still enough evidence to uphold the fraud charges. As a first step, the judges had to rule once again on Lord Black's request for bail. This time they granted it quickly, meaning they agreed with Mr. Estrada that the Supreme Court's ruling had raised a substantial question of law.

"I'm surprised," said Eric Sussman, who led the prosecution in the case and is now in private practice in Chicago. "But then again, there are very few things in this case that have not surprised me."

Until now, Lord Black had been the only defendant in the case still behind bars. He and three other former executives of Chicago-based Hollinger International Inc. were convicted of fraud in 2007 over the misappropriation of $6.1-million (U.S.). Lord Black was also convicted of obstruction of justice. He received a 6 1/2 year jail sentence, far more than anyone else. John Boultbee, who is out on bail pending the appeal, received 27 months, while Peter Atkinson got a 24-month sentence and has been released. The third defendant, Mark Kipnis, received five years probation, which has been reduced. Another former executive, David Radler, pleaded guilty and testified against the others. He received a 29-month sentence, but was released after serving about 10 months.

Legal analysts said that if the appeal court reverses fraud convictions in the case, prosecutors will have to decide whether to re-try the charges. The appeal court could also reverse the obstruction of justice charge, ruling that it cannot stand if the fraud charges are dropped. If the court upholds only the obstruction charge, legal analysts say Lord Black would be re-sentenced and probably released on time served. Either way, it is likely that Lord Black's jail time is over.

It's not clear where Lord Black will go once he is released on bail. His house in Palm Beach, Fla., is up for sale, and property records show the deed to the mansion was transferred to Blackfield Holdings LLC, a Connecticut-based investment firm, to settle an $11.6-million loan. A Blackfield spokesman has said that Lord Black "retains an interest in the property and he has some flexibility regarding its future." Lord Black's wife, Barbara Amiel-Black, has been living there.

In 2005, when Judge St. Eve granted Lord Black bail before his trial started, she ordered him to remain in the United States. However, at that time, Lord Black was facing 17 criminal charges and the possibility of decades in jail.

Lord Black still faces several civil suits and a move by U.S. tax officials to force him to pay $70-million in taxes and penalties. The U.S. Internal Revenue Service alleges Lord Black failed to pay taxes on $116-million in income between 1998 and 2003. Lord Black's lawyers have challenged the assessment in court, arguing that he was "neither a citizen nor a resident of the United States" and was not obliged to pay taxes there.



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See an interactive timeline of Conrad Black's business pursuits throughout the decades See documents, evidence, from the archives



 

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