Trial, Day 19: Funny strange, not funny ha-ha

Yesterday in the Lay/Skilling trial, defense lawyers hit witness Kevin Hannon right where it hurt: in the funny bone. Hannon, the former CEO of Enron Broadband Services, testified Thursday that ex-Enron CEO Jeff Skilling told executives during a May 2001 meeting, "They're on to us," referring to a Wall Street investment firm questioning Enron's earnings. On Monday, Skilling lawyer Mark Holscher asked Hannon whether Skilling might not have made the statement sarcastically: "Anything's possible," Hannon said. To reinforce that possibility, Holscher tried to prove to the jury that Hannon just isn't a funny guy.

"Do you remember Mr. Skilling saying at the meeting that this is a pile of short-seller crap?" Holscher asked. Hannon did not.

He also said he didn't recall Skilling saying jokingly,"Oh nooooo, Mr. Bill!," in parody of an old Saturday Night Live feature in which a clay figure named Mr. Bill was regularly squashed.

"You're a kind of tightly wound and intense person, aren't you?" Holscher asked. Hannon, who was stiff on the stand, agreed he was at times.

Excuse us for a second while we recover from the devastating wit of Jeff Skilling.

Ah, yes. Also in the cross-examination, Lay lawyer Bruce Collins asked Hannon why he didn't remember the details of an August 2001 meeting he said he had with Lay until later (Hannon said the meeting concerned financial problems with a British utility that could have Enron to take an $800 million write-down, a possibility Lay is accused of misrepresenting to the public). Hannon said he remembered details as he looked at his calendar, underwent government questioning and had more time to put things together, but he acknowledged that he has no notes, e-mails or other documentation backing up the content of the meeting. Defense lawyers also pressed Hannon on why he lied to the SEC in 2002, then changed his story and began cooperating with the government. Hannon said he thought he could fool the SEC, but he doesn't think he can fool the jury — which, to Houstonist, is something of an interesting look at Enron executives' approach to the government.

Hannon will testify for about an hour this morning, after which former Enron CFO Andrew Fastow will take the stand. His testimony should be interesting: Prosecutors will try to use him as a link between ex-Chairman Lay, Skilling and the alleged conspiracy and fraud they say brought Enron down, while the defense will probably try to blame the company's demise on Fastow. Fastow's testimony may close out the trial's sixth week.