A federal judge declined to dismiss securities fraud charges against former Adelphia Communications Corp. executive Michael Rigas, whose criminal trial ended last July with a deadlocked jury.
Monday's ruling paves the way for the Manhattan U.S. Attorney's office to retry Rigas on securities fraud charges.
Rigas was on trial for nearly five months earlier this year with his father, Adelphia founder John Rigas, his brother, former Chief Financial Officer Timothy Rigas, and a fourth former executive. John and Timothy Rigas were convicted of conspiracy, bank fraud and securities fraud in July.
Prosecutors accused them of orchestrating an accounting fraud that concealed more than $2 billion in debt and drove the cable company into bankruptcy protection. All four defendants were acquitted of wire fraud, and former executive Michael Mulcahey was acquitted on all counts.
Michael Rigas was acquitted of conspiracy and wire fraud, but the jury deadlocked on the securities and bank fraud charges against him. In a hearing last week, federal prosecutors said they agreed to drop the bank fraud charges against Michael Rigas, but planned to retry him on securities fraud charges.
At the hearing, Michael Rigas' lawyers asked U.S. District Judge Leonard Sand to acquit him of securities fraud, based on the jury's "not guilty" verdict on the related conspiracy charge and what they claimed was insufficient evidence.
Andrew Levander, who represents Michael Rigas in the case, also cited evidence he presented in the trial that his client reimbursed Adelphia for numerous expenses, large and small.
During the trial, Michael Rigas' lawyers sought to separate him from the evidence of lavish living at the company's expense that was pinned on John Rigas and Timothy Rigas.
Witnesses testified John and Tim Rigas charged Adelphia for personal expenses that included golf club memberships, bedroom slippers, church dues and a salaried masseuse.
In his Monday ruling, Judge Sand argued that some jurors may have found that Michael Rigas, a Harvard law school graduate, intended to commit securities fraud, even without having conspired to do so.
"Some of the jurors may well have concluded, despite these contrasts between his actions and those of the two convicted defendants, that when this well-educated graduate of a top-ranking law school signed or approved documents he allegedly knew contained false and deceptive statements, he acted intentionally and with the requisite criminal intent," Judge Sand wrote in his opinion.
During the trial, prosecutors presented public filings and compliance certificates signed by Michael Rigas that contained allegedly false statements. Witnesses also testified that he approved press releases containing false statements.
Adelphia, which is based in Greenwood Village, Colo., is operating under bankruptcy protection.