Scrushy spared perjury charges

Ousted HealthSouth leader Richard M. Scrushy is chalking up a small victory in his fraud trial after a judge dismissed perjury charges against him.

In a ruling April 12, U.S. District Judge Karon O. Bowdre threw out three counts of perjury that stemmed from statements Scrushy allegedly made to the Securities and Exchange Commission. She said the statements could not be used because the SEC and the U.S. Justice Dept. had improperly merged their civil and criminal investigations of the accounting scandal at HealthSouth.

The ruling was a small but welcome win for Scrushy, who has been on trial since Jan. 5 watching as a parade of prosecution witnesses have depicted him as the mastermind of a $2.6 billion accounting fraud at HealthSouth. He has alleged that other HealthSouth executives conspired to inflate earnings and hid their plot from him.

Scrushy still faces 55 counts of charges ranging from securities fraud and money laundering to conspiracy. If convicted of all charges, he could be sentenced to life in prison. Still, the dropped perjury counts could help improve his case and his credibility with jurors.

The dismissal came after an SEC investigator testified that his office had cooperated with requests from the U.S. Attorney's Office about a deposition of Scrushy. Also, at the time of the deposition, Bowdre said the investigator failed to advise Scrushy or his lawyers that the HealthSouth founder was the target of a criminal investigation.

At least 18 other HealthSouth executives have pleaded guilty to criminal charges in the case since the scandal was first revealed in March 2003.

Meanwhile, HealthSouth disclosed in a regulatory filing that it paid executives about $6.1 million in bonuses last year, including $500,000 to Chief Executive Officer Jay Grinney.