By Roger Parloff

(FORTUNE Magazine) – IN THE COMING MONTHS, INVESTMENT banker Frank Quattrone has an excellent chance of becoming the first big fish snared in the bubble-era corporate crime scandals to be thrown back into the sea.

With his obstruction-of-justice conviction up for review before a federal appeals panel in New York City this summer, it's easier to predict a reversal than to foresee on which of two competing grounds that reversal might be based: Will it be the legal insufficiency of the prosecution's whisker-thin case or the alleged pro-prosecution bias of U.S. District Judge Richard Owen?

In spring 2000, when Quattrone headed Credit Suisse First Boston's technology unit in Palo Alto, the NASD and SEC began looking into allegations that CSFB had received kickbacks from hedge fund managers who wanted to invest in oversubscribed tech stock IPOs. That November a federal grand jury began an inquiry too. On Dec. 5, 2000, just two days after being told about the criminal probe and on the very day he was advised to retain a lawyer for it, Quattrone endorsed a subordinate's e-mail entitled "Time to clean up those files," which reminded everyone in his unit to follow the firm's document retention policy. That policy--which was supposed to be suspended whenever documents were sought by subpoena--urged bankers to destroy all the records in their deal files except a short list of key documents.

Though the facts might appear damning, Quattrone never saw any of the subpoenas--they went to lawyers in CSFB's legal-compliance department, who were to notify affected employees of the documents they needed to preserve. In the kickback inquiries, most of the documents sought were kept by CSFB units in New York. CSFB's lawyers instructed Quattrone and his staff to preserve documents relating to only two IPOs, which they did.

Unbeknown to Quattrone, however, in September the SEC had actually requested documents on hundreds of CSFB's IPOs. Inexplicably, CSFB's lawyers never issued correspondingly broad document-preservation orders to Quattrone. We don't know why, because Judge Owen forbade Quattrone's defense team from exploring that question before the jury.

There was no evidence that the timing of the file-cleaning e-mail was anything other than unfortunate coincidence. Its author and initiator, Quattrone's subordinate Richard Char, did not know about the existence of either the SEC or grand jury inquiries. Before sending his e-mail, Char copied a draft to the tech unit's top lawyer, Adrian Dollard. But Dollard, who also hadn't been told about the subpoenas by CSFB's compliance lawyers in New York, raised no objection. In fact, though Judge Owen barred the jury from finding it out, Dollard actually gave a training session the next day instructing tech-unit bankers on how to follow the document- retention policy!

Quattrone's crime consisted of adding his own two cents to Char's memo--as was his common practice on department-wide administrative memos--by sending a brief reply-all message underscoring the need to heed Char's e-mail. Quattrone testified that there was simply no connection in his mind between Char's end-of-year memo and the grand jury probe he had just learned about. He assumed CSFB's compliance lawyers were keeping him up to date on any document categories for which the retention policy was to be suspended.

Just three days after Char's e-mail went out, CSFB's compliance lawyers issued the broad document-preservation order that they probably should have issued two months earlier. As a consequence, there was little evidence of actual document destruction resulting from Char's e-mail. No incriminating documents ever turned up that might have provided a motive for Quattrone's having plotted to destroy them. The NASD, SEC, and grand jury all closed their inquiries without even asking to interview him. But, again, Judge Owen kept out those facts, ruling them irrelevant because an attempt to obstruct justice need not be successful to constitute a crime.

Judge Owen's pro-prosecution reputation is no secret among Manhattan criminal practitioners. Back in 1988 journalist Steven Brill described in The American Lawyer how two federal prosecutors, upon learning that Judge Owen would be presiding over their case, "grinned from ear to ear" and "clapped each other on the shoulder" in congratulations. "Sure we grinned," one of them admitted to Brill. "Owen's one of the best judges in the house for us." Judge Owen declined any comment for this article.

Judging from the trial transcripts in Quattrone's case, Judge Owen, 83, has not turned more impartial with age. The National Association of Criminal Defense Lawyers has submitted an amicus brief supporting Quattrone's appeal, based solely on what it calls the trial judge's "transparent bias"--a rare, if not unique, step for that group to take. Though it's quite unusual for any defendant to win reversal based on a trial judge's bias, it's also rare to see a conviction based upon evidence as thin and troubling as that in Quattrone's case. Confronted with the case of a very possibly innocent man convicted before a very famously pro-prosecution judge, the appeals court may finally be pushed past the tipping point. -- Roger Parloff