Jury clears ex-Delphi head of most serious charges

DETROIT (AP) — The former chief executive of Delphi Corp. was cleared Thursday of the most serious charges in a civil trial tied to allegations of financial fraud at the auto-parts maker in 2000.

Jurors found J.T. Battenberg III liable on three of the seven charges relating to how Delphi accounted for a $237 million transaction involving warranty costs with its former parent, General Motors Corp.

He and former Delphi accountant Paul Free were cleared of fraud but found responsible for bookkeeping errors and misrepresentations to accountants. Separately, Free was found liable on several charges regarding other transactions at the company. The lawsuit was filed by the Securities and Exchange Commission.

“The finding of no fraud is extremely gratifying,” Battenberg, 67, told The Associated Press.

SEC lawyers declined to comment. Free and his lawyer could not immediately be reached.

The jury heard nearly 30 days of testimony beginning in October, and deliberations started Jan. 5.

The SEC filed a lawsuit against Delphi and its executives in 2006, alleging that the company manipulated its earnings through several schemes from 2000 to 2004, including the concealment of the GM transaction. Delphi restated its earnings in 2005.

Battenberg’s lawyer, William Jeffress Jr., said the verdict was satisfying, although “we’re disappointed that they found he violated anything.”

He said he could ask U.S. District Judge Avern Cohn to consider the evidence and overrule the jury’s findings of liability. Free and Battenberg likely face financial penalties.