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  • Supreme Court Strikes a Blow Against Overcriminalization

    United States Supreme Court

    Exposing the extent to which criminal law has expanded, the Supreme Court today narrowed the scope of the federal “honest services” fraud statute and called into question the validity of Enron executive Jeffrey Skilling’s conviction.  Justice Sonia Sotomayor and two other “liberal” justices would have gone even further than the majority and granted Skilling a new trial.  All nine justices agreed, however, that the government’s “honest services” theory overreached.

    Using astoundingly vague, overbroad language, the “honest services” statute makes it a federal crime, punishable by up to 20 years in prison, for anyone to engage in a “scheme or artifice to deprive another of the intangible right to honest services.”  At best, such free-ranging criminalization operates as a trap for the unwary. At worst, it destroys lives.

    Consider the 2006 conviction of Wisconsin civil servant Georgia Thompson.  Thompson was in charge of procuring travel services for state employees. Her “honest services” violation was awarding a contract to the travel agency with the second-best service and lowest price. Neither Thompson nor anyone else was accused of taking a bribe, receiving a kickback, or having an interest in or connection with the winning bidder.

    Instead, according to federal prosecutors the improper benefits Thompson derived from awarding the contract to the winning bidder was “mak[ing] her supervisors look good” and “improv[ing] her job security.” In short, Thompson was charged with doing a good job.

    A three-judge appellate panel eventually ordered Thompson’s immediate release from prison. By that time, however, Thompson had already spent more than $100,000 in legal fees and lost her home, her job, and her reputation. She had also served four painful months in a federal penitentiary after prosecutors refused her request to remain free pending appeal.

    The Court concluded in today’s decision that when Congress enacted the “honest services” statute it intended to limit the law to real crimes – bribery and kickbacks.  The majority based this on judge-made law that the Court itself struck down in its 1987 decision in McNally v. United States.  This result is a step in the right direction.

    But as Justices Scalia, Thomas, and Kennedy explained in their concurrence, the pre-McNally cases really “provide no clear indication of what constitutes a denial of the right to honest services.”  While the legal invention limiting the scope of the statute is welcome, it certainly is more creative than correct.  And it fails to explain why the “honest services” statute should criminalize bribes and kickbacks when they are already – and far more clearly – defined as crimes under multiple federal and state laws.

    Skilling also argued that the poisonous atmosphere that the Houston Chronicle and other media outlets created in Houston after Enron’s demise made it improper for the trial judge to deny his motion to move the trial to another city.  As Justice Sotomayor pointed out in her dissent (joined by Justices Stevens and Breyer), when it came to Enron and Jeffrey Skilling, the media eschewed the restraint it often displays when describing accused terrorists, murderers, and rapists.  Among many other imputations of guilt, the Chronicle characterized the indictment of Skilling as “long overdue,” referred to him as an “idiot,” and derided his attempts to fight the charges as “the doofus defense.”  Only about five percent of the prospective jurors said they did not regularly read the Chronicle.  Sotomayor and two other justices thus found it unsurprising that two-thirds of the prospective jurors freely used terms such as “greedy,” “deceitful,” “totally unethical and criminal,” “a crook,” and “guilty as sin” to describe Skilling.

    The majority, however, rejected Skilling’s claim.  The Court agreed that Enron’s demise and Skilling’s trial were “prominent,” but said that prominence “does not necessarily produce prejudice, and juror impartiality . . . does not require ignorance.”  The majority emphasized that Houston is a large city with a “large, diverse pool of potential jurors,” that four years elapsed between Enron’s bankruptcy and Skilling’s trial, and that the jury acquitted Skilling of other counts against him.  The Court did not find the evidence of actual prejudice among jury members to be conclusive.

    The Court decided two other “honest services” fraud cases today.  Canadian newspaperman Conrad Black was convicted because he allegedly did not provide enough detail to his corporate board of directors about how he chose, for tax purposes, to characterize payments to which he was entitled.  It did not matter to the government or the lower courts that Black was entitled to every dollar he received, that his tax characterizations were perfectly legal, or that his companies lost nothing.   Alaskan state legislator Bruce Weyhrauch was charged based on an alleged conflict of interest even though prosecutors have essentially admitted that Weyhrauch had not violated any conflict-of-interest or ethics law.  Both cases were vacated and remanded to the lower federal courts for further consideration in light of the Supreme Court’s decision in the Skilling case.

    Posted in Legal [slideshow_deploy]

    5 Responses to Supreme Court Strikes a Blow Against Overcriminalization

    1. Drew Page, IL says:

      I am shocked, shocked to learn that Congress has passed a vague law. I wonder if anyone of those who voted for this law bothered to read it. After all, that might takes weeks and a couple of good lawyers.

    2. Drew Page, IL says:

      I am shocked, shocked to learn that Congress passed a vague law. One wonders if any of those who voted to pass this law took the time to read it, but then that might have taken weeks and a couple of lawyers.

    3. Spiritof76, NH says:

      So. why not charge the prosecutor under the same statute and claim he violated "honest services" by bringing charges against Georgia Thompson. We need to put a few prosecutors behind bars to make sure that the justice system is above politics. I wonder where would Georgia Thompson go to redeem her life. It doesn't matter to those slimy crooks in the DA's office.

    4. Lynn Bryant DeSpain says:

      Isn't it odd that everyone believes the Law to be either Black or White, when in actuallity is is neither, fore it is al Gray and beyond sight. Therefore it must remain in the realm of what would a "Common Man" understand when reading the supposed 'Law'.

    5. TaShaun Brown says:

      This was a very encouraging article. Government overreach and overcriminalization has been building unchecked for years.
      A new bill called “The Fresh Start Act of 2010″ is currently with the House Judiciary Committee, and is one of many initiatives we need to restore some sensibility to our justice system. The bill removes the lifelong stigma placed on one-time non-violent offenders by giving them a chance to clear their records and become employable contributing members of society again, if they prove worthy. Among other things, this will reduce recidivism as well as a tax burden on American taxpayers by making it possible for people to return to work.
      The bill is HR5492, and it is one of the few bills in congress right now that will move us in the right direction, in terms of fiscal responsibility and personal freedom.
      TB of New York

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