Supreme Court Allows Challenges to Jury Deliberations Based on Evidence of Racial Bias

What should a court do when confronted with evidence of racial bias in jury deliberations? At common law, once a case was over a verdict could not be challenged based on evidence of what happened during jury deliberations. This historical rule against the impeachment of jury verdicts is codified in Rule 606(b) of the Federal Rules of Evidence. The rule serves to encourage free and frank communications within the jury room, to prevent the harassment of jurors once a case is over, and to promote respect for and finality of jury verdicts.

Last week in United States v. Peña-Rodriguez the Supreme Court ruled 5-3 that the Constitution requires an exception to this rule when there is evidence of racial bias in jury deliberations. (I first wrote about the case when it was argued last fall, you can find that post here.) Faced with the evidence of such bias, the Court was understandably reluctant to leave the defendant without a remedy. But the implications for the jury system go far beyond this single case.

The Issue in Peña-Rodriguez

A Colorado jury convicted Mr. Peña-Rodriguez of unlawful sexual contact with two young women. After the case was over, two jurors reported to his defense attorney that another juror had demonstrated bias against Hispanics during deliberations. That juror reportedly made several statements demonstrating his prejudices, including that the defendant was likely guilty because Mexican men have a macho attitude and believe they can take whatever they want when it comes to women.

The Colorado courts ruled Peña-Rodriguez could not challenge his conviction based on this evidence. Colorado has a rule similar to Federal Rule 606(b), which prohibits the impeachment of jury verdicts based on evidence of what happened during deliberations. The great majority of states follow this same rule.

Nine states, however, follow a more relaxed standard known as the Iowa rule. These states prohibit inquiry into a juror’s own subjective beliefs following a verdict but do allow scrutiny of things that take place during deliberations, including statements reflecting bias by other jurors.

Scene from 12 Angry Men - Racial Bias in Jury Deliberations

Confronting Racial Bias in Jury Deliberations

Peña-Rodriguez argued in the Supreme Court that his Sixth Amendment right to a fair trial required that he be allowed to challenge his conviction. In an opinion by Justice Kennedy, the Supreme Court agreed. The Court ruled there must be an exception to the no-impeachment rule when there are allegations of racial bias in jury deliberations.

The Court held, in effect, that race is different. Our country has a long and troubled history involving racial discrimination, including within the justice system itself. In light of that history, it is essential that there be mechanisms to ensure racial bias does not infect jury verdicts. When there is evidence of such bias, there must be a remedy: “When jurors disclose an instance of racial bias as serious as the one involved in this case, the law must not wholly disregard its occurrence.”

It’s true there are other safeguards against biased jurors, including the voir dire process of jury selection. But the Court argued these might not be as effective when it comes to rooting out potential racial animus. Attorneys might be reluctant to press potential jurors about bias out of fear of alienating or offending them. Fellow jurors might be hesitant to report biased conduct that takes place prior to deliberations because it is difficult to accuse a fellow juror of being a bigot.

The Court noted that not every offhand comment or stray remark will justify a hearing challenging the verdict: “For the inquiry to proceed, there must be a showing that one or more jurors made statements exhibiting overt racial bias that cast serious doubt on the fairness and impartiality of the jury’s deliberations and resulting verdict.” The Court said the statements “must tend to show that racial animus was a significant motivating factor in the juror’s vote to convict.” Determining whether that threshold is met will be up to the discretion of the trial judge, who may evaluate the evidence in light of the entire case.

Notably, the Court did not spell out exactly what procedures a trial court should follow when presented with such evidence. Nor did it specify what exactly a defendant must show in order to set aside a verdict and obtain a new trial. The question before the Court was simply whether a defendant has the right to raise such a challenge at all. The details of how that is done will be worked out in the lower courts.

The Court concluded:

The Nation must continue to make strides to overcome race-based discrimination. The progress that has already been made underlies the Court’s insistence that blatant racial prejudice is antithetical to the functioning of the jury system and must be confronted in egregious cases like this one despite the general bar of the no-impeachment rule. It is the mark of a maturing legal system that it seeks to understand and to implement the lessons of history. The Court now seeks to strengthen the broader principle that society can and must move forward by achieving the thoughtful, rational dialogue at the foundation of both the jury system and the free society that sustains our Constitution.

The Dissenting Opinions

Justice Thomas dissented. He claimed the historical understanding of the right to a jury trial, as embodied in the Sixth Amendment, did not include the right to impeach a jury’s verdict for any reason. As a result, he argued, even if there were sound policy reasons that might cause a legislature to allow such an inquiry, there was no basis for the Court to find that the Constitution requires it.

Justice Alito also wrote a dissent, joined by Chief Justice Roberts and Justice Thomas. He too claimed the Court’s decision, although well-intentioned, lacked a constitutional foundation. Like Justice Thomas, he argued that historically there was no right to impeach a jury’s verdict and such a right thus could not properly be found in the Sixth Amendment. Congress adopted the traditional no-impeachment policy in Rule 606(b), and the Court had no basis to disturb that policy decision.

Justice Alito argued jury deliberations should be protected because jurors are “ordinary people” who “make decisions the way ordinary people do in their daily lives.” They should not be second-guessed by “trained professionals” who “do not speak the language of ordinary people.” In order to ensure free and frank communications, jury deliberations should be immune from scrutiny even if they occasionally reflect potential improper bias. The law protects other communications, such as those between spouses or attorney and client, even when they include evidence of misconduct. The same should be true, he argued, of jury deliberations.

In addition to agreeing with Justice Thomas’s historical arguments, Justice Alito challenged the majority’s empirical claims that other safeguards in the jury system are inadequate to protect against racial bias. He noted there are many resources discussing how to raise the issue of potential discrimination during voir dire without offending potential jurors. He also said it made little sense to  claim a juror might be somehow reluctant to report biased statements prior to deliberations but more willing to report them after the verdict.

Justice Alito noted that although the majority tried to limit its holding, once the no-impeachment rule was breached it would be difficult to limit the rule only to cases involving racial bias.

jury room door - what should a court do with evidence of racial bias in jury deliberations

Opening the Door to the Jury Room

The central dispute in Peña-Rodriguez was not whether the juror’s comments were reprehensible; all agreed that they were. It wasn’t even over whether it would be a good idea to allow the verdict to be impeached. The dispute was simply over who gets to decide: Congress or the Court. The dissenters argued Congress had already made a policy choice by enacting Rule 606(b) and that there was no basis for the Court to intervene. The majority held the Constitution trumps that decision by Congress when racial bias is involved.

The Court’s decision is understandable; it would be difficult for something that calls itself a justice system to provide no remedy at all when confronted with the evidence in this case. But at the same time, bright-line rules do have some advantages. Now that the door to the jury room has been cracked open, a lot of unanswered questions remain.

Justice Alito is correct when he says there is probably no principled way to prevent the Court’s decision from being expanded in the future. As the majority notes, our country’s history with racial discrimination is unique. But when it comes to an individual defendant’s Sixth Amendment right to a fair trial, it is hard to justify a rule that allows challenges to only some types of discrimination. What about juror bias based on the fact that the defendant is a Muslim? Or a woman? Or gay?

The Court held that remedying racial bias in deliberations is necessary in order to prevent “a systemic loss of confidence in jury verdicts, a confidence that is a central premise of the Sixth Amendment trial right.” But surely verdicts that were upheld in the face of other types of discrimination would result in a similar loss of confidence and would require a similar remedy. Logic seems to demand that the Court’s rationale be expanded to other forms of bias in future cases.

Unintended Consequences and Practical Difficulties

 The Court’s decision may have additional unintended consequences. The rule against impeachment of verdicts was designed in part to shield jurors from harassment. There may be greater risk now that attorneys will aggressively seek out jurors after a loss to see if there is information to support a challenge. As the Court observed, those contacts will be limited to some degree by state legal and ethical rules governing when parties and their counsel may contact jurors.

There is also a fear that allowing these challenges will simply drive prejudice underground. Perhaps the biased juror will not speak up, where his ideas may be challenged and refuted by the other jurors, but will simply keep his prejudices to himself out of fear of having his statements challenged later. But this assumes a certain baseline of legal knowledge and perhaps is not a realistic concern. It’s hard to know how much the free-flowing discussion among a jury of Justice Alito’s “ordinary people” is influenced by the intricacies of the law on post-verdict challenges.

Practical issues will confront trial courts faced with a challenge to deliberations. The Supreme Court purposely did not spell out exactly how a court should decide whether a defendant deserves a hearing, or when a court should order a new trial. How does a judge determine whether expressions of bias by a single juror had an impermissible impact on the unanimous verdict of twelve? Should evidence of a single racist juror automatically result in a new trial? Is the court to presume the remaining eleven jurors were passive sheep unable to resist? It may be at least as likely that the remaining jurors rejected the improper views and disregarded any further statements by that juror.

The Peña-Rodriguez jury deliberated for twelve hours. Assessing the impact of a handful of biased statements on that entire deliberative process is a daunting challenge for a judge. It may require examining individual jurors one by one. This again implicates the interests about juror harassment and finality of verdicts that justified the rule against impeachment in the first place. Nevertheless, in those (probably rare) cases where this type of evidence emerges, it will now be up to trial courts to undertake that inquiry, with little guidance from the Supreme Court on how to proceed.

Amending Rule 606, and Schools of Constitutional Interpretation

Now that the Court has constitutionalized the right to challenge some deliberations, it would make sense for Congress to amend Federal Rule of Evidence 606(b) to make something like the Iowa rule the federal standard. Challenges to jury verdicts should be allowed if there is evidence of any kind of improper bias or animus during deliberations. It makes little sense to wait for years while lower courts try to sort out whether Peña-Rodriguez requires them to entertain challenges based on other forms of discrimination.

A final side note: in light of the upcoming confirmation hearings for the nomination of  Neil Gorsuch to the Supreme Court, the different schools of constitutional interpretation highlighted in Peña-Rodriguez are particularly interesting. With its concluding flourish about a maturing legal system confronting the country’s history of racial discrimination, the majority embraced a “living Constitution,” where constitutional norms grow and adapt to support a developing society. The dissenters, on the other hand, represent a classic textualist or originalist view. They interpret the Constitution strictly based on its text and how it was understood at the time it was adopted.

Judge Gorsuch falls squarely within the originalist school of interpretation, as did the man whose seat he would fill, Justice Scalia. It seems likely that if he had been on the Court, Gorsuch would have sided with the dissenters and it would have been a 5-4 decision. This is one of those areas where replacing Justice Scalia with Justice Gorsuch probably would not result in a significant shift in the balance of the Court.

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Why Jeff Sessions Is Unlikely To Face Perjury Charges

Did Jeff Sessions commit perjury? Washington is abuzz over whether the new Attorney General may have lied during his confirmation hearing before the U.S. Senate. During his sworn testimony and in a written questionnaire, Sessions denied having any communications with Russian officials during the course of President Trump’s campaign.

Then last week the Washington Post reported Sessions had met with the Russian ambassador to the United States in July and September of 2016. At the time, then-Senator Sessions was a member of the Senate Armed Services Committee but was also serving as a top foreign policy advisor to the Trump campaign.

In public statements and at a press conference last Thursday, Sessions claimed his responses were truthful. He said he understood the questions to relate only to contacts with Russians on behalf of the campaign. His meetings with the Russian ambassador, he maintained, were in his role as a Senator, not as a Trump campaign surrogate. As such, he did not consider those meetings relevant. Although he said in hindsight he wished he had mentioned the meetings, he said he had no intent to lie.

Attorney General Sessions has now recused himself from any investigation involving President Trump’s campaign. But this has not put to rest the controversy surrounding his Senate testimony. Some Democrats have called on him to resign, and there have been widespread allegations that the new Attorney General may be guilty of perjury.

The political implications of all of this are still playing out. But criminal implications are a different matter. New information may come to light, but based on the facts we have now it’s extremely unlikely a perjury case against Sessions would be appropriate or successful.

Did Jeff Sessions commit perjury? Testifying before Congress.

The Questions and Answers

The precise questions and answers are extremely important in any perjury case. Here is the question posed by Senator Al Franken during the Senate Judiciary Committee hearing on January 10, and Senator Sessions’s response (video here):

Franken: CNN just published a story alleging that the intelligence community provided documents to the president-elect last week that included information that quote, “Russian operatives claimed to have compromising personal and financial information about Mr. Trump.” These documents also allegedly say quote, “There was a continuing exchange of information during the campaign between Trump’s surrogates and intermediaries for the Russian government.”

Now, again, I’m telling you this as it’s coming out, so you know. But if it’s true, it’s obviously extremely serious and if there is any evidence that anyone affiliated with the Trump campaign communicated with the Russian government in the course of this campaign, what will you do?

Sessions: Senator Franken, I’m not aware of any of those activities. I have been called a surrogate at a time or two in that campaign and I didn’t have — did not have communications with the Russians, and I’m unable to comment on it.

As many have observed, Sessions did not answer the question asked. Rather than saying what he would do as Attorney General, he volunteered information about his own contacts with the Russians. After this non-response, Franken did not follow up about Russian contacts but simply said, “Very well,” and moved on.

In a written questionnaire submitted after the hearing, Sessions again denied any contact with Russian officials regarding the 2016 election. In that questionnaire Sen. Patrick Leahy asked: “Several of the President-elect’s nominees or senior advisers have Russian ties. Have you been in contact with anyone connected to any part of the Russian government about the 2016 election, either before or after election day?” Sessions responded: “No.”

The Law of Perjury

The relevant perjury statute, 18 U.S.C. § 1621, applies to any witness under oath who “willfully and contrary to such oath states or subscribes any material matter which he does not believe to be true.” Sessions was under oath. He now admits he met with the Russian ambassador. There is little doubt this information would have been material to the Senate’s inquiry. So as with so many white collar cases, the issue boils down to the potential defendant’s state of mind.

Not all false statements under oath are perjury. A perjury charge requires the government to prove the defendant was deliberately lying. If the witness misunderstood or misinterpreted the question, that is not perjury. Nor is it perjury if the witness didn’t remember relevant information. Even if a witness is deliberately evasive, it’s not perjury if the testimony is literally true. To convict, the government must prove beyond a reasonable doubt not only that the statement was false but also that the witness believed it was false when he made it.

Bronston v. United States

Any discussion of perjury should begin with the leading Supreme Court case, Bronston v. United States (1973). Mr. Bronston testified in a bankruptcy proceeding involving his motion picture company. During that testimony the following exchange took place:

Q:      Do you have any bank accounts in Swiss banks, Mr. Bronston?

A:      No, sir.

Q:      Have you ever?

A:      The company had an account there for about six months, in Zurich.

At the time of this testimony Bronston had no Swiss bank accounts and his company had previously had an account in Zurich. His answers were therefore literally true. It was also true, however, that Bronston had previously held a personal Swiss bank account. That account was closed at the time of his testimony. His non-responsive answer to the second question effectively concealed that information.

The government later prosecuted Bronston for perjury. It alleged that his answers, although literally true, were misleading and left a false impression and therefore constituted perjury “by negative implication.”

The Supreme Court rejected this theory and held perjury requires testimony that is actually false. The Court noted that true statements do not violate the language of the statute, even if they are non-responsive or potentially misleading. The statute requires that the witness make a statement he does not believe to be true.

Even if a witness is deliberately evasive, the Court noted, that is to be expected in an adversary proceeding. The burden is on the questioner to pin the witness down. Perjury will not be charged “simply because a wily witness succeeds in derailing the questioner – so long as the witness speaks the literal truth.”

President Clinton denies allegations concerning Monica Lewinsky

What Is the Meaning of “Is?”

A more well-known example of allegations of perjury involved former President Bill Clinton. When testifying in the grand jury he was asked about a statement made by his lawyer in a civil deposition. His lawyer had stated that Monica Lewinsky filed an affidavit saying there “is no sex of any kind in any manner, shape or form, with President Clinton.” When asked whether that statement by his lawyer was false, Clinton famously replied, “It depends on what the meaning of ‘is’ is.”

As Clinton explained, his lawyer’s statement was present tense – there “is” no sexual relationship. At the time of the statement the relationship between the President and Ms. Lewinsky had ended some time ago. As a result, Clinton testified, the statement that there “is” no sexual relationship was literally true.

The House of Representatives characterized this testimony as perjury in its Articles of Impeachment. But no criminal prosecutor worth his salt would have brought a perjury case. In a trial for perjury the President would have had a rock solid defense: his answer was true. The political consequences of an answer seen as slick and evasive were devastating, but the testimony was not criminal.

Why Proof of Perjury Is So Demanding

As these cases demonstrate, proving perjury is difficult. This is by design. As the Court noted in Bronston, if perjury is not narrowly construed even honest witnesses might fear to testify. Being examined under oath is stressful and unfamiliar territory for most people. Questions may be misunderstood or misinterpreted. Witnesses might forget relevant information. People should not fear being charged with perjury for inaccurate testimony that may have resulted simply from confusion, stress, or misunderstanding.

This is particularly true considering how easy it usually is for a skilled questioner to avoid any such confusion. The questioner must be alert to any evasion or uncertainty and ask appropriate follow-up questions. For example, the lawyer in Bronston failed to ask the obvious next question: “I didn’t ask about the company Mr. Bronston. Did you personally ever have any Swiss bank accounts?” And the questioner in President Clinton’s deposition also failed to follow up: “OK, so you say there is no sexual relationship of any kind. Was there ever?”

It’s not enough if testimony ends up being misleading or unclear. Perjury prosecutions are only successful when a good questioner has removed any reasonable possibility of uncertainty or confusion. Short of that, there is usually too much wiggle room. If the witness later claims the answer was literally true or the question was misinterpreted, proving a deliberate lie beyond a reasonable doubt will be extremely difficult.

Did Jeff Sessions Commit Perjury?

With these principles in mind, let’s consider whether there might be a valid perjury case against Sessions. His critics have focused on his statement to Senator Franken that he “did not have communications with the Russians.” Taken in isolation, that is untrue. But Franken’s question was based on a news report that Trump campaign representatives had been in contact with Russian officials. Sessions’s statement was preceded by his observation that he was occasionally considered a campaign surrogate.

Given the context of Franken’s question and Sessions’s full response, it’s not unreasonable for Sessions to maintain he was referring to any Russian contacts he may have had in his role as a campaign surrogate. Both the question and answer were couched in terms of contacts by the campaign. If it’s true his meetings had nothing to do with the campaign, Sessions could have thought they were not relevant.

Senator Franken has said he believes Sessions should have mentioned the meetings anyway. Sessions himself said in his news conference he now thinks it would have been better if he had done so. But testimony that ends up being misleading or incomplete is not perjury if it is based on an unclear or misinterpreted question the witness thought he was answering.

When it comes to the written questionnaire the potential case against Sessions is even weaker. It specifically asked whether he had communicated with any Russian officials “about the 2016 election.” If in fact his meetings did not involve the election, then his “no” response was completely truthful.

Senator Sessions may have been honestly trying to respond to the questions. He may have been confused or may have interpreted the question differently, as he says. He may have been trying to be cagey to conceal relevant information. Or he may have been deliberately lying. Just as in the case of Mr. Bronston, we’re not sure. And in criminal law, that kind of uncertainty usually translates to reasonable doubt.

Senator Al Franken questions Jeff Sessions

The Unasked Follow-Up Questions

Some have argued that Sessions used his non-responsive answer to pre-empt further questioning by his blanket denial of any contact with the Russians. That doesn’t make a lot of sense to me. Even if you are willing to commit perjury if forced, why go out of your way to lie about something that wasn’t asked? Why try to head off a line of questions that Sen. Franken did not even appear to be pursuing? Sessions could have easily given some non-committal answer about what he would do as Attorney General without exposing himself to possible perjury charges.

In any event, a non-responsive answer does not “pre-empt” further questioning — it invites it. As the Court said in Bronston, the burden is on the questioner to pin a wily witness down. Imagine if Sen. Franken had followed up with this series of questions:

“Well, OK, I didn’t ask you about your own contacts with the Russians, but since you brought it up — are you testifying that you never had any contact with any Russian officials in your role as an advisor to the Trump campaign?”

“Did you have any contact with any Russian officials at all during the time you served as an advisor to the Trump campaign, whether or not those contacts were on behalf of the campaign?”

“Are you aware of anyone else involved in the Trump campaign who had any contact with representatives of the Russian government?”

“Did anyone in the Trump campaign ever ask you to contact any officials in the Russian government on behalf of the campaign?”

If we had answers to these questions, there would be no ambiguity. If Sessions had denied any contact with Russian officials in any capacity at all, the perjury argument would be much stronger. On the other hand, if he had responded truthfully about his meetings with the Russian ambassador, all the controversy of the past week would have been avoided.

Political Remedies v. Criminal Remedies

Critics of Sessions may say I am being too lenient. They may say I am bending over backwards to give him the benefit of the doubt. Yes, I am. That’s how the criminal justice system works. Sessions is innocent until proven guilty – not the other way around. And proving guilt beyond a reasonable doubt to a unanimous jury is a lot tougher than indicting someone on Twitter.

Many are convinced that Sessions deliberately lied. They may be correct. But a criminal case has to be based on evidence, not on gut feelings and suspicious circumstances. Currently the government could muster little in the way of admissible evidence to contradict what Sessions has said about his intent.

Of course this assumes no additional evidence comes to light. If emails, other documents, or witness testimony were to surface indicating that Sessions’s meetings with the ambassador were in fact on behalf of the campaign, that would completely change the picture.

As with President Clinton and his “meaning of is” answer, the political consequences of all of this for Sessions and Trump may be severe. But political remedies are one thing, and criminal remedies are quite another. At least at this stage, those calling for perjury charges are off the mark.

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Emoluments Clause Violations as a Conspiracy to Defraud the United States

If President Trump violates the Constitution’s Emoluments Clause, what might be the remedy? One possibility is a suit challenging such violations as a conspiracy to defraud the United States.

Since Donald Trump was elected, a great deal of attention has been focused on the Foreign Emoluments Clause. This previously obscure provision forbids federal officials from accepting any gifts or emoluments – payments for services rendered — from a foreign state. President Trump maintains an ownership interest in his far-flung business operations and has resisted calls to divest. As a result, many believe he has been violating the Clause from the moment he was sworn in. (For a more detailed discussion of the Emoluments Clause and what it prohibits, see my earlier post here.)

Just last week there were reports of a new Emoluments Clause issue. The Trump Organization apparently had been in a decade-long legal battle to secure a trademark for the Trump name in China. One month after Trump’s inauguration, China finally granted the trademark – even though doing so may have been a violation of its own regulations. This decision came a few days after Trump publicly reaffirmed the U.S. commitment to a “One China” policy. He had expressed some skepticism about that policy shortly after he was elected. The timing of these events raises obvious concerns about the President’s possible divided loyalties and about foreign governments gaining leverage over him. Given Trump’s extensive international holdings, similar potential issues abound.

The Difficult Question of Standing to Sue

If indeed Trump is violating the Emoluments Clause, who can bring a lawsuit to remedy that violation? Plaintiffs in a lawsuit must have standing, a concrete injury that can be addressed by the court. Finding someone with legal standing is a serious obstacle to enforcing the Emoluments Clause. Some argue that only political remedies (including impeachment) are possible. These commentators believe a court likely would find that any private lawsuit based on the Clause presents a non-justiciable political question.

A public watchdog group called Citizens for Responsibility and Ethics in Washington (CREW) filed a lawsuit shortly after the inauguration, claiming that Trump is violating the Clause. CREW asserts it has standing because Trump’s actions have forced it to devote time and resources to fighting him on these issues.  As a result, CREW maintains, it cannot do much of the other work it would otherwise be doing. CREW has some very prominent attorneys working on the case, but many are skeptical of this standing theory.

Others have suggested a competing business might have standing. For example, if the Bank of China sent all its business to the new Trump hotel in Washington, D.C., a competitor hotel might claim it was injured. But it’s not clear a court would uphold such a private right of action. The Clause’s purpose is to ensure government integrity, not to protect private competitors. And even if standing were found, such a lawsuit likely would face significant hurdles in proving causation and damages.

Image of President Trump at a rally - he may have been violating the Emoluments Clause since day one.

Quo Warranto: A Possible Solution to the Standing Issue

Last week a new legal theory concerning how to enforce the Clause began making the rounds (see articles here and here). Prof. Jed Shugerman at Fordham University Law School first proposed the idea. It avoids the problem of establishing standing to sue President Trump directly. Instead, it focuses on pursuing the Trump Organization for its participation in the President’s receipt of foreign emoluments.

Shugerman notes that states may use a procedure know as quo warranto to bring a civil action against a corporation engaged in illegal behavior. Corporations are creatures of state law, and the state has the power to discipline those that act illegally. For example, New York Business Corporation Law § 1101 allows the state attorney general to bring an action for dissolution against any corporation that has “transacted its business in a persistently fraudulent or illegal manner.” Shugerman argues a state could use this procedure to charge a Trump corporation with serving as a conduit for improper emoluments.

The New York Attorney General would be an ideal candidate to bring such a case, Shugerman says, because the Trump Organization is organized under the laws of New York. If the suit were successful, a court could revoke the Trump Organization’s corporate charter. Shugerman and some others have already filed a letter with the New York Attorney General asking him to consider such a lawsuit. Shugerman believes a number of other jurisdictions could bring similar claims against Trump organizations within their state.

The beauty of Shugerman’s theory is that it avoids the problem of finding private individuals with standing to sue the official violating the Emoluments Clause. Instead it involves public officials – the state attorneys general – filing suit against a private company. There’s no question that the attorneys general have standing to bring such a proceeding. But I think potential legal issues remain.

What Constitutes Illegal Behavior for a Quo Warranto Proceeding?

Prof. Shugerman’s theory faces at least one potential roadblock: proving the Trump Organization or related corporations are conducting business in a “fraudulent or illegal manner” within the meaning of the law. For example, Shugerman suggests a suit could be brought against Trump’s new hotel in D.C. for violating its lease with the General Services Administration. But violation of a lease typically would be considered just a breach of contract, not fraudulent or illegal. It would be surprising if every lease dispute potentially subjected a corporation to an action for dissolution.

Similarly, private corporations typically can’t violate the Constitution, which applies to government actors. So it’s probably unlikely the New York legislature had constitutional violations in mind when it wrote the statute prohibiting illegal corporate behavior. A quo warranto suit based on a constitutional violation would face a strong argument that the statute does not apply.

Even if constitutional violations could serve as the illegal conduct for a quo warranto proceeding, it’s not clear the Trump Organization would violate the Emoluments Clause by receiving gifts from a foreign state. The Emoluments Clause bars only actions by federal officials. On its face the Clause does not prohibit anything done by the Trump Organization or any private company. The corporation is a separate legal entity, even if it does bear Trump’s name.

Prof. Shugerman suggests a state attorney general could hold the Trump Organization liable as the President’s corporate “conduit.” I’m not so sure. In general it’s true that corporations can be held responsible for actions of their agents under the doctrine of respondeat superior (“let the master answer”). This holds true for criminal violations as well as civil. But it’s not clear the same principle should apply when it comes to violations of a constitutional obligation imposed only on a government official.

In addition, under respondeat superior the actions of the agent must be within the scope of his authority. Trump reportedly has turned control of his organization over to his sons. If that’s the case, then he arguably no longer has authority to act on behalf of the corporation. And if that’s true, the corporation could not be held vicariously liable for any of his conduct. When it comes to accepting emoluments the actions are more likely to be taken by Trump’s sons or other corporate officials – but the Emoluments Clause does not apply to them.

In short, I’m not confident that trying to hold the Trump Organization vicariously liable for Trump’s own constitutional violations will work. But all this got me thinking about whether there might be other legal theories under which a state attorney general could argue that Trump-owned companies act unlawfully when they receive emoluments. And that led me to a core white collar criminal statute: conspiracy to defraud the United States.

Image of the US Constitution - the Emoluments Clause is contained in Article I

The Emoluments Clause and Conspiracy to Defraud the United States

The federal conspiracy statute, 18 U.S.C. § 371, prohibits two types of conspiracies: conspiracy to commit an offense against the United States and conspiracy “to defraud the United States, or any agency thereof in any manner or for any purpose.” A conspiracy requires that two or more people knowingly enter into an agreement to achieve an unlawful purpose and that at least one of them takes some action in furtherance of that agreement.

Conspiracy to commit an offense against the U.S. usually means conspiracy to commit a federal crime – conspiracy to commit securities fraud or conspiracy to obstruct justice, for example. But the second prong of the statute, conspiracy to defraud the U.S. “in any manner or for any purpose,” has a broader reach.

To defraud someone usually means to deprive him of money or property. But conspiracy to defraud the United States under section 371 also includes any conspiracy to impair, obstruct or impede the lawful functions of the U.S. government. In Hammerschmidt v. United States in 1924, the Supreme Court held that conspiracy to defraud the U.S.  includes schemes “to interfere with or obstruct one of its lawful government functions by deceit, craft, or trickery, or at least by means that are dishonest.”

The statute applies to schemes such as disguising transactions to evade some government regulatory program, or hiding assets to thwart the IRS. Individuals can commit the offense even if their underlying conduct, standing alone, would not be illegal. The scheme need not result in any financial harm to the government.

Another important aspect of conspiracy law is that not all co-conspirators need to be capable of committing the underlying offense that is the object of a conspiracy. For example, just last spring the Supreme Court held in Ocasio v. United States that private citizens could be convicted of conspiracy to commit extortion under color of official right. Because they were not public officials, they could not be convicted of the extortion offense themselves. But the Court held they were still capable of agreeing to help a public official commit extortion, and thus could be found guilty of conspiracy.

So with the Emoluments Clause the argument would go like this: the Clause is part of a constitutional structure set up to ensure that officers of the United States are free from outside influences and conflicts of interest. The members of the Trump Organization and foreign government agents who provide benefits to that Organization (and thus indirectly to Trump himself) are impairing, obstructing, and impeding that government function by facilitating the acceptance of improper emoluments by the President. This constitutes a conspiracy to defraud the United States under section 371.

Although corporate officers and foreign agents could not violate the Emoluments Clause themselves, they may conspire to help President Trump violate it. And although their actions may not violate any other law, that doesn’t matter. Those actions may still constitute a conspiracy to defraud the United States by interfering with its proper operations.

This would be analogous to cases involving bribery. Laws against bribery are similar to the Emoluments Clause in that both seek to prevent government officials from being swayed by improper outside influences. Prosecutors have charged schemes to bribe federal officials as conspiracies to defraud the United States. Bribery corrupts the political system and thereby impairs the lawful government functions of the United States. The same is true of violations of the Emoluments Clause.

Image of the Bank of China building. China is one potential source of improper emoluments to President Trump.

Details of a Potential Conspiracy

There are a number of possible co-conspirators in any such case. If we take the China trademark example, co-conspirators could potentially include Chinese officials involved. They could also include any officials within the Trump Organization who took part in the transaction. The Trump Organization itself would be vicariously liable through the acts of those officials. A state attorney general would even have the option of listing the President himself as a co-conspirator. By refusing to divest and by allowing his businesses to accept foreign emoluments, he arguably has joined the agreement.

A conspiracy to defraud must involve some kind of deception or dishonesty. There are a number of possibilities here. Assuming the discussions that led up to something like the China trademark deal are not publicly disclosed, for example, that concealment furthers the scheme to defraud. Other deceptions are likely involved in other potential Emoluments Clause violations. One could even argue that the President’s failure to disclose his tax returns is a part of the deception. By concealing the full scope of his financial holdings and potential conflicts, it helps the conspiracy to succeed.

Of course, it’s not realistic to expect Donald Trump’s own Department of Justice to file a criminal case charging members of the Trump Organization with conspiracy. But that’s not necessary. Building on Prof. Shugerman’s argument, a more promising option is to use conspiracy as a basis to allege fraudulent or illegal corporate behavior in a quo warranto proceeding.

This theory avoids many of the potential quo warranto hurdles discussed above. The unlawful conduct is not the violation of the Emoluments Clause but engaging in a conspiracy to defraud the United States by impeding its legitimate operations. There’s no question that a private corporation is capable of committing that offense. The New York statute quoted above requires that the corporation have engaged in fraudulent or illegal conduct. Participating in a conspiracy to defraud the U.S. fits the bill perfectly.

In a civil proceeding, of course, the plaintiff only needs to prove the conspiracy by a preponderance of the evidence, a much lower bar than the proof beyond a reasonable doubt required in a criminal prosecution. And civil discovery in such a proceeding could lead to disclosure of a great deal of relevant information, including Trump’s tax returns.

Like so much involving the Emoluments Clause, this theory is novel and untested. But given the purpose of the Clause, the breadth of the conspiracy statute’s ban on conspiracies to defraud the U.S. “in any manner or for any purpose,” and the use of a similar theory in bribery cases, I think it’s a compelling argument. A state attorney general or other litigant contemplating a quo warranto proceeding should consider throwing this conspiracy argument into the mix.

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Judge Gorsuch, White Collar Crime, and the Legacy of Justice Scalia

The confirmation battle over Neil Gorsuch, President Trump’s pick to fill the vacant seat on the U.S. Supreme Court, promises to be ugly. All aspects of his record will be thoroughly dissected — and likely distorted — by both political parties. Looming over the proceeding is Democratic anger over the Merrick Garland nomination and the threat of Republican Senators to invoke the “nuclear option” to break any Democratic filibuster. It’s destined to be one of those political knife fights that reminds everyone why they hate Washington.

Partisans on both sides will be trying to predict how a Justice Gorsuch might rule on any number of hot-button issues. But here at Sidebars we are particularly interested in how Gorsuch’s presence on the Supreme Court might influence the law of white collar crime. So I spent some time this week reading opinions written by Judge Gorsuch on the 10th Circuit Court of Appeals in cases involving white collar offenses such as mail and wire fraud, public corruption, obstruction of justice and money laundering, to see if I could glean anything from those decisions.

I didn’t find anything particularly remarkable. Most of the white collar cases where Judge Gorsuch wrote the opinion for a three-judge panel ruled in favor of the government, but that’s true of most criminal appeals. Most of the decisions were unanimous. That’s also not unusual, but at least it suggests a judge who generally colors within the lines of established precedent and is not a bomb-thrower writing dissents advocating extreme positions.

One thing I definitely learned is that Judge Gorsuch is indeed a terrific writer, as many others have noted. His opinions are clear, concise, and free of legal jargon. They are a pleasure to read, which is saying something when it comes to judicial opinions. In that regard he reminds me of Justice Kagan, in my view currently the best writer on the Court. That’s something I really admire — although I guess if you fear a Justice Gorsuch is going to gut your fundamental liberties it’s cold comfort to know he’ll do it with great style and clarity.

In any event, it appears unlikely that any of Judge Gorsuch’s opinions in white collar cases will be particularly controversial or a focus of his confirmation hearing. But that doesn’t mean there is nothing we can learn about how Justice Gorsuch might approach such cases at the high court.

Those who have studied or worked with Judge Gorsuch and know him best describe him as a judge in the mold of Antonin Scalia, the Justice whose seat he would assume. The opinions and other materials I reviewed certainly support that characterization. And if Justice Gorsuch does follow in the footsteps of Justice Scalia when it comes to criminal law, it could lead to some interesting and potentially surprising results.

Antonin_Scalia_Official_SCOTUS_Portrait

Justice Scalia’s White Collar Legacy

When it comes to Justice Scalia and criminal law, it’s complicated. Although conservative, he was definitely not a “hanging judge” ruling against criminal defendants at every opportunity. On the contrary, Scalia’s strict approach to statutory and constitutional interpretation often resulted in decisions that favored criminal defendants – and often led him to side with some of the most liberal members of the Court.

In constitutional law, Justice Scalia’s originalist approach made him suspicious of expansive notions of government power and protective of the rights of criminal defendants embodied in the text of the Constitution. In areas such as the right of defendants to confront witnesses against them (for example, Crawford v. Washington), the right to a jury trial (Blakely v. Washington), and the right to be free from unreasonable searches and seizures (Florida v. Jardines and Kyllo v. United States, for example), Scalia was a powerful voice warning against government encroachment on these fundamental constitutional liberties. On the other hand, when it came to doctrines he considered judicial inventions not found in the text of the Constitution – such as the exclusionary rule and right to Miranda warnings – he was much less sympathetic.

White collar cases more often involve the interpretation of statutes, not the Constitution. And white collar statutes are notorious for being broad and somewhat vague, using sometimes fuzzy terms such as “fraud” that are not otherwise defined. Justice Scalia authored a number of significant white collar opinions and dissents. His strict textualist approach generally led him to read white collar statutes narrowly. He was skeptical of prosecutors’ attempts to fashion expansive theories of criminal liability not directly spelled out in the statutes. Some Justices are much more willing to hold that courts should flesh out the parameters of broadly-worded criminal laws; Scalia insisted that crimes had to be specifically defined by Congress, not by judges.

For example, Justice Scalia was a long-time critic of a popular species of mail and wire fraud known as honest services fraud. Frequently used in prosecution of state and local corruption, it charges that victims were defrauded not of money or property but of their intangible right to the honest services of a politician or other individual who owed them a duty. Justice Scalia maintained throughout his career that the idea of “honest services” was too amorphous to support criminal liability and failed to provide adequate notice about what conduct was prohibited.

In Skilling v. United States in 2010 the Court responded to vagueness concerns by narrowing honest services fraud liability to cases involving bribes and kickbacks. Justice Scalia wrote a separate opinion arguing that the Court should go further and declare the honest services fraud statute unconstitutionally vague in all circumstances. (He even referred to it as “so-called honest services fraud,” a locution that President Trump might appreciate.)

In another leading mail fraud case, Schmuck v. United States (yes, that’s the real name), the issue was whether the mailings proved by the prosecution actually furthered the scheme to defraud as required by the statute. The majority adopted a broad reading of the “in furtherance” requirement and upheld the convictions. Justice Scalia dissented, criticizing the prosecution for what he deemed an overly-expansive view of the mail fraud statute. His opinion arguing that the defendant’s convictions should be reversed was joined by Justices Brennan and Marshall, two of the most liberal Justices of the 20th century.

Justice Scalia similarly favored a narrow reading of a public corruption theory called extortion under color of official right under the Hobbs Act. In 1992 in Evans v. United States, the majority held that extortion under color of official right was basically equivalent to bribery. Justice Scalia joined a dissent by Justice Thomas arguing that bribery and extortion are distinct crimes and that the majority opinion wrongfully resulted in a vast expansion of federal criminal law and the power of federal prosecutors.

Of course, strict interpretation of the statute sometimes meant the defendant lost. For example, Brogan v. United States involved the false statements statute that criminalizes lying to the government about material matters. Lower courts had created an exception to the statute, known as the “exculpatory no,” holding that prosecution could not be based on a defendant’s mere denial of guilt. Justice Scalia wrote the majority opinion holding the text of the statute contains no such exception and stating “[c]ourts may not create their own limitations on legislation, no matter how alluring the policy arguments for doing so . . . .” (He also noted the defendant’s concession that “under a ‘literal reading’ of the statute he loses.” If you had made that concession and then saw that Justice Scalia was writing the opinion in your case, you knew it was not going to be a good day.)

Recently in Yates v. United States the defendant was charged with obstruction of justice, a twenty-year felony, for throwing overboard some undersized fish that were evidence he had violated fishing regulations. During oral argument Justice Scalia expressed outrage that the government had brought such a case. But in the end he refused to join the five-Justice majority reversing the conviction on the questionable ground that fish were not “tangible objects” within the meaning of the law. Instead he joined with Justice Kagan in dissent, arguing that the plain wording of the statute compelled a ruling in favor of the government. He clearly thought the prosecution was misguided, but did not believe the solution was for the Court to adopt a strained interpretation of the statute that was contrary to its plain language.

gorsuch

Judge Gorsuch and White Collar Crime

Would Justice Gorsuch channel Justice Scalia when it comes to white collar crime? It’s always a bit dicey trying to predict how a judge would behave on the Supreme Court based on his appellate opinions. Appellate judges, of course, are bound by Supreme Court precedent, so they generally don’t have the same freedom and opportunities to decide novel legal questions. But there is reason to believe Justice Gorsuch’s approach would indeed look a lot like Justice Scalia’s.

Judge Gorsuch shares Justice Scalia’s belief in strict construction of the Constitution according to the intent of its framers. In a widely-quoted concurrence in Cordova v. City of Albuquerque, he wrote:

Ours is the job of interpreting the Constitution. And that document isn’t some inkblot on which litigants may project their hopes and dreams . . .  but a carefully drafted text judges are charged with applying according to its original public meaning.

Judge Gorsuch also appears to share the concerns of Justice Scalia about overcriminalization and sweeping criminal statutes that may place too much power in the hands of prosecutors. In a law review article in 2010 Judge Gorsuch wrote: “What happens to individual freedom and equality—and to our very conception of law itself—when the criminal code comes to cover so many facets of daily life that prosecutors can almost choose their targets with impunity?”

Judge Gorsuch’s strict textualist approach to statutory interpretation has occasionally led him, as it did Justice Scalia, to rulings that narrowly interpret criminal statutes and favor criminal defendants. One example involves a statute that makes it a crime for an individual with a felony conviction to possess a firearm, 18 U.S.C. § 922(g)(1). The 10th Circuit has agreed with the majority of courts of appeal that the government in such a case needs to prove only that the defendant knew he possessed a gun and does not need to prove the defendant knew he had a felony conviction.

Judge Gorsuch disagrees. In a classic Scalia-esque statutory interpretation argument, he has argued that the plain language of the statute requires the government to prove both – an interpretation that, if adopted, would favor defendants and place a heavier burden on the government. In one of the cases, United States v. Games-Perez, notice Judge Gorsuch’s language in his concurrence expressing disagreement with his colleagues:

Our duty to follow precedent sometimes requires us to make mistakes. Unfortunately, this is that sort of case. . . .

I recognize that precedent compels me to join the court’s judgment. But candor also compels me to suggest that we might be better off applying the law Congress wrote than the one [the court’s earlier decision] hypothesized. It is a perfectly clear law as it is written, plain in its terms, straightforward in its application. Of course, if Congress wishes to revise the plain terms of [the statute] it is free to do so anytime. But there is simply no right or reason for this court to be in that business.

Those final two sentences could have been lifted straight out of a Justice Scalia opinion: the statute says what it says, and if there’s a problem it is up to Congress to fix it, not the court.

But what a marked contrast to the writing style of Justice Scalia, who was famous for disagreeing with his colleagues in the most sarcastic and acerbic terms. In addition to being a gifted writer, Judge Gorsuch displays much more of a traditional judicial temperament than the man he would replace.

Later, dissenting from a denial of a rehearing en banc in the same case, Judge Gorsuch wrote a impassioned defense of the right of criminal defendants to be convicted only if the government proves every element of the offense: “There can be few graver injustices in a society governed by the rule of law than imprisoning a man without requiring proof of his guilt under the written laws of the land.”

Another 10th Circuit case, United States v. Makkar, involved a prosecution under the analogous drug act, which criminalizes selling substances that mimic a listed controlled substance. In another pro-defendant decision, Judge Gorsuch reversed the convictions and held that the plain language of the statute requires the government to prove the analogous substance had the same chemical structure as the controlled substance, not merely that it had the same effects on the user.

In addition to strictly interpreting criminal statutes, Judge Gorsuch, like Justice Scalia, has a history of holding prosecutors’ feet to the fire and insisting they play by the rules. For example, in United States v. Farr, a tax fraud case, Judge Gorsuch ruled in favor of the defendant and held that prosecutors had improperly convicted him under a theory of tax fraud different from the one that was charged in the indictment.

In a case that might be of interest in the current political environment, Judge Gorsuch also wrote the opinion in United States v. Hasan, reversing the perjury conviction of a Somali refugee. He ruled the trial court had erred by finding the defendant was not entitled to an interpreter when testifying in the grand jury. This was under the extremely deferential “plain error” standard of review, and it would have been easy for an appellate judge simply to defer to the judgment of the trial court. If opponents try to portray Judge Gorsuch as a cold-hearted conservative who cares nothing about the most vulnerable among us, we might see this opinion trotted out in response.

Overall, Judge Gorsuch’s opinions related to criminal law are largely uncontroversial and closely adhere to governing precedent. He definitely takes a strict approach to the interpretation of texts. He does not appear to be results-oriented and will not hesitate to rule against the government and in favor of a criminal defendant if he believes that is required. His approach to criminal law in general and white collar crime in particular does seem to be very similar to Justice Scalia’s.

At least as far as criminal law is concerned, Democrats thinking about opposing his nomination should probably consider they could do a lot worse.

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Selling Access: President Trump, Corruption, and the Legacy of Bob McDonnell

President Donald Trump took office last week amid a storm of controversy over ethics and potential conflicts of interest. There are widespread concerns about possible corruption in the Trump administration. A key focus has been the Emoluments Clause of the Constitution, which forbids federal officials to accept any payments or gifts from foreign governments. Trump’s extensive international business holdings appear to make violations of that clause almost inevitable. (I wrote last November about the Emoluments Clause and how it relates to bribery; you can find that post here.)

Trump recently did announce some steps to transfer control of his businesses to his sons, although it is unclear to what extent that has actually taken place. The head of the U.S. Office of Government Ethics, Walter Shaub, pronounced these efforts wholly inadequate  – and promptly found himself summoned to Capitol Hill to explain his temerity to a Congressional committee. Then this past Monday a public watchdog group and several prominent law professors filed a lawsuit asking a federal court to rule that the new president is already violating the Emoluments Clause.

But the Emoluments Clause is only one of the conflict of interest issues surrounding President Trump. A related ethical concern is the potential for access to the President and his administration to be used as a bargaining chip in his private business dealings. Businesses or governments could secretly agree to provide benefits to Trump-owned businesses in exchange for a private audience with the President or other Executive Branch officials, where they could lobby for government actions that would benefit them. The breadth of the President’s business holdings — and his refusal to divest himself of those holdings – creates an unprecedented risk of such conflicts.

Trump and his family have already demonstrated what might charitably be called a lack of sensitivity to the ethical issues that surround selling access to the White House. In December a nonprofit where Trump’s sons were registered as directors promoted an inaugural event called “Opening Day,” supposedly to benefit unnamed charities related to conservation. It offered donors of $1 million attendance at a private reception with the President-elect, as well as a four-day hunting or fishing excursion with one of his sons. In another incident, a charitable group ran an on-line auction of an opportunity to have coffee with Trump’s daughter Ivanka. The bidding was above $70,000 before the effort was shut down following media inquiries.

Even though the money from such events may go to charity, the buyer’s motives are not necessarily charitable. For example, the high bidder in the auction for coffee with Ms. Trump told the New York Times that he wanted to urge her to persuade her father not to go too far in restricting immigration. Another bidder hoped to speak to her about the Trump administration’s relationship with the Turkish government.

These efforts to sell access to the President and his family raised ethical red flags for a simple reason: access is valuable. Time on any senior government official’s schedule is a scarce commodity. Those able to meet personally with that official (or his family) have an advantage generally unavailable to ordinary citizens: the ability to directly and privately advocate for their own interests. Attempts to cash in on access to government officials – even for charitable causes – are deemed inappropriate because time with those who are supposed to serve all citizens should not be auctioned off to the highest bidder.

But public charity sales of access are just the tip of the potential ethics iceberg. Of far greater concern are transactions that could take place entirely out of public view. For example, imagine this hypothetical: a foreign company is negotiating some kind of deal with a Trump organization business. The company’s officers make it known that they will offer a sweetheart deal at substantial savings if, in exchange, Trump sets up a meeting for them with the Secretary of Commerce to discuss removing certain import restrictions that apply to the company’s products. (Note that because this hypo involves a private company, not a foreign government, the Emoluments Clause would not apply.)

Trump agrees and the deal goes through. Because it involves two private companies, it is not publicly disclosed. Trump then calls the Secretary of Commerce and says, “These guys are friends of mine, I’d like you to meet with them and hear what they have to say about these import sanctions.” Trump doesn’t tell the Secretary about the art of his deal with the company. He also doesn’t tell the Secretary how to decide the question, but the Secretary is no dummy and can read between the lines to see what would please the boss. The meeting happens, the import restrictions are lifted, both sides are happy, and the country is none the wiser.

Remarkable as it may seem, if such a scheme took place it would not violate federal bribery law. And for that, President Trump can thank the former Governor of Virginia – and the U.S. Supreme Court.

Image of Bob McDonnell, former governor of Virginia, whose case paved the way for corruption in the Trump administration

Access for Sale: McDonnell v. United States

Regular readers know that I’ve written a number of posts about McDonnellhere, here, and here, for example – that provide more details about the case. In brief, former Virginia Governor Robert McDonnell and his wife Maureen were prosecuted for essentially selling access to Virginia government officials. Businessman Jonnie Williams was interested in having Virginia universities conduct research on his company’s dietary supplement Anatabloc. Over a two-year period he gave the McDonnells a variety of personal gifts and loans worth more than $170,000.

In exchange, the McDonnells agreed to help promote Anatabloc within the Virginia government. Governor McDonnell arranged meetings for Williams with various government health officials and researchers so Williams could make his pitch. He also held a product launch event for Anatabloc at the Governor’s mansion, attended by state health officials and other government employees.

The McDonnells were found guilty of multiple counts of corruption following a jury trial, and the Fourth Circuit Court of Appeals unanimously upheld their convictions. But last June the U.S. Supreme Court unanimously reversed, holding that the actions taken by McDonnell on Williams’ behalf were too inconsequential to support a bribery conviction.

The Supreme Court held that simply arranging a meeting, making a phone call, or holding an event did not constitute an “official act” under federal bribery law. An official act, the Court said, requires the public official to take some more substantive steps to resolve a particular question or matter that may be pending before the government, or to pressure another official to do so. Preliminary actions or political courtesies such as arranging a meeting, the Court held, do not rise to that level.

After McDonnell, merely arranging access to government officials may not form the basis of a corruption conviction, even in extreme circumstances. For example, a governor could establish a policy whereby anyone who wanted to meet with a member of his administration had to pay the governor $10,000 to arrange the meeting. Similarly, a company could offer millions of dollars in secret benefits or concessions to a Trump business in exchange for a private dinner with the President or meeting with a Cabinet official. Neither arrangement would violate federal bribery law.

Bribery laws aim to prevent government officials from using their public office to enrich themselves by offering favorable treatment to those willing to pay. Determining whether such a corrupt arrangement exists requires looking at the entire agreement – the quid, the pro, and the quo – and not just focusing on a single side of the equation. The McDonnell decision, through its myopic focus on the meaning of “official act,” effectively took off the table an entire area of public corruption law: the sale of access to government officials.

Image of a bribe taking place - bribery is a key corruption offense

Not All Access is Created Equal

Those familiar with the ways of Washington may observe that access is always up for sale to some extent. It’s just a reality of politics. Large campaign or PAC donors are regularly treated to private events with public officials. For example, large donors to the Presidential Inaugural last week were rewarded with access in the form of a candlelight dinner with Trump and Vice-President Pence at Washington’s Union Station.

This is part of what motivated the Supreme Court in McDonnell. The Court was concerned that if providing access could support a bribery conviction, then many routine interactions with supporters and political courtesies might end up being prosecuted. But again, this mistakenly focuses only on one side of the equation. It’s true that arranging a meeting may be an innocent political courtesy, just as voting on a bill may be a routine political act. But if either is done in direct exchange for a corrupt, secret gift that enriches the politician, that is neither innocent nor routine.

In deciding whether a sale of access might be corrupt, one should consider the whole picture. For example, donations to campaigns take place within a legal framework that generally involves at least some public disclosure and contribution limits. The public is able to see who is supporting the official and to what extent, and to judge the official’s actions accordingly. Sunlight is the best antidote for corruption.

Our current campaign finance system, whatever its flaws, is legal. Contributions made within the framework of that system come with almost a presumption of regularity, and are on a completely different footing from secret, undisclosed gifts. Access may be provided after such contributions, but proving corrupt intent in a case involving lawful contributions will be extremely difficult.

Another distinction is the type of access provided. There’s a big difference between attending a dinner or reception with a few hundred other donors (even by candlelight) and a one-on-one private meeting with an official. The former is more likely to be just a social event where the donors enjoy simply being in the presence of power and perhaps get a chance for a selfie; that is not a setting conducive to corrupt, secret deals.

But the most crucial factor on the quid side of the analysis can be summed up in the immortal words of Watergate’s Deep Throat: follow the money. Campaign contributions go to the campaign, a separate legal entity, as do donations for things such as PACs or Inaugural events. The public official is benefitting indirectly, to be sure, but the support is directed more at the office and campaign and not to line the official’s own pockets.

Contrast this with what Jonnie Williams gave to the McDonnells – secret gifts that enriched the family personally. These were not campaign contributions or other legitimate donations. Rolex watches, New York shopping sprees, and sweetheart loans do not show up on campaign finance reports, are not subject to any legal limits, and personally enrich the official. Unlike routine campaign or PAC contributions, secret gifts to a politician have no legitimate or legally recognized purpose and automatically have the whiff of corruption about them.

The point of all this is simply that it should not be enough to say, “Well, all he did was arrange a meeting, so there can be no corruption.” All of the circumstances surrounding any alleged deal have to be examined. The secret sale of access to public officials causes the exact harm that laws against bribery are intended to prevent: politicians enriching themselves by handing out favors only to those willing to pay. Unfortunately, the McDonnell decision has created a safe harbor for just that kind of corruption.

The Need for Divestiture

Some might suggest this is not a serious problem because there are other potential controls besides the criminal law. For example, the attempts to sell access for charitable causes that I mentioned at the top of this article were exposed and then cancelled. Perhaps the voters and the media can police any such misconduct and shame officials into proper behavior. Ultimately, unhappy voters can always express their displeasure at the ballot box.

But the problem with relying on public pressure and media scrutiny to police such actions is that it assumes full access to information. Most corruption takes place in secret. Although the charitable fundraising efforts were necessarily public, backdoor deals are not. Corruption and conflicts of interest can be very difficult to detect. This is why divestiture of assets that pose a potential conflict is so important: it removes even the possibility of using the power of one’s office to profit off of those assets.

The scenarios outlined here are hypothetical, of course. But the potential for this President to enrich himself and his family through the power of his office is truly extraordinary. With a green light from the Supreme Court, Trump and his family are free to use access to Washington power as a bargaining chip in his private business dealings, taking comfort in the fact that even if their actions come to light, they will not be unlawful.

Yet another way in which the Trump presidency is unprecedented.

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Update: California Appeals Court Overturns Ban on Use of Grand Juries in Police Deadly Force Cases

In a post last year on grand jury secrecy, I wrote about how the state of California had banned the use of grand jury proceedings in cases involving the use of deadly force by police officers. The California state constitution provides that all felony cases shall be prosecuted by either grand jury indictment or by an information following a probable cause hearing before a magistrate. Which method to use is generally left up to the district attorney.

But in the wake of several controversial cases nationwide involving police use of deadly force, California legislators concluded that the secrecy of grand jury proceedings contributed to an atmosphere of suspicion surrounding such cases. They argued that the outcomes of grand jury investigations “can seem unfair or inexplicable” because the secret proceedings lack “transparency and accountability.” They concluded that, due to the intense public interest in and concern about cases involving the police, more openness was necessary. Accordingly, they amended the California Penal Code to prohibit the use of a grand jury to investigate any case involving the use of deadly force by a law enforcement officer. As a result, such cases could be charged only via a public hearing before a magistrate.

In that earlier post, I argued that this legislation was misguided and would likely make it more difficult to conduct fair investigations of cases involving police officers. As the California legislature noted, such cases often involve intense public scrutiny and interest. Whether they support the prosecution or the defense, witnesses in those cases may face tremendous public pressure related to their testimony. Grand jury secrecy allows the witnesses in such high-profile investigations to testify truthfully without fear of becoming the target of a vitriolic social media campaign or finding protestors on their front lawn. The grand jury proceeding provides a confidential forum where representatives of the community — the grand jurors themselves — can explore what happened largely free from the political pressure and social passions that may surround these cases.

The California legislation took effect on January 1, 2016 and was immediately challenged by a group of district attorneys led by Vern Pierson, the DA for El Dorado County. They argued that the law was unconstitutional and inhibited their ability to do their jobs effectively. This week a California Court of Appeals ruled in their favor and held that the legislation violated the California constitution.

The court noted that the law was the “first legislative effort in 167 years to constrict the grand jury’s power under the Constitution to exercise its power of indictment.” The state constitution provides for the potential use of the grand jury in all felonies, and the legislature was not free simply to disregard this mandate for a particular category of cases. If the legislature had that power, the court reasoned, the logical implication would be that it could abolish grand juries altogether, which would plainly conflict with the constitutional mandate.

The court noted that if the legislature wanted to restrict the use of grand juries, it was not powerless. It could pursue a constitutional amendment to alter the current language providing for the option of a grand jury investigation in all felony cases. It could also follow the “less cumbersome route” of modifying the rules of grand jury secrecy, which are not constitutionally mandated, to provide for more openness and public disclosure in grand jury investigations. But given the constitutional language, the legislature was not free simply to ban the use of grand jury proceedings altogether for a particular class of cases.

This is a good result for the people of California. As the prosecutors who challenged the law recognized, they are more likely to achieve a just result in police investigations if they are able to utilize the grand jury and the safeguards that it provides. The irony of the California legislation was always that it potentially sacrificed justice on the altar of transparency.

The opinion is narrow; it focuses only on the fact that the legislation was inconsistent with the state constitution. The court does not discuss the benefits of secret grand jury proceedings, particularly in high-profile cases, and why the legislation may have been a bad idea. That’s understandable, but unfortunate. It would have been nice to see a judicial recognition and discussion of how grand jury proceedings can best serve the interests of justice by providing a dispassionate forum to investigate controversial cases.

The concern now has to be that the legislature will follow the court’s suggestion and pass a law to limit or abrogate grand jury secrecy in police cases, or perhaps in all cases. But secrecy is a fundamental characteristic of grand jury proceedings and provides a number of important benefits. Hopefully cooler heads will prevail and the legislature will recognize that the solution to concerns about the police and use of deadly force is not to start tinkering with the essential nature of the ancient institution of the grand jury.

The case is The People ex rel. Vern Pierson v. The Superior Court of El Dorado County, CA Court of Appeal, Third Appellate District, No. C081603 (Jan. 10, 2017). (Click here to download the opinion.) Hat tip to Patrick O’Toole, a district attorney in California, who was involved in the case from the beginning, co-argued it in the California Appeals Court, and kept me updated on its progress.

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Misguided Prosecutions and Washington “Gaffes”

There’s a well-known saying in Washington that the definition of a “gaffe” is when a politician inadvertently tells the truth. Assistant Attorney General Leslie R. Caldwell is not a politician, but she had her own “Washington gaffe” moment earlier this month while speaking on a panel sponsored by the Federalist Society (YouTube video available here).

Caldwell, who serves (for a few more weeks, at least) as the head of the Criminal Division at the U.S. Department of Justice, appeared on the panel with four white collar defense attorneys on December 8 at the Washington Press Club. The topic was overcriminalization – not as in too many criminal statutes being on the books, but overcriminalization in the form of federal prosecutors bringing cases that never should have been pursued as criminal matters.

The defense attorneys on the panel had represented corporate and individual defendants in recent major cases involving FedEx, a medical device company called Vascular Solutions, and pharmaceutical company Warner Chilcott. Those cases ended either in acquittals or, in the case of Fed Ex, with the government dismissing the case mid-trial. Each defense attorney told a version of the same basic story: the prosecution was an outrageous miscarriage of justice, criminal charges never should have been filed or even considered, and no one within the relevant prosecutor’s office had been willing to give the defense a fair hearing about why the case should not be indicted.

When AAG Caldwell took the podium as the final speaker, she appeared to throw her colleagues in the U.S. Attorneys’ Offices under the proverbial bus. She went out of her way to distinguish the Criminal Division at Main Justice in DC from the ninety-four U.S. Attorney’s Offices around the country. She said that while the attorneys in the Criminal Division operate with professionalism and integrity, she has seen “wide variation around the country” in the U.S. Attorney’s Offices in terms of their level of experience and quality of supervision.

Although not commenting on the specific cases discussed by the other panelists, AAG Caldwell agreed that sometimes cases get filed that should not have been filed; “I’m not going to dispute that.” She discussed a couple of additional examples where U.S. Attorney’s Offices had proposed misguided prosecutions. In one instance, prosecutors wanted to indict two partners at a law firm for obstruction of justice for seeking additional time to respond to a grand jury subpoena; in another, prosecutors proposed to charge all the adult residents of a small town in a RICO conspiracy. Because RICO cases and indictments of attorneys — unlike most cases — require review by Main Justice, those cases were able to be quashed by the Criminal Division.

Finally, Caldwell encouraged defense lawyers who believe prosecutors are pursuing inappropriate cases to seek review by Main Justice if they cannot get their concerns addressed. She said the Criminal Division recognizes that “not all U.S. Attorney’s Offices are created equal,” and that defense attorneys should not hesitate to go over the U.S. Attorney’s head and appeal to Washington in appropriate cases.

Caldwell’s suggestion that prosecutors in the U.S. Attorney’s Offices around the country do not always measure up to those in her own Criminal Division apparently did not sit well with her Justice Department colleagues. Two days later she issued a letter of apology to all DOJ attorneys. She wrote that while speaking at the panel she had defended the Department “in a way that inappropriately suggested that the care taken by U.S. Attorney’s Offices and others in making prosecutorial decisions was less than that taken by attorneys in the Criminal Division.” She said she deeply regretted the remarks, which she called “a mistake.”

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Caldwell’s Comments: Mistake or D.C. Gaffe?

For AAG Caldwell to make her points in that particular forum and format may indeed have been a mistake – but was she wrong?

Before considering that, a couple of observations about the panel discussion. First, the Federalist Society’s agenda was pretty transparent, and the ratio of four defense attorneys to one prosecutor was not exactly an attempt to be “fair and balanced.” The defense attorneys were naturally presenting the details of their cases from their own perspective. They did prevail, so no doubt their claims have some merit. But there are always two sides to such stories, and I think it would be surprising if the facts were indeed so black and white. The panel would have been more interesting if prosecutors in some of those cases could have been persuaded to participate and explain why they believed the case was justified.

Second, as one of the panelists pointed out, there are between eighty and ninety thousand criminal defendants prosecuted each year by the Department of Justice and all but a relative handful end up with either a guilty plea or a conviction at trial. So while talking about a few high-profile cases where the defense prevailed is interesting and worthwhile, it would be wrong to conclude that those cases represent anything close to the norm. As they say in journalism, no one writes stories about all the planes that don’t crash. Examples where the prosecution’s case falls apart are interesting and newsworthy in part because they are so unusual.

But back to AAG Caldwell’s comments. It really shouldn’t be controversial to admit that occasionally cases get filed that should not be filed. Law is a human enterprise and thus inherently flawed. There are thousands of prosecutors working for the Department of Justice across the country on tens of thousands of case each year. People sometimes are going to screw up.

It also should be relatively uncontroversial to observe that the U.S. Attorney’s offices vary in terms of their levels of experience and quality. Those offices operate with a great deal of autonomy, and are staffed by individuals with varying backgrounds and experiences from different parts of the country with different legal communities and traditions. Obviously some offices are going to be better run and more experienced than others.

With relatively few exceptions, AUSAs are free to investigate and indict their cases with no oversight from D.C. I don’t know whether the average line attorney in the Criminal Division in Washington is smarter than the average AUSA around the country, but I do know the attorney in Washington is going to have his or her cases supervised and reviewed by veteran prosecutors who have seen many similar cases and issues in the past. That level of seasoned review and quality control is not always available within every U.S. Attorney’s Office, where they may not see nearly as many large or complex cases.

It’s not fair to suggest that Main Justice itself is immune from making mistakes or bringing bad cases, but I think it’s perfectly fair to suggest that such cases are more likely to originate in the U.S. Attorney’s offices.

So although I’m sure she wishes she had phrased them differently, I think AAG Caldwell’s comments were basically correct. And they highlight an issue I think DOJ needs to take seriously: a need for renewed focus and training nationwide on the sound exercise of prosecutorial discretion.

Emphasizing the “Discretion” in Prosecutorial Discretion

There have been a number of high-profile examples recently of cases that appear to have involved bad charging decisions. If the government loses, as in the cases discussed during the Federalist Society panel, that is generally the end of it — other than providing great war stories for defense counsel. But when the defendant in such a case is convicted, the government is faced with defending its charging decisions on appeal. As I wrote in this recent post, that has led the U.S. Supreme Court recently to question whether prosecutors can be trusted to exercise their discretion appropriately.

For example, in Bond v. United States a woman who was angry at her husband’s lover sprinkled a caustic chemical on her doorknob and mailbox, which caused a minor skin irritation easily treated with cold water. Federal prosecutors responded by charging Bond with a felony aimed at punishing the use of chemical weapons. In Yates v. United States, a commercial fisherman received a civil citation for catching several dozen undersized red grouper and was ordered to take the fish back to port to be seized by authorities. When instead he threw the fish overboard, he was indicted for obstruction of justice under a statute that carries a maximum twenty-year penalty. Both these cases made it to the Supreme Court, and in both cases the Court expressed incredulity that prosecutors had chosen to bring the charges.

Cases where inappropriate charges are filed do not cast the Department of Justice in a favorable light. For the individual defendants, of course, they can result in tremendous injustice, which is contrary to DOJ’s fundamental mission. And if courts lose faith in the judgment and charging decisions of prosecutors, they will try to find ways to rein the government in – even if, as in Yates, that means adopting an interpretation of a statute that seems contrary to its plain language and common sense. This can make it more difficult for all prosecutors to do their jobs.

Members of the Federalist Society panel also talked about prosecutor myopia, where prosecutors could only see the facts a certain way and remained convinced, up to the end, that their cause was righteous. I think this is a real phenomenon; those who are trained in criminal prosecution may tend to see criminal remedies as the best option. As the saying goes, when your only tool is a hammer, every problem looks like a nail. But particularly when it comes to white collar crime and regulatory offenses, it’s critical for prosecutors to recognize there are many possible alternative remedies and that criminal prosecution may not be the best solution.

Cases like Yates, Bond, and those discussed at the Federalist Society panel, along with AAG Caldwell’s observations about the varying levels of experience within the U.S. Attorney’s Offices, suggest that DOJ could benefit from a renewed emphasis on the proper exercise of prosecutorial discretion. Washington may not be able to review all proposed indictments, but Main Justice could ensure that all prosecutors around the country are thoroughly trained in the “discretion” aspect of their jobs.

Prosecutors need to know the criminal law, of course, but they also need to have hammered into them, from day one, that deciding when not to apply criminal law is a huge part of their jobs. All prosecutors know this on some level, but there’s a difference between knowing it and having it ingrained and repeatedly stressed as a part of your professional identity and institutional culture. If there is too much emphasis on indictment numbers and “stats,” prosecutors may lose sight of the fact that often they are doing their jobs by declining to file charges, even after a lengthy investigation.

It’s not unheard of for prosecutors and investigators who have worked on a case for months or years to “fall in love” with their case or their witnesses and lose some ability to evaluate it objectively. That’s where some level of review by experienced and uninvolved prosecutors could be particularly useful.

I think it would be interesting if DOJ established some more formal mechanism whereby defense attorneys like those who appeared at the Federalist Society panel could obtain Main Justice review of proposed major indictments they feel are misguided. Currently defense attorneys can try to seek such a review, but there is no official process and no guarantee that anyone will listen. It would be easy for such a system to be abused, of course, and so setting up guidelines might be tricky. But if there were some official avenue for review of major cases, perhaps some mishaps such as those discussed by the panel could be avoided.

If inappropriate cases get filed it isn’t good for anyone: certainly not for those charged, not for the Department of Justice that ends up with a black eye, and not for the justice system as a whole. The culture within any institution is set at the top, and the Department of Justice needs a culture that emphasizes the importance of the sound exercise of prosecutorial discretion. If DOJ recognizes, as AAG Caldwell observed, that not all U.S. Attorney’s Offices are created equal and some lack appropriate expertise and experience, it would be wise to take some nationwide steps to remedy that situation and provide some safeguards.

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