Supreme Court Narrows Federal Bribery Law in a Win for Bob McDonnell

Update 9/8/16: The Justice Department announced today that it will not re-try the McDonnells and will be dismissing all charges.

 

Suppose I’m a state governor who knows there are many people who would like to meet with members of my cabinet or other state officials to press for some particular action. I set up a system where I say, “If you want me to arrange for you to meet with a public official to make your pitch, you pay me $10,000. It won’t be disclosed to anyone, I’ll just put it in my pocket. I’m not agreeing to influence what decision is made, I’ll just get you in the room. But if you don’t pay, no meeting.”

Most people would probably consider such a “pay for access” system to be corrupt. Access can be critically important. If two companies are competing for a government contract, the one that is able to get a personal meeting with the deciding official is likely to have a significant advantage – particularly if that meeting came at the request of the official’s boss, the highest elected official in the state.

But after today’s decision in McDonnell v. United States, according to the U.S. Supreme Court, although such behavior may be “distasteful” or “tawdry,” it does not violate federal bribery law. This unfortunate decision dramatically limits the scope of federal anti-corruption statutes by adopting an artificially narrow interpretation of “official action.” It’s a discouraging day for anyone concerned about the influence of money in politics.

In a unanimous opinion by Chief Justice Roberts, the Court today vacated the convictions of former Virginia Governor Bob McDonnell. McDonnell and his wife Maureen were convicted on multiple counts of corruption back in September 2014. The case centered on their relationship with a businessman named Jonnie Williams. Williams owned a company that made a dietary supplement called Anatabloc, and he was interested in having Virginia universities conduct research studies of Anatabloc to help him obtain FDA approval.

The evidence at trial established that Williams gave the McDonnells more than $170,000 in gifts. These included paying for the caterer for their daughter’s wedding, a Rolex watch, a shopping spree in New York for Maureen McDonnell where she purchased more than $10,000 in designer gowns, and $120,000 in no interest, no paperwork “loans.”

In exchange, the government charged, McDonnell agreed he would seek to promote Anatabloc within the Virginia government and seek to have Virginia universities perform the critical research studies. But the evidence did not establish that McDonnell’s efforts were particularly substantial or successful. He asked some government officials to meet with Williams to discuss possible studies of Anatabloc, hosted a product launch event at the Governor’s mansion, and made a few other inquiries on Williams’ behalf, but Williams never got the desired research studies or any other government benefit.

The McDonnells were convicted of two corruption offenses, Hobbs Act extortion under color of official right and honest services mail and wire fraud. When it comes to public corruption, both of these statutes effectively operate as bribery by another name. Bribery requires a corrupt quid pro quo: in exchange for receiving something of value, the public official agrees to use the power of his or her office to benefit the bribe payer.

The issue therefore boiled down to whether McDonnell’s conduct amounted to bribery under these corruption statutes. The parties throughout the case had agreed that honest services fraud and Hobbs Act bribery should be defined by using the language of the principal federal bribery statute, 18 U.S.C. § 201 (which applies only to federal public officials and was not used in the McDonnell case). As I’ve argued elsewhere, this is a questionable proposition for a number of reasons. But the Supreme Court agreed to resolve the case on that basis, and held that the outcome in McDonnell’s case should be controlled by the language of Section 201 – a crime with which he was never charged.

Section 201 defines bribery, in part, as a public official corruptly accepting a thing of value in exchange for agreeing to be influenced in the performance of an “official act.” “Official act” is defined as “any decision or action on any question, matter, cause, suit, proceeding or controversy, which may at any time be pending, or which may by law be brought before any public official . . . .” There was no question that McDonnell accepted things of value from Williams; the quid side of the equation was not at issue. The case boiled down to whether the steps taken by McDonnell fit this legal definition of “official act” — in other words, whether they were a legally sufficient quo.

Image of former Gov McDonnell. The Bob McDonnell bribery cases narrowed the scope of federal corruption law

McDonnell’s Conduct and “Official Acts”

Throughout the case, the defense had maintained that what McDonnell did for Williams did not amount to official acts under federal bribery law. McDonnell’s actions, they argued, were mere routine political courtesies that might be extended to any supporter or constituent. McDonnell may have introduced Williams to government decision-makers, but he never tried to put his “thumb on the scale” of any decision that those officials made. The critical distinction, they argued, was between providing mere access and actually engaging in the exercise of official power.

In an opinion that spends a good deal of time parsing the specific language of Section 201 quoted above, the Supreme Court agreed with McDonnell. The Court noted that determining whether there were “official acts” under Section 201 requires two steps: first, the Court must determine whether there was a “question, matter, cause, suit, proceeding, or controversy,” and if so, then whether the public official took any “decision or action on” that proceeding or controversy.

The Court first held that the terms “question, matter, cause, suit, proceeding or controversy” connote some kind of formal and structured exercise of government power, such as a lawsuit, determination by an agency, or hearing before a committee. The language suggests a specific and focused proceeding where something concrete is to be resolved. Simply arranging a meeting or making a phone call, the Court said, does not rise to this level.

The Court then considered whether making a phone call or arranging a meeting could be considered a “decision or action on” a proceeding or controversy, even if it was not a cause, suit, proceeding or controversy itself. The Court agreed with McDonnell that again these actions were insufficient. Making a phone call, arranging a meeting, or hosting an event is not a “decision” or “action” “on” any matter, suit, or controversy. Again, the language of the statute suggests some formal exercise of power by the official and some kind of substantive decision or action.

The government had argued for a broader interpretation of official acts that would encompass a wider range of activities routinely carried out by public officials, but the Court concluded that its narrower definition was required. Any broader reading, the Court held, would have dangerous constitutional implications due to the potential to criminalize many routine interactions between politicians and supporters that are an inherent part of our current political system. In addition, the government’s broader interpretation posed potential federalism concerns, giving federal prosecutors the power to set the standards of ethics and good behavior for state and local officials.

But the case was not a complete win for McDonnell. The Court rejected his argument that the statutes under which he was convicted should be struck down as unconstitutionally vague, holding that any potential vagueness was cured by the Court’s narrowing interpretation. It also rejected his request that the Court find he did not perform or agree to perform any “official acts” as now defined, holding that this determination should be made by the lower courts in light of the Supreme Court’s holding.

It’s the Agreement That Matters

The actions that McDonnell actually took on Williams’ behalf, the Court held, were not themselves “official acts.” But that is not the end of the inquiry. As the Court noted, for purposes of bribery law what matters is not what the government official actually did but what he agreed to do. The crime is the corrupt deal to sell your office. So even though McDonnell’s phone calls or arranging of meetings may not have been official acts themselves, they could serve as evidence that a corrupt deal existed between McDonnell and Williams in which McDonnell did agree to take official action.

The Court observed there was evidence at trial of things that would qualify as a “question, matter, cause, suit, proceeding or controversy,” such as the question whether Virginia universities should undertake research studies of Anatabloc. A government official deciding this question would be engaged in official action, as would another official (such as McDonnell) who tried to pressure or persuade that official to act.

The government failed to prove that the things actually done by McDonnell rose to the level of “decisions or actions on” any of these matters. But if there was proof that McDonnell agreed with Williams to take such action, that would be sufficient.

This will likely be the focus of the case going forward. The Fourth Circuit must consider whether there was sufficient evidence introduced for a properly instructed jury to conclude that there was an agreement between Williams and McDonnell for the Governor to engage in official acts – even if he ultimately did not really follow through or was unsuccessful.

What Happens Now

The key problem with McDonnell’s conviction, the Court held, was that the jury instructions did not accurately reflect the legal definition of “official act” that the Court has now adopted. As a result, McDonnell may have been convicted for conduct that does not violate federal bribery law. At a minimum, therefore, he is entitled to a new trial that concludes with new, proper jury instructions.

For now, the Court has sent the case back to the Fourth Circuit. That court is to decide whether, given the evidence at trial, a properly instructed jury could possibly find that an agreement existed between McDonnell and Williams that McDonnell would perform official acts in exchange for the gifts. If so, he could be re-tried and potentially convicted again. On the other hand, if the Fourth Circuit concludes that, in light of the Supreme Court’s holding, there was not sufficient evidence to prove that such an agreement existed, then McDonnell is entitled to have his case dismissed altogether and there will be no new trial. The Supreme Court said it was expressing no opinion on those questions.

Even if the Fourth Circuit determines that the evidence was potentially sufficient, it will be up to the government to decide whether they want to re-try the case. It seems likely that they would, but they would have to make that judgment in light of the Supreme Court’s holding, their own assessment of the evidence, and their judgment about the proper allocation of prosecutorial resources.

Beyond McDonnell, this case represents another narrowing of federal corruption laws by the U.S. Supreme Court. Six years ago in Skilling v. United States, the Court scaled back honest services fraud by limiting that theory to bribery and kickbacks, thus excluding other corrupt conduct such as acting on conflicts of interest. Now in McDonnell the Court has limited all of federal bribery law to an artificially narrow category of “official acts.”

The Court focused solely on the quo side of the bribery, acting out of professed fears that without a narrow definition of “official act” routine political courtesies extended in return for campaign contributions and routine support might  be criminalized. But this fails to take into account both sides of the bribery equation. This was not a campaign contribution case; the gifts from Williams to McDonnell were personal and went into his own pocket. The nature of the gifts themselves is substantial evidence of a corrupt agreement, which would not be true in a case involving routine campaign contributions. It’s not enough that there be a gift; it must be a corrupt gift. By focusing exclusively on the particular trees of McDonnell’s actions rather than the entire quid pro quo agreement, the Court missed the corrupt forest that was the relationship between McDonnell and Williams.

The Supreme Court has essentially ruled that using money to buy access the “little guy” can never hope to have is just politics as usual and is not corrupt — even when the money is in the form not of public campaign contributions but of secret, undisclosed personal gifts. The Court’s artificially narrow concept of “official action” has once again carved out a safe harbor in federal corruption law for behavior that most would consider not just unseemly, but criminal.

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