Sidebars Five Year Anniversary: The Top Ten Posts

Five years ago today I published my first post on this blog, a piece about a New York Times reporter at risk of being held in contempt for refusing to identify a source. Sidebars has grown a lot since then and has been fortunate enough to gain some accolades along the way (including my favorite shout-out from the D.C. Bar Magazine: “Come for the ongoing smackdown with Alan Dershowitz, stay for the trenchant commentary on the rule of law”) . To mark this anniversary,  I thought it would be fun to take a look back at the Sidebars “Top Ten”: my ten most-read posts over the past five years.

During those five years I’ve written more than 120 posts on Sidebars, an average of about one every two weeks. My pace of posting on the blog has definitely slowed down over the past couple of years as I’ve been writing more as a contributing columnist for the Washington Post and working on an upcoming video lecture course on white collar crime for The Great Courses. But the blog continues to be a great vehicle for deeper dives on selected topics; at about 2500-3000 words, my average post on Sidebars is more than three times the length of a typical op-ed in the Post. Brevity may be the soul of wit, but it’s rarely a lawyer’s strong suit — and some of these subjects really do call for a more in-depth analysis.

As readers know, my focus on Sidebars is on white collar crime. The investigation by special counsel Robert Mueller was the most consequential white collar case in a generation, so it’s probably not surprising that a majority of my top posts related to that investigation. Other major white collar cases, such as the prosecutions of Virginia governor Bob McDonnell and New Jersey Senator Bob Menendez, also have been bountiful sources of material. But whatever else you might think of them, you can’t top the Mueller investigation and the Trump administration when it comes to providing material for commentators on white collar crime. These results definitely reflect that.

And with that – here are the Sidebars Top Ten.

#10: Fake News and the National Review

Andrew McCarthy of the National Review is a former federal prosecutor for the Southern District of New York. As a columnist, he’s been a vociferous critic of the Mueller probe and booster of president Trump. During the Mueller investigation he regularly wrote columns attacking the investigation that were so factually and legally off-base that it’s hard to believe he was once an Assistant U.S. Attorney. Now that Mueller is done, McCarthy is still at it, peddling pro-Trump conspiracy theories about Ukrainian interference with the election and the “Deep State” efforts to take down the president. In what became my tenth most popular post, I collected a number of the arguments from McCarthy’s columns about Mueller and showed how he was misleading his readers. I sent the post to the National Review, and I along with some other law professors on Twitter encouraged McCarthy and the National Review to respond, but they never did.

10) What Andrew McCarthy Gets Wrong about the Mueller Investigation – 3/22/18

 

#9: When is Lying a Federal Crime?

The False Statements statute, 18 U.S.C. 1001, is a workhorse in the white collar prosecutor’s stable. It broadly criminalizes material false statements made to the federal government, even if not under oath. A number of witnesses in the Mueller investigation, including Michael Flynn and George Papadopoulos, pleaded guilty to false statements for lying to the FBI during interviews. The statute applies to written false statements as well, and early in the Mueller investigation there was speculation that individuals including Jared Kushner and Jeff Sessions might be liable for concealing various foreign contacts when they filled out paperwork to apply for a security clearance. In this post I explained the scope and requirements of the false statements statute and how it potentially could apply in such a case.

9) Lying on a Security Clearance Form: The Crime of False Statements – 6/5/17

#8: The Dershowitz “Smackdown”

Harvard Law Professor Alan Dershowitz was a vocal critic of the Mueller investigation. For two years Professor Dershowitz was all over conservative media attacking the investigation and making sweeping arguments about executive power and presidential immunity from prosecution that frankly seemed increasingly unhinged.  I’ve written several different posts and articles rebutting Dershowitz’s claims.  The most popular blog post has been this one from June 2017,  taking on Dersh’s argument that the president can’t be charged with obstruction of justice because, well, he’s the president.

8) Trump and Obstruction: What Alan Dershowitz Gets Wrong – 6/19/17

#7: A RICO Review

The Mueller probe offered me several opportunities to write posts explaining the elements of leading white collar statutes and then illustrating them by discussing their potential application to the Mueller investigation. The False Statements post, number nine above, was one such example. Another one ended up as number seven on the list. It provides a primer on the Racketeer Influenced and Corrupt Organizations act (RICO) and then discusses how it potentially could apply to the matters that Mueller was investigating. Mueller, of course, did not end up pursing RICO charges against anyone, Russian or American. But we may not have heard the last of RICO and president Trump. Prosecutors in the Southern District of New York may be looking at possible RICO charges involving the Trump Organization. The SDNY is notoriously fond of RICO, and regardless of whether the other elements of the crime could be established, the Trump Organization is a classic RICO “enterprise.”

7) RICO and the Mueller Investigation – 1/16/18

#6: Fraud and the Sentencing Guidelines

My sixth most popular post is completely unrelated to Mueller. In 2015 the Federal Sentencing Commission revised the guideline used to calculate the sentence in federal fraud cases. That guideline is key to white collar practice because so many white collar cases involve fraud charges. The old guideline had come under a lot of criticism for the way it calculated white collar sentences, and reform was thought to be long overdue. In this post I discussed the changes made by the new fraud guideline and explained why those amendments really amounted to little more than tinkering around the edges.

6) The New Sentencing Guideline for Fraud Cases – 5/4/2015

#5: What’s This Blog About, Anyway?

I’m particularly pleased this post made it into the Top Ten. It deals with what seems like it should be a fairly simple and foundational question: what is white collar crime? If you look in the federal criminal code you won’t find a definition, or a section titled “white collar offenses.” In fact, there is no universally accepted definition of white collar crime, even though it clearly is recognized as a distinct practice area — not to mention as the subject of my law school class. This post, way back from only the second month of the blog, is my take on the definition and characteristics of white collar crime. One key takeaway?   — the name itself is something of a misnomer.

5) The Definition of White Collar Crime – 11/26/14

 

#4: Who Isn’t Guilty of That?

I wrote this post on Contempt of Congress back during the Obama administration, when the Republican Congress held the IRS Commissioner, Lois Lerner, in contempt. Prosecutors declined to pursue the case and that was the end of it, and the post lay largely dormant for a couple of years. But recently there has been renewed interest in Congress’s contempt power, in light of the apparent stonewalling of Congressional investigations by the Trump administration. And that has led to a lot of renewed interest in this post, catapulting it to number four on the list. Will Congress dust off its inherent contempt power and start locking up recalcitrant witnesses in that  rumored jail cell in the basement of the Capitol? We may soon see.

4) Contempt of Congress – 4/20/15

#3: Bribery and the Emoluments Clause

Since before president Trump even took office, there has been controversy about his extensive business holdings and whether he might profit from the presidency in violation of the Constitution’s emoluments clause. This relatively obscure Constitutional prohibition is now the subject of several ongoing lawsuits. My third most popular post, written after the election but before Trump was inaugurated, explained the foreign emoluments clause, how it relates to federal bribery law, and whether Trump was at risk of violating it.

3) The Emoluments Clause, Bribery, and President Trump – 11/29/16

#2: It’s Conspiracy, Not Collusion

In the early days of the Mueller investigation, a frequent refrain from the president and his supporters was that collusion with the Russians, even if it did take place, would not be a crime. I wrote this post early on in the Mueller investigation. It explained how, for criminal law purposes, the proper term is conspiracy, not collusion. It also described how allegations that the Trump campaign colluded with the Russians to influence the election, if true, could in fact constitute a conspiracy to defraud the United States — even if the conduct did not directly violate another criminal statute.

2) Yes, Colluding with Russians to Interfere with the Election is a Crime – 7/5/17

#1: “Collusion” is a Crime

My most popular post of all time — by quite a large margin — also dealt with the question of “collusion.” In February 2018 Mueller indicted thirteen Russian individuals and three Russian companies for engaging in a social media campaign to influence the 2016 presidential election. The lead charge in that indictment was a conspiracy to defraud the United States by impairing, obstructing, and defeating the lawful government functions of the Federal Election Commission, State Department, and Justice Department. This was the same legal theory I had outlined about six months earlier in my second most popular post, described above. One of the indicted Russian companies appeared in court and challenged that conspiracy charge. In November 2018 the federal judge in the case denied that challenge and upheld the conspiracy theory that effectively can make “collusion” a crime. My post describing that judge’s ruling, and the possible implications for the Trump campaign, because my most popular post of all time.

1) Judge in Mueller Case Upholds Legal Theory that Makes Collusion a Crime – 11/23/18

Thanks for indulging me in this look back.  Whatever the next years bring, I suspect there will continue to be no shortage of material. Thank you for reading!

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A Bridge Too Far? Supreme Court Agrees to Hear the Bridgegate Case

In a series of decisions over the past thirty years, the Supreme Court has narrowly interpreted federal public corruption statutes and made it more difficult for prosecutors to bring such cases. A common theme of those decisions is the Court’s fear of giving federal prosecutors too much power to police political misconduct through criminal prosecutions. Now the Court appears poised to act again: it has agreed to hear the appeal of two New Jersey officials convicted in the “Bridgegate” scandal, and is likely to reverse their convictions. Although I disagree with some of the Court’s earlier rulings in corruption cases, in this case that’s probably the right result.

Chris Christie

The Bridgegate Scandal

The George Washington Bridge, which connects Fort Lee, NJ to New York City over the Hudson river, is the busiest bridge in the world. On a normal day, twelve lanes carry traffic inbound to New York City, with three lanes reserved for local commuter traffic from New Jersey. The bridge is operated by the Port Authority of New York and New Jersey, an interstate agency that controls bridges, tunnels, and other transportation infrastructure  in the NY/NJ area.

Chris Christie, the governor of New Jersey, was running for re-election in 2013. Bridget Ann Kelly was Christie’s Deputy Chief of Staff. In the months leading up to the election,  she was responsible for seeking endorsements of Christie from local elected officials. Despite repeated requests, the Democratic mayor of Fort Lee told Kelly that local political considerations would not allow him to endorse Christie, a Republican.

William Baroni was the Executive Director of the Port Authority and David Wildstein was his Chief of Staff. Both had been appointed by Christie. Wildstein suggested to Kelly that the Port Authority could shut down the inbound access lanes on the bridge in order to put pressure on Fort Lee’s mayor. Kelly responded in an email, “Time for some traffic problems in Fort Lee.” Wildstein then told Baroni that Kelly wanted the lanes shut down to “punish” the mayor for his refusal to endorse Christie.

To justify the lane closures, Wildstein and Baroni made up a cover story that the Port Authority was conducting a traffic study on the bridge. They also agreed that the closure would begin on September 9, the first day of school in Fort Lee. Because there would only be a single lane of traffic open from New Jersey, the Port Authority would have to pay an extra worker to back up the sole toll taker in that booth. Baroni approved that extra expense.

When the lane closures took place, they created massive gridlock across all of Fort Lee. In addition to being a nightmare for commuters and school buses, it created a public safety issue because fire fighters, paramedics, and police could not travel to areas where they were needed. The mayor of Fort Lee made frantic efforts to contact the Port Authority about the closure and the safety hazards it was creating, but Baroni refused to take his calls. The closures lasted for four days until the Executive Director of the Port Authority learned about them and ordered the regular traffic lanes restored.

The Criminal Charges

 Federal prosecutors indicted Kelly and Baroni on federal charges including wire fraud, 18 U.S.C. 1343, and theft from a federally-funded entity, 18 U.S.C. 666. Wildstein agreed to plead guilty and cooperate with prosecutors. He testified that the traffic study was a pretext and that the true reason for the lane closures was to punish Fort Lee’s mayor.

The government’s criminal theory under both statutes is essentially the same. Prosecutors argue that the defendants deprived the Port Authority of its property through the lane closure scheme. That property allegedly included wages paid to the workers required to execute the lane closures, including the salaries paid to the extra toll both worker and even the salaries of Baroni and Wildstein themselves. The government also argues the defendants deprived the Authority of the intangible right to control the physical assets of the bridge lanes and toll booths. And these alleged deprivations of property were fraud, the government claims, because the defendants lied about the true reason for the lane closures.

Baroni and Kelly were convicted at trial. Kelly was sentenced to 18 months in prison and Baroni to 24 months, although they were allowed to remain free pending appeal. The Third Circuit Court of Appeals upheld the convictions. The defendants asked the Supreme Court to hear the case, arguing that their convictions were inconsistent with a long line of Supreme Court precedents concerning political corruption prosecutions. On June 28, in the final week of its term, the Supreme Court granted the petition for certiorari. The case should be argued this fall.

Image of US Supreme Court, which decided the Bob McDonnell case

The Supreme Court and Public Corruption

Kelly and Baroni’s main argument is that the prosecutors in their case have tried to do an improper end run around the Supreme Court’s public corruption precedents, particularly those concerning honest services fraud. I think the Court is likely to agree.

Honest services mail and wire fraud became a very popular public corruption theory in the post-Watergate area. Fraud typically requires that the defendant deprived the victim of money or property. But in an honest services fraud case, the defendant is charged with depriving the victim of the intangible right of fair and honest services that the victim was owed by someone. Most honest services fraud cases involve political corruption, because politicians owe a duty of fair and honest services to their constituents. Although less common, the theory applies in private sector relationships as well; for example, an employee may deprive his or her employer of its right to the employee’s honest services by taking some action against the employer’s interests.

Federal prosecutors used honest services fraud to prosecute a wide range of political misconduct that was corrupt, sleazy, or dishonest, even if it did not clearly violate other criminal laws. It was particularly useful in cases involving state and local corruption, because the key federal bribery statute does not apply to state and local officials. But in the 1987 case of McNally v. United States, the Supreme Court brought this to a screeching halt. In a surprise decision, the Court threw out the honest services fraud theory as too vague, even though it had been upheld by every lower court to consider it. Due process requires that criminal laws provide fair notice of what is prohibited, but no defendant, the Supreme Court held, could be sure what qualified as honest services fraud. The sweeping ability to prosecute any potentially “dishonest” behavior gave prosecutors too much authority to set “standards of good government for state and local officials.” The Court held that to “defraud” someone in federal criminal law meant to deprive them of money or property, not of intangible rights like the right to honest services. If Congress wanted fraud to include the honest services theory, the Court said, it needed to “speak more clearly.”

Congress responded the following year by passing 18 U.S.C. 1346, which explicitly says that honest services fraud is a valid theory under federal fraud statutes. But although Congress said its purpose was to overturn McNally, it didn’t further explain what it meant by honest services. This led to another two decades of confusion and inconsistency in the lower courts, as they tried to define the parameters of the sweeping theory. Finally, the Supreme Court stepped again in 2010 in Skilling v. United States, where Jeff Skilling, the former CEO of Enron, challenged his conviction for private sector honest services fraud. The Court declined Skilling’s request to strike down the theory completely, but it held that honest services fraud must be limited to cases involving bribery or kickbacks – core political corruption. Self-dealing, conflicts of interest, or other forms of sleazy political behavior will no longer support an honest services fraud prosecution.

The Court has narrowed public corruption law in other areas as well. In United States v. Sun-Diamond Growers of California the Court held that prosecutors in a gratuity case must prove a direct link between a particular gift to a politician and an identified official act. This struck down a popular prosecution theory known as a status gratuity, where someone gave gifts to an official because of his or her position and ability to benefit the donor in the future but not necessarily because of any particular official act. It also invalidated prosecutions based on relationships involving a string of gifts to an official and a series of official actions benefiting the donor, but not necessarily a one-to-one correlation between gift and action. This kind of ongoing relationship, where someone effectively has a politician on retainer, may be extremely corrupt. But it is now out of reach of federal corruption laws unless prosecutors can link a specific gift to a specific official act beyond a reasonable doubt.

Most recently  — and most dramatically — the Court limited the scope of federal bribery law in the 2016 case of McDonnell v. United States. In McDonnell the Court adopted a very narrow definition of what qualifies as an “official act” that will support a federal bribery conviction. Virginia governor Bob McDonnell had accepted about $170,000 in secret gifts from businessman Jonnie Williams, who was seeking benefits from the state government. But the Court held that the things McDonnell did in return – making some calls, setting up some meetings, and holding an event for Williams at the governor’s mansion – did not constitute “official acts” under federal bribery law. (For a more detailed critique of the Court’s decision in McDonnell and its implications, see my post here.)

(As an aside, it was kind of amusing to see that former governor McDonnell filed an amicus brief urging the Court to accept review of the Bridgegate case. He was joined on the brief by media mogul Conrad Black, whose honest services fraud conviction was reviewed and overturned at the same time as the Skilling decision. Those two former defendants argued that the Bridgegate prosecution is another example — supposedly like their own cases — of federal prosecutors who are running amok and need to be reined in. At least it’s good to know the former governor is keeping himself busy.)

The George Washington Bridge

The Defense Arguments

The Bridgegate defendants argue that prosecutors essentially have dressed up what might have been an honest services fraud case before McNally and Skilling to disguise it as a traditional fraud case. They couldn’t charge honest services fraud because no bribes or kickbacks were involved. So they charged traditional wire fraud, alleging the defendants deprived the Port Authority of property in the form of lost wages and the right to control the lanes and toll booths. And the reason this is fraud, the government argues, is that the defendants lied about their true reason for closing the lanes.

In their successful petition for certiorari, Kelly’s attorneys wrote that the appeal presents the following question:

Does a public official “defraud” the government of its property by advancing a “public policy reason” for an official decision that is not her subjective “real reason” for making the decision?

If the answer to this question is “yes,” they argue, then all of the Court’s precedents from McNally on down will be invalidated. Prosecutors would be free to charge a public official with fraud any time he or she lied about the true political motivation behind some official action. Almost any such case will involve the use of at least some government resources, particularly if those resources may include the salaries of the official himself or herself, as alleged in the Bridgegate prosecution. If lying about the true reason for some politically-motivated action constitutes fraud, they argue, potential criminal liability for political misconduct would become almost unlimited.

I think the Court is likely to agree with the defendants. The lane closure itself was not inherently unlawful. The Port Authority had the right to adjust the lanes, and no law or regulation required those three lanes to be kept open for Fort Lee. The defendants did not profit or line their own pockets through the scheme. In short, they did something they had the authority to do for a nakedly political reason, and then lied about that reason. It was a deplorable act that harmed the Fort Lee community. But I think the Court is likely to agree with the defendants that it should not be criminal.

The Court’s decisions have tended to limit criminal corruption to core, quid pro quo transactions where politicians are enriching themselves through abuse of their office. That’s not the case here. And all of the Court’s historical concerns about giving prosecutors the power to criminalize political misconduct that falls short of core criminality will come into play in this case. For better or worse, politicians routinely act for political reasons while claiming to act only in the public interest. They engage in “spin” or otherwise mislead or even lie to the public about their true motivations. But however distasteful or sleazy, that alone has never been considered criminal. The Court is not likely to sanction making such political machinations the subject of a federal prosecution.

The Court may decide the Port Authority was not really deprived of property and so was not defrauded. The alleged loss was relatively trivial; the salaries involved most likely would have been paid anyway, and the Port Authority did still maintain control of the traffic lanes. Or the Court may simply conclude that the definition of “fraud” in federal criminal law does not encompass a politician lying about the true reason for some political act that was otherwise lawful. But whatever the rationale, I expect a pretty resounding rejection of this prosecution.

Political Acts and Criminal Remedies

There is a tendency these days to reach immediately for criminal remedies in cases of misconduct by public officials. We have a president who led chants of “lock her up!” when talking about the supposed misdeeds of his political opponent. If an administration official says something untrue during testimony before Congress, there are immediate calls for a perjury prosecution. But as I always tell my students on the first day of class, there is a lot of sleazy, unethical, rotten, immoral stuff that goes on in the world that isn’t criminal. We should hesitate to embrace legal theories that make it too easy to punish political misconduct with criminal prosecutions.

This concern about over-criminalization is another theme in recent Supreme Court decisions.  In cases like Yates (fisherman charged with  obstruction of justice for throwing undersized fish overboard) and Bond (woman charged with chemical weapons violation for putting a caustic chemical on a doorknob, causing a minor skin irritation) the Court has demonstrated its unhappiness with prosecutors seeking harsh criminal sanctions for behavior that may not call for them. Such cases figure prominently in the Bridgegate briefs.

I think McDonnell was wrongly decided. I’d like to see Congress step in and amend the public corruption statutes to respond to the decisions in McNally, Skilling, and Sun-DiamondBut in this case, I think the Bridgegate defendants are right. They lost their jobs in disgrace. There could have been some appropriate civil remedies in the form of lawsuits by those harmed by the traffic snarls. Certainly their boss Christie suffered great political damage from the scandal and saw his presidential ambitions flame out in a hurry. All of these remedies and consequences, and probably more, are appropriate. But a federal criminal prosecution is not the appropriate remedy for this kind of political mischief.

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