It should be a happy Thanksgiving in the Kuehne household this year. The U.S. Attorney’s Office for the Southern District of Florida dropped its misguided money-laundering prosecution of the prominent Miami attorney today, following a devastating opinion from the Eleventh Circuit Court of Appeals last month. The Miami Herald has the story here.
You are currently browsing the monthly archive for November 2009.
Adam Liptak has a decent piece here in today’s NYTimes about the alliance between certain conservative and liberal intellectuals against the overcriminalization of our society, primarily at the federal level. The article makes it appear that this particular left-right alignment is brand new, which is inaccurate. For example, Ed Meese, who is featured in the article, has long been in the forefront of the fight against overcriminalization at the federal level. Nor does the alignment cover the entire intellectual-political spectrum. If it did, Congress would presumably stop passing vague and overbroad criminal laws every time some scandal emerges.
In truth, this is an alliance between the criminal defense bar, civil libertarians with criminal defense bar ties, economic libertarians, the Chamber of Commerce, some traditional conservatives, certain segments of the Federalist Society, and former prosecutors who now represent white collar defendants. This doesn’t mean that the alliance is bad, or that its arguments are faulty. Far from it. In fact, the entire federal criminal justice system is heavily rigged, substantively and procedurally, in favor of the prosecution. Don’t expect this to change anytime soon. There is no constituency for being soft on white-collar crime.
The article mentions in passing the three honest services fraud cases that are currently before the U.S. Supreme Court. Justice Sotomayor, who is not mentioned in the article, is on the wrong side of the honest services issue if her Second Circuit jurisprudence is any indication. She appears to be part of the New Deal school of Supreme Court jurisprudence–generally strong on civil liberties, but weak on limiting the reach of draconian federal white collar criminal statutes. I don’t expect her to be receptive to most of the arguments against overcriminalization. Her writings and/or votes on the honest services cases will tell us a lot on this point.
We are delighted to come out of hibernation and report the acquittal of former Bear Stearns hedge fund managers Ralph Cioffi and Matthew Tannin by a federal jury in Brooklyn. The New York Post has the story here. It was obvious from the start that the case was weak and that the government was essentially trying to criminalize puffery. The Post takes the away the lesson that proving guilt in cover-up cases, as opposed to outright fraud cases, will now involve a “high hurdle” because of the verdicts. I wouldn’t be so quick to draw this conclusion. As a general matter, proving a cover-up is easier than proving a fraud. Every case is unique. One of the differentiating factors is the trial judge. Here, the defense was aided by, among other things, Judge Block’s key evidentiary ruling excluding a potentially damaging email written months before the hedge funds at issue collapsed. Sounds like the ruling was correct.