Overcriminalization

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Here is the transcript of the hearing in which Judge Cormac Carney granted Defendant’s Motion to Dismiss in U.S. v. William Ruehle. Ruehle was Broadcom’s former CFO. The dismissal was based on prosecutorial misconduct (primarily witness intimidation by AUSA Andrew Stolper) and insufficient evidence. Carney also dismissed the Indictment against Broadcom’s co-founder and former CEO Henry Nicholas, who had not yet gone to trial. The Nicholas dismissal was based solely on prosecutorial misconduct involving witness intimidation. Carney had previously thrown out the guilty plea of Broadcom co-founder Henry Samueli and dismissed the felony information to which Samueli pled guilty.

There were stirring and memorable words spoken at the hearing, and the transcript is well worth reading in its entirety. Here is a portion of Judge Carney’s closing remarks:

NOW, I’M SURE THERE ARE GOING TO BE MANY PEOPLE WHO ARE GOING TO BE CRITICAL OF MY DECISION IN THIS CASE AND ARGUE THAT I’M BEING TOO HARD ON THE GOVERNMENT. I STRONGLY DISAGREE. I HAVE A SOLEMN OBLIGATION TO HOLD THE GOVERNMENT TO THE CONSTITUTION. I’M DOING NOTHING MORE AND NOTHING LESS. AND I ASK MY CRITICS TO PUT THEMSELVES IN THE SHOES OF THE ACCUSED.

YOU ARE CHARGED WITH SERIOUS CRIMES AND, IF CONVICTED ON THEM, YOU WILL SPEND THE REST OF YOUR LIFE IN PRISON. YOU ONLY HAVE THREE WITNESSES TO PROVE YOUR INNOCENCE AND GOVERNMENT HAS INTIMIDATED AND IMPROPERLY INFLUENCED EACH ONE OF THEM. IS THAT FAIR? IS THAT JUSTICE? I SAY ABSOLUTELY NOT.

Here is Judge Cormac Carney’s Dismissal Order in U.S. v. William J. Ruehle and U.S. v. Henry T. Nicholas. Most of the newspaper stories on the Broadcom debacle failed to note that Judge Carney dimissed the case against Ruehle for insufficiency of the evidence as well as prosecutorial misconduct. Ruehle’s Rule 29 Motion was granted after jeopardy attached, but before the jury began deliberating. Therefore, the government cannot appeal, and Ruehle cannot be re-tried. With respect to Nicholas, he wasn’t even on trial yet at the time of Carney’s order dismissing the Indictment with prejudice. The government can therefore appeal the dismissal in Nicholas’s case.

The Washington Post reports here that the Salahis have (wisely) decided not to testify in front of the House Committee on Homeland Security. They have also lawyered up with Dewey & LeBoef, since, among other things, their original lawyer (Paul W. Gardner) has become a witness. This new-found silence is probably too little too late, given the couple’s two-day interview with the Secret Service. Meanwhile, the Post reports here that the Washington Redskins Cheerleaders Alumni Association is livid, because Michaele Salahi performed with the group at a September 20 halftime show. Turns out that Michaele never was an actual Redskins Cheerleader. She lied her way onto the alumni group’s membership list. Even worse, ”she was too tall and couldn’t dance.” And, this just in, the Post reports here that the State of Virginia is now investigating the fundraising activities of America’s Polo Cup, a Salahi-run business entity that raises funds for the Salahis’ charity, Journey for the Cure. The Post had previously reported that the Salahis left a long line of vendors with unpaid bills related to America’s Polo Cup events. Let’s hope Dewey & LeBoef got its money up front. The White House wants the story to go away. It won’t.

Today’s Washington Post reports here on the dubious history of Tareq and Michaele Salahis’ annual charity polo event and their Journey for the Cure foundation. According to the story, the Salahis stiffed a number of vendors who worked on the event and misrepresented the extent of corporate sponsorship. The Land Rover America’s Polo Cup web site lists some sponsors, including Land Rover, who “say that they are not sponsors for that event.” Plenty of material for any federal law enforcement types intent on ginning up a prosecution.

Here is the latest news from the Washington Post about Michaele and Tareq Salahi, the social-climbing Northern Virginia “power couple”  who revealed to the world how easy it is for just about anyone to slip into the White House and gain access to the President during a state dinner.

Initial stories about the Salahis’ caper quoted U.S. Secret Service sources to the effect that a criminal investigation was in the works, but nobody said what criminal law the couple may have violated.

Now some press accounts are trudging out 18 U.S.C. Section 1001, as a possible prosecution vehicle. I have written extensively over the years about Section 1001, the statute that criminalizes lying to government agents. Okay, I’ve actually written one article and revised it several times.

Section 1001 literally covers  ”whoever, in any matter within the jurisdiction of the executive, legislative, or judicial branch of the Government of the United States knowingly and willfully–(1) falsifies, conceals, or covers up by any trick, scheme, or device a material fact; (2) makes any materially false, fictitious, or fraudulent statement or representation; or (3) makes or uses any false writing or document knowing the same to contain any materially false, fictitious, or fraudulent statement or entry.”

Whether the Salahis’ conduct on the night of the state dinner fits into one of these subsections obviously depends on the particular circumstances of their case. But the Salahis have apparently made it infinitely easier for the government to prosecute them under Section 1001. The New York Times reports here that the Salahis submitted to interviews, over the course of two days, with Secret Service agents.

Unless they were immunized beforehand, a highly unlikely scenario, submitting themselves to these interviews was a really stupid thing  for the Salahis to do. Lying to a government agent during an interview, even if you are not under oath, is a crime under Section 1001, as long as the lie is material. The materiality threshold under the statute is very low. Indeed, most of the abuse that takes place under Section 1001 arises from the prosecution of people who allegedly fibbed during interviews with government law-enforcement agents.

The Salahis were under no obligation to talk to the Secret Service. There was no upside to such an interview. The Secret Service is embarrassed and out for blood. It’s hard for me to believe that the Salahis enjoyed the  services and advice of a criminal attorney prior to their Secret Service interview. Of course, sometimes clients do unwise things, against the advice of counsel. The Salahis crave publicity and are doing everything within their power to milk their 15 minutes of fame.

I have long complained about the breadth and misuse of Section 1001.  In a government of purportedly limited and enumerated powers, the idea of criminalizing a simple lie to any federal agent who comes knocking at a citizen’s door is appalling.

On the other hand, the Salahis’ conduct on the night of the state dinner, assuming that they were uninvited, is not funny in the least. It sent a terrible signal to the world about Presidential security. Nor should the Salahis be celebrated in any way. The couple actively engaged in a planned and publicized effort to enter the White House complex. If they lied in order to do this, and if their conduct clearly falls within an appropriate criminal statute, they should be prosecuted.

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.