Wednesday, May 11, 2005

Should Materiality Be an Element of Obstruction of Justice?

Blog co-editor Ellen Podgor will have an article coming out in volume 44 of the Washburn Law Journal, as part of a symposium issue on white collar crime, that compares the obstruction charges against Arthur Andersen and Martha Stewart.  The article, entitled Arthur Andersen, LLP. and Martha Stewart: Should Materiality be an Element of Obstruction of Justice?, is summarized as follows:

Obstruction of justice, with its many different statutes, is a crime that prosecutors can use with relative ease. It covers a wide breadth of activity and has few limitations. This paper examines the prosecutorial use of obstruction charges in the cases of Martha Stewart and Arthur Andersen, LLP. Although the statutes differed in these two prosecutions, with Arthur Andersen, LLP., prosecuted for the crime of obstruction of justice under 18 U.S.C. Section 1512, and Martha Stewart, prosecuted for several criminal charges including obstruction of justice under 18 U.S.C. Section 1505, both demonstrate how prosecutors can leave unfinished the original activity that was the subject of investigation to proceed with the easier obstruction charge.

This article provides a way to restrict prosecutors in their use of the crime of obstruction of justice when it is used solely for expediency purposes. In essence, it reads in an element of materiality as required for this crime in a manner similar to how the Supreme Court included materiality for fraud prosecutions. By adding an element of materiality as a requirement for an obstruction conviction, prosecutors are forced to complete investigations that can be completed on the substantive charges. In contrast, investigations that cannot continue because the obstructive conduct precludes continuation because of either destruction of evidence or intimidation of witnesses, still have available the ability to appropriately punish the activity via a charge of obstruction of justice.

With the recent arguments in Andersen in the Supreme Court and Stewart in the Second Circuit -- and perhaps destined for the Supreme Court too? -- this is a timely article that looks at the aggressive prosecutions initiated in these cases and questions whether the obstruction statutes are being used properly. The article is available on SSRN here. (ph)

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