Sunday, May 6, 2007

White Collar Crime Conference - Part V

Stephanie Martz, White Collar Crime Project Director at the National Association of Criminal Defense Lawyers (NACDL), guest blogs a six part series on the recent White Collar Crime Track at the NACDL Cincinnati Conference:

Session V: "Litigating intent in white collar cases"

This was a single-person presentation by Ed Garland, senior partner of Garland, Samuel & Loeb in Atlanta, GA.

Intent, in white collar cases, is all about the facts. And when gathering the facts, start with the jury charge. Your motions will help you to get details – industry standards, regulations alleged to be violated, etc.

Be mindful of the application of cases like the recent US v.Holmes, which held that defendants have a right to present their theories of the case – he believed the money was going to a legitimate rather than illegitimate enterprise; or the defendant did not know that the salary he was receiving was income (that’s US v. Cheek; also see US v. Rogers, an 11th Circuit case, in which the defendant did not know the nature of his weapon).

And of course, in dealing with intent, you will come up on the issue of deliberate ignorance. The district court should only give that instruction where there is active avoidance – where the defendant went out of his/her way to avoid knowledge of the incident.

The bad news about how even intent to defraud has been watered down: in a money laundering case with a mail fraud predicate, the judge denied defendant’s request for a good faith defense in mail fraud. And the 11th Circuit ultimately ruled that the general instruction on intent and knowledge was enough to cover good faith; although the district court was wrong not to give the instruction, it was "harmless error" (if the facts are bad enough, the law goes out the window) (US v. Martinelli). But push the good faith instruction, especially where you’ve relied on the advice of an accountant or an attorney. (Of course, this can be difficult evidence to adduce from the professional at issue – pin the lawyer/accountant down early and try to take a signed statement.)

Character witnesses can serve as surrogate proof of intent – if your client can take the stand. Jurors lump all kinds of evidence like that into the equation: "bad person = bad intent."

Finally, relevance is often your threshold argument in getting evidence admitted re: intent. Did he believe that the employees would have sanctioned the withdrawal of funds and therefore it wasn’t embezzlement? (Proof allowed) … You have to get creative sometimes. "He did not intent for his statements to deceive anyone" is the hardest to prove and the hardest on which to get evidence admitted; you need to put the haystack in evidence. … This rapidly brings to mind the Scooter Libby case. The court let numerous stipulations and other evidence come in based on the myriad things he was trying to remember; but the predicate to the relevance was his OWN testimony. And he didn’t testify. Was this the right ruling under US v. Holmes? This is sure to be a huge issue on appeal.

Where your only defense is intent, you have to think very long and hard about the risk of the whole case rising and falling on your client’s testimony.

(sm/posted by esp)

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