Thursday, August 28, 2008

Commentary on Stein (KPMG)

Chief Judge Jacobs of the Second Circuit authored the 68 page opinion that affirms Judge Kaplan's prior ruling (see here and here) in the KPMG related matter.  The lower court had dismissed the defendants' indictments.  In affirming the lower court opinion, the Second Circuit states -

"We hold that KPMG’s adoption and enforcement of a policy under which it conditioned, capped and ultimately ceased advancing legal fees to defendants followed as a direct consequence of the government’s overwhelming influence, and that KPMG’s conduct therefore amounted to state action. We further hold that the government thus unjustifiably interfered with defendants’ relationship with counsel and their ability to mount a defense, in violation of the Sixth Amendment, and that the government did not cure the violation. Because no other remedy will return defendants to the status quo ante, we affirm the dismissal of the indictment as to all thirteen defendants." (footnotes omitted)

The Second Circuit stated that the Sixth Amendment right to counsel held that the amendment "protects against unjustified governmental interference with the right to defend oneself using whatever assets one has or might reasonably and lawfully obtain."  The court noted that-

"Defendants were indicted based on a fairly novel theory of criminal liability; they faced substantial penalties; the relevant facts are scattered throughout over 22 million documents regarding the doings of scores of people,; the subject matter is "extremely complex,"; technical expertise is needed to figure out and explain what happened; and trial was expected to last between six and eight months, As Judge Kaplan found, these defendants "have been forced to limit their defenses . . . for economic reasons and . . . they would not have been so constrained if KPMG paid their expenses." We therefore hold that these defendants were also deprived of their right to counsel under the Sixth Amendment. (citations and footnote omitted)

The best line from the case - "But if it is in the government’s interest that every defendant receive the best possible representation, it cannot also be in the government’s interest to leave defendants naked to their enemies."

The government did not lose this case, as some might say.  In fact, they won.  When justice is done for all, as is reflected in this opinion -- the prosecution, defense, and society wins. 

(esp)

http://lawprofessors.typepad.com/whitecollarcrime_blog/2008/08/commentary-on-s.html

Attorney Fees, Defense Counsel, Judicial Opinions, KPMG, Prosecutors | Permalink

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Tracked on Sep 2, 2008 7:56:30 PM

Comments

That may once have been true; however, the gulf between society on one side and government and prosecution on the other has grown into a chasm of us vs them that may have crossed the point of no return in this iteration of civilization.

Posted by: great unknown | Aug 28, 2008 1:58:04 PM

Real justice would have seen the Court deliver severe sanctions, up to and including jail time, for the prosecutors who undertook the scheme to force KPMG to deny its employees their contractual benefits.

Or at the least, I hope the decision concludes that the prosecutors actions were outside the scope of their proper jurisdiction, and thus not subject to any shield of immunity.
(So that the defendants can sue the idiots!)

RGN

Posted by: R. G. Newbury | Aug 28, 2008 2:13:08 PM

Suppose the government here had not made the threats that it did, but simply prosecuted the company on the theories it was relying on to make the threats (i.e., the threats that the company would be prosecuted itself if it helped the individual defendants with their legal fees). Would that be appropriate? I mean, if the company says: "yes, the actions of these defendants were in the course and scope of their employment, and so we are going to pay their legal fees for these criminal charges," cannot that be used to support the theory that the corporation itself is culpable for their actions? Of course, "course and scope of employment" does not imply necessarily that the actions were sought by or intended by the corporation, but it certainly leaves open that possibility. If the government made no threat at all, simply stated it was continuing to investigate whether to bring charges against the corporate entity itself, and the corporate defense lawyers decide independently that not paying the defendants' legal bills would reduce the company's criminal exposure, is that ok?

Posted by: PatHMV | Aug 28, 2008 3:02:16 PM

"Had I but served my God with half the zeal I served my king, He would not in mine age have left me naked to mine enemies."
-- Henry VIII, Wolsey at IV, i.

Judge Jacobs is a scholar and a very wise man.

Posted by: SgtDad | Aug 28, 2008 3:16:23 PM

The government did not lose this case, as some might say. In fact, they won. When justice is done for all, as is reflected in this opinion -- the prosecution, defense, and society wins.

Well said, Professor Podgor.

Posted by: Jim Rhoads aka vnjagvet | Aug 28, 2008 3:24:51 PM

Disgusting that these defendants - who were still able to spend millions on their defenses - get away with their crimes because they were somehow deprived of their right to counsel, while defendants have been put to death and are on death row in cases where they barely had a defense at all that was determined to be constitutionally adequate.

You commentators make me sick.

Posted by: harvey | Dec 18, 2008 4:38:35 AM

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