Sunday, February 14, 2010
Two former executives of Wilbros were sentenced with one receiving 15 months and the other 12 months. The case arose under the FCPA (see DOJ Press Release here) and involved alleged bribes in Nigeria. These two individuals plead to one conspiracy count but had guidelines exposure higher than the amount given to them. Most likely substantial assistance proved important to these former executives. Mark Weinhardt represented one of the individuals in this case.
See also Jesse Sunenblick, Main Justice, Former Willbros Executives Sentenced for Nigeria Bribery Scheme; Mary Flood, Houston Chronicle, Former Willbros executives get prison in bribery case; FCPA Blog, Prison for Ex-Willbros Execs
David Ingram, BLT Blog, Senate Confirms U.S. Attorney for D.C.
Richard Ben-Veniste and Dan Himmelfarb, Washington Legal Foundation Opinion Letter, Appellate Court Ruling Narrows Attorney Work Product Doctrine
Grant McCool & Matthew Goldstein, Reuters, Ex-Goldman programmer indicted over HFT code theft
Alexandra Clough, Palm Beach Post, White collar crime expert hired to probe FPL
Sheila McLaughlin, Cincinnati.com, Ex-banker pleads to $50K theft
Todd Ruger, Sarasota Herald Tribune, Sarasota jury might help Ponzi victims recover money
Peter Eisler, USA Today, FBI Tackling Rising Number of Haiti Scams
Chris Gair & Andrew Weissman, Midwest In-House, Fighting Governmental Efforts to Limit Defense Access to Witnesses
Susannah Nesmith, Andrew M. Harris & Joe Schneider, Bloomberg, Stanford Document Shredders Acquitted by Judge as Jury Debated; Rob Barry, Jay Weaver, Michael Sallah Crline, Miami Herald, Judge tosses out charges against legendary drug agent in Allen Stanford case
DOJ Press Release, Former UBS Client Pleads Guilty to Hiding $10 Million in Offshore Bank Accounts
David Owens, Hartford Courant,Paralegal Gets 46-Month Sentence
Carol D. Leonnig and Nick Schwellenbach, Washington Post, Former Blackwater employees accuse security contractor of defrauding government
Larry Neumeister, law.com (AP), New Indictment Boosts Insider Trading Charges Against Galleon Founder
David Barboza, NYTimes, China Indicts Rio Tinto Staff on Bribery Charges
(esp)(blogging from Palm Beach, Florida)
Friday, February 12, 2010
Hon Posner (7th Circuit) recently authored a majority opinion that reversed and remanded the district court's sentencing of Former Chicago Alderman Eddie Vrdolyak (see here). It was a 2-1 decision. But whether this opinion will be the final 7th Circuit decision remains to be seen, as Vrdolyak has filed a Petition for Rehearing En Banc. The Petition includes arguments such as a claim that the "panel majority decided the case based on issues and arguments not raised in the appeal." This petition presents an interesting discussion on the deference that should be given to trial judges when it comes to sentencing.
Petition for Rehearing With Request for Hearing En Banc -Download ERVPetReh2
United States District Judge Jean C. Hamilton today dismissed an options backdating case brought by the SEC, "finding that the SEC had presented no evidence to support the complaint." Attorneys representing Mike Shanahan Jr. were Stuart L.Gasner (Keker & Van Nest) and James Martin (Armstrong Teasdale).
See also Robert Patrick, St. Louis Post-Dispatch, Judge Tosses SEC Suit Against Shanahan
Sunday, February 7, 2010
Celestine Bohlen, Bloomberg, German Bounty Tears Veil Off Swiss Secrecy:
Edmund H. Mahony, Hartford Courant, Obama Nominates Fein For Connecticut's U.S. Attorney
Kim Dixon, Reuters, UBS client pleads guilty to hiding funds
Karen Freifeld & David Scheer, Bloomberg, Ken Lewis, Bank of America Sued by Cuomo for Fraud Over Merrill
Mike Robinson, KSRO 1350 (AP), Blagojevich charged in fresh corruption indictment
Grant McCool, Reuters,Galleon fight on wiretaps grows amid new pleas
Tuesday, February 2, 2010
Hemi Group v. City of New York, was decided by the Supreme Court with Chief Justice Roberts authoring the opinion (Scalia, Thomas, and Alito joined and Ginsburg joined in part). A dissent was written by Justice Breyer (Stevens and Kennedy joined). Justice Sotomayor did not participate in this case. The case provides guidance on what is required to meet civil RICO's causal element. The Court states:
"The City of New York taxes the possession of cigarettes. Hemi Group, based in New Mexico, sells cigarettes online to residents of the City. Neither state nor city law requires Hemi to charge, collect, or remit the tax, and the purchasers seldom pay it on their own. Federal law, however, requires out-of-state vendors such as Hemi to submit customer information to the States into which they ship the cigarettes.
Against that backdrop, the City filed this lawsuit under the Racketeer Influenced and Corrupt Organizations Act (RICO), alleging that Hemi failed to file the required customer information with the State. That failure, the City argues, constitutes mail and wire fraud, which caused it to lose tens of millions of dollars in unrecovered cigarette taxes. Because the City cannot show that it lost the tax revenue "by reason of" the alleged RICO violation, 18 U. S. C. §1964(c), we hold that the City cannot state a claim under RICO. We therefore reverse the Court of Appeals’ decision to the contrary." (emphasis added)
The Court also stated that "[p]ut simply, Hemi’s obligation was to file the Jenkins Act reports with the State, not the City, and the City’s harm was directly caused by the customers, not Hemi. We have never before stretched the causal chain of a RICO violation so far, and we decline to do so today."
Justice Ginsburg additionally notes, "I resist reading RICO to allow the City to end-run its lack of authority to collect tobacco taxes from Hemi Group or to reshape the "quite limited remedies" Congress has provided for violations of the Jenkins Act."
The dissent finds the "failure to provide the" state "with the names and addresses of its New York City cigarette customers proximately caused New York City to lose tobacco tax revenue."
Monday, February 1, 2010
The Ninth Circuit Court of Appeals issued a decision in United States v. Treadwell, that affirmed convictions in a case involving a Ponzi scheme. The government said that Treadwell was the "mastermind" of this Ponzi scheme and the appellate court found that more than 1,700 investors lost their investment from this Ponzi scheme. Following a jury verdict, the defendants were sentenced with Treadwell getting 300 months imprisonment; Sluder received 188 months and Saturday 63 months. There were also other terms for each of these sentences. Defendants appealed their convictions and also contested their sentences. The defendants claimed that "intent to defraud" under the wire fraud statute requires an "intent to cause an actual loss." They also argued that there was a Sixth Amendment violation in that "their sentences cannot be upheld as 'substantively reasonable' under 18 USC 3553(a) without reliance on judge-found facts - such as the amount of loss caused by the fraud - in violation of their Sixth Amendment jury trial right." Defendant Treadwell also argued that it "was error for the district court to impose a two-point upward adjustment for misrepresentations that he was acting on behalf of a charitable organization;" and that "his sentence is substantively unreasonable under 18 USC 3553(a). The Ninth Circuit rejected the arguments of defendant and affirmed the conviction and sentence.
(esp)(w/ a hat tip to Linda Ramirez)