Monday, July 11, 2011
On Oct. 27-28, 2011, the ABA and the AALS will present a joint conference, Reducing Reliance on Incarceration, at the Liaison Capitol Hill Hotel in Washington, D.C. The first event of the conference, on the afternoon of Thursday Oct. 27th, is a workshop for scholarly papers relating to the conference theme. Participants will present their work in a roundtable format. Abstracts or drafts will be shared among presenters and discussants in advance of the workshop. Workshop presenters must commit to attending both days of the conference, which will include a plenary and multiple break-out sessions on the topic of reducing reliance on incarceration. For a description of the program, please visit http://www.americanbar.org/content/dam/aba/events/criminal_justice/2011colloquium.authcheckdam.pdf. Workshop presenters will be responsible for their own travel and hotel costs, and will be required to pay the conference registration fee. To apply to workshop a paper, please email an abstract of 500 words to both email@example.com and firstname.lastname@example.org by Sept. 1, 2011. Space is limited and presenters will be chosen by members of the organizing committee.
Sunday, July 10, 2011
If you have an obstruction case premised on section 1519, you might want to check out this article by T. Markus Funk (Perkins Coie) in NACDL's Champion Magazine. It's titled, "Honey Laundering, A Toilet Flush, and a Governor's Yahoo Account: The New Age of Anticipatory Obstruction of Justice."
It is hard to move businesses in different directions. I like to use the analogy of turning a ship around -- it takes time, dedication and a steady hand.
Corporate governance is shifting again. We had the revolution of Sarbanes-Oxley in the early 2000s and now we have a new movement afoot. It is no coincidence that aggressive changes in white collar enforcement coincide with significant changes in the corporate governance landscape.
The newest trend -- which I fully endorse -- is the creation of corporate compliance committees. For most businesses, a separate compliance committee is an effective means to focus on difficult compliance issues, demonstrate a management commitment to compliance, and facilitate communications on compliance issues within an organization. By establishing such a committee, a company sends a very clear message. But the committee has to be more than just window dressing -- it has to have the support, the resources, and dedicated members with real expertise in the compliance area.
I like to use another analogy -- a compliance committee is like your dashboard on your car, telling you how fast you are going, how much fuel you have, and allowing you to signal others on the road.
A compliance committee should help your company navigate your legal obligations by empowering your decision makers with the right information. It serves a proactive role, separate from the audit committee which has a number of critical obligations related to Sarbanes-Oxley enforcement.
The compliance committee is responsible for ensuring that the company is complying with key legal and regulatory obligations. It is your primary vehicle by which to manage risk.
The compliance committee must actively gather and disseminate information reporting on overall compliance efforts. It must also communicate compliance issues and business risks to the right people. The right people include responsible managers, who are directly responsible for significant day-to-day business decisions.
The compliance committee must include one or more independent members who understand the regulatory environment, as well as the principles of good governance. This has a number of advantages. The independent member can test reports and statements, and mine discussions for issues that may otherwise go uncovered; may be able to share broad industry information and trends; and is likely to be less susceptible to a company’s internal culture (which might be reluctant to discuss certain risks and violations).
A well-structured compliance committee is your ultimate protection against potential legal and regulatory violations. I encourage others to look at such committees as part of an overall compliance program.
Friday, July 8, 2011
Mike Scarcella, BLT Blog, Court Disbars Former DOJ Official Charged In Abramoff Scandal
Peter Sampson, NewJersey.com, A 'shocking' split verdict in trial of former Secaucus Mayor Elwell
Shreveporttimes.com, Financial crimes: Watch the cash drawer and your credit cards
Del Quentin Wilber, Washington Post, Dozens of questions for Clemens jury pool
The NYTimes has a main story today, titled, As Wall St. Polices Itself, Prosecutors Use Softer Approach. Contributing blogger Sol Wisenberg offers an important perspective to the discussion - the problem of cooperation when the enterprise itself is tainted.
But the article itself misses some key aspects in its criticism of deferred prosecutions. It fails to look at the net result of a prosecution with and without a deferred prosecution agreement. With a deferred prosecution agreement you have the company admitting to culpability, you have change in the company assured, you usually have monitors added to the organization to avoid future problems, and you obtain the entity's cooperation. Does the company suffer? Most definitely yes - they pay huge fines. For example, Seimens - 800 million; Daimler - 185 million; SnamprogettiNetherlands BV - 240 million. And the cost for this prosecution or threat of prosecution is low because the company is agreeing to pay the fine. On the other hand, if the case had gone to trial there is the risk of a not guilty verdict (e.g., WR Grace; Xcel Energy, Inc.). Even if the company is convicted it will have cost the US taxpayer a significant amount of money for the prosecution, and the net result will be - payment of a fine by the company. The reality that is missed in this NYTimes article is that corporations cannot be put in jail. And if you put the company out of business - like Arthur Andersen LLP then you are putting many innocent workers out of a job that they were doing honestly. And maybe it's OK if it's a civil matter, like Bank of America just paying 8.5 billion to settle its problem with the money going to investors.
Deferred prosecutions do have their problems. For example, many of the terms in the agreement are one-sided, the company often has no choice but to agree, and corporate executives can get thrown under the bus to save the company. (See my co-authored article here).
But calling the use of deferred prosecutions a "softer approach" is missing what gets achieved with deferred prosecutions.
Thursday, July 7, 2011
Former Governor George Ryan brought a collateral attack, pursuant to 28 U.S.C. s 2255, following the Supreme Court's decision in Skilling. He argued among other things "that the jury instructions were defective because they permitted the jury to convict him on an honest-services theory without finding a bribe or a kickback." The district court, however, found his errors harmless. Interestingly the prosecutor conceded that despite Ryan not filing his 2255 motion within the one year time period, "2255(f)(3) restarts the time when a 'right has been newly recognized by the Supreme Court and made retroactively applicable to cases on collateral review,'" and Ryan met this standard. Did the government want this case heard because they want to find the contours of what is encompassed within Skilling?
The Seventh Circuit issued its opinion in which it states that "[c]ollateral review is not just a rerun of the direct appeal, in which a defendant can use hindsight to craft better arguments." They go on to stress the limits of collateral review. The court states that Ryan's "current argument that the jury instructions were defective because they did not track Skilling is novel." But they also state that "[i]f Ryan's lawyers had done what Skilling's lawyers did, the controlling decision today might be Ryan rather than Skilling. The bottom line is that the court holds that "[o]n the record at trial, a jury could have convicted Ryan of mail fraud using the legal standard set by Skilling."
Commentary: 1) Even white collar cases are seeing the problems created by limits to collateral attacks. 2) Skilling is certainly not like McNally was to mail fraud cases when the Court issued it in 1987.
Wednesday, July 6, 2011
Larry Neumeister (AP), Greenwichtime.com, Ex-employee pleads guilty to insider trading in NY
Mike Scarcella, BLT Blog, Prosecution, Defense Gear Up For Clemens Perjury Trial
Walter Pavlo, White-Collar Crime, Forbes, White-Collar Crime – When Prison Is Not Convenient
Kate Knable, Arkansas Business.com,Nine Arkansas Lawyers Who Know White-Collar Crime
Detroit Free Press, Brian Dickerson: Jim Robinson -- a lawyer whose example others sought to copy (with a hat tip to Michael Naughton)
It is not often that companies are criminally charged, and usually when it happens, regardless of the merits, we see the company enter a guilty verdict or enter into a deferred prosecution agreement (see here). But not Xcel Energy, Inc. and Public Service Company of Colorado. They were charged, they exercised their right to a jury trial, and were found not guilty after close to a month-long trial.
The Justice Department brought criminal charges against this Fortune 250 public company alleging safety violations - OSHA violations - in the deaths of five contractors at a hydro-electric power plant in Colorado.
Clearly this is an incredibly sad situation, with many families suffering and one cannot help but have the deepest sympathy for each person who has suffered here.
But one also has to wonder whether our criminal justice system should be used for prosecutions alleging OSHA violations from industrial accidents. Would these matters be better left for the administrative and civil process? And would our scarce resources be better spent educating companies on how best to keep workers' safe?
The company was represented by Cliff Stricklin, Chair of Holme Roberts & Owen's White Collar & Securities Litigation Group in Denver, Colorado. Stricklin also is an adjunct professor teaching white collar crime at University of Colorado School of Law.
See also John Ingold, Denver Post, Xcel Energy Found Not Guilty in 2007 Deaths of Five Workers in Colorado
Tuesday, July 5, 2011
DC white collar heavyweights Greg Poe and Preston Burton have joined forces to create Poe & Burton PLLC. It is a catchy name, although I prefer Greg and Preston's Excellent White Collar Adventure. Preston has represented many high-profile white collar defendants, including Aldrich Ames, Robert Hanssen, and Monica Lewinsky. Greg is the author of several impressive amicus briefs in cutting-edge cases, including Booker. He is currently representing a former Blackwater executive in an EDNC criminal case with national security implications. Combined they have litigated over 60 criminal cases to verdict. Good luck, guys.
Elliot Berke recently left his own practice to become a Partner at McGuireWoods LLP. Elliot is one of the most respected election law and government ethics compliance attorneys in the country. In the House of Representatives he served as Counsel to the Office of the Speaker and General Counsel to the Office of the House Majority Leader. He currently counsels individuals and entities regarding election and governmental compliance issues and represents individuals under investigation by Senate and House ethics panels and the DOJ. Elliot has been known to hang out at the Prime Rib-the true sign of a Washington insider.
My old friend Mike McCrum has just left big law to start the McCrum Law Office in San Antonio. For my money, Mike is the best white collar attorney in the Southwest. His biggest claim to fame was his spectacularly successsful defense of San Antonio criminal defense attorney Alan Brown against tax fraud charges brought by DOJ's Brenda Morris in her pre-Ted Stevens days. Mike's performance was masterful. After a six-week trial, the jury deliberated for 35 minutes (including bathroom breaks) and acquitted on all charges. Best of luck, my friend.
Saturday, July 2, 2011
If you're writing about a criminal punishment-related topic this summer, consider participating in the ABA-AALS joint conference "Reducing Our Reliance on Incarceration," October 27-28 in D.C. In addition to a fantastic line-up of confirmed speakers, there will be an opportunity to present works-in-progress in a roundtable format, scheduled for the first afternoon of the conference, Oct. 27th. Be on the look-out later this summer for a Call for Submissions (helpfully timed to coincide to when you might be uploading your abstract to Express-o). If you'd like more information before then, feel free to contact Giovanna Shay at email@example.com.
Friday, July 1, 2011
Dominique Straus-Kahn has received from the district attorney what most defendants never get -- early Brady material. Today's New York Times reports that "Strauss-Kahn Case Seen as Near Collapse" because prosecution investigators have discovered "major holes in the credibility" of the housekeeper who claims he sexually attacked her.
The District Attorney should be commended for the early disclosure of the purported victim's credibility problems. I cannot help wonder, however, whether such disclosure would have been made -- certainly so early -- in a case where the defendant did not have such considerable legal and investigative firepower that it could be predicted that his team would itself eventually discover at least some of the victim's credibility problems. I also would love to know, and am sure I never will, what the discussions were in the prosecutor's office about whether and when to disclose this Brady material. In this connection, I also wonder whether the resignation of the head of the sex crimes unit a few days ago is just a coincidence.
Brady revelations by prosecutors are rarely easily made, especially when they are serious enough, as may well be the case here, to destroy the prosecution case. It goes against the grain for any competitor -- and most prosecutors are competitors trying to win -- to provide information that will hurt his case, let alone destroy it. And I have no doubt that at least some of the prosecutors involved in this case still firmly believe that Strauss-Kahn did sexually attack the housekeeper and that all this stuff about money laundering and the like is besides the point or, in legal parlance, immateriaL.
Experienced prosecutors know that they can almost always get away with Brady violations. The number of prosecutions or disciplinary actions against prosecutors for Brady violations is miniscule. Appellate courts are generally loathe to reverse convictions for anything but egregious Brady violations, generally finding that the withheld information was immaterial. There are certainly generally well-meaning prosecutors who would have withheld the exculpatory information here to increase their chances of achieving what they believe is the just result. And there are others less well-meaning, and far fewer, who would have withheld the information to advance their own careers.
Response by Professor Larry Ribstein here. (esp)