Thursday, July 15, 2010
Wednesday, May 26, 2010
Guest Blogger - Op Ed
With more than 20 years as an American criminal defense lawyer, I have witnessed the drafting and enforcement of innumerable federal criminal laws and regulations that patently fail to meet the basic requirements of fairness and justice. More and more, ordinary, hard-working people are being prosecuted for doing seemingly lawful, everyday things that run afoul of federal authorities or the tax collector. And then their nightmare begins.
Recently, I represented a physician who with other physicians and a medical supply company were involved in what can only be described as a profound personal and professional nightmare for them. Federal prosecutors decided to publicly investigate the clients for making treatment referrals that were not covered by Medicare or Medicaid. The patients in question, a number of whom were injured on the job and on worker’s compensation, came to the clients seeking to be made well again. When the clients made referrals for special treatment for patients with private insurance, sometimes the claims would be covered and honored by the insurance carrier, and sometimes they would not. It would depend on the carrier and the individual’s circumstances. To be sure, the treatment in question in this case has been covered by multiple insurance carriers whose names we all recognize.
Well, buried deep in the criminal code and the accompanying regulations, there are criminal penalties for making certain types of medical referrals when the patient’s medical care is covered by, in this case, (federally funded) Texas Medicaid or Medicare. In fact, a referral for more than $100 of the particular treatment in this case for a Medicaid/Medicare-covered patient can result in many years in prison – if dishonesty is involved. But today, the federal prosecution bar is set much lower than the bar for ordinary crimes such as theft. Even a mere paperwork mix-up can result in a major criminal investigation where federal regulations are concerned.
After three years of search warrants, subpoenas, interrogations, public embarrassment and scrutiny in the media, threats to their professional licenses, and significant legal and other expenses, it was determined that, as the clients knew all along, they had done nothing wrong. No indictments were issued. Their lives, the lives of their patients, and necessarily the lives and practices of other physicians and professionals seeking nothing more than to do right by their patients and clients, will never be the same. They must now live with the knowledge of what we as criminal defense attorneys have been watching unfold for decades – we are all potential victims of poorly drafted laws that can be improperly and selectively applied by prosecutors. The irony has not been lost on me. These doctor-clients were prosecuted not because they harmed anyone, but because they tried to help people.
To be sure, health care fraud is a pretty big business in America, with significant costs to all of us. But when the laws passed to deter and punish those who are actually committing those crimes are so poorly crafted that they lead to honorable, decent, everyday people becoming ensnared in our criminal justice system, there is no better evidence that we have a serious problem that must be addressed at the highest levels. We have reached a point where the federal criminal code rivals or exceeds the federal tax code in volume and complexity.
For nearly two years, the National Association of Criminal Defense Lawyers and the Heritage Foundation have studied this problem, and its causes, in great depth. Noting that the federal criminal code alone now has an estimated 4,450 federal crimes, with an estimated tens of thousands more criminal provisions buried in the federal regulatory code, our organizations set out to see how defective laws, specifically those lacking adequate intent requirements, actually get enacted. The conclusions of this study, and the common sense recommendations to stop and reverse this trend and return the federal criminal law to its rightful role in our free nation, are set forth in a recently released report, "Without Intent: How Congress Is Eroding the Criminal Intent Requirement in Federal Law."
As a practicing member of the criminal defense bar, I know that a lawyer’s job is to protect everyone’s rights, not just those of the criminally accused. Congress makes that job harder when it fails to recognize that a criminal law that no one understands – particularly one that can be violated accidentally, with no intent to hurt anyone – disserves society. Congress is eroding a core element of the criminal law – the intent to do harm or unjustly enrich one’s self. I hope members of Congress and their staff will consider that, and our report, the next time someone says, “There oughta be a law.”
Friday, May 21, 2010
The Ohio State Journal of Criminal Law is hosting an amici blog of views from the field. Online is a piece by Jocelyn Kelly (Jones Day, Cleveland) that is titled, "Advocacy Before the Courtroom: The Life of an Associate in a White Collar Criminal Defense Practice."
Tuesday, April 27, 2010
Former United States Solicitor General Theodore B. Olson will represent Mississippi attorney Paul Minor in his upcoming appeal to the Supreme Court of the United States. Olson, now with the law firm Gibson, Dunn & Crutcher LLP, moved immediately into action with an extension of time application that provides clues as to the arguments that will be forthcoming. For openers Minor's convictions are tied to the "honest services" statute, a statute under review this term in three cases (Skilling, Black, and Weyrauch). Also mentioned is the tension between the Fifth Circuit's decision in Minor's case and the McCormick and Sun-Diamond Supreme Court decisions that necessitate a quid pro quo. The Fifth Circuit had previously vacated the convictions premised on section 666 and remanded the case for resentencing. The Fifth Circuit in its decision also noted that both the McCormick and Evans cases "left open the question of what level of specificity is required to prove a quid pro quo in regard to the 'quo' or agreed-upon official act." What is particularly fascinating about this case is that it has "honest services" but also includes bribery allegations. If 1346 is unconstitutionally vague this issues may be resolved. But if the Court distinguishes bribery cases under honest services fraud, it may open up other arguments on when a bribery would fall within the reach of the "honest services" fraud statute.
Friday, March 19, 2010
(esp) (w/ disclosure that she is a B.S. graduate of Syracuse U.- home of the Trac Reports).
Sunday, February 21, 2010
Saturday, January 23, 2010
Jack Litman, a former and long-time member of the National Association of Criminal Defense Lawyers (NACDL) board of directors and a past president of the NYSACDL passed away Saturday. Ted Simon, Secretary of NACDL and dear friend of Jack, described him as "an incomparable lawyer, father, and friend." As a member of the law firm of Litman, Asche & Gioiella, LLP, he handled major felony cases in New York, like the defense of Robert E. Chambers Jr. He also represented individuals charged with white collar related crimes. Past NACDL President Barry Scheck, described him as a man with a
"first rate intellect, a love of art, history, and all things Fench. But perhaps most impressive of all, sometimes with gestures of kindness and loyalty unknown to many, he delivered when it counted for his friends, his clients, and the cause of liberty. Jack never buckled trying one of the most notorious murder cases in the history of New York City."
Jack was special to so many. For me he was the extraordinary lawyer with whom I could discuss arcane legal issues, talk about the art museum in Vegas or just talk about life. He was a crucial part of my NACDL family. He was one of the nicest most caring individuals one could come across in life. He will be missed, and my tears are for him. He was one of a kind.
(esp) With a special thank you to his dear friend, Ted Simon, for the photographs. See also Anemona Hartocollis, NYTimes, Jack T. Litman, Lawyer for ‘Preppy Killer’ and Others, Is Dead at 66; Talkleft here; Professor Ellen Yaroshefsky reminded me of the Ethics in America, Vol. 2: To Defend a Killer program that includes Jack Litman, Justice Scalia and others as panelists.
Thursday, December 10, 2009
Monday, December 7, 2009
What does the death penalty have to do with white collar crime? Perhaps the most obvious item to those who practice white collar criminal defense work, is that many white collar attorneys handle or assist on capital cases. It therefore seems important to notice the white collar attorneys of a recent American Law Institute change.
On October 23, 2009, the ALI Council voted overwhelmingly, with some abstentions, to accept the resolution of the capital punishment matter as approved by the Institute’s membership at the 2009 Annual Meeting in May. The resolution adopted at the Annual Meeting and now accepted by the Council reads as follows:
“For reasons stated in Part V of the Council’s report to the membership, the Institute withdraws Section 210.6 of the Model Penal Code in light of the current intractable institutional and structural obstacles to ensuring a minimally adequate system for administering capital punishment.”
Wednesday, November 25, 2009
The government dismissed Ben Kuehne's case today. For background on this case see here, here, and here. Congratulations to Attorney Ben Kuehne and to his counsel Jane Moscowitz and John Nields. The Government's motion states in part:
"This motion is based upon the totality of the circumstances surrounding this matter, including the changed circumstances occasioned by the affirmance of this Court's dismissal of Count One of the Third Superseding Indictment. The Government believes that dismissal is in the interests of justice."
Motion - Download Kuehne dismissal order
Thursday, November 19, 2009
The U.S. Attorney's Office for the Southern District of Georgia has their press release telling the world of a 40 count indictment of a Columbus, Georgia attorney. But no where on the website is the fact that a jury acquitted this same individual on all counts. As ministers of justice it should not be enough for prosecutors to merely say on the courthouse steps that they accept the jury verdict. Prosecution press releases should not be limited to indictments and guilty verdicts, but should also include the not guilty verdicts.
Shelnutt had been charged with a list of offenses that reads like someone opening the federal statutes and trying to find anything that could be used to destroy an attorney especially one who represents criminal defendants. They charged him with money laundering, aiding and abetting a cocaine conspiracy, attempted bribery of a federal official, witness tampering, failure to file cash reporting forms, and making false statements to an FBI agent.
The bottom line is that the jury did not accept the government's case. See Chuck Williams, Ledger - Enquirer, Shelnutt acquitted -Juror says government's case 'had a lot of holes'
Monday, October 26, 2009
No surprises in the Eleventh Circuit opinion affirming the trial court's dismissal of Count One in the Ben Kuehne case. The nine page opinion authored by Hon. Barkett, and joined by Hon. Hull and Quist provides a quick response to the government's contention that 18 U.S.C. 1957 (f)(1) was "nullified" by the Court's decision in Caplin & Drysdale - not so. The court states:
It would therefore make little sense- and would be entirely superfluous-to read § 1957(f)(1) as an exemption from criminal penalties for non-tainted proceeds spent on legal representation, as those funds can always be used for any legal purpose. We do not believe Congress intended such an absurd result ...
(esp)(w/ a hat tip to Joe Beeler)
Friday, October 2, 2009
NACDL's 5th Annual Defending the White Collar Case Seminar - "Getting Paid, Not Charged--Avoiding Indictment by Collecting Fees Ethically," Friday, October 2, 2009
Guest Blogger: Jon May, Chair, White Collar Crime Section, National Association of Criminal Defense Lawyers
Over the last ten years, and particularly as a result of the indictment of prominent Miami Attorney Ben Kuehne, criminal defense counsel have had cause to be concerned that they could be the subject of prosecution solely for taking a legitimate legal fee. In this morning’s presentation by Jane Moscowitz and Martine Pinales, lawyers found reasons to be hopeful that such fears may be overblown, at least as to potential prosecution. Forfeiture of fees, on the other hand, remain a significant concern.
The Kuehne prosecution is an instance of ideology trumping common sense. Benedict P. Kuehne is the most unlikely of government targets. As Jane Moscowitz, who is one of his attorneys observed, Ben is the best of all of us. He is not just a leader of the bar—having been the President of the Miami-Dade County Bar Association and a member of the Board of Governors of the Florida Bar—he has devoted countless hours to pro bono activities on behalf of organizations representing the interests of African-Americans, Hispanics, Gays and others. He was also one of Al Gore’s principal attorneys during the Florida recount. Not surprisingly, he was Roy Black’s choice for counsel when Roy Black needed an attorney to vet the legal fees he was to be paid to represent notorious Colombian cartel leader Fabio Ochoa.
Roy Black was ultimately paid $5 million for his representation of Ochoa. Ben Kuehne earned approximately $175,000 for vetting this fee. Ben was indicted for conspiracy to launder, what the government recognized, and the indictment stated, was a bona fide legal fee. This is despite the fact that the money laundering statute 18 U.S.C. Sec. 1957 contains a specific exemption for the receipt of funds necessary to preserve the Sixth Amendment. It was the government’s position before the District Court and just recently before the Eleventh Circuit in their appeal from the dismissal of this count, that the decision of the Supreme Court in Caplin and Drysdale nullified this exemption. The district court, however, was persuaded that it was the intent of Congress to protect counsel from prosecution, even if attorney’s fees could be forfeited. It appears from the tenor of the oral argument, which I was present to see, that the government’s theory is being met with the same level of skepticism that it received by Judge Cooke.
Martin Pinales discussed his experience dealing with government efforts to seize legal fees. Even in instances where the AUSA states that she has no intent to seize fees, counsel can be faced with a post trial effort by the government’s money laundering/forfeiture counsel to claw back those fees. Strategies were discussed for dealing with that problem. One way is to be paid by a third party from monies totally unconnected to any alleged criminal activity. Where money is obtained from the defendant, it is important to insure that the money did not come from any source named in a forfeiture count. And counsel should do due diligence even as to assets that could be later characterized as a substitute asset. It was also important to have your retainer agreement tie fees received to services provided. Where the funds are clearly substitute assets, counsel who takes these steps will have a better chance of demonstrating that they are bona fide purchasers for value in later forfeiture proceedings.
During the seminar, other important issues were raised. In many districts, counsel do not have to worry about their fees if their clients cooperate. Doesn’t that create a conflict of interest? You can charge a flat fee so long as you can demonstrate that it was earned. But don’t call it non-refundable (unless you practice in Florida, but it still has to be reasonable). The final irony, and outrage, discussed was the fact that the indictment against Ben also includes forfeiture count. The government is seeking to forfeit from Ben, the $5 million that Roy Black received.
Thursday, October 1, 2009
NACDL's 5th Annual Defending the White Collar Case Seminar - "Choppy Waters - The Ethics of Privilege and Disclosure," Thursday, October 1, 2009
Guest Blogger: Peter D. Hardy, Post & Schell, P.C. (Philadelphia, PA)
Moderator: Gerald B. Lefcourt
Gerald Lefcourt noted that it has been over 46 years since the Brady decision was issued, yet we still have no firm definition of Brady that most federal prosecutors can follow. There are varying and conflicting practices amongst prosecutors in regards to definitions and the proper time frame for disclosures. Moreover, incidents of Brady violations or potential violations are not uncommon.
Robert Cary represented Senator Ted Stevens. The heart of the defense was a note that Senator Stevens had sent to Bill Allen, the key government witness and the builder making improvements on the Senator’s chalet, which stated in part that the Senator wanted to make sure that Allen got fully paid, and that “friendship is one thing, but compliance with these ethics rules is another[.]” The government responded to this note by eliciting testimony from Allen that the note was just the Senator trying to concoct a cover story. After the guilty verdict, the second FBI agent on the case filed a self-described whistleblower complaint regarding conduct by the prosecution team. The Court ordered the government to provide discovery regarding the complaint, and a new prosecution team was put in place. New discovery contradicted directly the government’s theory and evidence at trial that Allen regarded the note as a mere cover story. Carey described the Attorney General as a hero for moving to dismiss the case. All of this happened only after a long trial and post-trial process (as well as Senator Stevens losing his re-election bid). Judge Sullivan, who oversaw the case, is to be commended for being careful and not simply taking the government’s word.
So, what should be done? Judge Gertner explained that the solution needs to involve the rules (ethical, court, and criminal procedure). The case law has slid into an outcome-determinative approach, which makes it very hard for the prosecutor to predict. The materiality standard is colliding with the harmless error doctrine. Brady had more to do with a failure to turn over evidence impugning the system, rather than predictions regarding potential outcomes. The definition of Brady should be re-assessed, and there also should be deadlines set for when information should be turned over: for example, 28 days before.
Professor Green described how the ABA code of ethics set forth in the 1970s a discovery rule for prosecutors: you must turn over information that would tend to negate the guilt of the accused. Everyone had assumed that this rule overlapped with Brady. But, the rule is not co-extensive with Brady – for example, it does not have a materiality standard. Rather, it categorically requires the disclosure of favorable information, or information which might lead to favorable evidence. A materiality test is really directed at post-conviction review, and is not well suited to govern the conduct of prosecutors at the time they are making their discovery decisions. Defense attorneys also need to know about exculpatory information in order to assess a case and decide whether or not to proceed to trial.
Paul Shechtman described federal plea agreements in New York which require waivers by the defendant of either impeachment and/or all exculpatory information. These plea waivers apparently run afoul of the rules just described by Professor Green. Current cases strongly suggest that prosecutors need more education regarding their obligations under Brady, in order to be better able to appreciate the exculpatory value of evidence. We need to reassess Brady, which has been hijacked by the materiality doctrine. The burden now is on the defendant to show materiality. In Brady, Justice Marshall wrote in dissent that the test instead should be harmless error, in which the government has the burden to show that the conviction should not be reversed. The materiality requirement invites courts to preserve convictions, despite poor decisions and poor decision-making processes by prosecutors.
Larry Thompson described a case in Detroit in which the prosecutor made false statements to the Court, and actually was prosecuted himself. Judge Gertner noted that part of the problem here is lack of meaningful remedies. There is professional discipline, but discipline is unlikely.
Wednesday, September 30, 2009
The Ninth Circuit Court of Appeals issued a decision in United States v. Ruehle,a case that opens by saying "[w]e here explore the treacherous path which corporate counsel must tread under the attorney client privilege when conducting an internal investigation to advise a publicly traded company on its financial disclosure obligations." The lower court had suppressed "all statements from former CFO William J. Ruehle to attorneys from Irell & Manella LLP, Broadcom's outside counsel, regarding the stock option granting practices at Broadcom." In reversing this decision, the Ninth Circuit, rejected the lower court finding that Ruehle "had a reasonable belief that Irell and Manella were his lawyers prior to the June 1, 2006 interrogation by Irell, and that he never gave informed written consent, either to the dual representation by Irell or the disclosure of privileged information to third parties..." The Ninth Circuit found that the lower court had "applied a liberal view of the privilege that conflicts with the strict view applied under federal common law, which governs here." The Ninth Circuit stated that it "reject[s] the district court's contrary finding that an expectation of confidentiality was established because, upon review of the record, we are left with the 'definite and firm conviction that a mistake has been committed' and thus we determine that this factual finding was clearly erroneous." Some thoughts on this decision:
- Although at first glance it may seem like the Ninth Circuit is usurping a factual finding of the lower court, there is more to this picture - it is factual finding, yes, but one that had been determined by a different legal standard. What is interesting here is that the Ninth Circuit chose not to remand to the lower court when changing the operative standard for determining the issue. On the other hand, the court's decision implies that the evidence does not create a factual question.
- Every corporate officer needs to be aware that statements made during an internal investigation may end up in the government's lap. One can't always count on an attorney client privilege to protect these statements.
- Outside counsel's job in conducting internal corporate investigations may have just been made more difficult as one wonders if corporate officers will want to cooperate in corporate counsel's internal review.
Wednesday, September 23, 2009
David Oscar Markus (Southern District Florida Blog) reports on the oral argument in the Ben Kuehne case in the 11th Circuit here. What is most amazing here is that the government was appealing the decision of the lower court. For background see here. The statute provides that the term monetary transaction "does not include any transaction necessary to preserve a person's right to representation as guaranteed by the sixth amendment to the Constitution." Should we really be spending tax resources on a case like this?
Sunday, May 31, 2009
Ms. Regon, formerly of Shipman & Goodwin LLP, Hartford, CT, has represented individual and corporate clients in state and federal civil and criminal investigations. She is a member of the bars of Connecticut and Massachusetts and is admitted to the U.S. Court of Appeals for the Second Circuit. She has represented clients facing a variety of criminal charges including fraud, public corruption, RICO, tax fraud, espionage, felony escape, criminal harassment and assault; and in civil matters such as Qui Tam, Freedom of Information Act and unfair trade practices. She has also served as pro bono immigration counsel for political refugees seeking asylum.
Wednesday, May 6, 2009
The media is certainly focusing on the "Torture Memos," as they should. See here, here, and here. But one aspect hasn't really been discussed and that is whether there should be reconsideration of another case that involved a lawyer's opinion letter. If the torture memos are not a basis for a criminal prosecution, then can one really proceed against Ben Kuehne for his opinion letters? See here
Sunday, April 26, 2009
"Bill served as NACDL’s president from 1999 to 2000. He also served as president of the Virginia College of Criminal Defense Lawyers, now the Virginia Association of Criminal Defense Lawyers, a NACDL affiliate organization. He was a member of the bars of Virginia and the District of Columbia, the Alexandria (Va.) Bar Association, the American Board of Criminal Lawyers, and the International Association of Criminal Lawyers."
Bill, in addition to handling many high-profile cases, was also a voice for constituencies that needed a voice. (see here). He testified before Congress against mandatory minimum sentences (see here), he fought against racial injustice (see here), and always aimed for a just and fair system (see here). And despite his incredibly busy schedule, he found the time to stop and speak to law students so that they could learn from his accomplishments. He will be missed.
Sunday, April 19, 2009
The threat of indictment to a corporation is huge, and one need only look at what happened to Arthur Andersen LL.P to reach this conclusion. In the aftermath of Andersen, many corporations have entered into deferred and non-prosecution agreements with the government, paying huge fines but avoiding prosecution. With their "backs against the wall" the companies agree to many controversial terms, including in some cases the waiver of the attorney-client privilege. The net result to the government is not only money, but also evidence that can be used to proceed against individuals within the company.
But how does this scenario play out in the long run. The case of U.S. v. The Williams Companies provides an interesting glance at what can happen when the attorney-client privilege is violated by the company. Williams, an opinion issued this past week by the DC Court of Appeals has the individual asking for discovery in the criminal case, and wanting the government to produce the discovery they received from the company. The problem is that the company does not want the evidence to be produced to the defendant. So the court is left to rule on "a third-party appeal of a discovery order in a criminal case compelling the government to produce 'all materials disclosed' by the third party pursuant to its cooperation with federal investigators during a criminal investigation of the third party and others." The court remands the case to the district court to assess "which documents were material to the defense."
The moral of the story is - you may think that your back is against the wall to enter into a deferred prosecution agreement, but before you agree to waive the attorney-client privilege, be aware of the long-term ramifications of this decision.
(esp) (blogging from Chicago)