Sunday, September 28, 2014

Former Execs From Wellcare Move to 11th Circuit

Former Wellcare executives, who were convicted, have filed their briefs in the 11th Circuit and a strong amici brief is accompanying them.  One of the key issues comes from an 11th Circuit case United States v. Whiteside, where the court held that a false statement charge can't be premised on a statement that is true under an objectively reasonable interpretation of the law.  The importance of the falsity of the statement is a key component of a prosecution as without this limitation prosecutorial discretion can be stretched to inordinate lengths.

An equally important issue argued pertains to willful blindness. The Supreme Court's opinion in Global Tech emphasizes the importance of an affirmative act needed for demonstrating willful blindness and how recklessness and negligence will not suffice.

These issues raise important questions for the 11th Circuit to examine.  It is therefore no surprise to see some top criminal law professors signing onto the amici brief.

Behrens Brief - Download Behrens_Brief_-_Filed_Copy

Farha's Brief - Download Farha_Brief_2014 09 19-1

Clay's Brief - Download Clay_Brief_-_Filed_Copy

Amici Brief - Download NACDL___US_v_Clay_-_Brief_for_Amici_Curiae_9-26-14-1

(esp)

September 28, 2014 in Judicial Opinions | Permalink | Comments (0) | TrackBack (0)

Friday, September 26, 2014

Departure of Eric Holder - From a White Collar Crime Perspective

Yesterday's announcement that Attorney General Eric Holder will be stepping down from his position makes one think back about all that he accomplished while in office.

Many have been critical of his handling of white collar cases, but few have focused on the enormous number and amount of fines given to entities during his term. There has been a growing list of deferred and non-prosecution agreements entered into between entities and the DOJ (see here).  Internal investigations are becoming routine by companies and hopefully corporations are realizing the cost-benefit of monitoring employees to adhere to the law.

Although discovery issues have not been resolved, there is certainly more focus by this Office on the importance of making sure that favorable evidence is given to defense counsel. With more time, emphasis and some new legislation this issue could move even further ahead.  

Most recently we see that DOJ is taking the ethical position in rethinking its position on waivers with guilty pleas. (see here)  Some districts, unfortunately, were asking for plea waivers on ineffective assistance and prosecutorial misconduct claims.  This practice, used by only some offices, suffered from ethics problems causing some states, like Florida, to have to issue an ethics opinion prohibiting this practice.  It is nice to see DOJ stepping to the plate to stop this conduct.  

And recently we have also seen that AG Holder has been at the forefront of enforcing the Sixth Amendment Right to Counsel. A good number of state attorney generals stood up to take this position in Gideon v. Wainwright, filing an amicus brief in support of the right to counsel for indigent defendants.  AG Holder's stance on this has been admirable.

Clearly our criminal justice system needs a good bit more work, but it is promising to see what one Attorney General has accomplished. Let's hope his successor continues advocating as a "minister of justice."

(esp) 

September 26, 2014 in Deferred Prosecution Agreements, Prosecutors | Permalink | Comments (0) | TrackBack (0)

Thursday, September 18, 2014

Appellate Court Reverses Conviction Based on Last-Minute Prosecutorial Provision of Brady Material "Buried" in Mass of Discovery

Two of the many issues relating to prosecutorial disclosure of Brady material are the timing of the disclosure and the identification of the material as exculpatory.  Many, perhaps most, prosecutors believe that they have satisfied their ethical and constitutional obligations under Brady by providing the exculpatory material just before trial (or before the witness affected testifies) without any specification that it is Brady material.  Courts rarely -- almost never -- reverse a conviction because the Brady material was provided late or without any signal that it is exculpatory material.

In this connection, yesterday an intermediate New York appellate court in Brooklyn upon an appeal of a denial of a post-conviction motion unanimously reversed a kidnapping conviction because of the untimely disclosure of Brady material in a "document dump" on the eve of trial.  The prosecutors there had during jury selection delivered the documents "interspersed throughout a voluminous amount of other documentation, without specifically identifying the documents at issue at the time of delivery," thereby, said the court, "burying" them.  By doing so, the prosecution "deprived the defendants of a meaningful opportunity to employ that evidence during cross-examination of the prosecution's witness."  People v. Wagstaffe, A.D.3d -- (2d Dept., Sept. 17, 2014).  See here.

The prosecution's case was based exclusively on the testimony of a witness under the influence of drugs and alcohol at the time of the event who testified that she saw the defendants force the 16-year old victim into a car.  The documents, police requests for records for both defendants, would have revealed that the defendants were being investigated one day prior to the initial police interview with the witness, contrary to the testimony of one of the investigating officers that the interview led them to the defendants.  Thus, the documents, said the court, would "bear . . . negatively upon the credibility of [the witness] and the investigating detectives," issues of "primary importance in this case."

Too often appellate courts, often while giving lip service to the notion that Brady material should be provided to the defendant in time for him or her to use in a meaningful fashion, accept the view that a few minutes before cross-examination is sufficient, or that the defense lawyer's failure to request an adjournment is fatal to the defense appeal.  Too often courts distinguish between Giglio impeachment of witness material and other Brady material and accept that it is acceptable that the former be given as late as just before cross-examination.  Too often courts expect defense counsel to find the Brady "needle in a haystack" in a pile of discovery or 3500 material provided shortly before trial.

It is refreshing for an appellate court to accept the practicality that a harried on-trial defense lawyer cannot be expected to appreciate immediately the significance of a single item or a few items of paper provided at the last-minute and/or together with a mass of other less significant documents.  It is refreshing for a court not to accept the prosecutorial tactic or custom to provide a "document dump" to conceal a page or a few pages of significant exculpatory material. 

Hopefully, this decision will be affirmed on appeal (if taken or allowed) to New York's highest court, the Court of Appeals, and will be a bellwether for other courts, and not ignored or consigned to history as an aberrant decision of an intermediate appellate court.

(goldman)

September 18, 2014 in Defense Counsel, Judicial Opinions, Prosecutors | Permalink | Comments (0) | TrackBack (0)

Monday, September 15, 2014

Upcoming ABA CJS International White Collar Crime Institute

I wanted to alert readers to the upcoming 3rd Annual American Bar Association Criminal Justice Section White Collar Crime Institute.  This one and a half day event will occur in London, UK at the offices of Berwin Leighton Paisner (Adelaide House, London Bridge) from October 13-14, 2014.  This has been a wonderful event in past years and this year's program looks outstanding.  The conference will bring together panelists and participants from around the globe to talk about issues including corporate espionage and cybercrimes, international money laundering and sanctions, cross-border evidentiary concerns, whistleblowers, deferred prosecution agreements, and international internal investigations.  Further, special focus will be paid to fraud and bribery cases from the perspective of top prosecutors from various countries.

On Monday, October 13, we will also welcome Michael J. Garcia as our keynote luncheon speaker.  Mr. Garcia is a partner at Kirkland & Ellis LLP in New York City.  He serves as the Independent Chair of the Investigatory Chamber of the FIFA Ethics Committee.  Prior to joining Kirkland & Ellis LLP, he served as the Senate-confirmed United States Attorney for the Southern District of New York (SDNY).  Mr. Garcia spent two years as Assistant Secretary for Immigration and Customs Enforcement at the Department of Homeland Security.  From 2001 to 2002, Mr. Garcia served as Assistant Secretary of Commerce for Export Enforcement.  From 1992 to 2001, Mr. Garcia was a federal prosecutor with the SDNY.  He personally prosecuted a number of high-profile terrorism cases, including the 1993 bombing of the World Trade Center and the 1998 bombing of U.S. embassies in East Africa.

I will be leading a discussion panel on Monday addressing the issue of collateral consequences.  This is a significant issue for all defendants, including individuals and corporations charged with white collar offenses.  The panel will examine the growth of collateral consequences in the United States, in the United Kingdom, and around the globe.  We will also discuss current trends in this area and examine the most important collateral consequences for consideration during white collar criminal investigations and prosecutions.  It should be a great conversations, and I look forward to being joined on the panel by Amanda PINTO QC (Barrister at 33 Chancery Lane, London); William N. SHEPHERD (Partner at Holland & Knight, West Palm Beach, FL), Joe D. WHITLEY (Chair, White Collar Crime and Government Investigations Group, Baker Donelson, Atlanta, GA), and Roger A. BURLINGAME (Kobre & Kim LLP, London, UK).

I hope to see some of you there.

(LED)

September 15, 2014 | Permalink | Comments (0) | TrackBack (0)

Monday, September 8, 2014

Criminalizing the American Company – The Economist

The Economist has an excellent article examining the criminalizing of American companies.  The piece, entitled “A Mammoth Guilt Trip,” covers a lot of ground, including many of the most pressing issues in the field of corporate criminal liability today.  The article begins by examining some of the incredible financial settlements we’ve seen this year.  As the piece notes, while the $5.5 billion the DOJ collected in direct payments in 2013 was impressive, it will certainly be “dwarfed by this year’s tally.”  Also examined in the article are issues such as the questionable and opaque ways the government spends settlement funds, the growth in regulatory crimes, the often prohibitive costs of corporate compliance, the inability of many companies to risk proceeding to trial, and, of course, the lack of individual prosecutions following the 2008 financial collapse.  Finally, the article contains some great data from Professor Brandon Garrett at the University of Virginia Law School.  Professor Garrett maintains a list of government actions against corporations since 2000.  In total, the list contains information regarding 2,163 corporate convictions and guilty pleas, along with 313 deferred and non-prosecution agreements.  It all makes for a fascinating read.

(LED)

September 8, 2014 in Deferred Prosecution Agreements, Prosecutions, Settlement | Permalink | Comments (0) | TrackBack (0)

Wednesday, September 3, 2014

Wine Fraudster Gets Ten-Year Sentence

Last month Prof. Douglas Berman reported in his indispensable Sentencing Law and Policy blog about a ten-year prison sentence imposed by SDNY judge Richard Berman upon defendant Rudy Kurniawan, who had sold counterfeit wine to the very rich, including billionaire William Koch (one of the less political Koch brothers), and allegedly profited by over $28 million (see here by scrolling down to August 10, "Can wine fraudster reasonably whine that his sentence was not reduced given wealth of victims?"  See also here).  Some of the ersatz wine sold for as much as $30,000 per bottle.

Having a somewhat perverse sense of humor, I found it somewhat amusing that the 1% paid astronomical sums for and presumably sometimes drank the same wine that the other 99% of us drink.  However, neither the judge nor the prosecutor (nor certainly the defendant and his lawyer) viewed the sentencing proceeding as a laughing matter.

To be sure, a $28 million fraud is a serious matter deserving serious punishment.  Additionally, the judge seemed to view the crime in part as a public safety violation, declaring "The public at large needs to know our food and drinks are safe, -- and not some potentially unsafe homemade witch's brew," even though this was hardly a contaminated baby food case.

At the sentencing hearing, Kurniawan's attorney argued, reasonably I believe, that his client should be treated somewhat less severely since the victims were exceedingly wealthy.  That argument provoked the prosecutor to the Captain Renault-like response that it was "quite shocking" for a lawyer to argue for a different standard for theft from the rich than from the poor.

That retort reminded me of Anatole France's immortal line (although not directly on point), "The law, in its majestic equality, forbids rich and poor alike to sleep under bridges, beg in the streets or steal bread."  In my view, a sentencing judge should certainly consider in sentencing the extent of damage to the victim(s).  A fraudster who steals a million dollars from a billionaire, notwithstanding the Sentencing Guidelines' overemphasis on absolute figures, should (all things being equal) not deserve as harsh a sentence as one who steals the same amount if it were the entire life savings of a senior citizen.

Prosecutors, when fraud victims are pensioners and widows, argue, I believe reasonably, that the judge should consider the degree of suffering of the victims.  Indeed, every seasoned white-collar trial lawyer knows that in a multi-victim fraud case the government is likely to call as "representative" witnesses those most sympathetic victims for whom the monetary loss was most damaging.

I assume that the prosecutor will get over his "shock" when he prosecutes a fraud case where a less than affluent victim's life savings are stolen.  I further assume he will not argue that the judge should impose the same sentence she would if the victim were a billionaire for whom the loss figure might be pocket change.

(goldman)

September 3, 2014 in Defense Counsel, Food and Drink, Fraud, News, Prosecutors, Sentencing | Permalink | Comments (0) | TrackBack (0)