New Leadership at the Department of Justice
After months of political wrangling, the Senate finally
confirmed Loretta Lynch to be the 83rd attorney general.
(There's no shortage of news coverage of this, so if you want
to read more, click here.)
DOJ Reins in Asset Freezes in Structuring Cases
In the waning days of his tenure, former Attorney General Eric
Holder announced a new policy regarding the use of
asset forfeiture for structuring offenses. By way of background,
financial institutions must report any cash deposits over $10,000.
"Structuring" is breaking up cash into
smaller amounts to evade that reporting requirement. When a
financial institution suspects structuring, it must file a
suspicious activity report, which can lead to a criminal inquiry.
The policy change Attorney General Holder announced is that
criminal or civil forfeitures for structuring will be restricted
until after a target has been charged criminally or found to have
structured. Under the new policy, a prosecutor must obtain
supervisory approval to initiate an asset freeze for structuring
and may do so only after developing probable cause that a crime has
been committed.
Apprendi Doesn't Apply to
Restitution
The U.S. Court of Appeals for the Second Circuit addressed in United States v. Bengis whether the
Supreme Court's rule in Apprendi v. New Jersey applies
to restitution orders. Apprendi held the Sixth Amendment
requires that "[o]ther than the fact of a prior conviction,
any fact that increases the penalty for a crime beyond the
prescribed statutory maximum must be submitted to a jury, and
proved beyond a reasonable doubt." In other words, a judge
cannot increase a statutory maximum by finding at sentencing facts
that increase the crime's penalties. In Bengis, the
defendants pleaded guilty to violating the Lacey Act by illegally harvesting rock lobsters
from the territorial waters of South Africa. The defendants claimed
that because their plea agreements did not specify the value of the
lobsters they illegally imported, the orders of restitution could
not be based on the value of those lobsters. The Second Circuit
rejected that argument out of hand, holding that the restitution
statutes "specify no maximum restitution amount," so
"a judge cannot find facts that would cause the amount to
exceed a prescribed statutory maximum." The court concluded
that "judicial factfinding to determine the appropriate amount
of restitution under a statute that does not prescribe a maximum
does not implicate a defendant's Sixth Amendment
rights."
Bonds Conviction Is Going, Going, Gone
The en banc Ninth Circuit in United States v. Bonds limited the reach of the obstruction-of-justice statute. The defendant, Barry Bonds, was a Major League Baseball player who was caught up in the investigation of steroid use. Bonds testified in the grand jury, and the prosecutors charged him with violating 18 U.S.C. 1503 in light of his having given "a rambling, non-responsive answer to a simple question." After being convicted, Bonds appealed. The en banc court issued a two-paragraph per curiam decision, vacating his conviction because there was insufficient evidence that the statement was "material." The court also held that the Double Jeopardy Clause prevents a retrial. Four separate concurrences lay out varying rationales for vacating the conviction. While there is no clear rule readily drawn from this case, in light of the split, the key takeaway appears to be some limitation to the bounds of section 1503. What it is and why, however, is not altogether clear.
Judge Blasts Prosecutors for "Misguided Prosecution"
U.S. District Judge Charles Breyer of the Northern District of
California dismissed the indictment against Mauricio Siciliano and
two co-defendants who were charged with mail and wire fraud in
connection with allegations of bribery of other foreign nationals
in their roles with the International Civil Aviation Organization
(ICAO), a United Nations agency based in Canada. The only
connection to the United States was the fact that the U.S.
Government is a major funding source for the ICAO. The alleged acts
of impropriety were all claimed to have occurred abroad, and no
defendant is a U.S. national. Judge Breyer found an insufficient
nexus for U.S. jurisdiction under these statutes, upbraided the
prosecutors for bringing the case, and dismissed the indictment.
(Day Pitney was co-counsel for Mr. Siciliano and participated in
briefing and formulation of the motion to dismiss.) For more on the
case, click here.
Government Can Raise New Legal Argument After Losing Suppression
Motion
The Tenth Circuit in United States v. Huff held that a
district court may reconsider a motion to suppress if the
government "initially failed to set forth" a legal basis
for the seizure but later raises one. During a routine traffic stop
in Kansas City, officers saw a handgun underneath the back of the
driver's seat. When it appeared Dana Huff, the driver, was
going to put the car into gear and drive away, one officer reached
into the car and took the keys. While doing so, he noticed a rifle.
The officers removed and cuffed the driver and passenger. Huff was
ultimately charged with being a felon in possession of a firearm.
He moved to suppress the guns, arguing the officers lacked
reasonable suspicion to search the car and lacked probable cause to
arrest him. The district court rejected the first argument but
suppressed the guns, holding that "at the time of the arrest
the officers had found no evidence of any legal violation"
because they had not asked any questions before making the arrests,
and possessing firearms is not per se unlawful. Two days later, the
government filed a motion for reconsideration, arguing it had
failed to cite the Kansas law that makes transporting a handgun
unlawful. The court reversed its prior order, the case went to
trial, Huff was convicted and he appealed. The Tenth Circuit agreed
with the majority of the other courts of appeals and held that
"the district court . . . should be permitted . . . to
determine whether its earlier suppression of evidence should stand
in light of the newly raised legal basis for the initial
seizure."
Prosecutors Might Be Held to a Higher Standard Than
Brady
The District of Columbia Court of Appeals (the highest appellate
court in the District) in In re Kline held that a prosecutor
could violate Rule 3.8(e) of the D.C. Rules of Professional Conduct
even if he complied with his obligations under Brady v.
Maryland. Rule 3.8(e) "prohibits a prosecutor in a
criminal case from intentionally failing to disclose to the defense
any evidence or information that the prosecutor knows or reasonably
should know tends to negate the guilt of the accused." The
disciplinary board had recommended a 30-day suspension for a
prosecutor who had not turned over some exculpatory evidence. The
prosecutor claimed he did not violate the rule because he complied
with his ethical obligations under Brady and its progeny.
(Brady requires prosecutors to turn over information that
might be material to the outcome of the criminal trial.) The court
rejected that claim, noting that an "interpretation of Rule
3.8(e), which incorporates a retrospective materiality analysis, is
not the appropriate test for determining whether a prosecutor has
violated" Rule 3.8(e). The court vacated the sanction on this
prosecutor because of "the confusion regarding the correct
interpretation of a prosecutor's obligations" under Rule
3.8(e).
Petraeus Perjury Punishment: Probation
David Petraeus was sentenced to two years' probation and fined $100,000 for leaking classified information to his mistress. The sentence was somewhat preordained because of the terms of the plea agreement. Former Attorney General Holder received a fair amount of criticism for agreeing to allow Petraeus to plead to an agreement that did not call for prison time. For more, click here.
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