From the Sidebar - Trial, Litigation and The Practice of Law

By Hayes Hunt
and Jeffrey M. Monhait

The focus on the political consequences of the Internal Revenue Service scandal has overshadowed a troubling reality that a federal agency targeted specific groups of people for discriminatory treatment. In singling out conservative groups, the IRS reminded us that the McCarthy-era Red Scare is not the distant memory many would like to believe. However, the media's uniform condemnation of this conduct demonstrates how the world has changed since then. People do not quietly allow government abuses to occur. This political backlash may be responsible in part for the U.S. Department of Justice's criminal investigation into the IRS's actions. Civil lawsuits are being filed by affected groups. The critical question is what legal remedies are available to organizations singled out by the government for discriminatory treatment.

IRS REVIEWS APPLICATIONS FOR TAX-EXEMPT STATUS

Organizations seeking exemption from federal taxes must apply to the IRS for that classification. The IRS, in particular the Office of Rulings and Agreements, of the Exempt Organizations function, evaluates these applications. The majority of applications (70 percent in 2012) are approved without additional requests for information from the applicant. If the IRS needs substantially more information, the application is assigned to the Determinations Unit. A specialist in that unit sends the applicant a request for information, and after the information is received, the specialist issues a final determination letter approving or denying the tax-exemption application.

There are different types of tax-exempt groups. Charitable organizations may not participate in election activities. Social welfare organizations, agricultural and labor organizations and business leagues may engage in some campaign activities. Charitable organizations may only participate in "limited" lobbying, but the other groups may lobby in furtherance of their tax-exempt purposes.

IRS TARGETED CONSERVATIVE GROUPS

Last year, members of Congress and the media raised concerns that the IRS was targeting conservative groups' applications for increased scrutiny. Responding to these concerns, the U.S. Department of the Treasury inspector general for tax administration initiated an audit to investigate the IRS's conduct in reviewing applications.

The report of that review, published May 14, revealed that the Determinations Unit selected for enhanced scrutiny applications submitted by any organization with the words "Tea Party," "Patriots" or "9/12" in their names. Rather than using criteria developed based upon the tax laws and regulations, the IRS agents targeted specific political viewpoints for disparate treatment.

These practices reach back to 2010. The targeted groups were subjected to lengthy delays in the processing of their applications and often had to reply to burdensome information requests (including, in some cases, submitting donor lists). Some applications were pending for more than three years. The audit reviewed 296 "potential political cases," and although 108 had been approved and none denied, 160 cases remained open, pending for between 206 and 1,138 days. 

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By Hayes Hunt and Jonathan R. Cavalier

Most in-house lawyers, if they're fortunate, haven't bumped up against the Fifth Amendment and its related issues since the bar exam. After all, the so-called "nickel" typically arises solely in the criminal context, and corporations don't have the right to plead the Fifth Amendment at an organizational level. However, with governmental investigations of varying types on the rise, and in-house counsel advising the corporation and preparing witnesses for participation in these investigations, the Fifth Amendment and its protections are an important tool in protecting the company and its employees from self-incrimination.

FIFTH AMENDMENT FUNDAMENTALS

The Fifth Amendment to the U.S. Constitution provides, in relevant part, that "no person ... shall be compelled in any criminal case to be a witness against himself." This privilege against self-incrimination has been defined as the constitutional right of a person to refuse to answer questions or otherwise give testimony against himself or herself. To plead the Fifth, or to "take the nickel," is to refuse to answer a question from a governmental body because the response could provide self-incriminating evidence of an illegal act.

Importantly, the Supreme Court has repeatedly recognized that "a witness may have a reasonable fear of prosecution and yet be innocent of any wrongdoing. The privilege serves to protect the innocent who otherwise might be ensnared by ambiguous circumstances," as the court held in Grunewald v. United States, 353 U.S. 391 (1957). The Fifth Amendment is intended to protect "the truthful responses of an innocent witness" where the responses of such a witness might provide the government with "incriminating evidence from the speaker's own mouth," as the court held in Ohio v. Reiner, 532 U.S. 17 (2001). The privilege is thus available to both the innocent and the guilty. Importantly, the privilege protects statements that might incriminate the witness regardless of the likelihood of prosecution; rather, the witness must simply have a reasonable fear that his or her responses might self-incriminate.

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By Hayes Hunt and Michael Zabel

Let’s say one day you observe your local police officer walk a drug-sniffing police dog up to the front door of your neighbor’s house.  The dog sniffs around outside, then gives a positive signal to the officer.

Did you just witness the police conduct a search of your neighbor’s home?  The answer, according to a recent opinion from the Supreme Court of the United States, is yes.

Recently, the Court handed down its opinion in Florida v. Jardines, its second drug-sniffing dog case from last term.[1]   In Jardines, the Court held that “the government’s use of trained police dogs to investigate the home and its immediate surroundings is a ‘search’ within the meaning of the Fourth Amendment.”

The facts of Jardines are essentially what were laid out above.  Police received an unverified tip that marijuana was being grown in the home of Joelis Jardines.  Police officers approached Jardines’ home with a trained drug-sniffing dog.  The dog sniffed around the front porch area of the home and the base of the front door, and gave an alert signal indicating he had detected drugs.  On the basis of the dog’s signal, police applied for and obtained a warrant, and executed a search of Jardines’ home later that day, discovering marijuana plants inside.

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By Hayes Hunt and Jeffrey Monhait

Last month, the U.S. Court of Appeals for the D.C. Circuit in United States v. Ring, No. 11-3100 (D.C. Cir. Jan. 25, 2013), upheld a conviction for bribery under the public sector honest-services fraud statute, expanding the definitions of "corrupt payments" and "official action," and thus making it easier for federal prosecutors to secure convictions under this statute. The court, in an opinion by Judge David Tatel, held: (1) implicit quid pro quo is sufficient for a bribery conviction, and no actual agreement by the public official is necessary; (2) there is "official action" when a lawyer in the Justice Department emails a secretary with the Immigration and Naturalization Service requesting expedited review of a visa application; and (3) the trial court did not abuse its discretion under the First Amendment or Federal Rule of Evidence 403 in allowing the jury to draw an adverse inference from a defendant's history of lawful campaign contributions.

The Facts

The defendant, Kevin Ring, worked as a lobbyist for Jack Abramoff. His role included fundraising for campaign contributions and developing and maintaining relationships with public officials to serve the lobbying firm's clients. Although campaign contributions were the primary means of accessing public officials, Ring treated these individuals to dinners, drinks, travel, concerts, sporting events and other forms of entertainment. A 2004 federal investigation of Abramoff ultimately led to the prosecution of Ring. At trial, he was convicted on three counts of honest-services fraud, one count of paying an illegal gratuity, and one count of conspiracy to pay an illegal gratuity, and sentenced to 20 months in prison, the opinion said.

Lawful Lobbying vs. Corrupt Bribery

The court noted that "lobbying has been integral to the American political system since its very inception." It is an enormously influential political machine. As of 2008, there were more than 14,000 registered Washington lobbyists, and lobbying expenditures on Congress and federal agencies exceeded $3 billion. "Lobbyists serve as a line of communication between citizens and their representatives, safeguard minority interests and help to ensure that elected officials have the information necessary to evaluate proposed legislation," the opinion said.

To achieve these ends, lobbyists develop personal relationships with officials, through campaign contributions and events including, for example, dinners, drinks, concerts and sporting events. As long as gifts do not constitute bribery, lobbyists are free to use them to "curry political favor," the opinion said. The line dividing legal lobbying from corrupt bribery is crossed when a gift is tied to a particular act. (See United States v. Sun-Diamond Growers of California, 526 U.S. 398, 405-08 (1999).) In Ring, the court commented that although the "distinction between legal lobbying and criminal conduct may be subtle ... it spells the difference between honest politics and criminal corruption."

The Supreme Court set the scene for Ring in Skilling v. United States, 130 S. Ct. 2896, 2907 (2010), in construing the public sector honest-services fraud statute to cover "only bribery and kickback schemes."

'Implicit' Quid Pro Quo Is Sufficient

Ring challenged the jury instructions underlying his bribery conviction for three flaws in stating: "(1) that an explicit quid pro quo was required; (2) that the official must agree to the exchange; and (3) that, at the very least, a corrupt payment must be offered." The court rejected all three challenges.

Ring claimed McCormick v. United States, 500 U.S. 257 (1991), required an explicit quid pro quo. There, the Supreme Court required an explicit quid pro quo to criminalize campaign contributions under the Hobbs Act. Ring urged the court to extend that holding to other things of value, but the court found that, in addition to the fact that it is unclear what an explicit quid pro quo requirement would look like in practice, campaign contributions are distinguishable from other things of value. In a world where political campaigns are privately funded, public officials must solicit contributions. Free lobster tails and Rolling Stones tickets simply do not serve this same purpose. Thus, there was far less concern about "criminalizing politically necessary activity or chilling constitutionally protected speech" and the court declined to impose an explicit quid pro quo requirement.

Ring also claimed the prosecution was required to prove that the public official accepted the offer. Based on Skilling's conclusion that honest-services fraud covers only bribery and kickbacks, the federal bribery statute, 18 U.S.C. §201(b), provides background for honest-services bribery. The court commented that the bribery statute "defines two separate crimes: the act of offering a bribe and the act of soliciting or accepting a bribe." Because bribery does not require that the official accept the bribe, neither does honest-services bribery. The key to bribery is intent — the intent to affect a quid pro quo, and the intent to influence an official act. Thus, the statute is satisfied by proof beyond a reasonable doubt of "intent to offer or solicit an exchange of official action for personal gain."

Ring's final challenge to the instructions was that they failed to require that the defendant intended to offer a quid pro quo exchange. Both sides agreed this element was necessary, and the court found that the jury was properly instructed as to this element. Instructions must require, and these did, "a specific intent to influence official acts, an intent that the official realize or know that the corrupt exchange is being proposed, and a showing that the gifts were conditioned upon the official act or agreement." The court concluded that the mens rea element, rather than the conduct itself, distinguishes legal lobbying from corrupt bribery. 

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By Hayes Hunt and Michael Zabel

By now, the concept of Upjohn warnings should be familiar to any counsel, whether in-house or external, who represents a corporation's interests in an internal investigation. In a nutshell, an Upjohn warning is derived from the Supreme Court decision in Upjohn v. United States, 449 U.S. 383 (1981), and is a mechanism for establishing corporate privilege by which corporate counsel explains to the corporation's officers and employees that when the individual officer or employee provides a statement to corporate counsel in the course of an internal corporate investigation, it is the corporation — and not the individual — that holds the attorney-client privilege for that statement.

A pair of significant cases in 2012 demonstrated just how important proper documentation of an Upjohn warning can be for establishing a privilege claim.

The first case is In re Google, 462 F. App'x 975 (Fed. Cir. 2012). You probably read about the legal battle pitched last year between technology giants Google and Oracle. In February 2012, several months before a jury found that Google did not infringe on two of Oracle's patents, the U.S. Court of Appeals for the Federal Circuit ruled that an internal email by a Google engineer was not protected under Upjohn because nothing indicated that the engineer had prepared the email "in anticipation of litigation or to further the provision of legal advice."

Google had argued that the engineer's email was made at the request of in-house counsel for the purpose of investigating Oracle's infringement allegations. In support, Google offered a declaration from its counsel that the email was prepared at his request. The Federal Circuit rejected Google's argument, observing that the content of the email itself suggested that the engineer's email was a response to a request from Google management relating to Google's pursuit of a license for Oracle's patents — and not a response to a request from counsel for assistance in the infringement suit.

The second case is Custom Designs & Manufacturing v. Sherwin-Williams, 39 A.3d 372, 374 (Pa. Super. Ct. 2012). Just as in the Google case, the court in this case rejected a corporation's privilege claim under Upjohn because the record did not indicate that the disputed communication was prepared at the request of counsel. In Custom Designs, the plaintiff was a cabinet company whose building caught fire and was significantly damaged. The day after the fire, a Sherwin-Williams employee visited the site of the fire and shortly thereafter prepared two memoranda addressed to Sherwin-Williams' in-house counsel. The cabinet company later sued Sherwin-Williams, alleging that Sherwin-Williams' products had caused the fire. In discovery, Sherwin-Williams claimed privilege with regard to its employee's two memoranda to its counsel.

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By Hayes Hunt and Michael Zabel

How much evidence is enough to establish the crime-fraud exception to attorney-client privilege? With its recent opinion in In re Grand Jury, Nos. 12-1697 & 12-2878 (Dec. 11, 2012), the U.S. Court of Appeals for the Third Circuit addressed the issue in the context of subpoenas issued to the former in-house counsel of a company subject to a grand jury investigation. According to the precedential opinion, a party seeking to challenge attorney-client privilege by means of the crime-fraud exception must produce evidence demonstrating a "reasonable basis to suspect" that the elements of the crime-fraud exception have occurred. This newly announced standard clarifies Third Circuit precedent and at the same time serves to highlight the split among the federal courts of appeals over how to construe the "prima facie evidence" standard for the crime-fraud exception first articulated by the U.S. Supreme Court in Clark v. United States, 289 U.S. 1 (1933).

Every good lawyer knows, of course, that the attorney-client privilege does not offer absolute protection of his or her communications with a client. One important exclusion from the realm of attorney-client privilege is the crime-fraud exception, which, in the words of the Supreme Court, "assures that the seal of secrecy ... between lawyer and client does not extend to communications made for the purpose of getting advice for the commission of a fraud or crime." (See United States v. Zolin, 491 U.S. 554, 109 S. Ct. 2619, 2621, 105 L. Ed. 2d 469 (1989).) A party seeking to overcome attorney-client privilege through the crime-fraud exception must introduce prima facie evidence that (1) the client was committing or intending to commit a fraud or crime, and (2) the attorney-client communications were in furtherance of the alleged fraud or crime.

Federal circuit courts have offered differing articulations and conclusions over what constitutes prima facie evidence. Some courts have held that the evidence proffered must be sufficient to allow the court to require the privilege holder to come forward with an explanation for the evidence offered against the privilege. (See, e.g., United States v. Boender, 649 F.3d 650, 655 (7th Cir. 2011).) Other courts, such as Grand Jury, look for evidence that, if believed by a fact-finder, would establish the elements of an imminent or ongoing crime or fraud. A third group of circuit courts requires a reasonable basis in the evidence to believe that the attorney's services were used by the client to foster a crime or fraud. (See, e.g., In re Grand Jury Proceedings, 417 F.3d 18, 23 (1st Cir. 2005).)

In adopting the "reasonable basis" standard, the Third Circuit acknowledged that its own past pronouncements of what constitutes prima facie evidence under the crime-fraud exception had been "not particularly helpful." In Grand Jury, however, the court took care to define the contours of the "reasonable basis" standard. "It is intended to be reasonably demanding, neither speculation nor evidence that shows only a distant likelihood is enough," the court wrote. "At the same time, the party opposing the privilege is not required to introduce evidence sufficient to support a verdict of crime or fraud or even to show that it is more likely than not that the crime or fraud occurred."

The factual circumstances of Grand Jury present additional items of interest for in-house counsel. In the case, ABC Corp. (a pseudonym used by the court) and two of its principals were subjects of an ongoing grand jury investigation into an alleged criminal tax scheme. As part of its investigation, the federal government served subpoenas on three former in-house attorneys of ABC Corp. Both ABC Corp. and its former employees asserted attorney-client and work-product privileges, and the government invoked the crime-fraud exception in response. The district court then ordered the former in-house counsel to comply with the subpoenas.

Although the order was not directed at ABC Corp., the company sought immediate appeal under the Perlman doctrine, a rule established in Perlman v. United States, 247 U.S. 7 (1918), which allows a privilege holder to immediately appeal an adverse disclosure order without being held in contempt first by the court when the privileged information is in the possession of a disinterested third party, who will likely disclose the information rather than be held in contempt of court. The Third Circuit found that the former in-house attorneys were indeed disinterested third parties who would likely be unwilling to be held in contempt to protect ABC Corp.'s privilege. Applying the Perlman rule, the court therefore found jurisdiction to hear ABC Corp.'s appeal. 

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By Hayes Hunt and Thomas M. O'Rourke

When 58-year-old Ki Suk Han was pushed onto the subway tracks in New York’s Times Square Station last week, no one helped him.  This much can be seen in the photograph that appeared on the cover of the New York Post, which shows the Q train bearing down on Mr. Han seconds before his death.  The tragedy raises questions about whether the inactions of those on the platform, including the photographer who snapped a picture, constitute a crime.  The photographer, R. Umar Abbasi, claims that he accidentally got the shot as he was attempting to use his camera’s flash to alert the train operator.[1]

The failure to act can only constitute a crime if the law imposes an affirmative duty to act.  As a general matter, a person is under no legal obligation to rescue another, unless a “special relationship” exists between the potential rescuer and the person in danger.  A “special relationship” exists, for example, in situations where one person is dependent on the other (e.g., parent to minor child), or where a statute or contract imposes a legal duty to act.  This common law no-duty rule applies in almost every state, including New York.  It does not matter whether the rescue is easy or the person in need of help is in grave danger. 

This rule has been rejected in states such as Minnesota, Rhode Island and Vermont,[2]  which have adopted criminal statutes that require citizens to “give reasonable assistance” to those exposed to “grave physical harm” unless doing so would be dangerous.[3]  In Minnesota and Rhode Island, a violation of the statute is a petty misdemeanor.  In Vermont, a violation carries a fine of no more than $100 and no jail time.  It does not appear that anyone has even been prosecuted under these statutes.  David A. Hyman, Rescue Without Law: An Empirical Perspective on the Duty to Rescue, 84 Tex. L. Rev. 653, 656 n.7 (2006).        

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By Hayes Hunt and Thomas O'Rourke

On Wednesday, Rajat Gupta, former director of Goldman Sachs, will be sentenced for conspiracy and securities fraud in connection with insider trading.  Gupta is requesting a non-custodial sentence, based on his lifetime of good work and humanitarian efforts.  The prosecution is seeking 8-10 years of incarceration.  Over 200 character letters have been submitted to the sentencing judge, Jed S. Rakoff, on Gupta’s behalf. 

When the Wall Street Journal reported this outpouring of support for Gupta, people sent letters to the Court in response, seeking stiff punishment.  According to the WSJ Law Blog, Kenneth Lehrer, a former adjunct professor of finance at the University of Houston, wrote on “behalf of his former students” and to inform Judge Rakoff that “granting Mr. Gupta a very light or reduced sentence for his despicable actions would not truly balance the scales.”  Another letter came from Brian D. Walker, the founder of an executive search firm, demanding punishment and noting that “whether or not Gupta is a ‘Good Man’ is irrelevant.”

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By Hayes Hunt and Jonathan Cavalier

So how can employers implement beneficial, effective criminal background screening in their hiring processes while ensuring that they remain in compliance with the law? A few simple steps will go a long way.

1. Draft a written background check policy that complies with the law.

Any employer choosing to use criminal background checks as part of a hiring process should have a policy. The policy should be written in clear, plain language and made available to applicants. It should state that the employer will use the background check to search for criminal history that has a direct relationship to the job at issue, and that only those criminal convictions will be considered. The policy should also expressly state that the employer is an equal opportunity employer and that it will not discriminate on the basis of any protected characteristic in the use of background checks or in hiring decisions. Finally, the employer may consider providing candidates not hired because of the existence of criminal convictions the opportunity to discuss the conviction with the employer.

2. Follow the policy in performing background checks and making hiring decisions.

If an employer has a background check policy, it must be followed. All applicants for a given job should be screened. Screening must not be used selectively or on an individual basis. Doing so is a recipe for a discrimination lawsuit. The employer must also make sure that anyone involved in hiring or background screening is trained on the employer's policy and on how to implement and follow it. Interviewers should be prepared to field questions from applicants about the screening policy and what it means if an applicant has a criminal conviction. Finally, the employer must abide by the policy and only consider convictions that have a direct impact on the applicant's fitness for the particular job at issue.

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Following up on the From The Sidebar article co-authored by Jillian Thornton, Hayes Hunt had the opportunity to discuss Twitter and Facebook subpoenas with Colin O'Keefe of LXBN. In the interview, he speaks about when these sites may be forced to turn over information to the courts and what information they would give up. Also, he explains what role corporate partnerships may play as we touch on the Twitter suspension of reporter Guy Adams.

By Hayes Hunt and Jillian Thornton

955 million people are Facebook users and there are 500 million Twitter users worldwide.  With these staggering numbers, social media is a goldmine or minefield for lawyers seeking information.  What happens when a lawyer sends a third-party subpoena to Facebook or Twitter about an individual? 

The answer is Facebook and Twitter will likely object on the grounds that the production of private information would violate the Stored Wire and Electronic Communications Privacy Act (“SCA”).  The SCA prohibits an internet company from disclosing a user’s private information unless the user provides consent. Courts have thus generally held that a party cannot obtain social-media data by merely sending a subpoena to Facebook or Twitter.  

Facebook takes the position that it is prohibited by the SCA from disclosing a user’s private information, and generally asks to dismiss a subpoena that asks for private information. See, e.g., Juror Number One v. Superior Court, 206 Cal. App. 4th 854 (Cal. App. 3d 2012) (noting that Facebook moved to quash a subpoena under the SCA, and arguing that the requested information could be obtained from the user himself, who “owned” his profile information).  Facebook actually receives so many subpoena requests for user data that it currently dedicates a section of its online Help Center to answering questions about civil subpoenas. See Law Enforcement and Third-Party Matters, Facebook.

The SCA is not all-encompassing though.  For example, the SCA permits the government to compel disclosure of the basic subscriber and session information using a subpoena.  In addition, one court recently held that Twitter must produce user information in response to a criminal subpoena.  See People v. Harris, Case No. 2011NY080152, 2012 WL 2533640 (N.Y. Crim. Ct. June 30, 2012).  In Harris, the court denied Twitter’s motion to quash a subpoena to obtain a user’s information, email address, and posts for a certain time period.  Although Twitter argued that the user owns his tweets, the court held that users do not have standing to object to the criminal subpoena because the user has no proprietary interest in the information, nor does the user have a reasonable expectation of privacy in information shared with third parties.  “There can be no reasonable expectation of privacy in a tweet sent around the world.”  Id. at *3.  The court concluded that “[s]o long as the third party is in possession of the materials, the court may issue an order for the materials from the third party when the materials are relevant and evidentiary.” Id. 

You can expect to see more judges ordering Facebook and Twitter to produce “private” information in response to third-party subpoenas.

by:  Hayes Hunt and Jonathan A. Cavalier

Use of social media to explore the histories and potential biases of a jury pool is relatively new, but it is rapidly gaining in popularity. While voir dire can be an effective tool for weeding out obviously biased jurors (and those who do not want to serve), it can be difficult to get complete, detailed and truthful answers from all prospective jurors.

Social media can help. In jurisdictions where a list of prospective jurors is provided to counsel in advance, social media screening can be performed in advance and in detail, can help expose juror bias, and can help craft voir dire questions to eliminate undesirable jurors without wasting peremptory challenges. Social media can reveal work history, political affiliation, charitable activity, personal and professional relationships and affiliations, purchasing habits, hobbies, socioeconomic status and many other traits that may impact a juror's way of thinking about a case.

If the names of prospective jurors are not made available in advance, using social media can be more difficult. Certainly, attorneys cannot examine jurors' Facebook pages during active voir dire of the panel. However, counsel should consider having another attorney perform social media research on jurors during questioning. Although time constraints will prevent the attorneys from probing as wide or as deep as they could if they were able to do so in advance, even a shallow investigation might weed out a problematic juror or two who might have otherwise made it through.

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by:  Hayes Hunt and Brian Kint

Federal prosecutors in Roger Clemens’ perjury trial may have made a costly error after Andy Pettitte testified that he was “50-50” about a conversation he had with Clemens regarding his use of human growth hormone.

Under questioning from prosecutors, Pettitte testified that Clemens had told him he had used HGH.  He later testified that he might have misunderstood Clemens, and Clemens actually might have said it was his wife who had used the substance.  When asked on cross-examination if he was “50-50” that he had misunderstood Clemens, Pettitte replied, “I’d say that’s fair.”

In light of Pettitte’s “50-50” comment, the defense moved to strike the portion of his testimony regarding his conversation with Clemens as insufficiently definitive – essentially that it is too uncertain to prove anything.  Pettitte’s testimony is relevant if (a) it has any tendency to make a fact more or less probable than it would be without the evidence; and (b) the fact is of consequence in determining the action. (FRE 401)

Here, the fact of consequence is Clemens’ use of HGH.  Therefore, the substance of the conversation would be relevant and admissible if Clemens had admitted that he used HGH himself, but irrelevant if he was talking about his wife’s HGH use.  In other words, relevance – and thus admissibility – turns on the fact of whose HGH use Clemens discussed with Pettitte. 

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by:  Hayes Hunt and Jonathan Cavalier

Over the past decade, many European countries have passed laws mandating that individuals and employers report criminal conduct.  In the United States, however, individuals are typically not required to report criminal conduct that they have observed.  Likewise, employers have no general duty to report criminal conduct by their employees. 

However, not all situations are created equally, not all crimes are treated the same, and exceptions exist that may require employers to report the criminal actions of their employees.  Consider the following scenario:

 SCENARIO: A Fortune 500 company is committed to developing a family-friendly workplace.  The company has developed industry-leading flex initiatives, benefits for working mothers, and extended pregnancy and child-care leave programs.  The company has won numerous awards and is recognized as one of the best places to work for workers with children.  One of the company’s newest initiatives is an on-site, company-owned daycare center for children of employees.  One daycare staffer notices that a 5-year-old child frequently arrives at the center with suspicious bruising on his arms and legs.  What obligations does the employer have in such a situation?

All 50 states have passed laws regarding the reporting of suspected child abuse.  While some states require anyone who reasonably suspects child abuse to report it most states define certain specific groups of professionals that must report such abuse.  These groups typically include types of jobs that require regular interaction with children, like teachers, doctors, social workers and law enforcement officers.  These laws generally require the reporter to call a designated reporting hotline and provide the suspected abuser’s name and other identifying information.  Some states allow the reporter to remain anonymous.  In most states, a good faith report of suspected child abuse provides immunity for the reporter. 

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By Stephen A. Miller 

(Orig. published 7/11/11)

In the 2000 World/Subway Series, Roger Clemens hurled a broken bat at Mike Piazza.  In hindsight, we can ask: Was it “roid rage”? 

Clemens now finds himself on trial this  week in a real Washington D.C. courtroom concerning his use of performance-enhancing drugs (PEDs). 

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by Hayes Hunt and Brian Kint

An investigation conducted by the NFL revealed that a number of defensive players and coaches from the New Orleans Saints maintained a “bounty” program.   As punishment, last week the NFL suspended Super Bowl-winning New Orleans Saints’ coach Sean Payton for a year for overseeing the bounty program.  Senator Dick Durbin of Illinois is in the process of creating a Judiciary Committee to debate making bounty systems in professional sports a Federal crime. 

The Saints’ bounty program violated league rules by giving cash bonuses to players for delivering hard hits to the opposing players.  The most controversial bounties were given to players who injured key adversaries.   Players earned more cash based on the severity and effect of the injury inflicted. Thus the rewards were greater if the quarterback sustained a concussion and had to leave the game than for a hit that required a right guard to sit out a down while his ankle was taped on the sideline. 

Generally, the law shields professional athletes from civil liability for their on-field conduct through the doctrine of voluntary assumption of risk.  Each play in a football game contains numerous hits that would be considered an assault and battery outside the chalk of the field’s lines.  Sometimes, players are hurt.  The injured player cannot sue the opposing player because he accepted the obvious risks inherent in playing an NFL football game, including the risk of being hit hard. 

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By:  Hayes Hunt and Calli Varner

Computer encryption software is no longer for the technologically advanced.  This readily available software allows average computer users to transform plain text into indecipherable symbols, inaccessible to anyone without a password.  With a few clicks of a mouse, computer hard drives become impossible to break into for advanced hackers and, even, FBI cyber squads. In response to this technology, prosecutors in Colorado were recently successful in obtaining a court order requiring a woman, charged with a crime, to meet with FBI agents and unlock files found on her laptop. 

Ramona Fricosu was indicted in 2010 for bank fraud connected to what authorities allege was a mortgage scam targeting people facing foreclosure.  Prosecutors claim the scheme defrauded banks of more than $900,000.  The FBI obtained a warrant and searched Fricosu’s home, recovering several computers, including a laptop containing the encrypted information.  The FBI asked Fricosu to decode the laptop, but she, understandably, refused and invoked her Fifth Amendment right against self-incrimination.

Last month, federal judge Robert Blackburn ordered Fricosu to turn over an unencrypted version of the hard drive.  Although he recognized the long-standing legal principle that the contents of one’s mind is protected by the Fifth Amendment, Blackburn ruled that requiring Fricosu to unencrypt her laptop was not a violation of her Fifth Amendment right; Blackburn decided that the government already had evidence that she was the primary user of the laptop and they would not gain any additional incriminating evidence.  In essence, the existence of the files was a “foregone conclusion” that didn’t reveal any new information prosecutors didn’t already know. If that was true, there is little vailidity to compel her to unlock the computer for the prosecutors. The 10th Circuit Court of Appeals upheld Blackburn’s decision and the case may end up in front of the U.S. Supreme Court.    

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Contributed by Thomas Wilkinson, Jr. and Issa Mikel

In Commonwealth of Pennsylvania v. Harris, No. 8 EAP 20098 (Pa. 2011) (McCaffrey, J.), the Pennsylvania Supreme Court reaffirmed its prior rule that orders overruling claims of privilege are immediately appealable as of right under Pennsylvania law, rejecting a recent U.S. Supreme Court opinion to the contrary.

Francis Harris was found guilty of first-degree murder and sentenced to death for the killing of a witness who was scheduled to testify against him in a trial on aggravated assault charges.  After affirmance of the sentence, Harris filed a petition under Pennsylvania’s Post Conviction Relief Act.  He argued that his attorney in the criminal trial had ineffectively introduced the testimony of a psychologist hired to testify at the sentencing hearing about past psychological trauma suffered by Harris.

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By Hayes Hunt and Catherine Hamilton

Former Mississippi Governor Haley Barbour granted clemency to over 200 people prior to leaving office.  Among those receiving a full pardon were over a dozen convicted murderers and five men who worked for the Governor at his mansion. Victims’ rights advocates and the families of those slain by the convicted murderers have, understandably, voiced opposition.  Mr. Barbour’s clemency decisions involved an unusually high number of pardons for those found guilty of violent crimes, including murder, manslaughter, and rape.   Pardons are typically reserved for less violent crimes. 

Others are bothered by the Governor’s acts of clemency for the five individuals who worked for the Governor as “trusties.”  The idea of “trusties” certainly invokes historically negative stereotypes of the South and prison labor.  Think Paul Newman in Cool Hand Luke.  Those inmates lucky enough to be chosen as "trusties" to work at the Governor's mansion have an unfair opportunity to garner favor in an effort to strengthen their chances for a pardon. Barbour considered his pardons for the trusties to be appropriate based on "tradition."

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By Hayes Hunt and Brian Kint

The Army has charged eight soldiers in connection with the death of fellow soldier, Private Danny Chen.  Allegedly, these soldiers threw rocks at Private Chen, taunted him with ethnic slurs, and made him do pull-ups with a mouthful of water.  Later that evening, Private Chen was found dead in a guard tower with “an apparent self-inflicted gunshot wound.”  The Army charged the eight soldiers with manslaughter and negligent homicide even though Private Chen’s death was an apparent suicide.  Such charges in these circumstances raise interesting questions of culpability and criminal causation.

Generally, the law will hold a defendant criminally accountable for homicide only when the defendant’s actions are the proximate cause of the victim’s death.  Say, for example, you push someone off a bridge.  Here, the connection is easy to make because your actions are the direct cause of the victim’s death.  Such a case exists in the alleged hazing death of Florida A&M University drum major Robert Champion, where the victim’s death resulted from the physical injuries sustained during a brutal hazing episode. 

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Originally published in the Champion, November, 2011

The Client Has Been Accused of What Crime?

It is essential to know what hap­pened both from the client's perspective and from the government's point of view. Before the attorney starts, she should explain the potential defenses to the charged c^•ime such as identification, alibi, self-defense, suppression of evidence, unintentional conduct, a mistake, and the credibility of government wit­nesses. The attorney wants the client fil­tering and aware of the defenses as he relates the facts to her.

Counsel must take her time and obtain all the facts from the client. She should exhaust every fact about every witness, the physical scene, computer data, phone calls, documents, a time­line of pertinent events, and any poten­tial bias of the complainant or the cooperating witnesses. If the charges involve multiple counts; it is best to deal first with lead charges (i.e., con­spiracy to do X). The government believes X is true because of a cooperat­ing witness or the circumstances of the client's arrest. The attorney should use this language throughout the interview: "the government thinks" and "the police are saying." The government is unlikely to change that point of view, at least for now.

Who Is the Client?

Counsel needs to create an in­depth profile of the client. The attor­ney will be funneling her client's life history into defense theories, investiga­tion, and if need be, mitigation for a negotiated plea agreement or sentenc­ing. She must understand the client's educational background, employment history, and relationship with his fam­ily. Furthermore, defense counsel must know the client's medical (physical and psychological) history, and any drug or alcohol problems and treatment. Counsel should find out whether the client is involved with any charities, religious organizations, or the local community. In addition, counsel should take detailed notes about the client's physical characteristics includ­ing height, weight, age, and race. She should note any identifying scars, tat­toos, or unique physical attributes that may relate to an identification defense. Does the client have any prior arrests and convictions? If none, counsel should ask about character witnesses that know the client well and make sure these people have good communi­ty credentials. Good character witness­es include business leaders, the PTA president at the school the client's chil­dren attend, and members of the cler­gy. If the defense attorney does not know her client, the ju^•y and judge will not know him.

Arrested Development

Was the client arrested at the time of the charged offense or was an arrest warrant issued? What items did police officers seize and how? Were other peo­ple present who may be witnesses to the arrest or search and seizure? The lawyer should explain the basics of suppres­sion, probable cause and reasonable sus­picion, and how they relate to the exclu­sionary rule. What did the client say at the time of arrest and did he give a state­ment after his arrest (Miranda issues)? If so, defense counsel needs every fact about the circumstances of any state­ment. Was the client handcuffed? How many police officers were present? What questions did they ask that may have elicited an incriminating response from the client?

If the case clearly depends on iden­tification, the lawyer must find out whether the client knows the com­plainants, and if not, whether there was a lineup or a showup at the time of the arrest. Counsel should make sure he preserves any identification defense.

Counsel should tell the client that he may need him to wait in the parking lot at the next court date while counsel requests a lineup.

Guilty or Not Guilty?

At this point, counsel should have gained the client's trust. Typically, coun­sel will suggest that the client plead "not guilty" as there have not been conversa­tions with the government. If the attor­ney has been meeting with people in the Attorney General's Office, they have decided to proceed against the client and a criminal information is off the table. A grand jury has already indicted the client, so the prosecutor will be hard pressed to veto the grand jury's deci­sion. Defense counsel should explain tohis client the importance of retaining an investigator and, if needed, a psycholo­gist or addiction-treatment counselor. Counsel should let the client know he has a dual defense strategy: one related to the alleged criminal conduct and the other to mitigation.

My entire article was published in the 11/11 issue of The Champion published by the National Association of Criminal Defense Lawyers.

By Thomas G. Wilkinson, Jr. and Michael P. Zabel

Can joint representation with independent counsel remedy a conflict of interest? In a recent criminal case in the U.S. District Court for the Western District of Pennsylvania, a federal judge denied the public defender’s request to withdraw over a conflict of interest from a prior representation and instead ordered the public defender to obtain separate counsel who could independently manage any claimed conflict. When later accused of bias against the defender’s office, the judge voluntarily recused himself from 17 ongoing criminal cases.

Conflict, Withdrawal, and Independent Counsel
The dispute over the alleged conflicts arose in United States v. Vue,No. 2:09-00048 (W.D. Pa. Sept. 20, 2010), a case in which the Federal Public Defender (FPD) had been appointed to defend Youa Vue, a convicted felon who was indicted for possession of a firearm. When the FPD learned that it had formerly represented the confidential informant whose information was used to obtain the search warrant for Mr. Vue’s home, the FPD sought permission in consecutive motions to withdraw from the case, claiming that its representation of Mr. Vue would conflict with its former representation of the informant.

Judge Arthur J. Schwab denied both motions, finding that neither motion was “specific or illuminating with regard to the nature of alleged conflict, nor did it set forth any particulars about the former representation . . . and how that might conflict with the representation of Mr. Vue.” As a protective measure, the judge ordered the FPD to secure, as part of a joint representation effort, separate counsel who could represent Mr. Vue with regard to areas in which the FPD had a conflict of interest. Judge Schwab further observed that the FPD had a safe harbor in Pennsylvania Rule of Professional Conduct 1.16(c), which states that “[w]hen ordered to do so by a tribunal, a lawyer shall continue representation notwithstanding good cause for terminating the representation.”

The Interests of Criminal Justice
In rejecting the FPD’s requests to withdraw or to stay the proceedings against Mr. Vue pending appeal, the judge also criticized “a certain few [assistant federal public defenders’] increasingly common practice of filing numerous, boilerplate motions for extensions of time,” which, in at least one prior case involving the FPD, had kept a criminal defendant incarcerated for a longer period than his actual sentence required. Judge Schwab noted that in the Vue case, the FPD had filed nine motions for time extensions over a period of almost a year, threatening Mr. Vue’s and the public’s right to a speedy trial, and that further delays ran a similar risk of Mr. Vue serving time beyond his sentence.

The presence of independent counsel (without withdrawal by the FPD), the judge found, therefore not only protected the FPD against breach of its professional duty but also protected the defendant’s rights and served the interests of justice by allowing sentencing to proceed more quickly.

Prophylactic Recusal
After Judge Schwab denied its requests to withdraw, the FPD filed motions in 21 other criminal cases being presided over by the judge. The FPD requested that Judge Schwab recuse himself from the cases because of alleged bias shown by the judge in the Vue case against the FPD office. In his initial response, Judge Schwab offered to recuse himself from those cases, provided that the FPD submit an affidavit from each defendant that the defendant had read and approved the FPD’s request. The U.S. Attorney’s Office requested that the judge reconsider.

In subsequently ruling on the motions for disqualification, Judge Schwab looked to 28 U.S.C. § 455, the statute governing disqualification of federal judges, and found that “no reasonable observer … would find any bias or lack of impartiality . . . toward the [FPD] or any of the dedicated and professional Assistant Public Defenders in that Office, let alone toward any of their clients.” Lack of bias notwithstanding, Judge Schwab also held that the circumstance “calls for unusual measures to prevent what has real potential to disrupt the fair and orderly administration of justice.” The judge then voluntarily recused himself from 17 of the 21 cases, and from all future criminal cases involving the FPD through the end of 2011.

In three of the four cases from which the judge did not recuse himself, he found it against public interest and the “prudent use of judicial resources” to do so. Appeals in those three cases are currently pending before the Third Circuit Court of Appeals; all three appeals concern, in part, the denial of the FPD’s motions to disqualify. In the fourth case, new counsel was appointed for the defendant and the FPD was allowed to withdraw.

Thomas G. Wilkinson, Jr. is a member of Cozen O'Connor's Commercial Litigation Practice Group and heads the firm’s alternative dispute resolution practice. He concentrates his practice in business litigation, business torts, complex insurance coverage, and professional responsibility matters.

In an effort to deal with the ever increasing misuse of social media at trial, the California Legislature amended the criminal contempt definition to include juror misconduct as outlined below.

•  CA Assembly Bill 141.  Signed into law by Gov. Brown on Aug. 5, 2011.  Amends Sections 611, 613, and 1209 of the Code of Civil Procedure and Sections 166, 1122, and 1128 of the Penal Code.
  
  
  • Courts must remind jurors “that the prohibition on research, dissemination of information, and conversation applies to all forms of electronic and wireless  communication.”
  • Contempt of court includes “[w]illful disobedience by a juror of a court admonishment related to the prohibition on any form of communication or research about the case, including all forms of electronic or wireless communication or research.”
  • Makes a misdemeanor:  “Willful disobedience by a juror of a court admonishment related to the prohibition on any form of communication or research about the case, including all forms of electronic or wireless communication or research.”
  • Makes violations of the revised statute punishable by up to six months of jail time for criminal contempt.

On Friday, 3 men pleaded guilty to first and second-degree murder of 3 children but, minutes later, told the judge they were innocent of the same crime. This unique and rare plea agreement, called an Alford plea, enables a defendant to admit guilt while denying responsibility. What makes this case unique is that one of the defendants was previously sentenced to death for the crime and the other two were serving life sentences without the possibility of parole. They had been incarcerated for over 18 years. On Friday, they were re-sentenced with credit for time-served and walked out of the courtroom free men.

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By Lauren A. Tulli

Recently, the FDA released guidelines titled the “Special Procedures and Considerations for Park Doctrine Prosecutions” to clarify the mechanism by which enforcement actions can be brought against corporate executives of FDA regulated companies.   Although the guidelines are non-binding, they illustrate the government’s apparent commitment to punish corporate executives as individuals, for violations of the Food Drug and Cosmetic Act (FDCA). 

The threat of criminal enforcement is not new.  In United States v. Park, 421 U.S. 658 (1975), the Supreme Court affirmed a criminal conviction of a company officer for regulatory violations in a food storage facility.   The defendant denied he had any knowledge of the conditions, but the Court held that liability under the enforcement statute (21 U.S.C. § 331(a)) did not require a showing of knowledge or participation in the violation. 

The “responsible corporate officer doctrine,” also known as the Park doctrine following this 1975 case, permits charges against high ranking individuals for violations of the FDCA.  A corporate official may be convicted of a violation without engaging in any wrongdoing or knowledge of the violation, provided that the official had the authority or ability to prevent or correct the violation and failed to do so. 

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Most judges, lawyers and anyone that watched an episode of Matlock would suggest that judicial rulings are based solely on law and facts. After all, Justice is blind, and an objective Judiciary must apply facts to the law and render an impartial and unbiased decision.  The Economist's column, "The Science of Justice," discussed the findings of a study by Professors Shai Danziger, PhD in Cognitive Neuroscience, and Jonathan Levav, PhD in Marketing that researched extraneous factors in judicial decision making.  They found some startling information.

In order to test whether judges are prone to external influence, Danziger and Levav tested the age-old saying that "justice is what the judge ate for breakfast."

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Recently, GlaxoSmithKline agreed to pay $750 million to resolve criminal and civil charges brought by the Department of Justice (DOJ).  The case centered on the sale of contaminated products which were manufactured at a factory located in Puerto Rico.  As a result of the settlement, the whistleblower-former employee who provided information to the DOJ stands to be paid $96 million.  In terms of costs, the corporation paid a significant price for poor manufacturing procedures in not only the settlement amount but a drop in stock prices and possibly the confidence of patients and the government.  Similarly, the DOJ paid a king's ransom to a fact witness with credible information.  Everyone paid a premium for information that was valuable.  One thing is certain, the price of that information should have been substantially less at the time it was first provided.  How much and who should pay?   

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