«OBSTRUCTION OF JUSTICE _ White-collar prosecutors are increasingly electing to rely on obstruction charges in high-profile cases such as the criminal ...»
OBSTRUCTION OF JUSTICE
White-collar prosecutors are increasingly electing to rely on obstruction
charges in high-profile cases such as the criminal prosecutions of Frank Quattrone
(former star banker for Credit Suisse First Boston), Andrew Fastow (former CFO of
Enron), Martha Stewart, Sam Waksal (founder of ImClone Systems), Arthur
Andersen LLP, and I. Lewis “Scooter” Libby (the former Chief of Staff for Vice President Cheney). The federal criminal code gives prosecutors a tremendous selection of statutes to work with in pursuing such cases, including 18 U.S.C. '' 1503 (Influencing or injuring officer or juror generally), 1505 (Obstruction of proceedings before departments, agencies, and committees), 1512 (Tampering with a witness, victim, or an informant), 1519 (Destruction, alteration, or falsification of records in federal investigations and bankruptcy), and 1520 (Destruction of corporate audit records).1 The potential activities covered by these (and other) sections of the Code are wide-ranging. Because those provisions relating to obstruction by threat of force or physical coercion are not generally relevant to our subject-matter, this chapter focuses on the two provisions traditionally used in white-collar cases: the “omnibus” clause of ' 1503 and the non-coercive witness tampering prohibitions in ' 1512(b).
Brief coverage is given to a less frequently invoked statute, ' 1505, which has been used where obstructive activity takes place in the context of federal agency and congressional investigations and proceedings. Finally, Congress=s additions to the code in the Sarbanes-Oxley Act of 2002,2 18 U.S.C. '' 1512(c), 1519, and 1520, are discussed and compared with the protections already embodied in sections 1503, 1505, and 1512(b).
Examining the post-2002 state of the criminal code should illustrate that obstruction is an area where statutes are often enacted in response to specific problems—such as, most recently, the destruction of Enron audit records by Arthur Andersen personnel and the resultant prosecution and conviction of Arthur Andersen. As a result, the code is fairly incoherent, often redundant, and 1 See also 18 U.S.C. ' 1510; id. ' 1516 (outlawing endeavors to obstruct or impede a federal auditor); 26 U.S.C. ' 7212(a) (prohibiting corrupt endeavors to obstruct and impede the due administration of the Internal Revenue laws).
2 P.L. 107B204, 116 Stat. 745 (2002).
327 328 OBSTRUCTION OF JUSTICE Ch. 6 overbroad—leaving much to the discretion of prosecutors. It is also very difficult to master. Accordingly, to assist students in working their way through these materials, charts comparing the elements of some of the most commonly used statutes are included throughout this chapter.
Section 1503’s “omnibus clause” has been applied to sanction a great variety of non-coercive obstructive activity, including: false statements made to federal agents;
false testimony before a grand jury or trial court; refusing to testify before a grand jury after immunity has been conferred; knowing concealment, falsification, or destruction of evidence to be submitted to a grand jury or court; and efforts to alter the testimony of witnesses for corrupt purposes. It has also been used to pursue conduct that is not perhaps as intuitively categorizable as “obstruction,” including a grand juror's or others' unauthorized disclosure of grand jury information and lawyers= efforts to obtain monies from criminal defendants by false promises to “fix” the proceedings or pay off criminal justice officials.
Until Congress amended ' 1512 in 2002, that statute was more narrowly focused on witness tampering, such as defendants’ efforts to compromise physical evidence or the testimony of prospective witnesses. Among other changes made in the Sarbanes-Oxley Act of 2002, Congress added a very broad obstruction prohibition in ' 1512(c) which mimics in major part ' 1503’s omnibus provision but which is applicable in contexts outside of the judicial proceedings that ' 1503 protects, such as in proceedings before federal agencies and in congressional inquiries. Congress also added a whopping potential penalty for violations of ' 1512(c), meaning that ' 1512(c) may in the future eclipse ' 1503 where applicable.
As these materials highlight, one of the interesting questions presented by these statutes is the degree to which otherwise legitimate legal advocacy or advisory activities may be pursued as obstruction under sections 1503, 1505 or 1512(c) or as witness tampering under ' 1512(b). Two of the cases examined within, United States v.
Cueto and the Supreme Court=s decision in Arthur Andersen LLP v. United States, are relevant to these questions. Materials relating to the apparent theory upon which the jury convicted Arthur Andersen in its recent obstruction case—relating to the work product of in-house counsel—are also included as a case study on the website that supports this book, http://www.federalwhitecollarcrime.org.3
A. THE “OMNIBUS” CLAUSE OF 18 U.S.C. ' 1503
“[T]he purpose of ' 1503 is to protect not only the procedures of the criminal system but also the very goal of that system—to achieve justice.”4 “The obstruction of justice statute was drafted with an eye to 'the variety of corrupt methods by which the proper administration of justice may be impeded or thwarted, a variety limited only by the imagination of the criminally inclined.'”5 The main body of ' 1503 3 See also KC Goyer, Note, Nancy Temple=s Duty: Professional Responsibility and the Arthur Andersen Verdict, 18 Geo. J. Legal Ethics 261 (2004).
4 United States v. Griffin, 589 F.2d 200, 204 (5th Cir.1979).
5 Id. at 206B07 (quoting Anderson v. United States, 215 F.2d 84, 88 (6th Cir.1954)).
Sec. A “OMNIBUS” CLAUSE OF 18 U.S.C. § 1503 329 specifically targets conduct that interferes with the duties of a juror or court officer.
The “omnibus” clause is the portion of the statute with which we are principally concerned and it states that “[w]hoever... corruptly or by threats or force, or by any threatening letter or communication, influences, obstructs, or impedes, or endeavors to influence, obstruct, or impede, the due administration of justice, shall be punished....” (Emphasis added.) This clause “is essentially a catch-all provision which generally prohibits conduct that interferes with the due administration of justice.”6 The Supreme Court’s Aguilar decision, below, illustrates the Court's concern over the potential breadth of the statute, as well as the ambiguities that exist regarding its constituent elements.
CHIEF JUSTICE REHNQUIST delivered the opinion of the Court.
A jury convicted United States District Judge Robert Aguilar of one count of illegally disclosing a wiretap in violation of 18 U.S.C. ' 2232(c), and of one count of endeavoring to obstruct the due administration of justice in violation of ' 1503....
We granted certiorari to resolve a conflict among the Federal Circuits over whether ' 1503 punishes false statements made to potential grand jury witnesses....
Many facts remain disputed by the parties. Both parties appear to agree, however, that a motion for postconviction relief filed by one Michael Rudy Tham represents the starting point from which events bearing on this case unfolded. Tham was an officer of the International Brotherhood of Teamsters, and was convicted of embezzling funds from the local affiliate of that organization. In July 1987, he filed a motion under 28 U.S.C. ' 2255 to have his conviction set aside. The motion was assigned to Judge Stanley Weigel. Tham, seeking to enhance the odds that his petition would be granted, asked Edward Solomon and Abraham Chalupowitz, a.k.a. Abe Chapman, to assist him by capitalizing on their respective acquaintances with another judge in the Northern District of California, respondent Aguilar.
Respondent knew Chapman as a distant relation by marriage and knew Solomon from law school. Solomon and Chapman met with respondent to discuss Tham's case, as a result of which respondent spoke with Judge Weigel about the matter.
Independent of the embezzlement conviction, the Federal Bureau of Investigation (FBI) identified Tham as a suspect in an investigation of labor racketeering. On April 20, 1987, the FBI applied for authorization to install a wiretap on Tham's business phones. Chapman appeared on the application as a potential interceptee. Chief District Judge Robert Peckham authorized the wiretap.
The 30Bday wiretap expired by law on May 20, 1987, but Chief Judge Peckham maintained the secrecy of the wiretap... after a showing of good cause. During the course of the racketeering investigation, the FBI learned of the meetings between Chapman and respondent. The FBI informed Chief Judge Peckham, who, concerned with appearances of impropriety, advised respondent in August 1987 that Chapman might be connected with criminal elements because Chapman's name had appeared on a wiretap authorization.
6 United States v. Thomas, 916 F.2d 647, 650 n. 3 (11th Cir.1990).
330 OBSTRUCTION OF JUSTICE Ch. 6 Five months after respondent learned that Chapman had been named in a wiretap authorization, he noticed a man observing his home during a visit by Chapman. He alerted his nephew to this fact and conveyed the message (with an intent that his nephew relay the information to Chapman) that Chapman's phone was being wiretapped....
At this point, respondent's involvement in the two separate Tham matters converged. Two months after the disclosure to his nephew, a grand jury began to investigate an alleged conspiracy to influence the outcome of Tham’s habeas case.
Two FBI agents questioned respondent. During the interview, respondent lied about his participation in the Tham case and his knowledge of the wiretap. The grand jury returned an indictment; a jury convicted Aguilar of one count of disclosing a wiretap, 18 U.S.C. ' 2232(c), and one count of endeavoring to obstruct the due administration of justice, ' 1503. … Section 1503... is structured as follows: first it proscribes persons from endeavoring to influence, intimidate, or impede grand or petit jurors or court officers in the discharge of their duties; it then prohibits injuring grand or petit jurors in their person or property because of any verdict or indictment rendered by them; it then prohibits injury of any court officer, commissioner, or similar officer on account of the performance of his official duties; finally, the “Omnibus Clause” serves as a catchall, prohibiting persons from endeavoring to influence, obstruct, or impede the due administration of justice. The latter clause, it can be seen, is far more general in scope than the earlier clauses of the statute. Respondent was charged with a violation of the Omnibus Clause, to wit: with “corruptly endeavor[ing] to influence, obstruct, and impede the...grand jury investigation.” The first case from this Court construing the predecessor statute to ' 1503 was Pettibone v. United States, 148 U.S. 197 (1893). There we held that “a person is not sufficiently charged with obstructing or impeding the due administration of justice in a court unless it appears that he knew or had notice that justice was being administered in such court.” The Court reasoned that a person lacking knowledge of a pending proceeding necessarily lacked the evil intent to obstruct. Recent decisions of Courts of Appeals have likewise tended to place metes and bounds on the very broad language of the catchall provision. The action taken by the accused must be with an intent to influence judicial or grand jury proceedings; it is not enough that there be an intent to influence some ancillary proceeding, such as an investigation independent of the court's or grand jury’s authority. Some courts have phrased this showing as a “nexus” requirement—that the act must have a relationship in time, causation, or logic with the judicial proceedings. In other words, the endeavor must have the “ ‘natural and probable effect’ ” of interfering with the due administration of justice. This is not to say that the defendant's actions need be successful; an “endeavor” suffices. United States v. Russell, 255 U.S. 138, 143 (1921). But as in Pettibone, if the defendant lacks knowledge that his actions are likely to affect the judicial proceeding, he lacks the requisite intent to obstruct.
Although respondent urges various broader grounds for affirmance,1 we find it unnecessary to address them because we think the “nexus” requirement developed in 1 Respondent argues that the term “corruptly” is vague and overbroad as applied to the type of conduct at issue in this case and that Congress narrowed the scope of the Omnibus Clause when it expressly punished his conduct in 18 U.S.C. ' 1512.
Sec. A “OMNIBUS” CLAUSE OF 18 U.S.C. § 1503 331 the decisions of the Courts of Appeals is a correct construction of ' 1503. We have traditionally exercised restraint in assessing the reach of a federal criminal statute, both out of deference to the prerogatives of Congress and out of concern that “a fair warning should be given to the world in language that the common world will understand, of what the law intends to do if a certain line is passed.” We do not believe that uttering false statements to an investigating agent—and that seems to be all that was proved here—who might or might not testify before a grand jury is sufficient to make out a violation of the catchall provision of ' 1503.
The Government did not show here that the agents acted as an arm of the grand jury, or indeed that the grand jury had even summoned the testimony of these particular agents. The Government argues that respondent “understood that his false statements would be provided to the grand jury” and that he made the statements with the intent to thwart the grand jury investigation and not just the FBI investigation. The Government supports its argument with a citation to the transcript of the recorded conversation between Aguilar and the FBI agent at the point where Aguilar asks whether he is a target of a grand jury investigation. The
agent responded to the question by stating:
“[T]here is a Grand Jury meeting. Convening I guess that's the correct word.