Saturday, July 26, 2014

Dallas County District Attorney's Office - First-of-its-Kind Exoneration in US

The Dallas County District Attorney's Office has issued a press release regarding a new exoneration. According to the DA's Office, this is a first-of-its-kind exoneration because it results from systematic DNA testing, even though the soon-to-be exoneree was not actively proclaiming his innocence or requesting DNA testing. It is also important to note for readers of this blog that the exoneree pleaded guilty to the charged offense (rape) even though he was in fact innocent.
A 57-year old Dallas man falsely convicted of sexual assault will be exonerated as a result of systematic DNA testing by a district attorney’s office, even though he was not actively proclaiming his innocence or requesting DNA testing. According to the National Registry of Exonerations, this is the first time in the United States an exoneration of this nature has occurred.

Mr. Michael Phillips, an African-American, served 12 years in prison after pleading guilty in 1990 for raping a 16-year-old Caucasian girl at a Dallas motel where both of them lived. Mr. Phillips says his defense attorney told him not to risk going to trial – fearing a jury would not side with a black man accused of raping a white girl who picked Mr. Phillips out of a photo line- up.

However, Dallas County District Attorney Craig Watkins’ ongoing project of reviewing untested rape kits without defendants initiating the request revealed Mr. Phillips was innocent. DA Watkins signed off on this proactive screening project, which tests DNA preserved by the Southwest Institute of Forensic Sciences. The Dallas area crime lab tested sexual assault kits from the year 1990 that met certain criteria, which paved the way for Mr. Phillips’ exoneration.
Click here for the entire press release.

Click here for a copy of "The Innocent Defendant's Dilemma: An Innovative Empirical Study of Plea Bargaining's Innocence Problem."

Wednesday, July 23, 2014

United States v. Harden - New 7th Circuit Case re Magistrate's Role in Accepting Felony Plea of Guilty

An interesting new case from the 7th Circuit.  In United Sates v. Harden (7th Cir. July 14, 2014), the court examined whether a magistrate judge could properly accept a plea of guilty from a defendant charged with a felony.  From the opinion:
Pursuant to a written plea agreement, Defendant-Appellant Stacy Lee Harden pled guilty to possession with the intent to distribute cocaine.  With Harden's consent, the district court instructed a magistrate judge to conduct a Federal Rule of Criminal Procedure 11 plea colloquy under a local rule allowing for magistrate judges to accept felony guilty pleas.  The magistrate judge accepted Harden's guilty plea, and the district court then conducted a sentencing hearing and imposed sentence.  Harden now appeals the magistrate judge's acceptance of his guilty plea, arguing that the magistrate judge's acceptance of a felony guilty plea, instead of preparing a report and recommendation to the district court, was a violation of the Federal Magistrates Act, 28 U.S.C. section 636; Rule 59 of the Federal Rules of Criminal Procedure, and the United States Constitution.
In examining the importance of the guilty plea, the court stated:

“[A] guilty plea is a waiver of important constitutional rights designed to protect the fairness of a trial.” Johnson v. Ohio, 419 U.S. 924, 925 (1974). It is “more than an admission of past conduct: it is the defendant’s consent that judgment of conviction may be entered without a trial—a waiver of his right to trial before a jury or judge.” Brady v. United States, 397 U.S. 742, 748 (1970). In addition to waiving these core rights and protections afforded by our system of criminal justice, defendants often waive their appellate and habeas corpus rights as well. In such cases, accepting a guilty plea is even more final than a guilty verdict. Consequently, when a judge accepts a guilty plea, the judge is required to conduct a long, searching colloquy, as required by Federal Rule of Criminal Procedure 11(b), to ensure that the defendant’s waivers of his important rights are “voluntary ... knowing, intelligent acts done with sufficient awareness of the relevant circumstances and likely consequences.” Brady, 397 U.S. at 748.
The court then went on to rule that just as a magistrate may not conduct a felony trial, even with the consent of the parties, a magistrate may not accept a guilty verdict in a felony case. 

That same limiting principle (that magistrate judges may not conduct felony trials) leads us to our conclusion that the acceptance of a guilty plea in a felony case, a task no less important, is also not authorized by the statute. In accepting Harden’s guilty plea, even with his consent, the magistrate judge violated the Federal Magistrates Act. 
There is very interesting language at the end of the opinion regarding a split in the Circuits regarding this issue. 

We note that our reasoning places us in conflict with several of our sister circuits. There is widespread agreement that a magistrate judge may conduct a Rule 11(b) colloquy for the purpose of making a report and recommendation. See, e.g., United States v. Reyna-Tapia, 328 F.3d 1114, 1119–22 (9th Cir. 2003) (en banc); United States v. Torres, 258 F.3d 791, 796 (8th Cir. 2001); United States v. Dees, 125 F.3d 261, 263, 265 (5th Cir. 1997); United States v. Williams, 23 F.3d 629, 631– 34 (2d Cir. 1994). We agree that this is a permissible practice (and are told that that the district court for the Southern District of Illinois now delegates the conduct of a plea colloquy to a magistrate judge only when a report and recommendation on the plea is sent back to the district judge). Several circuits go further and authorize magistrate judges to accept felony guilty pleas with the parties’ consent. See United States v. Benton, 523 F.3d 424, 431–32 (4th Cir. 2008); United States v. Woodard, 387 F.3d 1329, 1332–33 (11th Cir. 2004); United States v. Ciapponi, 77 F.3d 1247, 1250–52 (10th Cir. 1996). Those courts place great import on the statement in Peretz that “Congress intended to give federal judges significant leeway to experiment with possible improvements in the efficiency of the judicial process....” 501 U.S. at 932.
The case then concludes by noting the importance of plea bargaining today and the need to protect defendant's rights during this stage of the proceedings.  

The desire to make more efficient the district courts’ management of large criminal caseloads is understandable. These days, over 97% of criminal convictions are the result of guilty pleas. See “Statistical Tables for the Federal Judiciary,” Table D-4 (June 2013) (finding that of 84,060 total criminal convictions in a twelve-month period, 81,955 were the result of guilty pleas). Truly, “criminal justice today is for the most part a system of pleas, not a system of trials.” Lafler v. Cooper, 132 S. Ct. 1376, 1388 (2012). Yet, the prevalence of guilty pleas does not render them less important, or the protections waived through them any less fundamental. A felony guilty plea is equal in importance to a felony trial leading to a verdict of guilty. And without explicit authorization from Congress, the district court cannot delegate this vital task. The authority to experiment set forth in Peretz is bounded; the Court has never suggested that magistrate judges, with the parties’ consent, may perform every duty of an Article III judge, regardless of the duty’s importance.  (some internal citations omitted)
The entire opinion is available here.

Monday, July 14, 2014

Citigroup Agrees to Pay $7 Billion Settlement

Citigroup has agreed to pay $7 billion related to allegations that it packaged bad mortgages during the pre-financial crisis period.  $4 billion of the payment will be penalties for the alleged conduct.  $2.5 billion will be used in mortgage modifications and related relief for homeowners.  The remaining $500 million will be distributed between five states and the Federal Deposit Insurance Corp.

The settlement avoids further civil litigation by the Department of Justice.  According to CNN, Attorney General Eric Holder stated, "Under the terms of this settlement, the bank has admitted to its misdeeds in great detail.  The bank's activities shattered the livelihoods throughout the country."  He went on to state, "They contributed mightily to the financial crisis that devastated our economy in 2008."

The entire CNN article regarding the settlement is available here.

Thursday, July 3, 2014

Regulatory Overcriminalization and Plea Bargaining - Congressional Testimony Update

In November 2013, I testified before the United States House of Representatives' Committee on the Judiciary Over-Criminalization Task Force.

During my testimony, I examined the phenomenon of over-criminalization, particularly in the regulatory area, and offered several recommended solutions for Congressional adoption. First, I recommended the adoption of a default rule for mens rea. Second, I recommended the adoption of a default rule applying mens rea to all material elements of an offense. Third, I recommended the codification of the Rule of Lenity. Finally, along with some additional recommendations for consideration, I discussed the role of plea bargaining in the U.S. criminal justice system and encouraged the Task Force to more closely examine this issue in the future.

My written testimony from that hearing is now available on SSRN for free download by clicking here.

A previous post regarding my testimony is available by clicking here.

Tuesday, July 1, 2014

BNP Paribas Agrees to Nearly $9 Billion Penalty

BNP Paribas, a French bank, has pleaded guilty to criminal charges related to breaching U.S. sanctions. Under the terms of the deal, it is reported that BNP Paribas will pay almost $9 billion in penalties.

From CNN:
The settlement concludes a long-running criminal investigation into allegations that BNP Paribas (BNPQF) violated U.S. money laundering laws by helping clients dodge sanctions on Iran, Sudan and other countries.
 The deal between the bank and prosecutors had been expected for months.    Shares in the bank edged higher Monday in Paris, having fallen more than 12% so far this year in anticipation.
 In an agreement with the Manhattan District Attorney Cyrus Vance, the bank pleaded guilty to falsifying business records and conspiracy in Manhattan Supreme Court.  It is expected to plead guilty for violating money laundering laws in federal court with U.S. Attorney Preet Bharara next week.The bank also agreed to a sanction by the New York department of financial services. It will suspend certain U.S. dollar clearing transaction services through its New York branch for one year.  BNP Paribas said it would clear U.S. dollars "through a third-party bank instead of clearing through BNP Paribas New York."
 About 30 employees will leave BNP Paribas as a result of the investigation, including several who have gone already, according to a U.S. official.
The CNN article discusses the severity of the penalty and states:
The severity of the punishment relates to the bank's lack of cooperation over a period of years, said an official who was briefed on the investigation Monday. The bank continued to process transactions that the U.S. says violated the law even after the investigation began.
The entire CNN article is available here

I have previously written about the important role cooperation plays in decisions by the U.S. Department of Justice regarding the prosecution of corporations. Pursuant to the US Attorney's Manual Principles of Prosecution of Business Organization (found here):  
In conducting an investigation, determining whether to bring charges, and negotiating plea or other agreements, prosecutors should consider the following factors in reaching a decision as to the proper treatment of a corporate target:...4.
the corporation's timely and voluntary disclosure of wrongdoing and its willingness to cooperate in the investigation of its agents (see USAM 9-28.700);
For an article discussing this concept further, see the following:

Re-Evaluating Corporate Criminal Liability: The DOJ’s Internal Moral Culpability Standard for Corporate Criminal Liability, 41 Stetson Law Review 7 (2011) (symposium article) - available for free download here

There is also an interesting article in the New York Times about the BNP Paribas case.  The article discusses how a bus bombing two decades ago set in motion a chain of events that led to the prosecution of various banks, including BNP Paribas. From the New York Times article:
The trail that ultimately led to BNP began in 2006, when the Manhattan district attorney’s office came upon a lawsuit filed by the father, who blamed Iran for financing the Gaza bus bombing that killed his 20-year-old daughter. Buried in the court filings, prosecutors found a stunning accusation: a charity that owned a gleaming office tower on Fifth Avenue was actually a “front” for the Iranian government, a claim that the prosecutors later verified.   The prosecutors soon discovered that Credit Suisse and Lloyds, two of the world’s most prestigious banks, had acted as Iran’s portal to the United States financial system. To disguise the illicit transactions — the United States is closed for business to Iran — Credit Suisse and Lloyds stripped out the Iranian clients’ names from wire transfers to the Fifth Avenue charity and affiliated entities. The findings led the Manhattan prosecutors and the Justice Department in Washington to announce criminal cases against both banks.  As those cases were coming to light in 2009, a whistle-blower stepped forward to point the finger at BNP, France’s biggest bank. That tip has now materialized in a landmark criminal settlement, with BNP pleading guilty to criminal charges, capping a sweeping investigation into the bank’s ties to Sudan and Iran.
The entire New York Times article is available here