Showing posts from August, 2008

Judge Vacates Plea Deals - Government Now 0-15 Against Specialist Traders

The WSJ Law Blog has reported that the USAO for the S.D.N.Y is having a tough time with their prosecutions of specialist traders. Specialist firms are elite trading operations in charge of specific stocks on the floor of the NYSE. Specialist traders working for such firms are responsible for matching buyers and sellers and providing liquidity by buying or selling shares when there is an imbalance. As the summer of vindication winds down (well, at least the summer part), three more so-called specialist traders might get to enjoy the final days. Last month, the Second Circuit upheld the acquittal of David Finnerty, a former specialist trader at Fleet Specialist, who’d been accused of making improper trades for his firm’s account at the NYSE, and reversed the convictions of two more specialists who used to work at Van der Moolen Specialists. Now, DJ Newswire’s Chad Bray reports , U.S. District Judge Sidney Stein in Manhattan has vacated the guilty pleas (to securities fraud) of two other

Detroit's Mayor Rejects a Plea Bargain

Detroit's mayor, Kwame Kilpatrick, has been engulfed in a number of legal battles this year stemming from revelations that he sent text messages from a city owned pager that demonstrated he was engaged in an extramarital affair with his chief of staff. The messages were important because they contradicted testimony the mayor had offered during a previous civil case in which Detroit police officers alleged they were terminated to prevent the affair from being uncovered. The text messages have led to Kilpatrick being indicted on eight felony counts, including perjury and misconduct. Kilpatrick's legal problems did not end there, however, as he is also alleged to have assaulted two police officers who were attempting to serve a subpoena related to the perjury case on one of his friends. The New York Times is reporting that Kilpatrick turned down a plea deal in the assault case on Friday. The plea offer Kilpatrick rejected would have required him to resign in exchange for the Mich

Deferred and Non-Prosecution Agreements

A new website from the University of Virginia School of Law provides an excellent resource for research regarding deferred and non-prosecution agreements with corporations. The collection allows individuals to search by company name, USAO and date. This library collection contains scanned federal organizational prosecution agreements. It is intended to provide a resource for research concerning federal prosecution of organizations. The Web site was created by Professor Brandon Garrett ( and Jon Ashley ( and will be periodically updated to reflect additional agreements or other developments. We welcome any inquiries or feedback, including questions, corrections or suggestions for additional material to be added to the collection. The agreements, as indicated below, may be displayed by name of entity, jurisdiction or date. Additional information concerning organizational prosecution agreements is in a 2007 Virginia Law Review article. You can acce

The Plea

Several years ago, Frontline offered viewers an incredible look inside the plea bargaining process by documenting the stories of several individuals confronting the difficult choice of whether to accept a plea offer. They each faced different charges in various parts of the country, but the dilemma was the same. The program was entitled The Plea . It is the centerpiece of America's judicial process: the right to a trial by jury system that places a defendant's fate in the hands of a jury of one's peers. But it may surprise many to learn that nearly 95 percent of all cases resulting in felony convictions never reach a jury. Instead, they are settled through plea bargains in which a defendant agrees to plead guilty in exchange for a reduced sentence. "The real American justice system is unlike anything depicted on Law & Order and Court TV," says producer Ofra Bikel. "I know I was stunned when I realized that only about 5 percent of all felony convictions r

DIVERT Court: Saving Lives and Saving Money in Texas

NPR had an interesting story this morning regarding a criminal diversion program in Texas for first time drug offenders arrested for possession of small amounts of narcotics. The program, run by Judge John Creuzot in Dallas, is one of eighty "problem-solving" courts established in the state. This particular program, simply called DIVERT court, was established ten years ago and appears to be paying dividends. There's a rare set of relationships here among criminals, court officials, judge, case managers and drug and alcohol therapists that's grounded in the repetition of seeing each other every week, often several times a week. "Natasha, I'm glad you're here today because you're going to Phase Three," Creuzot announces to widespread applause. It's taken Natasha Stephens a year to get this far, and she returns to her seat, beaming at his praise. "You proud of yourself — you were pretty damn mean when you first got here, girl," the jud

Pleading Guilty in Return for Fast Food - Have We Reached a New Low?

The UK paper The Guardian has reported on a strange and troubling plea deal reached recently in Portland, Oregon. According to the paper, Tremayne Durham pleaded guilty to murder in return for the government's offer of two fast food meals. After almost two years in prison, New Yorker Tremayne Durham could stand it no longer. His craving for a decent bit of nosh was so intense that he agreed to pay a high price - a life sentence. Durham, 33, struck a plea bargain last month in which he was guaranteed a meal of KFC chicken, Popeye's chicken, mashed potato, coleslaw, carrot cake and ice cream - in return for pleading guilty to murder. As part of the deal, and after receiving a life sentence this week in court in Portland, Oregon, Durham will also get a second feast, this time on an Italian theme, with calzone, lasagne, pizza and ice cream. The judge, Eric Bergstrom, is understood to have accepted the bargain because it would save the state of Oregon thousands of dollars in hostin

The Corruption Puzzle - Investigations of Elected Officials and Plea Bargaining

Governing magazine has an interesting article on public corruption investigations, entitled " The Corruption Puzzle ." In the wake of the indictment of Alaska Senator Ted Stevens on charges related to his failure to disclose gifts of services and construction, this article gives an overview of the recent increase in federal investigations of state and local elected officials. Here is part of the piece's introduction. There's no disputing that the feds are going after a lot of state and local officeholders these days. Since 2002, both the number of public corruption cases and the number of FBI agents devoted to such cases has increased by more than 50 percent. But is it because there's been a sudden spike of mischief in office? Or is it more an epidemic of prosecutorial zeal and ambition? Those are not easy questions to answer. But they're increasingly important to ask. What's clear is that we are dealing with a national phenomenon. In the past three years

Obscenity Plea Deal for Pennsylvania Woman

The DOJ announced in a press release yesterday that Karen Fletcher pleaded guilty in the Western District of Pennsylvania to six counts of using an interactive computer service to distribute obscene materials. Of interest is the fact that the obscene materials were in the form of graphic "text stories." According to the DOJ, Fletcher posted stories including disturbing descriptions of abusive behavior towards children. Fletcher was sentenced to serve five years probation, and must serve the first six months under home detention. In handing down the sentence, the Judge stated that she would have seriously considered a prison sentence had the government not recommended against it. The story has been picked up by various news outlets, including a lengthy story in the Pittsburgh Post-Gazette . Here is some of the discussion by the WSJ Law Blog For Karen Fletcher, the sentence imposed on her by a federal judge yesterday will not drastically alter her life. Yes, she was sentenced

Not So Fast - Judge Rejects Attempted Plea by Former Hedge Fund CEO

The WSJ Law Blog has an interesting post regarding Samuel Israel's attempt to plead guilty yesterday. It was over a month ago that Samuel Israel III — the hedge-fund-CEO-turned-felon-turned-fugitive who disappeared on the day he was to report to prison for a 20-year sentence — surrendered to police in Massachusetts. Yesterday, the 49 year-old Israel, former CEO of defunct hedge-fund Bayou, appeared before U.S. District Judge Kenneth Karas in White Plains and attempted to plead guilty to jumping bail, an offense that could net him another 10 years in prison. But Judge Karas wasn’t having it. “The fact there is some doubt about [your competence] makes it imprudent to go forward today,” said Karas, after being told by Israel that he was using methadone to wean himself from fentanyl patches — a prescription painkiller. (In June, just before Israel was to report to prison, his SUV was found abandoned on a bridge in New York’s Westchester County with the words “suicide is painless” scraw

The Latest on Jamie Olis and the Consequences of Refusing to Deal

The Houston Chronicle has reported that the judge in the Jamie Olis case has denied a recusal request. A federal judge — asked to remove himself from former Dynegy employee Jamie Olis' criminal case because he had several things in common with a former prosecutor — ruled this week that he will not. U.S. District Judge Sim Lake, in a 44-page opinion, said a reasonable person would not think the judge biased because he and the late Mike Shelby, the former U.S. attorney for Houston, happened to have worked at the same law firm, gone to the same law school, served in the same military branch and attended some of the same ceremonies. Lloyd Kelley, an attorney for the imprisoned Olis, had asked Lake to bow out of Olis' attempts to have his case reopened based on prosecutorial misconduct. Olis' initial 24-year prison sentence was reduced to the six-year term he's serving for conspiracy and fraud. The Jamie Olis case is a particularly interesting one in the plea bargaining worl