August 2, 2021

Justices fear over-prosecution in case against fisherman

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John-YatesBy Marcia Coyle, From Supreme Court Brief

A government attorney, defending a financial fraud law used to prosecute a fisherman for destroying undersized grouper to avoid paying a fine, underwent blistering and sometimes derisive questioning by U.S. Supreme Court justices.

“What kind of mad prosecutor would try to send this guy up for 20 years [in prison] or risk sending him up for 20 years?” asked Justice Antonin Scalia, referring to the criminal penalty that Capt. John Yates faced under the post-Enron law known as the Sarbanes-Oxley Act.

“Who do you have out there that exercises prosecutorial discretion? Is this the same guy who brought the prosecution in Bond last term?” he asked again, referring this time to Bond v. United States, in which federal prosecutors charged a woman with violating a treaty banning the use of chemical weapons after she placed some caustic substances on the doorknob, mailbox and car of a friend who had an affair with her husband. (She won in a unanimous decision.)

Justice Anthony Kennedy suggested, “Perhaps Congress should have called this the Sarbanes-Oxley-Grouper Act.” And as for prosecutorial discretion, Kennedy added, “Well, it seems to me that we should just not use the concept or refer to the concept at all anymore.”

Despite the barrage, assistant to the solicitor general Roman Martinez never flinched nor strayed from his argument that fish are “tangible objects.” They fall under a provision, he argued, that makes it a crime to knowingly alter, destroy, falsify, mutilate, conceal or make a false entry in “any record, document or tangible object” to obstruct or influence an investigation involving any department or agency of the federal government.

The provision, Martinez said, was intended to punish destruction of evidence in general—all types of physical evidence. “That’s clear from the standard meaning of those words in ordinary speech and from the broader statutory and historical context in which those words appear,” he said.

Yates’ legal troubles began when a federally deputized state fish and wildlife conservation officer boarded his boat in the Gulf of Mexico for a routine inspection. The officer found that 72 red grouper out of a catch of about 3,000 were undersized. The officer issued a citation and made Yates isolate the illegal fish so they could be destroyed when the boat returned to dock.

Later, at the dock, the inspector found that the fish did not match his original measurements. He questioned the crew and discovered that Yates had ordered them to throw the undersized fish overboard and replace them with larger fish.

In 2011, a jury found Yates guilty of destroying property to prevent a federal seizure and destroying a “tangible object” to obstruct a federal investigation. He was sentenced to 30 months in jail followed by three years’ supervised release. Prosecutors had sought two years in prison.

During arguments Wednesday, Yates’ lawyer, assistant federal defender John Badalamenti of Tampa, argued that the “natural, sensible and contextual” reading of the Sarbanes-Oxley provision is that the phrase “record, document or tangible object” is confined to records, documents and devices designed to preserve information, “the very matters involved in the Enron debacle.”

Congress, he contended, would never have silently slipped as broad a provision as the government contends into the act.

He faced a series of hypotheticals testing his definition of tangible objects—those designed to preserve information—and whether they fall under the provision. What about the cloud, Justice Sonia Sotomayor asked, or a brand new empty filing cabinet, Justice Samuel Alito Jr. pressed

Kennedy told Badalamenti that his argument the government was engaging in over-criminalization had “considerable force,” but his test—a tangible object designed to preserve information—had “more problems with determining what its boundaries are than the government’s test.”

Throughout the questioning of both lawyers, a number of justices sought some limiting principle that would prevent minor crimes from being swept under the provision. And, they were skeptical of Martinez’s assurances that the government would exercise discretion, particularly after the advocate said prosecutors are usually told to charge the most severe, relevant crime.

Justice Stephen Breyer said he worried about the case of a camper who kicks away an ember knowing campfires are not allowed, or picks a wildflower knowing that is banned. “Twenty years, and you could multiple that beyond belief,” he said.

Martinez urged the justices to write a narrow opinion clarifying that the Yates case is about the meaning of the term “any tangible object.” And, if the ember or wildflower case comes up some day, other parties would flesh out those arguments.

“It’s highly implausible to believe that Congress chose this broad and expansive phrase, ‘any tangible object,’ when what it really wanted to do was refer only to a very narrow and specific category of information storage devices,” he argued.

But Badalamenti told the justices that Congress imposed a 20-year penalty under the act because it recognized the harm that Enron-Arthur Andersen-type of crime did to the financial health of the country. Congress wanted to send a message to the public not to engage in record destruction to impede investigations.

“That’s why it’s important to limit the subject matter of this particular statute to just record-related matters,” he said.

The United States, he added, has existed for more than 200 years “without this mega, all-inclusive, obstruction-of-justice statute with the intent to impede anything, any matter, that the possibility of the United States could or may or may never be interested in. [Congress] didn’t create it buried within the Sarbanes-Oxley Act and this court shouldn’t put it in there now.”

Reed Rubenstein, senior vice president for litigation of Cause of Action, an amicus party supporting Yates, said after watching the arguments, “I think they’re struggling to find a limiting principle that will cabin the government’s discretion. The obvious one is that this law was designed to apply to business records. To do anything else leads you into the land of absurdities that justices Breyer and Kennedy pointed out.”

IMAGE: John Yates The Anna Maria Islander / Kathy Prucnell

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