'Honest Services' Test
Which Bruno Violated
By Henry J. Stern
December 9, 2009
Just one day after he was convicted in federal court of depriving the public of his "honest services" by taking hundreds of thousands of dollars from people who wanted to do business with
The fair weather is arriving from
As we and the mainstream media reported, Bruno was convicted by a federal jury in
The Supreme Court will decide whether to take Bruno's case if he loses in the United States Court of Appeals for the Second Circuit. That is the first court to which Bruno can appeal if the jurys verdict is upheld by Judge Gary L. Sharpe, who presided at the trial in the Northern District of New York.
Todays news from the High Court is striking, in part because it is almost coincidental with the jurys decision to convict Bruno. On page A24 of the Times, Adam Liptak writes under the headline, JUSTICES APPEAR SKEPTICAL OF ANTICORRUPTION LAW; Measure Criticized as Hopelessly Vague. We quote Liptaks first paragraphs, and link to the rest.
"A federal law that is a favorite tool of prosecutors in corruption cases met with almost universal hostility from the justices in Supreme Court arguments on Tuesday.
"The law, enacted in 1988, makes it a crime 'to deprive another of the intangible right to honest services'. The law is often used to prosecute corporate executives and politicians said to have defrauded their employers or constituents.
"Justices across the court's ideological spectrum took turns on Tuesday attacking the law as hopelessly broad and vague.
"Justice Steven G. Breyer estimated there are 150 million workers in the
"Complimenting the boss's hat 'so the boss will leave the room so that worker can continue to read The Racing Form', Justice Breyer said, could amount to a federal crime.
The article continues for seventeen more paragraphs, but some of them are short. You should link to it if you are interested.
Justice Breyer graduated magna cum laude from
The current justices were nominated by Presidents Ford (Stevens), Reagan (Scalia, Kennedy), Bush the Elder (Thomas), Clinton (Ginsburg, Breyer), Bush the Younger (Roberts. Alito), and Obama (Sotomayor).
Although the justices amused themselves and the public by mocking the vagueness of the phrase "honest services", it is exceedingly difficult to find a legitimate standard of employee dishonesty which rises to the level of criminality. Embezzlement is surely a crime, as well as larceny and burglary, but drawing the line beyond that is somewhat like specifying just what is pornography. It was the late Justice Potter Stewart who said: "I know it when I see it."
Commercial crime, however, is not simple to define, especially when the crime involves collusion and conflicts of interest. In private companies, chief executives treat themselves very generously with the approval of their enablers (bought off or ignorant boards of directors). Is that behavior criminal? What about the Goldman Sachs bonuses of billions of dollars, allegedly awarded as a consequence of the Federal bailout? Or the Bear Stearns brokers who ridiculed companies in their e-mails but nonetheless induced people to buy its commercial paper? They were tried but acquitted by a jury.
There are many cases in which corporate or individual behavior is questionable. Sometimes business decisions are selfish, cruel, unjust and indecent. They may be based on falsehoods, which may or may not be malicious. Greedy people may enrich themselves unfairly at the expense of decent and hardworking men and women. Should such conduct be considered criminal, and who is to make that decision?
This is an issue which is well above my pay grade. There is a certain merit in having juries make those decisions, but in the absence of standards, how are the juries to be instructed by the judges?
The Bruno case appears to us to be one of clear criminality. The Senator took bribes and sold his washed-up crowbait to his partner for $80,000. He delivered state business to his co-conspirator. No matter how low you make the standard of honest service, his conduct falls below it.
What will happen, though, when his case reaches the appellate courts. Is he to escape punishment because of the vagueness of a statute when his conduct is so clearly over the line that he would be convicted under any standard? The charges for which Bruno was acquitted may have been more serious than the ones for which he was convicted. What is likely is that a deadlocked jury compromised by acquitting the senator on most counts, while convicting him of two felonies.
These are issues for the people who write law review articles and are subsequently appointed to the bench, where we, the public, become the beneficiaries of their wisdom and judgment. If the Court wants to set standards for commercial honesty, they should do so, or set guidelines to which statutes could conform. But Justice Antonin Scalea was quoted, in the later part of the Times article, as saying to Deputy Solicitor General Michael R. Dreeben: "You speak as though it is up to us to write the statute. Thats not our job."
How many thieves and swindlers will get away with their crimes while the courts figure out how to define different varieties of reprehensible commercial conduct? It is fortunate that Bernie Madoff was not prosecuted for failure to provide his victims with his "honest services." He too might be looking forward to freedom after having served nine months out of the 150 years in prison to which he was sentenced by Judge Denny Chin. On the other hand, the sentence might stand examination by judges not acting on the passion of the moment. Is it just to incarcerate a 70-year-old swindler (who six times outwitted the Securities and Exchange Commissions minions) for a century and a quarter beyond his attainable life span? Will that decision help an ambitious judge attain promotion? Should it?
Discussions about law are complex. But we come to one conclusion in this article: Joe Bruno will go to sleep tonight a happier man than he was Monday night.
How the Supreme Courts attitude will affect the ways we deal with commercial crime will probably take years to discover. We have the gut feeling, however, that Senator Bruno will not see a correctional facility from the inside for a long time, if at all.
BRUNO IS STILL RESPECTED BY HIS NEIGHBORS
A remarkable article in todays Times appears on pA34, by Jeremy W. Peters. The headline: IN BRUNOS UPSTATE CORNER, NAME STAYS UNTARNISHED the article is a litany of praise for Senator Bruno by residents of his district and surrounding areas. They like him as a person and they are grateful for all the improvements that he brought them with state funds. We link to it here, and if you read it, you will get a picture of an entirely different Joe Bruno than you may have read about in reports from the courtroom. Before making a final judgment on the Senator, you should read both Times articles. One characteristic of his is that, like Robert Moses and the late Arthur Ross, he had no problem in the beneficiaries of his largesse naming the facility he provided in his honor.
The Times says: "Here in the heart of what might be called Brunoland, the constituents who benefited from the billions of dollars the former majority leaders steered to local colleges, community centers, parks, infrastructure projects and social services, still have a stubborn pride about their affiliation with the now-disgraced Mr. Bruno, who was convicted Monday of concealing payments he took from a businessman who sought state funding."
At least one thing is clear: we have not seen, heard or read the last of the Bruno case. Nor has the limping state senate, which lacks any leader.
StarQuest #627 12.09.2009 1475wds