The Supreme Court’s decision in Skilling v. United States fundamentally altered the landscape of 18 U.S.C. § 1346 honest services fraud prosecutions. Cases and clients at every stage of the criminal adjudication process are affected by the Skilling decision and the uncertain state of law. Meanwhile, the Department of Justice and other organizations are lobbying for a Skilling-fix. NACDL opposes such a fix and any attempts to restore a limitless honest service fraud statute. This page recounts the Supreme Court's review of the Skilling case.
Supreme Court Limits the Honest Services Fraud Statute
On June 24, 2010, in Skilling v. United States, the Supreme Court vacated Mr. Skilling’s conviction and remanded because the indictment relied, in part, on what the Court called “an improper construction of the ‘honest services’ component of the federal ban on mail [and wire] fraud.” The Supreme Court held that the “honest services” fraud statute, 18 U.S.C. § 1346, “properly confined,” criminalizes only schemes to defraud that involve bribes or kickbacks.
So limited, the Court found that the law passes constitutional muster, though its application must stick to “core cases” involving dishonest personal gain of some kind. Agreeing with NACDL’s position, however, Associate Justices Antonin Scalia, Clarence Thomas and Anthony Kennedy dissented from that portion of the honest services cases decided today, as they would have found that the statute is simply unconstitutionally vague.
>>>Click here for NACDL's full press release on the decisions<<<
On July 14, 2010, NACDL and the ABA Criminal Justice Section White Collar Crime Committee Public Corruption Subcommittee co-sponsored: Judgment Day: The Supreme Court Rules On Honest Services Fraud - Understanding the Outcome and Its Ramifications. This program, which is the first installment of NACDL's 2010 White Collar Summer Series, examined the Supreme Court's much anticipated ruling in Skilling v. United States, and the ramifications it will have on public corruption prosecution and defense.
The panel was moderated by Ross H. Garber of Shipman & Goodwin LLP, and included Abbe David Lowell (McDermott Will & Emery), Timothy P. O'Toole (Miller & Chevalier), Ellen S. Podgor (Stetson University College of Law), and Cynthia Hujar Orr (President of NACDL). Click here to access a free audio recording on this program.
Supreme Court Grants Cert in Three Honest Services Fraud Cases
On Monday, March 1, 2010, the Supreme Court heard oral argument in its third “honest services” fraud case this term, Jeffrey K. Skilling v. United States. Last fall, on Tuesday, December 8, 2009, the Supreme Court heard oral arguments in two high–profile “honest services” fraud cases, Conrad M. Black v. United States and Bruce Weyhrauch v. United States. In his often–quoted dissent from denial of certiorari in Sorich v. United States, Justice Scalia wrote: “If the ’honest services’ theory ... is taken seriously and carried to its logical conclusion, presumably the statute also renders criminal a state legislator’s decision to vote for a bill because he expects it will curry favor with a small minority essential to his reelection [and] a mayor’s attempt to use the prestige of his office to obtain a restaurant table without a reservation .... Indeed, it would seemingly cover a salaried employee’s phoning in sick to go to a ball game.”
NACDL is deeply concerned by the vagueness and federalism problems of 18 U.S.C. §1346, the “honest services” statute. Due process requires that a criminal law give fair warning, at the time of the offense, of what conduct is prohibited, and therefore NACDL has filed amicus briefs in all three of the above cases arguing that the law is unconstitutional. Those amicus briefs can be found here: Conrad M. Black v. United States, Weyhrauch v. United States and Skilling v. United States.