It’s Time to Rethink How Our Federal Agencies Seize Cash and Property

Published at Manhattan-Institute by James R. Copland | April 11, 2017

Late last month the Justice Department’s Office of the Inspector General (OIG) released a 74-page report on how the department oversees asset forfeitures– the practice in which law enforcement and government agencies  seize property they believe was connected to a crime.

The asset seizures clearly needed a closer look. Regardless of how President Trump and Attorney General Jeff Sessions feel about the topic— and both have been skeptical of reforming this system — the new report should inform the attorney general’s newly announced Task Force on Crime Reduction and Public Safety and prompt congressional leaders to take a closer look.

According to the OIG report, the Drug Enforcement Administration, Federal Bureau of Investigations, and Bureau of Alcohol, Tobacco and Firearms grab the assets of thousands of people annually, and there is big money involved.

The DEA alone has made more than 80,000 cash seizures resulting in forfeitures that totaled more than $4 billion over the last decade. The overall total for the Justice Department seizure program has grown over….

Read the entire piece here at


Gorsuch v. Overcriminalization

Originally published in National Review by C Jarrett Dieterle | February 24, 2017

The Supreme Court nominee has been a sharp critic of the rapid expansion of the criminal code.

Much of the media attention to date surrounding President Trump’s Supreme Court nominee Neil Gorsuch has centered on the judge’s views of originalism, separation of powers, administrative law, and related topics. Largely overlooked has been an area where Judge Gorsuch’s track record shows a keen awareness of another issue critical to the federal courts: America’s criminal-justice system.  TOP ARTICLES3/5READ MOREBloomberg Claims Russia Is AidingSanders in Primary to Aid Trump in General Election

The importance of criminal law is underscored by the breathtaking size of the federal criminal code. Nearly 5,000 federal crimes are on the books, not including the sort of regulatory crimes that likely push the number above 300,000. Worse yet, many criminal laws are written in vague terms that fail to clearly identify what constitutes a crime, leaving Americans in the dark about whether their conduct in many cases is criminal.

In a 2013 lecture for the Federalist Society, Gorsuch confronted the problem of over-criminalization, whereby criminal laws target conduct that is not inherently wrong. Using examples of obscure crimes, such as ripping off a mattress tag, Gorsuch argued that no American can possibly comprehend all the activities prohibited by federal law. “Without written laws, we lack fair notice of the rules we must obey,” as he puts it, adding that fair notice is also lacking when we have “too many written laws.” In other words, it’s unreasonable to expect Americans to be aware of thousands of laws, much less stay on the right side of them.

Gorsuch’s expressions of concern about over-criminalization haven’t been confined to speeches. In last year’s Caring Hearts Home Services v. Burwell decision, he had harsh words for a federal agency that forgot its own regulations and misapplied them to a home health-care provider. Gorsuch chastised the agency, noting that it “issues literally thousands of new or revised guidance documents every single year,” making it nearly impossible to know which regulations apply at any given time. He rhetorically asked: If the government itself, “the very ‘expert’ agency responsible for promulgating the law,” cannot keep its own laws straight, how can the general public?

Gorsuch has equally strong views on the issue of criminal intent. Under traditional common law, acting with mens rea (a guilty or criminal mind) is a core component of committing a crime. This understanding prevents individuals who inadvertently or accidently do something wrong from being branded criminals.

In United States v. Games-Perez (2012), the government charged a defendant under a law that made it illegal to “knowingly” possess a gun if you were previously convicted of a felony. The defendant claimed he lacked the necessary criminal mindset to be found guilty because he lacked knowledge of his previous felony conviction. Gorsuch sided with the defendant, arguing that the defendant had to know both that he possessed a gun and that he was a felon. Although overruled by his colleagues, in his dissent he took a principled stand to ensure that only those who truly intend to break the law are targeted.

Gorsuch also has shown willingness to rely on another historical judicial doctrine, the “Rule of Lenity”: Courts that confront ambiguous and vague criminal statutes are urged to interpret those laws in favor of defendants. Gorsuch applied this rule — also a favorite of the late Justice Antonin Scalia — in United States v. Rentz (2015), a case involving a law that imposed heightened penalties on individuals who “use” a gun to commit a violent crime or drug offense. Although the defendant in the case had “used” his gun only once, he had managed to kill two people, resulting in, the government argued, two separate violations of the law. In the majority opinion, Gorsuch engaged in a painstaking textual analysis of the law — he famously diagrammed a sentence — before invoking the Rule of Lenity to hold that the defendant had committed only a single violation (a finding that reduced his sentence).COMMENTS

“Our job is always in the first instance to follow Congress’s directions,” Gorsuch wrote. “But if those directions are unclear, the tie goes to the presumptively free citizen and not the prosecutor.”

Gorsuch’s principle that any “tie” should go to citizens over the government shows his wariness of the vast powers possessed by prosecutors in an over-criminalized society. His tendency to view criminal laws, especially vague ones, with a healthy measure of skepticism should give opponents of over-criminalization a much-needed ally on the nation’s highest court.

C. JARRETT DIETERLE is the director of commercial freedom and a senior fellow at the R Street Institute.


How Policymakers Can Tackle Overcriminalization

Originally published at Cato Institute by Tim Lynch | February 16, 2017

People: Aaron Swartz, Dudley Hiibel, Bobby Unser, Eric Garner

Policymakers should

  • Override the old maxim that “ignorance of the law is no excuse” (given the breadth of the criminal codes now on the books, that doctrine no longer makes sense);
  • strengthen the rule of lenity for criminal cases by enacting a statute that explicitly provides for the strict construction of all criminal laws; and,
  • prohibit administrative agencies from creating new crimes.

Over the past 10 years, there has been much discussion in academic and policy circles concerning “mass incarceration” in the United States. Many have observed that there is something incongruous about America, the land of the free, finding itself with one of the highest incarceration rates in the world. The United States has about 2 million inmates and another 7 million persons under the “supervision” of the criminal justice system. Something is amiss, but the root of the problem is not sentencing policy; rather, it is the burgeoning criminal codes at the “front end” of the criminal system. Policymakers at all levels of government have criminalized so many activities that it should come as no surprise that our courthouses are clogged with cases and our prisons are overflowing with inmates. Politicians have recklessly sought short‐​term political advantage by taking “credit” for new laws while ignoring the long‐​term consequences of their policy decisions. It is no overstatement to say that the politics of criminalization threaten the very foundation of our free society.

The Legal Minefield

Every year American lawmakers add new crimes to the law books. Under the Constitution, crime fighting is supposed to be reserved to state and local government. But over the past 40 years, Congress has federalized many of the crimes that have always been investigated by local police. Politicians have also found ways to recriminalize criminal conduct. “Hate crimes,” for example, duplicate crimes such as murder and assault and add stiffer penalties when prosecutors can prove that bigotry was a motivating factor behind the violence.

The criminal law has also followed the rise of the regulatory state. In addition to the thousands of criminal laws, there are now tens of thousands of regulations that carry criminal penalties, including prison time. The web of rules has become so vast that it seems as if most Americans are now criminals whether they realize it or not.

The overcriminalization phenomenon extends beyond the realm of violence, fraud, vice, and commercial regulations. Consider these cases:
• A river guide saw a teenager in distress and so left his boat and swam to save her. He was charged with “obstructing government operations” for not waiting for the search and rescue team.
• Federal prosecutors indicted computer prodigy Aaron Swartz for improperly downloading articles from the digital library JSTOR. The Justice Department maintains that when a website owner’s terms‐​of‐​service policy is violated, a crime is also committed — even though owners retain the right to change the terms at any time and without prior notice. Frightened by the prospect of bankruptcy, a long prison sentence, or both, Swartz took his own life.
• Retired race car driver Bobby Unser was prosecuted by federal authorities for driving his snowmobile on protected federal land. Unser and his friend got lost during a snowstorm and were desperately seeking shelter or assistance.
• Nevada rancher Dudley Hiibel was jailed for declining to give his name to a policeman.
• Members of a Christian outreach group were arrested and prosecuted for feeding the homeless in a Ft. Lauderdale park. Local rules restricted food sharing.

There was a telling moment before the Supreme Court in 2009 when a government lawyer was explaining the scope of the federal “honest services” law. The lawyer from the Department of Justice said that law criminalized any ethical lapse in the workplace. In response, Justice Stephen Breyer exclaimed, “There are 150 million workers in the United States. I think possibly 140 million of them flunk your test.” The government lawyer did not deny Justice Breyer’s observation. As unbelievable as it may sound, the federal government considers more than a hundred million Americans to be criminals. And that is only under its interpretation of a single federal statute. As noted, there are thousands and thousands more. The overcriminalization phenomenon is thus quite real.

The Consequences of Overcriminalization

There are several reasons to be alarmed by the exponential growth of criminal rules and regulations. First and foremost, America has always prided itself on its freedom; but a society in which the criminal rules are so pervasive that no one is safe from arrest and prosecution cannot be described as free. The traditional common law crimes — murder, rape, theft, assault — do not restrict the freedom of the citizenry to live their own lives peaceably. However, as soon as the government goes beyond the basic crimes to prohibit other human activities, the adverse impact on liberty becomes evident. As the criminal law expands, there is a concomitant diminution of liberty.

Second, when criminal code violations become virtually unavoidable, the safeguards in the Bill of Rights become ineffectual. As the Harvard legal scholar Henry Hart observed, “What sense does it make to insist upon procedural safeguards in criminal prosecutions if anything whatever can be made a crime in the first place?” Hart’s point was that if some rule can be shown to have been violated, a speedy trial cannot help the person facing a prison sentence. And an able defense attorney can only help his client by making a plea for leniency.

Third, law enforcement resources are limited. The police and courts are busy enough with violent crimes, theft, and extortion. Those cases will be neglected if the police are burdened with additional responsibilities. Andrew McCarthy, a former federal prosecutor, reminds us that there is no getting around the tradeoff: time and money “spent investigating conduct that is not inherently criminal are time and money lost to the thwarting of much more serious crime.”

Fourth, policymakers should always pause to remember that every rule brings about the possibility that the police will have to employ violence to enforce that rule. Eric Garner was killed by New York City police as they were trying to enforce a rule against selling individual cigarettes (“loosies”) on the street. Yale Law School professor Stephen Carter has noted that if policymakers want to seriously reduce the opportunities for dangerous interactions between police and civilians, they should stop talking about “better police training” and scale back the criminal codes.

Fifth, another inevitable consequence of overcriminalization has been more governmental errors. Innocent people are sometimes arrested, prosecuted, and imprisoned. Wrongful convictions are not only unjust to the prisoner, but to his or her family — children, spouse, parents, and siblings. One effective way to limit those miscarriages of justice is to keep the criminal system as small as possible. If America has two million people imprisoned and the government has done its job properly in 95 percent of the cases, that means 100,000 people are unjustly imprisoned. By scaling back the criminal codes, so that the total number of people prosecuted and imprisoned is reduced, policymakers could also reduce the number of innocent persons mistakenly imprisoned.

Reform Measures

Of course, overcriminalization can be addressed in many ways. The following are three possible routes to correcting the system.

Override the Old Maxim That “Ignorance of the Law Is No Excuse”

It is absurd and unjust for the government to impose a legal duty on every citizen to “know” all of the mind‐​boggling rules and regulations that have been promulgated over the years. The old maxim that “ignorance of the law is no excuse” only makes sense when the criminal law covers conduct that is plainly and inherently wrongful, such as murder and theft.

To illustrate the rank injustice that can occur, take the case of Carlton Wilson, who was prosecuted because he possessed a firearm. Wilson’s purchase of the firearm was perfectly legal. Years later, a judge issued a restraining order against Wilson during his divorce proceedings. He didn’t know that meant he had to give up the firearm. When Wilson protested that the judge never informed him of that obligation and that the restraining order itself said nothing about firearms, prosecutors shrugged, “ignorance of the law is no excuse.” Although the courts upheld Wilson’s conviction, Judge Richard Posner filed a dissent: “We want people to familiarize themselves with the laws bearing on their activities. But a reasonable opportunity doesn’t mean being able to go to the local law library and read Title 18. It would be preposterous to suppose that someone from Wilson’s milieu is able to take advantage of such an opportunity.” Judge Posner noted that Wilson would serve more than three years in a federal penitentiary for an omission that he “could not have suspected was a crime or even a civil wrong.”

Policymakers should override the “ignorance‐​is‐​no‐​excuse” maxim by enacting a law that requires prosecutors to prove that regulatory violations are “willful” or, in the alternative, that permits defendants to plead a good‐​faith belief in the legality of one’s conduct. The former rule is already in place for our complicated tax laws. It should also shield unwary Americans from all laws and regulations as well.

Strengthen the Rule of Lenity

Even if there were only a few crimes on the books, the terms of our criminal laws ought to be drafted with precision. After all, there is little difference between a secret law and a published regulation that cannot be understood. The American Revolutionaries believed in the Latin maxim nullum crimen sine lege, which means there can be no crime without a law. In other words, people can be punished only for conduct previously prohibited by law. That principle is clearly enunciated in the ex post facto clause of the Constitution (Article I, Section 9). But the purpose of that clause can be subverted if the legislature can enact a criminal law with vague terms that can be interpreted broadly by prosecutors or judges. Such a law would not give citizens fair warning of the prohibited conduct.

One way to address the problem of vague laws that were previously enacted would be for legislators to direct the courts to follow the “rule of lenity.” That doctrine resolves legal uncertainties in favor of the accused, not the government. Unfortunately, the courts have not invoked that doctrine consistently.

Prohibit Administrative Agencies from Creating New Crimes

Beyond the thousands of criminal statutes enacted by legislatures, there are also thousands of regulations that carry criminal penalties. It is the responsibility of elected officials to carefully consider what infractions can result in a criminal conviction and prison time.

The case law that has thus far allowed the delegation of lawmaking has drawn criticism. U.S. district judge Roger Vinson, for example, has observed:

A jurisprudence which allows Congress to impliedly delegate its criminal lawmaking authority to a regulatory agency such as the Army Corps — so long as Congress provides an “intelligible principle” to guide that agency — is enough to make any judge pause and question what has happened. Deferent and minimal judicial review of Congress’ transfer of its criminal lawmaking function to other bodies, in other branches, calls into question the vitality of the tripartite system established by our Constitution. It also calls into question the nexus that must exist between the law so applied and simple logic and common sense.

Making conduct criminal is a serious matter. It is a decision that ought to be made by the people’s elected representatives, whether in Congress, the state legislatures, or city councils.


Political observers have noted that criminal justice reform is one of the few policy areas that is now finding support from across the political spectrum. On the left, law professor Michelle Alexander, author of The New Jim Crow: Mass Incarceration in the Age of Colorblindness, tells her students that even though she has earned fancy degrees, she is a criminal. She challenges others to come clean as well. After all, just because a person has not been caught does not mean she is not a criminal in the eyes of the law. Alexander believes reform will happen when more people come to terms with their own “criminality.” On the right, U.S. circuit judge Alex Kozinski makes a similar point in his article, “You’re (Probably) a Federal Criminal.” Most Americans are criminals, but don’t know it, he writes.

There are some indications that the policy climate is becoming more receptive to fundamental reform. A recent cover story in Harper’s was titled, “Legalize It All: How to Win the War on Drugs.” A few weeks later, a cover story in The New York Times Magazine posed the question, “Should Prostitution Be a Crime?” While these questions are still being debated, it seems clear that more and more people are coming to recognize that vices are not crimes that warrant the intervention of police powers. Over the past few years, policymakers in Vermont, Maine, Colorado, and New Hampshire have voted to repeal criminal laws regarding adultery. These developments are welcome, but policymakers should move more aggressively toward criminal code reform and prune the law books of unnecessary and unjust criminal provisions. An expansive criminal code is inimical to a free society.


How Policymakers Should Reform White Collar Prosecutions

Originally published by Cato Institute by Walter Olson | February 16, 2017

Congress and state lawmakers (and where appropriate, the president and executive branch law enforcement officials) should

• review existing law with an eye toward rolling back overcriminalization and replacing criminal penalties with civil sanctions where feasible;
• enact reforms such as the model Criminal Intent Protection Act to bolster recognition of mens rea (punishment should ordinarily require a guilty state of mind, not inadvertent noncompliance) as well as the related mistake of law defense in criminal law;
• codify the common law rule of lenity (ambiguity in law should be resolved against finding guilt), as Texas joined other states in doing in 2015;
• devise safe harbor provisions that enable economic actors to avoid criminal liability by behaving reasonably and in intended compliance with the law;
• limit agency discretion to create new crimes without an act of the legislature;
• enact guidelines to strengthen judicial oversight of deferred prosecution agreements and nonprosecution agreements (explicit court approval, not the unilateral say‐​so of government prosecutors, should be required for appointment of corporate monitors or the extension of time under supervision);
• enact asset forfeiture reforms such as Rep. Jim Sensenbrenner’s (R‑WI) Due Process Act, including requiring that conviction be a prerequisite for forfeiture;
• review and, where appropriate, reduce or coordinate per‐​offense fines and sanctions to avoid levying penalties disproportionate to the gravity of misconduct;
• prohibit, as a proposed New Mexico law would do, the allocation of settlement moneys (cy pres) to charities, nonprofits, or advocacy groups not themselves injured;
• assign penalties, forfeitures, and settlement proceeds to the public treasury or, where appropriate in certain cases, to private parties who can show specific individual injury from the offense (penalties should not fund particular government agencies in ways that incentivize zealous enforcement or insulate the agencies from appropriations oversight);
• prohibit the payment of public lawyers and forensics experts on contingency, that is, in ways dependent on case outcome or the magnitude of penalties (this principle should apply alike to career prosecutors, other staff public lawyers, experts, and outside law firms); existing contingency arrangements should be terminated;) and
• impose transparent principles of selection and payment on outside contracting for legal services.

Prosecution: A Climate of Abuse

“The increasing criminalization of corporate behavior in America,” noted The Economist in 2014, “is bad for the rule of law and for capitalism.” In fact, the British weekly noted, prosecution as a means of regulating business in the United States has become “an extortion racket… . The formula is simple: find a large company that may (or may not) have done something wrong; threaten its managers with commercial ruin, preferably with criminal charges; force them to use their shareholders’ money to pay an enormous fine to drop the charges in a secret settlement (so nobody can check the details). Then repeat with another large company… .

“Perhaps the most destructive part of it all is the secrecy and opacity. The public never finds out the full facts of the case, nor discovers which specific people — with souls and bodies — were to blame. Since the cases never go to court, precedent is not established, so it is unclear what exactly is illegal. That enables future shakedowns, but hurts the rule of law and imposes enormous costs.”

Many abuses arise from prosecutors’ search for publicity and glory. These include splashy raids on offices and “perp walks” for executives, in situations where a simple request to cooperate would have sufficed, and manipulation of the media through leaks and prejudicial publicity.

The most natural way to address prosecutorial abuse might seem to be disciplinary sanctions based on traditional standards of legal ethics and applied by judges or bar panels. The trouble with relying on that solution is that few prosecutions of large businesses eventuate in trial before a judge. When a business does put up a fight, it sometimes wins big. In 2016, after the Department of Justice (DoJ) indicted the FedEx Corporation on charges that it had knowingly done business with illegal pharmacies, FedEx refused to settle; once before a judge, DoJ’s case collapsed in spectacular fashion and it dropped the charges midtrial. Much more often, however, businesses faced with a doubtful or overreaching prosecution take their lawyers’ advice and fold their hands and try to get the best possible settlement. For businesses based on trust or regulatory permission, the costs and risks of defying federal law enforcement — legal, reputational, and otherwise — are just too high. The government has the upper hand. That is one reason lawmakers need to step in.

Overcriminalization and the Need for Clear and Compliable Law

There are now more than 4,000 federal criminal offenses, up from approximately 165 in 1900, 2,000 in 1970, and 3,000 in 1982, along with hundreds of thousands of regulations backed up by criminal sanction.

Under the rule of law, citizens should be able to arrange their actions so as to avoid the commission of crimes. Yet the proliferation of highly technical laws, many going beyond the prohibition of intrinsically wrongful acts, makes it more likely that even a careful business with thousands of employees will commit some violations — especially if criminal infraction of regulations can be assessed without reference to mens rea (i.e., guilty intent).

As Sen. Ted Cruz (R‑TX) has written, “Congress should enact legislation that requires the government to prove the defendant knowingly violated the law — or that, at least, allows a ‘mistake of law’ defense — for certain classes of crimes that have no analog in the common law or that no reasonable person would understand to be inherently wrong. Where the government has criminalized non‐​blameworthy conduct for regulatory purposes, ignorance of the law should be a valid defense to criminal liability.”

Four Outrageous Business Prosecutions

• “When I got there, there were people in SWAT attire that evacuated our entire factory.” Thirty federal agents raided the headquarters of Nashville’s legendary Gibson Guitar, carting away a fortune in wood and instruments and interrogating staff without benefit of a lawyer. The charge was that the company had used small quantities of imported wood without doing enough to ascertain suppliers’ compliance with a federal law called the Lacey Act. Gibson’s chief executive officer — who “had not received so much as a postcard telling the company it might be doing something wrong” — got a letter the next day warning him that if he so much as touched any guitar left in the plant he could be charged with a separate federal offense, with possible jail time, for each “violation.” After much press coverage sympathetic to the company, the feds settled for a relatively low $300,000, a sum far below what Gibson would have been likely to pay in legal defense, and returned the seized instruments.
• The federal government extracted more than a billion dollars from Toyota in a settlement, even though its own engineers at the National Highway Traffic Safety Administration cleared the Japanese automaker of charges that its cars were subject to runaway acceleration. The penalties were mostly premised on minor regulatory infractions unrelated to any injuries or accidents. The Department of Justice’s press announcement employed language suggesting that the problem of mechanical acceleration had been real, though Washington had good reason to know better.
• The federal government and various states, notably New York, launched enforcement actions against major banks whose actions, it was alleged, had helped propel the mortgage bubble and crash of 2008. No one really knew, and no court ever decided, whether the charges were true or what a suitable penalty level might be. When the dust settled, major banks had agreed to pay record settlements, some going to investors and consumers, but with hundreds of millions also going to nonprofit organizations that the various law enforcement officials saw as worthy causes — which, in the case of the Obama administration and the attorney general of New York, happened also to be close political allies.
• Several small family‐​owned retailers, including a Maryland dairy farm, a Detroit‐​area grocery, and a North Carolina convenience store, violated the little‐​known federal “structuring” law, which prohibits depositing money into banks in sums under $10,000 so as not to trigger a paperwork filing to the government, even when no tax or other laws are being evaded in the process. Federal agents seized the families’ bank accounts. With volunteer legal help, and amid public outcry, all three businesses managed to get their money back. But many other small businesses swept up by the same law, sometimes unable to pay lawyers because of the freeze on their assets, had by that time capitulated to large forfeitures.

The situation is even worse when laws are so vague that even reading them does not give fair notice of what they prohibit. Courts are inconsistent about applying the “rule of lenity” (ambiguities should be resolved against finding guilt) and the “void for vagueness doctrine” (laws can fail constitutional muster if they leave too much doubt about what they prohibit). As a result, certain areas — including federal mail and wire fraud, “honest services” fraud, antitrust law, and securities law — have proved particularly resistant to clarification.

In recent years, the U.S. Department of Justice has also sought to expand something called the “responsible corporate officer doctrine.” That doctrine allows the government to hold executives criminally liable for the sins of the corporation generally, even when those executives have not been shown to personally hold a guilty state of mind. Although the doctrine somehow passed muster at the U.S. Supreme Court in the cases of United States v. Dotterweich (1943) and United States v. Park (1975), it is ripe with potential for injustice.

Settlements and Slush Funds

Deferred prosecution agreements (DPAs) and their close relatives, nonprosecution agreements (NPAs), have become a major tool of white‐​collar prosecution in recent years. Typically, in exchange for avoiding trial, a business defendant agrees to some combination of cash payment, agreement to change behavior, and submission to future oversight by DoJ. Often, DoJ assigns “monitors” with broad, vaguely defined powers to oversee the affairs of defendant companies and report back to Washington on an ongoing basis.

NPAs at the federal level date back only to 1992. But they have multiplied rapidly, from 1 or 2 a year in the nineties to more than 30 a year during the Obama administration. Since 2010, 16 of the largest U.S. businesses have come under Department of Justice supervision, with tens of billions of dollars extracted in settlements.

Notably, in these agreements, a business defendant may pledge to alter its future course of action in ways that a court would never have ordered had the case gone to trial but that the government is interested in extracting as concessions. These deals may have the effect, or even the aim, of helping or hurting third parties who have the ear of the government, such as customers or competitors of the targeted defendant.

“Without any adjudication to establish wrongdoing and without any judicial oversight, businesses have agreed through these settlements to remove or replace key officers and directors; to change sales, marketing, or compensation plans; and to appoint new officers or independent ‘monitors’ reporting to prosecutors but paid by the companies,” write James Copland and Isaac Gorodetski. The two argue that this process adds up to a “shadow regulatory state” lacking many of the administrative law protections of the visible regulatory state. Appointed monitors, in particular, can wield ill‐​defined but wide‐​ranging power with little accountability if it is put to heavy‐​handed use.

What to do? The United Kingdom took an early lead with its 2013 Crime and Courts Act, which, among other provisions, directs judges to determine that the provisions of DPA equivalents are “fair, reasonable, and proportionate.” In the U.S. Congress, a proposal called the Accountability in Deferred Prosecution Act of 2014 attempted to pursue similar principles. Much more is needed if U.S. law is to catch up with the institutional reality of a Department of Justice that has become the nation’s most powerful business regulator without anyone’s having designed it that way.

At base, the case for civil liberties in the business world is much the same as the case for civil liberties generally. Businesses deserve impartial prosecution in the interests of justice, not merely scoring wins for the government; speedy trial and clear exposition of charges; determination of guilt on an individualized, not group, basis; no excessive punishment; protections against baseless search and seizure; and, in general, the full range of due process protections. The marketplace, like the rest of American society, deserves the full protections of the U.S. Constitution.

Suggested Readings

American Legislative Exchange Council. “Criminal Intent Protection Act,” amended May 6, 2016, and “Treating Accused Persons Fairly Act,” amended May 6, 2016. Model Policy. Arlington, VA: American Legislative Exchange Council, 2016.

Carpenter, Dick M. II, Lisa Knepper, Angela Erickson, and Jennifer McDonald. Policing for Profit: The Abuse of Civil Asset Forfeiture. 2nd ed. Arlington, VA: Institute for Justice, November 2015.

Copland, James R., and Isaac Gorodetski. “The Shadow Lengthens: The Continuing Threat of Regulation by Prosecution.” Legal Policy Report no. 18, Manhattan Institute, February 25, 2014.

—. “Without Law or Limits: The Continued Growth of the Shadow Regulatory State.” Legal Policy Report no. 19, Manhattan Institute, March 26, 2015.

The Economist, “The Criminalization of American Business,” August 30, 2014.

Frank, Theodore H., “Cy Pres Settlements.” Testimony before the House Judiciary Committee, Subcommittee on the Constitution and Civil Justice Examination of Litigation Abuse, 113th Cong., March 13, 2013.

Larkin, Paul. “Regulatory Crimes and the Mistake of Law Defense,” Heritage Foundation Legal Backgrounder, July 9, 2015.

Reddy, Vikrant, and Marc Levin. “Five Solutions for Addressing Environmental Overcriminalization.” Inside ALEC. May/​June 2013.

Shapiro, Ilya, and Randal John Meyer. “Obama’s Weaponized Justice Department” (responsible corporate officer doctrine). National Review, October 30, 2015.

Washington Legal Foundation. “Timeline: Erosion of Business Civil Liberties.” 3rd ed. 2015.


Let’s End Criminalization Without Representation

Originally published at National Review by JIM COPLAND & RAFAEL A. MANGUAL | 1/14/2017

Determining what is and what isn’t a crime should be part of the political process.

In his recent article in the Harvard Law Review, “The President’s Role in Advancing Criminal Justice Reform,” President Obama touts his administration’s successes while blaming Republican leadership for the failure to pass comprehensive criminal-justice reform, one of his administration’s last-year priorities. In the president’s words, the GOP leadership simply has “not yet allowed [reform bills] to come to the floor for a vote.”

The president’s interest in criminal-justice reform is laudable, but his assignment of blame is disingenuous: The lack of legislative progress owes to his unwillingness to compromise and the White House’s own outspoken opposition to Republican priorities. Specifically, the administration and left-leaning allies have opposed any federal efforts to address over-criminalization, or the rapid growth of criminal rules and regulations that punish conduct that is not intuitively wrong, often without regard for the actor’s intent.

One of the core drivers of over-criminalization is that 98 percent of the more than 300,000 crimes on America’s books were never voted on by Congress. We at the Manhattan Institute have dubbed this phenomenon “criminalization without representation.” In our view, it represents one of the most egregious usurpations of power by the state from the people in American history.

According to a count done in 2007, “only” 4,450 federal criminal statutes were on the books. The vast majority of criminally enforceable rules are set out in the Code of Federal Regulations. The CFR’s provisions are the products of decisions made by unelected, politically unaccountable bureaucrats. Contrary to what we were told by “Schoolhouse Rock,” very few criminal laws are debated and passed by Congress and signed by the president. Fewer than 2 percent of criminally enforceable federal rules come from our elected representatives.

This trend is not limited to the criminal law. According to the Competitive Enterprise Institute, for every law Congress passes, federal agencies create 18 rules.

Though this practice has been normalized over the past few decades with the growth of the modern regulatory state, it is a sharp departure from our nation’s philosophical roots. Elected representatives — and, by extension, those they represent — have not had a meaningful say in whether conduct should be criminalized. The Declaration of Independence specifically states that the government’s just powers are derived “from the consent of the governed.”

By taking crime creation almost entirely out of the political process, the government has stripped the governed of the opportunity to consent to, or not, the thousands upon thousands of outmoded, obscure, and often overreaching rules that litter the Federal Register — and threaten the unsuspecting citizen with criminal prosecution. The isolation of criminal lawmaking from the political process has also stripped citizens of the ability to hold anyone accountable for the creation of a given criminal offense.

The isolation of criminal lawmaking from the political process has also stripped citizens of the ability to hold anyone accountable for the creation of a given criminal offense.

Some might argue that we haven’t really been denied representation insofar as we can vote out the representatives who engage in the sort of delegation that created the labyrinth of crimes that now exists. Leave aside that we never formally agreed to depart from the traditional political process in the first place; the offspring of delegation outlives the delegators. To undo the consequences, congressional replacements would have to work through a process that their ousted predecessors weren’t required to work through in creating the problem they were elected to fix. That hardly seems efficient or fair.

While the president in his law-review article does identify problems worthy of serious congressional debate, the absence of any reference to the over-criminalization problem is discouraging, and that omission explains the failure of the Obama administration to enact meaningful criminal-justice reform. In light of President-elect Trump’s stated intent to reduce the regulatory burden faced by Americans, his administration ought to give serious consideration to supporting criminal-justice reform legislation that, in addition to addressing issues such as sentencing guidelines and intent requirements, would require Congress to act before a regulation can be criminally enforced. Doing so would put the power to criminalize back in the hands of the people’s representatives, where it has always belonged.


Homemade Ceviche Case Exemplifies Need to Address Overcriminalization

Originally published at The Orange County Register by James R. Copland and Rafael A. Mangual | 11/17/16

Mariza Ruelas, a single mother in Stockton, California, is facing possible jail time for offering to sell her homemade ceviche, a Latin American seafood dish, through a Facebook group in which users swap recipes and occasionally swap meals. A man took her up on her offer, but unbeknownst to Ms. Ruelas, he was a government agent working on an undercover sting operation targeting those who sell food without a license.

Ms. Ruelas’s case is part of a trend of “overcriminalization,” a term describing the rapid expansion, and increased complexity, of criminally enforceable rules and regulations regarding conduct that is not intuitively wrong.

At the federal level alone, there are an estimated 300,000 criminally enforceable rules and regulations. The five states we have studied to date in our “Overcriminalizing America” research project average more than 570 percent more sections in their criminal codes than in the Model Penal Code, the template established by leading legal scholars that forms the criminal-law basis for most states, and they are enacting, on average, more than 42 new crimes on the books, each and every year. More than three-fourths of these new crimes have been scattered around state statutes outside the criminal codes themselves. States also regularly outsource the creation of crimes to unelected commissioners, administrative agencies and even private licensing associations.

In 2013, California enacted the California Homemade Food Act, intended to help what the law called “cottage food operations” but still ensnared Ms. Ruelas. Any violation of the law’s multiple provisions — it numbers almost 7,000 words — is a misdemeanor. The law criminalizes food sales for anyone who has not registered paperwork with government authorities, and it prohibits such operations in kitchens that are also used to prepare family meals or wash dishes.

Clearly, Ms. Ruelas violated the express provisions of the act — even though she claims she meant to do nothing wrong. Traditionally, under American law and the British law upon which it is based, the state had to prove a “guilty mind” to prosecute an individual of a crime. Today, however, states regularly prosecute individuals for crimes that specify no necessary criminal intent. Fifteen states follow the Model Penal Code in mandating a default criminal-intent requirement where statutes are silent, but others, including California, assume that if the legislature fails to specify any level of criminal intent, no showing of intent is required.

Individuals acting in good faith like Mariza Ruelas should be able to go through daily life without having to worry about ending up behind bars. California could pursue steps to make its criminal law more manageable by enacting a criminal-intent default standard, requiring legislative votes on any regulatory crimes, or following the lead of other states that have held special legislative sessions or creating commissions to repeal outdated crimes and reform the criminal law. Special attention should be paid to the occupational licensing space.

While not entirely curative, adopting these reforms would represent a meaningful first step toward addressing the overcriminalization problem. Until then, well-meaning citizens like Mariza Ruelas will remain at risk of imprisonment for conduct as seemingly innocent as selling some homemade food for a few extra bucks.

James R. Copland is a senior fellow and Rafael A. Mangual a legal-policy project manager for the Manhattan Institute for Policy Research.


Thank You FedEx, For Standing Up to the Feds

Originally published at Manhattan Institute By James Copland & Rafael Mangual | 6/21/16
US v. FedEx

On Friday, June 17, federal prosecutors made the unusual decision to suddenly drop a drug prosecution after a week of trial, some two years after indictment. The judge in the case, Charles R. Breyer, had expressed skepticism, calling it a “novel prosecution.” And indeed it was: the defendant in the trial was not an individual but the delivery company FedEx-though the government invoked some of the same statutes it’s used to go after the Mexican kingpin “El Chapo.”

Federal prosecutors had accused the package-delivery company of delivering packages that contained pharmaceuticals illegally ordered from Internet pharmacies. As FedEx’s lawyers argued, it is more than strange for a criminal conspiracy to operate “with its name emblazoned on a truck.” Judge Breyer observed that the government had failed to show any ill intent, and he pointedly noted that prosecutors have not gone after the U.S. Postal Service for the same conduct.

The FedEx case was unusual in another respect: it is exceptionally rare for the federal government to criminally prosecute a large corporation. Most often, companies and the Department of Justice agree to a deferred- or non-prosecution agreement that resolves criminal allegations without a trial. Indeed, that is precisely how federal prosecutors dealt with FedEx competitor UPS for the same alleged conduct: in 2013, the same U.S. Attorneys prosecuting FedEx entered into a non-prosecution agreement with UPS.

Deferred- and non-prosecution agreements are the major way in which the Department of Justice interacts with corporations. Since 2010, 17 of the Fortune 100 companies have been operating under the terms of one of these agreements. Last year, the federal government entered into 100-a record. By comparison, the government reached only 142 deferred- or non-prosecution agreements in all of American history prior to President Obama’s inauguration.

Without trial, the Department of Justice collects billions of dollars annually through these agreements-more than $6 billion in 2015. But these hefty levies are the least-unusual parts of these arrangements. Instead, under the terms of a deferred- or non-prosecution agreement, companies make concessions to the government that include dramatic changes to business practices. In its 2013 non-prosecution agreement, UPS agreed to hire a new corporate officer as well as an “independent” auditor who reported to the government. In some cases, companies have been strong-armed into firing senior officers and directors.
Regularly, they agree to new training programs, to modifying sales practices, and to adjustments in employee compensation.

While federal prosecutors regularly insist on such business restructurings for companies to avoid prosecution, none of these “remedies” are authorized by statute or would be available as sanctions upon the company’s conviction at trial. Moreover, in most cases, the federal government has failed to prosecute a single individual for any criminal offense imputed to the corporation. So without any finding of wrongdoing, or any judicial oversight, attorneys in the Justice Department are assuming vast, extralegal regulatory authority. We’ve dubbed this practice “the shadow regulatory state.”

With onerous terms and hefty fines in deferred- and non-prosecution agreements, why do companies so regularly agree to them? Why was the FedEx prosecution so anomalous? Comparing its case with UPS’s agreement is illuminating. In its 2013 non-prosecution agreement, UPS paid the government $40 million. By contrast, in its prosecution of FedEx, the government sought fines of $1.6 billion.

FedEx could afford to take that risk, and fight back, in part because the criminal charges levied against it were fairly ludicrous, but also because the case was easy to understand for its customers. More or less, the shipping company took its customers’ side. As Judge Breyer suggested, the government was essentially asking FedEx to snoop on its customers and open their packages-which has privacy-law implications, in addition to being bad for business.

FedEx was also able to take the government to court because it is not similarly positioned to many other businesses that face collateral consequences from a criminal conviction, or even indictment, which can amount to a corporate death sentence. A defense contractor that loses its rights to enter into government contract, a pharmaceutical company that loses the ability to be reimbursed under Medicare, or a bank that loses its banking license cannot afford to roll the dice and take on the government at trial. Like Don Vito Corleone in The Godfather, the Department of Justice often makes businesses an offer they can’t refuse.

With more than 4,000 crimes in federal statutes and more than 300,000 more crimes specified in various federal regulations, every complex commercial enterprise is inevitably vulnerable to federal prosecution-and thus, given federal prosecutors’ leverage, to oversight through a deferred- or non-prosecution agreement. What that means is that the Department of Justice has sweeping regulatory authority, which according to the D.C. Circuit’s April decision in United States v. Fokker Services, federal judges have next to no power to review.

There’s a place for deferring prosecution. Congress clearly has an interest in combatting crimes committed under corporate auspices. But it makes little sense to give broad powers to reshape businesses, without statutory authorization or judicial oversight, to the English majors with law degrees in the federal Department of Justice.

Congress should act to bring the shadow regulatory state out of the shadows. Until then, we’re just glad FedEx called the government’s bluff and won its case.

Manhattan Institute scholars James R. Copland and Rafael A. Mangual are the authors of a new study, Justice Out of the Shadows: Federal Deferred Prosecution Agreements and the Political Order


Manhattan Report: Justice Out of the Shadows

Originally published at Manhattan Institute by James R. Copland and Rafael A. Mangual | 6/15/16

US v. FedEx


Each year, the Department of Justice (DOJ) and other federal agencies enter into scores of deferred prosecution agreements (DPAs) and non-prosecution agreements (NPAs) with businesses: DPAs involve cases in which criminal charges have been filed, and the DOJ asserts that judicial oversight is limited to ensuring their compliance with the Speedy Trial Act; NPAs are entered into without the filing of any formal criminal charges, and no judge ever reviews their contents. Faced with the threat of criminal charges, most companies agree to settle because the collateral consequences of a conviction (or often, even an indictment) are so harsh—in many cases, they amount to a corporate death sentence.

***UPDATE: Shortly after the publication of this report, which analyzes the government’s prosecution of FedEx in Case Study 3, the government suddenly dropped its case mid-trial. The government’s loss evidences the tenuousness of its theory of the case, but is unlikely to lead other companies to take their cases to trial. For more on this, see: Thank You FedEx, For Standing Up to the Feds


  • Since the beginning of 2010, 17 of America’s 100 largest companies, as ranked by Fortune magazine, have been operating under a DPA or an NPA; in 2015, the federal government entered into 100 such agreements—a record—and companies paid out more than $6 billion under their terms without any guilty plea or adjudication.
  • DPAs and NPAs that the government reaches with companies involve significant oversight and supervision—even dramatic restructurings of business practice, including changing top management personnel and compensation; wholesale modifications of sales and marketing strategies; and the hiring of “independent” monitors with vast oversight powers, paid out of corporate coffers but reporting to prosecutors.
  • DPAs and NPAs raise serious legal and policy issues, including those related to: national sovereignty; free speech; judicial oversight and transparency; and the desirability of deputizing private businesses to undertake law-enforcement activities.

Enforcement Maze: Overcriminalizing American Enterprise Conference

Originally published at NACDL | May 20, 2018

On May 26, 2016, NACDL co-hosted a free law and policy symposium with the U.S. Chamber of Commerce’s Institute for Legal Reform entitled The Enforcement Maze: Over-Criminalizing American Enterprise. The day-long symposium featured key leaders from industry, academy, law and policy across the political spectrum. [Released August 2018]August 07, 2018


Together they addressed the rise of overcriminalization, the inappropriate criminalizing of civil and regulatory matters, why laws need criminal intent requirements, fundamental flaws with the plea bargaining process, criminal discovery abuses and inadequacies of the grand jury process, as well as the use of certain pressures associated with enforcement against business and corporate individuals. House Judiciary Chairman Bob Goodlatte gave the morning keynote address; keynote lunch address was given by former Deputy Attorney General David Ogden; and Senator Orrin Hatch gave closing remarks. Most of the symposium’s panelists prepared original scholarship for this symposium that has been compiled into a compendium published in August 2018.

Enforcement Maze report banner

This Symposium was produced as a joint project of the National Association of Criminal Defense Lawyers, and the U.S. Chamber of Commerce Institute for Legal Reform.

As a follow up to the symposium, on August 7, 2018, NACDL released a compendium of original scholarship by symposium panelists on subjects ranging from deferred prosecution agreements to discovery, and from federal conspiracy law to grand jury reform, and so much more. The compendium also includes remarks delivered by House Judiciary Chairman Bob Goodlatte (VA), former Deputy Attorney General David Ogden, and U.S. Senator Orrin Hatch (UT).

Enforcement Maze report partners


  • The Honorable Bob Goodlatte, U.S. House of Representatives (R-VA 6th District) and Chairman, House Committee on the Judiciary


This panel discussed the inappropriate criminalization of what are truly civil or regulatory/administrative problems/disputes as well as inadequate criminal intent requirements and the problem with strict liability crimes.  

  • Reginald J. Brown, Partner and Chair, Financial Institutions Group, Wilmer Cutler Pickering Hale and Dorr LLP
  • John F. Lauro, Principal, Lauro Law Firm
  • Kate C. Todd, Senior Vice President and Chief Counsel, U.S. Chamber Litigation Center

Moderated by: John D. Cline, Principal, Law Office of John D. Cline


This panel addressed over-charging/overzealous enforcement and the pressures on businesses and individuals under investigation and engaging in plea bargaining, including collateral consequences for companies (debarment, exclusion) and for individuals (jail, loss of licenses). 

  • John H. Beisner, Partner, Skadden, Arps, Slate, Meagher & Flom LLP
  • Beth J. Hallyburton, Assistant General Counsel, GlaxoSmithKline
  • Kurt Mix, Former Deepwater Drilling Engineer, BP America
  • Barry J. Pollack, Member and Chair, White Collar & Internal Investigations Practice, Miller & Chevalier

Moderated by: Harold H. Kim, Executive Vice President, U.S. Chamber Institute for Legal Reform


This TED Talk-inspired presentation discussed the manner in which these two phenomena relied on each other to come to dominate our modern criminal justice system. 

  • Lucian E. Dervan, Associate Professor of Law, Southern Illinois University School of Law


Special Remarks byLisa A. Rickard, President, U.S. Chamber Institute for Legal Reform

Keynote Address 

  • The Honorable David W. Ogden, Partner, Wilmer Cutler Pickering Hale and Dorr LLP and Former Deputy Attorney General of the United States


This discussion featured two legal experts and explore the inadequacies and abuses of two important facets of criminal procedure that combine to create an unfair playing field for persons and entities. 

  • Ross H. Garber, Partner, Shipman & Goodwin LLP
  • Timothy P. O’Toole, Member and Chair, Pro Bono Committee, Miller & Chevalier


This TED Talk-inspired presentation discussed the ways in which federal prosecutors have increasingly pressured corporations to enter into deferred- or non-prosecution agreements that entail not only hefty fines but significant changes to business practices, with no showing of wrongdoing or judicial supervision. 

  • James R. Copland, Senior Fellow and Director, Legal Policy, The Manhattan Institute


This panel explored the impact of the recent “Yates Memorandum” – a directive from Sally Quillian Yates, Deputy Attorney General of the United States, regarding individual accountability for corporate wrongdoing. 

  • Lisa A. Mathewson, Principal, The Law Office of Lisa A Mathewson
  • Matthew S. Miner, Partner, Morgan, Lewis & Bockius LLP
  • Ellen S. Podgor, Gary R. Trombley Family White-Collar Crime Research Professor and Professor of Law, Stetson University College of Law

Moderated by: Barry Boss, Co-Chair, Criminal Defense & Internal Investigations, Cozen O’Connor


This panel addressed the erosion of respect for criminal law, costs incurred by taxpayers, over-incarceration, and the squashing of business ingenuity and growth, and will explore solutions to these problems. 

  • Christopher Bates, Counsel to Senator Orrin Hatch, Senate Committee on the Judiciary
  • Douglas A. Berman, Robert J. Watkins/Procter & Gamble Professor of Law, The Ohio State University Moritz College of Law
  • Joseph Luppino-Esposito, Policy Analyst, Center for Effective Justice & Right on Crime
  • Shana O’Toole, Director of White Collar Crime Policy, National Association of Criminal Defense Lawyers

Moderated by: Jonathan Bunch, Vice President & Director of External Relations, The Federalist Society


  • The Honorable Orrin Hatch, U.S. Senate (R-UT), Chairman, Senate Finance Committee and Former Chairman, Senate Judiciary Committee

Overcriminalization at the Airport

Originally published at Cato Institute by Jonathan Blanks | April 13, 2016

Case: US v. Metcalf

People who fly a lot will invariably have a bad experience at the airport, sooner or later. Delays, cancellations, huge lines, and overbooked flights can wear on people, and sometimes individuals take their frustrations out on an airline employee. And, once in a while, the person goes too far and crosses the line into assaulting that employee.

In no airport in America is assaulting an airline employee legal under state law. The laws against simple assault—that is, unwanted physical contact, often without injury—apply just as much at the terminal gate as they do at your local bar or walking down the street. But, as with seemingly every bad thing that happens, someone wants to make a federal case out of it. Literally.

Senator Maria Cantwell (D‑WA) introduced an amendment to a bill before the Senate to make the simple assault of an airline employee punishable up to ten years in federal prison. This is a problem for a bunch of reasons, but here are two that stick out.

First, the crime lacks what criminal justice folks call a “nexus” to a federal interest. That is, unlike disrupting a flight while on board a plane—which is regulated by federal law and the Federal Aviation Administration—or interfering with a federal government employee—such as a TSA agent or air marshal—there is no particular reason a simple assault of a private business employee triggers federal involvement. If a ticket agent is spat upon or touched without consent by a would‐​be traveler, that agent has every right to call the local (or airport) police and file charges if he chooses. For these reasons, the law is duplicative and unnecessary.

Second, the possibility of ten years in prison is too much for contact without injury. The statute that would be amended included an enhanced penalty to protect TSA employees who are charged with keeping America’s skies safe from would‐​be terrorists. One could argue—indeed, I would—that the original statute includes a penalty too stiff relative to the crime. Most simple assault statutes in the federal code include sentence maximums between six months and one year. It’s hard to understand how an angry person grabbing the arm of a ticket agent walking away from them potentially carries ten times the maximum sentence if that person had instead shoved a member of Congress. (see 18 U.S.C. § 351 (e))

A skeptic might say that, in practice, no one will get ten years for petty actions. Perhaps that’s true, but then why should we make such a sentence possible in the first place?

No one should shove a member of Congress or assault an airline employee, period. Simple assault is a crime already, as well it should be. But as the conversation about mass incarceration and sentencing propriety continues on Capitol Hill, legislators should internalize the lessons learned from years of disproportionate sentencing and overcriminalization.

The federal criminal law should be limited to those crimes that properly fall under federal jurisdiction, demonstrate a particular need that is not being met by local authorities, and, when needed, provide sentences proportionate to the severity of the given crime. This proposed amendment failed all of these aims.


Accidental Felons: The Unwitting Criminal Activity of Average Americans

Originally published at Charles Koch Institute | April 12, 2016

According to attorney Harvey Silverglate, the average American inadvertently commits three arguable felonies in a given day. How is possible that Americans could commit so many felonies without knowing it?

Consider this: The U.S. Code—the consolidation of our country’s laws and regulations, broken down into sections such as agriculture (Title 7), banking (Title 11), public lands (Title 43), and more—contains over 4,500 federal crimes and more than 300,000 federal regulations that carry criminal penalties. Rather than being organized together, those crimes and regulations are scattered throughout the code’s 54 titles. Additionally, the states have their own criminal statutes and regulations that carry criminal penalties.

Many of these statutes and regulations criminalize ordinary activities that would not have historically been considered criminal, like shipping lobsters in the wrong packaging or collecting arrowheads from your campground.

While ignorance of the law has never been a sound defense, the sheer number of laws currently on the books—and the fact that crimes are poorly defined and scattered throughout the code—makes it unreasonable to expect the average citizen to be aware of all the activities that could be considered criminal.

Even more troubling is the growing number of statutes and regulations that do not require the government to prove criminal intent in order to obtain a conviction. Historically, a crime consisted of both a guilty act (actus reusand a guilty state of mind (mens rea). But the absence of an intent requirement enables the criminal prosecution of people who have committed acts that are not commonly considered criminal without the necessary level of intent.

Overcriminalization and prosecution without proof of criminal intent erode the rule of law that protects individual liberties and makes the United States an example to many other nations.

New Mexico has distinguished itself as a leader on criminal justice reform by revising its civil asset forfeiture practices. But there is more work to be done. Examining New Mexico’s approach to criminal intent could further the state’s reform efforts by increasing the effectiveness and justness of its criminal justice system.


Heritage Report: The FAA Drone Registry: A Two-Month Crash Course in How to Overcriminalize Innovation

Originally published at The Heritage Foundation by Jason Snead and John-Michael Seibler | 3/8/16

Two months: That is all the time an executive branch agency needs to create a crime.

With passage of the 2012 FAA Modernization and Reform Act, Congress explicitly told the Federal Aviation Administration to leave recreational drones alone, but the FAA has charged ahead anyway. In just two months, with no input from Congress or the public, unelected and unaccountable bureaucrats have devised a way to apply the pre-existing aircraft registration penalties to create a federal felony offense that can result in up to three years in prison and up to $277,500 in fines for failing to register as the owner of a qualifying drone—essentially a toy.

As bad as this is for unwary drone owners, the real legacy of the FAA’s drone registry may be much broader. To justify its rushed regulatory action, the FAA, relying on trumped-up claims about the risk and harms associated with drone use, has asserted its regulatory muscle to protect society from these as yet unrealized dangers. Such thinking has important ramifications for the regulation of innovation and may be only a foretaste of future regulatory actions that deter or dissuade adoption of some new and innovative technologies.

FAA Violation of Rulemaking Requirements

The FAA’s drone registry went into effect remarkably quickly.[1] On October 22, 2015, the FAA published a rule determining that drones are subject to existing aircraft registry requirements.[2] One month later, the agency’s special drone registry task force, composed of government and industry representatives, released a report outlining specific recommendations for a “streamlined” registration process.[3] Three weeks later, the FAA published its “interim final rule” establishing the recreational drone-owners’ registry.[4] Seven days after its release, the rule went into effect, and it officially became a federal felony to operate a drone weighing more than 0.55 pounds without first registering as a drone owner.

From start to finish, the regulatory process took two months to complete.

Agency rulemaking is governed by two primary sources of law: the Administrative Procedure Act (APA) and the Chevron doctrine, which enables agencies to promulgate regulations when Congress has delegated that power with adequate “guidelines.” The FAA registry pushes the boundaries of what an agency can do under both.

The swiftness of the FAA’s drone action was possible only because it bypassed many of the requirements set forth in the APA, which governs most agency rulemaking. Under the APA,[5] administrative agencies must generally publicize their intent to promulgate new regulatory rules by filing a notice of proposed rulemaking (NPRM) in the Federal Register. Interested parties then have from 30 to 60 days to file comments with the agency, which then must consider the public’s input before publishing a final rule. Under the APA, a new regulation generally cannot take effect for at least 30 days after its final publication.[6] This process can take months or years to complete. The requirements of the APA clearly place a premium on public involvement, transparency, and fair notice over swiftness in the regulatory process.

There are exceptions, though, since circumstances can arise that require unusually rapid action on the part of regulatory bodies. To that end, the APA creates a “good cause” exemption to the notice-and-comment process if an agency can show that adhering to the APA’s requirements is “impracticable, unnecessary, or contrary to the public interest.”[7] This is meant to be a narrow exemption, not a way to circumvent the APA’s broader requirements merely for reasons of bureaucratic expediency.

In creating its new drone-owners’ registry, the FAA claimed this exemption,[8] owing to the immediate dangers that the agency has alleged stem from the proliferation of drones in the national airspace.[9] According to the FAA, “it is critical that the Department be able to link the expected number of new unmanned aircraft to their owners and educate these new owners prior to commencing operations.”[10] But there are reasons to doubt the FAA’s claims that drones have suddenly become a problem and that it could therefore not countenance any delay.

  • The rapid growth of small, recreational drones is not new; in fact, Congress legislated on the subject of drone policy in 2012, fully three years before the FAA claimed a sudden exigency to justify rushing its registry into effect.
  • Claims of immediate danger are greatly exaggerated. There is no documented instance of a drone colliding with another aircraft, and it is unclear how dangerous such a collision would be.
  • The number of incidents—interference with emergency services, near-collisions, and other criminal misdeeds—is insignificant compared to the number of drones in circulation. For example, the FAA reported 764 unconfirmed drone sightings near airports or aircraft over an 11-month period at a time when there were possibly as many as a million registry-eligible drones in the hands of consumers.[11]

A full analysis of the FAA’s claimed APA exemption is beyond the scope of this paper, but it is clear that there is reason to doubt the validity of the agency’s claims. In the process of rushing its registry, the FAA exposed hundreds of thousands of drone owners to steep civil and criminal penalties for conduct that is not inherently wrongful and that was not unlawful before the rule went into effect.

The U.S. Supreme Court’s 1984 opinion in Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc.[12] clarified when and how a federal agency can make binding rules.[13] Congress can and often does delegate its legislative power to agencies with guidelines to administer a certain regulatory mission. This enables Congress to write broad legislation and leave the job of filling in the details to agencies. As recently stated by Judge Carlos T. Bea of the U.S. Court of Appeals for the Ninth Circuit, “The basic rule of Chevron deference is that if a statute is ambiguous, the federal agency charged with implementing the statute can issue regulations interpreting it to mean whatever the agency wants within the bounds of that ambiguity.”[14]

A lawsuit has now been filed challenging the FAA drone-owners’ registry, alleging that the rule violates the text and congressional intent of Section 336 of the FAA Modernization and Reform Act of 2012. The plaintiff, John Taylor, claims the registry “creates a burden on hobbyists that Congress did not want to create,” as evidenced by the language of Section 336, which states that “the agency may not create new rules if such model aircraft are ‘flown strictly for hobby or recreational use.’”[15] The nonprofit group TechFreedom has also filed a lawsuit challenging the registry on similar grounds.[16] If either of these lawsuits succeeds, the courts could overturn the drone registration process; if they do not, that task will most likely be left to Congress.

Power to Create the Drone Registry Not Delegated by Congress

Only Congress can enact a federal criminal law.[17] In 1911, however, the Supreme Court held in United States v. Grimaud that Congress could delegate legislative authority to federal agencies to issue regulations and could also enact legislation making it a crime to violate those regulations.[18] More recently, in United States v. O’Hagan,[19] the Court did not object to Congress “authorizing the Securities and Exchange Commission to make rules combating securities fraud and to make violations of these rules crimes.”[20]

But here it seems clear that the FAA was not empowered either to criminalize the failure to register a recreational drone or to require its registration in the first place. While agencies get deference under Chevron to interpret vague and ambiguous statutes, the statute in this instance is not ambiguous, so Chevron should not apply.

In 2014, the Supreme Court declined to hear a criminal appeal in Whitman v. United States. While they agreed with the Court’s decision not to hear the case, the late Justice Antonin Scalia, joined by Justice Clarence Thomas, clarified that “[u]ndoubtedly Congress may make it a crime to violate a regulation, but it is quite a different matter for Congress to give agencies—let alone for us to presume that Congress gave agencies—power to resolve ambiguities in criminal legislation.”[21] While Grimaud and later cases like O’Hagan affirm agencies’ ability to write regulations that implement statutory objectives even where Congress attaches a criminal penalty by statute, “agencies cannot overlook[] the reality that, if Congress wants to assign the executive branch discretion to define criminal conduct, it must speak ‘distinctly.’”[22] In the context of the FAA drone registry, Congress did not so speak.

In the case of the FAA registry, Congress did provide a penalty and defined when it should apply: 49 U.S.C. § 46306(b)(5) provides that the owner of an aircraft “not used to provide air transportation” and “eligible for registration” who “knowingly and willfully operates, attempts to operate, or allows another person to operate the aircraft” is subject to imprisonment for three years and fines up to $250,000.[23] Congress also provided, however, in Section 336 that “the agency may not create new rules if such model aircraft are ‘flown strictly for hobby or recreational use.’” Moreover, Congress has given the FAA the authority to register only aircraft, not aircraft owners, which is how the FAA has set up its drone-owners’ registry to function.[24]

In addition to the fact that the FAA acted unlawfully here, the FAA drone registry merits reconsideration because it needlessly and hastily resorted to criminal penalties when civil fines would have sufficed to satisfy the government’s interests.[25]

A Misuse of Criminal Law

By contrast to the over 300,000 regulatory crimes that exist today, there were only nine felonies at common law, including treason, murder, robbery, and arson.[26] If the FAA’s registration requirement seems out of place when compared with those crimes, it is because criminal laws and regulations are meant to serve different purposes. Criminal laws “enforce the minimum substantive content of the social compact”—“the moral code that every person knows by heart”—“by bringing the full moral authority of government to bear on violators.”[27] Regulations “efficiently manage components of the national economy using civil rules, rewards, and penalties to incentivize desirable behavior without casting aspersions on violations attributable to ignorance or explanations other than defiance.”[28]

Treating such relatively trivial conduct as failing to register a child’s toy the same way we treat “murder, robbery, or theft ‘ignores the profound difference between the two classes of offenses and puts parties engaged in entirely legitimate activities without any intent to break the law at risk of criminal punishment.’”[29] This problem is only compounded by the fact that by the FAA’s own estimates, there may be as many as a million registry-eligible drone owners, and this population grows daily.

Yet the FAA cannot guarantee that all—or even most—of this group is aware of the registration requirement or that they face draconian criminal penalties for failing to comply. Since most people do not think to check with a federal agency before using their latest toy or gadget, this leaves a significant and growing segment of the population needlessly exposed to criminal liability. The explosive growth of federal criminal law and the dramatic expansion of the administrative state have gone hand-in-hand.[30] Regulations like the FAA drone registration requirement generally make it all but impossible for individuals to know which of their toys—or any other things considered potentially “dangerous”—are permissible today but will make them felons tomorrow.

Criminalizing Innovation

The significance of the FAA’s registry extends beyond its immediate impact on drone owners: It sets a precedent for criminalizing other innovations utilizing “emergency” rulemaking procedures premised on overblown claims of harm. While this is a particularly egregious abuse of the criminal law, government has a history of criminalizing or threatening to criminalize innovation under the “precautionary principle,” the belief that “because a new idea or technology could pose some theoretical danger or risk in the future, public policies should control or limit the development of such innovations until their creators can prove that they won’t cause any harms.”[31]

Innovations affected by precautionary government action include commercial use of the Internet (until 1989);[32] an “at-home 99 genetic analysis kit”;[33] 3-D printing;[34] Caller ID;[35] Uber and Lyft, transportation services offered as an alternative to traditional taxi cabs;[36] Airbnb and other short-term home rental companies offering alternative vacation rentals;[37] driverless cars;[38] and FWD (“Skype before Skype was Skype”),[39] which eventually shut down in part because U.S. attorneys “put the reigns on FWD to seek FCC approvals” while “foreign founders of Skype proceeded apace with no regard for U.S. regulatory approvals.”[40]

Criminalizing or otherwise restraining technologies like e-mail sounds laughable today, but e-mails were new and strange once, and like the driverless and Internet-connected cars just beginning to emerge in the market today, people felt that “the more we learn about [them]…the more we’re learning to fear them.”[41] Telephones, too, were new and strange once, but “people quickly adjusted to the new device. ‘Ultimately, the telephone proved too useful to abandon for the sake of social discomfort.’”[42] When the telephone morphed into the cellular phone, the public once again became alarmed over the possibility of cell phone radiation causing cancer. That fear eventually proved to be unfounded, but imagine the consequences and the cost, both social and economic, if the government had banned cell phones until that risk was definitively disproven.

This thinking is antithetical to the core premise of a bottom-up, market-based economy and threatens technological progress, entrepreneurship, and prosperity. Precautionary rulemaking also (ironically for a theory premised on protecting society from unknown harms) leaves society exposed to “existing hazards” that new technologies might otherwise remedy. Drones, for example, might be useful tools in fighting wildfires and providing environmental disaster relief, or detecting threats to community safety, or performing tasks that would otherwise place a human being in danger. Public policies that, based on unproven potential risks, prevent or slow the development of those capabilities force society to forego the opportunity to benefit from social adaptation and repeated trial and error.[43]

Legislators and policymakers are standing by to capitalize on irrational fears or discomforts by introducing new legislation and regulations and claiming that such measures are necessary to protect the public from dangerous unknown technologies when, in fact, those fears are overblown.[44] Often, these claims are hyped to distract from other motives, whether it be protecting an entrenched and politically connected interest, enhancing one’s notoriety, or establishing regulatory purview over an expansive new sector. The public would be better served by policies that allow innovative technologies to be brought to market and that let the market and society sort out the winners and losers.


Drones are one of many emerging technologies that can legitimately be both celebrated and feared. The question becomes: How will government respond to new technologies, and can prosecutors and judges continue to do their jobs without new criminal penalties? Permitting a dynamic, bottom-up approach—where markets and social norms govern individuals’ interactions with new technologies—would be a more efficient regulatory response than a rigid, top-down, criminal law approach that threatens to deprive society of the benefits of innovation.

—Jason Snead is a Policy Analyst and John-Michael Seibler is a Visiting Legal Fellow in the Edwin Meese III Center for Legal and Judicial Studies at The Heritage Foundation. This is the second of five Issue Briefs on how the FAA’s drone registry represents the stifling criminalization of innovation.


The Wrongs of American Justice

Originally Published at National Review by Conrad Black | February 20 2016

Two relatively recent articles in respected publications have piercingly reminded me of what a rotting carcass much of the American legal system has become. The articles were a piece in The Weekly Standard of October 26 by retired attorney Paul Mirengoff and Georgetown law professor and former prosecutor William Otis, and a fawning profile of Judge Richard Posner by Lincoln Caplan (the Truman Capote visiting lecturer at Yale Law School, if such a position can be imagined) in the current issue of Harvard Magazine.  TOP ARTICLES2/5READ MOREWarren Rips Bloomberg for AllegedlyTelling Pregnant Employee to ‘Kill’ It

The basic point of the Mirengoff-Otis article was that mandatory minimum sentences for convicted offenders were “the biggest public-policy success of the last two generations.” The authors hold that legislated, preordained sentencing and “proactive policing” produced a dramatic reduction in crime. It happens that I engaged in a Federalist Society telephone forum on the American justice system with William Otis and Professor Ellen Podgor of Stetson University in Florida in February 2013, and reported on it in this magazine on February 28 of that year. The issue was much broader than mandatory minimums, and the three of us roamed very cordially over a wide range of U.S. criminal-law matters. Familiar though they are to many readers, the concerns I expressed were that American prosecutors win 99.5 percent of their cases, 97 percent without a trial, because the plea-bargain system extorts inculpatory evidence from witnesses in exchange for reduced sentences or immunity from prosecution, including for perjury, and threatens them with prosecution if they decline to cooperate. In practice, this means being catechized by prosecutors in a largely false sequence of allegations against the target. Every informed person in America knows that is how the system operates and nothing is ever done about it.

RELATED: Injustice System: Today’s America Is a Landscape of Legal Abuses

Professor Podgor pointed out that there are now over 4,000 criminal statutes and that new laws and regulations with heavy sanctions are being feverishly adopted every year. The Otis view was that the system was seamlessly perfect and American prosecutors are more successful than prosecutors in other countries because they are more competent. He accepted that the aging of the population, improved police techniques (elevated in his Weekly Standard piece to co-responsibility for the greatest public-policy success of 40 years), and the profusion of security cameras might have helped. But he underestimated the number of incarcerated people in the country by 33 percent and was afflicted by glottal stops, incapable of answering when I asked him whether, since there are 48 million convicted felons in the U.S., he really believes that nearly one-sixth of all Americans and about a third of adult males really deserved to be considered officially as criminals. His silence was more eloquent than the mellifluous whitewash that preceded it.

RELATED: Baltimore’s Problem, and America’s: The Criminal-Justice System Is a Disaster

In the New York Review of Books in 2014, Judge Jed S. Rakoff of the U.S. District Court in Manhattan described the system of American criminal justice as effectively a fraud that no longer exists in practice. Former senator Jim Webb of Virginia has called for a Senate committee to look into the fact that the United States has six to eight times as many incarcerated people per capita as the comparable large, prosperous democracies: Australia, Canada, France, Germany, Japan, and the United Kingdom. Webb told the Senate that either those other countries don’t care about crime, which is rubbish (and they all have a lower crime rate than the U.S.), or Americans are uniquely addicted to committing crimes, which is also bunk, or the American system doesn’t function well. Bingo, but the committee was never established (not that that matters, committees are struck all the time all over the country on these matters but they never accomplish anything), and Webb retired from the Senate. Almost no one cares.

RELATED: America Desperately Need to Fix Its Overcriminalization Problem

The idea that judges are softies who don’t penalize wrongdoers is fatuous, especially in the state courts, where most sentences are handed down and the judges are elected, usually by pandering to the baying for blood orchestrated by Nancy Grace–style lynch mobs that lead most public opinion. In 1960, the United States, like other advanced democracies, had some sort of social balance between the punishment of people who did bad things and the desire to blend deterrence, punishment, and positive encouragement of a reformed offender. The black-radical movement frightened the white majority of Americans, and the feminists sold society and the media on the idea that all men were potential rapists and that even suggestive glances, or indefinable harassment, must be severely punished. Then everyone, from right to left, piled onto the bandwagon: Bobby Kennedy and Nelson Rockefeller were just as extreme as Richard Nixon and Ronald Reagan. As Otis acknowledged in the piece he co-authored, drug crimes are the greatest problem, but many drug offenses aren’t reported or don’t lead to an arrest. So his claims of progress are hollow by his own admission. The War on Drugs has been a complete failure. Drugs are in more plentiful supply and use than ever in the U.S. and the states are already moving toward legalization of marijuana, which morally undermines half the massive increase in convictions. The desire of mismanaged state governments for marijuana revenue can be relied upon to complete the destruction of the Otis-Mirengoff argument.

#share#William Otis told Professor Podgor and me that that if American prosecutors convicted only as large a percentage of the accused as prosecutors in the comparable countries mentioned, “the prosecutors would be reviled for dragging the innocent through ineffectual proceedings.” This is the point: They are committing the greater offense of dragging huge numbers of the innocent through kangaroo courts, where, as he did not (and could not) dispute, there is a huge procedural advantage for the prosecutors, and the judges don’t sentence — they inflict decreed, draconian sentences from the legislators who have rolled over like poodles for the floggers and executioners of the prosecutocracy and the public that has been whipped up to support them. Otis claims that the prospect of relaxation of mandatory minimums, giving judges back a little latitude, has caused the crime rate to start to rise. But the real reason is that a number of police forces, resenting recent media attention to the coast-to-coast shooting gallery they are running in some areas, are conducting what amounts to a work-to-rule, to remind society of the utility of police forces.

The fact that people armed with such absolute power as American prosecutors possess will abuse it is among those “truths” we may consider “to be self-evident.”

William Otis must know as well as anyone that there are revelations every week of heinous wrongdoing by prosecutors: Alaska senator Ted Stevens was found guilty and denied reelection to an eighth term, and the case then collapsed because of the prosecution’s withholding of exculpatory evidence. There was no sanction on the prosecutors (though one of them committed suicide). Judith Miller has shown that Patrick Fitzgerald misconstrued her evidence to convict former vice president Dick Cheney’s then–chief of staff Scooter Libby. In the other countries I have mentioned, Fitzgerald would be disbarred. In the infamous Thompson case of 2011, a man who had spent 14 years on death row, although prosecutors knew him to be innocent from DNA evidence they had withheld, had his award of $14 million damages overturned at the Supreme Court, as prosecutors must effectively have an absolute immunity, even for illegal conduct, apart from whatever penalties the local bar might impose.

The fact that people armed with such absolute power as American prosecutors possess will abuse it is among those “truths” we may consider “to be self-evident.” Despite the good-faith efforts of very many people, the criminal-justice system of the United States is an abomination and a disgrace and a menace to every citizen of the country.

This brings me to the Harvard profile and interview with Judge Richard Posner, who is celebrated as a great “pragmatist” of vast intellectual depth, and a judge so brilliant that there are suggestions of the need for a Nobel Prize for Judicial Thinking, which, if created, should be awarded to Posner. I had an appeal of four convictions (out of 17 original counts) referred to a panel of the Seventh Circuit in Chicago chaired by Posner, in 2007. He obviously had not read the arguments, interrupted three-quarters of the sentences initiated by my counsel — the very respected former deputy solicitor general of the U.S., Andrew Frey — and was simply an extension of the prosecution. We successfully appealed to the U.S. Supreme Court, where Posner was, though not by name, excoriated for his incomprehension of the law. In the perverse American manner, the Supremes vacated the remaining counts but sent them back to Posner and the cigar-store Indians on the panel with him, for the “assessment of the gravity of their errors.” With infinite regret, Posner had to let the two major counts go, but spuriously retrieved two and recommended to the trial judge that she not alter the original sentence. This was too much even for a federal court that had had some pretty un-Solomonic moments, and the sentence was effectively cut in half; the barest fig-leaf remained to protect the credibility of the prosecutors (Fitzgerald and his spear-carriers) and the local federal and appellate bench for this failed and unfounded prosecution.COMMENTS

Given the correlation of forces between the unbeatable and severe American justice system and me, I thought I had done well, and I did some research on the famous Posner, so unimpressive, querulous, and devoid of any insight or wit were his two performances in matters where I was involved. I had read his life of Oliver Wendell Holmes; as a biographer of prominent American public figures, I found it stale, wordy, and banal. I read Posner’s book analyzing the causes of the 2008 economic crisis and promising recommendations, and his chief recommendation was for a “properly funded inquiry” into the causes, hardly an answer to the reader’s curiosity. He also wrote: “I’m a Keynesian,” like President Kennedy at the Berlin Wall. By this, I assume he meant he favors stimulative spending in weak economic times; not even Posner can agree with Keynes’s harebrained theories that there is a natural balance in the economy, or that the imposition of reparations on Germany in 1919 caused World War II. (He doesn’t like history, Caplan writes, presumably because it can impinge on his pragmatism, the license to produce any decision or opinion, however absurd.) But none of it has anything to do with the causes of the 2008 financial crisis. Contrary to Mr. Caplan’s account, Posner is not a good writer — he is inelegant, pedantic, simplistic, self-indulgent, and laborious. He is like an ancient, squawking goose, an intellectual bigot, becoming more acoustically irritating as he exploits his generous sinecure to the last day.

For all his 35 years of inflicting on the legal world a torrent of opinionated excrescences from his throbbing ego, such as his suggestion that adoption of children should be by auction (and, much more sensibly, for the legalization of marijuana), this “pragmatic” Nobel-level philosopher of the law has sat fiddling like Nero, as the Bill of Rights has been shredded. Posner has been as mute as a suet pudding as the Fifth, Sixth, and Eighth Amendment guarantees of due process — the grand jury as an assurance against capricious prosecution, the prohibition against seizure of property without just compensation, access to counsel (of choice), an impartial jury, prompt justice, and reasonable bail — have been destroyed by the prosecutocracy. Apart from some of his thoughts about Yeats, he is essentially a loudmouth, an infelicitous combination of Bacon’s “much-talking judge” and Newman’s seeker of “mere controversy.” He told Caplan he disliked “theology without God” and that he “dislike[s] theology with God.” He’s an atheist who still wants to give his opinion on theology. Someone who knows Posner, and is qualified, should try to ascertain whether his unfocused and often bilious logorrhea is more the consequence of not being proposed for the Supreme Court after decades of striving, or of the fact that, as he said to a New Yorker interviewer 15 years ago, his wife’s cat doesn’t like him. A statue of the cat should be put in front of the Chicago federal courthouse, a palace of corruption and hypocrisy, right beside the plaques in remembrance of judges assassinated, allegedly in acts of vengeance for unjust decisions.

CONRAD BLACK’s latest book is Donald J. Trump, A President Like No Other. He can be reached at [email protected]@conradmblack


As 2016 Begins to Close, Where Is Criminal Justice Reform Heading?

Originally published at Charles Koch Institute

As criminal justice reforms become increasingly common at the state level, the Charles Koch Institute remains committed to ensuring that the best ideas are shared. Though we may have arrived at our current criminal justice system through good intentions, far too many of its features run counter to the basic principles of a free society. And though the reforms seen in 2016 have been promising, there’s still much work to be done.

For one, there’s a need for more data related to policing, sentencing, and corrections in order to assess the efficacy of current policies as well as the viability of new programs. Furthermore, while new state laws and reforms signal gains, federal loopholes still hinder the growth of a free and just society. And although the criminal justice system make seem far away from the average individual, the growing number of regulations and laws with criminal penalties has permeated culture, becoming a very real liability for the average citizen in the 21st century.

Because these are some of the biggest reasons we care about criminal justice reform, the Charles Koch Institute is hosting a series of events to discuss how far criminal justice has come and where reforms should go from here. Here’s what’s coming up:

Safety and Justice in Tennessee: The Right Reforms

There are currently more than 20,000 inmates in Tennessee prisons, and another 70,000 are on probation and parole. Each year, more than 5,000 inmates leave state prisons and attempt to reintegrate into society. With corrections expenditures making up approximately 10 percent of the state budget, all Tennesseans would be better served by a system that prioritizes rehabilitation and reducing recidivism. The private sector can play an especially significant role in providing employment opportunities, which are vital to successful re-entry.

As states continue to enact meaningful criminal justice reforms, there could very well be a place for Tennessee to fit in with the growing movement.

The Charles Koch Institute brings together a panel of experts on September 13 in Nashville to explore reforms that promote public safety, reduce costs, and respect the dignity of individuals while making victims whole.

Click, Click, CLINK: The Computer Fraud and Abuse Act and Overcriminalization in America

Could sharing the password to your Netflix account make you a felon? The recent ruling regarding the Computer Fraud and Abuse Act (CFAA) in United States v. Nosal suggests the answer may be yes. And while recent media attention toward the fact that the CFAA makes it a federal crime to access a computer system without authorization is a good thing, the act’s exact wording, which criminalizes any “unauthorized access” to a computer system or database as fraud, has been in place since 1986.

The wording in the CFAA and the recent ruling in Nosal contribute to what many are referring to as an unprecedented era of overcriminalization, where the growing volume of laws and regulations carrying criminal penalties makes it nearly impossible to discern what is and is not a crime. While specific, intentional criminal actions deserve proportional punishments, millions of Americans could become accidental criminals based on how certain judges and prosecutors choose to interpret the broad wording of the CFAA.

On September 14 in Washington, DC, the Charles Koch Institute will join the Electronic Frontier Foundation for a discussion of recent judicial decisions, the CFAA, and the troubles cause by overcriminalization.

Rebuilding Lives: New Research on Those Re-Entering New York

The effects of incarceration rarely end when individuals return home. Rather, the collateral consequences continue to take a toll, especially on families. New research from Harvard sociologist Bruce Western, faculty chair of the Harvard Kennedy School Program in Criminal Justice Policy and Management, sheds light on those challenges and the sources of support for returning citizens and their families.

On October 18 in New York City, the Charles Koch Foundation, along with the J.C. Flowers Foundation and Harvard University, will discuss Western’s latest findings and determine a path forward.


Not Everything That’s Unseemly Should Be Illegal

Originally published at Cato Institute by Ilya Shapiro and Randal John Meyer

The explosion in criminal statutes is only a part of the problem of overcriminalization. The other side of the coin is prosecutorial discretion: a prosecutor’s official authority to charge certain offenses and not to charge others. The growth of criminal codes, state and federal, gives prosecutors more tools, which allows them to both “stack” charges and expand the reach of criminal code provisions to new, non-criminal facts.

Take for example several recent prosecutions under New Jersey’s official misconduct statute, a felony provision with a mandatory five-year, no-parole sentence.

On its face, the law simply prevents government officials from abusing their offices for personal gain. “Official misconduct” under the statute means an official’s act or omission “relating to his office but constituting an unauthorized exercise of his official functions, knowing that such act is unauthorized or he is committing such act in an unauthorized manner.” Prosecutors have used this broadly worded language in highly creative ways.

In one recent case, New Jersey Superior Court Judge Carlia M. Brady was charged with official misconduct and harboring a fugitive. Judge Brady went to the police on June 10, 2013 to report that her car was stolen and that her then-boyfriend, Jason Prontnicki, was likely involved. As it turned out, Prontnicki was wanted on an outstanding warrant for robbery. The police informed Judge Brady that she was obliged as an “officer of the court” to inform the police as to Prontnicki’s whereabouts. When Prontnicki showed up at her house for brief periods of time on June 10 and 11, Judge Brady informed Prontnicki that he could not stay with her and Prontnicki made clear his intentions to turn himself in with the help of counsel. After both incidents, Judge Brady called the police and left unreturned voicemails. On June 11, police arrested Prontnicki and Brady at her home.

Clearly Judge Brady had violated her duty to report the whereabouts of a wanted criminal suspect, right? The only problem is that such a duty doesn’t exist, either for citizens generally or for judges specifically.

In New Jersey, like most places, the enforcement of arrest warrants is the job of law enforcement officials, such as police. Indeed, the very idea of a judge enforcing the warrants she or her colleagues issue conjures up the ridiculous image of a robe-clad jurist chasing a fleeing suspect while wielding a wooden gavel. The state supreme court has even made clear that judges don’t have an official duty to effectuate arrest warrants.

Yet the prosecutor decided to charge Brady not only with harboring Prontnicki—a dubious move given her clear instructions for him to stay away, the absence of any assistance, and their understanding that he would turn himself in—but with official misconduct. In the prosecutor’s eyes, Brady’s judicial role created a special duty to report and her failure to do so constituted official misconduct—despite clear case law to the contrary and the fact that Judge Brady was on vacation from her official duties when the relevant acts occurred.

The misuse of New Jersey’s official misconduct statute isn’t limited to judges or even executive-branch officials, but reaches teachers.

In two cases, those of Adrian McConney and Nicole McDonough, high school teachers who had sex with adult students were charged with official misconduct. Neither had been accused of promising grade bumps or using their authority to control or initiate the sexual relationship. Because of this absence of the abuse of official power for some sort of quid pro quo, prosecutors in both cases looked to the administrative codes governing teacher conduct to invent a legal duty that was allegedly violated by consensual sexual relationships.

The administrative codes governing educators were not intended to provide the basis for criminal prosecution, and say as much expressly. In other words, these teachers’ extra-curricular activities may be firing offenses (and maybe not — we don’t want to get into employment law and union regulations) but they’re not crimes.

If the prosecutors’ logic were carried to its conclusion, these codes—which require such innocuous things as teachers’ maintaining professional appearance at all times—could result in five-year mandatory no-parole sentences. Every municipal bureaucrat would now have the power to write criminal law via civil guidance; any principal who has a personal conflict with a teacher could threaten prosecution with a savvy interpretation of administrative rules.

Moreover, words in official government guidance would lose all meaning: if the state says that a particular civil code will not be the basis for criminal prosecution, that should be a good indicator to a reasonable person that he or she will not run afoul of criminal laws by violating that code. Due process of law demands sufficient notice of what is criminal before a statue is applied against a defendant.

In both the federal and state criminal-justice systems, prosecutors are quite properly entrusted with discretion to charge appropriate offenses in appropriate cases—but that discretion is abused when the law is made to stretch to cover obviously licit conduct. Whatever one thinks of a judge who fraternizes with shady characters or teachers who have sex with adult students, New Jersey has not seen fit to criminalize either of these behaviors. It’s not the job of prosecutors to gap-fill the criminal code by dubiously extending the reach of criminal provisions such that anything that hints of social impropriety must be criminal.

It’s bad enough when legislatures pass laws to criminalize behavior of which they morally disapprove—as Bill Buckley said, not everything that’s bad should be illegal—but when prosecutors effectively write their own criminal codes, it’s the antithesis of the rule of law.


EPA Criminal Enforcement Policies

Originally published at Washington Legal Foundation by Barry M. Hartman | November 20, 2015

The WLF Timeline notes that in 2005, the Environmental Protection Agency (EPA) started co-locating its civil and criminal offices; it turns out this was just the tip of the iceberg.  There has been a long pattern of convergence of criminal and civil environmental enforcement at EPA, jointly with the Department of Justice’s (DOJ) Environmental Division.  When the difference between a criminal and regulatory offense—the “knowledge” or “scienter” requirement—was clear, a company knew what the stakes were if it was being investigated civilly.  But over the last 25 years, the continuing relaxation of the “scienter” requirement in the environmental arena has blurred that distinction, so that the only articulation an EPA or DOJ lawyer will typically give to that standard is, “I know it when I see it,” allowing the government to use criminal sanctions where administrative or civil penalties would be more appropriate.

More recently, the EPA (and DOJ) has been using administrative and civil processes as tools to develop criminal cases. Both EPA and DOJ are affirmatively encouraging their enforcement lawyers not just to share information, but to use administrative and civil enforcement processes to find evidence that can be used in criminal enforcement prosecutions. This is quite a departure from the historical practice of having two discrete enforcement efforts with different targets, purposes, and goals.

EPA revised its parallel-proceedings policy in 2007 to ensure this coordination between civil and criminal investigations, saying:

This Policy reaffirms and clarifies the earlier policies, while adding procedural mechanisms to enhance effective communications between the Agency’s civil and criminal enforcement programs.

The DOJ Environment Division did the same in 2008:

[A]ny information obtained as the result of legitimate civil and administrative discovery may be freely shared with criminal enforcement attorneys (emphasis added).

EPA has recently used its power to request information administratively under § 114(a) of the Clean Air Act, where DOJ lawyers were “assisting” in the effort, even though no case had been referred to DOJ. In recent cases involving prosecutions for the deaths of migratory birds, the Fish and Wildlife Service has followed the same tactic, using civil and administrative mechanisms to develop criminal cases. The Gulf spill may be the best evidence of this: administrative, civil, and criminal investigators worked hand in hand, and the civil and criminal cases were almost indistinguishable.

The implications for businesses and their employees are profound: how can a company cooperate in even the most routine administrative or civil inquiry when the specter of criminal liability is not just present, but affirmatively being considered and encouraged?  There are far more protections afforded to someone in the criminal context than in a civil or administrative investigation. Most significant among them is that EPA’s administrative investigative powers are broad and often insulated from at least some judicial oversight, yet are used to gather evidence for a criminal case. At least in a criminal case, if an unreasonable grand-jury subpoena is issued, a challenge is possible.

The convergence of parallel proceedings creates a veritable “third rail” in which the liberties of businesses and their employees are threatened.  Among all the developments noted on WLF’s Timeline, this convergence will likely have the most influence in shaping environmental enforcement and its impact into the future.

*Mr. Hartman is a Partner with K&L Gates LLP. He was formerly Acting Assistant Attorney General of the U.S. Department of Justice’s Environment and Natural Resources Division and Senior Vice President and General Counsel of Horsehead Industries, Inc.


Wellcare Case Provides Example of Overcriminalization in Action

Originally published at Cato Institute by Adam Bates | November 19, 2015

Case: Wellcare/Farha v. US

Overcriminalization is not a myth. Labyrinthine regulations often produce absurd outcomes, including prison sentences for individuals who do everything in their power, including consulting multiple attorneys, to comply with the law before acting.

recent op-ed in The Washington Times illustrates the point, using a recent Medicaid fraud case that is currently in front of a federal appeals court:

Here’s a quiz: Which of the following is a federal crime: (a) A hamster dealer needlessly tilting a hamster’s cage while in transit; (b) subliminally advertising wine; or (c) selling a fresh steak with paprika on it?

Give up? The answer: all of the above.

Right now, there are approximately 4,500 federal criminal statutes and 300,000 administrative regulations that can be punished with imprisonment — and the list keeps growing. This is an invitation for our government to over-prosecute. Too often, federal prosecutors are accepting that invitation and rejecting more measured and effective administrative and civil remedies.


In a case that was recently argued before a federal appeals court, executives at WellCare, a managed health care company in Florida, were prosecuted based on their reasonable interpretation of a Florida statute. Federal prosecutors, however, disagreed with the company’s interpretation, even though Florida never issued any regulations contradicting the executives’ reading of the law.

The legal framework WellCare operated in was complex. In a nutshell, Florida’s Medicaid program required managed care companies to report expenses they paid for providing behavioral health care — like mental health services. If the company did not spend at least 80 percent of the premiums they received, they had to return some of the premium dollars to the state. The executives at WellCare read Florida’s requirements as allowing them to classify as expenses the money that WellCare paid to its subsidiary that actually provided all the services.

Florida never clarified the law to say whether this was allowed or not, so WellCare did what businesses do — it consulted a lawyer. And WellCare’s lawyers — both in-house and independent outside counsel — said that the way they were reading the law was reasonable. Other companies providing these services under Florida’s Medicaid program read the law in a similar way. Admittedly, WellCare’s interpretation made the company more money, but, of course, making money is what a corporation ought to do.

Federal prosecutors disagreed and brought criminal charges against its executives. The prosecutors argued that WellCare lied when it sent in expense forms reflecting its reading of the law. At trial, even the government’s witnesses agreed that WellCare’s interpretation of the law made sense. And because this complicated question of how to read a technical Florida health care law was improperly left to the jury instead of the judge, the executives were convicted after a month of stalled deliberations. The company’s reasonable interpretation of a complex law — which was vetted by lawyers — was no sanctuary from a conviction for the company’s executives.

The executives were sentenced to prison up to three years. Yet another company that used the same accounting method was only sued for breach of contract and didn’t even have to pay back any money to Florida.

A federal appeals court has a chance to correct this and uphold a firmly established principle of criminal law: Where a citizen reasonably interprets complex regulatory law, a judge — not a jury — should throw out the case.

Whether prosecutors accuse you of violating Honduran lobster-packing laws even when the Honduran courts insist you didn’t, or prosecute you for assuming that a gun license from one state would be valid in a neighboring state, far too many non-dangerous people end up in prison simply because their reasonable interpretation of the law differs with that of the government.


Deferred Prosecution Agreements; Yates Memo

Originally published at Washington Legal Foundation by Joe D. Whitley | November 18, 2015

Over the past 15 years, Deferred-Prosecution Agreements (DPA) and Non-Prosecution Agreements (NPA) have become a vehicle of choice for resolving complex criminal investigations. This progression is chronicled in the Washington Legal Foundation’s (WLF) “The Federal Erosion of Business Civil Liberties” Timeline. It is commonly believed that DPAs and NPAs are useful tools for prosecutors in investigations of corporations where prosecutors can find no corporate executive directly culpable for any alleged misconduct. DPAs and NPAs permit the Department of Justice to enter into agreements totally outside of courts’ jurisdiction.

Additionally, the traditional use of criminal remedies or indictments to pursue corporate misconduct can result in many potential collateral consequences, including the shattering of many innocent employees’ lives. This consequence was observed in the havoc caused to the employees of Arthur Anderson after Arthur Anderson’s indictment in 2002. That case prompted the growing use of DPAs up to the present day. Some would argue that the pendulum has swung too far in the direction of DPAs and NPAs as the path of choice for prosecutors faced with mountains of documents and complex conduct.

Voices are being raised against DPAs and NPAs by judges, like Judge Richard Leon’s in U.S. v. Fokker Services B.V., with is currently on appeal before the U.S. Court of Appeals for the D.C. Circuit. The Department of Justice has taken notice of these growing concerns and on September 9, 2015, the Department issued guidance that may address the rush to corporate-criminal dispositions that do not consider individual misconduct. This new policy direction is a further iteration of the 2003 Thompson Memo (also noted in the Timeline) that has been revised several times leading up to the latest Individual Accountability for Corporate Wrongdoing version, which many are referring to as the Yates Memo.

In the Yates Memo, the Department of Justice has identified six key steps to be used by the leadership of each division within the Department of Justice and in the U.S. Attorney offices in pursing culpable individuals and executives at all levels within a corporation to include the following:

  • In order to qualify for any cooperation credit, corporations must provide to the Department all relevant facts relating to the individuals responsible for the misconduct;
  • Criminal and civil corporate investigations should focus on individuals from the inception of the investigation;
  • Criminal and civil attorneys handling corporate investigations should be in routine communication with one another;
  • Absent extraordinary circumstances or approved departmental policy, the Department will not release culpable individuals from civil or criminal liability when resolving a matter with a corporation;
  • Department attorneys should not resolve matters with a corporation without a clear plan to resolve related individual cases, and should memorialize any declinations as to individuals in such cases; and
  • Civil attorneys should consistently focus on individuals as well as the company and evaluate whether to bring suit against an individual based on considerations beyond that individual’s ability to pay.

Legislative fine tuning of the DPA and NPA process is afoot in Congress, even as some in the Judiciary, such as Judge Leon, want to reign in the power of prosecutors. These efforts by the Legislative and Judicial branches are laudable; however, I would argue for the advancement of the current internal policy reassessment of the DPA and NPA process within the Department of Justice and in the 93 U.S. Attorneys Offices that is both explicit and implicit in the Yates Memo.

As noted, criminal investigations of corporations are both costly and lengthy, leading to many unforeseen consequences. DPAs and NPAs have been one way to reduce the burden on prosecutors and investigators and at the same time permitting corporations to survive in the aftermath of employee misconduct. I submit the Yates Memo may be a movement in the right direction. At this moment however, we do not need micromanagement of the Department of Justice in the final months of the current Administration. Instead, beginning in 2017, the new Administration should undertake a review of the entire DPA and NPA process within the Department of Justice. By this time, the new Department of Justice policy advocated by the Yates Memo will have been tested in numerous investigations and prosecutions over the course of a full year. Real data will arise from these applications of the Yates Memo, which commentators, the Judiciary, and Congress can use to measure the need for further oversight of prosecutorial discretion in these matters.

*Mr. Whitley chairs Baker Donelson’s Government Enforcement and Investigations Group. He previously served as Acting Associate Attorney General of the United States and as United States Attorney in the Middle (Macon) and Northern (Atlanta) Federal Districts of Georgia.  Mr. Whitley is a member of WLF’s Legal Policy Advisory Board.


DOJ Crime Prosecution Policies

Originally published at Washington Legal Foundation by Michael Volkov on November 17, 2015

Over the last thirty years, the U. S. Department of Justice has dramatically expanded criminal prosecutions of corporations and individuals, relying on a steady litany of so-called criminal-prosecution policies. Underlying each of these policies are two significant purposes: (1) to replace prior civil and regulatory enforcement with “new” criminal prosecution tools and (2) to provide criminal prosecutors with ever-increasing leverage over companies and individuals to extract criminal fines and pleas.

As one looks at the handy Washington Legal Foundation Timeline chart, the view across each category reveals a disturbing picture. When it comes to criminal prosecutions, we have seen unprecedented expansion of the use of criminal statutes for “new” purposes such as false statements (18 U.S.C. § 101), conspiracy to defraud the U.S. Government (18 U.S.C. § 371), and honest services fraud (18 U.S.C. § 1346), in a manner that stretches them well beyond congressional intent.

As a former prosecutor and now a defense attorney, I have watched this sea change unfold. Civil enforcement, once viewed as a powerful tool, has now been jettisoned in favor of stiff penalties, threats to companies’ very existence, and incarceration of individuals for crimes that 20 years ago were considered, at most, regulatory or civil infractions.

One area this trend has been constrained, thanks in part to WLF’s consistent and powerful advocacy, is enforcement against off-label “marketing.” Federal prosecutors have targeted drug and device companies’ education of practitioners about lawful (and in some instances, essential) uses of their products with increasingly creative criminal-prosecution strategies, some of which have arisen from civil False Claims Act actions. Such prosecutions have compelled numerous companies and their executives to plead guilty to regulatory crimes under the Food, Drug, and Cosmetic Act. Some companies and executives have, with WLF’s help, fought back with preemptive First Amendment lawsuits.

Companies and individuals subject to regulatory regimes in the defense industry, the financial sector, and the healthcare sector have been subjected to criminal threats of prosecution for otherwise “civil” or “regulatory-type offenses. The Justice Department has embraced this trend with the release of criminal-prosecution memos that pay lip service to the preservation and separation of civil-enforcement programs, but in reality license a new and more dangerous use of criminal laws for regulatory purposes.

Gone are the days when our criminal laws were reserved for the worst of the worst actors; instead, criminal investigations are launched in the hopes of convincing companies to “cooperate” and settle for huge financial penalties in order to avoid collateral consequences from a criminal prosecution.

Prosecutors have extraordinary power under this new regime. Criminal cases are typically resolved favorably for the government—and done so expeditiously. Companies and individual that often face severe penalties have no choice but to cooperate and settle or plead guilty in the hopes of avoiding jail.

Traditional civil enforcement has been relegated to a backwater area for Justice Department officials. This new regime has blindly ignored potential pitfalls arising from the improper sharing of grand-jury information for civil enforcement purposes. Parallel investigations of civil and criminal violations are less frequent because prosecutors can use criminal tools, or the threat of criminal prosecution, to force companies to conduct their own internal investigation, report back to the government on their findings, and then have prosecutors dispense justice in the form of corporate settlement or plea agreements.

No longer does the judiciary exercise a meaningful role in the criminal prosecution of companies. In fact, in some specific areas such as foreign bribery or foreign-export sanctions violations, judges rarely have an opportunity to interpret and resolve important statutory issues because so few individuals decide to take a criminal case to trial.

The Justice Department’s latest criminal-prosecution statement, known as the Yates Memorandum on Individual Accountability, further erodes the procedural and substantive boundaries between civil and criminal enforcement matters. The Yates Memo orders civil and criminal prosecutors to coordinate and share information yet again, ensuring that culpable individuals are identified and prosecuted either criminally or civilly.

The Justice Department’s criminalization of enforcement programs is facing greater resistance and calls for reform. With the help of WLF and other organizations, lawmakers are finally paying attention to the impact these enforcement programs have on corporations, shareholders, individuals, the U.S. economy, and the public interest. We can only hope that some meaningful reform occurs to return the proper balance of justice in prosecution of corporations and individuals.

*Prior to entering the private practice of law, Mr. Volkov spent 17 years as a federal prosecutor in the U.S. Attorney’s Office for the District of Columbia. He maintains a highly popular FCPA blog, Corruption, Crime & Compliance.


Mens Rea and Corporate Officer Doctrine

Originally published at Washington Legal Foundation by Matthew G. Kaiser | November 16, 2015

To commit a crime, normally you have to have met two requirements. First, you have to have done something bad. Second, you have to have done the bad thing with a bad intent.

Take mortgage fraud. If you write on your mortgage application that you earn $1,000,000 a year, but you only earn $100,000, you’ve committed mortgage fraud if that’s what you intended to submit and you knew it was false. If, though, you’re using an online application and the “0” key on your keyboard was stuck so an extra zero appeared, you haven’t committed mortgage fraud, you’ve just made a mistake; you have no bad intent.

Accidents happen in lots of ways, which is why something a person does by accident is generally not supposed to be a crime. But that commonsense intuition has been undermined as the mens rea requirement—the requirement that a guilty mind exist before some course of conduct can be a crime—is weakened.

As a result, it’s now easier than ever to become an accidental criminal.

Each branch of government has contributed to this problem in its own way. Congress, in it’s frequent quest to seem ever more tough on crime, has passed more and more statutes that create federal crimes that have no explicit mens rea requirement or do not require a guilty mind at all. The National Association of Criminal Defense Lawyers and the Heritage Foundation did a studyof the legislative activity of the 109th Congress. Considering only proposals that did not involve violence, drugs, guns, pornography, or immigration, they found that 446 new federal crimes were proposed. Of these, 57% did not have an adequate mens rea requirement. And, lest you think these were among the many proposals Congress leaves on the cutting room floor each session, 23 of them ultimately became law.

As the Washington Legal Foundation’s Timeline vividly lays out, the judicial branch has played a role too, slowly eroding the requirement for a guilty mind. The U.S. Court of Appeals for the Ninth Circuit, in United States v. Weitzenhoff, for example, held that a prosecution for a Clean Water Act criminal provision doesn’t require knowledge that what was happening violated an environmental regulation. The U.S. Supreme Court, in United States v. Park, created criminal liability for a corporate officer who is responsible for conduct of any company employee about which she was unaware, but which was later determined to be criminal. The courts have had an opportunity to reign in the Department of Justice and Congress by affirming the requirement of a guilty mind’s place in our criminal statutes as a matter of due process. They’ve largely gone the opposite direction.

The Department of Justice has taken advantage of the opportunity to prosecute with a lower standard of intent. In response to public concern about corporate conduct, they have prosecuted executives and others for conduct that was not the fruit of an evil mind.

The Quality Egg case referenced on the Timeline is an excellent example of the problem of how the lack of mens rea can land unsuspecting people in prison.

Two men ran Quality Egg. That company produced, as its name suggests, eggs. Some of those eggs were contaminated with salmonella, though no one at the company knew it. It’s a crime to put a contaminated egg into interstate commerce, regardless of whether you know the egg is contaminated—that’s a strict liability crime.

So, someone at Quality Egg—the person who actually put the bad eggs into interstate commerce—committed a crime, even though he didn’t know what he was doing was criminal. But the men who ran the company, the DeCosters, were the ones who ultimately were convicted of that crime. Even though they didn’t put the eggs into the stream of commerce, they were in charge of the company. So they were responsible corporate officers under Park.

What made the case truly surprising was that the Department of Justice sought—and the judge imposed—prison time. The DeCosters were sentenced to three months in prison for a crime where they didn’t do anything criminal (they didn’t put the bad eggs into commerce) and where they didn’t intend to violate any law. Instead, they were sentenced to prison merely because of the position they held in a company.

Three months is, to be sure, not the most outrageously long sentence handed down by a federal judge. But it’s also three months longer than anyone wants to spend in prison. Especially when the person didn’t do anything wrong in the first place.

Quality Egg shows why mens rea reform is desperately needed. Executives shouldn’t fear prison simply due to their status as executives.


Regulatory Crimes

Originally published at Washington Legal Foundation by
David Debold | 11/13/15

David Debold, Partner, Gibson, Dunn & Crutcher LLP

Editor’s Note: This is the first in a series of six guest commentary posts that will address the six distinct topic areas covered in Washington Legal Foundation’s recently released Timeline: Federal Erosion of Business Civil Liberties.

Two developments identified in WLF’s helpful Timeline—the proliferation of new criminal laws affecting businesses, and the evolution of federal sentencing law over time—would be topics of significant interest if either had unfolded without the other. The combination of the two, however, has posed a serious threat to the civil liberties of the American business community. Not only have vastly greater categories of conduct become eligible for criminal prosecution, the stakes in such prosecutions—for businesses, their owners, and their leadership—have increased substantially. As a result, conduct that had long been either lawful or merely the basis for a civil or administrative proceeding can now trigger a criminal investigation and prosecution ending with very substantial fines and lengthy prison terms.

There are many explanations for these parallel developments in the law, but the Timeline shows that perhaps the most important factor in the proliferation of new criminal laws is Congress’s decision to give administrative agencies the power to draft regulations that can form the basis for criminal prosecutions. No longer is it enough for businesses to consult the U.S. Code to determine which conduct violates criminal law; they must now wade through the even more dense Code of Federal Regulations to see whether an agency has adopted rules that allow for criminal prosecution if the agency’s requirements are not obeyed. This is particularly worrisome because it pushes the important job of drafting criminal law from our elected representatives to administrative bodies that are far from directly accountable to the people. Moreover, instead of the usual process, in which legislation creating new crimes must pass both houses of Congress and be signed by the President, it now takes only the “vote” of an administrative agency within the Executive Branch to achieve the same result. And with so many agencies separately exercising this power, the number of criminal prohibitions has mushroomed.

WLF Timeline chart

WLF Timeline chart

Our elected representatives share responsibility for this situation in a more direct manner too. Congress often responds reflexively to publicity about potentially blameworthy conduct (think of Enron or the 2008 financial crisis) by creating new federal crimes before carefully considering whether existing laws already made the conduct illegal. (It does little good to expand the scope of conduct subject to prosecution if proper enforcement of existing laws would get at the root of a problem.) As shown elsewhere in the Timeline, this type of congressional reaction has also included a watering down of mens rea requirements, making it easier for prosecutors to turn good-faith disagreements about the lawfulness of certain conduct into fodder for criminal prosecutions.

Similar explanations can be found for the significant upward trend in federal criminal penalties. When Congress criminalizes new conduct, it also tends to “supersize” the penalties—for new and old offenses alike. In response to the infamous savings-and-loan crisis of the 1980s, for example, Congress increased the prison term for many fraud-based bank offenses to 30 years—six times higher than the maximums then in place for mail fraud and wire fraud. And after Enron and WorldCom, Congress passed Sarbanes-Oxley, which included higher statutory penalties for fraud and a directive encouraging the United States Sentencing Commission to beef up the sentencing guidelines ranges for those offenses. In neither instance was there good reason to believe that the problem was an inability to impose harsh enough sentences. In point of fact, a wealth of research data shows that certainty of punishment—not severity—is the key to deterrence, especially in white-collar cases. The decision to increase penalties in Sarbanes-Oxley was particularly unjustified because the Sentencing Commission had just approved higher sentencing ranges for economic crimes that were due to take effect later that year.

For many companies, the threat of a criminal conviction carries so many negative collateral consequences (indictment alone doomed Arthur Andersen) that the only safe option is to pursue a non-prosecution or deferred-prosecution agreement with the government. That development, also chronicled on the WLF Timeline, makes for superb irony. One of the central purposes of the Sentencing Reform Act, which created the Sentencing Commission, was to improve consistent treatment of violators through transparent and principles-based sentencing, with appellate review available to police even-handed application of the law. But as more and more business conduct is criminalized, companies find themselves negotiating settlements with the Department of Justice outside of the usual criminal-justice process in order to avoid a criminal record. Companies therefore find themselves paying huge penalties, not much different from the fines a judge might impose following a guilty plea or trial. The critical difference is that these dispositions occur with little or no court involvement, meaning less oversight for consistency and transparency.

This application of the law of unintended consequences is not a crime (at least not yet), but it certainly is one of the many unfortunate byproducts for our commercial sector of having too many criminal laws with ever-increasing penalties.

Next post, Monday, November 16: Matthew Kaiser on Mens Rea, Public Welfare Offenses, and Responsible Corporate Officer Doctrine


Hatch is Right on Criminal Justice Reform

Originally published at Manhattan Institute by James R. Copland and Rafael A. Mangual | 10/12/15

On Oct. 1, a bipartisan group of senators including Charles E. Grassley (R-Iowa), Dick Durbin(D-Ill.), and Cory Booker (D-N.J.), announced a plan to reduce mandatory criminal sentences under federal law for nonviolent offenders and help former prisoners reintegrate into society. Such an effort is overdue, but insufficient to fully remedy the overreach of federal criminal law. To do so, lawmakers must also bring attention to what we and other reformers have called “overcriminalization” in federal code.

As Sen. Orrin Hatch (R-Utah) pointedly asserted in a Sept. 21 statement, ordinary citizens and small business owners are perpetually at risk of unknowingly violating a federal criminal code that lists some 5,000 crimes in the statutes and creates 300,000 more through agency regulations. Legal analyst and litigator Harney Silverglate estimates that the average American commits three federal felonies a day.

James Madison wrote in the Federalist Papers that it would be “of little avail to the people . . . if the laws be so voluminous that they cannot be read.” Not only is our 80,000-page Code of Federal Regulations far beyond the capacity of ordinary citizens to read and understand, much conduct criminalized under federal law is not intuitively wrong. Consider the following example from Hatch: It is punishable by up to six months in federal prison—six months!—to walk a dog in a federal park area on a leash longer than 6 feet.

Traditional legal principles would protect our hypothetical dog walker. As is still the law in several states, the government traditionally had to show a “guilty mind” (the Latinate legal term is mens rea) to convict someone of a crime. But a joint study of the 2005–06 Congressional session by the Heritage Foundation and the National Association of Criminal Defense Lawyers found that 57 percent of the 446 non-violent criminal offenses proposed lacked an adequate criminal-intentrequirement and 23 percent had no criminal-intent requirement whatsoever.

A vast and complex criminal code, crimes that are not self-evidently wrong, and no required showing of criminal intent for conviction combine to place ordinary citizens in jeopardy for innocent mistakes. For example, former automobile racer Bobby Unser is a three-time winner of the Indianapolis 500, but the sports legend is also a convicted federal criminal. His crime? While driving snowmobiles near Unser’s ranch, he and a friend were caught up in a blizzard, eventually having to abandon their vehicles to survive. Unbeknownst to Unser, they had wound up in a protected federal forest—and driving a vehicle in this forest is a crime that, like the dog-walking rule, is punishable by up to six months in prison. A federal judge and an appeals panel both determined that Unser was guilty because the government did not have to establish criminal intent under the statute.

Fortunately, Unser paid a small fine and avoided jail time, but a less-well-heeled defendant may not have been so lucky. Indeed, average Americans, small business owners, and family farmers are most at risk from overcriminalization, since they cannot afford the teams of elite lawyers that large corporations and billionaires employ to keep themselves out of trouble.

Tackling the size and complexity of the criminal code is a large undertaking, but Congress could take a major step by simply enacting a default rule that presumes the government must show criminal intent. Many states have such a rule—most recently Ohio, which enacted default mens rea legislation in late 2014.

A default criminal intent standard would not tie Congress’s hands to enact laws that made certain actions strictly criminal, even for innocent mistakes. Congress would just have to say so.

To be sure, many federal regulations have a valid purpose, but if the proscribed conduct is not obviously wrong, enforcement should generally be civil. There’s a reason to keep vehicles out of some federal forests, but do we really need to criminalize unknowing incursions during snowstorms, especially when we are talking about possible jail time and “convicted criminal” status?

Protecting citizens from criminal convictions for behaviors most people would not intuitively deem criminal should, like sensible sentencing reforms, appeal to lawmakers on both ends of the political spectrum. Senator Hatch deserves kudos for calling attention to this issue. Let’s hope that the members of both parties were listening.


Excerpts from Sen. Hatch Speech on Mens Rea Reform

Originally published at National Review by Jonathan Keim  | 9/21/15

As criminal justice reform has built momentum in recent months, it has lost some of its focus on overcriminalization issues like mens rea reform and overbreadth. This afternoon Senator Orrin Hatch refocused the coalition on these issues, bringing attention to proposed legislation that would rein in the overly expansive federal criminal code by imposing a default mens rea on all federal crimes.

Here’s why this is important:

We’re a nation of laws, Mr. President. We’re supposed to be guided by the rule of law. Our criminal law—indeed, the very idea that it’s proper to brand some conduct, and some people, as criminal—is predicated on the notion that individuals know the law and are able to choose whether or not to follow it. If, as I have suggested, and as many scholars agree, we live in a country where much otherwise benign conduct has been labeled criminal, and where decent, honorable citizens can become criminals through no fault or intent of their own, then we have a real problem on our hands. Our criminal laws should be aimed at protecting our communities and keeping bad influences off our streets, not tripping up honest citizens.

On mens rea specifically:

Without adequate mens rea protections—that is, without the requirement that a person know his conduct was wrong, or unlawful—everyday citizens can be held criminally liable for conduct that no reasonable person would know was wrong. This is not only unfair; it is immoral. No government that purports to safeguard the liberty and the rights of its people should have power to lock individuals up for conduct they didn’t know was wrong. Only when a person has acted with a guilty mind is it just, is it ethical, to brand that person a criminal and deprive him of liberty.

And on the centrality of mens rea reform for overcriminalization reform:

I look forward to working with my colleagues on this important legislation and urge all of them to give it their support. Any deal on sentencing, Mr. President, and any package of criminal justice reforms, must include provisions to shore up mens rea protections. In fact, Mr. President, I question whether a sentencing reform package that does not include mens rea reform would be worth it. And I am not alone. Many members of the overcriminalization coalition—members who helped lay the key intellectual and political groundwork for the negotiations now underway—believe strongly that any criminal justice reform bill that passes this body must include mens rea reform. I agree.


Heritage Report: The Pressing Need for Mens Rea Reform

Originally published at The Heritage Foundation by John G. Malcolm | 9/1/2015

A number of criminal justice reform proposals have been introduced and are being actively discussed and debated on Capitol Hill these days. Most[1] (but not all[2]) of these proposals involve reforming criminal sentencing practices and prison reform. Notably absent, at least so far, have been any proposals to address mens rea (Latin for a “guilty mind”) reform.

This is both surprising and disappointing given that mens rea reform was a consistent theme throughout the year-long set of hearings conducted by the U.S. House of Representatives Committee on the Judiciary’s Over-Criminalization Task Force. During the task force’s first hearing, when Subcommittee Chairman James Sensenbrenner (R–WI) asked the four witnesses (former Deputy Attorney General George Terwilliger, then-Chairman of the American Bar Association’s Criminal Justice Section William Shepherd, then-President of the National Association of Criminal Defense Lawyers Steven Benjamin, and the author) to name their top priority to address overcriminalization, each said mens rea reform.[3] The task force subsequently devoted an entire hearing to the issue.[4]

One of the greatest safeguards against overcriminalization—the misuse and overuse of criminal laws and penalties to address societal problems—is ensuring that there is an adequate mens rea requirement in criminal laws. While sentencing reform addresses how long people should serve once convicted, mens rea reform addresses those who never should have been convicted in the first place: people who engaged in conduct without any knowledge of or intent to violate the law and that they could not reasonably have anticipated would violate a criminal law. Any reform legislation should address and improve the problems with current law pertaining to mens rea standards as well as sentencing and other areas in need of reform.

Get exclusive insider information from Heritage experts delivered straight to your inbox each week. Subscribe to The Agenda >>

Mens Rea Reform Is a Bipartisan Issue

Prominent Republican and Democratic members of the Over-Criminalization Task Force seemed to agree on the need for mens rea reform. For instance, Republican Chairman Sensenbrenner stated that “[t]he lack of an adequate intent requirement in the Federal Code is one of the most pressing problems facing this Task Force….”[5] Lending his support to the issue, Ranking Member Robert “Bobby” Scott (D–VA) stated:

Themens rearequirement has long served as an important role in protecting those who did not intend to commit a wrongful act from prosecution or conviction…. Without these protective elements in our criminal laws, honest citizens are at risk of being victimized and criminalized by poorly crafted legislation and overzealous prosecutors.[6]

Similarly, during a hearing about the scope of regulatory crimes, Representative John Conyers (D–MI) stated:

First, when good people find themselves confronted with accusations of violating regulations that are vague, address seemingly innocent behavior and lack adequatemens rea, fundamental Constitutional principles of fairness and due process are undermined…. Second,mens rea, the concept of a “guilty mind,” is the very foundation of our criminal justice system.[7]

Following completion of the task force’s hearing, the Democratic members of the task force and the Subcommittee on Crime, Terrorism, Homeland Security, and Investigations issued a report in which they stated:

Federal courts have consistently criticized Congress for imprecise drafting of intent requirements for criminal offenses…. It is clear that the House and Senate need to do better. We can do so by legislating more carefully and articulately regardingmens rearequirements, in order to protect against unintended and unjust conviction. We can also do by ensuring adequate oversight and default rules when we fail to do so.[8]

What Is Mens Rea, and Why Is Reform Needed?

Heritage scholars have written about the need for mens rea reform for some time,[9] and that need is no less pressing today. As former Heritage Senior Legal Research Fellow Paul Rosenzweig stated:

From its inception, the criminal law expressed both a moral and a practical judgment about the societal consequences of certain activity: For an act to be a crime, the law required that an individual must either cause (or attempt to cause) a wrongful injury and do so with some form of malicious intent. In other words, the definition of a crime requires two things: anactus reus(a bad act) andmens rea(a guilty mind). At its roots, the criminal law did not punish mere bad thoughts (intentions to act without any evil deed) or acts that achieved unwittingly wrongful ends but without the intent to do so. The former were for resolution by ecclesiastical authorities, and the latter were for amelioration in the civil tort system.[10]

There are different mens rea standards providing varying degrees of protection to the accused (or, depending on your perspective, challenges for the prosecution). The following recitation of the different mens rea standards is somewhat broad and simplified, and courts often differ in how they define those standards, which can make a huge difference in close cases.[11]

  • The standard that provides the highest level of protection to an accused would be “willfully,” which essentially requires proof that the accused acted with the knowledge that his or her conduct was unlawful.
  • A “purposely” or “intentionally” standard would require proof that the accused engaged in conduct with the conscious objective to cause a certain harmful result.
  • A “knowingly” standard provides less protection, with how much less depending to a great extent on how that word is defined. Some courts have defined the term “knowingly” to mean that the prosecution must prove (1) that the accused was aware of what he was doing (meaning he was not sleepwalking or having a psychotic episode or something of that nature) and (2) that he was aware to a practical certainty that his conduct would lead to a harmful result; other courts have defined the term to require only the former.
  • Yet another mens rea standard would be “recklessly” or “wantonly,” which would require proof that the accused was aware of what he was doing; that he was aware of the substantial risk that such conduct could cause harm; and that, despite this knowledge, he acted in a manner that grossly deviated from the standard of conduct that a reasonable, law-abiding person would have employed in those circumstances.
  • Another standard that does not offer much protection at all would be “negligently,” which requires proof that the accused did not act in accordance with how a reasonable, law-abiding person would have acted in those circumstances. “Negligently” is often utilized in connection with criminal statutes that define mens rea based on what a defendant “reasonably should have known.” Negligence is a term traditionally used in tort law and is extremely ill-suited to criminal law. Arguably, negligence is not a mens rea standard at all, since someone who simply has an accident by being slightly careless can hardly be said to have acted with a “guilty mind.”

Today, nearly 5,000 federal criminal statutes are scattered throughout the 51 titles of the U.S. Code,[12] and buried within the Code of Federal Regulations, which is composed of approximately 200 volumes with over 80,000 pages, are an estimated 300,000 or more (in fact, likely many more) criminal regulatory offenses[13] or so-called public welfare offenses. In fact, it is a dirty little secret that nobody, not even Congress or the Department of Justice, knows precisely how many criminal laws and regulations currently exist.[14] Many of these laws lack adequate, or even any, mens rea standards—meaning that a prosecutor does not even have to prove that the accused had any intent whatsoever to violate the law or even knew he was violating a law in order to convict him. In other words, innocent mistakes or accidents can become crimes.

There are, of course, certain kinds of crimes such as murder, rape, arson, robbery, and fraud, which are referred to as malum in se offenses (Latin for “wrong in itself”), that are clearly morally opprobrious. In dealing with such crimes, it is completely appropriate—indeed necessary—to bring the moral force of the government to bear in the form of a criminal prosecution in order to maintain order and respect for the rule of law.

Some criminal statutes and many regulatory crimes, however, do not fit into this category. Such crimes are known as malum prohibitum (Latin for “wrong because prohibited”). This category of offenses would not raise red flags to average citizens (or even to most lawyers and judges) and are “wrongs” only because Congress or regulatory authorities have said they are, not because they are in any way inherently blameworthy.

In the case of regulations, the matter is even more complicated. Unlike malum in se offenses, which are always wrong and always prohibited absent a limited set of morally justified and well-recognized exceptions (such as a legitimate claim of self-defense in a murder case), regulations allow conduct, but they circumscribe when, where, how, how often, and by whom certain conduct can be done, often in ways that are hard for the non-expert to understand or predict. Such regulatory infractions are enforced and penalized through the same traditional process that is used to investigate, prosecute, and penalize rapists and murderers, even though many of the people who commit such infractions are unaware that they are exposing themselves to potential criminal liability by engaging in such activities.[15]

In 2001, in Rogers v. Tennessee,[16] the Supreme Court of the United States cited “core due process concepts of notice, foreseeability, and, in particular, the right to fair warning as those concepts bear on the constitutionality of attaching criminal penalties to what previously had been innocent conduct.” The threat of unknowable, unreasonable, and vague laws—all of which pertain to one’s ability to act with a “guilty mind”—troubled our Founding Fathers as well. In Federalist No. 62, James Madison warned: “It will be of little avail to the people that laws are made by men of their own choice if the laws be so voluminous that they cannot be read, or so incoherent that they cannot be understood…[so] that no man who knows what the law is today, can guess what it will be like tomorrow.”[17] There is a serious problem when reasonable, intelligent people are branded as criminals for violating laws or regulations that they had no intent to violate, never knew existed, and would not have understood applied to their actions even if they had known about them.

The relationship between criminal law and administrative law dates back to the turn of the 19th century, when Congress established federal administrative agencies to protect the public from potential dangers posed by an increasingly industrialized society and a regulatory framework that included both civil and criminal penalties for failing to abide by the rules those agencies promulgated. Such regulations cover such aspects of our lives as the environment around us, the food we eat, the drugs we take, health, transportation, and housing, among many others. As the administrative state has grown, so too has the number of criminal regulations.

There are, however, important differences between criminal laws and regulations, the most important of which is that they largely serve different purposes.[18] Criminal laws are meant to enforce a commonly accepted moral code that is set forth in language the average person can readily understand[19] and that clearly identifies the prohibited conduct, backed by the full force and authority of the government. Regulations, on the other hand, are meant to establish rules of the road (with penalties attached for violations of those rules) to curb excesses and address consequences in a complex, rapidly evolving, highly industrialized society. This is why they are often drafted using broad, aspirational language designed to provide agencies with the flexibility they need to address health hazards and other societal concerns and to respond to new problems and changing circumstances, including scientific and technological advances.

But while large, heavily regulated businesses may be able to keep abreast of complex regulations as they change over time to adapt to evolving conditions, it is less likely that individuals or small businesses will be able to do so. Such traps for the unwary can have particularly dire consequences if criminal penalties are attached to violations of such regulations.

There is a significant difference between regulations that carry civil or administrative penalties for violations and those that carry criminal penalties. People caught up in the latter may find themselves deprived of their liberty and stripped of their rights to vote, sit on a jury, and possess a firearm, among other penalties that simply do not apply when someone violates a regulation that carries only civil or administrative penalties.

There is also a unique stigma that is associated with being branded a criminal. A person stands to lose not only his liberty and certain civil rights, but also his reputation—an intangible yet invaluable commodity, precious to entities and people alike, that once damaged can be nearly impossible to repair. In addition to standard penalties that are imposed on those who are convicted of crimes, a series of burdensome collateral consequences often imposed by state or federal laws can follow a person for life.[20] For businesses, just being charged with violating a regulatory crime can sometimes result in the “death sentence” of debarment from participation in federal programs.[21]

As is the case with Congress, regulators have seemingly succumbed to the temptation to criminalize any behavior that occasionally leads to a bad outcome.[22] Such individuals, acting out of an understandable desire to protect the public from environmental hazards, adulterated drugs, and the like, believe it is appropriate—indeed, advantageous—to promulgate criminal statutes and regulations with weak mens rea standards or with no mens rea standards at all (so-called strict liability offenses) in order to prosecute and incarcerate those who engage in conduct, albeit perhaps negligently or totally unwittingly, that causes harm to the public. They will cite to the fact that, while a number of commentators have criticized strict liability criminal provisions,[23] the Supreme Court of the United States has upheld the constitutionality of such crimes on several occasions.[24] Such individuals believe, or at least fear, that insisting upon robust mens rea standards in our criminal laws will give a “pass” to those who engage in conduct that harms our environment—most likely, in their view, wealthy executives working for large, multinational corporations.

This argument is misplaced. This is not to deny that bad outcomes occasionally do occur or to suggest that those who engage in conduct that causes harm should not be held accountable. Rather, the appropriate question is how they should be held accountable.

There are dozens, perhaps over a hundred, sites being operated and controlled by one entity that are contaminated with hazardous substances and are on the Environmental Protection Agency’s Superfund List. Should the operators of these sites be prosecuted? Maybe so, but such an outcome is highly unlikely: These sites are operated by the Department of Defense.[25]

In August 2015, employees at a large entity engaged in conduct that caused millions of gallons of contaminated waste water (which stings when you touch it) containing heavy metals, including lead, arsenic, mercury, cadmium, iron, zinc, and copper, to surge into Colorado’s Animas River. It is feared that this could eventually affect Mexico, Utah, and the Navajo nation. New Mexico Governor Susana Martinez surveyed the damage caused by this toxic brew and said, “The magnitude of it, you can’t even describe it. It’s like when I flew over the fires, your mind sees something it’s not ready or adjusted to see.” Should the miscreants who caused this disaster be slapped in irons and branded felons? Again, such an outcome is not likely: This mishap was caused, no doubt unwittingly, by a trained hazmat team from the EPA.[26]

Why Congress Should Act

It is unavoidable that bad outcomes will occur from time to time, whether through willfulness, negligence, or sheer accident; however, the intent of the actor should make a difference in whether that person is criminally prosecuted or dealt with, perhaps severely, through the civil or administrative justice systems. As Oliver Wendell Holmes, Jr., who was later appointed to the Supreme Court, once observed, “Even a dog distinguishes between being stumbled over and being kicked.”[27]

The notion that a crime ought to involve a purposeful culpable intent has a solid historical grounding. In 1952, in Morissette v. United States, the Supreme Court stated:

The contention that an injury can amount to a crime only when inflicted by intention is no provincial or transient notion. It is as universal and persistent in mature systems of law as belief in freedom of the human will and a consequent ability and duty of the normal individual to choose between good and evil.[28]

Some people or entities intentionally pollute our air and water or intentionally engage in other conduct knowing it will cause harm, in which case criminal prosecution may be entirely appropriate. However, if somebody or some entity unwittingly does something that results in harm, say, to the environment or to another person, there is no reason why it cannot be dealt with (even harshly) through the administrative or civil justice systems. This would help to remedy the problem and compensate victims without saddling morally blameless individuals and entities for life with a criminal conviction.

Just this past term, in Elonis v. United States, the Supreme Court emphasized the need for an adequate mens rea requirement in criminal cases. In that case, the Court reversed a man’s conviction for violating 18 U.S.C. §875(c) by transmitting threatening communications after he posted some deeply disturbing comments about his estranged wife (and others, including former co-workers) on his Facebook page that she quite reasonably regarded as threatening.[29]

The Court noted that while the statute clearly required that a communication be transmitted and contain a threat, it was silent as to whether the defendant must have any mental state with respect to those elements and, if so, what that state of mind must be. The Court stated that “[t]he fact that the statute does not specify any required mental state, however, does not mean that none exists” and, quoting from Morissette, observed that the “‘mere omission from a criminal enactment of any mention of criminal intent’ should not be read ‘as dispensing with it.’”[30]

The Court, citing to four other cases in which it had provided a missing mens rea element,[31] proceeded to read into the statute a mens rea requirement and reiterated the “basic principle that ‘wrongdoing must be conscious to be criminal.’”[32] The Court focused on the actor’s intent rather than the recipient’s perception: “Having the liability turn on whether a ‘reasonable person’ regards the communication as a threat—regardless of what the defendant thinks—‘reduces the culpability on the all-important element of the crime to negligence.’”[33] While the Court declined to identify exactly what the appropriate mens rea standard is under that statute and whether recklessness would suffice, it certainly recognized that a defendant’s mental state is critical when he faces criminal liability and that when a federal criminal statute is “silent on the required mental state,” a court should read the statute as incorporating “that mens rea which is necessary to separate wrongful conduct from ‘otherwise innocent conduct.’”[34]

If it were a guarantee that courts would always devise and incorporate an appropriate mens rea standard into every criminal statute when one was missing, there might be no need for Congress to do so. As the Elonis Court noted, however, there are exceptions to the “‘general rule’…that a guilty mind is ‘a necessary element in the indictment and proof of every crime.’”[35] Despite the Elonis Court’s recent warning about the need to interpret mens rea requirements to distinguish between those who engage in “wrongful conduct” and those who engage in “otherwise innocent conduct,” courts (including the Supreme Court) on occasion have upheld criminal laws lacking a mens rea requirement based on a presumption that Congress must have deliberated and made a conscious choice to create a strict liability crime.[36]

Although this is a doubtful proposition to begin with, the moral stakes are too high to leave such matters to guessing by a court as to whether Congress truly intended to create a strict liability offense or, more likely, in the rush to pass legislation simply neglected to consider the issue. And even if a court concludes that Congress did not mean to create a strict liability crime, there is the ever-present risk that a court will pick an inappropriate standard that does not provide adequate protection, given the circumstances, to the accused.

What Congress Should Do

Congress should give greater consideration to mens rea requirements when passing criminal legislation, both to make sure that they are appropriate for the type of activity involved and to ensure that the standard separates those who truly deserve the government’s highest form of condemnation and punishment—criminal prosecution and incarceration—and not some other form of sanction. Absent extraordinary circumstances, it should not be enough for the government to prove that the accused possessed “an evil-doing hand”; the government should also have to prove that the accused had an “evil-meaning mind.”[37]

In addition to beginning the arduous task of undertaking a review of existing criminal statutes and regulations to see whether they contain adequate and appropriate mens rea standards, Congress should pass a default mens rea provision that would apply to crimes in which no mens rea has been provided. In other words, if an element of a criminal statute or regulation is missing a mens rea requirement, a default mens rea standard—preferably a robust one—should automatically be inserted with respect to that element.[38]

It is important to remember that such a provision would come into play only if Congress passes a criminal statute that does not contain any mens rea requirement. Congress can always obviate the need to resort to this provision by including its own preferred mens rea element with respect to the statute in question. Moreover, on those (hopefully rare) occasions when Congress wishes to pass a criminal law with no mens rea requirement whatsoever, it should make its intentions clear by stating in the statute itself that Members have made a conscious decision to dispense with a mens rea requirement for the particular conduct in question. Such an extraordinary act—which can result in branding someone a criminal for engaging in conduct without any intent to violate the law or cause harm—should not be accomplished through sloppy legislative drafting or guesswork by a court trying to divine whether the omission of a mens rea requirement in a statute was intentional or not.

This should not be an onerous requirement, and Congress would not have to use a magic formulation of words to make its intent clear. Congress could, for example, choose to make its intent clear by adding a provision to a criminal statute such as: “This section shall not be construed to require the Government to prove a state of mind with respect to any element of the offense defined in this section.”

Who Will Benefit from Mens Rea Reform?

Will some senior corporate management “fat cats” benefit because stricter mens rea requirements make it more difficult to prosecute them successfully? Possibly. After all, most individuals who fall into that category work in heavily regulated industries and are normally given explicit warnings by government officials, usually as a condition of licensure, about what the law, including potential criminal penalties, requires and therefore cannot reasonably or credibly claim that they were not aware that their actions might subject them to criminal liability so long as they acted with the requisite intent. Moreover, as Heritage Foundation Senior Legal Research Fellow Paul Larkin has noted:

Corporate directors, chief executive officers (CEOs), presidents, and other high-level officers are not involved in the day-to-day operation of plants, warehouses, shipping facilities, and the like. Lower level officers and employees, as well as small business owners, bear that burden. What is more, the latter individuals are in far greater need of the benefits from [mens reareform[39]] precisely because they must make decisions on their own without resorting to the expensive advice of counsel. The CEO for DuPont has a white-shoe law firm on speed dial; the owner of a neighborhood dry cleaner does not. Senior officials may or may not need the aid of the remedies proposed here; lower-level officers and employees certainly do.[40]

Consider two examples. Wade Martin, a native Alaskan fisherman, sold 10 sea otters to a buyer he thought was a Native Alaskan; the authorities informed him that was not the case and that his actions violated the Marine Mammal Protection Act of 1972,[41] which criminalizes the sale of certain species, including sea otters, to non-native Alaskans. Because prosecutors would not have to prove that he knew the buyer was not from Alaska, Martin pleaded guilty to a felony charge and was sentenced to two years’ probation and ordered to pay a $1,000 fine.[42]

Lawrence Lewis[43] was born and raised in the projects of Washington, D.C. Seeking to avoid the fate of his three older brothers who got caught up in the criminal justice system and were murdered, and while caring for his elderly mother and raising two daughters, Lewis worked as a janitor for the public school system, took night classes, and eventually rose to the position of chief engineer at Knollwood, a military retirement home. On occasion, some of the elderly patients at Knollwood would stuff their adult diapers in the toilets, causing a blockage and sewage overflow. To prevent harm to the patients, especially those in the hospice ward on the first floor, Lewis and his staff did what they were trained to do on such occasions and diverted the backed-up sewage into a storm drain that they believed was connected to the city’s sewage-treatment system.

It turned out, however, that the storm drain emptied into a remote part of Rock Creek, which ultimately connects with the Potomac River. This was unbeknownst to Lewis, as acknowledged by the Department of Justice in a court filing. Nonetheless, federal authorities charged Lewis with felony violations of the Clean Water Act, which required only proof that Lewis committed the physical acts that constitute the violation, regardless of any knowledge of the law or intent to violate the law on his part. To avoid a felony conviction and potential long-term jail sentence, Lewis was persuaded to plead guilty to a misdemeanor and was sentenced to one year of probation.

Were Wade Martin and Lawrence Lewis corporate fat cats? Hardly, yet both carry the stigma of a criminal conviction and all of the attendant collateral consequences that flow from that.

When morally blameless people like Lawrence Lewis and Wade Martin unwittingly commit acts that turn out to be crimes and are prosecuted for those offenses rather than having the harms they caused addressed through the civil justice system, not only are their lives adversely affected, perhaps irreparably, but the public’s respect for the fairness and integrity of our criminal justice system is diminished. That is something that should concern everyone.


In 1933, in a classic law review article that coined the term “public welfare offenses,” Columbia Law Professor Francis Sayre stated: “To subject defendants entirely free from moral blameworthiness to the possibility of prison sentences is revolting to the community sense of justice; and no law which violates this fundamental instinct can long endure.”[44] Sadly, that has not proven to be the case. In fact, quite the opposite is true: Such laws have flourished.

To those who would argue that corporate bigwigs might benefit from mens rea reform, Larkin likely would eloquently respond:

To be sure, [mens reareform would] not, and could not be, limited to the lower echelons of a corporation or to persons earning below a certain income. The indigent can demand the appointment of counsel at the government’s expense, but the criminal law has never created a similar divide for defenses to crimes, with some available only for the poor. Just as the sun ‘rise[s] on the evil and on the good’ and it rains ‘on the just and the unjust,’ [mens reareform] will aid senior corporate executives as well as entry-level employees. But any remedy for any of the ills caused by overcriminalization will have that effect. We ought not to reject remedies for a serious problem because the neediest are not the only ones who will benefit from them.[45]

An equally apt and pithier response comes from Representative Bobby Scott, who stated during one of the Over-Criminalization Task Force’s hearings:

The real question before us is how to address not only the regulations that carry criminal sanctions, but also numerous provisions throughout the Criminal Code that also have inadequate or nomens rearequirement.… Addressing and resolving the issue of inadequate or absentmens reaand in all the criminal code would benefit everyone.[46]

The time for mens rea reform is now.

—John G. Malcolm is Director of and Ed Gilbertson and Sherry Lindberg Gilbertson Senior Legal Fellow in the Edwin Meese III Center for Legal and Judicial Studies at The Heritage Foundation.


United States v. Quality Egg

Originally published at Cato Institute by Ilya Shapiro and Randal John Meyer | July 30, 2015

Case: US v DeCoster

It isn’t every day that a person can go to his or her job, work, not participate in any criminal activity, and still get a prison sentence. At least, that used to be the case: the overcriminalization of regulatory violations has unfortunately led to the circumstance that corporate managers now face criminal—not just civil—liability for their business operations’ administrative offenses.

Take Austin and Peter DeCoster, who own and run an Iowa egg-producing company called Quality Egg. The DeCosters plead guilty to violating certain provisions of the Food, Drug, and Cosmetic Act because some of the eggs that left their facilities contained salmonella enteritidis, a bacterium harmful to humans. They were sentenced to 90 days in jail and fined $100,000 for the actions of subordinates, who apparently failed, also unknowingly, in their quality-control duties.

In other words, the “crime” that the DeCosters were convicted of didn’t require them to have put eggs with salmonella into interstate commerce, or even to have known (or reasonably been able to foresee) that Quality Egg was putting such eggs into interstate commerce. It didn’t even require the quality-control operator(s) most directly involved in putting the contaminated eggs into interstate commerce to have known that they were contaminated.

Nearly a century of jurisprudence has held that imprisoning corporate officers for the actions of subordinates is constitutionally suspect, given that there’s neither mens rea (a guilty mind) nor even a guilty act—the traditional benchmarks of criminality since the days of Blackstone. Yet there are about 300,000 regulations that can trigger criminal sanctions. These rules are too often ambiguous or arcane, and many lack any requirement of direct participation or knowledge, imposing strict liability on supervisors for the actions (or inactions) of their subordinates.

In United States v. Quality Egg, the district court ruled that courts have previously held that “short jail sentence[s]” for strict-liability crimes are the sort of “relatively small” penalties that don’t violate constitutional due process.  Such a sentence has only been imposed once in the history of American jurisprudence, however, and for a much shorter time on defendants with much more direct management of the underlying bad acts. Additionally, prison is not the sort of “relatively small” penalty—like a fine or probation—that the Supreme Court has allowed for offenses that lack a guilty mind requirement.

Joining the National Association of Manufacturers, Cato points out in an amicus brief supporting the DeCosters’ appeal that this case presents an opportunity for the U.S. Court of Appeals for the Eighth Circuit to join its sister court, the Eleventh Circuit, in holding that prison sentences constitute a due-process violation when applied to corporate officers being charged under a strict-liability regulatory regime.