Supreme Court 'honest services' ruling unlikely to affect county corruption case

View full size [2]Gus Chan, Plain Dealer fileFBI and Internal Revenue Service agents raided the offices of county Commissioner Jimmy Dimora and Auditor Frank Russo in downtown Cleveland in July 2008.

WASHINGTON, D.C. -- The U.S. Supreme Court's decision [3] Thursday to curtail federal prosecutors' use of an anti-fraud law is unlikely to affect the on-going public corruption case in Cuyahoga County.

In Cleveland, more than two dozen government officials and business leaders have been charged in various bribery and kickback schemes [4].

"In the county corruption investigation, we have not charged anything that would violate the holding in the Skilling case," said Ann Rowland, the Cleveland-based assistant U.S. attorney handling the corruption probe here.

The justices voted 6-3 to keep the law in force, even as they joined unanimously in weakening it, and left it to a lower court to decide whether Skilling and Conrad Black, the former Canadian media mogul, should have their convictions stemming from "honest services" fraud overturned.

The honest services law has been criticized by defense lawyers as the last resort of prosecutors in corruption cases that lack the evidence to prove that money is changing hands. It also has been called vague, subjecting people to prosecution for mistakes and minor transgressions in the business and political worlds. But watchdogs consider it key to fighting white-collar and public fraud.

Melanie Sloan, executive director of the government watchdog group Citizens for Responsibility and Ethics in Washington, said the decision "deprives prosecutors of an important tool in their efforts to fight public corruption. Previous convictions may be vacated and corrupt officials will have an easier time escaping accountability for their misdeeds."

The court, in an opinion written by Justice Ruth Bader Ginsburg, said prosecutors may continue to seek honest services fraud convictions in cases where they put forward evidence that defendants accepted bribes or kickbacks.

View full size [5]Marvin Fong, Plain Dealer fileAssistant U.S. Attorney Ann Rowland

That is why even though Rowland said local investigators have not pursued honest services charges in the probe here, it appears they could use the law in the case if they wanted to do so.

The years-long investigation has focused primarily on public officials -- from top county officials to suburban school officials -- accepting bribes and kickbacks for services and contracts, according to plea agreements and other court records.

Ginsburg said that "because Skilling's misconduct entailed no bribe or kickback, he did not conspire to commit honest-services fraud under our confined construction" of the law. Three justices, Anthony Kennedy, Antonin Scalia and Clarence Thomas, would have found the law unconstitutional.

Thursday's decision does not necessarily mean that any of the 19 counts against Skilling or four counts against Black will be thrown out, Ginsburg said. At the same time, by a 6-3 vote, the court rejected Skilling's claim that he did not get a fair trial in Houston because of the harsh publicity surrounding the case in Enron's hometown.

It is unclear whether any convictions will be overturned or prison sentences reduced as a result of the decision, lawyers familiar with the fraud law said. Determinations will have to be made case by case.

But there is no doubt how important the law has been to prosecutors. Supreme Court nominee Elena Kagan said recently that the honest services cases at the high court were the ones that mattered most to the Justice Department.

Honest services charges have figured in convictions won against former Govs. George Ryan of Illinois and Don Siegelman of Alabama, and former Reps. Randy "Duke" Cunningham of California, William Jefferson of Louisiana and Bob Ney of Ohio.

Former New York Senate leader Joseph Bruno is facing two years in prison after being convicted under the same federal statute, and the judge in his case said he is reviewing the court's decision. Former Illinois Gov. Rod Blagojevich faces honest services charges in his ongoing trial, although the judge in that case said Thursday the high court ruling might not be of much help to Blagojevich.

Honest services charges also have been used regularly in public corruption cases stemming from the Jack Abramoff lobbying scandal, including in the pending retrial of former Abramoff associate Kevin Ring.

Plain Dealer Reporter John Caniglia contributed to this story.

http://blog.cleveland.com/metro/2010/06/supreme_court_honest_services.html [6]

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