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07.16.2015 Public Officials Face Greater Scrutiny in Wake of McDonnell Decision By: Charles E. "Chuck" James, Jr.

Governor McDonnell’s attorneys put it this way:  The Governor’s acts weren’t “official” because “none were any more remarkable than acts that governors unthinkingly take hundreds of times weekly for countless constituents, and . . . [the constituent in question] never came close to receiving any actual benefit from Virginia’s government.”[1]  More than 40 current and former Attorneys General – of both political parties – and nearly 20 law professors filed briefs in agreement with the Governor’s position.

The United States Department of Justice saw things differently:  “The United States adduced ample evidence from which a rational jury could find that defendant accepted [the constituent’s] largess in exchange for official action. Indeed, the trial evidence overwhelmingly showed that defendant accepted [the constituent’s] personal payoffs as part of a corrupt agreement to retain defendant’s services on an as-needed basis, so that whenever the opportunity presented itself, defendant would use his gubernatorial power to take specific action on [the constituent’s] behalf.”[2]  And, unfortunately for Governor McDonnell, the Fourth Circuit Court of Appeals essentially agreed.  In a decision announced on Friday, July 10 the Court completely rejected the Governor’s claims and affirmed his conviction.  See, United States v. McDonnell, No. 15-4019 (4th Cir. Filed July 10, 2015).

It took the Court of Appeals 47 ½ pages before it got to the two arguments “at the core of this appeal”:  (1) the scope of the federal statutory definition of bribery; and (2) whether the Governor’s actions met the Court’s definition.  Id. at 48.  But, when it finally did get to the core issues, the Court gave public officials little comfort that their actions – routine or otherwise – will avoid the scrutiny of federal prosecutors around the country.

Governor McDonnell was convicted under two basic legal theories.  First, the Government alleged that he had violated the honest-services wire fraud statute, 18 U.S.C. §§ 1343 and 1346.  This statute requires that the Government prove a scheme or artifice to defraud another, that is the public, of the “intangible right of honest services.”  Id.at 50 (citations omitted).  Through its ruling in Skilling v. United States, 561 U.S. 358 (2010), the Supreme Court has limited violations of § 1346 to bribery and kickback schemes.  Bribery was the basis of the Government’s first prosecution theory in the McDonnell case.  Thus, the prosecutors were required to prove that the Governor allowed himself to be influenced in the performance of  an “official act” in return for some item of value.

The Government also charged McDonnell with Hobbs Act extortion under 18 U.S.C. § 1951(a).  Here, prosecutors alleged that the Governor improperly obtained property “under color of official right.”  And the Supreme Court, as the McDonnell Court pointed out, has defined extortion by a public official as “the rough equivalent of what we would now describe as ’taking a bribe.’”  McDonnell, at 52 (quoting Evans v. United States, 504 U.S. 255, 260, 268 (1992)).  Thus, the McDonnell Court pointed out, “prosecutions for extortion under color of official right, like prosecutions under other bribery-related statutes, require proof of a quid pro quo.”  Id.  Here again, prosecutors had to demonstrate that the Governor obtained something of value in return for the performance of some “official act.” [3]:

With respect to both the honest services counts and the Hobbs Act counts the trial court instructed as to what constituted an “official act”

The term official action means any decision or action on any question, matter, cause, suit, proceeding, or controversy, which may at any time be pending, or which may by law be brought before any public official, in such public official’s official capacity.  Official action as I just defined it includes those actions that have been clearly established by settled practice as part of a public official’s position, even if the action was not taken pursuant to responsibilities explicitly assigned by law.  In other words, official actions may include acts that a public official customarily performs, even if those actions are not described in any law, rule, or job description.  And a public official need not have actual or final authority over the end result sought by a bribe payor so long as the alleged bribe payor reasonably believes that the public official had influence, power or authority over a means to the end sought by the bribe payor.  In addition, official action can include actions taken in furtherance of long-term goals, and an official action is no less official because it is one in a series of steps to exercise influence or achieve an end.”

Id. at 53-54.  It is here that the competing positions of Governor McDonnell, the attorneys general and the law professors on one side, and the Government on the other side, collide.  Put simply, the Governor and his supporters argued that the trial court’s definition was far too overinclusive and potentially encompassed all of a public servant’s activities as official, “no matter how minor or innocuous.”  Id. at 54.  The Government sought to preserve its ability to look at every act taken by a public official in order to construct a detailed picture of the official’s relationship with the bribe payor and to connect it temporally with actions taken on a particular issue.

 Summarizing at least 101 years of federal case law, the Fourth Circuit declined to exclude any category of interaction from the definition of “official act” by holding that the trial court had adequately cabined the definition to cover only “’decision[s] or actions[s] on any question, matter, cause, suit, proceeding, or controversy, which may at any time be pending, or which may by law be brought before any public official, in such public official’s official capacity.’”  Id. at 54-55.  And it pointed out that official actions need not be defined by statute, written rule or regulation, but may include any action that the public servant customarily performs so long as it relates to a “‘pending question, matter, cause, suit, proceeding or controversy.’”  Id. at 57 (quoting United States v. Jefferson, 674 F.3d 332, 356 (4th Cir. 2012) citing 18 U.S.C. § 201(a)(3)).  More directly, the Court cited to the Supreme Court’s decision in United States v. Sun-Diamond Growers of California, 526 U.S. 398 (1999) (a gratuity case that turned on the definition of the same phrase:  “official act”) by explaining that the Government must demonstrate a “link between the gift in question and ‘some particular official act of whatever identity.’”  Id.at 58. 

The McDonnell Court also rejected other limitations on the definition of official act by declaring that:

  1. An official action can include efforts made in furtherance of a longer-term goal[4];
  2. The solicitation or acceptance of the bribe completes the crime, regardless of whether the recipient completes or even commences the official act that the bribe payor sought to influence;
  3. The official act may pertain to matters outside the bribe recipient’s control;
  4. Mere steps in furtherance of a final action or decision may constitute an “official act”;
  5. A prosecution for either bribery or extortion can be sustained where the government official gave the payor a reasonable belief that he had effective influence over the subject of the payment; and
  6. Most practically, that the trial court was correct in declining to say that “merely arranging a meeting, attending an event, hosting a reception, or making a speech” cannot constitute an official act.  In effect, the Court said, in the right circumstances, these seemingly innocuous and routine tasks can support a bribery or extortion prosecution.

But, the official act must still be accompanied by the “quid pro quo,” that is the specific intent to give or receive something of value in exchange for the official act.  Id.at 74.  The official must have obtained something of value to which he was not entitled in return for the official action.  Id.  And McDonnell’s lawyers argued that a “generalized hope of some unspecified future benefit is not” sufficient.  Id. at 75.  In addressing this argument the Court offered only that either a bribery or extortion prosecution requires that the public servant take a specific action on the payor’s behalf and that it be within the parties’ contemplation at the time of the exchange.  Id.at 77.

The Court then turned to an analysis of the evidence against Governor McDonnell.  Focusing directly on the “quid pro quo issue”[5] the Court noted that the constituent “supplied the ‘quid,’ and plenty of it” in the form of “multiple five-figure payments and loans, expensive getaways, shopping trips, golf outings, and a Rolex watch.”  Id.at 78.  Recognizing the disturbing fact pattern in this case, the Court did not spend much time or space on this issue. 

It was the Government’s obligation to prove corrupt understanding and expectation between the constituent and the Governor that drew the Court’s more detailed analysis.  First, the Court found that the Governor had real authority and responsibility over the entire breadth and expanse of the government of the Commonwealth of Virginia.  As such, the Court attributed to him broad actual power and authority over the issues and decisions of concern to the bribe payor.  Likewise, the Court noted that the Governor was in a position of great influence from which he had access to a “bully pulpit”[6] where he could use his “prominence and influence.”  Id. at 80. 

Next the Court analyzed the actions the Governor took to influence the government of Virginia on behalf of the payor.  Cataloguing meetings, emails, communications with staff and other events, the Court, as the Government had done at trial, laid out a two year timeline demonstrating payments and gifts that were matched temporally with certain actions taken by the Governor on behalf of the payor.  And the Court did all this in the context of the Governor’s friendship with the payor, which was a relatively recent development and which grew out of a desire by the payor to influence the Governor and gain his support for the payor’s project.  Id. at 84-89. 

So how do public officials who must interact with constituents, and how do constituents who wish to gain the officials’ influence and support for projects, grants, legislation, and other matters of public interest, do so in the wake of the McDonnell decision?  Have we entered a world where every action is suspect and a potential basis for prosecution?

There is no question that the United States Department of Justice will see vindication in the Fourth Circuit’s decision.  And there is no doubt that the Public Integrity Section – the Department’s litigating division dedicated to dealing with corrupt public officials -  will continue to develop and pursue cases based upon a survey and review of relationships and events just as they did here. 

Public officials and candidates must understand that we have entered a world where there will be more scrutiny of their conduct and decision-making.  And while we cannot know how any fact pattern will be viewed, certain advisories are in order:

  • Be aware of your sphere of influence.  It is not limited by the statutory authority you hold.  The higher the position you occupy, the greater the reach of your influence and the broader the scope of the problem you face.  If a constituent or donor reasonably believes you have influence over a matter, you do for purposes of Hobbs Act extortion and honest services fraud cases.  Be careful about boasting and bragging about your level of influence as that may come back to haunt you even if your statements weren’t technically true.
  • Your entire relationship to an individual and to an issue will be scrutinized to determine whether you have accepted items of value in return for the exercise of influence as opportunities arise over time.
  • Recognize that the timeline of your decision-making matters particularly when compared to your receipt of items of value and campaign contributions.  And the Department of Justice will take the long view by looking at the duration of your relationship with an individual donor and the range of interactions and exchanges that have occurred recently and historically in that relationship.
  • Make no promises in return for anything of value.
  • Put more succinctly, be wary of your new friends.  Don’t accept gifts from those you have not known long or whose friendship is born of your public service.  And, don’t change the nature of long-standing relationships.  If the relationship wasn’t one involving gift giving before you took office, don’t introduce that into the relationship once you do assume high office.
  • Have others – campaign staff, for example – provide distance between you as the office holder and a donor in order to insulate you from the type of quid pro quo temptation the Governor faced.
  • Jealously guard the trappings of your office and carefully use them to advance larger goals and issues and not narrow interests.
  • Carefully monitor and manage your interaction with your staff and fellow government officials (particularly subordinates).  They will become the witnesses against you on the issue of what you did in return for the item of value you received.  You want those private interactions to reflect the high calling of public service that you publicly espouse.
  • Avoid the risks associated with generous supporters, whatever their motivation.  Assume that anyone willing to give you something significant, wants something significant in return.
  • Rely on the advice of competent and independent counsel as part of your campaigning process and while serving in government.  Consider using outside counsel to vet any relationship involving anything of benefit to you personally or to your family or any request that is narrowly focused to the interests of the person or entity making the request.


[1]  McDonnell’s Opening Brief at 20.
[2]  Government’s Reply Brief at 35-36.
[3]  In order to prove a charge of extortion under color of official right, the Government is required to prove that the defendant (1) was a public official; (2) obtained something of value not otherwise due to him or his public office; (3) obtained the thing of value knowing that it was given in return for some official action; and (4) affected interstate commerce.  Id at 52-53.  Similarly, the federal bribery statute provides that a public official may not “corruptly” demand, seek, or receive anything of value “in return for . . . being influenced in the performance of any official act.”  Id. at 51 (quoting 18 U.S.C. § 201(a)(3)).
[4]  This portion of the ruling repeats the Fourth Circuit’s endorsement of a “stream of benefits” theory of prosecution.  Under this theory the public official can be convicted where he or she “understands that he[/she] . . . is expected as a result of the payment to exercise particular kinds of influence as specific opportunities arise.”  See, U.S. v. Ganim, 510 F.3d 134, 145 (2nd Cir. 2007).  The Supreme Court in Skilling cited with approval a number of stream of benefits cases.  See, 561 U.S. at 413 (citing Ganim, supra, United States v. Whitfield, 590 F.3d 325 (5th Cir. 2009); and United States v. Kemp, 500 F.3d 257 (3rd Cir. 2007)).
[5]  There really was little dispute about the other elements of either the honest services or Hobbs Act extortion charges.  The case turned factually on this issue.
[6]  The Court quoted with approval the testimony of one key witness who used this term to describe the reason why the payor wanted the active support of the Governor for his product and project.

 

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