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By Sanjay Bhandari, Henry E. Hockeimer, Jr., and Charles A. Stillman
The indictment and trial of famed baseball slugger Barry Bonds for perjury and obstruction of justice drew nationwide attention. The Ninth Circuit Court of Appeals’ April 22, 2015, en banc decision reversing Bonds’ obstruction conviction should also draw attention for the spotlight it shines on the potential for government overreach in investigations, through abuse of the “terrifyingly” vast reach of the obstruction of justice statute (United States v. Barry L. Bonds, No. 11-10669), [enhanced version available to lexis.com subscribers]. The Court’s reversal of Bonds’ conviction provides companies and individuals under investigation more confidence that they can hold the government to its duty to investigate properly without fear of being branded a felon for doing so.
In 2003, forced to testify before a grand jury as a result of an immunity and compulsion order, Bonds answered three hours of questions about his alleged receipt of steroids and other performance-enhancing drugs from trainer Greg Anderson and others. In response to the question, “Did Greg ever give you anything that required a syringe to inject yourself with?” Bonds gave a rambling, nonresponsive answer about being a “celebrity child” who didn’t “get into other people’s business because of my father’s situation.” In 2011, this “celebrity child” answer, labeled “Statement C” in the jury instructions on obstruction of justice, was the sole finding of guilt by the jury, which failed to reach guilty verdicts on numerous other alleged false or obstructive statements. Bonds’ post-trial motions were rejected by the district court, [enhanced version available to lexis.com subscribers], (which nonetheless sentenced him to only one month of house arrest), and in September 2013, his arguments on appeal were rejected by a three-judge Ninth Circuit panel, [enhanced version available to lexis.com subscribers]. On April 22, 2015, however, an 11-judge en banc panel set aside Bonds’ conviction, ending Bonds’ 12-year odyssey through federal investigation and prosecution.
First enacted in 1831, the “omnibus clause” of the obstruction of justice statute (Title 18, U.S. Code, Section 1503, [enhanced version available to lexis.com subscribers], penalizing whoever “corruptly … endeavors to influence, obstruct or impede, the due administration of justice”) remains troublingly ambiguous even after the Court’s action. Unusually, the 11 judges on the en banc panel generated no lead opinion, splintering into five groups: four concurring opinions joining a per curiam opinion, and one dissenting opinion. Each group advanced a dramatically different view about the proper scope of obstruction, including not only differences on judicial tests (whether the test for materiality of obstructive conduct is “natural and probable effect of interfering” or “natural tendency to influence, or was capable of influencing”), but also fundamental differences on breadth.
Judge Fletcher would limit the omnibus clause obstruction to bribery. While unsure precedent allowed his view, Judge Reinhardt would limit it to conduct, and not allow its application to testimony. Judge N.R. Smith (joined by three others) would allow application to nonresponsive statements only when they amounted to a refusal to testify, thus satisfying materiality, while Judge Kozinski (and the four others who joined his opinion) would find materiality met only for single nonresponsive statements that implied a response (e.g., “I’m afraid of needles”), or a set of nonresponsive statements that formed a pattern of irrelevancy showing intent to delay or prevent examination. Judge Rawlinson would have affirmed, deferring to the jury to determine materiality, and objecting to the “three strikes” of the concurring opinions that led her to “cry foul.”
Unfortunately, given the weak jury verdict, bad en banc panel split, and other bad facts, it is unlikely that the government will ask the Supreme Court to clarify the many conflicts and questions left open in the Ninth Circuit’s opinion, likely preferring to live with a tougher obstruction standard in the Ninth Circuit (which now requires a significant pattern of conduct, at least for truthful nonresponsive testimony) than to risk a nationwide dulling of one of its favorite tools.
Broad Rejection of a Duty to Aid the Government
Despite their differences on the limits of obstruction, 10 judges of the Ninth Circuit clearly rejected the government’s attempt to treat Mr. Bonds’ resistance to questioning as criminal obstruction. Judge Fletcher described the government’s reading of the obstruction statute as “terrifying,” quoting from oral argument in which the government lawyer opined that if an appellate lawyer deliberately ducked a question about the trial record by saying they weren’t trial counsel, it would be obstruction. “[R]eal-life witness examinations,” noted Judge Kozinksi, “invariably are littered with nonresponsive and irrelevant answers,” motivated by a range of things from misunderstanding to evasion. These cannot be considered materially threatening to truth-finding: they are expected “road hazards of witness examination.” Drawing from Bronston v. United States, 409 U.S. 352 (1970), [enhanced version available to lexis.com subscribers], a perjury case, several judges firmly placed the burden on the government to obtain a direct statement in response to questioning. It is not the witnesses’ duty to provide a full response, but “the prosecutor’s duty to thoroughly examine the witness.” As noted in Bronston, “To hold otherwise would inject a new and confusing element into the adversary testimonial system we know. Witnesses would be unsure of the extent of their responsibility for the misunderstandings and inadequacies of examiners, and might well fear having that responsibility tested by a jury under the vague rubric of ‘intent to mislead’ or ‘perjury by implication.’”
The issues in the Bonds case recur as risks throughout the field of government investigations and white collar defense. In United States v. Lauren Stevens, RWT-10-694, 771 F. Supp. 2d 556 (D. Md.), [enhanced version available to lexis.com subscribers], for example, the government indicted a pharmaceutical company’s in-house attorney for not including certain materials in a production for a Food and Drug Administration investigation into off-label promotion, and for advocating for a favorable view of the evidence. The District Judge dismissed the case, rejecting the notion that the in-house attorney lacked freedom to consider how harmful information could be minimized and characterized. As another example: in defending a broad view of conspiracy to obstruct the IRS, the government argued that “people have a duty ‘not to conduct their business affairs in such a manner that the IRS would be impeded and impaired in its...collection of revenue.’” United States v. Caldwell, 989 F.2d 1056 (9th. Cir.1993), [enhanced version available to lexis.com subscribers], (also quoting government oral argument “if what you're doing, legal or illegal, is intended to impede and impair the Internal Revenue Service...that constitutes a crime.”). The Court was not persuaded: “Fortunately, the United States is not such a place, and we plan to keep it that way.”
It has become commonplace for large-scale government investigations to wind up with perjury or obstruction prosecutions, but no charges for the substantive matters under investigation. While some suggest this is reflective of a perjury “epidemic” that is throwing sand in umpires’ eyes across the country and damaging our system of justice, a long line of precedent views government pursuit of such prosecutions as vindictive, damaging to public respect for the system, and contrary to the adversary system. Both the specific issues and the broader themes discussed in Bonds should aid counsel in responding to an investigation not as a deputy of the government, but the client’s advocate. Rambling “celebrity child” answers and the like should not provoke prosecutors to search for ways to punish, but instead to search for effective ways of carrying out their duties, mindful of their role in an adversary system of justice.
Ballard Spahr's White Collar Defense/Internal Investigations Group regularly counsels and represents individuals, companies, and organizations facing actual or threatened government enforcement, including grand juries; conducts internal investigations; and designs preventive compliance programs. For more information, please contact Sanjay Bhandari at 619.487.0781 or email@example.com, Henry E. Hockeimer, Jr., at 215.864.8204 or firstname.lastname@example.org, or Charles A. Stillman at 212.223.0200 or email@example.com.
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