Case o' The Week: Encore, Encore - Prosecutorial Misconduct Means Brocade Retrial (maybe), Reyes

Just how many Ninth Circuit prosecutorial misconduct decisions must come down in one week to deter improper AUSA closing arguments?

More than two, apparently. United States v. Reyes,_ F.3d __, No. 08-10047, 2009 WL 2501920 (9th Cir. Aug. 18, 2009), decision available here.

Players: Decision by Judge Schroeder.

Facts: Reyes was the CEO of a Silicon Valley company, Brocade. Id. at *1. Reyes was charged with securities fraud, for backdating stock options that were given to company employees but not reported on the company’s books. Id. Reyes’s trial defense was that he relied, in good faith, on the Finance Department’s documentation when he signed-off on the backdated options; he argued that the Finance Department was well-aware of the practice. Id. at *2. The government countered at closing that Finance was unaware of the backdating, despite clear evidence in the government’s possession showing that Finance did in fact know (and SEC complaints had actually alleged as much).

Reyes was convicted after seven days of deliberation, id. at *7, and received a twenty-one month jail sentence and a $15 million fine. Id. at *2. He appealed.

Issue(s): “The issue that is dispositive of Reyes’ appeal concerns the government attorney’s misconduct in falsely telling the jury that the Finance Department did not know about the backdating, when the prosecutor knew that their statements revealed that they did.” Id. at *3.

Held: “We do not lightly tolerate a prosecutor asserting as a fact to the jury something known to be untrue or, at the very least, that the prosecution had a very strong reason to doubt. See Blueford, 312 F.3d at 968. There is no reason to tolerate such misconduct here.” Id. at *7.

[Ed. note: Ironically, Blueford is another infamous prosecutorial misconduct case involving a N.D. Cal. Assistant United States Attorney].

Of Note: There’s many big victories in Reyes, including a good holding on obstruction of justice. Id. at 11. The Ninth reverses the sentence of a co-defendant who was hit with an obstruction adjustment, when she earned a severance based on a “false” declaration from Reyes. Id. at *11. Unfair, held the Ninth, because there was no showing the defendant was responsible for the declaration, instead of defense counsel. Id.

In the ND Cal., nothing earns the judicial fish eye quite as much of late as a severance motion based on exculpatory co-defendant testimony. Reyes illustrates that if a severance declaration promises exculpatory testimony, the Court will be very much looking forward to that testimony in the severed trial. Id. at *11.

How to Use: Does anyone file prophylactic in limine motions flagging improper closing arguments for prosecutors? Granted, this is an insulting strategy – it sort of assumes the AUSA will act unethically. Sometimes, though, one wonders if it is necessary.

Last week, the extraordinarily high-profile Reyes case was reversed for improper closing argument (this Brocade case was a big news item in San Francisco, where the case was tried). The very next day, the Ninth issued another stern opinion on prosecutorial vouching. United States v. Harrison, No. 08-10391 (9th Cir. Aug. 19, 2009).

That same day, before the ink on these decisions had dried, improper argument in a federal San Francisco bank robbery trial sparked a blistering lecture from the bench and pushed the case to the brink of a mistrial. United States v. Johnson, CR-08-0251, MMC (N.D. Cal.). The Honorable Judge Chesney noted, with considerable displeasure, the irony of this problem arising the same week the Brocade decision was handed down -- and in the same federal district, to boot.

For Further Reading: The district judge in Reyes is the Honorable Charles R. Breyer. Another important decision arising from that court last week was United States v. Chaudry, C 03-40210 CRB (N.D. Cal. Aug. 17, 2009), Ord.

Chaudry is a very thoughtful decision on mental health issues and competency arising after trial, and before sentencing. Judge Breyer holds that an incompetent, convicted defendant cannot be held up to the maximum statutory term for the crime of conviction, and instead must be evaluated for “risk” and – potentially – released. The order will be published, and is worth a close read.

Steven Kalar, Senior Litigator N.D. Cal. FPD. Website at www.ndcalfpd.org


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