Monday, April 14, 2008

U.S. v. Sullivan, No. 06-50710 (4-11-08). This white collar case boils down to this: entertainment and retail companies paid the defendants to place and moniter ads in media outlets. The defendants billed the companies, kept the funds for 60+ days and then paid the outlets. The problem, and convictions, arose from the fact that the companies and media outlets never agreed to such a "float" and when times got bad, really bad, like bankruptcy bad, the defendants used the float to pay other bills (arguably private) rather than the companies. The defendants, and their bankruptcy lawyer (a little sheltering was alleged in numerous counts) were charged with every sort of white collar charge, including money laundering. The appeal focused on insufficiency of evidence, and primarily on the argument that there was no scheme, just desperate businessmen trying to borrow from Peter to pay Paul. The 9th, using the "in a light most favorable" standard affirmed the convictions, linking up the shennigans as a means to squirrel away funds, and the use of the float without approval. Severence was also not deemed prejudicial as the jury could compartmentalize.


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