Friday, June 25, 2010

Joe Bruno, Jeffrey Skilling and "Honest Services"

There's been a lot of talk in the local news about Joe Bruno and the recent Supreme Court decision - Skilling v. United States, 561 US ____.

Bruno was convicted under the "honest services" law, 18 USC § 1346. So was Jeffrey Skilling, of Enron fame. Skilling's conviction under this statute was overturned by the Supreme Court, and many are wondering if Bruno's conviction will also be overturned.

Skilling sought to have the entire statute declared unconstitutional. The Court did not go that far. The critical language of the decision for Bruno is the following from page 49 of the slip opinion:

The Government did not, at any time, allege that Skilling solicited or accepted side payments from a third party in exchange for making these misrepresentations.

In Skilling's case (as I read it), while he did do something wrong (misrepresent Enron's financial condition) he did not accept payments from a third party.

With Bruno, by contrast, it seems clear that he accepted side payments from one or more third parties, totaling about $280,000. The Times Union put it this way:

It was his dealings with Abbruzzese, who benefited from Bruno's legislative power, that were central in the two felony counts on which Bruno was convicted.

If that's accurate then Bruno did receive side payments and a third party benefited from Bruno's actions as a legislator. The Supreme Court decision will not help Bruno. He's still going to prison.

As an aside, my favorite quote from the Times Union article is this one:
The judge called the testimony of Bruno's former Senate lawyers "eye-popping" and said he was "disgusted" they had advised state senators to hand-deliver their annual ethics disclosure forms to avoid federal mail fraud charges. Sharpe also reminded Bruno that those lawyers worked for the state of New York and its citizens, not Bruno.

Lawyers working for us advised legislators to avoid mail fraud charges by hand-delivering their ethics disclosure forms. Ugh.
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