Federal Criminal Defense Blog : Georgia Federal Criminal Defense Lawyer & Attorney : Gillen Withers & Lake Law Firm : White Collar Crime, RICO, Trial : Atlanta, Savannah, GA

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On Friday, U.S. District Judge Amy St. Eve of the Northern District of Illinois re-sentenced Lord Conrad Black, former CEO of newspaper giant Hollinger International, Inc., to serve the remainder of his sentence, as reported in Canada's Globe and Mail. Black has served 29 months of his original 78 month sentence, imposed following his conviction on three of 12 counts in July of 2007. He has been on release from prison for nearly a year while his appeals of his convictions have been pending.

According to the article, Black has sued Richard Breeden, a special investigator for Hollinger and former Chairman of the U.S. Securities and Exchange Commission, and others for libeling him in a special report prepared for Hollinger. The Supreme Court of Canada is considering whether the dispute should be heard in Canada or the United States. 

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The U.S. Supreme Court yesterday denied the petition for certiorari by former international media mogul, Canadian citizen and British Lord, Conrad Moffat Black, as reported in the Washington Post.

Mr. Black was the CEO of Hollinger International, Inc., which owned newspapers worldwide. He was indicted (in an indictment made available by FindLaw which may be viewed here) with other officers and employees of Hollinger in the Northern District of Illinois in November of 2005 on 11 counts, in an original indictment which charged mail fraud conspiracy, wire fraud conspiracy and substantive counts of mail and wire fraud. The counts all referenced the "honest services" fraud statute, 18 United States Code section 1346. Testifying to the vigorousness of his defense, on July of 2007, a jury acquitted Mr. Black on 9 counts but convicted him on three others.

Mr. Black then challenged his convictions on appeal. In June of last year, the Supreme Court handed down its three "honest services" decisions, Skilling v. U.S., Black v. U.S., and Weyrauch v. U.S. In Skilling, the main decision involving former Enron President Jeffrey Skilling, the Court rejected the old "intangible right" to an employee's honest services theory and held that, in order to avoid being unconstitutionally vague, section 1346 applies to bribery or kickback schemes, and not to mere self-dealing by an employee. In Mr. Black's case, the Court unanimously held that the jury had not been properly instructed on honest services fraud at trial, and vacated his convictions and remanded. Then in October of last year, the Seventh Circuit Court of Appeals, in an opinion authored by distinguished Judge Richard Posner, struck two of the three remaining counts against Mr. Black, leaving him convicted on a single fraud count and a count for obstruction of justice. Mr. Black again appealed these two remaining convictions to the Seventh Circuit, which upheld them last December, and then to the Supreme Court, which has now declined to review them. Mr. Black is scheduled to be resentenced on June 24.

Source: McLean's.ca

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Canadian citizen Conrad Black, former head of Hollinger International, Inc., and once the third biggest newspaper magnate in the world, was charged in the Northern District of Illinois with diverting corporate funds for his own use and was convicted in July of 2007for "honest services" mail fraud, in violation of 18 U.S.C. s 1846, and obstruction of justice, following a jury trial. On June 24, 2010, the Supreme Court issued an opinion in Black v. U.S., case # 08-876, vacating Black's honest services convictions and remanding his case on the ground that the district court's instruction to the jury on honest services was incorrect. Black was incarcerated at the Federal Correctional Center in Coleman, Florida, and was released on bail two weeks ago after spending two years and four months in prison. He remains in the U.S. pending an appeal to return to Canada.

Lord Black's (he was made a member of the House of Lords of the United Kingdom by Queen Elizabeth II and Prime Minister Tony Blair) legal odyssey aside, he has become an observer and critic of the U.S. criminal justice system. Black has kept a diary, which may be viewed here, regarding his experience in prison. Most recently, on July 31, Black published a letter in Canada's National Post entitled "Conrad Black: My Prison Education." Black does pause to criticize his conviction in passing, citing the "fallibility of American justice." However, Black's letter provides a glimpse into life at the end of the tunnel of the federal criminal justice system. Black discusses his daily calls to his wife and his difficulties in getting updates on his application for bail in prison. He recounts the interest of his fellow inmates in the developments and media attention in his case, and rather poignantly describes the lengthy goodbyes from his friends:

"The Mafiosi, the Colombian drug dealers, (including a senator with whom I had a special greeting as a fellow member of a parliamentary upper house), the American drug dealers, high and low, black, white, and Hispanic; the alleged swindlers, hackers, pornographers, credit card fraudsters, bank robbers, and even an accomplished airplane thief; the rehabilitated and unregenerate, the innocent and the guilty, and in almost all cases the grossly over-sentenced, streamed in steadily for hours, to make their farewells."

"Most goodbyes were brief and jovial, some were emotional, and a few were quite heart-rending. Many of the 150 students that my very able fellow tutors and I had helped to graduate from high school, came by, some of them now enrolled in university by cyber-correspondence."

Black goes on to criticize harsh federal sentencing policies, especially for drug offenders, citing in particular the disparities in the crack cocaine sentencing Guidelines and their disproportionate impact on African-Americans. He also takes the public defender system to task for being subservient to the will of prosecutors, and laments the United Sates' massive prison population and prison industry in comparison with other Western democracies. Black concludes that "America’s 2.4 million prisoners, and millions more awaiting trial or on supervised release, are an ostracized, voiceless legion of the walking dead; they are no one’s constituency."

CTV.ca

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As noted by Ashby Jones at the Wall Street Journal Law Blog, the U.S. Supreme Court will hear oral arguments in the case of U.S. v. Skilling on Monday at 1 p.m., Eastern Time. The central issue to be argued to the Court is whether the federal honest services fraud statute, 18 United States Code 1346, is "unconstitutionally vague." Mr. Jones rounds up commentary from around the blogosphere on the case.

As noted by Mr. Jones, the honest services fraud statute, Section 846, criminalizes the deprivation of another of the "intangible right to honest services." Congress enacted Section 846 22 years ago following the Supreme Court's decision in McNally v. U.S, which had ended prosecution for honest services as a part of mail or wire fraud. The problem is that Section 846 does not define "honest services." The honest services provision is a favorite of prosecutors, especially in cases where deprivation of money or property, as required in traditional mail or wire fraud cases, may be difficult to establish.

Jeff Skilling is the former Chief Executive Officer of Enron Corporation, which crashed into sudden bankruptcy in 2001. Skilling, former CEO Kenneth Lay and others were charged with conspiracy, wire fraud, making false statements to auditors and insider trading. In May of 2006, Skilling was tried in the U.S. District Court for the Southern District of Texas and the jury found him guilty on 19 counts. The District Court sentenced him to 292 months imprisonment and ordered him to pay $45 million in restitution.

Skilling appealed to the U.S. Court of Appeals for the Fifth Circuit, arguing that the government used an invalid theory of "honest services" fraud to convict him. The indictment alleged that Skilling conspired with others to, among other things, deprive Enron and its shareholders of the right to the honest services owed by its employees. The Fifth Circuit affirmed Skilling's honest services fraud conviction, noting that it had created an exception to the honest services fraud statute in the related Enron case of U.S. v. Brown, 459 F.3d 509 (5th Cir.2006) where an employer creates a goal, aligns employees' interests to achieve the goal and higher-level management sanction improper conduct to reach the goal. However, the Fifth Circuit held that Skilling's conduct had not been sanctioned by the corporation.

Skilling has appealed to the Supreme Court, arguing that lower rulings on the honest services fraud statute have been “a hodgepodge of oft-conflicting holdings, statements, and dicta” that “only the most discriminating lawyer or judge” could understand. Attorney Sri Srinivasan of O’Melveny & Myers will argue on Skilling's behalf before the Court.

Another case calling into question the constitutionality of Section 1346 is the case of newspaper magnate Conrad Black. The Court heard oral arguments in Black's case last December.

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