Multiple Jeopardy

A case in point, with which I am quite familiar, arises out of the financial fraud at WorldCom. After federal prosecutors had brought charges against a number of the high-level accounting officials at WorldCom, two AGs brought state charges for the same offenses against the same individuals, including those who had pled guilty or were negotiating to plead guilty in federal court and had agreed to cooperate in the federal proceedings against higher officers of the company. At least one of the states (Oklahoma) had little or no apparent connection with the offense other than that some allegedly victimized shareholders reside there.

This meant that the guilty pleas and any non-immunized testimony in the federal case could and would be used against these defendants in the state proceedings. Without any agreement with the state prosecutors concerning their sentences, follow-on state charges exposed these individuals to substantial punishment and undermined any federal sentencing benefits that had been promised or were being negotiated in the federal case.

This double — or, more accurately, 52-fold — exposure can put a severe crimp in the ability of federal prosecutors to obtain cooperation and undermines the ability of actual or potential defendants and their counsel to negotiate and fulfill cooperation agreements with federal authorities. In the absence of agreements with state prosecutors about the impact on sentencing in the local proceedings, targets or defendants will obviously be less willing to cooperate with federal authorities, and federal authorities will have more difficulty proving their cases.

In the past, this matter has generally been handled as a matter of comity between federal and state prosecutors. Recognizing the greater investigative and prosecutorial resources of the federal government, the more than adequate sentences in the federal system, and the compelling federal interest in pursuing multi-istate financial crimes, state and local prosecutors have generally deferred to federal prosecutors to bring financial-fraud charges where the impact reaches across many state lines. However, in recent years, the widespread effects of certain financial crimes, the resulting public outcry, and the potential political benefits of donning the white knight outfit have proved too tempting for some state prosecutors to accede to the U.S. Department of Justice's requests for forbearance.

Under these circumstances, what is the potential federal cooperator and his or her counsel to do? Once efforts by federal prosecutors to jawbone state authorities have failed, defendants can expect to receive little assistance from the federal courts. A federal court may be willing, in appropriate circumstances, to stay state proceedings so as not to interfere with the ability of the prosecutors and defense to prepare for the federal trial. However, they are unlikely to enjoin or dismiss the state criminal proceedings because of the doctrine of non-interference with state criminal proceedings, Younger v. Harris, 401 U.S. 37 (1971), and the Supreme Court's dual sovereignty decisions. Bartkus v. Illinois, 359 U.S. 121 (1959); Abbate v. U.S., 359 U.S. 187 (1959).

Some History

In the late 1950s, before the wholesale application of the Bill of Rights to the states through the Fourteenth Amendment, the Supreme Court, in a series of cases, held that the Double Jeopardy Clause of the Fifth Amendment did not prevent a state from prosecuting an individual on identical charges. Conversely, the Court held that the federal government can prosecute an individual on the identical set of facts after conviction or acquittal in a state court. Despite opportunities, the Supreme Court has not backed away from the doctrine in more recent times.

As several well respected academics and at least one circuit judge have observed, in light of subsequent Constitutional developments and in light of the manifest unfairness to individuals, these decisions should no longer obtain or at least should be seriously reconsidered. “Significant developments both in substantive federal criminal law and in criminal law enforcement… indicate the entire dual sovereignty doctrine is in need of serious reconsideration.” U.S. v. All Assets of GPS Automotive Corp., 66 F.3d 483 (2d Cir. 1995) (Calebresi, J., writing for a unanimous panel, but in a separate concurrence speaking for himself). See Amar and Marcus: Double Jeopardy Law After Rodney King. 95 Columb. L. Rev. 1 (1995); Note, The Federalization of Criminal Law and Double Jeopardy. 31 Columb. Human Rights L. Rev. 175 (1999).

Since the federal Government may not prosecute an individual twice for the same offense, and since no state can do so, the combination of the two governments should not be able to do what neither could do alone. But until the Supreme Court precedents are overruled, federal courts cannot provide much relief for concurrent or subsequent state prosecutions. Federal courts have not been receptive to claims that federal criminal laws have preempted state laws on the same subject matter. See, eg, Hughes v. Crist, 377 F.3d 1258 (11th Cir. 2004).

Nevertheless, relief is available in many, but by no means all, state courts. Approximately half of the states have constitutional or statutory provisions that bar prosecutions in the state when the defendant has been convicted or acquitted on the identical matter “in another state, territory or country.” See Hagburg: Statutory Bars to Dual Sovereign Prosecutions. 72 N. Dak. L. Rev. 583 (1996). However, the state law provisions are not sufficient to protect potential federal cooperators for a variety of reasons.

State Law Provisions

First, the state prohibitions on multiple prosecutions are operative only in about half the states. Thus, if a state without such a provision seeks to prosecute for the same offense during or after a federal prosecution, the defendant can obtain no relief. Second, even in the states with these provisions, they only operate once there has been a final judgment of conviction or acquittal. Thus, a defendant can be pursued simultaneously in both the federal and state proceedings at least until there has been a final judgment. And, if the first case to go to final judgment is in state court, the defendant has no protection in federal court. Finally, and most astoundingly, some state courts interpret the language of the double jeopardy statute in a manner that excludes federal convictions.

For example, contrary to most state court interpretations, the Supreme Court of Mississippi has held that its double jeopardy statute does not apply to federal convictions. Evans v. State, 725 So. 2d, 613, 658 (Miss. 1998); contra, People v. Belcher, 11 Cal. 3d 91, 520 P.2d 385, (1974); People v. Lo Cicero, 14 N.Y. 2d 374, 200 N.E.2d 622 (1964). Thus, in Mississippi, if an individual has previously been convicted in Alabama or Albania, then he cannot be prosecuted for the same offense. But if the prior conviction is in federal court, then he can be prosecuted again. Leaving aside whether a federal court would find this interpretation to be a violation of the U.S. Constitution, it is clear that state laws are inadequate to protect a potential federal cooperator from multiple jeopardy.

In light of the infirmities of state laws and the paramount need of the federal government for cooperators to assist in securing indictments and convictions, the government should consider federal legislation to address the issue. Just as a federal prosecutor can obtain a court order to bestow immunity on a witness so that his testimony cannot be used against him in federal or state proceedings, so federal prosecutors should be able to go to federal court to prevent state prosecutors from interfering with the potential cooperation of a federal defendant. A federal statute, valid under the Supremacy Clause, could be drafted to provide that once an individual has been indicted for a federal crime, the prosecutor may obtain a court order barring state criminal charges against that individual on the same facts.

Such legislation should be given serious consideration by the Department of Justice if state or local prosecutors persist in the pursuit of criminal charges against potential cooperators who are already facing criminal charges for the same matters in the federal system. Alternatively, the same relief could be obtained if, as it should, the Supreme Court were to overrule the dual-sovereignty doctrine so that the Fifth Amendment's Double Jeopardy clause would protect an individual from being prosecuted for the same offense in both federal and state court.

A combination of factors has coalesced to spell trouble, or at least unwelcome complications, for federal prosecutors and aspiring cooperators and their counsel in the white-collar criminal arena. The factors include the political ambitions of state attorneys general (AGs), the broad overlap of state and federal financial-fraud crimes, the fully justified emphasis of federal prosecutors on pursuing nationwide financial-fraud offenses, and the persistence of the federal courts in refusing to limit the outmoded “dual sovereignty” doctrine that allows concurrent or consecutive federal and state prosecutions for the same offenses.

Many state AGs with their eyes on higher political office see the benefits that Elliott Spitzer and others have reaped from pursuing white-collar miscreants for state law violations arising out of multistate financial fraud. Some have piled on with state charges even after federal charges have been filed. This grab for the spotlight (or more accurately, the klieg lights) complicates the efforts of federal prosecutors to obtain cooperation and unfairly burdens and threatens defendants seeking to cooperate with federal authorities.

WorldCom: Case in Point

A case in point, with which I am quite familiar, arises out of the financial fraud at WorldCom. After federal prosecutors had brought charges against a number of the high-level accounting officials at WorldCom, two AGs brought state charges for the same offenses against the same individuals, including those who had pled guilty or were negotiating to plead guilty in federal court and had agreed to cooperate in the federal proceedings against higher officers of the company. At least one of the states (Oklahoma) had little or no apparent connection with the offense other than that some allegedly victimized shareholders reside there.

This meant that the guilty pleas and any non-immunized testimony in the federal case could and would be used against these defendants in the state proceedings. Without any agreement with the state prosecutors concerning their sentences, follow-on state charges exposed these individuals to substantial punishment and undermined any federal sentencing benefits that had been promised or were being negotiated in the federal case.

This double — or, more accurately, 52-fold — exposure can put a severe crimp in the ability of federal prosecutors to obtain cooperation and undermines the ability of actual or potential defendants and their counsel to negotiate and fulfill cooperation agreements with federal authorities. In the absence of agreements with state prosecutors about the impact on sentencing in the local proceedings, targets or defendants will obviously be less willing to cooperate with federal authorities, and federal authorities will have more difficulty proving their cases.

In the past, this matter has generally been handled as a matter of comity between federal and state prosecutors. Recognizing the greater investigative and prosecutorial resources of the federal government, the more than adequate sentences in the federal system, and the compelling federal interest in pursuing multi-istate financial crimes, state and local prosecutors have generally deferred to federal prosecutors to bring financial-fraud charges where the impact reaches across many state lines. However, in recent years, the widespread effects of certain financial crimes, the resulting public outcry, and the potential political benefits of donning the white knight outfit have proved too tempting for some state prosecutors to accede to the U.S. Department of Justice's requests for forbearance.

Under these circumstances, what is the potential federal cooperator and his or her counsel to do? Once efforts by federal prosecutors to jawbone state authorities have failed, defendants can expect to receive little assistance from the federal courts. A federal court may be willing, in appropriate circumstances, to stay state proceedings so as not to interfere with the ability of the prosecutors and defense to prepare for the federal trial. However, they are unlikely to enjoin or dismiss the state criminal proceedings because of the doctrine of non-interference with state criminal proceedings, Younger v. Harris , 401 U.S. 37 (1971), and the Supreme Court's dual sovereignty decisions. Bartkus v. Illinois , 359 U.S. 121 (1959); Abbate v. U.S. , 359 U.S. 187 (1959).

Some History

In the late 1950s, before the wholesale application of the Bill of Rights to the states through the Fourteenth Amendment, the Supreme Court, in a series of cases, held that the Double Jeopardy Clause of the Fifth Amendment did not prevent a state from prosecuting an individual on identical charges. Conversely, the Court held that the federal government can prosecute an individual on the identical set of facts after conviction or acquittal in a state court. Despite opportunities, the Supreme Court has not backed away from the doctrine in more recent times.

As several well respected academics and at least one circuit judge have observed, in light of subsequent Constitutional developments and in light of the manifest unfairness to individuals, these decisions should no longer obtain or at least should be seriously reconsidered. “Significant developments both in substantive federal criminal law and in criminal law enforcement… indicate the entire dual sovereignty doctrine is in need of serious reconsideration.” U.S. v. All Assets of GPS Automotive Corp. , 66 F.3d 483 (2d Cir. 1995) (Calebresi, J., writing for a unanimous panel, but in a separate concurrence speaking for himself). See Amar and Marcus: Double Jeopardy Law After Rodney King. 95 Columb. L. Rev. 1 (1995); Note, The Federalization of Criminal Law and Double Jeopardy. 31 Columb. Human Rights L. Rev. 175 (1999).

Since the federal Government may not prosecute an individual twice for the same offense, and since no state can do so, the combination of the two governments should not be able to do what neither could do alone. But until the Supreme Court precedents are overruled, federal courts cannot provide much relief for concurrent or subsequent state prosecutions. Federal courts have not been receptive to claims that federal criminal laws have preempted state laws on the same subject matter. See, eg, Hughes v. Crist , 377 F.3d 1258 (11th Cir. 2004).

Nevertheless, relief is available in many, but by no means all, state courts. Approximately half of the states have constitutional or statutory provisions that bar prosecutions in the state when the defendant has been convicted or acquitted on the identical matter “in another state, territory or country.” See Hagburg: Statutory Bars to Dual Sovereign Prosecutions. 72 N. Dak. L. Rev. 583 (1996). However, the state law provisions are not sufficient to protect potential federal cooperators for a variety of reasons.

State Law Provisions

First, the state prohibitions on multiple prosecutions are operative only in about half the states. Thus, if a state without such a provision seeks to prosecute for the same offense during or after a federal prosecution, the defendant can obtain no relief. Second, even in the states with these provisions, they only operate once there has been a final judgment of conviction or acquittal. Thus, a defendant can be pursued simultaneously in both the federal and state proceedings at least until there has been a final judgment. And, if the first case to go to final judgment is in state court, the defendant has no protection in federal court. Finally, and most astoundingly, some state courts interpret the language of the double jeopardy statute in a manner that excludes federal convictions.

For example, contrary to most state court interpretations, the Supreme Court of Mississippi has held that its double jeopardy statute does not apply to federal convictions. Evans v. State , 725 So. 2d, 613, 658 (Miss. 1998); contra, People v. Belcher , 11 Cal. 3d 91, 520 P.2d 385, (1974); People v. Lo Cicero , 14 N.Y. 2d 374, 200 N.E.2d 622 (1964). Thus, in Mississippi, if an individual has previously been convicted in Alabama or Albania, then he cannot be prosecuted for the same offense. But if the prior conviction is in federal court, then he can be prosecuted again. Leaving aside whether a federal court would find this interpretation to be a violation of the U.S. Constitution, it is clear that state laws are inadequate to protect a potential federal cooperator from multiple jeopardy.

In light of the infirmities of state laws and the paramount need of the federal government for cooperators to assist in securing indictments and convictions, the government should consider federal legislation to address the issue. Just as a federal prosecutor can obtain a court order to bestow immunity on a witness so that his testimony cannot be used against him in federal or state proceedings, so federal prosecutors should be able to go to federal court to prevent state prosecutors from interfering with the potential cooperation of a federal defendant. A federal statute, valid under the Supremacy Clause, could be drafted to provide that once an individual has been indicted for a federal crime, the prosecutor may obtain a court order barring state criminal charges against that individual on the same facts.

Such legislation should be given serious consideration by the Department of Justice if state or local prosecutors persist in the pursuit of criminal charges against potential cooperators who are already facing criminal charges for the same matters in the federal system. Alternatively, the same relief could be obtained if, as it should, the Supreme Court were to overrule the dual-sovereignty doctrine so that the Fifth Amendment's Double Jeopardy clause would protect an individual from being prosecuted for the same offense in both federal and state court.