On behalf of the National Association of Criminal Defense Lawyers, I attended the hearing before Judge Cooke today dealing with the motion to dismiss Count I of the indictment, the conspiracy to violate the "criminally derived property" statute, 18 U.S.C. section 1957. Here's a brief synopsis of what occurred (and yes, I am obviously biased as NACDL filed a brief in support of the motion to dismiss).
The issue on Count I is whether an attorney (Ben Kuehne) can be prosecuted under 1957 for receiving legal fees in light of 1957(f)(1)'s exception for "transaction[s] necessary to preserve a person's right to representation as guaranteed by the Sixth Amendment to the Constitution."
Judge Cooke started the hearing by asking the prosecutor to present his argument on the defense motion to dismiss because she wanted to know if he was really taking the position that 1957(f) was meaningless. The prosecutor answered YES! The prosecutor took the position that as a matter of law the motion should be denied because 1957(f) does not afford any protection to lawyers. He then argued that as a matter of fact, Kuehne's actions were not "necessary" to represent Ochoa and therefore not covered by the statute. And finally, he argued that if the judge disagreed with 1 & 2, she should at least present the question to a jury because 1956(f) is an affirmative defense.
John Nields then argued for Ben Kuehne. Nields argued that the statutory text is clear and that it must have meaning. He explained that the government could forfeit an attorney's fee if it was tainted, but it could not prosecute him under 1957. Judge Cooke asked what would happen if a defense lawyer participated in a drug transaction and then took a fee to represent the drug dealer. Nields argued that the defense lawyer could be prosecuted for lots of things under that hypo, but not 1957.
Judge Cooke questioned both the prosecution and the defense about the bright-line rule they were proposing. She tested the government theory that 1957(f) offers no protection vs. the defense's position that it affords an attorney absolute protection in a criminal case under 1957 for receiving a legal fee (it does not, for example, protect against forfeiture or a prosecution under a different statute).
Ultimately, the defense position is much more persuasive. Section 1957(f) cannot be meaningless as the prosecution suggests. The prosecution's reading of the statute is an assault on the Sixth Amendment, an assault on criminal defendants, and an assault on criminal defense lawyers. It seeks to chill lawyers from taking legal fees in criminal cases. The prosecution's arguments that (1) it will only prosecute the egregious cases and (2) if it doesn't, a jury will protect the defense bar, offers no comfort. Criminal defense lawyers will be chilled into refusing any fee for the fear of prosecution itself, even if they would likely be acquitted. Kuehne's reputation and standing in the community has suffered by the mere prosecution. He has had to raise money for the defense. He has been indicted in a serious federal case. Criminal defense lawyers shouldn't have to rely on the good graces of the government or a jury to make the right decision because Congress has spoken very clearly on this issue -- defense lawyers shall not be prosecuted for accepting a legal fee. Period.
Roy Black's firm did more in this case to vet the fee than any case in the history of the law -- it spent over $200,000 because it wanted to make sure that it was doing everything correctly. And Black hired the most ethical lawyer in the community to do the vetting, Ben Kuehne.
Count I should be dismissed.
There were lots of other motions being argued, but this is the one of most interest. I hope this post generates some discussion.
The SDFLA Blog is dedicated to providing news and notes regarding federal practice in the Southern District of Florida. The New Times calls the blog "the definitive source on South Florida's federal court system." All tips on court happenings are welcome and will remain anonymous. Please email David Markus at dmarkus@markuslaw.com
15 comments:
David, being serious for once, can you give us a brief synopsis of the other counts against Ben? What else is he charged with doing that is not covered by 1957(f)? Thanks.
Wire fraud and obstruction of justice. Here's the indictment: http://www.dailybusinessreview.com/images/news_photos/47035/indictment.PDF
If the prosecution is saying that the vetting process is not necessary under 1957f, how can they say that a lawyer should conduct an independent investigation to see that the fees are not tainted?
Is the the government's position that 1957f protects a criminal defense lawyer unless the defense lawyer is aware that his fee is tainted? Or simply, if that fee turns out to be tainted he is guilty under 1957? Both these positions are incorrect because 1957 gives a lawyer blanket protection to accept a fee from his client if he is the bona fide attorney.
The real issue is weather or not vetting a fee is necessary under 1957. The answer is no. Because if Roy Black has immunity from prosecution, vetting is not necessary. He takes the fee at his own peril of having it seized.
It's a jury question
Thanks for the status updates, David. As an aside: how was Nields in court?
The Fed's argument of:
"And finally, he argued that if the judge disagreed with 1 & 2, she should at least present the question to a jury because 1956(f) is an affirmative defense."
Could be what keeps the case alive. I just do not understand why they are going after him. My gut says they are hoping he cracks and puts Roy Black on a platter for them.
That last comment makes me wonder if there is more to this mess than meets the eye. I could not imagine Kuhne being actively involved in any of this. I can imagine a government prosecutor who is head hunting trying to go after a smaller fish in order to land a big one.
That must have been some fee Roy charged if he spent 200k just to make sure he should take it.
Ben won't crack and those Washington morons should have asked around before they did something so horrible as trying to wreck a man's life hoping he gives them someone else. Of course since that's the basic philosophy of the DOJ why should we be surprised. This legal community has rallied around Ben and hopefully we continue to do so right up to the victory party.
David- if count one is dismissed are the other counts dead in the water?
the sol has run on BLACK.
Great update, thanks.
"Scholars" and just obnoxious and subjective guessers -- you have missed the real 1957 point. Ben K's legal fee that he was paid by Roy B from the tainted funds is protected; not a ML offense, unless 1956 is the charge.
On the other hand, the offense the government alleges relates to Ben K taking the monies into his trust account to disperse to Roy B for his fees. That transaction came before the due diligence work and can be a 1957 offense with a lesser knowledge threshold than a 1956 charge.
Spend more time reading and reflecting on the case papers and in the library and less time drinking at parties to collect fees for Ben and trying to look cool.
PS - Roy B's fee is not forfeitable. It has likely already been spent. And, his bona fide reliance on Ben K negates any criminal charge.
2d PS - Any attorney doing vetting for another should have clause in agreement with the indicted defendant and client attorney that if funds are determined to be from SUA, they will be turned over to the government.
[My last word]
The comment indicating vetting is unnecessary is correct, if VI Amend. has attached to defendant/client. The statute does not address the taint, it makes the lawyer's fee payment not a prosecutable monetary transaction. In fact the vetting process in this case is precisely what caused the government's interest and Ben K's criminal predicament.
And, BTW, when undercover money winds up in an attorney's trust account and is then at best negligently vouched for after the fact, and disbursed to another attorney or elsewhere, the government would almost never overlook that, 1957(f), Washington boys, Ben K's notoriety, etc., notwithstanding. (But they should have taken a pass criminally and just asked Ben K to give up his own fee, and made a Bar referral if they had some issue of ethics).
Finally - to the blog host - did the court take judicial notice that Ben K is the "most ethical attorney in the community?" I doubt it, and while he is a fine fellow, your hyperbole is demonstrably untrue and actually harmful to his defense.
Hey Ed W, nice posts after six Scotches. You look way too old to be on computer.
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