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Yates v. United States – Context is Everything…

| Mar 22, 2015 | Federal Criminal Law |

This blog entry is intended to highlight a part of the law that usually confuses people – words. Please read it as a cautionary tale, keeping in mind that sometimes it takes the Supreme Court of the United States to determine the meaning of a statute in a criminal law case.

The definition of a “tangible object” seems fairly straight forward. The Supreme Court even goes out of its way to explain: “The ordinary meaning of an ‘object’ that is ‘tangible,’ as stated in dictionary definitions, is ‘a discrete . . . thing,’ Webster’s Third New International Dictionary 1555 (2002), that ‘possess[es] physical form,’ Black’s Law Dictionary 1683 (10th ed. 2014).” However, fish do not fall under that definition, at least when the High Court interprets the phrase’s meaning under Section 1519 of the Sarbanes-Oxley Act. Yates cites the famous judicial philosopher, Learned Hand, in Commissioner v. National Carbide Corp., 167 F.2d 304, 306 (2d Cir. 1948), acknowledging the nature of semantics, which states “words are chameleons, which reflect the color of their environment.”

The Case

In the case Yates v. United States, a divided United States Supreme Court interpreted Section 1519 of the Sarbanes-Oxley Act – a law that was prompted by the exposure of Enron’s accounting fraud, including activity that lead to the destruction of potentially incriminating documents.

Yates is a Florida commercial fisherman who was caught with 72 grouper on his boat that were measured to be under the legal size limit. After being cited for possession of undersized fish by a federal law enforcement agent, the captain instructed his crew to throw the undersized fish overboard, against the orders of the agent, and replaced the fish with larger ones. Yates was charged with “destroying, concealing, and covering up undersized fish”, thereby interfering with a federal investigation, violating 18 U.S.C. Section 1519. The punishment for violating this section includes fines or imprisonment up to 20 years.

The argument offered by Yates claimed that fish do not fall within the meaning of “tangible object” under the statute. At trial, Yates asked for a judgment of acquittal on the Section 1519 charge citing the statute’s origin as a law engineered to protect investors and the financial market in the wake of the Enron Scandal. The District Court denied his motion, and a jury found that he violated Section 1519. The 11th Circuit Court of Appeals upheld the conviction citing their own precedent. The Supreme Court granted certiorari and reversed the 11th Circuit’s judgment.

Justice Ginsburg’s opinion acknowledged that “a fish is no doubt an object that is tangible” and they can be “seen, caught, and handled, and a catch, as this case illustrates, is vulnerable to destruction.” Ginsburg ultimately agreed with Yates’ interpretation in lieu of the government’s and held that “in Sarbanes-Oxley, Congress trained its attention on corporate and accounting deception and cover-ups” and therefore, “a tangible object captured by Section 1519… must be one used to record or preserve information.” The Justice’s reasoning included employing interpretive guides such as reading the heading of the Section 1519, as well as the title – leading to the conclusion that “Congress did not intend ‘tangible object’ in Section 1519 to sweep within its reach physical objects of every kind, including things no one would describe as records, documents, or devices closely associated with them.” In an attempt to seal the fate of the meaning of what a “tangible object” is with respect to Section 1519, the Court invoked the rule “ambiguity concerning the ambit of criminal statutes should be resolved in favor of lenity” citing Cleveland v. United States, 531 U.S. 12, 25 (2000) (quoting Rewis v. United States, 401 U.S. 808, 812 (1971)).

If you find yourself in a situation where the government has pressed charges against you, do not wait for help. Contact George Hildebrandt, an experienced Criminal Defense Attorney with over 30 years of experience.

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