It’s great when lawyers mix humor into tight legal analysis. Therefore, I’ve taken the liberty of posting below an article that otherwise is caught behind a paywall that guards the November 20, 2014 issue of the Chicago Daily Law Bulletin.
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Top court reels in Sarbanes-Oxley fish case
By Brian J. Murray
Brian J. Murray is a partner at Jones, Day, where he leads the Chicago office’s issues and appeals practice. He also teaches complex litigation at The University of Chicago Law School. He can be reached at bjmurray@jonesday.com.On Nov. 5, the U.S. Supreme Court heard arguments in Yates v. U.S., which asks the court to decide a momentous legal question of our times — whether a fish called a red grouper is a “tangible object” under an obstruction statute passed as part of the Sarbanes-Oxley Act in the wake of the Enron scandal in 2002.What does a red grouper have to do with Sarbanes-Oxley, you ask? Though it sounds fishy, the answer lies in the lower courts’ broad interpretation of the particular statute at issue.The facts of the case, as set out by the 11th U.S. Circuit Court of Appeals, are straightforward. John L. Yates was the captain of the Miss Katie, a fishing vessel operating off the coast of Florida. On Aug. 23, 2007, Officer John Jones, a federally deputized Florida Fish and Wildlife Conservation Commission officer, boarded Yates’ boat and noticed red grouper that appeared to be less than the 20-inch minimum.Jones measured the fish and placed those that were clearly under the legal size limit into wooden crates. He issued Yates a civil citation for catching undersized red grouper in federal waters and instructed him not to disturb the undersized fish, which would be seized by federal officials when the Miss Katie returned to port.Though Jones told Yates to bring the undersized fish to the dock, Yates instead instructed his crew to throw them overboard.At trial, Yates was found guilty of knowingly disposing of undersized fish to prevent the government from taking lawful custody and control of them, in violation of 18 U.S.C. Section 2232(a), and destroying or concealing a “tangible object with the intent to impede, obstruct or influence” a federal investigation, in violation of 18 U.S.C. Section 1519. He was sentenced to, and served, 30 days in jail.Only the second count is at issue before the Supreme Court, where the parties disagree whether a fish should be considered a “tangible object” for purposes of 18 U.S.C. Section 1519.The entire statute states: “Whoever knowingly alters, destroys, mutilates, conceals, covers up, falsifies or makes a false entry in any record, document or tangible object with the intent to impede, obstruct or influence the investigation or proper administration of any matter within the jurisdiction of any department or agency of the United States or any case filed under Title 11, or in relation to or contemplation of any such matter or case, shall be fined under this title, imprisoned not more than 20 years, or both.”The 11th Circuit held that under the plain language of the statute, a fish qualifies as a tangible object, since the Black’s Law Dictionary definition of “tangible” is “[h]aving or possessing physical form.” Thus, the court refused to consider any contrary statutory purpose and declined to apply the rule of lenity.The key to the outcome of this case will be the method of statutory interpretation that the Supreme Court uses. Yates argues that “tangible object” should be read in light of its surrounding terms, “record” and “document” to mean “a thing used to preserve information, such as a computer, server or similar storage device.”In addition, Yates argues that Congress’ purpose in enacting Sarbanes-Oxley, to prevent any “systematic campaign” like that taken by “Enron and its auditor, Arthur Andersen, to purge records and documents in anticipation of a federal investigation” informs the meaning of “tangible object” to exclude fish.
The government, on the other hand, argues that “tangible object” is unambiguous and should be interpreted based on its plain meaning. The government also claims that this Sarbanes-Oxley provision was an attempt by Congress to “close loopholes in the existing destruction-of-evidence regime,” and its clear language reflects that purpose — to “prohibit the destruction of all physical evidence.”
While the government argues that Yates’ “illogical” reading “prohibits a murderer from destroying his victim’s diary, but not the murder weapon,” the National Association of Criminal Defense Lawyers and the American Fuel & Petrochemical Manufacturers, who filed a friend-of-the-court brief in support of Yates, argue that his conviction under a broad reading of what they call an “anti-shredding provision,” is “but one more example of the overcriminalization epidemic.”
This epidemic, they argue, is a result of imprecisely drafted legislation resulting in individuals being subject to “penalties far in excess of those penalties set by Congress for the underlying crime.”
Thus, Yates, like last term’s Bond v. U.S. (see my column “Vengeance, poison and the treaty power — all in one high court case,” July 3), poses an interesting statutory construction question about whether the plain meaning of statutory language should control when such an interpretation poses constitutional and other policy concerns.
Those interested in issues of statutory construction must wait with … eh … bated breath to see which school of statutory interpretation wins out in Yates — a broad construction, or one motivated by a search for the true porpoise.
Sincere thanks to Jones, Day associate Meghan E. Sweeney for her contributions to this column.