Arthur Andersen LLP v. United States
544 U.S. 696 (2005)
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Rule of Law:
To convict a defendant for “knowingly… corruptly persuading” another person to destroy documents under 18 U.S.C. § 1512(b), the government must prove the defendant was conscious of their wrongdoing and had a particular official proceeding in contemplation that they intended to obstruct.
Facts:
- As Enron Corporation's business practices came under scrutiny in 2001, Arthur Andersen LLP, Enron's auditor, was aware of significant accounting problems within the company.
- In August 2001, after Enron's CEO resigned, a senior Enron accountant, Sherron Watkins, warned Andersen's lead auditor, David Duncan, that Enron could 'implode in a wave of accounting scandals.'
- The Securities and Exchange Commission (SEC) opened an informal investigation into Enron in late August 2001.
- Beginning on October 10, 2001, Andersen executives, aware that an SEC investigation was 'highly probable,' began repeatedly instructing employees to comply with the firm’s document retention policy.
- On October 16, Enron announced a $1.01 billion charge to earnings, and the following day the SEC formally notified Enron of its investigation.
- Following these events, Andersen employees engaged in substantial destruction of paper and electronic documents related to the Enron engagement.
- On November 8, 2001, the SEC served Andersen with a subpoena for its Enron-related records.
- The next day, Duncan instructed his assistant to send an email stating, 'Per Dave— No more shredding... We have been officially served for our documents.'
Procedural Posture:
- Arthur Andersen LLP was indicted in the U.S. District Court for the Southern District of Texas for violating 18 U.S.C. § 1512(b).
- After a jury trial, the jury initially reported it was deadlocked.
- The District Court gave an 'Allen charge' to encourage further deliberation, after which the jury returned a guilty verdict.
- The District Court denied Andersen's motion for a judgment of acquittal.
- Andersen, as appellant, appealed the conviction to the U.S. Court of Appeals for the Fifth Circuit.
- The Court of Appeals affirmed the conviction, finding the jury instructions were proper.
- The U.S. Supreme Court granted certiorari to review the decision of the Fifth Circuit.
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Issue:
Do jury instructions for a conviction under 18 U.S.C. § 1512(b) for 'knowingly... corruptly persuading' another to destroy documents properly state the law if they fail to require proof that the defendant was conscious of wrongdoing and had a nexus to a particular official proceeding?
Opinions:
Majority - Chief Justice Rehnquist
No. The jury instructions were flawed because they failed to properly convey the required elements of the offense. A conviction under § 1512(b) requires proof that the defendant acted with a consciousness of wrongdoing and intended to obstruct a particular, foreseeable official proceeding. First, the term 'knowingly . . . corruptly persuades' requires that the persuader be conscious of their own wrongdoing. The trial court's instructions improperly allowed the jury to convict even if Andersen honestly believed its conduct was lawful. Second, the court's definition of 'corruptly' as intending to 'subvert, undermine, or impede' a proceeding was overly broad, as 'impede' can encompass innocent conduct, such as an attorney advising a client to withhold privileged documents. This interpretation stripped the word 'corruptly' of its essential limiting function. Finally, there must be a 'nexus' between the persuasion and a particular official proceeding; it is not enough that a defendant intends to affect some hypothetical future proceeding. Citing United States v. Aguilar, the Court held that the proceeding must be foreseen by the defendant, which the jury instructions failed to require.
Analysis:
This decision significantly narrowed the scope of the federal witness tampering statute, 18 U.S.C. § 1512(b), by heightening the 'mens rea' or criminal intent requirement for obstruction of justice. By requiring prosecutors to prove both a 'consciousness of wrongdoing' and a 'nexus' to a particular, foreseeable proceeding, the Court made it more difficult to convict individuals or corporations for destroying documents pursuant to a pre-existing policy. The ruling provides greater protection for businesses engaging in routine document management, as it distinguishes between destroying documents with a specific, corrupt intent to thwart a known investigation versus doing so under a general policy when an investigation is merely possible.
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