United States v. Don Eugene Siegelman
2011 U.S. App. LEXIS 9503, 2011 WL 1753789, 640 F.3d 1159 (2011)
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Rule of Law:
A conviction for federal funds bribery or honest services fraud involving campaign contributions requires proof of an explicit quid pro quo, meaning an agreement to exchange a thing of value for a specific official act. This agreement does not need to be express and may be proven by circumstantial evidence, including the official's words and actions.
Facts:
- As Governor of Alabama, Don Siegelman created the Alabama Education Lottery Foundation to campaign for a state lottery initiative.
- After the lottery initiative failed, the Foundation incurred significant debt, which Siegelman personally and unconditionally guaranteed.
- Richard Scrushy, CEO of HealthSouth, desired an appointment to Alabama's Certificate of Need (CON) Review Board, a body that regulated healthcare facilities and was important to HealthSouth's business.
- Siegelman, through an intermediary, communicated to Scrushy that a contribution of at least $500,000 was needed to 'make it right' for Scrushy having supported Siegelman's opponent in the previous election.
- Scrushy arranged for two separate $250,000 donations to be made to the Foundation, structured indirectly through Integrated Health Services (IHS) and HealthSouth itself.
- One week after the first $250,000 donation was made via an IHS check, Siegelman appointed Scrushy to the CON Board.
- The funds from Scrushy's donations were used to pay down the Foundation's loan, thereby relieving Siegelman of his personal financial liability.
- In a separate matter, Siegelman and his aide, Nick Bailey, created a series of sham check transactions to disguise a $9,200 payment from businessman Lanny Young to Siegelman, making it appear to be a loan for a motorcycle purchase.
Procedural Posture:
- A federal grand jury in the Middle District of Alabama returned a second superseding indictment against Don Siegelman, Richard Scrushy, and others.
- The defendants were charged with federal funds bribery, honest services mail fraud, conspiracy, and, for Siegelman, obstruction of justice.
- Following a jury trial in the U.S. District Court, Siegelman and Scrushy were convicted on several counts, including bribery and honest services fraud, and were acquitted on others.
- Siegelman and Scrushy appealed their convictions to the U.S. Court of Appeals for the Eleventh Circuit, which initially affirmed most convictions.
- The U.S. Supreme Court granted certiorari, vacated the Eleventh Circuit's judgment, and remanded the case for further consideration in light of its decision in Skilling v. United States.
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Issue:
Does a jury instruction for federal funds bribery under 18 U.S.C. § 666, which requires a finding that an official and a defendant 'agree that the official will take specific action in exchange for the thing of value,' satisfy the 'explicit' quid pro quo requirement for bribery involving campaign contributions?
Opinions:
Majority - Per Curiam
Yes, an instruction requiring an 'agreement' for a 'specific action in exchange' for a thing of value is legally sufficient. The Supreme Court's requirement of an 'explicit' promise in quid pro quo bribery cases does not mean the promise must be 'express.' To require an express, overheard, or written agreement would allow defendants to escape liability through 'knowing winks and nods.' The jury instruction properly required the jury to find a quid pro quo—a specific agreement to exchange the donation for the official act—which can be inferred from the official’s words and actions. Therefore, the bribery convictions of Siegelman and Scrushy are affirmed. However, applying the Supreme Court's recent decision in Skilling, which limited honest services fraud to bribery and kickback schemes, the court reverses convictions on counts that relied on a broader theory of self-dealing, as there was insufficient evidence Siegelman participated in or that Scrushy committed a secondary bribery scheme. Siegelman's obstruction of justice conviction is affirmed, as a reasonable juror could infer from circumstantial evidence that he persuaded his aide to create the sham transactions to cover up the illicit payment.
Analysis:
This decision clarifies the evidentiary standard for quid pro quo bribery in the Eleventh Circuit, particularly in the context of campaign contributions. By distinguishing 'explicit' from 'express,' the court affirms that prosecutors can prove bribery through circumstantial evidence without needing a 'smoking gun' recording of a direct promise. This lowers the evidentiary bar for proving corrupt agreements, making it harder for public officials to evade liability by carefully avoiding explicit language. The case also demonstrates the immediate impact of the Supreme Court's decision in Skilling, leading to the reversal of honest services fraud convictions based on theories broader than bribery or kickbacks, thereby narrowing the scope of that statute.
