Criminal Law

Crime: conduct that is prohibited and punished by a government 

• According to origin: can be common law or statutory crime 

• According to severity: can be felonies or misdemeanors 

• White-collar crime: crime that does not inflict or threaten physical harm 

Crimes are usually proved with 2 elements: 

1. State of mind ("scienter") 

   • You do not need to know you were committing a crime, you just need to have intended your conduct 

   • Brill v. Chevron Corporation, 804 Fed. Appx. 630 (N.D. Cal. 2020) -- predicate crime not proved where company had no knowledge that money paid to purchase crude oil was financing terrorism 

2. Bad act/omission ("actus reus") 

Responsibility for Crimes in the Corporate Context: 

• Corporations can be held responsible for acts/omissions of employees 

• Corporate officers/senior managers can be held responsible if they: 

  1. Authorized conduct 

  2. Failed to supervise conduct 

  3. Knew about conduct 

U.S. v. Park, 421 U.S. 658 (1975): corporate president was held responsible for corporation's violation of the Food, Drug, & Cosmetic Act where he failed to follow up on remediation efforts with respect to rodent infestation 

• After the dot-com failures and 2008 crisis, stiffer penalties were enacted for officers and directors 

• Possible penalties include: 

  • Jail 

  • Fines 

  • Banishment for humans 

  • Fines for companies 

Business Crimes 

• Conspiracy: the planning of a crime. Requires: 

  1. Agreement between multiple persons 

  2. To commit an unlawful act or to use unlawful means to obtain an otherwise lawful result 

• Money laundering: intentional participation in a financial transaction designed to hide the source of the funds (I.e. profits from criminal enterprise) 

• Bribery: act of giving something to someone in return for influencing their judgment in the giver's favor 

  • Foreign Corrupt Practices Act: antibribery statute that covers US companies' international operations 

• Embezzlement: act of stealing another person's property that has been entrusted to you 

  • I.e. as an employee 

RICO (Racketeer influenced and Corrupt Organizations Act): 

• Prohibits racketeering, an illegal activity designed to make a commercial profit that's disguised as a legal business 

• Prevents infiltration of illegal enterprises into legitimate businesses 

• Targets organized crime (I.e. Mafia) 

• Statute is worded so broadly that it has a far greater impact than originally contemplated 

REQUIRES: 

1. Defendant is involved 

2. In an enterprise 

3. Affects commerce 

4. Engaged in a pattern of racketeering activity w 2 predicate acts (broadly defined) 

• Ex: predatory lending schemes, bribing doctors to overprescribe 

SOX Act - Fraud and Obstruction of Justice: 

• Increased penalties for wrongful conduct related to certifying financial statements 

• Felony to alter/destroy/falsify financial docs with intent to obstruct or influence investigation 

Fourth Amendment: 

• Protects against unreasonable searches and seizures 

• In places where you have an expectation of privacy, gov needs a warrant issued on a probable cause to conduct a search (unless exceptions) 

--> EXCEPTIONS: 

• Emergencies 

• Plain view 

  • Dow Chemical Co. v. United States, 476 U.S. 1819 (1986) -- no expectation of privacy from low-flying planes 

• Permission given 

• Business defendants enjoy Fourth Amendment protections against unreasonable search and seizure 

  • They are able to assert attorney-client privilege over attorney-client communications 

  • Even a proper search cannot reach privileged documents 

Fifth Amendment: 

• Includes protection against self-incrimination 

  • Government may not compel a person to be a witness against himself 

• Corporations are not given protection against self-incrimination 

  • Corporations cannot prevent disclosure of its records on the basis of self-incrimination 

• Fifth Amendment also includes a right to due process, which in the criminal context includes: 

  • Arraignment (when charges are read and a plea entered) 

  • Preliminary hearing 

  • Discovery (exchange of info for use as evidence) 

  • Trial with cross-examination rights