Advice and complicity

Duke Law Journal

Volumn 60, Issue 2, 2010, Pages 499-535

  Smith, Matthew A ^a  

^a DUKE UNIVERSITY   (United States)

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EID: 78649355923     PISSN: 00127086     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Article

References (281)

1. Sanford H. Kadish, Complicity, Cause, and Blame: A Study in the Interpretation of Doctrine, 73 CALIF. L. REV. 323, 336 (1985).
2. ("Two kinds of actions render the secondary party liable for the criminal actions of the primary party: intentionally influencing the decision of the primary party to commit a crime, and intentionally helping the primary actor commit the crime....")
3. ("[The accomplice] must act with the intention of influencing or assisting the primary actor to engage in the conduct constituting the crime.")
4. see also WAYNE R. LAFAVE & AUSTIN W. SCOTT, JR., CRIMINAL LAW 576 (2d ed. 1986).
5. ("[Accomplice liability consists of giving] assistance...with the intent thereby to promote or facilitate commission of the crime.")
6. ("By its nature, the doctrine of complicity, like causation, requires a result. It is not a doctrine of inchoate liability.")
7. ("[The accomplice's] liability is derivative, which is to say, it is incurred by virtue of a violation of law by the primary party to which the secondary party contributed.")
8. "Mistake of law" refers to a defendant's erroneous belief that the conduct for which the defendant is being prosecuted is not criminal
9. (Outlining the doctrine of mistake of law). A mistake of law is not a defense to most crimes. Id.
10. ("[T]o be liable as an accomplice in the crime committed by the principal, the secondary party must act with the mens rea required by the definition of the principal's crime.")
11. ("Generally, it may be said that accomplice liability exists when...[the accomplice's] purpose is to encourage or assist another in the commission of a crime as to which the accomplice has the requisite mental state.")
12. See 1 GEOFFREY C. HAZARD, JR. & W. WILLIAM HODES, THE LAW OF LAWYERING § 22.2 (3d ed. 2009).
13. ("[L]awyers contribute to the peaceful running of a lawful society by advising their clients what the law is, and by carrying out their client's wishes within the bounds of law.")
14. See MODEL RULES OF PROF'L CONDUCT R. 1.2(d) (2009).
15. ("A lawyer shall not counsel a client to engage, or assist a client, in conduct that the lawyer knows is criminal or fraudulent....")
16. ("Rule 1.2 seeks to assure that lawyers not become accomplices in criminal or fraudulent conduct.") According to the ABA, the Model Rules of Professional Conduct have been adopted in some form by all but one state.
17. See Am. Bar Ass'n, Model Rules of Professional Conduct Dates of Adoption, American Bar Association, http://www.abanet.org/cpr/mrpc/alpha_states.html (last visited Oct. 13, 2010).
18. See Model Rules of Prof'l Conduct R. 1.2(d) ("[A] lawyer. .. may counsel or assist a client to make a good faith effort to determine the validity, scope, meaning or application of the law.")
19. ("A lawyer may refuse to comply with an obligation imposed by law upon a good faith belief that no valid obligation exists.")
20. ("[I]f it was the purpose of the one giving the advice to influence the other to commit the crime, he is an accomplice. .. .")
21. (Describing the mens rea of accomplice liability)
22. (Noting that mistake of law is "ordinarily not a recognized defense")
23. See Model Rules of Prof'l Conduct R. 1.2(d) (permitting lawyers to assist clients in a good-faith effort to determine the "scope, meaning or application" of the law).
24. ("A lawyer may refuse to comply with an obligation imposed by law upon a good faith belief that no valid obligation exists.")
25. See Annotated Model Rules of Prof'l Conduct R. 1.2(d) annot. (6th ed. 2007) (citing lawyer discipline cases involving violations of court orders and other clearly illegal offenses).
26. See Peter J. Henning, Targeting Legal Advice, 54 AM. U. L. REV. 669, 688 (2005).
27. (discussing legal advisors' susceptibility to allegations of fraud)
28. See generally Geoffrey C. Hazard, Jr., How Far May a Lawyer Go in Assisting a Client in Legally Wrongful Conduct?, 35 U. MIAMI L. REV. 669 (1981).
29. (Discussing the scope of attorneys' liability for client fraud)
30. Securities Act of 1933, 15 U.S.C. §§ 77a-77aa (2006).
31. (Providing criminal penalties for "[a]ny person who willfully violates any of the provisions of this subchapter")
32. Securities Exchange Act of 1934, 15 U.S.C. §§ 78a-78oo (2006 & Supp. III 2009).
33. (Providing criminal penalties for "any person who willfully and knowingly" misrepresents a material fact in an Exchange Act statement)
34. LOUIS LOSS & JOEL SELIGMAN, FUNDAMENTALS OF SECURITIES REGULATION 1347 (4th ed. 2001).
35. ("All of the SEC statutes make it a criminal offense 'willfully' to violate any of their provisions, any related rule, or (with respect to the last four acts in the series) any related order.") In SEC v. National Student Marketing Corp., 457 F. Supp. 682 (D.D.C. 1978), the court upheld aiding-and-abetting liability for lawyers advising on securities transactions, holding counsel liable for ignoring the materiality of information that was omitted from a shareholder proxy statement and for subsequently failing to interfere with a related merger. See id. at 713 ("The record amply demonstrates the 'knowledge of the fraud, and not merely the undisclosed material facts' that is required to meet this element of secondary liability." (quoting Hirsch v. du Pont, 553 F.2d 750, 759 (2d Cir. 1977))). The Private Securities Litigation Reform Act of 1995 (PSLRA), Pub. L. No. 104-67, 109 Stat. 737 (codified as amended in scattered sections of 15 and 18 U.S.C.), instructed the Securities and Exchange Commission (SEC) to prosecute violations of the Exchange Act, codifying a broad range of criminal prohibitions that apply to counsel advising on a securities transaction. See 15 U.S.C. § 78t(e) (providing for prosecution of persons who "knowingly provide substantial assistance" to violators of the securities laws); Stoneridge Inv. Partners v. Scientific-Atlanta, Inc., 128 S. Ct. 761, 769 (2008) (recognizing that "Congress. .. directed prosecution of aiders and abettors by the SEC" in § 78t(e)). The precedent established in Stoneridge continues to haunt lawyers advising on disclosure-related matters involving securities. See SEC v. Bank of Am. Corp., 653 F. Supp. 2d 507, 509 (S.D.N.Y. 2009) (questioning why the SEC did not seek penalties from lawyers who prepared disclosure statements omitting allegedly material information in a merger transaction). Courts have interpreted the relevant section of the PSLRA as requiring that an aider and abettor have actual knowledge of a violation of the Exchange Act rather than allowing liability for recklessness by secondary actors. See, e.g., SEC v. Pasternak, 561 F. Supp. 2d 459, 501 (D.N.J. 2008) (requiring actual knowledge of a securities-law violation, as opposed to reckless action, and citing cases that imposed the same requirement).
36. See United States v. Wolfson, 405 F.2d 779, 781-82 (2d Cir. 1968) (rejecting appellants' argument that they could not be convicted of violating the Securities Exchange Act because they were not aware of its registration requirements).
37. United States v. Benjamin, 328 F.2d 854 (2d Cir. 1964).
38. Cf. Manning Gilbert Warren III, The Primary Liability of Securities Lawyers, 50 SMU L. REV. 383, 398 (1996).
39. (Invoking Benjamin as a "behavior-shaping judicial statement[]")
40. (Noting that the SEC frequently quotes from Benjamin in enforcement actions)
41. Marc I. Steinberg, Attorney Liability for Client Fraud, 1991 COLUM. BUS. L. REV. 1, 1.
42. (Quoting Judge Friendly's opinion in Benjamin)
43. Benjamin, 328 F.2d at 856.
44. 15 U.S.C. § 77c(a)(1) (1964).
45. Benjamin, 328 F.2d at 857.
46. ("[Benjamin] must have known that control of the corporation... was being acquired by Mende and that the statute explicitly denied exemption to any new offerings by persons in control, a limitation of which his testimony before the SEC showed he was well aware.")
47. United States v. Cavin, 39 F.3d 1299 (5th Cir. 1994).
48. ("Ridgeway's efforts were assisted professionally by Daigle, an associate soon to become a partner at a prestigious New Orleans law firm.")
49. ("To replace the $1 million...Ridgeway entered into a stock rental transaction....[Ridgeway] reported [the stock] to the Commissioner as an unencumbered asset.")
50. (Describing Daigle's involvement in a sham stock-rental transaction and securities purchase)
51. ("Daigle maintains that the status of these so-called 'rental assets' was unclear at the time and therefore he lacked fraudulent intent....")
52. See MODEL RULES OF PROF'L CONDUCT R. 2.1 (2009).
53. ("In advising a client, a lawyer shall exercise independent professional judgment and render candid advice.").
54. (Noting that Rule 2.1 prohibits the lawyer from "play[ing] sycophant" to a client seeking to "have her own preconceptions confirmed rather than seek genuine advice").
55. see also DEBORAH L. RHODE, IN THE INTERESTS OF JUSTICE: REFORMING THE LEGAL PROFESSION 53-58 (2000).
56. (Presenting and critiquing the traditional justifications for the adversary system)
57. CHARLES W. WOLFRAM, MODERN LEGAL ETHICS 564 (1986).
58. (summarizing the features of the adversary system)
59. See Lon L. Fuller & John D. Randall, Professional Responsibility: Report of the Joint Conference, 44 A.B.A. J. 1159, 1161 (1958).
60. ("Partisan advocacy plays its essential part in [litigation], and the lawyer pleading his client's case may properly present it in the most favorable light. A similar resolution of doubts in one direction becomes inappropriate when the lawyer acts as counselor.")
61. See MODEL RULES OF PROF'L CONDUCT R. 1.4(b).
62. ("A lawyer shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation.")
63. ("[Under Rule 1.4(b),] a lawyer must arm clients with the information necessary for making important decisions about the representation....")
64. ("A lawyer's duty to exercise independent professional judgment may be threatened not only by 'others' but by clients as well; a client may consult a lawyer to have her own preconceptions confirmed rather than to seek genuine advice.")
65. See generally THE TORTURE PAPERS 3-360 (Karen J. Greenberg & Joshua L. Dreitel eds., 2005) (containing memoranda composed by OLC attorneys).
66. See S. COMM. ON ARMED SERVS., 110TH CONG., INQUIRY INTO THE TREATMENT OF DETAINEES IN U.S. CUSTODY, at xv-xvi (Comm. Print 2008) (describing the drafting of the memos).
67. See JACK GOLDSMITH, THE TERROR PRESIDENCY: LAW AND JUDGMENT INSIDE THE BUSH ADMINISTRATION 22-23 (2007)
68. (introducing Yoo as an "OLC deputy with authority to issue legal opinions that were binding throughout the executive branch")
69. Memorandum from Jay S. Bybee, Assistant Att'y Gen., OLC, U.S. Dep't of Justice, to Alberto R. Gonzales, Counsel to the President, and William J. Haynes, II, Gen. Counsel, U.S.
70. Dep't of Def., Application of Treaties and Laws to al Qaeda and Taliban Detainees 9-10 (Jan. 22, 2002) (on file with the Duke Law Journal).
71. Memorandum from Jay S. Bybee, Assistant Att'y Gen., OLC, U.S. Dep't of Justice, to Alberto R. Gonzales, Counsel to the President, Standards of Conduct for Interrogation under 18 U.S.C. §§ 2340-2340A, at 14-22 (Aug. 1, 2002) (on file with the Duke Law Journal).
72. Memorandum from John C. Yoo, Deputy Assistant Att'y Gen., OLC, U.S. Dep't of Justice, to William J. Haynes, II, Gen. Counsel, U.S. Dep't of Def., Military Interrogation of Alien Unlawful Combatants Held Outside the United States 2-10 (Mar. 14, 2003) (on file with the Duke Law Journal).
73. ("[T]he decision to replace well established military doctrine, i.e., legal compliance with the Geneva Conventions, with a policy subject to interpretation, impacted the treatment of detainees in U.S. custody.")
74. (Describing Lt. Gen. Ricardo Sanchez's issuance and withdrawal of several official policies governing the treatment of detainees in Iraq).
75. 18 U.S.C. §§ 2340-2340B (2006).
76. Memorandum from Jay S. Bybee, Assistant Att'y Gen., OLC, U.S. Dep't of Justice, to Alberto R. Gonzales, Counsel to the President, Standards of Conduct for Interrogation under 18 U.S.C. §§ 2340-2340A, in THE TORTURE PAPERS, supra note 41, at 176.
77. See Kathleen Clark, Ethical Issues Raised by the OLC Torture Memorandum, 1 J. NAT'L SECURITY L. & POL'Y 455, 462-63 (2005).
78. ("The legal analysis in the [August 2002] [m]emorandum was so indefensible that it could not-and did not-withstand public scrutiny.")
79. see also Mike Allen & Susan Schmidt, Memo on Interrogation Tactics Is Disavowed, WASH. POST, June 23, 2004, at A1 (reporting the withdrawal of the August 2002 memorandum).
80. David Ignatius, Op-Ed., Small Comfort, WASH. POST, June 15, 2004, at A23 (reporting the release of the torture memo on the Washington Post's website).
81. See, e.g., José E. Alvarez, Torturing the Law, 37 CASE W. RES. J. INT'L L. 175, 176-77 (2006).
82. ("When our high-level torturers act they do not do so by ignoring the law or acting extralegally but by systematic and reasoned misinterpretations of the law.")
83. Michael Hatfield, Fear, Legal Indeterminacy, and the American Lawyering Culture, 10 LEWIS & CLARK L. REV. 511, 515 (2006).
84. ("[T]he legal profession's response to [the August 2002 memo] has been an exceptionally deep and widespread expression of dismay.")
85. JEREMY WALDRON, Torture and Positive Law: Jurisprudence for the White House, 105 COLUM. L. REV. 1681, 1687 (2005).
86. ("Reading the memoranda of Judge Bybee and Professor Yoo. .. shook my faith in the integrity of the community of American jurists.")
87. (Criticizing the memo's conclusions under the laws of war); Waldron, supra note 61, at 1693-95 (same)
88. See MICHAEL P. SCHARF & PAUL R. WILLIAMS, SHAPING FOREIGN POLICY IN TIMES OF CRISIS 192-93 (2010).
89. (Relating former State Department Legal Adviser William Taft's reflection that the OLC memos arrived at "conclusions that were not consistent with our treaty obligations under the Convention against Torture and our obligations under customary international law")
90. ("[The August 2002 memorandum interpreting the torture statute] distorted the meaning and intent of anti-torture laws, rationalized the abuse of detainees in U.S. custody[,] and influenced Department of Defense determinations as to what interrogation techniques were legal for use during interrogations conducted by U.S. military personnel.")
91. (Analyzing the flaws of the August 2002 memorandum construing the torture statute)
92. ("[T]hese memoranda are advocacy briefs by 'can do' lawyers but certainly not objective examinations of the current treaty obligations of the United States.")
93. ("[T]he [August 2002] Memorandum presents highly questionable claims as settled law. It does not present either the counter arguments to these claims or an assessment of the risk that other legal actors-including courts-would reject them.")
94. NEIL M. PERETZ, The Limits of Outsourcing: Ethical Responsibilities of Federal Government Attorneys Advising Executive Branch Officials, 6 CONN. PUB. INT. L.J. 23, 49-50 (2006).
95. ("The government attorneys preparing the memos may have failed to meet their ethical responsibility. .. to explore alternative perspectives and to ensure such perspectives were represented during the policymaking process.")
96. see also Adam Liptak, Legal Scholars Criticize Memos on Torture, N.Y. TIMES, June 25, 2004, at A14 (surveying criticisms by prominent legal scholars).
97. ("Legal advisors to policymakers should not zealously advocate because it is unlikely that an equally zealous adversary will arise to oppose them....[T]here is often no adversary to counterbalance the government attorney's advocacy....")
98. See generally WALTER E. DELLINGER, DAWN JOHNSEN, RANDOLPH MOSS, CHRISTOPHER SCHROEDER, JOSEPH R. GUERRA, BETH NOLAN, TODD PETERSON, CORNELIA. T.L. PILLARD, H. JEFFERSON POWELL, TERESA WYNN ROSEBOROUGH, RICHARD SHIFFRIN, WILLIAM MICHAEL TREANOR, DAVID BARRON, STUART BENJAMIN, LISA BROWN, PAMELA HARRIS, NEIL KINKOPF, MARTIN LEDERMAN & MICHAEL SMALL, PRINCIPLES TO GUIDE THE OFFICE OF LEGAL COUNSEL 2 (2004), available at http://www.acslaw.org/files/2004programs_OLCprinciples_whitepaper.pdf ("OLC's analysis should disclose, and candidly and fairly address, the relevant range of legal sources and substantial arguments on all sides of the question.")
99. See Jesselyn Radack, Tortured Legal Ethics: The Role of the Government Advisor in the War on Terrorism, 77 U. COLO. L. REV. 1, 19-30 (2006).
100. (Propounding a "morally perilous question" doctrine guided by the Eighth Amendment that triggers heightened duties for lawyers advising the government)
101. (Discussing the role of the author's moral views in determining the content of the reasoning in the August 2002 memo)
102. (Describing Rule 2.1 of the Model Rules of Professional Conduct as contemplating "a moral dialog between autonomous individuals").
103. (Reporting criticism by Cass Sunstein that the reasoning in the August 2002 memo was "just short of reckless")
104. (Relating criticism of the August 2002 memorandum that "[i]t reads like a bad defense counsel's brief, not an OLC opinion")
105. ("[The memo's] assertions about the state of the law are so inaccurate that they seem to be arguments about what the authors (or the intended recipients) wanted the law to be rather than assessments of what the law actually is.")
106. (Reporting criticism of a former Third Circuit Court of Appeals judge that "[t]he position taken by the government lawyers in these legal memoranda amount[s] to counseling a client as to how to get away with violating the law" (second alteration in original))
107. Vanessa Blum, Culture of Yes: Signing Off on a Strategy, LEGAL TIMES, June 14, 2004, at 12
108. (Quoting former OLC attorney Bruce Fein identifying the "problem with" the OLC's legal advice as being "that you start out with a conclusion and then go put together the jigsaw puzzle that makes it legal instead of looking for the most persuasive answer under the law")
109. Stephen Gillers, Tortured Reasoning, AM. LAW., July 2004, at 65 ("As an advisor, a lawyer is not an advocate.")
110. Andrew Rosenthal, Editorial Observer, Legal Breach: The Government's Attorneys and Abu Ghraib, N.Y. TIMES, Dec. 30, 2004, at A22.
111. ("[A] more cynical approach [to the law] says that lawyers are simply an instrument of policy-get me a legal opinion that permits me to do X. Sometimes a lawyer has to say, 'You just can't do this.'" (quoting attorney Jeh Johnson)).
112. ("OLC should not simply provide an advocate's best defense of contemplated action that OLC actually believes is best viewed as unlawful.")
113. ("Partisan advocacy plays its essential part in [litigation], and the lawyer pleading his client's case may properly present it in the most favorable light. A similar resolution of doubts in one direction becomes inappropriate when the lawyer acts as counselor.")
114. ("[A] lawyer's counseling can serve as a mechanism of social control by performing the socially desirable function of encouraging law compliance on the part of clients.")
115. (Contrasting the responsibility of advisors to provide balanced legal analysis, or to caution their clients as to unbalanced aspects of their analysis, with the liberty of advocates to assert non-frivolous claims)
116. See, e.g., WILLIAM C. POWERS, JR., RAYMOND S. TROUBH & HERBERT S. WINOKUR, JR., REPORT OF INVESTIGATION BY THE SPECIAL INVESTIGATIVE COMMITTEE OF THE BOARD OF DIRECTORS OF ENRON CORP. 17 (2002).
117. (Attributing Enron's failure to disclose its hedging transactions with its affiliated entities in part to "an absence of...objective and critical professional advice by outside counsel at Vinson & Elkins").
118. Deborah L. Rhode & Paul D. Paton, Lawyers, Ethics, and Enron, 8 STAN. J.L. BUS. & FIN. 9, 19 (2002).
119. ("While questions about [Vinson & Elkins'] exposure to malpractice suits remain open, the facts available suggest that the firm was more than a bystander to corporate misconduct.")
120. See Superseding Indictment, United States v. Fastow, No. H-02-0665 (S.D. Tex. Apr. 30, 2003), 2003 WL 22331356 (charging Enron executives with 109 counts of fraud, conspiracy, obstruction of justice, and other crimes).
121. (Documenting Vinson & Elkins' involvement in transactions and disclosure that became the subject of the indictments against Enron executives)
122. See Robert W. Gordon, A New Role for Lawyers?: The Corporate Counselor After Enron, 35 CONN. L. REV. 1185, 1207-15 (2003)
123. (Proposing a new conception of the corporate advisor's role in response to the Enron scandal)
124. see also DEBORAH L. RHODE & DAVID LUBAN, LEGAL ETHICS 498-504 (4th ed. 2004) (discussing the flaws in traditional notions of the lawyer's counseling role).
125. The Sarbanes-Oxley Act of 2002, Pub. L. No. 107-204, 116 Stat. 745 (codified in scattered sections of 11, 15, 18, 28 and 29 U.S.C.), passed in response to the Enron scandal, imposed new requirements requiring lawyers to report "evidence of a material violation of securities laws or breach of fiduciary duty" to the chief legal counsel or board of directors. Id. § 307, 116 Stat. at 784.
126. (Describing the role of Enron lawyers and noting a lack of "appropriate standards of third-party liability for lawyers who passively acquiesce in client fraud" in the rules of professional conduct)
127. ("Management and the Board relied heavily on the perceived approval by Vinson & Elkins of the structure and disclosure of the transactions. Enron's Audit and Compliance Committee, as well as in-house counsel, looked to it for assurance that Enron's public disclosures were legally sufficient....Vinson & Elkins should have brought a stronger, more objective and more critical voice to the disclosure process.")
128. (Describing the pre-Sarbanes-Oxley "status quo" as one in which "lawyers effectively facilitate, or passively acquiesce in and enable corporate frauds, in the name of a noble idea of advocacy that has been ludicrously misapplied")
129. (Criticizing the use, as a defense of the Enron lawyers' conduct, of the notion of the corporate lawyer as "adversary-advocate")
130. See JERRY W. MARKHAM, A FINANCIAL HISTORY OF MODERN U.S. CORPORATE SCANDALS: FROM ENRON TO REFORM 99 (2006).
131. ("The list of complex Enron structured finance transactions is simply too long to examine in any depth.")
132. (Reporting findings on the "Chewco" transaction and the "LJM," "hedging," and "asset sale" transactions)
133. (Summarizing the structure and accounting implications of the Chewco transaction)
134. (Summarizing Enron's asset sale transactions)
135. (Summarizing issues raised by the hedging transactions)
136. (Describing abuses of accounting standards involved in the hedging transactions)
137. (Describing the financial consequences of Enron's restatement of earnings)
138. (Providing a factual basis for charges related to Enron executives' use of the fraudulent hedging transactions)
139. (Noting Vinson & Elkins' involvement in advising Enron on the Chewco, asset sale, and hedging transactions)
140. ("[Vinson & Elkins] also assisted Enron with the preparation of its disclosures of related-party transactions in the proxy statements and the footnotes to the financial statements in Enron's periodic SEC filings.")
141. (Discussing Watkins' objections and the decision to hire Vinson & Elkins). The decision to hire Vinson & Elkins and the firm's decision to take the job were made in spite of the fact that the firm would be reviewing its own work. Rhode & Paton, supra note 74, at 20 ("In agreeing to take on this investigation, Vinson & Elkins opened itself to accusations that it would be evaluating its own work.")
142. Destruction of Enron-Related Documents by Andersen Personnel: Hearing Before the Subcomm. on Oversight and Investigations of the H. Comm. on Energy and Commerce, 107th Cong. 46-54 (2002) (letter from Max Hendrick, III, Partner, Vinson & Elkins LLP, to James V. Derrick, Jr., Executive Vice President & General Counsel, Enron Corp.) (containing Vinson & Elkins' report and recommendations).
143. (Describing Vinson & Elkins' role as providing "substantial advice" on the disclosures of transactions with Enron's affiliated entities)
144. Destruction of Enron-Related Documents by Andersen Personnel: Hearing Before the Subcomm. on Oversight and Investigations of the H. Comm. on Energy and Commerce, supra note 92, at 53.
145. See, e.g., Dan Ackman, Enron's Lawyers: Eyes Wide Shut?, FORBES.COM (Jan. 28, 2002, 12:16 PM), http://www.forbes.com/2002/01/28/0128veenron.html.
146. (Noting that "plaintiffs and prosecutors could argue V&E 'turned a blind eye'...and use the [Vinson & Elkins report] to draw the lawyers even deeper inside the Enron circle" (quoting Richard Epstein, Professor, University of Chicago)).
147. Mike France, Commentary, Close the Lawyer Loophole, BUS. WK., Feb. 2, 2004, at 70, 70 ("Corporate lawyers are almost never sent to jail for helping out whitecollar criminals.")
148. Michael Orey, Lawyers: Enron's Last Mystery, BUSINESSWEEK.COM (June 1, 2006), http://www.businessweek.com/investor/content/may2006/pi20060531_972686.htm.
149. See Ex-Enron Law Firm to Pay $30 Million, N.Y. TIMES, June 2, 2006, at C5 (reporting on the settlement with Enron).
150. (Attributing Enron's failure to comply with its disclosure obligations in part to the "absence of... objective and critical professional advice by... Vinson & Elkins"), with Clark, supra note 60, at 458 ("The [August 2002] memorandum purported to provide objective legal advice.... Nevertheless, its assertions about the state of the law are so inaccurate that they seem to be arguments about what the authors... wanted the law to be rather than assessments of what the law actually is.")
151. See Notice of Charges and of Hearing for Cease and Desist Orders to Direct Restitution and Other Appropriate Relief; Notice of Intention to Remove and Prohibit from Participation in the Conduct of the Affairs of Insured Depository Institutions; Notice of Intention to Debar from Practice Before the Office of Thrift Supervision, In re Fishbein, OTS AP-92-10 (Mar. 1, 1992).
152. Reprinted in Jonathan J. Lerner, The Attorney-Client Relationship After Kaye, Scholer 237 (1992).
153. See Steve France, Just Deserts: Don't Cry for Kaye, Scholer, LEGAL TIMES, Apr. 6, 1992, at 28.
154. (quoting Kaye Scholer's defense attorney's observation that the firm defined its obligations in terms of litigation because that characterization provided the "'broadest leeway'... to 'characterize facts in a light favorable to the client and even withhold damaging information, unless required by law to provide it'").
155. See William H. Simon, The Kaye Scholer Affair: The Lawyer's Duty of Candor and the Bar's Temptations of Evasion and Apology, 23 LAW & SOC. INQUIRY 243 app. (1998).
156. (Summarizing the OTS charges and the law firm's responses); see also Susan Beck & Michael Orey, They Got What They Deserved, AM. LAW., May 1992, at 68, 74.
157. (Characterizing Kaye Scholer's argument that they acted in the role of "litigation counsel" as "an attempt to avoid being charged under... [t]he bank board reg[ulation] in effect at the time").
158. See Simon, supra note 104, at 246-48 (providing background on the financial climate surrounding the Lincoln investigation)
159. See Simon, supra note 104, at 248-51 (describing the OTS charges against Kaye Scholer)
160. ("[N]umerous internal Kaye, Scholer memos describe in vivid detail problems with Lincoln's operations.... To the OTS looking for evidence that Kaye, Scholer knew about Lincoln's problems and helped its client hide them, these documents must have looked like smoking guns.")
161. (Describing the terms of the settlement against the law firm and the court order against the Kaye Scholer partners who directed the firm's response to the OTS investigation)
162. David Margolick, Lawyers Under Fire, N.Y. TIMES, Mar. 10, 1992, at A1.
163. (Reporting the firm's use of the "litigation counsel" argument in its public statements)
164. Edward Brodsky, The 'Kaye, Scholer' Case, N.Y. L.J., May 22, 1992, at 1.
165. (criticizing the OTS's "extraordinary action" in freezing Kaye Scholer's assets during the investigation)
166. W. John Moore, Clubbing Counsel, NAT'L J., July 25, 1992, at 1714.
167. (quoting Proskauer Rose Goetz & Mendelsohn partners' position that the investigation "threatens to fundamentally change the role of lawyers for, and the relationship of lawyers to, federally insured financial institutions")
168. See Amy Stevens & Paulette Thomas, Legal Crisis: How a Big Law Firm Was Brought to Its Knees by Zealous Regulators, WALL ST. J., Mar. 13, 1992, at A1.
169. (Describing Kaye Scholer partner Peter M. Fishbein "as a litigator who measured his professional worth under a code of conduct that demanded unstinting loyalty to the client, [who] wasn't about to let some bureaucrat tell him otherwise").
170. (discussing the flaws of Kaye Scholer's "litigation counsel" argument)
171. ("[The] biggest weakness [in Kaye Scholer's position] is its very premise, that this was a litigation, rather than a regulatory, setting. Saying it was 'litigation' doesn't make it so.")
172. (Invoking the notion of "unstinting loyalty to the client" as a defense of Kaye Scholer's conduct)
173. (Questioning whether a lawyer's role is "that of [a] zealous advocate for the client")
174. See, e.g., Fred. C. Zacharias, The Future Structure and Regulation of Law Practice: Confronting Lies, Fictions, and False Paradigms in Legal Ethics Regulation, 44 ARIZ. L. REV. 829, 855 (2002).
175. ("[T]he Kaye, Scholer incident called into question the codes' paradigm of lawyers as advocates." (footnote omitted)).
176. ("As an advisor, a lawyer is not an advocate.")
177. This convergence is particularly notable in light of the disparate roles played by the lawyers in each case. The Kaye Scholer attorneys mediated between Lincoln Savings & Loan and a federal banking regulator, Vinson & Elkins advised on Enron's compliance with its disclosure obligations regarding transactions that were structured by the law firm, and the torture memos were penned by a government attorney interpreting the limitations imposed on interrogations of detainees held by the CIA and the military.
178. MODEL RULES OF PROF'L CONDUCT R. 1.2(d) (2009).
179. See Susan P. Koniak, The Law Between the Bar and the State, 70 N.C. L. REV. 1389, 1409-27 (1992).
180. (Discussing how the law and the professional rules advance different conceptions of the lawyer's role and appropriate behavior)
181. ("[A]bout half the states have disciplinary agencies that are nominally independent of the organized bar....")
182. ("The ABA Standards are the most common source of guidance in the sanctioning process.")
183. See STANDARDS FOR IMPOSING LAWYER SANCTIONS § 1.1 (1992).
184. (Identifying enforcement of duties owed "to clients, the public, the legal system, and the legal profession" as the purpose of disciplinary proceedings)
185. See GEOFFREY C. HAZARD, JR., SUSAN P. KONIAK & ROGER C. CRAMTON, THE LAW AND ETHICS OF LAWYERING 918 (3d ed. 1999).
186. (describing the use of a "preliminary prosecutorial review to determine probable cause" in lawyer disciplinary proceedings conducted in most jurisdictions)
187. (Quoting Geoffrey C. Hazard, Jr. & Cameron Beard, Comment, A Lawyer's Privilege Against Self-Incrimination in Professional Disciplinary Proceedings, 95 YALE L.J. 1060, 1066-67 (1987)).
188. See COMM. ON DISCIPLINARY ENFORCEMENT, AM. BAR ASS'N, LAWYER REGULATION For A NEW CENTURY 1-9 (1992).
189. (Providing background in support of the recommendation that the judiciary, rather than the legislature, should conduct professional regulation of lawyers)
190. See ANNOTATED MODEL RULES OF PROF'L CONDUCT pmbl. annot. (2007) ("The Rules of Professional Conduct govern lawyer discipline.")
191. ("Bar codes of conduct claim to protect the public, but the public has had almost no voice in their formulation or enforcement.")
192. See STANDARDS FOR IMPOSING LAWYER SANCTIONS § 1.1 (1992).
193. ("The purpose of lawyer discipline proceedings is to protect the public and the administration of justice from lawyers who have not discharged. .. their professional duties.")
194. (arguing that the legal profession's "freedom from external accountability too often serves the profession at the expense of the public"); Koniak, supra note 121, at 1395-1402 (describing the law and the professional rules as distinct but interdependent normative systems)
195. See MELVIN ARON EISENBERG, THE NATURE OF THE COMMON LAW 150 (1988)
196. ("In terms of structure, the combination of a representative conception, highly diverse training and experience, and responsiveness and accountability to the citizenry on an ongoing basis provides legitimacy to legislative rules....")
197. See, e.g., Lawrence v. Texas, 539 U.S. 558, 571 (2003) (confronting the limitations on the power of a political majority to use the criminal laws to enforce its moral views).
198. JOEL FEINBERG, DOING AND DESERVING 100 (1970)
199. ("[I]t can be said that punishment expresses the judgment. .. of the community that what the criminal did was wrong.")
200. Henry M. Hart, Jr., The Aims of the Criminal Law, 23 LAW & CONTEMP. PROBS. 401, 404 (Summer 1958).
201. ("What distinguishes a criminal from a civil sanction and all that distinguishes it. .. is the judgment of community condemnation which accompanies and justifies its imposition.")
202. See STANDARDS FOR IMPOSING LAWYER SANCTIONS theoretical framework, para. 1 (recognizing that, by virtue of their expertise, lawyers have been given the power to make certain types of decisions for the public).
203. See MODEL RULES OF PROF'L CONDUCT pmbl., para. 1 (2009) (acknowledging that lawyers have a "special responsibility for the quality of justice" in relation to the general public).
204. (recognizing that government regulation of the legal profession is unnecessary "[t]o the extent that lawyers meet the obligations of their professional calling" and that failure to observe these obligations "compromises the independence of the profession" (emphasis added))
205. ("There is reason to think... that a strong motivation for lawyer discipline is to reassure a doubtful public that notorious instances of lawyer depredation are being handled appropriately.")
206. ("[O]ne of the ABA's express goals in developing professional regulation has been to supplant and obviate the need for regulation by lay institutions.")
207. James C. Turner & Suzanne M. Mishkin, Time for a Whupping: Across the Country, Attorney Discipline Systems Disgrace the Profession, LEGAL TIMES, Aug. 18, 2003, at 58.
208. (noting that the District of Columbia Bar Agency's mission to "protect the public and the courts from unethical conduct by" lawyers while also "protect[ing] members of the D.C. Bar" requires disciplinary bodies to perform "conflicting missions").
209. ("[I]t is the criminal law which defines the minimum conditions of man's responsibility to his fellows and holds him to that responsibility.")
210. (Describing the professional rules' incorporation of and deference to criminal norms). But see Koniak, supra note 121, at 1410 (observing that the public law may depend upon the legal profession for its existence as much as the bar depends upon the law).
211. See STANDARDS FOR IMPOSING LAWYER SANCTIONS § 2.1 (1992) (defining the scope of sanctions).
212. ("The ABA standards are the most common source of guidance in the sanctioning process.")
213. The penalties imposed by lawyer disciplinary proceedings apply only to the lawyer's professional privileges
214. See STANDARDS FOR IMPOSING LAWYER SANCTIONS §§ 2.2-2.8 (listing forms of sanctions).
215. See 18 U.S.C. § 3553(a)(2)(A) (2006) (instructing the sentencing judge to consider the need for the sentence imposed "to reflect the seriousness of the offense, to promote respect for the law, and to provide just punishment for the offense")
216. See Herbert Wexler, The Challenge of a Model Penal Code, 65 HARV. L. REV. 1097, 1098 (1952).
217. ("[P]enal law governs the strongest force that we permit official agencies to bring to bear on individuals.")
218. cf. United States v. Bass, 404 U.S. 336, 347-48 (1971) (explaining that the rule of lenity originates partly in recognition of the especially severe effects of criminal punishment in constraining the individual).
219. STANDARDS FOR IMPOSING LAWYER SANCTIONS § 1.1.
220. ("Modern courts have repeatedly observed that 'lawyer discipline is not intended to punish the offending lawyer but to protect the public.'" (citation omitted)).
221. ("[M]uch lawyer discipline seems to fit within the classic justifications of punishment: incapacitation, rehabilitation, and deterrence.")
222. STANDARDS FOR IMPOSING LAWYER SANCTIONS § 1.1.
223. See SANFORD H. KADISH, STEPHEN J. SCHULHOFER & CAROL S. STEIKER, CRIMINAL LAW AND ITS PROCESSES 1 (8th ed. 2007).
224. ("The criminal justice system is society's primary mechanism for enforcing standards of conduct designed to protect the safety and security of individuals and the community.")
225. ("[C]riminal law[] aims to shape people's conduct along lines which are beneficial to society....")
226. See STANDARDS FOR IMPOSING LAWYER SANCTIONS preface, para. 2.
227. (noting that many states have adopted the ABA Standards and that the ABA's Standing Committee on Professional Discipline continues to assist state discipline systems in implementing the standards)
228. STANDARDS FOR IMPOSING LAWYER SANCTIONS theoretical framework, para. 3.
229. ("[B]ar agencies depend almost entirely on complaints from clients. .. as a basis for disciplinary investigations."); see also RESTATEMENT (THIRD) OF THE LAW GOVERNING LAWYERS §§ 49-50 (1998) (describing duties owed to clients); id. § 51 (limiting the range of nonclients to whom a lawyer owes a duty of care).
230. ("[R]elatively few clients have sufficient incentives or information to initiate disciplinary proceedings.")
231. See STANDARDS FOR IMPOSING LAWYER SANCTIONS preface, para. 9.
232. ("[In 1970], [o]ne of the most significant problems in lawyer discipline was the reluctance of lawyers and judges to report misconduct. That same problem exists today.")
233. (Noting that the duty to report professional misconduct imposed by the Model Rules of Professional Conduct "is widely ignored" among lawyers)
234. (Describing a "'there but for the Grace of God go I' attitude" among judges and bar leaders that deters reporting)
235. ("[D]isciplinary agencies are generally underfunded and understaffed.. .. The absence of resources also prevents agencies from undertaking independent investigations and limits the assistance that they can provide to individuals who wish to file grievances.")
236. See, e.g., Using a Lawyer: Don't Hire a Legal Professional Before Reading this Book, LEGAL REFORMER, Jan.-Mar. 2009, at 1, available at http://www.halt.org/the_legal_reformer/2009/pdf/TLR-Winter09.pdf.
237. (Advertising legal consumer resource providing information about professional discipline). Civil society groups have referred complaints to state bar associations about the conduct of lawyers involved in creating the United States' interrogation policies under the Bush administration, including John Yoo.
238. See Justin Blum, Activists Seek Disbarment of Bush Lawyers Over Interrogations, BLOOMBERG (May 18, 2009, 2:00 PM EDT), http://www.bloomberg.com/apps/news?pid=washingtonstory&sid=aIpMTqMafwrw(reporting the submission of complaints against Yoo and Jay Bybee).
239. ("[D]isciplinary complaint processes. .. rely almost exclusively on clients as a source of information about ethical violations.")
240. ("Without external checks, [lawyers who regulate other lawyers] too often lose perspective about the points at which occupational and societal interests conflict.")
241. See MODEL RULES OF PROF'L CONDUCT R. 1.2(d) (2009).
242. ("A lawyer shall not counsel a client to engage, or assist a client, in conduct that the lawyer knows is criminal or fraudulent. .. .")
243. See Bruce A. Green, The Criminal Regulation of Lawyers, 67 FORDHAM L. REV. 327, 353 (1998).
244. ("In some situations. .. there is a tension between the criminal law and professional norms derived from other sources. In the rare case, this occurs because the criminal law proscribes conduct that would otherwise be... required by professional norms.")
245. (Describing conflicts between professional norms and the law)
246. ("[T]he failure to identify either the policies or reality of disciplinary enforcement makes more difficult the task of coordinating discipline with other methods of sanctioning misconduct.")
247. (Discussing the derivative nature of accomplice liability)
248. Other commentators have analyzed this distinction using the language of "boundaries" and "edges," implying that the lawyer who blurs the distinction engages in misconduct
249. (examining the obligations of lawyers advising their clients at the "knife's-edge limits of the law")
250. Joel S. Newman, Legal Advice Toward Illegal Ends, 28 U. RICH. L. REV. 287, 290 (1994).
251. ("In substantive law cases, courts have struggled to draw the line between mere advice, which does not involve the lawyer in criminal activity and liability, and some further, active participation, which does.")
252. Michael E. Tigar, What Lawyers, What Edge?, 36 HOFSTRA L. REV. 521, 527 (2007).
253. (Proposing the distinction between advice and advocacy as a "duality" that contributes to a definition of permissible and impermissible lawyer conduct). This conception is also featured in some model rules.
254. See, e.g., RESTATEMENT (THIRD) OF THE LAW GOVERNING LAWYERS § 8 cmt. b (1998).
255. (Observing that a lawyer acting as an advisor "may... cross the divide between appropriate counseling and criminal activity").
256. (locating the "critical distinction" between culpable and innocent advising activity referred to in Comment 6 to Model Rule 1.2 in the content of the advice given by the lawyer).
257. (Discussing proof of intent and the doctrine of "presumed intent")
258. (Identifying the elements of knowledge and legal indeterminacy as principal factors in determining whether a lawyer intentionally engaged in criminal conduct in violation of Model Rule 1.2(d)).
259. ("[L]awyers can indeed be accomplices in crimes by giving their clients legal advice for the purpose of aiding or assisting the client in a project known to consist of acts constituting a criminal offense.")
260. See, e.g., United States v. Cavin, 39 F.3d 1299, 1306 (5th Cir. 1994) (requiring proof of fraudulent intent to sustain a conviction of conspiracy to commit fraud).
261. ("It is impossible to look into a lawyer's head, and it is unacceptable simply to take her word for her state of mind when the probity of her own conduct is at issue.")
262. ("[C]ircumstantial evidence must also be the (sole) basis for inferring a lawyer's actual knowledge or belief. .. ."); see also LAFAVE & SCOTT, supra note 3, at 226 (noting that a criminal defendant's intentions "must be gathered from his words (if any) and actions in the light of all the surrounding circumstances").
263. (Discussing the accomplice's intent to further the primary actor's goal)
264. ("[T]he problem [in providing advice on suspicious activity] is to assess... the level of certainty that the client will actually misuse the information.")
265. ("A lawyer, on the basis of then known facts, might legitimately begin a representation in furtherance of a client enterprise thought to be lawful. If the lawyer later discovers facts indicating that the enterprise is unlawful, the latter state of knowledge generates a new duty and the lawyer may no longer assist the client.")
266. ("It is sometimes suggested that. .. a lawyer cannot 'know' what a client intends. This suggestion is either disingenuous or absurd.... [T]he practice of law is based on practical knowledge.... The question, therefore, is what degree of certainty imposes legal obligations on one who 'knows'?").
267. ("Even where a violation requires proof of [actual] 'knowledge,' the circumstances may be such that a disciplinary authority will infer that a lawyer must have known.")
268. (Discussing the advisor's professional obligation to advise the client of the potential that the client's proposed course of conduct is illegal)
269. ("The narrowest connotation of illegality is conduct violative of the criminal law that is mala in se. Although mala in se has no precise definition, it generally comprehends conduct that any civilized society would regard as obnoxious....")
270. (Distinguishing mala in se offenses from those that are mala prohibita)
271. See, e.g., Prosecutor v. Furund'ija, Case No. IT-95-17/1-T, Judgment, ¶ 154 (Int'l Crim. Trib. for the Former Yugoslavia Dec. 10, 1998) ("[T]he jus cogens nature of the prohibition against torture articulates the notion that the prohibition has now become one of the most fundamental standards of the international community.")
272. Cf. STEPHEN L. PEPPER, Counseling at the Limits of the Law: An Exercise in the Jurisprudence and Ethics of Lawyering, 104 YALE L.J. 1545, 1578 (1995).
273. (Proposing a rule making the malum in se status of a client's proposed activity a factor in determining whether the lawyer must refuse to give advice)
274. ("[A] client may be impelled... to aggressively push legality to its limits, and possibly beyond. It would be improbable that a lawyer could perform the lawyerly function of advice-giving in such a situation in the same way in which a lawyer advises on legally and morally unquestionable transactions.")
275. ("Partisan advocacy plays [an] essential part [in litigation], and the lawyer pleading his client's case may properly present it in the most favorable light. A similar resolution of doubts in one direction becomes inappropriate when the lawyer acts as counselor. The reasons that justify and even require partisan advocacy in the trial of a cause do not grant any license to the lawyer to participate as legal adviser in a line of conduct that is... of doubtful legality.")
276. (describing "unsuggestive advice" as "the least instrumental form of assistance that a lawyer can provide a client" in pursuing an unlawful objective)
277. ("[A] lawyer must avoid replacing a sound professional judgment about the limits of the law with a wished-for ambiguity in legal proscriptions in a one-sided search for justification for a client's dubious projects.")
278. This advocacy, whether it is characterized as deliberate influence, inducement, or provocation, amounts to more than mere "advice." .
279. See MONROE H. FREEDMAN, LAWYERS' ETHICS IN AN ADVERSARY SYSTEM 60 (1975).
280. (Asserting that Code of Professional Responsibility DR 7-102(A)(7), which prohibits lawyers from counseling or assisting their clients in conduct that the lawyer knows to be illegal, requires "an active kind of participation in the client's illegal act, going beyond merely giving advice about the law")
281. ("[The torture memo's] assertions about the state of the law are so inaccurate that they seem to be arguments about what the authors... wanted the law to be rather than assessments of what the law actually is.")