Obstruction of justice: unwarranted expansion of 18 U.S.C.

• Author: Schrup, Sarah O'Rourke
• Position: Section - C - 1

This Article suggests that prosecutors are misusing and courts are misinterpreting the Sarbanes-Oxley obstruction of justice statute, 18 U.S.C. [section] 1512(c)(1). As a result, the statute is being applied far beyond the corporate fraud or even general fraud context to conduct that Congress never intended to punish with this statute. Such an expansive interpretation lays bare the ambiguity inherent in the statutory language. A proper statutory construction that explores the statute itself, related provisions, canons of construction, the legislative history, and the investigatory process at the Securities and Exchange Commission shows that Congress could not have intended the limitless sweep of the statute that some courts and prosecutors have fashioned. In fact, an expansive definition of the terms within [section] 1512(c)(1) carries with it a host of unintended and unwanted results. Specifically, such an interpretation is at odds with congressional intent, creates absurdities and unfair sentencing disparities, renders the statute void for vagueness, and encourages judicial and executive legislating. Courts should recognize and limit efforts to expand [section] 1512(c)(1)'s reach.

1. INTRODUCTION

   In response to the 2001 and 2002 accounting scandals involving corporate luminaries such as Enron, WorldCom, Global Crossing, and Adelphia, Congress passed the Sarbanes-Oxley Act of 2002 (Act). (1) Although the Act's preamble is clear that the bill was designed to "protect investors by improving the accuracy and reliability of corporate disclosures made pursuant to the securities laws," (2) prosecutors have since its enactment endeavored to expand its reach far beyond the corporate fraud context. Specifically, prosecutors have used its obstruction of justice provision in 18 U.S.C. [section] 1512(c)(1) in a host of other types of cases, including garden-variety drug possession, (3) police misconduct, (4) and even when a defendant burned the body of a murder victim to conceal his crime. (5) And courts, perhaps unwittingly, have sanctioned this expansive use of [section] 1512(c)(1)'s provisions. This expansion is not only unsupportable under a proper construction of the Sarbanes-Oxley Act, but it creates absurdities in application and renders the statute void for vagueness.

   This Article posits that courts should reject prosecutorial efforts to expand the reach of Sarbanes-Oxley into drug crimes, which are clearly beyond its plain terms and the legislature's intent. A proper construction of 18 U.S.C. [section] 1512(c)(1) and the Sarbanes-Oxley Act generally shows that Congress intended to combat corporate fraud--or at most fraud generally-and not other types of crimes. Part II of the Article conducts an in-depth statutory construction of [section] 1512(c)(1) by reviewing its language, structure, related provisions, canons of construction, legislative history, and the traditional SEC investigations process. Part III then examines how prosecutors have used, and courts have interpreted, [section] 1512(c)(1) in the ten years since its enactment. In Part IV, the Article demonstrates how this unwarranted expansion of [section] 1512(c)(1) leads to absurd and unintended results, and is wrong as a matter of policy. And Part V concludes by arguing that the government should abandon its use of [section] 1512(c)(1) beyond fraud crimes.

2. THE PROPER CONSTRUCTION OF [section] 1512(C)(1)

   Section 1512(c)(1) criminalizes an individual's conduct if that person "corruptly--alters, destroys, mutilates, or conceals a record, document, or other object, or attempts to do so, with the intent to impair the object's integrity or availability for use in an official proceeding." (6) As discussed in more detail below, (7) this provision suffers from at least two textual ambiguities. First, the scope of the phrase "other object" is uncertain. Second, the specificity and temporal reach of the "official proceeding" impacts the statute's breadth. Although a statute's plain, unambiguous language definitively settles its meaning, (8) when statutory language is susceptible to two or more meanings, courts look to interpretive aids to discern congressional intent. (9) The plainness or ambiguity of statutory language is determined by reference to the language itself, the specific context in which that language is used, and the broader context of the statute as a whole. (10) If an ambiguity persists, an act's structure and context, canons of construction, and legislative history assist courts in resolving it. (11) When read in the context of the Act's preamble and the related sections along with the legislative history and relevant canons of construction, it becomes clear that [section] 1512(c)(1) was aimed at preventing corporations from destroying records relevant to federal securities investigations and was not intended to be an omnibus dragnet for a wide assortment of other non-fraud crimes. (12)

   1. THE STATUTE'S STRUCTURE AND CONTEXT

      The structure of the surrounding provisions in the obstruction of justice (OOJ) chapter of Title 18 provides insight into the best interpretation of [section] 1512(c)(1), an add-on provision that was enacted, at least in part, to fill gaps in the existing obstruction statutes. (13) This Section evaluates the statute's structure in four parts: (i) the Act's preamble; (ii) the preSarbanes-Oxley provisions; (iii) the post-Sarbanes-Oxley provisions; and (iv) one additional OOJ provision in Chapter 109 of Title 18.

      1. The Act's Preamble

         The first clue Congress provided that [section] 1512(c)(1) was narrowly tailored towards corporate fraud is located in the Act's preamble. In fact, Congress could not have been clearer about the behavior it intended to capture under the Sarbanes-Oxley criminal provisions. The Act's preamble explicitly states that the bill was designed to "protect investors by improving the accuracy and reliability of corporate disclosures made pursuant to securities laws." (14) Although some courts may give short shrift to an Act's preamble, it nonetheless represents the very first words out of Congress's mouth about the purpose and scope of the Act. In this case, the preamble explicitly refers to the limited types of behavior captured by the criminal provisions in Sarbanes-Oxley. (15)

      2. Provisions Surrounding [section] 1512(c)

         Examining the companion provisions in the OOJ chapter (16) establishes at least three broad precepts that guide statutory interpretation and shed light on legislative intent with respect to [section] 1512(c)(1). First, all of the provisions are limited in either temporal scope or substantive subject matter. This limitation indicates that Congress intended to proscribe a limited set of conduct in narrowly defined parameters. For example, [section][section] 1516-1518 criminalize obstructions of only a few certain types of investigations: federal audits, bank examinations, and health care offenses. (17) Similarly, [section] 1519 limits itself to the destruction, alteration, or falsification of records during federal investigations. (18)

         Significantly, even for those provisions whose titles are worded more broadly, the actual statutory language contains specific limits on the conduct to which it applies. In [section] 1510, for example, which is titled broadly "Obstruction of criminal investigations," the conduct actually criminalized is limited to: (1) those who use bribes to obstruct or delay the delivery of information to an investigator; (2) bank officers who alert customers to audits; or (3) insurance agents who alert customers to investigations. (19) Similarly, [section] 1511 is called "Obstruction of State or local law enforcement," but its application is limited to those who facilitate illegal gambling businesses. (20)

         Thus, there simply is not a limitless omnibus obstruction provision within this chapter, even though Congress could have easily created one that captured all aspects of all federal investigations and judicial and administrative proceedings. (21) Even [section] 1519, a broadly worded provision specifically enacted as a catchall to include investigations and not just official proceedings, (22) limits itself to "records," a distinct limit on its use to prosecute, for instance, drug or gun crimes. (23)

         The second general precept that can be gleaned from a study of the OOJ provisions as a whole is that [section] 1512, "Tampering with a witness, victim, or an informant," which contains a number of discrete subsections, was designed to punish those who tamper with witnesses through threats, violence, or bribery in order to prevent testimony or production of documents. (24) Thus, Congress was concerned in this section with protecting witnesses and victims as well as the integrity of the judicial proceedings that rely on this documentary evidence often as the sole proof of wrongdoing. (25)

         The placement of the Sarbanes-Oxley language in [section] 1512(c)(1) means that it should be read as criminalizing similar, serious conduct that impacts witnesses and victims and threatens the integrity of the proceedings. Under such a reading, destroying drugs during a bust or ditching a firearm during a police chase falls well outside of its ambit. It is true that "[w]hen [section] 1512 was first enacted in 1982, it was not limited to the white-collar crime context," (26) even though those earlier provisions also used the phrase "record, document, or other object." (27) As a threshold matter, that courts have interpreted similar language in the witness tampering provision broadly does not necessarily mean that Congress intended its later-enacted Sarbanes-Oxley provision to be similarly sweeping. (28) Moreover, the differences between subsections (a)(2) and (c)(1), as well as Congress's clearly stated motives in enacting Sarbanes-Oxley, (29) intimates that Congress may not have intended them to be interpreted in lockstep. (30)

         Third, the sentencing structure contained within the...