Daley Patronage Chief Loses Appeal Updated X1
Add comment April 15th, 2008
In a decision that appears to not bode well for public officials facing federal corruption probes, the 7th Circuit U.S. Court of Appeals today ruled against Chicago Mayor Richard Daley’s patronage chief:
The defendants created an illegitimate,
shadow hiring scheme based on patronage and cronyism
by filling out sham interview forms, falsely certifying
that politics had not entered into their hiring, and covering
up their malfeasance. These are the hallmarks of a fraud.
From the AP story:
Witnesses testified at trial that “patronage armies” had been formed in city departments and deployed into the city¹s wards and precincts on Election Day to round up votes for Daley and candidates he supported.
Testimony indicated Sorich and those under him faked test scores and job interview evaluations to make it appear the rules barring political affiliation as a factor in hiring decisions were being followed — but that people who took part in the patronage armies would get jobs.
City officials are banned by the long-standing Shakman Decree from hiring most municipal employees based on their political affiliation.
But patronage has been part of Chicago politics since anyone can remember and the decree long went all but ignored.
The simplified question here is whether the feds must show a smoking gun — a bribe changing hands, for instance — to prove a public corruption case. The appeals court said that in this case, the feds do not.
The defendants’ argument that any private gain must go
to the defendants themselves is not without basis, for
we and other courts have not always been consistent
with our description of the requirement. Although
McNally itself and the key portions of Bloom refer to
“private gain,” Bloom also once uses the phrase “personal
gain,” 149 F.3d at 657, and in United States v. Hausmann,
345 F.3d 952, 956 (7th Cir. 2003), we used “personal gain”
exclusively. Other circuits have also described our requirement
as a “personal gain” or “personal benefit.” …The semantic difference between “private”
and “personal” gain may be insignificant, but to the extent
that “personal” connotes gain only by the defendant, it
is misleading. By “private gain” we simply mean illegitimate
gain, which usually will go to the defendant, but
need not.Imagine scenario (A) in which a mayor surreptitiously
channels city contracts to his cronies in the business
community; they get a windfall whereas he has merely
helped his friends and takes no money. Or imagine scenario
(B) in which an attorney bribes a court in order to
obtain favorable results for his clients in their lawsuits. Or
scenario (C) where a union boss sells union property to
a senator even though the senator did not offer the
highest price, and in exchange receives the senator’s vote
on a matter that concerns the union. In all three scenarios
the public has been defrauded of the honest services of its
public servants: the mayor, the court, and the senator.
Moreover, in all three scenarios the defendant—the mayor,
the attorney, and the union boss—was not the one
who stood to gain financially. Certainly the defendants all
received something: in (A), the mayor received the gratitude
of his friends; in (B), the attorney could boast to
future clients of a high success rate, which is good for
business; and in (C) the union boss curried valuable favor
with the senator. But the money went to another party. All
three scenarios have played out in the federal courts and
have resulted in convictions for mail fraud. …These cases are the exception to a rule of human nature
rather than of law: usually someone up to no good will be
out to enrich himself, not others. It is thus with a hint of
irony that we stated in United States v. Spano, 421 F.3d 599,
603 (7th Cir. 2005), that “[a] participant in a scheme to
defraud is guilty even if he is an altruist and all the benefits
of the fraud accrue to other participants.” The defendants
seize on Spano’s “other participants” language and
contend that fraud exists when private gain goes to other schemers, as in the above three examples, but not when it oes to third parties. We disagree. It is much less likely—but
no less culpable—that fraudulent schemers will share the
proceeds with third parties rather than amongst themselves. …In Hausmann, 345 F.3d at 954, 956, an attorney
referred clients to a chiropractor friend in exchange for a
percentage of the business brought in by each referral; he
did not tell his clients about his take. The chiropractor
made good by paying the attorney’s creditors and his
favorite charities, and we affirmed the attorney’s conviction.
Id. But suppose the attorney had stated that he only
wanted the kickbacks to go to charities, or, for that matter,
to his estranged brother, about whom the attorney had
always felt guilty. Unlikely scenarios, maybe, but mail
fraud nevertheless. Robin Hood may be a noble criminal,
but he is still a criminal. “In the case of a successful
scheme, the public [or client] is deprived of its servants’ [or
attorney’s] honest services no matter who receives the
proceeds.”
UPDATE 1
The Tribune has more:
In a key win for federal prosecutors, an appellate court in Chicago on Tuesday upheld the convictions of four former top aides to Mayor Richard Daley who were convicted of rigging hiring and promotions at City Hall.
Former Daley patronage chief Robert Sorich and co-defendants were found guilty in 2006 of doling out jobs to reward members of political armies who campaigned for favored candidates.
On appeal, lawyers for the former city aides argued that they could not be convicted of criminal fraud because they took no bribes or kickbacks in the scheme. But a three-judge panel of the 7th U.S. Circuit Court of Appeals disagreed.
