New Jersey White Collar Defense Lawyer & Attorney : Fox Rothschild Law Firm : Criminal Defense, Insider Trading, RICO, Consumer Fraud : New Jersey, New York City

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Since the vast majority of white-collar offenses are crimes of intent, it is widely thought that a defense based on “advice of counsel” is generally available in defending those cases.  However, a district court in the Fifth Circuit which recently explored the defense found it generally not available unless the particular offense charged additionally required proof of willfulness and was a “complex” offense.

Joseph Impastato, a municipal official in Louisiana, entered into a partnership with two business persons as a result of which certain Hurricane Katrina clean-up work was steered in the direction of their entity.  Impasto’s partners required him to provide an opinion letter setting forth the legitimacy of such a relationship, and in due course he came up with such a letter.

When Impastato was charged with violations of the Hobbs Act (18 U.S.C. § 1951),  federal program fraud (18 U.S.C. § 666), and money laundering (18 U.S.C. § 1956) for obtaining the clean-up work, he sought to offer the attorney opinion letter in his defense to negate the intent elements of the subject offenses.  However, the district court ruled that the opinion letter was inadmissible because it was not relevant.  United States v. Impastato, 543 F. Supp.2d 569 (E.D. La. 2008).

 

Relying on Fifth Circuit case law, the Impastato court held that the advice of counsel defense applied only to refute the “willfulness” element of an offense, that is, the requirement that an act be committed voluntarily and purposely, with the specific intent to do something the law forbids.  Id. at 574 (citing Fifth Circuit Pattern Jury Instructions).  Where a federal offense, such as mailing obscene materials, did not require that a defendant have knowledge of the illegal status of the materials, advice of counsel was not a defense. Id.

 

The court analyzed each of the charged offenses -- it noted that the color of official right Hobbs Act violation required only simple knowledge that the defendant had obtained a payment to which to which he was not entitled, knowing that the payment was made in return for official acts; that money laundering required only the knowledge that the proceeds were derived from some unlawful activity and knowledge that the transaction was designed to conceal the source or origination of the proceeds; and that program fraud required only “corrupt” action.  Id. at 575-578.   

Thus, in none of the charged offenses was "willfulness" an essential element.  Id.  The court concluded that the advice of counsel defense is reserved, at least in the Fifth Circuit, “mainly for violation of ‘complex’ statutes” (citing cases; including tax fraud, false subscribing of tax returns).  Id.  It is "inappropriate” for less complex crimes (citing cases; including mailing obscene materials, illegal receipt of firearm). 

 

Arguably, the Impastato court’s reading of the elements of some commonly-charged specific intent offenses is too narrow, reading the "willfulness" requirement out of those statutes.  In the District of New Jersey, however the government’s own charging habits may provide a basis for the advice of counsel defense even when a narrow reading of the statutory elements might preclude it.  Commonly- charged offenses such as mail and wire fraud are often expressed in terms of both knowing and “willful” conduct by a defendant.  Even within the narrow parameters of a decision like Impastato, the advice of counsel defense would arguably be available against an offense charged in that fashion.