U.S. Supreme Court Overturns "Criminal" Conviction - Administration's Overreach Turned Back, Feb. 25, 2015
Yates v. United States, No. 13-7451
“Anti-Shredding” Financial Fraud Enforcement Against Commercial Fisherman Overturned
Feb. 25, 2015 - Washington, DC/Atlanta: Southeastern Legal Foundation (SLF) today applauded the U.S. Supreme Court decision to overturn the conviction of a commercial fisherman who was charged with a felony under the Sarbanes-Oxley Act’s “anti-shredding” financial fraud provision for tossing undersized fish overboard, which SLF argued in an amicus brief in the case at the merit stage was another glaring example of “overcriminalization” and demonstrated overreaching executive authority.
“The U.S. Supreme Court today struck a blow for common sense and limited government when it overturned the conviction of a commercial fisherman who tossed small fish overboard and was subsequently charged under a felony law designed to protect investors from financial fraud,” said Shannon L. Goessling, Southeastern Legal Foundation executive director and chief legal counsel. “This is an important decision because the Court has once again pulled back overzealous and overreaching executive power – including the so-called ‘overcriminalization’ phenomena we’ve witnesses over the past several years – consistently displayed during the Obama administration.”
The Supreme Court summarized the facts of the case as follows:
"While conducting an offshore inspection of a commercial fishing vessel in the Gulf of Mexico, a federal agent found that the ship’s catch contained undersized red grouper, in violation of federal conservation regulations. The officer instructed the ship’s captain, petitioner Yates, to keep the undersized fish segregated from the rest of the catch until the ship returned to port. After the officer departed, Yates instead told a crew member to throw the undersized fish overboard. For this offense, Yates was charged with destroying, concealing, and covering up undersized fish to impede a federal investigation, in violation of 18 U. S. C. §1519. That section provides that a person may be fined or imprisoned for up to 20 years if he “knowingly alters, destroys, mutilates, conceals, covers up, falsifies, or makes a false entry in any record, document, or tangible object with the intent to impede, obstruct, or influence” a federal investigation.”
Yates was convicted in a federal district court of violating Section 1519, a decision that was upheld at the 11th Circuit Court of Appeals. The Supreme Court overturned the decision.
Justice Ruth Bader Ginsburg, writing for the majority, held that, “Section 1519 was enacted as part of the Sarbanes-Oxley Act of 2002, 116 Stat. 745, legislation designed to protect investors and restore trust in financial markets following the collapse of Enron Corporation. A fish is no doubt an object that is tangible; fish can be seen, caught, and handled, and a catch, as this case illustrates, is vulnerable to destruction. But it would cut §1519 loose from its financial-fraud mooring to hold that it encompasses any and all objects, whatever their size or significance, destroyed with obstructive intent. Mindful that in Sarbanes-Oxley, Congress trained its attention on corporate and accounting deception and cover-ups, we conclude that a matching construction of §1519 is in order: A tangible object captured by §1519, we hold, must be one used to record or preserve information.”