Political Logrolling Approved by Seventh Circuit

It has been a banner season for politically important public corruption rulings. Two weeks ago the Fourth Circuit issued its opinion upholding the conviction of former Virginia Governor Bob McDonnell. See our analysis of that opinionhere. Now the Seventh Circuit has ruled in the case of former Illinois Governor Rod Blagojevich. And while the Seventh Circuit had little patience for Governor Blagojevich’s conduct, its ruling is groundbreaking in certain respects and provides some breathing room for public officials.

Governor Blagojevich’s problems arise generally from events surrounding then-Senator Barack Obama’s election to the Presidency in November, 2008. Obama’s election to the White House created a vacancy in the United States Senate, and Blagojevich, as Illinois Governor, was empowered to fill the seat. The appointee would serve until an election could be held for a permanent replacement. And, “Blagojevich viewed this opportunity to appoint a new Senator as a bonanza.” United States v. Blagojevich, No. 11-3853, slip op. at 2 (7th Cir, July 21, 2015).

The Court had no problem with the Government’s evidence overall and affirmed 13 of the total 18 counts of conviction. But the Court vacated Blagojevich’s convictions for attempted extortion under 18 U.S.C. §§ 1951 and 1952, the corrupt solicitation of funds under 18 U.S.C. §§371 (conspiracy) and 666(a)(1)(B), and wire fraud under 18 U.S.C. §§ 1343 and 1346. The Court found a problem with the jury instructions as to these counts because it concluded that the jury could have convicted the Governor on these counts solely because he proposed trading “one public act for another.”Id. at 5.

Had the Government’s evidence on the problematic counts turned solely on Blagojevich’s efforts to obtain cash or charitable or campaign contributions, it’s likely the Court would have sustained these counts as well. But, the evidence offered by the Government to prove these counts included evidence that Blagojevich had proposed to the President-elect that he (Blagojevich) would appoint one of the President-elect’s closest advisors, Valerie Jarrett, to the vacant Senate seat if Blagojevich was appointed to the President’s cabinet. And therein lies the problem.

The Governor’s offer to appoint Ms. Jarrett was an offer to use his official authority in a particular manner. And his request that he be appointed to the Cabinet sought the reciprocal use of authority by another public official, the President of the United States. The Court of Appeals characterized the proposal as a “common exercise in logrolling.” Id. at 6. And, the Court noted, logrolling – the “exchange of political favors” – has never been the basis of a reported federal prosecution. It noted further, that “[i]t would be more than a little surprising to Members of Congress if the judiciary found in the Hobbs Act, or the mail fraud statute, a rule making everyday politics criminal.” Id. at 6-7.

The Court then worked through each of the Government’s theories and concluded that the charged statutes did not and could not criminalize logrolling. The Hobbs Act statute, 18 U.S.C. § 1951, defines extortion as “obtaining property from another, with his consent, induced . . . under color of official right.” And the Court concluded that the Governor’s actions did not meet this standard because neither the Governor, nor the President in return, had a property interest in those positions. Put more plainly, the appointment power belonged to them only by virtue of their political office and is not a transferable property right. As such, the Court concluded, it cannot form the basis for an extortion charge where the inducement is the exercise of positional power by another public official. There is no property changing hands.

Analyzing the Government’s case under 18 U.S.C. § 666, the Court likewise found logrolling permissible there. Section 666 prohibits theft or bribery in publicly funded programs. Analyzing the requirement that the charged official must act “corruptly,” that is he must understand the offer to trade favors as a bribe, the Court broadly defined the exchange of political favors as the “usual course of business in politics” and cast it outside the definition of the word “corrupt.” Id. at 8.

Finally, the Court reviewed the wire fraud charge. Here the Court concluded that to characterize Blagojevich’s conduct as fraud whereby he deprived the public of its right to his honest services “supposes an extreme version of truth in politics, in which a politician commits a felony unless an ostensible reason for an official act is the real one. Id. at 9. Again, finding the exchange of political favors between public officials to be commonplace the Court, in effect, included such exchanges within the scope of honest political service as a matter of law.

The Blagojevich Court then spent several pages recounting historical stories, some amounting to nothing but speculation, in an attempt to demonstrate the extreme and illogical conclusion of the Government’s position. The Court suggested that the current Secretary of State, John Kerry, and the current President might be culpable under the Government’s theory because the Court assumed that Secretary Kerry attained his position at the State Department as the result of political favors done for the President and his Administration. Likewise, the Court noted that former Chief Justice Earl Warren and former President Dwight Eisenhower may have also committed a crime if, as historical speculation suggests, Chief Justice Warren was appointed to the Supreme Court in return for his role in assisting President Eisenhower politically in California. In each case, the Court mused, an appointment may have been made by the respective President in return for political service and favors. Returning again and again to its view that political deal-making is essential to our form of Government, the Court declined to criminalize the exchange of purely political favors between public officials.

The McDonnell decision affirmed that an officeholder’s conduct and relationships over time can form the basis of a conviction for honest services fraud and for Hobbs Act extortion even when the actions taken by the public official are routine or common in nature. The Fourth Circuit rejected that position but held that, in order to obtain and sustain a conviction, prosecutors must demonstrate that the official obtained something of value (that is property) in return for the performance of some official act. The Blagojevich Court tells us, however, that the “something of value” can’t be an official act performed by another public officeholder.

As we attempt to draw guidance from the two decisions, we can cautiously conclude several things. First, deal-making between two public officials is likely to be seen as “politics as usual” and not an appropriate basis for a criminal investigation or prosecution. Provided that the exchange is limited to the swap of official acts between two public officials, those actions should be beyond criminal review. Second, the introduction of money, other tangible items, or something of value apart from the exercise of official decision-making, will potentially place the issue within the Justice Department’s crosshairs. And, participation by third parties who provide the “property” to the public official will move the matter well outside the zone of protection the Blagojevich Court has created.