One man’s convicted felon is another’s father, son

Nowdy, those other blogs are eating your lunch on the Delaughter story.

Maybe so, concerned reader, but I was lost in other thoughts; and, frankly, just not hungry.

Some years ago, I was the guest speaker for a Mother’s Day luncheon held at what was then called the “women’s prison” – a mother talking with other mothers about our shared concerns. I wasn’t hungry then, either.  In fact, as I recall, I started losing my appetite when the first big metal door locked behind me.

Locked doors, however, do not frighten me as much as closed minds.

Stone walls do not a prison make nor iron bars a cage…

I note those who decry the notion of “political prisoners” seem to be, in many cases, prisoners of their own politics – and I hunger for the justice of a vigorous public conversation about judicial bribery and the Supreme Court’s recent decision in Yearger (June 18, 2009):

The Double Jeopardy Clause of the Fifth Amendment provides: “[N]or shall any person be subject for the same offence to be twice put in jeopardy of life or limb.”

While we have decided an exceptionally large number of cases interpreting this provision…Our cases have recognized that the Clause embodies two vitally important interests.

The first is the “deeply ingrained” principle that “the State with all its resources and power should not be allowed to make repeated attempts to convict an individual for an alleged offense, thereby subjecting him to embarrassment, expense and ordeal and compelling him to live in a continuing state of anxiety and insecurity, as well as enhancing the possibility that even though innocent he may be found guilty.” The second interest is the preservation of “the finality of judgments.” …

In Ashe, we squarely held that the Double Jeopardy Clause precludes the Government from relitigating any issue that was necessarily decided by a jury’s acquittal in a prior trial.  We explained that “when an issue of ultimate fact has once been determined by a valid and final judgment” of acquittal, it “cannot again be litigated” in a second trial for a separate offense.

Admittedly, there has been some acknowlegement of the impact of Yearger on co-defendants Paul Minor, Wes Teel, and John Whitfield but the related public conversation has had more  vengeance than vigor for justice.

Stone walls do not a prison make nor iron bars a cage

A vigor for justice transcends the defendants as individuals and looks only at the law.  John Whitfield’s response to the Fifth Circuit’s requests for Supplemental Brief on Double Jeopardy does just that:

Thus, the question before the Court is simple. Considering the acquittal of Judge Whitfield, if Judge Whitfield’s participation in a bribery scheme by accepting money from Mr. Minor was a critical issue of ultimate fact in all of the charges against Judge Whitfield, then the jury verdict that necessarily decided that issue in his favor protects him from prosecution for any charge for which that is an essential element.

In the government’s re-prosecution of Judge Whitfield, each and every charge brought against him included as a critical issue of ultimate fact that Judge Whitfield had participated in a briber)’ scheme by accepting money from Mr. Minor. Double Jeopardy and criminal collateral estoppel, as announced by the Supreme Court in Yeager, therefore prohibit the re-prosecution of Judge Whitfield on any each and every count charged in the third superceding indictment.

All charges brought in the second trial should be dismissed, and the trial should be declared a nullity. The jury in the first trial spoke through its acquittal of Judge Whitfield, finding that he could not have participated in a bribery scheme as alleged. He should immediately be released, and his convictions declared a nullity.

Far more telling of the politics limiting thinking of the Constitutional issued involved is that the applicable portions of Yeager to USA v Minor, Teel and Whitfield are an affirmation of issues raised by co-defendants Whitfield and Minor at the time of their re-indictment and at their second trial:

A scheme to defraud was an essential element of the charges re-prosecuted against Judge Whitfield. The jury’s acquittal of Judge Whitfield of wire fraud in the first trial precludes his having participated in any bribery scheme. The jury’s acquittal of Mr. Minor of mail fraud reinforces that finding. Yeager bars the reprosecution of Judge Whitfield on any of the charges brought against him in the second trial.

On September 13,2005, following Defendants’ first trial and acquittal of Judge Whitfield and Mr. Minor, Mr. Minor filed a Motion for Acquittal arguing, among other things, that the jury’s acquittal on the alleged underlying bribery scheme prohibited retrial on the remaining hung counts under the principles of double jeopardy and resjudicata. The trial court ruled that a filing or objection on behalf of one defendant was applicable to all defendants unless a defendant/appellant expressly opted out of the same…The same basis for acquittal was renewed in the second trial in Mr. Minor’s Motion to Dismiss for Selective Prosecution and Related Due Process Issues on June 2, 2006.

Justice Stevens, writing the Court’s opinion in Yeager, made that clear in his citation of the Court’s decision in Ashe – quoted above and repeated here for emphasis as Ashe was decided by the Supreme Court in 1970, a full 35 years before Whitfield and Minor were exposed to double jeopardy by our government with Judge Wingate consenting:

In Ashe, we squarely held that the Double Jeopardy Clause precludes the Government from relitigating any issue that was necessarily decided by a jury’s acquittal in a prior trial.  We explained that “when an issue of ultimate fact has once been determined by a valid and final judgment” of acquittal, it “cannot again be litigated” in a second trial for a separate offense.

Where does that leave Teel? Probably where he’s always been – collateral damage in an insurance dispute:

The prosecution does not contend that Teel received a personal benefit of any kind; the money went to finance an election campaign. Neither do prosecutors suggest that he took a bribe to throw a case. He did get the benefit of a loan guaranty from Minor, but again that was for campaign finance. Moreover, that was a matter of public record, understood by the parties in the lawsuit. Mississippi ethics rules did not require recusal in such a case at the time, and it was not a practice for Mississippi judges to recuse themselves, particularly in the absence of a motion for recusal by one of the parties.

But what was the “corruption” that was used to prosecute Judge Teel? It seems that Teel presided over a settlement in a litigation between a bank and an insurance company. He didn’t seek the case out, Teel told me–and the jury when the case against him was prosecuted in the James Eastland Federal Courthouse in Jackson. It was assigned to him by another judge.

The insurance company didn’t ask Teel to step aside. In fact, given the way judicial elections are financed in Mississippi, you would be very hard pressed to find a judge who didn’t draw on campaign support either from the trial lawyers bar or from the insurance industry–and sometimes from both.

But the fateful showdown between the bank and the insurance company never went to trial because the parties entered into a settlement. And that presents a very strange premise for a prosecution. The Justice Department’s contention is that the insurance company wouldn’t have entered into the settlement but for the pressure of Judge Teel.

That means the Justice Department has decided to treat the insurance companies and their high-priced lawyers with the sort of special paternalistic deference reserved in the nineteenth century for widows, imbeciles and orphans…

…Now the insurance company and its fancy lawyers were definitely not widows or orphans, and whether they were imbeciles would be a judgment call I am not prepared to make. But for the Bush Justice Department they are, apparently, to be viewed as persons who cannot fend for themselves in the rough-hewn wilderness of Mississippi’s judiciary, lurking as it is with judges whose campaigns were fueled by Democratic money and who are far too familiar with the trial lawyers’ bar.

As my readers know, I am not exactly indifferent on tort reform and similar issues. I spent a good part of my career representing the interests of insurance companies–mostly in negotiating investment transactions, but frequently enough also advising them in connection with domestic litigation brought by pesky trial lawyers. Accordingly, I can’t say that I think much of the Paul Minors of the world and their predatory practices in dealing with manufacturers and insurers. So I decided to roll up my sleeves and look at the underlying claims that formed the basis of the suit that led to these charges against Teel.

Into the Weeds of a Tricky Insurance Case
The case has to do with a policy written by an insurer for the benefit of a bank to cover liability arising from automobiles that the bank financed. In theory of course, the bank’s borrower is supposed to insure his car. What happens, however, when the borrower allows this policy to lapse? That is the nature of the back-up coverage that was provided here. The insurer had written such a policy, and the bank was arguing that it was failing to pay on the policy.

There were two kinds of coverage in question in this suit, a “forced place” insurance contact and “umbrella” coverage. Car buyers would financed the purchase of a car through the bank. The bank, wishing to protect its collateral, would require the buyer to maintain insurance on the car. If the buyer failed or did not obtain such insurance, then the bank “force-placed” insurance coverage on the car and charged the premiums and interest to the buyer, on top of the loan.

Some buyers began to question this practice and began to sue the banks asserting various claims including fraud, breach of fiduciary duty, breach of duty of good faith and fair dealing, breach of contract, violation of various statutes, violation of civil rights, negligence, loss of property rights, loss of reputation, injury to credit, creation of fictitious indebtedness, and mental and emotional distress.

The bank had both a Commercial General Liability (CGL) policy and an umbrella policy with the same insurer. The bank’s CGL policy covered claims of liability for bodily injury, property damage, and personal injury caused by an “occurrence,” that is to say, an accident. The umbrella policy provided additional insurance limits but not wider coverage.

Bodily injury under the CGL policy included mental and emotional distress. The underlying claims against the bank included allegations that the plaintiffs suffered such distress. Property damage under the policy included not only physical injury to tangible property, but also the loss of use of tangible property that is not physically injured. The underlying claims against the bank included allegations that the plaintiffs suffered vehicle repossessions which fit the definition of property damage.

Under the CGL policy, the insurer had a duty to defend the bank if there was any basis for potential liability of the insured for covered claims if you read coverage language the way the bank understands it. The bank asked the insurer to provide coverage and a defense, but the insurer declined to do so.

Now the litigation that Teel had was between the bank and the insurer, not the plaintiffs’ claims against the bank. This was a dispute between two large, financially sophisticated parties–not a crazy or abusive tort case. The issue was the interpretation of specific insurance contract language. It would really depend, as a state law matter, on the position that Mississippi’s highest court took on a contract construction issue. My sense is that the bank’s claim stated what I would call a “plausible argument with substantial equities,” but the insurance company also had some strong points on how the case might go. Of course the insurance company had written the contract language, which is why, as a general premise, ambiguities would not be settled in its favor.

In the end, there was a substantial liability at stake, and the insurer opted to limit that liability by entering into a settlement. The insurer and the bank asked Teel to help mediate or broker a settlement. It seems clear that Teel indicated in the settlement process that he was not likely to come out their way on the contract interpretation issue. The insurer could of course have charged ahead to trial, and appealed its case on the merits up the Mississippi appellate system. Since the question was how the contract was to be interpreted, it would have been the equivalent of a whole new trial in the appeals court. That is to say, whatever Teel did wouldn’t have mattered.

The insurer and its highly qualified counsel decided to settle. They made a calculated judgment. In fact, they knew at the time that the Mississippi Supreme Court was going to decide the precise issue they had before Judge Teel. How? Because the Fifth Circuit Court of Appeals, recognizing the absence of controlling precedent on the point, had certified the question to the Supreme Court for a decision. (Ramsay v. OmniBank, 215 F.3d 502 (5th Cir. 2000).) In settling, the insurer and its lawyers took a calculated risk: they bet that the Mississippi Supreme Court was going to come down on the side of the banks.

They were wrong. In fact, on March 28, 2002, the Mississippi Supreme Court handed down a split decision which came out on the insurance company’s side and against the banks on the question of how the contract was to be interpreted. United States Fidelity & Guaranty Co. v. OmniBank, 812 So.2d 196 (Miss. 2002)(en banc 5-3). I haven’t done the full exercise, but it does appear from reviewing the opinion that the court divided in a very predictable way: the judges who were backed by the Democrats supported the banks, and the judges who were backed by the Republicans supported the insurance industry. Robin Hood, I’d say, was missing from the picture–as he usually is in modern commercial litigation.

Buyer’s Remorse for the Insurance Industry
It looks to me like the prosecution of Judge Teel was motivated by a very emotional case of buyer’s remorse on the part of the insurance company and its lawyers. As it turned out, they didn’t call things correctly. The Supreme Court went their way. The criminal prosecution offered a way to get restitution and overturn the settlement. This is, to put it mildly, not an appropriate use of the criminal justice system. But it’s just the sort of use to which the Bush Justice Department is itching to put it.

Now, I don’t agree with the view that Judge Teel took in the case. In fact, I would have come out on this matter exactly where the Mississippi Supreme Court did: in favor of the insurance industry. After all, I am an insurance company lawyer. On the other hand, the position taken by the Bush Justice Department in prosecuting this case comes suspiciously close to saying that failing to adopt the attitude of an insurance company lawyer is inherently corrupt. That posture is, put quite simply, asinine. But with the full weight of the United States trotted out behind it, and with a curiously sympathetic judge, it might well sound credible to a jury.

The question is not really whether Judge Teel was right, but whether what he did was crooked. And on that point, no credible evidence was offered that he did anything wrong. I’ve scrutinized the record, and I’m convinced that he did nothing wrong, in fact.

Those who hunger for justice often find the cupboards bare.

In the end, however, we are all one – and one man’s convicted felon is another’s father, son..

Stone walls do not a prison make nor iron bars a cage

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