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  • Key case: U.S. v. Sun-Diamond Growers of California

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  •   High Court To Review Espy Probe Conviction

    By Joan Biskupic
    Washington Post Staff Writer
    Tuesday, November 3, 1998; Page A01

    Taking up a dispute that could broadly affect lobbyists and the gifts they lavish on officials, the Supreme Court said yesterday it would review the case of a California company accused of giving sports tickets, meals and other gifts to then-Agriculture Secretary Mike Espy.

    At issue is a criminal statute that bars illegal gratuities and dictates the circumstances under which individuals or companies can give gifts to members of Congress, Cabinet officers and other government officials in a position to influence national policy. The law makes it a crime to give a gift to any public official "for or because of any official act" rendered. In looking at how close the link has to be between the gifts given and any official actions taken, many courts have ruled that simply giving a gift to an official in a position to make decisions affecting the giver is enough to constitute a crime.

    But the D.C. Circuit Court of Appeals, in a decision last March overturning a conviction against Sun-Diamond Growers of California, set a higher standard: It ruled that there must have been some official act that the gift-giver benefited from, or hoped to benefit from, in order for a law to have been broken. In other words, the appeals court found, prosecutors have to show that "the gifts were motivated by more than merely the giver's desire to ingratiate himself with the official generally."

    Wherever the Supreme Court draws the line between illegal and legal gratuities, its decision is likely to affect a large swath of political business inside the Capital Beltway, where lobbyists use a variety of methods, including gifts, to win general goodwill and keep lines of communication open.

    In his appeal to the high court, independent counsel Donald C. Smaltz said the D.C. Circuit ruling "seriously undermines the enforcement of an important federal criminal statute designed to promote government integrity." But the lawyer for Sun-Diamond, one of the nation's largest food cooperatives, said the statute plainly requires prosecutors to show a nexus between the gifts and an official's actions affecting a company.

    Espy himself is on trial in the District, charged with accepting illegal gratuities for himself, his former girlfriend and his relatives, and with violating the Meat Inspection Act of 1907, which bars Agriculture Department employees from taking anything of value from companies they are charged with regulating. Both his case and the earlier jury conviction against Sun-Diamond arise from Smaltz's four-year investigation of the former agriculture secretary, who was forced from office in 1994 amid allegations of corruption.

    In the Sun-Diamond case, Smaltz alleged that company lobbyist Richard Douglas gave Espy about $5,900 in unlawful gratuities, including tickets to the U.S. Open tennis tournament, luggage, meals, a framed print and a crystal bowl. The indictment alleged that Sun-Diamond reimbursed Douglas for the costs and treated them as business expenses.

    Smaltz argued that those gifts violated the gratuity law, which states that anyone who "gives, offers, or promises anything of value to any public official . . . for or because of any official act performed or to be performed by such public official . . . shall be fined" or imprisoned for up to two years.

    The trial judge told jurors they could find Sun-Diamond guilty even if there was no direct evidence that Espy performed any specific act that helped the company. And in 1996, a jury found Sun-Diamond guilty of breaking that law.

    But the company appealed that decision and won. In its ruling, the D.C. Circuit said the judge's instruction to the jury was too broad; the appeals court said the statute requires that "the giver must intend either to reward some past concrete official act or acts, or to enhance the likelihood of some future act of acts."

    The D.C. Circuit said if Sun-Diamond "furnished Espy with gifts merely to win his generalized sympathy for Sun-Diamond, those gifts would not be illegal gratuities."

    Smaltz, in asking the Supreme Court to hear the case, told the justices that the D.C. Circuit court's view conflicts with the prevailing interpretation in other appeals courts, and said if the ruling stands it could substantially jeopardize the ability of prosecutors to punish illegal gift-giving.

    But Richard A. Hibey, Sun-Diamond's lawyer, countered that a plain reading of law requires proof of a link between a company's gift and an official's actions affecting the company. He contends that courts that have allowed convictions when a gift was motivated merely by the recipient's official position have "legislated policy" that should be the domain of Congress.

    The justices will hear oral arguments in the case of United States v. Sun-Diamond Growers early next year and a ruling is likely by next summer. Smaltz's case against Espy would not be affected by the Supreme Court's decision, lawyers say, because the lower court's standard was in place at the time of his trial and double jeopardy principles would bar a retrial if Espy is acquitted.

    In other Supreme Court business, the justices agreed:

    To decide when employers could be forced to pay punitive damages in sex discrimination cases. The justices took an appeal of a D.C. Circuit ruling that said punitive damages can be awarded only in the worst cases. Other courts have allowed a lesser standard. Civil rights groups representing women and Hispanics urged the court to take the case and reverse the D.C. Circuit standard. (Kolstad v. American Dental Association.)

    Agreed to decide whether federal workers are entitled to have a union representative's help when they are questioned by an agency inspector general. A lower court said that because the Inspector General's office does not represent the agency's management, a union official need not be at an interview that may result in disciplinary action. (National Aeronautics and Space Administration v. Office of the Inspector General.)

    Rejected an appeal by workers at the top-secret Air Force base in Nevada, known as Area 51, who alleged they were exposed to harmful levels of hazardous waste. (Kasza vs. Browner.)

    Staff writer Bill Miller contributed to this report.

    © 1998 The Washington Post Company

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