Imposing Criminal Punishment by Introducing False Testimony

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Posted in: Criminal Law

Sholom Rubashkin first made national news in 2008 when federal immigration authorities conducted an Elliott Ness-style raid complete with Blackhawk helicopters and an army of federal officers on Iowa’s Agriprocessors, America’s largest kosher meat plant, where Rubashkin served as vice president. The criminal case against Rubashkin was marked with constantly changing factual allegations and charges. Rubashkin was eventually convicted not on immigration charges, not on drug charges, and not on child labor charges (all eventually dropped), but on bank fraud for overinflating the income of the company. Full disclosure: I filed an amicus brief supporting Mr. Rubashkin in 2011, on behalf of the National Association of Criminal Defense Lawyers.

Notwithstanding the prosecution’s constant reshaping of the case in pursuit of a conviction (perhaps to justify the over $5 million cost of just the immigration raid itself), the federal government finally persuaded a federal judge to sentence this unlikely alleged criminal (community leader, observant Jew, local community philanthropist, father of ten including a special needs child) to a 27-year prison term.

The case is back before the courts, this time because of recently uncovered and startling evidence that the prosecutors knowingly presented false testimony in their pursuit of conviction. On April 1, 2016, several former U.S. Attorneys General (including John Ashcroft, Ramsey Clark, Ed Meese, Michael Mukasey), former FBI Directors Louis Freeh and William Sessions, others such as former U.S. Attorney Rudolph Giuliani, and 35 former federal judges all signed a letter asking the U.S. Attorney in Iowa to reopen this case because of “shocking new evidence” that federal prosecutors “knowingly presented false and misleading testimony at the sentencing hearing regarding their own actions in contributing to the $27 million loss which served as the foundation for Mr. Rubashkin’s sentence, and withheld exculpatory evidence regarding the same actions.”

First, some background. Agriprocessors was the largest supplier of kosher meat across the United States until 2008, when the Rubashkins contacted U.S. Immigration and Customs Enforcement (ICE) and offered to cooperate with efforts to ferret out hiring undocumented workers. ICE responded with several hundred federal agents raiding Agriprocessors as if it were an illegal drug cartel. (In fact, ICE did erroneously accuse the Rubashkins of making methamphetamines at the plant under the noses of the USDA inspectors as a basis for the search warrant!)

During the raid, ICE arrested 389 illegal aliens and later charged Rubashkin with one single violation of immigration law. Sholom Rubashkin contested with these charges and the prosecutors later dropped those charges. The day after Rubashkin’s release on bail, federal prosecutors arrested him again. This time, they asserted he inflated the value of the business to secure a bank loan.

After the second arrest, federal prosecutors argued that Rubashkin should be denied bail in part because he is Jewish and therefore is at risk of fleeing to Israel, although he is not Israeli, and has neither asserted nor tried to assert Israeli citizenship. The government’s argument, which could apply to any American citizen who is Jewish, understandably, triggered complaints of anti-Semitism from major Jewish organizations. Concern about religious discrimination increased when we learned that one of the federal prosecutors involved in initiating the case had written an email describing the company as Jewish-owned and falsely suggesting that it employed “Eastern European Hasidic Jews who are smuggled from New York.”

At sentencing, prosecutors alleged that bank fraud caused a $27 million banking loss and argued the court should sentence him to life imprisonment; ultimately the judge sentenced him to 27 years because of this multi-million dollar loss.

The bank did lose $27 million because it was unable to recover the loan. However, Rubashkin did not cause this loss. The loan was a $35 million revolving line of credit, and Agriprocessors had an appraised value of $68 million, which is more than enough to cover the loss twice over. The problem was that the government forced a sale of Agriprocessors for only $8 million. That government-forced sale caused the loss.

The bankruptcy trustee declined to accept an offer of $40 million because he thought an auction would yield even more. That sale would also reduce the bank’s loss to zero. However, the business sold for only $8 million, resulting in a bank loss of $27 million. That is because the prosecutors successfully prevented Aaron Rubashkin from participating in the new business, and they kept this information from the judge. That loss led to the 27-year sentence—more than ten times what the Sentencing Guidelines called for if the loss had been zero. This is many times more what a St. Louis banker, Mark Turkcan received. He defrauded the very same bank out of $25 million. Yet, he only received a sentence of only one year and a day!

Extraordinarily and inexplicably, the prosecutors sat down with every potential buyer and threatened criminal forfeiture should they find out that anyone with the last name “Rubashkin” was involved in the business in any management or advisory role. This intimidation scared away the bidders from pursuing the deal, which greatly reduced the value of the business. Like any business, the value is not just in the inventory but the people who run it.  So far, nine bidders have signed affidavits affirming that federal “prosecutors intimidated” them.

Even the bank, the main victim of the case, wrote a letter on December 9, 2008, begging the government to stop threatening forfeiture because they were scaring away buyers and driving down the price. The prosecutors withheld this letter and did not provide it to the defense.

At sentencing, Paula Roby, a lawyer representing the Agriprocessors bankruptcy trustee, testified, under oath, that the prosecutors did not in fact prohibit Aaron Rubashkin from having a role in the business and the prosecutors did not affect any prospective bidders or the bankruptcy sale price with the threat of criminal forfeiture of Agriprocessors. Roby also insisted that suggestions to the contrary were “unreliable rumors.” The sentencing judge expressly relied on Roby’s false testimony.

Now, let us fast forward to the present. We know that Rubashkin has served more than 80 months in prison. We also know something else: Roby’s testimony is false, and—wait for the other shoe to drop—the prosecutors knew it.

Rubashkin’s lawyers recently obtained handwritten notes from a December 2008 meeting between prosecutors, Ms. Roby, the independent bankruptcy trustee, and other counsel for the independent trustee. The notes show that Roby’s testimony was false. Other counsel for the trustee (one of whom is a former Assistant U.S. Attorney) and the court appointed trustee, have authenticated these notes.

During that meeting, prosecutors told the trustee that the restriction on Aaron Rubashkin and other members of his family are “non-negotiable.” Prosecutors later repeated their forfeiture threats directly to prospective bidders. Yet, prosecutors allowed (and one could reasonable imagine, encouraged) Ms. Roby to testify falsely that the government imposed no restriction on Rubashkin.

In response to these new developments, the Government’s brief justifies its use of Roby’s testimony by carefully splitting hairs. Roby’s testimony is “out of context.” Or, “Roby may have gotten the time of the meeting with Soglowek wrong, or may have misunderstood the question,” but Rubashkin “failed to show any inconsistency was intentional.” Even if “Roby’s testimony was inaccurate or even intentionally false, there is no evidence the government was aware any testimony was materially false,” so it was under no “duty to provide some manner of correction.”

Rubashkin’s reply brief responds, “In light of the government’s admissions, there does not appear to be any real dispute that certain portions of Paula Roby’s testimony are false and misleading.”

In April of this year, four former Attorneys General of the United States, several federal judges, two former Directors of the FBI and many others—107 current and former law enforcement leaders in total—wrote the new United States Attorney for the Northern District of Iowa about these facts demanding justice be done.

The ball is now in the court of the Department of Justice. Bearing in mind what the U.S. Supreme Court advised over 80 years ago, while the prosecutor “may strike hard blows, he is not at liberty to strike foul ones.” Law enforcement must be beyond reproach. Prosecutorial integrity is a cornerstone of our justice system. We can only hope that the DOJ takes steps towards reinstating integrity as a matter of urgency.

Posted in: Criminal Law, Law Practice

Tags: Legal

  • Paul R. Jones

    Makes sense to me. One U.S. Supreme Court Justice note that justice should not turn on the amount of money the defendant has or words to that affect. When the Judicial System become corrupt via the law enforcement corruption, little people have no hope or place to turn.

  • Stephan

    Well written! Couldn’t agree more