SCOTUS uses TN case to clarify liability in white collar crime cases
A case out of Tennessee questions how much someone can be held liable for a crime committed primarily by another.
The Supreme Court of the United States (SCOTUS) recently heard a case questioning liability in white collar crime cases. The case delves into the federal forfeiture statute. This statute requires defendants forfeit proceeds obtained from a crime. But when does someone actually obtain those proceeds? The case questions whether or not the court can require a person accused of a crime to forfeit money he or she did not “obtain” but may have been aware of under the theory of joint and several liability.
What is the theory of joint and several liability? This legal term refers to the ability to hold two or more parties independently liable for the full extent of damages. When applied, the party that loses money can demand full payment from any one of the accused. This defendant can than attempt to gain payment from the others that are accused of wrongdoing.
What happened in this case? Honeycutt v. United States involves two brothers. One brother managed sales at an outdoor-gear retail store partially owned by the other brother. The store sold a water purification product cold “Polar Pure.” It is an outdated method to purify water that relies on iodine crystals. The Tennessee Methamphetamine Task Force told the brothers that the product was an ingredient in the production of methamphetamine. As such, they were encouraged to refrain from selling it to suspicious characters of they felt “uncomfortable.”
Instead of taking this advice, the brothers allegedly began selling the product in massive quantities. The government claims that they went from selling two bottles during one entire year to over $400,000 in sales from 2008 to 2010. This led to charges of conspiracy and other criminal charges related to distribution of chemicals with the knowledge of use to manufacture methamphetamine. The court found the brothers guilty of the charges. One brother was not done with his legal battle. He continued his fight, stating that he should not be fully financially liable for the crime under the theory of joint and several liability.
The brother that served as a store manager contends that he did not realize any profits for the sales. Since he did not get any of the profits, he argued that he should not be required to pay back the money gained by illicit activity. The lower courts disagreed and held both brothers liable under the theory of joint and several liability.
SCOTUS disagreed. The highest court in the country reviewed the case and unanimously agreed that joint and several liability should not apply. The forfeiture act governs the use of this theory of liability. SCOTUS explained the forfeiture act focuses specifically on those who acquire property from the crime. Based on this reasoning, this brother was not liable because he did not “obtain” any of the proceeds.
What can those charged with a crime learn from this case? This case provides a lesson for those charged with any crime in Tennessee. Whether facing charges for a white collar offense, drug offense, driving while intoxicated or other criminal charge it is important to seek legal counsel. An experienced attorney can help build a defense to touch on all portions of the charges, including exactly how much the accused is held liable.