Kasowitz Client Prevails on U.S. Supreme Court Appeal on Important Constitutional Question

Kasowitz Client Prevails on U.S. Supreme Court Appeal on Important Constitutional Question

In an important decision affecting criminal prosecutions of corporations, among others, the U.S. Supreme Court in United States v. Southern Union, on June 21, 2012, granted the appeal of Kasowitz client, Southern Union Company, holding that the Fifth and Sixth Amendments to the U.S. Constitution require that a jury, not a judge, find beyond a reasonable doubt any fact that increases a criminal fine beyond a prescribed statutory maximum.  Here, a Rhode Island federal judge had imposed a fine of $18 million on Southern Union following its conviction by a jury on one of three counts of violating the Resource Conservation and Recovery Act, even though the violation carried a maximum fine of only $50,000 per day of violation, and the Government never requested, and the jury never made, a finding of the length of the alleged violation.

Southern Union appealed on the ground that the fine was unconstitutional under the Supreme Court’s decision in Apprendi v. New Jersey, 530 U.S. 466 (2000), which held that “any fact that increases the penalty for a crime beyond the prescribed statutory maximum must be found by a jury beyond a reasonable doubt,” not by a judge.  Southern Union argued that because the jury made no finding as to the duration of the violation, the most it could be fined was one day’s violation or $50,000.  The First Circuit Court of Appeals affirmed the fine on the ground that Apprendi applies only to incarceration, not fines.

In reversing and remanding for resentencing, the Supreme Court ruled that Apprendi does apply to criminal fines, and that the judge’s imposition of a fine for greater than one day’s violation was unconstitutional.  Southern Union was represented by Kasowitz and Sidley Austin LLP.  Kasowitz partners Daniel R. Benson, David E. Ross, Eric D. Herschmann and Seth B. Davis worked on the briefs.