SCOTUS Could Narrow Bribery Law & Military in DC and LA

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1:33This is Bloomberg Law with June Grosso from Bloomberg Radio. This is what happens when people have the best interests of our state in mind and work in good faith to come to a resolution. Michael Madigan was an almost mythical figure in Illinois politics. His three-decade reign earned him the nickname the Velvet Hammer because of the way he maintained power over decades of leading the state house and enforcing fealty from its members. But today, Madigan stands convicted of bribery, conspiracy and fraud after a four-month trial where he was accused of running a years-long criminal enterprise to enrich himself and his political allies.

2:21Prosecutors built their four-month case on witnesses who turned state's evidence and wore wires, emails and documents, and wiretapped conversations like these. If you can, get in your mind that your client is only Mike Madigan. I generally never refer to the speaker. I just say our friend. So if you just say our friend, no one really knows what we're talking about. Speaker's office. Hey, Micah. Hey. Will you tell the Speaker I took care of Darius and Peñatovich, did you just throw away that note? The trial may be over and Madigan's seven-and-a-half-year sentence handed down, but it's just the beginning of an appellate process that could have real consequences for corruption cases.

3:08Joining me is former federal prosecutor Mark Chutko, a partner at Dykema Gossett. Mark, for those who aren't familiar with Illinois politics, tell us a little about Madigan. Michael Madigan was the longtime Speaker of the House, a Democrat in the state of Illinois, actually the longest serving state speaker in the history of the United States, having served for 36 years. He resigned office in approximately 2021 because of scrutiny by the federal government in connection with corruption allegations. And a four-month trial ended in a split verdict. Tell us about the trial and the verdict. Well, in the trial itself, the jury threw out the racketeering conspiracy charges, also had some difficulty on some of the other bribery counts, but ultimately ended up convicting of 10 counts, including some of the bribery counts.

4:03He has to report to prison on October 13th. I'm curious as to why the judge didn't allow him to remain out of prison pending appeal. He filed a motion for release pending appeal, which are generally disfavored in cases like this. He would have had to have shown that there were substantial questions of law or fact that would have resulted in a reversal or a new trial for the charges for which he was sentenced to prison. The judge on Friday issued a 44-page order denying that motion, indicating that, at least in the judge's mind, there was no question but that he had committed these crimes, the evidence was there, and at least the judge was somewhat dismissive over some of his legal challenges.

4:49So one of his likely arguments on appeal, which was previewed in the motion, centers on the definition of corruptly in the federal bribery statute. Will you explain this debate over that word corruptly? Yeah, the statute itself, Title 18, Section 666, which is a federal theft and bribery statute, specifically uses the term corruptly in connection with obtaining something of value in exchange for an official act or being influenced in connection with an official duty. And the term has never been ruled upon by the Supreme Court, although in a recent case last year involving a Portage, Indiana, mayor named James Snyder, there was healthy debate within the oral argument about what the term corruptly means.

5:40And generally, the Supreme Court is wary of vague terms, especially in the criminal law. And there has been a trend recently towards them ratcheting back on the scope of the prosecutors and the government use of corruption statutes. And so that seems to be the highlight here of what Madigan and perhaps the other ComEd for defendants are going to argue that corruptly is a vague, unconstitutionally vague term that doesn't give fair notice to a defendant, to a public official of where the right line is. The Supreme Court, as you mentioned, has been cutting back on the reach of federal corruption laws and prosecutorial discretion to bring charges against government officials in a string of cases in the last decade.

6:27Can you sort of trace that out for us? Yeah, it really started, especially over the last decade, in the U.S. v. McDonald case involving a Virginia Governor McDonald, who was convicted of various bribery charges, which were overturned at the Supreme Court based on what the definition of an official act is. In that case, the Virginia Governor was lending his public space, the Governor's mansion, to a backer of his who had been providing him items of value both to him and his wife. This was a nutritional supplement company. And the governor was making access so that this nutritional supplement company could have meetings with officials at the University of Virginia hoping to get contracts.

7:14And while the court said that that might be in some ways an abuse of power, it was not an official act. It wasn't a core duty of the governor to provide this sort of service. And so that case was struck down. Following that in 2020, in what has been known as the Bridgegate case, Kelly versus the United States, the Supreme Court again overturned convictions of two former New Jersey public officials that had admittedly abused their power by realigning toll lanes as political retribution. But the court there said that did not fit under the mail wire fraud statute because there had been no money or property that had been obtained in connection with that case.

7:58Then, Just a couple of years ago, in a couple of cases, the Supreme Court, in a case called Prococo and another one called Simonelli, also narrowed the scope of the term intangible right of honest services as unconstitutionally vague. And in a bid rigging case, scaled back the understanding that the government had been using a bid rigging cases to say that withholding information from a competitor is not a traditional property interest under wire fraud. Finally, this culminated last year in 2024 in the case I alluded to before involving this Portage, Indiana, Mayor James Snyder, where the court said that under the 666 bribery statute, you cannot criminalize after the fact gratuities or rewards to a public official for positive actions on behalf of a developer.

8:47Of the decade of Supreme Court decisions in these public corruption cases, I found that Snyder decision stunning because it seemed like a textbook example of kickbacks. He got the$13 ,000 after a trucking company was awarded city contracts. Yeah, I mean, it certainly is what we call in the criminal parlance slime, but was it crime? The court looked at the statute itself and compared the 666 bribery statute with comparable federal statutes when federal officials engage in bribery and corruption and said that it simply did not match the gratuity statute, which criminalizes after the fact rewards.

9:30And what the court was looking for was a traditional in advance understanding by both parties that there was going to be a quid pro quo of this for that transaction of income value for official acts. Court said a contrary ruling had the potential to criminalize commonplace gratuities like a Dunkin' Donuts gift card, a Chipotle dinner, or tickets to a Hoosiers game. And that was a six to three decision down ideological lines. Justice Ketanji Brown-Jackson wrote for the liberals and said, Snyder's absurd and a textual reading of the statute is one only today's court could love. Do you have any inkling as to why the Supreme Court has been cutting back on these public corruption prosecutions?

10:20Some of it may have to do with federalism concerns that the court does not want to see the federal government micromanaging how state and local officials conduct their campaigns or interact with the public. Some of it has to do with fair notice. The government has been very aggressive or had been very aggressive 10, 15 years ago in asserting an intangible right to honest services and other sorts of theories to basically try to look at criminal or corruption activity within the state and local level. And at some point, the court thought that was overstretched, that it was giving too much discretion to prosecutors to import their own principles as to what good governance means.

11:03And Madigan has hired as his appellate lawyers a team that includes the lawyers who successfully argued that Snyder case, indicating that he may be aiming for the Supreme Court. Yeah, that's right. Lisa Blatt and another woman by the name of Amy Saharia, who successfully argued in the Supreme Court last year that Snyder, his conviction should be overturned. Coming up next on the Bloomberg Law Show, I'll continue this conversation with former federal prosecutor Mark Chutko. We'll talk about possible issues for Madigan's appeal and how difficult it is for prosecutors to bring public corruption cases these days.

11:42I'm June Grosso, and you're listening to Bloomberg. This is the Bloomberg Tech Minute brought to you by ChatGPT. Now with ChatGPT Work, I'm Carol Masser. DoorDash, the largest food delivery company in the U.S., is building its own delivery drones and has gained the necessary FAA approvals to operate them commercially, the latest in its effort to delegate more orders to robots as a way of cutting delivery times. Bloomberg's Natalie Lung reports the company says it has been conducting pilot programs with various restaurants, some of which have seen their order volume grow during the test period.

12:19The effort marks an expansion of DoorDash's in-house robotics efforts to reduce reliance on human couriers for some orders, as their wages constitute a key expense to the business. Drones are also a way for DoorDash to cut delivery times on orders from more remote locations that some dashers may not want. That's the Bloomberg Tech Minute, brought to you by ChatGPT. Put ChatGPT to work on your most ambitious ideas and projects. Get started at ChachiPT.com today by selecting Work Mode. Available on Plus and Pro Plans. Everyone's talking about how AI is transforming work, especially in sales. While the landscape shifts, one thing remains the same.

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13:30Every sale comes down to a single second. The one between buy now and maybe later. PayPal is built to help your business win that moment. with a checkout experience that feels certain, reliable, and familiar. With a global two-sided network and hundreds of millions of buyers who already know us. All to keep you in control however buying happens next. New markets, new AI-powered selling services. A whole new agentic era where you decide how your business will show up and stand up. PayPal is built to help your business come out ahead. We're built for payments, built for growth, built for Agendic.

14:15PayPal Open, built for all business. Visit PayPalOpen.com to get started. That's PayPalOpen.com. I've been talking to former federal prosecutor Mark Chutko about the Michael Madigan corruption case, which may offer the Supreme Court a chance to redefine bribery law again. Madigan's appellate brief hasn't been filed yet, but that motion, which was unsuccessful to stay out of custody pending appeal, offers a preview of some of the likely arguments. And as far as that word corruptly, are they just saying that there should have been a different jury instruction? They're saying that it just simply was vague.

15:01I mean, as the instruction looks right now in the Madigan case, corruptly simply means that a defendant acts with the understanding that something of value is to be offered or given to reward or influence someone in connection with their official duties. And so there was no specific definition of corruptly, although I must say that in the Snyder oral argument, it was debated quite a bit. In fact, the government in Snyder and oral argument suggested that corruptly might mean wrongful or consciousness of wrongdoing. They also alluded to an Arthur Anderson Supreme Court case where corruptly had been defined as immoral or inherently wrongful.

15:40Some of the justices push back on that as not really guidance at all, that there are no real clear rules to guide public sector officials, that that's what you're going to be looking at. And so in this case, what Madigan has seized upon is that corruptly must mean something. And he is concluding that it means consciousness of wrongdoing, sort of alluding to what the government itself argued in Snyder. And that almost imports what we call a specific intent requirement that the public official not only knows the facts that they did, but also knows that those facts, the actions that they took were wrongful, were illegal under the law.

16:17I mean, the trial included 11 weeks of testimony. The jury heard from more than 60 witnesses, including Madigan. Was there enough evidence there for Madigan to be convicted, even using a jury instruction that requires specific intent? Well, you know, it's interesting because Judge Blakey actually said that. He said that in this case, bribery itself, especially bribery, has now been defined by Snyder as in advance agreement between a public official and a private party is inherently wrongful. And so almost suggesting that everybody knows that this is illegal to do. And so you don't have to have that specific intent requirement.

16:59The court also alluded to the fact that Madigan himself was trained as a lawyer, which kind of gave him also notice that this was wrong, what he was doing. So does it seem like the Supreme Court is poised to take another step in a case like Madigan's? Madigan's? According to Judge Blakey, no. He suggests that the law is clear in the Seventh Circuit on this issue. But clearly, Madigan is looking beyond the Seventh Circuit by hiring people that have advocated before the Supreme Court and successfully. So I would expect that their eyes are set on the Supreme Court and that they think this is a further avenue to try to narrow the scope of what they would consider prosecutorial overreach.

17:41Let's just say that the Supreme Court reversed the bribery convictions. He was also convicted of conspiracy and wire fraud. Would those convictions hold and he'd still have to serve time? That is possible. And the court did allude to the fact that he was also convicted of a Travel Act violation, which has as a predicate act state-level bribery laws. And so even if Madigan was to succeed ultimately in overturning his bribery convictions. That isn't the end of the story. He may end up still with other convictions at the end of the day. And in the convictions of what are called the ComEd 4, the defendants who were convicted of bribery, conspiracy, and falsifying records in a scheme to illegally influence Madigan.

18:30An Illinois judge earlier this year throughout the bribery convictions there because of flawed jury instructions? That's right. That trial had occurred before the Snyder case. And so when the court looked back with the benefit of now understanding what the Supreme Court had said about bribery, was concerned that the instructions were flawed. And so removed all of those substantive bribery convictions, but let stand the conspiracy conviction. And that is a multi-object conspiracy, which involved both 666 bribery and these FCPA violations. And one possible avenue for appeal by the ComEd 4 is to suggest that because this was a general verdict, which did not specify which criminal object was proven under the conspiracy, that once the court threw out the bribery allegations that it's not clear what the jury decided.

19:29Did they decide that there had been a conspiracy based on the bribery or on the SCPA violation? So I would expect the comment for to attack the conspiracy conviction as well. And one of the defendants has hired Paul Clement, superstar conservative lawyer and Supreme Court litigator. Does a statement seem to indicate they're going to focus on the Trump administration's new stance on the FCPA? It's interesting. I heard stories to suggest that the defendants in the ComEd4 case actually had gone to the Justice Department to get them to reconsider these FCPA books and records violations based on recent guidance in which DOJ has been scaling back its use of the Foreign Corrupt Practices Act.

20:18Basically, they don't want to prosecute what are otherwise considered routine violations, and they're focused more on transnational organized crime and other sorts of national security interests. And so at least what some reporters have suggested is that there had been some outreach with the Justice Department, but they weren't successful. But I would assume by the hiring of Paul Clement that the comment for, or at least the former CEO, intend to try to pursue this all the way to the Supreme Court to suggest that the prosecutors here are also stretching the boundaries of the Foreign Corrupt Practices Act, which really was designed to attack and combat against bribery of foreign officials, not domestic concerns.

21:01And what the Justice Department has done in the ComEd4 case was to bring these books and records violations to basically address purely domestic companies that were involved in purely domestic alleged bribery. I would expect that Mr. Clement would say that really stretches beyond the intended purposes of the Foreign Corrupt Practices Act. Mark, you were the chief of the public corruption unit at the Detroit U.S. Attorney's Office. Can you describe how difficult it is now to bring these kinds of cases, what prosecutors have to consider before bringing a case? Yeah, public corruption cases are intensely difficult to bring.

21:42That traditionally has been the elite office in any U.S. attorney's office and consists of some of the stars of the office who have been there for a long time and know how to build a case. And the challenge of a corruption case is unlike, let's say, a drug transaction, where you know, for instance, that cocaine exchanging hands is illegal. In the case of public corruption, the thing that is being bargained for is an official act, which in and of itself is not illegal. And so you need to know more to understand why that transaction is illegal. And so you have to look at the intent of the parties.

22:16You've got to draw a lot of circumstantial evidence, either of consciousness of guilt because they're hiding the money or having a wiretap so you can actually hear the words of the two parties transacting in these things, maybe having an informant wearing a recording device. But because of the Supreme Court's ratcheting back of the corruption statutes, it is becoming increasingly difficult to try to prove these cases, especially with the use of consultants and other people that sort of insulate the public official from maybe the person that is paying the money. And so I think in the future, it's going to be harder and harder to bring these kind of cases.

22:55Added to that is the polarization of our country. I mean, And right now, both political parties are making counter accusations against each other of the weaponization of the Department of Justice, that somehow that the Department of Justice is misusing its investigative and prosecutorial functions. That seeps into a jury pool and it could have a spillover effect. In a criminal case, you've got to get 12 people that unanimously agree beyond a reasonable doubt that a crime has been committed. And can you get that today when there are a lot of skepticism about the motivations of the prosecutors? It remains to be seen.

23:32And also the Trump administration has been cutting back on the people in the public corruption units, right? At least in the Department of Justice in the public integrity section, there are fewer prosecutors, I'm told, there. I don't know that that's impacted the U.S. attorney's offices around the country, which really bring the bulk of the corruption cases. This is a really fascinating area. Thanks so much for joining me, Mark. That's former federal prosecutor Mark Chutko, a partner at Dykema Gossett. This is the Bloomberg Tech Minute brought to you by ChatGPT. Now with ChatGPT Work, I'm Carol Masser.

24:12DoorDash, the largest food delivery company in the U.S., is building its own delivery drones and has gained the necessary FAA approvals to operate them commercially, the latest in its effort to delegate more orders to robots as a way of cutting delivery times. Bloomberg's Natalie Lung reports the company says it has been conducting pilot programs with various restaurants, some of which have seen their order volume grow during the test period. The effort marks an expansion of DoorDash's in-house robotics efforts to reduce reliance on human couriers for some orders, as their wages constitute a key expense to the business.

24:47Drones are also a way for DoorDash to cut delivery times on orders from more remote locations that some dashers may not want. That's the Bloomberg Tech Minute, brought to you by ChatGPT. Put ChatGPT to work on your most ambitious ideas and projects. Get started at ChachiPT.com today by selecting Work Mode. Available on Plus and Pro Plans. Everyone's talking about how AI is transforming work, especially in sales. While the landscape shifts, one thing remains the same. The thrill of closing a deal. Whether it's a gong or a confetti machine, every team has its celebration rituals. Adio is designed for that moment.

25:26It's the agentic CRM that turns customer signals into actionable insights, helping you close deals faster with revenue agents and automations working around the clock. You'll have everything you need to scale your go-to market efforts. Elevate your wins with Adio. Start your free trial at adio.com slash iHeart.

25:48Every sale comes down to a single second. The one between buy now and maybe later. PayPal is built to help your business win that moment. with a checkout experience that feels certain, reliable, and familiar. With a global two-sided network and hundreds of millions of buyers who already know us. All to keep you in control however buying happens next. New markets, new AI-powered selling services. A whole new agentic era where you decide how your business will show up and stand up. PayPal is built to help your business come out ahead. We're built for payments, built for growth, built for Agendic.

26:33PayPal Open, built for all business. Visit PayPalOpen.com to get started. That's PayPalOpen.com. Already they're saying he's a dictator. The place is going to hell and we've got to stop it. So instead of saying he's a dictator, they should say we're going to join him and make Washington safe. President Trump says he'll indefinitely extend the federal government's takeover of the Washington, D.C. Police Department past the 30 days allotted by law, by proposing a law to Congress or, if necessary, by declaring an emergency. Trump also suggested that a D.C. crime bill would be a template for other cities.

27:18And we're going to do something, and that's going to serve as a beacon for New York, Chicago, Los Angeles, and other places all over the country. This whole, our whole country is going to be so different and so great. It's going to be clean and safe and beautiful. My guest is Joshua Kastenberg, a professor at the University of New Mexico Law School and a former judge in the U.S. Air Force. We keep saying unprecedented, but in an unprecedented move, Trump deployed nearly 5 ,000 National Guard troops and Marines to Los Angeles in June. He's deployed about 8 ,500 active duty troops to the southern border, and now he's deploying 800 National Guard troops to D.C.