The thrust of Justice Elena Kagan’s unanimous decision in Kelly v. United States — a case involving the New Jersey “Bridgegate” scandal — is that “not every corrupt act by state or local officials is a federal crime.”
The Supreme Court tossed out the convictions of two political appointees of former New Jersey Gov. Chris Christie, who had been convicted of violating a federal wire fraud statute in the Bridgegate scandal — a corrupt effort to punish a mayor who refused to endorse Christie’s reelection bid.
Christie, a Republican, hoped to secure the endorsements of several Democratic mayors in his state, including Mayor Mark Sokolich of Fort Lee, in 2013’s election. After Sokolich informed Christie’s office that the governor would not receive the mayor’s endorsement, several of Christie’s appointees executed a scheme to punish Sokolich by halting traffic in Fort Lee.
The George Washington Bridge, which spans the gap between Fort Lee and Manhattan, typically has three dedicated lanes that serve local traffic from Fort Lee. After Sokolich refused to endorse Christie, Christie’s subordinates reallocated two of these lanes to general traffic. The result was a traffic jam so severe that it completely gridlocked the town.
As Kagan explains, “School buses stood in place for hours. An ambulance struggled to reach the victim of a heart attack; police had trouble responding to a report of a missing child.”
No one, including the defense attorneys in this case, denies that Kelly involves an “abuse of power.” But the Supreme Court nonetheless reversed the convictions of the Christie appointees behind this traffic scheme.
The reason for this decision turns on a technical distinction in a federal anti-corruption law. But it also stems from a long line of Supreme Court decisions reading a different anti-corruption law very narrowly. Kelly is the culmination of a series of Court decisions that have opened up a massive hole in America’s anti-corruption laws.
The case turns on a very technical dispute about “property”
The two defendants in Kelly are William Baroni, who Christie appointed as deputy executive director of the Port Authority of New York and New Jersey, and Bridget Anne Kelly, who served as Christie’s deputy chief of staff. Both were convicted of violating a federal wire fraud statute, which makes it a crime to execute “any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises.”
In McNally v. United States (1987), the Supreme Court determined that this somewhat cryptic statutory language only applies to “schemes to deprive [a victim] of their money or property.”
So that’s where the prosecution against Baroni and Kelly fails. Though the two former officials’ actions were undoubtedly corrupt, the purpose of their scheme was not to deprive anyone of money or property. As Kagan writes, Baroni and Kelly did not “walk away with the lanes [on the George Washington Bridge]; nor did they take the lanes from the Government by converting them to a non-public use.”
What they did was reallocate two lanes from drivers originating from the town of Fort Lee to the general populace. Under the Court’s decisions, Kagan concluded, “that run-of-the-mine exercise of regulatory power cannot count as the taking of property.”
Fair enough. Kagan is correct that “not every corrupt act by state or local officials is a federal crime,” and Kelly is hardly the first time that someone who committed an immoral act escaped criminal charges because there was no federal statute forbidding the specific thing that they did.
Yet, as Kagan’s opinion also notes, Congress attempted to fill in this hole in America’s anti-corruption law, but the Supreme Court blocked that effort.
The Supreme Court has drastically shrunk a law targeting government corruption
As Kagan writes, shortly after the Supreme Court decided McNally, “Congress responded to that decision by enacting a law barring fraudulent schemes ‘to deprive another of the intangible right of honest services’—regardless of whether the scheme sought to divest the victim of any property.” But the Court determined that “honest services” law was too vague, and it adopted “‘a limiting construction,’ confining the statute to schemes involving bribes or kickbacks.”
Indeed, the Court narrowed this honest services law to such an extent that many forms of bribery are now effectively legal. Consider McDonnell v. United States (2016), which dealt with former Virginia Republican Gov. Bob McDonnell’s conviction for honest services fraud.
The facts of McDonnell are fairly astonishing. McDonnell was friends with Jonnie Williams, who ran a company selling a nutritional supplement derived from tobacco. Williams wanted one of Virginia’s public universities to conduct a study on this supplement, which Williams could potentially use to gain FDA approval of the supplement for use in an anti-inflammatory drug.
Williams also lavished gifts on McDonnell and his wife, including a Rolex watch for the governor and $20,000 in designer clothing for the governor’s wife. In total, the McDonnells received over $175,000 in loans and gifts from Williams.
Gov. McDonnell, meanwhile, did a number of favors for Williams, including introducing Williams to the state’s health secretary, and hosting a lunch event for Williams’s company at the governor’s mansion — an event attended by several university researchers.
Nevertheless, the Supreme Court held that these favors were not enough to render McDonnell’s actions criminal. To sustain a conviction, the Supreme Court concluded, McDonnell would have had to make a policy decision in return for a bribe — or, at least, McDonnell would have needed to have pressured a subordinate into making such a decision.
It wasn’t enough that McDonnell introduced Williams to key state employees who could have benefited Williams’s company.
Kelly, meanwhile, is the mirror image of McDonnell. In McDonnell, there were no shortage of corrupt payments from Williams to McDonnell, but McDonnell’s actions were nonetheless legal because he did not perform an “official act” that benefited Williams.
In Kelly, by contrast, Christie’s subordinates did perform an official act that impacted thousands of people in Fort Lee. But there is no evidence that they were bribed to do so. They appear to have committed this act largely to spite a mayor who did not give Christie something that he wanted.
Read together, the cases suggest that state officials have a fair amount of leeway to commit corrupt acts, so long as they don’t accept some sort of bribe and make a policy decision that benefits the person who paid them a bribe.
Kelly could open the door to widespread corruption
In the wake of Kelly, McDonnell, and similar cases, federal anti-corruption law now has a considerable blind spot. An official may not change policy to benefit someone who pays them a bribe. And they may not use their office to corruptly obtain property for their own use. But there is no federal ban on using their power in office to punish political opponents, or potentially to reward political supporters.
Imagine, for example, if the Trump administration were to make it easy for companies to obtain permits if their CEO endorses President Trump, while simultaneously denying permits to companies whose CEO endorsed Democratic presidential candidate and former Vice President Joe Biden. Or imagine that Trump simply dislikes a particular company, so he pressured the Justice Department to file a suit against that company.
Such actions could trigger a civil lawsuit — treating different companies differently because of the political views of their CEOs would violate the First Amendment. But it now appears unlikely that government officials could face criminal charges for engaging in such a scheme.
And that means that those officials are more likely to engage in such schemes.