That language, commonly known as the honest-services statute, has been wielded broadly by federal prosecutors in corruption cases.
In a case involving former Enron CEO Jeffrey Skilling, the Supreme Court on June 24 significantly limited the scope of the law to bribery and kickback schemes, finding that construing it to reach other conduct would be unconstitutionally vague. A week later the court vacated a ruling against Scrushy, ordering a new hearing of his appeal.
In a new brief filed today, Urciuoli’s attorneys argue that it’s not enough for prosecutors to label the alleged scheme as bribery. The filing argues that it’s legal under Rhode Island law for part-time legislators to have other jobs. Urciuoli, while at the helm of Roger Williams, hired then-state Sen. John Celona as a consultant, and prosecutors alleged the job was a sham intended to disguise payments to Celona for using his official position to do the hospital’s bidding.
The brief also argues that the Enron case limits honest-services fraud to defendants who personally hold a fiduciary duty to someone harmed, such as the residents of Rhode Island, or in the case of Skilling, investors.
The U.S. attorney’s office in Providence anticipated the arguments in a document filed in late June. They write that the Urciuoli prosecution relied on a quid pro quo bribery theory, and they dispute the interpretation of the Enron case as to who can be held liable: “The law plainly covers the person who corrupted the official.”
Urciuoli was sentenced to three years in prison but remains free pending the outcome of his appeal.