The common wisdom in appellate work is to avoid the “kitchen sink” approach. Narrow your issues to the strong ones, so the court can focus on them and not be distracted by less persuasive ones.
The problem with that approach in a criminal case is that waiver is the dog that is always ready to bite you.
(Got all those analogies?)
Judge Jed Rakoff (featured in another post of mine here), denied former Goldman Sach’s director Rajat Gupta’s section 2255 petition. Mr. Gupta had argued that the Second Circuit’s decision in United States v. Newman required that his conviction be vacated and that he be released.
Judge Rakoff begged to differ.
Mr. Gupta is currently serving a two year prison term. He was convicted of insider trading for his dealings with hedge fund executive Raj Rajaratnam.
I’m not going to get into the details of habeas petitions (in part because they are not an area of specialty for me, by any stretch of the imaginations. Suffice to say, the statute governing these petitions is strict and courts’ interpretations of habeas limitations can be draconian.
The courts do not want section 2255 petitions to become another appeal. So, they are reserved for very limited circumstances.
Mr. Gupta argued that the instruction to the jury about “personal benefit” was incorrect under the new ruling.
He raised this issue at trial. Repeatedly.
He abandoned it on appeal.
As Scooby would say, “ruh-roh, Shaggy.”
If you do not raise a legal issue on direct appeal, then you cannot raise it in a habeas petition unless you (1) show cause for failing to raise it and prejudice; or (2) actual innocence.
The “cause” element usually requires a showing that raising the issue would have been futile.
As Judge Rakoff points out
Here, Gupta’s own actions belie any claim that the argument he now raises would have been “futile.” At trial, he objected to the Court’s description of the benefit element in both the preliminary jury charge and the final instructions. . . and he also objected to the Government’s characterization of the element during its closing argument. That he later decided to leave this argument on the cutting room floor to narrow the issues on appeal does not establish that it was futile.
The court also rejected his argument that Newman means that he is “actually innocent” because he–as the “tipper”–did not receive any quid pro quo from Mr. Rajaratnam in the form of “a potential gain of a pecuniary or similarly valuable nature” (quote from Newman, 773 F.3d at 452).
Judge Rakoff concluded that Mr. Gupta “misreads Newman.” It deals with the “remote tipper” while Mr. Gupta was the direct tipper. Plus, the jury was instructed consistent with Newman that a tipper is liable if he takes sensitive market information and exploits it for personal benefit.
Plus, concludes the court, even if Mr. Gupta’s reading is correct,
such a [personal] benefit was also clearly present, as demonstrated by prior exchanges [between Mr. Gupta and Mr. Rajaratnam]
Abandoning this argument on appeal ultimately hurt Mr. Gupta.
But if his counsel didn’t believe it had much merit, given the then-existing Second Circuit precedent, was it really wrong not to include it?
These situations always make me wonder whether a footnote or two summarizing and attempting to preserve all legal arguments made during trial is necessary in an appellate brief. Should we include a footnote with the barest description of these legal arguments, simply to preserve them “just in case”?
Or would a court conclude that a footnote doesn’t preserve anything?