US Supreme Court: Criminal fines must be decided by a jury

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Like other factors that increase a criminal defendant’s sentence, facts that determine the amount of criminal fines imposed on a defendant must be decided beyond a reasonable doubt by a jury, the U.S. Supreme Court ruled at the end of the term in a 6-3 decision.

In Southern Union Co. v. U.S., the Court reversed a 1st Circuit ruling that said a judge could impose criminal fines totaling $18 million against a company after a jury convicted it of environmental violations under a statute that tied the amount of fines to the number of days of violation.

The Supreme Court said that, just as in criminal sentencing involving imprisonment or death, its 2000 ruling in Apprendi v. New Jersey (530 U.S. 466) applies to criminal fines as well.

In Apprendi, the Court held that any fact that increases a defendant’s maximum potential sentence, other than a prior conviction, requires a jury finding under the Sixth Amendment right to jury trial.

“[W]e see no principled basis under Apprendi for treating criminal fines differently. Apprendi’s ‘core concern’ is to reserve to the jury ‘the determination of facts that warrant punishment for a specific statutory offense.’ That concern applies whether the sentence is a criminal fine or imprisonment or death,” Justice Sonia Sotomayor wrote for the majority in Southern Union.

Criminal defense attorneys welcomed the ruling, which they said would apply broadly to many different types of criminal fines.

“It’s a logical extension of Apprendi,” said James P. Howe, a criminal defense attorney in Wakefield, R.I. “They have covered the playing field [in applying Apprendi], from the death penalty to incarceration to consecutive sentencing and now criminal fines.”

Stored liquid mercury

In 2007, prosecutors indicted Texas-based natural energy company Southern Union Co. for illegally storing 140 pounds of liquid mercury in Pawtucket, R.I. Youths in a nearby apartment building got access to it, played with the hazardous substance and spread it around the complex.

The government charged the company with multiple counts of violating federal environmental laws, including knowingly storing liquid mercury without a permit from “on or about September 19, 2002 until on or about October 19, 2004” in violation of the Resource Conservation and Recovery Act.

A jury found the company guilty of that count.

Under the Act, criminal fines of up to $50,000 are imposed for each day of violation.

At sentencing, the probation officer set a maximum criminal fine of $38.1 million based on the 762-day period between September 2002 and October 2004.

The trial judge imposed a $6 million fine and $12 million in “community service” obligations.

The company objected, arguing that the jury was never asked and never found the exact number of days of violation and was told it must convict only on a single-day violation.

On appeal, 1st Circuit upheld the fines, saying that Apprendi doesn’t apply to criminal fines; other circuits had gone the other way.

In oral arguments before the Supreme Court, the company argued that the most that could be concluded from the verdict was a violation of one day, amounting to a $50,000 penalty, and the judge dramatically increased the sentence without findings by a jury.

The government argued that the judge carried out a common duty in deciding the amount of a fine – a role historically never in the hands of the jury.

But the Supreme Court was not convinced.

“Under Apprendi, other than the fact of a prior conviction, any fact that increases the penalty for a crime beyond the prescribed statutory maximum must be submitted to a jury and proved beyond a reasonable doubt. The statutory maximum for Apprendi purposes is the maximum sentence a judge may impose solely on the basis of the facts reflected in the jury verdict or admitted by the defendant. Thus, while judges may exercise discretion in sentencing, they may not ‘inflict punishment that the jury’s verdict alone does not allow,’” the Court said.

The justices compared criminal fines to a prison sentence or capital punishment.

“Criminal fines, like these other forms of punishment, are penalties inflicted by the sovereign for the commission of offenses. Fines were by far the most common form of noncapital punishment in colonial America. They are frequently imposed today, especially upon organizational defendants who cannot be imprisoned. And the amount of the fine, like the maximum term of imprisonment or eligibility for the death penalty, is often calculated by reference to particular facts. … In all such cases, requiring juries to find beyond a reasonable doubt facts that determine the fine’s maximum amount is necessary to implement Apprendi’s ‘animating principle’: the ‘preservation of the jury’s historic role as a bulwark between the state and the accused at the trial for an alleged offense. In stating Apprendi’s rule, we have never distinguished one form of punishment from another,’” the Court said.

Three dissenting Justices criticized the majority for expanding Apprendi to findings of fact that are not elements of a crime.

Justice Stephen G. Breyer, whose dissent was joined by Justices Anthony M. Kennedy and Samuel A. Alito Jr., predicted that the ruling would “lead to increased problems of unfairness in our criminal justice system” because Congress expected judges, not juries, to impose criminal fines when it enacted such statutes.

‘Game has changed’

The ruling is expected to impact a host of statutes that involve criminal monetary penalties, including laws that cover regulatory compliance, Medicare fraud and foreign corrupt practices.

“You’ll see a much different indictment. … The jury is now going to have to find each occurrence by evidence beyond a reasonable doubt,” said James E. Smith, a criminal defense attorney in Providence, R.I.

“The game has changed,” said law professor Harold J. Krent, who filed an amicus brief on behalf of the Criminal Procedure Scholars, an organization of criminal procedure law professors. “It will certainly make prosecutors more careful about charging and proving criminal fines.”

Krent said he was primarily concerned that prosecutors were able to charge as aggressively as possible without having to prove all the facts upon a plea bargain or at trial.

“There was a lack of rigor, because if prosecutors knew if they could just find liability then they could try to get as large a fine or forfeiture as possible,” said Krent, dean of IIT Chicago-Kent College of Law in Chicago, Ill.

He added that the new rules could result in “more reasonable plea bargaining offers than before because of the greater difficulty of proof at trial” for prosecutors.

The ruling will apply to any statutes that impose criminal fines based on certain findings of facts, such as the duration of a violation, number of occurrences or amount of loss to a victim.

Statutes that give a judge total discretion in the range of a criminal fine do not trigger fact-finding by a jury.

The Court did allow for an exception in cases of “petty” or “insubstantial” criminal fines.

“Where a fine is so insubstantial that the underlying offense is considered ‘petty,’ the Sixth Amendment right of jury trial is not triggered and no Apprendi issue arises,” the Court said.

This leaves open the definition of “what is and is not petty,” said Howe.

“The Court said a $10,000 fine imposed on a labor union does not make it entitled to a jury trial, but if it’s a $10,000 fine against a private citizen, would that implicate Apprendi? I don’t know,” Howe said.

“The Court did leave an out for a fine that is insignificant, but we don’t know what that means,” Krent said. “It will be elaborated in other cases. There are going to be line-drawing problems and you can see the slippery slope of it, but the Court didn’t present an easy way to draw the line.”