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Sunday 24 May 2009

Black wins his fight to have Supreme Court hear appeal 

The media mogul's case will force a clarification of the US right to 'honest services', says Ruth Dudley Edwards

There was cheery news last week on two legal fronts for Conrad Black. Just to remind you, Black is in his second year of a six-year sentence, having been convicted -- largely on a technicality -- of defrauding his company of $6m.

I began covering the case at long distance, believing he was guilty, and concluded early on he was a victim of serious injustice. We became occasional email friends when I asked him, on behalf of Sunday Independent readers, why he was so keen on Cardinal Newman.

An unintended consequence of the prosecution was the ruin of Black's successful company and the impoverishment of its shareholders: Hollinger shares fell from $18 under Black, to two cents in 2008.

In jail, Black keeps a low profile, but he maintains a high profile in the outside world through columns and blogs about history, politics and economics. He took his incarceration like the stoic that he is, but no one could accuse him of doing so lying down. "I am fine, thanks, and fighting on heartily," he said in a recent email.

He is winning some of the fights, at last. First, the US Supreme Court announced it would hear an appeal by him and two of his former colleagues at Hollinger International Inc against their convictions for defrauding the newspaper industry. Then an Ontario Superior Court Justice awarded him $90,000 in legal costs in ongoing libel actions against former directors and advisors.

Mind you, he now has to fight in a Chicago court to get more legal fees from his old company (now called Sun-Times Media Group Inc), which, having coughed up $100m so far for defence lawyers, has filed for bankruptcy.

Annually, the Supreme Court receives around 10,000 petitions for appeals and hears only 60 or so, so it's no wonder Black is in rambunctious form and predicting victory.

"I have the best Supreme Court counsel of all in Miguel Estrada," he wrote to me the other day in an email that was inventively and eruditely rude about a judge. No one does invectiveness as learnedly as Black.

Having been charged on 17 counts, Black was convicted on three of mail fraud and one of obstruction. What is concerning the Supreme Court is the issue of the 'honest services' provision of US fraud laws, which allow corporate executives and public officials to be charged with crimes, even if it can't be proved they stole.

'Honest service' was originally a means of prosecuting corrupt politicians, but it has been gradually extended to cover -- at least in theory -- any office-holder or employees shown to have failed to act in the best interests of constituents and employers.

If carried to its logical conclusion, pointed out Supreme Court Justice Scalia in a recent dissenting judgement, it would be a crime for "a state legislator's decision to vote for a bill because he expects it will curry favour with a small minority essential to his re-election; a major's attempt to use the prestige of his office to obtain a restaurant table without a reservation ... a salaried employee's phoning in sick to go to a ball game".

Such laws on this side of the pond would have most of the prisons full to the brim of politicians and bankers, which the public, in its present mood, might welcome, until they found themselves joining them because they made a mistake at work.

So, the Supreme Court will use the Black case to clarify what 'honest services' provisions actually mean, and with a fair wind, the three counts of mail fraud may be quashed. However, there is still the matter of obstruction, which carried a concurrent six-and-a-half-year term.

Black was convicted for removing 13 boxes of documents from his Toronto office, something he hotly contests was illegal but which weighted heavily with a confused jury because it was captured on CCTV. So, if the court lets that stand, he'll have to find yet more money for yet more lawyers to find him another route out of jail.

In a world reeling from economic troubles, legislators need to think seriously about the number of unnecessary laws they pass and putting an end to a crazy litigation culture. Soon there will be no one at work except lawyers, accountants and insolvency specialists. They'll have to pay an awful lot of tax to keep all the rest of us in prison or on the dole.

Ruth Dudley Edwards


Ruth posts articles that interest or amuse her and replies to comments from her eclectic group of friends and followers.

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