Criminal defense- Beware executive liability and the two-inference jury instruction
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A January 19, 2017, opinion from the federal Fourth Circuit provides important insight into the criminal liability of corporate executives, and the so-called “two-inference” jury instruction. United States v. Blankenship, ___ U.S. ___ (4th Cir., Jan. 19, 2017).
Although the foregoing legal issues may sound dry at first blush, they are important for lawyers to consider in advising corporate executives on their criminal liability for employees’ actions and their own actions, and also for avoiding damaging jury instructions in any criminal case. Furthermore, the factual allegations of this case show the very tragic underlying human story which — if believed — make Blankenship far from a sympathetic character:
“This case arises from a tragic accident on April 5, 2010 at the Upper Big Branch coal mine in Montcoal, West Virginia, which caused the death of 29 miners. Massey [Energy Company] owned and operated the Upper Big Branch mine. [The ]news reported that no survivors were found].
“In the years leading up to the accident, the federal Mine Safety & Health Administration (the ‘Mine Safety Administration’) repeatedly cited Massey for violations at the Upper Big Branch mine of the Mine Safety & Health Act of 1977, 30 U.S.C. § 801 et seq. (the ‘Mine Safety Act’), and its implementing regulations.1 In 2009 alone, the Mine Safety Administration identified 549 violations at the Upper Big Branch mine. Indeed, in the 15 months preceding the April 2010 accident, the Upper Big Branch mine received the third-most serious safety citations of any mine in the United States. Many of these violations related to improper ventilation and accumulation of combustible materials—problems that were key contributing factors to the accident. Defendant was aware of the violations at the Upper Big Branch mine in the years leading up to the accident, receiving daily reports showing the numerous citations for safety violations at the mine.”
Donald Blankenship was convicted for recklessly violating mine safety laws and regulations, in his then role as chairman and chief executive officer of Massey Energy Company. He unsuccessfully argued that the judge incorrectly allowed “reckless disregard” by a mine supervisor to the mine safety laws — rather than a higher standard of liability– to constitute criminal culpability in his case. In that regard, Blankenship says that the “Supreme Court long ago recognized… that ‘reckless disregard’ can amount to acting with a ‘bad purpose’ for purposes of criminal ‘willfulness.’ Screws v. United States, 325 U.S. 91, 101-04 (1945) (plurality op.). ”
Blankenship also unsuccessfully argued “that the district court reversibly erred in providing the so-called ‘two-inference’ instruction, pursuant to which it instructed the jury that if it ‘view[ed] the evidence in the case as reasonably permitting either of two conclusions—one of innocence, the other of guilt—the jury should, of course, adopt the conclusion of innocence.”
Blankenship joined it sister circuits in disfavoring the two-inference jury instruction, but concluded that “the district court’s use of that instruction here does not amount to reversible error because, when viewed as a whole, the court’s instructions correctly stated the government’s burden.”
Blankenship’s online docket shows that his trial took thirty-six days in court and that in-depth motions practice was engaged in, which likely means that his legal bill from his corporate criminal lawyers approached or even well exceeded one million dollars. He was sentenced to one year of incarceration.