TRIAL PRACTICE
Limiting the Government’s Economic Warfare

By J. Vincent Aprile II

In both the investigative and post-indictment phases of criminal cases, the police and prosecution often have the ability to conduct economic warfare against defendants, who have not yet been adjudicated guilty of any offense. When the defendant has an apparently legitimate business enterprise with a potential connection to the suspected offense, police and prosecutors have a variety of ways to undermine the ability of the suspect to maintain his or her livelihood and to deplete the suspect’s financial resources. What are the limitations on a prosecutor’s ability to conduct economic warfare, and where does a prosecutor go for guidance on these questions?

The ABA Criminal Justice Standards on Prosecutorial Investigations (February 2008) advise in a variety of situations that prosecutors should factor into their decisions the impact any specific investigative technique or its application may have on legitimate business operations. These standards acknowledge that the resort to both subpoenas and search warrants may adversely impact legitimate businesses and recognize the need for prosecutors to be selective as to the items seized and reasonable in making accommodations to provide access to the seized documents.

Prosecutors and law enforcement officers in this nation’s criminal justice system are imbued with a considerable amount of discretion in the investigation and prosecution of crimes. But discretion can be abused and decisions, although discretionary in nature, may in actuality be arbitrary and capricious under the facts and circumstances of a particular case.

The ability of prosecutors, utilizing grand jury subpoenas and search warrants, to seize and maintain the records of an ongoing, apparently legitimate business has the potential to destroy the viability of that enterprise long before the suspect’s guilt or innocence has been decided. In some instances, police, prosecutors, and their agents have engaged in “scare” campaigns calculated to entice established as well as potential customers to take their business elsewhere. Similar tactics have been used with employees of targeted businesses, urging them to quit and look for new employment or be tainted by association with their present employer. Even companies that are suppliers and distributors to the business under scrutiny may be pressured by police or prosecutors to cease their dealings with the enterprise under investigative scrutiny or pending prosecution.

This economic warfare is difficult for the defense to counter for a variety of reasons. Often those who are subjected to the scare campaigns are unwilling to confide to the business owner that the police or the prosecution have attempted to poison them against the owner and the enterprise. In many instances the suppliers and distributors do not wish to incur the ire of the police or prosecution by discussing the matter with the affected business. Government agencies that have dealings with the business may well feel that any request made by police or prosecutors should be honored. These agencies may believe that as to the legality of the requests, deference should be given to the police or prosecution.

Legislatures, both federal and state, in the interest of the common good have provided the police and prosecutors with numerous means to impact the viability of business enterprises prior to conviction of the owner and proof that the business was tainted by the criminal activity. In some jurisdictions and in some cases, the return of an indictment against a business owner may be deemed sufficient to justify a government agency immediately limiting the ability of the defendant’s business to operate. These laws apparently fail to take into account that an indictment may be obtained with little or no legitimate evidence to support the charge.

When the defense focuses its time and effort on these “economic warfare” issues, which are ancillary to the suspected or charged criminal activity, the investigation and litigation of those matters compete with the defense’s responsibility to explore and address the alleged criminal conduct.

A further complication arises when the defense attempts to determine the most effective and appropriate avenues to address these bouts of economic warfare. One obvious avenue would be to go to those in authority over the police or prosecutor engaging in this conduct. This presents an inherent difficulty because the defense may be unable to determine whether the economic warfare has been implicitly or explicitly condoned by those high in the police or prosecutorial chain of command. The defense’s resort to other parallel law enforcement agencies or prosecutorial offices may be met with unabashed umbrage that the defense would accuse these other public servants of such inappropriate conduct. Not surprisingly, these parallel offices frequently feel it is their duty to advise the police or prosecutors of the defense’s accusations rather than conducting any discreet investigation of the matter.

Where the economic warfare is being conducted prior to an indictment or information, it may be difficult to turn to a criminal court for relief because no court, save in some instances the one supervising the grand jury, is yet involved in the matter. Even once a criminal court has jurisdiction over the case, the more elusive issues of economic warfare may seem beyond the court’s jurisdiction.

The economic tools available to law enforcement and the prosecution must be used wisely and carefully lest the government be allowed to punish, at least economically, before conviction and simultaneously gain a litigation advantage by bankrupting a defendant before trial.

Undoubtedly, many prosecutors would never engage in any of these examples of economic warfare and would always, in accordance with the ABA Criminal Justice Standards on Prosecutorial Investigations, take into consideration the impact of investigation techniques on legitimate businesses and provide reasonable accommodations to these businesses to ensure prompt and effective access to seized records and other items important to an ongoing commercial enterprise. Yet there must be a number of police and prosecutors who, whether intentionally or negligently, run roughshod over suspects and unconvicted defendants by the unchecked use of this type of economic warfare.

This is an area where the American Bar Association, through its Criminal Justice Standards, could provide more explicit guidance to prosecutors on how to exercise their discretion with regard to the actions they and the police take that have the potential to cripple or destroy a suspect’s apparently legitimate business. Certainly the National District Attorneys Association could more definitively address this area in its National Prosecution Standards (third edition, updated 2009), which already provides prosecutors with guidance in many areas.

Standards that specifically declare certain of these economic practices taboo and require explicit disclosure to the suspect or the defendant of the actions taken by police or prosecution with regard to customers, employees, suppliers, and/or other governmental agencies pertaining to the business in question would go far toward alleviating many of these problems. Informed prosecutors in turn would be better able to advise their own investigators and other law enforcement personnel concerning these matters.


  • J. Vincent Aprile II specializes in criminal law, employment law, and litigation at Lynch, Cox, Gilman & Goodman, P.S.C., in Louisville, Kentucky; he may be reached at vaprile@lcgandm.com.

    Copyright 2010

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