Last week, the U.S. Supreme Court announced it would not hear the appeal of Sholom Rubashkin, sentenced to 27 years in prison in a case that involved a federal judge who was in on the planning of the case with government agents from the original raid on his business. The court is saying, in essence, that federal judges are not bound by any appreciable rules of conduct, and that there is no recourse for the citizen who is victimized by judicial and prosecutorial misconduct.
To the casual observer, the SCOTUS did the right thing. Here is a guy who broke the law, defrauded a bank, and got what he richly deserved, or at least that is how the media has portrayed this case. However, a number of people have taken a hard look at the conduct of Judge Linda Reade and have come up with a much different opinion: that what she did was an outright travesty of justice.
Judges and prosecutors have awesome powers and the SCOTUS already has ruled that they are immune from any challenges from private citizens. In the end, we have yet another example of the government "investigating" the government and declaring that the government has acted justly.
In rejecting Rubashkin's appeal, the SCOTUS also ignored legal pleas from a large number of former officials of the U.S. Department of Justice and civil liberties advocate Harvey Silverglate. When people of disparate political opinions are willing to join together and ask the High Court to examine the conduct of federal officials, this is something not to be taken lightly. Instead, even their opinions were blown off as though they were nothing.
Showing posts with label Sholom Rubashkin. Show all posts
Showing posts with label Sholom Rubashkin. Show all posts
Friday, October 5, 2012
Thursday, September 20, 2012
Sholom Rubashkin and the Unethical Judge
A couple years ago, I wrote on what I believed was a miscarriage of justice in the federal case against Sholom Rubashkin, the CEO of a now-shuttered kosher meat facility in Iowa. The Rubashkin case is one that draws a lot of different opinions, in part because there are so many elements involved from the hiring of illegal immigrants to accusations from PETA about mistreatment of animals to the issue of financial fraud.
I addressed each of those issues in a previous blog, but it seems to me that the worst part is the conduct of the federal judge in that case, Linda Reade, who immersed herself in the original immigration raid of the plant and who also seemed to have a role in directing how federal authorities should act. As Emily Bazelon wrote recently in Slate, Reade's involvement definitely seemed to cross the line of judicial impropriety:
I addressed each of those issues in a previous blog, but it seems to me that the worst part is the conduct of the federal judge in that case, Linda Reade, who immersed herself in the original immigration raid of the plant and who also seemed to have a role in directing how federal authorities should act. As Emily Bazelon wrote recently in Slate, Reade's involvement definitely seemed to cross the line of judicial impropriety:
Still, in asking the Supreme Court to take the case, Rubashkin’s lawyers—who now include former Solicitor General Paul Clement—are asking the justices to take a stand on Reade’s participation in the immigration raid planning. The argument is that Reade and the prosecutors had an obligation to tell Rubashkin’s lawyers about all that pre-raid planning. Except in very limited circumstances, judges aren’t allowed to meet with one side in a case without the other, and so those weekly meetings broke the rules. Several friend-of-the-court briefs have been written in support of Rubashkin’s position, or are on the way, and the signers include former judges and U.S. attorneys. One of the briefs was co-authored by my sister Lara, who is a clinical teaching fellow at the University of California Hastings law school, and lawyer Allison Ehlert.Bazelon adds:
In response, Reade and the government have said there’s nothing to see here. The judge attended all those meetings simply to save her court a headache. Her support for the raid was about logistics, nothing more, and there’s no reason that wearing her administrative hat would have biased her against Rubashkin once she put her judge hat back on. Maybe so. But judges aren’t just supposed to be impartial, they’re supposed to make sure they don’t create the appearance of bias. Wouldn’t it be better, as a general rule, if judges who meet regularly with prosecutors in advance of a cascade of high-profile indictments didn’t hear the cases that follow? Rubashkin’s prosecution was the culmination of the raid, in a sense. Getting him was the best way to justify the spectacle of the processing of the sad sack Guatemalans on the cattle fairground, which we know from her comments to the New York Times Reade felt she had to defend (and which another federal judge in Iowa later called a “travesty”).
The larger problem here is that, practically speaking, federal judges have enormous leeway in deciding whether to take themselves off a case because of potential bias or perceived bias. When they make a bad call, there are rarely any consequences. In all likelihood, the Supreme Court will turn Rubashkin down and refuse to intervene this time, too. The jury who convicted Rubashkin sat for 18 days and reviewed more than 9,000 exhibits, and the justices probably have as little appetite for a do-over as they do for smacking down Judge Reade. But even if you can’t bring yourself to care much about the fate of Sholom Rubashkin, the oddities of this case don’t sit well. Judges shouldn’t be able to make up their own rules for policing themselves.
While Bazelon is not sympathetic to the rest of Rubashkin's legal case (contrary to my own opinion), nonetheless I believe that when a large number of former federal legal luminaries are willing to file briefs with the court saying they have a problem with what has happened, then I believe this is not an ordinary situation. Like Bazelon, I do believe that the Supreme Court will defer to Reade's judgment, which I believe will be a terribly mistaken thing.
The Rubashkin camp has put out a video that I believe is worth watching, as it quotes my friend and mentor, Harvey Silverglate, and I believe it does make a good case for pointing out the travesties in this particular case. Yes, it does come from Rubashkin's supporters, but in federal criminal cases, we simply cannot depend upon either the government or the mainstream media (which generally adores federal prosecutors) to tell the truth.
The High Court is due to issue its decision on granting Rubashkin certiorari on September 24. Given the outrages that the SCOTUS already has unleashed in the past few years, I only can hope that for once in their lives the justices care about the things that judges and prosecutors actually do that either violate the law or are very suspicious. We shall see.
The Rubashkin camp has put out a video that I believe is worth watching, as it quotes my friend and mentor, Harvey Silverglate, and I believe it does make a good case for pointing out the travesties in this particular case. Yes, it does come from Rubashkin's supporters, but in federal criminal cases, we simply cannot depend upon either the government or the mainstream media (which generally adores federal prosecutors) to tell the truth.
The High Court is due to issue its decision on granting Rubashkin certiorari on September 24. Given the outrages that the SCOTUS already has unleashed in the past few years, I only can hope that for once in their lives the justices care about the things that judges and prosecutors actually do that either violate the law or are very suspicious. We shall see.
Monday, August 9, 2010
Rubashkin's Appeal
As one who often writes about courts and prosecutorial misconduct, I must admit to having no confidence anymore in American judges having any integrity at all. One of the defining moments for me came in the Tonya Craft case in North Georgia when the judge, Brian House, literally took cues from the prosecutors during the trial, as they gave him hand signals and other indications of what he needed to do in certain situations.
It should surprise no one that House desperately tried to rig a conviction, and when he received the “not guilty” verdict from jurors and read it before the verdict was read to the people in the courtroom, his face turned ashen and his expression was one of utter shock. However dishonest and sordid his actions, at least House was unable to get the jurors to vote his way; Shalom Rubashkin was not so fortunate, as his judge not only was hostile to him throughout the trial, but now we find that the judge played an important role in the prosecution of the case.
In my first article on Rubashkin’s conviction, I dealt with the charges and the sentence that Judge Linda Reade imposed on him – 27 years, which is longer than many murderers receive – and was entirely out-of-kilter with what the law is supposed to do. Readers know that I have trouble with how federal criminal law is imposed and how prosecutors can take about any action, including a legal action, and roll it into the “fraud” statutes that enable prosecutors to make their careers.
However, new documents released now demonstrate that Reade was far more involved in this case than I could have imagine, and that there is no way humanly possible for her to have done what supposedly is her job: be an impartial jurist:
The media and the courts have framed this as a “financial fraud” case, as though Rubashkin was the Second Coming of Bernie Madoff. However, the “financial fraud” that Rubashkin committed was not “fraud” at all in the historical sense. This is what I described in my previous article:
Thus, the real cause of the losses was not the business practices of Rubashkin per se, but rather the way that the federal government dealt with the situation. The Bush administration wanted to make a statement to its conservative base regarding illegal immigrants being employed in the United States and it chose to make an example of Rubashkin and Agriprocessors.
Keep in mind that the feds can do the same to any business, even those businesses that absolutely operate above board in every way. Federal agents can act on false allegations (which they do all the time), raid the place, shut it down, and then claim that the entire operation was fraudulent after the company cannot pay its bills, and don’t think they don’t do this.
Federal agents have absolutely no personal stake in the success of a business or even private enterprise in general. They are in privileged positions and can extract whatever they want from people who are not so well-placed, and they do it on a regular basis. That means that if they drive legitimate businesses into bankruptcy, that is no problem to them, and if other lives are ruined and the economy sinks a little bit lower, who cares? The prosecutors and judges get their paychecks.
If anything, the revelations that Reade was involved up to her eyeballs in the Rubashkin case from the very beginning sets a new low in federal criminal law – if it is impossible for these people to sink any lower. It absolutely is clear that from the start, Reade was trying to engineer an arrest and conviction, and if she had an ounce of integrity (honest federal official, of course, is an oxymoron), she would resign immediately.
However, I am sure that Reade will go on as though nothing happened. One hopes that the appellate courts will note the misconduct, but I will not be holding my breath.
It should surprise no one that House desperately tried to rig a conviction, and when he received the “not guilty” verdict from jurors and read it before the verdict was read to the people in the courtroom, his face turned ashen and his expression was one of utter shock. However dishonest and sordid his actions, at least House was unable to get the jurors to vote his way; Shalom Rubashkin was not so fortunate, as his judge not only was hostile to him throughout the trial, but now we find that the judge played an important role in the prosecution of the case.
In my first article on Rubashkin’s conviction, I dealt with the charges and the sentence that Judge Linda Reade imposed on him – 27 years, which is longer than many murderers receive – and was entirely out-of-kilter with what the law is supposed to do. Readers know that I have trouble with how federal criminal law is imposed and how prosecutors can take about any action, including a legal action, and roll it into the “fraud” statutes that enable prosecutors to make their careers.
However, new documents released now demonstrate that Reade was far more involved in this case than I could have imagine, and that there is no way humanly possible for her to have done what supposedly is her job: be an impartial jurist:
A federal judge conspired with the Bush Department of Justice to plan the largest immigration raid ever in the United States, and then presided over the trial of the plant’s manager, eventually sentencing him beyond even prosecutors’ recommendation.Indeed, all through the proceedings leading up to the trial, and then during the trial itself, it was clear that Reade has utterly hostile to the defendant. Furthermore, the very notion that she played what effectively was a “law enforcement” and prosecutorial role even before Rubashkin’s kosher meat processing plant was raided automatically should have disqualified her. Furthermore, by stepping outside of her role as a judge, she opens herself to lawsuits, as she has absolute immunity only in her role as a judge, not as a law enforcement officer.
New documents show Linda Reade, the chief judge of the U.S. District Court for the Northern District of Iowa, was involved in the planning of the Immigrations and Customs Enforcement raid on the Agriprocessors kosher meatpacking plant at least six months before it occurred in May 2008. She asked for briefings from law enforcement and went as far as to ensure the raid was conducted around her vacation schedule.
But the judge never said a word of this to the defense lawyers for Sholom Rubashkin, the Agriprocessors manager, when she presided over his trial on bank fraud. She didn’t recuse herself from the case, either.
The media and the courts have framed this as a “financial fraud” case, as though Rubashkin was the Second Coming of Bernie Madoff. However, the “financial fraud” that Rubashkin committed was not “fraud” at all in the historical sense. This is what I described in my previous article:
In the case of Agriprocessors, the loan was a revolving $35 million payout that enabled the company to keep a steady cash flow, meet payroll, and pay its bills. The firm was not arrears in payment, and all indications were that the company would be able to meet its obligations to the bank.Now, the bank would not have called the loan and lost all those millions had the federal government not shut down Agriprocessors. However, the government is claiming that the business itself was a $35 million fraud, as though Rubashkin were running a Ponzi scheme. (Oh, sorry, only the government is permitted to run a Ponzi program that we know as Social Security.)
Because the federal courts have eviscerated the ancient doctrine of mens rea, which means that prosecutors needed to prove that a person charged intended to commit a crime, intent to defraud no longer matters. In fact, one can argue that Agriprocessors did not "defraud" First Bank at all, and there are indications that the bank knew that Agriprocessors was overstating its revenues and underestimating its costs (something the federal government does every year, but never results in anyone’s arrest), but did not care because its good customer paid its bills on time. The company was profitable, and so was the bank.
That was not all, according to the feds. Apparently, certain suppliers of cattle and other things are required by a little-known (and almost never enforced) law from the 1920s to be paid within 24 hours. No one had complained about the late payments, to my knowledge; instead, it was yet another of those "legal technicalities" that federal prosecutors use when they want to convict someone on something.
Thus, the real cause of the losses was not the business practices of Rubashkin per se, but rather the way that the federal government dealt with the situation. The Bush administration wanted to make a statement to its conservative base regarding illegal immigrants being employed in the United States and it chose to make an example of Rubashkin and Agriprocessors.
Keep in mind that the feds can do the same to any business, even those businesses that absolutely operate above board in every way. Federal agents can act on false allegations (which they do all the time), raid the place, shut it down, and then claim that the entire operation was fraudulent after the company cannot pay its bills, and don’t think they don’t do this.
Federal agents have absolutely no personal stake in the success of a business or even private enterprise in general. They are in privileged positions and can extract whatever they want from people who are not so well-placed, and they do it on a regular basis. That means that if they drive legitimate businesses into bankruptcy, that is no problem to them, and if other lives are ruined and the economy sinks a little bit lower, who cares? The prosecutors and judges get their paychecks.
If anything, the revelations that Reade was involved up to her eyeballs in the Rubashkin case from the very beginning sets a new low in federal criminal law – if it is impossible for these people to sink any lower. It absolutely is clear that from the start, Reade was trying to engineer an arrest and conviction, and if she had an ounce of integrity (honest federal official, of course, is an oxymoron), she would resign immediately.
However, I am sure that Reade will go on as though nothing happened. One hopes that the appellate courts will note the misconduct, but I will not be holding my breath.
Monday, June 21, 2010
Free Sholom Rubashkin!
This week, Sholom Rubashkin, who was the CEO of what was once the largest kosher meat processing supplier in the world, will be sentenced to federal prison for “financial fraud.” Prosecutors will ask for essentially a life sentence, while a lot of other people, including a number of former U.S. attorneys general, are asking for leniency.
I will go against all of them. Sholom Rubashkin, in my view, does not need “leniency.” He needs to be freed, period, for the man is not a criminal, which is more than I can say for the people who hounded and prosecuted him and destroyed his business, Glatt kosher Agriprocessors of Postville, Iowa. Let me begin.
Rubashkin is a Hasidic Jew, his family having fled the U.S.S.R. after the Nazi invasion. They came to the United States and set up a butcher shop in New York City. After marriage , he and his new bride moved to Atlanta on shlihut to do kiruv (Jewish outreach). At about the same time, Rubashkin’s father started a kosher meat processing business in Postville to better enable Jews living outside of main Jewish centers to be able to obtain kosher meat.
Before Glatt kosher Agriprocessors began to expand its business, Jewish families could only purchase kosher meat from small butchers and specialty stores that catered to Jews. This made things more difficult for Jewish families who did not leave near these kinds of stores, but by expanding the amount of kosher meat for sale, the firm was able to bring kosher meat to regular grocery stores, which was not a small development for jewish families.
Soon, Rubashkin joined his father’s company and the family moved to Postville. As the Jewish Daily Forward declared (more about the Forward later), the Rubashkins literally changed how Jewish people in the United States eat. Like many others who practice Hasidism, the Rubashkins were generous to people in the community, both Jews and non-Jews, and generated a lot of good will as a major employer in that area.
Unfortunately, being successful in the United States these days does not garner praise; it makes one a target of people who specialize in promoting strife and envy. In this Age of Envy and dominance by the state, it seems that the only entrepreneurship that is acceptable is political entrepreneurship, and the Rubashkins did not fall into that category. (Public Choice economists call such political entrepreneurship “rent seeking.”) The Rubashkins made their living from processing meat, and that meant slaughtering animals according to Jewish dietary laws that are thousands of years old, and that attracted the attention of the People for the Ethical Treatment of Animals.
First, PETA charged in magazine articles that the Rubashkin plant was a veritable house of horrors, something out of an Upton Sinclair novel. (Notice, I say that The Jungle is a novel, since it was written as socialist propaganda and had as much veracity as did PETA’s charges.) The organization charged that the place was a filthy hellhole with unsanitary (at best) facilities where animals were tortured and worse, and filed a complaint with the U.S. Department of Agriculture.
Second, while it was clear that PETA’s charges were false, nonetheless the organization managed to put the kosher meat facility in the public eye, thus making it a bigger target for federal authorities. The next organization to go after Glatt kosher Agriprocessors was the United Food and Commercial Workers Union, which had been unsuccessful in organizing the plant. Part of the problem was its workforce, and anyone who has been near a meat or chicken processing plant will know that a lot of immigrants from Mexico and Central America work there, as well as Asian immigrants.
Work in these plants is hard and low-paying, but low-skilled workers nonetheless are able to band together and make enough money to live in the United States and send money back home to relatives. However, they clearly were not candidates for union membership, which not only enraged the union leadership, but also caught the attention of liberal Jewish groups that don’t much care for the ultra-orthodox Hasidim, including the publishers of the Jewish Daily Forward.
The Forward ran a number of articles (sourced by the UFCW, of course) that claimed Rubashkin was hiring not only illegal immigrants, but also was exploiting child labor. At the same time, political conservatives such as Wesley Pruden of the Washington Times, were mounting a huge campaign against illegal immigration, and the Bush administration decided to make an example out of Agriprocessors and staged an extremely public raid on the facilities in 2008.
Keep in mind that the government went full-scale paramilitary on its raid, complete with a Blackhawk helicopter, and heavily-armed police carrying submachine guns and other weapons. The raid was no surprise; in fact, days earlier, Rubashkin knew the raid was coming and personally contacted the federal authorities and promised to cooperate with them.
Not surprisingly, the Bush administration did things its way, and its way was to be as brutal as possible. More than 300 workers were rounded up, denied legal representation, and forced to plead guilty to a number of charges. They were imprisoned for up to five months, and then deported. The feds then seized all of the company’s records and went on a fishing expedition.
Ultimately, the government charged Rubashkin with financial fraud, claiming that the company had faked invoices and other financial documents in order to inflate its financial assets in order to qualify for larger loan amounts from First Bank of St. Louis. In fact, Rubashkin’s firm had overstated its revenues, but that is much more common than one might think and generally does not land one in a criminal trial.
I will give an example that most readers can understand, a personal example. Last year, we refinanced our mortgage, and an appraiser came to our house to see if we would qualify for the best deals. There was a “magic” number for our house’s value, and he asked me at least twice if I believed that our place qualified.
My answer always was the same: “I have no idea. That is up to you.” Now, I was hoping that he would see to it that our house met the so-called value threshold, although I had serious doubts that we actually could sell our house on the open market at that price, and I was not going to say anything that legally could get me into trouble later on. In fact, during the refinancing boom of the last decade, appraisers generally overstated the market value of houses so that the owners or perspective buyers could qualify for certain loans.
Was this fraud? Legally, it was. How far did the fraud go, and who perpetrated it? It would determine who the feds wished to target before that decision could be made. For example, if the feds wished to crucify the homeowner, they can get the appraiser to testify and the homeowner lied to them, and, no doubt, the bankers would testify that they never would have approved the jumbo-sized loan had not the homeowner or perspective buyer defrauded them.
That would be a lie, but federal prosecutors regularly suborn perjury, something I have documented in dozens of articles over the years. For that matter, if the feds wished to nail the bankers or the appraisers, they would “convince” the others in that chain to testify to whatever would be the most damning testimony. It would not matter as to what really happened, as federal prosecutors famously create their own reality, or at least a reality that the courts, the political classes, and the media will swallow.
In the case of Agriprocessors, the loan was a revolving $35 million payout that enabled the company to keep a steady cash flow, meet payroll, and pay its bills. The firm was not arrears in payment, and all indications were that the company would be able to meet its obligations to the bank.
Because the federal courts have eviscerated the ancient doctrine of mens rea, which means that prosecutors needed to prove that a person charged intended to commit a crime, intent to defraud no longer matters. In fact, one can argue that Agriprocessors did not “defraud” First Bank at all, and there are indications that the bank knew that Agriprocessors was overstating its revenues and underestimating its costs (something the federal government does every year, but never results in anyone’s arrest), but did not care because its good customer paid its bills on time. The company was profitable, and so was the bank.
That was not all, according to the feds. Apparently, certain suppliers of cattle and other things are required by a little-known (and almost never enforced) law from the 1920s to be paid within 24 hours. No one had complained about the late payments, to my knowledge; instead, it was yet another of those “legal technicalities” that federal prosecutors use when they want to convict someone on something.
I won’t dwell on Sholom Rubashkin’s trial, except to say that there were some highly-prejudicial aspects that should be mentioned. Certainly, Hasidim are to people in Iowa what Old Order Amish might be to people from New York City: alien creatures from outer space. Hasidic Jews live a separate life, although it is clear to many people in Postville, Rubashkin, his family, and his company were heroes and important to the community and its well-being.
None of that mattered to the jury located in Sioux Falls, South Dakota, where the trial was held, and federal jurors quickly returned guilty verdicts. According to the New York Times, the damning testimony came when…
On another front, the State of Iowa originally charged Rubashkin with more than 9,000 counts of child labor law violations and he recently stood trial. Even after prosecutors amended the charges to just 83, they could not win a single conviction. (While state courts are known to be corrupt, unlike the federal courts, evidence generally matters in state trials.)
Unfortunately, there is more. After the feds originally charged Rubashkin with fraud charges, the prosecutors argued that he was a “flight risk” and should be imprisoned. Their reasoning? Rubashkin is a Jew and the nation of Israel grants expedited citizenship to Jews around the world. They further stretched the story by pointing out that Rubashkin kept about $20,000 in cash, as well as his passports and other documents in a lockbox in his home.
There are two aspects to that story. First, most of us keep some cash and papers in lockboxes, and we are among that “criminal” crowd that likes to keep these things in a single place just in case we need them. Second, one of the Rubashkin children is autistic, and the family knew they needed to keep certain papers secure in a place where that child would not be able to find and disturb or scatter them, not realizing what they were. Obviously, this is something that would affect literally every Jew charged with a crime, given that the vast majority of them are considered to be “citizens” of Israel, even if very, very few of them actually would do such a thing. (For that matter, anyone with a passport and cash would be considered a “flight risk” to somewhere, given those standards.)
There is another, more troubling, aspect of this case to me, and it goes to the heart of federal criminal law and how it is enforced. Bernie Madoff was guilty of fraud; he ran a Ponzi scheme, and no Ponzi scheme – including those run by the government – can survive over time. Madoff knew that sooner or later, his investors would lose their money, and that is exactly what happened.
Fraud goes to intent. One defrauds someone else if one purposely charts a course of action that will negatively affect the other party, while promising to give that party positive results. For example, if I borrow money in order to start a business, but then use those funds instead for a Caribbean cruise, that is fraud.
However, Sholom Rubashkin intended to pay back his loans, as he always had done, and he intended his business to continue to provide kosher meat to people who wanted to buy it. He had no plans to abscond with the money he borrowed, with people showing up to work one day and finding the place padlocked and Rubashkin and his family on a secret cruise to Israel.
There was no fraud in the historic sense of the word. If there was misrepresentation of his funds, that was a civil and contractual matter between Agriprocessors and First Bank, and, let’s face it, had the feds not invaded his plant and shut down the operation, Agriprocessors still would be in operation today and most of us never would have heard of Sholom Rubashkin.
To understand federal criminal law today, one must remember that it is something far removed from the roots of what criminal law used to be in the United States. In the past, a crime designated real harm done by one party to another, whether it was robbery, murder, assault, rape or something in which it was obvious that one party clearly injured another.
Today, however, most federal criminal law falls into the “public welfare” category, in which a person charged has failed to perform a certain so-called public duty, or has failed to follow a set of rules which often are arbitrarily set up and even more arbitrarily administered. Not surprisingly, we have seen federal criminal law put to an increasing number of political applications. The legal language might be similar to what it was in the past, but now it is describing certain things that might have political meaning, but describe simple disobedience from the federally-prescribed way of doing things.
The irony is that the feds are calling this a huge “fraud,” but the only people really being defrauded are the victims of this federal assault. Let us look at the real damage that the feds have inflicted upon people:
Literally, thousands of people were harmed by what the government did. However, no one from the federal government lost a dime.
I will go against all of them. Sholom Rubashkin, in my view, does not need “leniency.” He needs to be freed, period, for the man is not a criminal, which is more than I can say for the people who hounded and prosecuted him and destroyed his business, Glatt kosher Agriprocessors of Postville, Iowa. Let me begin.
Rubashkin is a Hasidic Jew, his family having fled the U.S.S.R. after the Nazi invasion. They came to the United States and set up a butcher shop in New York City. After marriage , he and his new bride moved to Atlanta on shlihut to do kiruv (Jewish outreach). At about the same time, Rubashkin’s father started a kosher meat processing business in Postville to better enable Jews living outside of main Jewish centers to be able to obtain kosher meat.
Before Glatt kosher Agriprocessors began to expand its business, Jewish families could only purchase kosher meat from small butchers and specialty stores that catered to Jews. This made things more difficult for Jewish families who did not leave near these kinds of stores, but by expanding the amount of kosher meat for sale, the firm was able to bring kosher meat to regular grocery stores, which was not a small development for jewish families.
Soon, Rubashkin joined his father’s company and the family moved to Postville. As the Jewish Daily Forward declared (more about the Forward later), the Rubashkins literally changed how Jewish people in the United States eat. Like many others who practice Hasidism, the Rubashkins were generous to people in the community, both Jews and non-Jews, and generated a lot of good will as a major employer in that area.
Unfortunately, being successful in the United States these days does not garner praise; it makes one a target of people who specialize in promoting strife and envy. In this Age of Envy and dominance by the state, it seems that the only entrepreneurship that is acceptable is political entrepreneurship, and the Rubashkins did not fall into that category. (Public Choice economists call such political entrepreneurship “rent seeking.”) The Rubashkins made their living from processing meat, and that meant slaughtering animals according to Jewish dietary laws that are thousands of years old, and that attracted the attention of the People for the Ethical Treatment of Animals.
First, PETA charged in magazine articles that the Rubashkin plant was a veritable house of horrors, something out of an Upton Sinclair novel. (Notice, I say that The Jungle is a novel, since it was written as socialist propaganda and had as much veracity as did PETA’s charges.) The organization charged that the place was a filthy hellhole with unsanitary (at best) facilities where animals were tortured and worse, and filed a complaint with the U.S. Department of Agriculture.
Second, while it was clear that PETA’s charges were false, nonetheless the organization managed to put the kosher meat facility in the public eye, thus making it a bigger target for federal authorities. The next organization to go after Glatt kosher Agriprocessors was the United Food and Commercial Workers Union, which had been unsuccessful in organizing the plant. Part of the problem was its workforce, and anyone who has been near a meat or chicken processing plant will know that a lot of immigrants from Mexico and Central America work there, as well as Asian immigrants.
Work in these plants is hard and low-paying, but low-skilled workers nonetheless are able to band together and make enough money to live in the United States and send money back home to relatives. However, they clearly were not candidates for union membership, which not only enraged the union leadership, but also caught the attention of liberal Jewish groups that don’t much care for the ultra-orthodox Hasidim, including the publishers of the Jewish Daily Forward.
The Forward ran a number of articles (sourced by the UFCW, of course) that claimed Rubashkin was hiring not only illegal immigrants, but also was exploiting child labor. At the same time, political conservatives such as Wesley Pruden of the Washington Times, were mounting a huge campaign against illegal immigration, and the Bush administration decided to make an example out of Agriprocessors and staged an extremely public raid on the facilities in 2008.
Keep in mind that the government went full-scale paramilitary on its raid, complete with a Blackhawk helicopter, and heavily-armed police carrying submachine guns and other weapons. The raid was no surprise; in fact, days earlier, Rubashkin knew the raid was coming and personally contacted the federal authorities and promised to cooperate with them.
Not surprisingly, the Bush administration did things its way, and its way was to be as brutal as possible. More than 300 workers were rounded up, denied legal representation, and forced to plead guilty to a number of charges. They were imprisoned for up to five months, and then deported. The feds then seized all of the company’s records and went on a fishing expedition.
Ultimately, the government charged Rubashkin with financial fraud, claiming that the company had faked invoices and other financial documents in order to inflate its financial assets in order to qualify for larger loan amounts from First Bank of St. Louis. In fact, Rubashkin’s firm had overstated its revenues, but that is much more common than one might think and generally does not land one in a criminal trial.
I will give an example that most readers can understand, a personal example. Last year, we refinanced our mortgage, and an appraiser came to our house to see if we would qualify for the best deals. There was a “magic” number for our house’s value, and he asked me at least twice if I believed that our place qualified.
My answer always was the same: “I have no idea. That is up to you.” Now, I was hoping that he would see to it that our house met the so-called value threshold, although I had serious doubts that we actually could sell our house on the open market at that price, and I was not going to say anything that legally could get me into trouble later on. In fact, during the refinancing boom of the last decade, appraisers generally overstated the market value of houses so that the owners or perspective buyers could qualify for certain loans.
Was this fraud? Legally, it was. How far did the fraud go, and who perpetrated it? It would determine who the feds wished to target before that decision could be made. For example, if the feds wished to crucify the homeowner, they can get the appraiser to testify and the homeowner lied to them, and, no doubt, the bankers would testify that they never would have approved the jumbo-sized loan had not the homeowner or perspective buyer defrauded them.
That would be a lie, but federal prosecutors regularly suborn perjury, something I have documented in dozens of articles over the years. For that matter, if the feds wished to nail the bankers or the appraisers, they would “convince” the others in that chain to testify to whatever would be the most damning testimony. It would not matter as to what really happened, as federal prosecutors famously create their own reality, or at least a reality that the courts, the political classes, and the media will swallow.
In the case of Agriprocessors, the loan was a revolving $35 million payout that enabled the company to keep a steady cash flow, meet payroll, and pay its bills. The firm was not arrears in payment, and all indications were that the company would be able to meet its obligations to the bank.
Because the federal courts have eviscerated the ancient doctrine of mens rea, which means that prosecutors needed to prove that a person charged intended to commit a crime, intent to defraud no longer matters. In fact, one can argue that Agriprocessors did not “defraud” First Bank at all, and there are indications that the bank knew that Agriprocessors was overstating its revenues and underestimating its costs (something the federal government does every year, but never results in anyone’s arrest), but did not care because its good customer paid its bills on time. The company was profitable, and so was the bank.
That was not all, according to the feds. Apparently, certain suppliers of cattle and other things are required by a little-known (and almost never enforced) law from the 1920s to be paid within 24 hours. No one had complained about the late payments, to my knowledge; instead, it was yet another of those “legal technicalities” that federal prosecutors use when they want to convict someone on something.
I won’t dwell on Sholom Rubashkin’s trial, except to say that there were some highly-prejudicial aspects that should be mentioned. Certainly, Hasidim are to people in Iowa what Old Order Amish might be to people from New York City: alien creatures from outer space. Hasidic Jews live a separate life, although it is clear to many people in Postville, Rubashkin, his family, and his company were heroes and important to the community and its well-being.
None of that mattered to the jury located in Sioux Falls, South Dakota, where the trial was held, and federal jurors quickly returned guilty verdicts. According to the New York Times, the damning testimony came when…
Former Agriprocessors employees testified that Mr. Rubashkin had personally directed them to create false invoices to show First Bank, which is based in St. Louis, that the plant had more money flowing in than it really did.Knowing how federal prosecutors operate, I have no idea if any of those witnesses told the truth. Federal prosecutors are well-known for suborning perjury and are especially known to do it in high-profile cases, such as this one. One can be sure that the people who testified was told that if they did not testify according to a certain script, then the feds would levy fraud charges against them, too. (If the readers wishes to gain some insight into how federal prosecutors lie in order to gain testimony they want, read this link to what the feds did in the trial of Jeffrey Skilling of Enron. Because no federal prosecutor ever has to worry about being charged with suborning perjury, one can bet that this kind of behavior is the norm, not the exception, among U.S. attorneys.)
On another front, the State of Iowa originally charged Rubashkin with more than 9,000 counts of child labor law violations and he recently stood trial. Even after prosecutors amended the charges to just 83, they could not win a single conviction. (While state courts are known to be corrupt, unlike the federal courts, evidence generally matters in state trials.)
Unfortunately, there is more. After the feds originally charged Rubashkin with fraud charges, the prosecutors argued that he was a “flight risk” and should be imprisoned. Their reasoning? Rubashkin is a Jew and the nation of Israel grants expedited citizenship to Jews around the world. They further stretched the story by pointing out that Rubashkin kept about $20,000 in cash, as well as his passports and other documents in a lockbox in his home.
There are two aspects to that story. First, most of us keep some cash and papers in lockboxes, and we are among that “criminal” crowd that likes to keep these things in a single place just in case we need them. Second, one of the Rubashkin children is autistic, and the family knew they needed to keep certain papers secure in a place where that child would not be able to find and disturb or scatter them, not realizing what they were. Obviously, this is something that would affect literally every Jew charged with a crime, given that the vast majority of them are considered to be “citizens” of Israel, even if very, very few of them actually would do such a thing. (For that matter, anyone with a passport and cash would be considered a “flight risk” to somewhere, given those standards.)
There is another, more troubling, aspect of this case to me, and it goes to the heart of federal criminal law and how it is enforced. Bernie Madoff was guilty of fraud; he ran a Ponzi scheme, and no Ponzi scheme – including those run by the government – can survive over time. Madoff knew that sooner or later, his investors would lose their money, and that is exactly what happened.
Fraud goes to intent. One defrauds someone else if one purposely charts a course of action that will negatively affect the other party, while promising to give that party positive results. For example, if I borrow money in order to start a business, but then use those funds instead for a Caribbean cruise, that is fraud.
However, Sholom Rubashkin intended to pay back his loans, as he always had done, and he intended his business to continue to provide kosher meat to people who wanted to buy it. He had no plans to abscond with the money he borrowed, with people showing up to work one day and finding the place padlocked and Rubashkin and his family on a secret cruise to Israel.
There was no fraud in the historic sense of the word. If there was misrepresentation of his funds, that was a civil and contractual matter between Agriprocessors and First Bank, and, let’s face it, had the feds not invaded his plant and shut down the operation, Agriprocessors still would be in operation today and most of us never would have heard of Sholom Rubashkin.
To understand federal criminal law today, one must remember that it is something far removed from the roots of what criminal law used to be in the United States. In the past, a crime designated real harm done by one party to another, whether it was robbery, murder, assault, rape or something in which it was obvious that one party clearly injured another.
Today, however, most federal criminal law falls into the “public welfare” category, in which a person charged has failed to perform a certain so-called public duty, or has failed to follow a set of rules which often are arbitrarily set up and even more arbitrarily administered. Not surprisingly, we have seen federal criminal law put to an increasing number of political applications. The legal language might be similar to what it was in the past, but now it is describing certain things that might have political meaning, but describe simple disobedience from the federally-prescribed way of doing things.
The irony is that the feds are calling this a huge “fraud,” but the only people really being defrauded are the victims of this federal assault. Let us look at the real damage that the feds have inflicted upon people:
- A thriving business has been shut down, and hundreds of people now are out of work, and a town is reeling economically and financially;
- A woman will be deprived of her husband for many years, and a number of children will not have a father;
- First Bank was heavily damaged by this action in a way that never would have been the case had the feds not decided to “rescue” the bank from its “fraudulent client;”
- Kosher meat is more expensive and much less available than it was before the government destroyed Glatt.
Literally, thousands of people were harmed by what the government did. However, no one from the federal government lost a dime.
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