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November 12, 2013

"3D Printing -- It Really Exists" by Tracy J. Weinstein

3D Printing -- It Really Exists

by Tracy J. Weinstein

3D printers used to be a commodity comparable to time machines. They were something we fantasized about. They were something we imagined only our kids' kids would have a chance to see materialize. Yet here we are today in 2013, with full capability to purchase 3D printers as both manufacturers and average consumers. A 3D printer can be delivered to your home in days with the click of a mouse (and, of course, some credit card information).

The Process

The 3D printing process, originally developed in 1984 by Chuck Hull, may be used in various industries, including architecture, construction, civil engineering, the military, dentistry, medicine, biotech, and fashion. Angela Moscaritolo, Woman Receives a 3D Printer-Created Transplant Jaw, PCMAG, Feb. 6, 2012. The process of 3D printing, also known as additive manufacturing, lays materials down layer by layer to produce a physical object. Id. The printer may use materials ranging from plastic, metal, ceramic, and glass, to cheese, icing, and chocolate. Id. The material of choice is placed on a build bed or platform. The printer then reads virtual blueprints from computer aided design (CAD) and creates cross sections to use as a guideline in making the object.


Some use the printers for personal enjoyment. Take Jay Leno, for instance. He uses a 3D printer to make customized parts for his collectible cars. Brad Hart, Will 3d Printing Change the World, FORBES, Mar. 6, 2012.

Others are using the printers to advance in their professional fields and provide safer and more efficient medical treatment. Last June, an 83-year-old woman in the Netherlands received a lower jaw transplant created from a 3D printer. Doctors chose not to do reconstructive surgery because of the risks at her age. Even though design of the jaw was complex due to cavities and grooves within it, printing only took a few hours. The surgery itself was also shortened since the implant fit perfectly to the patient. See Transplant Jaw Made By 3D Printer Claimed as First, BBC, Feb. 6, 2012.

Along similar lines, a company known as Bespoke Innovations is in the process of mastering the creation of prototypes of limbs for wounded members of the Armed Forces. The limbs would come out of the printer completely assembled and functioning and cost less than other currently used artificial limb replacements. See Hart, Will 3d Printing Change the World, supra.

For companies such as Nike and Adidas, 3D printing reduced the number of technicians and the amount of time required to create prototypes, which they use to test and develop the final product. These models, which used to take four to six weeks to complete, now take about 48 hours. The Vapor Leash Talon is Nike's upcoming cleat, which was created specifically for football players competing and training for the 40-yard dash. It took Nike only six months to go through 12 rounds of prototype iterations and make significant improvements. Peter Ha, Nike and Adidas Are 3D Printing Prototypes At "Impossible" Speeds, GIZMODO, June 10, 2013.

Even professional jewelers are beginning to reap the benefits of 3D printing. Carter Lee, a jeweler in Chicago knows that the jewelry business has never been an easy undertaking since most customers are loyal to their own jewelers, which makes it hard to expand a customer base unless you offer something unique. However, he can now create rare charms using 3D printing. This new method outshines the previous subtractive manufacturing methods, which were used to make charms because it can create a single, unbroken object in one pass. This saves time, material, and labor. For example, a fortune cookie charm was easily created despite the folded geometry intricacies of such a design. Chicago Charm Company - A 3D Printed Jewelry Success Story, 3D PRINTING INDUSTRY, Aug. 23, 2013.

Where the Law Comes In

The benefits of each of these scenarios are quite obvious. Manufacturers and entrepreneurs are saving time and money, patients are receiving better and more personalized care, and the population in general has an remarkable new gadget, which is fun for all ages. But with such advanced technology comes the potential for legal issues. The problem is that users risk illegally creating objects in the face of protected intellectual property, such as patented and copyrighted material. As of now it is not entirely clear how much 3D printing will affect protected intellectual property, but there is much about which to speculate.


Under federal law, whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of the title. 35 USC § 101 (2013). To qualify as new (also called the novelty requirement), the invention must not be "prior art," or publicly known. To be useful, the invention must have a practical application. To be non-obvious, the invention must not have been obvious to a person with ordinary skill in the relevant art. Dicksten Shaprio LLP, Intellectual Property Primer: Patents, Trademarks, Copyrights, and Trade Secrets - An Introduction to Intellecutal Property for In-House Counsel 11 (Ass'n of Corporate Counsel, 3d ed. 2008) If the Patent Trademark Office approves that each of these requirements have been met, a patent will be granted. Once something is patented, any unauthorized use of an invention is considered infringement, even if it is unintentional. See 35 U.S.C. §271 (2013).

There are three possible routes of patent infringement: (1) liability for one who "makes, uses, offers to sell, or sells any patented invention"; (2) liability for one who "actively induces infringement of a patent"; and (3) one who "offers to sell or sells . . . a component of a patented machine, manufacture, combination or composition, or a material apparatus for use in practicing a patented process, constituting a material part of the invention." 35 U.S. C. § 271(a); 35 U.S. C. § 271(b); 35 U.S. C. § 271(c).

To put this in terms directly applicable to 3D printing, a user may make a design that infringes on an already existing patent and make this widely available as a digital design file. Users can replicate the patented object since the printer gives them the capability of turning these designs into the physical objects, which enables widespread patent infringement similar to the copyright infringement we have seen in the music industry. See Davis Doherty, Note, Downloading Infringement: Patent Law As A Roadblock to the 3D Printing Revolution, 26 HARV. J. LAW & TECH 353 (2012).

How Patent Issues Play Out in the Real World

With the current trend in DIY (do it yourself) crafts and creating, 3D printers have every implication of being a huge success on the market. However, the convenient ability to print objects or tools gives rivals the capability to capitalize on exploding trends while they are still hot. For instance, last summer, children all over started wearing colorfully patterned bracelets made from small rubber bands. These bracelets are crafted using a loom to create the designs and a special c-shaped clasp, which connects the final product into a bracelet. The original creator of this craft has recently sued another company for trade dress infringement of the "c" clasp.

Besides trade dress infringement, patent owners of fad products have expressed similar fears that 3-D printing will create a fast and easy way for others to illegally get in the game. Sarah E. Needleman & Adam Janofsky, Patent Fight Erupts Over Kids' Fad, WALL ST. J., Sept. 11, 2013. The 3D printing process would help them replicate the protected intellectual property, which is used to produce the popular final product. The efficiency of the printing would allow them to get in the business while the trend is still prevalent, taking much business away from those who originally worked to design, create, and produce the product or who are licensed to used such intellectual property.


Copyright protects artistic, creative works from the moment they are written down, painted, sculpted, etc. Michael Weinberg, What's the Deal with Copyright and 3D Printing?, PUBLIC KNOWLEDGE, Jan. 29, 2013. Unlike patents, one need not register to have copyright protection. Generally, courts apply a "severability" test in determining whether a particular object can be copyrighted. This test weighs whether you can "sever" the artistic part of the object from the useful part. If so, the artistic part is protected by copyright. John Paul Titlow, Why 3D Printing Will Be the Next Big Copyright Fight, READWRITE, Feb. 20, 2013. Basically when someone copies an original work of art, this constitutes infringement, subject to independent authorship or subconscious copying.

Directly applying this to the 3D printing world, copyright infringement is most likely to occur through the use of CAD files, which can easily be distributed over the internet. To qualify for copyright protection the CAD files must have been created from scratch or modified by a person from a pre-existing CAD file. John Hornick, Some Thoughts on Copyright and 3D Printing, 3D PRINTING INDUSTRY, Sept. 13, 2013.

How Copyright Plays Out in the Real World

The benefit of CAD is that it enables a user to tweak the design to his or her specific preferences. See Hart, Will 3d Printing Change the World, supra. Moreover, users will find it convenient that once the CAD design exists it can be easily distributed, just like any other computer file. Michael Weinberg, It Will Be Awesome If They Don't Screw It Up, 3D Printing, Intellectual Property, and the Fight Over the Next Great Disruptive Technology, PUBLIC KNOWLEDGE, November 2010. One can create a design in New York and then send the design file to a friend across the country that can then use that design to print the same exact object. Since the majority of the population is not familiar with CAD, the utility of 3D printing will depend on access to already made designs through online collections such as Shapeways and Thingiverse. See Doherty, supra. And of course the downside to this convenience is running the risk of copyright infringement.

Just the Beginning

Pirate Bay, an illegal download website, has jumped on the new opportunity by enabling people to download physical object models called Physibles. Hart, Will 3d Printing Change the World, supra. These models are infringements on copyright and patents of all sorts. To avoid illegal downloading of models and to encourage legal sharing, some experts hope for something similar to iTunes where users can purchase the CAD designs for various objects. Otherwise, there is much potential for infringement and chances of a huge detriment to retail stores and manufacturers.

So far, take-down notices have been successful in halting infringement. For example, HBO recently sent a take down notice to a maker site that posted a file containing instructions on how to print a phone charging dock that is shaped like the iron throne from the "Game of Thrones" TV series. Thomas Mahlum & Melissa Goodman, Technology: Will the Digital Millenium Copyright Act Takedown 3D Printing?, INSIDE COUNSEL, Aug. 30, 2013. Similarly, Thingsverse took down a design for figurines based on Games Workshop's Warhammer game. Although the individual who posted the design was not reluctant in removing the design, the "maker" community protested the take down. As of now it seems that take down notices are proving to be useful, but what about when someone is able to get the design before it is taken down and decides to print that design in mass quantities?

Bells ring back to the early days of music file sharing. It seemed easy to shut down illegal music sharing sites at the beginning. Then as it became popular there were just too many individuals illegally downloading to catch everyone. Eventually some artists started releasing their music for free with an entirely new philosophy on the music market and free sharing.


It is tempting to speculate that the same might happen with 3D printing. Patent infringement litigation can by very costly since battles between inventors and alleged infringers involve arguing over each element of the patent. See Bryan J. Vogel, Casting 3D Printing's Coming IP Litigation: Usual Suspects and Dark Horses, BLOOMBERG LAW (2013). Part of the problem for patent holders is that they are the ones bearing the burden of proving appropriate equitable relief and/or the monetary damages suffered. Id. Some commentators on the topic believe that litigation will only occur when copying reaches a commercial scale. See id. This theory seems to parallel what happened in the music industry. Since a large appeal of 3D printing is the online accessibility to the CAD designs, it is likely copying will reach that commercial scale for both, design file sharing and printing of patented products. For now the best we can do is speculate and admire that 3D printing has become a reality in our lifetime.

Tracy J. Weinstein is in her third year at New York Law School. She completed her undergraduate studies at Binghamton University, where she also played Division I Women's Lacrosse. She is currently in NYLS's Intellectual Property Job Track for Fashion Law and has contributed to NYLS's Fashion Law blog, Case Clothesed. Tracy has competed at the ABA Regional Negotiation Competition for the past two years. She wishes to thank Professor Joseph Forgione for his consistent mentorship and support.

"Creating A Suitable Standard: Why Brokers Should Be Fiduciaries" by Nicholas M. Herubin

Creating a Suitable Standard: Why Brokers should be Fiduciaries

Nicholas M. Herubin

I. Introduction

For the average investor, making sense of the financial world is a daunting task. The financial products available to ordinary people are constantly becoming more complex. See, e.g., These Financial Products are too Complex for the Average Joe, INVESTOPEDIA, Nov. 13, 2009 (describing some of the complex products available to the public and providing investors with techniques to evaluate investments). There is a seemingly endless amount of information available to consider before making an informed decision. See, e.g., Financial Navigating in the Current Economy: Ten Things to Consider Before You Make Investing Decisions, SECURITIES AND EXCHANGE COMM'N (providing investors with a list of factors to consider before selecting a particular investment). At the same time, a decreasing number of Americans will be able to rely on a defined benefit retirement plan. Barbara A. Butrica, Howard M. Iams, Karen E. Smith & Eric J. Toder, The Disappearing Defined Benefit Pension and Its Potential Impact on the Retirement Income of Baby Boomers, SOCIAL SECURITY ADMIN. (2009)(describing the "steadily declining" number of Americans covered by a defined benefit plan). This means that individual investors have to make serious decisions that will shape their financial wellbeing for the rest of their lives. Id.

For many, guidance from a financial professional is a critical part of that decision making process. TIAA-CREF Survey, available at https://www.tiaa-cref.org/public/about/press/about_us/releases/articles/pressrelease436.html. These professionals act as intermediaries between the investing public and the financial world. Many people go to the local office of a brokerage firm and hire a financial professional to help them choose investments that will help them pay for their children's college education or eventually retire.

Most investors likely assume that the professional they hire is looking out for their best interests. At many firms and with many brokers, that is likely the case. However, under the current regulatory regime, most financial professionals owe surprisingly few legal obligations to their customers. The current regulations do not go far enough to ensure that investors are getting unbiased advice from professionals acting without conflicts of interest. Expanding the fiduciary standard to brokers is a necessary step to provide adequate protection for retail investors.

II. The Fiduciary Standard & Financial Professionals

A fiduciary relationship creates an obligation for a person to act in the best interests of another person. BLACK'S LAW DICTIONARY (9th ed., 2009), fiduciary (defining fiduciary as "a person who is required to act for the benefit of another person..."). It sets extremely high standards of behavior for the fiduciary. In the context of a financial professional and a client, a fiduciary duty provides clients with a high level of protection from misconduct by the professional. The advisor must put the client's best interests first and avoid conflicts of interest. SeeInvestment Advisors Act § 206(3). The advisor must act with prudence, which requires acting with the care, skill, and diligence of a professional. Five Core Principles, COMM. FOR THE FIDUCIARY STANDARD, http://www.thefiduciarystandard.org/about-us. Finally, the advisor must never actively mislead the client. Investment Advisors Act § 206(1).

The fiduciary duty aligns the interests of the advisor with those of the client in a powerful way. It creates a relationship similar to that of a lawyer and a client or a doctor and a patient. Importantly, if a dispute arises between a customer and a financial professional with a fiduciary relationship, the burden is on the financial professional to show that he or she actually acted in the customer's best interest. See Why is the fiduciary standard vital?, COMM. FOR THE FIDUCIARY STANDARD, http://www.thefiduciarystandard.org/about-us. In the case of a non-fiduciary financial professional, the burden is on the customer to show that the professional acted improperly. Id.

Under federal securities laws, "investment advisors" registered under the Investment Advisors Act of 1940 owe their customers a fiduciary duty. Investment Advisors Act § 206. Broker-dealers do not. Investment Advisors Act § 206. While this may seem like semantics, it is the reason why most retail investors do not have a fiduciary relationship with the men and women giving them investment advice.

III. The Investing Public's Misconceptions

This is a serious problem because investors tend to believe that the financial professionals they hire are obligated to act in their best interests. Yet, studies show that most investors do not actually understand what legal duties their financial professionals owe to them. In 2010, a study asked 1,319 American investors who they believed owed them a fiduciary duty. INFORGROUP/ORC, U.S. INVESTORS AND THE FIDUCIARY STANDARD: A NATIONAL OPINION SURVEY (2010), available at http://www.thereformedbroker.com/wp-content/uploads/2010/09/stockbroker-advisory-survey.pdf. The results show that there is widespread confusion. More than 75% of those polled incorrectly believed that financial advisors and planners owe fiduciary duties to their clients. Id. Two out of three believed that stockbrokers have a fiduciary duty and 60% think investment advisors are the same as stockbrokers. Id. Over half believed that insurance agents owe customers a fiduciary duty. Id.

Several factors make it difficult for the average investor to understand who owes him or her a fiduciary duty. First, consider the fact that a single institution or even a single employee can act in multiple capacities. Take, for instance, an ordinary trip to a bank branch. It can actually become quite complex. A customer would start by dealing with a teller (a transaction that would be well-protected up to $250,000 by the Federal Deposit Insurance Corporation). See Who is the FDIC?, FEDERAL DEPOSIT INSURANCE CORP., http://www.fdic.gov/about/learn/symbol/. If the teller sees that the customer has a lot of money in a low-interest account, the teller might refer the customer to a broker sitting at a desk right across the branch. See, e.g., Bank Tellers , OCCUPATIONAL OUTLOOK HANDBOOK, http://www.umsl.edu/services/govdocs/ooh20002001/120.htm (describing as a job duty of tellers learning about the bank's "various financial products and services the bank offers, so they can briefly explain them to customers and refer interested customers to appropriate specialized sales personnel"). The broker would likely work for the bank's broker-dealer subsidiary. ANJALI KUMAR, THE REGULATION OF NON-BANK FINANCIAL INSTITUTIONS, 20 (1997).

Thus, to customers, it is not necessarily obvious that in a few short steps they are leaving the insured, highly regulated banking world and entering much riskier territory. That type of rapid transition within one financial entity complicates customers' perception of who is handling their money.

In addition, the variety of titles firms give to their employees adds to the confusion. "Broker", "financial planner", "financial advisor" and "wealth manager" are all synonymous with the securities law term of art "broker." Difference Between Brokers and Investment Advisors, BROWN WEALTH MGMT., Dec. 12, 2012. The different terminology from one brokerage to another makes it more confusing for investors.

Barbara Roper, the director of Investor Protection at the Consumer Federation of America, has said, "The lack of understanding is not because investors are stupid. It's because the policy itself is stupid." Mark Schoeff, Most Investors Think Brokers are Fiduciaries, Survey Says, INVESTMENT NEWS, Sept. 15, 2010. Retail investors by definition are not financial professionals. They lead busy lives beyond trying to figure out who owes them a fiduciary duty and who does not. Concern about the legal obligations of stockbrokers seems rather likely to fall behind matters like work, mortgage payments, and kids on the average person's list of concerns. Add to that the fact that the term "fiduciary duty" is, as the New York Times puts it, "a term so dry that your eyes may be glazing over as you read this." Tara Siegal Bernard, Will You Be My Fiduciary?, N.Y. TIMES BUCKS BLOG, Feb. 16, 2010. Without knowing the legal mechanics of the relationship, the typical investor reasonably believes that the person on the other end has the investor's best interests in mind. Unfortunately, that is not necessarily the case.

IV. Broker Conflicts of Interest

In many instances, it would be better for investors to think of their brokers more like a salesperson than a disinterested advisor helping them select smart investments. Brokers' training often focuses more on sales tactics rather than choosing financial products tailored to a particular customer's needs. Tara Siegel Bernard, Trusted Advisor or Stock Pusher?, N.Y. TIMES, Mar. 3, 2010, at B1. As one former Merrill Lynch broker said, "I learned a lot about being a good salesman at Merrill. The amount of training I sat through to properly evaluate investment opportunities was almost non-existent relative to the training I got on how to sell them." Id. Brokers know that making sales is a key part of their job description.

Once a customer hires a broker, the obligations of the broker are remarkably limited. Financial Industry Regulatory Authority ("FINRA") Rule 2111 requires that a broker "have a reasonable basis to believe that a recommended transaction or investment strategy involving a security or securities is suitable for the customer." FINRA Rule 2111.

The "suitability" requirement is a logical rule, but not a particularly high standard. It functions somewhat like a "rational basis" test for brokers: as long as there is plausibly a legitimate reason for the recommendation, the broker has met the standard. Trusted Advisor or Stock Pusher?, supra, at B1. One financial planner told The New York Times, "Under suitability, advisors would willy-nilly buy and sell investments that were the flavor of the month and make some infinitesimal case that they were somehow appropriate without worrying." Id. In addition, the suitability rule only applies when a broker is "recommending" a product to a customer. See FINRA Rule 2111. It does not create any duty for the broker to talk a customer out of an investment the investor thinks of, regardless of how clear it may be to the broker that the investment is a bad idea. Frequently Asked Questions: FINRA Rule 2111, FINRA. "The suitability rule applies only to recommended securities and investment strategies involving securities...". Id. Therefore, by avoiding making a "recommendation", the broker can avoid the suitability rule altogether. Id.

There are other FINRA broker rules to protect customers, but they provide only a minimal layer of protection. For example, brokers cannot "churn" their clients' accounts. FINRA Conduct Rule IM-2310-2. "Churning" refers to selling and purchasing securities repeatedly to generate brokers' fees for the trades. Churning, INVESTOPEDIA, http://www.investopedia.com/terms/c/churning.asp. Brokers also must get the "best execution" when executing a trade on a customer's behalf. FINRA Regulatory Notice 12-13. This means that a broker must get the customer the best price for a customers' trade in a short timeframe. Best Execution , INVESTOPEDIA, http://www.investopedia.com/terms/b/bestexecution.asp. Beyond these, however, there are very few rules in place to protect investors who are dealing with a non-fiduciary financial professional.

This creates a problem because there is widespread potential for broker conflicts of interest. One of the most obvious conflicts of interest can arise when a broker's pay is on a per-transaction basis rather than a fee for managing investors' assets. The broker's interest then becomes maximizing the number of transactions rather than giving quality advice. Christopher Traver Robinson, Biased Advice , 60 EMORY L. J. 653, 675 (2011) (discussing how brokers can become incentivized to trade frequently and generate fees). While the rules against churning prevent extreme cases of excessive trading, brokers with this type of fee arrangement still have a strong incentive to produce a high number of trades. Id.

Another conflict that can arise for brokers is the opportunity to steer clients towards products that will maximize their own fees. Robert A. Prentice, Moral Equilibrium: Stock Brokers and the Limits of Disclosure , 2011 WIS. L. REV. 1059, 1062 (2011). This can be very profitable for brokers because the amount of fees earned can vary widely from one product to another. For example, brokers generally receive a two-to-three percent commission for investing a customer in a mutual fund. How Investors Get Into Trouble with Annuities, SHEPHERD SMITH EDWARDS & KANTAS LLP, http://www.stockbroker-fraud.com/lawyer-attorney-1136040.html. When they sell a customer an annuity, however, the commission can be as high as ten percent. Id. This can be a huge difference for the broker but does not necessarily reflect the underlying value of the product to the customer.

Regardless of the brokers' fees, as long as a financial product meets the minimal suitability threshold, the broker has no obligation to offer the customer any less costly options. Oftentimes, this can create incentives for brokers to recommend financial products that make little sense for customers. For instance, some brokers have sold clients variable annuities (a tax-deferred product) to put in their 401(k) (a tax-deferred account). Alina Tugend, Pick a Planner Who Can Spell Fiduciary , N.Y. TIMES, Apr. 28, 2008, at G5. The double tax deferral would be useless for the client but the sale would produce a large commission for the broker.

There is also pressure on brokers to sell customers "proprietary products". Find the Right Financial Advisor , INVESTOPEDIA, http://www.investopedia.com/articles/pf/07/rightadvisor.asp. These are the brokerage firm's own financial products. Id. For instance, ABC Brokerage invests a client's money in ABC Mutual Fund. These transactions tend to be very profitable for financial institutions because the entire investment stays in-house. Id. However, they may or may not be the best investment for a particular customer.

Similar to proprietary products, large brokerage firms often have arrangements with outside mutual fund companies called "revenue sharing." Id. The mutual fund pays the brokerage in order to be on a list of "preferred" mutual funds. Id. This creates a conflict between the customer's best interest and the mutual fund paying for the brokerage's stamp of approval. Some firms disclose these agreements on their websites or in paper at the time of the transaction. Ron Lieber, The High (and hidden) Costs of Your 401(k), N.Y. TIMES, June 10, 2011, at B1. Yet that leaves the customer in the odd position of trying to determine whether the brokerage's arrangement with a mutual fund is enough of a conflict of interest to forgo the purchase of the mutual fund.

These are just a few common examples of the types of conflicts of interest that can arise in a broker-customer relationship. Since brokers have no fiduciary duty, they are free to act in their own best interest when there is a conflict. As long as the broker can meet the minimal suitability standard, there is nothing stopping him or her from maximizing profits at the expense of the customer. See Prentice, supra , at 1068 (2011).

V. Recent Developments and Looking Ahead

There have been efforts to go beyond disclosure and actually expand the fiduciary duty to include brokers. The Obama administration attempted to include a heightened standard for brokers in the Dodd-Frank Act. The new rule would have created a duty "to act solely in the interest of the customer or client without regard to the financial or other interests of the broker, dealer or investment advisor providing the advice." Press Release, U.S. Dep't of the Treasury, Additional Improvements to Financial Markets Regulation (July 10, 2009), http://www.treasury.gov/press-center/press-releases/Documents/tg205071009.pdf. In the end, however, Congress did not enact the rule and the Securities and Exchange Commission ("SEC") was directed to merely devise a plan for better disclosures from brokers. Dodd-Frank, Pub. L. No. 111-203 §913 (g). It is still unclear whether this heightened standard will ever be applied.

Surprisingly, there are signs that individual brokers and even some large brokerage firms are not entirely opposed to a fiduciary standard. The brokerage firm TD Ameritrade provides financial support to the Committee for the Fiduciary Standard, a group that advocates for expanding the fiduciary standard. See About Us , COMM. FOR THE FIDUCIARY STANDARD, http://www.thefiduciarystandard.org/about-us ("This year the Committee is proud to recognize TD Ameritrade Institutional, a firm that has spoken out for the fiduciary standard for many years, as a financial supporter of the Committee."). One survey indicates that over half of brokers support an expanded fiduciary standard. A poll of about 900 brokers taken in 2009 by the Committee for the Fiduciary Standard showed that 53% believe that "all financial professionals who give investment and financial advice should be required to meet the fiduciary standard." Thomas Coyle, Poll Indicates Broker Support for Fiduciary Standard , WALL STREET J. WEALTH MANAGER BLOG, Dec. 2, 2009. Only 23% said they were opposed. Id. This would seem to suggest that brokers think that a fiduciary standard would not significantly damage their business. It also shows that most brokers recognize the potential for conflicts and would welcome attempts to avoid them.

However, support within the industry is by no means universal. Some firms and industry groups are vehemently opposed to expanding the fiduciary standard. The Securities Industry and Financial Markets Association ("SIFMA") opposed the Dodd-Frank proposal. SIFMA claimed that the rule would "ultimately harm investors by raising the cost of saving." Position: Fiduciary Standard, SECURITIES INDUSTRY AND FINANCIAL MARKETS ASS'N, http://www.sifma.org/issues/private-client/fiduciary-standard/position/. Instead, SIFMA suggested its own standard, a watered-down definition of "fiduciary" that would take the place of the definition in the Investment Advisors' Act. See id. In addition, groups lobbying on behalf of insurance brokers have put up a particularly strong fight against expanding the fiduciary duty. When the change was proposed as part of Dodd-Frank, they were "apoplectic." Tara Siegel Bernard, Struggling Over a Rule for Brokers , N.Y. TIMES, Feb. 15, 2010, at B1. Observers suggest that this is likely because insurance brokers would have to disclose the huge fees they receive from selling certain products, especially variable annuities. Id.

Critics of the change have raised concerns about an increase in regulations and costs to brokerage firms if brokers were held to a fiduciary standard. Any estimate of the cost of the new rule is necessarily imprecise but it seems likely that there would be some loss of profits for brokerages. It could create a lot more work for brokers and would require them to steer clients towards less profitable products. It also seems possible that the cost of financial advice could go up if brokers were fiduciaries. One analyst who covers the securities industry says that big firms could stand to lose as much as 7% of their revenue. Id. To a firm like Morgan Stanley Smith Barney, that could mean as much as $300 million annually. Id. Yet an increase in costs is not a compelling argument against requiring brokers to act in their customers' best interests. If anything, it highlights how much profit brokerages apparently derive from transactions that are not in their customers' best interests.

Today, two trends are creating the need for stricter regulation of brokers. First, the stakes for individual investors are higher than ever. Most employees can no longer rely on a professionally managed pension plan to fund retirement. This means that people have to make more of their own investment decisions. The second trend is the increasing complexity of the financial markets. Years ago, an investor was likely to do fairly well with a portfolio of blue chip American companies. Today, there are many more products to consider: exchange traded funds, mutual funds, annuities, etc. There are also new factors to consider in diversifying (i.e. emerging markets). These two developments make it more important than ever that average investors have access to quality financial guidance. This means unbiased, personalized advice from a professional free from conflicts of interest. The best way to ensure that is to expand the fiduciary duty to brokers.

Perhaps the SEC or Congress will put a broker fiduciary duty in place eventually. There is also the potential for FINRA, the industry self-regulatory organization, to require its members to meet the fiduciary standard. However, unless the rule changes, the responsibility will remain with investors to educate themselves and be aware of whether their broker is truly acting in their best interests.

Nicholas Herubin is a graduate of Albany Law School Class of 2013. While at Albany Law, he worked at the school's Securities Arbitration Clinic, learning about the serious issues facing ordinary investors. He was also a member of the Albany Government Law Review and had an article published about New York State's economic development programs. He would like to thank Professors Joan Stearns Johnsen, James Redwood, and Christine Sgarlata Chung for their help with learning about securities and financial regulation.

November 13, 2013

"The Stockbridge-Munsee Casino Proposal And The Potential For An Economic Turnaround In Sullivan County" by Benjamin Kern

The Stockbridge-Munsee Casino Proposal And The Potential For An Economic Turnaround In Sullivan County

by Benjamin Kern

History of the Stockbridge-Munsee Mohican Tribe:

The Stockbridge-Munsee Tribe is a band of the Mohican Indian Nation. An understanding of their history, the circumstances of their arrival in New York State, and the Tribe's subsequent departure are important when examining the present-day land disputes surrounding the Sullivan County casino proposal.

The tribe originated in Massachusetts, but was forced to move shortly after the Revolutionary War when they lost their land to white settlers due to a series of unfair land deals. During the revolution they had befriended the Oneida tribe in New York after Indian tribes that were allied to the British burned their villages. After the war, the Oneida tribe rewarded the Stockbridge-Munsee Tribe with a township in what is today Madison County, New York.

By 1785, the majority of the Stockbridge tribe, at the time approximately 280 individuals, had made the move from Massachusetts to New York. Once established in Madison County, the tribe became committed to the Christian faith, established schools and other municipal buildings, and spread the faith to nearby tribes. Throughout the remainder of the 18th century, the tribe and the State had a cooperative, constructive relationship, with the tribe agreeing to abide by many laws passed by the state legislature during the period, and the state likewise providing resources for the tribe. The Stockbridge Tribe also maintained peaceful relations with the Oneida tribe during the period, from whom they resided only five miles away. Lion J. Miles, 1784-1829 - Part 1 - Establishing a Town, STOCKBRIDGE-MUNSEE COMMUNITY; BAND OF MOHICAN INDIANS, http://www.mohican-nsn.gov/Departments/Library-Museum/Mohican_History/1784-1829-part1.htm.

As the Stockbridge-Munsees entered the 19th century, the problems that would ultimately compel their departure from New York began to rear their heads. The first of these issues was the presence of alcohol and its affect on the tribe. Throughout the late 18th century, tribal leaders undertook steps in order to reduce the presence of alcohol, most notably rum, on tribal lands. Tribal leaders traveled to Albany throughout this period to appeal for strong laws forbidding the sale of liquor to the tribes, and ultimately were successful in 1800 when the state legislature passed an act prohibiting the sale of rum, brandy, gin, or spirits in the Mohican and Oneida lands. During this stretch of time when the fist signs of trouble were beginning to appear, more and more Mohicans from surrounding areas were nonetheless migrating to Madison County where the Stockbridge Indians were living. This migration, along with increased birth rates in the Tribe had brought the population of the Stockbridge-Munsees in New York to approximately 500 in 1816. Id.

The second major problem that began to foreshadow the tribe's departure from New York was the influx of white settlers from eastern parts of the state. After the Revolution, New York State offered bounty lands to war veterans, many of who then sold their rights to land speculators who as a result gained large tracts of real estate in areas surrounding the Stockbridge Tribe. Additionally, during the late 18th and early 19th century, New York began focusing on developing a modern transportation system. Construction of the Genesee Road was authorized in 1791 from Utica to the Genesee River running just north of the Stockbridge Tribe, and the Erie Canal, which was built between 1819 and 1825, allowed for massive economic and demographic expansion in the region. The combination of large tracts of available land and the emergence of modern transportation resulted in a population boom in the region over the early part of the 19th century. The population of Madison and Oneida Counties grew from 1,900 in 1790 to 93,000 in 1825. See Lion J. Miles, 1784-1829 - Part 2 - Pressures on the Tribe , STOCKBRIDGE-MUNSEE COMMUNITY; BAND OF MOHICAN INDIANS, http://www.mohican-nsn.gov/Departments/Library-Museum/Mohican_History/1784-1829-part2.htm.

Mindful of their experience with white settlers in Massachusetts, and having watched neighboring tribes - including the Oneidas - lose massive tracts of land to white speculators, the Mohican leadership and the Stockbridge Tribe successfully stood fast against leasing their land. However white settlers began to surround the tribe, and the increased availability and temptation of liquor, combined with a blatant disregard of the law passed in 1800 banning the sale of liquor to Indians, was taking an increasing toll. Eventually the tribe began to lease their land, starting with small portions to be rented off in order to pay for schools and other municipal needs. Soon after, the Tribe began selling increasing portions of their land to white settlers. By 1818, the Stockbridge Tribe had leased or sold more than 1,800 acres to white settlers and were only seeing the beginnings of the heaviest pressure to relinquish their land. By this time, many of the tribal leaders were beginning to feel that the time to leave New York for open land in the west had come. Id.

One of the tribe's leaders had spent time on the White River in Indiana during the first decades of the 19th century, hoping to obtain a permanent land tract there for the resettlement of the Stockbridge Tribe. When he returned to New York in 1815, he had secured land from tribes in Indiana for relocation of the Stockbridge-Munsees, and many of the tribe's families began preparing for a move westward. In order to raise money for the move, the tribe began a series of land sales with New York State. In August of 1818 approximately 60 to 70 Indians, about one quarter of the tribe, departed for a new life in Indiana. When the tribe arrived at the White River they found that the Delaware and Miami Tribes, who had previously promised the land to the Stockbridge Indians, had since sold the land to the United State Government at the Treaty of St. Mary's. The Tribe petitioned the federal government for the reinstatement of their Indiana lands, and in 1821 the United States paid the Tribe $2,000 in return for the relinquishment of their claim to the White River lands. See Lion J. Miles, 1784-1829 - Part 3 - The Tribe Leaves New York , STOCKBRIDGE-MUNSEE COMMUNITY; BAND OF MOHICAN INDIANS, http://www.mohican-nsn.gov/Departments/Library-Museum/Mohican_History/1784-1829-part3.htm.

After the Stockbridge Tribe's debacle on the White River, tribal leaders formed a delegation to travel to Green Bay with the objective of obtaining new land from the Menominee and Winnebago tribes in what is present-day Wisconsin. In August of 1921 they purchased two million acres along the Fox River. At this point the tribe began to sell their New York lands in earnest with the goal of permanently relocating to Wisconsin. The money earned from the sales was used to finance the move, and tribal members began to depart New York in waves. A group of 30 reached Green Bay in the summer of 1824, and another 50 left New York in 1825. By the 1840s, only one or two Stockbridge Indian families remained in New York, with the last land sale taking place in 1847, thus closing the final chapter of the Stockbridge Tribe's presence in New York. Id.

Legal History of Indian Gaming:

Any discussion of the legal issues surrounding Indian gaming should begin with a focus on the Indian Gaming Regulatory Act (IGRA), the main statute governing Indian gaming today. IGRA was enacted in 1988 in response to the United States Supreme Court decision in California v. Cabazon Band of Mission Indians. In that case, the Cabazon Band, a federally recognized band of Indians, sought declaratory and injunctive relief against the California County in which their reservation was located from enforcing gambling ordinances. The tribe was conducting bingo games pursuant to an ordinance approved by the Interior Department, as well as card games on the reservation. These games were a major source of employment for the tribe as well as their only source of income. The State of California intervened seeking to apply its own regulations of bingo games under state law.

In affirming the relief granted to the tribe in district court, the Supreme Court held that the laws of the state and county were preempted since the asserted state interest in preventing infiltration of the tribal games by organized crime was insufficient to escape the preemptive force of the federal and tribal interests in Indian self-government, including the goals of encouraging Indian self-sufficiency and economic development. Kurtis A. Kemper, Annotation, Preemption of State Law by Indian Gaming Regulatory Act, 27 A.L.R. Fed. 2d 93 (2008). The holding created a broad rule that if the state law's intent is to prohibit conduct, the law is thus criminal, and as a consequence the state may regulate conduct on Indian lands. However if the law is instead regulatory in nature - merely regulating conduct while providing separate criminal sections when the law is violated, the court held such laws do not permit a state to extend its enforcement powers to an Indian reservation. Because California's bingo statute merely regulated conduct it could not be legally enforced against the tribe. California v. Cabazon Band of Mission Indians, 480 U.S. 202, 107 S. Ct. 1083, 94 L. Ed. 2d 244 (1987).

IGRA created three different regulatory schemes for three different classes of gaming, identified as Class I, Class II, and Class III gaming. Class I gaming, which encompasses social games for prizes of minimal value and traditional forms of Indian gaming connected with tribal ceremonies or celebrations, is beyond the reach of both federal and state regulation. Class II gaming, which encompasses bingo and certain card games, can be regulated on Indian lands by states only if those games are prohibited for everyone under all circumstances. Class III gaming, which covers the major forms of gambling seen in typical casino settings (craps, roulette, and banked card games such as blackjack and slot machines) is the only avenue for significant state involvement in Indian gaming under IGRA. Id. IGRA states that class III gaming is lawful on Indian lands only if such activities are: (1) authorized by an ordinance or resolution of the Indian tribe, (2) located in a state that permits such gaming for any purpose by any person, organization, or entity, and (3) conducted in conformance with a tribal-state compact entered into by the tribe and the state. Indian Gaming Regulatory Act, 25 U.S.C.A. § 2710(d)(1)(1988).

The third provision involving the tribal-state compact is the key provision Congress created in order to balance the competing interests of the federal government, states, and the tribes. A tribe seeking to conduct class III gaming on their land must request that the state negotiate with them in order to develop a tribal-state compact. The state must negotiate in good faith to develop a tribal-state compact, and any compact agreed to is subject to approval by the National Indian Gaming Commissioner - the head of the National Indian Gaming Commission, an independent federal regulatory agency within the Department of the Interior created by the Act. By allowing to states to get involved in the compacting negotiations, IGRA allows states to have input into how class III gaming will be conducted.

However, if the state refuses or fails to negotiate in good faith, a tribe can circumvent the state by bringing suit in federal court. In federal court the parties are ordered to conclude a compact within a 60-day period, and if the parties do not agree to a compact, mediation is required. At that point if the state still does not agree to negotiate in good faith or invokes its 11th Amendment immunity, the negotiation process will exclude the state, and the Secretary of the Interior and tribe will decide upon procedures for conducting class III gaming. See Kemper, supra, at 93.

The provision of IGRA most applicable to the Stockbridge-Munsee Tribe's land claims in New York and their Casino aspirations involve section 2719 of the Act: gaming on lands acquired before October 17, 1988. Indian Gaming Regulatory Act, 25 U.S.C.A. § 2719 (1988). This provision establishes a general prohibition against gaming on lands acquired by the Secretary of the Interior in trust for the benefit of an Indian tribe after October 17, 1988. The provision does not apply if the lands are located within or adjacent to the boundaries of an already existing reservation, if the lands are in Oklahoma (and satisfy particular requirements), or if the lands are within the particular tribe's last recognized reservation within the State. Id.

However, the two main exceptions are found in subsection B of section 2719 of IGRA. The first of these exceptions is known as the "two-part determination" and provides that the prohibition on gaming will not apply if "the Secretary (of the Interior), after consultation with the Indian tribe and appropriate State and local officials, including officials of other nearby Indian tribes, determines that a gaming establishment on newly acquired lands would be in the best interest of the Indian tribe and its members," and "would not be detrimental to the surrounding community, but only if the Governor of the State in which the gaming activity is to be conducted concurs in the Secretary's determination." Id. (emphasis added). The successful utilization of the "two-part determination" exception has been limited, however. The exception has succeeded only five times resulting in three casinos, and in the eight-year period of the Bush administration there were only two approvals total.

The second main exception, which applies directly to the current Stockbridge-Munsee situation in New York, provides that the prohibition on gaming will not apply if "lands are taken into trust as part of - (i) a settlement of a land claim, (ii) the initial reservation of an Indian tribe acknowledged by the Secretary under the Federal acknowledgment process, or (iii) the restoration of lands for an Indian tribe that is restored to Federal recognition." Id.

There are two further legal developments, one administrative and one at common law, that must be addressed in order to give a complete picture of the current legal framework of Indian gaming. The first is the issue of "commutability," which was a de facto policy adopted by the Bureau of Indian Affairs in a 2008 memo which stated that tribes could develop casinos on land off their reservations only if it was within "commutable distance." The term "commutable distance" was not defined in the memo, however in testimony to Congress, Bureau of Indian Affairs officials indicated that 40 miles was the farthest a tribe could go from its reservation in developing an off-reservation casino. The day after the memo was issued the Bureau rejected 11 off-reservation casinos, including the St. Regis Mohawk Tribe who was in the final stages of approval for their own Catskill casino project. However in 2011, Assistant Secretary of Indian Affairs Larry Echo Hawk, also the head of the Bureau of Indian Affairs, rescinded the 2008 memo, ending the strict commutability rule. See Gale Courey Toensing, Bush-Era Commutable-Distance Gaming Rule Nixed , INDIAN COUNTRY TODAY MEDIA NETWORK, Jan. 19, 2011.

The final development, which unlike the commutability issue is still a very relevant and substantial focal point in Indian gaming law, is the consequences of the Supreme Court's ruling in Carcieri v. Salazar . 555 U.S. 379, 129 S. Ct. 1058, 172 L. Ed. 2d 791 (2009). The Court in Carcieri held that to qualify for the benefits of Section 5 of the Indian Reorganization Act (IRA), which authorizes the Secretary of the Interior to acquire and hold land in trust for the purpose of providing land for Indians, tribes must show they were under federal jurisdiction at the time the IRA was enacted in 1934. See generally Sarah Washburn, Distinguishing Carcieri v. Salazar: Why the Supreme Court Got It Wrong and How Congress and Courts Should Respond to Preserve Tribal and Federal Interests in the Ira's Trust-Land Provisions, 85 WASH. L. REV. 603 (2010).

In other words, the Court held that if a tribe was not federally recognized before the IRA was passed in 1934, that tribe does not qualify to have the federal government take land into trust for it. The obvious consequence of the Carcieri decision is that because tribes recognized after 1934 cannot have the federal government take land into trust for them, pursuant to Section 2719 (discussed above) which requires the Bureau of Indian Affairs to take land into trust to authorize off reservation gambling, these tribes cannot build casinos off their reservation. Since the Carcieri decision in 2009, there has been considerable discussion about Congress passing a "Carcieri Fix" to remedy this limitation written into the statute by the Court. However, this fix has not yet happened, and because of competing interests both within the Indian gaming community and the gambling industry generally, it is uncertain whether Congress will take action.

Stockbridge-Munsee New York Land Claims and Casino Proposal:

Today the Stockbridge-Munsee tribe calls Bowler, Wisconsin, home - where its 22,000-acre reservation is located. The tribe owns and operates a successful casino called the North Star Mohican Resort Casino on their reservation in Wisconsin. The tribe has long held a land claim to 23,000 acres in Madison County where they resided in the late-18th and early-19th century after leaving Massachusetts and before their departure to Wisconsin. The land claim is based on New York's acquisition of the lands, which have been ruled as unconstitutionally acquired from the tribe without United States Senate ratification. Gale Courey Toensing, Seneca Upset Over N.Y. Casino Agreement , INDIAN COUNTRY TODAY MEDIA NETWORK, Jan. 26, 2011.

In November 2010, during the waning days of Governor Paterson's administration, the Administration, Tribe, Madison County, and the Town of Stockbridge brokered a deal settling the claims in New York. The land claim settlement agreement ended the Stockbridge-Munsee's claim over the 23,000 acres of land in Madison County by transferring rights to 1.84 acres of land in Madison County, and 330 acres of land in Sullivan County to be conveyed to the Federal Government, thus allowing the land in Sullivan County to be taken into trust on behalf of the Tribe. Press Release, Executive Chamber Governor David A. Paterson, Governor Paterson Announces Land Claim Settlement Agreement , Nov. 22, 2010.

The deal also provided for the development of a Class III gaming complex on the land to be taken into trust in the Town of Thompson, which would include a hotel, restaurants, and retail outlets. The project was predicted to generate more than $1.3 billion in economic activity during the construction phase, and once operational - had projections of $900 million in revenue annually for the State economy. The gaming complex was also estimated to create over 6,700 direct and indirect jobs for the region. In additional to the provisions above, the Tribe agreed to comply with all requirements of a law passed by the State Legislature in 2001 authorizing up to three Indian casinos in the Catskills, which included the payment of 25 percent of slot revenue to the State. The Tribe also entered into a local services agreement with local municipalities in Sullivan County under which they would provide $15 million per year to mitigate any potentially adverse impacts from the project. Press Release, Executive Chamber Governor David A. Paterson, Governor Paterson Signs Economic Development Compact to Revitalize Catskill Region, Nov. 22, 2010.

In February 2011, the federal government rejected the proposal, which nullified the deal reached late in the previous year between the Paterson Administration and the Tribe. The Interior Department, the agency overseeing matters involving tribes, turned down the proposal for the casino stating that it had concerns whether the gambling compact agreed to and signed by the Tribe and the State, along with the related land settlement, complied with federal law. Charles V. Bagli, Plan for Indian Casino in the Catskills Is Rejected, N.Y. TIMES, Feb. 18, 2011. In the letter to the Tribe, Department of Interior Solicitor Hilary Tompkins said the agreement could not be approved because Indian Trade and Intercourse Act requires congressional consent when a tribe seeks to relinquish ownership of land that has been subject to dispute, and that Department of the Interior approval of the agreement would not have been sufficient to validate the transfer of ownership of Indian-owned land. The letter stated that a specific act of Congress would have to pass for the settlement to be approved. Caitlin Traynor, Stockbridge-Munsee Band of Mohican Indians Hasn't Given Up On Casino Plan; Tribe Still Owns Madison County Land , THE ONEIDA DAILY DISPATCH, Mar. 9, 2011.

After appeals from the Tribe, state, and federal officials, it was reported in April 2012 year that the Stockbridge-Munsee's casino plan is under reconsidation. Interior Department officials reportedly notified local governments that they resumed the environmental review of the proposed casino. Victor Whitman, Feds Again Considering Bridgeville Casino Plan, THE TIMES HERALD RECORD, Apr. 27, 2012. Having twice been written off as dead, first in 2008 when the Bush Administration commutability policy went into effect, and then after the 2011 Interior Department rejection of the plan, the Stockbridge-Munsee casino plan once again had some life injected into it.

Analysis of Casino Impact - Should the Proposal Move Forward?

An analysis of the Stockbridge-Munsee casino proposal should begin by recognizing some of the underlying forces behind the push for approval of the casino plan and the reasons why there is broad support for the project among elected officials. The most obvious catalyst for the project is Sullivan County's economy, which has faced a long period of economic decline in recent times and is in desperate need for economic revitalization.

Sullivan County was for a long time a destination for New Yorkers looking for an escape from city life. During the tail end of the 19th century, the first vacationers began to flock to the county to the enjoy country life and small hotels began to pop up to accommodate them. Soon after, the era of the seasonal influx of New York City-based Jewish immigrant vacationers had begun. Jewish immigrant families began buying up struggling hotels from the prior era, which provided the Jewish vacationers, who were unwelcome in many other resort areas, a place to spend their free time in the company of other Jews. Jewish immigrants began to build larger hotels in the cities of Fallsburg, Liberty, and Livingston Manor ushering in Sullivan County's golden age of the Borsch Belt. By the 1940's over 300 hotels were in operation in the county and by 1953 the New York Times reported there were 538 hotels, including two of the most famous resorts in the world at the time - Grossinger's in Liberty and The Concord in Kiamesha Lake. The "Golden Age" of the Borsch Belt in Sullivan County would last for about 25 years until approximately 1965. John Conway, County History; Timber, Tanning and Tourism , SULLIVAN COUNTY HISTORICAL SOC'Y (2009).

Many factors can be attributed to the decline of the Catskill resorts in Sullivan County. The growth of the suburban lifestyle in the greater New York City area and the invention of air condition diminished the necessity for New Yorkers for find refuge in the Catskills during the summer. In addition, the proliferation of inexpensive air travel also opened up many more options for middle and working class people looking to vacation. Finally, Jewish families became more assimilated over time. By the 1970s, the great Borsch Belt hotels were shuttered and Sullivan County had fallen on hard economic times - and in many ways has never recovered. Id.

The evidence of this economic decline can still be seen today by putting Sullivan County's economic indicators are put side-by-side with both New York State as a whole and the neighboring counties. Sullivan County's per capita income at $23,422, and median household income at $48,103 fall far below the New York State average which stands at $30,948 and $55,603 respectively. The county's median household income disparity is even starker when compared with neighboring Ulster and Orange Counties, which have a median household income of $57,584 and $69,523, respectively.

As discussed earlier, the casino project in Sullivan County was projected to have a major impact on the local economy, with initial projections estimating the project to generate more than $1.3 billion in economic activity during the construction phase, and projections of $900 million in revenue annually for the state economy once operational. That is in addition to an estimated 6,700 direct and indirect jobs to be created for the region. These types of numbers could spark an economic sea change in a county with only approximately 48,000 working age residents and an unemployment rate of 9.3%. Id.

The two biggest political players with regard to the Stockbridge-Munsee casino project are State Senator John Bonacic (R,C - Mount Hope) and United States Senator Charles Schumer (D-NY), both of whom have been active, vocal supporters of the project. Bonacic, a powerful member of the State Senate, has long advocated for casino gaming as a solution to his home county's economic problems. Senator Bonacic, Chair of the Senate Judiciary Committee, was also appointed as Chair of the State Senate's Racing, Gaming, and Wagering Committee in early 2011. Mid-Hudson News Network, Sen. Bonacic to Head Gambling Oversight Panel, THE DAILY FREEMAN, Jan. 13, 2011.

Bonacic's initial efforts had been to focus on moving the Stockbridge-Munsee casino proposal through the current framework of tribal, state, and federal cooperation. He was perceived to be a major player in the 2010 landmark deal brokered between the Paterson Administration and the Stockbridge-Munsee's. However since the 2011 rejection of that deal by the Interior Department, the Senator has shifted to a more parallel focus - continuing to work on the tribal gaming approach while also seeking to amend the State Constitution to allow for casino development by non-tribal parties. James M. Odato, Scoring Casino Game, ALBANY TIMES UNION, Sept. 5, 2011. In March 2012, with the support of Governor Cuomo, Bonacic sponsored an agreement to begin the process of amending the state constitution to allow casino gaming in New York. The original agreement called for no more than seven privately owned commercial casinos in the state. Press Release, Executive Chamber Governor Andrew M. Cuomo, Governor Cuomo, Majority Leader Skelos, and Speaker Silver Announce Landmark Agreement to Begin Process of Amending State Constitution to Allow Casino Gaming in New York , Mar. 14, 2012. The State Assembly and Senate passed the amendment the same month. James M. Odato, Bonacic: It's Possible to Boost Casino Number, ALBANY TIMES UNION CAPITOL CONFIDENTIAL BLOG, Aug. 15, 2012. The constitutionally required second approval by the legislature took place at the end of the 2013 legislative session, thus paving the way for a constitutional referendum to be put to the voters in November. The final agreement asks voters to authorize as many as seven new casinos, although for the next seven years only four will be developed in either the Catskills, the Albany area, or the Southern Tier region. Thomas Kaplan & Jesse McKinley, Casino Referendum Planned by New York Leaders, N.Y. TIMES, June 19, 2013.

A final potential hurdle that stood in the way of the referendum was a lawsuit brought in the fall of 2013, objecting to the positive descriptive language in the measure's ballot abstract, which describes the referendum as "promoting job growth, increasing aid to schools and permitting local governments to lower property taxes." The State Board of Elections approved the language in late July after consultation with the Governor's administration. This suit was dismissed just weeks before Election Day by the State Supreme Court which said the legal challenge over the measure's wording was "untimely and lacking in legal merit." Jesse McKinley, Judge Rejects Suit to Block Vote on Casinos, N.Y. TIMES, Oct. 16, 2013.

Senator Schumer has also been consistently outspoken in his desire to see casino gaming in Sullivan County, stating that the Stockbridge-Munsee project "would be a huge boost for the economy that will include job growth and tourism, in a region that has been struggling for decades to get back on its feet." Danny Hakim, Paterson Is Set to Approve Deal on an Indian-Run Casino in the Catskills, N.Y TIMES, Nov. 16, 2010. Schumer, like Bonacic, was seen as a major player in the 2010 negotiations between Governor Paterson and the Stockbridge Munsee's. More recently, Schumer was a crucial advocate in the reversal of the commutability rule, having urged the Obama Administration to change the Interior Department policy adopted during the Bush years. Scoring Casino Game, supra . Because of his outspoken support for the Stockbridge-Munsee casino project in Sullivan County, the Senator has taken significant heat from the Oneida Indian Nation and other Western New York tribes who see his work as "backroom deal-making" that violates current state and federal law. Mid-Hudson News Network, Oneida Indian Nation Raps Schumer On Casino Deal, THE DAILY FREEMAN, Feb. 7, 2011.

It is beyond debate that Sullivan County has been a shadow of its former self for decades and that any attempts up to this point to inject life into the County economy have fallen woefully short. A cursory glance at the County's economic indicators show that it is underachieving economically both compared to the State as a whole, and its neighboring counties. Those with ears closest to the ground and with the largest stake in the county's success have wholeheartedly bought into the idea that the Stockbridge-Munsee casino is the solution to the county's economic woes. However with the proliferation of casino gambling in the Mid-Atlantic states and New England, it is worth reflecting on whether the construction of a casino in Sullivan County is the panacea that it is widely perceived to be.

Similar to real estate, an important determining factor for the value of a casino is location. Likewise, the most important ingredient in the potential success of the Stockbridge-Munsee casino is its proximity to the New York City. The Town of Thompson, where the proposed casino is to be located, is approximately 90 miles north of the City. In recent history the closest major casinos to New York were Foxwoods and Mohegan Sun Casinos in Connecticut, and of course Atlantic City - all of which are approximately 140 miles away, putting a casino in Thompson in relatively advantageous position. However there has been a recent proliferation of legalized gambling on the East Coast with states such as Delaware, Pennsylvania, and Maryland having opened their borders to casino development in the last five years. See Howard Stutz, Analysts See East Coast Gaming at Tipping Point , CASINO CITY TIMES, Nov. 26, 2012. Today the closest casinos to New York City are in Pennsylvania - the Sands Casino in Bethlehem and the Mount Airy Casino Resort in Mount Pocono, both approximately 80 miles away.

This recent proliferation is in many ways just the tip of the iceberg. Maryland could have six Las Vegas-style casinos in the near future, including a $400 million gambling hall in downtown Baltimore and an $800 million resort south of Capitol Hill on the Potomac River. Pennsylvania gaming regulators are investigating six separate offers to build a $500 million to $700 million hotel-casino in downtown Philadelphia, and Massachusetts authorities are weighing casino proposals for Boston and Springfield. Id. While none of these projects have broken ground yet, gaming experts are already discussing whether the northeast has reached, or will soon reach a casino saturation point. According to Deutsche Bank analyst Andrew Zarnett, revenue and cash flow from older casinos will likely decline as new resorts open, with the number of slot machines having grown rapidly along the Atlantic Coast just in the past five months.

The major problem analysts see with the proliferation of major casinos in the region is that these facilities increase the gaming supply, but do not necessarily add more gamblers - and the numbers have begun to support this proposition. Zarnett has calculated that for the 12 months that ended September 30, 2012, when factoring out revenues from casinos that opened in the past year, the Atlantic Coast casino market revenues declined 3.4 percent for existing operators. Atlantic City has been hardest hit as they try to fend off new competition from neighboring states. Between 2006 and 2011, gaming revenues have fallen 38 percent, from $5.3 billion to $3.3 billion. If all casino projects currently being proposed are ultimately built, Zarnett believes the Northeast and Atlantic Coast market will increase its number of slot machines and gaming tables by almost 18 percent over the next five years. Id.

Over the period of time from when the Stockbridge-Munsee's first began talks with the state and federal governments to acquire land in trust in Sullivan County to where we stand today, seemingly every option has been put on the table - including no casino at all. Although the market for gaming in the northeast corridor has become very competitive in just the last few years, and only stands to become more competitive, the greater New York City market remains relatively untapped. Even when taking into account new plans to build casinos currently in place and moving forward, a Sullivan County casino would stand shoulder-to-shoulder with the Bethlehem and Mount Airy casinos in eastern Pennsylvania as the only casinos within 100 miles of New York City. While the "golden age" of seasonal vacationing in the Catskills is long gone, weekend getaways to the Catskills are very much still in the DNA of New Yorkers and a large-scale casino less than an hour-and-a-half north of Manhattan could prove very successful.

The major decision that Governor Cuomo and the New York State government has in front of them is how they will move forward if the gates to non-tribal gaming are opened in the state. This discussion becomes moot of course if the general public rejects the gaming referendum when it comes up for a vote this November. If the constitutional amendment is ultimately approved it will have major implications on the Stockbridge-Munsee casino proposal.

The approval of non-tribal gaming in the context of the current framework negotiated by the Governor, Legislature, and the various third parties, will almost certainly mean the development a major casino in either Ulster Country, Sullivan County, or both. If this were to happen it would essentially beat the Stockbridge-Munsee Tribe to the punch, and would ostensibly kill the Tribe's interest in the development of a casino on their land in Sullivan County. All stakeholders will have to take a wait-and-see approach for now, with the Stockbridge-Munsee tribe standing to reap the greatest benefit from a situation where the constitutional referendum fails and the casino project is approved by the Interior - and non-tribal casino companies and the New York State tax roll standing to reap the greatest benefit from passage of the referendum, and a second rejection of the Stockbridge-Munsee project by the Interior Department.

Benjamin Kern is a graduate of Albany Law School currently living in Albany, N.Y. Benjamin grew up in Ulster County and lived in Germany before attending American University, where he majored in U.S. Foreign Policy. Benjamin's experiences in both Washington and Albany include work at the House of Representatives, the Department of Justice, the law firm Jones Day, the Cuomo Administration, and most recently the New York Democratic Senate Campaign Committee.

"Big Data And Criminal Law" by Samuel Yellen

Big Data And Criminal Law

by Samuel Yellen

Introduction: Big Data as a Three Step Process

Law enforcement agencies today can collect, store, and quickly analyze more data than ever before. This trend of analyzing large amounts of data quickly in business and government is known as Big Data. It is the direct result of the convergence of two trends in computing, the ability to collect and store large amounts of information and the widespread availability of inexpensive computing resources which permit calculations and predictions to be made on a large scale. Big Data is an important and significant trend in government. Over the past decade, there has been a series of revelations relating to the government's increasing appetite for information. Furthermore, constituents are demanding more efficient work from their law enforcement agencies. See, e.g., Kenneth Cukier, Data, Data Everywhere , ECONOMIST, Feb. 27, 2010, at 3-5.

In order to illustrate the problems that Big Data poses for criminal law, I look at Big Data as a process. Big Data involves first, the collection of information; second, the storage of that information; and third, the use of that information. Accordingly, I have written this article in three parts, each of which corresponds to a certain step along the way in the Big Data process.

I. Collection and surveillance

The first step in the Big Data process is collection and surveillance. Thus, one of the challenges facing courts and lawmakers is where to draw the line between the individual's Fourth Amendment right to be free from unreasonable search and the government's interest in collecting information and using it. The government has been historically restricted from collecting information both by the Constitution and statutes such as the Wiretap Act, the Electronic Communications and Privacy Act (ECPA), and the Stored Communications Act the courts have struggled with how to adapt the Fourth Amendment's concept of reasonableness in the context of new technologies such as GPS trackers, smartphones, and the Internet. The flexibility inherent in the idea of reasonableness has permitted the Fourth Amendment to stay relevant as technology has changed.

Unfortunately, there is not yet a generally accepted doctrine that meets the particular challenges presented by such new technologies, namely the extent to which users willingly and unwillingly disclose personal information to third parties and the high level of detail that they provide about an individual's private life. Under the third-party doctrine of United States v. Miller, an individual has no expectation of privacy when private information is shared with a third party. For example, emails, and web searches are may reside with a third-party such as Google or Microsoft. Under Miller, the government may lawfully obtain them without a warrant. The second issue is whether highly particularized information collected by the government may constitute an unreasonable search was taken up in United States v. Jones.

In United States v. Jones, the United States Supreme Court declined to change the reasonable expectation of privacy for the Internet age. However, several members of the court appeared ready to do so. In Jones, the police placed a GPS tracking device on the defendant's car without a warrant. The defendant appealed on the grounds that this violated his Fourth Amendment right against unreasonable search and seizure. The government argued that the surveillance was reasonable because the public-view doctrine applied, the GPS only tracked his movements on public roads. Agents could have lawfully observed him as he drove. The GPS device just made their job easier, but also far more effective than a team of agents could have been. The D.C. Circuit Court of Appeals relied on a mosaic theory of privacy whereby if a technology gave officers too high a level of particularity over a defendant's movements then it was violating a defendant's Fourth Amendment rights:

"Prolonged surveillance reveals types of information not revealed by short-term surveillance, such as what a person does repeatedly, what he does not do, and what he does ensemble. These types of information can each reveal more about a person than does any individual trip viewed in isolation." United States v. Maynard, 615 F.3d 544, 562 (D.C. Cir. 2010), aff'd in part sub nom. , United States v. Jones, 132 S. Ct. 945 (2012).

The Supreme Court was not entirely hostile to the mosaic theory, but the majority opinion written by Justice Scalia went with a trespass theory of privacy. It ruled that in attaching the GPS device to the defendant's car, the police were violating his right to privacy. Jones , 132 S. Ct. at 949(2012). See, e.g., David Gray et al., Fighting Cybercrime After United States v. Jones, 103 J. CRIM. L. & CRIMINOLOGY 745 (2013).

Notions of reasonable privacy have changed before when presented with technology. In the well-known case of Katz v. United States, the Supreme Court ruled that a man using a pay phone had a reasonable expectation of privacy while on the phone and therefore surveillance of his phone conversation was unconstitutional. 389 U.S. 347(1967). The Katz decision overturned what had been the prevailing notion of privacy since Olmstead v. United States. See 277 U.S. 438, 457, 464, 466 (1928). In Olmstead, the Court applied a trespass standard and held that wiretapping was constitutional because the phone tap was installed down the road from the defendant's house. Id.

While the Katz decision created a privacy formulation that met the needs of a new technology, telephone communications, it is much harder to find such an appropriate model of privacy to fit today's environment and constant sharing. There is no one right answer to the problem of privacy in today's environment. Big Data enthusiasts and optimists argue for rewriting privacy laws to allow society to gain the full benefits of computerized analysis while other commentators disagree. Omer Tene & Jules Polonetsky, Big Data for All: Privacy and User Control in the Age of Analytics, 11 NW. J. TECH. & INTELL. PROP. 239 (2013)(cf. Paul Ohm, The Underwhelming Benefits of Big Data, 161 U. PA. L. REV. ONLINE 339, 346 (2013)).

In Jones, Justice Alito notes that traditional notions of privacy do not exactly apply in todays interconnected world because persons receive benefits for their sharing of information with third parties:

"The Katz test rests on the assumption that this hypothetical reasonable person has a well-developed and stable set of privacy expectations. But technology can change those expectations. Dramatic technological change may lead to periods in which popular expectations are in flux and may ultimately produce significant changes in popular attitudes. New technology may provide increased convenience or security at the expense of privacy, and many people may find the tradeoff worthwhile."

Jones, 132 S. Ct. at 962.

Ultimately, Justice Alito suggests that the definition of privacy expectations is a task best left to the legislature. Id. at 964, 911 (2012)(citing Orin S. Kerr, The Fourth Amendment and New Technologies: Constitutional Myths and the Case for Caution, 102 MICH. L. REV. 801, 804-05 (2004)).

The challenge of balancing the Fourth Amendment right to privacy with the government's interest in policing effectively has some commentators to propose that we view privacy not as an absolute right, but instead in instrumentalist terms. They argue that there are costs and benefits associated with infringements on privacy and we should simply perform a cost-benefit analysis when it comes to determining whether a given act of surveillance should be allowed or not. Steven Penney, Reasonable Expectations of Privacy and Novel Search Technologies: An Economic Approach, 97 J. CRIM. L. & CRIMINOLOGY 477, 480 (2007). Whether based on a weighing of rights and interests or an instrumentalist approach, courts and the legislature have yet to specifically delineate the bounds of privacy in the present age of Big Data.

II. Storing Information: Using Databases

After the government collects information, the next logical step is for it to store the information in a database. Once it is stored in a database the law enforcement officers may query it, or certain services may be refused based on a match, such as the "No Fly List." A number of commentators have written about how a coherent legal framework for government databases does not yet exist, which would deal with such issues as when they should be used and how they should be maintained.

Frederic Cate proposes a legal framework. In it he suggests that there is already substantial agreement about what key features a legal framework regarding data mining should have. It should require agencies to verify the effectiveness, keep the records updated, and include some measure of judicial oversight. Fred H. Cate, Government Data Mining: The Need for A Legal Framework, 43 HARV. C.R.-C.L. L. REV. 435, 487-88 (2008). The closest we have come today legislatively is the Privacy Act, passed in 1974. Cate explains that the privacy act requires agencies to "1) store only relevant and necessary personal information and only for purposes required to be accomplished by statute or executive order; (2) collect information to the extent possible from the data subject; (3) maintain records that are accurate, complete, timely, and relevant; and (4) establish administrative, physical, and technical safeguards to protect the security of records." Id. at 464-65. Unfortunately, many of the most critical databases, such as the FBI's NCIC database have been exempted from the requirements of the privacy act. 5 U.S.C.A. § 552a(j-k)(2013).

In addition to lacking a legal framework, it is very difficult for someone incorrectly included on a database to challenge that determination. A person may be added to the database without a hearing. In some cases a person's only remedy may be to sue for expungement rather than addressing a specific mistake in the database, and even then it can be challenging for a plaintiff to achieve standing. See Bernstein at 511. One of the most obvious examples of a database affecting people's rights is the government's No Fly List. Anya Bernstein has commented on No Fly Lists and the way that they negatively affect those listed. She argues often that agencies view that false positives results in no cost, that is that there is not a cost associated with identifying someone as a terrorist when they are not is of no consequence to the agency. Bernstein at 463. A good legal framework for government databases would incentivize agencies to maintain accurate databases and minimize both false positives and false negatives.

III. Using the data: Predicting Crime

The promise of Big Data is that it may allow police departments to identify patterns utilize them to more effectively prevent crime and intercept inchoate crimes. But making arrests based on patterns may offend the constitution, especially when a computer generated prediction treats a certain class of individuals differently. Andrew Guthrie Ferguson has examined many of these different types of prediction analyses. He explains that local law enforcement agencies have had some success working on property crimes because once one crime occurs it is likely that a similar one will occur. See Andrew Guthrie Ferguson, Predictive Policing and Reasonable Suspicion, 62 EMORY L.J. 259, 281 (2012). Id. Already, several communities are using predictive policing methods to determine areas where crime is likely to occur and policing them more closely. See, e.g., Predictive Policing: Don't Even Think About It, ECONOMIST, July 20, 2013.

While property crimes are perhaps a more straightforward use of predictive crime fighting technology, communities are working to put more technology in the hands of the officer on the beat. In order to illustrate some of the potential constitutional pitfalls of predictive policing, it is helpful to imagine a hypothetical traffic stop. Imagine after a traffic stop a police officer queries an electronic program which takes into account, the time, the location of the stop, the make and model of the car and the age of driver. Based upon an unknown algorithm, the program recommends that the officer search the car. If the search of the car yields drugs, was the search constitutional under the Fourth Amendment? If it later becomes known that the algorithm disproportionately affects a certain race, does it violate the Equal Protection Clause? What if the machine prints out a receipt, stating that the probable cause for the search was 25% based on the model of the car, 25% on the time of the stop, and 50% based on the location?

The Supreme Court has not yet ruled whether a statistical profile may be sufficient grounds for probable cause under the Fourth Amendment. Although it has heard at least six cases in which the Drug Enforcement Agency (DEA) Drug Courier Profile has been a basis for probable cause, in each case it only looked at the factors underlying the profile. See Daniel J. Steinbock, Data Matching, Data Mining, and Due Process, 40 GA. L. REV. 1, 29-30 (2005) (internl citations omitted). The Drug Courier Profile is not perfectly analogous to a computerized profile, because the Drug Courier Profile is much simpler¬-- the agent is given a list of criteria to look for and then makes his own determination. A computerized model has the potential to be much more accurate than human experts. See Grove et al., Clinical Versus Mechanical Prediction: A Meta-Snalysis, PSYCHOLOGICAL ASSESSMENT, Vol 12(1) (March 2000), at 19-30, http://www.ncbi.nlm.nih.gov/pubmed/10752360 (mechanical prediction typically as good or better than human judgment across 146 types of assessments).

One of the difficult questions in predictions and other statistical approaches is determining when a prediction unfairly affects a class of the population. Under the Supreme Court's analysis in Whren v. U.S., if a traffic stop is being challenged on the basis that race inappropriately caused the arrest where probable cause did not exist, then a suit may only be brought as a violation of the Equal Protection Clause and not under the Fourth Amendment. Significant research has been done as to whether police disproportionately stop minority motorists and whether such disproportionality evinces racism. Some economic models have been proposed that look at connection between stops and arrests made to determine whether the disproportionality is justified. Bernard E. Harcourt, Rethinking Racial Profiling: A Critique of the Economics, Civil Liberties, and Constitutional Literature, and of Criminal Profiling More Generally, 71 U. CHI. L. REV. 1275, 1306-07 (2004).

One problem is may occur is that a law enforcement agency may base their actions on a criterion that is highly correlated with race. For example, in New York City's controversial Stop and Frisk Program, targeting certain neighborhoods with higher crime also led to a disproportionate number of stops on minorities. New York commissioned two different reports on its policing and reached two different conclusions, which shows the difficulty of determining racial bias through statistics. See, e.g., Dasha Kabakova, The Lack of Accountability for the New York Police Department's Investigative Stops, 10 CARDOZO PUB. L. POL'Y & ETHICS J. 539, 560 (2012).

In the hypothetical above, transparency can go a long way towards addressing the constitutional issues raised by predictive policing. If the DEA Drug Courier Profile cases are any indication, then a prediction may survive a Fourth Amendment challenge by explaining the factors underlying the decision. In order to survive a claim under the Equal Protection Clause, a police department could offer expert testimony as to whether it unfairly applies the law. Finally, a receipt would helpful because it serves to memorialize the decision making of the prediction system at the time the arrest or search was made.

First Amendment Challenges

In addition to the Fourth and Fourteenth Amendment challenges, Big Data techniques may also offend against the First Amendment rights of assembly and expression. For example, in May 2013, it came to light that the IRS was scrutinizing the tax returns of certain political groups likely to be part of the Tea Party. The problem arose from the fact that the IRS created an algorithm to select which applications to scrutinize. Unfortunately that algorithm singled out certain types of political groups, thus potentially offending their First Amendment right to freedom of expression. See Hans A. von Spakovsky, Protecting the First Amendment From the IRS , HERITAGE FOUNDATION, Oct. 2, 2013.

Even if the IRS employees conducting the reviews were not acting maliciously, it is clear that the public was uncomfortable with the notion of treating groups differently based on their political orientation. If we were to apply some of the criteria used for race based encounters (i.e., are the offending rates different, do the enforcement actions lead to similar amounts of arrests), then the IRS might be able to legitimately claim to increase scrutiny on a certain political group. For example, hypothetically speaking, were there to be a political party that actively encouraged tax fraud, the IRS might legitimately be able to scrutinize that groups members for tax fraud, but the IRS might have to prove that its system for selecting applications for scrutiny was empirically supported.

Commentators have also pointed to freedom of association as being vulnerable to government infringement through Big Data. See Katherine J. Strandburg, Freedom of Association in A Networked World: First Amendment Regulation of Relational Surveillance, 49 B.C. L. REV. 741 (2008). Software companies regularly sell the government products promising social network analysis. These types of programs are able to examine many interactions between individuals and entities, whether through call logs, websites, emails, or financial transactions in order to quickly find the salient connections for government agencies. See, e.g., Andy Greenberg, How a 'Deviant' Philosopher Built Palantir, A CIA-Funded Data-Mining Juggernaut, FORBES, Sept. 2, 2013. The examination of networks of friends and associates may be a very powerful tool to law enforcement agencies seeking to disrupt terrorists or organized crime. At the same time, courts and the legislature must protect the individual rights of law-abiding citizens. If the law enforcement agencies are transparent about their programs and their intentions, then the boundaries of such programs can be informed by a healthy public debate.


In order for Big Data to fulfill its promise of more efficient policing and reduced crime, it is important that courts and the legislature demand transparency from law enforcement agencies. Transparency would help defendants challenge searches and seizures when their constitutional rights are violated. But the benefits of transparency are not limited to defendants. Law enforcement agencies and the public would benefit from transparency too because it would help earn the public's trust in new methods of policing. Only when these new and powerful methods are able to be properly scrutinized and understood will most effectively achieve the desired goal of more efficient policing and reduced crime.

Samuel Yellen is a first-year J.D. candidate at SUNY at Buffalo Law School.

November 14, 2013

"Rape By Fraud, Deception, Or Impersonation - An Addition To New York's Penal Law: Rape In The First Degree Statute" by Daniel J. Slomnicki

Rape By Fraud, Deception, Or Impersonation - An Addition To New York's Penal Law: Rape In The First Degree Statute

by Daniel J. Slomnicki


The crime of rape by fraud, deception, or impersonation occurs in the following way: the perpetrator tricks a victim into having sexual intercourse. The classic case is where a perpetrator impersonates a victim's spouse and convinces the victim to have sexual intercourse. The catch is that the victim believes this perpetrator is his or her spouse, and further believes that the sexual intercourse is with his or her spouse, not this perpetrator. There has been an ongoing struggle and debate for more than a century on whether accomplishing sexual intercourse by means of fraud is a crime.

New York does not have a crime of rape by fraud, deception, or impersonation. In fact, 27 states do not criminalize sexual intercourse obtained by fraudulent means. Furthermore, such a case has not been decided in a New York courtroom since 1994. Nevertheless, this paper argues that it is time for the New York legislature to act. It is time for the New York legislature to finally adopt an amendment that makes it a crime in the state of New York for a perpetrator who obtains sexual intercourse by fraudulent means. The New York legislature should act now and follow the leads of the many jurisdictions that already criminalize rape by fraud, deception or impersonation.


A. Sex Offenses in New York

In the State of New York, sex offenses are criminalized under Article 130 of the Penal Law. An element in every sex offense is that a "sexual act was committed without consent of the victim." See N.Y. PENAL LAW § 130.05(1) (2013). New York Penal Law §130.05(2) states that a "lack of consent" can result from: (a) "forcible compulsion"; (b) "incapacity" of the victim to consent; or (c) for "sexual abuse or 'forcible touching,' in addition to forcible compulsion or incapacity to consent," when "the victim does not expressly or impliedly acquiesce in the actor's conduct"; or (d) for third-degree rape and third-degree criminal sexual act, "in addition to forcible compulsion" when "the victim clearly expressed that he or she did not consent to engage in such act, and a reasonable person in the actor's situation would have understood such person's words and acts as an expression of lack of consent to such act under all the circumstances."

Within Article 130 of the Penal Law are many kinds of prohibited sexual activity. These activities include: sexual intercourse, oral and anal sexual conduct, and sexual abuse by sexual contact (the touching of a person's sexual or intimate parts for the purpose of sexual enjoyment), or by the insertion of a "foreign object" in another's vagina, urethra, penis, or rectum. A person who engages in this conduct, without the other person's consent, commits a crime.

New York criminalizes rape under three different statutes: rape in the first degree, rape in the second degree, and rape in the third degree. Rape in the first degree adopts the traditional definition of rape. The statute prohibits "sexual intercourse with another person: (1) by forcible compulsion . . ." See N.Y. PENAL LAW § 130.35 (2013). The element that the sexual act was committed without the consent of the victim is also included. See N.Y. PENAL LAW § 130.05(1) (2013).
In addition to the traditional definition of rape in the first degree, the New York legislature has also enacted various statutory rape laws.

Traditionally, the act of rape was viewed as a crime of violence and "female defilement." See Jeb Rubenfeld, The Riddle of Rape-by-Deception and the Myth of Sexual Autonomy, 122 YALE L.J. 1372, 1388 (2013). However, rape can also be viewed as a sex offense, because the victim's rights to sexual integrity and autonomy have been violated. See Patricia J. Falk, Rape by Fraud and Rape by Coercion, 64 BROOK. L. REV. 39, 141 (1998). This right is given so that people can decide for themselves who and how to have sexual intercourse. In this respect, rape law can be viewed as a protection of both the sexual and physical autonomy of victims, since rape violates a victim's interests and rights in two ways. See Susan Estrich, Rape, 95 YALE L.J. 1087, 1105 (1986). The first violation occurs by the use of force, where the victim's "interest in freedom from injury and the right against intentional injury protected in nonsexual contexts" is violated. The second violation occurs because the victim's body is used "for sexual gratification violat[ing] the interest in exclusive control of one's body for sexual purposes." See Donald A. Dripps, Beyond Rape: An Essay on the Difference Between the Presence of Force and the Absence of Consent, 92 COLUM. L. REV. 1780, 1797 (1992).

During the past several decades, rape law has been reformed in radical ways. And as the world began to change, the laws did too. This wave of reform incorporated the right of sexual autonomy into rape law. In 1977, in the United States Supreme Court's decision of Coker v. Georgia, the Court noted that rape violates a woman's sexual autonomy. 433 U.S. 584 (1977). This explanation by the Supreme Court has helped establish a new way of viewing rape as a crime that violates a victim's sexual autonomy. See Rubenfeld, supra, at 1383. There is also a considerable amount of literature by rape scholars discussing the sexual autonomy. See, e.g., SUSAN ESTRICH, REAL RAPE 102 (1987); see also STEPHEN J. SCHULHOFER, UNWANTED SEX: THE CULTURE OF INTIMIDATION AND THE FAILURE OF LAW 16-17 (1998). This change in society and view of rape as a violation of one's sexual autonomy has effectively shifted the analysis to where the consent element has become the focus of rape law. See Russell L. Christopher & Kathryn H. Christopher, Adult Impersonation: Rape by Fraud as a Defense to Statutory Rape, 101 NW. U. L. REV. 75, 88 (2007).

The New York legislature made changes to Article 130 when it enacted the Sexual Assault Reform Act of 2000. See Law of New York 2000, Chapter 1, available at http://www.criminaljustice.ny.gov/legal services/ ch1_sex_assault_reform_2000.htm. This act was designed to reflect the modern views and theories about the nature of the crimes of rape and criminal sexual acts as violations of the victim's personal autonomy, and not as a violent act. See Eve Cary & Lynn W. L. Fahey, Introduction, 6 N.Y. Prac., Criminal Law §7:1 (April 2012).

Most significantly, the Act created new crimes of rape in the third degree and criminal sexual act in the third degree. These statutes were created for the purpose of punishing "date rapes" where there was no force beyond that required to commit the sexual act. The statutes focused on the victim making it clear in a manner that a reasonable person would understand that he or she does not consent to the sexual act. This law reflected the societal view that "no means no," and that a person who commits sexual acts when he or she knows that those acts are unwanted should not go unpunished because he or she did not use any physical force. These new statutes were examples of the New York legislature reforming their rape laws to be violations of a victim's personal autonomy, and not as violent acts.

When constructing a statute, "words are not to be rejected as superfluous when it is practicable to give to each a distinct and separate meaning." See N.Y. STATUTES LAW § 231 (2013). Therefore, the § 130.35, in conjunction with § 130.05 requirements of "by forcible compulsion" and "without consent of the victim," are to be understood as two distinct and separate elements. In order to satisfy these requirements for a conviction of rape, the People must show beyond a reasonable doubt that the defendant committed sexual intercourse, (1) by a "use of physical force, or a threat, express or implied, which places a person in fear of immediate death or physical injury to himself, herself or another person, or in fear that he, she or another person will immediately be kidnapped," and (2) "without consent of the victim." This interpretation of § 130.35 has significant implications for cases where the victim's consent to have sexual intercourse is obtained through fraudulent means. These cases, known as rape by fraud, deception, or impersonation, are crimes that presently do not exist in New York.

B. Law of Rape by Fraud, Deception or Impersonation

Fraud, like force and coercion is rape because it vitiates the consent of the victim. However, the means differ with regards to consent. A denial of consent in rape by physical force needs to be a "legally effective non-consent." See ESTRICH, supra, at 102-03. However, in rape by fraud cases, the issue concerns whether or not a victim's consent to sexual intercourse obtained by fraudulent means is a "legally effective consent." See Christopher & Christopher, supra, at 78.

The two most common forms of rape by fraud occur in the context of medical treatment and marital relations. See Anne M. Coughlin, Sex and Guilt, 84 VA. L. REV. 1, 19 (1998). A typical medical treatment case can occur in two ways, only one of which can lead to a rape conviction under the traditional view. One such case is where a doctor has sexual intercourse with the patient, but conceals it from the patient who believes this to be nothing more than a pelvic examination or penetration by a medical instrument. The other case is where the doctor has sexual intercourse with his patient by telling the patient that the intercourse was a necessary medical treatment. See Wayne R. LaFave, 2 SUBST. CRIM. L. § 17.3(c) (2d ed. Oct. 2012). A typical marital relations case occurs when a spouse consents to sexual intercourse believing the other person to be his or her spouse. The fact of the matter is that in these examples of rape by fraud the victim consents to an act, but receives something very different. See Christopher & Christopher, supra, at 122.

The "traditional formula" for distinguishing between fraud that vitiates consent and fraud that does not vitiate consent is whether the fraud is fraud in the factum or fraud in the inducement. See Falk, supra, at 157. Rollin M. Perkins and Ronald N. Boyce describe such concepts as follows:

The general rule is that if deception causes a misunderstanding as to the fact itself (fraud in the factum) there is no legally-recognized consent because what happened is not that for which consent was given; whereas consent induced by fraud is as effective as any other consent, so far as direct and immediate legal consequences are concerned, if the deception relates not to the thing done but merely to some collateral matter (fraud in the inducement).
Id. at 158; see also Martha Chamallas, Consent, Equality, and the Legal Control of Sexual Conduct, 61 S. CA. L. REV. 777, 831 n.224 (1998).

However, this distinction has been criticized by many, and its influence is weakening.

As the analysis of rape shifted from a crime of violence to more of a violation of one's sexual autonomy, some jurisdictions went as far as enacting sex offenses that criminalized fraudulently obtained consent to sexual intercourse. See Lucy Reed Harris, Comment, Towards a Consent Standard in the Law of Rape, 42 U. CHI. L. REV. 613, 644 (1976); see Falk, supra, at 161. Many jurisdictions also have prohibited specific types of fraud. New York, however, does not criminalize rape by fraud in any way, shape, or form.

C. New York Case Law

The first known case in the state of New York to address rape by fraud was People v. Bartow, 1 Wheeler CC 378 (N.Y. Recorder's Ct. 1823), cited in the reports of criminal law cases decided at city hall in New York City. In 1823, the court decided whether force was necessary to constitute rape. Ann Way, the complainant, was a married woman and lived with her husband. On April 15, 1822, after returning home from a day of work, she went to sleep and was awakened by the defendant, whom she thought was her husband, having sexual intercourse with her. About a half an hour later, Ann Way's daughter came into the room and noticed that her mother was in bed with another man, and shouted "get up, mother, get up man." The defendant was eventually apprehended and arrested and was charged with assault and battery.

After the prosecutor rested his case, defense counsel, arguing for dismissal, challenged the charge of assault and battery, and demanded that there could be no conviction. He argued that assault and battery, a misdemeanor, should be merged with the crime of rape, a felony. And based on the account of the complainant, defense counsel claimed that the merger can be established since the defendant might have raped her by fraud, thereby merging assault and battery with rape. The argument was that in a rape case, fraud must be construed to mean force, citing to New York City Mayor Cadwallader Colden's statement made in that very court regarding an attempt to commit a rape that "if the defendant has succeeded in deceiving the woman and accomplishing his purpose, he would have been guilty of rape." Id. at 380.

The court decided "that force was an essential ingredient in this kind
of felony," and fraud would not be construed as such, thereby not dismissing the prosecution. Id. The jury ultimately rendered a verdict of not guilty. At the conclusion of the reported case, there is a note to the effect that former Chief Justice Smith Thompson of the Supreme Court of New York, at a court of Oyer and Terminer in Albany, ruled "that force was not necessary to the commission of a rape, but that stratagem might be tried to supply its place," and so he charged a jury in a case similar in character to Bartlow.

In 1867, in Walter v. People, the Supreme Court, New York County, held that a jury charge relating to a doctor who told his patient that he needed to perform sexual intercourse with her because it was necessary for the recovery from a disease in her womb was erroneous. 50 Barb. 144 (1867). The proposed jury instruction stated: "[a]s to the degree of force used in a case like this, where resistance is not made by reason of a representation leading the female to believe that sexual penetration of her body is necessary for the recovery from disease, the force used in ordinary sexual intercourse is sufficient to constitute a rape." Id. at 146-47. The court noted that there is no authority for such a proposition. The suggestion rests upon a treatise that the court does not regard as authoritive, and the note that was found at the end of the report of People v. Bartow. The court held that these "loose statements" are not entitled to any consideration. Essentially, the courts in New York would not interpret the Penal Law as having established rape achieved by fraud.

i. People v. Evans

In 1975, in People v. Evans, the defendant tricked a woman by admittedly using false premises and "a psychological game" to induce her into his apartment by claiming to be a psychologist, whereupon he seduced her by means that were very intimidating and threatening. See 85 Misc.2d 1088 (1975). The Supreme Court, New York County, made it clear that the essential element of rape in the first degree is forcible compulsion. The court decided that if there is actual consent to the sexual intercourse then no matter how wrong the fraud, it is not rape. Fraud cannot be substituted for the force requirement of rape. The court in its analysis noted that seduction is not like rape, since "the consent of the woman, implied or explicit, has been procured, by artifice, deception, flattery, fraud or promise." Id. at 1095.

However, the court reasoned that since the common law, the courts have recognized larceny by trick, as long as there was a taking of property value. Therefore despite the fact that the law recognizes crimes where trickery and deceit compose the basis for a criminal charge it would not apply to a woman's right to her body since as defined by law, her body is not property. The court did voice its disapproval of the defendant's conducts by calling him "The Abominable Snowman." Id. at 1099.

ii. People v. Hough

When People v. Hough came before the District Court, Nassau County, in 1994, the court explored the issue of whether a female actually consents to sexual intercourse with a male who obtains the consent of the female by impersonating the female's boyfriend. 159 Misc.2d 997 (1994). While sleeping in her apartment which she left unlocked because she was expecting her boyfriend Lenny Hough to come over, the complainant was awakened by a knock that she believed was her boyfriend at the door. The woman instructed the defendant to come in believing it was her boyfriend. Turning the lights on and realizing that the male was not Lenny but his twin brother Lamont, she and the defendant talked shortly and after the defendant left the apartment, the woman went back to sleep.

A short while after, the woman heard another knock on the door and heard a male, who sounded like her boyfriend, say "open the door." The woman got out of her bed turned off the light near the door and Lamont, whom the complainant thought was Lenny, entered into the apartment. After speaking to each other momentarily in the dark the two made their way into the bedroom, where Lamont began to sexually touch the complainant and eventually engage in sexual intercourse with the woman. Throughout the sexual engagement the complainant was calling the defendant Lenny.

When the two had finished the act, Lamont said "was that the best sex you ever had?" and "what are you going to tell Lenny?" The complainant got out of her bed, turned on the lights and saw that the male was Lamont, not Lenny. She threw the defendant's clothes out the door and the defendant left. She then contacted the police and reported the incident. After his arrest, the defendant was charged with sexual misconduct. See id. at 999.

In its decision, the court began by stressing that under the Penal Law, § 130.20 must be read in conjunction with § 130.05, which provides the definition for lack of consent. However, the court noted that the lack of consent for which the People base their charge against the defendant is not claimed under § 130.05. Rather, the lack of consent is from the victim's "mistaken belief resulting from defendant's alleged fraud that the body she made love with was that of her boyfriend." Id.

The court noted that the crime of sexual misconduct does overlap with the crime of rape. And,according to the court, fraud cannot vitiate the consent element in both crimes. "In general, in the absence of a statute, where a woman is capable of consenting and does consent to sexual intercourse, a man is not guilty of rape even though he obtained the consent through fraud or surprise. The reason is that in the traditional definition of the crime of rape, the sexual intercourse must have been achieved 'by force', or 'forcibly.'" Id. at 1000. Courts have indicated that when a defendant impersonates a woman's husband, as the defendant did in Bartow, 1 Wheeler CC 378 (1823), that the consent by the woman for sexual intercourse may be vitiated. But as the court in Walter pointed out, no consideration is given to fraud vitiating consent. See50 Barb. 144 (1867).

However, the court also discussed a number of states that have enacted statutes that extended the traditional definition of rape to include fraud or impersonation. In Arizona, a former statute defined rape to include: "where the female submits under a belief that the person committing the act is her husband, and this belief is induced by any artifice, pretense of concealment practiced by the accused with intent to induce such belief." See Hough, 159 Misc.3d at 1000-01. In North Carolina, a former statute criminalized "any person who shall have had carnal knowledge of any married woman by fraud in personating her husband." Id. at 1001. The court also mentioned that the Model Penal Code makes it a crime for a male to have sexual intercourse with a female when he knows that she consents because she thinks he is her husband.

The court noted that since the legislature did not include cases of fraud or impersonation as a definition to a lack of consent under Penal Law § 130.05, it was intended. So the court would not legislate and construe a statute that the legislature did not intend on creating. Because of the court's inability to judicially legislate, and its realization that if the legislature had wanted fraud and impersonation to be defined as a lack of consent the legislature would have stated it, the court dismissed the charge of sexual misconduct against the defendant. Therefore, it ruled that if the defendant did deceive the complainant into have sexual intercourse with him, he is not guilty of sexual misconduct.

Interestingly, the court concluded that its decision is not saying that the defendant did nothing wrong if he did deceive the complainant. Rather, the court is saying that the prosecution charged the defendant with the wrong crime. And if the People wanted to file another accusatory instrument charging the defendant with another crime they could. The People never did, and the defendant was free from criminal liability.

D. Jurisdictions That Do Not Criminalize Rape by Fraud, Deception or Impersonation

New York is among the jurisdictions that do not criminalize defendants who obtain consent for sexual intercourse obtained by fraudulent means. These states have held that such an act is not sufficient to be deemed rape under the law. As the court in Evans noted, their decision was consistent with the "prevailing view in this country." Evans, 85 Misc.2d at 918-19.

The court relied on a Supreme Court of Michigan case from 1872, Don Moran v. People. 25 Mich. 356 (1872). In Don Moran, the defendant, a doctor, induced a 15-year-old girl to have sexual intercourse with him. After the defendant examined the girl, he diagnosed her with an inverted uterus and said that she was ulcerated. He told her that in order "to save her life it would be necessary to enlarge her 'parts.'" Id. at 357. The defendant explained to her that he can do this with instruments, but that she would probably die. He then told her that the only way to live would be to have sexual intercourse with him. At first she objected, but then the doctor, using deceptive statements, told her that he has done this to all women who have been treated by him, and that her father authorized the sexual intercourse. The girl relied on these statements and consented to sexual intercourse with the doctor.

The court overturned the conviction because the trial court had in error instructed the jury by ignoring the requirement of force for the crime of rape. The court held that fraud cannot substitute force in rape. But the court also noted that obtaining sexual intercourse by fraud may be as criminal as forcible rape if the legislature were to outlaw it.

Another case, Commonwealth v. Goldenberg, decided in 1959, was also relied on by the Evans courts. See338 Mass. 377 (1959). The Supreme Judicial Court of Massachusetts decided whether rape is committed when consent is obtained by fraud. Goldenberg, a physiotherapist was referred to by someone to help a patient obtain an abortion. He told his patient that on the second of three procedural visits, he would have to have sexual intercourse with her and that it would help somehow. The patient did not object, and the defendant eventually had sexual intercourse with her.

After a few days, the woman told a friend what happened and she later told her mother as well. The Massachusetts State Police was eventually notified as to what happened, and the defendant was eventually charged with rape. The defendant was eventually found guilty of rape, and he appealed with exceptions to the jury's verdict.

The Supreme Judicial Court sustained the exceptions, set aside the jury's verdict, and ordered a judgment for the defendant. The court's ruling was based on the grounds that the evidence was not sufficient to prove that rape was committed. The court could not come to the conclusion that the woman did not consent to sexual intercourse, nor hold that the force requirement had been met. Therefore, the court held that obtaining consent to sexual intercourse by fraudulent means is not rape in Massachusetts. The court stated that "[f]raud cannot be allowed to supply the place of the force which the statute makes mandatory." Id. at 384.

In Suliveres v. Commonwealth, the Supreme Judicial Court of Massachusetts once again decided whether a defendant who fraudulently obtains consent to have sexual intercourse is considered rape. 449 Mass. 112 (2007). In Suliveres, the defendant entered into his brother's girlfriend's dark bedroom, impersonating his brother, strikingly similar to the facts in Hough, and had sexual intercourse with her. She believed the defendant was her boyfriend at the time of the intercourse. The Commonwealth asked the court to overrule the Goldenberg decision, which was decided in 1959.

The court reaffirmed the decision made in Goldenberg and ruled that "[f]raudulently obtaining consent to sexual intercourse does not constitute rape as defined in our statute." Id. at 118. The court would not read "force" out of the rape statute. Since the legislature never amended the statute, the court was not going to rewrite the intentions of the statute. Therefore, the court ruled that if the force and lack of consent elements of rape were both not satisfied, then sexual intercourse obtained by fraud would not constitute rape in Massachusetts. Besides for these cases, courts in other jurisdictions have also held that sexual intercourse obtained by fraudulent means does not satisfy the force element and is not rape. See, e.g., Lewis v. State, 30 Ala. 54, 56 (1857); State v. Brooks, 76 N.C. 1, 4 (1877); Commonwealth v. Culbreath, 36 Va. Cir. 188, 189 (Va. Cir. Ct. 1995).

E. Jurisdictions That Do Criminalize Rape by Fraud, Deception or Impersonation

Several jurisdictions have gone beyond the traditional common law position with respect to rape by fraud. These jurisdictions have sought to criminalize rape by fraud by providing different statutory solutions. Patricia J. Falk, in her extensive study, identified four different approaches that state legislatures have taken. First, some states "simply outlaw fraud in the context of certain professional relationships." This includes medical and health care professionals, psychotherapists and mental health professionals, or members of the clergy. Second, state legislatures have adopted a global consent definition in their criminal code declaring consent to be ineffective if obtained by "deception." See Falk, supra, at 89-132 and 169-71.

Third, states specify a very precise variety of fraud under which victim's consent is not a defense. This includes older provisions outlawing husband impersonation or fraud as to the nature of the act. See id., supra, at 169. Three states have added a newer provision where consent obtained by fraudulent means is deemed insufficient. Alabama criminalizes "a male, [who] engages in sexual intercourse with a female. . . with her consent where consent was obtained by the use of any fraud or artifice." ALA. CODE § 13A-6-65 (2013). Kansas defines rape as "sexual intercourse with a victim when the victim's consent was obtained through a knowing misrepresentation made by the offender that the sexual intercourse was a medically or therapeutically necessary procedure; or .... was a legally required procedure within the scope of the offender's authority." KAN. STAT. ANN. § 21-5503 (2013) (formerly cited as § 21-3502).

Lastly, California punishes "[e]very person who induces any other person to engage in sexual intercourse . . . when his or her consent is procured by false or fraudulent representation or pretense that is made with the intent to create fear . . ." CAL. PENAL CODE § 266c (2013). The California legislature amended its rape laws by including this new type of offense in response to Boro v. Superior Court. See 163 Cal.App.3d 1224 (1985). Boro posed as a doctor and tricked women into having sexual intercourse with them. He would tell the women that the act was necessary to cure their fatal blood diseases. The defendant would give them a choice of either undergoing a painful and expensive surgery or having sexual intercourse with a donor, the defendant, who had been injected with a special serum. The prosecution claimed that his actions fell under a statute prohibiting sexual intercourse with a victim who is unconscious of the nature of the act. See CAL. PENAL CODE § 261(4)(2012).

Boro appealed and argued that that statute did not cover his case. The Court of Appeals agreed and drew a distinction between fraud in the factum and fraud in the inducement, and held that only the former vitiates consent. The dissent argued that under the California statute that defines consent, although not repealing the factum-inducement distinction, it restricted consent to "cases of true, good faith consent, obtained without substantial fraud or deceit." See Boro, 163 Cal.App.3d at 1231-32 (Holmdahl, J., dissenting). Eventually the California legislature passed a new statute criminalizing this conduct. Ironically, Boro was apprehended again in 1987 for the same scam and prosecuted under this new law that was specifically designed for him.

The fourth and final approach taken by state legislatures is adopted by Tennessee, which simply revised parts of its sexual offenses statutes to encompass, without limitation, sexual penetration "accomplished by fraud." TENN. CODE ANN. §§ 39-13-503, 39-13-505 (2013). Cases such as State v. Tizard have treated this statute as effectively abolishing the traditional fraud in the factum-fraud in the inducement distinction. See 897 S.W.2d 732 (1994). In Tizard, the defendant was convicted on two counts of sexual battery for allegedly having sexual contact with the victim by means of fraud. The victim sought the need of a doctor in order to obtain steroids to help him gain muscle so that he can compete in future karate tournaments. During several visits the doctor rubbed the patient's genitals, and on one occasion caused the victim to ejaculate.

The state prosecuted the defendant under it sexual battery statute that included a fraud provision. The defendant cited the California case of Boro v. Superior Court, 163 Cal. App.3d 1224 (1985), and argued that the statute only reached fraud in the factum and not fraud in the inducement. The court did not find the defendant's arguments persuasive and rejected the distinction in the context of Tennessee law. See Tizard, 897 S.W2d at 741. Furthermore, the court noted that the state legislature included fraud "in its statutory definition of fraud and its criminalizing sexual contact accomplished by fraud." Therefore, the court convicted Tizard and concluded that he used his position as a doctor to touch the victim's genitals for his own sexual arousal or gratification. He did not touch the genitals for any medical purposes, noting that it "was accomplished under the guise of medical examination and treatment for the purpose of having the victim allow such touching." See id. at 742.


A. Legislative Addition is Needed to Extend Rape Law to Include Sexual Intercourse Obtained by Fraudulent Means

The Hough decision is a proper interpretation of Penal Law §130.05, since fraud is not defined as a lack of consent with regards to sex offenses. Furthermore, the Evans and Hough decisions are also proper because both distinguish between force and fraud and are consistent with the opinions of many jurisdictions. Additionally, the acknowledgment made by the court in Hough by pointing to the role of the legislature, demonstrates the respect the courts have for the balance of power between the legislature and the judiciary. Evans and Hough, having been decided in 1975 and 1994 respectively, stress the point that the defendants have committed wrong and immoral acts. However, the courts overturned the convictions solely because there was no such statute criminalizing them for their actions.

Although no New York court has dealt with the issue of sexual intercourse obtained by fraudulent means in almost 20 years, a legislative addition is needed to extend rape law, specifically Penal Law § 130.35, to include cases where consent is obtained by fraudulent means. The fact that the Hough court acknowledged its inability to judicially legislate since it is beyond the role of the judiciary, leaves only the legislature to enact a statute prohibiting rape by fraud. And although a court in New York has not encouraged the legislature to amend the rape statutes, the fact that other state legislatures have adopted rape by fraud statutes should inspire New York to do the same. See Falk, supra, 89-132, 169-71; see also LaFave, supra; see also Jocelynne A. Scutt, Fraudulent Impersonation and Consent in Rape, 9 U. QUEENSLAND L.J. 59, 64 (1975).

At the same time, many state legislatures have not created statutory remedies for victims of rape by fraud. Nevertheless, this should not excuse defendants who misrepresent themselves and fraudulently obtain consent to sexual intercourse, since it is as wrong an act as if actual threat or force had been made. See Falk, supra, at 44. While traditionally, rape has been viewed as a crime of violence, it can also be viewed as a sexual offense, because the victim's sexual integrity and autonomy have been violated. Legislative reform would be vital since it will protect both the sexual and physical autonomy of victims. See Estrich, supra, at 1105.

The New York legislature has already made changes to Article 130 when the Sexual Assault Reform Act of 2000 was signed into law by Governor George Pataki. See Law of New York 2000, Chapter 1, available at http://www.criminaljustice.ny.gov/legal services/ ch1_sex_assault_reform_2000.htm. The legislature should continue on that path and create a new statute which criminalizes rape by fraud. By viewing rape as a violation of one's sexual integrity and not as a crime of violence, this new law would further the changes the New York legislature has already made and continue that legislative push to protect a victim's personal autonomy.

Legal commentators have been advocating for rape law to include obtaining consent for sexual intercourse by fraudulent means. Susan Estrich points out that "[l]ying to secure money is unlawful theft by deception or false pretenses, a lesser crime than robbery, but a crime nonetheless. Yet lying to secure sex is old-fashioned seduction-not first-degree rape, not even third-degree rape." See Estrich, supra, at 1120. Therefore, she suggests that a law should be enacted to "prohibit fraud to secure sex to the same extent we prohibit fraud to secure money, and prohibit extortion to secure sex to the same extent we prohibit extortion to secure money." Id. She does note however that such a law is quite broad and doesn't "make clear that loss of bodily integrity is a different and greater injury than loss of money and thus merits greater punishment." Id. at 1121. Nevertheless, this argument is still an important one in expanding rape law.

Commentators also argue that despite the widespread adoption, the dichotomy of fraud in the factum and fraud in the inducement is flawed. Patricia Falk claims that the distinction is "objectionable on several grounds." Falk, supra, at 159-61. She argues that it is of "dubious origin" and questions its emergence. Second, she notes that the distinction does not make sense and "provides little real assistance in differentiating between legally effective and ineffective consent." Id. at 159. Third, she points to the fact that the dichotomy "fails to accurately distinguish degrees of voluntariness." Id. at 160. By courts focusing on this distinction, they essentially ignore the issue of whether the consent of the victim was voluntary or not, the more important issue.

Lastly, Falk notes that Rollin Perkins and Ronald Boyce claim that this difference "is only 'controlling in the prosecution of offenses in which absence of consent is an element of the crime, but important in the prosecution of other offenses.'" Id. at 161. Falk further notes that based on Perkins' and Boyce's analysis, the distinction could lose its significance in jurisdictions where statutes change the nonconsent element or create new statutes criminalizing sexual battery or sexual extortion. See id.

B. Different Methods the New York Legislature Can Decide to Follow

State legislatures have responded to changing times and many have begun to amend their rape statutes to include consent obtained by fraudulent means for sexual intercourse. If the New York legislature were to follow the trend and adopt such a statute into their Penal Law, they have several different methods to choose from. The first method would be to simply outlaw fraud in the context of certain professional relationships. Such statutes would essentially protect victims by punishing those who occupy positions of trust (i.e., doctors, psychotherapists, lawyers, clergy-members etc.). Although this is a step in the right direction, it is limited. In cases like Hough and Evans, the defendant would still go unpunished because he did not commit the fraud in such a context.

The second method would be to declare a global consent definition declaring consent to be ineffective if obtained by "deception," following the Model Penal Code. Model Penal Code §2.11 (2013). For instance, the New York legislature could follow the Missouri legislature in defining consent to be invalid "if it is induced by force, duress, or deception. MO. ANN. STAT. § 556.061(5)(c) (2013). By following this method, the consent would be vitiated when it is acquired by fraud, and it would place no limitation on the requisite type of fraud. This provision would also abolish the factum-inducement dichotomy, thereby rendering the victim's consent ineffective. This is a good option for the New York legislature to take, but by itself it is not broad enough to make an amendment whereby there would be no loopholes. This option will help create an amendment to the rape statute, with the fourth method that will soon be discussed. By combining the two methods, together it will be a more beneficial amendment to adopt.

The third method would be to specify a very precise variety of fraud under which victim consent is not a defense. While this method is also a step in the right direction, these legislative reforms are useful only to the extent that they could extend liability to where consent is obtained by fraudulent means. The California legislature created a statute where consent obtained by false or fraudulent representation with intent to create fear is prohibited. See CAL. PENAL CODE § 266c (2013). This provision would only be appropriate to those cases where consent obtained by fraud will induce fear. Under the amendment, fraud alone is insufficient; the fraud needs to trigger fear for there to be liability, thus limiting the application of the statute.

California had another statute prohibiting spousal impersonation. See CAL. PENAL CODE § 261(a)(5) (West 2012). The statute prohibited and criminalized a perpetrator who has sexual intercourse with a person by impersonating the victim's spouse. The limitation of this statute was seen when the Court of Appeals of California decided the case of People v. Morales. 212 Cal. App.4th 583 (2013). In Morales, the victim "woke up to the sensation of having sex." Id. at 587. She was confused because she had decided earlier that night not to have sex with her boyfriend. But when light came through a crack in the bedroom door, she realized she was having sex not with her boyfriend, but with her brother's friend, the defendant. The defendant was eventually arrested.

The defendant was found guilty and convicted of rape of an unconscious person. The defendant appealed his conviction and the Court of Appeals reversed. The court reasoned that since there is a separate provision that makes sexual intercourse by impersonation rape, the statute only applies when the victim is married and the perpetrator impersonates the victim's spouse. However, here the court held, "reluctantly", "that a person who accomplishes sexual intercourse by impersonating someone other than a married victim's spouse is not guilty of the crime of rape of an unconscious person . . ." Id. at 595.

This ruling showed that such impersonation cases apply only to one's spouse, and not to anyone else. On September 8, 2013, the California legislature amended CAL. PENAL CODE § 261(a)(5) to now read: "Where a person submits under the belief that the person committing the act is someone known to the victim other than the accused..." However prior to that amendment of the statute the defendants in Hough and Evans did not commit their fraud in that context; therefore, they would've gone unpunished. With the new amendment to the statute, the defendants would be criminalized for their actions.

Kansas also amended its rape statute to include rape by fraud where consent is obtained through "knowing misrepresentation." See KAN. STAT. ANN. §§ 21-5503(a)(4) 21-5503(a)(5) (2013). This type of fraud, however, is limited to only two categories, knowing misrepresentation in the context of medically or therapeutically necessary procedure and abuse of authority. This statute also restricts itself and is therefore incomplete, and would not punish the defendants in Hough and Evans.

C. Revisions to the New York Penal Law Rape Statutes

i. Tennessee's Rape Statute as a Model for a Revision of Rape in the First Degree

The fourth method that the New York legislature can take is revising their rape statute to include without limitation, sexual penetration "accomplished by fraud," as the state of Tennessee has done. TENN. CODE. ANN. § 39-13-503 (2013). The Tennessee legislature defines rape as the "unlawful sexual penetration of a victim by the defendant or of the defendant by a victim accomplished by any of the following circumstances . . . (4) The sexual penetration is accomplished by fraud." TENN. CODE. ANN. § 39-13-503(a)(4) (2013). Furthermore, such fraud is defined "as used in normal parlance and includes, but is not limited to, deceit, trickery, misrepresentation and subterfuge, and shall be broadly construed . . ." TENN. CODE. ANN. § 39-11-106(a)(13) (2013).

Using Tennessee's statute as a model, New York Penal Law § 130.35 should be amended to look as follows:

A person is guilty of rape in the first degree when he or she engages in sexual intercourse with another person: 1. By forcible compulsion; or 2. Who is incapable of consent by reason of being physically helpless; or 3. Who is less than eleven years old; or 4. Who is less than thirteen years old and the actor is eighteen years old or more; or 5. By accomplishing such sexual intercourse by fraud. Rape in the first degree is a class B felony.

Tennessee's fraud definition should also be added to the sex offenses definitions of terms in New York Penal Law § 130.00. This addition would be helpful because the new rape statute will be broadly construed and apply to a variety of situations where consent is obtained by fraudulent means, not having to be limited in scope with statutes that specify the fraud. See State v. Tizard, 897 S.W.2d at 742.

Under this amendment three elements would be required: (1) sexual intercourse, (2) some type of fraud, and (3) lack of consent. Since it is an element in every sex offense in New York that a "sexual act was committed without consent of the victim," the legislature should add a new definition of lack of consent to the New York Penal Law § 130.05. It will thus read "2. Lack of consent results from: ... or; (e) a mistaken belief resulting from an actor's alleged fraud." Now courts will be able to punish defendants that obtain consent through fraudulent means for sexual intercourse.

This last option seems like the best choice for the New York legislature to take in amending the Penal Law, however, there are counterarguments to such a change. A concern by many in expanding the scope of rape by fraud liability is where to draw the line between criminal fraud and noncriminal fraud. See JOSHUA DRESSLER, UNDERSTANDING CRIMINAL LAW 595 (5th ed. 2009). While many agree that spousal impersonation and fraudulent medical treatment should be criminalized, many also struggle with situations of exaggerations of affection, romance, social status, and wealth. Many worry that criminalizing rape by fraud too broadly would "open a Pandora's box that cannot be closed." Christopher & Christopher, supra, at 106. Examples could stretch as far as criminalizing every male who falsely claims his love to a female or promises to marry the female just to secure her consent for sexual intercourse. See DRESSLER, supra, at 595.

Other counterarguments include cases where definitional challenges for the crime of rape come up. This argument brings back the discussion of whether the act of rape is a crime of violence or a sexual offense, and thus whether the function of rape law exists to protect the victim's physical security or there sexual autonomy. See Falk, supra, at 45. Also, because generally these cases lack physical force, and consent is present, it conflicts with the traditional doctrine of rape law. This concern raises issues such as the relationship between the elements of force and nonconsent, whether physical force is actually needed, and what is considered a legally effective consent. See id. at 45-46.

By enacting such an amendment to Article 130, the legislature will allow the courts to decide for themselves whether such cases are indeed rape by fraud crimes. If the New York legislature were to adopt this amendment, it must trust the courts to fulfill their primary objective of interpreting and applying the laws. This adoption would leave the courts the responsibility of deciding on a case by case basis whether the accused has committed fraud according to the new definition in § 130.00.

Although there are concerns that this new adoption could lead to broad interpretations that perhaps were never thought to encompass before, it should not prevent the legislature from enacting laws that will ultimately protect victims' sexual and personal autonomy. Therefore, the legislature should adopt this broad amendment to the New York Penal Law criminalizing sexual intercourse accomplished by fraud, leaving the task of interpretation to the courts.

ii. Second Option: Changes to Rape in the Third Degree

If the New York legislature chooses not to adopt the Tennessee statute, it can adopt the second method mentioned earlier. If the legislature decides that the Tennessee statute is too broad, a statute criminalizing rape by fraud can still be enacted as a lesser crime under Rape in the Third Degree, § 130.25. This statute would focus solely on the consent of the victim. The legislature can create a global consent definition essentially declaring the victim's consent to be ineffective if obtained by "deception."

By creating a new definition of ineffective consent, the legislature can make a change to Rape in the Third Degree. One of the elements that satisfy a conviction for rape in the third degree is "when: ... (3) He or she engages in sexual intercourse with another person without such person's consent where such lack of consent is by reason of some factor other than incapacity to consent." The legislature can include rape by fraud by including the new definition of a lack of consent that was mention previously. This new definition would be a mistaken belief resulting from an actor's alleged fraud.

If the New York legislature would add this new lack of consent definition to §130.05, it would satisfy the third element of §130.25. Since this type of "lack of consent" is by reason of some factor other than incapacity to consent, a defendant who obtains a victim's consent to sexual intercourse by fraudulent means would meet this new requirement under Rape in the Third Degree. By creating this new definition, the New York legislature can adopt an alternative amendment that would punish accusers of rape by fraud as a lesser crime, but a crime nonetheless.

IV. Conclusion

Although a case of rape by fraud has not appeared before a judge in a New York courtroom in almost twenty years, it should not stop the New York legislature from adopting a statute that makes sexual intercourse accomplished through fraud a punishable crime. This legislative change is necessary to guarantee that perpetrators who obtain sexual intercourse by fraudulent means not go unpunished. The New York legislature must follow the trend of the nation and continue to make laws that protect victims of rape.

Daniel J. Slomnicki is expecting to graduate from St. John's University School of Law in January 2014. He graduated from Touro College in 2009 with a degree in Political Science. He served as a legal intern for the Richmond County, Kings County, and Queens County District Attorney's Offices, and is pursuing a career in criminal law. He is a member of St. John's Polestino Trial Advocacy Institute. He lives in Staten Island with his wife and their son. The author would like to extend a special thank you to Dean Larry Cunningham for his editorial advice and support.

"Saving Grace: The First Amendment On Trial In United States v. Apel" by Benjamin Pomerance

Saving Grace: The First Amendment On Trial In United States v. Apel
by Benjamin Pomerance

On December 4, one of the fundamental tenets of American democracy will be on trial before the United States Supreme Court. The First Amendment as we know it hangs in the balance of the outcome. A peaceful protester's rights are at stake, and with it the very ability to speak and express one's political views in a public setting. How the Court will resolve this case is, at this point, very unclear. Yet if a majority of justices rule in a certain way, concerned citizens in every corner of our nation will feel the chilling effect on their freedom.

This article examines the case that will lead to this monumental outcome and the precedents of liberty under review in this conflict. Part I discusses the judicial legacy forged in the United States to protect freedom of speech and expression in a traditional public forum, such as a public sidewalk or street. Part II describes the controversy at the core of United States v. Apel, the case in which the Supreme Court will hear oral arguments in December. Lastly, Part III examines the rationale that the Court, applying decades of worthy precedent, should follow in this case. This Court, if it truly is serious about safeguarding the First Amendment, must not weaken the shield that currently defends political protesters in America's public places.

I. A Heritage Of Encouraging Dissent: The Supreme Court's History Of Protecting Speech And Expression In A Traditional Public Forum

A. The Background

Since 1791, the First Amendment has stood as a cornerstone of American values. The First Congress took the remarkable step of limiting its own ability to pass certain laws -- in this case, any law restricting the freedoms of speech, religion, press, assembly, and petition -- because of a necessity learned the hard way under British domination: a strong central government, without instituting proper restraints, quickly treads hard on the essential liberties of its subjects. See, e.g., AKHIL REED AMAR, AMERICA'S CONSTITUTION: A BIOGRAPHY 315-18 (2005).

The 10 amendments passed by that Congress and ratified by the states represent the freedoms that the American governments, both state and federal, held most sacred. See ID. The inclusion of free speech at the top of that list was not surprising, given that many of the political thinkers influential to the early American statesmen -- from John Milton to Thomas Paine -- wrote strongly about the vital place of uninhibited expression in free societies. Consequently, many of the Framers of American government followed the rationale expressed by Benjamin Franklin in 1722: "Whoever would overthrow the liberty of a nation must begin by subduing the freeness of speech." Benjamin Franklin, Silence Dogood (letter), No. 8, July 9, 1722 (printed in The New-England Courant).

Through the ensuing years, however, the American government has subdued the freeness of speech and expression in multiple ways. For example, the United States Supreme Court has frequently held that "obscene speech" concerning sex may be banned to protect "the social interest in order and morality." See Miller v. California, 413 U.S. 15, 27 (1973); Roth v. United States, 354 U.S. 476, 483 (1957). Speech proposing a commercial transaction receives less First Amendment protection than "other constitutionally guaranteed expression" and can be limited in multiple ways by legislation. See, e.g., United States v. Edge Broadcasting Co., 509 U.S. 418 (1993). Intentionally defamatory expressions, particularly those against private citizens, can be punished by law. See, e.g., Gertz v. Robert Welch, Inc., 418 U.S. 323 (1974). Children frequently see courts curtail their ability to speak freely inside school grounds. See Morse v. Frederick, 127 S.Ct. 2618, 2624 (2007); Hazelwood School Dist. v. Kuhlmeier, 484 U.S. 260 (1988). And the list of judicially approved First Amendment limitations can go on and on.

Yet there is one First Amendment category that the United States Supreme Court has largely vouchsafed over time: speech and expression in a traditional public forum.

B. Hague And Schneider -- Early Public Forum Doctrine

Caselaw affirming First Amendment protections in a public forum dates back to at least 1939, the year that Jersey City Mayor Frank "Boss" Hague tried to ban union rallies in public places. When the Committee for Industrial Organization sued, the Supreme Court ultimately held that the mayor's ban on political meetings in public places violated the freedom of assembly guarantee in the First Amendment. See Hague v. Committee for Industrial Organization, 307 U.S. 496 (1939).

"[S]treets and parks . . . have immemoriably been held in trust for the use of the public, and time out of mind, have been used for purposes of assembly, communicating thoughts between citizens, and discussing public questions," wrote Justice Owen J. Roberts for the Court's majority. "Such use of the streets and public places has, from ancient times, been a part of the privileges, immunities, rights, and liberties of citizens." Id. at 515.

During that same year, the Supreme Court considered another case arising out of New Jersey, an appeal brought by Jehovah's Witnesses charged with violating local ordinances that prohibited people from distributing pamphlets on city streets. See Schneider v. New Jersey, 308 U.S. 147 (1939). Municipal leaders supporting the ordinances argued that the laws were necessary to prevent people from littering the local roads with discarded handbills. Id. at 161.

Yet the Court was not persuaded. "We are of opinion that (keeping) the streets clean . . . is insufficient to justify an ordinance which prohibits a person rightfully on a public street from handing literature to one willing to receive it," Justice Roberts stated in the majority opinion. "Any burden imposed upon the city authorities in cleaning and caring for the streets as an indirect consequence of such distribution results from the constitutional protection of the freedom of speech and press." See id.

C. Public Forum Evolution In The '60s

In the subsequent decades, the Court heard multiple cases involving protests in streets, sidewalks, parks, and other traditionally public places, particularly during the Civil Rights Movement in the 1960s. See, e.g., Cox v. Louisiana, 379 U.S. 559 (1965); Brown v. Louisiana, 383 U.S. 131 (1966); see also Adderley v. Florida, 385 U.S. 39 (1966). Essentially, the takeaway from these decisions was as follows: Speech or expression in public settings is permissible even if it angers members of the public, although governmental leaders may terminate the speech if the originally peaceful expression becomes violent or unduly disruptive. See, e.g., Cox, supra; Brown, supra. Speech on state-owned property, such as a jail driveway, received far less protection, and could be limited when government interests such as safety and protection of property were at issue. See Adderley, supra.

D. Flower and Greer -- Traditional Public Forum In The Military Context

An even stronger affirmation of First Amendment protections in traditional public forums occurred in 1972, when the Court upheld free speech interests over the objection of the United States Armed Forces. See Flower v. United States, 407 U.S. 197 (1972). In this case, military police arrested a civilian protester who was peacefully passing out leaflets on a public street running through Fort Sam Houston in Texas. Id. at 197-98. Since that civilian had been previously barred from Fort Sam Houston by the base commander, the government succeeded in convicting the civilian under a federal law making it a crime to knowingly re-enter a military post after being excluded from that base by any officer. See 18 U.S.C. §1382.

Yet the Supreme Court overturned the conviction. In a per curiam opinion, the Court pointed out that no sentry guarded either entrance of the street on which the protester had stood. Flower, 407 U.S. at 198. In fact, traffic flowed freely along this road 24 hours a day. Id. The street, therefore, was a traditional public forum, just like any other public thoroughfare. Id. Speakers on it were thus entitled to the same significant First Amendment safeguards afforded to any other citizen in such a location. Id. at 198-99.

The fact that the military claimed an interest in regulating this portion of the street did not outweigh the First Amendment interests at stake. Id. at 198. "Under such circumstances, the military has abandoned any claim that it has special interests in who walks, talks, or distributes leaflets on the avenue," the Court reasoned. "The base commandant can no more order petitioner off this public street because he was distributing leaflets than could the city police order any leafleteer off any public street." Id.

Four years later, a similar scenario came before the Court -- but with one game-breaking difference. In the case of Greer v. Spock, the nine justices again evaluated the case of individuals passing out pamphlets on a road that ran through a military base. See 424 U.S. 828, 832-33 (1976). In this situation, however, the street and sidewalks in question were located solely within the guarded grounds of Fort Dix. Id. at 837. Thus, the Court determined that because the roadway was separated from the streets and sidewalks of the city, and were not freely traveled by the general public, the street in question was not a traditional public forum. Id. Unlike Flower, the military had not abandoned its interest in controlling speech and conduct on this road, and the speech in question could be proscribed without violating the First Amendment. Id.

E. The Framework Of Perry

The question of when the government can restrict expressive conduct that does take place in a traditional public forum, however, was not clarified until 1983. In the matter of Perry Education Association v. Perry Local Educators' Association, the Court stated that an absolute ban on speech and expression in a traditional public forum would virtually always violate the First Amendment. See 460 U.S. 37, 45-46 (1983).

The government may, however, enforce reasonable time, place, and manner restrictions on speech and expression in traditional public forums -- but only if these restrictions "are content-neutral, are narrowly tailored to serve a significant government interest, and leave open ample alternative channels of communication." Id. at 45. Thus, the Court made it clear that where speech in a traditional public forum is at question, the government carries a heavy burden to overcome before the Court will even consider upholding such a restriction.

F. Protections Of Grace (And Beyond)

The keynote case demonstrating the safety net around expression in a traditional public forum, decided shortly after the Perry Court articulated this set of standards, was United States v. Grace. Ironically, the controversy in this matter focused on the United States Supreme Court itself. See United States v. Grace, 461 U.S. 171, 172 (1983).

Two people standing on the sidewalk in front of the Supreme Court building in Washington, D.C., on separate occasions -- one handing out pamphlets protesting political issues, the other carrying a sign on which the text of the First Amendment was inscribed -- were ordered by police officers to leave, and told that they would be arrested if they failed to comply. See id. at 172-74. The federal government argued that the officers were justified in doing so, because Title 40 of the United States code prohibited distributing leaflets and displaying signs favoring or opposing "any party, organization or movement" on Supreme Court grounds. See id. at 175.

Again, however, the Court strongly disagreed with the government. There was no doubt, according to the Court's majority, that the sidewalk around the Supreme Court building qualified as a traditional public forum. Grace, 461 U.S. at 179-80. The fact that this particular sidewalk surrounded a particular federal building did not give the government the right to strip away its traditional public forum character. Id. No fence, separation, or barrier indicated that this part of the sidewalk differed from any other part of this heavily traveled public walkway. Id. at 179. The government therefore lacked the right to ban speech in this public thoroughfare. Id. In perhaps the Court's strongest-ever affirmation of traditional public forum First Amendment safeguards, Justice Byron White wrote the following:

"Traditional public forum property occupies a special position in terms of First Amendment protection and will not lose its historically recognized character for the reason that it abuts government property that has been dedicated to a use other than as a forum for public expression. Nor may the government transform the character of the property by the expedient of including it within the statutory definition of what might be considered a nonpublic forum parcel of property. The public sidewalks forming the perimeter of the Supreme Court grounds, in our view, are public forums and should be treated as such for First Amendment purposes."

Id. at 180.

Given that the prohibition on picketing and distributing written materials on the sidewalks around the Court amounted to a total ban rather than a restriction on the time, place, or manner of the speech, the Court held this law to be unconstitutional. Id. at 183-84. The government's assertions that such a law was necessary to maintain the order, dignity, and security of the Supreme Court did not, in the eyes of the Court itself, survive the strict scrutiny of such a bar on expression in a traditional public forum. Id.

Three decades have passed since the Court's decision in Grace, yet the bedrock concept from this case remains firm. More recent challenges to speech and expression in public streets, public sidewalks, and public parks have all triggered the heavy level of scrutiny required by a traditional public forum. See, e.g., United States v. Kokinda, 497 U.S. 720 (recognizing that even streets in normally quiet residential areas qualified as traditional public forums); Frisby v. Schultz, 487 U.S. 474, 480 (1988) (calling public streets "the archetype of a traditional public forum"). Now, however, with the upcoming oral arguments in United States v. Apel, this important tradition of protecting speech in traditional public forums against undue government restrictions will be challenged yet again. How this current Court will handle this latest First Amendment controversy remains to be seen.

II. Today's Challenger: The Issues Confronting The Court In United States v. Apel

The facts in United States v. Apel follow a pattern that by now seems familiar. A peaceful protester, John Apel, was arrested for demonstrating on a public road. See Apel v. United States, 676 F.3d 1202 (9th Cir. 2012). The portion of the road in question, California's heavily traveled Highway 1, overlaps the boundaries of Vandenberg Air Force Base. See id. However, this segment of Highway 1 does not belong to the military base. Instead, since 1962, the State of California and the County of Santa Barbara have held an easement over this roadway. See id. There is no dispute over the validity of this easement. Law enforcement authority in this area concurrently belongs to the State of California and the County of Santa Barbara, as well as Vandenberg Air Force Base. See United States v. Apel, No. 12-1038, Brief in Opposition to Petition for a Writ of Certiorari, at 2.

On a previous occasion, Vandenberg's commander excluded Apel from the premises of the base. Apel v. United States, 676 F.3d at 1202. Apel returned to the base to protest, remaining at all times within a specified area on Highway 1 designated by the base for public protests. See Brief in Opposition to Petition for a Writ of Certiorari, at 4. He was convicted under federal law for knowingly re-entering a military base after being excluded from it by an officer -- the same statute that was used to convict the ultimately successful appellant in Flower. Apel v. United States, 676 F.3d at 1202; see Flower v. United States, 407 U.S. 197.

Apel appealed the outcome of his trial. The Court of Appeals for the Ninth Circuit reversed the trial court's decision, summarily ruling that because the federal government lacked exclusive possession of the area on Highway 1, the statute barring re-entry into a military base did not apply to this case, and Apel's conviction thus had to be overturned. Apel v. United States, 676 F.3d at 1202. In this short opinion, the Ninth Circuit did not even reach the First Amendment issue of whether Apel's conduct qualified as protected expression within a traditional public forum.

On appeal to the Supreme Court, the government now argues that the Ninth Circuit misapplied the law, and that nothing in the statute in question requires exclusive federal jurisdiction over the military base property in order to convict. See United States v. Apel, No. 12-1038, Reply Brief for the Petitioner, at 1. The government further states that to rule otherwise would threaten national security interests, asserting that "the Ninth Circuit's approach threatens substantial harm to the safe and orderly operation of many of this Nation's military installations." Id. at 1-2.

As for the First Amendment questions raised by this case, the government requests that the Supreme Court not decide this case on federal constitutional grounds because the Ninth Circuit did not raise constitutional issues in its decision. Id. at 5. Even if the Court were to decide the case on First Amendment principles, however, the government claims that because the statute prohibiting re-entry onto a military base applies to all people equally, and because this law "serves a significant government interest by barring entry to a military base by persons whose previous conduct demonstrates that they are a threat to security," the First Amendment would not protect Apel's actions. Id.

III. A Just Outcome: Why The Supreme Court Should Maintain Its Valuable Precedent By Recognizing Proper First Amendment Protections For This Conduct

There is no denying that the government's statutory argument in Apel makes a strong point: namely, the lack of an exclusive control requirement within the statute itself. The text of the federal law criminalizing a party's knowing re-entry to a military base after being ejected from that base includes no provision demanding exclusive federal jurisdiction over the base property. See 18 U.S.C. §1382 (2013). On the other hand, Apel's counsel demonstrates that caselaw dating back to 1948 does read an exclusive possession requirement into the law. See Brief in Opposition to Petition for a Writ of Certiorari, at 6. If this argument were to succeed, the concurrent jurisdiction of the state and county over this easement on Highway 1 would, as the Ninth Circuit held, prevent Apel's conviction under this federal law.

Potentially, the Supreme Court could decide Apel solely upon this issue, just as the Ninth Circuit did. Yet this current incarnation of the Supreme Court is extremely active in free speech jurisprudence. See Ronald K.L. Collins, Exceptional Freedom: The Roberts Court, The First Amendment, and the New Absolutism, 76 ALB. L. REV. 409 (2013). Since the appointment of John Roberts as Chief Justice, the Court has authored nearly 30 First Amendment free expression opinions, revealing a mixed record in this area. See id.

On one hand, this Court has recognized high First Amendment protections for extremely controversial forms of expression, including protesting with vulgar signs at a military funeral, selling violent video games to minors, profiting from making videos depicting extreme animal cruelty, and lying about receiving the Congressional Medal of Honor. See Snyder v. Phelps, 131 S.Ct. 1207 (2011); Brown v. Entertainment Merchants Ass'n, 131 S.Ct. 2729 (2011); United States v. Stevens, 559 U.S. 460 (2010); United States v. Alvarez, 132 S.Ct. 2537 (2012).

On the other hand, this Court has also proven its willingness to abridge free speech in cases where the government asserts national security concerns. See, e.g., Holder v Humanitarian Law Project, 130 S.Ct. 2705 (2010) (providing non-violent legal advice to a group designated as a suspected terrorist organization is not expression protected by the First Amendment); see also Marjorie Heins, The Supreme Court and Political Speech in the 21st Century: The Implications of Holder v. Humanitarian Law Project, 76 ALB. L. REV. 561 (2013).

From this short summary, it is clear that the Roberts Court is unafraid to leave its mark on the First Amendment. (For more on this Court's free speech record, see Panel Discussion on Recent U.S. Supreme Court Free Speech Cases and Their Implications, 76 ALB. L. REV. 781 (2013)). Thus, it seems likely that the Court will reach a First Amendment conclusion in deciding Apel. Based on the Court's past record, it is difficult to predict how the Court will resolve the First Amendment issues at work in this case. Yet if the Court chooses to remain true to its own laudable precedent regarding expression in a traditional public forum, there is only one outcome appropriate here.

A. Apel's Protest Constitutes Protected Activity In A Traditional Public Forum

There is no reasonable dispute that a peaceful protest on a political issue qualifies as conduct protected by the First Amendment. See, e.g., United States v. Grace, 461 U.S. 171, 176 (1983). The lone question remaining, then, is whether Apel delivered his protest in an area protected under the traditional public forum doctrine.

Highway 1 is a public street. As the cases discussed earlier in this article showed, public roads are recognized as traditional public forums in even the most limited interpretations of this rule. For instance, the Court in Perry Education Association v. Perry Local Educators held that only two areas are always viewed as traditional public forums, but that public streets are always one of these protected categories. 460 U.S. 37, 45 (1983). Public roadways are, in the words of the Court itself, "the archetype of a traditional public forum." Frisby v. Schultz, 487 U.S. 474, 480 (1988).

The lingering issue, though, is whether the presence of this portion of Highway 1 on Vandenberg Air Force Base destroys the traditional public forum character of this roadway. Put another way, the Court must decide whether this segment of Highway 1 is analogous to the road in Greer v. Spock, where the Court held that the street on the military base was not a traditional public forum, or whether this area is akin to the avenue in Flower v. United States, where the Court found that the street to be a traditional public forum despite its overlap with military property. See Part I, supra.

A reading of Apel's facts shows that the Flower analysis is a far better fit. Like the roadway in Flower, traffic flows freely all day long through this section of Highway 1. There are no sentries, checkpoints, or other indications to drivers, passengers, or pedestrians that this particular section of Highway 1 is different from the rest of this heavily traveled thoroughfare. See Brief in Opposition to Petition for a Writ of Certiorari, at 33. In fact, a public bus stop and a public middle school both stand very close to the area where Apel was protesting. Id. at 1, 3. Indeed, with the State of California and the County of Santa Barbara holding an easement over this stretch of road, the public character of this street is even more apparent than the roadway in Flower. Thus, here, as in Flower, the military has "abandoned any claim that it has special interest" in regulating speech and expression on this portion of Highway 1.

Equally influential in this analysis is the Court's decision in Grace. Justice White's majority opinion made it clear that a traditional public forum does not lose this status merely because it abuts government property. United State v. Grace, 461 U.S. 171,180 (1983). Thus, even though the Supreme Court building was not a place historically held open as a forum for speech and expression, the sidewalks surrounding it -- which were impossible to differentiate from any other sidewalks in the city -- remained a traditional public forum. Id. Similarly, while Vandenberg Air Force Base itself is not a traditional public forum, the public highway running unimpeded through this corner of the base does not lose the public forum protections afforded to public streets.

"The sidewalks comprising the outer boundaries of the (Supreme) Court grounds are indistinguishable from any other sidewalks in Washington, D.C., and we can discern no reason why they should be treated any differently," Justice White wrote in Grace. Id. at 179. The same principle applies to the segment of road at issue in this present controversy.

In fact, the only distinguishing mark on this portion of Highway 1 actually enhances the First Amendment standing of Apel's case. Back in 1989, Vandenberg Air Force Base personnel had painted a green line on the roadway outside the main gate of the base. Brief in Opposition to Petition for a Writ of Certiorari, at 2. This line designated a particular area on the road for peaceful protestors to use. Id. At all times during his protest, Apel remained inside this specified protest area. Id. at 4. Thus, Apel not only stood on a public street, an area safeguarded for decades as a traditional public forum, but protested within a region on that street assigned expressly for that purpose. If the street itself were somehow deemed not to be a public forum, the spot in which Apel stood clearly qualifies as a place "historically associated with the free exercise of expressive activities." Grace, 461 U.S. at 177.

Thus, it is evident that Apel conducted his protests at all times within a public forum. The government, therefore, may curtail his speech only through reasonable time, place, and manner restrictions, and only if these limitations are content-neutral, narrowly tailored to serve a significant government interest, and "leave open ample alternative channels of communication." Grace, 461 U.S. at 177. We now move to an examination of whether the government has met this substantial burden in Apel.

B. The Government Cannot Meet Its Required Burden, Making This Restriction On Apel's Speech Unconstitutional

As already noted, the federal government argues that overturning Apel's conviction would threaten "substantial harm to the safe and orderly operation of many of this nation's military operations." Reply Brief for the Petitioner, at 10. A ruling in Apel's favor, according to the government, would place base commanders in a difficult position, forcing them to either ban all civilian traffic on military property or to tolerate "disruptive and even dangerous conduct by repeat offenders who refuse to comply with base rules and regulations." Id. Additionally, the government claims that any previous violator of base policies "remains a threat to enter the base and cause harm to persons or property" therein, thus giving the government a compelling interest in excluding them. Id. at 10-11.

Still, these reasons seem to fall well short of demonstrating a significant government interest in criminalizing Apel's peaceful protest. To begin with, the government deals solely with generalities in these arguments, painting with broad brush strokes the specter of "substantial harm to the safe and orderly operation" of America's military facilities. Never does the government proffer any concrete examples of precisely how Apel's demonstration on a public highway threatened the "safe and orderly operation" of Vandenberg Air Force Base. In fact, the government fails to describe how such protests would disrupt security and order at any American military installation. These vague scare tactics by the government, without more, should not be enough to outweigh the First Amendment interests of protecting expressive conduct in a traditional public forum.

The government's most material claim centers on the concern that base commanders will be forced to ether restrict all civilian traffic or frequently tolerate disruptive and dangerous conduct by "repeat offenders." Yet this prediction is unfounded. Caselaw clearly shows that the government retains the right to stop expressive conduct in a traditional public forum if that speech or expression provokes violence, imminent danger, or other undue disruptions. See, e.g., Cox v. Louisiana, 379 U.S. 559 (1965); Brown v. Louisiana, 383 U.S. 131 (1966). Therefore, allowing Apel's non-violent, non-threatening protest will not expose military bases to the dire future that the government hypothesizes. Military leaders will continue to retain the right to end speech and expression in a traditional forum in those exceptional circumstances where the speech or expression causes violence or clearly puts the safety of others in danger.

Just as the Grace Court found no evidence that the appellants had obstructed the sidewalks around the Supreme Court building, nothing in this case suggests that Apel's presence on this public road endangered Vandenberg Air Force Base in any way. See Grace, 461 U.S. at 182. Thus, the federal government cannot meet its burden of showing that this law is narrowly tailored to serve a significant state interest. Apel's conviction for protesting in a traditional public forum deserves to be overturned on First Amendment grounds.

IV. Final Thoughts

After the Court hears oral arguments in Apel on December 4, the wait will begin to see how, if at all, the First Amendment as we know it will change. As this article demonstrates, the Court should follow the precedent set down in Grace, Flower, and so many other cases solidifying constitutional protections of speech and expression in a traditional public forum. This discussion showed that Apel peacefully protested at all times in the most established of all traditional public forums -- a public street -- and that the military base's proximity to this street does not deprive it of public forum status. It further described how the government does not even come close to proving that this law barring any re-entry to the base is narrowly tailored to serve a significant state interest.

The Court should not permit this conviction of a non-violent protester in a traditional public forum to stand. Doing so would reverse decades of precedent in this area of the law. Even more detrimentally, it would weaken one of the fundamental precepts for which the First Amendment stands: the ability to speak and express freely, particularly in areas traditionally held open for these essential democratic activities.

"Speech is powerful," Chief Justice Roberts wrote in Snyder v. Phelps, the case holding that protestors on a public sidewalk outside a military funeral received full First Amendment protection. "As a Nation we have chosen . . . to protect even hurtful speech on public issues to ensure that we do not stifle public debate." See 131 S.Ct. 1207, 1213 (2011). Truer words regarding the First Amendment were never spoken. Today, with the impending decision in United States v. Apel, America will soon find out if the Chief Justice and his brethren truly meant what they said.

Letter From The Editor

Dear Readers:

Two-and-a-half years ago, I wrote that we were attempting a reincarnation. The Law Student Connection, which lay dormant for a substantial period, was being revived.

Since that time, we have published multiple articles by student contributors from virtually every New York State law school. We have received thoughtful praise and comments from practitioners and scholars. We even were cited by one of the United States Courts of Appeals in a major decision. All in all, the reincarnation has created something lasting.

Now, it is time to say good-bye.

But only for me. I am no longer a law student, so I must leave. Yet the Law Student Connection will continue on after I go in the capable hands of another student editor-in-chief. The quality content -- all of it produced by New York law students -- that you have come to expect from this publication will continue long into the future.

Before I go, though, I am proud to announce our latest slate of articles. We begin with a look at an upcoming Supreme Court case that could re-shape a major aspect of First Amendment law. Next, Daniel J. Slomnicki argues for a significant change in New York's Penal Law, calling for New York to recognize "rape by fraud" as a crime. Continuing with the Criminal Law exploration, Samuel Yellen examines the "big data" at the hands of law enforcement agencies and the constitutional implications at stake when officials utilize this information.

In another controversial topic, Benjamin Kern looks at the Stockbridge-Munsee casino proposal, analyzing the unique areas of the law at issue in this dispute. Nicholas M. Herubin demands that fiduciary duties attach to brokers, stating that this is only fair for financial consumers. And Tracy J. Weinstein examines something that sounds like a product from a science-fiction novel: 3-D printing, with all of the legal concerns that this innovation entails.

I will end as my mother taught me: with a thank-you note. Thank you to Megan O'Toole, Barbara Beauchamp, and everyone else at NYSBA headquarters who took a chance on this publication and a chance on me. Thank you to every student who wrote remarkable articles for us, and to those students who will write articles in the near future. Lastly, thank you to all of you, our readers. Without your support, this reincarnation never would have happened. Yet it has -- and it is here to stay.


Benjamin Pomerance


About November 2013

This page contains all entries posted to Law Student Connection in November 2013. They are listed from oldest to newest.

August 2013 is the previous archive.

Many more can be found on the main index page or by looking through the archives.