Articles Posted in Texas Criminal Law Glossary

The term “white collar crime” refers to a wide range of offenses involving financial and commercial activities. Many federal statutes dealing with financial regulations have both civil and criminal enforcement provisions. This means that the government can bring a civil lawsuit, which could result in penalties and damages, or a criminal prosecution, which could result in a fine and a prison sentence. Antitrust law deals with monopolistic and other anticompetitive practices by businesses. Most federal antitrust cases involve civil enforcement, but one statute allows criminal prosecution by the Department of Justice (DOJ). An online retail company recently pleaded guilty to criminal antitrust violations in a Texas white collar prosecution. United States v. Zaappaaz, Inc., No. 4:17-cr-00477, information (S.D. Tex., Aug. 7, 2017). Its president also pleaded guilty to a similar charge. United States v. Makanojiya, No. 4:17-cr-00478, information (S.D. Tex., Aug. 7, 2017).

The Sherman Antitrust Act of 1890 was the first major federal statute addressing anticompetitive business practices. It prohibits contracts and conspiracies “in restraint of trade or commerce” across state lines. 15 U.S.C. § 1. The purpose of this statute, according to the Supreme Court, “is to protect the public from the failure of the market” by prohibiting “conduct which unfairly tends to destroy competition itself.” Spectrum Sports, Inc. v. McQuillan, 506 U.S. 447, 458 (1993). Criminal penalties may include up to 10 years in prison. Congress has amended the statute over the years to increase the monetary penalties. Originally, the law provided for a fine of up to $5,000. Since 2004, the maximum penalty has been $100 million for a corporation, or $1 million for an individual or an organization other than a corporation. Additionally, private parties may be able to file civil lawsuits for antitrust violations that directly caused them harm.

The corporate defendant is a Texas corporation that sells “customized promotional products, including wristbands and lanyards,” through several websites. Zaappaaz, information at 1. The government alleged that the defendant conspired with other e-commerce businesses involved in the sale of similar products “to suppress and eliminate competition by fixing and maintaining prices.” Id. at 2. The defendant allegedly made these agreements at in-person meetings or in communications through text messaging and social media platforms. This occurred from approximately October 2014 until about June 2016. The information in Makanojiya makes almost identical allegations against that defendant, identifying him as the president and director of the corporate defendant.

“Theft” is one of the most foundational offenses in criminal law, encompassing a wide range of alleged violations of other people’s property rights. The simplest definition of theft is taking someone else’s property without the owner’s consent. Each element of that definition, however, can be profoundly complicated, depending on the circumstances. Which sorts of acts constitute “taking” something? How should the law define the owner’s “consent” or lack thereof? State theft laws cover a wide range of acts. Texas has consolidated almost all Texas theft offenses under a single section of the Penal Code, but many states still have multiple theft offenses on the books. State prosecutors in Maine, for example, recently brought charges of “theft by deception” against a woman accused of obtaining more than $10,000 in donations by falsely claiming to have advanced breast cancer.

Criminal offenses that fall under the general legal category of “theft” include larceny, shoplifting, embezzlement, and false pretenses. The offense of “theft by deception,” under Maine law, involves “obtain[ing] or exercis[ing] control over property of another as a result of deception and with intent to deprive the other person of the property.” 17-A Me. Rev. Stat. § 354(1)(A). The statute defines “deception” as “an impression that is false and that the person does not believe to be true,” which a person “creates,” “reinforces,” or “fails to correct.” Id. at § 354(2).

In Texas, the consolidated “theft” statute includes multiple offenses previously defined separately, including “theft by false pretext.” Tex. Pen. Code § 31.02. Finding the equivalent of the Maine statute requires examining various definitions. “Theft” consists of “unlawfully appropriat[ing] property with intent to deprive the owner of property.” Id. at § 31.03(a). “Unlawful” appropriation of property can occur when the person does not have “the owner’s effective consent.” Id. at § 31.03(b)(1). “Effective consent” excludes consent that was “induced by deception or coercion.” Id. at § 31.01(3)(A). Finally, the definition of “deception” is similar to the one found in Maine. Id. at § 31.01(1).

The term “white collar crime” encompasses a wide range of offenses involving elements of theft or fraud. The offense of embezzlement, for example, involves outright theft from an employer. Other white collar offenses are more complicated and much more difficult for prosecutors to prove. Federal securities laws do not define a specific offense called “insider trading,” but it is a well-known term in this area of law. Insider trading is a type of securities fraud that involves the use of information that is not available to the public. This is usually “inside information” about a corporation that affects trades in that company’s stock. A recently filed indictment goes in a different direction, alleging the use of nonpublic information from a government agency. United States v. Blaszczak, et al., No. 1:17-cr-00308, indictment (S.D.N.Y., May 24, 2017). The case involves a relatively unknown industry known as “political intelligence,” in which consultants obtain information about government operations for clients.

The Securities Exchange Act of 1934 regulates the trading of securities. Insider trading occurs when a person who has inside access to a corporation with publicly traded stock uses information that is available to them as an insider, and therefore not available to the public, to make a decision about trading that corporation’s stock. This puts all other stockholders and potential stockholders at a disadvantage, and it can affect the market as a whole. If, for example, a corporate insider learns that the corporation is going to be the target of an upcoming government investigation, it might constitute insider trading for that insider to sell all or most of their stock before any public announcement of the investigation. The news is likely to have a negative effect on the stock’s price, but the insider has an unfair advantage because of their access to information.

Rather than corporate inside information, the Blaszczak case involves inside information about a government agency. The field of “political intelligence” is difficult to define. It essentially involves consultants with access to government officials. The consultants are able to obtain useful information about government operations for their clients, who are often hedge funds and other investors. In order to be valuable, the information must not be generally available to the public. In this way, it resembles inside corporate information.

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The term “probation” applies to a variety of outcomes in criminal cases, usually ordered by a court as an alternative to a jail or prison term. Courts impose sentences based on statutory authority and sentencing guidelines, and they often have discretion to “probate” sentences for a specified period of time. If the defendant abides by all of the conditions set by the court for the duration of the probation period, their case will be closed. If they do not meet all of the requirements, or they commit an act found to be in violation of their probation terms, the state may ask the court to revoke their probation. This can result in the imposition of the original sentence. When probation revocation coincides with another criminal case, the proceedings can appear very confusing. A recent case in a Georgia court, for example, involved a man acquitted in a criminal case but sent to prison anyway because of probation revocation.

Texas uses the term “community supervision” to refer to “a continuum of programs and sanctions” that a court may order. Tex. Code Crim. P. Art 42A.001(1). Two types of community supervision are possible:

– “Probation” generally refers to the suspension of a sentence after an adjudication of guilt, based on either a verdict or a plea. The court enters a finding of guilt or recognizes a plea of no contest and imposes a sentence. Rather than ordering the defendant to begin serving the sentence, however, the court orders that the sentence be probated, identifies the length of the probation period, and sets conditions for the defendant.
– “Deferred adjudication” is a form of community supervision in which the court accepts a defendant’s guilty or no contest plea, but it does not enter a final adjudication of guilt. Id. at Art. 42A.101. The court orders services and sanctions for the defendant, much like with probation.

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Marijuana possession under Texas drug crime laws ranges from a misdemeanor offense to a major felony, depending on the amount. The Texas Legislature passed a law in 2007 that allows a “cite and release” policy, rather than arrests, for minor marijuana possession and other misdemeanors. Some, but far from all, Texas cities have adopted this policy. Law enforcement officials in neighboring or overlapping jurisdictions might disagree over cite and release. For example, the District Attorney’s Office in Bexar County, where San Antonio is located, announced the implementation of cite and release last year, while the San Antonio Police Department and other local police departments have expressed disagreement with the policy.

Possession of small amounts of marijuana is a misdemeanor offense under Texas law. If the amount is no more than two ounces, it is a Class B misdemeanor, increasing to a Class A misdemeanor for an amount that does not exceed four ounces. Tex. Health & Safety Code §§ 481.121(b)(1), (2). A Class A misdemeanor carries a maximum penalty of one year in jail and a $4,000 fine. Tex. Pen. Code § 12.21. The maximum punishment for a Class B misdemeanor is half of that:  180 days in jail and a fine of $2,000. Id. at § 12.22.

The 80th Texas Legislature passed HB 2391 in May 2007. It took effect on September 1 of that year. Analysis of the bill noted the burdens on county jails throughout Texas, many of which were filled to capacity. The law at the time effectively required police to take people into custody for Class A and Class B misdemeanors. The bill amended Article 14.06 of the Texas Code of Criminal Procedure to create exceptions to this requirement. For certain offenses, police could issue a citation instructing a person to appear before a magistrate at a specified time and place, much like a ticket issued for a traffic violation. This applies to Class A and B marijuana possession, as well as certain misdemeanor offenses under the Texas Penal Code.

Pardons are part of the constitutional authority of an executive, such as the President of the United States or the Governor of Texas, in criminal cases. Late last year, the presidential pardon power was in the news after the president pardoned an Arizona sheriff who had been convicted of criminal contempt of court. This led to debates, both in and out of the courtroom, over the extent of the pardon power. In Texas criminal cases, the governor’s pardon power is specifically limited by the Texas Constitution, requiring the prior recommendation of a board appointed by the Texas Legislature.The U.S. Constitution grants the president the “Power to grant Reprieves and Pardons for Offences against the United States,” with impeachment as the only specified exception. U.S. Const. Art. II, § 2, cl. 1. The Office of the Pardon Attorney (OPA), part of the U.S. Department of Justice, accepts petitions for clemency for convictions in federal district courts, the Superior Court of the District of Columbia, and military courts-martial. See 28 C.F.R. § 1.1 et seq. The president may decide to issue a pardon, however, without the recommendation of the OPA, or even without a petition for clemency. Presidents may issue a pardon at any time during their term. Recent presidents have often issued multiple pardons shortly before leaving office.

The Texas governor has authority to grant full pardons “upon the recommendation and advice of a majority of the” Board of Pardons and Paroles (BPP). Tex. Const. Art. 4, § 11(b); 37 Tex. Admin. Code § 143.1. The governor can grant a temporary reprieve of up to thirty days in capital cases without going through the BPP. Recently, the governor of Texas has issued a small number of pardons at the end of each calendar year.
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A new law that took effect in Texas in September 2017 allows people with convictions for driving while intoxicated (DWI), if they meet various criteria, to petition for an order of nondisclosure. This order prevents state and local law enforcement agencies from releasing information about the arrest, prosecution, conviction, and sentence. In addition to the limitations on eligibility for DWI nondisclosure, the new law might exclude some people in possibly unexpected and unintended ways. Defendants charged with a Texas DWI should understand how the new law might apply—or not apply—to them when considering a plea agreement.

The Texas Penal Code classifies DWI as a Class B misdemeanor when a driver’s blood alcohol concentration (BAC) is at least 0.08 percent but less than 0.15 percent. Tex. Pen. Code § 49.04. If the BAC is 0.15 or higher, it is a Class A misdemeanor. Texas law allows two different types of “community supervision” as alternatives to the punishment prescribed by the Penal Code. Probation involves a formal finding of guilt after a guilty or no contest plea, followed by a period of time during which the punishment is probated. If the defendant successfully completes the services the court orders, the punishment is deemed completed. With deferred adjudication, the court accepts a guilty or no contest plea but does not make a formal finding of guilt. If the defendant abides by the court’s orders for a defined period of time, the case is dismissed with no final adjudication. Defendants charged with DWI are not eligible for deferred adjudication in Texas. Tex. Code Crim. P. Art. 42A.102(b)(1)(A).

The new DWI nondisclosure law, H.B. 3016, may apply to cases that ended with probation and cases in which the defendant served a sentence. It only applies to Class B misdemeanor DWI cases, and it excludes cases that involved vehicular accidents involving any person other than the driver, whether or not anyone was injured. The earliest date a person can file a petition for nondisclosure ranges from two to five years after the conviction date, depending on whether the defendant received probation and whether they were ordered to use an ignition interlock device.

Texas criminal proceedings are, in most cases, part of the public record. This means that anyone who knows where to look can obtain information about specific criminal cases, including arrest records and records involving probation and other outcomes. It is possible, in limited circumstances, to obtain an expunction or an order of nondisclosure, which directs public officials and agencies not to release information about a particular criminal case to the public. A new law passed by the Texas Legislature, H.B. 3016, expands the availability of nondisclosure orders in Texas DWI cases, with some exceptions.DWI is a misdemeanor criminal offense under Texas law. “Intoxicated” is defined as either lacking “the normal use of mental or physical faculties” because of alcohol or drugs, or having a blood alcohol concentration (BAC) of at least 0.08 percent. Tex. Pen. Code § 49.01(2). A DWI offense is ordinarily a Class B misdemeanor with a minimum jail sentence of three days, or a minimum sentence of six days if a defendant had an open container of alcohol in their “immediate possession.” Id. at §§ 49.04(b), (c). If a defendant’s BAC was 0.15 percent or more, however, it becomes a Class A misdemeanor. Id. at § 49.04(d).

The Governor of Texas signed H.B. 3016 into law on June 15, 2017. It took effect in September, and it applies retroactively to all DWI cases in the state, not just convictions entered on or after the effective date. The bill amended the provisions of state law that establish procedures for orders of non-disclosure, see, e.g., Tex. Gov’t Code § 411.074, and added new sections specifically addressing DWI cases at §§ 411.0731 and 411.0736.

In order to qualify for a nondisclosure order, a petitioner must not have been convicted of DWI as a Class A misdemeanor, with a BAC of 0.15 percent or higher. The DWI case also must not have involved an accident with another person, which could involve a driver of another vehicle or a passenger in the same vehicle, even if nobody was injured. The petitioner must have no prior convictions, including probation or deferred adjudication, for anything other than minor traffic offenses.

The right against self-incrimination is a well-known part of the U.S. Constitution, but it is not always well understood. Applying this principle in the real world, with all of its ambiguity and uncertainty, has proven quite challenging for the courts. The Fifth Circuit Court of Appeals recently ruled on a claim that police violated a person’s First, Fourth, Fifth, and Fourteenth Amendment rights by allegedly retaliating against a person after he refused to answer their questions. The court ruled for the plaintiff on his Fourth Amendment claims but not the other claims. Alexander v. City of Round Rock, No. 16-cv-50839, slip op. (5th Cir., Apr. 18, 2017). The case is a civil lawsuit, rather than a criminal prosecution, but its interpretation of the Fifth Amendment’s right against self-incrimination could affect future Texas criminal cases.

The Fifth Amendment’s protection against self-incrimination generally means that a person cannot be compelled or coerced into saying something that could place them in criminal trouble. A refusal to answer questions because of this right is commonly known as “pleading the Fifth.” The Fifth Amendment has also been interpreted as requiring courts to suppress confessions by defendants that were not given voluntarily. The caselaw remains unclear on which remedies may be available when a Fifth Amendment violation occurs outside the context of a custodial interrogation.

According to the court’s statement of the facts of the case, all drawn from the plaintiff’s complaint, an officer stopped the plaintiff “in a hotel parking lot after observing what he perceived as suspicious activity.” Alexander, slip op. at 1. The plaintiff stated that he had stopped his vehicle and gotten out to look for a stray cat he had seen. He told the officer that he would not answer any of his questions.

Law enforcement officials in Texas have used a variety of tools to help them investigate suspected drug-related offenses. Some of these tools have resulted in profound injustice in the form of wrongful convictions. A kit used by many officers around the state to test substances they believe are an illegal drug has returned “positive” results for substances later revealed to be innocuous. By the time more accurate test results were available in many of these cases, defendants had already pleaded guilty rather than risk going to trial against what police had represented as incontrovertible evidence of guilt. Now, the Houston Police Department has announced that it will no longer use these field kits, but not because of concerns about justice. Instead, the department cited risks posed to officers from opiate exposure during testing. Still, this is welcome news for Texas criminal defense advocates.

In any criminal prosecution, the state has the burden of proving every element of the charged offense, as it is defined by statute, beyond a reasonable doubt. Field-testing kits are often used by police to test substances believed to be cocaine. The relevant criminal charge would likely be possession of a controlled substance in Penalty Group 1. This would require proof beyond a reasonable doubt of four elements:  that a defendant (1) possessed a controlled substance (2) that is included in Penalty Group 1, (3) that the defendant did so “knowingly or intentionally,” and (4) that the defendant did not have a valid prescription for the substance from a medical doctor. Tex. Health & Safety Code §§ 481.102(3)(D), 481.115(a).

In a cocaine possession case, the prosecution must prove beyond a reasonable doubt that the substance is, in fact, cocaine. The requirement of proof beyond a reasonable doubt means that the “finder of fact” concludes that no reasonable doubt exists as to whether the substance is cocaine. The “finder of fact” is either the judge presiding over the case or a jury of the defendant’s peers. Results from a drug-testing kit routinely used by police can appear very convincing, unless the defendant is able to challenge the accuracy or validity of those test results. An innocent defendant without the resources to challenge the test results might choose to plead guilty rather than risk turning the decision over to a jury.

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