Coingate: A Juggernaut of Legal Error

Once upon a time, a man negotiated a deal to invest some money for a government agency. The investment did very well for nearly seven years. Then, the agency decided it didn’t like the arrangement and asked to dissolve it. As the lawyers worked to untangle things
, they discovered that some money wasn’t in the right accounts and that, even though the investor had clearly and visibly maintained legal responsibility for all the funds he had received, some money had been used temporarily for the investor’s personal expenses. The government lawyers then sued the investor and reached an out of court settlement in which the investor had to pay a small amount of money for potentially lost profits as well as for legal fees.

The man in this fable was not Tom Noe, who lives in the real world. Noe had the same experience as the investor described above, but the outcome was very different. Noe was involved in politics in an extremely partisan place, and the local newspaper publisher disliked him. When problems with the investment were revealed, a blizzard of stories and editorials cried “alleged theft!” The newspaper was powerful and times were tense with a critical election coming up, so politicians of both sides panicked and decided to either “get Noe” (the opposing party strategy) or “get him out of the way” (his own party’s approach). Together, this bipartisan alliance developed a search warrant that was completely dishonest, even containing some “recklessly false” statements. The warrant allowed seizure of Noe’s business together with his business records and many of his assets. All his employees lost their jobs. Then, the cooperating parties carefully crafted an audit of the investment that singled out Noe and focused on only one aspect of his business, completely ignoring its overall operations and profits.

The county prosecutor’s office, controlled by the opposing political party, charged Noe with an array of crimes, including RICO (Racketeer Influenced and Corrupt Organizations). The local judge, against whom Noe had filed ethics charges, refused to recuse himself. The state Supreme Court refused to intervene.

By the time Noe went to trial 18 months after the search warrant, the local newspaper had published some 750 articles and letters on his case. Also, there were many editorials focusing on “alleged theft!” Television and radio stations repeated the newspaper’s message. This intensely negative coverage meant that, when interviewed, a large proportion of the prospective jurors said they were biased against Noe or had heard negative information about him. But the judge kept most of them in the pool and some of them actually served. And the judge refused to move the trial elsewhere. Finally, although the prosecution consistently but indirectly suggested to the jury that the overall investment had lost money, the judge denied the defense the right to present evidence of profitability. Just after his ruling, the newspaper gave the judge a very strong and prominent endorsement for election to a higher court.

The jury convicted Noe on RICO and theft and other charges and the judge sentenced him to far more than the minimum:  18 years with no reasonable chance of early release. The day after the conviction, the state announced that its investment would likely make a profit.
The Appeals Court, operating in the same county with the same newspaper watching, agreed entirely with the discretionary decisions of the trial judge – who was now one of their colleagues. Other courts also deferred to the trial judge, and Noe has been in state prison for nine years with nine more to go.

A careful analysis of Tom Noe’s saga reveals a juggernaut of legal error. The search warrant was a deliberately misleading concoction. The prosecutor had multiple conflicts of interest and should never have had a role. The same is true for the trial judge. The state Supreme Court, with multiple conflicts of its own, including some emanating from an extremely harsh partisan environment, refused to take the long view and instead acted on expediency.

Finally, an analysis of psychological research shows that Noe could not have received a fair trial in his home region. Intense and slanted media coverage clearly biases jurors, both directly and indirectly through family, friends, and co-workers. And research on other aspects of bias, notably its impact on people like prosecutors and judges, makes clear that these individuals could hardly have escaped strong even if subconscious negative feelings against Noe. This conclusion about the distorting role of primarily media-driven bias is reinforced by the fact that a review of cases similar to Noe’s in the past few decades shows much lighter charges, much shorter sentences, and much less time served. In fact, it appears that similar cases have typically been taken to civil rather than criminal court.
Tom Noe is a political prisoner, and the circumstances that have left him incarcerated are still very much present. Can we prevent more cases like this? Yes, but to know what to do we have to understand what happened to Noe. That is the purpose of Coingate.