Constitutional Law Criminal Law Litigation

Federal Court Refuses to Reverse Conviction Based on Contingency Fee Agreement

Contingency fees in criminal cases are not only frowned upon, they are “per se unethical.” See, People v. Winkler 71 NY2d 592 (1988), where the NY Court of Appeals stated: “These arrangements are thus met with universal disapproval and, as a matter of strong public policy, we join in all appropriate efforts to discourage and sanction them.” DR 2–106(C) of the Code of Professional Responsibility makes it a breach of legal ethics for a lawyer to “enter into an arrangement for, charge, or collect a contingent fee for representing a defendant in a criminal case”; see also, ABA Standards for Criminal Justice, Defense Function § 3.3[e] ). The New York State Bar Association adds relevantly “that the Code prohibition of DR 2–106(C) encompasses, in addition to wholly contingent fees, agreements which provide in addition to a fixed basic fee, a further fixed fee contingent upon some specified result” (N.Y.State Bar Opn. No. 412 [1975] ). See also New York Rules of Professional Conduct Rule 1.5(d) (“A lawyer shall not enter into an arrangement for, charge or collect: (1) a contingent fee for representing a defendant in a criminal matter”).

OK so it’s pretty clear – contingency fees in criminal cases are a big no-no. Yet, every once in awhile they still pop up in cases when defendants move to vacate their conviction based upon ineffective assistance of counsel caused by the inherent conflict between the retainer agreement and advocating on behalf of the client’s best interests. The latest version of this scenario played out this week in Garguilio v. Heath a decision from the Southern District of New York denying a writ of habeas corpus based upon such an agreement.

In April 2004, the petitioner killed his brother-in-law following a physical altercation that began outside a restaurant in Brooklyn. Petitioner was represented at trial by veteran attorneys Ronald Aiello and Albert Brackley. Ron Aiello (now deceased) was a former State Supreme Court Judge and Al Brackley is a NY criminal defense legend, whose CLEs on everything from cross-examination to ethics used to be “not-to-be-missed” events.

The victim had previously — and continuously — threatened to kill petitioner. “[N]eutral witnesses [testified] that at one point in the fight [petitioner] dragged the fleeing [victim] from a car and repeatedly stabbed him.” The victim died from twenty two stab-and-incise wounds to the head and upper body. Provided to the jury were instructions on second-degree murder, and the lesser crimes of first-and second-degree manslaughter, and self-defense. Explained by the trial judge was that only the crime of second-degree murder involves a requirement that death result from conduct intended to kill, the other charged crimes required intent to inflict serious injury or reckless conduct. Garguilio also raised a justification defense.

An extreme emotional disturbance defense, though discussed among themselves by defense trial counsel, was not pursued by petitioner’s lawyers or charged to the jury. That defense, when successfully proven in New York, excuses a defendant’s intent to kill if he acts under an extreme emotional disturbance for which there is a reasonable explanation. We used to call it a “Crime of passion.” It does not provide for full acquittal of a homicidal act, but serves only to convert the crime of murder in the second degree into manslaughter in the first degree.

Garguilio was convicted of murder in the second degree and sentenced to 25 to life, which was shortened on appeal to 15 to life. He then moved under CPL section 440 to vacate his conviction based upon ineffective assistance of counsel. His argument was based on the contingency fee agreement between himself and Aiello stating that Aiello would earn a $75,000 bonus in the event of acquittal. (Brackley knew better than to enter into such a deal apparently). Garguilio claimed that this agreement caused Aiello to forgo assertion of an extreme emotional disturbance defense in order to obtain a larger fee for a straight acquittal. A three day hearing was conducted in State Supreme Court and the court denied the relief.

While the State court found that petitioner “met his burden of proving that a contingen[cy] fee existed, and thus that a conflict of interest existed,” Garguilio, 36 Misc. 3d 1240(A), at *3, prejudice caused by the conflict was not sufficiently demonstrated to establish a violation under either the federal or the New York State constitution. Id. at *6; see also id. at *4 n.3.

The State court reasoned that an attorney promised a bonus on the basis of a full acquittal could not, as a matter of logic, have been motivated to avoid the extreme emotional disturbance defense. The court noted that “the extreme emotional disturbance defense can be accepted, and help the defendant, only if the jury has already found all the elements of Murder in the Second Degree and is faced with the obligation to convict.” Since an extreme emotional disturbance defense is only relevant after the jury has rejected complete acquittal of all crimes, “an attorney with a financial interest in an acquittal has no rational basis to forgo the defense.” The court concluded that the “reason for [Aiello’s] opposition [to the extreme emotional disturbance defense] is logically unrelated to the contingen[cy] fee agreement.”

lady justiceGarguilio took his case to Federal Court after his State court appeals were denied. He was lucky enough to end up in Judge Jack Weinstein’s court; Judge Weinstein is known as the most pro-defendant judge in the Eastern District. Unfortunately, his hands were largely tied by the Antiterrorism and Effective Death Penalty Act (AEDPA) which severely curtailed what Federal courts could do when facing writs of habeas corpus resulting from State court convictions. Under AEDPA, a federal court may grant a writ of habeas corpus to a state prisoner on a claim “adjudicated on the merits” in state court only if it concludes that “the adjudication of the claim…(1) resulted in a decision that was contrary to, or involved an unreasonable application of, clearly established Federal law, as determined by the Supreme Court of the United States; or (2) resulted in a decision that was based on an unreasonable determination of the facts in light of the evidence presented in the State court proceeding.” 28 U.S.C. §2254(d). Tremendous deference is given to a State Court’s findings and leaves defendants with almost no promise of Federal relief. This narrow window has notoriously limited the effect of what was once called The Great Writ. Now it should be called The Not So Much Writ. See, The Great Unobtainable Writ, Thomas C. O’Bryant Harvard Civil Rights-Civil Liberties Law Review, Vol. 41 at page 299 (2007).

The only issue was whether Aiello’s performance was “adversely affected” by the actual conflict caused by the fee arrangement. In challenging the conclusion that no adverse effect followed the actual conflict, petitioner relied heavily on the findings of the State court that Aiello “engaged in…’odd behavior’ and [advanced] ‘spurious arguments.'” The Federal court accepted the State court’s finding that Aiello was “hostile to the suggestion that a ‘mental’ defense might sensibly be interposed, and to the submission of any offenses other than Murder in the Second Degree.” It was undisputed, Judge Weinstein said, “that Brackley advocated for using a mock jury proceeding to test various potential theories of the case, including an extreme emotional disturbance defense, but was persuaded not to do so on account of Aiello’s questionable advice that mock jurors could be subpoenaed to testify at trial.” (they could not be as that is attorney-work product and privileged).

The judge however found that the State Court’s determination that there was no adverse effect was not “unreasonable” since Aiello did allow the jury to get the two other lesser-included charges of manslaughter; so he did not take an “all-or-nothing” approach. But the State Court essentially overlooked the argument that someone inflicting 21 stab wounds only meant to seriously injure and not kill someone and that it would be equally hard to convince a jury he recklessly stabbed someone that many times; however, the number of stab wounds could be evidence of extreme emotional disturbance. Therefore Aiello, may have been allowing the other two charges because he knew they had no chance and it was essentially and all-or-nothing angle on the justification defense.

The Federal Court acknowledged that “there is merit to petitioner’s argument” on this issue:

If the extreme emotional disturbance defense had been accepted by the jury, Garguilio would have been “convicted,” even though of a lesser crime, and the bonus would not have been due. But, if the theory actually relied upon by counsel — self-defense — had won the day, Garguilio would have been wholly acquitted and the bonus would have been due. In theory, counsel chose to emphasize the all-or-nothing self-defense rather than extreme emotional disturbance because success in the former would have gained Aiello a bonus, but winning on the later would not. And there was some color to the emotional disturbance argument. Since the deceased . . . had been goading Garguilio with threats of harm, arguably Garguilio stabbed his tormentor repeatedly and uncontrollably because he suddenly cracked after a final threat.

But the court said that “Despite the strength of the petition . . .
Petitioner has not shown that the State court was wrong in rejecting his claim that Aiello’s opposition to the extreme emotional disturbance defense was “due to” the contingency fee.” Since the State court’s conclusion is not the product of an “unreasonable application of,” and not “contrary to clearly established Federal law,” the petition had to be denied. It did not matter if Judge Weinstein thought it was a valid, meritorious argument or a strong petition, the Federal Court can no longer impose its opinion and judgment on the Constitutionality of a State Court post-conviction review unless the State court was “unreasonable” or acted “contrary to established Federal law.”

The messages in this case are clear: (1) Do not enter into contingent fee arrangements on criminal cases; (2) If you are planning a post-conviction attack on a State Court conviction, put all your eggs into the State 440 because the Feds are not likely to intervene if you lose.

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3 replies on “Federal Court Refuses to Reverse Conviction Based on Contingency Fee Agreement”

Nearly none. Technically, they can appeal the Federal denial all the way up to trying to get a writ of certiorari (review) from the US Supreme Court but playing the $400 million Powerball has greater odds.

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