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Fishy Application of Sarbanes-Oxley's Ban on Evidence Destruction

By William Peacock, Esq. on July 11, 2014 | Last updated on March 21, 2019

One fish, two fish, red fish, short fish?

John L. Yates is a commercial fisherman. In 2007, he was hauling in some red grouper when a fisheries officer boarded his ship to inspect his haul. After measuring the fish and finding that some of them were less than the minimum size of 20 inches, he issued Yates a citation and set aside the short fish for inspection at the docks.

Yates had his crew toss the short fish overboard and replace them with other fish. He was later convicted for violating an evidence destruction provision of the the Sarbanes-Oxley Act banking reform statute, passed in the wake of the Enron scandal. He's appealing that conviction to the U.S. Supreme Court, arguing that the vague statute has no place in the Gulf of Mexico.

Fine Points of Fish Measurement

If you want to learn the fine points of fish measurement, the Eleventh Circuit's opinion is unintentionally hilarious. For example, opening and closing a fish's mouth can change its length by a few millimeters. And putting fish on ice can lead to shrinkage. The parties actually had experts lined up to testify about size and technique of measurement of Yate's red grouper.

The real issue, however, is the application of a banking reform statute to a fisherman.

What Is a 'Tangible Object'?

Section 1519 punishes those who knowingly destroy or conceal "any record, document, or tangible object" in order to impede an investigation. And a fish, when it is evidence in a federal fisheries investigation, would seem to fit under the generic meaning of "tangible object." That's what the Eleventh Circuit held, anyway.

Yates has appealed to the Supreme Court, asking whether the vague statute, which does not define "tangible object," could reasonably apply to an object that has "no record-keeping, documentary, or informational content or purpose." The Court has already granted cert., so this is set for next term's docket.

A number of amicus briefs have been filed in the case in the last week, including an interesting argument from the Cato Institute. The Cato brief argues the context of the statute should aid interpretation, and in this case, "record, document or tangible object" indicates that "tangible object" should be limited to items related to records or documents (hard drives, diskettes, etc.). Otherwise, the overly broad dictionary definition used by the Eleventh Circuit would render "record" and "document" superfluous.

That's certainly a good point: Statutes should be constructed so that no term is superfluous. (This is the Rule Against Surplusage principle of statutory construction.) The Eleventh Circuit didn't address that argument in its one-paragraph approach to statutory interpretation, nor did it address Yates' argument about the Rule of Lenity, a canon which requires that statutes give notice of what conduct is illegal -- would a reasonable person expect a banking statute to be applied to flinging fish in the sea?

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