Billion Photos via Shutterstock

Not that long ago, individuals accused of non-violent, "white-collar" crimes were able to stay out of jail pending adjudication of the charges against them, obtaining bail packages that leveraged their substantial assets to satisfy the court's concerns that they would appear for trial. In 2009, both Bernard Madoff, the investment manager accused of perpetrating the largest Ponzi scheme in history, and Marc Dreier, the Manhattan attorney charged with stealing $380 million from hedge funds and investors, sought release pending trial with proposed bail packages that, arguably, only the wealthiest of defendants could afford. Among other things, both defendants secured bail with personal recognizance bonds of $10 million and home detention secured by on-premises armed security guards—guards supplied by a security firm acceptable to the government, but paid for by the defendant or his family. See United States v. Madoff, 586 F. Supp. 2d 240 (S.D.N.Y. 2009); United States v. Dreier, 596 F. Supp. 2d 831, 834-35 (S.D.N.Y. 2009).

Times have changed. The recent decision of the U.S. Court of Appeals for the Second Circuit in United States v. Boustani, 932 F.3d 79 (2d Cir. 2019), marks a shift in the ability of wealthy defendants to secure bail pending trial. Jean Boustani's bail request was similar to those of Madoff and Dreier, if not stronger. Charged with conspiracy to commit wire fraud, securities fraud, and money laundering arising out of an alleged $2 billion scheme, Boustani filed an application for bail that included, among other things, a $20 million personal recognizance bond and home confinement under the supervision of private armed security guards—to be provided by a security firm approved by the government at Boustani's expense. See United States v. Boustani, 356 F. Supp. 3d 246, 250 (E.D.N.Y. 2019).

Nonetheless, Magistrate Judge Peggy Kuo found that Boustani failed to present conditions that would ensure his appearance and the safety of the community, and ordered detention. Following Judge William F. Kuntz's denial of Boustani's appeal, Boustani appealed to the Second Circuit, which affirmed the District Court's order without prejudice to further bail applications before the District Court. See United States v. Boustani, No. 19-344, 2019 WL 2070656, at *1 (2d Cir. March 7, 2019). After Boustani filed another bail application, which the District Court denied on March 28, 2019, Boustani again appealed to the Second Circuit.

In its decision dated August 1, the Second Circuit affirmed the District Court's denial of Boustani's proposed bail package, holding that the Bail Reform Act "does not permit a two-tiered bail system in which defendants of lesser means are detained pending trial while wealthy defendants are released to self-funded private jails." Boustani, 932 F.3d at 82. In explaining its rationale, the court relied on the principle that the justice system should not favor wealthy defendants: "It is a fundamental principle of fairness that the law protects 'the interests of rich and poor criminals in equal scale, and its hand extends as far to each.' To interpret the Bail Reform Act as requiring district courts to permit wealthy defendants to employ privately funded armed guards where an otherwise similarly situated defendant without means would be detained would violate this core principle." Id. (quoting Smith v. Bennett, 365 U.S. 708, 714 (1961)). In reaching this holding, the Second Circuit acknowledged its decision in United States v. Sabhnani, 493 F.3d 63 (2d Cir. 2007), in which the court held that the government failed to meet its burden of showing that no conditions could be imposed to assure the defendants' presence in court where proposed bail conditions included the defendants' agreement to pay for a private security firm selected by the government to provide 24-hour surveillance and thwart any attempts to flee. Id. at 74. But the Boustani Court did not overturn Sabhnini. Rather, the court attempted to distinguish it, clarifying that the private-security condition may be appropriate where the defendant is deemed to be a flight risk primarily because of his wealth, i.e., a wealthy defendant may be released subject to a private-security condition only where, but for his wealth, he would not have been detained. But, if a similarly situated defendant of lesser means would be detained, a wealthy defendant cannot avoid detention by relying on his or her wealth to pay for private guards. See Boustani, 932 F.3d at 82.

On one hand, the Second Circuit's decision seems commendable in that it purports to promote the idea of equal justice before the law by limiting the ability of wealthy defendants to leverage their wealth to secure release pending trial. Defendants who are not remanded not only enjoy living in a familiar, more comfortable environment, but they are arguably better able to participate in their defense. The Boustani decision seeks to level the playing field, precluding rich defendants from using their wealth to improve their pre-trial living conditions and, arguably, the quality of their defense. In so doing, the decision adheres to the oath all federal judges in the United States take before performing their judicial duties, promising to "do equal right to the poor and to the rich." 28 U.S.C. §453.

But on the other hand, the Boustani decision stands contrary to the statute the court sought to apply: the Bail Reform Act of 1984. In the case of a defendant that presents a flight risk, the Bail Reform Act requires that the court release the defendant "subject to the least restrictive further condition, or combination of conditions, that … will reasonably assure the appearance of the person." 18 U.S.C. § 3142(c)(1)(B). Detention is only permitted if the court "finds that no condition or combination of conditions will reasonably assure the appearance of the person as required." 18 U.S.C. §3142(e). "The burden of proof is on the government to prove the absence of such conditions by a preponderance of the evidence." United States v. Shakur, 817 F.2d 189, 195 (2d Cir. 1987). Under this statutory scheme, "it is only a 'limited group of offenders' who should be denied bail pending trial." Shakur, 817 F.2d at 195 (quoting S. Rep. No. 98-225 (1984)). As the Second Circuit held in Sabhnani, wealthy defendants, in agreeing to procure surveillance and armed guards, are capable of creating conditions that will reasonably assure they will appear. Although it acknowledges the terms of the Bail Reform Act, the Boustani decision does not address why Boustani's proposed bail package failed to present a combination of conditions that would reasonably assure his appearance. Instead, the court sidesteps the argument, finding that the District Court's conclusion that confinement was necessary was not "clearly erroneous" without addressing why the conditions Boustani proposed were insufficient.

As such, the Boustani decision represents a departure from the Bail Reform Act's standard. At first glance, that departure may seem appealing. On the surface, the court's opinion rejects any impression that the criminal justice system makes accommodations for wealthier defendants while denying privileges to the accused who are less well-heeled. To the extent the decision protects the public's perception of the courts fairly adjudicating criminal cases irrespective of the defendant's station in life, the Boustani holding is a good one. But the reasoning in the opinion is flawed. As described above, the ruling is at odds with the stated purpose of bail as defined in the Bail Reform Act—the law the court is obligated to apply. Even more troubling, the opinion presupposes that, in order to treat defendants from different backgrounds with parity, the answer is to incarcerate more people who—in this context of deciding bail conditions—have yet to be convicted of a crime. The Bail Reform Act, along with our country's growing concerns over mass incarceration, instructs that Boustani is not the answer: we shouldn't be leveling the playing field by detaining more defendants pre-trial and making it so the rich and poor alike are equally hampered in preparing their defense. Rather, the Bail Reform Act demands that courts embrace alternative conditions of release that serve to ensure a defendant's appearance in court, no matter the economic status of the defendant. Leveraging any means necessary—short of incarceration—to reasonably assure the appearance of their clients, defense counsel should continue to press for pre-trial release for their defendants, wealthy or not.

Brooke Cucinella is a partner and Jonathan T. Menitove is an associate at Simpson Thacher & Bartlett.