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I'm disappointed by Tuesday's decision in Cobell v. Salazar, the first time I ever lost a federal appeal I've argued. (Of course, as always, the Center for Class Action Fairness is not affiliated with the Manhattan Institute.) [Briefing; Coverage: DC Circuit Review; BLT; ICTMN; AP; Reuters; Cronkite; McClatchy; Oklahoman; wildly inaccurate KFBB.]

It has been 10 years since Arthur Andersen LLP, former "Big Five" accounting firm, was indicted for its actions related to the audit of Enron. The firm gave up its CPA licenses and shed nearly 85,000 employees after being found guilty of numerous crimes by a district court and was never able to recover as a firm despite a ruling by the U.S. Supreme Court in Arthur Andersen LLP v. United States which overturned the conviction.

Jim Copland, director of the Center for Legal Policy at the Manhattan Institute, brings to light new tactics employed by the Department of Justice to enforce criminal laws against corporations. In an op-ed published by Bloomberg.com, Copland explains this new approach and why even in the DOJ's efforts to avoid collateral consequences that flow from large-scale prosecutions of corporations such an approach can be problematic:

...in the place of actual prosecutions, the Justice Department has aggressively pursued what are blandly called "deferred prosecution" or "non-prosecution" agreements -- DPAs and NPAs, for short -- through which prosecutors and companies negotiate terms to avoid a criminal trial. This approach may be avoiding the sort of corporate death sentence visited upon Andersen for what proved to be non-crimes, but nonetheless does something just as worrisome: It insinuates Justice Department career bureaucrats into the day-to-day management of major American businesses...

In each of the past three years, fines and penalties levied under federal deferred-prosecution and non-prosecution agreements have exceeded $3 billion. While such fines are not insignificant, of far greater concern are the sometimes sweeping powers that prosecutors have asserted over business practices. In recent DPAs and NPAs, federal prosecutors have variously pressured companies to change long-standing sales and compensation practices; to restrict or modify contracting and merger decisions; to carry out onerous compliance and reporting programs; to appoint corporate monitors with broad discretion over management decisions; and even to oust executives or directors.

Businesses accept the agreements with such aggressive terms because they can ill afford to fight a criminal investigation.

Copland's piece is only an overview of his deeper analysis of DPAs and NPAs undertaken in a Manhattan Institute Civil Justice Report titled The Shadow Regulatory State: The Rise of Deferred Prosecution Agreements. In this report, Copland zeros in on companies currently operating under these agreements and explores the agreed-to terms. He uncovers that "seven Fortune 100 companies are currently operating under the supervision of federal prosecutors: CVS Caremark (CVS) Corp., Google (GOOG) Inc., Johnson & Johnson, JPMorgan Chase & Co., Merck & Co., MetLife Inc. and Tyson Foods Inc."

Manhattan Institute's Center for Legal Policy also brought Copland together with Senator Rand Paul (R-KY) for a web conference to discuss the broader issue of overcriminalization, the rapid expansion over the last forty years of a host of criminal laws, many of which are vague, many of which overlap and those which decrease or eliminate the intent requirements that traditionally were the foundational principle of criminal law.

It will be important to track the developments of DPAs and NPAs especially as more corporations are subject to these agreements. As Copland explains, "others, such as Wal-Mart Stores Inc., currently facing scrutiny for alleged Mexican bribes prohibited under the Foreign Corrupt Practices Act, are sure to follow."

Bob Dorigo Jones has this year's finalists in the Wacky Warning contest. Of course, wacky warnings aren't just silliness created by the legal system. As I noted in 2010, wacky warnings cost consumers money, and make us less safe.

Related: Bluetooth class counsel claims wacky warning worth nearly a billion dollars.

In addition to punishing one who accesses a computer without authorization (e.g., , a non-employee who "hacks" into a corporate network), the Computer Fraud & Abuse Act ("CFAA") also punishes one who "exceeds authorized access" to a computer by "access[ing] a computer with authorization and [using] such access to obtain or alter information in the computer that the accesser is not entitled so to obtain or alter." 18 U.S.C. 1030(a)(4), 1030(e)(6) (emphasis added). In United States v. Nosal, the Ninth Circuit recently limited the reach of the latter portion of the statute. When David Nosal left an executive search firm, he convinced his former colleagues to help him start a competing business by providing him with proprietary information -- including source lists and contact information -- from his former firm's confidential database. Nosal's colleagues were authorized to access the database, but were not authorized to share it outside the company. Nosal was charged with aiding and abetting violations of the CFAA. In Nosal, a divided en banc Ninth Circuit upheld the District Court's dismissal of the counts. The government argued that the statute's "exceeds authorized access" prong should be interpreted to cover not only users authorized to view certain files, but who access other, unauthorized files, but also users with unrestricted access who make unauthorized use of the information. Writing for the majority, Judge Alex Kozinski held that to interpret the statute in that way would make it a "sweeping Internet-policing mandate." He noted that such an interpretation would criminalize violations of corporate computer use policies (for example, using a work computer to send personal email) or website terms of service (such as lying on dating sites). In dissent, Judge Barry Silverman accused the majority of "knocking down straw men," pointing out that the CFAA's requirement of intent to defraud would prevent the majority's "parade of horribles" from occurring. Judge Kozinski, however, wrote that whether or not Congress could criminalize unauthorized use of computer information, the CFAA must be limited to unauthorized access.

Darren McKinney begs to differ on the recent love shown for Bobby Jindal as a vice presidential nominee. Earlier. More on legacy lawsuits: Heritage via Hayride; Lafayette Daily Advertiser; POL was ahead of the issue, discussing the problem in March 2012 and May 2011. LNL reports a reform bill compromise has been reached in principle.

The Institute for Legal Reform has a diverse panel, moderated by Victor Schwartz, evaluate the claims of the trial-lawyer movie "Hot Coffee." Earlier.

David Oliver has lots of good questions about the nonsensical Bartlett v. Mutual case that we discussed May 3.

I talk about the John Edwards trial at The Daily. Earlier.

Today's Wall Street Journal featured a piece which discussed the failure of tactics employed by organized labor and activist groups in an effort to "kill business speech" through the proxy proposal process. These particular proposals at issue seek to limit, burden or in some cases disrupt legitimate corporate political activity.

The Journal, citing Manhattan Institute's Proxy Monitor project, reported:

Support for political proxy proposals has fallen significantly at other big companies as well. Overall, according to the Manhattan Institute's Proxy Monitor, in 2012 political spending or lobbying proposals have received an average shareholder vote of 18.3%, compared with 22.6% last year. Could shareholders be getting wise to the political charade?

The disclosure gambit is key to the left's strategy of intimidating businesses from spending on politics to compete with unions and liberal billionaires like Peter Lewis of Progressive insurance. The political bludgeoning will continue, but at least this year the effort to vilify corporations that have exercised their First Amendment rights isn't getting the kind of traction the activists had in mind.

Our own Jim Copland, director of the Proxy Monitor project and Manhattan Institute's Center for Legal Policy, predicted an increase in political spending and lobbying related proposals and is closely tracking the trend in his regular findings.

In his recent finding, Jim discovered that:

Looking at the composition of shareholder proposals with more specificity, a plurality of all proposals introduced to date in 2012 involve corporate disclosure of political spending or lobbying activities, followed by those related to executive compensation and those seeking to separate the positions of board chairman and chief executive officer...

The increase in the share of proposals related to political spending or lobbying is notable and in keeping with a trend witnessed since the Supreme Court's controversial 2010 Citizens United decision, which held that corporate political speech was protected by the First Amendment. In 2012, fully 26 percent of Fortune 200 companies to have filed proxy materials have faced a proposal related to political spending or lobbying, an all-time high.

As the Journal recognized, despite the increase in volume, it doesn't seem that these political spending and lobbying proposals are having the desired effect. At least not yet.

Julian Heicklen, an 80-year old retired chemistry professor from New Jersey, spent the fall of 2009 and spring of 2010 standing outside the federal courthouse in Manhattan with a sign reading "Jury Info." Mr. Heicklen handed passersby -- including, he hoped, jurors -- brochures advocating jury nullification. The doctrine of jury nulification holds that jurors who disagree with a law may vote, on that basis, to acquit a defendant who violated it. For example, in the mid-19th century, sympathetic United States juries refused to convict abolitionists under the Fugitive Slave Act . Mr. Heicklen had his own opportunity to argue for jury nullification when he was indicted for jury tampering. Last month, however, Judge Kimba Wood dismissed the case. Mr. Heicklen -- who in his 60s openly smoked marijuana on the Penn State campus to protest its prohibition -- had argued that the First Amendment protected him, but prosecutors countered that his conduct was "criminal and without constitutional protection." Judge Wood, however, did not reach the constitutional issue. Rather, she held that the jury tampering statute applies only where the defendant attempts to influence a juror in relation to "a specific case pending before that juror."