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Name: US v. Reyes
Case #: 08-10140
Court: US Court of Appeals
District 9 Cir
Opinion Date: 08/18/2009

A prosecutor commits misconduct by asserting as a fact to the jury something known to be untrue or that he or she has a very strong reason to doubt. Appellant, the CEO of a Silicon Valley company, was charged with securities fraud and falsifying corporate books for backdating stock options given to employees, which is not necessarily illegal, but is where, as here, the benefit is not recorded in the company books. Appellant’s defense at trial was that he acted in good faith and without the intent to deceive by relying on the documentation of the company’s finance department which knew of the practice. An employee in the finance department testified at trial that she did not know the backdating was happening. But higher executives who did not testify at trial previously had told the FBI they did know about the practice. In closing argument, the prosecutor argued that the finance department had no knowledge of the backdating, when in fact the prosecutor knew it did. Defense counsel’s motion for new trial based on prosecutorial misconduct was denied. The appellate court held that as a representative of the government who has a special duty not to impede the truth, it is misconduct for a prosecutor to present to the jury statements or inferences he strongly doubts or knows are false. That is what happened here, and the court would “not lightly tolerate” such conduct. Further because the false statements bore on the contested issue at trial, reversal was required. But the court refused to dismiss the case because there were aggressive tactics by both parties.