This case, Yates v. United States, is outside our usual employment law zip code, but it’s such a wacky one, it lured us in. It involves a fisherman who failed to preserve, as evidence, undersized fish that he had caught in violation of federal law. A federal agent found the undersized fish during an offshore inspection of a commercial fishing vessel in the Gulf of Mexico. The agent instructed the ship’s captain to keep the undersized fish separate from the rest of the catch until the ship returned to port. After the agent left, however, the captain told his crew to pitch the fish overboard.
Casting a wide net, the government charged the captain with violating a provision of the Sarbanes-Oxley Act (SOX) dealing with the destruction of evidence. (Perhaps you remember that SOX was enacted by Congress following the Enron scandal, which made waves in the financial industry by involving massive accounting fraud and the destruction of documents). Under SOX , a person can be fined or imprisoned for up to 20 years if he “knowingly alters, destroys, mutilates, conceals, covers up, falsifies or makes a false entry in any record, document, or tangible object with the intent to impede, obstruct, or influence” a federal investigation. The captain was found guilty of destroying a “tangible object” – i.e. the fish. He was found guilty and sentenced to 30 days. The U.S. Court of Appeals for the 11th Circuit affirmed the conviction, and the captain appealed to the U.S. Supreme Court.
The Supreme Court found that the charges against the captain were fishy. It held that SOX was meant to address destroyed records and information, not red grouper! In the context of the statute, the destruction of evidence provision immediately follows corporate fraud and financial audit provisions. The term “tangible object” comes at the end of a list of terms that begins with “any record [or] document.” Given the context and placement, a “tangible object” under SOX “is one used to record or preserve information” and does not include the entire universe of objects. As Justice Alito (somewhat whimsically) noted in his concurring opinion,
[T]he term “tangible object” should refer to something similar to records or documents. A fish does not spring to mind – nor does an antelope, a colonial farmhouse, a hydrofoil, or an oil derrick. All are objects that are “tangible.” But who wouldn’t raise an eyebrow if a neighbor, when asked to identify something similar to a “record” or “document,” said “crocodile”?
Now, the Supreme Court wasn’t united in this opinion. Justice Kagan wrote a dissenting opinion, which was joined by Justices Scalia, Kennedy and Thomas. She looked to the ordinary meaning of “tangible object” as “a discrete thing that possesses physical form.” She then went on (even more whimsically) to state:
A fish is, of course, a discrete thing that possesses physical form. See generally Dr. Seuss, One Fish Two Fish Red Fish Blue Fish (1960).
Well, as for this case, I guess it’s the one that got away (from the feds).