Alongside my rabbinic, academic and writing careers, I have been a high-stakes litigator for a quarter century. In addition to being consulted on potential plea deals in white-collar criminal cases, I regularly engage in civil damages settlement talks, which really are negotiated plea deals in monetary matters. The search always is for the middle ground.
In one case, we sued for $14 m., but settled for $8 m – that was the middle ground. In another case - horrible facts for our side - we faced liability of $100,000 in actual damages and $1 m. in punitive damages. We settled to pay $50,000 and the clients threw me a huge party. Although entailing a pay out, that result was even better than the middle ground. Law is complicated and deals are their own universe.
So much of settlement talks escapes the naked eye. Back in the 1990s, one of the richest local governments in America drove itself into bankruptcy by engaging in highly speculative investments that ultimately went south. Under American law, public businesses must report their financials quarterly and in annual reports. Subsequently, they must hire an independent outside firm to audit the reports. I represented one of the nation’s leading accounting firms. This firm was retained to audit that polity’s annual books for accuracy, not to advise on investment strategy.
My accounting-firm client had performed splendidly. However, millions were lost by creditors. To recoup significant losses when investments flounder, creditors and investors often claim securities fraud, despite knowing their losses stemmed from their own poor investment decisions. With the defendant local government having limited remaining assets, many sued my client, the accounting firm that had been hired to review publicly reported numbers for accuracy. They never had been retained for investment advice and proffered none. As the matter moved towards trial, we could not be more pleased.
Then the client instructed us to settle. We were crestfallen because there was no way they could lose.
In Bily v. Arthur Young & Co., the California Supreme Court recently had held that accounting firms – often the only deep pockets in sight amid a corporate bankruptcy – could not be held liable to third-party bankruptcy creditors when they did not act tortiously. Yet this accounting client adamantly instructed us to settle within the bounds of their insurance coverage. No one can assure what a runaway jury might decide. The client’s insurance policy essentially defined their middle ground. Otherwise, a misguided jury could put them out of business permanently.
These experiences came to mind amid reports that outgoing attorney-general Avichai Mandelblit and former prime minister Benjamin Netanyahu were negotiating terms of a plea bargain. On one hand, the media focus lay on whether the deal would remove charges of bribery but retain moral turpitude. Yet, for many respected legal analysts, the underlying charges against Netanyahu are absurd. No serious democracy criminalizes the behavior alleged in Cases 1000, 2000, and 4000. For example, American politicians routinely reward supporters with unique access and lucrative government opportunities no different from what Netanyahu may have provided Shaul Elovitch and Bezeq in return for better coverage in Walla!
In Case 1000, Netanyahu is said to have helped an Israeli citizen, Arnon Milchan, get a visa to enter America and unsuccessfully tried persuading then-finance minister Yair Lapid to extend a ten-year tax break for Milchan. Meanwhile, Milchan and an associate sent his Balfour friend expensive cigars and champagne worth some $200,000. Those actions interplay in other democracies - not in court-based criminal charges, but in reelection campaigns where voters decide. Likewise with Case 2000: Netanyahu’s three meetings with Yediot Aharonot’s Arnon “Noni” Mozes, allegedly promising to limit Israel Hayom’s circulation in return for better Yediot coverage, ultimately saw Likud and Netanyahu voting against the proposal.
Many outsiders have published opinions urging Netanyahu to cop a plea, concede moral turpitude, accept guilt for fraud and breach of trust, step aside from Israel’s daily political circus, take on a new life as a world statesman, write books, and play a role similar to Richard Nixon’s after the Watergate Scandal. A particularly presumptuous piece was published by someone who was compelled to settle several environmental and public safety violations that resulted in $450,000 in fines to pay the largest penalty to date in Massachusetts, but his op-ed did not disclose that. Easy for him to advise.
In reality, Netanyahu necessarily calculates differently from others. In some ways he bears historical greatness, in other ways deep flaws. By Israeli social terms, the champagne and cigar obsessions seem more hedonistic than criminal. Materialism was not the way of prime ministers David Ben-Gurion or Menachem Begin, although Shimon Peres did skirt that boundary in his taste for expensive watches and haberdashery. Nevertheless, Netanyahu is deeply fixated - many would say obsessed - with his public image and legacy. Not only has he served longer than any other Israeli prime minister, but he resists accepting that he cannot form another governing right-wing coalition majority, although most every other Likud leader could if he would step aside. Parties led by Gideon Sa’ar and Avigdor Liberman will never trust him again, yet he refuses to relinquish the reins and transition to a national elder statesman.
This is Netanyahu. He cannot accept a legacy that includes acknowledging corruption and moral turpitude. If imposed on him by a mix of prosecutors determined to destroy him and hostile fact-finders redefining certain unseemly but normative political behavior as criminal, he can live with devoting his life to having those ersatz criminal laws nullified and any prison sentence pardoned or at least commuted. In his mind and in those of Likud’s 1,066,892 voters and perhaps an additional million or more who voted for kindred parties, he crossed no boundary.
In one of his most famous aphorisms, starkly memorable in its original six-word Hebrew, Netanyahu said “There will be nothing [found] because there is nothing.” As when American president George H.W. Bush famously said “Read my lips – no new taxes,” that asseveration would endure as his political tagline and define his legacy. When Bush reversed on taxes, he never recovered. If Netanyahu would sign that there was something, that shame would taint his legacy worse than a conviction he could portray as prejudicially driven by adversaries.
Netanyahu and his family will not voluntarily assume that badge of shame. He sees Moshe Katsav, Ehud Olmert and Yona Metzger, and cannot conceive being categorized with them for posterity.
Certain plea deals, despite their intriguing possibilities, are unacceptable ab initio (from the beginning). Netanyahu never was going to accept a verdict of turpitude. There would be no middle-ground because there is no middle ground.
The writer, a law professor and senior rabbinic fellow at the Coalition for Jewish Values, is a congregational rabbi and senior contributing editor at The American Spectator. His book, General Sharon’s War Against Time Magazine, explores the 1982 war in Lebanon and the libel trial that followed.