131 Federal Judges Heard Cases With Financial Conflicts of Interest

131 Federal Judges Heard Cases With Financial Conflicts of Interest a hands holds the scales of justice aloft (Christophe Ena/AP)

By Theodore Bunker | Tuesday, 28 September 2021 01:02 PM

At least 131 federal judges presided over court cases that involved companies that either they or their families had a financial stake in, an apparent violation of U.S. law and judicial ethics, The Wall Street Journal reported.

Although judges are not barred from owning stock, a federal law does prohibit them from hearing cases that concern a party they, their spouse, or their child, if a minor, has a "legal or equitable interest, however small," and the Judicial Conference of the U.S. requires judges avoid even appearing to have a conflict of interest in a case they hear. The newspaper found in an investigation, 131 judges improperly failed to recuse themselves from 685 court cases across the country in the past 10 years.

The Journal reported roughly two-in-three federal district judges have disclosed stocks, and about one out of every five who did so also heard at least one case that concerned one of those stocks, and about two-thirds of rulings on contested motions were decided in favor of the company that they or their family has a financial stake in. When informed of these violations, 56 of the judges went on to notify the parties in over 300 lawsuits they should have recused themselves from these cases.

In one instance, Colorado Judge Lewis Babcock presided over a case that involved a subsidiary of Comcast, eventually ruling in its favor, during a time in which he or his family owned between $15,000 and $50,000 in stock in the telecommunications company. The case involved a Colorado couple who asked Babcock to block Comcast from gaining access to their property to install fiber-optic cable, claiming the company's employees had bullied them, scared their young daughter, and injured their dog.

The company denied these allegations and wanted the judge to sent the case back to a state court, which he did, ruling the couple had "continually blocked Comcast's access to the easement."

When asked about the case by the Journal, Babcock said: "I dropped the ball," and the newspaper noted he blamed internal procedures for his failure to recuse himself. "Thank you for helping me stay on my toes the way I'm supposed to."

A spokesperson for Comcast declined to comment.

"The Wall Street Journal's report on instances where conflicts inadvertently were not identified before a case was resolved or transferred is troubling, and the Administrative Office is carefully reviewing the matter," the Administrative Office of the U.S. Courts, the agency that carries out policies set by the Judicial Conference, said in a statement to the Journal.