The "mercy rule" allows a criminal defendant to offer evidence of his or her good character as a defense to criminal charges. (Federal Rule of Evidence 404.) Evidence of good character isn't allowed for the purpose of arguing that the defendant committed the crime, but shouldn't be convicted. Rather, it's admissible to show that the defendant is unlikely to have committed the alleged crime(s). For example, if the defendant is charged with embezzlement, she can offer evidence that she is honest and law-abiding. (The evidence is relevant on the theory that honest and law-abiding people are less likely to steal money than people without this character trait.)
Character evidence offered under the mercy rule is usually in the form of opinions from the defendant's close acquaintances. Like all other evidence, in order to be admissible, character evidence has to be relevant and based on personal knowledge. This means that the trait of the defendant's character to which a witness testifies must have some connection to the charged crime.
Example: Norman Bates is charged with assaulting Roseanne Fell. Bates can call a close friend to testify that, "In my opinion, Bates is a nonviolent person who wouldn't hurt a fly." The mercy rule allows Bates to offer character evidence suggesting that he has a propensity to be peaceful, making it less likely that he assaulted Fell. However, the friend could not testify that Bates is honest, because that character trait isn't related to the crime.
The defense incurs significant risks by offering evidence of the defendant's good character, which is why defendants rarely take advantage of the mercy rule. The primary risks are that:
If the defendant doesn't offer evidence of his good character, the prosecutor typically can't offer evidence of his bad character. Evidence rules generally forbid prosecutors from attacking a defendant's character unless the defendant first "opens the door" by presenting evidence of good character. Character evidence is barred in this situation because it is too harmful. A judge or jury might convict a defendant for being a "bad person," or might assume that the defendant acted in conformity with his "bad character" during the events in question, even if the evidence of guilt is otherwise weak.
Despite the rule barring them from offering evidence of a defendant's bad character when that character hasn't been put in question, prosecutors routinely argue that "bad person" evidence is relevant for another reason. For example, a judge would probably permit a prosecutor in an assault trial to offer evidence that the defendant previously assaulted the same victim. A judge would probably rule that this is non-character evidence showing that the defendant had a problem with the victim, making it more likely that he would have attacked that victim during the events on trial. A limiting instruction warning jurors not to use the evidence to make a judgment about the defendant's character would be appropriate.
Another non-character theory that prosecutors sometimes use to present evidence of a defendant's past misdeeds is modus operandi, or "M.O." Under this theory, the prosecutor can offer evidence that the method a defendant used to commit past misdeeds is unique and nearly identical to the method allegedly used to commit the charged crime. Evidence of the past misdeeds is then admissible, not to paint the defendant as a bad person, but to show that the common M.O. points to the defendant as the perpetrator of the charged crime. Again, for whatever it's worth, a judge might give a limiting instruction to disregard the evidence as it relates to the defendant's character.