Filed: Sep. 24, 2015
Latest Update: Mar. 02, 2020
Summary: Case: 14-10061 Date Filed: 09/24/2015 Page: 1 of 43 [PUBLISH] IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT _ No. 14-10061 _ D.C. Docket No. 0:13-cr-60068-JIC-1 UNITED STATES OF AMERICA, Plaintiff–Appellant–Cross-Appellee, versus DAVID MCLEAN Defendant–Appellee–Cross-Appellant. _ Appeals from the United States District Court for the Southern District of Florida _ (September 24, 2015) Before MARCUS and WILSON, Circuit Judges, and SCHLESINGER, * District Judge. * Honorable Harvey
Summary: Case: 14-10061 Date Filed: 09/24/2015 Page: 1 of 43 [PUBLISH] IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT _ No. 14-10061 _ D.C. Docket No. 0:13-cr-60068-JIC-1 UNITED STATES OF AMERICA, Plaintiff–Appellant–Cross-Appellee, versus DAVID MCLEAN Defendant–Appellee–Cross-Appellant. _ Appeals from the United States District Court for the Southern District of Florida _ (September 24, 2015) Before MARCUS and WILSON, Circuit Judges, and SCHLESINGER, * District Judge. * Honorable Harvey E..
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Case: 14-10061 Date Filed: 09/24/2015 Page: 1 of 43
[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 14-10061
________________________
D.C. Docket No. 0:13-cr-60068-JIC-1
UNITED STATES OF AMERICA,
Plaintiff–Appellant–Cross-Appellee,
versus
DAVID MCLEAN
Defendant–Appellee–Cross-Appellant.
________________________
Appeals from the United States District Court
for the Southern District of Florida
________________________
(September 24, 2015)
Before MARCUS and WILSON, Circuit Judges, and SCHLESINGER, ∗ District
Judge.
∗
Honorable Harvey E. Schlesinger, United States District Judge for the Middle District of
Florida, sitting by designation.
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SCHLESINGER, District Judge:
This appeal presents us with two challenges. First, we must address the
limits of a federal criminal statute to ensure the statute comports with the
Constitution and that it does not invade the domain of the States’ police power.
No federal criminal common law exists. This proposition was “long since
settled” not twenty-five years following the ratification of the United States
Constitution. United States v. Hudson, 11 U.S. (7 Cranch) 32 (1812). Congress—
not the courts—crafts federal crimes by delineating the elements and prescribing
punishment. See United States v. Wiltberger, 18 U.S. (5 Wheat.) 76, 95 (1820)
(noting “[T]he power of punishment is vested in the legislative, not in the judicial
department. It is the legislature, not the Court, which is to define a crime, and
ordain its punishment.”); Liparota v. United States, 471 U.S. 419, 424 (1985)
(explaining federal crimes are “solely creatures of statute”).
Over recent generations the federal criminal code has burgeoned, leading
some writers to characterize the trend as the federalization of crime. See Susan A.
Ehrlich, The Increasing Federalization of Crime, 32 Ariz. St. L.J. 825 (2000);
Edwin Meese, III, Big Brother on the Beat: The Expanding Federalization of
Crime, 1 Tex. Rev. L. & Pol. 1 (1997). Despite Congress’ increasing role in
regulating criminal activity, States traditionally have “undertake[n] criminal
prosecutions” springing from their “power and authority originally belonging to
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them before admission to the Union and preserved to them by the Tenth
Amendment,” Heath v. Alabama, 474 U.S. 82, 89 (1985)—such is the internal
tension of our federalist system. While both sovereigns have the authority to
regulate criminal conduct within their spheres of influence, each sovereign must
guard against encroachment upon the other’s authority.
The Constitution provides that limitation on Congress. Congress must find
permission to create federal criminal laws in the Constitution. Sabri v. United
States, 541 U.S. 600 (2004); United States v. Edgar,
304 F.3d 1320 (11th Cir.
2002). This case involves the claimed use of federal monies and the mishandling
thereof as the constitutional basis for federal criminal regulation.
To protect against the infringement on the inherent powers of the states by
federalizing traditional state offenses, the government is required to prove beyond
a reasonable doubt each element of a criminal offense, United States v. Gaudin,
515 U.S. 506 (1995), and the failure to do so is fatal to the case. In addition to
other purposes, this burden safeguards the accused’s constitutional rights, ensures
the government does not overreach by prosecuting actions that do not comport
with the statutory language, and guarantees that federal crimes remain distinct
from state crimes.
In this case, we must scrutinize the evidence to ensure that the government is
not prosecuting an act of state bribery. To be convicted of the federal crime of
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bribery in programs receiving federal funds, Congress has prescribed that the
government must prove beyond a reasonable doubt that a corrupt defendant
worked for a state entity “which receive[d] (1) more than $10,000 in federal funds
[and] (2) in connection with programs defined by a sufficiently comprehensive
‘structure, operation, and purpose’ to merit characterization of the funds as benefits
under § 666(b).” Edgar, 304 F.3d at 1327.
In addition to our federalism concerns, we are mindful that the Supreme
Court recently cautioned against federal criminal statutes being read too
expansively. See, e.g., Yates v. United States, 135 S. Ct. 1074 (2015) (concluding
the term “tangible object” defined within the Sarbanes-Oxley Act of 2002,
legislation designed to restore confidence in financial markets, did not apply to the
undersized red grouper that a commercial fishing vessel’s captain threw
overboard).
Second, we are called upon to determine if the government presented
sufficient evidence to prove each of the elements of the charged offenses.
Importantly, we are not called upon to pass judgment on the character of David
McLean. We are, however, reminded of the words of John Adams, a Founding
Father and second President, who once wrote, “But if Virtue was to be rewarded
with Wealth it would not be Virtue. If Virtue was to be rewarded with Fame, it
would not be Virtue of the sublimest Kind.” Letter from John Adams to Abigail
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Adams, (Dec. 2 1778), available at http://www.masshist.org/digitaladams
/archive/popup?id=L17781202ja&page=L17781202ja_3.
The phrase “public service for private gain” encapsulated the government’s
case so well that it began opening statements and closing argument with variations
of it. Ad hominem attacks, irrespective of how effective they may be, cannot
obfuscate the requirement that the government must prove its case beyond a
reasonable doubt. While this Court, and even John Adams, might have concurred
with the government’s characterization of McLean, in order to obtain a conviction
the government must present evidence as to each element of an offense—and that
is precisely what it failed to do here.
I. INTRODUCTION
On August 15, 2013, David McLean was charged in a superseding
indictment with three counts of bribery in programs receiving federal funds, in
violation of 18 U.S.C. § 666(a)(1)(B) and (2). Count One charged McLean with
accepting $1,000 in U.S. currency and a release for $8,000 past due rent in
connection with the awarding of a Margate occupational license. Count Two
alleged that “on or about November 2, 2012,” McLean,
being an agent of Margate, to wit, a City Commissioner of Margate,
Florida, did knowingly and corruptly solicit, demand, accept and
agree to accept anything of value from a person, that is, approximately
$3,000 in United States currency, intending to be influenced and
rewarded in connection with a transaction and series of transactions of
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Margate involving $5,000 or more, that is, a $25,000 MCRA
construction grant.
All in violation of Title 18, United States Code, Sections
666(a)(l)(B) and 2.
In Count Three, the Government alleged that “on or about January 30, 2013,”
McLean,
being an agent of Margate, to wit, a City Commissioner of Margate,
Florida, did knowingly and corruptly solicit, demand, accept and
agree to accept anything of value from a person, that is, approximately
$2,000 in United States currency, intending to be influenced and
rewarded in connection with a transaction and series of transactions of
Margate involving $5,000 or more, that is, a $25,000 MCRA
construction grant.
All in violation of Title 18, United States Code, Sections
666(a)(l)(B) and 2.
Following a jury trial, McLean was acquitted on Count One and convicted on
Counts Two and Three.
At the conclusion of the trial, McLean renewed his Motion for Judgment of
Acquittal and filed a Motion for New Trial. Twenty-one days later, beyond the
fourteen-day deadline, the government responded. McLean moved to strike the
government’s untimely response and sought an Order granting McLean’s motion
by default.
The District Court, on December 5, 2013, denied the Motions to Strike and
for a New Trial, but granted McLean’s Renewed Motion for Judgment of
Acquittal. The District Court concluded that while the government introduced
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adequate evidence that the Margate Community Redevelopment Agency
(“MCRA”) received benefits from a federal program, the government failed to
establish that those benefits were received within the timeframe established in the
superseding indictment.
II. FACTS
McLean served as a Commissioner for the City of Margate, Florida (“City”),
between 2004 and 2013. Each City Commissioner simultaneously served on the
board of the MCRA. The MCRA is a component of the City with a purpose to
promote the physical and economic development of the City. Relevant here,
MCRA’s principal activity is to award matching grants to property owners who
improve their properties by construction, landscaping, or other design projects.
In addition to serving as a Commissioner, McLean was the proprietor of
“Dave’s Tiki Bar.” The bar was located in a building in a shopping center owned
by the government’s cooperating witness, Lutchman “Chris” Singh. In addition to
owning the shopping center, Singh owned an automobile alarm and stereo
installation business in the center.
Once McLean rented the building from Singh around July 2011, he stopped
paying Singh the rent he owed for the bar. Singh was afraid to initiate eviction
proceedings against McLean, because he worried McLean would use his influence
or position to make things difficult for Singh’s business. In November 2011, Singh
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took his concerns to the FBI. The FBI instructed Singh to begin recording his
conversations with McLean, and Singh began doing so in early 2012.
In January 2012, in exchange for a reduction in past-due rent, McLean
agreed to “help[] make the process smoother” for Singh to obtain an auto repair
license from the City. The license costs $125, but Singh explained that, in his
view, having the license added between $60,000 and $100,000 of value to his
business. Singh paid McLean $1,000 in cash and agreed to forgive $8,000 in back
rent in exchange for this assistance.
McLean and Singh also discussed the possibility of filing a fraudulent
application for a matching grant from the MCRA. Essentially, they planned to file
an inflated application for construction costs to improve Singh’s shopping center,
find a contractor who could complete the work for much less, and split the
difference between the MCRA grant and the actual construction costs. To this end,
McLean and Singh prepared an inflated application, which they submitted to the
MCRA for approval on October 31, 2012. The MCRA voted on the application
the next day and approved it; McLean abstained from the vote purportedly because
Singh was his landlord.
On November 2, 2012, Singh met with McLean, gave McLean $3,000 in
cash, and reminded McLean that he still owed McLean $2,000. On January 30,
2013, Singh met with McLean and gave him the remaining $2,000. Immediately
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after this meeting, FBI agents approached McLean. McLean accompanied the
agents to the FBI’s office and consented to an interview, during which he stated, “I
know I shouldn’t have taken the money. I know the guy was setting me up. He
kept wanting to have this meeting and I knew I shouldn’t have done it.” McLean
claimed Singh had given him the money for acting as a consultant on the grant
application process and helping him with the paperwork.
III. STANDARDS OF REVIEW
We review the grant of a motion for judgment of acquittal de novo, giving
no deference to the district court’s determination that the evidence was insufficient
to support the jury’s verdict. United States v. Vernon, 723 F.3d 1234, 1252 (11th
Cir. 2013). In conducting this review, we consider the evidence in the light most
favorable to the government, accepting all reasonable inferences and credibility
determinations made by the jury.
Id. The government need not rebut all
reasonable hypotheses other than guilt, and the jury may choose among the
conclusions to be drawn from the evidence at trial.
Id. A judgment of acquittal is
warranted only when no reasonable jury could have found the defendant guilty
beyond a reasonable doubt. United States v. Almanzar,
634 F.3d 1214, 1221 (11th
Cir. 2011).
A district court’s determination that the evidence against a defendant was
insufficient to support the jury’s guilty verdict is a conclusion of law to which we
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accord no deference. United States v. Molina, 443 F.3d 824, 828 (11th Cir. 2006).
“We must conduct an independent review to decide whether the jury verdicts rest
on substantial evidence, taking the view most favorable to the government.”
United States v. Macko,
994 F.2d 1526, 1532 (11th Cir. 1993) (citation and internal
quotation marks omitted). The test is “whether a reasonable jury could have found
the defendant guilty beyond a reasonable doubt.” United States v. Sellers,
871
F.2d 1019, 1021 (11th Cir. 1989). “If the evidence fairly supports a verdict of
guilty, such that a reasonable jury could find the defendant guilty beyond a
reasonable doubt, then the jury’s verdict may not be overturned.”
Id. at 1021-22.
We review a district court’s application of its local rules for an abuse of
discretion. Mann v. Taser Int’l, Inc., 588 F.3d 1291, 1302 (11th Cir. 2009). The
district court’s interpretation of its own rules is entitled to great deference, and the
challenging party bears the burden of showing that the district court made a clear
error of judgment.
Id. A district court abuses its discretion when it applies an
incorrect legal standard, “applies the law in an unreasonable or incorrect manner,
follows improper procedures in making a determination, or makes findings of fact
that are clearly erroneous.” Citizens for Police Accountability Political Comm. v.
Browning,
572 F.3d 1213, 1216-17 (11th Cir. 2009).
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IV. ISSUES PRESENTED
The government argues that the district court erred in granting McLean’s
post-verdict Motion for Judgment of Acquittal because the court failed to consider
relevant evidence and to draw inferences in favor of the jury’s verdict. The
government asserts that, viewing the evidence in the light most favorable to the
government, the United States sufficiently established that the MCRA received
federal benefits in excess of $10,000.
McLean cross-appeals the district court’s Order denying his Motion to Strike
the government’s untimely response to his Renewed Motion for Judgment of
Acquittal and Motion for a New Trial. McLean argues the District Court should
have granted his motions by default judgment because the government violated the
district court’s local rules when it filed its response one week late. McLean asserts
that he would not have been treated the same had he filed his Fed. R. Crim. P. 29
motion late, and he contends that he was prejudiced by having to respond to the
government’s untimely arguments.
V. DISCUSSION
A. Sufficient Connection to Federal Funds
Section 666(a) of Title 18 of the United States Code criminalizes, in
pertinent part, the corrupt solicitation or acceptance of “any thing of value of
$5,000 or more” by an agent of a local government or agency thereof with the
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intent “to be influenced or rewarded in connection with any business, transaction,
or series of transactions” of such agency. 18 U.S.C. § 666(a)(l)(B). The statute
requires that the government or agency in question have “receive[d], in any one
year period, benefits in excess of $10,000 under a Federal program involving a
grant, contract, subsidy, loan, guarantee, insurance, or other form of Federal
assistance.” Id. § 666(b). The phrase “in any one-year period” is defined as “a
continuous period that commences no earlier than twelve months before the
commission of the offense or that ends no later than twelve months after the
commission of the offense.”
Id. § 666(d)(5). 1
1
The statute provides in full:
(a) Whoever, if the circumstance described in subsection (b) of this section
exists–
(1) being an agent of an organization, or of a State, local, or Indian tribal
government, or any agency thereof–
(A) embezzles, steals, obtains by fraud, or otherwise without
authority knowingly converts to the use of any person other than
the rightful owner or intentionally misapplies, property that–
(i) is valued at $5,000 or more, and
(ii) is owned by, or is under the care, custody, or control
of such organization, government, or agency; or
(B) corruptly solicits or demands for the benefit of any person, or
accepts or agrees to accept, anything of value from any person,
intending to be influenced or rewarded in connection with any
business, transaction, or series of transactions of such
organization, government, or agency involving any thing of value
of $5,000 or more; or
(2) corruptly gives, offers, or agrees to give anything of value to any
person, with intent to influence or reward an agent of an organization or
of a State, local or Indian tribal government, or any agency thereof, in
connection with any business, transaction, or series of transactions of
such organization, government, or agency involving anything of value of
$5,000 or more;
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The Supreme Court has addressed the scope of § 666 on at least three
occasions. In Salinas v. United States, 522 U.S. 52, 57 (1997), the Court held that
the government need not show the bribe the defendant received affected the federal
funds. Salinas had argued that one of the elements of a § 666 offense was that the
bribe impacted the federal funds.
Id. at 55-57. This interpretation of the statute
shall be fined under this title, imprisoned not more than 10 years, or both.
(b) The circumstance referred to in subsection (a) of this section is that the
organization, government, or agency receives, in any one year period, benefits
in excess of $10,000 under a Federal program involving a grant, contract,
subsidy, loan, guarantee, insurance, or other form of Federal assistance.
(c) This section does not apply to bona fide salary, wages, fees, or other
compensation paid, or expenses paid or reimbursed, in the usual course of
business.
(d) As used in this section–
(1) the term “agent” means a person authorized to act on behalf of
another person or a government and, in the case of an organization or
government, includes a servant or employee, and a partner, director,
officer, manager, and representative;
(2) the term “government agency” means a subdivision of the executive,
legislative, judicial, or other branch of government, including a
department, independent establishment, commission, administration,
authority, board, and bureau, and a corporation or other legal entity
established, and subject to control, by a government or governments for
the execution of a governmental or intergovernmental program;
(3) the term “local” means of or pertaining to a political subdivision
within a State;
(4) the term “State” includes a State of the United States, the District of
Columbia, and any commonwealth, territory, or possession of the United
States; and
(5) the term “in any one-year period” means a continuous period that
commences no earlier than twelve months before the commission of the
offense or that ends no later than twelve months after the commission of
the offense. Such period may include time both before and after the
commission of the offense.
18 U.S.C. § 666.
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was soundly rejected by the Court based on § 666’s “expansive, unqualified
language, both as to the bribes forbidden and the entities covered, [and] does not
support the interpretation that federal funds must be affected to violate” § 666. Id.
at 56-57. Importantly, Salinas declined to address whether § 666 required “some
other kind of connection between a bribe and the expenditure of federal funds,”
thereby leaving the door open for such a requirement.
Id. at 59.
Later in Fischer v. United States, 529 U.S. 667 (2000), the Supreme Court
clarified that even when the defendant’s agency was not the primary intended
beneficiary of the federal funds, the jurisdictional element of the offense may still
be met. Fischer had been convicted for defrauding the West Virginia Health
Authority, a participant in the federal Medicare program, and the Supreme Court
had to decide whether the Medicare funds constituted benefits under § 666.
Id. at
677-81. The Fischer Court held that Medicare benefits constituted federal benefits
conferred on a hospital, even though the payments represented “the ‘reasonable
cost’ of services rendered” for patients, who were the primary beneficiaries.
Id. at
673.
The Fischer Court emphasized that the Medicare statute “operates with a
purpose and design above and beyond point-of-sale patient care, and it follows that
the benefits of the program extend in a broader manner as well.” Id. at 677-78.
Indeed, hospitals “play a vital role and maintain a high level of responsibility in
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carrying out the program’s purposes.” Id. at 681. Thus, because advantages to
hospitals were within the contemplation of the Medicare statute, the payments
constituted federal benefits within the meaning of the criminal statute.
Id. at 678.
The Court also pointed out that “the Government does not make the payment
unless the hospital complies with its intricate regulatory scheme” and that the
hospitals receive value not just “from isolated transactions but also long-term
advantages from the existence of a sound and effective health care system.”
Id. at
679-80. These attributes served to distinguish a hospital from “a contractor whom
the Government does not regulate or assist for long-term objectives or for
significant purposes beyond performance of an immediate transaction.”
Id. at 680.
The Supreme Court cautioned that § 666 should not be read without
boundaries, for failure to do so “would turn almost every act of fraud or bribery
into a federal offense, upsetting the proper federal balance.” Id. at 681. In
analyzing whether the payments were benefits, the Court explained, “To determine
whether an organization participating in a federal assistance program receives
‘benefits,’ an examination must be undertaken of the program’s structure,
operation, and purpose.”
Id. To satisfy this scrutiny, a court “should examine the
conditions under which the organization receives the federal payments. The
answer could depend, as it does here, on whether the recipient’s own operations are
one of the reasons for maintaining the program.”
Id. Ultimately, the Fischer Court
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determined the Medicare funds were a benefit since “[t]he payments are made not
simply to reimburse for treatment of qualifying patients but to assist the hospital in
making available and maintaining a certain level and quality of medical care, all in
the interest of both the hospital and the greater community.” Id. at 679-80.
The Fischer decision makes clear, that under some circumstances, indirect
receipt of a benefit is sufficient. The question that Fischer leaves open is how
closely the scheme authorizing the disbursement of federal funds and their ultimate
use at the agency must share a common purpose. See id. at 681 (noting that
whether an agency has received a federal benefit “could depend . . . on whether the
recipient’s own operations are one of the reasons for maintaining the program”).
More recently, in Sabri v. United States, 541 U.S. 600, 606 (2004), the Court
held that the government was not required to prove a nexus between the
defendant’s criminal activity and the federal funds. In particular, Sabri explained
that Congress’ authority under the Spending Clause, art. I, § 8, cl. 1, and the
Necessary and Proper Clause, art. I, § 8, cl. 18, enabled it to ensure that “taxpayer
dollars” were “not frittered away in graft or on projects undermined when funds
are siphoned off or corrupt public officers are derelict about demanding value for
dollars.”
Id. at 605. Simply put, Congress did “not have to sit by and accept the
risk of operations thwarted by local and state improbity. Section 666(a)(2)
addresses the problem at the sources of bribes, by rational means, to safeguard the
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integrity of the state, local, and tribal recipients of federal dollars.” Id. (internal
citation omitted).
Following Salinas and Fischer, this Court considered whether § 666 was a
facially unconstitutional exercise of congressional power under the Spending
Clause. Edgar, 304 F.3d 1320. We recognized that the Supreme Court had
“rejected the government’s contention that any funds distributed from federal
coffers would qualify as benefits for purposes of the limitation established by §
666(b).”
Id. at 1324. In our view, Fischer held that “the evaluation of whether
particular federal receipts count as ‘benefits’ turns on the relevant federal
‘program’s structure, operation, and purpose,’ as well as the conditions under
which an entity receives federal payments.”
Id.
In Edgar, this Court emphasized that post-Fischer, “it is clear that the term
‘benefits’ encompasses only federal funds expended under sufficiently
comprehensive programs,” explaining that the inquiry into the factors enumerated
by the Supreme Court “presages a broad enough inquiry to assure that applications
of § 666 remain within constitutional bounds.”
Id. at 1325. The Edgar decision
further held that in order to sustain a conviction under the statute the government
must prove beyond a reasonable doubt that the individual worked for an “entit[y]
which receive[d] (1) more than $10,000 in federal funds (2) in connection with
programs defined by a sufficiently comprehensive ‘structure, operation, and
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purpose’ to merit characterization of the funds as benefits under § 666(b).” Id. at
1327. 2
Two of our sister circuits have determined that the government need not
prove the defendant’s agency received money directly from the federal government
but only that there was a sufficient nexus between the federal funds and their
ultimate use to satisfy the receipt element of § 666. For example, the Second
Circuit considered the issue in United States v. Zyskind, 118 F.3d 113 (2d Cir.
1997). In Zyskind, the defendant was “the administrator of Hi-Li Manor Home for
Adults (“Hi-Li”), a facility licensed by the New York State Department of Social
Services to provide care for adults who were handicapped or mentally impaired.”
Id. at 114. “Hi-Li was not a direct beneficiary of a federal funding program.
However, at the time of the events in question, nearly all of Hi-Li’s residents
received federal benefits from the Social Security Administration or the
Department of Veterans Affairs.”
Id. Because Hi-Li was the legal custodian of
some of its residents, a portion of the Veterans Affairs checks were made out
directly to the home.
Id.
2
In Edgar, we also recognized that Fischer appeared to validate the Second and Third Circuits’
determination, pre-Fischer, that § 666 could potentially encompass an “exceedingly large class
of traditional state offenses” but that these Circuits recognized “an offense element limiting [§
666]’s application to conduct bearing a sufficient connection to the expenditure of federal funds
or the integrity of federal programs.”
Edgar, 304 F.3d at 1325 (citing United States v. Zwick,
199 F.3d 672, 682-83 (3d Cir. 1999); United States v. Santopietro,
166 F.3d 88, 93 (2d Cir.
1999)). The Supreme Court, in Fischer, confirmed the constitutional limits that these Circuits
suspected existed.
Id.
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The Second Circuit held that proof the agency indirectly received benefits
over $10,000 is sufficient. Id. at 116. The Zyskind Court looked to the statutory
text and concluded, “Nothing in this language suggests that § 666 does not reach
thefts by an agent of an organization that receives federal program moneys and
administers those moneys for the benefit of program beneficiaries;” rather, it
operates to “prevent diversions of federal funds not only by agents of organizations
that are direct beneficiaries of federal benefits funds, but by agents of organizations
to whom such funds are disbursed for further distribution to or for the benefit of
individual beneficiaries.”
Id. (internal quotation marks and alterations omitted).
The Court found that the legislative history confirmed this view because Congress
intended to enact a broad prohibition on bribery.
Id. “The section was enacted as
part of an effort to ‘create new offenses to augment the ability of the United States
to vindicate significant acts of theft, fraud, and bribery involving Federal monies
that are disbursed to private organizations or State and local governments pursuant
to a Federal program.’”
Id. (quoting S. Rep. No. 98-225, at 369 (1983), as
reprinted in 1984 U.S.C.C.A.N. 3182, 3510). “The purpose of the legislation was
to ‘protect the integrity of the vast sums of money distributed through Federal
programs from theft, fraud, and undue influence by bribery.’”
Id. (quoting S. Rep.
No. 98-225, at 370, 1984 U.S.C.C.A.N. at 3511). Thus, the Zyskind Court
concluded, the Veterans Affairs checks qualified as benefits to Hi-Li.
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The First Circuit reached the same conclusion in a case where federal funds
were distributed to the Commonwealth of Puerto Rico by the National Institute on
Drug Abuse. United States v. Dubón-Otero, 292 F.3d 1, 8 (1st Cir. 2002). The
funds “were originally disbursed under a grant to the Puerto Rico Department of
Anti-Addiction Services. Anti-Addiction Services in turn made a grant of a portion
of these funds to the Municipality, which then paid Health Services”—the agency
where the defendants worked.
Id. The Dubón-Otero Court held that “[i]t makes
no difference that Health Services received this money indirectly,” because
“benefits under § 666 are not limited solely to primary target recipients or
beneficiaries.”
Id. at 9. The Court emphasized the “Health Services’ contract with
the Municipality contemplated a relationship between Health Services and the
United States Government, and those operating federal assistance programs like
the Institute are well aware that recipients of program funds use subgrants and
subcontracts to further effectuate the program’s goals.”
Id. In other words, the
federal funds were related to the agency programs to which they ultimately flowed
even if the federal government did not “intend[] to aid or promote the well being”
of Health Services specifically.
Id. at 8. Moreover, even though Health Services
was a subgrantee rather than a direct recipient of funds, “the requirements for each
subgrantee or subcontract relationship are subject to the same requirements for
accountability of federal funds and terms of the award as the actual grantee
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recipient of federal funds.” Id. at 10 (internal quotation marks omitted). In light of
these circumstances, the First Circuit concluded that Health Services had received
federal benefits under § 666.
Id. at 10.
McLean cites the Ninth Circuit’s decision in United States v. Wyncoop, 11
F.3d 119 (9th Cir. 1993), for the proposition that other courts require a more direct
connection between the federal funds and the local agency. In Wyncoop, the
defendant embezzled money from the college that employed him.
Id. at 120. The
college received no federal funds, but the government argued that its participation
in federal student loan programming was sufficient to establish the jurisdictional
element:
Under both the Guaranteed Student Loan (“GSL”) and Supplemental
Loans to Students (“SLS”) programs set forth in 20 U.S.C. §§ 1071-
1099, private banks loan money to qualified students for educational
purposes, and the federal government guarantees the loans. Thus, if a
student borrower defaults on a loan obligation, the government will
repay the bank. In order for its students to be eligible to receive these
federally guaranteed loans, a school must agree to abide by a number
of conditions, including a requirement that the school monitor the
continued enrollment and eligibility of the loan recipients. For this
reason banks often issue the loan checks jointly to the student and to
the school.
Id. at 120-21. The Ninth Circuit held that the statute was not intended to sweep in
indirect beneficiaries of federal funding. Looking to the legislative history, the
Court noted the statute was intended to fill two specific gaps in the existing bribery
legislation:
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First, under 18 U.S.C. § 641, which proscribed the theft of property
“belonging to the United States,” theft of money distributed under
federal programs could not be prosecuted if title to the funds had
either passed to another entity or had become so commingled with
other assets that the “federal character” of the funds could not be
shown. Second, the existing federal bribery statute, 18 U.S.C. § 201,
was inadequate to ensure the integrity of federal programs because
individuals administering the funds but employed by other entities had
been found not to be “[f]ederal officials” as required under that
statute.
Id. at 122 (alteration in original). In short, the Ninth Circuit agreed with the
defendant that “the statute was not intended to cover thefts from institutions like
Trend College that do not themselves receive and administer federal funds.” Id.;
accord United States v. Bynum,
327 F.3d 986, 991 (9th Cir. 2003).
Wyncoop is easily distinguishable from this case—the college at issue there
was a private institution and the decision was issued before Fischer, though the
Ninth Circuit still cites it favorably. See, e.g., Bynum, 327 F.3d at 991.
A better case for McLean, in some respects, is the Fifth Circuit’s opinion in
United States v. Jackson, 313 F.3d 231 (5th Cir. 2002), which McLean cites as
evidence that the government must support its case with documentary evidence
tracking the path of federal funds. In Jackson, the defendant “was director of the
Department of Community Affairs (DCA) for the City of Monroe, Louisiana,
which operates city golf courses, parks, the museum, civic center, and other
recreational venues for the City of Monroe.”
Id. at 233. The government
introduced evidence that the City had received two federal grants, one in each of
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the relevant one-year time periods, through testimony by the Director of
Administration for the City. Id. at 234. In the first year, the City received a
$12,900 grant from the National Endowment for the Humanities (“NEH”) to be
used for the Louisiana Folk Life Festival, and in the second it received the same
grant in the amount of $10,090.
Id. “No grant documents in evidence
substantiate[d] receipts from the NEH of those amounts,” and another witness
indicated the festival was entirely funded by state and local sources.
Id. In light of
this contradiction, the government changed its position and argued that other state
and local agencies had received federal funding which was then passed through to
the City.
Id. at 235.
The Court assumed for purposes of its analysis that the record would support
an inference that two of the state and local grants the festival received drew on
federal funding from the NEH. Id. It based this assumption on specific record
evidence establishing that (1) the NEH made grants to the Northeast Louisiana Art
Council and the Louisiana Endowment for the Humanities, and (2) that each of
those organizations gave grants to the City related to the Folk Life Festival.
Id. at
234-35 & nn.9-10. It found, “The questions then become how much of the grants
from local or state agencies were of federal origin, and when such funds were
received.”
Id. at 235. The Court first found that the testimony presented at trial
was insufficient to prove receipt in the relevant one-year period beyond a
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reasonable doubt, because the witness testified as to the City’s fiscal year rather
than to a calendar year that aligned with the charges. Looking to the documentary
evidence, the Court accepted that one check was designated as federal funds. Id. at
236-37. However, as to the other check, the Court concluded that even though the
evidence suggested “[s]ome underlying federal (NEH) support for [one of the
disputed grants] is apparent from the evidence,” it also “suggest[ed] multiple
sources of support.”
Id. at 237. Because the government had not proved beyond a
reasonable doubt that at least $10,000 distributed to the defendant’s agency
originated from the NEH, the Court found that the jury could not infer the
jurisdictional element of § 666.
Id. at 238.
Although Jackson does not establish—as McLean suggests—that the
government must demonstrate that the agency for which the defendant worked
received federal dollars or require the government to prove its case by
documentary evidence, it does reiterate that the government must prove each
element beyond a reasonable doubt and that courts ought to scrutinize the actual
evidence it presents in support of something like the jurisdictional element, which
in many cases is a routine showing.
The import of the above cases is unmistakable—regardless of whether an
agency receives federal funds directly or indirectly, there must be a nexus between
the funds and their ultimate use to satisfy § 666. In other words, to constitutionally
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cabin § 666 courts must evaluate a federal program’s “structure, operation, and
purpose” to determine if the federal receipts qualify as benefits. Failure to conduct
this necessary investigation violates Fischer’s admonition that § 666 is not a
boundless statute that applies to virtually every state bribery or fraud case.
With this standard as our guide, we turn to the dispute before us. The sole
dispute is the “jurisdictional element” that establishes a federal question in § 666
prosecutions; that is, whether “the organization, government, or agency receives, in
any one year period, benefits in excess of $10,000 under a Federal program
involving a grant, contract, subsidy, loan, guarantee, insurance, or other form of
Federal assistance.” 18 U.S.C. § 666(b).
The government insists the evidence adduced at trial, when viewed in the
light most favorable to it, showed that federal benefits in excess of $10,000 under
federal programs passed from the City to the MCRA for use in redeveloping
blighted and economically depressed areas of the City. What is more, during the
relevant time periods for Counts II and III, the MCRA received six bus shelters
built with federal stimulus funds, which qualified as benefits under § 666(b). A
reasonable jury, therefore, could have concluded that the MCRA, of which
McLean was an agent, received benefits in excess of $10,000 under a federal
program involving some form of federal assistance during the one-year periods
covered by Counts II and III of the superseding indictment. That evidence,
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according to the government, was sufficient to establish the jurisdictional basis for
the charges against McLean and support his convictions. The government was not
required to demonstrate, contrary to the district court’s determination, that § 666(b)
is restricted to funds which are directly received by the agency under the federal
program.
McClean, by contrast, maintains the government failed to show that the
MCRA either directly or indirectly received federal benefits that exceeded $10,000
in fiscal years 2012 to 2013. In fact, the evidence demonstrated the exact opposite
when Dennis Holste, the Assistant Director of the MCRA from 2004-2013,
testified on cross-examination that the MCRA “never actually had federal dollars
provided” to them. According to McLean, at its core, the government’s case was
flawed and the District Court properly granted the Motion for Judgment of
Acquittal. Additionally, McLean argues that there was insufficient evidence for a
jury to find beyond a reasonable doubt that the MCRA received the bus shelters.
At trial, the government introduced testimonial and documentary evidence to
provide the jury a financial picture of the City and the MCRA; among the
documents were government Exhibits 2, 4, 6, and 8. Government Exhibit 2 was
the City’s Comprehensive Annual Financial Report (“Financial Report”) for the
fiscal year ending September 30, 2012. The Financial Report described the MCRA
as a component unit of the City but with a purpose to promote the physical and
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economic redevelopment of the City. Although the MCRA is a legally separate
entity, the City was financially accountable for the MCRA and the MCRA is part
of the government’s operations. The City’s Commission served as the MCRA’s
Board of Commissioners.
The Financial Report established that the City maintains thirteen individual
governmental funds; the two principle funds are the City’s general fund and the
MCRA fund. The City received over $8 million in federal grants during fiscal year
2012, including approximately $4 million in community development block grant
(“CDBG”) funds. CDBG funds are used for landscaping of blighted areas,
commercial revitalization, and park rehabilitation, among other things.3 In fiscal
year 2012, the MCRA received revenues from: tax incremental financing (“TIF”),
a type of property tax collected by the City; investment income; charges for
services; rental income; and some miscellaneous revenue. The report specifically
states that the MCRA did not directly receive any intergovernmental funds—i.e.
state or federal funds—in the fiscal year ending September 30, 2012.
Of the federal funds that the City expended in fiscal year 2012, $1,791,675
were from the various grants made through the CDBG, including the
Neighborhood Stabilization Program. During fiscal year 2012, the City also
3
This page of the Financial Report is not numbered. It appears immediately before page 53, and
follows another unnumbered page entitled “Combining and Individual Fund Financial
Statements.”
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received and expended other federal funds that it received from or through
programs within the Departments of Agriculture, Justice, Transportation, Energy,
Homeland Security, and the Executive Office of the President. The City
additionally received $272,000 in hurricane relief funds from the Federal
Emergency Management Agency either at the end of fiscal year 2011 or the
beginning of fiscal year 2012.
According to the City’s Financial Report, the City received and expended
$4,515,499 in federal assistance for the 2012 fiscal year. The money came from
several different agencies within the federal government, although the only funding
that arguably could have filtered through the City down to the MCRA is (1)
$1,241,339, which came from the Department of Housing and Urban Development
in the form of four CDBGs; or (2) $13,865 from the Department of Transportation,
which was allocated to the City by the Florida Department of Transportation for
Highway Planning and Construction.
Government Exhibit 4 was the City’s Revenue Report (“Revenue Report”),
dated April 4, 2013. According to the Revenue Report, the City received over
$11,000 in federal grants to its general fund for fiscal year 2013. The City had also
received hundreds of thousands of dollars in federal grants to its CDBG accounts.
Government Exhibit 6 was a printout of the MCRA website’s home page
dated October 16, 2012. The webpage referred to the installation of new bus
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shelters as a beautification effort that had improved the appearance of the
redevelopment area. The page stated, in relevant part: “Other beautification
efforts, including . . . the installation of new bus shelters, have improved the
appearance of the redevelopment area.”
Government Exhibit 8 was the MCRA’s proposed budget for fiscal year
2013, from October 1, 2012, to September 30, 2013. The budget listed projected
expenditures and actual expenditures from the preceding fiscal year, and provided
estimates for the expected costs in the coming year. The budget listed several
sources of funding for the MCRA. First, listed under the heading “Tax Increment
Financing” were the City, Broward County, and North Broward Hospital. Next,
under the heading of “Other Revenue” were listed: “fund balance transfer,” which
represents any surplus from the following year; rent receipts; and event fees.
Importantly, Exhibit 8 included $100,000.00 for “bus shelters” as a “capital
outlay expenditure,” and budgeted costs for the painting and maintenance of bus
shelters in a section entitled “Other CRA Property.” Such an entry was absent in
the previous year, from October 1, 2011 to September 30, 2012. In addition, the
budget further provided that, as of an August 2012 revision, the MCRA anticipated
incurring $26,000 in bus shelter maintenance expenses.
In addition to the documentary evidence, two witnesses testified concerning
the MCRA’s financing. Gail Gargano, Director of Finance for the City, explained
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that every year the City received money from the federal government. For fiscal
year 2012, Gargano estimated that the City received $4.5 million in federal funds,
whereas for fiscal year 2013 she estimated the City would receive in excess of $2
million in federal funds. Gargano explained that the MCRA is financially
dependent upon the City. The MCRA is primarily funded by TIF, and Gargano
identified the MCRA’s three funding sources: the City; Broward County; and the
hospital district.
Dennis Holtse, the former Assistant Director of the MCRA, testified that he
“oversaw the operations” of the MCRA from 2004 to 2013. Holtse explained that
the MCRA’s mission was to eliminate slums and blight, and the MCRA attempted
to accomplish this goal by awarding partial grants to eligible commercial
properties for physical improvements, landscaping, and architectural design.
While the MCRA staff reviewed property owners’ applications and made
recommendations, the Board of Commissioners voted on whether to award each
grant, which essentially reimbursed half of an applicant’s costs.
As for the MCRA’s financial structure, Holtse testified that the MCRA was
funded by tax revenue, with the largest contributor being the City, the second
largest, Broward County, and the third, North Broward Hospital District. He also
said that the MCRA generated rent revenues from its ownership of two shopping
centers and event space revenues from a property it owns.
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The government specifically asked Holtse whether, looking at the MCRA
budget for 20l2, it was apparent that the agency “receive[d] over $10,000 in funds
that are funneled through from the Federal Government in the years 2011, 2012,
and 2013?” Holtse responded:
Well, the money -- there were projects done in the [M]CRA district, in
conjunction with the [M]CRA, and that was the State Road 7
landscaping project and bus shelters that were built. The State Road 7
landscaping project, [MCRA] contributed $61,000 for the project, and
the rest was the State Road project -- State Road, they got federal
dollars for that, and that was used to do the landscape improvements
and rehabilitate the roadway. Bus shelters, that was part of the
stimulus package and [MCRA] agreed to maintain the shelters once
they were built. They were built in conformance with the [M]CRA
shelters already built.
Holtse then explained that Broward County built six bus shelters for the MCRA to
supplement the MCRA’s existing shelters, representing a value of approximately
$40,000 each, or $240,000 total for all six shelters. After Broward County paid to
have the shelters built, it was MCRA’s responsibility to maintain them. The bus
shelters, according to Holtse, were completed by Broward County in the calendar
year of 2012 and federal dollars were used for their construction. The bus shelters
were built in conformance with existing MCRA shelters.
On cross examination, defense counsel asked Holtse, “I am curious, where is
the federal money?” Holtse responded, “Hum -- well, the federal money -- we
never actually had federal dollars provided to us.” Defense counsel then asked
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Holtse, “So, the United States Government, United States of America never funded
any [MCRA] projects?” Holtse attempted to explain,
Well, the money didn’t come directly to us. With the bus shelters,
that was given to the county and the county built the shelters, and we
agreed to maintain them. As part of the Three R Project, State Road 7,
repavement of that, we contributed $615,000 TIF monies for that. I
believe there were federal monies. I don’t know.
On redirect, Holtse attempted to clarify, “Federal stimulus were used for the
bus shelters. State Road 7, I don’t know their connection with the federal, state
gets money from a variety of sources related to state road project.” According to
Holtse, the bus shelters were completed in 2012. Holtse also explained that the
North Broward Hospital District received federal funds through the Medicare
program and that Broward County received CDBG funding from the federal
government, as well as federal funding for projects related to the airport and the
port. The City also received CDBG funding, according to Holtse.
When viewed in the light most favorable to the government, the record
establishes that the City received federal funds and that the City transferred, in one
form or another, federal funds to the MCRA during fiscal years 2012 and 2013.
The record also establishes, albeit with less specificity, that at some unidentified
date in either 2012 or 2013 Broward County provided six bus shelters to the
MCRA and that the MCRA agreed to maintain them. Despite the deferential
standard of review, the government’s evidence failed to establish a connection to
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any identifiable federal program so that its “structure, operation, and purpose”
could be reviewed to permit a determination that the funds qualified as a federal
benefit under the jurisdictional element of § 666(b). The evidence in the record
that the MCRA received federal benefits was twofold: 1) the City received federal
funds and the City in turn provided funding to the MCRA; and 2) Broward County
used federal stimulus funds to construct six bus shelters, which were placed in the
continued care of the MCRA. 4 Both Fischer and Edgar explain such a minimal
showing is insufficient to sustain a conviction under the statute. Fischer, 529 U.S.
at 681;
Edgar, 304 F.3d at 1325. The government failed to prove beyond a
reasonable doubt that the MCRA “receive[d] (1) more than $10,000 in federal
funds (2) in connection with programs defined by a sufficiently comprehensive
‘structure, operation, and purpose’ to merit characterization of the funds as benefits
under § 666(b).”
Edgar, 304 F.3d at 1327.
In this case, the government presented insufficient evidence of a relationship
between whatever federal program authorized the distribution of funds to Broward
County and their ultimate use for bus shelters that were transferred to the MCRA.
Here, there was no evidence as to the “structure, operation, and purpose” of the
federal program that expended money to Broward County.
4
During oral argument, the government conceded the record was “a little lax in this area” and
that the only discussion in the record about the federal funds is that they were “stimulus funds.”
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It must be emphasized that it was the government’s failure to produce
evidence on this element that leaves us with no opportunity to examine the federal
program’s “structure, operation, and purpose.” Indeed, absent from the
government’s proof was any evidence identifying the relationship between the
program authorizing a disbursement of federal funds and the ultimate use of those
funds at the local level. As was suggested in Edgar, indirect receipt of funds
qualifies as a benefit only if the government can show a relationship between the
“structure, operation, and purpose” of the federal scheme authorizing the
distribution of funds and their ultimate use at the relevant local level. Edgar, 304
F.3d at 1325.
Accordingly, there was insufficient evidence in the record from which a
reasonable jury could find that the MCRA received a benefit of federal character.
The evidence does not support the guilty verdicts for Counts II and III, and we find
that the jury acted unreasonably in reaching such a verdict. The jury did not
choose among conclusions to be drawn from the evidence, because only one
conclusion can be reached—there was insufficient evidence of federal benefits.
We recognize that evidence showing a confluence between the purpose and
objectives of a federal program can support the inference that funding remains a
federal benefit even though it has passed through multiple intermediaries before
arriving at the defendant’s agency. Specifically, the First Circuit’s opinion in
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Dubón-Otero and the Fifth Circuit’s opinion in Jackson, 313 F.3d 231,
demonstrate that—while the onus is on the government to produce evidence of
some connection between the authorization and ultimate use—it need not show
that the federal government specifically authorized the local use. In this case,
however, the government presented no evidence about the nature, structure, and
purpose of the federal program that originally authorized the funds. The only
evidence in the record is Holtse’s general characterization of the funds as a
“stimulus package” or “federal stimulus program.” “Stimulus program” is not a
federal program or grant that we can analyze to determine whether the funds
Broward County used to purchase the bus shelters were benefits under Fisher and
Edgar.5
5
At least two Courts of Appeals have held that “testimony not corroborated by documentary
evidence” can be sufficient to establish that a government or government agency received federal
benefits exceeding $ 10,000 in a particular year, at least when the testimonial evidence is
“unchallenged.” United States v. Brown,
727 F.3d 329, 336-37 (5th Cir. 2013); see also United
States v. Robinson,
663 F.3d 265, 269-70 (7th Cir. 2011) (holding that, where defendant was
convicted of offering a bribe to a Chicago police officer under § 666, record evidence that the
police department “received a law-enforcement grant from the [DOJ] in the amount of $6.2
million” was sufficient, and “if more were needed” it was established by “a DOJ document [in
the record] explaining [w]hat the grant money would be used for”).
Those cases are distinguishable from this case. First, Holtse’s testimony was not
“unchallenged.” To the contrary, McLean’s counsel vigorously argued throughout trial that none
of the witnesses could establish that MCRA was a recipient of federal funds, and indeed elicited
on cross-examination that Holtse was unsure about the amount of federal funds that had been
used to pay for the State Road project and possibly the bus shelters. Additionally, the
government entities in Brown and Robinson received direct federal funding, not indirect benefits.
Based on our reading of Fischer, and as we suggested in Edgar, indirect receipt of funds
qualifies as a benefit only if the government can show a relationship between the federal scheme
authorizing the distribution of funds and their ultimate use at the relevant local level.
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It should be emphasized that there is no evidence as to the actual amount of
funds used by Broward County that were federal funds. Holtse testified federal
stimulus funds were used, but never identified an amount. This is much too large
of an inference to conclude that 1) federal stimulus funds were used; 2) each bus
shelter costs $40,000; 3) there were six shelters built; and 4) that at least $10,000 in
federal funds must have been used.
B. Question of Law or Fact
We note that the government appears to raise the issue of whether the
decision to classify assistance as a federal benefit is a question of law or fact. To
the extent the government now argues that the question of whether an item can be
classified as a “benefit” under § 666 is a question of law and not of fact for the
jury’s determination—we need not address the alleged error because it was invited
by the government. The invited error doctrine “‘is implicated when a party
induces or invites the district court into making an error.’” United States v. Love,
449 F.3d 1154, 1157 (11th Cir. 2006) (quoting United States v. Stone,
139 F.3d
822, 838 (11th Cir.1998)). “‘Where invited error exists, it precludes a court from
invoking the plain error rule and reversing.’”
Id. (quoting United States v. Silvestri,
409 F.3d 1311, 1327 (11th Cir. 2005)).
Here, the government induced the district court into committing the error for
which it now complains. The government’s proposed jury instruction explained
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that six elements had to be established in order for McLean to be convicted of
“Bribery Concerning Program Receiving Federal Funds.” The third element was,
“[t]hat, during such one year periods, with respect to Count One, the City of
Margate, Florida, received benefits in excess of $10,000 under a Federal program
involving some form of Federal assistance.”
During the charge conference, McLean objected to the absence of the
language in the third element concerning the MCRA and its receipt of federal
benefits. After discussion with the parties, the district court explained:
All right. So, the Government is suggesting a modification with
respect to element three which would read that during such one-year
periods, with respect to Count 1, the City of Margate, Florida received
benefits in excess of $10,000 under a federal program involving some
form of federal assistance; and that during the one-year period, with
respect to Counts 2 and 3, the Margate Community Redevelopment
Agency received benefits in excess of $10,000 under a federal
program involving some form of federal assistance.
The Court then provided that language to the jury in the court’s instructions.
Furthermore, at the hearing on McLean’s Motion for Judgment of Acquittal,
the government urged the District Court not to disturb the jury’s factual
determination. Accordingly, there is no need for us to wade into this issue because
the District Court followed the government’s urging in instructing the jury.
Even assuming, arguendo, that we were to address this issue we find no
error. The Supreme Court “has previously noted the vexing nature of the
distinction between questions of fact and questions of law.” Pullman-Standard v.
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Swint, 456 U.S. 273, 288 (1982). A question is typically one of fact when its
resolution “will vary with the facts of each case.” Martin v. Occupational Safety &
Health Review Comm’n,
947 F.2d 1483, 1485 (11th Cir. 1991). By contrast, a
question of law is resolved “through an exercise in statutory interpretation” that
“consider[s] the nature of the defendant[’s] position[] in relation to Congress’s
intent, as evidenced by the legislative history of the federal” statute at issue.
United States v. Madeoy,
912 F.2d 1486, 1494 (D.C. Cir. 1990). Whereas, a mixed
question of law and fact arises when “‘[T]he historical facts are admitted or
established, the rule of law is undisputed, and the issue is whether the facts satisfy
the [relevant] statutory [or constitutional] standard, or to put it another way,
whether the rule of law as applied to the established facts is or is not violated.’”
Ornelas v. United States,
517 U.S. 690, 696-97 (1996) (alterations in original)
(quoting Swint,
456 U.S. 273, 289 n.19).
Most helpfully, this Court has held in a variety of contexts that, when a
jurisdictional issue is inextricably entwined with a substantive element of a crime,
the issue should be determined at trial by a jury. For example, in United States v.
Ayarza-Garcia, 819 F.2d 1043 (11th Cir. 1987), we considered a criminal statute
providing, in relevant part, “[i]t is unlawful for any person on board . . . a vessel
subject to the jurisdiction of the United States on the high seas, . . . to possess with
intent to . . . distribute a controlled substance,”
id. at 1046 (alterations in original),
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superseded by statute as recognized in United States v. Tinoco, 304 F.3d 1088,
1104-06 (11th Cir. 2002). The Court rejected the defendants’ argument that
whether a vessel was “subject to the jurisdiction of the United States on the high
seas” was a question of law.
Ayarza-Garcia, 819 F.2d at 1048. It explained,
“[W]hen a question of federal subject matter jurisdiction is intermeshed with
questions going to the merits, the issue should be determined at trial. This is
clearly the case when the jurisdictional requirement is also a substantive element of
the offense charged.”
Id. (internal citations omitted). Accordingly, the Court held
that
because Appellants’ jurisdictional challenge was a challenge to the
sufficiency of the government’s evidence which would have involved
determination of issues of fact going to the merits of the case . . . The
proper procedure for raising Appellants’ challenge to the sufficiency
of the government’s evidence to support a finding of assimilation to
statelessness was by a motion for judgment of acquittal under Rule 29
and not by a pretrial motion to dismiss. Upon denial of Appellants’
Rule 29 motions, the question was one for determination by the jury.
Id. at 1048-49.
Similarly, in United States v. Castleberry, 116 F.3d 1384, 1389 (11th Cir.
1997), we held that whether a defendant’s robbery had an effect on interstate
commerce was a question for the jury because it is a substantive element of the
offense. In other words, that the element also represents the federal question that
enables the court to exercise jurisdiction does not transform the question into a
question of law. And before that, the Fifth Circuit held that to sustain a conviction
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for bribery under the Travel Act, the jury was required to determine “that the
defendants, in fact, used interstate facilities.” United States v. Perrin, 580 F.2d
730, 737 (5th Cir. 1978), aff’d,
444 U.S. 37 (1979).6
One published case from the Fifth Circuit does state that the $10,000
requirement is not a purely jurisdictional question and is properly submitted to the
jury. Jackson, 313 F.3d at 233 (“The indictment sufficiently invoked the district
court’s jurisdiction, alleging violations of 18 U.S.C. § 666, including the allegation
that the City of Monroe received federal funds in excess of $10,000 for each
calendar year at issue. The district court had jurisdiction over the case because a
violation of federal law was charged, regardless of the sufficiency of the
Government’s proof.” (internal citation omitted)).
The government cites United States v. Briston, 192 F. App’x 84 (3d Cir.
2006), an unpublished Third Circuit case, in support of this proposition. In
Briston, the Third Circuit considered whether the district court had improperly
instructed a jury that particular funds were federal benefits, and reasoned that
whether something constitutes a benefit is a question of law:
The determination of whether funds provided under a specific federal
program constitute “benefits” for the purpose of 18 U.S.C. § 666(b)
neither requires nor allows a case-by-case factual inquiry by a jury. It
is clear from our discussion above, and the Court’s analysis in
Fischer, that this is a statutory inquiry that requires a court to decipher
6
This Court has adopted as binding precedent the decisions of the Fifth Circuit rendered prior to
October 1, 1981. Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981) (en banc).
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congressional intent by analyzing the “program’s structure, operation,
and purpose.” This is plainly a question of law, not an issue of fact
for the jury.
Id. at 88 (quoting
Fischer, 529 U.S. at 681) (internal citation omitted).
Additionally, two published cases from other circuits have treated the
determination that a particular transaction conferred a “benefit” within the meaning
of § 666 as a question of law. Dubón-Otero, 292 F.3d at 6 (“We also review de
novo the question of what type of transactions constitute benefits under § 666.”);
United States v. Peery,
977 F.2d 1230, 1233 n.2 (8th Cir. 1992) (“The district court
. . . rul[ed] that the classification of the Compact Commission’s rebate [as a
benefit] is a matter of law for judicial determination. As our handling of section
666 implies, we agree that determining whether section 666 applies to [the
defendant’s] conduct is a question of law.”).
However, based on our circuit precedent, if we were to address this issue, we
would determine that the decision to classify assistance as a federal benefit was
properly submitted to the jury.
C. McLean’s Motion to Strike
McLean cross-appealed the District Court’s Order denying his Motion to
Strike the government’s untimely response to his Renewed Motion for Judgment of
Acquittal and Motion for a New Trial. It is McLean’s position that the government
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violated the district court’s local rules when it filed its response one week late, and
that the district court should have granted his motions by default.
Southern District of Florida Rule 7.l(c) provides: “Each party opposing a
motion shall serve an opposing memorandum of law no later than fourteen (14)
days after service of the motion. Failure to do so may be deemed sufficient cause
for granting the motion by default.” Notably, the rule does not require the court to
strike an untimely memorandum. The district court, consequently, did not violate
Rule 7.1(c) in considering the government’s opposition to his motion.
Furthermore, this Court will not typically “second-guess the district court’s
interpretation of its own Rule” regarding timeliness in an effort to avoid
“undermin[ing] the goal of [those] standards that local rules seek to establish.”
Clark v. Hous. Auth. of City of Alma, 971 F.2d 723, 727-28 (11th Cir. 1992). Here,
McLean provides no reasons to support his contention that the district court abused
its considerable discretion in denying his motion to strike the government’s
response. Moreover, as the government pointed out at the hearing on the motion,
the district court was not constrained by Local Rule 7.1(c) from hearing live
argument on the same issues presented in the government’s brief. Thus, striking
the brief would not have automatically entitled McLean to judgment in his favor or
resulted in the exclusion of the government’s arguments. In the end, the district
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court was well within its discretion to consider the document in order to make a
fully informed decision on the merits of McLean’s sufficiency challenge.
VI. CONCLUSION
Based on our review of the record, we affirm the district court’s grant of
judgment of acquittal.
AFFIRMED.
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