finding fraudulent statements relating to sale of tires by service station to coal company which provided coal to Tennessee Valley Authority amounted to matter within the jurisdiction of government agency
How later courts described this case
- finding fraudulent statements relating to sale of tires by service station to coal company which provided coal to Tennessee Valley Authority amounted to matter within the jurisdiction of government agency
- finding that false invoices submitted to private company violated § 1001 because company contracted with and reported to federal agency
- “It has long been established that the words ‘offense against the United States’ encompass all offenses against the laws of the United States, not just offenses directed at the United States as target or victim.” (citations omitted)
- “Protecting itself against being wrongfully overcharged is clearly an ‘official, authorized functionf ]’ of [a governmental agency], not a ‘matter[] peripheral to the business of that body.’ ”
Written by the judges who cited it.
The opinion
MERRITT, Circuit Judge,
dissenting.
I believe that the Supreme Court will adopt Chief Justice Rehnquist’s dissenting opinion in United States v. Yermian, 468 U.S. 63, 75 , 104 S.Ct. 2936, 2942-43 , 82 L.Ed.2d 53 (1984), when again confronted with the question of the defendant’s intent on the jurisdictional element in a § 1001 case. In Yermian , the Chief Justice, writ *324 ing for himself and Justices Brennan, Stevens and O’Connor, said that knowledge of the jurisdictional element in § 1001 prosecutions is required:
I therefore think that the canon of statutory construction which requires that “ambiguity concerning the ambit of criminal statutes ... be resolved in favor of lenity,” is applicable here. Accordingly, I would affirm the Court of Appeals’ conclusion that actual knowledge of federal involvement is a necessary element for conviction under § 1001....
Instead the court suggests that some lesser state of mind may well be required in § 1001 prosecutions in order to prevent the statute from becoming a “trap for the unwary”....
I think that the Court’s opinion will engender more confusion than it will resolve with respect to the culpability requirement in § 1001 cases not before the Court....
If the proper standard is something other than “actual knowledge” or “reasonable foreseeability,” then respondent is entitled to a new trial and a proper instruction under that standard.
468 U.S. at 77 and 83, 104 S.Ct. at 2944 and 2946-47 [citations omitted].
We are faced with the same situation as the Court in Yermian . The District Court, and now our Court, have held that no element of knowledge, foreseeability or culpability is required concerning TVA’s involvement with Peabody. The District Court declined to give an instruction requiring actual knowledge or reasonable foreseeability or any other element of culpability regarding this element, and we have approved. Under such an interpretation even the person who supplied the gas or tires to the defendant, and who knew that the defendant was defrauding Peabody, would be criminally liable under § 1001, even though the supplier had no knowledge of TVA’s involvement. The government should be required to prove knowledge of this element of the crime, and the jury should be required through proper instructions to focus its attention on the defendant’s knowledge that TVA was the victim of the fraud.
I am reinforced in my view that the Supreme Court will reverse its position by two more recent Supreme Court cases. In Liparota v. United States, 471 U.S. 419 , 105 S.Ct. 2084 , 85 L.Ed.2d 434 (1985), the Court said:
With respect to this element [knowledge of federal agency jurisdiction], although the [Yermian ] Court held that the Government did not have to prove actual knowledge of federal agency jurisdiction, the Court explicitly reserved the question whether some culpability was necessary with respect even to the jurisdictional element. 468 U.S. at 75 n. 14 [ 104 S.Ct. at 2943 n. 14].
471 U.S. at 432 , 105 S.Ct. at 2092 .
In Tanner v. United States, 483 U.S. 107 , 107 S.Ct. 2739 , 97 L.Ed.2d 90 (1987), the Court held that, in a prosecution for conspiracy to defraud the government under 18 U.S.C. § 371 , the government must be the known “target” of the fraud and that defrauding a third party recipient of funds is not equivalent to defrauding the government. The Tanner case, although distinguishable because the language of § 371 concerning the federal element differs from the language of § 1001, indicates that in federal fraud cases, the Supreme Court is no longer willing to excuse the prosecution from proving knowledge of the government’s involvement.
I recognize that it is often hazardous for lower federal courts to predict that the Supreme Court will reverse a 5-4 opinion, but such a prediction does not require much of a leap of faith in this case. Chief Justice Rehnquist’s prediction of significant confusion in the lower courts has come to pass. After Yermian , the Supreme Court has reiterated in Liparota its reservations with respect to the knowledge requirement of the jurisdictional element, and in Tanner it has held that the government must be the known target in § 371 fraud-against-the-government cases. The five justice majority in Yermian is no longer intact since two members of the majority are no longer on the Court, but the four dissenting members of the Court remain. Therefore, I do not think Yermian is still *325 good law and would reverse Gibson’s conviction.