Marvin L. Warner v. Rex A. Zent, Warden

NATHANIEL R. JONES, Circuit Judge,

concurring in part and dissenting in part.

Even in a case as' heavily ladened with community emotion as this one, my sworn judicial duty to accord equal rights to the rich as well as the poor remains. Residing within that obligation is the commandment to be vigilant to ensure that the constitutional rights of this defendant have not wittingly or unwittingly, directly or indirectly, been transgressed.

I am strongly persuaded that a constitutional transgression has occurred here. Therefore, I dissent from that part of the majority opinion.

It is quite clear to me that the Ohio Supreme Court’s post facto pronouncement that wire transfers are covered under Section 1153.01 of the Ohio Revised Code Annotated *134 (Baldwin 1988), 1 transgressed the constitutional right of Warner to be provided with fair warning that his actions were criminal. Moreover, the retroactive application of the statute, as was done here, I am convinced, also deprives the defendant of his constitutional right to be fairly warned.

Fundamental to our concept of constitutional liberty is the unwavering ideal that a person has the immutable right to fair warning of the conduct which will permit the imposition of criminal sanctions. Marks v. United States, 430 U.S. 188, 191 , 97 S.Ct. 990, 992 , 51 L.Ed.2d 260 (1977); Bouie v. City of Columbia, 378 U.S. 347, 350-51 , 84 S.Ct. 1697, 1700-01 , 12 L.Ed.2d 894 (1964) (quoting United States v. Harriss, 347 U.S. 612, 617 , 74 S.Ct. 808, 811 , 98 L.Ed. 989 (1954)). “[T]hat right is protected against judicial action by the Due Process Clause.” Marks, 430 U.S. at 192, 97 S.Ct. at 993 . In this context, the Supreme Court has stated:

[A]n unforeseeable judicial enlargement of a criminal statute, applied retroactively, operates precisely like an ex post facto law, such as Art. I, § 10, of the Constitution forbids. An ex post facto law has been defined by this Court as one “that makes an action done before the passing of the law, and which was innocent when done, criminal; and punishes such action,” or “that aggravates a crime, or makes it greater than it was, when committed.” If a state legislature is barred by the Ex Post Facto Clause from passing such a law, it must follow that a State Supreme Court is barred by the Due Process Clause from achieving precisely the same result by judicial construction. The fundamental principle that “the required criminal law must have existed when the conduct in issue occurred,” must apply to bar retroactive criminal prohibitions emanating from courts as well as from legislatures.

Bouie, 378 U.S. at 353-54 , 84 S.Ct. at 1702-03 (emphasis in original) (citations omitted).

I.

Warner moved for a judgment of acquittal after the jury returned its verdicts finding him guilty on six counts of unauthorized acts, in violation of Section 1153.01. He insisted that the wire transfers of funds from Home State to ESM, which were electronic transfers accomplished by computer impulse via the Federal Reserve Board’s wire transfer system, did not constitute the assignment, transfer or delivery of a note, bond, draft or other written instrument as was charged in the indictment. The state responded, arguing that the wire transfers were the functional equivalent of a check or draft. Alternatively, the state, after being allowed to amend Warner’s indictment post-trial to fit its alternative argument, contended that a wire transfer is an order. The trial court denied Warner’s motion for judgment of acquittal.

Upon review, the Ohio Court of Appeals found Warner’s argument to be meritorious. State v. Warner, No. C-870222, 1989 WL 136396 , at *25 (Ohio Ct.App. Nov. 15, 1989), rev’d, 55 Ohio St.3d 31 , 564 N.E.2d 18 (1990), cert. denied, — U.S. -, 111 S.Ct. 1584 , 113 L.Ed.2d 649 (1991). The court found that the state’s belated attempt to amend the indictment was improper. Therefore, the court confined its “consideration to the question of whether a wire transfer constitutes an ‘assign[ment], transfer or deliver[y] of a note, bond, draft or other written instrument.’” Id. at *23.

Referencing civil cases from other jurisdictions, the court concluded that there is compelling authority for finding either that wire transfers are the functional equivalent of a check or that the “construction of the term ‘draft,’ as it is used in R.C. 1153.01, to encompass funds conveyed by computer impulse would amount to judicial legislation by extending the language of the applicable pro *135 vision beyond the intent of the legislature.” Id. Relying on rules of statutory construction and focusing on the compelling authority favoring Warner’s view, the court held that the relevant statutory phrase required that the violative instrument be in writing. Because the wire transfers were effectuated by computer impulse rather than by written instrument, the state appeals court concluded that there was insufficient evidence to convict Warner of the charges in the indictment.

The Ohio Supreme Court reversed. Warner, 564 N.E.2d 18 . The court noted that wire transfers are commonplace and that there is a body of law which treats wire transfers as a writing and/or as “the equivalent of sending a check or issuing a draft.” Id. at 47 . The court found that the rule of ejusdem generis 2 should not be invoked to defeat the obvious purpose of a legislative enactment. The court concluded:

Through R.C. 1153.01, the General Assembly clearly intended to criminalize the unauthorized transfers of an association’s assets regardless of form. Thus, the transfer of funds through the Fedwire system qualifies as a “draft” or other “written instrument” as those terms are used in R.C. 1153.01. Accordingly, the court of appeals’ conclusion that the unauthorized transfer of Home State’s assets over the Fedwire did not constitute a “writing” within the meaning of R.C. 1153.01 was erroneous.

Id.

II.

“Our system of justice is based on the principle that criminal statutes shall be couched in language sufficiently clear to apprise people of the precise conduct that is prohibited.” United States v. Alpers, 338 U.S. 680, 685 , 70 S.Ct. 352, 355 , 94 L.Ed. 457 (1950) (Black, J., dissenting); see also Harriss, 347 U.S. at 617 , 74 S.Ct. at 812 (“The constitutional requirement of definiteness is violated by a criminal statute that fails to give a person of ordinary intelligence fair notice that his contemplated conduct is forbidden by the statute. The underlying principle is that no man shall be held criminally responsible for conduct which he could not reasonably understand to be proscribed.”) (footnote omitted).

As a result, criminal statutes are strictly construed. See, e.g., Alpers, 338 U.S. at 681 , 70 S.Ct. at 353 , United States v. Jeter, 775 F.2d 670, 676 (6th Cir.1985) (quoting United States v. Essex, 407 F.2d 214, 218 (6th Cir.1969)), ce rt. denied, 475 U.S. 1142 , 106 S.Ct. 1796 , 90 L.Ed.2d 341 (1986); United States v. Waechter, 111 F.2d 974, 978 (6th Cir.1985). “This means that no offense may be created except by the words of [the legislature] used in their usual and ordinary sense. There are no constructive offenses.” Alpers, 338 U.S. at 681 , 70 S.Ct. at 353 . I recognize, however, that “ ‘[t]he canon in favor of strict construction [of criminal statutes] is not an inexorable command to override common sense and evident statutory purpose_ Nor does it demand that a statute be given the “narrowest meaning”; it is satisfied if the words are given their fair meaning in accord with the manifest intent of the lawmakers.’ ” United States v. Moore, 423 U.S. 122, 145 , 96 S.Ct. 335, 347 , 46 L.Ed.2d 333 (1975) (quoting United States v. Brown, 333 U.S. 18, 25-26 , 68 S.Ct. 376, 380 , 92 L.Ed. 442 (1948)).

The present language of Section 1153.01 does not disclose that wire transfers are included in the term “draft” or the phrase “other written instrument.” As a result, it seems to me unforeseeable that the statute would be construed in the manner that it was by the Ohio Supreme Court. 3

*136 My reading of Section 1153.01 leads me to the conclusion that it is a narrow and precise statute that plainly and clearly indicates that the lawmakers intended to criminalize written transfers of funds, be it through drafts or other written instruments. This conclusion results from the usual and ordinary usage of the words “draft” and “other written instrument,” as used in this context.

The term “draft” connotes something written. While the majority implies that a “draft” could mean something other than a written document, the ordinary usage of the term, as used in this context, refers to a written document. A “draft,” as defined by Black’s Law Dictionary 258 (5th ed. abr. 1983), is “[a] written order by the first party, called the drawer, instructing a second party, called the drawee (such as a bank), to pay a third party, called the payee.” (Emphasis added.) See also Ohio Rev.Code Ann. § 1303.03 (Baldwin 1988) (as used in a chapter of its Commercial Transactions statutes, a “draft” is a writing which complies with the requirements of being a negotiable instrument). The majority acknowledges that the fundamental nature of a draft includes it being written by stating that “[t]he most common example of a draft is an ordinary bank cheek, of course, and in the experience of most of us — if not in the experience of sophisticated businessmen — bank drafts are always written instruments.” Warner v. Zent, 997 F.2d 116, 127 (6th Cir.1993) (emphasis added). 4

Given the plain, restrictive statutory language, a person transferring funds by wire or computer impulse (or perhaps orally) would not have been able to foresee that his/her act was criminal prior to the ruling by Ohio’s highest court. This unforeseeability is magnified in this type of case because the statute, on its face, is narrow and precise as opposed to merely being vague. Rather than using general, more expansive and inclusive terms, the statute sets out specific types of written instruments which, if used in an unauthorized manner, would violate it. As the Supreme Court discussed when confronted with a narrow and precise statute that a state supreme court judicially expanded:

When a statute on its face is vague or overbroad, it at least gives a potential defendant some notice, by virtue of this very characteristic, that a question may arise as to its coverage, and that it may be held to cover his contemplated conduct. When a statute on its face is narrow and precise, however, it lulls the potential defendant into a false sense of security, giving him no reason even to suspect that conduct clearly outside the scope of the statute as written will be retroactively brought within it by an act of judicial construction. If the Fourteenth Amendment is violated when a person is required “to speculate as to the meaning of penal statutes,” ... or to “guess at [the statute’s] meaning and differ as to its application,” ... the violation is that much greater when, because the uncertainty as to the statute’s meaning is itself not revealed until the court’s decision, a person is not even afforded an opportunity to engage in such speculation before committing the act in question.

Bouie, 378 U.S. at 352 , 84 S.Ct. at 1702 .

Furthermore, when a statute is clear on its face, a citizen — whether a sophisticated businessman or not — should not have to canvass its legislative history and/or judicial pronouncements to determine whether his/her conduct is condemned. Cf. McSherry v. Block, 880 F.2d 1049, 1061 (9th Cir.1989) (Canby, J., dissenting) (When the words of the statute are clear, “[c]itizens should not be required, on pain of criminal conviction, to explore legislative and judicial history to determine whether that history condemns their conduct even though the statute itself does not.”), cert. denied, — U.S.-, 111 S.Ct. 1404 , 113 L.Ed.2d 459 (1991); accord Dunn v. United States, 442 U.S. 100, 112-13 , 99 S.Ct. 2190, 2197 , 60 L.Ed.2d 743 (1979) (quoting United States v. Gradwell, 243 U.S. 476, *137 485 , 37 S.Ct. 407, 411 , 61 L.Ed. 857 (1917)) (“[T]o ensure that a legislature speaks with special clarity when marking the boundaries of criminal conduct, courts must decline to impose punishment for actions that are not ‘ “plainly and unmistakably” ’ proscribed.”). Because the language of Section 1153.01 is so clear, Warner, in my view, was not given fair warning that his actions would be deemed to violate Section 1153.01. We cannot hold the defendant — under this criminal statute — to a higher or lesser standard than any other citizen. As the first Justice John Marshall Harlan wrote in 1896 in Plessy v. Ferguson, 163 U.S. 537, 559 , 16 S.Ct. 1138, 1146 , 41 L.Ed. 256 (1896) (Harlan, J., dissenting), overruled by Brown v. Board of Educ., 347 U.S. 483 , 74 S.Ct. 686 , 98 L.Ed. 873 (1954), in a different context, the constitution does not distinguish between citizens on the basis of caste or class.

Even if it could be contended that there is some uncertainty about what Section 1153.01 states, with the assistance of general principles of statutory construction, it is .clear to me that Section 1153.01 only referred to written instruments prior to the Ohio Supreme Court’s pronouncement in Warner’s ease.

Through the principle of noscitur a soci- is 5 , Section 1153.01 can be construed to apply to only written instruments. As the Ohio Court of Appeals found, “with respect to the provision of the unauthorized acts portion of R.C. 1153.03 [sic] under which Warner was charged[,] [] the legislature’s use of the catch-all phrase ‘other written instruments’ imposed upon the other instruments within the category, i.e., a ‘note,’ ‘bond’ or ‘draft,’ a requirement that they be in writing.” Warmer, 1989 WL 136396 , at *24. Even the majority concedes that “[t]he authors of Ohio Rev.Code § 1153.01 undoubtedly assumed that any check or draft transferred or delivered in violation of the statute would be a written instrument, for otherwise they would not have used the words ‘other written instrument’ in the catch-all phrase at the end of the laundry list that includes the word ‘draft.’ ” Warner, 997 F.2d at 127 (emphasis added). Assumptions are inappropriate elements of criminal statutory construction.

Furthermore, according to another general rule of statutory construction, expressio uni- us est exclusio alterius, the specific mention of one thing in a statute implies an intent on the part of the legislature to exclude another. See, e.g., United States v. Silverman, 976 F.2d 1502, 1522 (6th Cir.1992), cert. denied, — U.S. -, 113 S.Ct. 1595 , 123 L.Ed.2d 159 (1993); McCammon v. Indiana Dep’t of Fin. Insts., 973 F.2d 1348 , 1350 (7th Cir.1992), cert. denied, — U.S. -, 113 S.Ct. 1282 , 122 L.Ed.2d 675 (1993). Pursuant to that rule, the specific mention of the terms “draft” and “other written instrument” implies an intent on the part of the lawmakers to exclude other modes of transfers like wire or computer transfers. As the. Ohio Court of Appeals stated: “The failure of the legislature specifically to proscribe unauthorized transfers of funds by computer impulse might imply an intent on their part to exclude such transfers; however, it might also suggest that the present ubiquity of transfers by computer impulse was not within the contemplation of the legislature when the statute was enacted.” Warner, 1989 WL 136396 , at *24.

Notwithstanding the plain import of Section 1153.01, the majority seems to imply that because wire transfers have become commonplace, a person in the position of Warner reasonably could be expected to know that wire transfers would be treated as the equivalent as checks and drafts, and as a result, the wire transfers Warner made would also violate Section 1153.01. While it is true that wire transfers have become commonplace, I am uncertain where that fact leads me. One could argue that such common usage should have prompted the Ohio Legislature to include same by amending the statute. Certainly the majority cannot be arguing that the mere frequent use of wire transfers, in and of itself, make it foreseeable that those transfers would be deemed illegal. *138 It seems illogical to me to conclude that merely because wire transfers are commonplace, a broader interpretation of “draft” could be foreseeable or that a more narrow reading of the term would defeat the purpose of the legislature rather than promote it.

In addition, while wire transfers are widespread, the law governing those type of transfers was and is anything but clear. Certainly, in the civil context, there is some authority for the proposition that a transfer of funds by computer impulse may be held to be the functional equivalent of a check. See Warner, 564 N.E.2d at 45-47 (authorities noted). As the Ohio Court of Appeals noted, however, “ftjhere exists ... equally compelling authority for Warner’s position that construction of the term ‘draft,’ as it is used in R.C. 1153,01, to encompass funds conveyed by computer impulse would amount to judicial legislation by extending the language of the applicable provision beyond the intent of the legislature.” Warner, 1989 WL 136396 , at *23 (authorities noted). Many courts have decided that wire/electronic transfers were not in the contemplation of the drafters of Article 4 of the Uniform Commercial Code (“U.C.C.”) and have determined that the U.C.C. does not and should not deal with those type of transfers. See id.; Evra Corp. v. Swiss Bank Corp., 673 F.2d 951, 955 (7th Cir.), cert. denied, 459 U.S. 1017 , 103 S.Ct. 377 , 74 L.Ed.2d 511 (1982); Shawmut Worcester County Bank v. First Am. Bank & Trust, 731 F.Supp. 57, 62 (D.Mass.1990); Mellon Bank v. Securities Settlement Corp., 710 F.Supp. 991, 993 (D.N.J.1989). Arguably, the same could have been true with the Ohio legislature’s thinking in formulating Section 1153.01.

Furthermore, by quoting from the Official Code Comment to U.C.C. § 4A-102 (Anderson Supp.1992), 6 the Ohio Supreme Court recognized the need for further legislation to deal with the current banking practices in the civil context. It stated: “We recommend that the General Assembly consider legislation such as UCC 4A-102 in light of today’s modern banking environment and in order to avoid sometimes strained interpretations of Ohio UCC Article IV.” Warner, 564 N.E.2d at 47 n. 21. The same recognition that modern banking practices, including wire transfers, require further explicit legislation would seem to hold true in the criminal context, if not more so, given the loss of personal liberty aspect of criminal justice. In any event, this Court’s majority ought not — and I shall not — countenance a construction of a statute that amounts to en-grafting an amendment upon it. Only by such an amendment can this conviction under Section 1153.01 be held to not violate the defendant’s constitutional right.

Finally, nothing has prevented the Ohio legislature from proscribing, by amendment, that activity directly and explicitly. In fact, the common nature of this type of transfer is all the more reason to expect the legislature to act explicitly. Although due process does not require impossible standards of clarity, further precision, given the commonplace nature of wire transfers, is neither impossible nor impractical. Cf. Kolender v. Lawson, 461 U.S. 352, 361 , 103 S.Ct. 1855, 1860 , 75 L.Ed.2d 903 (1983) (Court found statute to be unconstitutionally vague on its face within the meaning of the due process clause because it did not clarify certain terms).

III.

Given that Section 1153.01 is clear and precise, that such a statute is juxtaposed against rapidly evolving banking practices, and that citizens should not have to rely on *139 clear criminal statutes at the risk of their own personal peril, I must part company with the majority in its conclusion that Warner had fair warning that his actions violated Section 1153.01. While I dissent from Section II.B. of the majority opinion, I do, however, concur in the rest of it.

. Section 1153.01 provides:

No president, director, trustee, committee member, secretary, treasurer, attorney, or other officer or agent of a building and loan association shall embezzle, abstract, or willfully misapply any of the moneys, funds, or credits of the association; nor shall he issue or put into circulation a warrant or other order, or assign, transfer, cancel, or deliver a note, bond, draft, mortgage, judgment, decree, or other written instrument belonging to the association, or raise or receive money for and in the name of such association, unless authorized to do so by its board of directors.

. The rule of ejusdem generis is a canon of statutory construction which limits general terms which follow specific ones to matters similar to those specified. See United States v. Alpers, 338 U.S. 680, 682-83 , 70 S.Ct. 352, 354 , 94 L.Ed. 457 (1950) (quoting Gooch v. United States, 297 U.S. 124, 128 , 56 S.Ct. 395, 397 , 80 L.Ed. 522 (1936)); United States v. Jeter, 775 F.2d 670 , 676 n. 4 (6th Cir.1985) (quoting Black's Law Dictionary 464 (5th ed.1979)), cert. denied, 475 U.S. 1142 , 106 S.Ct. 1796 , 90 L.Ed.2d 341 (1986).

. I do not suggest that a court of a state is prevented from construing its own statutory laws. The Ohio Supreme Court certainly has that right. Moreover, we are bound by that state court’s interpretation. See, e.g., Lovely v. Cunningham, 796 F.2d 1 , 5 n. 4 (1st Cir.1986); Gilbert v. Parke, 763 F.2d 821, 826 (6th Cir.1985). However, while the Ohio Supreme Court could, as is its right, construe Section 1153.01 to include wire transfers, it cannot apply that con *136 struction to Warner if that construction was so unforeseeable as to deprive Warner of the fair warning to which the Due Process Clause of the Constitution entitles him. See Bouie, 378 U.S. at 353-54, 362 , 84 S.Ct. at 1702-03, 1707 .

. Obviously, the phrase "other written instrument” refers to a written instrument.

. The principle of noscitur a sociis (one may be known by the company that one keeps), “acknowledges that general and specific words are associated with and take color from each other, restricting general words to a sense analogous less general.” Owen of Georgia, Inc. v. Shelby County, 648 F.2d 1084, 1092 (6th Cir.1981).

. The Official Code Comment to U.C.C. § 4A-102 reads, in pertinent part:

The funds transfer governed by Article 4A is in large part a product of recent and developing technological changes. Before this Article was drafted there was no comprehensive body of law — statutory or judicial — that defined the juridical nature of a funds transfer or the rights and obligations flowing from payment orders. Judicial authority with respect to funds transfers is sparse, undeveloped and not uniform. Judges have had to resolve disputes by referring to general principles of common law or equity, or they have sought guidance in statutes such as Article 4 which are applicable to other payment methods. But attempts to define rights and obligations in funds transfers by general principles or by analogy to rights and obligations in negotiable instrument law or the law of check collection have not been satisfactory.