Opposition Brief — Robert J. Jesenik, Petitioner v. United States
Supreme Court briefSep 21, 2026
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Nos. 25-7515 and 25-7522
________________________________________________________________
________________________________________________________________
IN THE SUPREME COURT OF THE UNITED STATES
_______________
ROBERT J. JESENIK, PETITIONER
v.
UNITED STATES OF AMERICA
_______________
ANDREW N. MACRITCHIE, PETITIONER
v.
UNITED STATES OF AMERICA
_______________
ON PETITIONS FOR WRITS OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
_______________
BRIEF FOR THE UNITED STATES IN OPPOSITION
_______________
D. JOHN SAUER
Solicitor General
Counsel of Record
A. TYSEN DUVA
Assistant Attorney General
ANDREW C. NOLL
Attorney
Department of Justice
Washington, D.C. 20530-0001
SupremeCtBriefs@usdoj.gov
(202) 514-2217
________________________________________________________________
________________________________________________________________
QUESTION PRESENTED
Whether
testimony
the
district
regarding
the
court
permissibly
purported
excluded
negligence
of
investor victims of the charged mail and wire fraud.
(I)
certain
individual
ADDITIONAL RELATED PROCEEDINGS
United States District Court (D. Or.):
United States v. Jesenik, No. 20-cr-228 (Sept. 8, 2023)
United States v. MacRitchie, No. 20-cr-228 (Sept. 8, 2023)
United States v. Jesenik, No. 20-cr-228 (Sept. 10, 2024)
United States v. MacRitchie, No. 20-cr-228 (Sept. 10, 2024)
United States v. Jesenik, No. 20-cr-228 (May 20, 2025)
United States v. MacRitchie, No. 20-cr-228 (May 20, 2025)
United States Court of Appeals (9th Cir.):
United States v. Jesenik, No. 23-2282 (Sept. 5, 2025)
United States v. MacRitchie, No. 23-2308 (Sept. 5, 2025)
United States v. Rice, No. 23-2316 (Sept. 5, 2025)
United States v. MacRitchie, No. 24-5402 (Sept. 5, 2025)
United States v. Jesenik, No. 24-5404 (Sept. 5, 2025)
(II)
IN THE SUPREME COURT OF THE UNITED STATES
_______________
No. 25-7515
ROBERT J. JESENIK, PETITIONER
v.
UNITED STATES OF AMERICA
_______________
No. 25-7522
ANDREW N. MACRITCHIE, PETITIONER
v.
UNITED STATES OF AMERICA
_______________
ON PETITIONS FOR WRITS OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
_______________
BRIEF FOR THE UNITED STATES IN OPPOSITION
_______________
OPINIONS BELOW
The opinion of the court of appeals (Pet. App. 2-44) is
reported at 152 F.4th 924. *
An accompanying memorandum of the
court of appeals (Pet. App. 49-54) is available at 2025 WL 2573385.
JURISDICTION
The judgment of the court of appeals was entered on September
5, 2025.
Petitions for rehearing were denied on December 29, 2025
Except as otherwise noted, all petition
citations are to the petition appendix in No. 25-7515.
*
appendix
2
(Pet. App. 67).
On March 24, 2026, and March 27, 2026, Justice
Kagan extended the time within which to file petitions for a writ
of certiorari to and including May 28, 2026, and the petitions
were filed on that date. The jurisdiction of this Court is invoked
under 28 U.S.C. 1254(1).
STATEMENT
Following a jury trial in the United States District Court
for the District of Oregon, petitioners Robert J. Jesenik and
Andrew N. MacRitchie were each convicted on one count of conspiring
to commit mail and wire fraud, in violation of 18 U.S.C. 1349, and
28 counts of wire fraud, in violation of 18 U.S.C. 1343.
Judgment 1; MacRitchie Judgment 1.
Jesenik
Jesenik was additionally
convicted on one count of making a false statement to a federally
insured financial institution, in violation of 18 U.S.C. 1014.
Jesenik Judgment 1.
Jesenik was sentenced to 168 months of
imprisonment, to be followed by three years of supervised release.
Id. at 2-3. MacRitchie was sentenced to 70 months of imprisonment,
to be followed by three years of supervised release.
Judgment 2-3.
The court of appeals affirmed.
MacRitchie
Pet. App. 2-44, 49-
54.
1.
Jesenik was the Chief Executive Officer of Aequitas, an
investment management company that he founded in the 1990s.
App. 8.
Pet.
MacRitchie joined Aequitas in 2007 as Executive Vice
President and Chief Compliance Officer.
Ibid.
In that role, he
oversaw the company’s accounting, regulatory compliance, and audit
3
functions and was responsible for ensuring the accuracy of and
approving the company’s marketing materials.
Id. at 18; see
MacRitchie Presentence Investigation Report (PSR) ¶ 14.
Between
2014 and 2016, petitioners participated in a scheme to defraud
Aequitas investors.
Jesenik PSR ¶ 18; MacRitchie PSR ¶ 17.
In the mid-2000s, Aequitas began purchasing trade receivables
-- debts payable by a third party, such as a patient’s unpaid
medical bill or a student’s unpaid loan.
Pet. App. 8.
Aequitas
would purchase the debt at a discount and attempt to collect it at
a profit.
debt
was
Trial Tr. 254-257.
uncollectable,
If the debtor defaulted and the
Aequitas
retained
the
right
under
a
recourse agreement to sell the debt back to the company at face
value.
Id. at 254-257, 633.
By 2014, Aequitas’s largest category
of receivables was student loan debt, including debt purchased
from Corinthian College.
Pet. App. 10.
Aequitas solicited funding from investors and clients of
registered
investment
advisors
including
a
promissory-note
Program,
Aequitas-affiliated
through
program
several
called
investment
instrument called the Lux Bond program.
the
funds,
offerings,
Private
Note
and
debt
Pet. App. 9.
a
Between
June 2014 and February 2016, Aequitas raised $346 million in
private investments, including $167 million through the Private
Note Program.
Ibid.
Aequitas typically solicited investments through in-person
sales pitches conducted by Jesenik and other Aequitas executives.
4
Pet. App. 9, 18.
In the pitches, executives used marketing
materials including a one-to-two-page summary of the investment
called a “tear sheet,” which MacRitchie approved, and a longer
“pitch deck.”
Id. at 9; Trial Tr. 346-347; MacRitchie PSR ¶ 22.
The executives’ oral presentation and the written tear sheets both
represented that investor funds would be used to finance the
purchase of receivables.
In
reality,
Pet. App. 14-15.
however,
Aequitas
overwhelmingly
used
new
investor funds to pay its prior investors and to fund its operating
expenses.
Pet. App. 15.
Near the end of 2015, Aequitas’s new
General Counsel revised the Private Note tear sheet, which another
Aequitas executive described as the first time that the company
provided a “full,” “truthful disclosure” to investors.
867.
Trial Tr.
As revised, the tear sheet disclosed that Aequitas “uses
proceeds from Private Note primarily to repay prior investors.”
Pet. App. 15.
As one registered investment advisor explained, he
would not have invested “a penny” of his clients’ money had he
read that revised disclosure, “[b]ecause that’s the definition of
a Ponzi scheme.”
Ibid. (brackets in original).
Ultimately,
however, the revised tear sheet was never used to market the
products.
Trial Tr. 869-870.
After they agreed to invest, but before their funds were
released to Aequitas, investors received additional documentation,
including a Private Placement Memorandum (PPM) that MacRitchie
approved, and they signed a subscription agreement acknowledging
5
they had read the PPM.
MacRitchie PSR ¶ 22.
Pet. App. 9-10; Trial Tr. 668-672;
Although the PPM disclosed that the company
may use investor funds “to repay the principal and interest of
previously issued” notes “[f]rom time to time,” Pet. App. 23, the
PPM also included statements that Aequitas “used and would continue
to use investor funds to invest [in] new receivables” and it did
not provide “the critical qualifying information that in fact most
of the investors’ money would be used to pay for Aequitas’s
operating
expenses
or
to
pay
interest
and
principal
(i.e.,
redemptions) to earlier investors,” D. Ct. Doc. 677, at 17 (Aug.
30, 2023).
When commenting on the statement in the Private Note
Program PPM representing that the company may “from time to time”
“use investor proceeds
* * *
to repay principal and interest of
previously issued notes,” Trial Tr. 1884, MacRitchie wrote, “Why
qualify?
In
We do this all the time,” id. at 4131.
2014,
Corinthian
College
stopped
paying
Aequitas
for
uncollectable debt under its recourse agreements and filed for
bankruptcy,
shortfalls.”
leading
Aequitas
Pet. App. 10.
to
face
“dire
short-term
cash
In response, the company offered
investors promissory notes with short redemption periods and high
interest rates, and persuaded some investors to delay redemption
of their notes.
Ibid.
Those measures “provided only short-term
relief,” and “[t]he shortfalls were exacerbated by Aequitas’s
spending on new offices, private jets, and corporate retreats.”
Ibid.
In 2015, the Securities and Exchange Commission began
6
investigating Aequitas, and in November 2015, Aequitas stopped
paying Private Note Program redemptions entirely.
Ibid.
In
January 2016, the company defaulted on its obligations, and it was
placed in receivership in March 2016.
2.
Ibid.
Petitioners were charged on one count of conspiring to
commit mail and wire fraud, in violation of 18 U.S.C. 1349; 28
counts of wire fraud, in violation of 18 U.S.C. 1343; and one count
of conspiring to commit money laundering, in violation of 18 U.S.C.
1956(h).
Superseding Indictment 1-10.
Jesenik also was charged
with
additional
a
one
count
of
making
false
statement
to
a
federally insured financial institution, in violation of 18 U.S.C.
1014.
Superseding Indictment 10-11.
a.
Before trial, the government filed a motion in limine
seeking to preclude the defendants from arguing that “the victims
in this case are relatively sophisticated investors who could have,
or should have, exercised more diligence or skepticism in their
dealings with Aequitas,” or that “the victims did not actually
rely on the materially false and misleading statements.”
Doc.
325,
at
28
(Jan.
10,
2023).
In
response,
D. Ct.
petitioners
acknowledged that “a particular investor’s negligence is not a
defense to fraud and proof of actual reliance on the part of the
investor is unnecessary.”
D. Ct. Doc. 349, at 23 (Jan. 31, 2023).
The district court granted the motion, reasoning that “a victim’s
negligence is not a defense to fraud.”
(Mar. 6, 2023).
D. Ct. Doc. 404, at 15
7
b.
At trial, petitioners’ and their codefendant’s counsel
repeatedly questioned Aequitas investors and registered investment
advisors about their receipt and review of Aequitas’s tear sheets,
PPMs, subscription agreements, and audited financial statements;
in some instances, witnesses were asked about those documents’
contents.
See, e.g., Trial Tr. 1487-1489, 1496, 1628-1629, 1704,
1713-1715,
1720-1721,
1996-1999,
2013-2014,
3042-3043.
In
defending themselves against the charges, petitioners contended
(among
other
things)
that
the
combined
set
of
materials
collectively made “full disclosure” to investors, and thus that
“there is no fraud.” Pet. App. 23; see ibid. (quoting MacRitchie’s
counsel as arguing that “[t]here is no half-truth when the whole
truth was provided”).
One witness, Aequitas investor Robert Zamarripa, testified
that he received the PPM “[a]t some point” but did not read it “in
detail.”
Trial Tr. 1488; see id. at 1432, 1452-1453, 1487-1488.
He similarly stated that he read the subscription agreement only
“very briefly, if at all” before investing.
relevant
PPM
and
subscription
agreement
Id. at 1495.
were
offered
The
into
evidence, and defense counsel was permitted to ask Zamarripa
whether he reviewed the documents or had them explained to him,
but the district court sustained the government’s objection to
questioning
Zamarripa
about
the
substantive
documents.
Id. at 1498-1501, 1505-1508.
content
of
the
The district court
instructed the jury that it was “sustaining the objections” because
8
“under the criminal law of mail fraud and wire fraud, we don’t
blame the victim,” and, “as I will instruct you more fully at the
end of the trial, in criminal cases, the victim’s negligence, or
not, is irrelevant.”
Id. at 1508-1509.
At a subsequent sidebar, petitioners’ counsel maintained that
the questioning was relevant to probe petitioners’ “intent to
defraud” and the witness’s credibility. Trial Tr. 1522-1526, 1532.
The district court acknowledged that asking a witness “what they
heard and what they relied upon is relevant to materiality,” and
that “it is fair to ask them if they read the PPM and/or the
subscription agreement.”
Id. at 1527.
But once a witness “says
they didn’t read something,” the court explained, “asking them how
they
would
now
understand
it”
is
“both
irrelevant
and
insufficiently probative” under Federal Rule of Evidence 403.
Ibid.
During cross-examination of a subsequent witness, in response
to the government’s concern that counsel’s questioning attacked
the “adequacy of” the witness’s “due diligence,” the district court
explained that it allowed the questioning because, although “it
may have a corollary effect” on the “issue of whether the investor
acted
responsibly
or
negligently,”
the
court
“viewed
[the
questioning] as a challenge to the credibility of the witness.”
Trial Tr. 1765-1767. “[W]hen the credibility of a witness is being
challenged,” the court maintained, “I allow that type of cross-
9
examination, even if it may have the secondary effect of implying
that there was inadequate due diligence.”
c.
Id. at 1767.
During the conference on jury instructions, the district
court addressed the instruction it intended to give regarding
investor negligence.
Trial Tr. 5738-5739.
The court made clear
that the instruction would not “preclude[] the [petitioners] from
arguing, [l]ook at all the things we gave them,” including the
“PPMs” and the “audited financials,” or that the provision of those
documents is “circumstantial evidence” that petitioners “had no
intent
to
omitted).
defraud.”
Id.
at
5738
(internal
quotation
marks
The court also made clear that while the instruction
would “prevent” petitioners “from arguing that negligence by the
investor disproves materiality,” it “doesn’t prevent [petitioners]
from arguing it disproves intent to defraud.”
Id. at 5739.
MacRitchie’s counsel responded, “I think that’s right,” ibid., and
later reaffirmed that “[w]e agree [that] the negligence by an
investor is not a defense to fraud,” id. at 5761.
When defining the materiality element of the fraud charges,
the district court ultimately instructed the jury that:
It is not a defense to a charge of mail or wire fraud or
a charge of conspiracy to commit mail or wire fraud that
an investor or registered investment advisor may have
been gullible, careless, naïve, or negligent or even
that an investor or registered investment advisor
intentionally disregarded information.
Pet. App. 40-41.
10
d.
The
jury
found
petitioners
guilty
on
the
fraud-
conspiracy count and the substantive wire-fraud counts, and found
Jesenik
guilty
on
the
false-statement
count,
but
acquitted
petitioners of conspiring to commit money laundering.
See D. Ct.
Doc. 640 (May 15, 2023); D. Ct. Doc. 644 (May 15, 2023).
The
district court sentenced Jesenik to 168 months of imprisonment, to
be followed by three years of supervised release, and sentenced
MacRitchie to 70 months of imprisonment, to be followed by three
years of supervised release.
Jesenik Judgment 2-3; MacRitchie
Judgment 2-3.
3.
The court of appeals affirmed.
Pet. App. 2-58.
Among
other things, the court rejected petitioners’ contention that the
district
court’s
treatment
of
evidence
of
purported
investor
negligence precluded them from presenting a complete defense.
at 35-44.
Id.
The court stated that in United States v. Lindsey, 850
F.3d 1009 (9th Cir. 2017) -- a case involving mortgage fraud -the court had established “a bright-line rule against evidence of
individual lender behavior to disprove materiality,” on the view
that “evidence of individual lender behavior can easily touch on
lender negligence, intentional disregard, or lack of reliance -none of which is a defense to mortgage fraud.”
(quoting Lindsey, 850 F.3d at 1017).
defendant
instead
“may
seek
to
Pet. App. 38-39
The court explained that a
disprove
materiality
through
generally accepted standards” because, unlike individual behavior,
“‘[t]he way the entire market has historically treated a statement
11
or requirement says a lot about that statement or requirement’s
natural capacity to influence a decision by market participants.’”
Id. at 39 n.11 (quoting Lindsey, 850 F.3d at 1017).
Perceiving “no reason to adopt a different rule in this case,”
the court found petitioners’ arguments regarding the preclusion of
evidence about investor negligence or nonreliance “foreclosed by
Lindsey.”
Pet. App. 38-39.
The court also rejected petitioners’
related challenge to the materiality instruction, which had been
drawn from the language in Lindsey.
Id. at 41.
The court observed
that the instruction “did not indicate that the written disclosures
were irrelevant.”
Ibid.
And the court rejected petitioners’
contention that the district court improperly limited their crossexamination of Mr. Zamarripa.
Id. at 39-40.
The court of appeals observed that the district court had
“admitted PPMs, subscription agreements, and audited financials”;
that
“several
investors
admitted
that
those
documents
were
material to their decisions”; and that the district court “also
admitted
defense
expert
testimony
about
these
documents,
and
allowed extensive questioning of investors who had read them about
their contents.”
observed
that
Pet. App. 40.
defense
counsel
The court of appeals additionally
had
elicited
testimony
about
investors’ “lengthy experience in the financial industry,” about
registered investment advisors’ “due diligence obligations,” and
that some advisors’ “former clients blamed them for their financial
losses” and “two had been sued for negligence.”
Ibid.
12
The court of appeals further observed that petitioners “were
allowed to cross-examine investors about their claims that they
had not read the PPMs and that they were unaware of Aequitas’
financial difficulties,” and were permitted “to ask investors
questions
relevant
secondary
effect
diligence.’”
to
of
credibility,
implying
Pet. App. 40.
that
‘even
if
it
there
was
may
have
the
inadequate
due
And after recounting all of that
admitted evidence, the court of appeals found that the district
court’s evidentiary rulings “did not prevent the defendants from
urging legitimate disclosure-based defense theories.”
Ibid.
ARGUMENT
Petitioners contend (25-7515 Pet. 16-19; 25-7522 Pet. 7-11)
that the district court erroneously precluded their use at trial
of evidence of investor behavior to defend against their fraud
offenses.
Petitioners misconstrue the district court’s rulings,
and
court
the
contentions.
of
appeals
correctly
rejected
petitioners’
The court of appeals’ decision does not conflict
with any decision of this Court or another court of appeals.
And
this case would be a particularly poor vehicle in which to consider
the question presented because any error was harmless.
This Court
has previously denied petitions for writs of certiorari presenting
similar issues. See Johnson v. United States, 592 U.S. 1082 (2020)
(No. 19-1412); Palamarchuk v. United States, 590 U.S. 980 (2020)
(No. 19-7469); Shevtsov v. United States, 590 U.S. 971 (2020) (No.
19-7361); Kuzmenko v. United States, 590 U.S. 971 (2020) (No. 19-
13
7368); New v. United States, 590 U.S. 971 (2020) (No. 19-7729);
Raza v. United States, 585 U.S. 1017 (2018) (No. 17-1314).
It
should follow the same course here.
1.
court’s
The court of appeals correctly affirmed the district
evidentiary
and
instructional
rulings
regarding
the
purported negligence of individual victims of petitioners’ fraud
offenses.
a.
Pet. App. 38-42.
The federal wire fraud statute prohibits using a wire to
execute a “scheme or artifice to defraud, or for obtaining money
or
property
by
means
of
false
representations, or promises.”
or
fraudulent
18 U.S.C. 1343.
pretenses,
The federal mail
fraud statute likewise prohibits using the mail for the purpose of
executing a “scheme or artifice to defraud, or for obtaining money
or
property
by
means
of
false
or
fraudulent
pretenses,
representations, or promises.” 18 U.S.C. 1341. In Neder v. United
States, 527 U.S. 1 (1999), this Court explained that Congress
intended
to
incorporate
into
those
statutes
the
common-law
requirement of materiality. Id. at 20-25. The Court also observed
that the Second Restatement of Torts provides that a matter is
material if:
(a) a reasonable man would attach importance to its existence
or nonexistence in determining his choice of action in the
transaction in question; or
(b) the maker of the representation knows or has reason to
know that its recipient regards or is likely to regard the
matter as important in determining his choice of action,
although a reasonable man would not so regard it.
14
Id. at 22 n.5 (quoting 3 Restatement (Second) of Torts § 538(2),
at 80 (1977)).
And the Court made clear that “[t]he common-law
requirements of ‘justifiable reliance’ and ‘damages’ * * * plainly
have no place in the federal fraud statutes.”
Id. at 24-25.
Consistent with that understanding, the court of appeals
explained in United States v. Lindsey, 850 F.3d 1009 (9th Cir.
2017), which involved charges of fraud in the mortgage industry,
that a “false statement is material if it objectively had a
tendency to influence, or was capable of influencing, a lender to
approve a loan,” even if the false statement did not in fact
“‘induc[e] any actual reliance.’”
see Neder, 527 U.S. at 25.
Id. at 1015 (citation omitted);
The court further stated that “a
victim’s intentional disregard of relevant information is not a
defense to wire fraud and thus evidence of such disregard is not
admissible as a defense to mortgage fraud.”
1016.
Lindsey, 850 F.3d at
The court emphasized, however, that defendants are not
“powerless to challenge the materiality of false statements made
in connection with securing mortgages.”
“Among
other
things,”
Lindsey
Ibid.
continued,
“defendants
can
disprove materiality through evidence of the lending standards
generally applied in the mortgage industry.” 850 F.3d at 1016.
“For example, defendants can offer testimony about the types of
information, such as household income or assets, that lenders
typically consider, as well as evidence of how much weight the
industry generally gives to statements about such information.”
15
Ibid.
“As long as defendants do not stray into evidence of the
behavior
of
individual
lenders
--
for
instance,
evidence
of
specific prior bad loans or particular mistakes by underwriters
-- defendants may attack materiality though industry practice.”
Ibid.
b.
Petitioners err in suggesting that the court of appeals
in this case approved a broad “blanket preclusion of defense use
of investor behavior,” 25-7515 Pet. 21, or “a categorical bar
against all evidence of individual investor behavior to disprove
any element” of mail or wire fraud, 25-7522 Pet. 8 (emphasis
omitted).
Although the decision below stated that evidence of an
individual victim’s “negligence, intentional disregard, or lack of
reliance”
is
irrelevant,
it
found
that
the
district
court’s
evidentiary rulings “did not prevent [petitioners] from urging
legitimate disclosure-based defense theories.”
Pet. App. 39-40.
Petitioners were permitted, among other things, to probe the
fact that the written disclosures were provided to investors, to
question
whether
investors
had
reviewed
the
disclosures,
to
identify the disclosures’ content, and to elicit from several
investors admissions “that those documents were material to their
decisions.”
Pet.
App.
40.
In
practice,
nothing
precluded
petitioners from presenting evidence, or arguing to the jury, that
a
reasonable
investor
would
have
completely
digested
every
document provided, or would have placed weight solely on the PPMs
and financial information that (purportedly) would have revealed
16
the full truth, and attached no weight to the misleading statements
in the marketing materials.
Nor did anything preclude petitioners
from arguing that they lacked intent to defraud because they
subjectively
expected
investors
to
notwithstanding their misstatements.
divine
the
truth,
See, e.g., id. at 42.
Petitioners accordingly are incorrect in asserting that the
court of appeals has precluded a defendant’s use of any evidence
of investor behavior in support of his defense.
21; 25-7522 Pet. 8.
defendant
must
“be
25-7515 Pet. 8,
The panel in Lindsey made clear that a
allowed
to
prove
lender
behavior
to
some
extent,” and can seek to “disprove materiality through evidence of
the
* * *
standards generally applied” in the industry.
F.3d at 1016-1017.
850
The court of appeals foreclosed “evidence of
the behavior of individual [victims]” only when it risks touching
on
victim
reliance.”
“negligence,
intentional
Ibid. (emphasis added).
disregard,
or
lack
of
And the courts below in this
case likewise permitted petitioners to elicit and rely on evidence
of investor behavior where the court viewed such evidence as
relevant to a permissible defense.
As the court of appeals
recognized, petitioners “were permitted to argue that the written
disclosures” (such as the PPMs) “were accurate” and “material to
investors”; to argue that “their provision of written disclosures
to investors was evidence of good faith”; and “to attack the
investors’ credibility” when they claimed not to have read the
disclosures.
Pet. App. 41-42; see also id. at 24.
17
Petitioners claim that the district court prevented them from
probing investors’ credibility and “prohibited cross-examination
of
potential
investors
about
disclosure
claimed not to have received them.”
documents
once
they
25-7515 Pet. 10-11; see id.
at 18, 23-24; see also 25-7522 Pet. 8.
But they cite only the
cross-examination of a single witness, Mr. Zamarripa.
And the
district court excluded that cross-examination on relevancy and
related grounds based on the witness’s claimed lack of knowledge
about the substance of documents he had not read.
See pp. 7-8,
supra.
When investor witnesses had read the documents, by contrast,
the district court “allowed extensive questioning
* * *
about
their contents,” Pet. App. 40, and when witnesses’ credibility was
challenged, the court allowed cross-examination about investors’
individual practices, even if that questioning “may have the
secondary
effect
of
implying
that
there
diligence” on the part of the investor.
c.
was
inadequate
due
Ibid.
Jesenik argues that by allowing for the exclusion of
evidence of individual victims’ purported negligence, the court of
appeals has created an “asymmetry” that allows the government to
“selectively elicit and rely on investor behavior that supports
its case” but “prohibit[s]” the defense “from doing the same.”
25-7515 Pet. 4; see id. at 16, 22-23.
But an individual victim’s
idiosyncratic, negligent, or unreasonable response says nothing
about the response an objective, reasonable person would have.
18
Evidence that one person, or even many people, did not digest
additional documentation beyond the marketing materials cannot
alone establish that a “reasonable” investor would have attached
no weight to the marketing materials (or that a defendant would
expect no weight to be attached).
The standard of reasonableness
must instead be shown through, for example, the standards and
practices of investors who are reasonable.
Petitioners’ reliance (25-7515 Pet. 17; 25-7522 Pet. 11) on
this Court’s decision in Universal Health Services, Inc. v. United
States
ex
rel.
Escobar,
579
U.S.
176
(2016),
accordingly
is
misplaced.
That case, which concerned the False Claims Act’s
prohibition
against
knowingly
presenting
“false
or
fraudulent
claim[s]” to the government for payment, 31 U.S.C. 3729(a)(1)(A),
involved the application of the standard of materiality for commonlaw fraud, which is incorporated into the federal fraud statutes
as well, see Universal Health Servs., 579 U.S. at 187, 193 n.5
(citing Neder, 527 U.S. at 22 n.5).
The Court explained that proof
of materiality can include evidence of the defendant’s knowledge
of
the
federal
government’s
practices in paying claims.
“consistent[]”
Id. at 195.
or
“regular[]”
Specifically, if the
government regularly refuses to pay claims that fail to satisfy a
certain
requirement,
that
can
indicate
the
requirement’s
materiality; conversely, if the government regularly pays such
noncompliant claims despite knowledge of the deficiency, that can
indicate the requirement’s immateriality.
See ibid.
19
The admissibility of such evidence when a false claim is
presented to the government does not suggest that evidence of
individual investors’ putative “negligence” was admissible here.
Because
the
“represents
federal
the
government
entire
market
in
for
a
False
issuing
Claims
federal
Act
case
government
contracts,” the government’s own past conduct is analogous to “the
weight
the
entire
statement.”
* * *
industry
gives
to
that
type
of
Lindsey, 850 F.3d at 1017; see United States v. Raza,
876 F.3d 604, 621 (4th Cir. 2017) (differentiating Universal Health
Services on the same ground), cert. denied, 585 U.S. 1017 (2018).
In other words, proof of the federal government’s practices is
ipso facto proof of “industry” practices.
testimony
that
a
certain
disclosures
misrepresentations
particular
were
would
investor
not
incapable
Here, by contrast, any
negligently
show
of
that
influencing
disregarded
petitioner’s
a
reasonable
decisionmaker.
Petitioners similarly err in arguing (25-7515 Pet. 17-18; 257522 Pet. 10-11) that the decision below conflicts with this
Court’s decision in Kousisis v. United States, 605 U.S. 114 (2025).
The Court there reiterated the standard definition of materiality
in fraud cases.
Id. at 131.
It did not suggest that an individual
victim’s idiosyncratic attachment of weight to a particular type
of misstatement could be used to prove that a reasonable actor
would attach no weight to that statement.
20
2.
Petitioners are incorrect in suggesting (25-7515 Pet.
19-22; 25-7522 Pet. 11-13) that the decision below conflicts with
the decisions of other courts of appeals.
Court’s
decision
in
Neder,
the
courts
Consistent with the
of
appeals
uniformly
recognize that “a fraud victim’s negligence” or “susceptibility”
to fraud “is not a defense to criminal charges under the federal
fraud statutes.”
Lindsey, 850 F.3d at 1014-1015 (citation and
internal quotations omitted); see, e.g., United States v. Brien,
617 F.2d 299, 311 (1st Cir.), cert. denied, 446 U.S. 919 (1980);
United States v. Thomas, 377 F.3d 232, 240-243 (2d Cir. 2004);
United States v. Coyle, 63 F.3d 1239, 1244 (3d Cir. 1995); United
States v. Colton, 231 F.3d 890, 903 (4th Cir. 2000); United States
v. Kreimer, 609 F.2d 126, 132 (5th Cir. 1980); United States v.
Betts-Gaston, 860 F.3d 525, 532-533 (7th Cir. 2017), cert. denied,
583 U.S. 1058 (2018); United States v. Kock, 66 F.4th 695, 705
(8th Cir. 2023); United States v. Joseph, 108 F.4th 1273, 1282
(10th Cir. 2024), cert. denied, 145 S. Ct. 2863 (2025); United
States v. Svete, 556 F.3d 1157, 1165 (11th Cir. 2009); United
States v. Maxwell, 920 F.2d 1028, 1036 (D.C. Cir. 1990); see also
United States v. Higgins, No. 22-3538, 2023 WL 6536752, at *3 (6th
Cir. Oct. 6, 2023).
Petitioners err in asserting (25-7515 Pet. 20; 25-7522 Pet.
12) that the decision below conflicts with the Fourth Circuit’s
decision in United States v. Raza.
The Fourth Circuit there -- in
the course of affirming the defendants’ fraud convictions, see
21
Raza, 876 F.3d at 606-607 -- cited the Ninth Circuit’s reasoning
in Lindsey approvingly and described that decision as “reach[ing]
the same conclusion” as the Fourth Circuit’s own precedent, id. at
619-621. Consistent with the circuit consensus, the Fourth Circuit
agreed that “the correct test for materiality” does not turn on
the conduct of “a renegade [victim] with a demonstrated habit of
disregarding
materially
false
information.”
Id.
at
621.
Petitioners emphasize (25-7515 Pet. 20; 25-7522 Pet. 12) that the
Fourth Circuit in Raza suggested that the Ninth Circuit had “barred
the evidentiary use of a lender’s past lending practices on the
materiality issue,” while the Fourth Circuit saw no need to “go so
far” in that case.
876 F.3d at 621.
As explained, however, pp.
14-17, supra, that understanding overreads Lindsey’s holding.
In
any event, petitioners identify no particular evidence that might
be excluded under the Ninth Circuit’s precedent but permissible in
other circuits.
MacRitchie is likewise incorrect in asserting a conflict with
the Second Circuit’s decision in United States v. Litvak, 889 F.3d
56 (2018).
See 25-7522 Pet. 11-12.
Consistent with the decision
below, the court in Litvak explained that when assessing “the views
of a hypothetical, reasonable investor in the market at issue” to
determine
materiality,
an
individual
witness’s
idiosyncratic and unreasonable viewpoint is not
* * *
of the views of a reasonable, objective investor.”
68-69.
“indisputably
probative
889 F.3d at
22
Petitioners also suggest (25-7515 Pet. 20; 25-7522 Pet. 12)
that the decision below and in Lindsey depart from other circuits
by
categorically
rejecting
the
potential
applicability
of
Universal Health Services in the context of a criminal fraud
prosecution.
But that suggestion rests on petitioners’ mistaken
view (discussed above) that Universal Health Services supports
their position here.
Lindsey itself did not deem Universal Health
Services categorically irrelevant; the court instead considered
that decision and described its own holding as “faithful to” that
decision.
850 F.3d at 1017.
In each of the decisions of other circuits that petitioners
cite, each panel merely cited Universal Health Services for its
definition of “materiality.” See United States v. Clark, 140 F.4th
395, 418 (7th Cir. 2025); United States v. Palin, 874 F.3d 418,
422-423 (4th Cir. 2017), cert. denied, 584 U.S. 917, and 584 U.S.
955 (2018); United States v. Ferriero, 866 F.3d 107, 120-122 (3d
Cir. 2017), cert. denied, 583 U.S. 1121 (2018).
None of those
decisions addressed the extent to which particular investors’
behavior could be considered when evaluating materiality.
See
Palin, 874 F.3d at 423 (“We do not believe the Supreme Court
intended to broadly ‘overrule’ materiality standards that had
previously applied in the context of criminal fraud.”).
3.
for
At all events, this case would be an unsuitable vehicle
addressing
harmless.
the
question
presented
because
any
error
was
As the court of appeals detailed, the district court’s
23
“evidentiary rulings did not prevent” petitioners “from urging
legitimate disclosure-based defense theories.”
Pet. App. 40.
The
district court admitted the relevant documents that contained the
additional disclosures to investors; several investors “admitted
those documents were material to their decisions”; the court
“admitted defense expert testimony about the[] documents”; the
court “allowed extensive questioning of investors who had read
them about their contents”; petitioners “were allowed to crossexamine investors about their claims that they had not read” the
documents; and petitioners “were allowed to attack the investors’
credibility.”
Id. at 40-42.
Petitioners also were permitted to argue that the written
disclosures (such as the PPMs) “were accurate” and “material to
investors,”
and
to
argue
that
“their
provision
disclosures to investors was evidence of good faith.”
41-42.
of
written
Pet. App.
Petitioners thus were not prevented from mounting their
preferred defense, and they identify no specific testimony that
was excluded that might have altered the jury’s assessment of the
falsity or materiality of their statements or of their intent to
defraud.
24
CONCLUSION
The petitions for writs of certiorari should be denied.
Respectfully submitted.
D. JOHN SAUER
Solicitor General
A. TYSEN DUVA
Assistant Attorney General
ANDREW C. NOLL
Attorney
SEPTEMBER 2026
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.