No. 97-5704 IN THE SUPREME COURT OF THE UNITED STATES OCTOBER TERM, 1997 ELMER STRONG, PETITIONER v. UNITED STATES OF AMERICA ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SEVENTH CIRCUIT BRIEF FOR THE UNITED STATES IN OPPOSITION SETH P. WAXMAN Acting Solicitor General JOHN C. KEENEY Acting Assistant Attorney General DANIEL S. GOODMAN Attorney Department of Justice Washington, D.C. 20530-0001 (202) 514-2217 ---------------------------------------- Page Break ---------------------------------------- QUESTION PRESENTED Whether the jury was properly instructed on the elements of the offense of knowingly making a false, Fictitious, or fraudulent claim, in violation of 18 U.S.C. 287. (I) ---------------------------------------- Page Break ---------------------------------------- IN THE SUPREME COURT OF THE UNITED STATES OCTOBER TERM, 1997 No. 97-5704 ELMER STRONG, PETITIONER v. UNITED STATES OF AMERICA ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SEVENTH CIRCUIT BRIEF FOR THE UNITED STATES IN OPPOSITION OPINION BELOW The opinion of the court of appeals ( Pet. App . B2-B5) is unpublished, but the judgment is noted at 114 F.3-d 1192. JURISDICTION The judgment of the court of appeals was entered on May 20, 1997. The petition for a writ of certiorari was filed on August 18, 1997. 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 Central District of Illinois, petitioner was convicted on ten counts of presenting false claims to the government, in violation ---------------------------------------- Page Break ---------------------------------------- 2 of 18 U.S.C. 287. He was sentenced to 15 months' imprisonment, to be followed by two years' supervised release. The court of appeals affirmed. Pet. App. B2-B5. 1. In 1991 and 1992, petitioner owned several gasoline stations. At that time, federal law required gasoline dealers to pay a retail tax of 14.1 cents per gallon. To encourage sales of gasoline mixed with alcohol, the government refunded 4.44 cents per gallon for sales of gasoline mixed with at least ten percent alcohol. Pet. App. B2. In order to obtain the refund, gasoline dealers were-required to file with the government a Form 843, which sets forth the percentage of alcohol that was mixed with gasoline. Petitioner filed with the government ten Form 843s seeking refunds of more than $70,000. A subsequent investigation by the Internal Revenue Service revealed that petitioner had not purchased enough alcohol to produce a gasoline mixture with a ten percent alcohol content- Petitioner eventually admitted that his gasoline mixture contained only four to six percent alcohol. Id. at B3. Petitioner was indicted by a grand jury on ten counts of filing false, fictitious, or fraudulent claims with the government, in violation of 18. U.S.C. 287. Section 287 i-reposes criminal penalties on anyone who "makes or presents * * * any claim upon or against the United States, or any department or agency thereof, knowing such claim to be false or fictitious, or fraudulent. At trial, petitioner claimed that he believed that he was entitled to the tax refund, even though he did not use ten percent alcohol in his gasoline mixture, and that he had lacked an intent ---------------------------------------- Page Break ---------------------------------------- 3 to defraud the government. Pet. App. B3. The court refused petitioner's proffered jury instruction that would have required the government to prove "specific intent * * * that the defendant knowingly did an act which the law forbids, purposely intending to violate the law. Ibid Instead, the court instructed the jury that in order to find petitioner guilty of making a false claim, the jury must find (1) "[t]hat the defendant made a claim against or presented a claim to the United States through the Internal Revenue Service"; (2) "[t]hat the claim was false, fictitious, or fraudulent"; and (3) "[t]hat the defendant knew at the time that the claim was made that it was false, fictitious, or " fraudulent. " Id. at B3-B4, D1. The court further instructed the jury that "[a] statement is false or fictitious if untrue when made, and then known to he untrue by the person making it or causing it to be made," and that "[a] statement or representation is `fraudulent' if known to be untrue, and made or caused to be made with the intent to deceive. " Id. at B4. The jury found petitioner guilty on all ten counts of making a false claim. Pet. App. A, B4. 2. In an unpublished opinion, the court of appeals affirmed. Pet. App. B2-B5. The court rejected petitioner's argument that the district court should have instructed the jury that a "specific intent to defraud the government" is an element of a false claim offense under Section 287, and held that "[p]roof of specific intent to defraud the government is not required to convict under [Section] 287." Id. at B4. The court of appeals relied on the "plain language'' of the statute, and its recent decision in United ---------------------------------------- Page Break ---------------------------------------- 4 States v. Catton, 89 F.3d 387, 392 (1996), which similarly had held that an intent to defraud is not an element of submitting a false claim under Section 287. Pet. App. B4. Accordingly, the court concluded that "the district court did not err in instructing the jury. " Id. at B5.1 ARGUMENT 1. Petitioner contends (Pet. 11) that the decision in this case conflicts with decisions of other courts of appeals on whether 19 U.S.C. 287 requires proof of intent to defraud. That claim lacks merit and does not warrant further review. a. The court of appeals correctly held that an intent to defraud is not a requisite element of making a false claim under Section 287. That statute prohibits making or presenting a claim to any United States agency, knowing that the claim is "false, fictitious, or Fraudulent. " 18 U.S.C. 287. Thus , "[S]ection 287 is phrased in the disjunctive, and a conviction under that statute may therefore be based on proof that a claim submitted to the government is either false, fictitious or fraudulent. " United States v. Blecker, 657 F.2d 629, 634 (4th Cir. 1981), cert. denied, ___________________(footnotes) 1 The court of appeals also observed, as the district court similarly had instructed the jury, Pet. App. B4, that " [a] statement is 'false' or 'fictitious', if untrue when made, and then known to be untrue by the person making it or causing it to be made," and that "[al statement or representation is `fraudulent' if known to be untrue, and made or caused to be made with the intent to deceive "the government agency to whom submitted." Id. at B5 n.l (quoting United States v. Milton, 602 F.2d 231, 233 (9th Cir. 1979)). `Under those definitions, the court continued, "an intent to deceive only becomes relevant when the government attempts to prove that the statement was fraudulent." Ibid. (quoting Milton, 602 F.2d at 233). ---------------------------------------- Page Break ---------------------------------------- 5 454 U.S. 1150 (1982); see also United States v. Irwin, 654 F.2d 671, 683 (10th Cir. ) ("The disjunctive term `or' clearly indicates that making any one of the three types of proscribed claims would subject the claimant to criminal liability. Thus, a claim need not be fraudulent so long as it is- false or fictitious. " (citations omitted) ) , cert. denied, 455 Us. 1016 (1982); see also United States v. Barker, 942 F.2d 585, 588 (1991) ("Section 287 contains no requirement that the intent, purpose, or effect of the false claim must be to cause the government a loss. ") , superseded, 967 F.2d 1275 (9th Cir. 1992). Indeed, Section 287 is worded similarly to 18 U.S.C. 1001, which also punishes anyone who, in any matter within the jurisdiction of the Federal government, "knowingly and willfully * * * makes any false, fictitious, ox fraudulent statements. " As this Court observed with respect to Section 1001, "[n]oticeably lacking * * * is any requirement that the prohibited conduct be undertaken with specific intent to deceive the Federal Government. " United States v. Yermian, 468 U.S. 63, 73 (1984) ; see also Browder v. United States, 312 U.S. 335, 340 (1941) (holding that 18 U.S.C. 1542, which punishes anyone who "willfully and knowingly" uses a passport obtained by a "false statement, " does not require proof of a use "which is in itself evil as the use of a passport to invoke fraudulently the protection of the United States abroad") (internal quotation marks omitted). Accordingly, because petitioner was convicted of knowingly presenting false claims to the government (Pet. 9; Pet. App. A), the jury correctly was instructed that it ---------------------------------------- Page Break ---------------------------------------- 6 could find the defendant guilty if it found beyond a reasonable doubt that the defendant made a false claim while knowing the claim to be untrue. See Pet. App. B4-B5, D1-D3.2 b. Contrary to petitioner's contention (Pet. 11) , there is not a conflict in the courts of appeals on whether a false claim offense under Section 287 requires proof of an intent to defraud. In support of his contention, petitioner simply attaches commentary to pattern jury instructions that cites United States v. Drape, 668 F.2d 22 (1st Cir. 1982), and United States v. Rifen, 577 F.2d 1111. (8th Cir. 1978), for the proposition that "the First and Eighth Circuits have required an intent to defraud under [Section] 287." Pet. App . C2.3 Those decisions do not hold, however, that an intent to defraud is an element of making or presenting a false claim under Section 287. Indeed, as the commentary itself observes ibid., the Eighth Circuit's decision in Rifen involved a defendant who was charged with making fraudulent claims under the statute. See Rifen 577 F.2d at 1113 ("the evidence is * * * ___________________(footnotes) 2 The other appellate decisions -cited by petitioner (Pet. 11) , which interpret statutes different from Section 287, do not support his contention that an intent to defraud is a requisite element for a false claim offense under Section 287. The decision in United States v. Leech, 996 F.2d 158 (7th Cir. 1993), cert. denied, 510 Us. 1047 (1994), involved 18 U.S.C. 152, which expressly requires fraudulent conduct. Similarly, in United States v. Lewis, 406 F.2d. 486 (7th Cir.), cert. denied, 394 U.S. 1013 (1969), the defendant was charged with fraudulent conduct under 18. U.S.C. 289 and 371. In any event, the decision in Lewis does not address the issue of the requisite level of criminal intent under either statute. 3 Petitioner appears to have attached the pattern jury instructions from the Seventh Circuit- See The Federal Criminal Jury Instructions of the Seventh Circuit, Vol. II, Chap. 15, 40- 41 (1983). ---------------------------------------- Page Break ---------------------------------------- 7 sufficient to sustain the jury's verdict on the three counts of making a fraudulent claim against an agency of the United States") . Similarly, the First Circuit's decision in Drape does not hold that an intent to defraud is a requisite element under Section 287. That decision involved a defendant convicted under Section 287 for making a false tax return. The court simply cited Rifen as supporting the notion that "[w]here a tax return is filed with the `guilty, actual knowledge that it was false, ` the jury may infer the requisite intent to defraud the government."- Drape, 668 F.2d at 26. In describing the necessary mens rea that would support the jury's verdict, however, the court of appeals found sufficient "[evidence indicating that [the defendant] knew what he was doing" and did not require additional evidence indicating an intent to defraud. Ibid Accordingly; because petitioner points to no decision holding that an intent to defraud is an element of a false claim offense under Section 287, the decision below does not present a conflict that warrants this Court's review. 2. Petitioner also suggests (Pet. 11) that the jury should have been instructed on the element of willfulness or intent requirement that the Defendant act with a purpose or awareness that he is doing something that is wrong or the law forbids "4 ___________________(footnotes) 4 Petitioner requested a jury instruction (Pet. App. E2) that would have required the government to "prove that the defendant knowingly did an act which the law forbids, purposefully intending to violate the law." Petitioner also requested (id. at E3) that the jury be instructed that [a]n act is done willfully if done voluntarily and intentionally, and with intent to do something the law forbids, " and that [w]illfulness in criminal tax cases requires the government to prove that the (continued. . . ) ---------------------------------------- Page Break ---------------------------------------- 8 Petitioner cites (ibid.) the Fourth Circuit's decision in United States v. Maher, 582 F.2d 842 (1978), cert. denied, 439 U.S. 1115 (1979), in which the trial court had refused to instruct the jury that a false claim offense under Section 28.7 requires an intent to defraud, but instead had instructed the jury that the government had to prove that the defendant knowingly caused a false claim to be made and that he acted "willfully, by acting with either a consciousness that he was doing something wrong or with a specific intent to violate the law. " Id. at 845. The court of appeals held that a false claim offense under Section 287 "does not require proof of a specific intent to defraud. Id at 847. The court also found that the district court properly instructed the jury that Section 287 "may be violated by the submission of a false claim, a fictitious claim, or a fraudulent claim, if * * * the defendant acted with knowledge that the claim was false or. fictitious or fraudulent and with consciousness that he was either doing something which is wrong or which violated the law." Ibid (citations omitted). In approving the trial court's jury instructions which included a requirement of knowledge of wrongdoing or illegality, however, the court in Maher did not hold that a jury must be so instructed. Indeed, "[t]he primary issue" confronting the court in that case was "whether the criminal intent essential for conviction [under Section 287] is * * * limited to a ___________________(footnotes) 4 (... continued) defendant had actual knowledge of the provisions of the Internal Revenue Code at issue and that he voluntarily and intentionally violated its duties. " ---------------------------------------- Page Break ---------------------------------------- 9 specific intent to defraud. Id. at 843.5 Moreover, if the Fourth Circuit is ever presented with the issue, it likely will conclude that "willfulness" is not a requisite element under Section 287. There is no language in the statute requiring proof that "the defendant act "willfully" or with any intent to violate the law. In a decision rendered after Maher the Fourth Circuit in United States v. Blecker, 657 F.2d at 634, discussed the elements of a Section 287offense without any reference to the word "Willfully" , and without requiring that the defendant act with a purpose to disobey the law. Moreover, Maher was decided before this Courts decision in Yermian, supra, in which the Court described the mental element of 18 U.S.C. 1001 which does employ the term "willfully" as requiring proof only of "intentional and deliberate lies." 468 U.S. at 74. Relying on the Court's decision in Yermian, the Fourth Circuit recently concluded in United States v. Daughtry, 48 F.3d 829, 832, "vacated on other grounds, 116 S. Ct. 510 (1995) , that the word "willfully" in Section 1001 does not require an intentional violation of the law. The court in Daughtry also rejected the defendants reliance on Maher. The court noted that "[t]he word 'willfully does not I ___________________(footnotes) 5 Petitioner also cites (Pet. 11) two decisions in which the courts of appeals do not address whether "willfulness" is a requisite element of Section 287, but simply note that the district court had given a jury instruction that contained the element of "willfulness. " See Milton, 602 F.2d at 232-233 & n.6; Barker, 942 F.2d at 588-589. Petitioner also relies (Pet. 11) on United States V. Krietemeyer, 506 F. Supp. 289 (S.D. Ill. 1.981)) . That decision, however, involves the civil false claims statute and does not contain any discussion of the word "willfully" or "willfulness. " ---------------------------------------- Page Break ---------------------------------------- 10 appear in [Section] 287 the district court apparently read it into the statute. " Id., at 832 n*.6 In light of the developments in the law since the Fourth Circuit's decision in Maher , the Fourth Circuit is likely to hold, if presented with the issuer that neither "willfulness if nor an intent to violate the law is an element of a Section 287 offense. Thus , further review by this Court is not warranted.7 CONCLUSION The petition for a writ of certiorari should be denied. Respectfully submitted. SETH P. WAXMAN Acting Solicitor General JOHN C. KEENEY Acting Assistant Attorney General DANIEL S. GOODMAN Attorney OCTOBER 1997 ___________________(footnotes) 6 The court in also discussed this Court's decision in Ratzlaf v. United States, 510 Us. 135 (1994). Although in that case the Court defined the term "willfully" in 31 Us. 5322(a) to require knowledge of illegality, the Court reiterated that the meaning of the word "willfully" varies depending on the context in which the word is used, 510 U.S. at 141, and that "ignorance of the law generally is no defense to a criminal charge, " id. at 149. 7 Additionally, this case would not be an appropriate vehicle to address whether an intent to violate the law should be read into Section 287, because the decision below does not directly address the issue. Although the court below cites decisions concluding that "willfulness" is not an element of Section 287, those decisions either equated "willfulness" with an intent to defraud (United States v. Catton, 89 F.3d at 392; United States v. Ferguson, 793 F.2d 828, 831 (7thCir.), cert. denied, 479 U.S. 933 (1986)), or did not define the "specific level of culpability that would constitute "willfulness" (United States v. Irwin, 654 F.2d at 682).