KENNETH WAYNE ROWLAND, PETITIONER V. UNITED STATES OF AMERICA No. 86-5312 In the Supreme Court of the United States October Term, 1986 On Petition For a Writ of Certiorari to the United States Court of Appeals for the Fifth Circuit Memorandum for the United States in Opposition Petitioner contends that his filing of a forged document with a federal bankruptcy court falls outside the scope of the false statement statute, 18 U.S.C. 1001. 1. After entering a conditional plea of guilty in the United States District Court for the Northern District of Mississippi, petitioner was convicted on one count of making a false statement in a matter within the jurisdiction of a federal department or agency, in violation of 18 U.S.C. 1001. He was sentenced to three years' imprisonment. The court of appeals affirmed (789 F.2d 1169; Pet. App. A). At a hearing on petitioner's guilty plea, the government provided the district court with a description of the factual basis for the prosecution, as required by Fed. R. Crim. P. 11. At trial, the government would have established that petitioner and three of his "companies" were debtors in bankruptcy proceedings pending before the bankruptcy court in the Northern District of Mississippi and that the bankruptcy court notified the debtors (including petitioner) that in return for their posting of a performance bond guaranteeing the payment of daily rental, the court would authorize the trustee to lease to them various assets of their estates for a per diem rental of $250. Petitioner thereafter filed with the court a bond purportedly executed by Travelers Indemnity Company as surety, which petitioner signed in his individual capacity and as representative of the two debtor corporations and the debtor partnership. Based on the bond, petitioner secured possession of the assets, which he subsequently dissipated to the detriment of the creditors. Petitioner also defaulted on the rental payments. When the trustee called upon the surety for performance, the trustee discovered that the signature of the surety's attorney was forged. Pet. App. 1170. 2. 18 U.S.C. 1001 prohibits the making of a false statement "in any matter within the jurisdiction of any department or agency of the United States." Petitioner contends that his filing of a fraudulent performance bond falls outside the scope of Section 1001. The court of appeals correctly rejected petitioner's claim. In United States v. Bramblett, 348 U.S. 503, 509 (1955), this Court held that the phrase "department or agency" in Section 1001 includes "the executive, legislative and judicial branches of the government" (emphasis added). Several courts of appeals have since distinguished between the judiciary's "administrative" or "housekeeping" function and its "adjudicative" function, holding that the statute does not apply to false statements implicating only the latter. See United States v. Plascencia-Orozco, 768 F.2d 1074, 1076 (9th Cir. 1985); United States v. Abrahams, 604 F.2d 386, 392-393 (5th Cir. 1979); United States v. Erhardt, 381 F.2d 173, 175 (6th Cir. 1967); Morgan v. United States, 309 F.2d 234, 237 (D.C. Cir. 1962); cert. denied, 373 U.S. 917 (1963). Two courts of appeals that have adopted this distinction appear, however, to limit the "adjudicative" function exception to private civil actions in which the United States is not a party. See, e.g., United States v. London, 714 F.2d 1558, 1560-1562 (11th Cir. 1983); United States v. D'Amato, 507 F.2d 26, 29 (2d Cir. 1974). While the federal government has not acknowledged the validity of any of these distinctions, /1/ this case does not present that threshold legal issue. As the court of appeals found, petitioner's fraudulent statement occurred pursuant to the bankruptcy court's administrative function and, consequently, it falls within the scope of Section 1001, regardless of the validity of the purported distinction between administrative and adjudicative judicial functions. This case also does not present, contrary to petitioner's claim (Pet. 3-13), an opportunity for this Court to address possible inconsistencies among the courts of appeals concerning the precise scope of the "adjudicative" function exception. This case involves a classic instance of a false statement made to a court acting solely in its administrative capacity. At the time petitioner filed the false performance bond, the relevant judicial proceeding was already completed. The sole purpose of the bond was to allow petitioner and the other debtors to take advantage of the court order authorizing the trustee to lease to the debtors various assets of their estates upon the filing of a performance bond. The cases upon which petitioner relies in arguing that there are inconsistencies in certain circuit court rulings do not involve circumstances even remotely comparable to those present in this case. Hence, any possible inconsistency among those decisions has no bearing on this case. Petitioner contends (Pet. 13-15), nonetheless, that the decision of the court of appeals in this case conflicts with the Ninth Circuit's decision in United States v. Mayer, 775 F.2d 1387 (1985). No conflict is present. Mayer concerned false documents filed with the trial court that were relevant to, and designed to influence, the defendant's sentencing. Unlike the false performance bond in this case, therefore, the false documents filed with the trial court in Mayer were designed to influence the outcome of an ongoing judicial proceeding. Finally, petitioner claims (Pet. 15) that the decision of the court of appeals conflicts with United States v. D'Amato, supra, and United States v. London, supra, both of which held that Section 1001 does not apply to false statements made in the course of "private civil actions." This claim of conflict fails, however, because neither decision suggests that the "private civil action" exception to Section 1001 applies to false statements made to a court that is acting solely in its administrative capacity. In D'Amato, the false statement was an affidavit filed with a court in the course of a judicial proceeding (see 507 F.2d at 27). The Second Circuit in D'Amato specifically noted that courts had applied Section 1001 to administrative judicial functions, but distinguished those cases on the ground that "here, (there was) a false statement within the 'judicial machinery' of the court" (id. at 29, quoting Morgan v. United States, 309 F.2d at 237). The Eleventh Circuit ruling in United States v. London is also distinguishable from this case. In London, the false statement was made by a lawyer to his clients and not to the court. The Eleventh Circuit reversed the conviction on the ground that Section 1001 applies "only to prevent misrepresentations to the government" and there were not any in that case (see 714 F.2d at 1561 (emphasis in original)). In this case, however, petitioner's false statement was filed with the court. /2/ It is therefore respectfully submitted that the petition for a writ of certiorari should be denied. CHARLES FRIED Solicitor General OCTOBER 1986 /1/ This Court has not addressed the issue of the validity of the distinction. See United States v. Rodgers, 466 U.S. 475, 483 n.4 (1984). /2/ We note also that the United States, as petitioner's largest unsecured creditor with a claim of $90,000 against the bankrupt estate, had a substantial stake in the bankruptcy proceeding. See U.S. Br. Ct. App. 5-7, citing I R. 43-46. The false performance bond was the vehicle by which petitioner was able to dissipate the assets of the estate to the detriment of the United States. In these circumstances, the filing of the false bond was plainly a fraud affecting the United States.