No. 95-887 IN THE SUPREME COURT OF THE UNITED STATES OCTOBER TERM, 1995 ROBERT W. WAYMER, PETITIONER v. UNITED STATES OF AMERICA ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT BRIEF FOR THE UNITED STATES IN OPPOSITION DREW S. DAYS, III Solicitor General JOHN C. KEENEY Acting Assistant Attorney General RICHARD A. FRIEDMAN Attorney Department of Justice Washington, D.C. 20530 (202) 514-2217 ---------------------------------------- Page Break ---------------------------------------- QUESTIONS PRESENTED 1. Whether 18 U.S.C. 1346's provision that a fraudulent scheme under the mail fraud statute "includes a scheme or artifice to deprive another of the intangible right of honest services" is unconsti- tutionally vague as applied to the facts of this case. 2. Whether the court of appeals correctly affirmed the mail fraud conviction of a school board member who failed to disclose the nature of his financial relationship with a vendor of services to the school system where that financial relationship would have been material to the school board in bidding on or negotiating contracts for such services. (1) ---------------------------------------- Page Break ---------------------------------------- TABLE OF CONTENTS PAGE Opions below. . . .1 Jurisdiction . . . .1 Statement . . . .2 Argument . . . .5 Conclusion . . . .9 TABLE OF AUTHORITIES Cases: Buckley v. Valeo, 424 U.S. 1 (1976) . . . .6, 7 Chapman v. United States, 500 U.S. 453 (1991) . . ..7 Kolender v. Lawson, 461 U.S. 352 (1983) . . . .5, 6 McNally v. United States, 483 U.S. 350 (1987) . . . .3,4 Parker v. Levy, 417 U.S. 733 (1974) . . . .7 United States v. Bohnus, 628 F.2d 1167 (9th Cir.), cert. denied, 447 U.S. 928 (1980). . . .6 United States v. Bryan, 58 F.3d 933 (4th Cir. 1995) . . ..6 United States v. Harriss, 347 U.S. 612 (1954) . . . .6 United States v. Margiotta, 688 F.2d 108 (2nd Cir. 1982) cert. denied, 461 U.S. 913 (1983) . . . .6 United States v. Mazurie, 419 U.S. 544 (1975) . . . .7 United States v. McNeive, 536 F.2d 1245 (8th Cir. 1976) . . . .9 United States v. Rabbitt, 583 F.2d 1014 (8th Cir. 1978), cert. denied, 439 U.S. 1116 (1979 . . . .7, 8, 9 Constitution and statutes: U.S.Const.: Amend. I . . . .7 Amend V (Due Process Clause) . . . .5, 6 Anti-Drug Abuse Act of 1988, Pub. L. No. 100-690, 7603, 102 Stat. 4508 (18 U.S.C. 1346) . . . .4, 5, 6, 7 18 U.S.C. 1341 . . . . 2, 3, 4 18 U.S.C. 1956(a)(1)(B)(i) . . . .2, 3 (III) ---------------------------------------- Page Break ---------------------------------------- In the Supreme Court of the United States OCTOBER TERM, 1995 No. 95-887 ROBERT W. WAYMER, PETITIONER v. UNITED STATES OF AMERICA ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT BRIEF FOR THE UNITED STATES IN OPPOSITION OPINION BELOW The opinion of the court of appeals (Pet. App. la- 13a) is reported at 55 F.3d 564. JURISDICTION The judgment of the court of appeals was entered on June 16, 1995. A petition for rehearing was denied on September 7, 1995. Pet. App. 26a. The petition for a writ of certiorari was filed on December 5, 1995. The jurisdiction of this Court is invoked under 28 U.S.C. 1254(1). (1) ---------------------------------------- Page Break ---------------------------------------- 2 STATEMENT Following a jury trial in the United States District Court for the Northern District of Georgia, peti- tioner was convicted on 22 counts of mail fraud, in violation of 18 U.S.C. 1341, and 11 counts of money laundering, in violation of 18 U.S.C. 1956(a)(l)(B)(i). He was sentenced to concurrent terms of 33 months' imprisonment on each count of conviction. The court of appeals affirmed. Pet. App. la-13a. 1. Petitioner Robert W. Waymer an elected member of' the Atlanta Board of Education (the Board). Peatroos Service Company, a subsidiary of the Alien Service Company, of which Buddy Allen was the President and General Manager, became a sup- plier of services to the schools. In 1986, Allen agreed to pay John Assmar, a real estate broker, a 15% commission on the gross proceeds of any service contracts Assmar obtained on behalf of Allen's com- panies. In 1986, Allen, acting on behalf of Peatross, began a pilot sanitation and pest-control program for two Atlanta public schools. By the 198$-1989 school year, Allen's companies provided pest control and other services. to all 113 Atlanta public schools. Pet. App. la-2a. In mid-1988, Assmar died. After Assmar's death, petitioner informed Allen that he and Assmar had been partners and that he wanted to assume Assmar's role in Allen's school system contracts. Allen ultimately agreed to pay petitioner the 15% commis- sion if petitioner provided him with an assurance from the school system that petitioner could do business with him while being a member of the Board, Pet. App. 2a. ---------------------------------------- Page Break ---------------------------------------- 3 Petitioner told Dr. Woodrovv Wilson, the Associate Superintendent of the Atlanta school system, that he was considering doing business with a person who did business with the school system. Wilson advised petitioner that such a practice was permissible if the other party's business with the school system was accomplished through a sealed-bid procedure. Wilson further advised that petitioner should abstain from voting on any matters involving that business that came before the Board, and that he should disclose the relationship to the Board and to the Superintendent. Petitioner subsequently wrote to inform Wilson that he was engaged in real estate and marketing activi- ties with Allen, that he had done consulting work for Allen since 1986, and that he would make full disclosure of his relationship with Allen. That letter did not, however, inform Wilson that petitioner would receive a 15% commission on Allen's contracts with the school system without being required to perform substantial services. Neither petitioner nor Wilson took the matter before the entire Board. From 1989 through 1991, petitioner received more than $200,000 in payments from Allen's companies. Pet. App. 2a-3a. 2. The federal mail fraud statute prohibits the use of the mails in furtherance of "any scheme or artifice to defraud." 18 U.S.C. 1341. Before this Court's deci- sion in McNally v. United States, 483 U.S. 350 (1987), the courts of appeals had consistently construed Section 1341 to apply to schemes intended to deprive citizens of their right to honest services from public officials. See Pet. 8. The Court in McNally reached the opposite conclusion, holding that Section 1341 was "limited in scope to the protection of property rights." 483 U.S. at 360. The Court stated that Con- gress "must speak more clearly than it has" if it ---------------------------------------- Page Break ---------------------------------------- 4 wishes to criminalize a broader range of fraudulent conduct. Ibid. The following year Congress amended the Criminal Code to provide that, for purposes of applying the mail fraud statute, "the term `scheme or artifice to defraud' includes a scheme or artifice to deprive another of the intangible right of honest services." Pub. L. No. 100-690, $7603, 102 Stat. 4508 (18 U.S.C. 1346). 3. Petitioner was charged with .24 counts of mail fraud, in violation of 18 U.S.C. 1341 The indictment alleged that petitioner had engaged in (1) a scheme to defraud the citizens of Atlanta of petitioner's honest services, and (2) a scheme to defraud Allen of money and property. Petitioner was also charged with 11 counts of money laundering, in violation of 18 U.S.C. 1956(a)(l)(B)(i), in which the alleged mail fraud constituted the source of the laundered proceeds. Pet. App. 3a. The district court granted a motion for judgment of acquittal on two of the mail fraud counts. The jury found petitioner guilty on all remaining mail fraud counts based on the scheme to deprive the citizens of Atlanta of petitioner's honest services, but deadlocked on petitioner's guilt regarding the alleged scheme to defraud Allen of money and property. The jury also convicted petitioner on all money-laundering counts. Pet. App. 3a. 4. The court of appeals affirmed. Pet. App. la-13a. The court rejected petitioner's argument that Sec- tion 1346 is unconstitutionally vague. Pet. App. 5a-6a. It explained that a statute is riot unconstitutionally vague if it "define[s] the criminal offense with suffi- cient definiteness that ordinary people can under- stand what conduct is prohibited and in a manner that does not encourage arbitrary and discriminatory ---------------------------------------- Page Break ---------------------------------------- 5 enforcement." Id. at 5a (quoting Kolender v. Lawson, 461 U.S. 352, 357 (1983)). Because petitioner's chal- lenge did not involve the First Amendment, the court observed, its inquiry was limited to the question whether the statute was unconstitutionally vague as applied to the facts of the particular case. Pet. App. 5a. The court of appeals rejected the vagueness chal- lenge, stating that a conviction under the mail fraud statute requires specific intent to defraud, and that petitioner had not contested the adequacy of either the jury instructions or the proof on the element of specific intent. Id. at 6a. Petitioner also contended that his nondisclosure of the details of his business agreement with Allen could not form the basis for a mail fraud conviction, because those details were not material facts. Pet. App. 12a. The court rejected that contention, explaining that "[flora School Board member to be receiving a direct and substantial cut from a vendor's contract with the school system in exchange for the performance of virtually no services so obviously smacks of impropri- ety that it can hardly be characterized as a minor detail of which the Board need not be apprised." Ibid. Had the- Board known that Allen's contracts were inflated by the 15% commission paid to petitioner, the court observed, "it likely would have re-bid the con- tracts at a considerable savings to the citizens of Atlanta." Id. at 12a-13a. ARGUMENT 1. Petitioner argues (Pet. 7-15) that Section 1346's definition of mail fraud to include the use of the mails "to deprive another of the intangible right of honest services" is unconstitutionally vague, in violation of the Due Process Clause of the Fifth Amendment. ---------------------------------------- Page Break ---------------------------------------- 6 That claim is without merit and does not warrant this Court's review.* "Due process requires that a criminal statute pro- vide adequate notice to a person of ordinary intelli- gence that his contemplated conduct is illegal, for `no man shall be held criminally responsible for conduct which he could not reasonably understand to be pro- scribed.'" Buckley v. Valeo, 424 U.S. 1, 77 (1976) (quoting United States v. Harriss, 347 US. 612, 617 (1954)). "[T]he void-for-vagueness doctrine requires that a penal statute define the criminal offense with sufficient definiteness that ordinary people can un- derstand what conduct is prohibited and in a manner that does not encourage arbitrary and discriminatory enforcement.." Kolender v. Lawson, 461 U.S. at 357. Petitioner attacks Section 1346 as vague based upon its potential to criminalize "common political prac- tices," such as a public official's performance for po- litical gain of an act that imposes unnecessary costs on taxpayers, or a candidate's mailing of a brochure containing a promise the candidate knows he cannot keep. See Pet. 11-12. Under this Court's precedents, however, petitioner cannot obtain reversal of his convictions by showing that hypothetical situations may exist in which appli- cation of the statute would be ambiguous. Rather, he ___________________(footnotes) * The only other court of appeals to consider a vagueness challenge to Section 1346 has also rejected the claim. See United States v. Bryan, 58 F.3d 933, 941-942 (4th Cir. 1995). Vagueness challenges were also consistently rejected in pre- McNally cases applying the mail fraud statute to schemes to deprive the citizenry of intangible rights. See, e.g., United States v. Margiotta, 688 F.2d 108 (2d Cir. 1982), cert. denied, 461 US. 913 (1983); United States v. Bohonus, 628 F.2d 1167, 1173-1175 (9th Cir.), cert. denied, 447 U.S. 928 (1980). ---------------------------------------- Page Break ---------------------------------------- 7 can prevail only by demonstrating that the statute failed to provide clear warning that his own conduct was proscribed. See Chapman v. United States, 500 U.S. 453, 467 (1991) ("First Amendment freedoms are not infringed * * * so the vagueness claim must be evaluated as the statute is applied to the facts of this case."); United States v. Mazurie, 419 U.S. 544, 550 (1975) ("[Vagueness challenges to statutes which do. not involve First Amendment freedoms must be exam- ined in the light of the facts of the case at hand."); Parker v. Levy, 417 U.S. 733, 756 (1974) ("One to whose conduct a statute clearly applies may not suc- cessfully challenge it for vagueness."). As the court of appeals observed in explaining why petitioner's acts were proscribed by the statute, "[for a School_ Board member to be receiving a direct and substantial cut from a vendor's contract with the school system in exchange for the performance of virtually no services so obviously smacks of impropriety that it can hardly be characterized as a minor detail of which the Board need not be apprised." Pet. App. 12a. Be- cause "a person of ordinary intelligence: Buckley, 424 U.S. at 77, would know that petitioner was obli- gated to disclose the terms of his agreement with Allen, the application of Section 1346.. did not violate due process. 2. Petitioner argues (Pet. 15-17) that an essential element of a public official's scheme to defraud based on his failure to disclose an improper financial rela- tionship is that he have "exercised the authority of his office to advance that relationship." Pet. 15. Peti- tioner asserts that the court of appeals' decision con- flicts with the Eighth Circuit's pre-McNally ruling in United States v. Rabbitt, 583 F.2d 1014 (8th Cir. 1978), cert. denied, 439 U.S. 1116 (1979). In Rabbitt, ---------------------------------------- Page Break ---------------------------------------- 8 the majority leader of the Missouri House of Repre- sentatives received a ten percent commission from an architectural firm that he recommended for state contracts. He failed to disclose that interest, but he had no responsibility, and took no action, respecting the awarding of those contracts. The Eighth Circuit reversed his mail fraud conviction. The court recog- nized that "[t]he concept of fraud upon the public may clearly fall within the ambit of the mail fraud statute where dishonest conduct by a public official directly implicates the functions and duties of that official's public office." 583 F.2d at 1024. The court questioned, however, "[w]hether a showing of dishonesty on the part of a state official, outside his official duties, with no financial loss to the state constitutes a fraud upon the public." ibid. The court distinguished other cases as involving fraudulent conduct that "deprived the public either of some potential tangible gain such as favorable contracts, or of its right to honest and fair dealing in the conduct of the officer in question, or of its right to disclosure of the officer's interest in the transaction at issue." Id. at 1025 (footnotes omitted). In the instant case, petitioner failed to disclose crucial aspects of his agreement with Allen despite the Associate Superintendent's instruction that the relationship should be disclosed. The court of appeals observed, moreover, that if petitioner had made the required disclosures, the contracts with A1len's com- panies would likely have been rebid or renegotiated. Pet. App. 12a-13a. Had petitioner been performing honest services as a School Board member, he would not have concealed from the Board information "strongly suggesting] that there were at least fif- teen percent of unnecessary expenses in Allen's bids ---------------------------------------- Page Break ---------------------------------------- 9 for the contracts." Id. at 12a. Thus, petitioner's fail- ure to make the required disclosures "directly im- plicate[d] the functions and duties of that official's public office," Rabbit, 583 F.2d at 1024, and "deprived the public * * * of some potential tangible gain such as favorable contracts, " id. at 1025. Petitioner's re- liance (Pet. 16) on United States v. McNeive, 536 F.2d 1245 (8th Cir. 1976), is similarly misplaced. In McNeive a plumbing inspector's acceptance of gratui- ties for the performance of his duties was held not to violate the mail fraud statute because the defendant "was not derelict in any of his affirmative duties as Chief Plumbing Inspector." Id. at 1252. Here, by contrast, petitioner breached his duty as a School Board member to disclose information suggesting the existence of substantial overpayments to a public con- tractor. Petitioner's claim therefore does not war- rant this Court's review. CONCLUSION The petition for a writ of certiorari should be denied. Respectfully submitted. DREW S. DAYS, III Solicitor General JOHN C. KEENEY Acting Assistant Attorney General RICHARD A. FRIEDMAN Attorney MARCH 1996 ---------------------------------------- Page Break ----------------------------------------