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UNITED STATES DISTRICT COURT
UNITED STATES OF AMERICA
Criminal No. 97-0335 (RMU)
UNITED STATES OPPOSITION AND INCORPORATED
MEMORANDUM TO DEFENDANTS MOTION
TO DISMISS COUNTS 13-25 OF THE INDICTMENT
FOR FAILURE TO STATE AN OFFENSE
OFFICE OF INDEPENDENT COUNSEL
DONALD C. SMALTZ
In Re Alphonso Michael (Mike) Espy
103 Oronoco Street, Suite 200
Alexandria, Virginia 22314
Phone: (703) 706-0010
Fax: (703) 706-0076
TABLE OF CONTENTS
TABLE OF AUTHORITIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii
I. INTRODUCTION 1
THE GRATUITY STATUTE DOES NOT REQUIRE A NEXUS
III. CONCLUSION 12
TABLE OF AUTHORITIES Page No.
United States v. Alessio 528 F.2d 1079 (9th Cir. 1976) 10
United States v. Anderson, 509 F.2d 312 (D.C. Cir. 1974) 11
United States v. Anthony, 712 F.Supp. 112 (N.D. Ohio 1989) .6
United States v. Baird, 29 F.3d 647 (D.C. Cir. 1994) 8
United States v. Barash, 412 F.2d 26 (2d Cir. 1969) 10
United States v. Biaggi, 853 F.2d 89 (2d Cir. 1988) 6
*United States v. Brewster, 506 F.2d 62 (D.C. Cir. 1974) 2, 4, 6, 7, 8
United States v. Bustamante, 45 F.3d 933 (5th Cir.), cert. denied, 116 S.Ct. 473 (1995) 8, 9
*United States v. Campbell, 684 F.2d 141 (D.C. Cir. 1982) 2, 3 - 6
United States v. Deutsch, 451 F.2d 98 (2d Cir. 1971) 6
*United States v. Evans, 572 F.2d 455 (5th Cir. 1978) 7, 8, 10
United States v. Gorman, 807 F.2d 1299 (6th Cir. 1986), cert. denied, 108 S.Ct. 68 (1987) 10
United States v. Irwin, 354 F.2d 192 (2d Cir. 1965) 10
United States v. Mariano, 983 F.2d 1150 (1st Cir. 1993) 6
United States v. McDade, 827 F. Supp. 1153 (E.D. Pa. 1993), affd, 28 F.3d 283 (3rd Cir. 1994) 9
United States v. Niederberger, 580 F.2d 63 (3rd Cir.), cert. denied, 99 S.Ct. 567 (1978) 9, 10
United States v. Passman, 460 F.Supp. 912 (W.D. La. 1978) 6
*United States v. Secord, 726 F.Supp. 845 (D.D.C. 1989) 6, 7, 8
*United States v. Sun-Diamond Growers of California, 941 F.Supp. 1262 (D.D.C. 1996) 2, 12
18 U.S.C. § 201(a)(3) 11
18 U.S.C. § 201(c) 7, 9
18 U.S.C. § 201(c)(1)(A) 1, 2
18 U.S.C. §201(c)(1)(B) 1, 4
18 U.S.C. § 201(g) 7, 8
Campaign Contributions and Federal Bribery Law,
92 Harv. L. Rev. 451, 455 (1978) .5
This motion asks the court to dismiss every count of the Indictment brought under the gratuity statute on the ground that the statute supposedly requires the Government to pinpoint a specific, identified official act for which the gratuity was given. This is not the law. The statute by its terms only require that the gratuity be given for or because of any official act, and the Indictment more than adequately pleads this prerequisite.
I.THE GRATUITY STATUTE DOES NOT REQUIRE A NEXUS
I. BETWEEN THE GRATUITY AND A SPECIFIC OFFICIAL ACT
Defendant demands that this court rewrite the gratuity statute, 18 U.S.C. § 201(c)(1)(B), which requires that a gratuity be received for or because of any official act, to require instead that the government demonstrate a nexus between the gratuity and a specific identifiable official act. This result would run contrary to the decisions of every court that has considered the issue (including this one) and would defeat the Congressional purpose behind the statute.
Defendant correctly notes that United States v. Campbell, 684 F.2d 141 (D.C. Cir. 1982) and United States v. Brewster, 506 F.2d 62 (D.C. Cir. 1974), are the leading authorities in this circuit on the gratuities statute, but deliberately chooses to misread them. Neither required the Government to prove a nexus between the gratuity given and a specific official act, although Brewster did establish a heightened threshold of inquiry for campaign contributions to an elected official. (There must be more specific knowledge of a definite official act for which the contributor intends to compensate before an officials action crosses the line between guilt and innocence.) Id., 506 F.2d at 81.
Indeed, Campbell shows quite clearly that the statute does not require a nexus between the gratuity and a specific official act. The public official in Campbell was a judge who gave a moving company lenient treatment in the disposition of citations and who received assistance in moving his household furnishings from the same company. 684 F.2d at 144. The jury instructions there required the jury to find that the gratuity be given knowingly and willingly, and for or because of an official act. Id. at 150. Following conviction, Campbell argued (as defendant argues here) that the trial court erred in not requiring the jury to find that the gratuity was conferred with specific knowledge of a definite official action for which compensation was intended. Id. at 149. The Court of Appeals, however, rejected this argument, holding that under the statute it was sufficient for the jury to find that the giver of the gratuity was merely seeking or rewarding lenient treatment from the judge. Id. at 150.
Despite this clear holding, defendant insists that Campbell requires the Government to establish a nexus between the gratuity and a specific official act. (Memorandum in Support at pp. 5-6). It makes this argument through a circuitous (and totally inaccurate) reading of two footnotes to the decision. Specifically, footnote 13 states that cash payments to defendant allegedly began before he was a judge, at a time when he was an Assistant Corporation Counsel sympathetic to the trucking industry. Footnote 14 observes that the indictment alleges only overt acts by the defendant while he was a judge. It goes on to state and this is what defendant sees as the telling point that [i]t is not . . . clear which acts of [defendant] could have been the basis for . . . gratuities prior to 1973 [i.e., while he was Assistant Corporation Counsel], because sympathy to trucking interests does not constitute an official act. Id. at 149, n.14.
These footnotes do not undercut the square holding of the Campbell decision. They merely state that the record failed to show that an Assistant Corporation Counsel was, like a judge, in a position to perform official acts to benefit a trucking company. There was, in other words, no demonstration that the moving company had issues before the Assistant Corporation Counsel the way it did before the judge. In contrast, Campbell as a judge was able to give a trucking company lenient treatment, so that a gratuity could be found to be for or because of any official act even though no nexus between the gratuity and a specific official act could be shown.
As the Campbell decision specifically notes, this holding is entirely consistent with the Brewster decision. Brewster concerned campaign contributions to a Senator, and, as defendant is quick to point out, the court there held that, in those circumstances, [t]here must be more specific knowledge of a definite official act for which the contributor intends to compensate before an officials action crosses the line between guilt and innocence. 506 F.2d at 81. This means, defendant contends, that any prosecution under § 201(c)(1)(B) requires the Government to show a nexus between the gratuity and a specific official act.
The defendant in Campbell made precisely the same argument, and the Court of Appeals rejected it:
Based on [Brewster], appellants here urge that the trial court erred in not requiring the jury to find that the gratuity was conferred with specific knowledge of a definite official action for which compensation was intended.
. . . . . . . . . .
Appellants argument reveals a fundamental misconception of the gratuity statute and an overreading of Brewster. . . . The hard question in Brewster involved distinguishing illegal gratuities from innocent campaign contributions.
. . . . . . . . . .
We must therefore conclude that appellants have taken Brewster entirely out of context in suggesting that it was insufficient for the [giver of the gratuity] to seek or reward lenient treatment from Judge Campbell. . . . It was more than sufficient in this case for the trial court to require that the alleged gratuities be given and received knowingly and willingly, and for or because of an official act.
684 F.2d at 150.
The Campbell and Brewster decisions consequently compel the conclusion that the gratuity statute does not require the identification of a specific official act for which the gratuity is given or accepted. Likewise, the other authorities upon which defendant relies require that the gratuity be for an official act, but not necessarily for a specific, identified official act. See United States v. Mariano, 983 F.2d 1150, 1159 (1st Cir. 1993); United States v. Deutsch, 451 F.2d 98, 112 (2d Cir. 1971); United States v. Biaggi, 853 F.2d 89, 96-100 (2d Cir. 1988); United States v. Anthony, 712 F.Supp. 112, 116 (N.D. Ohio 1989); United States v. Passman, 460 F.Supp. 912, 915 (W.D. La. 1978).
Subsequent to Brewster and Campbell, this court in United States v. Secord, 726 F. Supp. 845 (D.D.C. 1989) confronted the same issue. In that case, General Secord was charged with giving gratuities, including money and a security system, to Lt. Col. Oliver North. The defense theory was that involvement by other high government officials would have made it less likely that General Secord would "thank" Colonel North by providing him with gratuities, since Colonel North would have been committed to the project anyway. In rejecting the defense's argument, the Court ruled that the focus of the statute is not on any particular transactions or dealings, 726 F. Supp. at 847 (emphasis added), and that what made the gratuities illegal was both the recipients official position and his ability to refer deals to the giver. Id. Here, likewise, the Indictment alleges that defendant as the Secretary of Agriculture held a position of authority that allowed him to perform official acts to the benefit of the gratuity donors.
Campbell, Brewster, and Secord are consistent with other circuit courts' interpretations of Section 201(c) to the effect that no nexus need be shown between the value conferred on the appointed official, and any particular act by that official. For example, in United States v. Evans, 572 F.2d 455 (5th Cir.), defendant, an official employed by the Department of Health, Education and Welfare, was convicted of accepting gratuities in the form of cash payments from a company engaged in the collection of delinquent student loans. On appeal, Evans sought reversal of his conviction on the ground that the government failed to prove that the money and compensation were received for an actual official act. Id. at 479.
The Court flatly rejected this argument that it was not necessary that the official actually engage in identifiable conduct or misconduct, nor that any specific quid pro quo be contemplated by the parties nor even that the official actually be capable of providing some official act as quid pro quo at the time. Id. Respecting the donee's intent in accepting the gratuity, the Court explained:
[U]nder the unlawful gratuity subsection all that need be proven is that the official accepted, because of his position, a thing of value otherwise than as provided by law for the proper discharge of official duty. . . . Thus, Section 201(g) makes it criminal for a public official to accept a thing of value to which he is not lawfully entitled, regardless of the intent of the donor or donee.
Id. at 480 (citation and quotations omitted; emphasis added).
More recently, in United States v. Bustamante, 45 F.3d 933, 940 (5th Cir.), cert. denied, 116 S.Ct. 473 (1995), the Fifth Circuit upheld the conviction of a member of Congress for accepting an illegal gratuity from a broadcasting company. Citing Secord with approval, the Bustamante Court explained the requirements of a gratuity prosecution as follows:
To find a public official guilty of accepting an illegal gratuity, a jury must find that the official accepted, because of his position, a thing of value otherwise than provided by law for the proper discharge of official duty. Evans, 572 F.2d at 480. Generally, no proof of a quid pro quo is required; it is sufficient for the government to show that the defendant was given the gratuity simply because he held public office. Id. at 479; United States v. Secord, 726 F. Supp. 845, 847 (D.D.C. 1989) (sufficient for government to show that gratuity was given simply because of [a person's] official position, in appreciation of their relationship, or in anticipation of its continuation). In addition, the jury need not find that the official accepted the gratuity with the intent to be influenced. The jury must only conclude that the evidence establishes beyond a reasonable doubt that the official accepted unauthorized compensation. Evans, 572 F.2d at 480.
Bustamante, 45 F.3d at 940 (emphasis added).
The Bustamante court then concluded that the jury was entitled to find that Bustamante received the gratuity because of his status as a Congressman since he was asked to participate in the investment relating to the license after his election was assured, and he brought no broadcasting experience, financial support, or minority benefit to the enterprise. Id. at 941; see United States v. McDade, 827 F. Supp. 1153 (E.D. Pa. 1993), affd, 28 F.3d 283 (3d Cir. 1994).
Every circuit that has considered the issue has allowed gratuities prosecutions to proceed without the identification of a specific official act for which the gratuity was given. See, for example, United States v. Niederberger, 580 F.2d 63 (3d Cir.), cert. denied, 99 S.Ct. 567 (1978):
[W]e find it unnecessary for the Government to allege in an indictment charging a [§ 201(c)] offense that a gratuity received by a public official was, in any way, generated by some specific, identifiable act performed or to be performed by the official. A quid pro quo is simply foreign to the elements of a subsection [(c)] offense. What is proscribed, simply put, is a public officials receipt of a gratuity, to which he was not legally entitled, given to him in the course of his everyday activities, for or because of any official act performed or to be performed by such public official, and he was in a position to use his authority in a manner which could affect the gift-giver.
Id. at 68-69. See also United States v. Alessio 528 F.2d 1079 (9th Cir. 1976) (offense found where son of prisoner gave gratuities to prison administrator, but particular beneficial acts toward prisoner not specified); United States v. Barash, 412 F.2d 26, 29 (2d Cir. 1969) (offense can be found for gifts to IRS agents where intent was to create a better working environment or show appreciation for a speedy audit.) As the Court observed in United States v. Gorman, 807 F.2d 1299, 1304 (6th Cir. 1986), cert. denied 108 S.Ct. 68 (1987), the purpose of the [gratuity statute] is to reach all situations in which a government agent's judgment concerning his official duties may be clouded by the receipt of an item of value given to him by reason of his position. In other words, [e]ven if corruption is not intended by the donor or the donee, there is still a tendency in such a situation to provide conscious or unconscious preferential treatment of the donor by the donee, or the inefficient management of public affairs. Evans, 572 F.2d at 480. Accord, United States v. Irwin, 354 F.2d 192, 196 (2d Cir. 1965).
Defendants narrow reading of the statute, which would criminalize gratuities given for specific official acts but not for general official acts, runs counter to the plain meaning of the words Congress chose in enacting the statute: The statute speaks not of definite, identifiable official acts, but of any official act performed or to be performed, where an official act is defined as any decision or action . . . which may at any time be pending, or which may by law be brought before any public official. 18 U.S.C. § 201(a)(3). Under the statute a gratuity would be, and should be, no less illegal simply because the official acts that might affect the donor cannot be identified with specificity.
Defendants reading of the statute also defies the Congressional purpose behind the statute. The D.C. Circuit court noted that purpose in United States v. Anderson, 509 F.2d 312 (D.C. Cir. 1974) (the companion case to Brewster):
Congress has decided that bribery and kindred practices imperil the very nature of democratic government. It has legislated a vigorous attack on those practices.
509 F.2d at 333 (holding that separate bribes merit separate sentences). The court should not now retreat from that characterization to indulge defendants position that a gratuity given for official acts in general is somehow less offensive to public integrity than a gratuity given for a specific official act.
Finally, in the related case United States v. Sun-Diamond Growers of California, 941 F.Supp. 1262 (D.D.C. 1996), which concerned many of the same gratuities that are at issue here, this Court correctly recognized that the gratuities statute does not require the government to identify a nexus between the gratuity and a specific identifiable official act. Defendant stridently urges the Court to undo that decision, but, as the foregoing discussion makes obvious, it correctly stated the law.
The indictment alleges that defendant sought, solicited, received, and accepted gifts, gratuities, and things of value from corporations and individuals seeking official action by, doing or seeking to do business with, and conducting activities regulated by USDA. (Indictment at ¶ 7). Defendant was the senior official in charge of the USDA. (Id. at ¶ 2). Nothing more is required to show that the gratuities defendant received were for or because of any official act performed or to be performed by defendant.
The law requires that a gratuity be given for or because of any official act, and the Indictment more than adequately alleges this element. There is no requirement, as defendant would have it, that the Government allege a nexus between the gratuities and a specific identified official act. The motion to dismiss should accordingly be denied.
Dated: November 20, 1997 Respectfully submitted,
OFFICE OF INDEPENDENT COUNSEL
In Re Alphonso Michael (Mike) Espy
Donald C. Smaltz, Independent Counsel
William F. Fahey
Roscoe C. Howard
Charles M. Kagay
Adrienne R. Baron
103 Oronoco Street, Suite 200
Alexandria, Virginia 22314
Phone: (703) 706-0010
Fax: (703) 706-0076
18 U.S.C. § 201(c)(1)(B) specifically provides:
Whoever -- being a public official, former public official, or person
selected to be a public official, otherwise than as provided by law for the
proper discharge of official duty, directly or indirectly demands, seeks,
receives, accepts, or agrees to receive or accept anything of value personally
for or because of any official act performed or to be performed by such
official or person -- shall be fined under this title,...
Section 201(c)(1)(B), as distinguished from Section 201(c)(1)(A), of Title 18 focuses on the receiver of illegal gratuities. 18 U.S.C. § 201(c)(1)(A), as in the case of United States v. Sun-Diamond Growers of California, 941 F.Supp. 1262 (D.D.C. 1996), relates to instances where illegal gratuities are given to a public official. Section 201(c)(1)(A) provides:
Whoever -- directly or indirectly gives, offers, or promises anything of
value to any public official, former public official, or person selected to
be a public official, for or because of any official act performed or to be
performed by such public official, former public official, or person
selected to be a public official -- shall be fined under this title,...
The different implications resulting when a charged gratuity is also a campaign contribution were examined in Campaign Contributions and Federal Bribery Law, 92 Harv. L. Rev. 451, 455 (1978) (footnote omitted):
As applied to nonelected officials, the bribery and gratuity standards conform to logical inferences about what constitutes corrupt conduct. Such officials properly receive their sole compensation from the government as provided by law; they run no campaigns that require additional funds. Any money they receive from other parties is, therefore, suspect. Under the gratuity provisions, this absence of a legitimate use justifies a standard close to strict liability for acceptance of payment by nonelected officials.
It is noteworthy that in United States v. Baird, 29 F.3d 647, 652 (D.C. Cir. 1994), the D.C. Circuit quoted with approval the holding of Evans, upon which the district court in Secord relied, that [t]he gravamen of each offense [gratuity and conflict of interest], then, is not an intent to be corrupted or influenced, but simply the acceptance of an unauthorized compensation.
Although this case involved an elected official, the gratuities were not campaign contributions. Bustamante is thus consistent with Brewster, which requires a heightened nexus between the gifts and the official acts for campaign contributions to elected officials.