United States v. Hoover , 467 F.3d 496 ( 2006 )

United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
October 10, 2006
FOR THE FIFTH CIRCUIT
Charles R. Fulbruge III
)))))))))))))))))))))))))) Clerk
No. 05-30564
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UNITED STATES OF AMERICA
Plaintiff - Appellee
v.
GARY D. HOOVER
Defendant - Appellant
Appeal from the United States District Court
for the Western District of Louisiana, Monroe
No. 3:03-CR-30041-02
Before JOLLY, PRADO, and OWEN, Circuit Judges.
PRADO, Circuit Judge:
Defendant-appellant Gary D. Hoover appeals his conviction of
making a false statement to a federal agent in violation of 18
U.S.C. § 1001. In addition to attacking the sufficiency of his
indictment and the evidence supporting his conviction, Hoover
challenges the district court’s denial of his motion for
severance. He further argues that the district court
constructively amended his indictment, split a single count of
the indictment into two counts, and submitted a confusing verdict
form. Finally, Hoover argues that, even if none of these errors
alone warrants reversal, cumulatively, the errors require
reversal. For the reasons that follow, we REVERSE and REMAND for
further proceedings not inconsistent with this opinion.
I. BACKGROUND
On July 17, 2002, Special Agent Bill Chesser of the Federal
Bureau of Investigation (“FBI”) executed a search warrant at
Ruston Ford, a dealership in which the Hoover Group, a family
investment group that includes Gary Hoover, owned a ninety-
percent interest. After learning of the search from Ruston
Ford’s service manager, Hoover drove to the dealership to speak
with Agent Chesser. Hoover and Agent Chesser spoke for a few
minutes about the dealerships owned by the Hoover Group and
Hoover’s knowledge of, inter alia, “double floorplanning” or
“double flooring” of vehicles, an illegal practice whereby a
single vehicle is used as collateral for more than one loan.
According to Agent Chesser, when he asked Hoover about his
knowledge of double floorplanning, Hoover indicated that one
employee who had been fired for malfeasance, Steve Howard, had
made an allegation of double flooring at the dealership and that
Hoover considered it “sour grapes.” Agent Chesser testified that
the issue was addressed once more during the interview, and
Hoover said that Howard was the “one and only person who had
raised double floorplanning to him as a[n] issue of the
business.” This statement forms the basis for Hoover’s false
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statement conviction.1
The government charged Hoover, along with three others, in
an eight-count indictment. Hoover was implicated in count one,
conspiracy to commit bank fraud, and count seven, making false
statements to a federal agent. The alleged object of the
conspiracy was to “artificially inflate the balances of the
dealerships’ bank accounts” through bogus drafting, check kiting,
and double floorplanning. The indictment also alleged that
Hoover made two false statements in an effort to cover up the
conspiracy, one of which related to double floorplanning and the
other to the Hoover Group’s ownership interest in another car
dealership. The jury acquitted Hoover of the conspiracy charge
and the false statement relating to the ownership interest, but
found him guilty of making a false statement about double
floorplanning.
On appeal, Hoover attacks: (1) the sufficiency of the
indictment; (2) the district court’s jury instructions as an
unconstitutional constructive amendment of the indictment; (3)
the sufficiency of the evidence underlying his conviction; (4)
1
Mike McHale, the owner of a ten-percent interest in
Ruston Ford and general manager of the dealership, testified that
he, too, discussed double floorplanning with Hoover.
Additionally, William (Billy) Hulsey, a certified public
accountant who prepared tax returns for the dealership, testified
that he met with Hoover to discuss the issue. G.G. Grant, a
former Ruston Ford owner who still oversaw the dealership’s
finances, also testified that he told Hoover that the dealership
had a double floorplanning problem.
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the district court’s denial of his motion for severance; and (5)
the district court’s decision to split count seven into two
counts. Finally, Hoover argues that, even if none of these
errors alone warrants reversal, cumulatively, the errors require
reversal.
II. DISCUSSION
A. Sufficiency of the Indictment
As an initial matter, we address Hoover’s argument that
count seven of his indictment, making a false statement to a
federal agent in violation of 18 U.S.C. § 1001, is insufficient.
Count seven of the indictment alleged, inter alia, that Hoover
“did knowingly and willfully make fictitious and fraudulent
material statements and representations . . . during the course
of an interview being conducted by [Agent Chesser of the FBI]”
when Hoover “stated and represented that only one person had
complained of ‘double flooring’ of vehicles . . . when in truth
and in fact [Hoover], then and well knew that more than one
individual had told him about the ‘double flooring’ of vehicles
. . . .” Hoover claims that the indictment failed to allege a
false statement because more than one person could have “told”
him about the double flooring of vehicles at the car dealership
without “complaining” about it. In other words, Hoover maintains
that “complain” and “told” are not synonymous terms. Moreover,
Hoover argues that the indictment is defective because it alleged
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that the statement was material without adducing any facts or
circumstances to establish materiality.
This court generally reviews a challenge to the sufficiency
of the indictment de novo, but where, as here, the defendant
failed to object below, the appropriate standard of review is
plain error.2 See United States v. Partida, 385 F.3d 546, 554
(5th Cir. 2004); see also United States v. Cotton, 535 U.S. 625,
631 (2002) (applying the plain-error test to the defendant’s
claim that the indictment failed to allege drug quantity where
the defendant failed to object in the district court). “Under
that test, before an appellate court can correct an error not
raised at trial, there must be (1) error, (2) that is plain, and
(3) that affects substantial rights”–-i.e., the error affected
the outcome of the district court proceedings. Cotton, 535 U.S.
2
Although Hoover moved the district court for a bill of
particulars in order to seek more specific information from the
government concerning the false statement count of the
indictment, a bill of particulars cannot cure a deficient
indictment. We conclude, as did the Fourth Circuit, “that
seeking this remedy–-without objecting to the sufficiency of the
indictment–-does not preserve for review an alleged defect in the
indictment.” United States v. Quinn, 359 F.3d 666, 672 n.2 (4th
Cir. 2004) (reviewing sufficiency of the indictment challenge for
plain error where the defendants moved only for a bill of
particulars before the district court); cf. Russell v. United
States, 369 U.S. 749, 770 (1962) (“[I]t is a settled rule that a
bill of particulars cannot save an invalid indictment.”).
Likewise, Hoover’s post-verdict FED. R. CRIM. P. 34 motion
to arrest judgment does not preserve a sufficiency of the
indictment challenge. See United States v. Rodriguez, 360 F.3d
949, 958 (9th Cir. 2004) (reviewing claim of insufficiency of the
indictment raised for the first time in a Rule 34 motion for
plain error); see also United States v. Serag, No. 05-4927, 2006
WL 1525950, at *3 (4th Cir. May 30, 2006) (same).
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at 631-32 (internal quotation marks, alteration, and citations
omitted). “If all three conditions are met, an appellate court
may then exercise its discretion to notice a forfeited error, but
only if (4) the error seriously affects the fairness, integrity,
or public reputation of judicial proceedings.” Id. (internal
quotation marks, alteration, and citation omitted).
The basic purpose behind an indictment is to inform a
defendant of the charge against him. United States v.
Fitzgerald, 89 F.3d 218, 222 (5th Cir. 1996). As we recently
explained in United States v. Partida,
[t]o be sufficient, an indictment must conform to minimal
constitutional standards, standards that are met where
the indictment alleges every element of the crime charged
and in such a way as to enable the accused to prepare his
defense and to allow the accused to invoke the double
jeopardy clause in a subsequent proceeding.
385 F.3d at 554 (citing United States v. Bieganowski, 313 F.3d
264, 285 (5th Cir. 2002)).
Keeping these principles and the plain-error test in mind,
the allegation in count seven of the indictment satisfies the
minimal constitutional requirements. To violate § 1001, the
defendant must have: (1) made a statement; (2) that was false;
(3) and material; (4) knowingly and willfully; and (5) that falls
within agency jurisdiction. 18 U.S.C. § 1001(a); see also United
States v. Lange, 528 F.2d 1280, 1287 (5th Cir. 1976). Count
seven of the instant indictment alleged each element of § 1001
that the government was required to prove. In doing so, the
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indictment apprised Hoover of the charges against him, and it was
sufficiently specific for double jeopardy purposes. See United
States v. Crow, 164 F.3d 229, 235 (5th Cir. 1999).
We are not persuaded by Hoover’s argument that the
indictment failed to allege a false statement because
“complained” and “told” are not synonymous terms. Although the
terms are not generally thought of as synonyms, they can have the
same connotation in certain contexts. For example, both words
are listed as synonyms for “squeal,” meaning inform.3 The context
of words is important because no two words are directly
interchangeable.4 Here, the context of “complained” and “told”
involved statements concerning the illegal practice of double
flooring at the car dealership of which Hoover was an owner.
Telling or informing Hoover of such an illegal practice could
reasonably be characterized as making a complaint, especially
where, as here, the subject matter is an improper business
practice and the party being told is an owner of the business.
Hoover’s argument that “complain” is a subset of “tell,” rather
than a reasonable substitution, is overly technical, and we
decline to use that as the test for determining the sufficiency
3
See ROGET’S NEW MILLENNIUM THESAURUS, FIRST EDITION, available at
http://thesaurus.reference.com/browse/squeal (last visited Sept.
29, 2006).
4
See ROGET’S NEW MILLENNIUM THESAURUS, FIRST EDITION, available
at http://thesaurus.reference.com/features/howtousethesaurus.html
(last visited Sept. 29, 2006).
7
of his indictment. Cf. Crow, 164 F.3d at 235 (noting that “[t]he
validity of an indictment is governed by practical, not technical
considerations”).
Nor are we persuaded by Hoover’s argument that the
indictment is insufficient because it failed to include specific
facts and circumstances to establish materiality. Although the
indictment must allege the essential elements of the charged
offense, “‘[i]t is not necessary for an indictment to go further
and to allege in detail the factual proof that will be relied
upon to support the charges.’” United States v. Caldwell, 302
F.3d 399, 412 (5th Cir. 2002) (quoting United States v. Crippen,
579 F.2d 340, 342 (5th Cir. 1978)).
We therefore conclude that count seven of the indictment
sufficiently stated the falsity and materiality elements under
§ 1001 and provided Hoover with notice of the offense charged.
See United States v. Berrios-Centeno, 250 F.3d 294, 297 (5th Cir.
2001) (stating that “the core idea underlying an indictment is
notification”). We do note that this analysis is made under the
plain-error standard of review.
B. Constructive Amendment of the Indictment in the Jury
Instructions
Having determined that the indictment was sufficient under a
plainly erroneous standard, we next consider whether the district
court erred when it instructed the jury that it could convict
Hoover if it found that he “stated that only one person had
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complained of ‘double flooring’ of vehicles and that such
statement was intentionally false.” Hoover contends that by
replacing the “truth and in fact” clause of the indictment with a
generic intent instruction, the district court constructively
amended the indictment and, in turn, violated his Fifth Amendment
right to a grand jury indictment. See United States v. Rubio,
321 F.3d 517, 521 (5th Cir. 2003) (“A constructive amendment
violates the defendant’s right under the Fifth Amendment to a
grand jury indictment.”). Stated another way, Hoover argues that
while the indictment required the government to prove that he
knew his statement was false because “more than one individual
told him about the double flooring,” the court’s jury instruction
allowed the government to obtain a conviction if it proved he
knew his statement was false even if he knew it for some reason
other than that more than one individual had told him about the
double flooring of vehicles. Because Hoover objected at trial,
we review the court’s jury instructions for an abuse of
discretion. See United States v. Pankhurst, 118 F.3d 345, 350
(5th Cir. 1997).
“The Fifth Amendment provides for criminal prosecution only
on the basis of a grand jury indictment.” United States v.
Doucet, 994 F.2d 169, 172 (5th Cir. 1993); see U.S. CONST. amend.
V (“No person shall be held to answer for a capital, or otherwise
infamous crime, unless on a presentment or indictment of a Grand
Jury . . . .”). “It is a long-established principle of our
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criminal justice system that, after an indictment has been
returned, its charges may not be broadened through amendment
except by the grand jury itself.” United States v. Young, 730
F.2d 221, 223 (5th Cir. 1984). This court has held that “[a]n
implicit or constructive amendment . . . occurs when it permits
the defendant to be convicted upon a factual basis that
effectively modifies an essential element of the offense charged
or permits the government to convict the defendant on a
materially different theory or set of facts than that with which
she was charged.” United States v. Reasor, 418 F.3d 466, 475
(5th Cir. 2005).
This court has addressed constructive amendment issues on
numerous occasions. See, e.g., United States v. Chambers, 408
F.3d 237, 247 (5th Cir. 2005) (reversing a conviction for being a
felon in possession of ammunition, where the indictment charged
possession of whole ammunition “in or affecting commerce” and the
jury was allowed to convict based on the travel of component
parts, rather than the whole, of the ammunition in interstate
commerce); United States v. Adams, 778 F.2d 1117, 1123 (5th Cir.
1985) (reversing a conviction for making a false statement and
providing false identification in connection with the purchase of
a firearm, where the indictment charged Adams with using a false
name, but the jury was allowed to convict based on his use of a
false address). And, while this court has never addressed the
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issue in this case, the Third Circuit has. In United States v.
Crocker, the Third Circuit held that “when a grand jury has
specifically charged the manner in which testimony is untruthful,
permitting the government to prove that it is untruthful in an
entirely different manner amounts to a constructive amendment of
the indictment rather than a mere variance.” 568 F.2d 1049, 1060
(3d Cir. 1977). In that case, a radio disc jockey testified to a
grand jury that he had never received cash or merchandise from a
record company to play its records. However, a radio executive
later admitted paying the defendant to play his company’s new
song releases. The disc jockey was indicted for making the false
statements. The indictment alleged that “[t]he declarations of
the defendant . . . as set forth in [the indictment], were false
in that, during the years 1974 and 1975, Ellsworth
Groce . . . gave in excess of $10,000 in cash to the
defendant . . . to promote the musical records of the companies
referred to in [the indictment].” Id. at 1052. At trial, over
the timely objection of defense counsel, the government produced
a witness, Charles Bobbit, who testified that he had also given
the defendant money for playing specific records. Additionally,
the trial court instructed the jury that it could convict the
defendant if it concluded he testified falsely. On appeal, the
Third Circuit reversed the defendant’s judgment of conviction and
remanded for a new trial because the trial court permitted the
government to charge an entirely different factual basis for
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falsity, and, consequently, constructively amended the
defendant’s indictment. Id. at 1060. We agree with the Third
Circuit’s analysis in Crocker, as it is consistent with our prior
constructive amendment jurisprudence. See, e.g., Reasor, 418
F.3d at 475.
An essential element of an 18 U.S.C. § 1001 violation is
that the defendant knowingly make a false statement. See Lange,
528 F.2d at 1287. Hoover claims that the court’s charge
broadened the factual bases on which the government could prove
that he knowingly made a false statement. He contends that the
indictment required the government to prove that he knew his
statement was false because “more than one individual told him
about the double flooring”; whereas, the court’s jury instruction
allowed the government to obtain a conviction if it proved he
knew his statement was false, even if he knew it was false for
some reason other than that “more than one individual had told
him” about the double flooring personally. The government
counters by noting that § 1001 only requires that the government
prove that the defendant knowingly made a false statement, not
that the defendant knew what the true statement would have been.
Because the instruction did not modify any element of the
offense, the government contends that Hoover’s indictment was not
constructively amended.
In accordance with the Supreme Court’s decision in Stirone
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v. United States,5 when the government chooses to specifically
charge the manner in which the defendant’s statement is false,
the government should be required to prove that it is untruthful
for that reason. 361 U.S. at 219. To allow otherwise would
permit the jury to convict the defendant on a basis broader than
that charged in the grand jury’s indictment. Hoover may have
reasonably relied on the indictment and only prepared a defense
that only one person had told him about the double flooring of
vehicles, and, therefore, he did not knowingly make a false
statement. However, based on the trial court’s jury
instructions, the government could have sustained a conviction by
showing that Hoover knew that his statement was false for any
reason, rather than being limited to the reason provided in the
indictment. Importantly, under the language in the jury
instructions, the government only needed to prove that Hoover
knew that more than one person had complained about double
5
In Stirone v. United States, the defendant was indicted
for obstructing the interstate movement of sand in violation of
the Hobbs Act. 361 U.S. 212, 215-16 (1960). The district court,
however, instructed the jury that it could convict the defendant
if it found that he had obstructed an interstate shipment of sand
or steel. The Supreme Court reversed the defendant’s conviction
because it did not know whether the grand jury would have charged
the defendant with obstructing the shipment of steel. Id. at
219. Therefore, “it c[ould not] be said with certainty that with
a new basis for conviction added, [the defendant] was convicted
solely on the charge made in the indictment the grand jury
returned.” Id. at 217. Moreover, the Court stated that even
though the Hobbs Act does not require that an indictment specify
the type of interstate commerce burdened, a conviction must rest
on the charge specified in the indictment. Id. at 218.
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flooring, not that he knew that more than one person complained
to him. For instance, the government could have shown that one
person had told Hoover that two people had complained or that
Hoover read two separate complaints. Therefore, we conclude that
because the indictment charged Hoover with making one false
statement, and the jury instructions allowed the jury to convict
him for making a different false statement, the trial court
constructively amended Hoover’s indictment.
“Where the indictment has been constructively amended, by
prosecution evidence wholly outside the proper scope of the
indictment and/or by a jury charge authorizing a verdict of
guilty thereon, but there is evidence within the proper scope of
the indictment which supports the verdict, then the normal remedy
is to reverse for a new trial.” Chambers, 408 F.3d at 247 n.6;
see Doucet, 994 F.2d at 172 (“Constructive amendment requires
reversal of the conviction.”). Accordingly, we reverse Hoover’s
false statement conviction and remand for further proceedings not
inconsistent with this opinion.
Because we reverse and remand for further proceedings, we
need not reach Hoover’s other points of error.
III. CONCLUSION
For the foregoing reasons, we REVERSE and REMAND for further
proceedings not inconsistent with this opinion.
REVERSED and REMANDED.
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