United States v. Lawrence Shaw , 885 F.3d 1217 ( 2018 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, No. 13-50136
Plaintiff-Appellee,
D.C. No.
v. 2:12-cr-00862-JFW-1
LAWRENCE EUGENE SHAW,
Defendant-Appellant. OPINION
On Remand from the United States Supreme Court
Filed March 27, 2018
Before: Mary M. Schroeder, Jacqueline H. Nguyen,
and Andrew D. Hurwitz*, Circuit Judges.
Opinion by Judge Mary M. Schroeder
*
This case was submitted to a panel that included Judge Pregerson,
who recently passed away. Following the passing of Judge Pregerson,
Judge Hurwitz was drawn by lot to replace him. Ninth Circuit General
Order 3.2.h. Judge Hurwitz has read the briefs and reviewed the record.
2 UNITED STATES V. SHAW
SUMMARY**
Criminal Law
On remand from the Supreme Court, the panel affirmed
a conviction for bank fraud.
The panel held that the defendant did not fairly present to
this court, or to the district court, his challenge to the
disjunctive form of the district court’s jury instruction that a
“scheme to defraud” within the meaning of 18 U.S.C.
§ 1344(1) means a defendant must intend to “deceive, cheat
or deprive” the bank of something of value. The panel held
that even if the defendant had preserved the objection, any
error was harmless.
COUNSEL
James H. Locklin, Deputy Federal Public Defender; Hilary L.
Potashner, Federal Public Defender; Federal Public
Defender’s Office, Los Angeles, California; for Defendant-
Appellant.
Elana Shavit Artson, Assistant United States Attorney; Tracy
L. Wilkison, Executive Assistant United States Attorney;
Lawrence S. Middleton, Chief, Criminal Division; Sandra R.
Brown, United States Attorney; United States Attorney’s
Office, Los Angeles, California; for Plaintiff-Appellee.
**
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
UNITED STATES V. SHAW 3
OPINION
SCHROEDER, Circuit Judge:
This case, involving a conviction for bank fraud in
violation of 18 U.S.C. § 1344(1), is before us on remand from
the Supreme Court. See Shaw v. United States, 137 S. Ct. 462
(2016). Shaw had created a scheme to siphon off the funds in
the account of a bank depositor, Stanley Hsu, through the use
of an online payment and money transfer service, PayPal.
The losses were eventually borne by Hsu and PayPal, not the
bank, prompting Shaw to argue that he had not defrauded the
bank within the meaning of the statute. See id. at 466.
We affirmed the conviction, and the Supreme Court
agreed that a fraudulent scheme to obtain money in a
depositor’s account violates the statute. The Court also
rejected the defendant’s theory that the government must
show that the bank itself suffered a financial loss or that the
defendant intended the bank to suffer a financial loss. See id.
at 466–68. We had reached the same conclusion. See United
States v. Shaw, 781 F.3d 1130, 1135–36 (9th Cir. 2015).
The Supreme Court remanded the case, however, on an
issue we had not considered. In the Supreme Court, Shaw
challenged the disjunctive form of the district court’s
instruction to the jury that a “scheme to defraud” within the
meaning of the statute means a defendant must intend to
“deceive, cheat or deprive” the bank of something of value.
Shaw, 137 S. Ct. at 469. The parties agreed in the Supreme
Court that a conviction under subsection (1) requires both a
scheme “to deceive the bank and deprive it of something of
value.” Id. Shaw argued in the Supreme Court that because
the instruction was in the disjunctive, the jury was allowed to
4 UNITED STATES V. SHAW
convict if it found the defendant intended only to deceive the
bank and not to deprive it of something of value. Id. The
Court remanded to us to consider whether this argument was
fairly presented below, “and, if so, whether the instruction is
lawful, and, if not, whether any error was harmless in this
case.” Id. at 470.
We called for supplemental briefs. Not surprisingly,
Shaw contends he preserved such an instructional error
argument in the district court and to us, and the government
maintains he did not.
We have carefully reviewed the record. It shows that
Shaw did object to the instruction given by the district court.
But the objection was not on the ground he urged in the
Supreme Court—that the instruction allowed the jury to
convict if it found only an intent to deceive the bank without
regard to an intent to deprive it of something of value.
Rather, Shaw argued in the district court and on appeal to us
that the instruction erroneously allowed the jury to convict for
stealing Hsu’s money, not the bank’s. This was consistent
with the position Shaw advanced all the way to the Supreme
Court—that the government had to prove an intent to cheat
the bank and not the depositor. As the Supreme Court has
now clarified, an intent to obtain money from a depositor’s
bank account is sufficient to constitute bank fraud under
18 U.S.C. § 1344(1). It is not necessary to show an intent to
cause the bank itself a financial loss. See id. at 467.
Accordingly we conclude that the argument the Supreme
Court identified for consideration on remand was not fairly
presented to us or to the district court. Shaw’s argument was
one of statutory interpretation that was creative and consistent
with the record: that he did not violate the bank fraud statute
UNITED STATES V. SHAW 5
because he was after Hsu’s money. He did not object to the
instruction on the ground it was in the disjunctive.
Moreover, even if Shaw had preserved the objection to
the instruction, any error was harmless. See United States v.
Gracidas-Ulibarry, 231 F.3d 1188, 1197 (9th Cir. 2000) (en
banc) (holding that an instructional error is harmless if “it is
‘clear beyond a reasonable doubt that a rational jury would
have found the defendant guilty absent the error.’”) (quoting
Neder v. United States, 527 U.S. 1, 18 (1999)). The evidence
was overwhelming that Shaw deceived the bank in order to
obtain money from Hsu’s bank account, and that he
transferred the money from Hsu’s account into accounts
Shaw controlled. There was thus no reasonable possibility
the jury could have convicted him on the basis of a deception
alone, without the intent to obtain anything of value. Any
error in the instruction was therefore harmless. Shaw would
have been convicted whether the instruction was in the
disjunctive or conjunctive.
The judgment of conviction is again AFFIRMED.