United States v. Ashley Andrews

PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
______
No. 11-1239
______
UNITED STATES OF AMERICA
v.
ASHLEY ANDREWS,
Appellant
______
On Appeal from the District Court
of the Virgin Islands – Appellate Division
Division of St. Thomas
(D.C. No. 3-04-cr-00038-002)
District Judge: Honorable Juan R. Sánchez
______
Argued December 5, 2011
Before: FISHER, GREENAWAY, JR.
and ROTH, Circuit Judges.
(Filed: June 4, 2012)
Denise M. Francois (Argued)
Hodge & Francois
1340 Taarneberg
St. Thomas, VI 00802
Counsel for Appellant
Kim L. Chisholm
Office of United States Attorney
5500 Veterans Building, Suite 260
United States Courthouse
Charlotte Amalie, St. Thomas, VI 00802-6924
Paul A. Murphy (Argued)
Office of United States Attorney
1108 King Street, Suite 201
Christiansted, VI 00820
______
OPINION OF THE COURT
______
FISHER, Circuit Judge.
Ashley Andrews (“Andrews”) was convicted of one
count of conspiracy, in violation of 18 U.S.C. § 371, four
counts of wire fraud, in violation of 18 U.S.C. §§ 1343, 1346,
and 2, one count of program fraud, in violation of 18 U.S.C.
§§ 666(a)(1)(B) and 2, one count of making a false claim
2
upon the Government of the Virgin Islands, in violation of 14
V.I.C. § 843(4), and one count of inducing a conflict of
interest, in violation of 3 V.I.C. §§ 1102, 1103, and 1107.
Andrews appeals his judgment of conviction and sentence.
For the reasons set forth below, we will affirm the judgment
of conviction, vacate the judgment of sentence on Counts One
through Six, and remand to the District Court for
resentencing.
I.
In 1985, the Government of the Virgin Islands (“GVI”)
and the United States entered into a consent decree in the
District Court of the Virgin Islands, pursuant to which the
GVI was to make improvements to its sewage system. For
over fifteen years, the GVI failed to make the necessary
repairs. In October 2001, the District Court held a hearing,
requiring the GVI to show cause why it should not be held in
contempt for failure to comply with the consent decree.
Around this time, Ohanio Harris (“Harris”), who, in his
capacity as Special Assistant to the Governor of the Virgin
Islands, was responsible for handling issues regarding the
sewage system, began to promote Andrews as a contractor
who could repair the sewage system. Andrews had created a
construction company called Global Resources Management
(“GRM”) in 2001. GRM, however, could not obtain the
sewer repair contract without a Virgin Islands business
license. Because a “tax clearance” letter was required before
such a license could be issued, and Andrews could not obtain
a “tax clearance” letter on his own, when GRM applied for
the license in late February 2002, Harris was listed as the
president of GRM on the application. Prior to February 2002,
3
Andrews had served as president of GRM, and on or about
March 8, 2002, Andrews again replaced Harris as president of
GRM.
On March 1, 2002, Harris and Andrews traveled to
Tortola, British Virgin Islands to meet with representatives of
the Berger Group, an American engineering firm. At this
meeting, Harris, who was introduced as the Special Assistant
to the Governor, vouched for Andrews, stating that Andrews
had organized local contractors to work as subcontractors for
large firms. Harris also indicated that he could arrange a
meeting with the Governor to discuss awarding the sewage
system contract to the Berger Group. Harris testified that
after this meeting, he and Andrews went to a hotel, and
Andrews paid him $2,500 in cash. The payment, Harris
explained, was “for what [he] ha[d] done for [Andrews].”
Harris deposited the check into his bank account and then
used the money to make a mortgage payment on his home.
Around this time, Harris began to hold himself out as a
liaison between GRM and Andrews, and the Virgin Islands
Department of Public Works (“DPW”). Harris arranged a
meeting between the Governor and Andrews to discuss the
sewer repair work. After this meeting, Andrews asked Harris
to help him get the contract, and Harris replied that he would
“see what [he] c[ould] do.” Harris testified that in exchange
for his assistance in obtaining the contract, Andrews agreed
that he would hire Harris to work at GRM after Harris retired
from government service. On March 24, 2002, Harris again
traveled to Tortola to meet with Andrews and representatives
from the Berger Group. Harris testified that he told Andrews
that he expected to be compensated for whatever assistance
4
he provided, and Andrews assured him that he would be paid.
Harris subsequently set up additional meetings between
Andrews, the Governor, and other GVI officials. At some
point, GRM submitted a $3.6 million bid for the sewer repair
work. The Governor testified that Harris told him “that
[GRM] was a company that we should look at and see if they
can do the job.” The sewage system repair contract was not
advertised, and there were no other contractors bidding for
the project, despite the fact that, even in emergency
situations, there were generally three bidders. Wayne
Callwood (“Callwood”), the Commissioner of DPW, testified
that “[b]asically, this project was sole-sourced to GRM.”
The GVI tentatively accepted GRM’s bid in October
2002, on the condition that GRM procured a performance
bond and a payment bond, each for 100 percent of the
contract price ($3.6 million). On October 7, Campbell
Malone (“Malone”), a Certified Public Accountant acting on
behalf of GRM, contacted Alan Feuerstein (“Feuerstein”), a
New York attorney, for assistance in obtaining the bonds.
Feuerstein put Malone in touch with Wayne Price (“Price”), a
surety bond manager at Melwain Enterprises, in Long Island,
New York. On October 10, Price faxed Malone, who was in
the Virgin Islands, a collection of bond application
paperwork. Price sent additional bond-related paperwork to
Malone on October 11 (fax) and October 17 (email).
On October 18, Malone emailed Price a completed
bond application package, which was signed by Andrews.
This application contained numerous false representations,
including statements that: (1) Andrews was divorced;
(2) Andrews owned a home valued at $720,000, when, in
5
fact, his daughters owned the home; (3) Andrews had a one-
third interest in a $150,000 property located at 113 Estate
Grove Place, St. Croix; (4) Andrews had $7,000 in cash on
deposit at the Banco Popular as of September 30, 2002; and
(5) Andrews had stock in GRM worth $600,000. In the
“work on hand” section of the application, which asked for a
list of all of the contracts that GRM had secured but not yet
completed, Malone and Andrews listed the following five
“contracts” worth a total of $26 million: (1) a professional
services contract worth $1.5 million; (2) a contract with the
GVI for sewage system repair in the amount of $7.5 million,
twice the price of the actual contract; (3) a construction
management services contract for Peebles Hospital in the
British Virgin Islands valued at $1 million; (4) a development
contract worth $12 million; and (5) “work on hand” for
processing municipal garbage. At trial, the Government
proved that none of these contracts had been obtained.
Additionally, the bond application falsely stated that:
(1) GRM and its owners were not involved in any litigation,
whereas Andrews was in the midst of a lawsuit related to
another company that he owned; (2) GRM had a $350,000
“investment” in an affiliate, which in reality was worthless;
and (3) that Robert Jarnis was a director of GRM, when he
actually worked for the Berger Group in Massachusetts.
GRM had difficulty obtaining the bonds without a
construction contract signed by the Governor. Accordingly,
the Virgin Islands Attorney General advised the Governor to
sign the contract, on the condition that no Notice to Proceed
would be issued by the Department of Property and
Procurement (“P&P”) until GRM successfully obtained the
6
bonds. The Governor signed the sewer system repair contract
on December 20, 2002.
On January 23, 2003, the United States filed a motion
to enjoin the enforcement of the contract. On January 28,
before GRM was able to obtain the required bonds and before
any Notice to Proceed was issued, the Governor terminated
the contract. The GVI subsequently asked the District Court
to remove the injunction, but the District Court refused, and
enjoined the GVI from re-contracting with GRM. United
States v. Gov’t of Virgin Islands, 248 F. Supp. 2d 420 (D.V.I.
2003), affirmed in part and vacated in part by United States
v. Gov’t of Virgin Islands, 363 F.3d 276 (3d Cir. 2004).
On June 12, 2003, Andrews submitted to the GVI a
$748,304.92 post-termination claim, seeking payment for the
time and resources GRM had expended preparing its bid.
This claim included numerous false statements and duplicate
charges. Moreover, as evidence adduced at trial established,
Andrews’s entire scheme was fraudulent. Callwood testified
that “to the best of [his] knowledge, [GRM was not] capable
of doing construction work.”
Andrews, Harris, and Malone were indicted on
February 20, 2004. The grand jury returned a Second
Superseding Indictment (“Second Superseding Indictment” or
“Indictment”) on June 10, 2004, which charged Andrews with
one count of conspiracy, in violation of 18 U.S.C. § 371(Count One), four counts of wire fraud, in violation of 18
U.S.C. §§ 1343, 1346, and 2 (Counts Two through Five), one
count of program fraud, in violation of 18 U.S.C.
§§ 666(a)(1)(B) and 2 (Count Six), one count of fraudulent
7
claims upon the Government of the Virgin Islands, in
violation of 14 V.I.C. § 843(4) (Count Seven), and one count
of inducing a conflict of interest, in violation of 3 V.I.C.
§§ 1102, 1103, and 1107 (Count Eight). Harris pled guilty,
and Malone and Andrews went to trial. They were initially
tried on the charges in the Second Superseding Indictment in
May 2006, but the jury was unable to reach a verdict. They
were re-tried beginning in August 2006, and on September
20, 2006, the jury convicted Andrews on all charges. On
January 19, 2011, the District Court sentenced Andrews to
151 months’ imprisonment on Counts One through Six, to be
followed by three years of supervised release. 1 The District
Court also imposed a $17,500 fine. The District Court
sentenced Andrews to two years’ imprisonment on Counts
Seven and Eight, to be served concurrently with the sentence
on Counts One through Six. Andrews filed a timely notice of
appeal. 2
1
It is not clear from the record why nearly five years
passed between Andrews’s conviction and the imposition of
his sentence.
2
Andrews first filed his notice of appeal on January
26, 2011, but the District Court did not enter a written
judgment until March 3, 2011. Pursuant to Federal Rule of
Appellate Procedure 4(b)(2), we treat the notice of appeal as
filed on the date that the District Court entered its judgment.
8
On appeal, Andrews raises three arguments. First, he
argues that after the Supreme Court’s decision in Skilling v.
United States, 130 S. Ct. 2896 (2010), the District Court’s
instruction to the jury on honest services fraud under 18
U.S.C. § 1346 was erroneous, and prejudice from the error
spilled over to the other charges against him. Second, he
contends that the evidence was insufficient to sustain his
convictions for wire fraud (Counts Two through Five),
program fraud (Count Six), and inducing a conflict of interest
(Count Eight). Finally, Andrews maintains that the District
Court improperly instructed the jury on Count Seven. 3
In April 2011, Andrews filed a motion for release
pending appeal, in which he argued that his appeal raised
several substantial questions of law, likely to result in reversal
of his conviction, a new trial, a noncustodial sentence, or a
shorter term of imprisonment. On September 6, 2011, the
District Court denied his motion. United States v. Andrews,
No. 04-38-2, 2011 WL 3903229, at *5 (D.V.I. Sept. 6, 2011).
3
The Government noted in its brief that the District
Court erred in imposing a “general sentence” of 151 months’
imprisonment on Counts One through Six. Andrews did not
properly raise this issue in his opening brief, and ordinarily
we would consider it waived. United States v. Albertson, 645
F.3d 191, 195 (3d Cir. 2005); see Fed. R. App. P. 28(a)(5);
Third Circuit L.A.P. 28.1(a)(1). However, because we
believe that this case presents “extraordinary circumstances,”
we will consider the legality of the sentence imposed by the
District Court. See Albertson, 645 F.3d at 195.
9
II.
The District Court had jurisdiction under 48 U.S.C.
§ 1612 and 18 U.S.C. § 3231, and we have appellate
jurisdiction pursuant to 28 U.S.C. § 1291. Where there were
no legal grounds for challenging an instruction at the time it
was given, but such grounds have arisen, due to the
articulation of a new rule of law between the time of
conviction and the time of appeal, we review for plain error.
Johnson v. United States, 520 U.S. 461, 464-68 (1997);
United States v. West Indies Transp., Inc., 127 F.3d 299, 305
(3d Cir. 1997). Accordingly, we review Andrews’s challenge
to the honest services fraud portion of the jury instructions for
plain error. United States v. Riley, 621 F.3d 312, 321-22 (3d
10
Cir. 2010). 4 We also review his challenge to the jury
instruction on Count Seven for plain error. Under plain error
review, we may correct an error not raised at trial only if the
appellant demonstrates that: (1) there was an error; (2) the
error is clear or obvious; and (3) “the error ‘affected the
appellant’s substantial rights, which in the ordinary case
means’ it ‘affected the outcome of the district court
proceedings.’” Id. at 322 (quoting United States v. Marcus,
130 S. Ct. 2159, 2164 (2010)). “If all three conditions are
met, an appellate court may then exercise its discretion to
4
The Government argues that Andrews waived his
right to challenge the jury instructions on appeal because his
attorney objected to the initial instruction and persuaded the
District Court to provide a clarifying instruction. Under the
“invited error” doctrine, where a defendant makes a request in
favor of certain instructions, he waives the right to complain
of error in such instructions on appeal. United States v.
Ozcelik, 527 F.3d 88, 97 n.6 (3d Cir. 2008); United States v.
Console, 13 F.3d 641, 660 (3d Cir. 1993). However, we have
previously held that “[w]here a defendant submits proposed
jury instructions in reliance on current law” and while his
case is on direct appeal, the law is found to be constitutionally
problematic, we will not apply the “invited error” doctrine.
United States v. West Indies Transp., Inc., 127 F.3d 299, 305
(3d Cir. 1997). Instead, we review for plain error. Id. This is
consistent with the Supreme Court’s definition of waiver as
the “intentional relinquishment or abandonment of a known
right.” United States v. Olano, 507 U.S. 725, 733 (1993)
(emphasis added) (citations omitted).
11
notice a forfeited error, but only if . . . the error seriously
affect[s] the fairness, integrity, or public reputation of the
judicial proceedings.” Johnson, 520 U.S. at 467 (internal
marks and citations omitted). Andrews bears the burden of
showing that the error affected his substantial rights. United
States v. Olano, 507 U.S. 725, 734 (1993).
“In reviewing a challenge to the sufficiency of the
evidence, we apply a particularly deferential standard of
review.” United States v. Reyeros, 537 F.3d 270, 277 (3d Cir.
2008) (internal marks and citations omitted). We must “view
the evidence in the light most favorable to the Government
and sustain the verdict if any rational juror could have found
the elements of the crime beyond a reasonable doubt.” Id.(internal marks and citation omitted).
III.
A.
Andrews first contends that references to honest
services fraud in the Second Superseding Indictment and in
the District Court’s instructions to the jury constituted
reversible error. We disagree. As we explain below,
although Skilling rendered the jury instructions improper, the
error did not affect Andrews’s substantial rights, and thus
does not require reversal.
To prove wire fraud, the Government must establish
“(1) the defendant’s knowing and willful participation in a
scheme or artifice to defraud, (2) with the specific intent to
defraud, and (3) the use of . . . interstate wire communications
12
in furtherance of the scheme.” United States v. Antico, 275
F.3d 245, 261 (3d Cir. 2001) (citation omitted), abrogated on
other grounds by Skilling v. United States, 130 S. Ct. 2896(2010). Under 18 U.S.C. § 1346, “the term ‘scheme or
artifice to defraud’ includes a scheme or artifice to deprive
another of the intangible right of honest services.” In
Skilling, the Supreme Court considered the scope and
constitutionality of § 1346, and held that the statute
criminalizes only “fraudulent schemes to deprive another of
honest services through bribes or kickbacks.” 130 S. Ct. at
2928, 2931. The Court rejected an argument by the
government that § 1346 also covers “undisclosed self-dealing
by a public official . . . [such as] the taking of official action
by the [official] that furthers his own undisclosed financial
interests while purporting to act in the interests of those to
whom he owes a fiduciary duty.” Id. at 2932. Such an
interpretation, the Court explained, would render the statute
unconstitutionally vague. Id. at 2931. Accordingly, a district
court’s failure to limit honest services fraud to schemes
involving bribes or kickbacks now constitutes legal error.
Riley, 621 F.3d at 323. 5
5
Although Skilling v. United States, 130 S. Ct. 2896(2010), was decided after Andrews’s trial and thus was
unavailable to the District Court, we apply it retroactively.
United States v. Riley, 621 F.3d 312, 320 n.9 (3d Cir. 2010);
see Griffith v. Kentucky, 479 U.S. 314, 328 (1987) (“[A] new
rule for the conduct of criminal prosecutions is to be applied
retroactively to all cases, state or federal, pending on direct
review or not yet final, with no exception for cases in which
13
1.
The first step in our plain error analysis requires us to
determine whether references to honest services fraud in the
Indictment and in the District Court’s instructions constituted
Skilling error. 6 The Government concedes that the original
version of the Indictment explicitly charged Andrews with
honest services fraud. The conspiracy count (Count One)
alleged that Andrews “knowingly devise[d] a scheme and
artifice to defraud and for obtaining money and property and
to deprive another of the intangible right of honest services.”
The wire fraud counts (Counts Two through Five) alleged that
Andrews “deprive[d] another of the intangible right of honest
services” and “defraud[ed] the Virgin Islands government and
its residents of honest services.” The Government pursued
both theories at trial, and in his closing argument, the
prosecutor explained that the Government’s “alternative
theory [was that] the scheme and artifice to defraud included
the deprival of the Government and the people of the Virgin
Islands of the honest services of Ohanio Harris.”
However, the Government emphasizes that the
Indictment was redacted before the jury was charged, and all
references to “honest services” in the wire fraud counts were
the new rule constitutes a ‘clear break’ with the past.”).
6
Because Andrews was tried and convicted before
Skilling, there is no dispute that no instruction was given
limiting 18 U.S.C. § 1346 to bribes and kickbacks.
14
removed. 7 The Government further notes that the District
Court charged the jury consistent with the redacted version of
the Indictment; in explaining the elements of wire fraud to the
jury, the District Court did not mention “honest services,” and
stated that the first element of the wire fraud counts required
proof “[t]hat the defendant knowingly devised or participated
in a scheme to defraud, or to obtain money or property by
materially false or fraudulent pretenses, representations,
promises or omissions.” (emphasis added). Accordingly, the
Government argues that Andrews was charged only with
tangible rights wire fraud, that is, a scheme or artifice to
fraudulently obtain money or property from the GVI, and
thus, there was no Skilling error. We disagree.
Although the District Court may have intended to
narrow the Indictment to remove the honest services fraud
theory, there were sufficient references to “honest services” in
the redacted version of the Indictment and in the District
Court’s jury instructions to lead a jury to believe that
Andrews was charged with honest services fraud. First, the
“Introduction” section of the redacted Indictment stated that
“Ohanio Harris had a duty to uphold the laws of the United
States and the Virgin Islands; and to provide honest services
7
On September 15, 2006, the District Court asked the
Government to provide a redacted copy of the Indictment, but
it is unclear from the record why the honest services theory
was removed. The District Court told the jury simply that
“[the Indictment] says ‘redacted’ on it. That just means it’s
something that I have done in order to make this read
consistent with the evidence that’s in the box.”
15
to the people of the Virgin Islands.” (emphasis added).
Although the Government removed references to “honest
services” in the substantive portions of the conspiracy and
wire fraud counts, after describing the basis for the wire fraud
charges, the Indictment charged Andrews with the violation
of § 1346, the honest services fraud statute, when it stated,
“[a]ll in violation of Title 18, United States Code, Sections
1343, 1346 and 2.” (emphasis added). Second, in its verbal
charge to the jury, the District Court referred several times to
“honest services” and “honest services fraud.” During the
introductory portion of the instruction, the District Court
stated, “[t]he federal claims in this case . . . all relate to claims
of fraudulent intent or attempts to corruptly deprive the
Government of the Virgin Islands of the honest services of an
officer or employee of the Government of the Virgin Islands.”
When discussing the conspiracy charge, the District Court
explained that “[t]he claim is that Ohanio Harris and Ashley
Andrews conspired to commit honest services fraud or wire
fraud and to corruptly solicit, give and accept a thing of value
from an agent of the Virgin Islands Government.” Several
sentences later, the District Court reiterated that
“the government has to prove beyond a
reasonable doubt that the conspiracy or the
agreement or understanding described in the
indictment, to commit honest services fraud or
wire fraud, or to corruptly influence an agent of
the Virgin Islands Government, was formed by
two or more persons, and was existing at or
about the time of the charge in the indictment.”
16
Although the District Court made the last two statements
when discussing the conspiracy charge, a jury could certainly
have understood them as references to Counts Two through
Five, because the conspiracy count essentially charged the
defendants with conspiracy to commit Counts Two through
Five. 8 As such, we cannot agree with the Government that
there was no Skilling error in this case.
The Government points out that after Andrews’s
attorney objected to language in the initial instruction, the
District Court provided a clarifying instruction, explaining
that the jury was obligated to consider the charges as they
were presented in the Indictment. Because the substantive
allegations in the Indictment contained no references to
honest services fraud, the Government contends, this
additional instruction was sufficient to cure any error in the
District Court’s previous instructions. We disagree.
Although a narrowing instruction may be sufficient to
withdraw a previously-given instruction, see Whitney v. Horn,
280 F.3d 240, 255-56 (3d Cir. 2002), the additional
instruction provided here was not. The District Court did not
specifically address the honest services language that it had
used, nor did it mention anything about removing 18 U.S.C. §
1346, which was mentioned in the Indictment, from the jury’s
8
It is important to note that despite these references to
honest services fraud in the conspiracy instructions, Andrews
does not argue that Skilling invalidated his conspiracy
conviction, at least not directly. He does, however, raise a
prejudicial spillover challenge to the conspiracy count, which
we will address later.
17
consideration. Rather, the District Court issued the clarifying
instruction in response to an objection to its earlier instruction
that “[w]hat must be proved beyond a reasonable doubt is that
the defendant knowingly participated in the scheme to
defraud, a scheme that is substantially the same as the one
alleged in the indictment.” Andrews’s counsel argued that
the jury was required to find a scheme that was “exactly the
same” as the scheme charged in the Indictment, not one that
was “substantially the same.” The District Court agreed that
its language was potentially misleading, and re-instructed the
jury as follows:
“With respect to the wire fraud counts, I think I
charged you that the government had the burden
of proving beyond a reasonable doubt that the
scheme existed as it was charged in the
indictment, or a scheme that was substantially
the same as that charged in the indictment. And
I think you’ll see the words ‘substantially the
same,’ . . . in your instructions. . . . You are
instructed to disregard ‘substantially the same.’
What has to be proven is the scheme alleged in
the indictment. . . . It is, as I told you, the
government’s obligation to prove what is
charged in the indictment in Counts 2 through
5. It is that simple. The scheme there is to, as
alleged, to defraud the Government of the
Virgin Islands; not just a scheme, but a scheme
to defraud the Government of the Virgin
Islands, as charged in the indictment.”
18
Although this instruction clarified that the jury must
consider only the scheme charged in the Indictment, the
Indictment itself charged Andrews with violating 18 U.S.C. §
1346, the honest services fraud statute. Moreover, in the
absence of an instruction specifically telling the jury to
disregard all previous references to honest services fraud, we
do not believe that the narrowing instruction provided by the
District Court was sufficient to remove the taint of the
previous instructions. 9
2.
Having concluded that the first prong of the plain error
test is met, we likewise conclude that the second prong is met.
Although there was no plain error in the District Court’s
instructions at the time of trial, the error became apparent
when the Supreme Court in Skilling limited honest services
fraud to bribes and kickbacks. See United States v. Retos, 25
F.3d 1220, 1230 (3d Cir. 1994) (explaining that an error is
plain “where the error was unclear at the time of trial but
9
We also note that the Presentence Investigation
Report listed the statutes violated as 18 U.S.C. §§ 1343, 1346,
and 2 and stated that Andrews was charged with “knowingly
devis[ing] a scheme and artifice to defraud and for obtaining
money and property and to deprive another of the intangible
right of honest services.” Although this is not dispositive,
and the Probation Officer certainly could have been mistaken
as to what was ultimately charged in the redacted Indictment,
it suggests that, at the very least, there was confusion as to
whether Andrews was charged with honest services fraud.
19
becomes clear on appeal because the applicable law has been
clarified” (quoting Olano, 507 U.S. at 734)).
3.
We turn now to the third step of our inquiry, which
requires us to determine whether the error affected Andrews’s
substantial rights, “which in the ordinary case means
[whether] it affected the outcome of the district court
proceedings.” Marcus, 130 S. Ct. at 2164 (internal marks and
citations omitted). In other words, we must determine
whether the error was harmless. Id. (citing Olano, 507 U.S.
at 734-35). Under plain error review, a defendant bears the
burden of demonstrating that the error was not harmless, i.e.,
that there is “a reasonable probability that the error affected
the outcome of the trial.” Olano, 507 U.S. at 734. 10 We
10
There is a narrow category of cases involving
“structural errors,” which affect the “framework within which
the trial proceeds.” United States v. Marcus, 130 S. Ct. 2159,
2164 (2010) (citing Johnson v. United States, 520 U.S. 461,
468 (1997)). The Supreme Court has left open the possibility
that in cases involving “structural errors,” the defendant need
not demonstrate that the error impacted the outcome of the
trial. Id. at 2164-65. However, Skilling error is not
“structural” and thus, Andrews bears the burden of
demonstrating that the error was not harmless. See Hedgpeth
v. Pulido, 555 U.S. 57, 58 (2008) (per curiam) (holding that
no “structural error” occurs where a jury is instructed on
alternative theories of guilt, and the defendant alleges that the
jury relied on an invalid theory); United States v. Skilling
(Skilling II), 638 F.3d 480, 483 (5th Cir. 2011).
20
conclude that Andrews has not met that burden because:
(1) he has not established a reasonable probability that he
would have been acquitted of tangible wire fraud absent the
Skilling error, and alternatively (2) he cannot demonstrate that
the jury would not have convicted him of honest services
fraud had it been instructed that the fraudulent scheme must
involve bribery or kickbacks.
First, we find that, irrespective of the error, Andrews
still would have been convicted of wire fraud (Counts Two
through Five) on the valid theory of tangible rights fraud
under 18 U.S.C. § 1343. 11 Where there is a clear alternative
theory of guilt, supported by overwhelming evidence, a
defendant likely cannot show that an instruction permitting
the jury to convict on an improper basis was not harmless
error. See United States v. Skilling (Skilling II), 638 F.3d
480, 482 (5th Cir. 2011); United States v. Black (Black II),
625 F.3d 386, 388, 392-94 (7th Cir. 2010); see also Hedgpeth
v. Pulido, 555 U.S. 57, 61 (2008) (per curiam) (explaining
that an instructional error may be harmless “so long as the
error at issue does not categorically vitiate all the jury’s
findings” and that “[a]n instructional error arising in the
context of multiple theories of guilt no more vitiates all the
jury’s findings than does omission or misstatement of an
element of the offense when only one theory is submitted”)
(internal marks and citations omitted). In contrast, where
11
Because the jury returned a general verdict, we
cannot say definitively which of the Government’s theories
the jury actually relied on to convict Andrews on Counts Two
through Five.
21
evidence on the valid alternative theory is relatively weak, the
government relies heavily on the improper theory, and the
district court’s instructions on the improper theory are
“interwoven” throughout the jury charge, the instructional
error will not be harmless. See United States v. Wright, 665
F.3d 560, 572 (3d Cir. 2012); Riley, 621 F.3d at 324; United
States v. Hornsby, 666 F.3d 296, 305-07 (4th Cir. 2012). In
this case, the Government presented overwhelming evidence
that Andrews committed tangible wire fraud and although the
District Court referred to “honest services” on several
occasions in its final instructions, the District Court did not
define honest services fraud, nor were the references to
“honest services” interwoven throughout the jury charge.
Because the determination as to whether an
instructional error was harmless depends significantly on the
context in which the instruction was provided and the other
evidence presented at trial, we will review in some detail the
other cases that have addressed whether a Skilling error was
harmless. We first examine the cases in which courts have
found Skilling instructional error to be harmless. In Skilling,
Skilling was charged with, among other things, conspiracy.
130 S. Ct. at 2908. The indictment alleged several possible
objects of the conspiracy, including securities fraud and
honest services fraud. Id. Although it held that the honest
services theory was improper, the Court remanded to the U.S.
Court of Appeals for the Sixth Circuit to determine whether
the error was harmless. Id. at 2934. In Skilling II, on remand,
the Sixth Circuit held that the district court’s instruction that
the jury could convict on either theory was harmless, even
though the jury returned a general verdict on the conspiracy
22
charge without identifying the specific object of the
conspiracy. 638 F.3d at 481, 483-84. The Sixth Circuit
concluded that because the evidence at trial overwhelmingly
proved conspiracy to commit securities fraud, the verdict on
the conspiracy charge would have been the same absent the
erroneous instruction on honest services fraud. Id. at 483-84,
488. The court also noted that the indictment “focused
primarily” on securities fraud, and the government only
mentioned the honest services theory in relation to Skilling
once during its closing argument. Id. at 483 & n.3. 12
Similarly, in United States v. Black (Black II), 625
F.3d at 392-93, on remand from the Supreme Court in Black
v. United States, 130 S. Ct. 2963 (2010), the U.S. Court of
Appeals for the Seventh Circuit held that the district court’s
Skilling error was partially harmless. In that case, the
defendants were charged with two counts of fraud. Black II,
625 F.3d at 388. For both counts, the jury was instructed on
two alternative theories: (1) a scheme to fraudulently
appropriate money from the company of which the
defendants were executives (pecuniary fraud), and (2) a
scheme to deprive the company of their “intangible right of
honest services.” Id. The Seventh Circuit explained that
although the honest services instruction was improper after
Skilling, “if it [was] not open to reasonable doubt that a
reasonable jury would have convicted [the defendants] of
pecuniary fraud, the convictions on the fraud counts [would]
12
The government did, however, rely heavily on the
honest services theory in relation to Skilling’s co-defendant,
Kenneth Lay. Skilling II, 638 F.3d at 483.
23
stand.” Id. (citations omitted). The court explained that the
evidence was sufficient to prove pecuniary fraud on both
counts and the jury was correctly instructed on the elements
of pecuniary fraud. Id. at 391. However, in light of the
Skilling error, “the question [was] . . . whether a reasonable
jury might have convicted the defendants of [honest services
fraud] but not have convicted them of pecuniary fraud.” Id. at
392. The Seventh Circuit reached a different answer to this
question for each of the two counts based on the factual
distinctions between the respective schemes to defraud. As to
the first count, the court found that the government made out
“a solid honest-services case . . . but not a solid pecuniary-
fraud case,” and thus, it was impossible to say with certainty
that the jury did not convict solely on the basis of the honest
services theory. Id. However, the court upheld the
defendants’ conviction on the second count, reasoning that
“the evidence of pecuniary fraud [was] so compelling that no
reasonable jury could have refused to convict [them] of it.”
Id. at 393. In reaching this conclusion, the court noted that
the basis for the honest services fraud conviction was
“mentioned in passing in the information, but the evidence at
trial, and the closing arguments, focused on whether [certain
acts were] merely an oversight or instead proof of pecuniary
fraud.” Id.
In contrast, in United States v. Riley, 621 F.3d at 324,
United States v. Wright, 665 F.3d at 571, and United States v.
Hornsby, 666 F.3d at 307, the improper honest services
instructions were found to be reversible error. In Riley, the
defendants were charged with three counts of mail fraud
under 18 U.S.C. §§ 1341 and 2, based on a scheme to
24
fraudulently convey city-owned property, one count of
program fraud under 18 U.S.C. § 666(a)(1)(A), stemming
from the fraudulent sales of the property, and one count of
conspiracy to defraud the public of a codefendant’s honest
services, in violation of 18 U.S.C. §§ 1341, 1346, and 371.
621 F.3d at 317. As an introduction to the conspiracy charge,
the district court told the jury that “honest services . . . fraud
does not require a scheme to defraud another to obtain money
or property” and could instead be based on the violation of “a
duty of honest, faithful and disinterested service to the public
and that official’s public employer.” Id. at 323 n.15. The
district court then explained that the jury could convict on the
conspiracy charge if it found that the public official
codefendant, Sharpe James, breached one or more of the
following duties of honest services that he owed to the State
of New Jersey and the City of Newark: 13 (1) “knowingly
committing acts related to his official positions that were
unauthorized exercises of his official functions for the
purpose of obtaining and receiving money and benefits for
himself and others from the governments that he
represented”; (2) “as part of his fiduciary duty and his
obligation pursuant to the circumstances set forth in [18
U.S.C.] § 666(a)(1)(A), to refrain from stealing, taking by
fraud, misapplying and misappropriating the assets of his
public employers”; or (3) “as part of his fiduciary duty, to
disclose conflicts of interest to his public employers in
13
James served as both the Mayor of Newark, New
Jersey, and as a New Jersey State Senator. Riley, 621 F.3d at
318.
25
official matters over which [he] exercised, and attempted to
exercise, official authority and discretion, and to recuse
himself where he had such conflicts of interest.” Id. at 322.
The government argued that because the first two
alternative theories of duty were valid bases for finding a
conspiracy, the district court’s improper instruction on the
third basis did not affect the defendants’ substantial rights.
Id. at 323-24. We disagreed, reasoning that although the jury
convicted James of a substantive violation referred to in one
of the alternative descriptions of duty, program fraud under
§ 666(a)(1)(A), the erroneous description of honest services
fraud was at the “heart” of the conspiracy charge and
“interwoven throughout the . . . charge.” Id. at 324. We
further observed that “[t]he very title of [the conspiracy
count], ‘Conspiracy to Use the U.S. Mail to Defraud the
Public of Defendant James’s Honest Services,’ invite[d] the
application of the [d]istrict [c]ourt’s charge to the jury
regarding honest services fraud to the entire count.” Id.
Moreover, the conspiracy instructions “began with an over-
arching umbrella description of James’s fiduciary duty as a
public official, which included the now-erroneous honest
services definition.” Id. We also noted that the government
focused on the non-disclosure of a conflict of interest and that
the conflict-of-interest theory was “pervasive . . . throughout
th[e] case.” Id. at 324, 325. Thus, we rejected the
government’s argument that a jury would have viewed the
three theories in the conspiracy instruction as alternative
forms of conspiracy liability, separate and distinct from
James’s violation of his honest services obligations, because
the district court did not make such a distinction clear. Id. at
26
324. We concluded that the “defendants ha[d] met their
burden of showing a reasonable probability that the jury
utilized the broad definition of an honest services violation
given in connection with the entire conspiracy charge.” Id.
We reached a similar conclusion in Wright. In that
case, the defendants were charged with honest services fraud,
“traditional” mail fraud, and conspiracy. 665 F.3d at 564-65.
The district court instructed the jury that it could convict for
honest services fraud under either a “conflict of interest”
theory or a “bribery” theory. Id. at 567. We held that the
improper conflict-of-interest instruction was not harmless
because there was “ample evidence on which the jury could
have convicted [the defendants] under [the conflict of
interest] theory” and “the evidence supporting the bribery
theory, while sufficient, [was] less than . . . ‘overwhelming.’”
Id. at 571 (citation omitted). We explained that, based on the
evidence, the jury may have drawn inferences about the
defendants’ intent that would not support a bribery theory.
Id. We also noted that the “trial environment . . . emphasized
the conflict-of-interest theory” and the jury instructions
devoted “about eight times more words to the conflict-of-
interest theory than they did to the bribery theory.” Id. at 572.
Likewise, in Hornsby, the U.S. Court of Appeals for
the Fourth Circuit held that a district court’s instruction that a
jury could convict the defendant of honest services fraud on a
conflict-of-interest theory was not harmless. 666 F.3d at 307.
In instructing the jury on the honest services fraud counts, the
district court explained that the jury need not consider
whether the defendant received a financial benefit from a
third party as part of the scheme to defraud; rather, the court
27
told the jury that it could convict if it found that the defendant
“fail[ed] to disclose a personal interest in a matter over which
[he had] decision-making power.” Id. at 306. The district
court further stated that a “public official’s duty and honesty
includes the duty to disclose . . . a personal conflict of
interest” and that the “failure to disclose . . . may . . .
constitute a fraudulent representation.” Id. In finding that the
improper instruction was not harmless, the Fourth Circuit
observed that the conflict-of-interest language was
“interwoven” through the honest-services instruction. Id.(citing Riley, 621 F.3d at 324). Moreover, the court noted,
the government presented strong evidence to support the
conflict-of-interest theory and emphasized in its closing
argument that “the defendant’s crime in this case is
fraudulently participating in decisions where his business
partner and his girlfriend had a stake and concealing it from
the board.” Id. at 306-07. Thus, although the facts arguably
showed that the defendant also received a kickback, based on
the nature of the jury instructions and the emphasis placed on
the conflict-of-interest theory, the Fourth Circuit held that it
could not be certain whether the jury relied on a conflict-of-
interest theory or a kickbacks theory. Id. at 307.
Our case is distinguishable from those in which courts
have determined that Skilling instructional error was not
harmless. First, as in Skilling II, 638 F.3d at 483-84, and
Black II, 625 F.3d at 393, the Government presented
overwhelming evidence of tangible rights (pecuniary) fraud.
The testimony conclusively established that the object of
Andrews’s fraudulent scheme was a tangible asset, that is, a
multi-million dollar sewer repair contract from the GVI.
28
Although the evidence also showed a scheme to defraud the
GVI of Harris’s honest services, the evidence of pecuniary
fraud was so compelling that no reasonable jury could have
refused to convict Andrews on that theory.
Second, not only were the references to honest services
fraud not “interwoven” throughout the jury charge, the
District Court never explicitly instructed the jury on the
elements of honest services fraud at all. Cf. Hornsby, 666
F.3d at 306; Riley, 621 F.3d at 324. In contrast, the District
Court did properly instruct the jury on the elements of
tangible rights fraud. In reference to Counts Two through
Five, the District Court stated:
“So the government has to prove beyond a
reasonable doubt three essential elements. That
the defendant knowingly devised or participated
in a scheme to defraud, or to obtain money or
property by materially false or fraudulent
pretenses, representations, promises or
omissions. . . . So the first element the
government has to prove . . . is that there was a
scheme to defraud. So the scheme to defraud is
any deliberate plan of action or course of action
by which someone intends to deceive or to
cheat another, or by which someone intends to
deprive another of something of value. . . .
Federal law protects money and property
interests. Money or property interests are
commonly referred to as tangible rights,
because those are things that you can touch and
feel. They include, money, real property and
29
specific goods and property, goods or
possessions.”
The District Court further charged the jury that it was to
consider only the scheme to defraud that was charged in the
Indictment. The description in Counts Two through Five of
the Indictment of the “scheme to defraud” never mentions
“honest services” or “honest services fraud.” It does,
however, set forth in detail Andrews’s scheme to fraudulently
obtain the sewer repair contract, a tangible asset.
Specifically, the Indictment alleges:
“Beginning in or about December, 2000, and
continuing up to at least the Fall of 2003, in St.
Thomas and St. Croix, within the District of the
Virgin Islands and elsewhere, the defendants
Ashley Andrews, Campbell Malone, and others
. . . devised a scheme and artifice to obtain
money by means of material false and
fraudulent pretenses and representations,
omissions and concealment of material facts,
which involved securing a no-bid contract for
sewer repair work and generating a fraudulent
claim for expenses incurred as a result of
preparing a proposal for a contract to repair the
St. Croix sewer system. . . . It was a part of the
scheme and artifice to obtain money and
property and to defraud the Virgin Islands
government.”
Moreover, in contrast to Riley, 621 F.3d at 324, the
title of the challenged counts (Counts Two through Five) does
30
not mention “honest services.” In fact, the title does not even
cite § 1346, but refers only to § 1343; the title reads: “Counts
2 Through 5, 18 U.S.C. § 1343 (Wire Fraud).” Thus,
although the District Court referred to “honest services” three
times in its final charge, the Indictment, which the jurors were
explicitly instructed to follow, did not “invite[] the
application” of the honest services language to Counts Two
through Five. Compare Riley, 621 F.3d at 324, with Skilling
II, 638 F.3d at 483 n.3 (noting that the indictment “focused
primarily” on securities fraud), and Black II, 625 F.3d at 393(stating that the basis for the honest services theory was
mentioned in the information only “in passing”). 14
Furthermore, unlike in Riley, 621 F.3d at 324, where the
improper conflict-of-interest theory went to the “heart” of the
instructions, and Wright, 665 F.3d at 572, where the jury
instructions devoted eight times more words to the improper
theory, the District Court in this case made only a few passing
references to “honest services” while discussing the
conspiracy count. Given that the District Court explicitly
instructed the jury that it had to find the elements of tangible
rights fraud beyond a reasonable doubt, and we presume that
juries follow their instructions regarding a count in returning
a verdict on that count, Bronshtein v. Horn, 404 F.3d 700,
14
The only language in the Indictment that could be
interpreted as referring to honest services fraud was located in
the “Introduction” section and stated: “Ohanio Harris had a
duty to uphold the laws of the United States and the Virgin
Islands; and to provide honest services to the people of the
Virgin Islands.”
31
713-14 (3d Cir. 2005), Andrews cannot establish a
“reasonable probability,” Marcus, 130 S. Ct. at 2164, that the
passing references to “honest services” affected the jury’s
verdict on Counts Two through Five. Admittedly, the District
Court’s statement that “[t]he federal claims in this case . . . all
relate to claims of fraudulent intent or attempts to corruptly
deprive the Government of the Virgin Islands of the honest
services of an officer or employee of the Government of the
Virgin Islands” is somewhat troubling. However, in contrast
to the “umbrella” statement in Riley, the District Court’s
broad statement in this case was not followed by a further
explanation of “honest services.” Cf. Riley, 621 F.3d at
324. 15
15
It is worth noting that there is another difference
between our case and United States v. Wright, 665 F.3d 560(3d Cir. 2012). In Wright, the defendants objected to the
honest services charge at trial and thus preserved the issue for
review. Id. at 570-71. In such a situation, harmless error
review requires the government to “prove[] beyond a
reasonable doubt that the error complained of did not
contribute to the verdict obtained.” Id. at 570 (quoting United
States v. Waller, 654 F.3d 430, 434 (3d Cir. 2011)). In
contrast, when we review for plain error, the defendant bears
the burden of establishing that the error affected his
substantial rights, which requires him to show that there is “a
reasonable probability that the error affected the outcome of
the trial.” Olano, 507 U.S. at 734. Thus, Andrews faces a
more difficult challenge in demonstrating reversible error
than did the defendants in Wright.
32
Alternatively, even if Andrews could show that a
reasonable jury might not have convicted him of tangible wire
fraud absent the Skilling error, he still cannot demonstrate that
the error affected his substantial rights because any
reasonable jury would have found all of the elements of post-
Skilling honest services fraud beyond a reasonable doubt had
it been instructed that the fraudulent scheme must involve
bribery or kickbacks. A district court’s failure to instruct the
jury on an element of the offense will be harmless error if,
based on the evidence, no reasonable jury could find that the
element was not present. Neder v. United States, 527 U.S. 1,
18-19 (1999). However, if the record contains “evidence that
could rationally lead to a contrary finding with respect to the
omitted element,” the error is not harmless. Id. at 19. Here,
although the jury was not instructed that § 1346 was limited
to bribes and kickbacks, the Government proved beyond a
reasonable doubt that the fraudulent scheme involved bribery.
A bribery theory under § 1346 “requires a quid pro
quo,” Wright, 665 F.3d at 567 (quoting United States v.
Kemp, 500 F.3d 257, 281 (3d Cir. 2007)), that is, “a specific
intent to give or receive something of value in exchange for
an official act,” id. at 567-68 (quoting United States v. Sun-
Diamond Growers of Cal., 526 U.S. 398, 404-05 (1999)).
“[A] bribery theory does not require that each quid, or item of
value, be linked to a specific quo, or official act. Rather, a
bribe may come in the form of a ‘stream of benefits.’” Id. at
568 (quoting United States v. Bryant, 655 F.3d 232, 240-41
(3d Cir. 2011)). An honest services fraud prosecution for
bribery after Skilling thus requires the Government to prove:
(1) that “the payor provided a benefit to a public official
33
intending that he w[ould] thereby take favorable official acts
that he would not otherwise take,” and (2) that “the official
accepted those benefits intending, in exchange for the
benefits, to take official acts to benefit the payor.” Id.(citations omitted). “The quid pro quo can be implicit, that is,
a conviction can occur if the Government shows that [the
official] accepted payments or other consideration with the
implied understanding that he would perform or not perform
an act in his official capacity.” Id. (quoting Antico, 275 F.3d
at 257).
Here, not only did the Government allege that
Andrews committed bribery; the jury actually convicted him
of bribery, albeit under a different statute, 18 U.S.C.
§ 666(a)(2). Cf. Skilling, 130 S. Ct. at 2934 (stating that
Skilling’s conduct did not violate the narrowed version of the
statute because the government “did not, at any time, allege
that Skilling solicited or accepted side payments from a third
party in exchange for making . . . misrepresentations”). We
have never decided whether § 666(a)(2) requires proof of a
quid pro quo, and therefore whether § 666 bribery is the same
as § 1346 bribery. See Bryant, 655 F.3d at 246 n.16.
However, we need not decide that question today because the
District Court’s jury instruction required the jury to find a
quid pro quo exchange in this case. At the close of trial, the
District Court instructed the jury that as to Count Six:
[t]he government has to prove beyond a
reasonable doubt that there was action by
Ashley Andrews to corruptly attempt to
influence Ohanio Harris, knowing that he was
an agent of the Government of the Virgin
34
Islands, for the purpose of causing him to use
his position or abuse his position for the benefit
of Ashley Andrews or GRM relative to
obtaining the sewer contract.
Thus, to convict Andrews on Count Six, the jury was required
to find, as it would be under § 1346, that Andrews gave
Harris a thing of value (the quid) in exchange for Harris
performing acts in his official capacity favorable to Andrews
and GRM related to the sewer repair contract (the quo).
Given that the jury convicted Andrews on Count Six, no
rational jury could have then failed to find that the fraudulent
scheme alleged in Counts Two through Five involved bribery.
In sum, because Andrews has not shown a “reasonable
probability that the [Skilling] error affected the outcome of
the trial,” Olano, 507 U.S. at 734, we hold that there was no
plain error as to Counts Two through Five. 16 We necessarily
also conclude that there was no prejudicial spillover into the
remaining counts. “When two charges are closely linked and
we vacate [or reverse] a conviction on one of them, we must
ensure that the error on the vacated [or reversed] charge has
not affected the remaining charge.” Wright, 665 F.3d at 575.
Here, because we have determined that the District Court’s
16
Because we find that Andrews has failed to satisfy
the third prong of the plain error test, we need not consider
the fourth prong, whether “the error seriously affect[ed] the
fairness, integrity, or public reputation of judicial
proceedings.” Riley, 621 F.3d at 322 (quoting Johnson, 520
U.S. at 467).
35
Skilling error was harmless (i.e., not prejudicial), see Marcus,
130 S. Ct. at 2164, and thus did not require vacatur or reversal
of Andrews’s convictions on Counts Two through Five, there
was no prejudicial spillover to the remaining counts. 17
B.
Andrews next argues that the evidence was insufficient
to support his convictions for wire fraud, program fraud, and
inducing a conflict of interest. We will address his arguments
as to each offense in turn.
17
Given that our conclusion that the Skilling error was
harmless was based, in part, on the fact that the jury convicted
Andrews of bribery under 18 U.S.C. § 666(a)(2), we
acknowledge the potential for a circularity problem. In some
instances, it may be problematic to look to a defendant’s
conviction on one count and conclude that an error as to
another count was harmless, because there is the possibility
that prejudice from the error spilled over and led to the
conviction on the other count. However, in this case, the
Government presented such strong evidence that Andrews
committed bribery under § 666(a)(2) that we do not hesitate
to find that Andrews’s conviction on Count Six was wholly
unaffected by the Skilling error. See Black II, 625 F.3d at 390(rejecting the defendant’s argument that prejudice from the
erroneous honest services instruction spilled over to an
obstruction of justice count because the evidence of
obstruction was “very strong” and “[n]o reasonable jury could
have acquitted [the defendant] of obstruction if only it had not
been instructed on honest-services fraud”).
36
1.
To obtain a conviction for wire fraud under 18 U.S.C.
§ 1343, the Government must prove “(1) the defendant’s
knowing and willful participation in a scheme or artifice to
defraud, (2) with the specific intent to defraud, and (3) the use
of . . . interstate wire communications in furtherance of the
scheme.” Antico, 275 F.3d at 261 (citation omitted). Here,
the Government presented sufficient evidence to allow a
rational jury to find these elements beyond a reasonable
doubt. See Reyeros, 537 F.3d at 277. Andrews’s contentions
to the contrary are unavailing.
Andrews first alleges that the evidence on the wire
fraud counts was insufficient because, although he asked
Price to send bond documentation to Malone, he never asked
Price to use interstate wire communications (i.e., fax or
email). However, the statute does not require that the
defendant himself sent the communication or that he intended
that interstate wire communications would be used. Rather, §
1343 requires that the defendant “knowingly caused” the use
of interstate wire communications. United States v. Bentz, 21
F.3d 37, 40 (3d Cir. 1994). “Where one does an act with
knowledge that the use of the mails will follow in the
ordinary course of business, or where such use can reasonably
be foreseen, even though not actually intended, then he
‘causes’ the mails to be used.” Id. (quoting Pereira v. United
States, 347 U.S. 1, 8-9 (1954)); see United States v.
Giovengo, 637 F.2d 941, 944 (3d Cir. 1980) (explaining that
“cases construing the mail fraud statute are applicable to the
wire fraud statute as well”).
37
In this case, the use of interstate wire communications
was reasonably foreseeable. When Andrews asked Price,
who was in New York, to send bond application documents to
Malone, who was in the Virgin Islands, it was reasonably
foreseeable that Price would send the documents via email or
fax. Moreover, given the complexity of the bond application
process, it was reasonably foreseeable that Price and Malone
would exchange multiple emails or faxes.
Andrews also contends that the evidence was
insufficient to support his conviction on Count Two
specifically because the email transmission alleged in the
Indictment never occurred. Count Two of the indictment
states that on October 10, 2002, Price sent an email to
Malone. The Government acknowledges that no email
transmission occurred on this date; rather, as Price testified,
the documents sent on October 10 were transmitted via fax.
Andrews notes that fax and email are distinct means of
communication, and argues that by allowing the Government
to proceed on Count Two on the basis that Price sent a fax to
Malone, the District Court “constructively amended” the
Indictment. We disagree.
“An indictment is constructively amended when
evidence, arguments, or the district court’s jury instructions,
effectively amends the indictment by broadening the possible
bases for conviction from that which appeared in the
indictment.” United States v. McKee, 506 F.3d 225, 229 (3d
Cir. 2007) (internal marks and citation omitted). A
constructive amendment constitutes a “per se” violation of a
defendant’s Fifth Amendment right to a jury trial. Id.(citation omitted). In contrast, a variance occurs “when the
38
charging terms are unchanged, but the evidence at trial proves
facts materially different from those alleged in the
indictment.” Id. at 231 n.7 (internal marks and citation
omitted). “If a variance between the indictment and the
evidence does not alter the elements of the offense charged,
we will focus upon whether or not there has been prejudice to
the defendant.” Id. (internal marks and citations omitted).
Here, the discrepancy between the Indictment and the
evidence presented at trial clearly constituted a variance. See
id. The elements of wire fraud were unaffected; the
Indictment simply misstated that the October 10, 2002
transmission was made via email. Andrews suffered no
prejudice as a result of this minor variance.
2.
Andrews also argues that there was insufficient
evidence to sustain his conviction on Count Six for program
fraud. Under 18 U.S.C. § 666(a)(2), the Government must
prove that the defendant (1) corruptly gave, offered, or agreed
to give anything of value to any person, (2) “with intent to
influence or reward an agent of an organization or of a State,
local or Indian tribal government, or any agency thereof, in
connection with any business, transaction, or series of
transactions of such organization, government, or agency
involving anything of value of $5,000 or more.” Andrews
challenges his conviction under § 666(a)(2) on the basis that
the Government failed to demonstrate that Harris had the
39
authority to influence the award of the sewer contract. This
argument is meritless. 18
Harris, who qualified as an “agent” under § 666, 19 did
not have to possess actual authority over the business,
transaction, or series of transactions, that Andrews sought to
influence. See United States v. Vitillo, 490 F.3d 314, 323 (3d
Cir. 2007). Rather, the Government had to prove only that
Andrews intended, by offering a bribe to Harris, to influence
the sewer contract. The Government presented sufficient
evidence that Andrews possessed such an intent. Moreover,
even if actual ability to influence was required under § 666,
Harris had the ability to influence the awarding of the sewer
contract, as evidenced by the fact that he did exercise his
influence and steer the sewer system repair contract to
Andrews and GRM.
18
Andrews raises a similar challenge to his conviction
for inducing a conflict of interest under 3 V.I.C. §§ 1102,
1103, and 1107 (Count Eight). We reject this challenge for
similar reasons.
19
Section 666 defines “agent” as “a person authorized
to act on behalf of another person or a government and, in the
case of an organization or government, includes a servant or
employee, and a partner, director, officer, manager, and
representative.” 18 U.S.C. § 666(d)(1).
40
3.
Andrews also contends that the Government failed to
present sufficient evidence to prove Count Eight, inducing a
conflict of interest. Again, we disagree. Section 1107 of
Title 3 of the Virgin Islands Code provides that “[n]o person
shall induce or seek to induce any territorial officer or
employee to violate [3 V.I.C. § 1102(3)].” Under 3 V.I.C.
§ 1102(3):
“[n]o territorial officer or employee shall . . .
have any interest, financial or otherwise, direct
or indirect, or engaged in any business or
transaction or professional activity, or incur any
obligation of any nature, which is in substantial
conflict with the proper discharge of his duties
in the public interest and of his responsibilities
as prescribed in the laws of the Virgin Islands.”
An officer or employee is deemed to have an interest “in
substantial conflict with the proper discharge of his duties”
under Virgin Islands law “if he will derive a direct monetary
gain or suffer a direct monetary loss . . . by reason of his
official activity.” 3 V.I.C. § 1103.
The Indictment alleged that Andrews “caused Ohanio
Harris to serve as president of GRM and act on behalf of
GRM at a time when GRM sought contracts from Ohanio
Harris’ employer, the [GVI].” Andrews argues that because
the Government did not show that GRM would make a profit,
it did not prove that Harris “[would] derive monetary gain”
from his activities, and therefore did not prove that he had an
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interest “in substantial conflict” with his professional duties.
To the extent that Andrews asks us to read a certainty-of-
monetary-gain requirement into the statute, we decline to do
so. In enacting Chapter 37, Conflicts of Interest, the Virgin
Islands Legislature explained that the purpose of the statute
was “to assure the impartiality, and ethical conduct of all
involved in governmental transactions and decisions.” 3
V.I.C. § 1100. Accordingly, we hold that in a prosecution
under 3 V.I.C. §§ 1102(3), 1103, and 1107, the Government
need only prove that the “territorial officer or employee”
expected to profit from the relationship such that his
impartiality as a public official was likely to be affected.
Here, Andrews and Harris entered into an arrangement,
pursuant to which Harris would, in the future, derive
economic benefit from GRM. This expectation was sufficient
to establish a conflict of interest under Virgin Islands law.
The Government was not required to prove that GRM would
be profitable in the future; in fact, we have difficulty
envisioning how the Government would even go about doing
so.
C.
We turn now to Andrews’s final argument, that the
jury was improperly instructed on Count Seven, which
alleged fraudulent claims upon the GVI, in violation of 14
V.I.C. § 843(4). Section 843(4) makes it a crime for any
individual to “make[] or use[] any false bill, receipt, voucher,
roll, account, claim, certificate, affidavit or deposition
knowing the same to contain any fraudulent or fictitious
statement or entry- in any matter within the jurisdiction of
any officer, department, board, commission, or other agency
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of the government of the Virgin Islands.” Andrews argues
that the District Court’s final charge to the jury was improper
because it did not include a specific instruction that the jury
must find the content of the claim false, and that the jury
could not convict solely on the basis that Andrews had no
contract with the GVI and thus no right to file a claim.
However, on the first day of trial, the District Court gave
precisely the instruction that Andrews argues was required.
The District Court explained to the jury:
“The Court has ruled that whether there was, in
fact, legal authority to file the claim is
irrelevant. If one files a claim believing that
there – even believing that there is a basis for
filing a claim, one has the obligation not to file
a false claim. So the issue for the jury to
determine, and as charged in the indictment, is
whether or not the claim filed was false, and
made with fraudulent intent.”
Thus, the jury was clearly instructed that regardless of
whether Andrews had entered into a valid contract with the
GVI and had a right to file a claim for payment, an issue
which was subject to dispute, the jury could only convict if it
found that Andrews submitted a claim to the GVI, knowing
that the claim contained false statements.
Andrews did not request that the District Court repeat
this instruction during the final charge. In its final
instruction, the District Court stated:
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“the government has to prove that there was a
fraudulent claim submitted, that is, it was done
for the purpose of trying to cheat the
Government of the Virgin Islands, and that it
was done not because of mistake or accident,
not in good faith, but it was done with
fraudulent intent.”
Nothing in this instruction suggested to the jury that it could
convict Andrews under 14 V.I.C. § 843(4) if it found that
Andrews had no contract with the GVI and thus no right to
file a claim. Because we presume that the jury followed the
initial instruction, United States v. Walker, 657 F.3d 160, 171
(3d Cir. 2011), we conclude that the District Court committed
no error in instructing the jury on Count Seven.
IV.
Finally, we address the legality of the sentence
imposed by the District Court. The Government noted in its
brief that the District Court erred in imposing a “general
sentence” on Counts One through Six, instead of specifying
an individual sentence for each offense. Andrews did not
properly raise this issue in his opening brief, and ordinarily
“an appellant’s failure to identify or argue an issue in his
opening brief constitutes waiver of that issue on appeal.”
United States v. Pelullo, 399 F.3d 197, 222 (3d Cir. 2005)
(citations omitted). However, the waiver rule yields in
“extraordinary circumstances.” United States v. Albertson,
645 F.3d 191, 195 (3d Cir. 2011). In determining whether a
case presents “extraordinary circumstances,” we consider
three factors: (1) “whether there is some excuse for the
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[appellant’s] failure to raise the issue in the opening brief”;
(2) the extent to which the opposing party would be
prejudiced by our considering the issue; and (3) “whether
failure to consider the argument would lead to a miscarriage
of justice or undermine confidence in the judicial system.”
Id. (quoting In re Kane, 254 F.3d 325, 331 (1st Cir. 2001)).
The miscarriage of justice factor is “somewhat similar to the
‘plain error’ rule,” which allows appellate courts to correct an
error not raised before the district court if the error affected
the defendant’s substantial rights and “seriously affect[ed] the
fairness, integrity or public reputation of judicial
proceedings.” Id. at 196 (quoting Gambino v. Morris, 134
F.3d 156, 169 n.12 (3d Cir. 1998) (Roth, J., concurring), and
United States v. Knight, 266 F.3d 203, 207 (3d Cir. 2001)).
Applying these factors to Andrews’s case, we believe
“the balance weighs in favor of reviewing the merits” of the
general sentence issue. Id. at 195. With respect to the first
factor, Andrews has provided no compelling reason for his
failure to raise the issue in his opening brief. Thus, the first
factor weighs in favor of waiver. However, the second and
third factors weigh heavily against waiver. As to the second
factor, it is clear that the Government would suffer no
prejudice as a result of our considering the issue because the
Government expressly concedes in its brief that remand for
“clarification of the sentence” on Counts One through Six is
appropriate. Finally, as to the miscarriage of justice factor,
we have held, in the context of plain error review, that a
general sentence error under the Sentencing Guidelines
affects a defendant’s “substantial rights and result[s] in
manifest injustice because, as a result of the general nature of
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the sentence, neither we nor [the defendant] can determine
whether it was legal as to particular counts.” United States v.
Ward, 626 F.3d 179, 184 (3d Cir. 2010) (citation omitted).
Turning to the merits, we hold that the District Court
erred in imposing a general sentence of 151 months’
imprisonment on Counts One through Six. Under the
Sentencing Guidelines, a district court must impose a
sentence on each count. Ward, 626 F.3d at 184 (citing
U.S.S.G. 5G1.2(b)). Here, although the 151-month term of
imprisonment was within the statutory maximum for Counts
Two through Five, it exceeded the statutory maximum for
Counts One and Six, and due to the general nature of the
sentence, we cannot determine whether the sentence was legal
as to each count. See id. Therefore, we will vacate
Andrews’s sentence on Counts One through Six, and remand
for the limited purpose of allowing the District Court to
clarify the sentence imposed on each count of conviction.
V.
For the foregoing reasons, we will affirm the District
Court’s judgment of conviction, vacate the judgment of
sentence on Counts One through Six, and remand to the
District Court for resentencing.
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