Percoco v. United States

PRELIMINARY PRINT
Volume 598 U. S. Part 2
Pages 319–338
OFFICIAL REPORTS
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THE SUPREME COURT
May 11, 2023
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OCTOBER TERM, 2022 319
Syllabus
PERCOCO v. UNITED STATES et al.
certiorari to the united states court of appeals for
the second circuit
No. 21–1158. Argued November 28, 2022—Decided May 11, 2023
Petitioner Joseph Percoco served as the Executive Deputy Secretary to
New York Governor Andrew Cuomo from 2011 to 2016, a position that
gave him a wide range of infuence over state decision-making, with one
brief hiatus. During an eight-month period in 2014, Percoco resigned
from government service to manage the Governor's reelection cam-
paign. During this hiatus, Percoco accepted payments totaling $35,000
to assist a real-estate development company owned by Steven Aiello
in its dealings with Empire State Development, a state agency. After
Percoco urged a senior offcial at ESD to drop a requirement that Aiel-
lo's company enter into a “Labor Peace Agreement” with local unions
as a precondition to receiving state funding for a lucrative project, ESD
informed Aiello the following day that the agreement was not necessary.
When Percoco's dealings came to the attention of the U. S. Department
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of Justice, he was indicted and charged with, among other things, con-
spiracy to commit honest-services wire fraud in relation to the labor-
peace requirement (count 10). See 18 U. S. C. §§ 1343, 1346, 1349.
Throughout the proceedings, Percoco argued unsuccessfully that a pri-
vate citizen cannot commit or conspire to commit honest-services wire
fraud based on his own duty of honest services to the public. Over
Percoco's objection, the trial court instructed the jury that Percoco
could be found to have had a duty to provide honest services to the
public during the time when he was not serving as a public offcial if the
jury concluded, frst, that “he dominated and controlled any governmen-
tal business” and, second, that “people working in the government actu-
ally relied on him because of a special relationship he had with the gov-
ernment.” As relevant here, the jury convicted Percoco on count 10.
On appeal, the Second Circuit affrmed, explaining that the challenged
jury instruction ft the Second Circuit's understanding of honest-
services fraud as adopted many years earlier in United States v. Margi-
otta, 688 F. 2d 108.
Held: Instructing the jury based on the Second Circuit's 1982 decision in
Margiotta on the legal standard for fnding that a private citizen owes
the government a duty of honest services was error. Pp. 325–333.
(a) Prior to this Court's 1987 decision in McNally v. United States,
483 U. S. 350, “all Courts of Appeals had embraced” the view that the
320 PERCOCO v. UNITED STATES
Syllabus
federal wire fraud and mail fraud statutes proscribe what came to be
known as “honest-services fraud.” Skilling v. United States, 561 U. S.
358, 401. Most cases prosecuted under these statutes involved public
employees accepting a bribe or kickback that did not necessarily result
in a fnancial loss for the government employer but did deprive the gov-
ernment of the right to receive honest services. See id., at 400–401.
The Second Circuit considered a different fact pattern in Margiotta, in
which the government had charged an unelected individual with honest-
services mail fraud for using his position as a political-party chair to
exert substantial control over public offcials. The court held that a
private person could commit honest-services fraud if he or she “domi-
nate[d] government.” 688 F. 2d, at 122. Shortly after Margiotta, how-
ever, this Court rejected the entire concept of honest-services fraud in
McNally. But “Congress responded swiftly” to McNally, and enacted
18 U. S. C. § 1346, which provides that “ ``the term “scheme or artifce to
defraud,” ' ” which appears in both § 1341 and § 1343, “ ``includes a scheme
or artifce to deprive another of the intangible right of honest services.' ”
Skilling, 561 U. S., at 402 (quoting § 1346). Decades later in Skilling,
this Court rejected the broad argument that § 1346 is unconstitutionally
vague and clarifed that “the intangible right of honest services” in
§ 1346 relates to “fraudulent schemes to deprive another of honest serv-
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ices through bribes or kickbacks supplied by a third party who had not
been deceived.” 561 U. S., at 404.
Skilling's approach informs the Court's decision in this case. The
Second Circuit concluded that “Congress effectively reinstated the
Margiotta-theory cases by adopting statutory language that covered the
theory.” 13 F. 4th 180, 196. But Skilling took care to avoid giving
§ 1346 an indeterminate breadth that would sweep in any conception of
“intangible rights of honest services” recognized by some courts prior to
McNally. By rejecting the Government's argument that § 1346 should
apply to cases involving “ ``undisclosed self-dealing by a public offcial or
private employee,' ” 561 U. S., at 409, the Skilling Court made clear that
“the intangible right of honest services” must be defned with the clarity
typical of criminal statutes and should not be held to reach an ill-defned
category of circumstances simply because of a few pre-McNally deci-
sions. Pp. 325–329.
(b) Percoco's arguments challenging the honest-services conspiracy
count against him—that he was out of public offce during part of the
time period within the indictment and that a private citizen cannot be
convicted of depriving the public of honest services—sweep too broadly.
The Court rejects the idea that a person nominally outside public em-
ployment can never have the necessary fduciary duty to the public.
Through principles of agency, an individual who is not a formal employee
Cite as: 598 U. S. 319 (2023) 321
Syllabus
of a government may become an actual agent of the government by
agreement, and thereby have a fduciary duty to the government and
thus to the public it serves. While the Court rejects the absolute rule,
“the intangible duty of honest services” codifed in § 1346 plainly does
not extend a duty to the public to all private persons, and the Court
therefore addresses if Margiotta states the correct test. Pp. 329–330.
(c) The jury instructions based on the Margiotta theory in Percoco's
case were erroneous. Margiotta's standard in the instructions—imply-
ing that the public has a right to a private person's honest services
whenever that private person's clout exceeds some ill-defned thresh-
old—is too vague. Without further constraint, the jury instructions did
not defne “the intangible right of honest services” “ ``with suffcient
defniteness that ordinary people can understand what conduct is pro-
hibited' ” or “ ``in a manner that does not encourage arbitrary and dis-
criminatory enforcement.' ” McDonnell v. United States, 579 U. S.
550, 576.
The Government does not defend the jury instructions as an accurate
statement of the law, but instead claims that the imprecision in the jury
instructions was harmless error. The Government argues that a pri-
vate individual owes a duty of honest services in the discrete circum-
stances (1) “when the person has been selected to work for the govern-
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ment” in the future and (2) “when the person exercises the functions of
a government position with the acquiescence of relevant government
personnel.” Brief for United States 25. These theories, however, dif-
fer substantially from the instructions given the jury in this case, and
the Second Circuit did not affrm on the basis of either of them.
Pp. 330–333.
13 F. 4th 180, reversed and remanded.
Alito, J., delivered the opinion of the Court, in which Roberts, C. J.,
and Sotomayor, Kagan, Kavanaugh, and Barrett, JJ., joined, and in
which Jackson, J., joined as to all but Part II–C–2. Gorsuch, J., fled an
opinion concurring in the judgment, in which Thomas, J., joined, post,
p. 333.
Yaakov M. Roth argued the cause for petitioner. With
him on the briefs were Michael J. Rubenstein, Barry A.
Bohrer, and Michael L. Yeager. Alexandra A. E. Shapiro,
Ted Sampsell-Jones, and Daniel J. O'Neill fled briefs for
respondent Steven Aiello under this Court's Rule 12.6, in
support of petitioner.
322 PERCOCO v. UNITED STATES
Opinion of the Court
Nicole Frazer Reaves argued the cause for the United
States. With her on the brief were Solicitor General Prelo-
gar, Assistant Attorney General Polite, Deputy Solicitor
General Feigin, and John-Alex Romano.*
Justice Alito delivered the opinion of the Court.†
In this case, we consider whether a private citizen with
infuence over government decision-making can be convicted
for wire fraud on the theory that he or she deprived the
public of its “intangible right of honest services. ”
18 U. S. C. §§ 1343, 1346. Petitioner Joseph Percoco was
charged with conspiring to commit honest-services wire
fraud during a period of time that included an eight-month
interval between two stints as a top aide to the Governor of
New York. Percoco was convicted of this offense based on
instructions that required the jury to determine whether he
had a “special relationship” with the government and had
“dominated and controlled” government business. 2 App.
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511. We conclude that this is not the proper test for deter-
mining whether a private person may be convicted of honest-
services fraud, and we therefore reverse and remand for fur-
ther proceedings.
I
Percoco was a longtime political associate of former New
York Governor Andrew Cuomo. Except for a brief but
important hiatus in 2014, Percoco served as the Governor's
Executive Deputy Secretary from 2011 to 2016, and that po-
sition gave him a wide range of infuence over state decision-
*Briefs of amici curiae urging reversal were fled for Citizens United
et al. by Gary M. Lawkowski, Michael Boos, and Daniel H. Jorjani; for
the National Association of Criminal Defense Lawyers by Joshua L. Dra-
tel and Steven F. Molo; and for the New York Council of Defense Lawyers
by Harry Sandick.
Roman Martinez fled a brief for the Chamber of Commerce of the
United States of America as amicus curiae.
†Justice Jackson joins all but Part II–C–2 of this opinion.
Cite as: 598 U. S. 319 (2023) 323
Opinion of the Court
making. In April 2014, Percoco resigned from this position
to manage the Governor's reelection campaign, but after the
Governor was reelected, he resumed his role as Executive
Deputy Secretary in December 2014.
The question we address today arises from Percoco's activ-
ities during his break in government service. In July 2014,
Empire State Development (ESD), a state agency, informed
developer Steven Aiello that his real-estate company, COR
Development, needed to enter into a “Labor Peace Agree-
ment” with local unions if he wished to receive state funding
for a lucrative project. Id., at 597. Interested in avoiding
the costs of such an agreement, Aiello reached out to Percoco
through an intermediary so that Percoco could “help us with
this issue while he is off the 2nd foor,” i. e., the foor that
housed the Governor's offce. Id., at 594. Percoco agreed
and received two payments totaling $35,000 from Aiello's
company in August and October 2014. On December 3,
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mere days before returning to his old job, Percoco called a
senior offcial at ESD and urged him to drop the labor-peace
requirement. ESD promptly reversed course the next day
and informed Aiello that the agreement was not necessary.
Percoco's dealings in this and other matters later came to
the attention of the United States Department of Justice,
which obtained a multi-count indictment against Percoco and
others for engaging in several allegedly illegal schemes.1
Percoco was charged with two counts of conspiring to com-
mit honest-services wire fraud, in violation of 18 U. S. C.
§§ 1343, 1346, and 1349; two counts of soliciting bribes and
gratuities, in violation of § 666(a)(1)(B); and three counts of
Hobbs Act extortion, in violation of § 1951. 1 App. 96–103.
Only the wire fraud conspiracy count relating to the labor-
peace requirement (count 10) is directly at issue before this
Court.
1
Louis Ciminelli, see No. 21–1170, was also named in this indictment but
not in the counts at issue in this case.
324 PERCOCO v. UNITED STATES
Opinion of the Court
That count alleged a conspiracy running “[f]rom at least
in or about 2014, up to and including in or about 2015,” that
is, both during the time when Percoco was formally em-
ployed in the Governor's offce and during the period when
he was working on the Governor's campaign. See id., at 100
(incorporating ¶4 and ¶¶33–35 of the indictment). Before
trial, Percoco moved for dismissal of that count—and another
conspiracy count overlapping with the campaign period—on
the ground that a private citizen cannot commit or conspire
to commit honest-services wire fraud based on his own duty
of honest services to the public. See id., at 130, 133. The
District Court denied that motion, noting that the indictment
alleged that Percoco, while formally working on the Gover-
nor's campaign, had “ ``continued to function in a senior ad-
visory and supervisory role with regard to the Governor's
Offce' ” and had “ ``continued to be involved in the hiring of
staff and the coordination of the Governor's offcial events
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and priorities . . . among other responsibilities.' ” Id., at 133
(quoting id., at 77, Indictment ¶4).
At trial, the prosecution introduced evidence to support
the indictment's allegations about Percoco's activities during
his break in offcial service, as well as evidence that he had
expressed his intent and had made plans to resume offcial
service after the election. See 13 F. 4th 180, 201–203 (CA2
2021). At the end of the prosecution's case, Percoco again
moved for judgment of acquittal on count 10, contending that
no evidence showed that he had taken any act in furtherance
of that conspiracy while serving in an offcial government
capacity. Id., at 187.
The court reserved decision on that motion, ibid., and the
case was submitted to the jury. Over defense counsel's ob-
jection, the court instructed that Percoco could be found to
have had a duty to provide honest services to the public dur-
ing the time when he was not serving as a public offcial if
the jury concluded, frst, that “he dominated and controlled
any governmental business” and, second, that “people work-
Cite as: 598 U. S. 319 (2023) 325
Opinion of the Court
ing in the government actually relied on him because of a
special relationship he had with the government.” 2 App.
511. The jury convicted Percoco on count 10, as well as two
other charged counts relating to additional conduct, but ac-
quitted him on the other charges. The court then denied
Percoco's motion for judgment of acquittal, and he was sen-
tenced to 72 months' imprisonment. 13 F. 4th, at 187–188.
On appeal, the Second Circuit affrmed. The court ex-
plained that the “fduciary-duty [jury] instruction” given by
the trial judge “f[t] comfortably” with, and in fact restated,
the understanding of honest-services fraud that the Second
Circuit had adopted many years earlier in United States v.
Margiotta, 688 F. 2d 108 (1982). See 13 F. 4th, at 194 (noting
that Percoco and his co-defendants “seem to agree that the
district court's fduciary-duty instruct[ion] falls within Mar-
giotta”). Based on that precedent, the court also rejected
Percoco's claim that there was insuffcient evidence to prove
that he had “owed New York State a duty of honest services
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while he was managing the Governor's campaign.” Id.,
at 201.
Percoco sought this Court's review, asking us to decide
whether a private citizen who “has informal political or
other infuence over governmental decisionmaking” can be
convicted of honest-services fraud. Pet. for Cert. i. We
granted certiorari. 597 U. S. ––– (2022).2
II
A
As noted, the decision below was based squarely on the
Second Circuit's 1982 decision in Margiotta, and we there-
2
Percoco did not petition for review of the Second Circuit's affrmance
of the two other convictions relating to additional conduct, including a
conviction that also charged conspiracy to commit honest-services fraud.
See Pet. for Cert. 8. He now argues that reversal of his conviction on the
wire fraud conspiracy count before the Court necessitates reversal of
these other counts due to “prejudicial spillover.” Brief for Petitioner 20.
We do not reach this question.
326 PERCOCO v. UNITED STATES
Opinion of the Court
fore begin by briefy recounting the events that led up to
and followed that decision. The federal wire fraud statute,
§ 1343 (like the older federal mail fraud statute, § 1341), tar-
gets the use of certain instrumentalities to advance “any
scheme or artifce to defraud, or for obtaining money or prop-
erty by means of false or fraudulent pretenses, representa-
tions, or promises.” Before 1987, “all Courts of Appeals had
embraced” the view that these statutes proscribe what came
to be known as “honest-services fraud.” Skilling v. United
States, 561 U. S. 358, 401 (2010). In most of these cases,
public employees had accepted a bribe or kickback in ex-
change for dishonest conduct that did not necessarily cause
their employers to suffer a fnancial loss, but this conduct
was found to constitute mail or wire fraud because it de-
prived the relevant government unit (and thus, by extension,
the public) of the right to receive honest services. See id.,at 400–401.
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In Margiotta, the Second Circuit faced a case that de-
parted from this pattern. Joseph Margiotta chaired the Re-
publican Party Committees for Nassau County and the town
of Hempstead, New York, and he used the infuence that
came with those positions to carry out a kickback scheme.
He was indicted for honest-services mail fraud, and although
he held “no elective offce,” the prosecution argued that he
nevertheless breached a duty to render honest services be-
cause his party positions “afforded him suffcient power and
prestige to exert substantial control over public offcials.”
688 F. 2d, at 113.
A divided Second Circuit panel agreed. The majority
found that “there is no precise litmus paper test” for deter-
mining when a private person “owes a fduciary duty to the
general citizenry” but that “two time-tested measures of f-
duciary status [were] helpful.” Id., at 122. These were (1)
whether “others rel[ied] upon [the accused] because of [his]
special relationship in the government” and (2) whether he
Cite as: 598 U. S. 319 (2023) 327
Opinion of the Court
exercised “de facto control” over “governmental decisions.”
Ibid. Admitting that the case before it was “novel” and that
determining when a private person owes a duty of honest
services was “a most diffcult enterprise,” the majority nev-
ertheless concluded that a private person could commit
honest-services fraud if he or she “dominate[d] government.”
Id., at 121–122. In a strongly worded partial dissent, Judge
Winter complained that the majority's interpretation lacked
“the slightest basis in Congressional intent, statutory lan-
guage or common canons of statutory interpretation” and
that it erroneously treated a variety of “politically active
persons” who have informal but strong infuence over gov-
ernment as subject to the same duties as offceholders. Id.,
at 142 (opinion concurring in part and dissenting in part).
This Court declined to review the Second Circuit's deci-
sion, 461 U. S. 913 (1983), but that decision's life as Second
Circuit precedent was short-lived. In McNally v. United
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States, 483 U. S. 350 (1987), the Court considered a similar
case, and rather than addressing the application of honest-
services fraud to private persons, the Court rejected the en-
tire concept of honest-services fraud and held that the mail
fraud statute was “limited in scope to the protection of prop-
erty rights.” Id., at 358, 360.
McNally's holding on honest-services fraud, however,
lasted for less time than Margiotta's. “Congress responded
swiftly” and enacted 18 U. S. C. § 1346, which provides that
the “ ``the term “scheme or artifce to defraud,” ' ” which ap-
pears in both § 1341 and § 1343, “ ``includes a scheme or arti-
fce to deprive another of the intangible right of honest serv-
ices.' ” Skilling, 561 U. S., at 402 (quoting § 1346).
Decades later, this Court considered and rejected the
broad argument that § 1346 is unconstitutionally vague, and
in doing so, clarifed the meaning of the phrase “the intangi-
ble right of honest services.” Id., at 402–405. Noting
§ 1346's use of “ ``[t]he defnite article “the” ' ” in the phrase
328 PERCOCO v. UNITED STATES
Opinion of the Court
“the intangible right of honest services,” we held that § 1346
covers the “core” of pre-McNally honest-services case law
and did not apply to “ ``all intangible rights of honest services
whatever they might be thought to be.' ” 561 U. S., at 404–
405 (quoting United States v. Rybicki, 354 F. 3d 124, 137–138
(CA2 2003) (en banc)). And we observed that “[i]n the main,
the pre-McNally cases involved fraudulent schemes to de-
prive another of honest services through bribes or kickbacks
supplied by a third party who had not been deceived.” 561
U. S., at 404. We reasoned that those engaging in such
schemes had suffcient reason to know that their conduct was
proscribed. Id., at 407, 410, 412.
Skilling's approach informs our decision in this case.
Here, the Second Circuit concluded that “Congress effec-
tively reinstated the Margiotta-theory cases by adopting
statutory language that covered the theory.” 13 F. 4th, at
196. But Skilling was careful to avoid giving § 1346 an in-
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determinate breadth that would sweep in any conception of
“intangible rights of honest services” recognized by some
courts prior to McNally.
This is illustrated by Skilling's rejection of the Govern-
ment's argument that § 1346 should be held to reach cases
involving “ ``undisclosed self-dealing by a public offcial or pri-
vate employee—i. e., the taking of offcial action by the em-
ployee that furthers his own undisclosed fnancial interests
while purporting to act in the interests of those to whom he
owes a fduciary duty.' ” 561 U. S., at 409–410. Because the
pre-McNally lower court decisions involving such conduct
were “inconsisten[t],” we concluded that this “amorphous
category of cases” did not “constitute core applications of the
honest-services doctrine.” 561 U. S., at 410.
Skilling's teaching is clear. “[T]he intangible right of
honest services” must be defned with the clarity typical of
criminal statutes and should not be held to reach an ill-
defned category of circumstances simply because of a smat-
Cite as: 598 U. S. 319 (2023) 329
Opinion of the Court
tering of pre-McNally decisions. With this lesson in mind,
we turn to the question whether the theory endorsed by the
lower courts in this case gave § 1346 an uncertain breadth
that raises “the due process concerns underlying the vague-
ness doctrine.” See 561 U. S., at 408.
B
As noted, Percoco moved before trial for dismissal of the
honest-services conspiracy count at issue on the ground that
he was out of public offce during part of the time period
within the indictment and that a private citizen cannot be
convicted of depriving the public of honest services. See
Defendant's Memorandum of Law in Support of Motion To
Dismiss the Superseding Indictment in No. 1:16–cr–00776
(SDNY, May 19, 2017), ECF Doc. 187, pp. 25–30. He ad-
vanced a similar theory in his motion for acquittal, emphasiz-
ing that he was acting under “a short-term agreement [with
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Aiello's frm] within the period in which he was no longer a
state employee.” 1 App. 447.
On this point, Percoco's arguments sweep too broadly. To
be sure, the pre-McNally record on honest-services fraud is
clearest when the Government seeks to prosecute actual
public offcials. Most of the pre-McNally honest-services
prosecutions, including what appears to be the frst case to
adopt that theory, involved actual public offcials. See Skill-
ing, 561 U. S., at 400–401 (citing Shushan v. United States,
117 F. 2d 110, 115 (CA5 1941)). But we reject the argument
that a person nominally outside public employment can never
have the necessary fduciary duty to the public. Without
becoming a government employee, individuals not formally
employed by a government entity may enter into agreements
that make them actual agents of the government. An
“agent owes a fduciary obligation to the principal,” see, e. g.,
1 Restatement (Third) of Agency § 1.01, Comment e, p. 23
(2005), and therefore an agent of the government has a fdu-
330 PERCOCO v. UNITED STATES
Opinion of the Court
ciary duty to the government and thus to the public it serves.
In this Court, Percoco has agreed that individuals who are
“delegated authority to act on behalf ” of a public offcial
and to perform government duties have a duty to provide
honest services. Tr. of Oral Arg. 12; see also Brief for Pe-
titioner 22, 24, 37; Reply Brief 9. This well-established
principle suffces to confrm that the lower courts correctly
rejected Percoco's per se rule and, in doing so, did not
stretch § 1346 past heartland cases. See Skilling, 561 U. S.,
at 408.
Rejecting this absolute rule, however, is not enough to
sustain Percoco's convictions on the wire fraud conspiracy
counts. “[T]he intangible right of honest services” codifed
in § 1346 plainly does not extend a duty to the public to all
private persons, and whether the correct test was applied in
this case returns us to Margiotta.
C
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Percoco challenges Publication
Margiotta theory that underlay the
jury instructions in this case, and we must therefore decide
whether those instructions are correct. We hold that they
are not.
1
Directly applying Margiotta, the trial judge told the jury
that Percoco owed a duty of honest services to the public if
(1) he “dominated and controlled any governmental busi-
ness” and (2) “people working in the government actually
relied on him because of a special relationship he had with
the government.” 2 App. 511; see Margiotta, 688 F. 2d, at
122. But Margiotta's standard is too vague. From time
immemorial, there have been éminence grises, individuals
who lacked any formal government position but nevertheless
exercised very strong infuence over government decisions.
Some of these individuals have been reviled; others have
been respected as wise counselors. The Margiotta test
Cite as: 598 U. S. 319 (2023) 331
Opinion of the Court
could be said to apply to many who fell into both of these
camps. It could also be used to charge particularly well-
connected and effective lobbyists. See id., at 142 (opinion
of Winter, J.). Margiotta acknowledged that “the public
has no right to disinterested service” from lobbyists and
political party offcials, but the rule it developed—which was
embodied in the jury instructions given in this case—implies
that the public does hold such a right whenever such
persons' clout exceeds some ill-defined threshold. Id.,
at 122. Margiotta set a low bar, i. e., the point at which
a defendant's infuence goes beyond “minimum participa-
tion in the processes of government.” Ibid. The instruc-
tions in this case demanded more, viz., proof of “domina-
t[ion],” but what does that mean in concrete terms? Is
it enough if an elected offcial almost always heeds the advice
of a long-time political adviser? Is it enough if an offce-
holder leans very heavily on recommendations provided
by a highly respected predecessor, family member, or old
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friend? Without further constraint, Margiotta does not
(and thus, the jury instructions did not) defne “the intangi-
ble right of honest services” “ ``with suffcient defniteness
that ordinary people can understand what conduct is prohib-
ited,' ” or “ ``in a manner that does not encourage arbitrary
and discriminatory enforcement.' ” McDonnell v. United
States, 579 U. S. 550, 576 (2016) (quoting Skilling, 561 U. S.,
at 402–403).
2
The Government does not defend these jury instructions
as an accurate statement of the law, but it argues that their
imprecision was harmless. Specifcally, the Government ar-
gues that a private individual owes a duty of honest services
to the public “in two discrete circumstances”: (1) “when the
person has been selected to work for the government” in the
future and (2) “when the person exercises the functions of a
government position with the acquiescence of relevant gov-
332 PERCOCO v. UNITED STATES
Opinion of the Court
ernment personnel.” Brief for United States 25; cf. 18
U. S. C. § 201(b) (federal bribery statute incorporating “per-
son[s] selected to be a public offcial”).3
The frst theory differs substantially from the jury instruc-
tions, which did not tell the jury that Percoco could be found
to owe a duty of honest services because he had been se-
lected for future government service. While the prosecu-
tion offered evidence that Percoco intended to return to gov-
ernment service after the election and had made plans to do
so, the jury could have found that the requirements set out in
the jury instructions were satisfed without relying on that
evidence. Thus, even if we assume for the sake of argument
that there is some merit in the Government's frst new the-
ory, it is far from clear that the erroneous jury instructions
would be harmless.
The Government's second new theory—i. e., that a private
citizen owes a duty to render honest services “when the per-
son exercises the functions of a government position with
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the acquiescence of relevant government personnel”—ap-
pears, as defned in its brief, to restate Margiotta's erroneous
construction of the law. See Brief for United States 33 (in-
structions “as a whole and in the context of this case . . .
correctly conveyed” this test). Moreover, the jury was not
told that it was necessary to fnd that “relevant government
personnel” “acquiesce[d]” in Percoco's exercise of govern-
ment functions.
In short, the jury instructions are substantially different
from either of the Government's new theories, and the Sec-
ond Circuit—which treated even the language the Govern-
3
The Government also alluded to a possible third theory at oral argu-
ment, saying that there were “indicia throughout this case that Petitioner
was just acting in the role . . . that he had previously formally held.” Tr.
of Oral Arg. 64. To the extent this is a belated argument that Percoco's
leaving offce was to some degree a sham, we express no view on the
viability of this alternative theory of conviction in this case on the evi-
dence presented.
Cite as: 598 U. S. 319 (2023) 333
Gorsuch, J., concurring in judgment
ment now disclaims in Margiotta as good law—did not affrm
on either of these theories. We decline to do so here.
* * *
For these reasons, the judgment of the Court of Appeals
is reversed, and the case is remanded for further proceedings
consistent with this opinion.
It is so ordered.
Justice Gorsuch, with whom Justice Thomas joins,
concurring in the judgment.
The Court holds that the jury instructions in this case
were “too vague.” Ante, at 330. I agree. But to my mind,
the problem runs deeper than that because no set of instruc-
tions could have made things any better. To this day, no
one knows what “honest-services fraud” encompasses. And
the Constitution's promise of due process does not tolerate
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that kind of uncertainty in our laws—especially when crimi-
nal sanctions loom. “Vague laws” impermissibly “hand off
the legislature's responsibility for defning criminal behavior
to unelected prosecutors and judges, and they leave people
with no sure way to know what consequences will attach to
their conduct.” United States v. Davis, 588 U. S. –––, –––
(2019).
Honest-services fraud and this Court's vagueness jurispru-
dence are old friends. The story traces back to the early
1940s when a string of lower courts began stretching the
federal mail-fraud statute's phrase “scheme or artifce to de-
fraud.” 18 U. S. C. § 1341. Everyone understood that the
phrase covers efforts to swindle money or property. But
some lower courts began suggesting that the phrase also
sweeps in schemes to deprive others of “intangible rights,”
including the right to “honest services.” Skilling v. United
States, 561 U. S. 358, 400 (2010) (citing cases). What did this
new “honest-services fraud” concept encompass? Even the
lower courts that devised the theory could not agree. They
334 PERCOCO v. UNITED STATES
Gorsuch, J., concurring in judgment
clashed over everything from who owes a duty of honest
services to what sources of law may give rise to that duty to
what sort of actions constitute a breach of it. See id., at
416–420 (Scalia, J., concurring in part and concurring in
judgment).
Eventually, that uncertainty demanded this Court's atten-
tion. In McNally v. United States, 483 U. S. 350 (1987), the
Court held that, while § 1341 “clearly protects property
rights,” it does not protect more abstract interests like a
right to “honest . . . government.” Id., at 355, 356. Mc-
Nally rested, in no small part, on vagueness concerns. Any
other interpretation, the Court emphasized, would leave the
law's “outer boundaries ambiguous.” Id., at 360. If Con-
gress wanted to extend the law to protect more than prop-
erty rights, the Court added, “it must speak more clearly
than it has.” Ibid.
Soon Congress did speak. It enacted § 1346, which now
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defnes the phrase “scheme or artifce to defraud” to include
“a scheme or artifce to deprive another of the intangible
right of honest services.” In one sense, the new law did
offer clarity. It dispelled any doubt about whether Con-
gress intended the mail-fraud statute (and later the wire-
fraud statute, § 1343) to protect a right to “honest services.”
But in another sense, the law clarifed nothing. Congress
did not address McNally's concern that the phrase “honest-
services fraud” is unworkably vague. Nothing in the new
law attempted to resolve when the duty of honest services
arises, what sources of law create that duty, or what amounts
to a breach of it. Nor did the new law cross-reference any
portion of the federal criminal code that might have lent clar-
ity to the concept.
These problems resurfaced in Skilling. There, a majority
of the Court acknowledged that a “vagueness challenge [to
§ 1346] ha[d] force.” 561 U. S., at 405. But instead of
“throw[ing] out the statute as irremediably vague,” the ma-
jority elected to fll in some of the blanks. Id., at 403–404.
Cite as: 598 U. S. 319 (2023) 335
Gorsuch, J., concurring in judgment
To that end, the majority “look[ed] to the doctrine” of honest-
services fraud as it had developed in the lower courts “in
pre-McNally cases.” Id., at 404. Recognizing the many in-
ternal tensions in that line of cases, the majority attempted
to “pare that body of precedent down to its core.” Ibid.What exactly falls within that “core”? The majority could
not say. All it could muster was that, “[i]n the main,”
honest-services convictions had involved “fraudulent
schemes to deprive another of honest services through
bribes or kickbacks supplied by a third party who had not
been deceived.” Ibid.Justice Scalia, Justice Kennedy, and Justice Thomas de-
clined to participate in Skilling's rescue mission. They saw
the Court's decision as an act of “not interpretation but in-
vention.” Id., at 422 (opinion of Scalia, J.). Nothing in the
statute, they observed, confned breaches of the duty of hon-
est services to bribes or kickbacks. Indeed, not a single
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lower court had understood the concept to be limited in that
way. Id., at 423. Nor could the dissenters fnd anything
in the judicial power permitting them to “replac[e] a vague
criminal standard that Congress adopted with a more nar-
row one (included within the vague one).” Id., at 422.
Even on its own terms, the dissenters noted, the majority's
reconstruction of the statute failed “to eliminate [its] vague-
ness.” Id., at 421. The majority had not attempted to de-
fne what constitutes a breach of the “ ``honest services' obli-
gation,” but sought to identify only conduct that fell within
its “core.” Ibid. Nor had the majority done anything to
“solve the most fundamental indeterminacy” in honest-
services-fraud theory, ibid., for nothing in its decision ex-
plained what kinds of fduciary relationships are suffcient to
trigger a duty of honest services in the frst place. Is the
duty of honest services limited “to public offcials” serving
the government? Ibid. Does it also apply “to private indi-
viduals who contract with the public?” Ibid. Or does it
apply to “everyone” who owes some sort of fduciary respon-
336 PERCOCO v. UNITED STATES
Gorsuch, J., concurring in judgment
sibility to others, including (say) a corporate offcer? Ibid.What source of law, too, should a court consult to answer
these questions? Must a fduciary duty arise from positive
state or federal law, or can it arise from general trust law,
“a corpus juris festooned with various duties”? Id., at 417–
418. All these questions, the dissenters observed, had long
divided lower courts and remained unanswered.
Today, the Court returns to these quandaries. The jury
instructions in this case sought to identify at least one in-
stance when a duty of honest services arises—namely, when
a private individual has “ ``dominated and controlled any gov-
ernmental business' ” and “ ``people working in the govern-
ment actually relied on him because of a special relationship
he had with the government.' ” Ante, at 330. But that for-
mulation, the Court holds, is “too vague” to pass constitu-
tional muster. Ibid. That is so, the Court reasons, because
it could result in the conviction of anyone whose “clout ex-
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ceeds some ill-defned threshold” and thus sweep in “effec-
tive lobbyists” exercising their First Amendment right to
petition the government. Ante, at 331. The Court also
pauses briefy to address two alternative tests the govern-
ment suggests for defning when a duty of honest services
may attach. But the Court takes no view on the frst and
rejects the second. Ante, at 332. In the end, we may now
know a little bit more about when a duty of honest services
does not arise, but we still have no idea when it does.
It's a situation that leaves prosecutors and lower courts in
a bind. They must continue guessing what kind of fduciary
relationships this Court will fnd suffcient to give rise to a
duty of honest services. For them, it is back to the drawing
board in their indictments and their jury instructions. But
they are not the main victims here. That plight belongs to
private citizens. In this country, a criminal law is supposed
to provide “ordinary people fair notice of the conduct it pun-
ishes.” Johnson v. United States, 576 U. S. 591, 595 (2015);
Cite as: 598 U. S. 319 (2023) 337
Gorsuch, J., concurring in judgment
see also Connally v. General Constr. Co., 269 U. S. 385, 391
(1926). Yet even 80 years after lower courts began experi-
menting with the honest-services-fraud theory, no one can
say what sort of fduciary relationship is enough to sustain a
federal felony conviction and decades in federal prison.
To be sure, I cannot fault the Court for the problem. The
diffculty here stems from the statute and the lower court
decisions that inspired it. I have no doubt that if all nine
Justices put our heads together, we could rewrite § 1346 to
provide fair notice and minimize the risk of uneven enforce-
ment. I have no doubt, too, that we could fnd a hook for
any such rule somewhere in the morass of pre-McNally
lower court case law. Maybe, too, that is the path we are
on, effectively writing this law bit by bit in decisions span-
ning decades with the help of prosecutors and lower courts
who present us with one option after another. But that is
not a path the Constitution tolerates. Under our system of
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separated powers, the Legislative Branch must do the hard
work of writing federal criminal laws. Congress cannot
give the Judiciary uncut marble with instructions to chip
away all that does not resemble David. See United States
v. Reese, 92 U. S. 214, 221 (1876) (“It would certainly be dan-
gerous if the legislature could set a net large enough to catch
all possible offenders, and leave it to the courts to step inside
and say who could be rightfully detained, and who should be
set at large”); United States v. Wiltberger, 5 Wheat. 76, 95
(1820) (Marshall, C. J.) (“It is the legislature, not the Court,
which is to defne a crime, and ordain its punishment”).
Doubtless, Congress had high and worthy intentions when
it enacted § 1346. But it must do more than invoke an aspi-
rational phrase and leave it to prosecutors and judges to
make things up as they go along. The Legislature must
identify the conduct it wishes to prohibit. And its prohibi-
tion must be knowable in advance—not a lesson to be learned
by individuals only when the prosecutor comes calling or the
338 PERCOCO v. UNITED STATES
Gorsuch, J., concurring in judgment
judge debuts a novel charging instruction. Perhaps Con-
gress will someday set things right by revising § 1346 to pro-
vide the clarity it desperately needs. Until then, this Court
should decline further invitations to invent rather than inter-
pret this law.
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Reporter’s Note
The attached opinion has been revised to refect the usual publication
and citation style of the United States Reports. The revised pagination
makes available the offcial United States Reports citation in advance of
publication. The syllabus has been prepared by the Reporter of Decisions
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for the convenience of the reader and constitutes no part of the opinion of
the Court. A list of counsel who argued or fled briefs in this case, and
who were members of the bar of this Court at the time this case was
argued, has been inserted following the syllabus. Other revisions may
include adjustments to formatting, captions, citation form, and any errant
punctuation. The following additional edits were made:
None