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UNITED STATES v. TRIE

July 17, 1998

UNITED STATES OF AMERICA,
v.
YAH LIN "CHARLIE" TRIE, Defendant.



The opinion of the court was delivered by: FRIEDMAN

This case is before the Court on eleven pre-trial motions filed by the defendant, Yah Lin "Charlie" Trie, and the motion filed by the United States for reciprocal discovery. The Court heard argument on the motions on July 1, 1998.

 The Court will reserve ruling on defendant's Motion 1A (to Dismiss Count 1 for Failure to State an Offense Under 18 U.S.C. § 371 and Violation of Due Process), Motion 1B (to Dismiss Count 1 Based on Improper Grand Jury Instructions or to Compel Disclosure of Grand Jury Instructions), and Motion 2 (to Dismiss Counts 9-11 for Failure to State an Offense under 18 U.S.C. § 1001). On July 27, 1998, the Court will hear argument on motions in United States v. Maria Hsia, Crim. No. 98-057, that raise issues similar to those raised by Mr. Trie in Motions 1A and 1B. Ms. Hsia has requested that the Court reserve ruling on these motions until it has heard argument on the motions in her case. *fn1" In addition, Ms. Hsia's Motions 5 and 6 appear to raise issues that are similar to those in Mr. Trie's Motion 2. The Court therefore will reserve ruling on Mr. Trie's Motions 1A, 1B and 2.

 At the motions hearing, Mr. Trie and the government jointly requested that, pending their efforts to resolve the issues, the Court defer ruling on Defendant's Motion 5 (to Dismiss Count 12 Based on Wharton's Rule), those portions of Defendant's Motion 9 (to Compel Discovery and Disclosure of Exculpatory Information) that do not relate to Brady material, and the government's Motion 1 (for Reciprocal Discovery). *fn2" This Opinion will address the remainder of the motions.

 For the reasons discussed below, the Court will grant in part and deny in part defendant's Motion 4 (to Dismiss Counts 13-15 for Improper Venue), Motion 7 (to Strike Irrelevant and Prejudicial Alleged Objectives of the Scheme to Defraud in Counts 2-8 of the Indictment), Motion 8 (for a Bill of Particulars) and the portion of defendant's Motion 9 relating to Brady material. The Court will deny defendant's Motion 3 (to Dismiss Counts 1 and 9-11 for Failure to State an Offense), Motion 6 (to Dismiss Counts 1-11 as Preempted by the Federal Election Campaign Act) and Motion 10 (for Leave to File Additional Pre-Trial Motions).

 I. BACKGROUND

 A. Federal Election Campaign Act

 The Federal Election Campaign Act ("FECA"), 2 U.S.C. §§ 431 et seq., provides a detailed set of limits governing contributions to electoral campaigns and expenditures by candidates. Of specific relevance to this case, FECA provides that "no person shall make contributions" that exceed certain limits set forth in the statute. 2 U.S.C. § 441a. The statute also prohibits "foreign nationals" from making contributions, 2 U.S.C. § 441e, and prohibits any person from making contributions in the name of another or knowingly permitting his name to be used to effect such a contribution, 2 U.S.C. § 441f. The statute charges the Federal Election Commission ("FEC") with the administration and enforcement of FECA. 2 U.S.C. § 437c. It provides for both civil and criminal enforcement, and specifies criminal penalties for certain violations, up to a maximum of one year imprisonment and/or a fine. 2 U.S.C. § 437g(d).

 A "contribution" is defined by statute, in relevant part, as "money or anything of value made by any person for the purpose of influencing any election for Federal office," see 2 U.S.C. § 431(8)(A) (emphasis added), and the contribution limits set forth in FECA undisputably apply to contributions made to candidates for federal office, otherwise known as "hard money" contributions. The government does not dispute that FECA does not generally cover contributions for state or local campaigns and non-campaign activities such as issue advocacy, otherwise known as "soft money" contributions. It does maintain, however, that a few specific provisions of FECA, including Section 441e, governing contributions by foreign nationals, do apply to soft money contributions. National political parties that support both federal and state/local candidates have set up separate accounts: "hard money" accounts for contributions that are subject to FECA and that are used for candidates in federal elections and "soft money" accounts for funds to be used only for non-federal campaigns and for non-campaign activities.

 FECA requires "political committees," including national political parties, to file reports with the FEC identifying each person who made "contribution[s]" in the aggregate annual amount of $ 200 or more. 2 U.S.C. § 434. FEC regulations go further, requiring national political party committees to report any receipt of funds over $ 200, regardless of whether the funds are deemed "hard money" or "soft money." 11 C.F.R. § 104.8(e) (requiring information, including name, address and occupation of all individuals or entities who "donate" an aggregate amount in excess of $ 200 in any calendar year to a national party committee's non-federal account(s)).

 B. The Indictment

 Count 1 of the indictment charges that Mr. Trie and his co-defendant, Yuan Pei "Antonio" Pan, *fn3" conspired to defraud the United States by impairing and impeding the lawful functions of the FEC in violation of 18 U.S.C. § 371 (the general conspiracy statute). Indictment at 6, P 14. *fn4" The alleged conspiracy encompasses several different sorts of contributions with which Mr. Trie allegedly was involved: (1) he allegedly made a number of contributions from his own personal account for which he was reimbursed from foreign sources, (2) he allegedly set up "straw" donors or "conduits" to make contributions and he then used money from foreign sources to reimburse those straw donors, and (3) he allegedly made contributions through one or more companies. Indictment at 8-17. Count 1 alleges that by making these allegedly fraudulent contributions, Mr. Trie impaired the FEC in its attempts to enforce the FECA and thereby defrauded the United States.

 Counts 2-8 allege that Mr. Trie (and in some counts Mr. Pan) devised a scheme to defraud the Democratic National Committee ("DNC") for the purpose of obtaining property and personal benefit. Indictment at 18, P 2. The scheme allegedly included using foreign money to make contributions and concealing the source of the money from the DNC. These counts charge violations of the mail and wire fraud statutes, 18 U.S.C. §§ 1341, 1343, because Mr. Trie allegedly used the mail, faxes and telephone in his scheme to defraud the DNC.

 Counts 9-11 charge Mr. Trie with aiding and abetting the making of false statements to a government agency in violation of 18 U.S.C. § 1001 and 18 U.S.C. § 2. The indictment alleges that Mr. Trie "knowingly and willfully" caused the DNC to create and submit false reports to the FEC by making false statements to the DNC which the DNC included in its reports to the FEC. Count 9 pertains to the DNC's January 22, 1996 quarterly report to the FEC; Count 10 to the DNC's April 15, 1996 quarterly report; and Count 11 to the DNC's October 15, 1996 quarterly report.

 Finally, Counts 12-15 allege that Mr. Trie tampered with witnesses and/or obstructed proceedings relating to the Senate investigation of illegal or improper activities in connection with the 1996 federal election campaign and the grand jury investigation into the charges against Mr. Trie. Indictment at 30-38. Count 12 charges a conspiracy to obstruct justice in violation of 18 U.S.C. § 371, Counts 13 and 15 charge violations of 18 U.S.C. § 1512(b)(2) (witness tampering), and Count 14 charges a violation of 18 U.S.C. § 1505 (obstruction of Congressional investigation). All of these counts allege that Mr. Trie instructed a witness to alter, destroy or conceal documents responsive to a subpoena or related to an investigation.

 II. MOTIONS TO DISMISS

 A. Defendant's Motion 3, to Dismiss Counts 1 and 9-11 for Failure to State an Offense

 Mr. Trie claims that Counts 1 and 9-11 require the government to prove that Mr. Trie was aware of the DNC's legal obligation to file contribution reports with the FEC, and he argues that the failure of the indictment to allege that he knew of the DNC's reporting obligations requires dismissal of these counts. The Court agrees with Mr. Trie that the government must prove that he knew of the DNC's reporting obligations, but disagrees that the remedy is dismissal of the indictment for failure to allege knowledge. The issue is whether the government can prove such knowledge at trial. If the government's evidence of knowledge is insufficient at trial, the Court can grant a motion for judgment of acquittal. If the government's case survives such a motion, the Court will give the jury appropriate guidance through proper jury instructions.

 Counts 9-11 of the indictment charge Mr. Trie with causing the DNC to make false statements in its reports to the FEC in violation of 18 U.S.C. § 1001 (false statements) and 2 (aiding and abetting). Section 1001 provides, in relevant part, that "whosoever, in any matter within the jurisdiction of the executive, legislative, or judicial branch of the Government of the United States, knowingly and willfully (1) falsifies, conceals, or covers up by any trick, scheme, or device a material fact; (2) makes any materially false, fictitious, or fraudulent statement or representation; or (3) makes or uses any false writing or document knowing the same to contain any materially false, fictitious, or fraudulent statement or entry" shall be held criminally liable. 18 U.S.C. § 1001 (emphasis added). Because Mr. Trie did not make any representation or statement directly to the FEC and had no duty to disclose any facts to the FEC, he cannot be prosecuted directly under Section 1001. See United States v. Curran, 20 F.3d 560, 566 (3d Cir. 1994); Republican Nat'l Comm. v. Federal Election Comm'n, 316 U.S. App. D.C. 139, 76 F.3d 400, 406 (D.C. Cir. 1996), cert. denied, 136 L. Ed. 2d 607, 117 S. Ct. 682 (1997) (contributor has no duty to reveal identity to FEC or political committees). The government therefore has charged Mr. Trie with aiding and abetting the making of false statements by another, the Democratic National Committee, in violation of 18 U.S.C. § 2(b). Section 2(b) also requires a showing of willfulness, so the government must prove that Mr. Trie "willfully" caused the DNC to file false reports. See 18 U.S.C. § 2(b) ("Whoever willfully causes an act to be done which if directly performed by him or another would be an offense against the United States, is punishable as a principal.").

 The Court agrees with Mr. Trie that when a contributor is charged as an aider and abettor in the federal election law context for causing an innocent intermediary to make a false statement to the FEC, the prosecution must prove that "defendant knew of the [political party] treasurers' reporting obligations, that he attempted to frustrate those obligations, and that he knew his conduct was unlawful." See United States v. Curran, 20 F.3d at 569. These are elements of the offense to be proved beyond a reasonable doubt at trial, and the jury must be so instructed. Id. at 570; see United States v. Ratzlaf, 510 U.S. 135, 126 L. Ed. 2d 615, 114 S. Ct. 655 (1994) (in context of banking laws, jury must find that defendant knew of regulatory reporting requirement in order to find that defendant acted willfully); but see United States v. Gabriel, 125 F.3d 89, 103 (2d Cir. 1997) (refusing to adopt Curran definition of willfulness in Section 2(b) prosecution).

 While in most criminal prosecutions a showing of willfulness does not require proof that the defendant was aware that his conduct violated a particular statute or regulation, the Court is persuaded that this case falls comfortably within an exception to that general rule. See Bryan v. United States, 141 L. Ed. 2d 197, 118 S. Ct. 1939, 1946 & nn. 18, 20 (1998) (where "highly technical" statutes such as Internal Revenue Code and banking regulatory scheme at issue in Ratzlaf present "danger of ensnaring individuals engaged in apparently innocent conduct," showing of willfulness requires proof that defendant had knowledge of specific provision of statute allegedly violated); see also id. 118 S. Ct. at 1951 (Scalia, J., dissenting); United States v. Ratzlaf, 510 U.S. at 149. The Court's conclusion is compelled, first, by the overlay of the Section 2(b) willfulness requirement on the Section 1001 willfulness requirement and, second, by Congress' expressed concern that the complexity and nature of federal election law might ensnare innocent individuals unless the government is required to prove a high standard of intent. *fn5"

 Section 2(b) and Section 1001 both require the government to prove willful conduct: For purposes of Section 1001, the government must prove that a criminal defendant knew that the statement at issue was false and that he or she willfully made the false statement, United States v. Yermian, 468 U.S. 63, 69, 82 L. Ed. 2d 53, 104 S. Ct. 2936 (1984); Bryson v. United States, 396 U.S. 64, 69-70, 24 L. Ed. 2d 264, 90 S. Ct. 355 (1969), while under Section 2(b) the government must prove that the defendant willfully caused a prohibited act, in this case the making of a false statement by the DNC. As a matter of logic, the government cannot prove that a defendant willfully caused the making of a statement he knew to be false in the absence of evidence that the defendant knew that the statement was required to be made. See United States v. Hayden, 64 F.3d 126, 132 n.8 (3rd Cir. 1995) ("If there had been no duty to disclose information in Curran and Ratzlaf, then the defendants could not have committed those offenses"); cf. United States v. Tobon-Builes, 706 F.2d 1092, 1100-01 (11th Cir. 1983) (in currency transaction prosecution, government proved Section 1001 and Section 2(b) liability by showing that defendant "knew about the currency reporting requirement and that he purposely sought to prevent the financial institutions from filing required reports"). In this case, the government therefore must prove that Mr. Trie knew of the DNC's obligation to report all contributions over $ 200 to the FEC.

 Such proof is especially required in the federal election law context where the statutory and regulatory schemes are complex and technical and proscribe behavior that an ordinary person would not know is criminal. See United v. Ratzlaf, 510 U.S. at 143-44; United States V. Curran, 20 F.3d at 568-69. When Congress amended FECA in 1976 to centralize the criminal penalties for violations of the Act, it was acutely aware that the combination of the nature of the statute, which criminalizes activity that is not inherently evil, and the complexity of the statute, which imposes highly technical reporting requirements, presented the risk that non-culpable people might be prosecuted. See 122 Cong. Rec. 8577 (March 30, 1976) (statement of Representative Rostenkowski) ("I am more concerned, however, about the provisions in the [pre-1976] law that provide harsh penalties for what may be innocent and often unknowing violations of its more technical requirements. . . . we have arrived at a very sorry state when a taxpayer becomes a criminal because he did not know that he must disclose certain information . . ."). Congress therefore provided that criminal violations prosecuted under FECA can result only in misdemeanor penalties and provided further that criminal penalties apply only to persons who "knowingly and willfully" commit a violation of the Act. 2 U.S.C. § 437g(d)(1) (emphasis added). In establishing the civil and criminal liability penalty scheme for FECA, Congress expressly stated that the "knowing and willful" requirement was intended to limit liability to cases in which "the acts were committed with a knowledge of all the relevant facts and a recognition that the action is prohibited by law." H.R. Rep. No. 94-917, at 4 (1976).

 Where FECA provides the underlying statutory scheme for a felony prosecution under the generally applicable false statements statute, it is at least as important to require the government to prove that the defendant knew of the statutory and regulatory requirements at issue as Congress concluded it was for a misdemeanor conviction under FECA itself. Like the Third Circuit, the Court therefore concludes that a showing of "willfulness" requires proof that Mr. Trie knew of the DNC's reporting obligations, that he attempted to frustrate those requirements, and that he knew his conduct was unlawful; the Court will so instruct the jury. See United States v. Curran, 20 F.3d at 569. *fn6"

 The Court's conclusion that the government must prove that Mr. Trie knew of the DNC's reporting requirements, however, does not require dismissal of the indictment as the defendant urges. As the government quite correctly points out, an indictment is sufficient if it (1) "contains the elements of the offense charged and fairly informs a defendant of the charge against which he must defend, and [2] enables him to plead an acquittal or conviction in bar of future prosecutions for the same offense." Hamling v. United States, 418 U.S. 87, 117, 41 L. Ed. 2d 590, 94 S. Ct. 2887 (1974). The indictment in this case alleges that Mr. Trie "willfully" caused the DNC to file false reports with the FEC and thus sufficiently alleges the essential element of willfulness to withstand defendant's motion to dismiss. Indeed, the Curran case itself involved the adequacy of jury instructions, not whether the indictment itself properly stated an offense. See United States v. Curran, 20 F.3d at 569-70; United States v. Oakar, 924 F. Supp. 232, 242 (D.D.C. 1996), aff'd in part, rev'd on other grounds, 324 U.S. App. D.C. 104, 111 F.3d 146 (D.C. Cir. 1997). Whether Mr. Trie knew of the reporting requirement of the DNC is a matter for proof at trial and the crafting of proper jury instructions. The Court will deny the motion to dismiss but instruct the jury that the government must prove beyond a reasonable doubt that Mr. Trie knew of the DNC's reporting obligation before it can find that he willfully caused the DNC to make a false statement. *fn7"

 B. Defendant's Motion 4, to Dismiss Counts 13-15 for Improper Venue

 Mr. Trie argues that the obstruction of justice charges (Counts 13-15) cannot be tried in the District of Columbia unless he acted within the District, and he asserts that the indictment fails to identify any acts he took in the District. While a trial court may dismiss an indictment for improper venue, Rule 12(b)(2), Fed. R. Crim. P.; see United States v. Crop Growers Crop., 954 F. Supp. 335, 351-54 (D.D.C. 1997), the failure to adequately allege the basis for venue generally should be addressed in the first instance not by dismissing the indictment but through a bill of particulars. See United States v. Honneus, 508 F.2d 566, 570 (1st Cir. 1974), cert. denied, 421 U.S. 948, 44 L. Ed. 2d 101, 95 S. Ct. 1677 (1975); United States v. Castellano, 610 F. Supp. 1359, 1388 (S.D.N.Y. 1985). The court concludes that the District of Columbia is the wrong venue for the acts alleged in Count 14 and that count therefore must be dismissed, that venue is proper in the District of Columbia for Count 15, and that venue for Count 13 is not adequately alleged in the indictment and therefore is the proper subject for a bill of particulars.

 1. Counts 13 and 15, Witness Tampering (18 U.S.C. § 1512)

 18 U.S.C. § 1512(h) contains a special venue provision for Section 1503 and 1512. It expressly provides that venue is proper "in the district in which the official proceeding (whether or not pending or about to be instituted) was intended to be affected or in the district in which the conduct constituting the alleged offense occurred." 18 U.S.C. § 1512(h). The government contends that venue is proper in the District of Columbia for Counts 13 and 15 because, while Mr. Trie himself took no acts in the District, the official proceedings at issue in these two counts took place in the District. Mr. Trie concedes that the official proceeding referenced in Count 15 was the federal grand jury proceeding in the District of Columbia but argues that the indictment does not specify the "official proceeding" in question for Count 13.

 Although the official proceeding intended by Count 13 presumably is the federal grand jury referenced in Count 12, the indictment does not clearly state that the official proceeding alluded to in Count 13 is the federal grand jury in the District of Columbia. Furthermore, none of the introductory allegations in Count 12 (incorporated by reference in Counts 13, 14 and 15) clearly relate to the January 1997 offense date in Count 13. See Indictment at 30, 35. *fn8" Since the official proceeding applicable to Count 13 is not clearly identified, the Court will order the government to provide a bill of particulars on this issue. See United States v. Honneus, 508 F.2d at 570; United States v. Castellano, 610 F. Supp. at 1388. *fn9" On the basis of the government's representations that Count 13 does in fact relate to the grand jury in the District of Columbia, however, the Court will deny the motion to dismiss this count without prejudice. In the unlikely event that information in the bill of particulars indicates that the official proceeding in Count 13 did not take place in the District of Columbia, Mr. Trie may file a renewed motion to dismiss Count 13 for improper venue.

 Mr. Trie also argues that the explicit venue provision in Section 1512(h) is unconstitutional because it provides for venue in a place other than the district where the crime was committed. See U.S. Const. Art. III, § 2 cl. 3; U.S. Const. amend. VI. In enacting Section 1512(h), Congress addressed the constitutional issue and concluded that the right provided by the Constitution to a trial in the district where the offense was committed was preserved because the statute merely established that "an obstruction of justice is 'committed' where the impact of the obstruction is felt." 134 Cong. Rec. 32,701 (1998) (statement by Sen. Biden). The Congress enacted the venue provision to address a split in the circuits concerning whether venue lies only in the district where the defendant took actions to obstruct justice or also in the district where the proceeding sought to be obstructed is pending. Id.; see also H.R. Rep. 100-169 (1987), at 11-12.

 Although Congress may not constitutionally provide venue in a district where the crime was not committed, Congress may define where a crime is committed. See 2 CHARLES ALAN WRIGHT, FEDERAL PRACTICE AND PROCEDURE § 302 at 201 (2d ed. 1982). So long as the offense has some minimal contacts with the district, a crime can be committed in a district other than the location of the defendant's acts. See, e.g., Burton v. United States, 202 U.S. 344, 387-89, 50 L. Ed. 1057, 26 S. Ct. 688 (1906) (venue for federal mail fraud is available where fraudulent letter is received, not just where mailed); United States v. Kilpatrick, 458 F.2d 864, 868 (7th Cir. 1972) (venue for aiding and abetting is available where the crime abetted was perpetrated even though the defendant acted elsewhere).

 In this case, Congress has specified that prosecution for the crime of witness tampering may be brought either in the district where the official proceeding is pending or in the district in which the conduct constituting the alleged offense occurred. 18 U.S.C. § 1512(h). The fact that an "official proceeding" is taking place in a district and that there is an impact on the proceeding is sufficient. Congress' determination in this regard is an allowable exercise of its constitutional power, and the ...


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