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UNITED STATES v. HSIA

August 13, 1998

UNITED STATES OF AMERICA,
v.
MARIA HSIA, Defendant.



The opinion of the court was delivered by: FRIEDMAN

This case is before the Court on fourteen pre-trial motions filed by defendant Maria Hsia. *fn1" The Court heard argument on the motions on July 27 and 28, 1998.

 The Court will issue separate opinions addressing defendant's Motion 1 (to Dismiss the Indictment for Violation of Due Process); Motion 2 (to Dismiss Counts in the Indictment for Their Positive Repugnance to the Federal Election Campaign Act); Motion 3 (to Dismiss Count 1 of the Indictment for Failure to State an Offense under 18 U.S.C. § 371); Motion 5 (to Dismiss Counts 2 through 6 for Failure to State an Offense Under 18 U.S.C. §§ 2(b) and 1001 (Causation)); Motion 6 (to Dismiss Counts 2 through 6 for Failure to State an Offense Under 18 U.S.C. §§ 2(b) and 1001 (False Statements)); Motion 7 (to Dismiss Counts 4 and 5 for Failure to State an Offense Under 18 U.S.C. §§ 2(b) and 1001 (Soft Money)); Motion 9 (to Dismiss Indictment Because It Offends the First Amendment); Motion 10 (to Dismiss Indictment Because It Selectively Prosecutes Maria Hsia); and Motion 11 (to Dismiss Indictment Because It is Tainted).

 For the reasons discussed below, the Court will deny Motion 4 (to Dismiss Count 1 (FEC) and Counts 2-6 for Failure to State an Offense under 18 U.S.C. §§ 371 and 1001 (Intent)) and Motion 13 (to Dismiss Count 1 for Lack of Venue). The Court will grant in part and deny in part Motion 8 (to Strike Surplusage); Motion 14 (to Compel Discovery and Disclosure of Exculpatory Information); and Motion 15 (for a Bill of Particulars).

 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 any person from making contributions in the name of another or knowingly permitting her name to be used to effect such a contribution, 2 U.S.C. § 441f, and prohibits corporations from making contributions in connection with "any election at which presidential or vice presidential electors or a Senator or Representative in, or a Delegate or Resident Commissioner to, Congress are to be voted for, or in connection with any primary election or political convention or caucus held to select candidates for any of the foregoing offices," 2 U.S.C. § 441b(a). 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. In this case, 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. *fn2" 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 Ms. Hsia conspired with the International Buddhist Progress Society ("IBPS"), a tax-exempt religious organization doing business as the Hsi Lai Temple (the "Temple"), and other unnamed co-conspirators to defraud the United States by impairing, obstructing, impeding and defeating the lawful functions and duties of the FEC and the Immigration and Naturalization Service ("INS") in violation of 18 U.S.C. § 371. *fn3" The indictment alleges that Ms. Hsia solicited IBPS to make contributions through "straw" donors or "conduits" (some of whom were monks, nuns and volunteers from IBPS) and made campaign contributions in her own name knowing that the IBPS would reimburse her. The indictment alleges that Ms. Hsia (1) impaired and impeded the FEC by concealing the fact that IBPS was the true source of the contributions, and (2) impaired and impeded the INS by submitting documents to the INS stating that IBPS was not participating in political campaigns so that the INS would permit foreign nuns and monks associated with IBPS to enter or remain in the United States when she knew that IBPS in fact was making political contributions.

 Counts 2-6 charge Ms. Hsia with causing the making of false statements to the FEC in violation of 18 U.S.C. §§ 2 and 1001. The indictment alleges that Ms. Hsia knowingly and willfully caused various political committees to submit material false statements to the FEC by concealing the identity of the true source of contributions from the committees which then relayed the false information to the FEC. Each count addresses a different report submitted to the FEC by a political committee which allegedly contained false statement(s) about the identity of actual contributors. Count 2 pertains to a July 18, 1995 report and Count 3 to an October 17, 1995 report by the Clinton-Gore '96 Committee; Count 4 relates to an April 15, 1996 report and Count 5 to a July 15, 1996 report by the Democratic National Committee; and Count 6 pertains to an October 24, 1996 report by the Patrick Kennedy Committee. Counts 2 and 3 do not identify the actual source of the contributions, but Counts 4-6 allege that IBPS was the actual contributor. Counts 2-6 all allege that Ms. Hsia solicited the contributions at issue, but only Count 6 alleges that Ms. Hsia herself wrote a contribution check for which she was reimbursed by IBPS.

 II. MOTIONS TO DISMISS

 A. Defendant's Motion 4, to Dismiss Count 1 (FEC) and Counts 2-6 for Failure to State an Offense under 18 U.S.C. §§ 371 and 1001

 Ms. Hsia contends that Counts 2-6 (false statements) and the portion of Count 1 that is based on alleged false statements to the FEC must be dismissed because the indictment fails to allege that Ms. Hsia knew that the political committees were required to report to the FEC. This Court previously has held that "when a contributor is charged as an aider and abettor in the federal election context for causing an 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. Trie, 1998 U.S. Dist. LEXIS 12468, *11, Criminal No. 98-0029, 1998 WL 427550, at * 4 (D.D.C. July 17, 1998) (quoting United States v. Curran, 20 F.3d 560, 569 (3d Cir. 1994)). The Court in Trie explained that the government is required to prove this knowledge because "a showing of 'willfulness' requires" such proof in the federal election context where the government relies on a combination of Section 2(b) and Section 1001. United States v. Trie, 1998 WL 427550, at * 6. The Court in Trie also found that the indictment sufficiently alleged the essential element of willfulness by alleging that Mr. Trie acted "knowingly and willfully" and therefore "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." Id. at 11.

 Each of the false statements counts of Ms. Hsia's indictment alleges that Ms. Hsia "knowingly and willfully caused the submission of a material false statement to the FEC." Relying on cases in which courts have created intent elements where the statutes at issue did not specify intent, Ms. Hsia maintains that the Court in Trie created a new element of intent and that the indictment therefore is defective because it does not specifically allege that Ms. Hsia knew of the political committees' reporting obligations. See United States v. Keith, 605 F.2d 462, 464 (9th Cir. 1979) ("Although an indictment tracking the language of a statute is usually adequate because statutes usually include all elements of a crime, an indictment is inadequate when it fails to allege an essential element of the offense even when it tracks the language of the statute"). Ms. Hsia has read more into the Trie opinion than exists.

 Ms. Hsia is correct that the willfulness standard articulated by the Court in Trie applies to Ms. Hsia as the solicitor of the alleged conduit contributors just as it applied to Mr. Trie as the alleged conduit contributor. The willfulness standard articulated in Trie, however, is just that: a definition of willfulness that the government must prove at trial. The Court did not create a new element or add an intent element where none had previously existed. Instead, it merely provided a definition for the existing willful intent element of a Section 1001 and 2(b) prosecution in the federal election context. As in Trie, the Court finds that the indictment sufficiently alleges the essential "willfulness" requirement in that it alleges that Ms. Hsia acted "knowingly and willfully." Ms. Hsia's motion therefore will be denied. *fn4"

 B. Defendant's Motion 13, to Dismiss Count 1 for Lack of Venue

 Ms. Hsia has been charged with conspiracy to defraud the United States by impairing and impeding the lawful functions of the Federal Election Commission and the Immigration and Naturalization Service in violation of 18 U.S.C. § 371. She has moved to dismiss the conspiracy count for lack of venue. Because conspiracy is considered a continuing offense, see United States v. Tannenbaum, 934 F.2d 8, 12 (2d. Cir. 1991); United States v. Cordero, 668 F.2d 32, 43 n.17 (1st Cir.1981), venue for this charge is governed by 18 U.S.C. § 3237. In relevant part, Section 3237 provides that "any offense against the United States begun in one district . . . may be inquired of and prosecuted in any district in which such offense was begun, continued, or completed." 18 U.S.C. § 3237(a). This language has been interpreted to limit venue to "'any district in which some overt act in furtherance of the conspiracy was committed by any of the co-conspirators.'" United States v. Lam Kwong-Wah, 288 U.S. App. D.C. 54, 924 F.2d 298, 301 (D.C. Cir. 1991) (quoting United States v. Rosenberg, 281 U.S. App. D.C. 209, 888 F.2d 1406, 1415 (D.C. Cir. 1989)), cert. denied, 506 U.S. 901 (1992); see Hyde v. United States, 225 U.S. 347, 56 L. Ed. 1114, 32 S. Ct. 793 (1912).

 As a preliminary matter, Ms. Hsia contends that the government must allege venue separately for each of the two objects of the conspiracy -- the FEC and the INS. Because the government has alleged no overt acts in the District of Columbia that were taken in furtherance of the INS object of the alleged conspiracy, Ms. Hsia argues that there is no basis for venue here for the INS as an object of the conspiracy. She cites no cases in support of this proposition. The government responds that dividing a single conspiracy charge into its two objects is inappropriate for purposes of establishing venue. It claims that it must prove at trial only that at least one act was committed in furtherance of the conspiracy -- not one act in furtherance of each object of the conspiracy. It therefore follows, according to the government, that to establish venue it must allege only one overt act in furtherance of the conspiracy as a whole that occurred in the District of Columbia. *fn5" The Court agrees. The essence of the crime of conspiracy is the agreement. See Braverman v. United States, 317 U.S. 49, 53, 87 L. Ed. 23, 63 S. Ct. 99 (1942); United States v. Young, 503 F.2d 1072, 1076 (3rd Cir. 1974). In this case, the indictment alleges that there was one agreement: to defraud the United States by impairing and impeding the FEC and the INS. Venue for Count 1 therefore is proper in the District of Columbia as long as at least one overt act in furtherance of the agreement was committed in this district.

 The government maintains that the indictment alleges eight overt acts committed in the District of Columbia in furtherance of the conspiracy. Seven involve false statements that Ms. Hsia allegedly caused the campaign committees to submit to the FEC, which is located in the District of Columbia. The remaining overt act involves a March 1996 visit by Ms. Hsia and representatives of the Temple to the White House, when they allegedly invited Vice President Gore to visit the Temple in California. See Indictment at PP 40(j), (m), (s), (v), (bb), (pp) & (y). Ms. Hsia contends that the seven false statements cannot be used as a basis for finding venue for the conspiracy count because neither the FEC nor the campaign committees -- the only entities acting in the District with regard to the false statements -- are alleged co-conspirators. She also argues that her visit to the White House was not an overt act in furtherance of the conspiracy. Ms. Hsia therefore seeks dismissal of the conspiracy count for lack of venue.

 1. False Statements as Bases for Venue

 Ms. Hsia concedes that venue for the false statement charges (Counts 2-6) is proper in the District of Columbia because venue in false statements cases is appropriate in any district to which the false statement ultimately is forwarded, even if by a person other than the defendant. See United States v. Bilzerian, 926 F.2d 1285, 1301 (2d Cir.), cert. denied, 502 U.S. 813, 116 L. Ed. 2d 39, 112 S. Ct. 63 (1991); United States v. Candella, 487 F.2d 1223, 1228 (2d Cir. 1973), cert. denied, 415 U.S. 977, 39 L. Ed. 2d 872, 94 S. Ct. 1563 (1974); United States v. Crop Growers Corp., 954 F. Supp. 335, 353 (D.D.C. 1997). Ms. Hsia argues, however, that the seven overt acts involving false statements cannot be used as the basis for venue for the conspiracy count because venue for conspiracy is appropriate only where one of the co-conspirators actually committed an overt act. She maintains that venue for conspiracy does not lie in this district because neither Ms. Hsia nor her alleged co-conspirators acted in the District of Columbia to cause the committee treasurers to submit false statements.

 Ms. Hsia's reading of the venue requirements for conspiracy is too narrow. Conspiracy is a continuing offense, and venue for continuing offenses is proper in any district in which the crime was begun, continued or completed. 18 U.S.C. § 3237(a). Because the submissions of the false statements to the FEC in the District of Columbia were foreseeable effects of Ms. Hsia's alleged overt acts in California, and because the submissions were necessary to the success of the alleged conspiracy to defraud the United States, venue is proper in the district in which the false statements were submitted. In United States v. Tannenbaum, checks were written in Manhattan but debited from an account in Brooklyn. The Second Circuit nevertheless found that venue was proper in the U.S. District Court for the Eastern District of New York in Brooklyn. "Although the checks were written in Manhattan, the actual debiting of the account -- which was not only foreseeable but, indeed, necessary to the success of the scheme -- occurred at [defendant's] bank in Brooklyn," and this was sufficient to establish venue for a conspiracy charge in that district. 934 F.2d at 12-13. While neither Ms. Hsia nor any of her co-conspirators did any act in the District of Columbia, she allegedly caused the overt act of submission of false statements to occur in the District of Columbia. The Court can see no difference between causing a check to be debited from a bank account and causing the campaign committee treasurers to submit false reports to the FEC. The overt acts involving false statements therefore are sufficient to establish venue in the District of Columbia. *fn6"

 2. White House Visit as Overt Act

 The government also has alleged as an overt act that in March 1996, Ms. Hsia and representatives from the Temple met with Vice President Gore at the White House. While there, they allegedly invited the Vice President to visit California and the Temple. Ms. Hsia argues that the White House visit cannot possibly be considered an overt act in furtherance of the conspiracy because it is not reasonable to infer from the allegations that the White House meeting advanced the conspiracy's goal of hiding the source of campaign contributions. While the connection between the alleged conspiracy and the White House visit appears tenuous, the Court does not agree that the visit cannot be an overt act in furtherance of the conspiracy. An overt act is "a concrete step toward carrying out the agreement, not one that actually accomplishes the goal[s] of the conspiracy." United States v. Sarault, 840 F.2d 1479, 1487 (9th Cir. 1988). Here, the visit to the White House might be considered a "concrete step" toward carrying out the agreement and an act in furtherance of the conspiracy to conceal the Temple's political contributions.

 The government maintains that the visit to the White House is an overt act in furtherance of the conspiracy because the invitation to the Vice President ultimately resulted in his attendance at the April 29, 1996 event at the Temple, for which the government alleges Ms. Hsia solicited and the Temple contributed unlawful conduit and corporate contributions. In light of this alleged connection, the Court concludes that the visit to the White House could be found to constitute an overt act in furtherance of the alleged conspiracy. Whether the White House incident was actually an act taken in furtherance of the conspiracy is a factual question for the jury to decide. The indictment adequately alleges that Ms. Hsia's visit to the White House was an overt act in furtherance of the conspiracy, and venue therefore is proper in the District of Columbia.

 III. MOTION TO STRIKE

 Ms. Hsia claims in Motion 8 that a number of words and phrases in the indictment are irrelevant and prejudicial, and she therefore requests that the Court exercise its discretion under Rule 7(d) of the Federal Rules of Criminal Procedure to strike these items from the indictment as surplusage. The words and phrases at issue are: (1) references to Ms. Hsia as "a/k/a Hsia Ling" in the caption and in paragraph 1 of the indictment; (2) references in Count 1 to contributions to candidates for state and local elections; (3) references in Count 1 to contributions to the DNC which Ms. Hsia characterizes as "soft money" contributions; (4) references in Count 1 to alleged acts of concealment or "cover-ups" as part of the alleged conspiracy; (5) references in Count 1 to President Clinton and Vice President Gore; (6) certain assertedly inflammatory words and phrases in Count 1, such as "unlawful," "secret, disguised and illegal," "illegal," "straw donors," "conduit," "long-standing pattern," "covered-up," and "falsely;" and (7) the words "among others" and "and elsewhere" in paragraph 40.

 In exercising the Court's authority to strike surplusage, "material that can fairly be described as 'surplus' may only be stricken if it is irrelevant and prejudicial." United States v. Oakar, 324 U.S. App. D.C. 104, 111 F.3d 146, 157 (D.C. Cir. 1997) (emphasis added). See also United States v. Watt, 911 F. Supp. 538, 554 (D.D.C. 1995). Since it is the practice of this Court to provide a copy of the indictment to the jury, inflammatory statements in the indictment that are not essential to allegations respecting the crimes charged may prejudice the defendant and should be stricken. Relevant language, however, "should not be stricken even if it may be prejudicial." See United States v. Weinberger, 1992 U.S. Dist. LEXIS 14534, Crim. No. 92-235, 1992 WL 294877, at * 7 (D.D.C. Sept. 29, 1992). Upon review of the words and phrases at issue, the Court concludes that some of the challenged items are both irrelevant and prejudicial and will be stricken; some do not meet the standard for striking surplusage and will be retained; and some cannot be resolved until the Court addresses Motions 3 (to Dismiss Count 1 of the Indictment for Failure to State an Offense under 18 U.S.C. § 371) and 7 (to Dismiss Counts 4 and 5 for Failure to State an Offense Under 18 U.S.C. §§ 2(b) and 1001 (Soft Money)) and will be retained pending disposition of those motions.

 Ms. Hsia challenges the use of the designation "a/k/a Hsia Ling" in the caption and in paragraph 1 of the indictment, the only two references to her by that name. "Hsia Ling" is the given name of Ms. Hsia, who was born in China. While "Hsia Ling" is not an alias in the traditional sense, the given name of a foreign-born defendant is somewhat analogous to an alias especially where, as here, the foreign name is preceded by "A/K/A." The use of aliases in indictments is disfavored, see United States v. Wilkerson, 456 F.2d 57, 59 (6th Cir.), cert. denied, 408 U.S. 926, 33 L. Ed. 2d 337, 92 S. Ct. 2507 (1972); United States v. Ramos, 839 F. Supp. 781, 787 (D. Kan. 1993), and aliases should only be retained when "the Government intends to introduce evidence of an alias and the use of that alias is necessary to identify the defendant in connection with the acts charged . . ." United States v. Clark, 541 F.2d 1016, 1018 (4th Cir. 1976).

 The Court agrees with Ms. Hsia that including both names in the indictment in this case is both unnecessary and prejudicial, and the references in the caption and in paragraph 1 of the indictment to "a/k/a Hsia Ling" therefore will be stricken. It is significant that there are no allegations in the 27-page indictment that refer to her by that name, suggesting that neither she nor any of her co-conspirators ever used the name Hsia Ling in connection with the acts charged in the indictment. At oral argument, however, the government stated that two of the documents it intends to introduce at trial refer to Ms. Hsia as Hsia Ling and that some government witnesses may know Ms. Hsia only as Hsia Ling. If those documents are relevant and otherwise admissible, the documents, including their references to "Hsia Ling," will be admitted. Similarly, if the witnesses who know Ms. Hsia only as Hsia Ling testify at trial, they may refer to her as Hsia Ling. The Court here holds only that the references to Hsia Ling in the caption and the introductory paragraph of the indictment are unnecessary and prejudicial.

 Ms. Hsia next challenges references in Count 1 to contributions that were made to candidates for state and local elections (PP 13(a), 14, 15, 29, 30, 40(f), (g), (w), (x)) and contributions to the DNC (PP 16, 17, 27, 28, 31-35, 40(h)-(j), (t)-(v), (z)-(ee)) that she characterizes as "soft money." She asserts that the FEC has no authority to regulate such contributions and such contributions therefore are irrelevant to the alleged conspiracy to defraud the United States by impeding the lawful functions of the FEC. The government counters that: (1) these contributions impeded the lawful functions of the INS, because the ban on political contributions by tax-exempt organizations is not limited to "hard money" contributions; and (2) in the case of the contributions to the DNC, the government intends to prove at trial that these were actually "hard money" contributions. Government's Opposition at 86-88. Ms. Hsia's assertions that (1) her alleged actions could not have impeded the INS; and (2) as a matter of law her contributions cannot be considered hard money are inescapably intertwined with her Motions 3 (to Dismiss Count 1 of the Indictment for Failure to State an Offense under 18 U.S.C. § 371) and 7 (to Dismiss Counts 4 and 5 for Failure to State an Offense Under 18 U.S.C. §§ 2(b) and 1001 ...


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