United States v. Rybicki - dissent

USA V RYBICKI
00-1043 (L), 00-1044, 00-1052, 00-1055
December 29, 2003

DENNIS JACOBS, Circuit Judge, joined by WALKER, Chief Judge,
CABRANES and PARKER, Circuit Judges, dissenting:

I agree with the majority that the appellants likely

forfeited their vagueness challenge, and that the issue is

one of plain error. The test for plain error is that there

must be (i) error, (ii) that is plain, (iii) that affects

substantial rights, and (iv) that seriously affects the

fairness, integrity, or public reputation of judicial

proceedings. This standard is satisfied here, applying the

analysis we employed in United States v. Thomas, 274 F.3d

655, 667 (2d Cir. 2001) (in banc). Certainly, conviction

under a statute that is unconstitutionally vague on its face

is an error of constitutional magnitude. See United States

v. Handakas, 286 F.3d 92, 111-12 (2d Cir.), cert. denied,

537 U.S. 894 (2002). Reaching the merits, I respectfully

dissent because in my view the so-called “honest services”

amendment to the wire and mail fraud statute, 18 U.S.C. §

1346, flunks the test for facial vagueness set forth by the

Supreme Court in City of Chicago v. Morales, 527 U.S. 41

(1999).
1
 I

The test for facial invalidity of a criminal statute

was articulated by the Supreme Court in 1999: “Vagueness

may invalidate a criminal law for either of two independent

reasons. First, it may fail to provide the kind of notice

that will enable ordinary people to understand what conduct

it prohibits; second, it may authorize and even encourage

arbitrary and discriminatory enforcement.” Id. at 56

(Stevens, J., writing for the Court, joined by Ginsburg and

Souter, JJ.); accord id. at 64-65 (O’Connor, J., concurring

in part and concurring in the judgment, joined by Breyer,

J.); see also Kolender v. Lawson, 461 U.S. 352, 357 (1983).

The majority opinion states that the governing standard

for facial challenges outside of the First Amendment context

is to be drawn from United States v. Salerno, 481 U.S. 739

(1987), which states in dicta that a statute is facially

invalid only if there is “no set of circumstances” in which

it would be valid. Id. at 745. The majority’s expressed

preference for the 1987 Salerno dicta over the 1999 Morales

holding is itself a bit of dicta because the majority holds
2
that the statute in question survives scrutiny under either

test. [Maj. Op. at 40] Although I believe that section

1346 is so vague that there is “no set of circumstances” in

which it is clear enough to be applicable, I think that the

test does matter, chiefly to assure a sound analysis of

constitutional sufficiency. I therefore undertake to

demonstrate that the governing test is the one set forth in

Morales.

At most, four Justices in Morales invoked the Salerno

test for facial vagueness or words suggestive of that

standard. See Morales, 527 U.S. at 77-81 & nn.1-3 (Scalia,

J., dissenting); id. at 111-12, 114 (Thomas, J., dissenting,

joined by Rehnquist, C.J., and Scalia, J.); id. at 71

(Breyer, J., concurring in part and concurring in the

judgment) (“The ordinance is unconstitutional . . . because

the policeman enjoys too much discretion in every case. And

if every application of the ordinance represents an exercise

of unlimited discretion, then the ordinance is invalid in

all its applications.”). In any event, Morales did not

implement the Salerno dicta. See id. at 81 (Scalia, J.,

dissenting) (“Instead of requiring respondents, who are

challenging the ordinance, to show that it is invalid in all
3
its applications, [the Justices in the majority] have

required [the government] to show that it is valid in all

its applications.”).

It is true, of course, that several other propositions

discussed in Morales only attracted a plurality. As the

majority opinion notes, a three-Justice plurality of the

Morales court would apparently allow challenges for facial

vagueness outside of the First Amendment context to criminal

laws that both lack a mens rea requirement and infringe on

constitutional rights. See id. at 55 (Stevens, J., writing

for the Court, joined by Ginsburg and Souter, JJ.); [Maj.

Op. at 13] However, only those same three Justices believed

that the ordinance challenged in Morales implicated such a

constitutional right and lacked a specific intent

requirement. Compare id. at 55 (Stevens, J., writing for

the Court, joined by Ginsburg and Souter, JJ.) (“[The

challenged statute] is a criminal law that contains no mens

rea requirement and infringes on constitutionally protected

rights.”) (internal citations omitted), with id. at 66

(O’Connor, J., concurring in part and concurring in the

judgment, joined by Breyer, J.) (“To be sure, there is no

violation of the ordinance unless a person fails to obey
4
promptly the order to disperse. But, a police officer

cannot issue a dispersal order until he decides that a

person is remaining in one place ‘with no apparent purpose’

and the ordinance provides no guidance to the officer on how

to make this antecedent decision.”) and id. at 69 (Kennedy,

J., concurring in part and concurring in the judgment)

(noting that the ordinance “reach[ed] a broad range of

innocent conduct” and stating that “[t]he predicate of an

order to disperse is not, in my view, sufficient to

eliminate doubts regarding the adequacy of notice under this

ordinance.”). Thus, three of the six Justices supporting

the result in Morales (Justices O’Connor, Kennedy, and

Breyer) applied the Morales test outside the First Amendment

context without regard to whether the statute had an intent

requirement or infringed on a constitutional right.

Certainly, none of these propositions nor the invocation of

the Salerno standard--each attracting only a plurality in

Morales--constitutes Supreme Court precedent.

The only proposition attracting a majority in Morales

was that a criminal statute that “reach[es] a substantial

amount of innocent conduct” and thereby fails to “establish

minimal guidelines to govern law enforcement” is, on its
5
face, unconstitutionally vague. Id. at 60-61 (Stevens, J.,

writing for the Court in part V, joined by Ginsburg and

Souter, JJ.), id. at 69 (Kennedy, J., joining in part V,

concurring in part and concurring in the judgment); see also

id. at 64-65 (O’Connor, J., concurring in part and

concurring in the judgment, joined by Breyer, J.).

We are therefore required to apply Morales here.

Although the majority holds that section 1346 withstands

either test, it is quite clear that the statute imposes

insufficient constraint on prosecutors, gives insufficient

guidance to judges, and affords insufficient notice to

defendants. That insufficiency can be illustrated by

reference to the cases cited in the majority opinion. As to

prosecutors, the majority does not disturb the holding that

overturned the conviction in Handakas, 286 F.3d at 96, of a

contractor who falsely promised to abide by New York’s wage

laws, on the ground that the “honest services” amendment was

vague as applied. The majority opinion thus confirms that

the prosecution in Handakas was misguided, or (in my view)

that prosecutorial discretion was unguided altogether

because the statute insufficiently describes the offense.

The majority opinion similarly demonstrates that judges
6
cannot understand what conduct this statute criminalizes.

The majority holds that case law predating McNally v. United

States, 483 U.S. 350 (1987), is relevant to determining the

meaning of section 1346 and thus rejects the contrary rule

announced in United States v. Sancho, 157 F.3d 918, 922 (2d

Cir. 1998) (per curiam); the majority holds that reasonable

foreseeability of non-de minimis economic or pecuniary harm

is not a necessary element of the crime and thus rejects the

panel’s contrary holding in United States v. Rybicki, 287

F.3d 257, 265-66 (2d Cir. 2002); and the majority rejects

the view expressed in Handakas that the statute is facially

vague (though that panel was constrained by Circuit

precedent from so holding). 286 F.3d at 104-06. In short,

if the statute means what the majority says it means, eight

judges in this Circuit failed to understand it in Sancho,

Handakas, and Rybicki. Of course, overturned convictions

and in banc rejection of panel rulings do not prove facial

vagueness. But this Circuit’s long experience with section

1346 is nevertheless telling evidence that most lawyers and

judges, not to speak of ordinary laymen or prospective

defendants, cannot be expected to understand the statute.

II
7
 The first question that bears on the vagueness inquiry

is whether “a penal statute define[s] the criminal offense

with sufficient definiteness that ordinary people can

understand what conduct is prohibited.” Kolender, 461 U.S.

at 357. “The plain meaning of ‘honest services’ in the text

of § 1346 simply provides no clue to the public or the

courts as to what conduct is prohibited under the statute.”

Handakas, 286 F.3d at 104. The majority opinion is a

prolonged and sustained search for some prior settled

meaning for an opaque statutory phrase--“the intangible

right of honest services”--so that it can be construed as a

term of art. That effort to infuse the putative term of art

with meaning is conducted in a painstaking way, and

considers an abundant variety of alternative meanings.

However, a term of art has one single and apparent meaning,

in the same way that a pun has two; it is as odd to conduct

a scholarly search for the meaning of a term of art as it

would be to hear a pun, conduct research in semantics,

etymology and philology for a month, and then laugh.

It may be (as the majority holds) that, in enacting

section 1346, Congress intended to reinstate a body of case

law that had been overruled by the Supreme Court in McNally.
8
See Handakas, 286 F.3d at 103, 104-05 (citing legislative

history). But that insight gets us nowhere in terms of

limits on prosecutorial power and notice to the public:

The requirement imposed by the Supreme Court [in
McNally] to speak more clearly was not for the
benefit of the Circuit Courts which had, in fact,
given birth to these concepts in the first place.
Rather, the requirement . . . was for the benefit
of the public, the average citizen, . . . who must
be forewarned and given notice that certain
conduct may subject him to federal prosecution.

United States v. Brumley, 116 F.3d 728, 745-46 (5th Cir.

1997) (in banc) (Jolly, J., dissenting) (emphasis added). A

statute is unconstitutionally vague unless it provides a

“person of ordinary intelligence a reasonable opportunity to

know what is prohibited.” United States v. Strauss, 999

F.2d 692, 697 (2d Cir. 1993) (internal quotation marks

omitted). We have held that notice is insufficient if lay

persons are required to “perform[] the lawyer-like task of

statutory interpretation by reconciling the text of []

separate documents.” Chatin v. Coombe, 186 F.3d 82, 89 (2d

Cir. 1999) (invalidating a prison administrative prohibition

as unconstitutionally vague as applied). Construing a

statute (as the majority does here) to say that scores of

overruled cases are hereby revived, requires lay persons to

9
do lawyer-like tasks that few lawyers would have the skills

to perform:

[N]o one can know what is forbidden by § 1346
without undertaking the “lawyer-like task” of
answering the following questions: [1] Can pre-
McNally case law be consulted to illuminate the
wording of § 1346? [2] Can any meaning be drawn
from the case law, either the uneven pre-McNally
cases or the few cases decided post-§ 1346? [3] Is
one to be guided only by case law within one’s own
circuit, or by the law of the circuits taken
together (if that is possible)?

Handakas, 286 F.3d at 105.

It is remarkable how little the majority’s search for

meaning has turned up. The term of art for which meaning is

sought is essentially the entire mouthful of the statute:

“scheme or artifice to deprive another of the intangible

right of honest services.” Before McNally, this phrase

encompassed four “categories” of honest-services cases:

[1] government officials who defraud the public of
their own honest services; [2] elected officials and
campaign workers who falsify votes and thereby defraud
the electorate of the right to an honest election; [3]
private actors who abuse fiduciary duties by, for
example, taking bribes; and [4] private actors who
defraud others of certain intangible rights, such as
privacy.

Id. at 101-02 (citing McNally, 483 U.S. at 362-64 nn.1-4).

Yet the majority’s search for meaning bears upon no more

than one subgroup of the four categories of honest-services
10
cases.

Following an exhaustive, scholarly analysis, my

colleagues conclude that one of these four categories of

conduct criminalized by pre-McNally case law--the theft of

privacy rights--cannot be revived as a criminal offense,

presumably because the statute would be unconstitutionally

vague under Salerno as well as Morales if so applied. [Maj.

Op. at 28-29 n.13] Contra United States v. Condolon, 600

F.2d 7, 8-9 (4th Cir. 1979); United States v. Louderman, 576

F.2d 1383, 1387-88 (9th Cir. 1978). They also limit their

search for meaning to cases of “honest services” fraud in

the private sector. No attempt is made (advisedly) to

describe the prohibition, if any, in the two remaining

categories of public sector “honest services” fraud

criminalized in the pre-McNally case law; any “well-settled

meaning” relating to these remaining categories will

presumably be supplied--or looked for--later.

The majority intuits a statutory meaning that is

insufficient even to describe the subgroup of private sector

cases. Where kickbacks or bribery are involved, the

majority holds that a “scheme or artifice to deprive another

of the intangible right of honest services” means:
11
 a scheme or artifice to use the mails or wires to
enable an officer or employee of a private entity
(or a person in a relationship that gives rise to
a duty of loyalty comparable to that owed by
employees to employers) purporting to act for and
in the interests of his or her employer (or of the
other person to whom the duty of loyalty is owed)
secretly to act in his or her or the defendant’s
own interests instead, accompanied by a material
misrepresentation made or omission of information
disclosed to the employer or other person.

[Maj. Op. at 35-36.] However, in cases of self-dealing,

there “may” be an additional requirement that the alleged

conduct “caused, or at least was capable of causing, some

detriment” to the employer. [Maj. Op. at 38] (emphasis

added). The tentativeness of the majority’s approach is

well justified: a number of pre-McNally cases hold that

there is no such requirement of economic detriment. See,

e.g., United States v. Bronston, 658 F.2d 920, 927 (2d Cir.

1981) (upholding mail fraud conviction against a law firm

partner paid for representing a client in contract

negotiation despite firm representing competing bidder); see

also Rybicki, 287 F.3d at 262 (“[I]t was well-settled law

both before and after McNally that the government does not

have to establish that a scheme to defraud was successful or

resulted in any actual [economic] harm to the victim.”).

[Maj. Op. at 36 n. 18.] The majority deems such cases
12
“atypical,” however. They may be atypical; but even

assuming that a term of art can be distilled from the body

of case law that was overruled in McNally, surely no

unambiguous meaning can be assigned to a phrase that has no

meaning except what can be distilled from some pre-McNally

cases provided that other pre-McNally cases are ignored,

particularly since the designation of overruled cases that

are in and those that are out is itself essentially

arbitrary. Ordinary people cannot be expected to undertake

such an analysis; rare is the lawyer who could do it; and no

two lawyers could be expected to agree independently on the

elements of an offense that must be defined by such a

project.

The majority claims that any ambiguity is of no concern

here because defendants’ conduct falls “squarely within the

meaning of ‘scheme or artifice to deprive another of the

intangible right of honest services’ as distilled from the

pre-McNally private sector cases.” [Maj. Op. at 38.] But

this argument is no answer to a facial challenge for

vagueness. The only relevant question is whether “ordinary

people can understand what conduct is prohibited.”

Kolender, 461 U.S. at 357.
13
 It is only too obvious that there is no settled meaning

to the phrase “the intangible right of honest services” that

is capable of providing constitutionally adequate notice.

If there were, the judges and prosecutors in this Circuit

would certainly know it. Yet, the majority overrules the

holding (erroneously characterized as dicta) in Sancho, 157

F.3d at 922, that pre-McNally case law is irrelevant to

determining the meaning of section 1346--i.e., that “the

intangible right of honest services” lacks a well settled

meaning. The majority also concludes that the panel opinion

in this case was wrongly decided insofar as it held that one

element of a section 1346 offense is that a loss of money or

property be reasonably foreseeable. See Rybicki, 287 F.3d

at 265-66. Finally, the majority preserves the holding of

Handakas, 286 F.3d at 96, which means that the prosecutors

in the Eastern District of New York did not understand what

the statute meant. How can the public be expected to know

what the statute means when the judges and prosecutors

themselves do not know, or must make it up as they go along?

III

The second question that bears on facial vagueness is
14
whether the “legislature [has] establish[ed] minimal

guidelines to govern law enforcement.” Kolender, 461 U.S.

at 358. This second inquiry is “the more important” of the

two, and is alone sufficient to decide constitutional

infirmity. Id. at 358, 361 & n.10. The governing test is

whether the statute “permit[s] ‘a standardless sweep [that]

allows policemen, prosecutors, and juries to pursue their

personal predilections.’” Id. at 358 (second alteration in

original). “An enactment fails to provide sufficiently

explicit standards for those who apply it when it

impermissibly delegates basic policy matters to policemen,

judges and juries for resolution on an ad hoc and subjective

basis.” Handakas, 286 F.3d at 107 (internal quotation marks

and citations omitted). Thus, a statute is facially vague

if it “necessarily entrusts lawmaking to the moment-to-

moment judgment” of law enforcement. Morales, 527 U.S. at

60 (Stevens, J., writing for the majority) (internal

quotation marks omitted).

The majority opinion affirms the result in Handakas,

which means (as I pointed out earlier) that the prosecutors

in the Eastern District of New York did not understand what

the statute meant. Moreover, the meaning supplied by the
15
majority to uphold this use of section 1346 is as elusive as

the statute itself. According to the majority, the “honest

services” offense is a misrepresentation or omission that

(i) is made by a private person who secretly acts in self-

interest while purporting to act in the interests of the

employer and (ii) is capable of leading a reasonable

employer to change its conduct (i.e., it is “material”).

[Maj. Op. at 37-38] Neither requirement limits

prosecutorial discretion.

No limit is placed on the exercise of prosecutorial

discretion by requiring a showing that an employee secretly

prefers her own interest to the interest of the employer; it

is naive to assume that this preference is not the most

common premise of private employment. “[R]elationships in

the private sector generally rest upon concerns and

expectations less ethereal and more economic than abstract

satisfaction of receiving ‘honest services’ for their own

sake.” United States v. Frost, 125 F.3d 346, 365 (6th Cir.

1997). Every salaried employee can be said to work for her

own interest while purporting to act in the interests of the

employer. Yet the majority opinion effectively makes

“dishonesty by an employee, standing alone, [] a crime.”
16
Id. at 368.

Nor is prosecutorial discretion limited by the

“materiality” requirement See United States v. Sun-Diamond

Growers, 138 F.3d 961, 973 (D.C. Cir. 1998) (“Every material

act of dishonesty by an employee deprives the employer of

that worker’s ‘honest services,’ yet not every such act is

converted into a federal crime by the mere use of the mails

or interstate phone system.”); Frost, 125 F.3d at 365 (in

rejecting the materiality test: “[I]f a ‘change in business

conduct’ occurs under the materiality standard when a

business alters its behavior merely to avoid the appearance

of impropriety . . . , the intangible right to honest

services doctrine may lack substantive limits in the private

sector.”) (emphasis in original).

The majority codifies a doctrine that is as

standardless as the statute itself. Nothing in the majority

opinion prevents criminalization of any of the following

conduct: a regulated company that employs a political

spouse; an employee who violates an employee code of

conduct; a lawyer who provides sky-box tickets to a client’s

general counsel; a trustee who makes a self-dealing

investment that pays off; or an officeholder who has made a
17
decision in order to please a constituent or contributor, or

to promote re-election, rather than for the public good (as

some prosecutor may see the public good).

The majority is unconcerned with the standardless

sweep of the statute because supposedly there is “a wide

swath of behavior” for which the prohibitions of section

1346 are “clear.” [Maj. Op. at 40] This statement turns

upside down the Morales test for facial vagueness: whether

a statute reaches a wide swath of behavior that no one (yet)

deems criminal and fails to provide minimal guidance to law

enforcement. See Morales, 527 U.S. at 60 (Stevens, J.,

writing for the majority). “‘It would certainly be

dangerous 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.’” Kolender, 461 U.S. at 358 n.7

(quoting United States v. Reese, 92 U.S. 214, 221 (1875)).

I share the confidence implicit in the majority opinion that

prosecutors in this Circuit and the Attorney General under

whom they serve can be trusted to avoid any systematic abuse

of such a statute; but we should construe this statute so

that it serves to bind those who nevertheless may need
18
constraint. 1

IV

The majority opinion’s search for a meaning of art

leans heavily on the overruled pre-McNally case law of other

circuits. But “[e]ven the circuits that have reinstated

pre-McNally law recognize that ad hoc parameters are needed

to give the statute shape.” Handakas, 286 F.3d at 109

(collecting cases). Although a number of circuits have

upheld section 1346 against a claim of facial vagueness,

there is now wide disagreement among the circuits as to the

elements of the “honest services” offense. These opinions,

1
The majority ultimately relies on the reductionist
argument that these defendants must have known that it would
be illegal “to use the wires and the mails . . . to pay off
insurance adjustors.” [Maj. Op. at 37] The natural drift
of this observation is that the scheme inflated the
settlement of claims to the benefit of the defendants’
clients and to the detriment of the insurance companies.
However, the government never contended that this occurred.
As the majority opinion recites, “the government
acknowledged that it would not seek to prove that the amount
of any of the settlements connected with a payment to an
adjuster had been inflated above what would have been a
reasonable range for that settlement.” [Maj. Op. at 6]
There was certainly no reason for these defendants to
believe that the gratuities at issue--which the government
never contended caused a loss--amounted to a federal mail or
wire fraud violation.

19
taken together, refute rather than support the idea that

section 1346 has any settled or ascertainable meaning or

that the offense it describes has known contours:

• What mens rea must be proved by the

government? The majority follows Second

Circuit precedent in holding that an intent to

cause economic harm is not required--a

defendant need only have intended to deprive

another of the “intangible right of honest

services.” [Maj. Op. at 43] However, in the

Seventh Circuit, an intent to achieve personal

gain is an element of the offense. See United

States v. Bloom, 149 F.3d 649, 656-57 (7th

Cir. 1998). But see United States v. Welch,

327 F.3d 1081, 1106-07 (10th Cir. 2003)

(holding that the text and structure of the

mail fraud statutes do not support “adding an

element” to “honest services” fraud requiring

that defendant seek to obtain a personal

benefit). The Eight Circuit describes the

mens rea element as “caus[ing] or intend[ing]

to cause actual harm or injury, and in most
20
 business contexts, that means financial or

economic harm.” See United States v.

Pennington, 168 F.3d 1060, 1065 (8th Cir.

1999). One circuit has held that, to secure

an honest services conviction, “[t]he

prosecution must prove that the employee

intended to breach a fiduciary duty.” Frost,

125 F.3d at 368. Other circuits merely

require a showing of “fraudulent intent.” See

United States v. Cochran, 109 F.3d 660, 667

(10th Cir. 1997); United States v. Jain, 93

F.3d 436, 442 (8th Cir. 1996).

• Must the defendant have caused actual tangible

harm? Compare Jain, 93 F.3d at 442 (“When

there is no tangible harm to the victim of a

private scheme, it is hard to discern what

intangible ‘rights’ have been violated.”),

with Frost, 125 F.3d at 369 (“[A] defendant

accused of scheming to deprive another of

honest services does not have to intend to

inflict an economic harm upon the victim.”).

Some circuits have required that the
21
 misrepresentation be material, i.e., that the

employee have reason to believe that the

information would lead a reasonable employer

to change its business conduct. See Cochran,

109 F.3d at 667 & n.3; United States v. Gray,

96 F.3d 769, 775 (5th Cir. 1996); Jain, 93

F.3d at 442. Other circuits only require a

showing that it was reasonably foreseeable for

the victim to suffer economic harm. Frost,

125 F.3d at 368; Sun-Diamond Growers, 138 F.3d

at 973-74. We adopted this last requirement

in the Rybicki panel opinion, and now abandon

it. See Rybicki, 287 F.3d at 265.

• What is the duty that must be breached to

violate section 1346? The majority holds that

it is the duty owed by an employee to an

employer, or by “a person in a relationship

that gives rise to a duty of loyalty

comparable to that owed by employees to

employers” (whatever that means). [Maj Op. at

34-35] Some circuits only allow prosecutions

for breach of an employee’s duty to an
22
 employer. See, e.g., Brumley, 116 F.3d at

735. Other circuits require the breach of a

fiduciary duty. See Frost, 125 F.3d at 366,

368; Sun-Diamond Growers, 138 F.3d at 974.

• Is the source of that duty state or federal

law? The majority does not say, and other

circuits are split. Compare Frost, 125 F.3d

at 366 (“Federal law governs the existence of

fiduciary duty under the mail fraud statute.”

(emphasis added)), with Brumley, 116 F.3d at

735 (“We have held that services under § 1346

are those an employee must provide the

employer under state law.” (emphasis added)).

• Did section 1346 revive pre-McNally case law;

if so must each circuit look to its own

governing precedent or to some set of rules

distilled from the whole body of pre-McNally

cases? See Brumley, 116 F.3d at 733-34

(looking to “plain language” of a statute to

discern its “meaning” because “before McNally

the doctrine of honest services was not a

unified set of rules [a]nd Congress could not
23
 have intended to bless each and every pre-

McNally lower court ‘honest services’

opinion”); Frost, 125 F.3d at 364, 365

(holding that Ҥ 1346 has restored the mail

fraud statute to its pre-McNally scope,

according to previous opinions interpreting

the intangible right to honest services” and

looking to “Sixth Circuit precedent issued

before McNally in order to discover the

precise contours of the right in this

circuit”). In Sancho, we held that pre-

McNally cases could not be considered in

determining the meaning of the statute. See

157 F.3d at 921-22. We now overrule Sancho

and adopt an approach divining statutory

meaning by analyzing cases overruled by

McNally as a whole.

In sum, the circuits are fractured on the basic issues:

(1) the requisite mens rea to commit the crime, (2) whether

the defendant must cause actual tangible harm, (3) the duty

that must be breached, (4) the source of that duty, and (5)

which body of law informs us of the statute’s meaning. This
24
lack of coherence has created “a truly extraordinary

statute, in which the substantive force of the statute

varie[s] in each judicial circuit.” Brumley, 116 F.3d at

743 n.7 (Jolly, J., dissenting).

V

As the foregoing section documents, the vagueness of

the statute has induced court after court to undertake a

rescue operation by fashioning something that (if enacted)

would withstand a vagueness challenge. The felt need to do

that attests to the constitutional weakness of section 1346

as written. And the result of all these efforts--which has

been to create different prohibitions and offenses in

different circuits--confirms that the weakness is fatal.

Judicial invention cannot save a statute from

unconstitutional vagueness; courts should not try to fill

out a statute that makes it an offense to “intentionally

cause harm to another,” or to “stray from the straight and

narrow,” or to fail to render “honest services.”

“[L]egislatures and not courts should define criminal

activity.” United States v. Bass, 404 U.S. 336, 348 (1971);

see also Handakas, 286 F.3d at 101 (punishment for
25
“constructive offenses” violates the Due Process Clauses of

the Fifth and Fourteenth Amendments, which “require the

legislature to specify the elements of criminal offenses”);

Bloom, 149 F.3d at 654 (describing “a federal common-law

crime” as “a beastie that many decisions say cannot exist”).

As the splintering among the circuits demonstrates, section

1346 effectively imposes upon courts a role they cannot

perform. When courts undertake to engage in legislative

drafting, the process takes decades and the work is

performed by unelected officials without the requisite

skills or expertise; and as the statutory meaning is

invented and accreted, prosecutors are unconstrained and

people go to jail for inchoate offenses.

The majority complacently cites by analogy similarly

vague words in the Sherman Act that make unlawful any

“restraint of trade.” [Maj. Op. at 27] The Sherman Act

predates Morales by a century. Moreover, the comparison

proves too much. Courts construe the Sherman Act primarily

as a civil and regulatory statute, and criminal Sherman Act

prosecutions have long been limited essentially to price-

fixing. In keeping with its exceptional history, courts

have broadly construed the Sherman Act as “a charter of
26
freedom” akin to constitutional provisions. See, e.g.,

United States v. U.S. Gypsum Co., 438 U.S. 422, 439 (1978)

(“Simply put, the Act has not been interpreted as if it were

primarily a criminal statute; it has been construed to have

a ‘generality and adaptability comparable to that found to

be desirable in constitutional provisions.’”) (citation

omitted)); 2 Phillip E. Areeda, Herbert Hovenkamp & Roger D.

Blair, Antitrust Law § 303b4, at 33 (2d ed. 2000) (“Because

they were usually dealing with civil proceedings, the courts

have implicitly understood the Sherman Act as a mandate to

develop a common law of antitrust--as indeed it would have

to be in order to fulfill its purpose as a ‘charter of

freedom.’”). The analogy to antitrust law is valid only

insofar as section 1346 is an invitation by Congress for

courts to develop a common law of criminal punishment.

Finally, “[t]he absence of discernible standards in the

‘honest services’ doctrine implicates principles of

federalism.” Handakas, 286 F.3d at 110. The majority

opinion in effect criminalizes all material acts of

dishonesty by employees or by persons who owe analogous

duties. While the majority opinion concerns itself only

with private sector “honest services” fraud, there seems to
27
be no principled basis in the statute’s wording or in

(overruled) cases for excluding from section 1346's reach

services rendered in the public sector. Thus, without any

obvious limiting principles, the majority opinion invites

federal prosecutors to police honesty in the corridors of

state government by invoking section 1346 against state

employees for their acts of “honest services” fraud. This

construction of section 1346 undoubtedly “leaves its outer

boundaries ambiguous and involves the Federal Government in

setting standards of disclosure and good government for

local and state officials.” McNally, 483 U.S. at 360.

I believe that Congress has not heeded the Supreme

Court’s admonition to “speak more clearly than it has.” See

id. We should not “approve a sweeping expansion of federal

criminal jurisdiction in the absence of a clear statement by

Congress.” Cleveland v. United States, 531 U.S. 12, 24

(2000).

The majority opinion exhibits deference to Congress by

conscientiously seeking to understand congressional intent,

and the effort and product are scholarly and scrupulous.

But the work accomplished by the majority opinion, which is

admirable in its way, is properly the work of legislators in
28
statutory drafting and the work of the executive in framing

prosecutorial standards. “If the words of a criminal

statute insufficiently define the offense, it is no part of

deference to Congress for us to intuit or invent the crime.”

Handakas, 286 F.3d at 109-10. I respectfully dissent.

29