IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
January 10, 2008
Nos. 05-20604 Charles R. Fulbruge III
Clerk
UNITED STATES OF AMERICA
Plaintiff-Appellee
v.
DAVID KAY; DOUGLAS MURPHY
Defendants-Appellants
Appeals from the United States District Court
for the Southern District of Texas
ORDER ON PETITION FOR REHEARING
(Opinion October 24, 2007, 5th Cir. 2007 ___F.3d____)
Before HIGGINBOTHAM, BARKSDALE, and CLEMENT, Circuit Judges.
PATRICK E. HIGGINBOTHAM, Circuit Judge.
I
David Kay and Douglas Murphy, executives of American Rice, Inc., were
indicted for bribing Haitian officials in violation of the Foreign Corrupt Practices
Act (FCPA). The district court dismissed the indictment, finding that the FCPA
did not apply to Defendants’ conduct. We held that the bribes alleged in the
indictment could fall within the scope of the FCPA and remanded. On remand,
Kay and Murphy were convicted on all counts. They appealed, and we affirmed
their convictions. Defendants filed a Petition for Rehearing En Banc.
No. 05-20604
No member of the panel nor judge in regular active service of the court
having requested that the court be polled on Rehearing En Banc (FED. R. APP.
P. and 5th Cir. R. 35), the Petition for Rehearing En Banc is DENIED. Treating
the Petition for Rehearing En Banc as a Petition for Panel Rehearing, the
Petition for Panel Rehearing is also DENIED for the reasons that follow.
II
Defendants argue that the district court abused its discretion in
instructing the jury on intent, urging that it gave a general intent instruction.
Ultimately, labels aside, the issue reduces to the question of whether the jury
was required to find that Defendants knew that their conduct was not legal.
With that focus, we point to the charge and the arguments.
The jury instructions for the second element of the charge – “corruptly” –
stated,
An act is “corruptly” done if done voluntarily and intentionally, and
with a bad purpose or evil motive of accomplishing either an
unlawful end or result, or a lawful end or result by some unlawful
method or means.1 The term “corruptly” is intended to connote that
1
The instructions’ language requiring “bad purpose” or “evil motive” suggests
knowledge of unlawfulness. See, e.g., Bryan v. United States, 524 U.S. 184, 191-92 (1998) (“As
a general matter, when used in the criminal context, a ‘willful’ act is one undertaken with a
‘bad purpose’ . . . In other words, in order to establish a ‘willful’ violation of a statute, ‘the
Government must prove that the defendant acted with knowledge that his conduct was
unlawful.’” (emphasis added)); see also id. at 193 (“With respect to the . . . conduct . . . that is
only criminal when done ‘willfully.’ . . . The jury must find that the defendant acted with an
evil-meaning mind, that is to say, that he acted with knowledge that his conduct was
unlawful.”); Cheek v. United States, 498 U.S. 192, 200 (1991) (for the strictest level of intent
in the tax context, the Supreme Court “described the term ‘willfully’ as connoting ‘a voluntary,
intentional violation of a known legal duty,’ and did so with specific reference to the ‘bad faith
or evil intent’ language” (emphasis added)). But as indicated by Bryan and Cheek, instructions
requiring knowledge of unlawfulness also typically include language specifically requiring an
intent to violate the law. According to the Fifth Circuit’s pattern instructions, the historical
definition of willfully “means that the act was committed voluntarily and purposely, with the
2
No. 05-20604
the offer, payment, and promise was intended to induce the
recipient to misuse his official position.2
Regardless of whether the jury instruction that Defendants contest would alone
be a sufficient platform requiring unlawfulness, “jury instructions are to be
judged as a whole, rather than by picking isolated phrases from them.”3 When
reviewing the jury’s understanding of the charge, we look to the total context of
the trial, with the benefit of arguments by all counsel.4 In this case, the court’s
instructions as a whole and considered in the context of trial required a finding
that Defendants knew that their conduct was unlawful.
In addition to the requirement of corrupt intent, the indictment made the
usual charges of aiding and abetting under 18 U.S.C. § 2, which provides,
specific intent to do something the law forbids’ that is to say, with bad purpose either to
disobey or disregard the law.” Fifth Circuit Pattern Jury Instructions (Criminal Cases) § 1.38
(2001). Those instructions acknowledge that “this definition is not accurate in every situation”
and that “the term ‘willfully’ has ‘defied any consistent interpretation by the courts.’” Id.
(quoting United States v. Granda, 565 F.2d 922, 924 (5th Cir. 1978)). In this case, we look to
the jury instructions as a whole and the context of trial to ensure that the instructions
adequately conveyed a requirement that the Government must prove that Defendants knew
that their conduct was not legal – “unlawfulness.”
2
Emphasis added.
3
Hamling v. United States, 418 U.S. 87, 107-08 (1974).
4
See, e.g., Cupp v. Naughten, 414 U.S. 141, 146-47 (1973) (“[W]e accept at the outset
the well-established proposition that a single instruction to a jury may not be judged in
artificial isolation, but must be viewed in the context of the overall charge. While this does not
mean that an instruction by itself may never rise to the level of constitutional error, it does
recognize that a judgment of conviction is commonly the culmination of a trial which includes
testimony of witnesses, argument of counsel, receipt of exhibits in evidence, and instruction
of the jury by the judge. Thus not only is the challenged instruction but one of many such
instructions, but the process of instruction itself is but one of several components of the trial
which may result in the judgment of conviction.” (citations omitted)).
3
No. 05-20604
(a) Whoever commits an offense against the United States or aids,
abets, counsels, commands, induces or procures its commission, is
punishable as a principal.
(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.
In its instructions on aiding and abetting, before it instructed the jury on specific
elements of the crime, the court insisted on a finding of “intent to violate the
law,” stating,
[Y]ou may not find any defendant guilty unless you find beyond a
reasonable doubt that every element of the offense, as defined in
these instructions, was committed by some person or persons and
that the defendant voluntarily participated in its commission with
the intent to violate the law.
The jury was also instructed, “It is further the theory of [Defendants Kay and
Murphy, respectively] that [they] never acted with corrupt intent in
participating in the authorization of payments to customs officials” and that the
“defense[] is valid under the law.”
Also key to our holding are the closing arguments of both Government and
Defense counsel. The requisite intent here only requires knowledge that one is
doing something unlawful, and neither side suggested to the jury that
Defendants could be convicted if there was a reasonable doubt of their
knowledge of the “unlawfulness” of their conduct.5 Kay’s counsel in closing
5
Compare Cheek, 498 U.S. at 199-200 (“The proliferation of statutes and regulations
has sometimes made it difficult for the average citizen to know and comprehend the extent of
the duties and obligations imposed by the tax laws. Congress has accordingly softened the
impact of the common-law presumption by making specific intent to violate the law an element
of certain federal criminal tax offenses. Thus, the Court almost 60 years ago interpreted the
4
No. 05-20604
argument focused on the FCPA when addressing corrupt intent and argued that
Kay was unaware of the FCPA, stating,
And I’d ask that you turn to page 17 [including the instructions on
corrupt intent]. “An act is ‘corruptly’ done if done voluntarily and
intentionally and with a bad purpose or evil motive” – full stop. Full
stop. Here’s where the rubber meets the road. This is what you’re
going to have to decide. Did the man that you saw on the witness
stand, did the man that you heard about in this trial act “with a bad
purpose or an evil motive of accomplishing either an unlawful end
or result or a lawful end” – “by unlawful method or means?” This is
more than doing something bad. This is somebody acting with a bad
purpose or evil motive to accomplish something unlawful. This is
somebody who wants to do something unlawful.
“The term ‘corruptly’ is intended to connote that the offer, payment,
or promise was intended to induce the recipient to misuse his official
position.” We don’t think he acted evilly; we don’t think he acted
badly; we don’t think he was intending to do something unlawful;
and we don’t think he was trying to get customs to misuse their
positions. He was trying to get customs to do what customs should
have done.
One thing that undoubtedly will come up is David’s familiarity or
lack of familiarity with the statute. And, obviously, he testified that
he didn’t have a clue that his conduct was violative of any federal
law. Where in his life, when in his life would he have become
familiar with the FCPA?
....
An interesting piece about Theriot, their star witness. Theriot, of
course testified, well, he was in a meeting in Houston and they
passed out a document that everybody signed and everybody signed
statutory term ‘willfully’ as used in the federal criminal tax statutes as carving out an
exception to the traditional rule [that ignorance of the law is no excuse]. This special treatment
of criminal tax offenses is largely due to the complexity of the tax laws.”).
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No. 05-20604
it saying, “We are not violating the FCPA, ha-ha-ha.” Well, well,
well. Where was that document? There are hundreds of exhibits in
this case; and I didn’t see that document, not Mr. Theriot’s
document, and no one else’s document. Another obvious fabrication
from Mr. Theriot offered to you in this trial.
....
And, of course, they’re going to imply to you that, “Well here’s this
document. ‘FCPA,’ that means David Kay must have known. That
means David Kay has evil intent.” Doesn’t come close.6
The Government also focused on whether Defendants knew that they were
violating the FCPA specifically, stating,
Now, the instruction on “corrupt intent” is on page 17 of your
instructions. And the – what it says is before you. But what it does
– what is clear is that corrupt intent has nothing to do with whether
either defendant understood the FCPA, whether they had the intent
to violate that law.7
In rebuttal, the Government further argued,
Mr. Weingarten kept – said, “How – given all you know about Mr.
Kay’s background, how would he know about the FCPA? How
would he know that what he was doing – how would he learn about
the FCPA?” Well, it’s irrelevant whether he learned about the
FCPA. The question is how couldn’t he know that paying bribes is
wrong? That, ladies and gentlemen, that’s not public relations, it’s
not politics, it’s not even legal – legalities.
If you were asked to pay a bribe and someone told you and –
wouldn’t you know it was wrong? And if you thought there was any
possibility that it was illegal, wouldn’t you check? And you heard
6
Closing Argument of Reid Weingarten for David Kay.
7
Closing Argument of Philip Urofsky for the Government.
6
No. 05-20604
from Mr. Kay himself he never asked anyone whether this was
okay.8
The jury instructions on corrupt intent, looking to the instructions as a
whole and the closing arguments of counsel, show that the jury did not believe
that Defendants could be convicted if they did not know that they were doing
something unlawful. The jury’s question to the judge confirms this, indicating
that the jury was unsure of whether Defendants knew that they were violating
the FCPA specifically, not the law in general. The jury asked, “Can lack of
knowledge of the FCPA be considered an accident or mistake?”
The defense understandably focuses on the differences underlying the
gradations of intent and suggests that the opinion has offered the instruction
here as satisfying both general intent and specific intent. To be clear, we return
to first principles. That is, this case was tried on the basis that the Government
had to prove that the Defendants knew that their actions violated the law,
although they did not need to prove that they were aware of the specific
provisions of the FCPA. Set in the context of trial, including the closing
arguments of counsel, there was no uncertainty in the instructions regarding the
Government’s burden to prove that Defendants knew that their conduct was
illegal. Mr. Weingarten argued forcefully and eloquently that his client could
never have known the detail of the FCPA. The Government, while responding
that they need not prove the specifics of the FCPA, made clear that it had to
prove that Defendants knew that their conduct was illegal.
Our opinions have adequately addressed Defendants’ other arguments.
The Petition for Rehearing is DENIED.
8
Rebuttal Argument of Philip Urofsky for the Government.
7