U.S. v. Wells, s. 93-3924

• Decision Date: 14 October 1997
• Docket Number: Nos. 93-3924,93-3932 and 94-1031,s. 93-3924
• Citation: 127 F.3d 739
• Parties: UNITED STATES of America, Appellee/Cross-Appellant, v. Jerry E. WELLS and Kenneth R. Steele, Appellant/Cross-Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 739

127 F.3d 739

UNITED STATES of America, Appellee/Cross-Appellant, v. Jerry E. WELLS and Kenneth R. Steele, Appellant/Cross-Appellee.

Nos. 93-3924, 93-3932 and 94-1031.

United States Court of Appeals,

Eighth Circuit.

Submitted July 26, 1997.

Decided Oct. 14, 1997.

James R. Wyrsch, Kansas City, MO (Jacqueline A. Cook and W. Brian Gaddy, on the brief), for appellant.

Matt J. Whitworth, Assistant U.S. Attorney, Kansas City, MO (Marietta Parker, on the brief), for appellee.

Before MORRIS S. ARNOLD, Circuit Judge, JOHN R. GIBSON, Senior Circuit Judge, and MELLOY ^*, Chief District Judge.

MELLOY, Chief District Judge

I.

This matter is before the court pursuant to remand from the United States Supreme Court.

In United States v. Wells, --- U.S. ----, 117 S.Ct. 921, 137 L.Ed.2d 107 (1997), the Supreme Court held that materiality is not an element of 18 U.S.C. § 1014, which makes it a crime to knowingly make a false statement for the purpose of influencing the actions of a federally insured bank. The Supreme Court vacated this Court's decision in United States v. Wells, 63 F.3d 745 (8th Cir.1995), which had held that materiality was an element of § 1014, and remanded the case for consideration of the remaining issues raised by the defendants. See --- U.S. at --- - ----, 117 S.Ct. at 931-932.

The remaining issues presented by the defendants are (1) whether the defendants have been held to answer for a crime not charged in their indictments and (2) whether the district court's instructions had the effect of improperly directing a verdict against the defendants. The court must also resolve the government's cross appeal, in which it argues the trial court erred in its guideline computations and the imposition of sentence. We affirm the defendant's conviction and reverse and remand for resentencing.

Since the background in this case and the underlying facts have been fully explored in this court's prior decision and the Supreme Court decision, we will only set forth those facts necessary to resolve the issues which remain for consideration.

II.

As an initial matter, the government argues that we should not consider either of the defendants' remaining arguments, since, in its view, those arguments could have been raised in the initial appeal to this Court. The defendants could only have raised those arguments, however, if they had anticipated the government's position that materiality is not an element of § 1014, a position that the government adopted for the first time in a supplemental brief to this Court. Since nothing in the conduct of this case up to that point suggested that the government contested the supposed materiality requirement of § 1014, we decline to find that the defendants have waived their right to a consideration of their claims simply because they did not anticipate the government's change of position and brief all ancillary issues resulting from that change of position.

III.

The indictments in this case charged that the defendants made "material" false statements for the purpose of influencing a federally insured bank. While that allegation of materiality was in accord with our precedent at the time, see, e.g., U.S. v. Ribaste, 905 F.2d 1140 (8th Cir.1990), it is now clear that materiality is not an element of the crime charged. The defendants argue that, regardless of whether materiality is an element of § 1014, materiality is still an element of the offense "as set forth in the indictment," and so the government must prove the materiality of their statements to the satisfaction of a jury. Anything less, according to the defendants, would amount to a violation of their right to be tried only on the charges brought by the grand jury.

When an indictment includes all of the essential elements of an offense, but also treats other, superfluous matters, the superfluous allegations may be disregarded and the indictment is proper. See, e.g., Ford v. U.S., 273 U.S. 593, 47 S.Ct. 531, 71 L.Ed. 793 (1927); U.S. v. Miller, 471 U.S. 130, 105 S.Ct. 1811, 85 L.Ed.2d 99 (1985); U.S. v. Norris, 34 F.3d 530, 532 (7th Cir.1994); U.S. v. McIntosh, 23 F.3d 1454, 1457 (8th Cir.1994)("Allegations in the indictment that are not necessary to establish a violation of a statute are surplusage and may be disregarded if the remaining allegations are sufficient to charge a crime").

Since superfluous allegations are not part of the charged offense and may be disregarded, the government is not required to prove those allegations in order to obtain a conviction. See U.S. v. Rosenthal, 9 F.3d 1016, 1023 (2nd Cir.1993) ("[A]llegations in an indictment that go beyond the essential elements which are required for conviction do not increase the Government's burden"). All the government need do is prove "that the defendant is guilty of every element of the crime with which he is charged[.]" See U.S. v. Gaudin, 515 U.S. 506, 508-10, 115 S.Ct. 2310, 2313, 132 L.Ed.2d 444 (1995). That was done here, since all the essential elements of § 1014 were submitted to the jury and a conviction resulted.

Striking superfluous allegations does not result in an impermissible constructive amendment of an indictment. As we explained in U.S. v. Begnaud, 783 F.2d 144 (8th Cir.1986), a constructive amendment occurs when the jury is "allowed ... to convict the defendant of an offense different from or in addition to the offenses alleged in the indictment." 783 F.2d at 147; see generally 24 Moore's Federal Practice, § 607.06 (Matthew Bender 3rd Ed.1997). Paring down an indictment so that it alleges just the essential elements of an offense does not expose a defendant to the risk of being convicted of any additional or different offenses. See, e.g., U.S. v. Helmsley, 941 F.2d 71, 91--92 (2nd Cir.1991)(allegation in indictment that items of income omitted from tax returns were "substantial" was surplusage not essential to offense and could be dropped from indictment); U.S. v. Bledsoe, 898 F.2d 430 (4th Cir.1990)(holding that deleting word "public" from an indictment charging defendant with selling drugs within 1000 feet of a "public" secondary school was not an impermissible amendment when statute prohibited drug selling within 1000 feet of any secondary school). The charged offense is the same throughout, and so the court has not "permit[ted] a defendant to be tried on [a] charge that [is] not made in the indictment against him." Stirone v. U.S., 361 U.S. 212, 217, 80 S.Ct. 270, 273, 4 L.Ed.2d 252 (1960); Helmsley, 941 F.2d at 92.

IV.

Although the jury in this case did not have to determine materiality, it did have to determine whether the defendants made false statements for the purpose of influencing the actions of a federally insured bank. The district court gave the following instruction on the meaning of "false statement": A statement or representation is "false" when it is untrue when made or effectively conceals a material fact. A material fact is a fact that would be important to a reasonable person in deciding whether to engage or not to engage in a particular transaction.

...

The materiality of the statement or representation alleged to be false or concealed is not a matter with which you are concerned and should not be considered by you in determining the guilt or innocence of the defendant.

The defendants argue that the statement by the court that materiality is not an issue that should concern the jury had the effect of improperly directing a verdict for the government on the issue of falsity of the statement. We agree that in light of the Supreme Court decision in this case, any reference to materiality in the jury instruction is unnecessary and has the potential to cause confusion. However, we have repeatedly held that an instruction that may be less than a model of clarity does not require reversal, provided that the instruction does accurately set out the elements of the offense which the government much prove. See Toro Co. v. R & R Products Co., 787 F.2d 1208, 1215 (8th Cir.1986); Roth v. Black & Decker, Inc., 737 F.2d 779, 783 (8th Cir.1984); Stoetzel v. Continental Textile Corp. of America, 768 F.2d 217, 224 (8th Cir.1985); Gander v. FMC Corp., 892 F.2d 1373 (8th Cir.1990).

In this case the jury was instructed that, in order to convict, it had to find that the statements at issue were either untrue when made or effectively concealed a material fact. The instruction went on to state that "the materiality of the statement or representation alleged to be false or concealed is not a matter with which you are concerned ..." (emphasis added). Reading the instructions as a whole, there can be little doubt that the jury was properly instructed that it had to find the alleged false statement to be untrue or to have effectively concealed a fact, and that making the false statement or concealing the fact was done with the intent to influence the bank's actions. See Wells, --- U.S. at ----, 117 S.Ct. at 931. Although there may be superfluous language in the instruction, the government's burden of proof is correctly stated in the instruction. We cannot agree with the defendants that the court's statement concerning materiality would have the effect of directing the jury to find that the statement were also untrue.

The district court's instruction did not displace the jury from its proper role of determining the factual question of whether the defendants made false statements for the purpose of influencing the bank. Accordingly, the district court's instructions did not invade the province of the jury.

V.

We turn last to the government's sentencing appeal. The district court sentenced the defendants under § 2F1.1 of the federal sentencing guidelines, which covers "Offenses Involving Fraud or Deceit." The crimes under this section carry a Base Offense Level of 6. U.S.S.G. § 2F1.1(a). The district court increased the base level by 4, based on its determination that the defendants did not intend to cause any loss to the banks,...