United States v. Feng Tao
| Decision Date | 02 November 2020 |
| Docket Number | Case No. 19-20052-JAR |
| Citation | 499 F.Supp.3d 940 |
| Parties | UNITED STATES of America, Plaintiff, v. FENG TAO, Defendant. |
| Court | U.S. District Court — District of Kansas |
Adam Barry, Benjamin J. Hawk, DOJ-NSD, Nathan Michael Fifer Charles, U.S. Department of Justice, Washington, DC, Donald Christopher Oakley, Office of United States Attorney, Kansas City, KS, Anthony W. Mattivi, Topeka, KS, for Plaintiff.
Laura Zell, Michael F. Dearington, Pro Hac Vice, Peter R. Zeidenberg, Pro Hac Vice, Arent Fox LLP, Washington, DC, Thomas H. Johnson, Petefish, Immel, Hird, Johnson, Leibold & Sloan, LLP, Lawrence, KS, for Defendant.
This matter is before the Court on Defendant Feng Tao's Motion to Dismiss the Second Superseding Indictment for Failure to State an Offense and Lack of Venue (Doc. 82) and Motion to Dismiss Second Superseding Indictment due to the Government's False, Misleading, and Prejudicial Statements to the Grand Jury (Doc. 83). Also before the Court is Asian Americans Advancing Justice and Asian Americans Advancing Justice-ALC's ("Amici") Motion for Leave of Court to Enter Their Appearance as Amicus Curiae and File Brief in Support of Defendant Dr. Franklin Tao's Motion to Dismiss the Second Superseding Indictment for Failure to State an Offense (Doc. 86). The Court heard oral argument on Defendant's motions on October 1, 2020. The Court grants Amici's motion for leave to appear and file the brief attached to their motion. Having fully considered the briefs and the parties’ oral argument, the Court is prepared to rule on the motions to dismiss. As explained more fully below, the Court denies Defendant's motions to dismiss.
The following facts are alleged in the Second Superseding Indictment ("SSI") and assumed to be true for purposes of deciding this motion. Defendant Dr. Feng "Franklin" Tao is a full-time professor and researcher who worked at the University of Kansas ("KU") Center for Environmentally Beneficial Catalysis on projects involving renewable energy. KU is a public research university governed by the Kansas Board of Regents ("KBOR"). In his capacity as a researcher at KU, Defendant was responsible for submitting United States Government ("USG") grant proposals through KU and for managing USG-funded research projects at KU. Between December 2017 and August 2019, Defendant obtained funds from the U.S. Department of Energy ("DOE") and the National Science Foundation ("NSF") to support his research at KU.
The KBOR has a policy requiring faculty and staff of KBOR institutions, including KU, to disclose any current or prospective situations that involve potential conflicts of interest or time as soon as they became known. KBOR policies required Defendant to annually disclose conflicts of interest or time using KU's Institutional Responsibilities form ("Conflict form"), which included a certification that he was in compliance with KBOR policies, that he would "secure approval prior to engaging in any external personal, professional activities[, and that] he agreed to report any changes as soon as they become known to him and no later than 30 days after acquiring a new significant financial interest."1
The People's Republic of China ("PRC") uses "talent plans" to encourage the transfer of ideas and intellectual property from the United States to PRC institutions. Applicants tend to have experience in "cutting-edge science or engineering research" and the PRC usually provides the participants with significant financial and social incentives to join the program. Defendant applied to one of these talent programs, the Chang Jiang Scholar Program ("Scholar Program"), for the first time in 2016; he was not selected. Starting in May 2017, he met with contacts in China regarding the Thousand Talents Program, a different talent program. But he ultimately applied to the Scholar Program again in July 2017. On November 11, 2017, he sent an email from Kansas to the Consulate General of the PRC in Illinois about traveling to Fuzhou University ("FZU"). Defendant was accepted into the Scholar Program at the end of December 2017, with the understanding that he would be employed full time at FZU and would conduct research there involving renewable energy for the benefit of the PRC. Beginning in May of 2018, Defendant signed a five-year contract requiring him to be a full-time employee at FZU.
Defendant falsely certified on two Conflict forms that he did not have any conflicts of interest or time under the KBOR policies, first on January 9, 2018, and again on September 25, 2018. On January 29, 2018, in a grant proposal for DOE-funded research, Defendant certified to KU that he had made all relevant disclosures, financial and otherwise, as required by KU and the KBOR. On May 17, 2018, Defendant submitted a proposal to KU for collaborative research with FZU and then later proposed using that budget to buy out his spring 2019 teaching requirement. On July 16, 2018, Defendant represented to the DOE that he was only receiving and only expected to receive USG funding, despite expecting to receive funding from FZU and the PRC. On June 15, 2019, Defendant submitted a progress report to the DOE stating he had no changes to current or expected support.
The Government alleges that these communications were misrepresentations that were part of a scheme to defraud KU of his salary and the USG of grant funds from May 2017 through August 21, 2019. The ten-count Second Superseding Indictment charges Defendant in Counts 1–7 with wire fraud in violation of 18 U.S.C. § 1343, and in Counts 8–10 with making false statements in violation of 18 U.S.C. § 1001.2
Defendant argues that the SSI fails to state an offense under Fed. Crim. P. 12(b)(3) as to all counts and that venue does not lie in the District of Kansas as to Count 10. That subsection governs motions to dismiss before trial, including where there is a defect in instituting the prosecution or a defect in the indictment. Potential defects in initiating prosecution include improper venue.3 Potential defects in an indictment include failure to state an offense.4
"An indictment is sufficient if it sets forth the elements of the offense charged, puts the defendant on fair notice of the charges against which he must defend, and enables the defendant to assert a double jeopardy defense."5 If these three standards are met, then the indictment "need not go further and allege in detail the factual proof that will be relied upon to support the charges."6 Importantly, Rule 12(b)(3) authorizes the district court to resolve before trial only those motions "that the court can determine without a trial of the merits. "7 Accordingly, "[i]f contested facts surrounding the commission of the offense would be of any assistance in determining the validity of the motion, Rule 12 doesn't authorize its disposition before trial."8 To that end, "a court generally is bound by the factual allegations contained within the four corners of the indictment" when ruling on a pretrial motion claiming a defect in an indictment for failure to state an offense.9
Although in "rare exception[s]" a court can potentially "resort to facts outside the indictment that bear on the merits of the case, this "extra-indictment evidence ... must be undisputed in the sense that it is agreed to by the parties."10 In other words, if either party "expresse[s] any objection to its consideration or any objection to its completeness and accuracy," a court is constrained to the allegations in the indictment.11 As the Tenth Circuit has explained, "unlike their civil counterparts, criminal proceedings have no extensive discovery and summary judgment procedures requiring both sides to lay their evidentiary cards on the table before trial."12
"Challenging an indictment is not a means of testing the strength or weaknesses of the government's case, or the sufficiency of the government's evidence."13 Rather, "[a]n indictment should be tested solely on the basis of the allegations made on its face, and such allegations are to be taken as true."14 "On a motion to dismiss an indictment, the question is not whether the government has presented sufficient evidence to support the charge, but solely whether the allegations in the indictment, if true, are sufficient to establish a violation of the charged offense."15
Courts should therefore avoid considering evidence outside the indictment when testing the indictment's legal sufficiency.16 Similarly, the Court should consider a motion for improper venue under Fed. R. Crim. P. 12(b)(3)(A)(i) based on the four corners of the indictment.17
Defendant submits two exhibits in support of his motion to dismiss for failure to state an offense: Exhibit A is the January 9, 2018 Conflict form on which Counts 3 and 8 are based; Exhibit B is the September 25, 2018 Conflict form on which Counts 6 and 9 are based. The Government objects to the Court's consideration of these documents; thus, the Court disregards them in deciding the motion to dismiss for failure to state an offense and considers only the allegations set forth in the SSI.
Counts 1 through 7 allege violations of the wire fraud statute, 18 U.S.C. § 1343 :
Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, transmits or causes to be transmitted by means of wire, radio, or television communication in interstate or foreign commerce, any writings, signs, signals, pictures, or sounds for the purpose of executing such scheme or artifice, shall be fined under this title or imprisoned not more than 20 years, or both.
The elements of wire fraud are: "(1) a scheme to defraud; (2) an interstate wire communication; and (3) a...
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