United States v. Smukler

• Decision Date: 19 March 2021
• Docket Number: No. 19-2151,19-2151
• Citation: 991 F.3d 472
• Parties: UNITED STATES of America v. Kenneth SMUKLER, Appellant
• Court: U.S. Court of Appeals — Third Circuit

991 F.3d 472

UNITED STATES of America

v.Kenneth SMUKLER, Appellant

No. 19-2151

United States Court of Appeals, Third Circuit.

Argued June 17, 2020

Filed: March 19, 2021

Eric L. Gibson, Esq. (Argued), Office of the United States Attorney, 615 Chestnut Street, Suite 1250, Philadelphia, PA 19106, Counsel for Appellee

Peter Goldberger, Esq. (Argued), 50 Rittenhouse Place, Ardmore, PA 19003, Counsel for Appellant

Before: JORDAN, MATEY, ROTH, Circuit Judges.

OPINION

MATEY, Circuit Judge.

Interpreting the term "willfully" can be a challenge. It is a "chameleon word," United States v. Starnes , 583 F.3d 196, 210 (3d Cir. 2009), and "[i]n any closely reasoned problem, whether legal or nonlegal, chameleon hued words are a peril both to clear thought and to lucid expression," Bryan A. Garner, A Dictionary of Modern Legal Usage 145 (2d ed. 1995) (quoting Wesley N. Hohfeld, Fundamental Legal Conceptions 35 (1919) (reprint 1966)). But we take comfort knowing that we do not struggle alone with this "notoriously malleable" concept. Bryan v. United States , 524 U.S. 184, 202, 118 S.Ct. 1939, 141 L.Ed.2d 197 (1998) (Scalia, J., dissenting). Indeed, "willfully" is "a word of many meanings" whose definition is "dependent on the context in which it appears." Id. at 191, 118 S.Ct. 1939 (majority opinion). And just as a chameleon's appearance depends on the surroundings, we look to the whole text of a law to best "interpret the words consistent with their ordinary meaning ... at the time Congress enacted the statute." Wis. Cent. Ltd. v. United States , ––– U.S. ––––, 138 S. Ct. 2067, 2070, 201 L.Ed.2d 490 (2018) (alteration in original) (internal quotation marks omitted). We approach that task with a full box of "traditional tools" of construction. Kisor v. Wilkie , ––– U.S. ––––, 139 S. Ct. 2400, 2415, 204 L.Ed.2d 841 (2019). Aided by these principles, interpreting "willfully" seems less troublesome.

Kenneth Smukler asks us to do just the opposite, arguing for an exceptional understanding of "willfully" in otherwise unexceptional statutes. But the ordinary understanding of "willfully" is the best one. Smukler does, however, rightly point out that the District Court departed from our prior decisions when instructing the jury on two of his nine counts of conviction. So we will vacate his conviction on those counts. Smukler also brings a host of other procedural and substantive challenges from his trial. Finding none with merit, we will affirm his other convictions.

I. BACKGROUND

Kenneth Smukler made a thirty-year career in the rough and tumble world of campaign politics. From mayors and city councils, to members of Congress and presidents, Smukler steered campaigns across Pennsylvania. And as an attorney, Smukler developed familiar expertise with Federal Election Commission ("FEC") law. Then, as it sometimes does in politics, things went wrong.

A. The 2012 Democratic Primary for the First Congressional District of Pennsylvania

In 2012, United States Representative Bob Brady ran for reelection to represent Pennsylvania's First Congressional District in Philadelphia. Jimmie Moore, a former Philadelphia Municipal Court Judge, challenged Brady in the Democratic primary. Moore struggled to raise money, so he personally loaned his campaign about $150,000. It was not enough, and Moore soon concluded that he would not win. He turned to Plan B, reaching out to former Philadelphia Mayor Wilson Goode to arrange a meeting between himself and Brady, with Goode providing the "glue." (App. at 971, 1555.)

In a scheme lacking only a smoke-filled backroom, Moore, Goode, and Brady hashed out a deal for Moore to drop out of the race. In exchange, Brady agreed to give Moore $90,000 to pay off campaign debts and reimburse some of Moore's campaign loan. Of course, as Moore, Goode, and Brady all knew, one candidate cannot bribe another candidate to drop out of an election. They needed a plan to steer the money to Moore. Brady suggested that he buy a poll that Moore had conducted. The purpose was plain: "mov[e] money from Bob Brady's campaign to Jimmie Moore's campaign." (App. at 1318.) With an agreement in place, Moore dropped out of the race a few days later, clearing Brady's path to the Democratic nomination.

But the money still needed a mover, and Smukler emerged as the middleman. Once Moore formally dropped out, Smukler met with Moore "to make the arrangements" and "set up the process for [Moore] to get the money." (App. at 953, 1071.) Smukler proposed a three-part scheme. First, they would set up a bogus corporation to receive the funds from the Brady campaign. Then, Moore would create "some dummy invoices." (App. at 954, 1063.) Finally, Smukler would pay Moore in three installments, through cash sent to Moore's campaign manager and romantic partner, Carolyn Cavaness.¹ For good measure, Smukler would route the payments to Cavaness through the consulting firm of Donald "D.A." Jones, a political consultant working for Brady, for work that Cavaness never performed.² All went as planned, including, of course, both campaigns omitting accurate reporting of any of these transactions to the FEC.

B. The 2014 Democratic Primary for the Thirteenth Congressional District of Pennsylvania

In 2014, former United States Representative Marjorie Margolies launched a comeback bid. Like many elections, congressional contests occur in two cycles: a primary election, where candidates of the same political party square off, followed by a general election between the prevailing candidates of each party to decide who will represent the people. Federal election law limits contributions to a candidate in both phases. So while candidates may collect primary and general election funds at any time, they cannot use general election funds to pay for primary election expenses. That means if a candidate loses the primary, the campaign refunds any general election contributions to donors.

Margolies faced a crowded field of primary opponents and hired Smukler to run her campaign. But as the race dragged on, Margolies ran low on funds and Smukler dipped into the general election reserve. It wasn't enough; Smukler needed more money to cover crucial campaign expenses like media buys. So he leaned on friends and family to get cash quickly, using them as straw men to evade federal election laws and pass through money to the campaign. We detail several of those donations and associated misrepresentations.

1. Smukler Sends $78,750 to the Margolies Campaign

On April 29, 2014, Smukler emailed Jennifer May, Treasurer of the Margolies campaign, "I will be wiring $78,750 of the segregated media account funds into the campaign media account." (Supp. App. at 461.) No such "segregated media account" existed. A few days later, he wired $78,750 from his personal brokerage account to another of his companies, Black and Blue Media. From there, he wired the same amount from Black and Blue Media to a new Margolies campaign account to quickly pay vendors. Then Smukler asked his brother for $75,000, which his brother promptly sent to Smukler's brokerage.

2. The Campaign Spends Money Earmarked for the General Election and Smukler Steers Another $150,000 to Cover the Difference

Still short on cash, Smukler directed May to use general election funds on the primary. A deficit soon swelled, as the primary fund declined to a negative cash on hand of $126,761 and change. Then, Margolies lost the primary, leaving the campaign sixty days to refund all general election contributions. May suggested that Margolies pay the deficit herself, a lawful option that Smukler declined. Instead, he asked campaign officials, including May, to tell him "exactly what amount [Smukler's two companies:] InfoVoter and Black [and] Blue need to return to the campaign to reconcile all general fund contributions" as he "intend[ed] to transfer [the money]." (App. at 774.) Sensibly, May concluded that if Margolies did not write a check for the overage, "we are all in really big trouble." (App. at 2212.)

May was correct; Smukler was undeterred. He surprised May with the claim that the Margolies campaign "did not spend the general [election] money as it was escrowed in" Smukler's consulting company InfoVoter. (App. at 2212.) "[O]nce the money is refunded," Smukler explained, "all the general [election] checks will be issued within the [sixty-day] period." (App. at 2212.) That same day, an old friend of Smukler's, Kevin Morgan, wired $150,000 into Smukler's personal brokerage account. Two days later, Smukler wired $40,000 from his personal account to Black and Blue Media and $110,000 from his personal account to InfoVoter. It all wound up in the Margolies campaign in two separate transfers from Black and Blue Media and InfoVoter. Smukler directed both payments to appear as "[r]efund[s]" on the next FEC report. (App. at 610, 791–800; Supp. App. at 194.)³

3. Smukler Conceals the Transfers

Smukler had another problem. Back in April, one of Margolies’ opponents filed a complaint with the FEC alleging that the campaign had spent general election contributions on primary election expenses. That was true, so Smukler spun a false tale to the campaign's attorney, causing him to lie in the campaign's response to the FEC. Based on Smukler's representations, the campaign's attorney wrote to the FEC that the Margolies campaign had "agreed to advance a portion of [general election] funds" to certain "campaign vendors in order to secure their services ... for the general election." (App. at 2230.) But because "[t]he advanced funds would ... pay for general election ... expenses of the vendors," after Margolies lost the primary, the vendors "refunded the advanced payments to the committee." (App. at 2230.) Smukler's argument benefited from apparent support from the campaign's FEC filings, which had also described the payments from Smukler's companies as "refunds." (App. at 610, 791–800; Supp. App. at 194.) Based on the letter, the FEC dismissed the complaint.

4. The Margolies...