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Skilling v. United States - Brief (Merits)

Docket Number
No. 08-1394
Supreme Court Term
2009 Term
Brief Topics
Criminal (including Habeas/2255)
Merits Stage Brief
Court Level
Supreme Court

No. 08-1394


In the Supreme Court of the United States






Solicitor General
Counsel of Record
Acting Assistant Attorney
Deputy Solicitor General
Assistant to the Solicitor
Department of Justice
Washington, D.C. 20530-0001
(202) 514-2217



1. Whether, to convict petitioner of conspiring to commit wire fraud by depriving his employer and its shareholders of the right to petitioner's honest services (18 U.S.C. 1343, 1346), the government was required to prove that petitioner intended to obtain some private gain.

2. Whether 18 U.S.C. 1346 is unconstitutionally vague.

3. Whether the district court erred in denying pe titioner's motions for a change of venue.

In the Supreme Court of the United States

No. 08-1394








The opinion of the court of appeals (Pet. App. 1a- 135a) is reported at 554 F.3d 529.


The judgment of the court of appeals was entered on January 6, 2009. A petition for rehearing was denied on February 10, 2009 (Pet. App. 136a-138a). The petition for a writ of certiorari was filed on May 11, 2009. The petition for a writ of certiorari was granted on October 13, 1999. The jurisdiction of this Court rests on 28 U.S.C. 1254(1).


Following a jury trial in the United States District Court for the Southern District of Texas, petitioner was convicted of one count of conspiracy to commit securities fraud and wire fraud, in violation of 18 U.S.C. 371 (Count 1); 12 counts of securities fraud, in violation of 15 U.S.C. 78j(b) and 78ff, 17 C.F.R. 240.10b-5, and 18 U.S.C. 2 (Counts 2, 14, 16-20, 22-26); five counts of mak ing false representations to auditors, in violation of 15 U.S.C. 78j(b) and 78ff, and 18 U.S.C. 2 (Counts 31-32, 34-36); and one count of insider trading, in violation of 15 U.S.C. 78j(b) and 78ff, 17 C.F.R. 240.10b-5, and 18 U.S.C. 2 (Count 51). J.A. 1107a-1113a. The court of ap peals affirmed petitioner's convictions but vacated his sentence and remanded for resentencing. Pet. App. 1a- 135a.

1. Petitioner was the president, chief operating offi cer, and, for several months in 2001, the chief executive officer of Enron Corporation. Between 1999 and the end of 2001, petitioner orchestrated a massive scheme to deceive Enron's shareholders, federal regulators, and the investing public about the company's financial condi tion and performance. Pet. App. 1a-18a.

a. Enron was formed by the merger of two natural gas pipeline companies in 1985. R. 15066. It enjoyed steady growth through the 1990s due largely to earnings from energy trading in the company's wholesale divi sion. R. 15228. By early 1999, Enron's stock was trad ing at about 25 times its per-share earnings. R. 17227. Petitioner, whose compensation was tied directly to the value of the company's stock, wished to increase the share price even further. But petitioner also knew that revenue from Enron's existing trading business could not support a higher price-to-earnings multiple (or P/E ratio); as he told his managers, "[t]here ain't no more 'E' in the earnings." R. 17228. Petitioner therefore sought to increase the P/E ratio by convincing the market that Enron was poised for steady and significant growth.

As part of that strategy, petitioner portrayed as bright and promising the prospects of two newer busi nesses: Enron Energy Services (EES), which sold en ergy at retail, and Enron Broadband Services (EBS), which represented Enron's effort to enter the telecom munications industry. R. 15226-15229, 17229-17232, 19920-19921. Instead of showing promising results, however, EES and EBS suffered substantial losses. By early 2001, Enron internally predicted that EES would eventually lose more than $1 billion as a result of deteri orating conditions in the California utilities markets. R. 19398. Similarly, EBS lost money in every quarter that it existed. R. 17215, 17232-17233, 17239-17241.

Petitioner responded by systematically concealing the financial condition of EES and EBS from investors. In March 2001, instead of truthfully disclosing EES's poor first quarter numbers, petitioner hastily arranged a "reorganization" of that business two days before the quarter ended. R. 19979-19982. The sole purpose of the reorganization was to hide the losses in EES by shifting all of its money-losing components into the larger bal ance sheet of Enron's wholesale division. R. 15556, 19446-19448, 19775-19781. The head of EES later testi fied that petitioner's approval of the reorganization was the worst corporate conduct he had ever experienced, R. 20257, and said of the meeting at which it took place, "I wish on my kids' lives I would have stepped up from that table and walked away." R. 20338.

As a result of the reorganization scheme, Enron re ported first quarter earnings for EES of $40 million, when in fact the business should have recognized a $350 million loss. R. 19988-19989. In the second quarter, Enron announced that EES's earnings had increased 30% to $60 million, although in reality EES had lost $495 million by that time. R. 15567-15568, 15572-15573; Gov't C.A. Br. 17. On analyst calls, petitioner assured investors that "first quarter results were great," that EES "had an outstanding second quarter," and that the reason for the shift of certain aspects of EES's business to the wholesale division was "to get more efficiency out of management." Id. 33; R. 15579.

Petitioner engaged in a similar deception to conceal the failure of EBS. He set earnings targets at numbers that its executives told him they could not meet and re fused to change those targets when senior management warned of shortfalls. R. 17281-17283. To meet the in flated targets, EBS "monetized," or sold as securities, the projected future revenue from its contracts-an ac counting trick that one senior manager described as "[o]ne more hit of crack cocaine" because it provided an artificial short-term jolt to the company's earnings. R. 17359, 20667-20668. As with EES, petitioner misrep resented the true condition of EBS. At an analyst con ference in January 2001, petitioner told investors that EBS was a "uniquely strong franchise[] with sustainable high earnings power," even though he had learned from EBS's CEO three weeks earlier that the company had an unsupportable cost structure and no customers. R. 17280-17282; Gov't C.A. Br. 26; GX 984, at 13. And on a special analyst conference call in March 2001 intended to address rumors about EBS's poor condition, peti tioner described EBS as in the midst of a "great quar ter" marked by "strong growth" in all aspects of its busi ness. Gov't C.A. Br. 28-29. According to the trial testi mony of EBS's chief operating officer, that description was "the opposite" of the truth. R. 20698.

Petitioner's scheme to inflate Enron's share price took a wide variety of other forms. To maintain the fic tion that Enron was steadily growing at a rate that met or exceeded analyst's expectations, for example, peti tioner repeatedly directed that earnings figures be al tered after the quarter ended so that the reported num bers would "beat the street." Gov't C.A. Br. 35. On two such occasions, funds were simply moved out of unre lated reserve accounts and recorded as earnings. R. 19311, 19324-19327. The CEO of Wholesale later ex plained that this tactic was "backwards" and flatly im proper. R. 19859. As one of Enron's outside auditors put it at trial: "That is not a gray area. It's black and white." R. 23512.

b. On August 14, 2001, petitioner abruptly resigned from his position as Enron's CEO. By that time, peti tioner knew that Enron faced mounting problems and was suffering substantial undisclosed losses. R. 21451- 21452, 23962. On September 6, 2001, shortly after meet ing with Kenneth Lay, who had succeeded petitioner as CEO, petitioner called his broker and tried to sell 200,000 shares of Enron stock. R. 25018-25019, 25021. The broker explained he would have to report the trans action to the SEC and the public unless petitioner ob tained a letter from Enron indicating that he was no longer a manager. R. 25021-25023. Petitioner told the broker to hold the order, R. 25021, obtained such a let ter on September 10, 2001, Gov't C.A. Br. 64; GX 1892, and on September 17, the first day that the markets opened after the September 11 terrorist attacks, con veyed to his broker an order to sell 500,000 shares of Enron stock along with instructions that he did not want people at Enron to know about the sale. R. 25024, 25032. Petitioner netted more than $15 million from the transaction; he later testified under oath before the SEC that the reason he sold those shares was that he was "scared" by September 11, and that "[t]here was no other reason other than September 11th that [he] sold the stock." R. 25061, 25064. Less than three months after petitioner's trade, Enron collapsed in bankruptcy.

2. On February 18, 2004, a federal grand jury in the Southern District of Texas returned an indictment against petitioner and Richard Causey, Enron's chief accounting officer. First Superseding Indictment. The indictment alleged that petitioner conspired to commit securities fraud and to defraud Enron of money and property through the use of the interstate wires. Id. at 34-41. It also charged petitioner with 35 substantive counts, including 20 counts of securities fraud for mak ing false statements to investors, the SEC, and outside auditors. Id. at 41, 44-50.

On July 7, 2004, the grand jury returned a supersed ing indictment adding Lay as a defendant. J.A. 274a. That superseding indictment also supplemented Count 1 to allege that the conspiracy in which petitioner, Lay, and Causey participated included as an object "depriv ing Enron and its shareholders of the intangible right of honest services." J.A. 318a. The superseding indict ment, like the prior indictment, recounted petitioner's massive scheme to deceive Enron and the investing pub lic by manipulating earnings, making false statements to the SEC and the public, concealing losses through sham transactions, and enriching himself in the process. J.A. 274a-370a.

3. a. On November 8, 2004, petitioner and his co- defendants moved for a change of venue, contending that inflammatory pretrial publicity and pervasive com munity prejudice against former Enron executives would prevent a fair trial in Houston. Gov't C.A. Br. 136-137; Def. Jeffrey Skilling's Memo. in Supp. of Joint Mot. to Transfer Venue 1-5.

The government submitted a lengthy opposition re futing each basis for the motion. Govt's Memo. of Law in Resp. to Defs.' Joint Mot. to Transfer Venue (Venue Response). The government noted that polling data the defendants offered to show pervasive bias among Hous ton residents in fact demonstrated the opposite. Venue Response 35-38. When asked to name Enron executives they believed were guilty of a crime, nearly nine out of ten Houston respondents failed to identify petitioner. Id. at 36. Almost half of those polled had never heard of petitioner or had no substantive response when asked to provide any words they associated with his name. Id. at 37-38; J.A. 371a-551a. Results of a government-con ducted survey, moreover, showed that Houston resi dents were actually more likely to believe that petitioner was not guilty than residents in other cities to which petitioner sought a transfer. Venue Response 40.

The government further argued that the press cover age concerning petitioner was largely factual and objec tive. Venue Response 29-35. Most of the coverage that petitioner characterized as "inflammatory" consisted of entries on the Internet, inside-page stories, letters to the editor, and opinion-based columns of uncertain or low readership. 4:04-cr-00025 Docket entry No. 230 paras. 17-18 (S.D. Tex. Dec. 3, 2004) (Zagorski Decl.). The government emphasized that press coverage of Enron had peaked in 2002, shortly after its bankruptcy, and had generally subsided in the two years since. Venue Response 31-32; Zagorski Decl. paras. 15, 19.

In addition, the government observed that other dis trict courts had considered and rejected the argument that Houston could not produce impartial juries in Enron-related criminal cases. Venue Response 20-28. In November 2003, Judge Hittner concluded that Lea Fastow, the wife of the former Enron chief financial offi cer, had failed to establish that community prejudice would preclude a fair trial or that jury selection would be ineffective to isolate any such prejudice. United States v. Fastow, 292 F. Supp. 2d 914 (S.D. Tex. 2003).1 Similarly, in 2004, Judge Gilmore denied a venue trans fer motion brought by executives of EBS, concluding that the Enron media coverage consisted primarily of "straight news stories" and that the use of question naires on prospective jurors drawn from the large and diverse Houston metropolitan area would yield an im partial panel. Order at 5-6, United States v. Hirko, No. 4:03-cr-00093 (Nov. 24, 2004) (Hirko Venue Order).

b. The district court agreed with the other courts to consider the issue and, after conducting a "[m]eticulous review of all of the evidence and arguments presented by the defendants," denied their motion. App., infra, at 7a. The court found that the defendants had highlighted "isolated incidents of intemperate commentary" but that, "for the most part, the reporting appears to have been objective and unemotional" with a "fact-based tone." Id. at 11a. The court also rejected the claim that community sentiment warranted a presumption of jury prejudice. The court concluded that the defendants' polling data did not show "a reasonable likelihood that the court will be unable to [e]mpanel an impartial jury despite widespread knowledge of the case." Id. at 19a. The court added that public opinion polls are generally "unpersuasive" and that "effective voir dire [i]s a prefer able way to ferret out any bias." Id. at 18a. The court also concluded that because it had "carefully reviewed defendants' evidence," id. at 12a, and because the defen dants' factual allegations would not justify relief even if established, no evidentiary hearing on the motion was necessary, id. at 21a-22a.2

c. By the time petitioner's case reached trial, three other Enron-related criminal cases had proceeded to verdict in Houston: United States v. Arthur Andersen LLP, involving charges against Enron's outside accoun tants; United States v. Bayly, concerning charges against Merrill Lynch and Enron executives for sham sales of Nigerian barges; and United States v. Hirko, involving allegations of fraud and insider trading by five EBS executives. A different district court judge pre sided over each of those trials, but in all three the court conducted jury selection in the same manner. Each court distributed a jury questionnaire to a pool of sev eral hundred potential jurors; dismissed individuals whose responses to the questionnaire demonstrated bias or other disqualifying characteristics; and, after further questioning by the court and counsel, selected a jury from the remaining venire in one day. Venue Response 20-28.

That process proved effective in empaneling juries capable of basing verdicts on the evidence presented in court. In Hirko, the jury deliberated for several days and did not convict any Enron defendant; in Bayly, which was routinely described as "the first Enron crimi nal trial," the jury convicted five defendants, including four Merrill Lynch executives, but acquitted a former Enron executive. Venue Response 24-28. At the sen tencing phase of Bayly, the jury found a loss amount of slightly over $13 million, even though the government had argued that the true loss to Enron and its share holders from the defendants' fraud was $40 million. Id. at 28. In an article reporting the Bayly verdicts, the Houston Chronicle quoted a commentator saying that the performance of the jury undermined claims that Houston could not render impartial justice in Enron- related cases. Mary Flood & Tom Fowler, 5 Guilty in Enron Barge Scheme, Houston Chronicle, Nov. 4, 2004 < barge/2883572.html>.

d. The district court selected petitioner's jury using the same basic procedure employed in Bayly, Hirko, and Arthur Andersen. Before trial, the court distributed a 14-page jury questionnaire to 400 prospective jurors and received 283 responses. R. 11773; S.J.A. 5sa-244sa. The questionnaires sought information about the prospective jurors' jobs, education, political views and party affilia tion, their relationship to Enron or to anyone affected in any way by the company's collapse, their opinions about Enron and the government's investigation, their sources of information about the case, the periodicals they read, and the Internet sites they visited. The questionnaires also asked whether recipients were angry at Enron or had an opinion about the defendants or the defendants' guilt. Gov't C.A. Br. 140. After reviewing the completed questionnaires, the parties agreed to excuse 119 jurors for "cause, hardship, and/or physical disability." R. 11890-11891, 13593-13594. The court remarked that its evaluation of the questionnaires left it "very im pressed by the apparent lack of bias or influence from media exposure." R. 14375.

The court then conducted voir dire of the remaining venire members. The court began by explaining the importance of an impartial jury and inquiring whether "any of you have doubts about your ability to conscien tiously and fairly follow these very important rules." Pet. App. 62a. After excusing two prospective jurors who indicated that they could not be fair, the court again cautioned that the case was not about Enron's bank ruptcy and emphasized that the jurors' role was not "to right a wrong or to provide remedies for those who suf fered from the collapse of Enron." Ibid. The court ad monished the potential jurors that they could not "seek vengeance against Enron's former officers because of some wrongdoing they believe Enron or its officers may have committed," and that anyone who had such an atti tude could not "be a fair and impartial juror." Id. at 62a-63a.

The court next questioned the potential jurors indi vidually, out of earshot of other venire members, about their responses to the jury questionnaire and exposure to pretrial publicity. J.A. 852a; Pet. App. 63a; Gov't C.A. Br. 141. The court allowed the defense attorneys to ask further questions they thought necessary to determine a juror's impartiality, and although the court twice cur tailed inquiry by Lay's counsel, it never prevent peti tioner's counsel from asking such questions. Ibid. Even so, defense counsel asked only eight potential jurors about their exposure to publicity and declined to ques tion 19 of the 46 potential jurors called to the bench, including four who were selected and three of the four alternates. R. 14445-14446, 14468-14470, 14477-14478, 14495-14497, 14505, 14534-14535, 14646-14649, 14657- 14659.

Thirty-seven (or approximately 85%) of the 43 poten tial jurors questioned individually about pretrial public ity stated that they had limited exposure to media cover age of Enron or the defendants or did not recall any thing significant. Gov't C.A. Br. 160; see id. at 141-147. Of those venire members who recalled hearing news about Enron, most said that they did not remember very much or did not hear anything that either would make them think petitioner was guilty or would interfere with their ability to decide the case on the evidence. Id. at 144-146.

The court continued the individual voir dire until it had qualified 38 potential jurors-enough so that 12 ju rors and four alternates would remain after the parties exercised their peremptory challenges, including two additional challenges the court allotted the defendants. Gov't C.A. Br. 141; R. 12596. In the process, the court granted three challenges for cause by the defendants and denied five; it granted one challenge for cause by the government and denied four. Gov't C.A. Br. 147.

Of the individuals who remained after this process and served as jurors or alternates, ten told the court that they did not follow the news about Enron, nine ei ther did not subscribe to the Houston Chronicle or read it infrequently, and four never or rarely watched televi sion. Gov't C.A. Br. 141-142. Most indicated a general lack of interest in or knowledge about the Enron subject matter, offering the common refrain that "I just don't care much about it at all" because "it's just not some thing that directly concerns me." R. 14577 (Juror 66); see, e.g., R. 14670 (Juror 113: "[I]t didn't directly affect me, so I didn't really retain much of what was in the news at the time."); R. 14547 (Juror 55: "just not inter ested in the case"); R. 14459 (Juror 28: "not inter ested"); R. 14634 (Juror 91: "I don't know a whole lot about this case, honestly"). One juror whom petitioner unsuccessfully challenged for cause sat on the jury after petitioner declined to use a peremptory strike to remove him. Pet. App. 54a.

e. On May 25, 2006, after a four-month trial and nearly five days of deliberation, the jury found peti tioner guilty of conspiracy, 12 counts of securities fraud, five counts of making false representations to auditors, and one count of insider trading. Pet. App. 19a; Gov't C.A. Br. 5, 161. The jury also found petitioner not guilty of nine counts of insider trading. Pet. App. 19a.

4. The court of appeals affirmed petitioner's convic tions and remanded for resentencing. Pet. App. 1a-135a. Petitioner argued that his conduct did not constitute honest services wire fraud because it was intended to benefit Enron, "not to promote [petitioner's] interests at Enron's expense." Pet. C.A. Br. 68; see id. at 60-71. The court rejected that contention, concluding that "the jury was entitled to convict [petitioner] of conspiracy to commit honest-services wire fraud" based on the ele ments contained in the jury instructions. Pet. App. 29a.

Petitioner also argued that pretrial publicity and community prejudice required a presumption that any jury empaneled in Houston would not be fair and impar tial, and contended that the jury that actually sat in his case was biased. Pet. C.A. Br. 121-173. The court of appeals agreed with petitioner that the nature of the media coverage and the effects of Enron's collapse on Houston were sufficient to raise a presumption of jury prejudice. Pet. App. 54a-60a. The court concluded, how ever, that the district court's "proper and thorough" voir dire "more than mitigated any effects of this prejudice." Id. at 63a, 68a. The court noted that, after "prescreen ing veniremembers based upon their responses" to an "extensive questionnaire," the district court had con ducted "searching" questioning of the prospective ju rors, "requiring more than just the veniremembers' statements that he or she could be fair." Id. at 62a-63a & n.51. In addition, the court found that the govern ment "met its burden of demonstrating the impartiality of the empaneled jury." Id. at 67a; see 63a-68a. Observ ing that petitioner "failed to challenge for cause all but one of the jurors who actually sat," id. at 64a, the court affirmed the district court's finding that the one seated juror whom petitioner had challenged for cause was un biased. Id. at 65a-67a.


I. The district court's denial of petitioner's motion for a change of venue did not violate his constitutional rights. Petitioner's central contention is that the degree and nature of pretrial publicity, and the impact of Enron's collapse on Houston, gave rise to an irrebut table presumption of prejudice among the entire venire. But this Court's cases-and the Constitution-are satis fied if the jurors who actually sat are impartial. Public ity surrounding a crime may create a need for special care in jury selection, but a defendant is not deprived of a constitutional right unless he can show that a selected juror was biased. The meticulous and careful jury-selec tion process conducted by the district court in this case produced an unbiased jury, and petitioner cannot carry his burden to show otherwise.

Petitioner argues for an exception to the usual rule requiring a showing of actual bias based on language in this Court's cases discussing a presumption of prejudice in extreme circumstances. But only one of those cases applied such a presumption, and that case turned on the unique fact of a televised jailhouse confession of the de fendant that saturated the community and effectively substituted for the trial. In the nearly 50 years since, the Court has not seen a similar case. It has invalidated convictions when pretrial publicity produced actually biased jurors, and when the presence of the media in the courtroom produced a circus atmosphere. But those cases fundamentally differ from the situation here. This Court's decision in Mu'min v. Virginia, 500 U.S. 415 (1991), establishes that a trial judge's vigilance in voir dire is fully capable of ferreting out bias and that the judge's decisions to seat a juror are entitled to deference on appeal. In contrast, petitioner's conclusive presump tion of prejudice conflicts with this Court's general avoidance of rules of automatic reversal and is at odds with the basic premise of the jury system that trial judges are equal to the task of empaneling impartial jurors.

Even if publicity could sometimes create a presump tion of prejudice, none should apply here. Petitioner was tried in a large and diverse metropolitan area with a population of 4.5 million. Screening devices are fully capable of identifying 12 jurors untainted by publicity in that setting. Three different district judges hearing Enron-related criminal trials in Houston so concluded. And the mixed outcomes in those cases-including peti tioner's acquittals on nine counts-demonstrates that the publicity did not corrupt the trial juries.

Finally, if a presumption of prejudice did arise here, the government should be able to rebut it by establish ing by a preponderance of the evidence that no biased juror sat. On the record here, the government carried that burden.

II. The honest services statute, 18 U.S.C. 1346, is not unconstitutionally vague, and petitioner's conspiracy conviction should be upheld.

A criminal statute is not unconstitutionally vague if it provides fair notice of the conduct it reaches and does not encourage arbitrary enforcement. This Court has recognized that the meaning of a statute can be illumi nated by judicial decisions and that statutes can incorpo rate terms of art and judicial interpretations of pro tected rights. Section 1346 employs a term of art-"the intangible right of honest services"-which takes its meaning from the body of case law before this Court's decision in McNally v. United States, 483 U.S. 350 (1987). Those cases reveal that honest services viola tions required three elements-a breach of the duty of loyalty, intent to deceive, and materiality. Courts also have universally recognized that the pre-McNally cases took two forms: (1) accepting a bribe or kickback in pay ment for official action, and (2) taking official action that furthers an undisclosed, conflicting personal financial interest. Petitioner would find a lack of clarity in pe ripheral areas of pre-McNally law, in which he exagger ates supposed disagreements, and in past prosecutorial litigating positions, which courts rejected. But none of his arguments refute that the core elements and theo ries of honest services fraud sufficiently define the stat ute to satisfy constitutional requirements. And vague ness concerns are especially unwarranted here because no defendant can be convicted absent intent to engage in deceptive conduct in breach of a known duty.

Petitioner does not question the clarity of the brib ery/kickback line of cases, and in light of the abundant pre-McNally case law he could not reasonably do so. The statute therefore cannot be held facially vague in all of its applications. He does argue that the nondisclosure cases form a less-well-defined category and that nondis closure cases can be prosecuted as money-or-property frauds. Those claims are incorrect. Many pre-McNally cases involved undisclosed self-dealing-including Mc Nally itself. And not all non-disclosure cases defraud the principal of money or property. For example, a council member who votes to rezone an area in which he secretly holds property interests does not commit a money-or-property fraud-but does commit honest ser vices fraud.

While petitioner's crime did not take the classic form of an undisclosed outside interest that the employee fur thered through his official action, it does come within the nondisclosure theory. Petitioner pursued his own financial interests-his compensation scheme-by tak ing action as an Enron executive to inflate Enron's stock price through deception about the company's true finan cial condition. The only question here is whether the public nature of petitioner's compensation scheme pre vents his conduct from constituting honest services fraud. It does not. Although petitioner's basic compen sation scheme was public, his scheme to artificially in flate the company's stock price by misrepresenting its financial condition, in order to derive additional personal benefits at the expense of shareholders, was not. Peti tioner suggests that Section 1346 requires as an element that he acted for private gain, but the pre-McNally cases do not support that purported element and, in any event, it was amply satisfied here.



Petitioner contends (Br. 23-38) that the district court violated his due process right to a fair trial and his Sixth Amendment right to an impartial jury by denying his motions for a change of venue. He argues that pretrial publicity surrounding Enron's collapse created an irrebuttable "presumption of pejudice," requiring auto matic reversal of his convictions without regard to whether the jury that decided his case was actually bi ased. Alternatively, petitioner contends that the "pre sumption of prejudice" obligated the government to prove the impartiality of each juror beyond a reasonable doubt, that the courts below erroneously failed to hold the government to that burden, and that the government could not make such a showing in any event.

The Court should reject those claims. Petitioner received what the Constitution guaranteed him: a trial before a panel of unbiased jurors capable of deciding the case based on the evidence presented in court. Although language in some of this Court's cases speaks of a pre sumption of juror prejudice from pretrial publicity, no holding of this Court requires the general irrebuttable presumption of jury prejudice that petitioner seeks. And many of this Court's cases attest to the efficacy of the usual trial tools employed to ferret out bias. To the extent a presumption of prejudice exists, it would not apply in this case, and even if it did apply, it would not require "automatic reversal" of petitioner's convictions. Instead, any such presumption would shift to the gov ernment the burden to show by a preponderance the actual impartiality of the seated jury. For the reasons the court of appeals identified, the government amply satisfied that showing.3

A. Because The Jury That Decided His Case Was Impartial, Petitioner Has Failed To Establish A Constitutional Violation

Petitioner emphasizes the publicity generated by Enron's collapse, contending that such media coverage, combined with the financial impact of the company's bankruptcy, rendered Houston a constitutionally imper missible venue for his trial. That contention is incorrect. The Constitution guarantees a trial before a jury that is actually impartial, not a trial in a venue whose populace has no exposure to the effects of the defendant's crime or adverse pretrial publicity about it. Because no biased juror sat on petitioner's jury, no violation of rights oc curred.

1. The Constitution requires trial before an impartial jury

"The constitutional standard of fairness requires that a defendant have a panel of impartial, indifferent ju rors." Murphy v. Florida, 421 U.S. 794, 799 (1975) (in ternal quotation marks and citation omitted); see Smith v. Phillips, 455 U.S. 209, 217 (1982) ("Due process means a jury capable and willing to decide the case solely on the evidence before it"). That principle is sat isfied when no biased juror is actually seated at trial. See Rivera v. Illinois, 129 S. Ct. 1446, 1454 (2009) ("[H]aving been tried by a jury on which no biased juror sat, [the defendant] could not tenably assert any viola tion of his right to due process.") (internal quotation marks, citations, and ellipsis omitted); see id. at 1450 ("[i]f all seated jurors are qualified and unbiased," erro neous denial of defendant's peremptory challenge does not warrant reversal); see also United States v. Martinez-Salazar, 528 U.S. 304, 316 (2000); Ross v. Oklahoma, 487 U.S. 81, 85 (1988); Patton v. Yount, 467 U.S. 1025, 1035 (1984) ("The relevant question" is whether the jurors who decided the case "had such fixed opinions that they could not judge impartially the guilt of the defendant.").

A defendant who argues that he was deprived of an impartial jury must establish that claim "not as a matter of speculation but as a demonstrable reality." United States ex rel. Darcy v. Handy, 351 U.S. 454, 462 (1956) (citation omitted). Thus, "[t]his Court has long held that the remedy for allegations of juror partiality" is the de fendant's "opportunity to prove actual bias" on the part of a seated juror. Smith, 455 U.S. at 215; see Dennis v. United States, 339 U.S. 162, 171-172 (1950) ("Preserva tion of the opportunity to prove actual bias is a guaran tee of a defendant's right to an impartial jury."). When the defendant's claim of bias arises from allegedly preju dicial publicity, "the appropriate safeguard against such prejudice is the defendant's right to demonstrate that the media's coverage of his case-be it printed or broadcast-compromised the ability of the particular jury that heard the case to adjudicate fairly." Smith, 455 U.S. at 217 (quoting Chandler v. Florida, 449 U.S. 560, 575 (1981)).

2. Petitioner's jury was impartial

a. Petitioner has failed to establish that any juror who decided his case was actually biased. Voir dire demonstrated that, whatever the beliefs of Houston resi dents generally, the particular individuals selected for petitioner's jury neither knew nor cared much about Enron's collapse or the resulting media coverage. See p. 12, supra (noting that nine jurors did not read the Houston Chronicle, four rarely or never watched televi sion, and ten said that they did not follow the news about Enron). The overwhelming sentiment among the seated jurors was indifference to events that did not concern them and that were by then "old news." J.A. 856a. The juror's statements thus indicated that they were emi nently "capable and willing to decide the case solely on the evidence before [them]." Smith, 455 U.S. at 217.

Petitioner's own actions during voir dire underscore the absence of actual bias among the seated jurors. Al though petitioner moved to strike eight potential jurors for cause, he did not assert such a challenge specifically to 11 of the 12 individuals who sat on the jury. Indeed, counsel for both petitioner and his co-defendant declined to ask a single question of four of the seated jurors, ap parently satisfied, after reading those jurors' question naires and hearing their responses to the court's initial inquiry, that they did not harbor any bias or partiality.

The jury's verdict confirmed its impartiality. Al though the jurors found petitioner guilty on some counts, they also found him not guilty on nine counts. The counts of acquittal, moreover, concerned allegations that petitioner had enriched himself at the expense of Enron shareholders by selling company stock based on inside information. If petitioner were correct that the jury was infected with a venomous anti-Enron senti ment, conviction on those charges, regardless of the suf ficiency of the evidence, would have served as an apt means to express the jury's purported desire for "re venge" on behalf of Houston's residents. That the jurors instead unanimously voted to find petitioner not guilty of nine insider trading charges speaks volumes about their ability, irrespective of any pretrial publicity about the case, "conscientiously [to] apply the law and find the facts" based on the evidence at trial. Lockhart v. McCree, 476 U.S. 162, 178 (1986).

b. In an effort to establish actual bias, petitioner emphasizes certain comments made by jurors whom he declined to challenge for cause. That effort, however, relies on a selective and incomplete characterization of the record. Petitioner notes, for example, that one juror expressed sympathy on his questionnaire for the "small average worker [who] saves money for retirement all his life." Pet. Br. 14. But petitioner chose not to challenge that juror (or even to ask him any questions) after the juror made clear that he "underst[oo]d that it's the gov ernment's job to prove guilt beyond a reasonable doubt" and did not have "any problem" with that requirement; that he "[v]ery seldom" read the Houston Chronicle and never watched the news; and that he had "no opinion" about the defendant's guilt. J.A. 981a-983a. Similarly, petitioner attacks another juror as biased because she stated on her questionnaire that "someone had to be doing something illegal" in connection with Enron's col lapse. Br. 14. Petitioner omits to mention, however, that at voir dire the same juror explained that "[b]ecause it never really affected [her]," she "never really paid that much attention" to news about Enron; that she "ha[d] really honestly not formed an opinion" about petitioner's guilt; and that she "[a]bsolutely" could "base [her] decision only on the evidence in the case." J.A. 1010a-1011a. Petitioner did not seek to ask that juror any questions, much less to remove her on grounds that she was biased.

Petitioner also relies heavily on certain statements of Juror 11, the one seated juror whom petitioner individu ally challenged for cause. But at trial, even though the district court granted petitioner and his co-defendant 12 peremptory challenges-six more than necessary to strike every potential juror, including Juror 11, whom counsel had unsuccessfully challenged for cause- nei ther defendant chose to strike Juror 11. In the view of trial counsel and petitioner's professional jury consul tants, Juror 11 evidently did not appear so "obvious[ly] bias[ed]" or his comments so "cartoonishly prejudicial" as petitioner now asserts. Br. 35.

In any event, the district court was correct in reject ing the claim of actual bias on the part of Juror 11. Peti tioner cites the juror's statements during voir dire that corporate CEOs are "greedy" and "walk a line that stretches sometimes the legality of something," and that he worked with a former Enron employee who lost money in his retirement plan. Pet. App. 65a-66a. As the court of appeals observed, however, Juror 11 also stated that he had "no idea" about the defendants' guilt; that he would have "no problem" telling his co-worker that the government failed to prove its case; that he did not "get into the details" of the Enron coverage; that he did not believe everything he read in the newspapers; that the defendants "earned their salaries"; that "greedy" did "not necessarily" mean "illegal"; and that he could "start this case with a clean slate that would require the gov ernment to prove its case." Id. 65a-67a; J.A. 853a-858a.

This Court has held that "ambiguous and at times contradictory" responses to voir dire examination of this kind do not alone establish actual bias. Patton, 467 U.S. at 1039. "It is sufficient if the juror can lay aside his impression or opinion and render a verdict based on the evidence presented in court." Irvin v. Dowd, 366 U.S. 717, 723 (1961). The district court, which is "best suited to determine competency to serve impartially," Patton, 467 U.S. at 1039, concluded that Juror 11 was capable of discharging that function. Because the district court's determination "is essentially one of credibility, and therefore largely one of demeanor," it is "entitled * * * to special deference." Id. at 1038 & n.14 (internal quota tion marks omitted); see Mu'Min v. Virginia, 500 U.S. 415, 428 (1991) ("A trial court's findings of juror impar tiality may be overturned only for manifest error.") (ci tation omitted). After careful review of the entire voir dire, and with an eye on the publicity surrounding this case, the district court found Juror 11 unbiased and the court of appeals properly accepted that determination.

B. Petitioner Cannot Establish A Constitutional Violation Based On Presumed Jury Prejudice

Petitioner contends that the circumstances surround ing his trial warrant a departure from the ordinary rule requiring that he establish actual bias. He argues that the publicity and impact resulting from Enron's collapse gave rise to a conclusive "presumption of juror preju dice," which compels automatic reversal. That argument lacks merit. Despite language in some opinions, this Court's holdings do not support such an irrebuttable presumption, which would conflict with well-established principles of constitutional adjudication and basic pre cepts of the jury system. In any event, even if petitioner were correct that an irrebuttable presumption of juror prejudice could be triggered in some cases, it would not be justified here.

1. This Court's decisions do not support an irrebuttable presumption of juror prejudice

Petitioner cites a number of this Court's decisions for the proposition that, when a community is exposed to a certain level of pretrial publicity, all potential jurors in that community must be presumed biased. Pet. Br. 23- 34 (citing, inter alia, Sheppard v. Maxwell, 384 U.S. 333 (1966); Estes v. Texas, 381 U.S. 532 (1965); Rideau v. Louisiana, 373 U.S. 723 (1963), and Irvin v. Dowd, su pra). In petitioner's view, that presumption is irrebuttable because jurors in such a community can neither be trusted to identify their own prejudices nor believed when they profess to be impartial.

a. The only decision in which this Court has "pre sumed" juror prejudice based solely on pretrial publicity is Rideau, and that case turned on the unique circum stance that the defendant's jailhouse confession was re peatedly televised in a small community. There, the morning after a bank employee in a small community was kidnapped and murdered, police subjected the de fendant to jail-cell questioning that resulted in his de tailed confession to the crimes. The confession was re corded and, for the next several days, a 20-minute film of the defendant in the act of confessing was aired on local television before audiences constituting as much as two-thirds of the community. 373 U.S. at 723-727. The defendant was convicted by a jury that included three members who saw and heard his confession, as well as two deputy sheriffs. Id. at 725. In light of the televised confession, this Court characterized the ensuing trial as a "kangaroo court proceeding[]." Id. at 726.

Given its unique facts, Rideau does not establish a general rule that courts may presume bias among all potential jurors whenever a particular community is exposed to heavy and adverse media coverage of events related to a crime. Indeed, the Court has yet to find a parallel to Rideau in the nearly 50 years since it was decided. As this Court has since explained, "pretrial publicity-even pervasive, adverse publicity-does not inevitably lead to an unfair trial." Nebraska Press Ass'n v. Stuart, 427 U.S. 539, 554 (1976). Rideau involved what this Court viewed as essentially an out-of-court "trial," presided over by a sheriff and conducted while the defendant was in jail and without counsel. 373 U.S. at 727. The Court's holding that it did not need to re view the voir dire transcript to say that a capital trial following the defendant's televised jailhouse confession violated due process, ibid., provides no precedent for an irrebuttable presumption of prejudice for inflammatory newspaper articles about a crime or the impact of that crime on a community.

b. The remaining cases petitioner cites provide no support for a "presumed prejudice rule." In Irvin, "the Court readily found actual prejudice" after carefully reviewing the voir dire and determining that "eight of the 12 [seated] jurors had formed an opinion that the defendant was guilty before the trial began." Murphy, 421 U.S. at 798; see Irvin, 366 U.S. at 727 (conducting an "examination of the 2,783-page voir dire record" and focusing in particular on the "voir dire examination * * * of the jurors finally placed in the jury box"); Pet. Br. 26 ("Irvin may be understood as a case addressing the actual prejudices of a particular jury."). Similarly, while Patton characterized Irwin as applying a rule of presumptive prejudice, 467 U.S. at 1031, the Court's holding in Patton was that no such presumption applied and that "[t]he relevant question is not whether the com munity remembered the case, but whether the jurors at * * * trial had such fixed opinions that they could not judge impartially the guilt of the defendant." Id. at 1035.

Petitioner describes Estes v. Texas, supra, and Sheppard v. Maxwell, supra, as holding that the defen dant need not demonstrate actual juror bias when the community is "saturated" with adverse publicity. But that is precisely the interpretation of those cases that this Court has rejected. The constitutional flaw in Estes was the "circus atmosphere" of the trial, and in Sheppard, the Court found a due process violation prin cipally because the "courthouse [was] given over to ac commodate the public appetite for carnival." Murphy, 421 U.S. at 799; see Sheppard, 384 U.S. at 355 (noting that "bedlam reigned at the courthouse during the trial and newsmen took over practically the entire court room"). This Court explained in Murphy that Estes and Sheppard "cannot be made to stand for the proposition that juror exposure to information about a state defen dant's prior convictions or to news accounts of the crime with which he is charged alone presumptively deprives the defendant of due process." 421 U.S. at 799. Those cases concern the due process implications of media presence in the courtroom, not primarily the effect of pretrial publicity on potential jurors.

Petitioner also notes several instances in which this Court has suggested that, when a community is exposed to particularly prejudicial publicity, "the jurors' claims that they can be impartial should not be believed." Pet. Br. 29 (quoting Mu'Min, 500 U.S. at 429). In the same cases, however, this Court has emphasized the heavy deference due the trial court's determination of a juror's actual impartiality. See Mu'Min, 500 U.S. at 428-429 (noting that "[a] trial court's findings of juror impartial ity may be overturned only for 'manifest error'") (cita tion omitted); see id. at 427 (emphasizing that, "[p]art icularly with respect to pretrial publicity," "primary reliance on the judgment of the trial court" to determine juror bias "makes good sense"); see Patton, 467 U.S. at 1031 (stating that although Irvin "held that adverse pre trial publicity can create such a presumption of preju dice in a community that the jurors' claims that they can be impartial should not be believed," Irvin also empha sized "that the trial court's findings of impartiality might be overturned only for 'manifest error'") (citation omitted). The statements petitioner emphasizes mean only that the district court should conduct a more searching inquiry than usual and closely scrutinize juror claims of impartiality when pretrial publicity is particu larly intense. They do not compel the conclusion that juror claims of impartiality must never be believed-and that appellate courts are bound to reverse a trial judge's contrary credibility determination-once pretrial public ity exceeds a certain threshold.

Petitioner's position runs counter to this Court's most recent pronouncement on the issue in Mu'Min. There, the Court noted that the record before it did not reflect the same kind of community sentiment described in Irvin. But the Court reasoned that, if such animosity did exist, the appropriate remedy would have been more searching voir dire, not automatic transfer or reversal. The Court explained: "Had the trial court in this case been confronted with the 'wave of public passion' engen dered by pretrial publicity that occurred in connection with Irvin's trial, the Due Process Clause of the Four teenth Amendment might well have required more ex tensive examination of potential jurors than it undertook here." Mu'Min, 500 U.S. at 429.

2. The presumption petitioner proposes would conflict with well established principles and preclude trial of the most prominent cases

a. Petitioner's proposed rule of automatic reversal in cases of exposure to high levels of pretrial publicity would conflict with this Court's "structural error" doc trine as well as with bedrock principles underlying the jury system.

This Court has explained that a rule of "automatic reversal," without an inquiry into actual prejudice, is appropriate "only in a very limited class of cases." Neder v. United States, 527 U.S. 1, 8 (1999) (internal quotation marks and citations omitted). That category is characterized by cases in which the effect of a serious error cannot be ascertained or isolated. United States v. Gonzalez-Lopez, 548 U.S. 140, 148-150 & n.4 (2006). This Court has identified only a handful of defects that qualify as such "structural error," such as a total depri vation of the right to counsel (Gideon v. Wainwright, 372 U.S. 335 (1963)); a biased trial judge (Tumey v. Ohio, 273 U.S. 510 (1927)); the race-based exclusion of grand jurors (Vasquez v. Hillery, 474 U.S. 254 (1986)); an incorrect reasonable doubt instruction (Sullivan v. Lousiana, 508 U.S. 275 (1993)); and denial of the right to be represented by retained counsel of choice (Gonza lez-Lopez, 548 U.S. at 149).

Exposure of potential jurors to intense pretrial pub licity does not qualify as a "structural error" under this framework. Indeed, as explained above, see pp. 19-21, supra, no "error" occurs at all in this context unless the voir dire reveals that such exposure actually impaired a juror's impartiality. But even if a high risk of bias among prospective jurors were itself considered a con stitutional "error," the effects of that error can be ascer tained. That is the purpose of voir dire-"to ascertain whether the juror has any bias, opinion, or prejudice that would affect or control the fair determination by him of the issues to be tried." Connors v. United States, 158 U.S. 408, 413 (1895) (emphasis added). Using the many tools at its disposal, the district court can insulate the trial from the improper influence of media coverage by ensuring-as the district court did in this case through questionnaires and searching voir dire-that individuals actually selected for the jury lack knowledge of or interest in the problematic publicity. Thus, al though this Court has recognized that the effects of ac tual bias resulting from exposure of the "petit jury" to prejudicial publicity "cannot be ascertained," see, e.g., Gonzalez-Lopez, 548 U.S. 149 n.4 (citation omitted), that rationale does not extend to potential bias arising from media coverage in the community from which the jury is drawn.

Petitioner's position rests on the premise that, when the potential jury pool has been saturated with pretrial publicity, voir dire is ineffective because "jurors in such circumstances can become infused with biases they can not recognize" or will refuse to disclose. Pet. Br. 30. But the "almost invariable assumption of the law [is] that jurors follow their instructions," Richardson v. Marsh, 481 U.S. 200, 206 (1987), even when they are exposed to prejudicial information with a far greater "psychological impact" than press reports. Pet. Br. 30; see, e.g., Watkins v. Sowders, 449 U.S. 341, 347-349 (1981) (holding effective an instruction not to consider erroneously admitted eyewitness identification evi dence). Contrary to petitioner's contention, this Court has recognized that "one who is trying as an honest [per son] to live up to the sanctity of his oath is well qualified to say whether he has an unbiased mind in a certain mat ter." Dennis, 339 U.S. at 171.

Similarly, petitioner's speculation that judges will be incapable of detecting perjury designed to conceal a ju ror's bias cannot be squared with the longstanding re spect for the expertise of trial courts in matters of jury selection. As this Court has explained, "[t]he trial judge's function * * * [during jury selection] is not unlike that of the jurors later on in the trial"; "[b]oth must reach conclusions as to impartiality and credibility by relying on their own evaluations of demeanor evi dence and of responses to questions." Mu'min, 500 U.S. at 424 (citation omitted). Indeed, this Court has said that, "[p]articularly with respect to pretrial publicity," "reliance on the judgment of the trial court" in deter mining juror impartiality "makes good sense." Id. at 427 (emphasis added).

b. The conclusive presumption of juror prejudice petitioner proposes would create serious obstacles to trial in prominent cases. To a far greater degree than in the early 1960s, when this Court decided the cases on which petitioner relies, publicity of noteworthy events and prosecutions is nationwide in scope. By its nature, media coverage carried on national networks, cable sta tions, and the Internet is not confined to the venue in which the crime is committed. If exposure to a certain level of pretrial publicity about the defendant or the events underlying trial renders a community per se un able to convene an impartial jury, as petitioner argues, then no venue will be acceptable, and no trial will be possible, in the most nationally significant cases. That cannot be the law.

3. Even if juror prejudice may be presumed in some cases, that presumption would not apply here

For three reasons, a conclusive presumption of bias among the entire jury pool would be particularly incon sistent with the realities surrounding petitioner's trial. For the same reasons, the court of appeals erred in find ing even a rebuttable presumption applicable on these facts. Pet. App. 56a-60a.

a. First, petitioner's jury was drawn from the Hous ton Division of the Southern District of Texas, which con sists of 13 counties and in 2004 had a population of at least 4.5 million people. Gov't C.A. Br. 152-153. The pop ulation of major metropolitan areas is sufficiently large, diverse, and transient that appropriate screening tech niques such as questionnaires and voir dire examination can produce an impartial jury. See Mu'Min, 500 U.S. at 429 (evaluation of effect of pretrial publicity requires consideration of "the kind of community in which the cov erage took place"); CBS, Inc. v. United States Dist. Ct. for the Cent. Dist. of Cal., 729 F.2d 1174, 1181 (9th Cir. 1984).

Because of the size and composition of the jury pool, the court of appeals erred in concluding that "the sheer number of victims" from Enron's collapse supported a presumption of jury prejudice. J.A. 58a. Contrary to the court of appeals' reasoning, the district court did not "fail[] to account for th[at] non-media prejudice" in as sessing whether Houston could yield a fair jury. Ibid. The district court was plainly aware of that potential source of bias; that is why it employed a detailed ques tionnaire that specifically asked potential jurors more than 20 questions about any contact they or anyone they knew had with Enron or the effects of its collapse. S.J.A. 9sa-13sa; id. at 12sa ("Do you know anyone * * * who has been negatively affected or hurt in any way by what happened at Enron?"). In a large urban area like Hous ton, screening devices like a questionnaire and voir dire are fully capable of identifying and eliminating from the jury pool any individual who has been influenced by me dia coverage or personally affected by the events at issue-and are fully capable of identifying 12 untainted jurors.

b. Second, the district court judge in this case was the third in the Southern District of Texas to consider claims of prejudicial pretrial publicity in an Enron-re lated prosecution and to conclude that Houston was capa ble of producing a fair and impartial jury. See United States v. Fastow, 292 F. Supp. 2d 914 (S.D. Tex. 2003); United States v. Arthur Andersen LLP, 4:02-cr-00121 Docket Entry No. 28 (S.D. Tex. Apr. 26, 2004); Hirko Venue Order. Those judges found that, contrary to peti tioner's portrayal, "for the most part, the reporting ap pears to have been objective and unemotional" with a "fact-based tone." App., infra, at 11a; Hirko Venue Or der at 6 (Enron coverage was primarily "straight news stories"). The court of appeals disagreed with that as sessment of the media coverage, citing stories that it thought were "hard to characterize as non-inflammatory, even if they were just reporting the facts." J.A. 57a. But that finding was premised on the court of appeals' incor rect application of de novo review to the question whether the circumstances surrounding trial presump tively prejudiced the community. This Court has coun seled deference to the trial court about the effect of pub licity on the jury pool. "The judge of that court sits in the locale where the publicity is said to have had its ef fect and brings to his evaluation * * * his own percep tion of the depth and extent of news stories that might influence a juror." Mu'Min, 500 U.S. at 427. Consistent with Mu'Min, this Court should respect the judgment of the three different district court judges sitting in Hous ton about the sentiment of that community and the over all nature of the press coverage there.

c. Third, the outcome of this case and others demon strated the ability of Houston jurors "conscientiously [to] apply the law and find the facts" in Enron-related crimi nal trials. Lockhart, 476 U.S. at 178 (citation omitted). In Bayly, the "first Enron criminal trial," the jury ac quitted one of the two Enron defendants. In Hirko, the jury hung on certain counts but did not vote to convict any defendant. The case was retried before a second jury, which found one of the defendants not guilty in a verdict announced within days of the verdict in peti tioner's case. And in this case, the jury deliberated for nearly five days and then found petitioner not guilty on nine counts. These results refute the suggestion that Houston jurors could not fairly consider the evidence in Enron cases or that the trial atmosphere in such pro ceedings was "utterly corrupted by press coverage." Dobbert v. Florida, 432 U.S. 282, 303 (1977) (citation omitted).

C. The Court Of Appeals Correctly Concluded That, Even If A Presumption Of Juror Prejudice Applied, The Govern ment Rebutted It On This Record

Even if petitioner were correct that some presumption of bias in the jury pool were warranted in this case, that presumption would not compel reversal of petitioner's convictions. Applying "a presumption of prejudice as op posed to a specific analysis does not change the ultimate inquiry:" whether pretrial publicity or community ani mosity resulted in actual bias on the jury that decided peti tioner's case. United States v. Olano, 507 U.S. 725, 739 (1993). Such a presumption would simply reverse the or dinary allocation of burdens in this context, relieving the defendant of the obligation to establish actual bias and requiring the government to show its absence.

Petitioner asserts that "[i]f the presumption of preju dice is rebuttable," then "the Government should be re quired to prove beyond a reasonable doubt that no seated juror was actually affected by media and community bias." Pet. Br. 34. Although the government could satisfy a burden of proof beyond a reasonable doubt here, that burden is not the appropriate one. The government bears such a burden only when it seeks to show that a constitu tional violation is harmless. See Chapman v. California, 386 U.S. 18, 24 (1967). But for the reasons set forth above, see pp. 19-21, supra, even presumptively prejudi cial exposure of potential jurors to pretrial publicity does not itself establish a constitutional violation. To the ex tent the government must rebut a presumption of preju dice among potential jurors, that requirement "is not a matter of showing that the violation was harmless, but of showing that a violation of the right * * * [to an impar tial jury did not] occur[]." Gonzalez-Lopez, 548 U.S. at 150. Because the existence of a constitutional violation turns on whether it is more likely than not that any partic ular juror was actually biased, a preponderance of the evidence standard should apply.

Applying the proper standard, the court of appeals correctly concluded that the government rebutted any presumption of bias. The district court's "exemplary" (Pet. App. 62a) jury-selection process resulted in a venire on which more than 85% of the individuals questioned said that they had no significant exposure to pretrial publicity. And for the same reasons that petitioner fails to establish actual bias among the jurors who were se lected from that venire, see pp. 21-24, supra, the govern ment can show that those jurors were impartial. The seated jurors professed either disinterest or unaware ness of the press coverage concerning Enron; they stated that they had formed no opinions about petitioner's guilt; they testified that they would hold the government to its burden of proof; and their unanimous not guilty verdicts on nine counts confirmed that the district court correctly credited their assertions.


Petitioner contends (Br. 38-58) that his conspiracy conviction is invalid because one object of the conspiracy was to violate the honest services wire fraud statute, 18 U.S.C. 1343, 1346, which petitioner argues is unconstitu tionally vague. That contention lacks merit. Section 1346 provides fair notice and ascertainable limits on the conduct it covers. The elements of the offense-a mate rial breach of the duty of loyalty, undertaken with a spe cific intent to deceive-limit the statute to two estab lished categories of conduct: bribes and kickbacks, and undisclosed personal financial conflicts of interest. Peti tioner's conduct satisfies those elements, but in any event, any error in the honest services aspect of peti tioner's conspiracy conviction was harmless beyond a reasonable doubt.

A. Section 1346 Is Not Unconstitutionally Vague

A penal statute is void for vagueness only if it fails to "define the criminal offense with sufficient definiteness that ordinary people can understand what conduct is pro hibited and in a manner that does not encourage arbi trary and discriminatory enforcement." Kolender v. Lawson, 461 U.S. 352, 357 (1983). That principle "does not invalidate every statute which a reviewing court be lieves could have been drafted with greater precision." Rose v. Locke, 423 U.S. 48, 49 (1975). Nor is a statute void for vagueness simply because "trained lawyers" must "consult legal dictionaries, treatises, and judicial opinions before they may say with any certainty" what the statute forbids. Id. at 50; see United States v. Koz minski, 487 U.S. 931, 941 (1988) (holding that in 18 U.S.C. 241, "Congress intended the statute to incorpo rate by reference a large body of potentially evolving federal law"). Constitutional vagueness concerns "rest on * * * lack of notice, and hence may be overcome in any specific case where reasonable persons would know that their conduct is at risk." Maynard v. Cartwright, 486 U.S. 356, 361 (1988). Under these standards, Section 1346 is constitutional.

1. Section 1346 reinstated the pre-McNally definition of honest services fraud

In McNally v. United States, 483 U.S. 350 (1987), this Court rejected the unanimous view of the courts of ap peals that the mail fraud statute, 18 U.S.C. 1341, pro tected against not only schemes for obtaining money or property, but also schemes to deprive others of intangi ble rights, such as the intangible right of honest services. 483 U.S. at 358; id. at 364 (Stevens, J., dissenting). The Court observed that, if Congress wished to expand fed eral fraud statutes beyond the deprivation of property rights, "it must speak more clearly than it has." Id. at 360. The following year, Congress responded by restor ing one such right (the very right at issue in McNally) through Section 1346, which states that, for purposes of the mail and wire fraud statutes, "the term 'scheme or artifice to defraud' includes a scheme or artifice to de prive another of the intangible right of honest services." 18 U.S.C. 1346; see Cleveland v. United States, 531 U.S. 12, 19-20 (2000) ("Congress amended the law specifically to cover one of the 'intangible rights' that lower courts had protected under § 1341 prior to McNally.").

"[T]he intangible right of honest services" to which Congress referred is a term of art: it invokes the doc trine that this Court had rejected in McNally and rein states it in both public and private contexts. As the Sec ond Circuit has explained, "[t]he definite article 'the' sug gests that 'intangible right of honest services' had a spe cific meaning to Congress when it enacted the stat ute-Congress was recriminalizing [mail fraud] * * * schemes to deprive others of that 'intangible right of hon est services[]' which had been protected before McNally, not all intangible rights of honest services whatever they might be thought to be." United States v. Rybicki, 354 F.3d 124, 137-138 (2003) (en banc), cert. denied, 543 U.S. 809 (2004).

2. The elements of honest services wire fraud under pre- McNally law are clearly defined

Before McNally, the deprivation of the right of hon est services was recognized as a species of fraud in both the public and the private spheres. McNally, 483 U.S. at 363-364 (Stevens, J., dissenting). The crime was exempli fied by the conduct prosecuted in McNally itself. That case involved a "self-dealing" scheme in which state offi cials (both actual and de facto) deprived the government and citizens of the right to have government affairs "con ducted honestly," by directing certain payments on state- purchased insurance to entities in which they had a finan cial interest, without any disclosure of that interest to relevant state officials. Id. at 352-353. McNally thus sets forth the paradigm case of honest services fraud that Congress intended to prohibit in Section 1346. That paradigmatic offense consists of three elements: (1) a breach of the duty of loyalty, undertaken with (2) an in tent to deceive, that also is (3) material.

a. Breach of the Duty of Loyalty. Schemes to deprive others of "the intangible right of honest services" require that a public official, agent, or other person who owes a comparable duty of loyalty breaches that duty by se cretly acting in his own financial interests while purport ing to act in the interests of his principal. See Rybicki, 354 F.3d at 141-142. Such feigned loyalty to one's princi pal is a classic form of fraud.

McNally exemplifies the equation of "honest ser vices" with the duty of loyalty, see 483 U.S. at 355; it in volved a breach based on nondisclosure of a personal fi nancial interest that might reasonably be thought to in fluence official decisionmaking. Other pre-McNally cases similarly illustrate the two general categories in volving breaches of this duty: cases involving bribes or kickbacks and cases involving official action that furthers an undisclosed conflict of interest. Section 1346 there fore does not target all manner of dishonesty but rather criminalizes only schemes in which an employee or public officer takes official action to further his own interests while pretending to act in the interests of those to whom he owes a duty of loyalty.

b. Specific Intent to Deceive. Section 1346 also has a high mens rea requirement-specific intent to de ceive-which eliminates any risk of unintentional viola tion. A "mind intent upon willful evasion is inconsistent with surprised innocence." United States v. Ragen, 314 U.S. 513, 524 (1942).

The mail and wire fraud statutes punish only schemes or artifices to "defraud," thus limiting their scope to in tentional, fraudulent conduct. See Durland v. United States, 161 U.S. 306, 313 (1986). Innocent intent is not a mere affirmative defense; the government bears the bur den of proving beyond a reasonable doubt the required intent to deceive. See, e.g., United States v. Warner, 498 F.3d 666, 691, 698 (7th Cir. 2007), cert. denied, 128 S. Ct. 2500 (2008); United States v. Alkins, 925 F.2d 541, 549-550 (2d Cir. 1991). Simple misrepresentations or omissions unaccompanied by the requisite subjective intent never amount to fraud. See United States v. Kincaid-Chauncy, 556 F.3d 923, 946 (9th Cir.), cert. de nied, No. 09-5076 (Dec. 7, 2009). Before and after McNally, courts have agreed on this point. See United States v. Sawyer, 85 F.3d 713, 732 n.16 (1st Cir. 1996) ("prior to McNally, courts endorsing the honest-services mail fraud theory invariably required some showing of deceit which is inherent in the term 'fraud'") (emphasis added).

The specific intent requirement eliminates fair notice concerns; a defendant can hardly complain of a lack of fair warning when he intends to deceive. See Colautti v. Franklin, 439 U.S. 379, 395 & n.13 (1979); Screws v. United States, 325 U.S. 91, 101-102 (1945) (plurality opin ion). Because "statutes must deal with untold and un foreseen variations in factual situations," this Court de mands "no more than a reasonable degree of certainty" and so has long held that the "presence of culpable intent as a necessary element of the offense" significantly un dermines vagueness concerns. Boyce Motor Lines, Inc. v. United States, 342 U.S. 337, 340, 342 (1952).

The intent element of Section 1346 shields a public or private defendant whose nondisclosure of a conflict oc curs because he believes that he has no conflict or disclo sure duty. A defendant cannot breach a duty that he does not know he has (even though he need not know the legal source of the duty). Nor does Section 1346 cover a fiduciary whose conflict is already known to the person or persons to whom he owes a duty of loyalty, or whose actions are otherwise taken without deceptive intent.

c. Materiality. Materiality is an element of the mail fraud offense and therefore of honest services fraud. Neder, 527 U.S. at 25. The materiality element requires that the defendant's deceptive conduct be of a kind that may influence the victim to change his behavior. Id. at 22-23. That requirement limits the offense to deceptive breaches of duty that have a sufficient level of impor tance to the victim's affairs; insignificant breaches are not actionable. See Rybicki, 354 F.3d at 146. In the pri vate sector, a misrepresentation or omission will ordi narily be material if it can cause the victim harm (eco nomic or otherwise) by inducing him to act or to refrain from acting in a particular way. In many public sector cases, such as those involving legislators, a deception will be material if it makes a difference in the way the public or other officials assess whether the office-holder has placed his self-interest above that of the public.

3. Pre-McNally honest services fraud clearly encom passed bribes and kickbacks, as well as undisclosed financial conflicts of interest furthered by official ac tion

Based on the three elements of honest services fraud, pre-McNally cases exhibit a solid consensus on two cate gories of conduct.

a. First, the acceptance of bribes or kickbacks by a public official or private employee constitutes honest- services fraud. The pre-McNally cases so holding are legion.4 No pre-McNally decision ever questioned this proposition, and post-McNally honest-services cases uniformly recognize that taking bribes and kickbacks is one of the "two principal theories" of honest-services fraud. Kincaid-Chauncey, 556 F.3d at 942; United States v. Urciuoli, 513 F.3d 290, 295 n.3 (1st Cir. 2008); United States v. Kemp, 500 F.3d 257, 279 (3d Cir. 2007), cert. denied, 128 S. Ct. 1329 (2008); United States v. Brown, 459 F.3d 509, 521 (5th Cir. 2006), cert. denied, 550 U.S. 933 (2007); Rybicki, 354 F.3d at 139-141; United States v. Woodward, 149 F.3d 46, 57 (1st Cir. 1998), cert. denied, 525 U.S. 1138 (1999). Indeed, petitioner concedes that "bribes and kickbacks were * * * paradigm cases." Pet. Br. 49. Petitioner does not assert that the courts have had any difficulty applying Section 1346 in cases involving bribery or kickback schemes, or that a reason able person could have any doubt that such schemes are covered by the statute.

Second, deprivation of honest services encompasses undisclosed self-dealing by a public official or private employee-i.e., the taking of official action by the em ployee that furthers his own undisclosed financial inter ests while purporting to act in the interests of those to whom he owes a fiduciary duty. Although not as numer ous as the bribery and kickback cases, the pre-McNally cases involving undisclosed self-dealing were abundant.5 Indeed, the theory of liability in McNally itself was nondisclosure of a conflicting financial interest. 483 U.S. at 355 (jury instructions required a finding that actual or de facto officials used authority to direct commissions on state-purchased insurance to entities in which they had an ownership interest "without disclosing that interest to persons in state government whose actions or delibera tions could have been affected by the disclosure"); id. at 361 n.9 ("The violation asserted is the failure to disclose their financial interest."). Congress clearly intended to revive the nondisclosure theory invalidated in McNally itself.

b. Petitioner argues that, if his facial vagueness chal lenge is rejected, Section 1346 should be strictly limited to cases involving bribes and kickbacks to "avoid[] redun dancy with traditional money or property fraud." Br. 49. Petitioner's argument assumes that an employee's ac ceptance of a bribe or kickback does not ordinarily de prive his employer of money or property, whereas self-dealing schemes are "effectively money or property fraud cases anyway." Br. 51.

Pre-McNally non-disclosure cases refute petitioner's argument. McNally, the decision Section 1346 was writ ten to reverse, described the scheme at issue as involving "self-dealing," while making clear that it involved no showing that the state "was defrauded of any money or property." 483 U.S. at 352, 360. See also, e.g., United States v. Keane, 522 F.2d 534 (7th Cir. 1975) (city alder man bought properties through nominees and voted on matters that favorably affected the properties without disclosing his interest), cert. denied, 424 U.S. 976 (1976); United States v. O'Malley, 707 F.2d 1240 (11th Cir. 1983) (insurance commissioner steered insurance companies to use law firm in which he had an interest). In these cases and others involving self-dealing, the scheme will not necessarily deprive the persons to whom a duty is owed of money or property.

Even petitioner's more modest proposal to limit self- dealing schemes to the direction of money or property to third parties in which the official has an undisclosed in terest, Br. 52 n.14, is flawed. For example, a vote to rezone property, when the public official secretly owns property interests in that location, involves no govern ment expenditures to a third party. Nor does a legisla tor's voting down a tax increase to benefit the interests of a party from whom the legislator is soliciting employ ment involve expenditures. Yet both forms of undis closed self-dealing are core honest services frauds.

4. Neither pre-McNally decisional conflicts nor the gov ernment's litigation positions render Section 1346 un constitutionally vague

Petitioner incorrectly claims (Br. 39-44) that conflicts in pre-McNally case law and the history of government prosecutions create uncertainty about the reach of the honest services statute.

a. Petitioner significantly overstates the extent to which the courts of appeals differed about the scope of an honest services offense before McNally. Most impor tantly, petitioner identifies no disagreement about the core elements that constitute the statutory violation, as discussed above. And even as to the peripheral issues petitioner raises, the disagreement was not so severe as to render the statute void on its face.

Whether a Violation of State Law Is Required. Be fore McNally, the courts of appeals agreed that an hon est-services conviction need not be based on a violation of state law. See, e.g., United States v. Mandel, 591 F.2d 1347, 1361 (4th Cir.), vacated, 602 F.2d 653 (4th Cir. 1979), cert. denied, 445 U.S. 961 (1980); see McNally, 483 U.S. at 355 (citing Mandel as illustrative of courts of ap peals' honest-services jurisprudence); id. at 377 n.10 (Stevens, J., dissenting) (citing Mandel and other deci sions holding that the mail fraud statute forbids schemes that do not violate state law). In McNally itself, the Court recognized that the theory of liability at issue pos ited a nondisclosure violation "even if state law did not require [disclosure]." Id. at 361 n.9. Although United States v. Rabbitt, 583 F.2d 1014, 1026 (8th Cir. 1978), cert. denied, 439 U.S. 1116 (1979), mentioned in passing the absence of an affirmative disclosure duty under state law as a factor in reversing a conviction, the Eighth Cir cuit had previously recognized that "[t]he fact that a scheme may or may not violate State law does not deter mine whether it is within the proscriptions of [Section 1341]." United States v. McNeive, 536 F.2d 1245, 1247 n. 2 (1976) (citation omitted).

Whether Contemplated Economic Harm Was Re quired. As the government's brief explained in Black v. United States, No. 08-8768, at 28-34, only one pre- McNally outlier held that the honest services offense had a distinct element of contemplated economic harm. United States v. Lemire, 720 F.2d 1327, 1337 (D.C. Cir. 1983), cert. denied, 467 U.S. 1226 (1984). Most cases treated contemplated harm as a natural facet of material ity and did not state that the harm had to be "economic." See United States v. Feldman, 711 F.2d 758, 763 (7th Cir.), cert. denied, 464 U.S. 939 (1983); United States v. Ballard, 663 F.2d 534, 540 (5th Cir. 1981), modified on reh'g, 680 F.2d 352 (5th Cir. 1982); United States v. Von Barta, 635 F.2d 999, 1005 n.14 (2d Cir. 1980), cert. de nied, 450 U.S. 998 (1981); Epstein, 174 F.2d 754, 768 (6th Cir. 1949). And even Lemire believed that its formula tion "only makes more explicit what [other courts] meant by a 'material non-disclosure or misrepresentation.'" 720 F.2d at 1337.

Whether Private- and Public-Sector Honest Services Fraud Had the Same Elements. The cases petitioner cites establish nothing more than the uncontroversial proposition that the duties of loyalty for private and pub lic officials may be distinct and that what is material may correspondingly differ. See Lemire, 720 F.2d at 1337 n. 13 ("[p]ublic officials may be held to a higher standard of public trust"). United States v. Price, 788 F.2d 234 (4th Cir. 1986), vacated sub nom. McMahan v. United States, 483 U.S. 1015 (1987), did not disagree; it held only that in a private-sector case involving elected labor union offi cials, the public-sector standard was the better fit.

Whether Honest Services Violations Require Official Action. Contrary to petitioner's contention, courts did not disagree on whether honest-services violations re quire "official action." Misuse of official position was clearly required for a breach of the duty of loyalty. Con sistent with that principle, the court in Rabbitt reasoned that a state legislator did not commit honest-services fraud by recommending an architectural firm for state business when his official duties did not include awarding state contracts to architects, and when he had not in any way used the powers of his office to advance the con tracts. 583 F.3d at 1026. In United States v. Bush, 522 F.2d 641(7th Cir. 1975), cert. denied, 424 U.S. 977 (1976), the court upheld the honest-services conviction of the press secretary of the Chicago mayor, reasoning that the press secretary had violated his duty of loyalty by "us[ing] his official position" within the mayor's "inner circle" to influence a contract decision. Id. at 647. The holdings of the two cases were not different in principle; in Bush the court merely found that the defendant had used his official position in a way the defendant in Rabbit had not. That sort of fact-specific variation is hardly pe culiar to the honest services fraud statute.

Whether a Misuse of Fiduciary Position Is Required. Before McNally, honest services cases consistently re quired breaches of fiduciary duties. Petitioner cites United States v. Bronston, 658 F.2d 920, 926 (2d Cir.), cert. denied, 456 U.S. 915 (1981), for its statement that the defendant's "use[]" of his "fiduciary relationship" was not a prerequisite to conviction. Id. at 926. But the court found that the defendant had "breach[ed] his fiduciary duty" to his law firm's client by concealing his represen tation of a client with conflicting interests, and it held only that no further showing was necessary that the law yer misused information from the law firm's client. Id. at 929. In any event, the court found that the evidence sup ported "an inference that such activity occurred." Ibid.

b. Petitioner asserts that in the lower courts here, as well as in other cases, the government has advanced posi tions concerning the nature of honest services fraud that differ from its position in this Court. Br. 42-44. That assertion does not establish any constitutional infirmity in the honest services statute. As lower courts address and resolve issues of statutory construction, and until the Solicitor General has had occasion to adopt a formal posi tion, the government may over time make different argu ments concerning the scope or meaning of a statute. That type of development occurring in the course of han dling cases involving distinctive fact patterns or raising legal issues of first impression is an ordinary incident of the litigation process, and it does not suggest that the statute is unconstitutionally vague. As the Second Cir cuit reasoned in rejecting a vagueness challenge, "[p]rosecutors sometimes make mistakes as to the reach of criminal statutes; courts correct them." Rybicki, 354 F.3d at 143.

B. Petitioner Conspired To Commit Honest Services Wire Fraud

Although petitioner's prosecution did not involve the prototypical secret, outside conflicting financial interests that are characteristic of nondisclosure honest services cases, the conduct petitioner conspired to commit consti tutes honest services wire fraud under the principles outlined above.

1. Petitioner had, and acted upon, his personal finan cial interests, which conflicted with those of the share holders to whom he owed a fiduciary duty. The company and its shareholders attempted to align their long-term interests with petitioner's by linking his compensation to stock price. But the obvious premise of that arrange ment was that petitioner would act to maximize share holder wealth. Petitioner subverted that premise, and placed his interests in conflict with that of the sharehold ers, when, for his own financial benefit, he engaged in an undisclosed scheme to artificially inflate the stock's price by deceiving the shareholders and others about the com pany's true financial condition. That conduct constituted fraud. The only question here is whether the public na ture of petitioner's compensation scheme prevents his conduct from constituting honest services fraud. It does not. Although petitioner's basic compensation scheme was public, his scheme to artificially inflate the com pany's stock price by misrepresenting its financial condi tion, in order to derive additional personal benefits at the expense of shareholders, was not. Petitioner's deception deprived shareholders of the information they needed to make informed decisions and thereby defrauded them of his honest services.

2. Petitioner argues that the government was re quired but failed to prove as an element of the wire fraud statute that he acted for private gain. That argument is incorrect both legally and factually.

As a legal matter, the critical element is the defen dant's undisclosed personal conflicting financial inter ests furthered by official action, not the defendant's sub jective motive. No pre-McNally court of appeals deci sion, whether in a public- or a private-sector case, held that intended private gain was an element of honest-ser vices fraud. To be sure, the vast majority (if not all) pre- McNally honest-services cases did involve self-enrich ment schemes. But, as the Seventh Circuit observed be fore McNally, "[w]hile most cases have involved some financial gain to the one breaching his fiduciary duty, they have not required financial gain." United States v. Dick, 744 F.2d 546, 551 (7th Cir. 1984) (emphasis in origi nal). "[T]he notion of misuse of office for personal gain adds little clarity to the scope of § 1346," but instead "adds [only] an extra layer of unnecessary complexity to the inquiry." United States v. Panarella, 277 F.3d 678, 692 (3d Cir.), cert. denied, 537 U.S. 819 (2002).6

As a factual matter, the indictment alleged, and the evidence at trial showed, that petitioner's scheme re sulted in immense private gain. In a section entitled "De fendants' Profit as a Result of the Scheme," the conspir acy count expressly enumerated the ways in which peti tioner profited from the fraudulent scheme: through the receipt of salary and bonuses, which were tied to Enron's stock price, and through the sale of approximately $200 million in Enron stock, which netted him $89 million. J.A. 280a-281a. Far from conceding that petitioner sought to further Enron's "best interests," as petitioner erroneously asserts (Br. 57), the government explained in its opening statement that the honest-services fraud scheme entailed private gain to the conspirators from the sale of Enron stock:

[T]hese two men [petitioner and Lay] chose to violate their duties of loyalty and trust by lying over and over again about the true financial condition of Enron, concealing from [the] employees and investors information which was critical for them to make good decisions about what to do with their own stock; and at the same time, they repeatedly put their own inter ests in front of those investors by self-dealing, by sell ing their own stock.

R. 14758. At trial, petitioner stipulated that he repeat edly sold multi-million dollar quantities of his Enron holding during the course of the fraudulent scheme, see R. 25211-25214-sales that enabled him to benefit from the artificially inflated stock price. The conduct proved in this case thus satisfies any statutory requirement of private gain.

C. Any Error In The Honest Services Fraud Object Was Harmless Beyond A Reasonable Doubt

Even if this Court were to find error in the honest services object of the conspiracy, any juror who voted for conviction based on that object also would have found petitioner guilty of conspiring to commit securities fraud. Therefore, any error was harmless.

1. In Yates v. United States, 354 U.S. 298 (1957), this Court held that when one of the objects of a multi-object conspiracy count is legally invalid, the conspiracy convic tion is constitutionally flawed. Like other instructional defects, however, a Yates violation is subject to harmless error analysis. See, e.g., Neder, supra; California v. Roy, 519 U.S. 2 (1996) (per curiam); Pope v. Illinois, 481 U.S. 497 (1987); Rose v. Clark, 478 U.S. 570 (1986). This Court has so held in the collateral review context, Hedgpeth v. Pulido, 129 S. Ct. 530 (2008) (per curiam), and the same principle applies on direct review.

2. The jury instructions on the honest services object required the jurors to find that the scheme to defraud "employed false material representations." R. 36423. The misrepresentations alleged in the indictment and relied on by the government at trial consisted of peti tioner's statements about the financial condition of Enron and its various components. Any juror who found that petitioner committed honest services fraud must therefore have found that he made those statements and that they were false. Those same misstatements pro vided the basis for the securities fraud object of the con spiracy. Thus, any juror finding that the government proved the honest services object of the conspiracy also would have found that the government proved the securi ties fraud object. Similarly, the jury necessarily found that petitioner had committed the conduct underlying the securities fraud object because it found him guilty on the 12 substantive securities fraud counts, which were based on many of the same misrepresentations that formed the basis for the conspiracy charge. Accordingly, the jury's verdict on the conspiracy count would have been the same without the honest-services theory. Neder, 527 U.S. at 17.


The judgment of the court of appeals should be af firmed.

Respectfully submitted.

Solicitor General
Acting Assistant Attorney
Deputy Solicitor General
Assistant to the Solicitor


1 Judge Hittner later ordered a venue transfer to Brownsville, Texas, after Fastow confessed in a failed guilty plea allocution that was widely reported in Houston. Venue Response 18 n.8.

2 Petitioner and Lay renewed the venue transfer motion on January 4, 2006, after Causey pled guilty. The district court again denied the motion, essentially for the reasons set forth in its earlier order. Order (Jan. 23, 2006).

3 Petitioner also contends (Br. 34) that, independent of the Constitu tion, this Court should exercise its "inherent supervisory power" to reverse his convictions. Because petitioner did not assert that argument below, the court of appeals did not address it, and it is not properly before this Court. In any event, there is no warrant for this Court to use its supervisory authority to establish a new and different impartiality rule. See United States v. Payner, 447 U.S. 727, 737 (1980) (holding that supervisory authority does not "confer on the judiciary discretionary power to disregard the considered limitations of the law it is charged with enforcing").

4 See, e.g., United States v. Lovett, 811 F.2d 979 (7th Cir. 1987); United States v. Bruno, 809 F.2d 1097 (5th Cir.), cert. denied, 481 U.S. 1057 (1987); United States v. Price, 788 F.2d 234 (4th Cir. 1986), vacated sub nom. McMahan v. United States, 483 U.S. 1015 (1987); United States v. Schwartz, 785 F.2d 673 (9th Cir.), cert. denied, 479 U.S. 890 (1986); United States v. Qaoud, 777 F.2d 1105 (6th Cir. 1985), cert. denied, 475 U.S. 1098 (1986); United States v. Bonansinga, 773 F.2d 166 (7th Cir. 1985), cert. denied, 476 U.S. 1160 (1986); United States v. Murphy, 768 F.2d 1518 (7th Cir. 1985), cert. denied, 475 U.S. 1012 (1986); United States v. Conner, 752 F.2d 566 (11th Cir.), cert. denied, 474 U.S. 821 (1985); United States v. Alexander, 741 F.2d 962 (7th Cir. 1984); United States v. Venneri, 736 F.2d 995 (4th Cir.), cert. denied, 469 U.S. 1035 (1984); United States v. Gorny, 732 F.2d 597 (7th Cir. 1984); United States v. Gann, 718 F.2d 1502 (10th Cir. 1983), cert. denied, 469 U.S. 863 (1984); United States v. Whitt, 718 F.2d 1494 (10th Cir. 1983); United States v. Primrose, 718 F.2d 1484 (10th Cir. 1983), cert. denied, 466 U.S. 974 (1984); United States v. Pecora, 693 F.2d 421 (5th Cir. 1982), cert. denied, 462 U.S. 1119 (1983); United States v. Washington, 688 F.2d 953 (5th Cir. 1982); United States v. Boffa, 688 F.2d 919 (3d Cir. 1982), cert. denied, 465 U.S. 1066 (1983); United States v. Margiotta, 688 F.2d 108 (2d Cir. 1982), cert. denied, 461 U.S. 913 (1983); United States v. Bottom, 638 F.2d 781 (5th Cir. 1981); United States v. Bohonus, 628 F.2d 1167 (9th Cir.), cert. denied, 447 U.S. 928 (1980); United States v. Mandel, 591 F.2d 1347 (4th Cir.), vacated, 602 F.2d 653 (4th Cir. 1979) (per curiam), cert. denied, 445 U.S. 961 (1980); United States v. Craig, 573 F.2d 455 (7th Cir. 1977), cert. denied, 439 U.S. 820 (1978); United States v. Rauhoff, 525 F.2d 1170 (7th Cir. 1975); United States v. Bryza, 522 F.2d 414 (7th Cir. 1975), cert. denied, 426 U.S. 912 (1976); United States v. Barrett, 505 F.2d 1091 (7th Cir. 1974), cert. denied, 421 U.S. 964 (1975); United States v. Staszcuk, 502 F.2d 875 (7th Cir. 1974), cert. denied, 423 U.S. 837 (1975) ; United States v. Isaacs, 493 F.2d 1124 (7th Cir.), cert. denied, 417 U.S. 976 (1974); United States v. George, 477 F.2d 508 (7th Cir.), cert. denied, 414 U.S. 827 (1973); Shushan v. United States, 117 F.2d 110 (5th Cir.), cert. denied, 313 U.S. 574 (1941).

5 See United States v. Kwiat, 817 F.2d 440 (7th Cir.), cert. denied, 484 U.S. 924 (1987); United States v. Holzer, 816 F.2d 304 (7th Cir.), vacated, 484 U.S. 807 (1987); United States v. Dick, 744 F.2d 546 (7th Cir. 1984); United States v. Siegel, 717 F.2d 9 (2d Cir. 1983); United States v. Feldman, 711 F.2d 758 (7th Cir.), cert. denied, 464 U.S. 939 (1983); United States v. Ballard, 663 F.2d 534 (5th Cir. 1981), modified on reh'g, 680 F.2d 352 (5th Cir. 1982); United States v. Von Barta, 635 F.2d 999 (2d Cir. 1980), cert. denied, 450 U.S. 998 (1981); United States v. McCracken, 581 F.2d 719 (8th Cir. 1978); United States v. Brown, 540 F.2d 364 (8th Cir. 1976); United States v. Bush, 522 F.2d 641 (7th Cir. 1975), cert. denied, 424 U.S. 977 (1976); United States v. Keane, 522 F.2d 534 (7th Cir. 1975), cert. denied, 424 U.S. 976 (1976); Post v. United States, 407 F.2d 319 (D.C. Cir. 1968), cert. denied, 393 U.S. 1092 (1969); Epstein v. United States, 174 F.2d 754 (6th Cir. 1949).

6 Petitioner relies (Br. 53-55) on cases describing the honest services offense as involving private gain-as did McNally itself, 483 U.S. at 355. But that descriptive language does not create an element. Even in United States v. Dixon, 536 F.2d 1388 (2d Cir. 1976), what was missing was a conflict of interest of any kind. And Judge Friendly's observation that use of "a private fiduciary position to obtain direct pecuniary gain is within the mail fraud statute," id. at 1399, does not establish that it is required by the mail fraud statute.

Updated February 4, 2016