Kelly v. United States and the need to define "property" in the Mail Fraud Statute. The Court can no longer delay with the explanation, "We'll cross that bridge when we come to it."
by: Don Samuel
The Bridgegate case – Kelly v. United States – was argued in the Supreme Court in January and is awaiting decision. The facts of the case, viewed through the prosecutors’ lens, begins with three state employees deciding that it was time to punish the mayor of Fort Lee, NJ for his failure to support Governor Christie in his reelection bid. The punishment was actually inflicted on the citizens of Fort Lee: Two of the three customary lanes of eastbound traffic that were used by Fort Lee residents to enter the George Washington Bridge during morning rush hour were converted to traffic coming from another location. The resulting traffic jams backing into the City of Fort Lee were monumental.
The three state employees claimed that the lanes were closed in order to conduct a traffic pattern study. This was false. Did they commit mail and wire fraud in violation of 18 U.S.C. §1341 and § 1343? They did not receive a bribe or a kickback, so their conduct did not amount to honest services fraud, 18 U.S.C. § 1346. So to amount to federal fraud, the conduct must have been a scheme to deprive the victim of property or money.
According to the indictment the defendants lied (the reason for the lane closure) and the victim (the Port Authority) was deprived of property (the proper use of the traffic lanes; and the wages paid to toll booth collectors who were required to work overtime to accommodate the increased traffic).
Those are the elements of the offense that must be proven, but the dispute in the Supreme Court focused primarily on whether the Port Authority was deprived of property (either tangible or intangible).
The defendants, in the Supreme Court, argued that the Port Authority was not deprived of property and this was nothing more than an illegitimate “honest services fraud” prosecution in disguise. The lanes of traffic were still owned by the Port Authority and the lanes of traffic were still being used by the public, albeit not by the beleaguered citizens of Fort Lee. Only the “motive” for the lane closure was a lie and the motive for politicians’ decisions are often a mixed bag (and not honestly revealed): there are always political considerations to every decision (as Mick Mulvaney candidly implored, “Get over it”).
The government responds that the defendants “commandeered” the lanes of traffic and that this is no different than a government employee who directs city employees to paint a private citizen’s house or mow the lawn of the government employee. That is property fraud: taking the time of the city employees away from their legitimate tasks. Taking the paint and the lawn mower away from the public use to which the paint and lawn mower are supposed to be devoted.
“No,” respond the defendants, “it is more akin to telling a snowplow driver first to plow the mayor’s street, then the streets of the city councilmen who belong to the favored political party, and at the end of the day, the streets of the councilmen who belong to the disfavored political party. And that command, though distasteful, is not property fraud.”
The prosecutor replies: “If you want to use the snowplow hypothetical, it would be more apropos to consider a defendant who pushes the snowplow driver away from the steering wheel and drives the snowplow to the defendant's street, while the real snowplow driver is incapacitated.”
The oral argument did not do much to clarify this issue. What if, the Court asked, one lane of traffic was redirected to the front of the mayor’s privately-owned hotel, or restaurant so that more drivers would patronize his private businesses? Is that a deprivation of the port authority property? Is that federal property fraud, assuming there is a false statement offered for the reason (and a mailing)? Surely it is an abuse of power, but is that federal fraud?
The government, in its brief, concedes that lying about a politician’s motive for any decision is not mail fraud (#GetOverIt). But commandeering property is fraud. It is not fraud for the employee to give a false reason for instructing the snowplow driver to start at the mayor’s street. But it is fraud to redirect lanes of traffic based on a non-existent traffic study.
The point may be this: if the defendant had the authority to initiate a traffic study and, in fact, did so, then any false statement he makes about his motive for doing so is not federal fraud. But if there was, in fact, no traffic study at all (or, perhaps, the defendant had no authority to initiate a traffic study), then it is fraud to direct that the lanes be closed and explain, later, that it was because of a traffic study.
The defendants parry this argument, too, arguing that the defendants had the authority to redirect traffic patterns, and whether they did so because of a faux traffic study, or not, is not the difference between guilt and innocence: they had the authority to redirect traffic and the fact that they had no interest in actually studying the traffic is irrelevant. They directed the Port Authority to redirect traffic and, having done so (and having not deprived the Port Authority of any property), the reason that they redirected traffic is the type of “motive” evidence that the government conceded was not a basis for a federal fraud prosecution. Perhaps the government is, in fact, resurrecting honest services fraud. Perhaps this is a bridge too far.