United States v. Stephen Stockman ( 2020 )

Case: 18-20780 Document: 00515267269 Page: 1 Date Filed: 01/10/2020
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
January 10, 2020
No. 18-20780
Lyle W. Cayce
Clerk
UNITED STATES OF AMERICA,
Plaintiff - Appellee
v.
STEPHEN E. STOCKMAN,
Defendant - Appellant
Appeal from the United States District Court
for the Southern District of Texas
Before JOLLY, GRAVES, and HIGGINSON, Circuit Judges.
E. GRADY JOLLY, Circuit Judge:
Stephen E. Stockman served four years in Congress and now faces ten
years in prison. He seeks to avoid this career detour. He must admit that a
jury convicted him on twenty-three felony counts after the government accused
him, inter alia, of defrauding philanthropists and using their money to finance
his personal life and political career. Acknowledging the convictions,
Stockman argues, nevertheless, that prison should not be the next item on his
résumé because the convictions were tainted by improper jury instructions and
unsupported by the evidence. We affirm.
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I.
Stockman served two nonconsecutive terms in the United States House
of Representatives, first from 1995 to 1997 and then from 2013 to 2015. During
his first term, Stockman began working with an organization called the
“Leadership Institute,” where he became acquainted with Jason Posey and
Thomas Dodd, two members of its staff. His relationships with these two men
would grow and then wither. Stockman employed Posey and Dodd as
campaign staffers, congressional aides, and business consultants. Their most
recent roles were as witnesses against Stockman.
Posey and Dodd worked with Stockman to raise money for various
“nonprofit” entities between 2010 and 2014, the period in which Stockman is
alleged to have orchestrated a criminal scheme to obtain charitable donations
under false pretenses and to then enrich himself with the proceeds. Though
initially named as codefendants, Posey and Dodd abandoned Stockman,
pleaded guilty, and testified against him. Their testimony helped reveal the
details of the scheme, which unfolded in four parts, targeted two donors, and
ultimately netted over a million dollars for Stockman and his aides.
The 2010 Rothschild Donations
Stockman’s scheme began in May 2010, when Stockman and Dodd
started soliciting Stanford Z. Rothschild, Jr., an elderly donor acting through
his foundation. Over the next five months, Stockman and Dodd managed to
persuade Rothschild to donate $285,000 to the Ross Center, a Section 501(c)(3) 1
nonprofit organization under Stockman’s control. Rothschild was told that his
money would fund “voter education material” for Jewish voters in Florida.
Dodd testified that “voter education material[s]” are print publications that
1 This case involves so-called “501(c)(3)” and “501(c)(4)” organizations. Those
designations refer to provisions of the Internal Revenue Code that give tax-exempt status to
qualifying nonprofit entities. See 26 U.S.C. §§ 501(c)(3)–(4).
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“educate voters in the general public about public policy positions and public
policy issues.” Specifically, Rothschild was pitched on a book about radical
Islam that would be mailed to voters in the lead-up to the 2010 midterm
elections.
The deal was finalized only after Stockman assured Rothschild that his
money “was to be spent for public policy [and] voter education that was 100
percent compliant with 501(c)(3) rules.” With this reference to the “501(c)(3)
rules,” Stockman appears to have promised that he would spend Rothschild’s
money primarily (if not exclusively) in furtherance of the educational goals laid
out in the pitch. See 26 U.S.C. § 501(c)(3) (tax-exempt organizations must be
operated “exclusively for . . . charitable . . . or educational purposes”).
But this promise soon vanished. Instead of “voter education materials,”
Stockman spent the 2010 Rothschild funds charitably on himself, educating
himself at Disneyland and other amusement parks, at spas, and riding in hot
air balloons. Stockman’s charity to himself was generous; it further included
paying his business expenses, including an abortive venture in South Sudan
on which Stockman spent about $13,000 of the 2010 Rothschild funds.
Stockman made the trip to South Sudan hoping to win a lucrative lobbying
contract with a “performance bonus” that would allow him to take a percentage
of any foreign aid appropriated by Congress.
Stockman failed to mail any “voter education material” as promised.
The 2011–2012 Rothschild Donations
Stockman and Dodd were not finished with Rothschild. In 2011,
Stockman decided to run for a second term in Congress. This time, rather than
pitch a “voter education” project aimed at indirectly influencing elections,
Stockman and Dodd requested a loan for Stockman’s campaign. Rothschild
refused. Instead, he agreed to give in the same manner as before, i.e., to
“mak[e] donations from his foundation . . . to be used for voter education in
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accordance with the 501(c)(3) rules.” Stockman again promised to honor
Rothschild’s wishes, so Rothschild made another series of large donations, this
time totaling $165,000, to the Ross Center and Life Without Limits (another
Stockman-controlled nonprofit entity).
As before, Stockman repurposed the funds. He spent thousands on
personal goods, including airline tickets, fast food, and gasoline. He also
diverted 80% of a $100,000 donation to his congressional campaign account. It
was later reported to the Federal Election Commission (FEC) that this deposit
was a personal loan from Stockman to his own campaign.
Stockman agrees that most of the 2011–2012 Rothschild funds were, in
the words of his brief, “transferred to other accounts controlled by Stockman,
including the account for his campaign committee.” Stockman nevertheless
reported in a letter to Rothschild that the funds had “helped [Life Without
Limits] educate many people last year in traditional American values.” The
nature of those “values” was not described.
The 2013 Uihlein Donation
In January 2013, Stockman, now a member of Congress, shifted his
attention to Richard Uihlein, a Wisconsin businessman whose foundation has
donated millions of dollars to nonprofit organizations that share his
conservative values. Stockman and Dodd pitched Uihlein on “Freedom House,”
a prospective residential facility in Washington, D.C. that would house interns
and provide a home base for a non-existent nonprofit called the “Congressional
Freedom Foundation.” Uihlein agreed to endow the project with $350,000 in
seed money. The seed was not planted as promised, and the project died in
silence. But the seed money survived to promote a new development in
Stockman’s political career: he had decided to run for the United States Senate
in 2014.
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Thus, as with the Rothschild donations, Stockman used the 2013 Uihlein
funds to meet his personal and (especially) his political needs. For example,
Stockman spent over $40,000 on a plan to surveil a conservative Texas
politician whom Stockman believed to be a likely opponent in a future primary.
Stockman also gave thousands of dollars to his cohorts, Dodd and Posey, so
that they, in turn, could “donate” the money to Stockman’s Senate campaign;
the donations were falsely attributed to Dodd’s mother and Posey’s father in
FEC filings. In sum, the 2013 Uihlein donation was spent in a long sequence
of varying expenditures, including $5,000 to pay the rent on Stockman’s
campaign office, more than $30,000 to pay off Dodd’s credit card debt, and over
$20,000 to patronize a publishing business owned by Stockman’s brother.
Posey testified that no money was actually spent on the project pitched
to Uihlein. Even Stockman agrees that no property was ever acquired for such
a project. Nonetheless, Stockman’s team reported to Uihlein that his
generosity had allowed Life Without Limits to support Freedom House. The
2014 letter that makes this claim also goes on to advise Uihlein that his
“continued support is crucial to our mission.”
The 2014 Uihlein Donation
By early 2014, Stockman was in the midst of his primary challenge to
incumbent United States Senator John Cornyn. Stockman met with Kurt
Wagner, the president of a direct mail company, and the two men discussed
Stockman’s plan to mail Texas voters a faux newspaper called The
Conservative News on the eve of the Republican primary. The Conservative
News accuses Senator Cornyn of “falsifying ethics reports to hide income,”
“lying to voters,” and filing “false donor reports at least 121 times.” By
contrast, The Conservative News takes care to highlight Stockman’s policy
positions and legislative actions with bold headlines like “Stockman Kills
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Cornyn-Backed Senate Amnesty Bill” and “Stockman’s Sanctity of Life Act
Overturns Roe v. Wade.”
To finance this direct mail campaign, Stockman instructed Wagner to
seek a new donation from Uihlein. Posey also called Uihlein to help induce a
donation. Stockman dictated some of the contents of a solicitation letter but
told Wagner that the letter would “need[] to come from somebody else, not
[Stockman] directly.” The letter, which purported to seek financing for an
independent expenditure by the “Center for the American Future,” induced
Uihlein to give $450,571.65. Uihlein testified that he would not have donated
the money if he had known of Stockman’s involvement. Posey testified that
the Center for the American Future was under Stockman’s control.
The 2014 Uihlein funds were used to print and distribute hundreds of
thousands of copies of The Conservative News. Stockman called off the direct
mail campaign shortly before the primary, at which point only $214,718.51
remained of Uihlein’s 2014 donation. At Stockman’s direction, Posey
proceeded to use these remaining funds to pay bills related to Stockman’s
Senate campaigns, including both his Texas campaign and a prospective
campaign in Alaska. Posey also testified that Stockman instructed him to flee
to Egypt with some of the remaining funds, using them to pay for flights and
other travel expenses. 2
II.
In March 2017, Stockman was indicted on four counts of mail fraud, four
counts of wire fraud, two counts of making false statements in FEC filings,
eleven counts of money laundering, one count of conspiracy to make conduit
2 By this time, Stockman had wind that he was the target of an FBI investigation. He
thought that, by sending Posey to Cairo with the 2014 Uihlein funds, he could evade a
potential asset freeze or forfeiture.
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campaign contributions and false statements, one count of causing an
excessive campaign contribution, and one count of filing a false tax return.
The district court denied Stockman’s motions to dismiss the indictment
and to strike surplusage. The case proceeded to a three-week jury trial, after
which Stockman was convicted on all counts but one. 3 The district court denied
Stockman’s motions for judgment of acquittal, and later sentenced Stockman
to ten years in prison and three years of supervised release. Stockman was
also ordered to pay restitution in the amount of $1,014,718.51. He timely has
appealed.
III.
Stockman now argues that the district court erred by issuing problematic
jury instructions, by denying Stockman’s motions for judgment of acquittal
under Federal Rule of Criminal Procedure 29, and by denying his motion to
dismiss the indictment. With respect to the jury instructions, Stockman
contends that the district court erred by defining 501(c)(3) and 501(c)(4)
organizations in the charge and by failing to instruct the jury on Stockman’s
“good faith” defense to the tax and campaign finance counts. With respect to
the denial of his Rule 29 motions, Stockman argues that the government failed
to prove the existence of a fraudulent “scheme” devised with the requisite
intent to defraud. Stockman also makes three arguments challenging his
conviction for causing an excessive campaign contribution under Count 12 of
the indictment, all of which essentially assert that the district court erred by
failing to recognize that “express advocacy” is a necessary element of the
3 Stockman was acquitted on Count 6, a wire fraud charge related to the Rothschild
donations.
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offense. In total, Stockman’s brief presents six alleged errors infecting one or
more of his convictions. 4 We find that each claim lacks merit.
A.
Stockman argues that his convictions for mail and wire fraud cannot
stand because the district court issued “improper and unnecessary”
instructions that confused the jury. Specifically, Stockman draws our
attention to a section of the jury charge that defines 501(c)(3) and 501(c)(4)
organizations in the following manner:
A 501(c)(3) organization is a nonprofit corporation, fund, or foundation
organized and operated exclusively for religious, charitable, scientific,
or educational purposes.
Section 501(c)(3) organizations are generally exempt from federal
taxation, and donations to [] these entities may be tax deductible. If an
organization is classified as a 501(c)(3) organization, none of its net
earnings may benefit any private shareholder or individual. A Section
501(c)(3) organization may not participate or intervene in any political
campaign on behalf of or [in] opposition to any candidate for public
office.
A Section 501(c)(4) organization is a nonprofit organization operated
exclusively for the promotion of social welfare. . . . Section 501(c)(4)
organizations are also generally exempt from federal taxation. A
Section 501(c)(4) organization may compensate employees for work
actually performed, but the net earnings of a Section 501(c)(4)
organization must be devoted exclusively to charitable, educational, or
recreational purposes. The net earnings of a Section 501(c)(4)
organization may not benefit any private shareholder or individual.
4 Arguably, Stockman has also preserved a complaint about the district court’s
disjunctive Count 12 jury instructions. Stockman appears to argue that the district court
erred by allowing the jury to convict Stockman for inducing Uihlein’s 2014 expenditure on
advertisements “advocating Mr. Stockman’s election or attacking Mr. Stockman’s opponent”
because the indictment alleged a conjunction. But the government does not heighten its
burden of proof by pleading criminal acts conjunctively. See United States v. Holley, 831 F.3d
322, 328 n.14 (5th Cir. 2016). Here, the government was not required to prove that Uihlein’s
money was spent on advertising “advocating for Stockman’s election and attacking
Stockman’s opponent.” We thus decline to find error in the district court’s disjunctive
language.
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At oral argument, defense counsel represented that Stockman
principally objects that this language of the instructions was “irrelevant” and
“unnecessary.” Stockman concedes, however, that no contemporaneous
objection was made at trial; instead, he now argues that the district court
should have excluded the 501(c)(3) and 501(c)(4) definitions from the charge
sua sponte.
Given Stockman’s failure to object at trial, our review is for plain error.
United States v. Saldana, 427 F.3d 298, 303–04 (5th Cir. 2005). Stockman
must demonstrate “(1) that an error occurred; (2) that the error was plain,
which means clear or obvious; (3) [that] the plain error [would] affect [his]
substantial rights; and (4) [that] not correcting the error would seriously affect
the fairness, integrity, or public reputation of judicial proceedings.” Id. at 304
(quotation omitted).
We are not convinced that the district court erred by defining 501(c)(3)
and 501(c)(4) organizations in the charge, but, in any event, no such error was
sufficiently “clear or obvious” to survive plain error review. Many of the
witnesses discussed 501(c)(3) and 501(c)(4) organizations in their testimony,
and some of that testimony even went directly to the elements of mail and wire
fraud. Stockman has not cited a truly analogous case, and we are not aware of
one. We have said that an “error cannot be plain where there is no controlling
authority on point and where the most closely analogous precedent leads to
conflicting results.” United States v. Gomez, 706 F. App’x 172, 177 (5th Cir.
2017) (quoting United States v. De La Fuente, 353 F.3d 766, 769 (9th Cir.
2003)). Similarly, when any analogy to existing authority would be strained,
the district court’s actions cannot amount to plain error.
Apart from his objection that the 501(c)(3) and 501(c)(4) definitions were
“unnecessary,” Stockman also argues that the definitions, though
undisputedly drawn from the text of the Internal Revenue Code, misled the
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jury by framing the obligations of 501(c)(3) and 501(c)(4) organizations in
absolute terms. See, e.g., St. David’s Health Care Sys. v. United States, 349
F.3d 232, 235 (5th Cir. 2003) (suggesting that tax-exempt organizations must
be operated primarily, rather than exclusively, for an exempt purpose). But,
again, we cannot agree that the district court’s statutory instructions merit
reversal under the plain error standard. An instruction that mirrors relevant
statutory text “will almost always convey the statute’s requirements,” United
States v. Lebowitz, 676 F.3d 1000, 1014 (11th Cir. 2012), and Stockman has not
identified any authority rendering it “clear or obvious” that a district court’s
jury instructions must go beyond the language of the statute in this context.
B.
Stockman next seeks to reverse his conviction for causing an excessive
campaign contribution in the form of a coordinated expenditure, an offense
covered by Count 12 of the indictment. Count 12 alleges that Stockman, acting
through various agents, induced Uihlein to spend over $450,000 on The
Conservative News, a political communication promoting the Stockman
campaign. The government argues that, because Stockman was involved in
requesting and spending the money for this project, Uihlein’s $450,000
payment was a “coordinated expenditure” under the Federal Election
Campaign Act, 52 U.S.C. § 30101 et seq. (FECA). 5
5 FECA treats “coordinated” expenditures like “campaign contributions,” placing an
upper limit on the amount of money that donors may spend on them. The government’s
position is that Stockman, having willfully caused Uihlein to spend more than $25,000 on a
coordinated communication, is subject to the especially severe criminal penalties applicable
to those who make campaign contributions in excess of $25,000. See 52 U.S.C. §§
30116(a)(1)(A) (establishing upper limit on campaign contributions), 30109(d)(1)(A)(i)
(authorizing extra punishment for campaign contributions in excess of $25,000),
30116(a)(7)(B)(i) (equating coordinated expenditures with campaign contributions); 18 U.S.C.
§ 2(b) (authorizing punishment “as a principal” for those who “willfully cause[] an act to be
done which if directly performed by [them] or [others] would be an offense”).
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Stockman does not deny that, if the Uihlein donation were an
“expenditure,” it would be a “coordinated” expenditure of over $450,000, the
equivalent of a campaign contribution well beyond statutory limits. Indeed, he
could not argue otherwise: the evidence shows that Stockman at the very least
“cooperat[ed]” with Uihlein and Wagner’s distribution of The Conservative
News. See 52 U.S.C. § 30116(a)(7)(B)(i) (coordinated expenditures are those
made in “cooperation, consultation, or concert with” a candidate or his
campaign committee). For example, Wagner testified that mailing The
Conservative News was Stockman’s idea, that Stockman supervised him once
distribution was underway, and that Stockman dictated some of the letter that
secured funding from Uihlein.
Instead, Stockman’s appellate challenges to the conviction turn on the
word “expenditure.” Stockman argues that, in Buckley v. Valeo, 424 U.S. 1
(1976), the “Supreme Court cabined FECA’s definition of ‘expenditure’ to
encompass only ‘funds used for communications that expressly advocate for the
election or defeat of a clearly identified candidate.’” Such “express advocacy”
entails the use of “words [like] ‘vote for,’ ‘elect,’ ‘support,’ ‘cast your ballot for,’
‘Smith for Congress,’ ‘vote against,’ ‘defeat,’ [and] ‘reject.’” Buckley, 424 U.S.
at 44 & n.52. Stockman maintains that to effect a regulated “expenditure,”
donors must spend their money on communications containing these “magic
words.” It is clear and uncontested that The Conservative News does not
contain direct instructions to “vote for” or “defeat” any candidate. It would
follow, Stockman argues, that Uihlein did not effect an “expenditure” when he
funded The Conservative News.
But the Supreme Court rejected this reading of FECA in McConnell v.
FEC, 540 U.S. 93 (2003), overruled on other grounds by Citizens United v. FEC,
558 U.S. 310 (2010)). In McConnell, the Supreme Court considered precisely
the statutory language at issue here, namely the rule (now codified at 52 U.S.C.
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§ 30116(a)(7)(B)(i)) that “expenditures . . . in cooperation, consultation, or
concert with” a candidate are to be considered the equivalent of campaign
contributions and restricted accordingly. See McConnell, 540 U.S. at 202. The
McConnell Court explained that a post-Buckley statutory enactment had
“clarifie[d] the scope” of this language, “pre-empt[ing]” a possible claim that
“coordinated expenditures for communications that avoid express advocacy
cannot be counted as contributions.” 540 U.S. at 202. In other words, the Court
held that the presence of express advocacy is not a prerequisite of the “settled”
rule that when expenditures are “controlled by or coordinated with the
candidate and his campaign[,] [they] may be treated as indirect contributions
subject to FECA’s . . . amount limitations.” Id. at 219 (cleaned up).
Stockman seeks to distinguish McConnell on the ground that “McConnell
held . . . the express advocacy requirement for expenditures . . . preempted only
with respect to . . . narrowly defined ‘electioneering communication[s].’” 6 Not
so. The relevant portion of McConnell deals separately with two distinct
subsections of FECA, one pertaining to electioneering communications and the
other to expenditures “more generally.” 540 U.S. at 202. The latter subsection,
not the former, was the focus of the Court’s “preemption” comment. Id. We
reject Stockman’s construction of the statute. 7
6 An “electioneering communication” is “any broadcast, cable, or satellite
communication that refers to a clearly identified candidate for federal office and is made
within 30 days of a primary or 60 days of a general election.” Citizens United, 558 U.S. at
321 (cleaned up). The McConnell decision is largely, but not exclusively, concerned with
Congress’s regulation of these communications. See 540 U.S. at 189–02.
7 Stockman also attempts to escape McConnell by invoking Center for Individual
Freedom v. Carmouche, 449 F.3d 655 (5th Cir. 2006), and Chamber of Commerce of the United
States v. Moore, 288 F.3d 187 (5th Cir. 2002). But neither case analyzed whether Buckley’s
limiting construction should apply to coordinated expenditures. Carmouche interpreted a
Louisiana statue that “link[ed] disclosure requirements for expenditures made by
independent individuals” to language that the Supreme Court narrowed in Buckley.
Carmouche, 449 F.3d at 664 (emphasis added). Moore found that the relevance of express
advocacy was clear because the Mississippi statute under scrutiny had “essentially adopted
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C.
We next consider Stockman’s argument that his tax and campaign
finance convictions under Counts 10, 11, 12, and 28 of the indictment were
tainted by the district court’s refusal to instruct on “good faith.” Stockman
points to evidence that he relied on an accountant who “wrongly advised him
that having aides contribute money to his congressional campaign in the name
of their parents was permissible.” He also points to evidence that Stockman
and Posey intentionally omitted words of express advocacy from The
Conservative News in order to comply with FECA. He asserts that “[i]n this
context and where willfulness is required, a good faith instruction should have
been given.”
Again, we disagree. Although the parties dispute the standard of review
applicable to the district court’s refusal to instruct on good faith, decisions of
this court and the Supreme Court show that the refusal was not erroneous,
whether reviewed de novo or for plain error. See United States v. Pomponio,
429 U.S. 10, 11–12 (1976); United States v. Simkanin, 420 F.3d 397, 409–11
(5th Cir. 2005). Stockman argues that a good faith instruction should have
been issued because the tax and campaign finance offenses in question all
require a showing of “willfulness.”
But it is precisely that requirement that renders any such instruction
unnecessary. The Supreme Court held in Pomponio that an additional good
faith instruction is not required when the charge already requires proof of
“willfulness,” properly cabined to cover only “voluntary, intentional violation[s]
of . . . known legal dut[ies].” 429 U.S. at 12 (quotation omitted). In so holding,
the Court gave its approval to a charge that did not instruct on good faith but
the language” of the Buckley limiting construction. Moore, 288 F.3d at 196. These cases are
distinguishable and neither one casts doubt on the conclusions we draw from McConnell.
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did instruct on the need for proof of a “willful” act, meaning an act “done
voluntarily and intentionally and with the specific intent to do something
which the law forbids, that is to say with [the] bad purpose either to disobey or
disregard the law.” Id. at 11–12 (quotation omitted). Drawing from Pomponio,
we held in Simkanin that a “specific instruction” on good faith is not required
when the concept is sufficiently subsumed by a general instruction on
“willfulness.” 420 F.3d at 409–11. Simkanin, like Pomponio, approved of
instructions alerting the jury to the fact that a “willful” act is done “voluntarily
and deliberately,” with the intention of “violat[ing] a known legal duty.” Id.
at 409–10.
Here, the district court’s instructions mirrored those in Pomponio and
Simkanin. With respect to Counts 10, 11, and 12, the district court instructed
the jury that to act “willfully,” the defendant must act “voluntarily and
purposely, with the specific intent to do something the law forbids, that is, with
the bad purpose either to disobey or disregard the law.” With respect to Count
28, the district court instructed the jury that it could not convict unless it found
that Stockman acted “with intent to violate a known legal duty.” We find no
merit in Stockman’s “good faith” argument.
D.
Finally, we address Stockman’s challenge to the evidence supporting his
convictions for mail fraud, wire fraud, and money laundering. 8 Stockman
argues that the district court erred when it denied his motions for judgment of
acquittal under Rule 29, contending that the government failed to prove a
fraudulent “scheme” that Stockman devised with the necessary intent to
8 As to the money laundering convictions, Stockman argues only that the government
cannot meet its burden to prove a predicate offense if the fraud convictions lack evidentiary
support. See 18 U.S.C. §§ 1956–57. Because we reject Stockman’s challenge to the fraud
convictions, we necessarily reject his challenge to the money laundering convictions as well.
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defraud. See 18 U.S.C. §§ 1341, 1343. We review the denial of a Rule 29 motion
de novo, asking whether “any rational trier of fact could have found the
essential elements of the crime[s] beyond a reasonable doubt.” United States
v. Xu, 599 F.3d 452, 453 (5th Cir. 2010) (quotations omitted).
The elements of mail fraud are “(1) a scheme to defraud; (2) use of the
mails to execute the scheme; and (3) the specific intent to defraud.” United
States v. Simpson, 741 F.3d 539, 547–48 (5th Cir. 2014) (quotation omitted).
The elements of wire fraud are “(1) a scheme to defraud; (2) the use of, or
causing the use of, wire communications in furtherance of the scheme; and (3)
a specific intent to defraud.” United States v. Harris, 821 F.3d 589, 598 (5th
Cir. 2016). In evaluating its sufficiency, we view the evidence in the light most
favorable to the government. United States v. Rodgers, 624 F.2d 1303, 1306
(5th Cir. 1980). Stockman challenges the evidence supporting his convictions
with respect to both the “scheme” and “intent” elements of mail and wire fraud.
1.
Challenging the denial of his Rule 29 motions, Stockman argues that the
government’s evidence does not establish a fraudulent “scheme.” His
reasoning is somewhat tortuous. Stockman argues that, although purporting
to allege a single scheme, the indictment actually alleges “no fewer than four
separate ‘schemes.’” He further asserts that at least one of these four separate
schemes, the 2014 Uihlein “scheme,” is not supported by sufficient evidence
because the government failed to prove that in the 2014 scheme Uihlein was
deprived of money or property. Then, expressly reverting to a single-scheme
argument, he contends that, because the jury returned a general verdict
without specifying which “scheme within a scheme” it was relying on to satisfy
the “scheme” element of mail and wire fraud, all seven mail and wire fraud
convictions must be set aside for failure to prove a scheme. See Yates v. United
States, 354 U.S. 298, 311 (1957) (“[A] verdict [must] be set aside in cases where
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the verdict is supportable on one ground, but not on another, and it is
impossible to tell which ground the jury selected.”), overruled on other grounds
by Burks v. United States, 437 U.S. 1 (1978).
Stockman’s arguments are confected on a foundation of sand. The
evidence shows that there was only one scheme, a scheme to separate wealthy
donors from their money and to spend that money at Stockman’s pleasure and
direction. Furthermore, there is no merit in Stockman’s argument that the
2014 Uihlein solicitations did not threaten to deprive Uihlein of money or
property. Each donation from each donor, Uihlein included, was given under
the false pretense that the donor’s money would be used for specific purposes,
including “voter education” and independent political advocacy. The money
was not used for those purposes. Instead, it was, at all times, under
Stockman’s control. He used it to finance his political career and sustain his
self-indulgent lifestyle. It is thus clear that all of Stockman’s solicitations were
designed to effectuate a traditional “money or property” fraud.
In short, we hold that there was no failure of proof regarding the
“scheme” element of mail and wire fraud. On the contrary, viewing the
evidence in the light most favorable to the conviction, we find ample support
for the government’s position that Stockman orchestrated a single scheme to
appeal to the charity of politically-interested donors for fraudulent purposes.
2.
Stockman further challenges the denial of his Rule 29 motions on the
ground that the government produced insufficient evidence of Stockman’s
fraudulent intent. In this context, he argues that the government’s evidence
does not suggest a “contemporaneous” intent to defraud because evidence of
Stockman’s illicit spending cannot establish bad faith simultaneous with the
solicitation and receipt of donor funds. From this premise, Stockman concludes
that the government’s case is based on nothing more than “evidentiary time
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travel.” Stockman’s time-and-space argument is weakened by the absence of
evidence supporting it, but even more by the very strong evidence from which
the jury could reasonably infer that Stockman had the intent to defraud from
the time the money was donated until it was fully spent.
Stockman does not deny that, shortly after receiving donations from
Rothschild and Uihlein, he misappropriated the funds by disregarding the
purposes for which they were donated. Indeed, Stockman does little to dispute
the overwhelming evidence that, shortly after receiving it, he quickly diverted
donor money to personal and political projects having nothing to do with
philanthropy or education. Notwithstanding Stockman’s self-serving view that
later misappropriations cannot evidence earlier bad faith, the jury could
rationally have inferred Stockman’s fraudulent intent from this largely
undisputed evidence. We thus find that the government has also met its
burden with respect to the “intent” element of mail and wire fraud.
IV.
In this appeal, we have held that the district court’s instructions were
not erroneous. It was not plain error for the district court to define 501(c)(3)
and 501(c)(4) organizations in the charge, and Stockman was not entitled to an
instruction on good faith. We have also held that the district court did not err
by denying Stockman’s motions for judgment of acquittal under Rule 29. The
government provided ample evidence that Stockman fraudulently devised, and
implemented, a scheme to deprive two donors of their money and property,
thus allowing the jury to rationally find Stockman guilty of mail fraud, wire
fraud, and money laundering. And, we have further held that FECA’s
contribution limits apply to coordinated spending on political communications,
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irrespective of whether those communications contain magic words of express
advocacy. We thus have affirmed Stockman’s campaign finance conviction.
In sum, the judgment of the district court is, in all respects,
AFFIRMED.
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