United States v. Black
2010 U.S. App. LEXIS 22606
| 7th Cir. | 2010Background
- Defendants, Hollinger International executives, were convicted by a jury on three counts of mail and wire fraud and Black on obstruction of justice.
- The fraud theory submitted to the jury consisted of pecuniary fraud and honest-services fraud under 18 U.S.C. § 1346, with two counts tied to APC.
- Supreme Court later held honest-services fraud requires a bribe or kickback, raising doubt about convictions; remanded for reconsideration.
- On remand, the court analyzed whether the obstruction conviction could stand given the revocation of the honest-services theory.
- Evidence showed Black removed boxes of documents amid investigations, supporting obstruction despite later changes in honest-services law.
- The APC count involved a $5.5 million payment to prevent competition; no board or audit-committee approval or documentation supported this as legitimate management fees.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did error on honest-services instruction taint obstruction verdicts? | Black contends spillover from fraud instruction infected obstruction conviction. | Holzer/Schwartz-type logic argues misinstruction could warrant retrial on obstruction. | Obstruction conviction stands; no reversible spillover. |
| Was there sufficient evidence of pecuniary fraud for APC to sustain conviction? | Evidence showed mischaracterization of payments as fees to obtain private gain for Hollinger. | Argued recharacterization and lack of formal approval undermined pecuniary-fraud proof. | Pecuniary fraud conviction for APC count reversed; evidence insufficient as framed. |
| Should convictions tied to Forum-Paxton counts be sustained or reversed? | Forum-Paxton payments amounted to pecuniary fraud; covenants not to compete were not proven. | No covenants exist; payments could not be defense-aligned honest-services or legitimate fees. | Forum-Paxton and related counts affirmed; APC count reversed. |
| What is the appropriate remedy on remand for APC conviction? | New trial on APC count appropriate given reversal of APC conviction. | Retaining conviction via resentencing or dismissal of APC count may be more efficient. | Convictions on APC count reversed; remanded for retrial limited to APC, or government may proceed to resentencing. |
Key Cases Cited
- Hedgpeth v. Pulido, 129 S. Ct. 530 (S. Ct. 2008) (instructional error in multiple theories of guilt not automatic reversal)
- Neder v. United States, 527 U.S. 1 (S. Ct. 1999) (requires factual finding beyond reasonable doubt for every element)
- United States v. Buckley, 192 F.3d 708 (7th Cir. 1999) (materiality in obstruction cases can be implied when concealment hinders inquiry)
- United States v. Watts, 519 U.S. 148 (S. Ct. 1997) (sentencing court may consider underlying conduct proved by preponderance)
- Skilling v. United States, U.S. (S. Ct. 2010) (honest-services fraud requires bribe or kickback; impacts §1346 interpretation)