United States v. Chen, 998 F.3d 1

Background

Chen was indicted on four counts: three insider-trading counts (15 U.S.C. §§ 78j(b), 78ff) and one count of making a materially false statement to the FBI (18 U.S.C. § 1001). He was acquitted of the insider-trading counts and convicted on the false-statement count; sentence: two years probation and $4,000 fine.
The government alleged Chen traded Vistaprint options profitably before earnings announcements (≈$830,000 profit) and received tips from Vistaprint executive Zhen (Jenny) Ye or her husband Kun (Kevin) Xu; families had a close social relationship.
During an FBI interview Chen made two relevant statements: (1) the Recall Allegation — he said he "could not recall" trading Vistaprint options (this was the charged false statement in the indictment); and (2) the Friends Allegation — he denied being close friends with Xu and claimed not to know Jenny's job (uncharged but emphasized by the prosecution).
On appeal Chen argued the jury may have convicted based on the uncharged Friends Allegation (variance, prosecutorial misconduct, and instructional/administrative errors) and separately challenged the sufficiency/materiality of the charged false statement in a Rule 33 motion.
The First Circuit held Chen failed to preserve most trial objections (many were waived or forfeited), applied the plain-error standard where appropriate, found the indictment unambiguous as to the Recall Allegation, concluded materiality could be established by a false claim of memory, and affirmed the conviction.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Variance / Sixth Amendment notice (jury may have convicted on uncharged Friends Allegation)	Chen: proof focused on Friends Allegation, creating a variance and depriving him of Sixth Amendment notice	Gov't: indictment plainly charged the Recall Allegation and Chen had notice; evidence of Friends Allegation was permissible and known	No prejudicial variance; no plain error — indictment and trial gave adequate notice; Chen had opportunity to request clarifying instructions but did not preserve objection
Prosecutorial misconduct in opening/closing; judge failed to give clarifying instruction	Chen: prosecutor emphasized uncharged Friends Allegation in opening/closing and judge should have instructed jury to focus on charged recall statement	Gov't: prosecutor ran out of time in opening, clarified to court he relied on Recall Allegation; arguments and evidence were proper; no clear misconduct	No clear or obvious prosecutorial misconduct; no sua sponte instruction required; plain error not shown
Administrative issues: indictment not given to jury; verdict form allegedly unclear	Chen: jury lacked the indictment and verdict form did not make clear count 4 required proof of Recall Allegation	Gov't: trial judge’s decisions were within discretion; defense affirmatively agreed to withhold indictment and approved verdict form	Waived — defense agreed at trial; no reversible error
Materiality / sufficiency of false-statement conviction (Rule 33/new-trial claim)	Chen: statement must have actually affected investigation; alleged failure of memory is not necessarily materially false	Gov't: materiality in §1001 requires a statement with a natural tendency to influence investigation; pretending not to recall can be sufficiently material	Held that materiality can be satisfied by a false denial of recollection intended to mislead; insufficiency challenge fails when evidence viewed in light most favorable to verdict

Key Cases Cited

United States v. Olano, 507 U.S. 725 (1993) (distinguishes waiver from forfeiture; defines waiver as intentional relinquishment of a known right)
United States v. Dominguez Benitez, 542 U.S. 74 (2004) (prejudice standard for certain Rule 11 errors; referenced for "reasonable probability" concept)
United States v. Phillipos, 849 F.3d 464 (1st Cir. 2017) (materiality under §1001 requires statement that has a natural tendency to influence an investigation)
United States v. Mehanna, 735 F.3d 32 (1st Cir. 2013) (statements intended to misdirect investigators can satisfy §1001 materiality)
United States v. Sampson, 898 F.3d 287 (2d Cir. 2018) (holding that a claimed failure of memory can be found intentionally deceptive and material)
United States v. Rodríguez-Milián, 820 F.3d 26 (1st Cir. 2016) (plain-error review applied where variance was not raised below)
United States v. Soto-Beníquez, 356 F.3d 1 (1st Cir. 2004) (variance reversal requires showing of prejudice to substantial rights)
United States v. Padilla, 415 F.3d 211 (1st Cir. 2005) (discusses reasonable probability that outcome would differ absent error)
United States v. Salley, 651 F.3d 159 (1st Cir. 2011) (sets forth four-part plain-error framework)
United States v. Landry, 631 F.3d 597 (1st Cir. 2011) (plain-error standard components)
United States v. Holmquist, 36 F.3d 154 (1st Cir. 1994) (preservation and review principles)
United States v. Kinsella, 622 F.3d 75 (1st Cir. 2010) (importance of alerting trial court to errors to preserve appellate review)
United States v. Tormos-Vega, 959 F.2d 1103 (1st Cir. 1992) (discusses harm from evidentiary spillover in multi-defendant or multi-conspiracy cases)
United States v. Medina, 761 F.2d 12 (1st Cir. 1985) (trial judge discretion whether to send indictment to jury)
United States v. Morel, 885 F.3d 17 (1st Cir. 2018) (standard for sufficiency review; draw inferences in favor of verdict)