United States v. Eriksen, 639 F.3d 1138

Lunde Electric established the 401(k) Profit Sharing Plan in 1979, with Sigmund Eriksen as Chair and Raymond Eriksen as President/CEO and Plan trustees.
The 1995 Amendment added a 401(k) feature and the 2002 Restatement enacted a formal 401(k) plan; documents showed signatures by the Eriksen defendants as employer/trustees.
From 1999–2002, elective deferrals were withheld from employees but not deposited into the Plan Account, increasing receivables on Lunde Electric’s books.
Brad Sommerfeld[’s] testimony and company records indicated ongoing failure to remit employee deferrals while preparing Plan-related documents.
In 2003 the Department of Labor investigated; after a subpoena, Lunde Electric resumed remitting deferrals, reducing the Plan’s unfunded liability.
In 2008, Sigmund and Raymond Eriksen were indicted and convicted on counts for embezzlement/conversion and false statements in ERISA documents; sentence included probation, fines, and community service.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Sufficiency of evidence for § 664 embezzlement	Eriksen asserts plan assets were not established; thus no embezzlement occurred.	Eriksen contends no plan asset amount was misused as funds remained discretionary employer contributions.	Sufficient evidence supported embezzlement/conversion findings; funds were misused and diverted from the Plan.
Whether the Plan Asset Regulation Bootstrap is improper	Regulation defines plan assets and aided proving misappropriation.	Regulation misled jurors; cannot create criminal liability for § 664 by bootstrapping civil regulation.	Plan Asset Regulation did not bootstrap the crime; evidence showed willful misappropriation independent of the regulation.
Sufficiency of evidence for § 1027 false statements	Valuation Reports falsely indicated contributions were deposited when they were not.	Statements were not required to be accurate under ERISA or were not material.	There was sufficient evidence that the Valuation Reports were required and that the statements were material and false.

United States v. Andreen, 628 F.2d 1236 (9th Cir. 1980) (emphasizes intent and fiduciary wrongdoing in § 664 cases)
United States v. Wiseman, 274 F.3d 1235 (9th Cir. 2001) (rejects borrowing defense and affirms intent considerations)
United States v. Mett, 178 F.3d 1058 (9th Cir. 1999) (rejects implied authorization/borrowing defenses in ERISA contexts)
United States v. Sarault, 840 F.2d 1479 (9th Cir. 1988) (ripe for interpreting 1027 record-keeping; broad ERISA documentation scope)
United States v. Nolan, 136 F.3d 265 (2d Cir. 1998) (materiality not required for § 1027; focus on knowingly false statements)
United States v. Christo, 614 F.2d 486 (5th Cir. 1980) (bootstrapping civil violations into criminal charges is improper)
United States v. Wolf, 820 F.2d 1499 (9th Cir. 1987) (cautions against using civil regulations to supply criminal elements)
Winterrowd v. American General Annuity Ins. Co., 321 F.3d 933 (9th Cir. 2003) (ERISA amendment procedures and authority to amend)
Curtiss-Wright Corp. v. Schoonejongen, 514 U.S. 73 (1985) (statutory amendment authority and procedural requirements)