United States v. Jinian
2013 U.S. App. LEXIS 15079
| 9th Cir. | 2013Background
- Jinian, Bricsnet's CEO, used a scheme to defraud Bricsnet of over $1.5 million by issuing nearly 100 small checks (Nov 2006–Sep 2008).
- Checks deposited into Mechanics Bank in California were cleared via a Federal Reserve Bank intermediary and wires between banks to SVB in California.
- Interbank wire communications and the checks-clearing process connected to the fraud were proven at trial through testimony about the Fed Reserve’s processing steps.
- Jinian was convicted on 13 of 14 wire-fraud counts; district court denied motions for acquittal, new trial, and arrest of judgment.
- The panel amended the opinion and denied rehearing en banc/panel rehearing; the full court affirmed Jinian’s conviction and sentence.
- The core legal question is whether interstate wire communications used during the scheme satisfy the federal wire-fraud statute’s “execution of the scheme” requirement under Kann/Schmuck.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Kann or Schmuck controls the execution of the scheme analysis | Jinian: Kann controls; acts were after funds obtained | Jinian: Schmuck applies since execution tied to ongoing scheme | Schmuck analogue governs; conviction sustained |
| Whether the interstate wire component must be reasonably foreseeable | Foreseeability required for interstate wires | Interstate nexus is jurisdictional, not a substantive element | Interstate nexus is jurisdictional; foreseeability not required |
| Sufficiency of evidence and jury instructions on interstate wires | Evidence showed wires used to execute/conceal scheme | District court correctly instructed; no error on requirement | District court instructions correct; no abuse of discretion |
| Constitutionality of wire fraud statute under Necessary and Proper/Tenth Amendment | Statute exceeds congressional power | Statute valid under Commerce Clause | Statute valid; no constitutional defects |
Key Cases Cited
- Schmuck v. United States, 489 U.S. 705 (1989) (essential step in passage of title; ongoing scheme)
- Kann v. United States, 323 U.S. 88 (1944) (mailings not part of Kann; separate/final execution)
- Shipsey, 363 F.3d 962 (9th Cir. 2004) (distinguished Kann for wire-fraud context)
- Lack, 129 F.3d 403 (7th Cir. 1997) (distinguishes Kann where fraud ongoing)
- Franks, 309 F.3d 977 (7th Cir. 2002) (pre-UCC context; Kann distinguishable)
- Mills, 199 F.3d 184 (5th Cir. 1999) (ongoing venture; can fit Schmuck analysis)
- Gonzales v. Raich, 545 U.S. 1 (2005) (Commerce Clause scope)
- Lo v. United States, 231 F.3d 471 (9th Cir. 2000) (wire as step in execution of scheme)
- Pelisamen, 641 F.3d 399 (9th Cir. 2011) (elements of wire fraud; specific intent)
- Bohonus, 628 F.2d 1167 (9th Cir. 1980) (specific intent element)