United States v. Morosco
2016 U.S. App. LEXIS 8753
| 1st Cir. | 2016Background
- Chelsea Housing Authority (CHA) managed ~350 federally funded units inspected by HUD/REAC; high REAC scores brought less oversight and more funds.
- McLaughlin (CHA executive director) secretly received inflated salary and wrote himself large checks; his conduct triggered a broader investigation.
- Vitus Shum (finance director) cooperated with investigators, admitted to helping McLaughlin, and revealed a scheme where REAC inspection samples were obtained in advance.
- Bernard Morosco (REAC-trained consultant/inspector) used access to REAC systems to generate the random-sample lists and provided them to Fitzpatrick and others; CHA formed "SWAT teams" to fix those units before inspections.
- McLaughlin pleaded guilty; Fitzpatrick (director of modernization) and Morosco were tried, convicted under 18 U.S.C. § 371 (conspiracy to defraud the United States), and sentenced; both appealed raising multiple claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Void-for-vagueness of § 371 defraud clause | Morosco/Fitzpatrick: clause is vague as applied; should be limited to schemes to obtain government money/property | Government: longstanding Supreme Court and First Circuit precedent defines § 371 broadly to include deceit that impairs agency functions | Rejected — precedent (Hammerschmidt, Haas, Dennis, etc.) forecloses vagueness challenge; § 371 covers schemes to impair agency functions, not only property/money deprivation |
| Sufficiency of evidence (Morosco) | Morosco: record did not show targeting of a governmental function or requisite agreement/intent | Government: proof that Morosco accessed REAC, produced sample lists, transmitted them, and CHA used SWAT teams to prepare only those units; corroborating emails and cooperating witnesses | Affirmed — viewed in government’s favor, evidence supported that Morosco knowingly joined conspiracy to impair REAC inspections |
| Jury-pool contamination (judge told venire McLaughlin had pleaded guilty) | Defendants: judge’s disclosure about McLaughlin’s plea prejudiced jury and tainted impartiality | Government: judge erred but the remark was minimally prejudicial and curative steps/instructions mitigated harm; no use of plea at trial | Affirmed — error acknowledged but harmless beyond a reasonable doubt given timing, jury questioning, instructions, lack of later use, and strength of evidence |
| Mens rea / jury instruction on willfulness (Morosco) | Morosco: jury should have been instructed that conviction requires that he knew his conduct was criminal | Government: statute requires knowledge of the facts making conduct wrongful, not knowledge that conduct violated criminal law; existing instruction adequate | Affirmed — no plain error; instruction required willfulness/intent to impair HUD function and defendants did not request an instruction requiring knowledge that the conduct was criminal |
| Sentencing: minor-role reduction for Fitzpatrick (USSG § 3B1.2) | Fitzpatrick: judge should have granted minor-role adjustment or remanded in light of post-sentencing amendment clarifying that "integral/indispensable" status alone should not preclude the reduction | Government: judge considered relative culpability and the amendment (even if clarifying) does not require remand | Affirmed — judge evaluated relative culpability and discretionary sentencing; amendment would not change outcome given the court’s findings and downward variance already imposed |
Key Cases Cited
- Dennis v. United States, 384 U.S. 855 (1966) (§ 371 not confined to common-law fraud definition)
- Hammerschmidt v. United States, 265 U.S. 182 (1924) (defrauding government includes deceit that impairs agency functions)
- Haas v. Henkel, 216 U.S. 462 (1910) (§ broadly reaches conspiracies impairing government departments)
- United States v. Barker Steel Co., 985 F.2d 1123 (1st Cir. 1993) (first-circuit precedent applying Supreme Court § 371 principles)
- United States v. Ofray-Campos, 534 F.3d 1 (1st Cir. 2008) (prejudice presumption and harmless-error framework for juror exposure to extrinsic information)
- United States v. Monteiro, 871 F.2d 204 (1st Cir. 1989) (approving willfulness-style instruction in § 371 conspiracy context)