and proof of a material false or fraudulent pretense now the government response that would the decision of this circuit is proof that that is not a requirement that one can be charged and convicted of wire fraud and mail fraud without evidence of a specific false statement that's absolutely true but it misses the point you can't commit fraud without a specific false statement but you can't do without a false pretense you can create circumstances that mislead even though you haven't specifically  but you have to affirmatively create a false pretense would does not overrule need or it couldn't and united states supreme court in need are plainly required materiality of a false pretense or statement and the fact was alleged this indictment does not set forth a federal crime it may or may not suggest a state crime but it plainly does not allege a federal crime now defendant subjected to this vigorously  there is no question that this failure of the indictment was prejudicial and what it did was precisely because the indictment didn't articulate a federal crime the defendants spent the next two years plus trying to figure out exactly what it was they were charged with and what be developed was that the prosecution rather than looking at the indictment as a road map looked at it as a rorschach test every time the government was questioned about what was in the indictment the government found something new and different so first is the court recalls and i'm sure the court does the indictment alleges that that information was obtained confidential information was obtain committed between one thousand nine hundred four and two thousand the first the court and the government appeared to be perfectly content despite the objections of the defendants to proceed on the theory that this was essentially a theft and the court in colloquy and i can point to pages one thirty four one fifty eight one sixty and one sixty three of our exit or the court and the government repeatedly articulated  after the defendants had raised the issue of what false returns are we trudged with the governments finally apparently realized that a false pretense was required so the government now took the position that yes it had in fact alleged a false pretense and even at this point in this is it page two seventy of arts or even at this point the government is arguing to the court that it's indictment means that even if the defendant's got the drawings false pretense is some misleading material misrepresentation or omission has to occur or else there is no federal crime it's otherwise it's theft if you just take something  not give notice of what the defendants are charged with the defendants do everything they can and they move to dismiss them as a book because what is it were charged with and they are told every time they ask something different and there which the jury is given one is the false representations to apply employees not only indictment it's an expansion of what's there it is a a go on and what  is not supported in of which there is no notice but in addition and this i think is the one and avoidable problem in the case in addition some time towards the end of the trial a new theory of arises which is a theory of false concealment it doesn't appear in the government's trial brief it doesn't appear in the government's pretrial submitted instructions it doesn't appear in the government's revised truong structure and it's not argued represented in the evidence but when we get to the final jury instructions we now are presented with a theory of false concealment that under downlink requires one of two things either the statutory duty or an existing five years sheri responsibility no there was no statutory duty of the trade secrets act didn't exist at the time there is no other statutory obligation here obligation to disclose can result from circumstances where trust and confidence have been reasonably reposed by another to the instruction because i thought it was not factually supported they did not that there was an objection clearly made that the evidence at the trial did not support this objection and that is a correct statement there is a problem of after their relationship began applied unilaterally gave them a confidentiality agreement that was retrospective thirteen years and i asked them to sign it they said no there was never an acceptance by the mcdowell parties  impose an obligation on another without the parties acceptance but and this is particularly significant in a case in which the defendants entire problem entire complaint was we don't know what we're charged with we don't know what we're defending the instruction that the court gave was directly contrary to what the court told the parties it understood the law to be and it's june fourth two thousand one hearing at page one sixty three and i know that it's not always advisable to read to a court but i do think it's important to point out that of page one hundred four two thousand one at the hearing on the motion to dismiss the bill of particulars what the court tells the parties i really knew that the documents were only to be used for x purposes but that was never communicated to the defendants even though that restriction existed the defendants couldn't be responsible for doing anything wrong if they didn't know that they were stricken existed they have to know that's what the court told the parties that it understood the law to be that's the way the case proceeded that's the way the trial went forward only at the  trial that the court decided to give an instruction which was the exact opposite which told the jury that it could convict even if the defendants didn't know or agree as long as applied reasonably reposed trust morning may please the court i'm barbara value on behalf the united states i think the most important thing to point out the court is that the defendants never objected below to the in language in the indictment they never objected at  least that the indictment did not allege a specific misrepresentation and there were objections and there were girls in particular in which the parties discussed what it was the government's theory were prior to trial and at the conclusion of the bill of particulars the june fourth hearing that counsel referred to the court specifically outlined that the government's theory would be that either misrepresentation or false pretenses were made to applied materials by  mcdowell's when the in taking the documents and that was either by false pretenses by the firm of statement or by some type of concealment and therefore that was put government's theory from there on out it is true that the government indicted this case on your broad  of materials confidential business information in the form of semiconductor parts drawings that is the key sentence i think in the indictment which is that there was a broad indictment that the broad language that there was a scheme to  divert the confidential business information of applied materials to their own use and subsumed within the language of an authorized version the court concluded that the june fourth hearing was this notion that false pretenses had been conceal the fact that they would in fact be using them they conceal that they would be used for another purpose thereafter erased from the drawings the logo in the name and the proprietary all the criteria information that applied to applied material they replaced it with their own name mcdowell and company and the name and also a confidentiality stamp they sent it out to vendors they then received quotes and had parts made that were specialized parts that were the proprietary that were based on proprietary information of five materials they then sold those parts to the customers applied materials all without the knowledge of the applied materials that was the theory that was alleged in the indictment and that is the fact and were listed in the indictment were and the drawings that were used during that were converted to mcdowell's use were drawings that related to what they call specialized parts parts that had to do with parts that were engineers specifically  for materials machines there were there was trade secrets or there was confidential business information that went into the making of those parts and that's what made them so valuable mcdowell was not supplying those types of parts to applied materials but supply those types of machine parts instead of doing that and i think the record clearly shows that trial macdowell never down company never actually did back to applied materials and spent they kept the drawings and then there after converting them involved in making these parts that they could not use these drawings in this manner despite that they not only denied they were to applied materials during the course of this conduct that they were using the drawings in that manner and then continued to use in that manner but they also representations to the privateers employees and that there is evidence that they made the representation to martin when at least there is evidence from which the jury can conclude that that was so and the evidence is that first of all mr mcdowell had a meeting with the applied materials attorney in one thousand nine hundred eight in which he sort of fessed up to the activity because they were fearful of losing their contract with a five materials at that time he represented in a letter and also orally that he had received the materials from martin lien and for the purposes of building there was no it was clear from his letter that that was the purpose that he had explained at least to martin lee already applied materials employees from whom he had received them the  court trial had determined that that government could proceed under that theory either a permanent misrepresentations i e i'm going to use these documents for this purpose or the theory that you concealing his true means seventy three drawings from applied materials and we profited approximately nine hundred forty thousand dollars by selling parts based on these drawings to other customers especially what they did was they they misappropriated the information the drawings they used the drawings as if they were their own and then they cut applied materials sort of out of the loop and that's how they profited they made that nine hundred forty thousand dollars based on their sale of those particular parts that was the evidence that there was address just briefly the second point that was made about the concealment instruction and just to clarify the record primarily but again i think the court had pointed out that they never objected on the grounds or claiming on appeal that the giving of the concealment instruction constructively amended the indictment because it added a new theory it's our view then and the court i think understood this during the june fourth hearing that you didn't add any kind of new theory that it was that the theory always was same language that the court used when it instructed on the concealment instruction their only objection was there's no evidence of you terry duty between or other contractual duty which is how actually they phrased it which went to the two parties as i mentioned earlier in my argument there was evidence that they had signed a purchase and sale agreement with applied on three different occasions one nine hundred eighty three nine hundred eighty eight and one nine hundred ninety two in which the charms whether or not specific terms of the contract work that they would treat applied materials proprietary information as prompted entia one of the note is of course these applied materials drawings were stamped and actual each one of them were stamped confidential with this admonition that they should not be used without the written permission of applied materials so there's no doubt that they were on notice the entire time that this was a misuse of the drawings and one more thing with regard to whether or not there was sufficient evidence to give that he was in a different in a different place than other companies with applied materials because he had this ongoing relationship i think you're hard pressed not to say that with sufficient evidence for the jury to conclude that there was some type of you sure duty on the part of mcdo to create that obligation however if there is such an obligation i think that it was met here primarily by the fact that applied materials did not menu factor in these particular parts by themselves they were they depended upon the distributors in the vendors to manufacture these these parts as one of the applied materials defendants testified these particular parts for the heart and soul of applied materials so in that respect at least with regard to these drawings and these parts it's clear standard if there is not a constitutional error here there is no it's government's position that based on the record there is no constitutional error but there is of course the statutory error that the court did not understand that the guidelines were advisory booker which is the court talked about balancing the need for the king at the specific characteristics of the defendant versus balancing the specific need of punishment for this offense under the thirty five fifty three factors that have now been outlined but by the book a court that's essentially all the defendant could expect this is relevant because on a plane or a standard the defendant can't show essentially that his sentence in this case affected the fairness and integrity of the proceedings for that leadership designation because the evidence then supported and objected to more than minimal planning those three findings by the court without the jury amounted to ten levels without those findings we start at a level twelve clearly under booker fanfan this has to go back for the court to redo the sentence if we get there but if i make two points with respect to the substance number one the court's questions pinpoint exactly what the problem is here and that is employee or of applied material during the period of the indictment during the period of the statue of limitations there was no evidence that anything was a painting by false pretenses later some people said that they believed the macdo