Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-09-03121/USCOURTS-caDC-09-03121-0/pdf.json

Parties Involved:
Courtney A. Stadd
Appellant
United States of America
Appellee

Document Text:

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Submitted December 3, 2010 Decided March 4, 2011

No. 09-3121

UNITED STATES OF AMERICA,

APPELLEE

v.

COURTNEY A. STADD,

APPELLANT

Appeal from the United States District Court

for the District of Columbia

(No. 1:09-cr-00065)

Dorrance D. Dickens was on brief for the appellant.

Ronald C. Machen, Jr., United States Attorney, and Roy W.

McLeese III, John P. Mannarino, David S. Johnson and

Matthew C. Solomon, Assistant United States Attorneys, were

on brief for the appellee.

Before: GINSBURG, HENDERSON and GRIFFITH, Circuit

Judges.

Opinion for the Court filed by Circuit Judge HENDERSON.

KAREN LECRAFT HENDERSON, Circuit Judge: Courtney

Stadd (Stadd) appeals from his conviction on one count of

committing an act affecting a personal financial interest in

violation of 18 U.S.C. §§ 208(a) and 216(a)(2) and two counts

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of making false statements in violation of 18 U.S.C.

§ 1001(a)(2). The convictions arose from his involvement in the

allocation of a $15 million congressional earmark while serving

as the interim Associate Administrator of the National

Aeronautics and Space Administration (NASA). Stadd

challenges the sufficiency of the evidence to support his

convictions and the jury instructions regarding the section

208(a) violation. We affirm his conviction on all three counts.

I.

In April 2005, incoming NASA Administrator Michael

Griffin (Griffin) asked Stadd to serve as NASA’s Deputy

Administrator, the agency’s second highest position. Griffin

sought Stadd for the position because Stadd had served as

NASA’s chief of staff during President George W. Bush’s first

term and thus was familiar with many NASA employees and

knew how the agency worked. Stadd declined the deputy

administrator position, citing impending personal expenses and

stating he felt he needed to leave government and return to the

private sector. He agreed, however, to serve on an interim basis

as associate administrator to help Griffin transition into his new

role as Administrator. Griffin described the associate

administrator position as equivalent to a chief operating officer. 

Stadd initially filled the associate administrator slot as a

government contractor but on April 28, 2005 he was converted 1

to a special government employee (SGE) and, as such, became

subject to the ethics laws governing federal officials/employees.

He received an ethics briefing from NASA’s general counsel’s

office, that included the following statement about 18 U.S.C.

§ 208(a):

Basic Rule: Employees must not act officially on

matters which may affect their personal interests. . . . 

All events occurred in 2005 unless otherwise noted.

1

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An employee is disqualified . . . from participating

personally and substantially . . . in any particular

matter . . . in which the employee, or anyone whose

interests are imputed to the employee, . . . has a

financial interest, if the particular matter will have a

direct and predictable effect on that interest. In other

words, an employee may not work on a particular

matter in which the employee’s outside employer has

an interest.

Exs. App. 139-41, United States v. Stadd, No. 09-3121 (D.C.

Cir. Apr. 29, 2010) (Exs. App.) (Senior New Entrant Ethics

Briefing PowerPoint) (emphasis added).

At the time, Stadd was sole proprietor of Capitol Solutions,

a consulting firm whose clients included the GeoResources

Research Institute (GRI) at Mississippi State University (MSU),

among others. He disclosed to NASA a list of his clients,

including GRI, and explained that GRI had held contracts with

NASA’s Earth Sciences office in the past but stated that during

his time acting as NASA’s interim associate administrator he

intended to focus on non-NASA matters for GRI. Through

periodic e-mails, Stadd kept Adam Greenstone (Greenstone), his

ethics advisor in NASA’s general counsel’s office, informed of

his efforts to comply with the ethics laws. For instance, in an email dated May 1, Stadd wrote, “I am strictly confining my role

to that of an advisor and facilitator vis-à-vis organizational

transition issues . . . and whenever possible avoiding meetings

or any situations that indirectly or directly affect my outside

business activities.” Gov’t App. Tab 8, United States v. Stadd,

No. 09-3121 (D.C. Cir. July 19, 2010) (Gov’t App.). In the

same e-mail, he reported that he had absented himself from a

NASA staff meeting when the discussion turned to a pending

meeting between one of his clients and the Administrator and

that he had requested to be excluded from any meetings

regarding a matter in which one of his clients had a “secondary

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interest.” Id. In a May 11 e-mail, Stadd reported he had met

with two of his clients and informed them he was recused “from

any and all NASA meetings or activities indirectly or directly

related” to them. Id. Tab 9.

On June 13, Stadd signed an ethics agreement “regarding

[his] federal service commencing April 28, 2005.” Gov’t App.

Tab 11 at 1. In the agreement, he disclosed his financial

interests, including his consulting services provided to GRI at

MSU, and pledged he would “not participate in any matters

involving any of these entities in the course of [his] NASA

official duties.” Id. at 2. He acknowledged that he “[would]

still be considered to have a financial interest in [the disclosed]

entities, and [would] therefore recuse [himself] from actions

involving them.” Id. He further pledged that during his tenure

with NASA, he would “not engage in any activities in which

[he] represent[ed] another person or organization, or [his] own

private interests, or may appear to be doing these things to

NASA.” Id. More generally, the ethics agreement provided that

Stadd was to “provide advice, guidance and recommendations

to senior NASA management on a range of issues related to

organizational transition, and [sic] well as on various transition

activities involving the strategic direction of NASA programs

and activities” but “not [to] perform any management or

supervisory work, make final decisions on substantive policies,

or otherwise function in the agency chain of command.” Id. at

1.

 A. The $15 Million Earmark

Before his confirmation as NASA Administrator, Griffin

met with members of the Congress, many of whom were angry

about the previous NASA Administrator’s policy of failing to

honor congressional earmarks. They let Griffin “know in no

uncertain terms that [he] would be expected to take care of

[honoring earmarks] on [his] first day.” Trial Tr. 136, United

States v. Stadd, No. 09-3121 (D.D.C. Aug. 4, 2009) (Trial Tr.). 

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Griffin testified that, in his four years as Administrator, he

remembered only two earmarks specifically—one of them the

earmark involved in this case. He remembered it “because it

was . . . with Senator Thad Cochran,” who was a senator from

Mississippi and “the head of [S]enate appropriations,” making

him, from Griffin’s perspective, “the most powerful senator in

the Congress.” Id. at 139. Cochran’s staff informed Griffin

“that the senator was unhappy that his earmark for Mississippi

had not been honored.” Id. Griffin testified that he “made a

point in [his] first management meeting . . . that [NASA] would

take care of earmarks immediately” and that he “absolutely

recall[ed] giving that direction to the acting head of legislative

affairs.” Id. at 137. A NASA employee testified that Stadd was

present at that meeting and that, as the meeting attendees were

leaving, the employee heard Griffin indicate to “his [senior]staff

around him which was [Stadd] and the others we need to follow

up on [the earmark issue] and make sure these guys are

following through.” Trial Tr. 146 (Aug. 5, 2009).

On May 11, Stadd met David Shaw (Shaw), the director of

GRI at MSU, for dinner. The two met in the lobby of NASA

headquarters before walking to a nearby restaurant. The next

day, May 12, Stadd notified Greenstone via e-mail of his dinner

with Shaw. The e-mail read, in part:

The conversation involved no reference whatsoever to

NASA. I explained upfront that I am completely

recused from any discussions or actions that might in

any way impinge on MSU. I stressed that I am barred

from any representational work vis-a-vis NASA on

behalf of MSU. Dr. Shaw said that he understood the

rules of engagement.

I also indicated that I would be sending him a summary

of the ethics agreement that is currently being drafted

by NASA ethics attorneys.

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Trial Tr. 7 (Aug. 4, 2009). At trial, Shaw testified the

“[p]rimary focus” of their dinner discussion was MSU’s “efforts

with [the National Oceanic and Atmospheric Administration],”

an issue on which Stadd was advising MSU. Trial Tr. 18-19

(Aug. 5, 2009). He testified they discussed NASA but only “in

very general terms,” including the transition to a new

administrator and administrative team. Id. at 19. Shaw testified

that Stadd did not explain that he (Stadd) was completely

recused from any discussions or actions that might in any way

impinge on MSU, did not stress that he was barred from any

representational work vis-à-vis NASA on behalf of MSU and

did not indicate that he would send Shaw a summary of his

ethics agreement. Further, Shaw testified he (Shaw) did not

remember saying he understood the rules of engagement and

never received a copy or summary of Stadd’s ethics agreement. 

Id. at 20-21.

About one week after their dinner, on May 17, Shaw emailed Stadd regarding a $15 million earmark directed to

NASA’s earth science application program. In the e-mail, Shaw

mentioned he had heard that Mary Cleave (Cleave)—who was

then the acting director of NASA’s sun earth systems division,

which division oversaw the earth science program—intended to

distribute the $15 million through a national competition rather

than through the Mississippi Research Consortium (MRC), a

consortium of four Mississippi research institutions; of the four,

MSU had the largest earth science program. Shaw wrote that

MSU would likely receive no more than a small portion of the

funds if they were distributed through a national competition, a

result he “assure[d]” Stadd would “not sit well with . . . Senator

Cochran.” Trial Tr. 190 (Aug. 4, 2009). Shaw concluded the email by asking Stadd: “Have you been a part of any discussions

on this, can you shed light or provide some prodding?” Id.

On May 26, Stadd copied Shaw on an e-mail in which Stadd

said he was going to meet with Cleave on May 27 “re: the

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Cochran funds.” Gov’t App. Tab 15; Trial Tr. 5-6 (Aug. 5,

2009). Stadd also claimed to “have [Administrator]

Mike[ Griffin’s] endorsement.” Trial Tr. 6 (Aug. 5, 2009).

Cleave testified that before the meeting she “thought it was

probably about Mississippi money” “[b]ecause of this $15

million earmark language and the historical interest of the

Mississippi [congressional] delegation in earth science

applications in Mississippi.” Trial Tr. 69 (Aug. 4, 2009). At the

meeting, Stadd informed Cleave “that a deal had been cut

between the previous [NASA] administrator . . . and the

Mississippi [congressional] delegation and [the $15 million

earmarked funds] needed to go to Mississippi.” Id. at 72. Stadd

did not expressly mention MSU, and Cleave did not know MSU

was Stadd’s client. Cleave “push[ed] back” against Stadd,

explaining that she had planned to distribute the money through

a national competition and that, because the earmark was not

limited to Mississippi, “there would be a lot of push back from

the scientific community” if the moneywent onlyto Mississippi. 

Id. at 73-74. In response, Stadd told Cleave to distribute $3

million of the $15 million through a national competition, with

the other $12 million going to Mississippi. Id. at 74. Cleave

testified that it was not unusual for her to be told how to allocate

funds verbally rather than in writing. Id. at 74-75 (“I know that

$15 million sounds like a lot of money, but when you’re talking

about a $5 billion budget, getting verbal direction on this

amount of money is not unusual.”). She also described the

meeting as “uncomfortable.” Id. at 76. After the meeting, Stadd

e-mailed Shaw and told him “the meeting did not go well” and

“Cleave still intended to put [the money] out for the national

competition.” Trial Tr. 9 (Aug. 5, 2009).

Despite Stadd’s assessment of the meeting, NASA directed

$12 million of the earmark to the MRC. MSU ultimately

received approximately $9.6 million of the $12 million

distributed by the MRC. When NASA first directed the funds

to the MRC, however, Shaw “was very disappointed and very

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upset” about the limits NASA placed on the MRC’s distribution

of the funds and conveyed his position to Stadd. Trial Tr. 12

(Aug. 5, 2009). On June 22, Stadd’s penultimate day at NASA,

he sent the following e-mail to Shaw:

[O]verall I gathered [the NASA requirements were]

framed in a way that constrains GRI from getting the

bulk of the funds. If true, I am beyond pissed. I broke

my fucking (excuse my language) pick to salvage the

funds . . . . Isteered MaryCleave so that Ron had clear

running room. And now am I to believe that the son of

a bitch framed it so that MSU is screwed? . . . If true,

David [Shaw], I do not know what to do. I am literally

out of ideas. If I intervene anymore then all sorts of

red flags will go up and I fear getting MSU and me in

trouble. . . .

. . . Unless you e-mail me back with a different

interpretation of [NASA’s requirements] and [their]

impact on MSU I will have to report back to [Griffin]

that the effort to address Cochran’s concerns has been

a complete failure.

Gov’t App. Tab 16. The following day, Stadd’s last at NASA,

he told Griffin’s chief of staff “that Senator Cochran’s office

was unhappy with the way that the science mission director was

implementing one of his earmarks.” Trial Tr. 63 (Aug. 5, 2009).

The chief of staff told Stadd later that he disapproved of Stadd

“trying to get this earmark directed to Mississippi State” because

it created an “appearance of inappropriate behavior.” Id. at 69;

see id. at 67-70, 76.

 B. MSU’s Payments to Stadd

By invoice dated June 1, Stadd charged MSU $27,450,

primarilyfor assisting his client, GRI, with the National Oceanic

and Atmospheric Administration. Gov’t App. Tab 17. The

invoice also stated that Stadd had “assisted GRI in

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understanding personnel and policy changes at NASA HQ,

including efforts (January – April 15, 2005) to ensure that the

appropriate earth science research programs were appropriately

refocused in areas of potential benefit to MSU/GRI.” Id. Shaw 2

testified that he believed the work described in the June 1

invoice included Stadd’s actions involving the $15 million

earmark while he was a SGE at NASA. Trial Tr. 26 (Aug. 5,

2009). Shaw testified there was nothing else Stadd could have

done pursuant to his consulting agreement with MSU that fit the

description given in the invoice, notwithstanding the purported

ending date of April 15, 2005 Stadd had specified in the invoice.

Id. Further, Shaw testified he did not seek Stadd’s assistance

with the earmark before May 2005, at which point Stadd was

serving as a SGE. Id. at 26-27. In an e-mail dated October 3

31—about four months after Stadd had left NASA—Stadd tried

to increase his compensation from MSU. Gov’t App. Tab 18.

To justify the raise, he listed work performed for MSU,

including “the recoveryof the earmarked NASA procurement.”4

Id. Shaw testified that he believed Stadd was referring to the

$15 million earmark because Stadd had not worked on any other

NASA earmark for MSU during that time. Trial Tr. 33-34 (Aug.

5, 2009).

By indictment filed March 6, 2009, Stadd was charged with

one count of committing an act affecting a personal financial

interest in violation of 18 U.S.C. §§ 208(a) and 216(a)(2) for his

April 15, 2005 is the day Stadd began to serve as interim

2

associate administrator.

 Stadd contends he had a pre-existing contract with MSU, under

3

which he was scheduled to receive payments of $27,496 on specific

dates, including June 1.

 MSU increased Stadd’s monthly compensation but offered him

4

only a six-month contract.

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actions regarding the $15 million earmark and two counts of

making false statements in violation of 18 U.S.C. § 1001(a)(2):

one count based on his May 12, 2005 e-mail to Greenstone

regarding his dinner with Shaw and the second count based on

the statements contained in the ethics agreement he executed

nunc pro tunc on June 13. Following a three-day trial, the jury

convicted Stadd on all three counts on August 6, 2009. The

district court sentenced Stadd to thirty-six months’ probation on

each count, to be served concurrently, a $2500 fine, a $300

special assessment and 100 hours of community service during

the first twelve months of probation.5

II.

We address, first, Stadd’s challenge to the sufficiency of the

evidence and, second, his challenge to the jury instructions.

A. Sufficiency of the Evidence

Stadd challenges the sufficiency of the evidence supporting

the three counts of conviction. “When reviewing a guilty

verdict for sufficiency of the evidence, we view the evidence in

the light most favorable to the Government and must affirm the

verdict if ‘any rational trier of fact could have found the

essential elements of the crime beyond a reasonable doubt.’ ”

United States v. Wynn, 61 F.3d 921, 923 (D.C. Cir. 1995)

In August 2010, Stadd pleaded guilty to one count of conspiracy

5

to defraud the government in violation of 18 U.S.C. § 371. Plea

Agreement, United States v. Stadd, No. 1:09cr108HSO-RHW (S.D.

Miss. Aug. 4, 2010). The allegations in that case also relate to

obtaining funds from NASA for MSU’s use. The court sentenced

Stadd to forty-one months’ imprisonment followed by three years of

supervised release and imposed a $100 assessment, a $7500 fine and

$287,000 in restitution. Judgment, United States v. Stadd, No.

1:09cr108HSO-RHW (S.D. Miss. Nov. 24, 2010).

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(emphasis in original) (quoting Jackson v. Virginia, 443 U.S.

307, 319 (1979)), cert. denied, 516 U.S. 1015 (1995).

 1. 18 U.S.C. § 208(a) Count

There are four elements of the crime set out in 18 U.S.C.

§ 208(a): (1) “an officer or employee of the executive branch of

the United States Government” (2) “participates personally and

substantially as a Government officer or employee” (3) “in a

judicial or other proceeding, application, request for a ruling or

other determination, contract, claim, controversy, charge,

accusation, arrest, or other particular matter” (4) in which he

knows he has a financial interest. Stadd maintains the 6

Government failed to prove the final three elements.

The statute provides, in relevant part:

6

[W]hoever, being an officer or employee of the

executive branch of the United States Government,

. . . including a special Government employee,

participates personally and substantially as a

Government officer or employee, through decision,

approval, disapproval, recommendation, the

rendering of advice, investigation, or otherwise, in a

judicial or other proceeding, application, request for

a ruling or other determination, contract, claim,

controversy, charge, accusation, arrest, or other

particular matter in which, to his knowledge, he, his

spouse, minor child, general partner, organization in

which he is serving as officer, director, trustee,

general partner or employee, or any person or

organization with whom he is negotiating or has any

arrangement concerning prospective employment, has

a financial interest—Shall be subject to the penalties

set forth in section 216 of this title.

18 U.S.C. § 208(a). Section 216 of Title 18 sets forth the penalties for

a violation of section 208, including imprisonment and/or a fine. 18

U.S.C. § 216.

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Taking the third element first, we conclude that there was

ample evidence from which the jury could conclude the

allocation of the earmarked funds was indeed a “particular

matter” within the meaning of the statute. Stadd relies upon the

definition of “particular matter” contained in 5 C.F.R. §

2635.402(b)(3) as “encompass[ing] only matters that involve

deliberation, decision, or action that is focused upon the interests

of specific persons, or a discrete and identifiable class of

persons.” Accordingly, “particular matter” does not include “the

consideration or adoption of broad policy options that are

directed to the interests of a large and diverse group of persons.”

Id. Stadd claims he did not participate in a “particular matter”

because his actions focused on the State of Mississippi, which

consists of “a large and diverse group of persons,” and not upon

the interests of “specific persons, or a discrete and identifiable

class of persons.” The flaw in his argument is that the $15

million earmark did not go to the State of Mississippi; it went

instead to the MRC, to be divided among its four member

institutions, with the lion’s share—$9.6 million of $12

million—going to MSU’s GRI, Stadd’s client. Stadd intended

that the funds go to the MRC and they did so. Moreover, 7

Stadd’s June 22 e-mail plainly manifested his frustration that

MSU might get “screwed” out of the funds. Gov’t App. Tab 16. 

A reasonable jury could conclude from the evidence that Stadd

was focused, at most, on the interests of the four research

institutions comprising the MRC and, in particular, on MSU’s

interests. The four member institutions of the MRC are

sufficiently discrete and identifiable that Stadd participated in a

“particular matter” under the statute.

Shaw’s May 17 e-mail to Stadd that prompted Stadd to meet

7

with Cleave did not complain that the earmarked funds were not going

to Mississippi but that they were not going “through the MRC.” Trial

Tr. 188-89 (Aug. 4, 2009).

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Having determined that ample evidence supported the third

element of a section 208(a) violation, we next conclude that,

again, ample evidence supported the second element. Stadd

participated both “personally and substantially” in the

distribution of the earmarked funds. Cleave planned to

distribute the funds through a national competition. Stadd

persuaded Cleave, however, to allocate $12 million of the $15

million earmark to the MRC. Of that $12 million, MSU

received nearly $10 million.8

Finally, we conclude that sufficient evidence supports the

fourth element—that Stadd knew he had a financial interest in

the “particular matter.” In addition to a consultant’s obvious

financial interest in an award of millions of dollars to one of his

We reject Stadd’s argument that he simply effectuated the intent

8

of the Congress that the earmarked funds go to Mississippi. The

legislation directed that the funds “be used to support competitivelyselected applications projects.” H.R. Rep. No. 108-792, at 1602

(2004) (Conf. Rep.); see Consolidated Appropriations Act of 2005,

Pub. L. No. 108-447, 118 Stat. 2809, 3333-35 (2004). Even if there

were a congressional understanding that the funds be directed to

Mississippi, Stadd’s actions nonetheless violated section 208(a). As

the Seventh Circuit has explained, the Congress intended section

208(a) “to proscribe rather broadly employee participation in business

transactions involving conflicts of interest and to reach activities at

various stages of these transactions.” United States v. Irons, 640 F.2d

872, 876 (7th Cir. 1981). For that reason, section 208(a) reaches “acts

which execute or carry to completion a contract or matter as to which

the acts of rendering advice or making recommendations are

specifically proscribed.” Id. at 878; accord United States v. Selby, 557

F.3d 968, 971 (9th Cir. 2009) (per curiam) (affirming conviction under

section 208 where employee had not participated in initial contract

between her employer and her husband’s employer but used her

position to “promote[] extensive additional use of [her husband’s

employer’s] software and participated in the decision-making process

to implement further use of [her husband’s employer’s] products”).

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clients, Stadd submitted an invoice to MSU on June 1—while he

was still working at NASA—in which Stadd sought

compensation for his involvement in the award process.

Moreoever, after he left NASA, Stadd sought a raise from MSU

and listed “the recovery of the earmarked NASA procurement”

as a service he had performed for MSU. Finally, Stadd

disclosed in the ethics agreement that his financial interests

included his consulting services to MSU and acknowledged

“that because [he] may resume [his] business relationships [with

his clients] following [his] departure from NASA, [he would]

still be considered to have a financial interest in [those] entities,

and [would] therefore recuse [himself] from actions involving

them.” Gov’t App. Tab 11 at 2. In sum, we conclude there was

sufficient evidence to support Stadd’s conviction on the section

208(a) count.

 2. 18 U.S.C. § 1001 Counts

Section 1001 of Title 18 of the U.S. Code provides, in

relevant part:

[W]hoever, in any matter within the jurisdiction of the

executive, legislative, or judicial branch of the

Government of the United States, knowingly and

willfully . . . makes any materially false, fictitious, or

fraudulent statement or representation . . . shall be

fined under this title[ or] imprisoned not more than 5

years . . . .

18 U.S.C. § 1001(a). Stadd claims that the statements the

government prosecuted him for making were not “materially”

false. He relies upon the Fifth Circuit’s decision in United

States v. Baker, 626 F.2d 512 (5th Cir. 1980), which held that a

statement is “materially” false under section 1001 only if it has

“the capacity to influence a determination required to be made.”

Id. at 514 (quotation marks and citation omitted). Stadd argues

neither of his statements influenced a determination required to

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be made by NASA and neither was, therefore, “materially”

false. Stadd’s reliance on Baker is misplaced. The United

States Supreme Court has adopted a different definition of

materiality under section 1001: “In general, a false statement is

material if it has a natural tendency to influence, or [is] capable

of influencing, the decision of the decisionmaking body to

which it was addressed.” Neder v. United States, 527 U.S. 1, 16

(1999) (brackets in original) (quotation marks and citation

omitted). Neder’s definition is of course the accepted definition

of materiality. See United States v. Moore, 612 F.3d 698, 701

(D.C. Cir. 2010) (“We now join the other circuits in holding a

statement is material if it has a natural tendency to influence, or

is capable of influencing, either a discrete decision or any other

function of the agency to which it was addressed.”); United

States ex rel. Longhi v. United States, 575 F.3d 458, 468 (5th

Cir. 2009) (using Neder definition of materiality); United States

ex rel. Loughren v. Unum Grp., 613 F.3d 300, 307 (1st Cir.

2010) (same); United States v. Jackson, 546 F.3d 801, 815 (7th

Cir. 2008) (same); United States v. Heppner, 519 F.3d 744, 749

(8th Cir. 2008) (same); United States v. Bourseau, 531 F.3d

1159, 1171 (9th Cir. 2008) (same); Fla. State Conference of

NAACP v. Browning, 522 F.3d 1153, 1173 (11th Cir. 2008)

(same); United States v. Rigas, 490 F.3d 208, 231 (2d Cir. 2007)

(same); United States v. McAuliffe, 490 F.3d 526, 531 (6th Cir.

2007) (same); United States v. Fallon, 470 F.3d 542, 546 (3d

Cir. 2006) (same); United States v. Pasquantino, 336 F.3d 321,

333 (4th Cir. 2003) (same). The jury charge correctly used this

definition of materiality.

9

The jury instruction read: “A statement is ‘material’ if it has a

9

natural tendency to influence, or is capable of influencing, the decision

of the decision-making body to which it was addressed. Proof of

actual reliance on the statement is not required. The Government need

only make a reasonable showing of its potential effects.” App. 118,

United States v. Stadd, No. 09-3121 (D.C. Cir. Apr. 29, 2010) (App.).

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Stadd does not—and could not—argue that his statements

in his May 12 e-mail to Greenstone—statements contradicted by

Shaw’s testimony—were not capable of influencing

Greenstone’s actions as a lawyer in NASA’s general counsel’s

office. Stadd was a high-ranking—albeit interim—federal

official who had a consultant business in the private sector. In

anticipation of Stadd’s potential conflicts of interests, NASA’s

general counsel’s office “wanted to make sure that someone was

assigned to pay attention to [Stadd], [and] to give . . . Stadd the

level of help that he needed to ensure compliance [with the

ethics laws].” Trial Tr. 53 (Aug. 3, 2009) (testimony of

Greenstone). Given Stadd’s high-level position and his ties to

the private sector, a reasonable jury could conclude Greenstone

would have paid special attention to Stadd. Greenstone’s

testimony plainly supported that conclusion. See id. at 66

(Greenstone’s testimony that he spent more time working with

Stadd during Stadd’s tenure than with any of the “dozens” of

other NASA employees he advised). A reasonable jury could

further infer from the evidence that, if Stadd had accurately

reported the substance of his dinner conversation with Shaw, it

would have raised red flags that would have led Greenstone to

inquire further. Because Stadd misrepresented his discussion

with Shaw, however, Greenstone saw no need to take any

further action to ensure Stadd’s compliance with applicable

ethics laws and accepted Stadd’s assertions. See Trial Tr. 9

(Aug. 4, 2009) (Greenstone’s testimony that he accepted Stadd’s

e-mail representations as true because he “had no reason to

doubt [] Stadd’s veracity” and because Stadd expressed his

“intention of working with [the general counsel’s office] to

follow the law”).

Similarly, Stadd’s execution of the ethics agreement gave

Greenstone a “high level of confidence” that Stadd understood,

and pledged to comply with, the applicable ethics laws. Id. at

17-18. We reject Stadd’s argument that his execution of the

ethics agreement cannot be material because he did not do so

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until after he met with Cleave. The ethics agreement covered

the entire term of Stadd’s service as a SGE, as evidenced by the

agreement itself, which recited that it covered “[Stadd’s] federal

service commencing April 28, 2005.” Gov’t App. Tab 11 at 1

(emphasis added). Moreover, Stadd pledged in the agreement

not to participate in matters involving his clients “in the course

of [his] NASA official duties” or to represent another person or

organization or his own private interests “[d]uring [his] tenure

with NASA.” Id. at 2. That Stadd signed the agreement after

having violated its terms makes it, if anything, easier to

conclude he “knowingly and willfully” made a “materially false,

fictitious, or fraudulent statement or representation.” 18 U.S.C.

§ 1001(a)(2).

B. Jury Charge on 18 U.S.C. § 208(a) Count

Finally, Stadd challenges the district court’s jury charge

describing a violation of section 208. We review jury 10

instructions de novo. Conseil Alain Aboudaram, S.A. v. de

Groote, 460 F.3d 46, 52 (D.C. Cir. 2006). Stadd contends the

district court should have instructed the jury using the language

The jury instruction recited three elements of a section 208(a)

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violation:

One: Defendant Stadd was a special Government

employee of NASA;

Two: The defendant participated personally and

substantially as a special Government employee

through decision, approval, disapproval,

recommendation, the rendering of advice,

investigation or otherwise in a matter in which

he knew that he had a financial interest; and

Three: The defendant acted willfully.

App. 117.

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of 5 C.F.R. § 2640.103. Stadd maintains that NASA’s general 11

counsel’s office advised him, using the regulation as the

controlling law. According to section 2640.103, a defendant

violates section 208(a) only “if the particular matter [in which

he participates] will have a direct and predictable effect on [his

financial] interest.” 5 C.F.R. § 2640.103(a). Accordingly, Stadd

argues the district court omitted an essential element of the

offense charged in count one. His argument fails. 

Even if “direct and predictable effect” were an element of

the offense on which the jury should have been instructed, its

omission was, at most, harmless error. See Neder, 527 U.S. at 12

15 (“[T]he omission of an element [from a jury instruction] is an

error that is subject to harmless-error analysis . . . .”). “Where

there has been an error in instructions, we have held such error

to be harmless if the jury necessarily found facts that would

have satisfied a proper instruction.” United States v. Johnson,

216 F.3d 1162, 1166 (D.C. Cir. 2000). Stadd’s counsel argued

to the jury that Stadd did not “know” he had a financial interest

within the meaning of section 208(a) because he “believed” his

participation had to have a direct and predictable effect on his

Section 2640.103 was promulgated under 18 U.S.C.

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§ 208(d)(2), which authorizes the Office of Government Ethics, after

consultation with the Attorney General, to “issue uniform regulations

for the issuance of waivers and exemptions” from section 208(a) and

to “provide guidance with respect to the types of interests that are not

so substantial as to be deemed likely to affect the integrity of the

services the Government may expect from the employee.”

Because we conclude that any error regarding the court’s

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failure to charge the jury that Stadd’s participation must have had a

“direct and predictable effect” was harmless, we need not decide

whether a “guidance” issued under 18 U.S.C. § 208(d)(2)(B), at least

to the extent it further defines “financial interest,” must be considered

an element of the offense and therefore be included in the jury charge.

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financial interest for the rule to be trigered. Trial Tr. 40, 51, 59,

62 (Aug. 6, 2009). The jury nonetheless convicted Stadd of

violating section 208(a) and specifically found that he had

sufficient knowledge to act “willfully.” We can thus conclude

it necessarily found facts that would have supported a guilty

verdict had the “direct and predictable effect” language been

included. In addition, Stadd’s e-mails to Greenstone belie his

claim that he believed he was prohibited from participating in

only those matters with a direct and predictable effect on his

financial interest. In those e-mails, Stadd stated that he was

avoiding matters that directly or indirectly affected his clients. 

Gov’t App. Tabs 8, 9. Accordingly, even if the district court

erred by not including the “direct and predictable effect”

language in the jury charge, its error was harmless.

For the foregoing reasons, Stadd’s conviction is affirmed.

So ordered.

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