Opinion ID: 3013689
Heading Depth: 2
Heading Rank: 2

Heading: materiality, the Court distinguished the

Text: error at issue – a jury instruction that Rule 52(a) of the Federal Rules of omitted materiality as an element of the Criminal Procedure, which governs direct offense – from the constitutional violations appeals from judgments of conviction in it had previously found were not subject to the federal system, provides that “[a]ny harmless-error review. See, e.g., Gideon error, defect, irregularity or variance that v. Wainwright, 372 U.S. 335 (1963); does not affect substantial rights must be Tumey v. Ohio, 273 U.S. 510 (1927). disregarded.” Although Rule 52(a), by its Those cases contained a “‘defect affecting 5 the framework within which the trial Turning first to McLaughlin’s proceeds, rather than simply an error in the conviction under 29 U.S.C. § 439(b), we trial process itself.’” Neder, 527 U.S. at 8 note that the United States must prove that (quoting Arizona v. Fulminante, 499 U.S. the defendant submitted a required 279, 310 (1991)). Such errors “‘infect the document or report in which he entire trial process,’” Neder, 527 U.S. at 8 “‘knowingly fail[ed] to disclose a material (quoting Brecht v. Abrahamson, 507 U.S. fact.’” A fact is “material” if it has “‘a 619, 630 (1993)), and “‘necessarily render natural tendency to influence, or [is] a trial fundamentally unfair.’” Neder, 527 capable of influencing, the decision of the U.S. at 8 (quoting Rose v. Clark, 478 U.S. decisionmaking body to which it was 570, 577 (1986)). addressed.’” Gaudin, 515 U.S. at 509 (quoting Kungys v. United States, 485 By contrast, Neder held that an U.S. 759, 770 (1988)). Moreover, the instruction that omits an element of the issue is whether an omission was capable offense does not necessarily render a of influencing and not whether the criminal trial fundamentally unfair or an omission actually exerted any influence on unreliable vehicle for determining guilt or the factfinder. Thus, an omission can be innocence. The Neder Court therefore material even if no one actually relied on held that the harmless error review it. In re Cohn, 54 F.3d 1108, 1114 (3d Cir. codified at Rule 52(a) applies when a trial 1995). court erroneously instructs a jury that materiality is a question of law to be McLaughlin was charged under 29 resolved by the court rather than a question U.S.C. § 439(b) with failing to disclose of fact to be resolved by the jury. certain items on a required annual public disclosure report, known as an “LM2 Under the test set forth in Chapman report,” which he had prepared and filed v. California, 386 U.S. 18 (1967), to on EMCAL’s behalf with the DOL. Such determine whether a constitutional error is reports are the means by which the DOL, harmless, a reviewing court must decide union members, and the general public whether the record shows “beyond a obtain financial information about a reasonable doubt that the error complained particular union. In an LM2 report, a of did not contribute to the verdict union must disclose, among other things, obtained.” Id. at 24. In other words, an disbursements it has made to its officers – “otherwise valid conviction should not be including salaries, reimbursed expenses, set aside if the reviewing court may and direct or indirect payments. Here, the confidently say, on the whole record, that Government alleged that McLaughlin had the constitutional error was harmless omitted $11,099.04 on the 1993 LM2 beyond a reasonable doubt.” Delaware v. r e p o r t – $ 6 , 5 4 7 . 6 2 i n a l l eg e d Van Arsdall, 475 U.S. 673, 681 (1986). reimbursements McLaughlin received from EMCAL for meals, mileage, parking 6 and tolls, and $4,551.42 in alleged life, other crime at issue). health, and retirement benefits. More fundamentally, even if we McLaughlin notes that the verdict were to conclude that McLaughlin’s 90% form that was eventually submitted to the figure was correct, there can be no jury with respect to the 29 U.S.C. § 439(b) conclusion but that th e om itted count did not subdivide or otherwise break information in the LM2 report was down the various alleged reimbursements material. McLaughlin argues that the total and benefits that he had purportedly failed monetary value of the omitted information to report in the 1993 LM2 report. Rather, was small in comparison with his total the verdict form simply asked for a salary and EMCAL’s total expenditures decision of guilty or not guilty. He points for 1993. This however, is irrelevant. As out that at sentencing the District Court, noted by the United States Court of for purposes of calculating a loss amount Appeals for the Sixth Circuit: as to the embezzled funds, gave him “credit” for several expected pay increases The fact that the misstated that he had foregone as President by amounts are relatively small offsetting his foregone salary increases when compared with total against the extra benefits and remuneration union expenditures is not McLaughlin had fraudulently received. particularly relevant to the McLaughlin argues that in light of the issue of materiality. Instead, District Court’s crediting at sentencing, the relevant inquiry is this court should find that he had disclosed whether the false approximately 90% of his earnings and information is of the type reimbursements, and thus that the jury, t h a t i s c a p a b le o f properly instructed, may not have found influencing a decision of an that the omitted informatio n was agency, as opposed to an “material.” e x a m i n a t io n o f t h e magnitude of the falsehood. McLaughlin’s argument is flawed. First, his 90% calculation is dubious. In Hughes v. United States, 899 F.2d 1495, arriving at this figure, McLaughlin makes 1499 (6th Cir. 1990); see also United multiple unwarranted inferences and States v. Norris, 749 F.2d 1116, 1122 (4th conclusions. Second, it is unclear how the Cir. 1984) (stating, in context of 18 U.S.C. District Court’s calculation of loss amount § 1001, “it is not the size of the payments as to the embezzled funds (the subject of but it is the act of making a false statement one of the crimes) is in any way related to about the payments that is material”). the monetary value of the reimbursements Certainly, the undisclosed information in and benefits McLaughlin failed to disclose the LM2 report was capable of influencing in the 1993 LM2 report (the subject of the the decision of the decisionmaking body to 7 which it was addressed. Gaudin, 515 U.S. testimony respecting Martello and the at 509. Under 29 U.S.C. § 431(b)(3), receipt, which directly contradicted McLaughlin was required to disclose all of Martello’s trial testimony that he had been the reimbursements and benefits he unaware of the existence of the charge received from EMCAL. His omissions card, was plainly capable of influencing were therefore material. the jury. We reach the same conclusion with We also find McLaughlin’s respect to McLaughlin’s conviction for argument regarding the March 1999 perjury under 18 U.S.C. § 1623, based on mistrial unpersuasive. The fact that the his testimony during the first trial that March 1999 jury was unable to return a Martello had used the charge card to make verdict is not germane to the issue of a legitimate union purchase at Staples. On whether the jury in the second trial would appeal, McLaughlin argues that his have found materiality if given the primary defense at that trial to the 29 opportunity to have done so. U.S.C. § 501(c) charges was that every expenditure made with the charge card In sum, it is patent that was a legitimate EMCAL expense. Thus, McLaughlin’s false testimony respecting he continues, his testimony that other Martello’s use of the charge card had a union officials used the charge card was natural tendency to influence and was tangential to his theory of the case. capable of influencing the decision of the Because this defense revolved around the decisionmaking body to which it was legitimacy of the charged expenditures, not addressed, Gaudin, 515 U.S. at 509. We the identity of the charge card’s user, are satisfied that a properly instructed jury McLaughlin argues that his statements could not have found otherwise. Thus, regarding Martello’s purported use of the although the District Court incorrectly charge card were immaterial. He also instructed the jury, we conclude that the suggests that the jury’s inability to return a record shows “beyond a reasonable doubt verdict after the M arch trial calls into that th[is] error . . . did not contribute to question the materiality of his lies. the verdict obtained.” Chapman, 386 U.S. at 24. We do not find McLaughlin’s arguments convincing. Whether or not III. union officials other than McLaughlin had used the charge card was an important McLaughlin also argues that his issue at the March 1999 trial. Testimony counsel provided ineffective assistance by suggesting that other individuals had used losing a critical piece of evidence and in the charge card was capable of raising turn by stipulating to damaging facts doubts in jurors’ minds as to whether regarding the evidence. McLaughlin was guilty. McLaughlin’s 8 It is well settled in this court that counsel’s stipulation that the photocopy of Sixth Amendment ineffective assistance of Defense Exhibit 2 (introduced as counsel claims under Strickland v. Government’s Exhibit 282 at retrial) and Washington, 466 U.S. 668 (1984), are the merchant’s copy of a receipt received generally not entertained on a direct from Staples’ corporate headquarters appeal. See, e.g., United States v. (Government’s Exhibit 265-A at the Headley, 923 F.2d 1079, 1083 (3d Cir. retrial) were, in fact, part of the same 1991). This refusal to entertain Strickland multi-page receipt. Where a claim of claims on direct review stems from the ineffective assistance of counsel is based reality that “such claims frequently involve on attorney incompetence, the lack of a questions regarding conduct that occurred fully developed record often precludes a outside the purview of the district court comprehensive inquiry into the elements and therefore can be resolved only after a of strategy or tactics that may have entered factual development at an appropriate into defense counsel’s challenged decision. hearing.” Gov’t of Virgin Islands v. Zepp, Zepp, 748 F.2d at133. 748 F.2d 125, 133 (3d Cir. 1984) (internal quotations and citations omitted); see also Neither aspect of McLaughlin’s United States v. Theodoropoulos, 866 F.2d Strickland claim fits into that narrow class 587, 598 (3d Cir.1989) (“[T]he proper of ineffectiveness claims amenable to avenue for pursuing such a claim is review on direct appeal. McLaughlin’s through a collateral proceeding.”). ineffective assistance of counsel claim is thus premature. We have, however, recognized a narrow exception to the rule that a IV. defendant cannot argue on direct appeal that counse l’s perfo rman ce fa iled For the reasons set forth, we will constitutional standards. As we stated in affirm the District Court’s judgment of Headley, “[W]here the record is sufficient conviction and sentence and dismiss to allow determination of ineffective without prejudice the appeal to the extent assistance of counsel, an evidentiary that it claims ineffective assistance of hearing to develop the facts is not needed.” counsel. 923 F.2d at 1083. This case does not fit into this narrow exception. The record must be developed as to the facts surrounding counsel’s possession and storage of Defense Exhibit 2, as well as the cause or causes of its loss. Similarly, on the record before us, we cannot determine the reasonableness of 9