Opinion ID: 174534
Heading Depth: 3
Heading Rank: 3

Heading: Counts III & IV: False Statements to FBI Agent

Text: Lupton's third and fourth convictions both stemmed from 18 U.S.C. § 1001, which makes it a crime to knowingly and willfully make a materially false statement in connection with a matter within the jurisdiction of a federal agency, here, the FBI. See United States v. Ringer, 300 F.3d 788, 791 (7th Cir.2002). Count III was predicated upon Lupton's May 10, 2007, assertion to FBI Agent Sparacino that he had never provided prospective buyers with specific details from bids submitted by competing prospective buyers. Count IV rested on Lupton's May 18, 2007, claim to FBI Agent Sparacino that he had never suggested to Silverstein that he be paid in cash or by check payable to any company other than Equis. The district court found that Lupton knowingly and willfully made both these statements in the course of a matter within the jurisdiction of the United States, and that the statements were false and material. Lupton claims the statements were not knowingly and willfully made because he had a good faith belief that the conduct he was denying was legal. Lupton also claims that the district court erred in its determination that the statements were material, because the statements had no actual effect on the investigation: FBI agents already had in their possession the tapes of Lupton and Silverstein's conversations when they questioned Lupton. In his reply brief, he also argues that his statements constituted an exculpatory no and thus could not serve as a basis for liability. Lupton contends that his statements could not have been made knowingly or willfully because he believed in good faith that he was obligated to disclose bid details to competing bidders and that he was engaging in legitimate commission splitting negotiations. But the knowingly and willfully requirement in 18 U.S.C. § 1001 relates only to the defendant's knowledge and intent that the statements he made to a government entity were false or were made with the conscious purpose of evading the truth. United States v. Dick, 744 F.2d 546, 553 (7th Cir.1984). It has nothing to do with the legality of the underlying conduct about which the defendant spoke. Lupton told the agents that he never disclosed specific information from prospective buyers' bids to other prospective buyers. That statement did not concern his ability or lack thereof to disclose the information; the issue was whether he disclosed it. Like the agent to whom he was speaking, Lupton knew he had disclosed specific information from Roebling's proposal to Silverstein and therefore had to know that his statement to the contrary was false. Similarly, Lupton knew that his statement about never having discussed payments made directly to him or to NACO was false when he made it, for he had recently engaged in a lengthy, in-person conversation with Silverstein about that very topic. Lupton never told the agents about his alleged beliefs that his conduct was legal. He didn't say something like, Yes, I shared those details, but I thought I was required to by Wisconsin law. To the contrary, he flatly denied ever sharing bid information or discussing payments to NACO. And given the ample evidence that he was aware he had in fact done those very things, we cannot conclude that the district court clearly erred. We likewise hold that district court did not clearly err in concluding that both of Lupton's statements filled the materiality bill. To be material for purposes of 18 U.S.C. § 1001, a statement must have a natural tendency to influence, or be capable of influencing, the decision of the decisionmaking body to which it was addressed. Turner, 551 F.3d at 663 (quotation omitted). We do not require the statement to actually influence the agency to which it was directed, or even that the agency rely on the statement in any way. See id.; United States v. Burke, 425 F.3d 400, 409 (7th Cir.2005) (That the prosecutors knew (or thought they knew) the answers to the questions they asked Burke does not make the information less material.); United States v. Ranum, 96 F.3d 1020, 1028 n. 12 (7th Cir.1996) ([I]t is not necessary for an allegedly false statement to have any ill effect at all, as long as it is capable of having such an effect.). Instead, we have recognized, like many of our sister circuits, that a frequent aim of false statements made to federal investigators is to cast suspicion away from the declarant, which in the ordinary course would have an intrinsic capability . . . to influence an FBI investigation. Turner, 551 F.3d at 664.; see id. at 663-64 (collecting cases). When statements are aimed at misdirecting agents and their investigation, even if they miss spectacularly or stand absolutely no chance of succeeding, they satisfy the materiality requirement of 18 U.S.C. § 1001. Lupton's May 10 statement that he never shared specific bid details from prospective buyers with other prospective buyers could only have been designed to cast suspicion away from him, with respect to both his relationship with Silverstein and any similar arrangements he might have had with other prospective buyers. If the agents hadn't had the tapes of Lupton divulging the contents of Roebling's and Arlen's bids to Silverstein, Lupton's statement might reasonably have caused them to turn their attention away from him. That is enough for a factfinder to conclude that the statement was material; it is of no moment that the agents did have the tapes and that the statement thus had no actual impact on the investigation. And the May 18 statement, in which Lupton denied ever suggesting that Silverstein pay him in cash or pay NACO by check, was also of the type that would naturally tend to influence the course of the agents' investigation. Indeed, Agent Sparacino testified that he came away from the interview with a sense that Lupton was trying to deflect the agents' focus from him. Tr. 141, Mar. 2, 2009. Lupton forfeited his exculpatory no argument by raising it for the first time in his reply brief. See Boyle, 484 F.3d at 946. But even if he hadn't, the argument would be without traction because the Supreme Court has clearly held that the plain language of § 1001 admits of no exception for an `exculpatory no.' Brogan v. United States, 522 U.S. 398, 408, 118 S.Ct. 805, 139 L.Ed.2d 830 (1998); United States v. Brandt, 546 F.3d 912, 917 (7th Cir.2008) (In Brogan, the Supreme Court explicitly and unequivocally rejected the `exculpatory no' doctrine as a defense to criminal liability under § 1001.). And in any event, Lupton said much more than no during his two interviews with the FBI, so this isn't a situation in which one could even reasonably advocate for the resurrection of the defunct exculpatory no doctrine. Lupton chose to lie to Agent Sparacino, and he must live with the consequences of that choice. Burke, 425 F.3d at 409.