Opinion ID: 206048
Heading Depth: 3
Heading Rank: 2

Heading: Federal-Funds Counts (Counts Five through Eight)

Text: The indictment charges Schmitz with four counts of theft concerning a program receiving federal funds, in violation of 18 U.S.C. § 666(a)(1)(A). The federal-funds counts incorporate the first two paragraphs of the indictment, which describe Schmitz's background and the CITY Program, but they do not incorporate or re-allege any of the allegations of fraud in the mail-fraud counts. Instead, the federal-funds counts allege that Schmitz was an agent of the CITY Program, and the CITY Program received federal benefits in excess of $10,000 per year. The indictment then charges that Schmitz, from January 2003 to October 2006, knowingly and willfully did embezzle, steal, obtain by fraud and without authority convert to her own use, and intentionally misapply the salary she received from the CITY Program from 2003 through 2006, with each year of salary representing a separate count. (Dkt. 1 at 5-6.) Schmitz argues that the allegations of fraud in the federal-funds counts are insufficient because they do not present the essential elements of fraud and do not notify her of the charges to be defended against. Schmitz points out that the federal-funds counts provide no factual allegations whatsoever regarding the scheme to defraud, and do not incorporate any of the allegations of fraud in the mail-fraud counts. We hold that the allegations of fraud in the federal-funds counts are insufficient because they provide absolutely no factual detail regarding the scheme to defraud the CITY Program. As we have previously noted, for an indictment to be legally sufficient, it must notify the accused of the charges to be defended against. The indictment must contain a plain, concise, and definite written statement of the essential facts constituting the offense charged[.] Fed.R.Crim.P. 7(c)(1) (emphasis added). Even when an indictment tracks the language of the statute, `it must be accompanied with such a statement of the facts and circumstances as will inform the accused of the specific offense, coming under the general description, with which he is charged.' United States v. Bobo, 344 F.3d 1076, 1083 (11th Cir.2003) (citing Russell v. United States, 369 U.S. 749, 765, 82 S.Ct. 1038, 1048-49, 8 L.Ed.2d 240 (1962)). Counts Five, Six, Seven, and Eight simply allege that Schmitz did embezzle, steal, obtain by fraud and without authority convert to her own use, and intentionally misapply the salary and other benefits she received from the CITY Program. (Dkt. 1 at 5-6.) While this language tracks 18 U.S.C. § 666, the federal-funds counts allege no facts or circumstances that inform Schmitz of these specific charges. As a result, the allegations of fraud in the federal-funds counts are insufficient as a matter of law. We reject the Government's contention that the federal-funds counts sufficiently charge fraud if the indictment is considered as a whole, and given a common-sense construction. The Government would have us overlook the complete absence of factual allegations in the federal-funds counts because the mail-fraud counts adequately describe Schmitz's fraudulent scheme. This we cannot do because it would contradict the principle that each count of an indictment must be regarded as if it were a separate indictment and must stand on its own content without dependence for its validity on the allegations of any other count not expressly incorporated. United States v. Huff, 512 F.2d 66, 69 (5th Cir.1975) (citations omitted). [9] The Government is correct that we have previously stated that the validity of an indictment is determined from reading it as a whole. Jordan, 582 F.3d at 1245; United States v. Diwan, 864 F.2d 715, 719 (11th Cir.1989); Markham, 537 F.2d at 192. But that does not mean factual allegations in one count are somehow automatically incorporated into other counts. To the contrary, courts have explained that when allegations in one count are incorporated into another count under Federal Rule of Criminal Procedure 7(c), such incorporation must be express. Davis v. United States, 357 F.2d 438, 440 n. 2 (5th Cir.1966); United States v. Redcorn, 528 F.3d 727, 734-35 (10th Cir.2008) (There is no need to look beyond the borders of a particular count to determine what offense is charged; indeed, it is generally improper to do so except where a count incorporates other allegations expressly, as permitted by Federal Rule of Criminal Procedure 7(c)(1).); United States v. Knowles, 29 F.3d 947, 952 (5th Cir.1994) (While it is true that an allegation made in one count of an indictment may be incorporated by reference in another count of the indictment, we have held that any such incorporation must be expressly done.) (internal citation omitted); United States v. Miller, 774 F.2d 883, 885 (8th Cir. 1985) (citing Huff and concluding that each count of an indictment must stand on its own, and cannot depend for its validity on the allegations of any other count not specifically incorporated) (internal quotation marks and citation omitted); United States v. Fulcher, 626 F.2d 985, 988 (D.C.Cir.1980) (citing Huff and concluding that one count cannot absorb by osmosis the allegations of another count). [10] The rule requiring express incorporation by reference is especially important in this case, where it is not at all apparent from the face of the indictment that the facts of the mail-fraud counts overlap with the facts of the federal-funds counts. The federal-funds counts (Counts Five through Eight) do not stand on their own content, and do not expressly incorporate any allegations about the scheme to defraud from the mail-fraud counts. And, the district court did not instruct the jury that the federal-funds counts required proof of the scheme to defraud alleged in the mail-fraud counts. We therefore conclude that the district court erred in denying Schmitz's motion to dismiss the fraud charges in the federal-funds counts. While we have concluded that the fraud charges in the federal-funds counts are insufficient, we must still address whether Schmitz's convictions on these counts can stand. The federal-funds counts allege all five means by which § 666(a)(1)(A) can be violated. That is, the indictment alleges that Schmitz knowingly and willfully did embezzle, steal, obtain by fraud and without authority convert to her own use, and intentionally misapply the salary she received as a CITY Program employee. (Dkt. 1 at 5-6.) The district court instructed the jury that Schmitz could be found guilty of an offense under § 666(a)(1)(A) if she misapplied, embezzled, stole, obtained by fraud, or otherwise without authority . . . [] convert[ed] to her own use the money she received from the CITY Program. (Dkt. 199 at 2022-23.) The court did not specifically instruct that any one means is sufficient to convict Schmitz on the federal-funds counts, but the use of the disjunctive word or suggests that this was the intent of the charge. We are thus faced with the question of whether the jury's general verdict convicting Schmitz on the federal-funds counts can stand where one of the alternate theories of criminal liability in those counts is based on a legally insufficient indictment. [11] We find that the convictions on the federal-funds counts cannot stand because the allegations of fraud in those counts are legally insufficient, and we do not know whether the jury relied on those legally insufficient allegations in convicting Schmitz on the federal-funds counts. See Griffin v. United States, 502 U.S. 46, 59, 112 S.Ct. 466, 474, 116 L.Ed.2d 371 (1991) (noting that jurors in a criminal case are well equipped to analyze the evidence in order to avoid resting a guilty verdict on a factually inadequate theory, but are not generally equipped to determine whether a particular theory of conviction submitted to them is contrary to law); United States v. Shotts, 145 F.3d 1289, 1293 n. 3 (11th Cir.1998) (A general verdict which may rest upon an insufficient legal theory must be reversed.). [12] We accordingly vacate Schmitz's convictions on Counts Five, Six, Seven, and Eight.