Legal Document

494 U.S. 152 110 S.Ct. 997 108 L.Ed.2d 132 Lawrence H. CRANDON, et al., Petitioners,v.UNITED STATES. BOEING COMPANY, INC., Petitioner, v. UNITED Nos. 88-931, 88-938. Argued Nov. 6, 1989. Decided Feb. 27, 1990. Syllabus When the individual petitioners terminated their employment with petitioner Boeing Company to accept important positions in Executive Branch of Federal Government, made each, before he became a Government employee, an unconditional lump-sum payment mitigate substantial loss each expected suffer by reason his change employment. Subsequently, United States filed civil complaint District Court, seeking damages from and imposition constructive trust on moneys received petitioners. The alleged that payments had been supplement petitioners' compensation as federal employees, they created conflict interest situation which induced breach fiduciary duty undivided loyalty owed measured by, inter alia, 18 U.S.C. § 209(a), makes it crime for private party pay, employee receive, supplemental employee's service. court held, among other things, 209(a) not violated because were recipients become employees intended compensate them Court Appeals reversed, holding, status at time is element violation, finding be service was clearly erroneous. Held: Section does apply severance encourage payee employment, but becomes employee. Pp. 157-168. (a) 209(a)'s text indicates offense. Neither its two prohibitions—the one directed every person who "receives" any salary "as services officer or employee" "pays," contribution of, "any employee"—directly specifies when must received. However, literal reading second prohibition supports conclusion made, prohibitions appear coextensive coverage both sides single transaction. 158-160. (b) legislative history language §§ 209(b) (c)—which obviously focus certain are while recipient employee—and unambiguous covering preemployment Congress used contemporaneous revision bribery conflicts provisions indicate did intend substance predecessor statute eliminated unquestionably required made. 160-164. (c) A serves conflicting policies motivated enactment public recruiting personnel highest quality capacity—since allows corporations qualified make special skills available Government. While policy justifications concerns paymaster will have economic hold over engender bitterness fellow might tend favor former employer—are wholly inapplicable payments, no means directly implicated cases ongoing supplements. 164-168. (d) To extent ambiguity temporal scope remains, rule lenity requires should resolved unless until plainly states intent has misconstrued. P. 168. 845 F.2d 476 (CA4 1988), reversed. STEVENS, J., delivered opinion REHNQUIST, C.J., BRENNAN, WHITE, MARSHALL, BLACKMUN, JJ., joined. SCALIA, concurring judgment, O'CONNOR KENNEDY, joined, post, p. Phillip A. Lacovara No. 88-931. Benjamin S. Sharp, Washington, D.C., Edwin Kneedler, respondent, U.S., cases. Justice STEVENS Court. 1 In 1981 1982, five executives Company, Inc. (Boeing), resigned took early retirement Upon termination Boeing, shortly formation relationship lumpsum amount financial question we decide whether these provision Criminal Code prohibits parties paying, receiving, service.1 2 essential facts disputed. Each planned specific position. These shifts forgoing higher salaries would earned also severing all connection company. Thus, Paisley, Assistant Secretary Navy Research, Engineering Systems—an office confirmation Senate estimated cost him separating approximately $825,000, including $77,000 lost stock options $250,000 benefits.2 Boeing's Paisley amounted $183,000.3 comparable estimate Crandon, computer scientist North Atlantic Treaty Organization, $150,000; $40,000.4 three than Crandon's lower Paisley's.5 paid departing total $485,000.6 3 None payment.7 Moreover, unconditionally. promised return later date nor commitment rehire them. After entering service, none provided favored treatment or, indeed, participated source selection procurement decision affected Boeing. It stipulated competent faithful servants. Apart fact themselves, there charge this case misconduct 4 1986 alleging "to defendant's "created [which] defendant States, 209 and/or common law." App. 12. sought relief aggregate 5 full trial, ruled against several alternative grounds. 653 F.Supp. 1381 (ED Va.1987). First, held Second, violation standard conduct established common-law principles agency disclosed responsible officials "tend subvert defendants government." Id., 1387. Finally, concluded neither appearance actual interest," injured therefore not, event, entitled recover damages. Ibid. 6 divided panel 1988). Court's 480. further prophylactic character laws unnecessary prove injury defendants' disclosure constitute defense action recovery. liable, "although double recovery government permitted." 482.8 7 We granted certiorari review Appeals' construction statute. 490 1003, 109 1636, 104 (1989). 8 * At outset, note express remedy violations 209(a). so many words, argue implicitly remedy. Rather, begins agent secretly profits obligation principal disgorge ill-gotten gains. then replaces definition stricter arguing concealment statutory offense, defense. Regardless Government's amalgamation concepts describes tenable theory recovery, least clear prevail proceed consider applies 9 determining meaning statute, look only particular language, design whole object policy. K Mart Corp. Cartier, Inc., 486 281, 291, 1811, 1818, 100 313 (1988); Pilot Life Ins. Co. Dedeaux, 481 41, 51, 107 1549, 1555, 95 39 (1987). governing set forth criminal appropriate resolving ambit statute's coverage. uncertain, "time-honored interpretive guideline" ensure fair warning boundaries legislatures, courts, define liability. Liparota 471 419, 427, 105 2084, 2089, 85 434 (1985); see Bass, 404 336, 347-348, 92 515, 522-523, 30 488 (1971). II 10 almost dozen addressing bribery, graft, revised compiled Chapter 11 1962. 201-224. some sections bribes offered quid pro quo acts, persons after commencing aims employees' compensation.9 contains prohibitions, first paragraph executive such under circumstances receipt subsection. paragraph—particularly use term employee"—supports Similarly, paragraph's additional "makes to, way supplements of," refer employee." Indeed, since prohibited merely supplement, follows either is, committed Despite awkward drafting paragraphs, thus offense.10 12 rejected reasons. noted prior codification 1962, plain 1914 (1958 ed.) unambiguously limited whoever, "being official employee," salary.11 inferred deletion phrase meant longer need occur during could violate F.2d, felt underlying "§ general support broad interpretation coverage." Because guided warning, rare broader warranted text. case, sources our consistent congressional intent. III 13 enacted 1917 amendment Bureau Education's appropriation "no shall receive services" non-Government source.12 1948, transferred 66 reorganization Title 18.13 As recognized, wording This changed original engendered controversy; entire period between criticism focused instead vagueness reference "in with" service.14 explains narrowing consequence elimination silent eliminating inconsistent view latter broaden section.15 House Judiciary Committees Attorney General maintained substantive law. "Government "officer branch" seemed enhance clarity consistency new statutes.16 14 attach greater significance changes 201 added extending "person selected official," defined nominated appointed official, officially informed appointed."17 203, outside performance expressly covered advance requests offers "rendered . [the recipient] States."18 cover payments; absence pre-existing provision. 15 Further evidence confirming found subsections 209.19 authorizes continue bona fide pension, health, benefit plan employer, types employees. Both addition exemptions like careful draftsmanship Kennedy's 1914. See n. 14, supra. IV 16 appropriately enacts rules prevent even wrongdoing may caused States. rule. Legislation designed prohibit avoid potential governmental supported legitimate maintaining public's confidence integrity service.20 good faith, disclosure, exemplary excuse making payment. nevertheless appropriate, raises questions about prohibition, identify well those counsel too broadly. Offshore Logistics, Tallentire, 477 207, 106 2485, 91 174 (1986). 17 committee Association Bar City New York prepared scholarly report 1960 agree accurately implemented stated: "The really injunction serving masters. Three basic underlie prohibiting payrolls paymasters same job. payor deriving ability cut off lifelines. though direct pressure put do so. And, third, real risks, arrangement generally unwholesome breeds suspicion observers. apt if paying past services, current supposed devoted York, Conflict Interest Service 211 (1960). 19 noteworthy characterized relevant "prohibiting job." rule—the concern employees—apply little application Of course, employer enhanced generous payment, concern, particularly disqualify participating matter involving employer. although 20 An countervailing consideration cannot ignored. President Kennedy recognized 1961 sent message calling wholesale laws: 21 "Such regulation, setting moral standards, impair recruit capacity. Today's needs men women range experience, knowledge, ability. increasing numbers people top-flight talent. hundreds occasional intermittent consultants part-time experts help deal problems complexity technical difficulty. short, draw upon America's reservoir talent skill generation's most business—the business." Message Relative Ethical Conduct H.R. Doc. 145, 87th Cong., 1st Sess., (1961). 22 described statutes books inadequate, others "create[d] obstacles service." 3. 23 commented memorandum 1962 legislation. explaining "main purposes legislation" obtain temporary knowledge whose Government," predicted legislation "lead significant expansion pool departments agencies can needs."21 additions 209(c) allow continuing participation pension benefits plans exempt General's outlook. contrast, encompass run counter interest.22 24 somewhat nebulous character. On hand, correctly argues, give rise possible impropriety certainly allowing identified enacted. function approval disapproval kind statute—which places pre-Government 209(a)—is "harmony what thought spirit purpose act," presents "rare exceptional circumstances" justify departure language. Crooks Harrelson, 282 55, 59-60, 51 49, 50-51, 75 L.Ed. 156 (1930); accord, Rubin 449 424, 430, 101 698, 701, 633 (1981). 25 already observed, construing bound lenity. misconstrued 26 judgment accordingly 27 ordered. 28 whom KENNEDY join, judgment. 29 I failed claim premised fail. My reasons, however, different. think necessarily excluded 209(a); periodically calculated periodic compensation, excluded. Subsection criminally liable: 31 "Whoever receives salary, supplementation branch States[; and] 32 pays, ." 33 clauses "coextensive transaction," ante, 159, "such clause implies requirement well. Surely, implication fairly concludes slipped unusual fashion, importing retroactively into earlier otherwise mirror image preceded. my mind clear; nonexistent. led astray, think, perception "is 'pays' 'any employee,' " ibid.—which leads reasonable enough contention violated. But order verb rendered ungrammatical, "[w]hoever pays subsection." pronoun "its" antecedent (or more precisely, suppose, "under subsection" pays"). seems me quite "pays" be, rather "the "its receipt" refers salary. Substance grammar dictates result, fashion subsection achieve apparent mirroring first. "whoever salary," salary." One expect whoever acknowledge comma of" placed word "supplements." misplaced plausible gross grammatical error, plus destruction apparently parallelism, leading peculiar introduction condition surely find 34 concedes someone "receives States," imply receipt. There imports "pays, supplements, Perhaps pay anoffi cer; contribute (just salary) pertains completed. 35 For different reason, unaddressed present 36 ancient sound should, possible, given effect. needlessly renders words superfluous suspect. treats read States." way. Another ethics statutes, way, compensation" relating matter. compensation," compensation." clause, seen, likewise entirely tied bad ignore (if meaning) statute; where applies. Adamo Wrecking 275, 284-285, 98 566, 572-573, 54 538 (1978). 37 Salary species genus. "[t]he recompense paid, regular intervals .; fixed regularly year, quarter, month, week." Webster's Second International Dictionary 2203 (1957) (emphasis added). Benedict 176 357, 360, 458, 459, 44 503 (1900) ("The 'salary' annual periodical depending rendered"). "receive compensation. And context reasonably sense itself periodic. differently—to regard nongovernment "contribution salary"—is render references superfluous, (like 203) "compensation."1 Office Personnel Management embody regulations, understood mean thinks means, follows: "An anything monetary value (18 209)." CFR 735.203(b) 38 Under version 1917, clearer to" "supplementation envisioned regular, salary-like payments. That part "[N]o person, association, corporation performed Act Mar. 3, Stat. 1106. 40 Even amended left structure substantially same, 41 "Whoever, being 42 corporation, 62 793. 43 versions, interpreted "make(s) supplement(s) include match: guiltless (since salary") whereas liable. intended. ends, prohibition. rely effected recodification, contrary acknowledges—indeed boasts position "firmly established" versions. Nor ratification interpretation. circumstance doubtful basis disregarding unjustified when, discuss Part below, courts primary responsibility administering law, inconsistencies boot. (e) exclude successful giving effect section. exceptions (to "make assurance doubly sure") phenomenon insertion utterly pointless very center restriction. (as below) foolish literally covered, turn out largely May 31, 1961, Memorandum Legal Counsel (OLC) (advising proposed "a clarification existing law" "an exemption" ed.)); Op.Atty.Gen. 273 (1922); 111, 125 (1962). granting remains true exclusively trumps implication, ambiguity—and demands narrow 45 seem strange nowadays categorically criminalizing (salary salary), originally existed time, agency, practice hiring, nominal individuals organizations. Cong.Rec. 2039-2047, 4011-4013; B. Manning, Law 148-149 (1964). Cf. 470 (1919); Comp.Gen. 775 (1923). often acts "one step time" eliminate abuse attention allied abuses, practical reasons why singled out. Surely poses greatest risk corruption; commonly characterizes corrupt saying "he someone's payroll." cannot) without large number harmless, perfectly innocent, desirable, arrangements. example: rare, well-to-do parents periodic, child low-paying job proud performing wish continue. suspect gifts child, leave bequest, precisely end mind. adopted act generosity, accepted objective, seemingly alone, criminalize salary" us understand term. 46 address length strongest argument interpreting says: long differently. analysis, proves weaker suppose. unsatisfactory experience countertextual prime adhering 47 Two points outset: exists judicial 70 years predecessors existence, discussed them, passing, times, Muschany 324 67, 65 442, 451, 89 744 (1945); Myers, 320 561, 567, 64 337, 341, 88 312, 1051 (1944); R. Davidson, 257 506, 179, 182, 341 (1922). Prior litigation, Courts Oberhardt, 887 790, 793-794 (CA7 1989); Raborn, 575 688, 691-692 (CA9 1978); Muntain, 198 U.S.App.D.C. 22, 27-28, 610 964, 969-970 (1979), four Pezzello, 474 462, 463 (ND Tex.1979); Exchange National Bank Chicago Abramson, 295 87, 89-91 (Minn.1969); Gerdel, 103 635, 638-639 Mo.1952); Morse, 292 F. 273, 276-277 (SDNY 1922). Only scarce references, 1952 opinion, explicitly discusses issue versus agreeing here; discussion, moreover, own admission "gratuitous," issue. supra, 638. cases—one Appeals, relatively recent—was (unchallenged) assumption necessary court's holding. supra; sum, long, appreciable, body 48 vast administrative exists—innumerable advisory opinions General, OLC, Ethics, Comptroller counsels various agencies—is deference Chevron U.S.A. Natural Resources Defense Council, 467 837, 2778, 81 694 (1984). law question, administered courts. understandable legal advice regarding interpretation; interpret assure behavior lawful—just innumerable operate lawfully; sort triggers Chevron. Department, determine prosecute; never charged prosecuting deference. 49 Besides unentitled called ex officio Chevron, expansive deserving persuasive Any lawyer advising violates err direction inclusion exclusion—assuming, safe side, apparent. tendency reinforced advice-giver knows takes erroneously prosecute error likely corrected, corrected prosecutions brought. advice-giving normal upside-down, replacing doctrine severity. 50 nonetheless useful purpose: demonstrates beyond unmanageable arise written, record poignant attempts OLC derive results rigid undiscriminating invented. follow logic glimpse behind looking glass. example cash awards nonprofit organizations meritorious Unless believes with") commonlaw bargained-for consideration—which contends—it difficult imagine grants conferred specifically reward work officials. Department approved doing so, June 26, 1959, exemplifies benign unpredictable discretion quotes 1922 obvious point 'object serve masters prejudice unbiased devotion interests States.' (quoting Op.Atty.Gen., 275). continues: "When present, liberally construed situations which, strictly construed, applicable appeared statute." Memorandum, 4. course absurd one's "spirit" violated; measure evil prophylaxis exists. finds award subject "not based 'master-servant' usually attends attend statute," id., 5—a principle far tell, assuredly contexts. reasoning, "[i]n created," ibid., approves Rockefeller Public Awards, grant John D. III.2 52 Later memoranda essentially catch-as-catch-can approach public-service awards, unified mostly extraordinary offended. "[A]n removed it." July 1974, 1. 53 "[Title] future ones. Intent circumstances, prospective duties. "This advised Awards] dual prevent. here. [The payor] non-profit educational institution. Prize one-time-only your achievements you entered government. factor determinative, understanding situation, 209(a)." April 7, 1977, 2-3. 55 objection "we'll - looks dangerous" applied exercise President's discretion-laden power "prescribe regulations branch," 7301. unprecedented 56 areas besides "meritorious awards" unworkability charitably convoluted reasoning. mention two. opined Commerce, dispatched business speech organization, organization reimbursement travel expenses hotel bills bear personally. reasoning 57 "Where, you, concerned personally sources, traveling expenses, Literally said 'contribution to' reality itself, furtherance, prejudice, interests." 275. 58 prevalent 175, amounts induce jobs, (in combination elsewhere. 59 1940 Robert Jackson Roosevelt, universities faculty members Government—not sabbatical program, enable rendering consulting wartime emergency. genuinely devoid gives name ipse dixit respect incidental granted; 'in with' within contemplation 501, 503. "spirit-of-the-matter" necessitated expands ultimately (and predictably) affect proper applications precise equivalent foundations 1917.3 60 last shows, liberties taken appeal concrete for" predecessor, with"). troublesome phrase, temptation something constant meaning. If covers difficulty following part, recipient's as, perform balks applying example, transportation lodging speech, (1922), reduced-price registration fees American meetings, entertainment tickets armed envision. Until accorded enacted, consist (which 201) better handled through Order authority pursuant 7301, Exec. 11222, 306 (1964-1965 Comp.), delegation authority. Operating manner, make, experiment with, sorts distinctions honestly permit—according treatment, privately consists subsistence 100.735-15(d)(1) (1989), 100.735-15(d)(3) (1989); 735.203(e)(3) 61 come, finally, case: here lump sums. room fall existence service—that computed much per month year serve. contingent [sic ] [or] remaining stated time. 1381, 1384 holding transpired "salary, "Salary payable "(a) Whoever independent Columbia, except contributed treasury State, county, municipality; individual, partnership, subsection— "Shall fined $5,000 imprisoned both." (enacted Oct. 23, Pub.L. 87-849, 1(a), 76 1125). Joint Stipulations Uncontested Facts ¶ 27. 476, 478 33; 478. Petitioner Jones, Deputy Strategic Theater Nuclear Forces, requested $176,000 $132,000. Reynolds, consultant Director Space Intelligence Policy, $195,000 $80,000. Kitson, Command, Control, Communications Intelligence, $180,000 $50,000. 25, 26; 29; &Par; 71-72, 31; submitted estimates included reduction accumulated, unvested, company benefits. separate cashed vested internal accounting procedure calculating factors: (1) duration anticipated assumed remainder Presidential term, 65th birthday, whichever shorter; (2) contributions plan; (3) relocation costs; (4) difference living costs Seattle D.C. considered 281-283. staff Kitson Crandon using procedures Reynolds solely procedure. petitioner's component calculation final Final chief executive. limitations barred tort claims Kitson. 481-482. ("Bribery witnesses"); 203 ("Compensation Members Congress, officers, matters affecting Government"). Some payments—and mere offering thereof—thus 203. SCALIA's 169-170, misses point. officer," officer." was: municipality. ed.). arose desire halt organizations, Foundation universities, dollar year. Decrying "activities indulged Education inimical education youth country," Senator Chamberlain Oregon fiscal 1918 appropriations bill: "That Education, connected therewith, money tendered Board corporate associated it, indirectly, municipal agencies; salaries. 2039 (1917). proviso passed, still located section appropriations, contained language: municipality, ch. 163, 1, (1922) (reading uncodified independently). codified 1934 (1934 history, Hearings 1900 al. Antitrust Subcommittee Committee Judiciary, 86th 2d 738-740 (1960) (Memorandum Re: Statutes (1956)). 645, Reviser's Note 66, addition. appears encompassed "[m]inor phraseology." (1946 ed., Supp. IV). See, e.g., H.R.Rep. 748, (1961); 212-216 S.Rep. 2213, (1962); 24-25, U.S.Code Cong. & Admin.News 3852. summary Regarding Provisions Fed.Reg. 988 (1963), reported "uses vary substance." Deletion suggested once 1958, pass. recommended Member Delegate Resident Commissioner, officer, agent, executive, legislative, branch. Legislation, 85th 45, 61, 82 (Comm. Print 1958). Like dropped official" unqualified receives" subject, yet drafters contemplate employed bill inconsistency overlap provisions. containing 208, 209, replaced terms previously 283, 284, uniform Columbia." 41-45. 1119. "included comes 18. 1121. specific, another—(A) Elect, Delegate, Commissioner Elect; (B) 203(a)(1). Those provide: "(b) Nothing herein prevents participate retirement, group life, health accident insurance, profit-sharing, bonus, welfare "(c) contributing supplementing such." 209(b), (c). "directed endangers fabric democratic society, democracy effective faith govern, shattered high appointees engage activities arouse suspicions malfeasance corruption." Mississippi Valley Generating Co., 364 520, 562, 294, 315, 268 985 (1963). reach serious obstacle recruitment age vigorous productive." 158 12, 750 (1956)) ("It problem respecting discourages industry"). interpretation, "salary" unsalaried source. result "salary," supplemented to. (strangely contrived is) completely (c), excludes section's 202, uncompensated officers class obscurely validated compensated manner am aware notes, delicious irony in, sponsor "objected Carnegie Foundations." interesting Awards 155 (1956). gifts, tuition, travel, facilities. hard why, theory, difference. discussion opinions, rational. Consider, following: "Donations are, therefore, prohibited, purchase accommodations. furnished kind, believe justifiable." 268, 270

Classification Label: 7