Court Opinion

ID: 9350522
Source: CourtListenerOpinion
Date Created: 2022-12-27 16:00:32.511649+00
Date Added: 2024-06-11T16:57:36.149751
License: Public Domain

18-2811(L)
     USA v. Blaszczak

 1                              UNITED STATES COURT OF APPEALS

 2                                   FOR THE SECOND CIRCUIT

 3                                                ------

 4                                        August Term, 2020

 5   (Argued: June 9, 2021                                           Decided: December 27, 2022)

 6                           Docket Nos. 18-2811, 18-2825, 18-2867, 18-2878

 7   _________________________________________________________

 8   UNITED STATES OF AMERICA,

 9                                                Appellee,

10                                       - v. -

11   DAVID BLASZCZAK, THEODORE                     HUBER,     ROBERT    OLAN,
12   CHRISTOPHER WORRALL,

13                                       Defendants-Appellants.
14   _________________________________________________________

15   Before: KEARSE, WALKER, and SULLIVAN, Circuit Judges.

16                 Appeals, following vacatur and remand by the United States Supreme Court

17   for further consideration, in light of Kelly v. United States, 140 S. Ct. 1565 (2020), of this

18   Court's prior affirmance of judgments of the United States District Court for the Southern

19   District of New York convicting some or all of the defendants on substantive counts of
 1   conversion of government property in violation of 18 U.S.C. § 641, wire fraud in violation

 2   of 18 U.S.C. § 1343, and securities fraud in violation of 18 U.S.C. § 1348; and convicting

 3   certain of the defendants on various counts of conspiring to engage in conduct violating one

 4   or more of the above sections, all originating from misappropriation of confidential

 5   information from the Centers for Medicare & Medicaid Services ("CMS"), see United States

 6   v. Blaszczak, 947 F.3d 19 (2d Cir. 2019), vacated and remanded, 141 S. Ct. 1040, 2021 WL 78042,

 7   2021 WL 78043 (Jan. 11, 2020). On this remand: (A) defendants contend that their argument

 8   that the CMS information at issue does not constitute "property" or a "thing of value" within

 9   the meaning of the above statutes is supported by the Supreme Court's decision in Kelly;

10   (B) the government, concurring in that contention, confesses error as to the substantive

11   counts and as to a count charging only conspiracy to violate §§ 1343 and 1348 (Count Two);

12   and it agrees that either the defendants' convictions on those counts should be reversed, or

13   the cases should be remanded to the district court so that the government can dismiss those

14   counts pursuant to Fed. R. Crim. P. 48(a); and (C) the government seeks affirmance on the

15   remaining conspiracy counts (Counts One and Seventeen).

16                 Given the Supreme Court's decision in Kelly and the prosecutorial discretion

17   to which the Executive Branch of the government is entitled, we grant the government's

18   request to remand the cases to the district court for dismissal of the substantive counts and

19   Count Two. As to Counts One and Seventeen, the verdicts do not reveal whether the jury

                                                   2
 1   found that the charged defendants conspired to commit offenses as to which the government

 2   has confessed error or instead found that they conspired to engage in other charged criminal

 3   conduct. Accordingly, we vacate the convictions on these two counts and remand for such

 4   further proceedings as may be appropriate.

 5                Remanded for dismissal of the substantive counts and Count Two; vacated and

 6   remanded for further proceedings on Counts One and Seventeen.

 7                Judge Walker joins the majority opinion and concurs in a separate concurring

 8   opinion, in which Judge Kearse joins.

 9                Judge Sullivan dissents, in a separate opinion.

10                       ERIC J. FEIGIN, Deputy Solicitor General, United States
11                            Department of Justice, Washington, D.C. (Elizabeth B.
12                            Prelogar, Acting Solicitor General, United States
13                            Department of Justice, Washington, D.C.; Audrey
14                            Strauss, United States Attorney for the Southern District
15                            of New York, Ian McGinley, Joshua A. Naftalis, Won S.
16                            Shin, Assistant United States Attorneys, New York, New
17                            York, on the brief), for Appellee.

18                       DONALD B. VERRILLI, JR., Washington, D.C. (Elaine J.
19                           Goldenberg, Jonathan S. Meltzer, Dahlia Mignouna,
20                           Jacobus P. van der Ven, Munger, Tolles & Olson,
21                           Washington, D.C., David Esseks, Eugene Ingoglia,
22                           Alexander Bussey, Allen & Overy, New York, New York,
23                           on the brief for Defendant-Appellant Robert Olan; Daniel M.
24                           Sullivan, James M. McGuire, Holwell Shuster &
25                           Goldberg, New York, New York, Stephen Fishbein, John
26                           A. Nathanson, Shearman & Sterling, New York, New
27                           York, on the brief for Defendant-Appellant Christopher

                                                  3
 1          Worrall; Alexandra A.E. Shapiro, Daniel J. O'Neill, Eric S.
 2          Olney, Shapiro Arato Bach, New York, New York, Barry
 3          H. Berke, Dani R. James, Kramer Levin Naftalis &
 4          Frankel, New York, New York, on the brief for Defendant-
 5          Appellant Theodore Huber; Colleen P. Cassidy, Barry D.
 6          Leiwant, Federal Defenders of New York, New York,
 7          New York, on the brief for Defendant-Appellant David
 8          Blaszczak), for Defendants-Appellants.

 9   KATHERINE R. GOLDSTEIN, New York, New York (Akin
10       Gump Strauss Hauer & Feld, New York, New York, on
11       the brief), Court-appointed Amicus Curiae, in support of
12       reinstatement of this Court's decision of affirmance.

13   Peter Neiman, New York, New York (Nicholas Werle, Wilmer
14          Cutler Pickering Hale and Dorr, New York, New York,
15          Jessica Lutkenhaus, Wilmer Cutler Pickering Hale and
16          Dorr, Washington, D.C.; Lindsay A. Lewis, Committee of
17          the National Association of Criminal Defense Lawyers,
18          New York, New York, of counsel), submitted a brief for
19          Amicus Curiae National Association of Criminal Defense
20          Lawyers in support of reversal.

21   Roman Martinez, Washington, D.C. (Michael Clemente, Latham
22        & Watkins, Washington, D.C., Jason M. Ohta, Latham &
23        Watkins, San Diego, California; Stephen R. Cook, Brown
24        Rudnick, Irvine, California, Justin S. Weddle, Weddle
25        Law, New York, New York, of counsel), submitted a brief
26        for Amicus Curiae Jeffrey Wada in support of Defendants-
27        Appellants and reversal.

28   Michael H. McGinley, Philadelphia, Pennsylvania (Michael P.
29        Corcoran, Dechert, Philadelphia, Pennsylvania, of
30        counsel), submitted a brief for Amicus Curiae The Alternative
31        Investment Management Association in support of reversal.

                              4
 1   KEARSE, Circuit Judge:

 2                This appeal returns to us on remand from the United States Supreme

 3   Court for further consideration, in light of Kelly v. United States, 140 S. Ct. 1565 (2020),

 4   of this Court's prior affirmance of judgments of the United States District Court for

 5   the Southern District of New York convicting defendants David Blaszczak, Theodore

 6   Huber, Robert Olan, and Christopher Worrall of conversion of government property

 7   in violation of 18 U.S.C. § 641 and wire fraud in violation of 18 U.S.C. § 1343; and

 8   convicting Blaszczak, Huber, and Olan of securities fraud in violation of 18 U.S.C.

 9   § 1348 ("Title 18 securities fraud"), conspiracy to commit wire fraud and Title 18

10   securities fraud in violation of 18 U.S.C. § 1349, and conspiracies in violation of

11   18 U.S.C. § 371 to, inter alia, convert government property and defraud the United

12   States, all originating from misappropriation of confidential information from the

13   Centers for Medicare & Medicaid Services ("CMS"), see United States v. Blaszczak, 947

14   F.3d 19 (2d Cir. 2019) ("Blaszczak I"), vacated and remanded, 141 S. Ct. 1040, 2021 WL

15   78043 (Jan. 11, 2021). On this remand: (A) defendants contend that their argument

16   that the CMS information at issue does not constitute "property" or a "thing of value"

17   within the meaning of the above statutes is supported by the Supreme Court's decision

18   in Kelly; (B) the government, concurring in that contention, confesses error as to those

19   substantive counts and as to a conspiracy count premised only on crimes concerning

                                                  5
 1   "property" (Count Two); and it agrees that either the defendants' convictions on those

 2   counts should be reversed, or the cases should be remanded to the district court so

 3   that the government can dismiss those counts pursuant to Fed. R. Crim. P. 48(a); and

 4   (C) the government seeks affirmance on the remaining conspiracy counts on which one

 5   or more defendants were convicted (Counts One and Seventeen).

 6                  For the reasons that follow, given the Supreme Court's decision in Kelly

 7   and the prosecutorial discretion to which the Executive Branch of the government is

 8   entitled, we grant the government's request to remand the cases to the district court

 9   for dismissal of the substantive counts and the conspiracy charged in Count Two. As

10   to Counts One and Seventeen, the verdicts do not reveal whether the jury found that

11   the charged defendants conspired to engage in alleged conduct other than that which

12   the government no longer contends was criminal.           Accordingly, we vacate the

13   convictions on these two counts and remand for such further proceedings as may be

14   appropriate.

15                                      I. BACKGROUND

16                  The history of this prosecution, summarized briefly here, is set out in

17   Blaszczak I, 947 F.3d 19, familiarity with which is assumed.

                                                 6
 1                    CMS is an agency within the United States Department of Health and

 2   Human Services. CMS administers Medicare and Medicaid, including inter alia, issuing

 3   rules setting reimbursement rates for healthcare providers. The rules may impact the

 4   stock prices of companies that offer products and services covered by the rates.

 5                    Worrall was an employee at CMS; Blaszczak, a consultant for hedge

 6   funds, was a former CMS employee. Huber and Olan were partners in a hedge fund

 7   ("Deerfield").     At various times between 2009 and 2014, Worrall gave Blaszczak

 8   nonpublic information about the timing and substance of proposed CMS rule changes

 9   that would change reimbursement rates for certain types of medical care for various

10   health conditions.       Blaszczak gave that information to Huber, Olan, or another

11   Deerfield partner, following which Deerfield engaged in profitable short sales of shares

12   of companies that would be negatively affected by reimbursement rate reductions

13   when they became effective.         Between 2010 and 2013, Blaszczak also gave such

14   information to another hedge fund client, following which that fund profitably

15   maintained its short positions and purchased put-options in shares of such companies.

16   A. The Prosecution and the Convictions

17                    With respect to the above activities, defendants were indicted and tried

18   on substantive charges of Title 18 securities fraud in violation of § 1348, securities

                                                   7
 1   fraud in violation of 15 U.S.C. § 78j(b) and 78ff, and 17 C.F.R. § 240.10b-5 (collectively

 2   "Title 15 securities fraud"), wire fraud in violation of 18 U.S.C. § 1343, and conversion

 3   of United States property (i.e., the CMS information) in violation of 18 U.S.C. § 641.

 4   All four defendants were charged with conspiracy, in violation of 18 U.S.C. § 371, to

 5   commit Title 15 securities fraud, to convert government property, and to defraud the

 6   United States (Count One), and conspiracy in violation of 18 U.S.C. § 1349 to commit

 7   wire fraud and Title 18 securities fraud (Count Two). Blaszczak was charged in Count

 8   Seventeen with conspiracy in violation of § 371 to convert government property and

 9   to defraud the United States.

10                The jury acquitted all of the defendants on all substantive counts of Title

11   15 securities fraud.    On the other substantive charges, all four defendants were

12   convicted on at least one count of § 641 property conversion and at least one count

13   of § 1343 wire fraud:    Blaszczak was convicted on a total of three counts of § 641

14   property conversion, two counts of § 1343 wire fraud, and two counts of Title 18

15   securities fraud. Huber and Olan were each convicted on one count of § 641 property

16   conversion, one count of § 1343 wire fraud, and one count of Title 18 securities fraud.

17   Worrall was convicted only on one count of § 641 property conversion and one count

18   of § 1343 wire fraud. As to the conspiracy counts, Blaszczak, Huber, and Olan were

19   convicted on Counts One and Two; Blaszczak was convicted on Count Seventeen.

                                                 8
 1                On appeal, defendants challenged their convictions on the principal

 2   ground that §§ 1343 and 1348 apply to fraudulent schemes to obtain "money or

 3   property" and that § 641 applies to conversion of "money[] or [a] thing of value" of

 4   the government, and that CMS's confidential information as to its plans for announcing

 5   changes in medical service reimbursement rates was not government "property" or a

 6   "thing of value" within the meaning of those statutes.       The majority in Blaszczak I

 7   disagreed, and the convictions were affirmed.

 8   B. The Supreme Court's Decision in Kelly

 9                Following denial of defendants' petitions for rehearing in this Court and

10   a stay of their time to seek further review, defendants petitioned the Supreme Court

11   for certiorari. In the meantime, the Supreme Court had decided Kelly.

12                Kelly   involved   politically   motivated   conduct   by   officials   in   the

13   administration of New Jersey's then-Governor Chris Christie to cause significant traffic

14   gridlock for several days in Fort Lee, New Jersey--terminus of the George Washington

15   Bridge to Manhattan--by reducing the Bridge's toll plaza lanes accessed from Fort Lee

16   from three lanes to one, in retribution for the refusal of Fort Lee's mayor to endorse

17   Christie's bid for reelection. The plan was executed under the guise of a traffic study;

18   its exposure as a sham led to the officials' criminal prosecution.

                                                   9
 1                The officials were charged with wire fraud in violation of 18 U.S.C.

 2   § 1343 (which prohibits schemes "for obtaining money or property"), fraud on a

 3   federally funded entity (i.e., the Port Authority, which administered the Bridge) in

 4   violation of 18 U.S.C. § 666(a)(1)(A) (which prohibits fraudulently "obtain[ing] . . .

 5   property" from such an entity), and conspiracy to commit those crimes.            After the

 6   defendants were convicted and their convictions were affirmed on appeal, the Supreme

 7   Court reversed.

 8                The Court held that the defendants' conduct did not fall within the scope

 9   of § 1343 or § 666(a)(1)(A) because their scheme did not aim to deprive the Port

10   Authority of money or property. The Court noted that the federal fraud statutes are

11   "limited in scope to the protection of property rights," Kelly, 140 S. Ct. at 1571 (internal

12   quotation marks omitted), and do not "criminaliz[e] all acts of dishonesty," id. Thus,

13   the government was required to prove, inter alia, that the object of the defendants'

14   fraud was money or property, see id. at 1571-72. Instead, the Court concluded, the

15   Kelly defendants, by deciding the distribution of lanes for drivers on the toll road, had

16   exercised the government's regulatory rights of "'allocation, exclusion, and control.'"

17   Id. at 1573 (quoting Cleveland v. United States, 531 U.S. 12, 23 (2000)). The Court stated

18   that such regulatory rights "do 'not create a property interest,'" Kelly, 140 S. Ct. at 1573

                                                 10
 1   (quoting Cleveland, 531 U.S. at 23), and thus, "a scheme to alter such a regulatory

 2   choice is not one to appropriate the government's property," Kelly, 140 S. Ct. at 1572.

 3                  The Court rejected the government's arguments that the property aspect

 4   of § 1343 and § 666(a)(1)(A) was satisfied either because the physical lanes that the

 5   defendants "'commandeer[ed]'" were government property, id., or because their project

 6   required expenditures of time and labor by Port Authority employees. The Court held

 7   that for conduct to be within those statutes, property must be more than an incidental

 8   aspect of the fraud; it "must be an 'object of the fraud.'"        Id. at 1573 (quoting

 9   Pasquantino v. United States, 544 U.S. 349, 355 (2005)). As the object of the defendants'

10   scheme was clearly to alter "a regulatory decision about the toll plaza's use" for

11   political retaliation, rather than to take the lanes from the government or to convert

12   them to non-public use, the lanes as property played no more than a "bit part in [the]

13   scheme."      Kelly, 140 S. Ct. at 1573.   Similarly, in contrast to a misuse of public

14   employees to renovate an official's home, the defendants merely altered a regulation;

15   "[e]very regulatory decision" involves some employee labor, and that expended by the

16   Port Authority employees was "only an incidental byproduct of the scheme."            Id.

17   at 1573-74.

                                                 11
 1   C. The Parties' Positions on Remand in Light of Kelly

 2                  In the present case, defendants successfully petitioned for certiorari, with

 3   some support from the government: "At the request of the Acting Solicitor General,

 4   the Supreme Court granted the petitions" of defendants for certiorari, "vacated this

 5   Court's judgment, and remanded the case for further consideration in light of Kelly."

 6   (Government brief on remand at 2.)

 7                  Defendants on this remand renew their principal contention that the CMS

 8   information at issue does not constitute "property" or a "thing of value" within the

 9   meaning of the fraud and conversion statutes, and they contend that that conclusion

10   is supported by the Supreme Court's decision in Kelly. Their opening brief on remand

11   urges that all of their convictions be reversed.

12                  The government on remand, insofar as the substantive counts of

13   conviction are concerned, agrees with defendants that those counts cannot stand. It

14   states that,

15                         [i]n light of the Supreme Court's holding in Kelly, it is now
16                  the position of the Department of Justice that in a case involving
17                  confidential government information, that information typically
18                  must have economic value in the hands of the relevant
19                  government entity to constitute "property" for purposes of
20                  18 U.S.C. §§ 1343 and 1348. . . . A related, though not necessarily
21                  identical, analysis applies when determining what confidential
22                  information is a "thing of value" under 18 U.S.C. § 641. The
23                  Department has determined that the confidential information at
24                  issue in this case does not constitute "property" or a "thing of

                                                  12
 1                  value" under the relevant statutes after Kelly. To be sure, this
 2                  Court recognized that "CMS does have an economic interest in its
 3                  confidential predecisional information" because the agency "invests
 4                  time and resources into generating and maintaining the
 5                  confidentiality of" that information, and leaks affect the "efficient
 6                  use of its limited time and resources." Blaszczak[ I ], 947 F.3d
 7                  at 33. But in the Department's view, shaped by Kelly, the CMS
 8                  employee time at issue in this case did not constitute "an object of
 9                  the fraud," and thus the associated "labor costs could not sustain
10                  the conviction[s]" here. Kelly, 140 S. Ct. at 1573.

11   (Government brief on remand at 7-8 (emphasis in brief).)               "Accordingly," the

12   government states, "this Office is constrained to confess error at the direction of the

13   Solicitor General's Office" (id. at 8; see also id. at 2 ("This brief was prepared in

14   consultation with the Office of the Solicitor General to reflect the Department of

15   Justice's post-Kelly position on the scope of 'property' under 18 U.S.C. §§ 1343 and

16   1348, and a 'thing of value' under 18 U.S.C. § 641, which this Office is constrained to

17   follow.")).   The government urges that we either "reverse . . . the convictions" for

18   conversion of United States property (Counts Three, Thirteen, and Eighteen), wire

19   fraud (Counts Nine and Fifteen), Title 18 securities fraud (Counts Ten and Sixteen),

20   and conspiracy to commit wire fraud and Title 18 securities fraud (Count Two)

21   (Government brief on remand at 8-9), or that we remand the matter to the district

22   court in order to permit the government to have those eight counts dismissed

23   pursuant to Federal Rule of Criminal Procedure 48(a) (Government response to brief

24   of Court-appointed amicus curiae at 8).

                                                 13
 1                The government argues, however, that the conspiracy convictions on

 2   Counts One and Seventeen should be affirmed.           Count One, on which Blaszczak,

 3   Huber, and Olan were convicted, alleged that defendants' objectives were not only to

 4   convert government property in violation of § 641, but also to commit Title 15

 5   securities fraud and to defraud the United States in violation of 18 U.S.C. § 371. And

 6   Count Seventeen, alleged only against Blaszczak, alleged that his objectives were both

 7   conversion of government property and defrauding the United States. The government

 8   acknowledges that "[i]n light of [its] confession of error, . . . the Government is

 9   constrained to concede that the § 641 objects are legally invalid," but it argues that

10   "the § 371 defraud-clause objects were not affected by Kelly and remain legally valid."

11   (Government brief on remand at 10.) The government also concedes that the jury's

12   "general verdict[s]" on Counts One and Seventeen, and "the presence of both legally

13   invalid and legally valid objects gives rise to error" (id. (citing Yates v. United States,

14   354 U.S. 298 (1957))).   However, it argues that the error is harmless in light of the

15   "overwhelming evidence" that Blaszczak conspired with Huber and Olan (the Deerfield

16   partners) to defraud the United States in connection with Deerfield's stock trading

17   (Count One), and that Blaszczak conspired with another client to defraud the United

18   States in connection with that client's stock trading (Count Seventeen).

                                                 14
 1                In reply, defendants concur in the government's proposal to have the

 2   substantive counts and Count Two dismissed. Blaszczak, Huber, and Olan, in reply

 3   to the government's contention that their conviction(s) on Counts One and Seventeen

 4   should be affirmed, dispute the government's contention that any lack of clarity as to

 5   the basis of the jury verdicts on these counts was harmless.       They argue that it is

 6   instead likely that the jury based its conspiracy verdicts on the § 641 allegations, given

 7   that the government ended its rebuttal summation by urging "the jury to 'take the jury

 8   form and mark guilty on Count One, because that is a conspiracy to steal government

 9   information.'" (Defendants' reply brief on remand at 13 (quoting trial transcript

10   (emphasis in brief)).) They argue that the convictions on Counts One and Seventeen,

11   if not reversed, must at least be vacated.

12                                       II. DISCUSSION

13                For the reasons that follow, given the Supreme Court's decision in Kelly

14   and the prosecutorial discretion to which the Executive Branch of the government is

15   entitled, we grant the government's request to remand these cases to the district court

16   for dismissal of the seven substantive counts of conviction and the conspiracy

17   conviction in Count Two.      In light of the lack of clarity as to whether the jury's

                                                  15
 1   verdicts of guilt on Counts One and Seventeen were based on findings of conspiracy

 2   to violate § 641 or instead on conspiracy to defraud the government in violation of

 3   § 371 (or in Count One on conspiracy to commit Title 15 securities fraud), we vacate

 4   the judgments on Counts One and Seventeen and remand for such further proceedings

 5   on these counts as may be appropriate.

 6   A. The Government's Confession of Error in Light of Kelly

 7                 "[O]ne of the core powers of the Executive Branch of the Federal

 8   Government [is] the power to prosecute." United States v. Armstrong, 517 U.S. 456, 467

 9   (1996).   "'[S]ubject to constitutional constraints,'" id. at 464 (quoting United States v.

10   Batchelder, 442 U.S. 114, 125 (1979)), such as prohibitions against invidious

11   discrimination, see generally Armstrong, 517 U.S. at 464-65, or vindictive prosecution, see

12   generally United States v. Goodwin, 457 U.S. 368, 373-74 (1982), the United States

13   "Attorney General and United States Attorneys retain 'broad discretion' to enforce the

14   Nation's criminal laws," Armstrong, 517 U.S. at 464 (quoting Wayte v. United States, 470

15   U.S. 598, 607 (1985) (other internal quotation marks omitted)).

16                 In the ordinary case, "so long as the prosecutor has probable cause
17                 to believe that the accused committed an offense defined by
18                 statute, the decision whether or not to prosecute, and what charge
19                 to file or bring before a grand jury, generally rests entirely in his
20                 discretion."

                                                 16
 1   Armstrong, 517 U.S. at 464 (quoting Bordenkircher v. Hayes, 434 U.S. 357, 364 (1978)

 2   (emphasis ours)).

 3                This broad discretion rests largely on the recognition that the
 4                decision to prosecute is particularly ill-suited to judicial review.
 5                Such factors as the strength of the case, the prosecution's general
 6                deterrence value, the Government's enforcement priorities, and the
 7                case's relationship to the Government's overall enforcement plan
 8                are not readily susceptible to the kind of analysis the courts are
 9                competent to undertake.

10   Wayte, 470 U.S. at 607; see also United States v. Knox, 32 F.3d 733, 739 n.3 (3d Cir. 1994)

11   ("[A] prosecutor always has broad discretion to decide the circumstances that warrant

12   prosecution of a person for what the prosecutor fairly believes is unlawful conduct.

13   When the prosecutor decides to prosecute, . . . it is the exclusive function of the

14   judiciary to determine whether the conduct charged is unlawful unless the prosecutor

15   then withdraws the prosecution." (emphasis added)).

16                The Federal Rules of Criminal Procedure provide, as pertinent here, that

17   "[t]he government may, with leave of court, dismiss an indictment . . . ."         Fed. R.

18   Crim. P. 48(a).

19                The principal object of the "leave of court" requirement is
20                apparently to protect a defendant against prosecutorial harassment,
21                e.g., charging, dismissing, and recharging, when the Government
22                moves to dismiss an indictment over the defendant's objection. . . .
23                But the Rule has also been held to permit the court to deny a
24                Government dismissal motion to which the defendant has
25                consented if the motion is prompted by considerations clearly
26                contrary to the public interest.

                                                 17
 1   Rinaldi v. United States, 434 U.S. 22, 29-30 n.15 (1977) (emphasis added); see generally

 2   United States v. Cowan, 524 F.2d 504, 509-11 (5th Cir. 1975) ("Cowan") (the "leave of

 3   court" requirement was added by the Supreme Court to the originally proposed

 4   version of Rule 48(a), which had required the government merely to give a statement

 5   of its reasons for dismissing a prosecution), cert. denied sub nom. Woodruff v. United

 6   States, 425 U.S. 971 (1976).

 7                The government may elect to eschew or discontinue prosecutions for any

 8   of a number of reasons.        Rarely will the judiciary overrule the Executive Branch's

 9   exercise of these prosecutorial decisions. For example, in Petite v. United States, 361

10   U.S. 529 (1960), the government, while not opposing the defendant's certiorari petition

11   challenging his prosecution and conviction on the ground of double jeopardy, informed

12   the Supreme Court that the Department of Justice ("Department" or "Justice

13   Department"), "wholly apart from the question of the legal validity of the claim of

14   double jeopardy," was considering whether the second prosecution of the defendant

15   was consistent with Department policy for the control of government litigation. Id.

16   at 530. Thereafter, the Solicitor General having announced a general policy against

17   multiple prosecutions arising out of a single transaction or against a federal

18   prosecution that would be duplicative of a state prosecution, see id. at 530-31, the

19   government moved for, and the Supreme Court granted, a "remand[] to the Court of

                                                  18
 1   Appeals to vacate its judgment [of affirmance] and to direct the District Court to

 2   vacate its judgment [of conviction] and to dismiss the indictment," id. at 531.

 3                Even when a defendant has been tried, convicted, and sentenced in a

 4   prosecution that, under the Petite policy, would not have been brought if the Justice

 5   Department's internal procedures had been properly or timely followed, the courts

 6   have granted the government's eventual motion to vacate the conviction and have the

 7   indictment dismissed. See, e.g., Rinaldi, 434 U.S. at 23, 29-30; United States v. Houltin,

 8   553 F.2d 991, 991-92 (5th Cir. 1977).

 9                In Gaona-Romero v. Gonzales, 497 F.3d 694 (5th Cir. 2007), a government

10   motion seeking termination of a proceeding reflected a change in a different Justice

11   Department policy.    The government moved to vacate a court of appeals decision

12   upholding the removal of an alien who had been convicted of a controlled substances

13   offense, but whose conviction had been vacated. The government reviewed its policy

14   with regard to such cases, and decided to follow a revised Board of Immigration

15   Appeals ("BIA") interpretation of "conviction," see 8 U.S.C. § 1101(a)(48)(A), to exclude

16   convictions that were vacated on the basis of procedural or substantive error.        The

17   court of appeals granted the motion and "remand[ed] to the BIA so that the

18   government may follow through on its pledge to withdraw the charge of

19   removability." Id. at 695.

                                                19
 1                In cases in which the government itself has come to the view that a given

 2   defendant may not have been guilty of the crime of which he was convicted, the

 3   government has similarly moved to discontinue or dismiss the prosecution.            For

 4   example, in United States v. Weber, 721 F.2d 266 (9th Cir. 1983), after Weber and his

 5   codefendants had been convicted and sentenced, the Assistant United States Attorney

 6   who had prosecuted the case interviewed Weber, received new information, and

 7   reexamined the evidence. As a result he "develop[ed] a serious and substantial doubt

 8   as to Weber's guilt," id. at 268, and the government moved under Rule 48(a) to

 9   dismiss the indictment against Weber. The district court, while stating that it had "no

10   doubt" as to the prosecutor's "good faith doubt regarding Weber's guilt," id., denied

11   the motion, apparently believing such a motion could not be granted after the

12   defendant had been convicted, see id. at 269.

13                The court of appeals reversed, holding that "[s]eeking dismissal because

14   of the existence of such a reasonable doubt" as to the defendant's guilt is "not clearly

15   contrary to the manifest public interest." Id. (internal quotation marks omitted); see

16   also United States v. DiMattina, 571 F. App'x 50, 50 (2d Cir. 2014) ("Defendant Frank

17   DiMattina argues that his conviction for extortion is invalid because he did not 'obtain'

18   any property for purposes of the Hobbs Act. The Government, in its brief on appeal,

19   agrees and concedes that the judgment must be vacated in all respects.               The

                                                20
 1   Government now seeks remand to the District Court 'so that [it] can move to dismiss

 2   the indictment with prejudice under Rule 48(a) of the Federal Rules of Criminal

 3   Procedure.' Appellee Br. 11. We agree that is the appropriate course of action.").

 4                In United States v. Smith, 55 F.3d 157 (4th Cir. 1995) ("Smith"), Smith, who

 5   had originally pleaded not guilty and was being tried with four codefendants, decided

 6   mid-trial to plead guilty and agreed to testify against his codefendants. He testified

 7   truthfully, but the codefendants were acquitted. The government then moved under

 8   Rule 48(a) to dismiss the indictment against Smith, stating two reasons.

 9                First, [it] pointed to the acquittal of Smith's four codefendants and
10                expressed the opinion that if Smith had not pleaded guilty, he,
11                too, certainly would have been acquitted. Second, the United
12                States Attorney pointed out that after pleading guilty Smith
13                cooperated with the government and testified truthfully. The
14                United States Attorney emphasized that dismissal promoted
15                credibility in future attempts to enlist defendants to plead guilty,
16                cooperate with the government, and truthfully testify in return for
17                lenient treatment.       He summed up his reasons as follows:
18                "Obviously, it is not only in the public interest to do what is fair
19                and right, but it is also in the public's interest to encourage
20                persons with knowledge to cooperate with the United States."

21   Id. at 160. The district court, however, while finding no bad faith on the part of the

22   United States Attorney, denied the motion, based on the court's "own assessment" that

23   it "would be clearly contrary to [the] manifest public interest" to dismiss the

24   indictment against Smith given that "Smith's guilty plea and corroborating testimony

25   constituted substantial evidence of his guilt." Id.

                                                21
 1                The court of appeals reversed. While noting that the district court's own

 2   decision was reviewable for abuse of discretion, it pointed out that the exercise of

 3   judicial discretion in this regard must respect the prosecutorial discretion conferred on

 4   the Executive Branch:

 5                The court's discretion must be exercised in conformity with Rule
 6                48(a) and the construction that the Supreme Court has placed on
 7                the rule. Because the discretion granted by Rule 48(a) involves the
 8                constitutional issue of the Separation of Powers Doctrine, a
 9                reviewing court must carefully scrutinize the district court's action.
10                In Newman v. United States, 382 F.2d 479, 480 (D.C.Cir. 1967), Chief
11                Justice Burger, then a circuit judge, wrote: "Few subjects are less
12                adapted to judicial review than the exercise by the Executive of his
13                discretion in deciding when and whether to institute criminal
14                proceedings, or what precise charge shall be made, or whether to
15                dismiss a proceeding once brought."

16   Smith, 55 F.3d at 158.

17                "Rule [48(a)] was not promulgated to shift absolute power from
18                the Executive to the Judicial Branch. Rather, it was intended as
19                a power to check power. The Executive remains the absolute
20                judge of whether a prosecution should be initiated and the first
21                and presumptively the best judge of whether a pending
22                prosecution should be terminated. The exercise of its discretion
23                with respect to the termination of pending prosecutions should not
24                be judicially disturbed unless clearly contrary to manifest public
25                interest. In this way, the essential function of each branch is
26                synchronized to achieve a balance that serves both practical and
27                constitutional values."

28   Smith, 55 F.3d at 158-59 (quoting Cowan, 524 F.2d at 513).

                                                22
 1                       The disposition of a government's motion to dismiss an
 2                indictment should be decided by determining whether the prosecutor acted
 3                in good faith at the time he moved for dismissal. A motion that is not
 4                motivated by bad faith is not clearly contrary to manifest public interest,
 5                and it must be granted. . . . [T]he trial court has little discretion in
 6                considering a government motion to dismiss made pursuant to
 7                Federal Rule of Criminal Procedure 48(a). It must grant the motion
 8                absent a finding of bad faith or disservice to the public interest. . . .
 9                The disservice to the public interest must be found, if at all, in the
10                motive of the prosecutor. Examples of disservice to the public
11                interest include the prosecutor's acceptance of a bribe, personal
12                dislike of the victim, and dissatisfaction with the jury impaneled.

13   Smith, 55 F.3d at 159 (internal quotation marks omitted (emphases ours)); see, e.g.,

14   Rinaldi, 434 US. at 30 (regardless of the government's reasons for initiating or

15   maintaining a prosecution, the "salient issue" as to its later decision to terminate it is

16   whether the request to dismiss the indictment is "tainted with impropriety").

17                The Smith court of appeals reversed the denial of the government's Rule

18   48(a) motion, concluding that the district court's "own assessment of the public

19   interest" and "[w]eighing [of] these interests d[id] not give adequate recognition to the

20   Executive in the context of the Separation of Powers Doctrine as it exercises its duty

21   in good faith to take care that the laws are faithfully executed." 55 F.3d at 160.

22                In United States v. Fokker Services, B.V., 818 F.3d 733 (D.C. Cir. 2016)

23   ("Fokker"), the government had entered into a deferred prosecution agreement ("DPA")

24   with a defendant and had agreed not to prosecute certain persons. The district court

25   regarded the DPA as an inappropriately "anemic[]" response to "egregious conduct"

                                                  23
 1   over "a sustained period of time and for the benefit of one of our country's worst

 2   enemies," and it refused to exclude DPA cooperation time from the speedy trial clock

 3   as authorized by the Speedy Trial Act ("Act").          The court of appeals granted the

 4   government's petition for mandamus:

 5                [T]he Act confers no authority in a court to withhold exclusion of
 6                time pursuant to a DPA based on concerns that the government
 7                should bring different charges or should charge different
 8                defendants. Congress, in providing for courts to approve the
 9                exclusion of time pursuant to a DPA, acted against the backdrop
10                of long-settled understandings about the independence of the
11                Executive with regard to charging decisions. Nothing in the
12                statute's terms or structure suggests any intention to subvert those
13                constitutionally rooted principles so as to enable the Judiciary to
14                second-guess the Executive's exercise of discretion over the initiation and
15                dismissal of criminal charges.

16   Id. at 738 (emphasis added).

17                Finally, close to home, this Court honored the government's decision in

18   light of Kelly to end its pursuit of a § 641 prosecution in United States v. Aytes, No.

19   19-3981, Dkt. No. 70 (2d Cir. Apr. 13, 2021) ("Aytes"). Aytes, after a jury trial in 2018,

20   was found guilty of theft of government property in violation of § 641 for her

21   unauthorized taking from the Federal Deposit Insurance Corporation ("FDIC") of paper

22   and electronic copies of documents that detailed plans, in the event of a severe

23   financial crisis, for the rapid and orderly liquidation of four banks regulated by the

24   FDIC. Aytes successfully moved pursuant to Federal Rule of Criminal Procedure 29

                                                  24
 1   for a judgment of acquittal, see United States v. Aytes, No. 18 CR 132, 2019 WL 5579485

 2   (E.D.N.Y. Oct. 29, 2019); the government, with the approval of the Solicitor General,

 3   appealed. While Aytes's appeal was pending, the Supreme Court decided Kelly and

 4   granted certiorari in the present cases for reconsideration in light of Kelly; and the

 5   government in the present cases, upon instructions from the Solicitor General,

 6   confessed error and requested reversal of the convictions of--or dismissal of the

 7   indictment counts against--the present defendants on the § 641-related and other

 8   property-related counts.

 9                 The United States Attorney's Office that prosecuted Aytes, upon conferring

10   with the Solicitor General, was instructed that the § 641 charges against her were not

11   meaningfully distinguishable from the property-related charges in the present cases and

12   that the government should move to dismiss its appeal from Aytes's judgment of

13   acquittal.   See Aytes, No. 19-3981, Dkt. No. 65 (government motion, Apr. 12, 2021).

14   Accordingly, the government so moved; and this Court summarily granted the

15   government's motion and its appeal was dismissed, thereby ending pursuit against

16   Aytes of charges for theft of government regulatory information under § 641, see Aytes,

17   No. 19-3981, Dkt. No. 70 (order of dismissal, Apr. 13, 2021).

                                                25
 1                With these considerations in mind, we conclude that the government's

 2   decision to seek the dismissal of the seven substantive counts convicting defendants

 3   under §§ 1343, 1348, and 641, along with the conspiracy charges in Count 2, is

 4   appropriate and owed deference.         Nonetheless, we are also mindful that the

 5   government's confession of error "does not automatically govern an appellate court's

 6   disposition of an appeal."    United States v. Vasquez, 85 F.3d 59, 60 (2d Cir. 1996)

 7   (collecting cases); see also Young v. United States, 315 U.S. 257 (1942).

 8                In Young--a 1942 case arising prior to the adoption of Rule 48(a) with

 9   respect to the government's desire to dismiss a prosecution--a physician convicted of

10   failing to maintain records required by the Harrison Narcotics Act, 26 U.S.C. §§ 2551(a)

11   and (b), contended that his conduct fell beyond the record-keeping requirement. The

12   government confessed error, and requested reversal and remand to the district court

13   with direction to dismiss that count of the indictment. The Supreme Court declined

14   to reverse without considering the merits:

15                       The public trust reposed in the law enforcement officers of
16                the Government requires that they be quick to confess error when,
17                in their opinion, a miscarriage of justice may result from their
18                remaining silent. But such a confession does not relieve this Court
19                of the performance of the judicial function. The considered
20                judgment of the law enforcement officers that reversible error has
21                been committed is entitled to great weight, but our judicial
22                obligations compel us to examine independently the errors
23                confessed. See Parlton v. United States, 64 App.D.C. 169, 75 F.2d
24                772. The public interest that a result be reached which promotes

                                                 26
 1                a well-ordered society is foremost in every criminal proceeding.
 2                That interest is entrusted to our consideration and protection as
 3                well as that of the enforcing officers. Furthermore, our judgments
 4                are precedents, and the proper administration of the criminal law
 5                cannot be left merely to the stipulation of parties.

 6   Young, 315 U.S. at 258-59.

 7                To the extent that this Court is required to address the merits of the

 8   convictions on the counts as to which the government confesses error and/or requests

 9   a remand for dismissal, see generally Young, we conclude that in light of Kelly, §§ 1343,

10   1348, and 641 do not apply to the conduct that was at issue here.

11   B.    The Confidential Information and the Timing of Agency Action Are Not CMS's
12         "Property"

13                As indicated in Part I.B. above, the Kelly Court noted that the relevant

14   federal fraud statutes such as § 1343 are "limited in scope to the protection of

15   property rights" and do not "criminaliz[e] all acts of dishonesty," and that the

16   government therefore was required to prove, inter alia, that the object of the

17   defendants' fraudulent scheme was money or property, Kelly, 140 S. Ct. at 1571-72

18   (internal quotation marks omitted). Kelly held that the defendants' conduct affecting

19   the operation of the Port Authority did not fall within the scope of § 1343 or

20   § 666(a)(1)(A) because "[t]he wire fraud statute thus prohibits only deceptive "'schemes

21   to deprive [the victim of] money or property.'" 140 S. Ct. at 1571 (quoting McNally v.

                                                27
 1   United States, 483 U.S. 350, 356 (1987)) (brackets in Kelly; emphasis ours); see, e.g.,

 2   Cleveland, 531 U.S. at 15 ("the thing obtained must be property in the hands of the

 3   victim"); and the objective of the Kelly defendants' scheme was neither to deprive the

 4   Port Authority of its money or property nor to utilize for defendants' own purposes

 5   that agency's employees' paid time, but rather to reallocate the Bridge's access lanes.

 6   Kelly concluded that "a scheme to alter such a regulatory choice is not one to

 7   appropriate the government's property," Kelly, 140 S. Ct. at 1572 (emphasis added).

 8                In the present case the same is true with respect to the counts charging

 9   various defendants with fraud in violation of §§ 1343 and 1348 or with conversion of

10   government property in violation of § 641.      In contrast, as to the counts of the

11   indictment that charged violations of the Title 15 securities laws, the actual and

12   intended victims of the alleged frauds would have been investors in the market for

13   securities of the companies whose fortunes would be affected by the regulations

14   promulgated by CMS. Indeed, as noted by the Court-appointed amicus curiae, "[a]t

15   its core, this was a case about insider trading--an act already understood to be

16   wrongful under [Title 15]." (Brief of Court-appointed amicus curiae at 19.) But the

17   jury acquitted defendants on all of those Title 15 substantive counts; and in the

18   remaining substantive counts at issue here, on which the jury convicted--the fraud

                                               28
 1   sections, §§ 1343 and 1348, and the section prohibiting "conver[sion]" of "money," or

 2   a "thing of value" from "the United States or any department or agency thereof,"

 3   18 U.S.C. § 641--the purported victim would have been the government agency CMS.

 4   Thus, defendants could not properly be convicted of violating §§ 1343, 1348, or 641

 5   unless the objective of their schemes and conduct was money or property of CMS.

 6                The Supreme Court in Kelly noted that it had previously established that

 7   a government agency's "exercise of regulatory power . . . fails to meet the [federal

 8   fraud] statutes' property requirement."    140 S. Ct. at 1568-69; see id. at 1572 (with

 9   regard to "a deceptive scheme to influence, to his own benefit, [a governmental

10   entity's] issuance of gaming licenses," "this Court has already held that a scheme to

11   alter such a regulatory choice is not one to appropriate the government's property"

12   (citing Cleveland, 531 U.S. at 23) (emphasis added)). No greater property interest was

13   involved in the CMS information at issue in the present case.

14                While confidential information may constitute property of a commercial

15   entity such as the publisher victim in Carpenter v. United States, 484 U.S. 19 (1987)--for

16   which confidential information was its "stock in trade, to be gathered at the cost of

17   enterprise, organization, skill, labor, and money, and to be distributed and sold to those

18   who [would] pay money for it," id. at 26 (internal quotation marks omitted; emphasis

                                                29
 1   ours)--the same is not true with respect to a regulatory agency such as CMS. CMS

 2   is not a commercial entity; it does not sell, or offer for sale, a service or a product.

 3                CMS adopts regulations that affect, inter alia, business organizations or

 4   health industry entities, whether the affected persons or entities favor the regulations

 5   or not. And while CMS seeks to maintain confidentiality as to its planned regulations-

 6   -and the regulations can plainly have either a favorable or an adverse effect on certain

 7   business entities' fortunes--a planned CMS regulation, even if disclosed to outsiders

 8   prematurely, remains within the exclusive control of CMS. And if it is prematurely

 9   disclosed to others, the disclosure has no direct impact on the government's fisc,

10   although it might well impact CMS's subsequent regulatory choices. CMS can adhere

11   to its planned regulation, or it can alter or abandon it; it can publish the regulation

12   at the time it had planned, or it can postpone or advance the announcement or the

13   regulation's effective date.   As the Supreme Court recognized in Cleveland and

14   emphasized in Kelly, the government's right to determine "who should get a benefit

15   and who should not . . . do[es] 'not create a property interest.'" Kelly, 140 S. Ct.

16   at 1572 (quoting Cleveland, 531 U.S. at 23)). The information reflecting such a decision

17   and the timing of that disclosure are regulatory in character and do not constitute

18   money or property of the victim; and they are not a "thing of value" to CMS that is

19   susceptible to being "convert[ed]," 18 U.S.C. § 641.

                                                30
 1                 We disagree with the dissent's contention that the present decision

 2   conflicts with this Court's precedent in United States v. Girard, 601 F.2d 69 (2d Cir.

 3   1979). That case involved a drug dealer's attempt to purchase confidential records of

 4   the United States Drug Enforcement Administration ("DEA") as to what persons were

 5   DEA informants in certain DEA investigations.        We ruled that such confidential

 6   information was a "thing of value" to the DEA within the meaning of § 641. See 601

 7   F.2d at 71.   And logically so:   Such information has inherent value to the DEA in

 8   investigations and preparation for prosecutions; its theft would interfere with those

 9   operations, by allowing the targets of investigations to, for example, better conceal

10   their criminal conduct, hide their contraband, or flee from arrest, as well as by

11   imperiling the well-being of the undercover agents and confidential informants used

12   in those operations. We cannot agree that such inherently valuable law enforcement

13   information is comparable to the regulatory information at issue in the present case,

14   which was the reimbursement rates that CMS would announce for certain health

15   services and the planned dates of the announcements.

16                 In sum, in Kelly, the scheme sought to alter the agency's exercise of its

17   regulatory power. In the present case, the goal of the conduct at issue was a step

18   removed from any attempt at alteration; defendants instead schemed to obtain and

19   promptly utilize advance information as to how the regulatory power would be

                                               31
 1   exercised by CMS. As the conduct in Kelly--altering a regulation--does not constitute

 2   a deprivation of government property, a fortiori merely obtaining advance information

 3   as to what the agency's preferred regulation would be, and when it would be

 4   announced, cannot properly be considered the agency's money or property or a thing

 5   of value that could be "convert[ed]."

 6                We respect the Executive's "decisions about whether to initiate charges,

 7   whom to prosecute, which charges to bring, and whether to dismiss charges once brought."

 8   Fokker, 818 F.3d at 737 (emphases added). The jury found defendants not guilty on

 9   any of the substantive counts alleging Title 15 securities fraud--the core of the case.

10   The government's election, in light of Kelly, not to pursue the case further as one for

11   conversion of, or fraud to obtain, government "property" is entitled to deference. And

12   our independent review confirms that the dismissals requested by the government are

13   required following Kelly.   Accordingly, these cases will be remanded to the district

14   court for dismissal of the substantive counts and the Count Two conspiracy charges.

15   C. The Remaining Conspiracy Counts

16                The only remaining counts of the indictment are Count One, on which

17   Blaszczak, Huber, and Olan were convicted of conspiring, in violation of 18 U.S.C.

18   § 371, to convert property belonging to the United States in violation of 18 U.S.C.

                                               32
 1   § 641, to commit Title 15 securities fraud, and to defraud the United States in

 2   violation of § 371; and Count Seventeen, on which Blaszczak was convicted of

 3   conspiring, in violation of 18 U.S.C. § 371, to violate § 641 and to defraud the United

 4   States.

 5                As to these counts, the jury was not given questions to answer that

 6   would reveal which one or more of the alleged conspiratorial goals it found proven.

 7   And since the government has confessed error as to charges that defendants' conduct

 8   was within the scope of § 641, and it no longer seeks to sustain these conspiracy

 9   convictions on the basis of § 641 property-conversion goals, the government

10   acknowledges that the verdicts on these counts are "'flawed'" (Government brief on

11   remand at 12 (quoting Skilling v. United States, 561 U.S. 358, 414 (2010))); see id. at 414

12   (quoting Yates v. United States, 354 U.S. 298 (1957) ("constitutional error occurs when

13   a jury is instructed on alternative theories of guilt and returns a general verdict that

14   may rest on a legally invalid theory")).

15                The government contends, however, that the convictions on Counts One

16   and Seventeen can be affirmed on the ground that the error was harmless.               We

17   disagree. In harmless-error analysis, the government bears the burden of proof, see,

18   e.g., United States v. Vonn, 535 U.S. 55, 62 (2002); United States v. Groysman, 766 F.3d

19   147, 155 (2d Cir. 2014); and it must sustain that burden beyond a reasonable doubt,

                                                 33
 1   see generally Neder v. United States, 527 U.S. 1, 15-19 (1999) (conviction may be affirmed

 2   if, after "a thorough examination of the record," the court "conclude[s] beyond a

 3   reasonable doubt that the jury verdict would have been the same absent the error,"

 4   id. at 19); see United States v. Coppola, 671 F.3d 220, 237-38 (2d Cir. 2012) (a Yates error

 5   would be harmless where "the jury necessarily would have had to" convict defendant

 6   on the basis of the valid ground). Given the emphasis the government placed on theft

 7   in its rebuttal summation to the jury, and the fact that the only substantive crimes on

 8   which the jury returned verdicts of guilty were the alleged property crimes under

 9   § 641, § 1343, and § 1348, we cannot conclude that the government has carried its

10   burden. Despite the fact that a plurality of the indictment's counts alleged substantive

11   counts of Title 15 securities fraud--and "[a]t its core," that is what this case was about-

12   -the jury acquitted each defendant on every such count in which he was charged. We

13   see no basis on which to infer that if there had been no charges of property crimes

14   or conspiratorial goals to commit property crimes, the jury would necessarily have

15   found that any of the defendants conspired to commit Title 15 securities fraud or to

16   defraud the United States. We cannot conclude that the inclusion of § 641 conversion

17   as a goal of the conspiracies alleged in Counts One and Seventeen was an error that

18   was harmless.

                                                 34
 1                On the other hand, we are not persuaded by defendants' argument that

 2   the convictions on these counts should simply be reversed.          Counts One and

 3   Seventeen allege § 371 conspiracies to defraud the United States; Count One alleges

 4   an additional objective of committing Title 15 securities fraud.            Section 371

 5   encompasses not just conspiracies to commit property crimes, but conspiracy to commit

 6   "any offense against the United States" and any conspiracy to "defraud the United

 7   States, or any agency thereof in any manner or for any purpose." 18 U.S.C. § 371;

 8   McNally v. United States, 483 U.S. 350, 358 n.8 (1987) (the defraud clause of § 371

 9   "reaches conspiracies other than those directed at property interests").    The record

10   contained sufficient evidence for submission of these counts to the jury.

11                We conclude that the convictions on Counts One and Seventeen should

12   be vacated, and the cases against Blaszczak, Huber, and Olan are remanded for such

13   further proceedings as may be necessary on these counts, which may include a new

14   trial.

15                                      CONCLUSION

16                We have considered all of the parties' arguments in support of their

17   respective positions on this remand. For the reasons discussed above, these cases are

                                              35
1   remanded to the district court to permit the government to dismiss Counts Two,

2   Three, Nine, Ten, Thirteen, Fifteen, Sixteen, and Eighteen.       The convictions of

3   Blaszczak, Huber, and Olan on Count One and of Blaszczak on Count Seventeen are

4   vacated, and the cases are remanded to the district court for such further proceedings

5   on these two counts as may be appropriate.

                                             36
 1   JOHN M. WALKER, JR., Circuit Judge, joined by Judge Kearse,

 2   concurring:

 3           I join Judge Kearse’s opinion in full. I write separately to

 4   highlight an anomaly in a separate ruling in Blaszczak I 1 that, while

 5   not discussed by today’s majority opinion because it is no longer

 6   outcome determinative, nevertheless deserves attention. In Blaszczak

 7   I, the panel held that a criminal conviction for tipper-tippee insider

 8   trading securities fraud prosecuted under 18 U.S.C. § 1348 does not

 9   require proof that the tipper received a “personal benefit.” 2 This

10   holding stands in contrast to the requirement of proof of a tipper’s

11   personal benefit when the government seeks criminal or civil

12   penalties for insider trading under Section 10(b) of the Securities

13   Exchange Act of 1934 3 and SEC Rule 10b-5 promulgated thereunder 4.

14           If that strikes one as odd, it should. Reasonable minds can

15   certainly differ on how the law can best prevent insider trading

16   without unduly impairing the normal functioning of security analysts

17   as informational intermediaries between companies and the market.

18   But traditional notions of fair play are offended by the present

             1  United States v. Blaszczak, 947 F.3d 19 (2d Cir. 2019), judgment vacated sub nom. Olan
     v. United States, 141 S. Ct. 1040 (2021), and judgment vacated, 141 S. Ct. 1040 (2021) (“Blaszczak
     I”).
              2 Id. at 45.

              3 15 U.S.C. § 78j(b).

              4 17 C.F.R. § 240.10b-5.

                                                                                                     1
 1   incongruence in this circuit between civil and criminal deterrence. It

 2   should not require fewer elements to prove a criminal conviction than

 3   to impose civil penalties for the same conduct. This asymmetry

 4   deserves the further attention of our court, the Supreme Court, and

 5   Congress.

 6                                   *           *          *

 7         The government can punish insider trading in two ways:

 8   through civil penalties under Rule 10b-5 or criminal prosecution

 9   under either Rule 10b-5 or 18 U.S.C. § 1348. These laws broadly

10   prohibit schemes or artifices to defraud in connection with the

11   securities market.              Neither provision expressly mentions insider

12   trading, but both can be used to police it, although under different

13   standards and elements.

14         Start with the text of § 10(b). The section prohibits any person

15   from “us[ing] or employ[ing], in connection with the purchase or sale

16   of any security . . . any manipulative or deceptive device or

17   contrivance in contravention of such rules and regulations as the

18   [Securities and Exchange] Commission may prescribe.” 5 Acting upon

19   its authority to implement § 10(b), the SEC promulgated Rule 10b-5,

20   which makes it unlawful, inter alia, “to employ any device, scheme, or

21   artifice to defraud” and “to engage in any act, practice, or course of

           5   15 U.S.C. § 78j(b).
                                                                                2
 1   business which operates or would operate as a fraud or deceit upon

 2   any person, in connection with the purchase or sale of any security.”6

 3   The texts of the statute and the regulation do not explicitly proscribe

 4   insider trading.         Courts, however, have located the proscription

 5   within § 10(b)’s broad prohibition against using “any . . . deceptive

 6   device” as well as the “inherent unfairness” that arises when a person

 7   “secret[ly] profits” from informational asymmetries “intended to be

 8   available only for a corporate purpose.” 7 But “not every instance of

 9   financial unfairness constitutes fraudulent activity under § 10(b)” and

10   Rule 10b-5. 8 The elaboration of these anti-fraud provisions to cover

11   insider trading has evolved through a process of judicial accretions

12   and enforcement decisions that reflect “judgments as to why insider

13   trading is or is not fraudulent, deceptive or manipulative.” 9

14           Courts have tethered § 10(b) and Rule 10b-5 liability to a breach

15   of a fiduciary duty in connection with the purchase or sale of a

16   security. 10 Under the “classical” theory, liability for insider trading is

17   predicated on an insider’s breach of the duty of trust and confidence

             6  17 C.F.R. §§ 240.10b-5(a), (c).
             7  Dirks v. SEC, 463 U.S. 646, 654 (1983) (quoting In re Merrill Lynch, Pierce, Fenner &
     Smith, Inc., 43 S.E.C. 933, 936 (1968)).
              8 Chiarella v. United States, 445 U.S. 222, 232 (1980).

              9 United States v. Chestman, 947 F.2d 551, 573 (2d Cir. 1991) (en banc) (Winter, J.,

     concurring in part and dissenting in part); cf. Blue Chip Stamps v. Manor Drug Stores, 421
     U.S. 723, 737 (1975) (in the context of private actions under Rule 10b-5, courts “deal with a
     judicial oak which has grown from little more than a legislative acorn”).
              10 Chestman, 947 F.2d at 570; see also Chiarella, 445 U.S. at 231-32.

                                                                                                   3
 1   that he owes, as an insider, to purchasers and sellers of his company’s

 2   stock. An insider violates § 10(b) and Rule 10b-5 when he trades

 3   based on material, non-public information. 11 The insider can also be

 4   liable as a “tipper” when he divulges—or tips—that inside

 5   information to outsiders.

 6           For an outsider, mere possession of an issuer’s nonpublic

 7   market information does not create a duty. 12 But an outsider who

 8   acquires a company’s inside information (a “tippee”) may still be

 9   prohibited from trading on that information if he received it from a

10   tipper who has breached her fiduciary duties and the tippee knows of

11   the tipper’s breach. It is the tipper’s predicate breach that allows a

12   tippee who trades with knowledge of the tipper’s breach to be held

13   derivatively liable.         The touchstone for whether the tipper has

14   breached those duties is whether the tipper received a “personal

15   benefit” in exchange for providing the inside information. 13

16           Again, nothing in the text of § 10(b) or Rule 10b-5 requires that

17   the tipper receive a “personal benefit.” But the Supreme Court, since

             11 United States v. O’Hagan, 521 U.S. 642, 651-52 (1997). O’Hagan recognized a
     second theory of insider trading liability—the “misappropriation theory”—premised on a
     breach of a duty a corporate “outsider” owes to the source of the information. Liability
     may attach when a person who owes no duty to company shareholders but to whom inside
     information has been entrusted “misappropriates [that] information for securities trading
     purposes.” Id. at 652-53.
             12 Dirks, 463 U.S. at 654 (quoting Chiarella, 445 U.S. at 235).

             13 United States v. Newman, 773 F.3d 438, 447-48 (2d Cir. 2014), abrogated on other

     grounds by Salman v. United States, 137 S. Ct. 420 (2016).
                                                                                              4
 1   Dirks v. SEC, 14 has imposed such a requirement. In a civil enforcement

 2   action against a tipper for a violation of § 10(b) and Rule 10b-5, 15 the

 3   government must prove that a tipper “(1) tip[ped] (2) material non-

 4   public information (3) in breach of a fiduciary duty of confidentiality

 5   owed to shareholders . . . or to the source of the information . . . (4) for

 6   personal benefit to the tipper.” 16

 7           Likewise, a tippee may be civilly liable when: 1) he knew or had

 8   reason to know that the tipper disclosed that information in breach of

 9   a duty and received a personal benefit in the process and 2) the tippee

10   used that information by trading or tipping for his own benefit in

11   disregard of that knowledge. 17 The precise nature of the “personal

12   benefit” in a particular case “will not always be easy for courts” to

13   determine. 18 But at least in theory, the Dirks test provides a “simple

14   and clear ‘guiding principle’ for determining tippee liability.” 19

             14  463 U.S. at 662; see also Salman v. United States, 137 S. Ct. 420 (2016).
             15  17 U.S.C. § 78u-1 (authorizing the SEC to seek civil penalties).
              16 SEC v. Obus, 693 F.3d 276, 286 (2d Cir. 2012).

              17 Id. at 289; see also Dirks, 463 U.S. at 660 (noting that tippee liability in the civil

     context may be predicated when the tippee knows or “should know” of the tipper’s
     breach). Cf. Salman, 137 S. Ct. at 423 (requiring knowledge of the tipper’s breach and the
     personal benefit for criminal prosecutions); United States v. Martoma, 894 F.3d 64, 76 (2d
     Cir. 2017) (“Martoma II”) (requiring that a tippee in a criminal prosecution be aware “not
     only that the tipper breached a fiduciary duty in disclosing inside information, but also
     that the tipper received a personal benefit”).
              18 Salman, 137 S. Ct. at 429.

              19 Id. at 428 (quoting Dirks, 463 U.S. at 664). A personal benefit “may be indirect

     and intangible and need not be pecuniary at all.” Martoma II, 894 F.3d at 75. Most recently,
     this court recognized that a personal benefit can exist based on, inter alia, “a relationship
     between the insider and the recipient that suggests a quid pro quo from the latter, or . . . an
     intention to benefit the particular recipient.” Id. at 74.
                                                                                                     5
 1           Now we turn to the text of 18 U.S.C. § 1348, which provides a

 2   broad criminal prohibition against securities fraud and thus insider

 3   trading. 20 For the government to secure a criminal conviction for

 4   violations of 18 U.S.C. § 1348, it must prove that a defendant

 5   knowingly engaged in a “scheme or artifice to defraud any person in

 6   connection with” a registered security or commodity of a publicly

 7   traded company. 21 Like § 10(b) and Rule 10b-5, nothing in the text of

 8   18 U.S.C. § 1348 requires proof of a personal benefit. 22

 9           The judicial accretion to § 10(b) and Rule 10b-5 requiring a

10   personal benefit to the tipper and knowledge of such by the tippee is

11   absent from our interpretation of § 1348. In Blaszczak I the panel

12   declined to “graft the Dirks personal-benefit test onto the elements of

13   Title 18 securities fraud” in a tipper-tippee insider trading

14   prosecution. 23       Because 18 U.S.C. § 1348 requires no proof of a

             20  18 U.S.C. § 1348. Congress enacted § 1348 with full knowledge of the
     jurisprudence regarding insider trading violations under Title 15. And, in 2009, when
     Congress amended the statute, Congress broadened its scope to include schemes to
     defraud that involved commodities futures. Pub. L. 107-204, Title VIII, § 807(a), 116 Stat.
     804 (2002) (amended 2009).
             21 18 U.S.C. § 1348(1). Section 1348 also makes it a crime “to obtain, by means of

     false or fraudulent pretenses, representations, or promises, any money or property in
     connection with the purchase or sale of any . . . security.” 18 U.S.C. § 1348(2). This
     provision is not relevant to this concurrence.
             22 The texts of the provisions do differ. Unlike § 10(b)’s requirement that a scheme

     have a nexus with a “purchase or sale” of a security, § 1348(1) broadly captures schemes
     “in connection with” any security. But the definition of “security” is more circumscribed
     for purposes of 18 U.S.C. § 1348 than in the Securities Exchange Act. Compare 18 U.S.C.
     § 1348(1) with 15 U.S.C. § 78c(a)(10).
             23 Blaszczak I, 947 F.3d at 37.

                                                                                               6
 1   personal benefit, the panel observed that the statute gives the

 2   government “a different—and broader—enforcement mechanism”

 3   than is available under § 10(b) and Rule 10b-5. 24

 4         Consider some of the potential consequences of a legal scheme

 5   that requires fewer elements to convict someone criminally than to

 6   penalize someone civilly for the same conduct.                      The risk of

 7   overdeterrence looms large:                  The government has expressly

 8   acknowledged that securities analysts, who routinely “ferret out and

 9   analyze information” from corporate insiders to price accurately a

10   security, are critical to a functioning market. 25 But when the bounds

11   of permissible conduct are not clearly delineated, parties are

12   prevented “from ordering their actions in accord with legal

13   requirements.” 26 The personal benefit test creates at least some legal

14   distinction between those who gave and obtained tips fraudulently

15   and those who appropriately engaged in the honest disclosure and

16   collection of corporate information. In this way, the element provides

17   corporate insiders and analysts (and their attorneys) with notice of

18   “when the line is crossed.” 27 Without it, corporate insiders may be

19   more reticent to share information with analysts in the ordinary

           24 Id. at 36 (emphasis added).
           25 Dirks, 463 U.S. at 658 n.17 (citing government’s brief).
           26 Id.

           27 Id.

                                                                                   7
 1   course of business and analysts who do receive company information

 2   may be less likely to act on it for fear of running afoul of § 1348.

 3           Beyond the problem that lawful market analyst activity may be

 4   inhibited in the wake of the Blaszczak I decision, 18 U.S.C. § 1348(1)’s

 5   criminal prohibition stands to capture more instances of tipper-tippee

 6   insider trading than would be civilly sanctionable. In the Blaszczak

 7   trial it was no accident that the jury convicted the defendants of

 8   insider trading fraud by violating 18 U.S.C. § 1348 but acquitted them

 9   of the same conduct under § 10(b) and Rule 10b-5. 28 Under Blaszczak I,

10   the government may prosecute someone as a tippee when he trades

11   on company information that he knows to be material and non-

12   public, without proving that the source of that information was

13   engaged in self-dealing. 29

14           To be sure, the higher standard of proof to secure a criminal

15   conviction may mitigate this incongruence to a degree. But the threat

16   of criminal exposure (or a referral from the SEC to a United States

17   Attorney’s office) is a weighty cudgel in plea bargaining and in

18   extracting civil settlements. It also poses a challenge to the lawyer

             28 See Blaszczak I, 947 F.3d at 26. Of course, with our opinion today, we vacate those
     convictions under § 1348 for the separate reason that the government failed to prove that
     the information the defendants obtained was “property” within the meaning of the
     statute—an element distinct from the receipt of a “personal benefit.”
             29 Id. at 36.

                                                                                                 8
 1   advising the security analyst who has no desire to run afoul of the law

 2   but wants to be able to do his job effectively. 30

 3                             *                *                *

 4         We are taught that judges must “take the statute as we find it” 31

 5   and that we should “assume that Congress is aware of existing law

 6   when it passes legislation,” including statutes and judicial “gloss”—

 7   such as Dirks’s personal benefit test. 32 Thus I understand the Blaszczak

 8   I panel’s decision, in the absence of Supreme Court guidance, not to

 9   import a personal benefit element to securities fraud prosecutions

10   under 18 U.S.C. § 1348. I write separately, however, to highlight a

11   glaring anomaly that the panel’s decision creates and that warrants

12   further attention by Congress and the courts.

           30 The dissent purports to explain the discrepancy between 18 U.S.C. § 1348 and §
           10(b) and Rule 10b-5 by reference to the enacting Congresses’ purpose. See
           Dissenting Opp. at 31-34. It does not address, however, the troubling effects on the
           heretofore legitimate conduct of securities analysts in the market who could not
           be subject to criminal or even civil liability under § 10b and Rule 10b-5, but may
           be prosecuted criminally for the same conduct under 18 U.S.C. § 1348, which are
           the focus of this concurrence.
           31 Anderson v. Wilson, 289 U.S. 20, 27 (1933) (Cardozo, J.).

           32 Miles v. Apex Marine Corp., 498 U.S. 19, 32 (1990).

                                                                                             9
RICHARD J. SULLIVAN, Circuit Judge, dissenting:

      For the reasons set forth below and in this Court’s 2019 opinion, I remain

convinced that the defendants’ convictions should be affirmed. See United States

v. Blaszczak (Blaszczak I), 947 F.3d 19 (2d. Cir. 2019). As the jury concluded beyond

a reasonable doubt, the defendants participated in a multi-million-dollar scheme

to misappropriate and trade on confidential information in the possession of the

Centers for Medicare and Medicaid Services (“CMS”) concerning the timing and

content of contemplated changes to the agency’s reimbursement rules. To my

mind, nothing in the Supreme Court’s subsequently issued opinion in Kelly v.

United States, 140 S. Ct. 1565 (2020), alters the conclusion that “CMS information . . .

constitute[d] ‘property’ in the hands of the government for purposes of the

wire[-]fraud and Title 18 securities[-]fraud statutes,” Blaszczak I, 947 F.3d at 26.

      The majority opinion effectively permits sophisticated insiders to leverage

their access to confidential government information and sell it to the highest

bidders – in this case, hedge funds that used the confidential information to make

millions shorting the stocks of public companies affected by CMS’s regulations. In

addition to running roughshod over CMS’s obvious “property interest in . . . its

[own] private records,” id. at 33 (quoting United States v. Girard, 601 F.2d 69, 71
(2d Cir. 1979)), the majority opinion also threatens to upend decades of settled

precedent concerning frauds premised on the theft of intangible property and

suggests – in what amounts to dicta – a curious and troubling rule of deference

that would require federal courts to acquiesce whenever the government

announces a new, post-conviction statutory interpretation.

      Equally troubling is the concurrence, which – also in dicta – offers a

gratuitous advisory opinion on a subject that clearly exceeds the scope of the

Supreme Court’s remand order and, not surprisingly, was neither briefed nor

argued by the parties on remand. In addition to its overreach, the concurrence is

also wrong on the merits.

      For all these reasons, I respectfully dissent.

                                          I.

      The majority opinion concludes that confidential information held by a

government agency is not property. See Maj. Op. at 27–32. That conclusion cannot

be squared with the language of the federal fraud statutes at issue in this case. In

particular, 18 U.S.C. § 1343, the wire-fraud statute, provides:

      Whoever, having devised or intending to devise any scheme or
      artifice to defraud, or for obtaining money or property by means of
      false or fraudulent pretenses, representations, or promises, transmits

                                          2
       or causes to be transmitted by means of wire, radio, or television
       communication in interstate or foreign commerce, any writings, signs,
       signals, pictures, or sounds for the purpose of executing such scheme
       or artifice, shall be fined under this title or imprisoned not more than
       20 years, or both.

18 U.S.C. § 1343. Similarly, section 1348, the Title 18 securities-fraud statute,

provides in relevant part:

       Whoever knowingly executes, or attempts to execute, a scheme or
       artifice – (1) to defraud any person in connection with any commodity
       for future delivery, or any option on a commodity for future delivery,
       or any security of an issuer . . . ; or (2) to obtain, by means of false or
       fraudulent pretenses, representations, or promises, any money or
       property in connection with the purchase or sale of . . . any security of
       an issuer . . . ; shall be fined under this title, or imprisoned not more
       than 25 years, or both.

Id. § 1348. 1

       Neither statute distinguishes between tangible and intangible property, or in

any way suggests that information in the possession of a government agency as

opposed to a private entity is beyond the scope of the statute. Each statute merely

requires that the object of the fraud be “property” in the hands of the victim. See

1 The superseding indictment charged the defendants with violating both subsections (1) and (2)
of 18 U.S.C. § 1348, either of which may independently support a conviction. While only
subsection (2) uses the term “property,” the defendants do not argue that the object of a
“scheme . . . to defraud” in subsection (1) can be anything other than “property.” 18 U.S.C. § 1348.
I have thus assumed, for purposes of this case, that the “property” requirement in subsection (2)
also applies in subsection (1). Id.

                                                 3
Cleveland v. United States, 531 U.S. 12, 26 (2000); see also Neder v. United States, 527

U.S. 1, 20–21 (1999) (noting that Title 18 mail-, wire-, and bank-fraud statutes

should be analyzed similarly). Here, the object of the defendants’ fraud was

CMS’s confidential, proprietary information, and the Supreme Court’s decision in

Kelly does not compel the vacatur of the defendants’ convictions.

                                          A.

      For nearly four decades, courts have recognized that confidential

information constitutes property under the mail- and wire-fraud statutes.

Nowhere is this better illustrated than in Carpenter v. United States, in which the

Supreme Court held that the publication schedule and contents of forthcoming

columns in The Wall Street Journal were the Journal’s “property” because “[t]he

Journal had a property right in keeping confidential and making exclusive use” of

the information before publication. 484 U.S. 19, 26 (1987). The Supreme Court

noted that “[c]onfidential business information has long been recognized as

property.” Id. The Supreme Court also stressed that the Journal “ha[d] been

deprived of its right to exclusive use of the information” and that “exclusivity is an

important aspect of confidential business information and most private property for

that matter.”   Id. at 26–27 (emphases added).        The Supreme Court therefore

                                           4
concluded that the Journal employee fraudulently misappropriated his employer’s

“property” in violation of the mail- and wire-fraud statutes when he knowingly

disclosed the Journal’s confidential, pre-publication information to a stockbroker

who traded on it. Id. at 28.

      The Supreme Court reached a similar conclusion in United States v. O’Hagan,

521 U.S. 642 (1997). There, a corporate partner at a law firm was convicted on

fifty-seven counts of mail fraud, securities fraud, and money laundering after he

traded the securities of his client’s acquisition target before the acquisition became

public. Id. at 647. The Supreme Court upheld the convictions and recognized a

“misappropriation theory” of fraud, under which a defendant’s “undisclosed

misappropriation of [confidential] information[] in violation of a fiduciary

duty . . . constitutes fraud akin to embezzlement.”       Id. at 654.   Applying the

misappropriation theory, the Supreme Court reasoned that the defendant’s

convictions were valid, since the defendant breached the “duty of trust and

confidence he owed to his law firm . . . and its client” when he “traded on the basis

of nonpublic information regarding” the potential acquisition. Id. at 653 (emphasis

added).

                                          5
         Decades later, it is difficult to see a meaningful distinction between The Wall

Street Journal’s pre-publication information in Carpenter, the law firm’s and its

client’s pre-acquisition information in O’Hagan, and CMS’s pre-publication

information concerning changes to its reimbursement rates here. In each case, the

owner of the information “had a property right in keeping confidential and

making exclusive use” of the information before publication. Carpenter, 484 U.S.

at 26.    And in each case, the defendants endeavored to misappropriate that

information without the owner’s knowledge and trade on it without the owner’s

consent.

                                            B.

         Like the dissent in Blaszczak I, the majority opinion relies heavily on

Cleveland v. United States to suggest that confidential information in the possession

of the government is somehow entitled to less protection than comparable

confidential information in the hands of private entities. See Maj. Op. at 28. But

Cleveland bears little resemblance to this case and creates no such immunity for the

theft of governmental property. In Cleveland, the defendants were indicted for

mail fraud under 18 U.S.C. § 1341 for fraudulently concealing information from

the state of Louisiana in their applications to obtain poker-machine licenses. 531

                                            6
U.S. at 17. The Supreme Court concluded that the defendants’ convictions could

not stand because an unissued license in the hands of the state is not property. Id.

at 27. As the Court explained, prior to a license’s issuance, the state’s “core

concern” is the “regulatory” decision, made in its capacity as sovereign, concerning

whether to grant or deny the license. Id. at 20–21 (emphasis in original). According

to the Court, a scheme to influence “a typical regulatory program” is not a scheme

to deprive the government of its property. Id. at 21.

      Clearly, the scheme in Cleveland to influence the government’s licensing

decisions had little in common with the Blaszczak defendants’ scheme to

misappropriate the government’s confidential information.         The goal of the

defendants in this case was not to influence the government’s licensing decision or

alter the government’s reimbursement policy – each of which obviously is a

regulatory act. It was instead to misappropriate confidential information in CMS’s

possession so that the defendants could trade on it. Nowhere in Cleveland did the

Supreme Court suggest that government entities are incapable of having property

interests in such confidential information; the Court merely held that the

government’s decision whether to issue licenses – the object of the defendants’

                                         7
fraudulent scheme there – was not itself property. In the end, Cleveland has little to

say about this case.

                                         C.

      The majority opinion nevertheless doubles down on its reading of Cleveland

by insisting that the Supreme Court’s decision in Kelly v. United States has radically

truncated the government’s property rights in its own confidential information.

Again, I am not persuaded.

      In Kelly, the defendants were government employees who reallocated access

to the George Washington Bridge in an effort to exert political pressure on a

recalcitrant mayor. 140 S. Ct. at 1569–71. For decades, three lanes feeding onto the

bridge had been reserved for commuters coming from Fort Lee, New Jersey during

the morning rush hour. See id at 1568. But as a form of political payback for the

mayor’s failure to endorse the incumbent governor in an upcoming election,

employees in the New Jersey Governor’s office created a horrific traffic jam by

reducing the number of lanes dedicated to Fort Lee from three to one. See id.

at 1569. The Supreme Court, relying principally on Cleveland, unanimously held

that this was not a scheme that “aim[ed] to obtain money or property.” Id. at 1574.

As the Court observed, the defendants did not “walk away with the lanes” or

                                          8
“convert[] them to a non-public use”; they merely closed two of the three traffic

lanes, which “was a quintessential exercise of regulatory power.” Id. at 1572.

Finding that “a scheme to alter such a regulatory choice is not one to appropriate

the government’s property,” id. (citing Cleveland, 531 U.S. at 23), the Supreme

Court overturned the defendants’ convictions under the federal fraud statutes, id.

at 1574.

       The differences between this case and Kelly are obvious. Here, CMS’s

confidential information more closely resembles the misappropriated property

recognized in Carpenter than the allocation of traffic lanes at issue in Kelly or the

licensing decision at issue in Cleveland. Like The Wall Street Journal, CMS had a

“property right in keeping confidential and making exclusive use [of]” its

nonpublic, pre-publication information. Carpenter, 484 U.S. at 26. In stark contrast

to a state’s right to allocate traffic lanes in Kelly or issue poker licenses in Cleveland –

each a “paradigmatic exercise[] of the [state’s] traditional police powers,”

Cleveland, 531 U.S. at 23 – the government’s right to exclude the public from

accessing its confidential information concerning the content and timing of its

reimbursement rates for various medical procedures squarely implicates its role

as a property holder, not as sovereign. See Loretto v. Teleprompter Manhattan CATV

                                             9
Corp., 458 U.S. 419, 435 (1982) (“The power to exclude has traditionally been

considered one of the most treasured strands in an owner’s bundle of property

rights.”); Cedar Point Nursery v. Hassid, 141 S. Ct. 2063, 2073 (2021) (describing the

“central importance to property ownership of the right to exclude”). This view is

consistent with decisions from this and other circuits. See, e.g., Girard, 601 F.2d

at 70–71 (concluding that “the [g]overnment has a property interest in certain of

its private records,” including the “confidential” information contained in those

records); United States v. Czubinski, 106 F.3d 1069, 1074 (1st Cir. 1997) (holding that

the IRS’s confidential taxpayer information “may constitute intangible ‘property’”

under the wire-fraud statute (citing Carpenter, 484 U.S. at 26)).

      Curiously, the majority opinion repeatedly quotes Kelly’s holding that “a

scheme to alter . . . a regulatory choice is not one to appropriate the government’s

property.” Maj. Op. at 10, 28, 29 (quoting Kelly, 140 S. Ct. at 1572). But that line

from Kelly only highlights the difference between the two cases.            Here, the

defendants had no interest in “alter[ing]” CMS’s “regulatory choice[s].”            Id.

Rather, their goal was to gain access to CMS’s confidential, pre-publication

reimbursement rates without being discovered so that they could trade on the

information before it was disclosed to the public. In fact, the defendants’ scheme

                                          10
depended on keeping those choices – the timing and content of the reimbursement

rates – unaltered. After all, only if the pre-publication information remained the

same could they trade on the inside information for a profit before it became

public.

      The majority opinion insists that “altering” the government’s regulation and

“obtaining” the government’s information amount to the same thing for purposes

of sections 1343 and 1348. Maj. Op. at 31. But the verbs that the majority opinion

uses – “altering” and “obtaining” – underscore the problem with conflating the

government’s two distinct roles. Id. “Altering” suggests the exertion of power

upon another, see Alter, Oxford English Dictionary (3d ed. 2010) (“To make (a

person or thing) otherwise or different in some respect.”), whereas “obtaining”

suggests the acquisition of a thing from another, see Obtain, Oxford English

Dictionary (3d ed. 2010) (“To come into the possession of; to procure; to get,

acquire, or secure.”). While the former points to interfering with the state’s

regulatory role as sovereign, the latter points to interfering with the state’s role as

a property holder.

      Fundamentally,       the    majority     opinion’s    view    obliterates    the

distinction – drawn by the Supreme Court in both Cleveland and Kelly – between

                                          11
the government’s exercise of regulatory authority and the government’s

possession of property in aid of its regulatory agenda. See Cleveland, 531 U.S.

at 23–24 (“[T]he [s]tate’s interest in licensing video poker operations . . . implicates

the [state’s] role as sovereign, not as property holder.”); Kelly, 140 S. Ct. at 1572

(“The defendant’s fraud implicated the [g]overnment’s role as sovereign wielding

traditional police powers – not its role as property holder.” (alteration and internal

quotation marks omitted)). To acknowledge that distinction is to acknowledge

that the government can be a property holder.

      Indeed, the Kelly Court’s hypothetical examples of what would have

amounted to fraudulently obtaining government property there – “walk[ing]

away with the lanes” or “converting them to a non-public use,” 140 S. Ct. at 1573 –

aptly describes what the defendants actually did here. Worral “walk[ed] away

with [CMS’s confidential data],” and Blaszczak “convert[ed] them to . . .

non-public use” in Huber and Olan’s scheme to profit from shorting stock in

companies that would be adversely impacted by CMS’s yet-unannounced

reimbursement decisions. Id.; see Blaszczak I, 947 F.3d at 26–27 (describing this

scheme).

                                          12
      Finally, the majority follows the government’s lead in invoking Kelly for the

notion that confidential government information “typically must have economic

value . . . to constitute ‘property.’” Maj. Op. at 12. But the Supreme Court in Kelly

simply held that a fraudulent scheme against the government must aim not just to

“alter a regulatory decision,” 140 S. Ct. at 1574, but “to obtain money or property,”

id. at 1573. The Supreme Court said nothing about the definition of property, let

alone that it must have economic value. Because the object of the defendants’

scheme in this case was to misappropriate CMS’s confidential information, I see

no reason to vacate the defendants’ convictions on the basis of the Supreme

Court’s decision in Kelly.

                                         D.

      Unable to rely on Kelly, the majority opinion resorts to other justifications

for its holding that CMS’s confidential information is not property – and not

entitled to the same protections afforded to The Wall Street Journal’s

pre-publication information in Carpenter. None is convincing.

                                         13
                                          1.

      The majority opinion suggests that a government agency cannot have a

property interest in confidential information because it “is not a commercial

entity.” Maj. Op. at 29–30. There are two problems with this reasoning.

      As a threshold matter, such a conclusion is inconsistent with – and would

effectively overrule – our precedent holding that “the [g]overnment has a

property interest in certain of its private records,” including the confidential

information contained in those records. Girard, 601 F.2d at 71. Obviously, “one

panel of this court may not overrule the decision of a prior panel,” Finkel v. Stratton

Corp., 962 F.2d 169, 174–75 (2d Cir. 1992), unless “an intervening Supreme Court

decision casts doubt on the prior ruling,” Doscher v. Sea Port Grp. Sec., LLC, 832 F.3d

372, 378 (2d Cir. 2016) (citation omitted), abrogated on other grounds by Badgerow v.

Walters, 142 S. Ct. 1310 (2022). Here, as explained above, Kelly casts no doubt on

the well-established rule that government entities can and do have property rights.

      The majority attempts to sidestep the clear holding of Girard by insisting

that Girard is distinguishable from the case before us. It is not. In Girard, we

affirmed the defendants’ convictions under 18 U.S.C. §§ 641 and 371 for selling

and conspiring to sell confidential information about informants working for the

                                          14
Drug Enforcement Administration (the “DEA”).           See Girard, 601 F.2d at 70.

Although the majority opinion concedes that the DEA’s informant records in

Girard were “inherently valuable” to the DEA, it conclusorily asserts that CMS’s

reimbursement rates are not “comparable” to the DEA’s informant records. Maj.

Op. at 31. In fact, both this case and Girard concern whether the government has

a property interest in the “intangible” contents of its “confidential,” “unpublished

writings.” Girard, 601 F.2d at 71. Like the informant records in Girard, which the

majority opinion deems to have “inherent value to the DEA in investigations and

preparation for prosecutions,” Maj. Op. at 31, the reimbursement rates here were

integral to CMS’s administration of “federal . . . healthcare financing programs,”

App’x at 464. And just as the “theft [of the informant records in Girard] would

interfere with [the DEA’s] operations,” Maj. Op. at 31, the pre-publication leak of

CMS’s reimbursement rates here would “risk[] hampering the agency’s

decision-making process” by encouraging “unbalanced lobbying efforts,”

“making it more difficult to manage the [information] process flow,” and

“requir[ing] the agency to tighten up its internal information-sharing processes,”

Blaszczak I, 947 F.3d at 33 (internal quotation marks omitted) (citing App’x at 467).

Fundamentally, nothing in Girard justifies the majority’s conclusion that the

                                         15
government can have a property interest in the DEA’s confidential informant

information but not in CMS’s pre-publication reimbursement rates. The majority’s

disclaimer that it is not overruling Girard is therefore hard to reconcile with the

clear similarity between the facts and logic of the two cases.

      Nevertheless, even if this panel had the power to overrule Girard, the

majority opinion offers no rationale for a rule that would protect the property

rights of commercial entities but not those of governmental agencies possessing

comparable information. Why, one might ask, would the fraud statutes prohibit

schemes to gain access to a manufacturer’s confidential information concerning

the costs of production for assorted medical devices, but not extend that same

protection to the government’s confidential information regarding the

reimbursement rates for those very devices?         Certainly, no such distinction

appears on the face of sections 1343 or 1348, and it defies common sense to think

that Congress would give fraudsters carte blanche to misappropriate the

“confidential information” of any and every “regulatory agency.” Maj. Op. at 29.

                                         2.

      As in the Blaszczak I dissent, the majority opinion also implies that entities

cannot have a property interest in confidential information unless the confidential

                                         16
information constitutes their “stock in trade” – a phrase plucked from Carpenter.

Maj. Op. at 29 (quoting Carpenter, 484 U.S. at 26). But while the Carpenter court did

use that phrase to help illustrate the Journal’s interest in the property, it never made

that a prerequisite for information to be considered property. Indeed, there are

myriad cases in which the misappropriated property – whether press releases,

earnings reports, or merger information – was deemed to be property for purposes

of the mail-, wire-, and securities-fraud statutes even though the information in

question was clearly not part of the victim’s “stock in trade.” See, e.g., United States

v. Khalupsky, 5 F.4th 279, 285 (2d Cir. 2021) (affirming wire- and securities-fraud

convictions based on trades using “information from stolen, pre-publication press

releases” of various publicly traded companies); SEC v. Dorozhko, 574 F.3d 42, 44

(2d Cir. 2009) (vacating the district court’s denial of the SEC’s motion for an

asset-freeze injunction in an enforcement action based on the defendant’s hacking

activities to gain access to a healthcare company’s “earnings reports”); O’Hagan,

521 U.S. at 672 (upholding mail- and securities-fraud convictions for “fraudulent

trading on material, nonpublic information” regarding “the tender offer” for a

major grain and foodstuffs producer).            In none of these cases did the

misappropriated information relate to the core business – or “stock in trade” – of

                                          17
the defrauded entities. The majority opinion’s “stock[-]in[-]trade” requirement

would effectively undermine each of these cases without offering any principled

basis for doing so.

                                         3.

      Additionally, the majority opinion suggests that property interest is limited

to goods that can be “distributed and sold to those who would pay money for it.”

Maj. Op. at 29 (quoting Carpenter, 484 U.S. at 26) (alterations omitted). But the law

does not suggest that a property interest exists only in things that can be

monetized. See Phillips v. Washington Legal Found., 524 U.S. 156, 170 (1998) (“While

the interest income at issue here may have no economically realizable value to its

owner, possession, control, and disposition are nonetheless valuable rights that

inhere in the property.”).       Indeed, there are many items – tangible and

intangible – that have no market value but are clearly recognized as property. For

instance, there may not be any market value for the baby shoes, diaries, or old

photos of our non-celebrity relatives, but there is no question that we own those

things after they are passed down to us. See, e.g., Restatement (Second) of Torts

§§ 222A, 911 cmt. e (Am. L. Inst. 1979) (noting that for purposes of liability and

damages for conversion, “[s]ome things may have no exchange value but may be

                                         18
valuable to the owner”). In short, the ability to monetize property does not define

property rights.

      Relatedly, the majority opinion stresses the fact that the disclosure of a

government agency’s confidential information has no effect on the public fisc.

Maj. Op. at 30. That of course is true but beside the point. Whether the victim is

economically harmed by the misappropriation is immaterial to whether the

misappropriated information is in fact property.         There was no evidence in

Carpenter to suggest that The Wall Street Journal’s bottom line was affected by the

misappropriation of its columns, or that its ability to publish articles or retain

subscribers was in any way compromised. Regardless of any economic harm that

it may suffer as a result of the misappropriation, the owner still retains its property

right in the confidential information and may exclude others from accessing and

using it.

                                    *      *     *

      In short, the majority opinion’s efforts to distinguish between the

pre-publication information in Carpenter and CMS’s confidential information here

are not persuasive. Kelly only reinforces that governments – like corporations,

partnerships, and individuals – can possess property rights in confidential

                                          19
information. It logically follows that schemes to misappropriate such information

are clearly within the scope of the federal mail-, wire-, and securities-fraud

statutes.    I therefore see no basis for the majority’s conclusion that CMS’s

confidential information did not constitute “property” for purposes of 18 U.S.C.

§§ 1343 and 1348. 2

                                                II.

       The bulk of the majority opinion, however, focuses not on Kelly’s application

to this case, but rather on the “deference” that we purportedly “owe[]” to “the

Department of Justice’s post-Kelly position on the scope of ‘property’ under

18 U.S.C. §§ 1343 and 1348.” Maj. Op. at 13, 26 (quoting Gov’t Suppl. Br. at 2). The

portion of the majority opinion addressing that issue – which was neither briefed

nor argued by the parties – is dicta. It is “a point of law [that] might have been

decided either way without affecting” the majority’s bottom-line “decision”; it

2 The majority opinion also holds that CMS’s confidential information concerning its
reimbursement rates did not constitute a “thing of value” for purposes of 18 U.S.C. § 641. See
Maj. Op. at 30. Our case law defines the phrase “thing of value” under section 641 by reference
to case law interpreting the term “property.” See Girard, 601 F.2d at 71. But, as discussed, Girard
also defines both “thing of value” and “property” to include certain private government records,
including the “confidential” information contained in those records. Id. The majority opinion
has not articulated any reason to depart from Girard, and I would continue to follow this Court’s
precedent and hold that CMS’s confidential information constitutes both a “thing of value” and
“property” under the relevant statutes.

                                                20
therefore “cannot be binding.” Jimenez v. Walker, 458 F.3d 130, 142–43 (2d Cir.

2006) (quoting Carroll v. Lessee of Carroll, 57 U.S. (16 How.) 275, 286–87 (1853))

(other citation omitted). Indeed, the majority opinion appears to recognize as

much.    After nearly twenty pages spent straining to establish that “the

prosecutorial discretion [of] the Executive Branch” is a reason “to remand the cases

to the district court for dismissal,” Maj. Op. at 6, the majority opinion ultimately

acknowledges that we may in fact be “required to address the merits of the

convictions,” id. at 27 – and then decides the appeal on the basis that the

defendants’ convictions cannot be sustained in light of Kelly.

      In any event, I disagree with the majority opinion’s suggestion that “the

Department of Justice’s post-Kelly position on the scope of ‘property’ under

[sections] 1343 and 1348” is “owed deference” of any form. Maj. Op. at 13, 26

(quoting Gov’t Suppl. Br. at 2). From the outset, that suggestion is in tension with

the Supreme Court’s repeated admonitions that “criminal laws are for courts, not

for the [g]overnment, to construe,” Abramski v. United States, 573 U.S. 169, 191

(2014), and that accordingly, the “[g]overnment’s reading of a criminal statute” is

not “entitled to any deference,” United States v. Apel, 571 U.S. 359, 369 (2014).

Indeed, “court[s] ha[ve] an obligation to correct” the Department of Justice’s

                                        21
“error[s]” in interpreting criminal statutes, regardless of “[w]hether the

[g]overnment interprets a criminal statute too broadly or too narrowly.” Abramski,

573 U.S. at 191 (emphasis added).

      The majority opinion attempts to maneuver around these precedents by

characterizing “the government’s decision” to “confess[] . . . error” and “seek the

dismissal of the . . . counts convicting defendants” as an exercise of “the

prosecutorial discretion to which the Executive Branch of the government is

entitled.” Maj. Op. at 15, 26. But as the Supreme Court has explained – and the

majority opinion itself acknowledges – “such a confession [of error] does not

relieve . . . [c]ourt[s] of the performance of the judicial function,” id. at 21 (quoting

Young v. United States, 315 U.S. 257, 258 (1942)), which of course “is

emphatically . . . to say what the law is,” Marbury v. Madison, 5 U.S. (1 Cranch) 137,

177 (1803) (emphasis added).          In other words, since “our judgments are

precedents” that implicate “[t]he public interest . . . in every criminal proceeding,”

the “proper administration of the criminal law cannot be left merely to the

stipulation of parties.” Young, 315 U.S. at 259 (emphasis added). For that reason,

“[i]t is the uniform practice of [the Supreme] Court to conduct its own examination

of the record in all cases where the [f]ederal [g]overnment . . . confesses that a

                                           22
conviction has been erroneously obtained.” Sibron v. New York, 392 U.S. 40, 58

(1968); see also Young, 315 U.S. at 258–59 (“[O]ur judicial obligations compel us to

examine independently the errors confessed.”).

      The Supreme Court’s recent decision in Terry v. United States is instructive

on this point. 141 S. Ct. 1858 (2021). There, a prisoner petitioned the district court

for a resentencing pursuant to the First Step Act, arguing that he fell within the

category of crack-cocaine offenders covered by that Act. See id. at 1862. The

district court denied his motion, the Eleventh Circuit affirmed, and the Supreme

Court granted certiorari. See id. On the day the government’s brief was due, the

Solicitor General informed the Supreme Court that, “after the change in

administration,” the government “would no longer defend the judgment” of the

Eleventh Circuit. Id. But the Supreme Court did not blindly acquiesce in the

Solicitor General’s request to summarily reverse the Eleventh Circuit. Instead, the

Court rescheduled argument and appointed an amicus curiae to argue in support

of the judgment – which the Supreme Court ultimately affirmed in a unanimous

opinion. See id. at 1864.

      The Supreme Court appoints an amicus to argue a case about once a year,

see Katherine Shaw, Friends of the Court: Evaluating the Supreme Court’s Amicus

                                         23
Invitations, 101 Cornell L. Rev. 1533, 1548 (2016), often in situations where the

government does not oppose the position advanced by its adversary, see, e.g.,

Terry, 141 S. Ct. at 1864; Seila Law LLC v. CFPB, 140 S. Ct. 2183, 2195 (2020)

(appointing an amicus when the government declined to oppose its petitioner’s

arguments).     This    practice   would       be   nonsensical – not   to    mention

unconstitutional – under the majority opinion’s theory that separation-of-powers

principles compel us to defer to the government whenever it confesses error.

      While there can be no doubt that the government has broad discretion in

deciding which cases to prosecute and how to prosecute those cases, once the

government has involved the judiciary by obtaining an indictment or a conviction,

its discretion is tempered by the courts’ independent obligations. In other words,

we cannot tell the government whom to prosecute. See United States v. Armstrong,

517 U.S. 456, 464 (1996) (“[S]o long as the prosecutor has probable cause to believe

that the accused committed an offense defined by statute, the decision whether or

not to prosecute . . . generally rests entirely in his discretion.”); see also Wayte v.

United States, 470 U.S. 598, 607–08 (1985) (examining the “substantial concerns

that make the courts properly hesitant to examine the decision whether to prosecute”

(emphasis added)). The government likewise cannot tell us whether to vacate a

                                          24
duly obtained conviction. See Young, 315 U.S. at 258–59 (“The public trust reposed

in the law[-]enforcement officers of the [g]overnment requires that they be quick

to confess error when, in their opinion, a miscarriage of justice may result from

their remaining silent. But . . . our judicial obligations compel us to examine

independently the errors confessed.”).

      The majority opinion’s citations to cases in which courts have “honored the

government’s decision . . . to end its pursuit of a . . . prosecution,” Maj. Op. at 24;

see generally id. at 16–27, only underscore that the government’s broad discretion

to “terminate” an ongoing prosecution, id. at 18, 19 (citations omitted), stops short

of binding appellate courts “to treat a confession of error by the United States as

an appellate nolle prosequi,” Cachoian v. United States, 452 F.2d 548, 550 (5th Cir.

1971). Upon closer inspection, those cases are readily distinguishable from the one

before us. Here, we are asked to decide whether final judgments of conviction

entered after a jury trial and sentencing should be vacated because the government

now contends that they were based on an alleged legal error. Most of the cases

cited in the majority opinion, however, were in materially different procedural

                                          25
postures. 3 And in the few cases in which courts agreed with the government’s

request to dismiss an indictment or vacate a judgment of conviction, those courts

did so only after fulfilling their obligation to independently assess the underlying

validity of the indictments or convictions at issue. See, e.g., Rinaldi v. United States,

434 U.S. 22, 23, 29–30 (1977) (dismissing indictment); United States v. DiMattina,

571 Fed. App’x 50 (2d Cir. 2014) (vacating conviction). 4 Again, to quote the

Supreme Court in Young, the government’s confession of error “does not relieve

[courts] of the performance of the judicial function” – rather, “our judicial

obligations compel us to examine independently the errors confessed.” 315 U.S.

at 258–59; see also Petite v. United States, 361 U.S. 529, 533 (1960) (Brennan, J.,

concurring) (“Even where the Government confesses error, [the Supreme] Court

examines the case on the merits itself.”).

3See Gaona-Romero v. Gonzales, 497 F.3d 695 (5th Cir. 2007) (vacating a prior panel’s decision
affirming a final order of removal by the Board of Immigration Appeals); United States v. Fokker
Servs. B.V., 818 F.3d 733, 738 (D.C. Cir. 2016) (vacating the district court’s denial of a joint motion
to exclude time under the Speedy Trial Act); Order Dismissing Appeal, United States v. Aytes,
No. 19-3981, Doc. No. 70 (2d Cir. Apr. 13, 2021) (granting the government’s motion to dismiss its
appeal of the district court’s judgment of acquittal).

4See also United States v. Weber, 721 F.2d 266, 268–89 (9th Cir. 1983) (considering whether dismissal
was “clearly contrary to manifest public interest”); United States v. Smith, 55 F.3d 157, 160 (4th Cir.
1995) (concluding that there was “[a] substantial, reasonable doubt about the guilt of [the]
defendant”).

                                                  26
      The majority opinion gets it backwards by suggesting that “the [s]eparation

of [p]owers,” Maj. Op. at 23 (citation omitted), might compel us “to accept [the

government’s] view blindly,” Sibron, 392 U.S. at 59. In actuality, the principles of

the separation of powers cut in precisely the opposite direction. To “blindly” defer

to the government’s confession of error “would be . . . an abdication of our

obligation to lower courts to decide cases upon proper . . . grounds in a manner

which permits them to conform their future behavior to the demands of the

[federal criminal law].” Id. Moreover, “it ill behooves this Court to defer to the

Solicitor General’s suggestion that a [district court] may have been in error after

another representative of the Executive Branch and the Justice Department has

persuaded the [district court] to reach the result which it did.” Mariscal v. United

States, 449 U.S. 405, 406–07 (1981) (Rehnquist, J., dissenting).

      In short, we may not mechanically defer to the government in determining

whether a defendant’s convictions should be vacated. “We sit in this case not

to enforce the requests of the Department of Justice but to review the action of a

lower court,” Casey v. United States, 343 U.S. 808, 811 (1952) (Douglas, J.,

dissenting), now “in light of Kelly[’s]” guidance, Blaszczak v. United States, 141 S. Ct.

1040 (2021). The question we must ask – which only we may answer – is whether

                                           27
Kelly compels the vacatur of the defendants’ convictions. Because I see nothing in

Kelly to alter our prior conclusion that “CMS information . . . constitute[d]

‘property’ in the hands of the government for purposes of the wire[-]fraud and

Title 18 securities[-]fraud statutes,” Blaszczak I, 947 F.3d at 26, I would affirm.

                                          III.

      I turn finally to the concurrence, which similarly offers pages of dicta on a

subject that is not even properly before us – Blaszczak I’s holding that 18 U.S.C.

§ 1348 does not require proof that the tipper of non-public information received a

personal benefit for the tip.

      The concurrence suggests that this issue was “not discussed by today’s

majority opinion because it is no longer outcome determinative” in light of the

majority’s conclusion that the confidential information at issue was neither

“property” nor a “thing of value” in the first place. Concurrence at 1. That alone

is a reason not to delve into the personal-benefits issue. “Courts are essentially

passive instruments of government” that “should not[] sally forth each day

looking for wrongs to right,” United States v. Sineneng-Smith, 140 S. Ct. 1575, 1579

(2020) (citations omitted), “decide abstract questions,” Socialist Lab. Party v.

Gilligan, 406 U.S. 583, 586 (1972), or “give opinions advising what the law would

                                          28
be upon a hypothetical state of facts,” Chafin v. Chafin, 568 U.S. 165, 172 (2013)

(internal quotation marks and alteration omitted).        Instead, the Constitution

“limit[s]” our “role” to deciding “actual cases or controversies.” Spokeo, Inc. v.

Robins, 578 U.S. 330, 337 (2016) (citation omitted).       From that constitutional

limitation springs “the cardinal principle of judicial restraint”: “if it is not

necessary to [say] more” to dispose of a case, then it generally “is necessary not to

[say] more.” Miller v. Metro. Life Ins. Co., 979 F.3d 118, 124 (2d Cir. 2020) (quoting

PDK Lab’ys v. DEA, 362 F.3d 786, 799 (D.C. Cir. 2004) (Roberts, J., concurring))

(emphasis added). There are also sound pragmatic reasons to avoid “making

pronouncements that have no consequence for the dispute”:             as one of our

colleagues has persuasively argued, “courts are more likely to exercise flawed,

ill-considered judgment, more likely to overlook salutary cautions and

contraindications, [and] more likely to pronounce flawed rules, when uttering

dicta than when deciding the[] cases” that are actually before them. Pierre N.

Leval, Judging Under the Constitution: Dicta About Dicta, 81 N.Y.U. L. Rev. 1249,

1255, 1267–68 (2006). In sum, courts are simply not free to opine on hypothetical

topics, regardless of whether those topics “warrant[] further attention by Congress

and the courts.” Concurrence at 11.

                                         29
         More importantly, the issue raised in the concurrence is, in fact, completely

outside the scope of the Supreme Court’s remand order, which vacated Blaszczak I

and remanded the case back to us “for further consideration in light of Kelly v.

United States.” Blaszczak, 141 S. Ct. at 1040. “Any reconsideration at this juncture

of our earlier opinion must be limited to the scope of the Supreme Court’s

remand.” Escalera v. Coombe, 852 F.2d 45, 47 (2d Cir. 1988). Thus, because the

Supreme       Court   specifically   “vacated   our   opinion   and    remanded     for

reconsideration in light of [Kelly],” we may “not reconsider issues that are not

directly implicated by the Supreme Court’s decision in [Kelly].” Id.; accord Robinson

v. Ariyoshi, 854 F.2d 1189, 1189–90 (9th Cir. 1988); Kotler v. Am. Tobacco Co., 981 F.2d

7, 12–13 (1st Cir. 1992); United States v. Duarte-Juarez, 441 F.3d 336, 340 (5th Cir.

2006).

         I am therefore reluctant to engage with the substance of the concurrence’s

musings on section 1348 and the asserted anomalies created by the Second

Circuit’s now vacated opinion in Blaszczak I. I respond only to address several of

the most troubling aspects of the concurrence, lest future litigants and courts

mistakenly conclude that its pronouncements are uncontested.

                                           30
      The concurrence notes that the scope of liability under Rule 10b-5 and 18

U.S.C. § 1348 differ. Under Dirks v. SEC, tipper-tippee liability under Rule 10b-5

requires evidence of a personal benefit, whereas under Blaszczak I, which has been

vacated, we held that there was no personal-benefit requirement for liability under

section 1348. 463 U.S. 646 (1983).       The concurrence finds this difference

“anomal[ous]” and troubling because, perhaps, it may be easier for the

government to criminally prosecute a defendant under section 1348 than it would

be under Rule 10b-5. Concurrence at 1. But this difference is not surprising, and

certainly not unique in American law. See, e.g., William J. Stuntz, The Pathological

Politics of Criminal Law, 100 Mich. L. Rev. 505, 600 n.62 (2001) (“[T]here are 325

separate prohibitions of fraud, misrepresentation, or both in the federal code.”)

Indeed, “[t]he Federal Criminal Code is replete with provisions that criminalize

overlapping conduct,” and so “[t]he mere fact that two federal criminal statutes

criminalize similar conduct says little about the scope of either.” Pasquantino v.

United States, 544 U.S. 349, 358 n.4. (2005). One might argue as a matter of policy

or equity that the standards under section 1348 and Rule 10b-5 should be the same.

But there is nothing in the statutes or case law that compels such a conclusion.

                                        31
      Moreover, the personal-benefit test under Rule 10b-5 is a judge-made rule

premised on the statutory purpose of the Securities Exchange Act of 1934

(the “Exchange Act”). As Dirks explained, to protect the free flow of information

into the securities markets, Congress enacted the Title 15 fraud provisions with the

limited “purpose of . . . eliminat[ing] [the] use of inside information for personal

advantage.”   463 U.S. at 662 (emphasis added and internal quotation marks

omitted). Dirks effectuated this purpose by holding that insiders could not be

prosecuted for breaching their fiduciary duties by tipping confidential information

unless they did so in exchange for a personal benefit. Id. at 662–64; see also United

States v. Chestman, 947 F.2d 551, 581 (2d Cir. 1991) (en banc) (Winter, J., concurring

in part and dissenting in part) (observing that the “Dirks rule is derived from

securities law, and . . . [is] influenced by the need to allow persons to profit from

generating information about firms so that the pricing of securities is efficient”);

United States v. Pinto-Thomaz, 352 F. Supp. 3d 287, 298 (S.D.N.Y. 2018) (Rakoff, J.)

(“Although [the Dirks personal-benefit test] was novel law, the Court reasoned

that this test was consistent with the ‘purpose of the [Title 15] securities laws . . .

to eliminate use of inside information for personal advantage.’” (quoting Dirks,

463 U.S. at 662)). Because the Dirks personal-benefit test effectuates the purpose of

                                          32
the Exchange Act, codified in Title 15, there is no obvious reason to extend that

rule to a different statutory provision under Title 18.

      While the concurrence acknowledges that “nothing in the text of

[section] 1348 requires proof of a personal benefit,” it insists that there is

something troubling about interpreting the statute to “give[] the government a

different – and broader – enforcement mechanism than is available under

[section] 10(b) and Rule 10b-5.” Concurrence at 6–7 (internal quotations omitted).

But section 1348 was passed in the wake of the 2008 financial crisis and designed

to “provide[] [f]ederal investigators and prosecutors with significant new criminal

and civil tools to assist in holding accountable those who have committed financial

fraud.” Presidential Statement on Signing the Fraud Enforcement Act of 2009,

1 Pub. Papers 689 (May 20, 2009).       The history and purpose of section 1348

therefore make it far more plausible that Congress did not intend for it to be a mere

carbon copy of the Title 15 securities-fraud statute. And since our task is merely

to ascertain the meaning of section 1348 – not to second-guess Congress’s wisdom

or motives in enacting it – we need not speculate, as the concurrence does, about

the “troubling effects” that may result from broadening the scope of criminal

                                         33
liability beyond what is provided for under section 10b and Rule 10b‐5.

Concurrence at 10 n.30. 5

                                                IV.

       For all the reasons discussed above, I respectfully dissent. I firmly believe

that the majority’s holding – that CMS’s confidential non-public information

concerning the timing and content of the agency’s reimbursement rates is not

property – is wrong and not compelled by United States v. Kelly. I also believe that

the remaining dicta in the majority and concurring opinions will lead to confusion

among litigants, lawyers, and lower courts alike. I fear that the only winners in

this appeal will be the defendants – sophisticated insiders who misappropriated

confidential government information to enrich themselves and their associated

5 In a similar vein, the majority opinion announces that “the actual and intended victims of the
alleged [insider trading scheme] would have been investors in the market for securities of the
companies whose fortunes would be affected by the regulations promulgated by . . . CMS.” Maj.
Op. at 23. That is not the case. Under either Title 15 or Title 18, investors in the market are not
the victims of insider trading; the only victim of insider trading is the entity whose non-public
information was misappropriated. See, e.g., Carpenter, 484 U.S. at 24 (“[T]he victim of the fraud
[was] the Journal, . . . not a buyer or seller of the stocks traded in or otherwise a market
participant.”); Obus, 693 F.3d at 291 (identifying the “victim” of the insider-trading scheme as the
company whose business proposal had been misappropriated); Marc I. Steinberg & Ralph C.
Ferrara, 25 Secs. Prac. Fed. & State Enforcement, App. 2F (2022) (When “the plaintiff alleged that
it was defrauded . . . by having information secretly stolen,” clearly, “the plaintiff corporation
was a victim of the defendant’s misappropriation.”). The victim here is obviously CMS –
precisely because its confidential, intangible property was misappropriated.

                                                34
hedge funds – and those like them who will be emboldened by today’s decision to

believe that the broad proscriptions of the federal fraud statutes do not in fact

mean what they say. It is clear, to me at least, that the defendants are not the

victims of prosecutorial overreach or vague statutes; they are instead the

beneficiaries of a windfall generated by a flawed legal analysis.

                                        35