The opinion of the court was delivered by: Wolfson, United States District Judge:
Presently before the Court is a Motion by Defendant Edward J. Mosberg ("Defendant" or "Mosberg") to dismiss the Second Superseding Indictment ("Indictment") pursuant to Fed. R. Crim. Pro. 12(b)(3). Mosberg, a real estate developer, is charged with the following counts, in connection with his alleged relationship with the former attorney for the Planning Board who, at times, acted as Township Attorney for Parsippany-Troy Hills ("the Attorney" or "Montefusco"): (a) conspiracy to commit honest services fraud in violation of 18 U.S.C. § 1349 (Count 1); (b) honest services fraud in violation of 18 U.S.C. §§ 1341 and 1346 (Counts 2-7); and bribery in violation of 18 U.S.C. § 666(a)(2) (Counts 8-11). Mosberg is, further, charged with aiding and abetting in Counts 2-11, in violation of 18 U.S.C. § 2.
Mosberg challenges each count of the Indictment as insufficiently plead. He, further, brings statutory and constitutional challenges to the conspiracy and honest services fraud statutes or counts. Finally, Mosberg asks the Court to conduct an in camera review of the grand jury proceedings that resulted in the instant Indictment.
After thoroughly considering the parties' initial briefing, holding oral argument, and directing the parties to submit supplemental briefing, the Court denies Defendant's motion to dismiss as to all counts, with the exception of the aiding and abetting charges linked to Counts 8-11. I, further, deny Mosberg's request for in camera review of the grand jury proceedings. The reasoning underlying my decision follows.
A. The Alleged Scheme to Defraud
The Indictment alleges that Mosberg engaged in a several-year long bribery-based honest services fraud scheme, and conspiracy to defraud, with Montefusco, the Attorney for the Parsippany-Troy Hills Planning Board ("Planning Board" or "the Board") and, at times, attorney for Parsippany-Troy Hills Township ("the Township"). As a commercial and residential real estate developer, Mosberg oversaw his development entities' business involvement with the Township, including efforts to obtain various development approvals and resolutions from the Planning Board.*fn1
Count 1, ¶¶ 1a, 1d. Mosberg was also involved in various legal disputes with the Township. Id. at ¶ 1d. These disputes revolved around several different matters,including Mosberg's affordable housing obligations to the Township and the portion of sewer and water collection fees Mosberg was required to pay to the Township. Id. The disputes involved "[m]illions of dollars in judgments, settlements, and legal fees ...." Id.
The Attorney served as the Planning Board's legal advisor, rendering advice on pending development applications and representing the Board concerning all litigation. Id. at ¶ 1e. At times, the Attorney also represented the Township concerning litigation between the Township and Mosberg. Id. at ¶ 1f. From 1996 through 2003, the Attorney served on the mediation team for the Council of Affordable Housing, which team was assembled to mediate affordable housing disputes between the Township and Mosberg, among other developers. Id. The Attorney, further, participated in settlement negotiations regarding the sewer and water fee disputes.
According to the Indictment, from 1997 through 2007, the Attorney used his position as Planning Board attorney and, at times, on behalf of the Township directly, to "assist MOSBERG with development-related business and litigation involving the Township and the Planning Board, without the public's knowledge, as specific opportunities arose." Count 1, ¶¶ 3, 4. For example, in 1998, the Attorney represented the Township in litigation involving another developer who sought to develop a residential property known as Mazdabrook. Count 1, ¶ 10c. After the Township prevailed in that litigation, "Mosberg received a secret recommendation from the Attorney that Mosberg purchase Mazdabrook and apply to build houses rather than apartments." Id. The Attorney knew that the Township would approve that type of application. Mosberg heeded the Attorney's advice and, upon receipt of the development application, the Attorney allegedly expedited its approval. See id.
In addition, the Indictment alleges that, from about 1997 through 2005, Mosberg was engaged in litigation with the Township over sewer-connection fees related to previously executed developer agreements between Mosberg and the Township. Count 1, ¶ 10a. Allegedly, the Attorney "endors[ed] developer's agreements between the Township and MOSBERG entities that undermined the Township's legal position in the litigation." Id. at ¶ 10b. The applications recommended by the Attorney supported Mosberg's method of calculating sewer-connection fees rather than that of the Township, and exempted Mosberg from the payment of any fees. Id.*fn2
Several other official actions are alleged in the Indictment. For one, the Attorney expedited development applications for Mosberg on a continuing basis. Count 1, ¶ 10c. The Attorney, further, disclosed confidential Township litigation strategy to Mosberg, to the Township's detriment. Count 1, ¶ 10d. Lastly, in 2006, Mosberg is alleged to have offered the Attorney a six-figure payment in exchange for the Attorney's official assistance in "resolving outstanding litigation and obtaining Planning Board approval to build additional housing units at Parkside Gardens," one of Mosberg's developments. Id. This transaction was never completed, however, because the grand jury's investigation became public before any payment was made. Id.
The Indictment alleges that, beginning in 2002, Mosberg engaged in favorable real estate deals with several of the Attorney's family members as a means of rewarding the Attorney for his assistance. Count 1, ¶¶ 5, 6a. These deals included, inter alia, discounted purchase prices, free property upgrades, lenient settlement dates, and the waiver of contract contingencies. Id. Certain of the properties purchased by the Attorney's family members were "flipped," i.e., purchased and then quickly resold, which resulted in a profit for the family member.
One such real estate transaction earned the participating family member a profit of $58,955, before capital gains tax. Id. at ¶ 6a(ii) ("Property #3"). According to the Indictment, Mosberg facilitated this transaction by allowing the family-member, in May of 2002, to enter into a contract to purchase the property for $275,000. That contract provided that the family-member purchaser was to close on the property "upon issuance of a certificate of occupancy ...." Id. at ¶ 5b. When the certificate of occupancy was issued in November of 2002, Mosberg did not enforce that contract provision and, instead, allowed the family-member purchaser to close three months later in February of 2003. Id. at ¶ 6a. A few months later, in June of 2003, the property was sold to a third party for $360,000, resulting in the $58,955 profit. Id.
Importantly, the Indictment further alleges that some of the Attorney's family members transferred a total of $36,000 of the sale proceeds to the Attorney's bank account. Count 1, ¶ 8. The deposits to his bank account were not directly transferred there, but were "concealed and transferred through various bank accounts held by certain members of the Attorney's family." Id. In short, the Indictment alleges that, by "allow[ing] the Family Members to successfully flip residential properties and derive substantial proceeds from their sales," Mosberg provided monies and personal benefits, both directly and indirectly, to the Attorney. Id. at ¶ 7.
Despite receipt of certain of the real estate sale proceeds, the Attorney did not disclose his relationship with Mosberg, and/or the real estate transactions involving Mosberg and the Attorney's family members, to the Township or Planning Board. Count 1, ¶ 9. He, further, failed to disclose any receipt of monies or benefits from the real estate transactions on his annual Local Government Ethics Law Financial Disclosure Statements filed in 2004 and 2007. Id.; Count 5 and 7. Under New Jersey's Local Government Ethics Law, "local government officers" must file an annual financial disclosure statement specifying "[e]ach source of income, earned or unearned, exceeding $2,000 received by the local government officer or a member of his immediate family during the preceding calendar year." N.J.S.A. 40A:9-22.6(a)(1).*fn3 In addition to disclosing income, each local government officer must also disclose "[e]ach source of gifts, reimbursements or prepaid expenses having an aggregate value exceeding $400 from any single source . . . received by the local government officer or a member of his immediate family during the preceding calendar year." Id. at (a)(3). Further, the officer must disclose "[t]he address and brief description of all real property in the State in which the local government officer or a member of his immediate family held an interest during the preceding calendar year." The Indictment alleges that the Attorney's failure to disclose on his financial disclosure forms the benefits and monies he and his children received was done in an attempt to conceal the bribery-based conspiracy. Id. at Count 1, ¶ 9.
Based on Mosberg's and the Attorney's allegedly improper relationship, and the attendant, though convoluted, exchange of monies, the Indictment asserts that Mosberg and the Attorney engaged in a scheme to defraud the Township of the Attorney's honest services. Specifically, the Indictment charges one count of conspiracy to commit honest services fraud in violation of 18 U.S.C. § 1349 (Count 1); five counts of honest services fraud in violation of 18 U.S.C. §§ 1341 and 1346 (Counts 2-7), and bribery affecting federal funds in violation of 18 U.S.C. § 666(a)(2) (Counts 8-11). As noted, Mosberg is, further, charged with aiding and abetting in Counts 2-11, in violation of 18 U.S.C. § 2.
The procedural history of this criminal proceeding is protracted and merits separate account. The Government originally indicted Mosberg on September 18, 2008, charging him with one count of conspiracy to commit honest services fraud in violation of 18 U.S.C. § 1349 (Count 1); five counts of honest services fraud in violation of 18 U.S.C. §§ 1341 and 1346 (Counts 2-7), and bribery affecting federal funds in violation of 18 U.S.C. § 666(a)(2) (Counts 8-11). The original indictment also charged him with aiding and abetting, under 18 U.S.C. § 2.
In this earlier indictment, the Attorney was primarily described as
the Planning Board Attorney or "PB Attorney." Stating that the
Attorney also worked directly for the Township in some instances, the
indictment alleged that the Attorney was appointed as "interim
Township Attorney" in 2005, and that he served in that capacity "for a
time." Indictment dated Sept. 18, 2008, Count I, ¶ 1d, 1f.*fn4
The only specific instance of the Attorney's role as interim
Township Attorney mentioned in the indictment is his alleged
representation of the Township in connection with the Township's
negotiation over Mosberg's Parkside Gardens development. Id. at ¶
The scheme to defraud was described, in the original indictment, as a scheme to defraud the Township of the Attorney's honest services "pursuant to (a) New Jersey law and (b) his state common law obligation as a fiduciary for the public ...." Indictment dated Sept. 18, 2008, Count I, ¶ 2. Based on these state law sources, the indictment asserted, the Attorney was obligated to "refrain from receiving bribes and other corrupt benefits . . . ; and [to] disclose conflicts of interest and other material information in matters over which the [ ] Attorney exercised, and attempted to exercise, official authority and discretion, that resulted in his direct and indirect personal and financial gain." Id. The indictment also alleged that Mosberg offered, though he did not ultimately give, the Attorney a six-figure corrupt payment.
Notably, two of the five honest services fraud counts under 18 U.S.C. § 1341 and § 1346 were for mailings, by the Attorney, of Local Government Ethics Law Financial Disclosure Statements. The indictment alleged, in Counts 5 and 7, that these disclosures fraudulently failed to disclose the monies and benefits that the Attorney received from Mosberg. See Indictment dated Sept. 18, 2008, Counts 2-7, ¶ 4. Specifically, the indictment asserts that it was part of the scheme for the Attorney not to disclose his receipt of monies and benefits on his disclosure forms, or to otherwise not disclose his receipt of the monies and benefits to the Planning Board. Id., Count 1, ¶ 7.
Shortly after Mosberg was indicted, he moved for a Bill of Particulars pursuant to rule 7(f) of the Federal Rules of Criminal Procedure. Through that motion, Mosberg sought "key facts, dates, and events that form the bases of the Government's claims that [he] engaged in illegal conduct." Memo of Law in Supp. of Def. Mot. for a Bill of Particulars at 2. Following an extended briefing schedule, the Court held oral argument on the motion on January 29, 2009. The Court denied Mosberg's motion based on "certain representations [made] during the hearing" by the Government, whereby the Government agreed to provide more precise dates as the Government's "preparation continue[d]." January 29, 2009 Transcript at 13:7-12; Order dated January 29, 2009.
Mosberg then filed a motion to dismiss the indictment in February 2009, arguing, inter alia, that the indictment did not allege facts constituting quid pro quo bribery. In connection with that motion, Mosberg also urged the Court to conduct an in camera review of the grand jury proceeding that resulted in the September 18, 2008 indictment. Mosberg argued, in support of his request for in camera review, that the indictment erroneously included two pages numbered "4," which each contained distinct allegations regarding the date that the Attorney was appointed as interim Township Attorney. The first page 4 stated that the Attorney was appointed "[i]n or about 2005," while the second page 4 stated that he was appointed "[i]n or about May 2006." In light of this discrepancy, Mosberg asked the Court to conduct an in camera review for the purpose of determining whether "this or any other error so infected the Grand Jury proceeding that the Indictment is defective and should be dismissed." Def. Ltr. dated Mar. 3, 2009 at 2.
Shortly thereafter, on March 26, 2009, the Government filed a Superceding Indictment. This indictment corrected the duplicate page 4 error, and removed any reference to the year during which the Attorney was appointed as interim Township Attorney. This indictment stated merely that the Attorney served as interim Township Attorney "at certain times." Superceding Indictment, Count 1, ¶ 1d. In addition, the Superceding Indictment removed the reference to the Attorney serving as interim Township Attorney in the Parkside Gardens development negotiations. In its place, the Superceding Indictment alleges that "[t[he Attorney, on certain occasions, also represented the Township in litigation in which the Township and MOSBERG development entities were parties." Id.
Apart from these changes, the Superceding Indictment mirrored the original indictment. As in the original indictment, the Superceding Indictment alleged, in Counts 5 and 7, that the Attorney failed to disclose the monies and benefits that the Attorney received from Mosberg on his local government disclosure forms. See Superceding Indictment, Counts 2-7, ¶ 4. Moreover, the Superceding Indictment contained the allegation that it was part of the overarching fraudulent scheme for the Attorney to conceal his receipt of the monies and benefits. Id., Count 1, ¶ 9.
The next month, in April of 2009, Mosberg filed another motion for a Bill of Particulars, this time for clarification of the Superceding Indictment. This motion sought details about the dates that the Attorney served as Interim Township Attorney, as well as the specific litigations in which, or development-related business for which, he served as either Planning Board or Interim Township Attorney. In this way, the Defendant sought to have the Government more clearly delineate the Attorney's role with respect to each Mosberg-related matter in the Township. The motion, further, sought the specific date in 2006 that Mosberg allegedly offered the six-figure payment to the Attorney. That same month, Mosberg filed a motion seeking in camera review of the grand jury proceedings that resulted in the original indictment. The basis for this motion was the same as that underlying the second motion for a Bill of Particulars. See Def. Notice of Mot. to have the Court Conduct In Camera Review at 2.
The Court held oral argument on the motion for a Bill of Particulars, and on the motion for in camera review, on June 1, 2009. At that hearing, the Court orally ordered the Government to identify the litigations in which the Attorney acted as an agent for the Township, the dates of the lawsuits, and the names of any other attorneys that represented the Township in those suits. The Government responded on June 16, 2009, with a table that listed seventeen lawsuits between Mosberg and the Township. See Govt. Ltr. dated June 16, 2009 at 1. For each lawsuit, the table specifies the dates of the litigations and the "other attorneys" retained by the Township. Id. at 3-4.
A letter introducing the table further explained, with respect to certain of the denoted lawsuits:
As to lawsuit Nos. 1-6, 8 and 10-15, [the Attorney] was not counsel of record but was involved on behalf of the Township from in or about 2002 to in or about June 2003 and signed a settlement agreement on March 2, 2005. As to lawsuit No. 16, [the Attorney] was counsel of record on behalf of the Planning Board. As to lawsuit No. 9, [the Attorney] was counsel of record on behalf of the Township. As to lawsuit Nos. 7 and 17, [the Attorney] was counsel of record for both the Township and Planning Board. As to lawsuit Nos. 7, 9, 16 and 17, the period of [the Attorney]'s representation was throughout the suit except that in lawsuit No. 9 [the Attorney]'s representation ended on March 7, 2007. [the Attorney] acted as an agent of the Township with respect to each of the suits in which he was involved.
The month following the June oral argument, in July of 2009, Mosberg filed a motion to dismiss the Superceding Indictment. After another round of extensive briefing, the Court held oral argument on this motion on October 14, 2009. As with the prior motion to dismiss, Mosberg argued that the Superceding Indictment failed to adequately allege a quid pro quo bribery, among other challenges to that indictment.
Importantly, while the Government interpreted Counts 5 and 7 of the Superceding Indictment as part of an overall quid pro quo bribery scheme, both Mosberg's and the Government's legal arguments treated Counts 5 and 7 as falling under a failure to disclose/conflict of interest theory of honest services fraud. As noted, Counts 5 and 7 of that indictment were rooted in the allegedly fraudulent local government ethics forms mailed by the Attorney, that failed to disclose monies or benefits he received from Mosberg. At that time, prior to the Supreme Court's decision in Skilling v. United States, 130 S.Ct. 2896 (2010), there were two theories by which it was believed that honest services fraud could be alleged: a bribery-based theory or a conflict-of-interest-based theory. Thus, Mosberg's legal challenges to Counts 5 and 7, at that time, focused on whether Mosberg had knowledge of the Attorney's mailing of fraudulent disclosure forms-not on whether such mailings could properly form the basis of an honest services fraud count.
In January of 2010, while Mosberg's motion to dismiss the Superceding Indictment was still pending, the Government petitioned the Court, with Mosberg's consent, to adjourn the proceedings pending issuance of the Supreme Court's Skilling decision. Finding that the parties' request was reasonable, the Court adjourned all pending proceedings at that time. When the Supreme Court had not issued its decision by May of 2010, the Court administratively terminated Mosberg's motion to dismiss on May 10, 2010, in order to judiciously manage its docket.
Skilling was ultimately issued on June 24, 2010, and, shortly thereafter, the Court held a conference call on July 29, 2010, with the Government and Mosberg, to address how the Government intended to proceed. As explained in more detail below, Skilling held that a public official's failure to disclose a conflict of interest could no longer serve as an independent theory of honest services fraud. See 130 S.Ct. at 2933- 34. Only bribery-based theories remained a valid means of indictment under the honest services fraud statute, 18 U.S.C. § 1346. Hence, during the conference call, and after confirming that the Government intended to pursue its prosecution of Mosberg, the Government requested additional time to decide whether it would seek to strike certain allegations and/or counts from the Superceding Indictment or whether it would return to the grand jury to seek a new indictment that took into account the Skilling ruling. Within a short period of time, the Government informed the Court that it would return to the grand jury. Govt. Ltr. dated Aug. 4, 2010. Based on communications with the parties, the Court understands that a new grand jury, different from the one that had returned the Superceding Indictment, had been empaneled by that time.
On October 14, 2010, the Government filed the Second Superceding Indictment. Mosberg then filed the instant motion to dismiss on March 25, 2011, along with another request for in camera review of the grand jury proceedings. After extensive briefing, including a request to file an over-length brief, the Court held oral argument on June 10, 2011. It became apparent at oral argument that supplemental briefing was required to address some of the Court's questions; therefore, the Court granted Mosberg and the Government additional time to file supplemental letter briefs. Now, at long last, the Court rules on Mosberg's motion to dismiss.
On a motion to dismiss, a court reviews the indictment to determine whether it:
(1) contains the elements of the offenses intended to be charged, (2) sufficiently apprise[d] the defendant of what he must be prepared to meet, and (3) allows the defendant to show with accuracy to what extent he may plead a former acquittal or conviction in the event of a subsequent prosecution.
United States v. Vitillo, 490 F.3d 314, 321 (3d Cir. 2007). An indictment may not merely recite the essential elements of the offense charged, it must allege specific facts that fall within the scope of the relevant criminal statute. Id.; United States v. Kemp, 500 F.3d 257, 280 (3d Cir. 2007). All facts alleged in the indictment must be taken as true, and the court is to employ a "common sense construction" thereof. United States v. Hodge, 211 F.3d 74, 76 (3d Cir. 2000).
In United States v. Bergrin, 650 F.3d. 257 (3d Cir. 2011), the Third Circuit recently affirmed the limited scope of the court's inquiry on a motion to dismiss. The Court of Appeals reiterated that, "[w]hile detailed allegations might well have been required under common-law pleading rules, ... they surely are not contemplated by Rule 7(c)(1)." Id. at 264 (quoting United States v. Resendiz--Ponce, 549 U.S. 102, 110 (2007)). The court, further, emphasized that although courts "may look for more than a mere 'recit[ation] in general terms [of] the essential elements of the offense, . . . [a] ruling on a motion to dismiss is not . . . a permissible vehicle for addressing the sufficiency of the government's evidence." Id. at 264-65 (citations omitted). Indeed, "no greater specificity than the statutory language is required so long as there is sufficient factual orientation to permit the defendant to prepare his defense and to invoke double jeopardy in the event of a subsequent prosecution." Id. at 264 (quoting United States v. Rankin, 870 F.2d 109, 112 (3d Cir. 1989)). According to the Bergrin court, this is a "narrow, limited analysis geared only towards ensuring that legally deficient charges do not go to a jury." Id. at 268.
Bergrin further clarified language from U.S. v. Panarella, 277 F.3d 678 (3d Cir. 2002), that an indictment based on facts "beyond the reach of the relevant criminal statute" fails to state an offense. Bergrin, 650 F.3d at 264-65. The Bergrin court expressly noted that Panarella has been taken out of context by courts to inappropriately imply that a court may "inquir[e] into what the Government will be able to prove at trial" in the context of a motion to dismiss an indictment. Bergrin, 650 F.3d at 271. Hence, Bergrin makes clear that, although an indictment fails to state an offense if the facts alleged fall beyond the scope of the criminal statute "as a matter of statutory interpretation," id. at 264-65, no deeper inquiry into the veracity or evidentiary value of the indictment's allegations is permitted.
Mosberg challenges each count of the Indictment as insufficiently pled. His primary argument is that the Indictment does not plead a quid pro quo bribery theory of honest services fraud. He further argues that Counts 5 and 7 of the Indictment, which are rooted in the Attorney's failure to disclose the monies and benefits he received from Mosberg on his local government ethics disclosure forms, constitute an impermissible, back-door attempt by the Government to charge him on the failure to disclose theory of honest services fraud rejected by Skilling. The Government, in contrast, argues that the Indictment adequately charges a quid pro quo bribery theory, and that Counts 5 and 7 are mailings, like any other, that further the bribery scheme.
Mosberg makes additional arguments as to the other counts of the Indictment, but I address these heavily-debated challenges first before turning to his remaining arguments.
As an initial matter, and to provide context for my discussion, I first clarify the scope of the Indictment as a whole. The Indictment cites to both the general mail fraud statute, 18 U.S.C. § 1341, and the honest services fraud statute, 18 U.S.C. § 1346. Section 1341 reaches money-and-property based fraud, whereas section 1346 reaches fraud based on the deprivation of a public official's honest services.
While both statutes are cited in the Indictment, it is clear from the Indictment's description of the object of the conspiracy that only honest services fraud is charged. As explained by the Third Circuit in Riley, it is the object of the scheme that determines whether a given scheme alleges general mail fraud or honest services fraud. See 621 F.3d at 327 ("to distinguish between the fraud of §§ 1341 and [18 U.S.C. § 666], as opposed to that of § 1346, one must look to the object of the deprivation and not the underlying fraudulent act."). So, allegations that a bribery scheme resulted in financial loss to a township would constitute money and property-based fraud under section 1341.*fn5 See id. at 327. The Indictment here alleges that "MOSBERG . . . devise[d] a scheme and artifice to defraud the Planning Board, the Township and its citizens of the right to the Attorney's honest services . . . , contrary to . . . Sections 1341 and 1346." Counts 2-7, ¶ 2 (emphasis added). The Indictment makes no reference to the deprivation of money or property. Thus, I conclude that the only scheme alleged is that of honest services fraud and not money-or-property mail fraud under section 1341. With the scope of the Indictment clarified, I now turn to the parties' arguments.
A. The Bribery Theory - Quid Pro Quo Agreement
With respect to Counts 2-7 of the Indictment, which counts charge violations of the honest services fraud statute, 18 U.S.C. § 1341, Mosberg contends that the Indictment fails to allege a "quid pro quo " bribery scheme consistent with Skilling and with pre-Skilling case law. The Indictment alleges that Mosberg "knowingly and willfully did devise and intend to devise a scheme and artifice to defraud the Planning Board, the Township and its citizens of the right to the Attorney's honest services ...." Indictment, Counts 2-7, ¶ 2-3. As for the bribery allegations, the Indictment states that Mosberg "g[a]ve the Attorney . . . a stream of concealed bribes . . , often in the form of favorable real estate transactions, in exchange for the Attorney exercising . . . official authority . . . to assist MOSBERG ...." Indictment, Counts 2-7, ¶ 3 (emphasis added). The Indictment, further, alleges that there was an express agreement in 1998, with respect to Mazdabrook, and a general bribe in 2006.*fn6
Relying primarily on U.S. v. Kemp, 500 F.3d 257 (3d Cir. 2007), Mosberg argues that the Government must allege an explicit or implicit agreement, i.e., that Mosberg and the Attorney agreed that the former would provide real estate deals to the latter's children in exchange for favorable treatment. In Mosberg's words, "there [must] be a two-way agreement involving a promise or commitment from the public official to perform official acts in exchange for a promise or commitment that the official will receive a thing of value." Def. Mov. Br. at 12.
As Mosberg correctly argues, the Kemp Court held that "the quid pro quo requirement is satisfied so long as the evidence shows a course of conduct of favors and gifts flowing to a public official in exchange for a pattern of official actions favorable to the donor." 500 F.3d at 282. Applying that rule of law to the instant Indictment, Mosberg finds it deficient, arguing that the Indictment alleges only a "quid" and "quo" but no "pro." Def. Mov. Br. at 14. Specifically, Mosberg argues that the Indictment merely states that he gave favorable real estate deals to the Attorney's children (the quid) and that the Attorney provided favorable treatment to him (the quo). Nowhere in the Indictment, Mosberg argues, is the allegation that Mosberg and the Attorney agreed, implicitly or explicitly, to benefit each other in this manner. Without an allegation of this sort of agreement, Mosberg contends, the Indictment is insufficient as a matter of law.
Contrary to Mosberg's assertion, Kemp does not support his argument. For one, the indictment language approved by the Kemp court mirrors that found in the instant Indictment. In ruling that the indictment sufficiently alleged a bribery theory, the Kemp Court quoted the following language from that indictment:
The indictment refers to "the benefits that HOLCK and UMBRELL extended to Kemp with the intent to influence KEMP's official actions," and charges that "defendants GLENN K. HOLCK and STEPHEN M. UMBRELL, on behalf of their employer, Commerce Bank, provided benefits to Kemp in the form of otherwise unavailable loans in exchange for favorable decisions by KEMP as Treasurer of Philadelphia."
Id. at 280-81. According to Kemp, "[t]hese allegations were sufficient to charge Holck and Umbrell with honest services fraud under a bribery theory ...." The only difference between the Kemp indictment language and the Indictment here is that there is no express allegation that Mosberg had the "intent to influence" Montefusco. Indeed, Mosberg concedes that the 2006 allegation, on its own, sufficiently alleges a quid pro quo arrangement, which allegation does not include the "intent to influence" language. See Indictment, Count 1, ¶ 10d ("MOSBERG offered the Attorney a 'six-figure' bribe payment in exchange for the Attorney's official assistance ....") (emphasis added).
In addition, the Third Circuit sanctioned the "in exchange for" language as evincing an "intent to influence" in its recent decision in United States v. Bryant, 655 F.3d 232 (3d Cir. 2011). In Bryant, the Third Circuit explained: The Supreme Court has explained that, as "[b]ribery requires intent 'to influence' an official act or 'to be influenced' in an official act ..., there must be a quid pro quo-a specific intent to give or receive something of value in exchange for an official act." 655 F.3d 232 at *5 (emphasis added) (quoting United States v. Sun--Diamond Growers, 526 U.S. 398, 404--05, 119 S.Ct. 1402, 143 L.Ed.2d 576 (1999) (emphasis in original)). See also Beldini, 2011 WL 3890964 at *2 (using "in exchange for" to describe quid pro quo bribery allegations required under section 666). As I explained in my lower court decision in Bryant, "the Indictment's allegation of an 'exchange' necessarily signifies that [the public official] accepted the bribe . . . with the intent to be influenced in the official actions listed in the Indictment." 556 F.Supp.2d at 390-91 (citing Sun-Diamond, 526 U.S. at 404-05). Cf. U.S. v. Bahel, --- F.3d ---, 2011 WL 5067095 at *19 (2d Cir. 2011) (holding that "in return for" language in jury instructions sufficiently communicates the quid pro quo element).
Furthermore, the Indictment here satisfies the motion to dismiss standard reaffirmed by the Third Circuit in Bergrin. As noted, on a motion to dismiss, the court's analysis must center on whether the indictment (1) contains the elements of the offenses charged, (2) sufficiently apprised the defendant of what he must defend against, and (3) "allows the defendant to show with accuracy to what extent he may plead a former acquittal or conviction in the event of a subsequent prosecution." Id.
The Indictment alleges the elements of honest services fraud, and apprises Mosberg of the sort of bribery scheme that he must defend against-favorable real estate deals in exchange for expediting or favorably resolving Planning Board matters and Township litigation. In this way, the Indictment also gives Mosberg sufficient factual orientation to defend against any attempt by the Government to subsequently indict him for the same crime. The Court understands that Mosberg would prefer more detailed factual allegations, however, the Government is not obligated to provide those details at this juncture. If the Government is unable to support its theory through facts adduced at trial, then the sufficiency of the Government's proofs may be considered on the basis of that record. Therefore, with similar language-in exchange for-being approved by Kemp, and Bryant, and in light of Bergrin's admonition that detailed allegations are not contemplated by Rule 7(c)(1), 650 F.3d. at 264, I conclude that the Indictment sufficiently alleges a quid pro quo bribery.
In a related argument, Mosberg appears to rely on U.S. v. Inzunza, 638 F.3d 1006 (9th Cir. 2011), for the proposition that an express agreement is required, thereby suggesting that the Indictment is deficient for failing to allege that Mosberg and Montefusco entered into an explicit bribery agreement.*fn7 However, in his reply, Mosberg clarifies that Inzunza is cited solely for the proposition that an indictment "cannot rely on suspicion alone to establish a link between the alleged benefits conferred to Montefusco and the alleged favorable official treatment furnished by Montefusco." Def. Reply at 6 n.3. As an initial matter, Inzunza involved a sufficiency of the evidence challenge. Moreover, the Inzunza court's full comment was "[s]uspicion alone will not support criminal liability; on this record, a rational juror would entertain reasonable doubts that preclude a finding of guilt on the counts in question." Id. (emphasis added). Needless to say, this is not the standard applicable on a motion to dismiss.
The Third Circuit's recent affirmance of Bryant, further supports my conclusion that a quid pro quo arrangement has been alleged, and that a bribery agreement may be implicit as opposed to explicit in nature. In Bryant, former New Jersey state senator Wayne Bryant was charged with entering into a bribery scheme with R. Michael Gallagher, the former Dean of the School of Osteopathic Medicine ("SOM") of the University of Medicine and Dentistry of New Jersey ("UMDNJ"). The indictment in that case, as concisely explained by the Bryant court, "alleged [a] quid pro quo arrangement in which Gallagher gave Bryant a 'low-show' job at SOM (meaning he provided only minimal or nominal services) as a 'Program Support Coordinator,' in which position he received an annual salary of $35,000 (and a $5,000 bonus), in exchange for Bryant's efforts as Chairman of the Senate Appropriations Committee to funnel State funding to SOM." Id. at *1. Both Bryant and Gallagher were convicted for their roles in the bribery scheme.
On appeal, the Third Circuit approved the following lower court jury instruction that acknowledged implicit quid pro quo agreements. The jury instruction provided:
The evidence of a quid pro quo can be implicit, that is, a conviction can occur if the Government shows that [the defendant] accepted payments or other consideration with the implied understanding that he would ...