In United States v. Shen Zhen New World I, LLC, --- F.4th ---, No. 23-972 (9th Cir. 2024), the Court affirmed a real estate development company’s convictions on three counts of honest services mail and wire fraud, in violation of 18 U.S.C. §§ 1341, 1343, 1346; one count of federal-program bribery, in violation of 18 U.S.C. § 666(a)(2); and four counts of interstate and foreign travel in aid of racketeering, in violation of the Travel Act, 18 U.S.C. § 1952(a)(3).
This case revolves around a pay-to-play scheme between a real estate developer and a former LA Councilmember. The developer remains a fugitive in China, so the case went to trial solely against his company.
First, the Court rejected the defendant's sufficiency challenge. It held that, when based on bribery, a conviction for honest-services fraud requires proof of the bribe-giver’s intent to enter a quid pro quo. But the bribery offense does not require an agreement to enter a quid pro quo with the public official when the defendant is the bribe-giver. A defendant offering a benefit to a public official with the intent to influence any official act in exchange suffices.
Second, the Court rejected the defendant's challenge to the district court's refusal to provide certain jury instructions on quid pro quo and specified official acts.
Third, the Court affirmed the defendant's Travel Act convictions. The defendant argued that California’s bribery statutes are too broad to serve as federal bribery predicates under the “categorical approach” required under the Travel Act. The Court determined that, as construed by the California courts, bribery under California law is broader than the Travel Act’s generic definition of bribery. But the mismatch between the generic definition of bribery and California bribery statutes do not require vacating Shen Zhen’s convictions because the jury convicted Shen Zhen based on elements that conform to the generic definition of bribery under the Travel Act.
[Of note, there is something about the Court's application of the categorical approach on this issue that seems off to me, but I need to review the case again to figure out what. If anyone comes up with the answer, please let me know].
Fourth, the Court held that the district court properly admitted evidence of the councilmember's general-pay-to-play scheme.
Finally, the Court held that the district court wrongly excluded as inadmissible hearsay the developer's alleged statements about his state of mind regarding his gift-giving.
As the parties acknowledge, defense counsel sought to elicit Huang’s out-of-court response to Zheng that Huang thought he and Huizar “were just having fun,” “not doing anything wrong,” and that he “had not asked . . . Huizar for anything.” Had Zheng been able to offer this testimony, it would have been probative not as to the truth of these statements but whether Huang felt culpable in his interactions with Huizar. Although Zheng could not testify as to the factual basis for Huang’s mindset, at least some of the excluded statements were probative of Huang’s “then-existing state of mind” and “mental feeling” about his actions—admissible as an exception to the rule against hearsay.
The Court concluded, however, that the error was harmless.
