Opinion
20-10273 20-10274 20-10279
09-26-2022
UNITED STATES OF AMERICA, Plaintiff-Appellee, v. DANIEL WU, AKA David Wu, Defendant-Appellant. UNITED STATES OF AMERICA, Plaintiff-Appellee, DANIEL WU, Plaintiff-Appellant. UNITED STATES OF AMERICA, Plaintiff-Appellee, v. JENNIFER YANG, AKA Cheng Hua, Defendant-Appellant.
NOT FOR PUBLICATION
Argued and Submitted September 1, 2022 San Francisco, California
Appeal from the United States District Court for the Northern District of California D.C. Nos. 5:16-cr-00335-LHK-1, 5:16-cr-00334-LHK-2, 5:16-cr-00334-LHK-1, 5:16-cr-00334-LHK Lucy H. Koh, District Judge, Presiding
Before: W. FLETCHER, BYBEE, and VANDYKE, Circuit Judges.
MEMORANDUM [*]
Daniel Wu and Jennifer Yang appeal (1) the denial of a motion to dismiss the superseding indictment; (2) the jury instructions regarding visa fraud; (3) the jury instructions regarding mail fraud; (4) the sufficiency of the evidence supporting their convictions; and (5) the district court's calculation of their sentences relating to their convictions of visa fraud, mail fraud, and conspiracy to commit visa fraud, mail fraud, aggravated identity theft, and to defraud the United States. We have jurisdiction under 28 U.S.C. § 1291, and we affirm.
The parties are familiar with the facts in this case, and we repeat them only as necessary.
1. The district court did not abuse its discretion in upholding the superseding indictment. See United States v. Bracy, 67 F.3d 1421, 1426 (9th Cir. 1995) (explaining that the standard of review for a motion to dismiss for pre-indictment delay is abuse of discretion).
The statute of limitations for noncapital offenses requires that the indictment be "found" within five years of the offense. 18 U.S.C. § 3282(a). For a properly sealed indictment, "the indictment is deemed found . . . when it is returned, rather than when it is unsealed." Bracy, 67 F.3d at 1426 . And an indictment is properly sealed when "legitimate prosecutorial objectives" justify the sealing. Id.
The government established legitimate prosecutorial objectives for sealing the indictment for Wu. The government explained that it needed secrecy to ascertain whether any EB-5 investors were co-conspirators or victims in Wu and Yang's fraudulent scheme. In addition, Yang had significant foreign contacts, and an open indictment could have encouraged Wu and Yang to flee the country. The government also explained that it diligently pursued its investigation during the sealed period. The district court considered these factors at length and concluded that legitimate prosecutorial objectives justified the sealing.
Wu alone challenges the timeliness of the indictment.
In addition, the district court did not abuse its discretion in finding that the superseding indictment related back to Wu's initial indictment. When the "original indictment g[ives] the defendant sufficient notice of the charges in the superseding indictment," the two indictments are "substantially similar" and the statute of limitations is tolled. United States v. Dohrmann, 103 F.3d 141 (9th Cir. 1996). And in the event of an ongoing scheme, the government may charge a single scheme "even when several acts in furtherance of the scheme fall outside the statute of limitations." United States v. Holden, 806 F.3d 1227, 1232 (9th Cir. 2015).
Here, the superseding indictment continued to toll the statute of limitations because it contained almost identical charges to those in Wu's initial indictment, which charged Wu with visa fraud, mail fraud, and aggravated identity theft for conduct that occurred in August 2011. The statute of limitations continued to be tolled because the only new charges, conspiracy and money laundering, were part of the same pattern of conduct that gave rise to the initial indictment.
2. The district court did not err in instructing the jury on the knowledge requirement for visa fraud. We review whether a trial court's jury instructions correctly stated elements of a crime de novo. United States v. Miller, 953 F.3d 1095, 1101 (9th Cir. 2020).
The federal visa fraud statute states that anyone who "knowingly makes under oath, or as permitted under penalty of perjury . . . knowingly subscribes as true, any false statement with respect to a material fact in any application, affidavit, or other document required by the immigration laws or regulations" commits visa fraud. 18 U.S.C. § 1546(a). In Rehaif v. United States, 139 S.Ct. 2191 (2019) the Supreme Court held that the federal firearms statute required knowledge of possession of a firearm and knowledge of unlawful presence in the United States. Id. 2195. However, Rehaif explained that the presumption of a knowledge requirement only applies when a subsequent element "criminalize[s] otherwise innocent conduct." Id. at 2196. Thus, Rehaif did not extend the knowledge requirement to every subsequent element of a criminal statute.
The phrase "with respect to a material fact" in the visa fraud statute is not an element that separates innocent from guilty conduct. The wrongfulness of fraud does not turn on whether the statement was material or immaterial-that portion of the statute simply describes the seriousness of the statement required. What makes a fraudulent statement wrongful is its falsity. Thus, 18 U.S.C. § 1546(a) properly requires knowledge of falsity to separate innocent falsehoods from fraudulent (and criminal) ones. In addition, the phrase "with respect to a material fact" is "not the object of the sentence but an adverbial prepositional phrase." See United States v. Price, 980 F.3d 1211, 1220 (9th Cir. 2019) (explaining that 18 U.S.C. § 2244(b) does not require knowledge in "an adverbial prepositional phrase" that was not a separate element of the crime). To extend a knowledge requirement to materiality would contravene the grammatical structure of the statute and stretch Rehaif past the breaking point.
3. The district court's jury instructions regarding the intent for mail fraud did not constitute reversible error. We review an argument not raised below for plain error, even when "'a solid wall of circuit authority' would have rendered any objection futile at the time of trial." United States v. Johnson, 979 F.3d 632, 636 (9th Cir. 2020) (quoting United States v. Keys, 133 F.3d 1282, 1284, 1286-87 (9th Cir. 1998) (en banc)). Plain error requires a showing that the error affected the defendants' substantial rights. United States v. Bautista, 989 F.3d 698, 701-02 (9th Cir. 2021).
We have required the deceive-and-cheat instruction for other federal fraud statutes, including wire fraud, United States v. Miller, 953 F.3d 1095, 1103 (9th Cir. 2020), cert. denied, 141 S.Ct. 1085 (2021), and defrauding access devices, United States v. Saini, 23 F.4th 1155, 1160 (9th Cir. 2022). However, we have also held that the erroneous deceive-or-cheat instruction constitutes harmless error when the jury would have convicted the defendants under either jury instruction. See Saini, 23 F.4th at 1165-66 ; Miller, 953 F.3d at 1103.
Wu and Yang cannot establish that their substantial rights were affected because the record clearly shows that Wu and Yang did intend to deceive and cheat investors. Wu and Yang used the EB-5 visa system to induce investors to make substantial investments in Yang's companies. Wu and Yang then falsified immigration and employment documents, and diverted the funds away from lawful business purposes and into their own coffers. Wu and Yang's improper use of EB-5 investment money for personal gain shows that they intended to cheat investors out of the lawful use of their funds.
4. Substantial evidence supports Wu and Yang's conviction for visa fraud. We review de novo the sufficiency of the evidence. United States v. Hong, 938 F.3d 1040, 1047 (9th Cir. 2019).
The federal visa fraud statute requires that defendants make a false statement in documents "required by the immigration laws or regulations." 18 U.S.C. § 1546(a). And we have held that evidence supporting a visa petition is sufficient for purposes of a visa fraud conviction. United States v. Matsumaru, 244 F.3d 1092, 1104-05 (9th Cir. 2001) a "letter in support of [a] visa petition" qualified as a required document under § 1546(a)).
The record clearly shows that Wu and Yang made false statements in "required" documents. At the I-829 phase, the EB-5 process requires evidence to establish that the investment created "ten full-time jobs for qualifying employees." 8 C.F.R. § 216.6(a)(4)(iv). Wu and Yang fulfilled this requirement by submitting false I-9 employment forms and false IRS Form 941 forms. I-9s typically accompany an I-829 petition for EB-5 investors. And for Wu and Yang's investors, these two documents were "required" because they provided the only documentation supporting the investors' EB-5 visa applications when they were received by USCIS.
5. The district court did not abuse its discretion in applying a four-level sentencing enhancement under Sentencing Guideline § 2L2.1(b)(3). See United States v. Peterson, 902 F.3d 1016, 1022 (9th Cir. 2018) (application of the Sentencing Guidelines to the facts is reviewed for abuse of discretion) (citation omitted).
The district court applied Sentencing Guideline § 2L2.1 to both Wu and Yang because they "knew, believed, or had reason to believe that a passport or visa was to be used to facilitate the commission of a [non-immigration] felony offense." U.S. Sent'g Guidelines Manual 2L2.1(b)(3). Wu and Yang used passports and visas to facilitate at least one additional non-immigration felony. Temporary visas secured at the I-526 stage facilitated the commission of mail fraud. Because of these successful EB-5 petitions, two investors gave Wu and Yang additional investments, facilitating mail fraud. For this reason, the district court found that Wu and Yang knew, believed, or had reason to believe that a visa was used to facilitate a non-immigration felony. Further, the district court explained at Wu's sentencing hearing that passports were also used to facilitate conspiracy to commit mail fraud and actual mail fraud, because fraudulent I-9 forms were used in furtherance of the investor fraud scheme.
We find no error in the district court's judgment. Accordingly, the judgment is AFFIRMED.
[*] This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3.