United States v. Feng Tao

107 F.4th 1179

UNITED STATES of America, Plaintiff - Appellee, v. Feng TAO, Defendant - Appellant.

No. 23-3013

United States Court of Appeals, Tenth Circuit

FILED July 11, 2024

Appeal from the United States District Court for the District of Kansas (D.C. No. 2:19-CR-20052-JAR-1)

Michael F. Dearington (Peter R. Zeidenberg with him on the briefs) of ArentFox Schiff LLP, Washington, D.C., for Defendant-Appellant.

Joseph P. Minta, Attorney, Appellate Unit, National Security Division, U.S. Department of Justice, Washington, D.C. (Kate E. Brubacher, United States Attorney for the District of Kansas; Matthew G. Olsen, Assistant Attorney General for National Security, with him on the brief), for Plaintiff-Appellee.

Before TYMKOVICH, BRISCOE, and MORITZ, Circuit Judges.

MORITZ, Circuit Judge.

From 2014 until his arrest in 2019, Feng "Franklin" Tao was a tenured professor at the University of Kansas (KU). During his employment, Tao conducted research funded by two federal agencies—the U.S. Department of Energy (DOE) and the National Science Foundation (NSF). At the same time, he developed a relationship with a university in China and concealed it from KU. As a result, Tao found himself facing ten federal charges and now stands convicted by a jury of one crime: making a materially false statement in a matter within the jurisdiction of the executive branch, in violation of 18 U.S.C. § 1001(a)(2). Because we agree with Tao that the government offered insufficient evidence for a rational jury to find that his statement to his employer was material to any DOE or NSF decision, we reverse Tao's conviction and remand for the district court to enter a judgment of acquittal.

Background

This case began as an espionage investigation. A visiting scholar at KU was angry with Tao over an authorship dispute and threatened to report him as a "tech spy" to the FBI if he refused to pay her $300,000, noting that this kind of espionage "was a popular topic these days with the FBI." App. vol. 11, 2336. When Tao ignored her demand, the scholar made good on her threat—she submitted an anonymous tip to the FBI accusing Tao of economic espionage and later impersonated others to make additional espionage allegations. As a result, the FBI launched an espionage investigation.

In the end, the FBI found no evidence of espionage. But the FBI learned that Tao had potentially accepted a second full-time professorship at Fuzhou University in China and hid it from KU. For this conduct, the government charged Tao with three counts of making false statements, in violation of 18 U.S.C. § 1001(a)(2), and seven counts of wire fraud, in violation of 18 U.S.C. § 1343. The false-statement counts alleged that Tao concealed his relationship with Fuzhou University in certain documents, including, as relevant to this appeal, an annual institutional-responsibilities form that he submitted to KU in September 2018. The wire-fraud counts alleged that by failing to disclose his relationship with Fuzhou University, Tao defrauded KU of his salary and the DOE and the NSF of federal grant funds. Before trial, Tao twice moved to dismiss the indictment. The district court denied both motions, and the government then voluntarily dismissed one false-statement count and one wire-fraud count.

In March 2022, Tao proceeded to trial on the remaining eight counts. The government's case-in-chief spanned almost two weeks, involved over 30 witnesses, and included nearly 400 exhibits. The evidence at trial showed that Tao was a tenured associate professor in KU's departments of chemistry and chemical and petroleum engineering. When he joined the KU faculty in 2014, Tao brought with him a research grant from the NSF. A few years later, in October 2017, KU submitted a grant proposal to the NSF seeking funding to support another of Tao's research projects. And in December 2017, KU submitted a renewal proposal to the DOE requesting funding for Tao to continue a DOE-funded research project beyond the initially approved period.¹ Both agencies awarded the funds the next year. Throughout his time at KU, Tao focused his research on catalysis, which concerns changes in the rates of chemical reactions, and published prolifically in respected scientific journals.

As a KU employee, Tao's responsibilities included following all university policies, including the Commitment of Time, Conflicts of Interest, Consulting, and Other Employment Policy—a policy developed "to conform to [f]ederal regulations governing research."² App. vol. 12, 2686. This conflict policy requires, among other things, that faculty members annually submit an institutional-responsibilities form, which in turn instructs faculty members to report their "significant financial interests" and "time commitments in external professional activities." Id. at 2728 (capitalization standardized). The form also requires faculty members to "report any changes . . . as soon as they become known . . . and no later than 30 days after acquiring a new significant financial interest." Id. at 2732. According to KU's assistant vice chancellor for research, institutional-responsibilities forms are "internal documents at KU" and are never "sent off to agencies," but KU uses the information disclosed on them when helping researchers prepare grant proposals. App. vol. 4, 793.

In July 2017, Tao applied to become a Changjiang Distinguished Professor at Fuzhou University under the Changjiang Scholar program, a prestigious Chinese talent-recruitment program sponsored by China's Ministry of Education. By January 2018, the Ministry of Education had named Tao a Changjiang Scholar. Fuzhou University then sent Tao a draft employment contract for a five-year, full-time appointment as a Changjiang Distinguished Professor at the university.

But given his full-time appointment at KU, the prospect of working full-time at Fuzhou University presented a problem for Tao. Seeking a solution, Tao called a colleague at another university and asked if it would be "feasible" to shift to a part-time appointment at KU so that he could accept the Fuzhou University position. App. vol. 15, 3331. The colleague suggested that Tao discuss the issue with KU, and Tao acknowledged that if he didn't "say anything, then . . . it would definitely be problematic if this thing were ever looked into." Id. at 3332. Tao also turned to a KU colleague for advice, but he framed his dilemma as involving a potential position at a German university and asked if "there [was] such a thing as . . . a half-half appointment" that would allow him to work at both universities. Id. at 3353. The colleague suggested that Tao obtain a course buyout from KU, which would provide a semester's release from his KU teaching responsibilities and free him to travel and work abroad. But if Tao wanted "to do half-and-half," the colleague cautioned, he should discuss the issue with his department chair. Id. at 3356.

Despite this advice, Tao continued considering the offer and did not disclose it to KU. Over the next few months, Tao and Fuzhou University exchanged draft employment contracts and related documents. In early May, Tao took a three-day trip to China. The day before his flight, Fuzhou University sent Tao another draft contract, which provided that in exchange for five years of full-time teaching and research, Fuzhou University would pay Tao an annual salary, supply laboratory space, allocate funds for scientific equipment, and provide him a residence on campus. That same month, Tao received a certificate from the Chinese Ministry of Education certifying his appointment as a Changjiang Distinguished Professor at Fuzhou University. But the government introduced no direct evidence that Fuzhou University and Tao ever finalized an employment contract.

Throughout the spring and into the summer of 2018, Tao tried to set up a research team and laboratory at Fuzhou University. For example, he recruited graduate and postdoctoral students to join his team; helped a postdoctoral researcher on his KU research team receive a job offer from Fuzhou University; and directed this researcher to obtain price quotes from various vendors for laboratory equipment. Tao also prepared grant applications seeking research funding in China.

In June 2018, Tao obtained a course buyout at KU for the 2019 spring semester, purportedly to focus on research. And in September 2018, Tao submitted his annual institutional-responsibilities form for 2019—the form at the heart of this appeal. He left the disclosures section blank, making no mention of Fuzhou University:

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App. vol. 12, 2730. By submitting the form to KU, Tao certified that his "report of significant financial interests and time commitments . . . [was] a true, correct, and complete statement" and that he had complied with KU's conflict policy. Id. at 2732. Tao then flew to China in December 2018 and spent most of his time there until his arrest in August 2019. Upon his arrest, KU placed Tao on administrative leave, and the NSF and the DOE suspended the research grants.

At the close of the government's case, Tao moved for a judgment of acquittal, which he renewed after he presented his own case. See Fed. R. Crim. P. 29(a). The district court reserved ruling on both motions and submitted the case to the jury. After deliberating for nearly two days, the jury returned a split verdict, finding Tao guilty on three wire-fraud counts and one false-statement count but not guilty on the other four counts. Tao then again renewed his motion for acquittal, which the district court granted in part and denied in part. The district court acquitted Tao on the three wire-fraud counts, holding that the government failed to prove Tao engaged in a fraudulent scheme to deprive KU, the NSF, or the DOE of money or property. But it concluded that the government introduced enough evidence to support the one false-statement conviction based on the institutional-responsibilities...