United States v. McBride

94 F.4th 1036

UNITED STATES of America, Plaintiff - Appellee, v. Whitney MCBRIDE, and Odyssey International, Inc., Defendant - Appellants.

No. 22-4119

No. 22-4122

United States Court of Appeals, Tenth Circuit

FILED March 5, 2024

Appeals from the United States District Court for the District of Utah (D.C. No. 2:20-CR-00287-DBB)

Matthew R. Lewis, Kunzler Bean & Adamson, PC, Salt Lake City, Utah, for Defendant-Appellant.

Nathan H. Jack, Assistant United States Attorney (Trina A. Higgins, United States Attorney, with him on the brief), Office of the United States Attorney, Salt Lake City, Utah, for Plaintiff-Appellee.

Before EID, SEYMOUR, and KELLY, Circuit Judges.

SEYMOUR, Circuit Judge.

Whitney McBride was tried and convicted for five offenses based on fraudulent conduct in obtaining a government contract via her company Odyssey International Inc. ("Odyssey") to service the Army base at Fort Drum, New York. On appeal, McBride argues that her convictions for conspiracy, wire fraud, and major fraud should be vacated based on Ciminelli v. United States, 598 U.S. 306, 143 S.Ct. 1121, 215 L.Ed.2d 294 (2023), which was decided by the Supreme Court after her conviction. She further argues her conviction for making a false declaration should be vacated due to errors in the jury instructions. Because of McBride's numerous procedural errors, we affirm.

Background

In 2011, Whitney McBride and Odyssey won a $99 million government contract servicing the Army base at Fort Drum. To bid on and win the contract, however, Odyssey was required to be HUBZone-eligible.¹ Odyssey was not. Undeterred, McBride made it appear as though Odyssey was HUB Zone-eligible by cooking the books and fudging the numbers.

McBride's fraudulent practices did not go unnoticed by the losing bidders, who submitted bid protests against Odyssey. To defeat an allegation of common ownership between Odyssey and the incumbent contractor, Cadence, McBride submitted a letter to the Small Business Administration denying any relationship between Odyssey and Patrick Hendrickson, an attorney serving as Cadence's CAO who had done prior work for Odyssey on another bid. Odyssey subsequently defeated the bid protests and began work.

Federal agents eventually investigated Odyssey and McBride, uncovering their fraud. In August 2020, Odyssey and McBride were indicted for conspiracy to commit wire fraud, wire fraud, and major fraud against the United States. When prosecutors sought to interview Hendrickson as part of their investigation, McBride filed a declaration claiming that her prior letter denying an attorney-client relationship between Odyssey and Hendrickson was false and that Hendrickson had been an attorney for Odyssey.² This led the government to bring an additional charge against McBride for making a false declaration before a court.³

The case proceeded to trial where the parties proposed joint jury instructions. Relevant here, the district court adopted, without alteration, the language proffered by McBride and the government defining a "scheme to defraud" under Count II. The parties could not agree on the instruction for Count V for making a false declaration, however. McBride sought to add language instructing the jury on the substantive law of attorney-client relationships. The government sought to exclude that language. The court ultimately declined to add McBride's proposed language. It reasoned that whether there was an attorney-client relationship between Odyssey and Hendrickson was immaterial because Count V alleged McBride had made a false statement about her belief regarding whether an attorney-client relationship existed. McBride and Odyssey were convicted on all counts. This timely appeal followed.

Eleven months after the convictions of McBride and Odyssey the Supreme Court decided Ciminelli. There, the Court held that the Second Circuit's "right to control" theory of fraud was an invalid basis for liability under 18 U.S.C. § 1343. Ciminelli, 598 U.S. at 309, 143 S.Ct. 1121. "Because 'potentially valuable economic information' 'necessary to make discretionary economic decisions' is not a traditional property interest," the Court instructed, "the right-to-control theory is not a valid basis for liability under § 1343." Id.

Discussion

McBride contends her convictions on Counts I, II and III should be vacated because Ciminelli required the jury to be instructed that federal fraud statutes only protect "traditional property interests." Pointing to Ciminelli, McBride now attempts to convince us that the prosecution's theory of the case was inextricable from and anchored in the now-erroneous "right to control" theory. She further argues that her conviction on Count V should be vacated because the jury instructions improperly paraphrased her alleged false statement and misstated the law, and the government failed to meet its burden of proving her statement was false. Whatever the merits of these arguments, however, we decline to address them because of McBride's numerous procedural stumbles.

A. McBride waived her challenges to Counts I, II, and III because she invited error and also failed to plead plain error.

Those who disregard procedural requirements play a dangerous game and do so at their peril. This appeal proves that point. Pursuant to Federal Rule of Appellate Procedure 28(a)(8)(B), appellants are required to set forth the standard of review applicable to appellate review. McBride utterly fails to do this, so we note it here ourselves. In a properly briefed case, we review a "district court's decision to give or not give a particular jury instruction" for abuse of discretion. United States v. Jereb, 882 F.3d 1325, 1335 (10th Cir. 2018). "[W]e review the instructions as a whole de novo to determine whether they accurately informed the jury of the governing law." Id. (quoting United States v. Sharp, 749 F.3d 1267, 1280 (10th Cir. 2014)). If an appellant fails to object to a particular jury instruction below, we review for plain error. Id.

1. Invited Error

We first address McBride's argument that her convictions on Counts I, II, and III—conspiracy to commit wire fraud, wire fraud, and major fraud against the United States respectively—must be vacated because the jury instructions given were improper post-Ciminelli.⁴ Specifically, McBride contends the jury instruction defining a "scheme to defraud" was improper because it failed to appropriately caution the jury that, as clarified by the Supreme Court in Ciminelli, federal fraud statutes only protect "traditional property interests." As such, McBride argues that the instruction, which only defined the object of a "scheme to defraud" as "money or property," was insufficient because it allowed the jury to convict McBride and Odyssey if it found that they had "merely intended to cause the government to dispense funds contrary to a government policy," even if they had not intended to and did not ultimately harm the government's traditional property interests. Aplt. Br. at 12. It is here, the government counters, that McBride runs into her first hurdle on appeal: McBride herself offered the instruction about which she now complains and is therefore precluded from challenging it under our invited error doctrine. We agree.

Generally, "the invited-error doctrine precludes a party from arguing that the district court erred in adopting a proposition that the party had urged the district court to adopt." United States v. Deberry, 430 F.3d 1294, 1302 (10th Cir. 2005). A party who "induces an erroneous ruling" from the district court may not then seek sanctuary from the consequences of that ruling through an appeal. Id. In jury instruction challenges specifically, our caselaw forecloses "this Court [from engaging] in appellate review when a defendant has waived his right to challenge a jury instruction by affirmatively approving it at trial." United States v. Cornelius, 696 F.3d 1307, 1319 (10th Cir. 2012). See also, e.g., United States v. Visinaiz, 428 F.3d 1300, 1310-11 (10th Cir. 2005) (holding that the defendant's challenge to his own proffered instruction was "thereto [ ] precluded as invited error"); United States v. Sturm, 673 F.3d 1274, 1281 (10th Cir. 2012) ("[The defendant] did not object to the theory of defense instruction given at trial, and proffered the challenged instruction himself. His attack on the sufficiency of this instruction is therefore barred by the invited-error doctrine . . . ."); United States v. Harris, 695 F.3d 1125, 1130 n.4 (10th Cir. 2012) (holding that a "defendant who proffers his or her own instruction, persuades the court to adopt it, and then later seeks to attack the sufficiency of that instruction" has invited error); Jereb, 882 F.3d at 1340 (holding that the invited error doctrine applied when a defendant "requested (and received) jury instructions" he had sought).

The government argues, and McBride conceded at oral argument, that McBride proffered the instruction she now attacks. The government and McBride submitted joint jury instructions to the trial court. True, the parties did not entirely agree on the instruction at issue, Instruction No. 35, and they submitted competing instructions to that end.⁵ However, that is immaterial. What McBride challenges is the definition of a "scheme to defraud," which she argues is insufficient under Ciminelli's new understanding of federal fraud statutes. That definitional language in the Defense Instruction was the same as that included in the Prosecution Instruction and, more importantly, the same as that ultimately adopted by the trial court. For the purposes of this appeal, then, we consider the district court as having adopted McBride's proposed language. We note that, although it is insufficient standing alone, the defense also failed to object to that instruction.⁶ See Harris, 695 F.3d at 1130 n.4.

In her reply, McBride halfheartedly implies that our "supervening decision doctrine" offers a metaphorical escape-hatch from her invited...