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UNITED STATES v. SMITH

December 14, 1987

United States of America
v.
William T. Smith, Jr.



The opinion of the court was delivered by: MUIR

 MUIR, U.S. District Judge

 THE BACKGROUND OF THIS ORDER IS AS FOLLOWS:

 Currently pending before this Court is the motion of William T. Smith, Jr., to vacate, set aside, or correct sentence pursuant to 28 U.S.C. § 2255. On June 24, 1985, Smith was found guilty by a jury on nine counts of an indictment handed down October 22, 1984. One count was for conspiracy to commit mail fraud and interstate transportation in aid of racketeering. The conspiracy count charged that Smith and his co-conspirators sought to obtain Federal Insurance Contribution Act ("FICA") recovery contracts from state and local entities on a no-bid basis by bribing public officials with cash, employment, campaign contributions, paid travel, stock and property. Indictment, Count 1, para. 3. Three of the counts on which Smith was convicted were for violation of the federal mail fraud statute, 18 U.S.C. § 1341, and five counts were for violation of the interstate transportation in aid of racketeering statute, 18 U.S.C. § 1952.

 On July 23, 1985, this Court sentenced Smith to a 12 year prison term and a $ 63,000 fine. Smith's conviction was affirmed by the Court of Appeals for the Third Circuit on April 28, 1986. United States v. Smith, 789 F.2d 196 (3d Cir. 1986). The United States Supreme Court denied Smith's petition for writ of certiorari on December 15, 1986. Smith v. United States, 479 U.S. 1017, 107 S. Ct. 668, 93 L. Ed. 2d 720 (1986). His conviction became final on that date. See Griffith v. Kentucky, 479 U.S. 314, 107 S. Ct. 708, 712 n.6, 93 L. Ed. 2d 649 (1987). He now seeks to attack collaterally his conviction on the basis of the decision of the United States Supreme Court in McNally v. United States, 483 U.S. 350, 107 S. Ct. 2875, 97 L. Ed. 2d 292 (1987), which he claims invalidates his conviction on all counts.

 In McNally the United States Supreme Court held that the federal mail fraud statute, 18 U.S.C. § 1341, is limited in scope to the protection of money or tangible property and does not extend to schemes to defraud citizens of their intangible right to honest and impartial government. McNally, U.S. at , 107 S. Ct. at 2879. In so deciding, the Court rejected the view taken by every Court of Appeals since at least 1941 that had considered the issue. See McNally, U.S. at , 107 S. Ct. at 2883-2884 (Stevens, J., dissenting) (footnotes collecting cases). The Supreme Court reversed McNally's mail fraud conviction because the District Court's instructions permitted the jury to convict McNally for conduct which deprived the citizens of Kentucky of their intangible right to have the Commonwealth's governmental affairs performed honestly. Such conduct, the Court held, was not within the reach of the federal mail fraud statute, 18 U.S.C. § 1341.

 Smith contends that this Court's charge to the jury similarly permitted the jury to convict Smith for violation of the mail fraud statute for conduct not within the reach of the statute: depriving the citizens of the Commonwealth of Pennsylvania of their intangible right to good and faithful service by their elected officials. Additionally, he asserts that the McNally decision undoes his convictions for conspiracy and interstate transportation in aid of racketeering. This Court's instruction to the jury defining a scheme or artifice which Smith now contends entitles him to a vacation of his sentence was as follows:

 
The words "scheme" and "artifice" as used in the statute . . . include any plan or course of action intended to deceive other people and to obtain by false or fraudulent pretenses, representations, or promises, money or property from persons so deceived.
 
The object of the scheme need not be money or any form of tangible property. A scheme to defraud the citizens of a governmental unit of the good and faithful services of their employees and elected public officials can come within the meaning of scheme or artifice to defraud as set forth in the mail fraud statute.

 Transcript June 13, 1985, page 158.

 The first issue we must resolve is whether the new statutory interpretation set forth in McNally should be applied on collateral review of Smith's conviction which became final before the opinion in McNally was announced.

 McNally did not announce a new constitutional rule of criminal procedure and thus the United States Supreme Court's tripartite test for determining whether a new rule of criminal procedure is to be applied retroactively is inapplicable to this case. See, e.g., Stovall v. Denno, 388 U.S. 293, 18 L. Ed. 2d 1199, 87 S. Ct. 1967 (1967) and Griffith v. Kentucky, 479 U.S. 314, 107 S. Ct. 708, 93 L. Ed. 2d 649 (1987). McNally announced a new statutory interpretation by invalidating the intangible rights theory of mail fraud. It did not find that the intangible rights theory violated the constitution.

 In Sunal v. Large, 332 U.S. 174, 91 L. Ed. 1982, 67 S. Ct. 1588 (1947), the United States Supreme Court held that defendants may not collaterally attack convictions that under later Supreme Court precedent would have been invalid because they had not raised the issues on direct appeal which they sought to raise in their collateral attack. The defendants in Sunal were convicted of failure to submit to induction into the Army in 1945. At trial they were prevented from introducing evidence showing that their selective service classifications were invalid. In 1946, the Supreme Court decided Estep v. United States, 327 U.S. 114, 90 L. Ed. 567, 66 S. Ct. 423 (1946), in which it held that the defense of improper classification was a valid one. Relying on the new law, the Sunal defendants sought collaterally to attack their convictions by way of petition for writ of habeas corpus. The Supreme Court denied the petitions because the defendants had not appealed their convictions. The defendants argued that they did not appeal because "the state of the law made the appeals seem futile." Sunal, 332 U.S. at 178. Although the Court acknowledged that lower court decisions had consistently ruled that no ...


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