No. 99-804 

In the Supreme Court of the United States 

CARL W. CLEVELAND, PETITIONER 

v. 

UNITED STATES OF AMERICA 

ON WRIT OF CERTIORARI 
TO THE UNITED STATES COURT OF APPEALS 
FOR THE FIFTH CIRCUIT 

BRIEF FOR THE UNITED STATES 

SETH P. WAXMAN 

Solicitor General 

Counsel of Record 

JAMES K. ROBINSON 

Assistant Attorney General 

MICHAEL R. DREEBEN 

Deputy Solicitor General 

BARBARA MCDOWELL 

Assistant to the Solicitor 

General 

JOEL M. GERSHOWITZ 

Attorney 

Department of Justice 
Washington, D.C. 20530-0001 
(202) 514-2217 

QUESTION PRESENTED 

Whether the federal mail fraud statute, 18 U.S.C. 
1341, reaches a scheme to obtain a video poker license 
from the State of Louisiana by means of false repre- 
sentations. 

(I) 

TABLE OF CONTENTS 

Page 

Opinions below ............................................................................... 
1 

Jurisdiction ...................................................................................... 1 

Statute involved ............................................................................. 
2 

Statement ........................................................................................ `2 

Summary of the argument ........................................................... 
5 

Argument: 

Petitioner’s scheme to obtain a video poker license 

by providing false information to the State through 

the mails violated the mail fraud statute .......................... 

9 

I. A scheme to obtain property through fraudulent 

means violates the mail fraud statute, whether 

or not the scheme was one to deprive a victim 

of property ...................................................................... 
10 

A. The second clause of 18 U.S.C. 1341 does 

not require that a victim be deprived of 

money or property, so long as the defen- 
dant obtained money or property ....................... 

10 

B. The scheme in this case violated the second 

clause of Section 1341 because petitioner 

sought to “obtain[] property” in the form 

of a state video poker license .............................. 

20 

C. The indictment charged and the jury 

necessarily found that petitioner engaged 

in a scheme to obtain property in violation 

of the second clause of Section 1341 ................... 

25 

II. Petitioner violated the mail fraud statute by 

engaging in a scheme to deprive the State of an 

interest in property ...................................................... 27 

(III) 

IV 

Table of Contents—Continued: 
Page 

A. The Louisiana Video Draw Poker Device 

Control Law vests the State with a financial 

stake in video poker licenses and with con- 
trol over how the licenses are used .................... 

28 

B. The State has a property interest in video 

poker licenses ......................................................... 

32 

C. Congress’s enactment of 18 U.S.C. 1346 has 

no bearing on any issue presented in this 

case ........................................................................... 42 

Conclusion ....................................................................................... 45 

Appendix A ..................................................................................... 
1a 

Appendix B ..................................................................................... 
2a 

Appendix C ..................................................................................... 
5a 

TABLE OF AUTHORITIES 

Cases: 

Badders v. United States, 240 U.S. 391 (1916) ................. 

42 

Barry v. Barchi, 443 U.S. 55 (1979) .................................... 

7, 21 

Beauchamp v. De Abadia, 779 F.2d 773 (1st Cir. 

1985) ......................................................................................... 21 

Bell v. Burson, 402 U.S. 535 (1971) .................................... 

7, 21 

Bogus v. American Nat’l Bank of Cheyenne, 

401 F.2d 458 (10th Cir. 1968) ............................................... 

22 

Borre v. United States, 940 F.2d 215 (7th Cir. 

1991) .......................................................................... 

37-38, 39, 40 

Branch v. Jesup, 106 U.S. 468 (1883) ................................. 

38 

California v. Central Pac. R.R., 127 U.S. 1 (1888) ........... 

37 

Carpenter v. United States, 484 U.S. 19 (1987) ................ 

21, 

36, 41 

Consolidated Fruit Jar Co. v. Wright, 94 U.S. 92 
(1877) ........................................................................................ 34 

Dayton Bd. of Educ. v. Brinkman, 433 U.S. 406 

(1977) ........................................................................................ 19 

V 

Cases—Continued: Page 

Drye v. United States, 120 S. Ct. 474 (1999) ............... 

22, 25 

Durland v. United States, 161 U.S. 306 (1896) ................ 

17 

FCC v. Pacifica Found., 438 U.S. 726 (1978) ................... 

13 

Florida Prepaid Postsecondary Educ. Expense Bd. 

v. College Sav. Bank, 527 U.S. 627 (1999) ...................... 

34 

Frost v. Corporation Comm’n, 278 U.S. 515 

(1929) .................................................................................... 

37, 38 

Fugazy Express, Inc., In re, 114 B.R. 865 (Bankr. 

S.D.N.Y. 1990) ........................................................................ 

22 

Garcia v. United States, 469 U.S. 70 (1984) ...................... 

13 

Hammerschmidt v. United States, 484 U.S. 19 

(1987) ........................................................................................ 21 

Jackson, Ex parte, 96 U.S. 727 (1877) ................................... 

42 

Kaiser Aetna v. United States, 444 U.S. 164 

(1979) ........................................................................................ 34 

Keney v. Derbyshire, 718 F.2d 352 (10th Cir. 

1983) ..................................................................................... 

21, 25 

Kimura, In re, 969 F.2d 806 (9th Cir. 1992) ........................ 

21 

Loretto v. Teleprompter Manhattan CATV Corp., 

458 U.S. 419 (1982) .............................................................. 

8, 36 

Louisiana v. Morgan, 28 La. Ann. 482, aff ’d, 

93 U.S. 217 (1876) ................................................................. 

38 

Mackey v. Montrym, 443 U.S. 1 (1979) ............................ 

7, 21 

Maestri v. Board of Assessors, 34 So. 658 (La. 

1903) ......................................................................................... 38 

McNally v. United States, 483 U.S. 350 (1987) ........ 

passim 

Mercoid Corp. v. Mid-Continent Inv. Co., 320 U.S. 

661 (1944) ................................................................................. 

34 

New Orleans Gas Co. v. Louisiana Light Co., 

115 U.S. 650 (1885) ................................................................ 

37 

Northwest Airlines, Inc. v. County of Kent, 

510 U.S. 355 (1994) ................................................................ 

19 

O’Neill’s Shannon Village, In re, 750 F.2d 679 

(8th Cir. 1984) ......................................................................... 22 

VI 

Cases—Continued: Page 

Rainbo Express, In re, 179 F.2d 1 (7th Cir.), cert. 

denied, 339 U.S. 981 (1950) .................................................. 

22 

Rapier, In re, 143 U.S. 110 (1892) ......................................... 

41 

Reiter v. Sonotone Corp., 442 U.S. 330 (1979) ........ 

13, 21, 23 

Salinas v. United States, 522 U.S. 52 (1997) ...... 

14-15, 18, 41 

Standefer v. United States, 447 U.S. 10 (1980) ................. 

18 

Streep v. United States, 160 U.S. 128 (1895) ..................... 

14 

Tennessee Elec. Power Co. v. TVA, 306 U.S. 118 

(1939) ........................................................................................ 38 

Terwilligers Catering Plus, Inc., In re, 911 F.2d 

1168 (6th Cir. 1990), cert. denied, 501 U.S. 1212 

(1991) .................................................................................... 

21, 22 

Toulabi v. United States, 875 F.2d 122 (7th Cir. 

1989) ..................................................................................... 

23, 40 

Transparent-Wrap Mach. Corp. v. Stokes & Smith 

Co., 329 U.S. 637 (1947) ....................................................... 

34 

21 W. Lancaster Corp. v. Main Line Restaurant, 

Inc., 790 F.2d 354 (3d Cir. 1986) ..................................... 

21, 22 

United States v. Alkins, 925 F.2d 541 (2d Cir. 

1991) ......................................................................................... 44 

United States v. Bass, 404 U.S. 336 (1971) ....................... 

41 

United States v. Bucuvalas, 970 F.2d 937 (1st 

Cir. 1992), cert. denied, 507 U.S. 959 (1993) ................... 

4, 36 

United States v. Clausen, 792 F.2d 102 (8th Cir.), 

cert. denied, 479 U.S. 858 (1986) ......................................... 

14 

United States v. Cronic, 900 F.2d 1511 (10th Cir. 

1990) ......................................................................................... 14 

United States v. Ferrara, 701 F. Supp. 39 

(E.D.N.Y.), aff ’d without opinion, 868 F.2d 1268 

(2d Cir. 1988) .......................................................................... 

23 

United States v. Frost, 125 F.3d 346 (6th Cir. 

1997), cert. denied, 525 U.S. 810 (1998) ............................. 

33 

United States v. Gonzales, 520 U.S. 1 (1997) ..................... 

41 

United States v. Granberry, 908 F.2d 278 (8th 

Cir. 1990), cert. denied, 500 U.S. 921 (1991) ..................... 22 

VII 

Cases—Continued: Page 

United States v. Halbert, 640 F.2d 1000 (9th Cir. 

1981) ......................................................................................... 14 

United States v. Italiano, 894 F.2d 1280 (11th 

Cir. 1990) ................................................................................. 

38 

United States v. Kato, 878 F.2d 267 (9th Cir. 

1989) ....................................................................................... 22-23 

United States v. Martinez, 905 F.2d 709 (3d Cir.), 

cert. denied, 498 U.S. 1017 (1990) .................. 

4, 12, 14, 19, 20 

United States v. Murphy, 836 F.2d 248 (6th Cir.), 

cert. denied, 488 U.S. 924 (1988) ......................................... 

23 

United States v. Novod, 923 F.2d 970 (2d Cir.), 

cert. denied, 500 U.S. 919 (1991) ......................................... 

33 

United States v. Salvatore, 110 F.3d 1131 (5th 

Cir.), cert. denied, 522 U.S. 981 (1997) .................. 

5, 8, 20, 24, 

28, 32, 36, 40 

United States v. Shotts, 145 F.3d 1289 (11th Cir. 
1998) ......................................................................................... 40 

Whitson v. United States, 122 F.2d 1016 (9th Cir. 

1941) ......................................................................................... 12 

Statutes: 

Act of June 8, 1872, ch. 335, § 301, 17 Stat. 323 ................... 

10 

Act of Mar. 2, 1889, ch. 393, § 1, 25 Stat. 873 ............. 

10, 15, 19 

Act of Sept. 19, 1890, ch. 908, §§ 1-3, 26 Stat. 

465-466 ..................................................................................... 17 

Act of Mar. 4, 1909, ch. 321, § 215, 35 Stat. 1130 ................. 

10, 

15, 19 

Anti-Drug Abuse Act of 1988, Pub. L. No. 100-690, 
Title VII, Subtitle O, § 7603(a), 102 Stat. 4508 ............ 

11, 43 

11 U.S.C. 541 .............................................................................. 

22 

18 U.S.C. 2 .................................................................................. 

42 

18 U.S.C. 371 .............................................................................. 

4 

18 U.S.C. 1341 .................................................................... 

passim 

18 U.S.C. 1346 ........................................................... 11, 42, 43, 44 

VIII 

Statutes—Continued: Page 

18 U.S.C. 1956 (1994 & Supp. II 1996) .................................. 

4 

18 U.S.C. 1962(c) ....................................................................... 

4 

18 U.S.C. 1962(d) ....................................................................... 

4 

26 U.S.C. 6321 .......................................................................... 

24-25 

26 U.S.C. 7206(2) ....................................................................... 

4 

Louisiana Admin. Code title 42 (2000): 

§ 2405(A)(2) ............................................................................. 

32 

§ 2409(A)(1).............................................................................. 32 

§ 2409(A)(2) ............................................................................. 

32 

Louisiana Video Draw Poker Devices Control Law, 

La. Rev. Stat. Ann. (West 1989 & Supp. 2000): 

§§ 27:301 et seq. ................................................................... 

23 

§ 27:301(B)(8) ..................................................................... 

23 

§ 27:301(D) .......................................................................... 

24 

§ 27:302(A)(1)-(4) ............................................................... 

30 

§ 27:302(A)(5)(a)-(g) .......................................................... 

30 

§ 27:302(A)(5)(h)-(o) .......................................................... 

30 

§ 27:302(A)(5)(o) ................................................................ 

35 

§ 27:302(D) .......................................................................... 

30 

§ 27:304 ................................................................................ 

30 

§ 27:305(A) .......................................................................... 

30 

§ 27:306 ................................................................................ 

32 

§ 27:306(A)(1) ................................................................. 

30, 31 

§ 27:306(A)(2) ..................................................................... 

30 

§ 27:306(A)(2)-(4) ............................................................... 

30 

§ 27:306(A)(4)(a) ................................................................ 

30 

§ 27:306(A)(4)(b) ................................................................ 

29 

§ 27:306(A)(5)(b) ................................................................ 

24 

§ 27:306(D)(2) ..................................................................... 

31 

§ 27:306(D)(2)(b) ................................................................ 

36 

§ 27:306(E) .......................................................................... 

36 

§ 27:308(B) ......................................................... 

24, 31, 32, 36 

§ 27:308(C) ......................................................... 

24, 31, 32, 36 

§ 27:308(E)(5) ..................................................................... 

30 

§ 27:310(B) ................................................................ 

3, 23, 31 

§ 27:310(B)(8) ..................................................................... 23 

IX 

Statutes—Continued: Page 

§ 27:310(E) .......................................................................... 

24 

§ 27:311(A) ............................................................... 

28, 32, 35 

§ 27:311(A)(4)(b) ................................................................ 

29 

§ 27:311(A)(5)(c) ................................................................. 

29 

§ 27:311(A)-(D) ............................................................... 

23, 32 

§ 27:311(B) .......................................................................... 

29 

§ 27:311(D) ............................................................... 

29, 35, 39 

§ 27:311(G) ......................................................... 

23, 31, 32, 35 

§ 27:311(H) .......................................................................... 

23 

§ 27:111(H)(2) ................................................................. 

23, 28 

§ 27:311(H)(4) ..................................................................... 

28 

§ 27:312 .............................................................................. 

29-30 

Md. Regs. Code title 14, § 14.01.03.12 (2000) ....................... 

39 

N.Y. Rac. Pari-Mut. Wag. & Breed. Law § 502 

(McKinney 2000) .................................................................... 

39 

Or. Rev. Stat. (1997): 

§ 461.213 .................................................................................. 

39 

§ 461.215 .................................................................................. 

39 

§ 461.543 .................................................................................. 

39 

30 Geo. II, Ch. 24 (1757) (Eng.) .............................................. 
12 

Miscellaneous: 

American Heritage Dictionary (3d ed. 1994) ...................... 

11 

Blacks Law Dictionary (5th ed. 1979) .................................. 
11 

42 Cong. Rec. 1026 (1908) ........................................................ 
16 

134 Cong. Rec. (1988): 
pp. 33,296-33,297 .................................................................... 
43 

p. 33,297 ................................................................................. 
43 

p. 32,708 ................................................................................. 
43 

p. 33,318 ................................................................................. 
43 

1 D. Ferris et al., Cable Television Law (1990) .................. 
38 

Gambling: The Trouble Is, It Makes Money, The 

Economist, July 31, 1999 ...................................................... 

30 

Adam H. Kurland, The Guarantee Clause as a Basis for 

Federal Prosecutions of State and Local Officials, 
62 So. Cal. L. Rev. 367 (1989) .......................................... 43, 44 

X 

Miscellaneous—Continued: Page 

Louisiana Legislative Fiscal Office, State Gaming 

Revenue—Sources and Uses (Dec. 20, 1999) ............... 
29, 33 

77 Md. Op. Att’y Gen. 82 (1992) .............................................. 
39 

VII James A.H. Murray, New English Dictionary 
(1909) ........................................................................................ 11 

Jed S. Rakoff, The Federal Mail Fraud Statute (Part I), 
18 Duq. L. Rev. 771 (1980) ................................ 

10, 15, 17, 19 

Random House Dictionary of the English Language 
(2d ed. 1987) ............................................................................ 
11 

S. Doc. No. 68, 57th Cong., 1st Sess. Pt. 2 (1901) ............ 
16, 17 

Alan Sayre, Video Poker Edges Back in La., The 

Charleston Gazette, Feb. 28, 2000 ...................................... 

30 

Websters New Collegiate Dictionary (1977) ........................ 
11 

Webster’s New International Dictionary (1917) ................. 11 

In the Supreme Court of the United States 

No. 99-804 

CARL W. CLEVELAND, PETITIONER 

v. 

UNITED STATES OF AMERICA 

ON WRIT OF CERTIORARI 
TO THE UNITED STATES COURT OF APPEALS 
FOR THE FIFTH CIRCUIT 

BRIEF FOR THE UNITED STATES 

OPINIONS BELOW 

The opinion of the court of appeals (Pet. App. 1a-44a) 
is reported at 182 F.3d 296. The opinion of the district 
court (Pet. App. 52a-86a) is reported at 951 F. Supp. 
1249. 

JURISDICTION 

The judgment of the court of appeals was entered on 
July 21, 1999. The petition for rehearing was denied on 
September 2, 1999 (Pet. App. 45a-47a). The petition for 
a writ of certiorari was filed on November 9, 1999, and 
was granted on March 20, 2000, limited to the first 

(1) 

2 

question presented. The jurisdiction of this Court rests 
on 28 U.S.C. 1254(1). 

STATUTE INVOLVED 

Section 1341 of Title 18 of the United States Code is 
set forth in Appendix A to this brief. 

STATEMENT 

This case arises out of a scheme to obtain a lucrative 
video poker license from the State of Louisiana by 
submitting false information to the State about the 
prospective licensee’s true owners. Petitioner chal- 
lenges the court of appeals’ holding that such a scheme 
violates the federal mail fraud statute, 18 U.S.C. 1341. 

1. In 1992, Fred Goodson and his family formed 
Truck Stop Gaming, Ltd. (TSG, Ltd.) and its corporate 
partner, Truck Stop Gaming, Inc. (TSG, Inc.), in order 
to participate in the video poker business at their truck 
stop in Slidell, Louisiana. Petitioner Carl Cleveland, a 
lawyer, assisted the Goodsons in preparing applications 
for a video poker license for TSG, Ltd., and submitting 
those applications to the State. The applications re- 
quired a partnership seeking a gaming license to iden- 
tify its partners, to submit personal financial state- 
ments for all partners, to affirm that the listed partners 
were the sole beneficial owners of the business, and to 
affirm that no partner had an arrangement to hold his 
interest as “an agent, nominee or otherwise,” or a pre- 
sent intention to transfer any interest in the partner- 
ship at a future time. Pet. App. 2a-3a. 

The initial application submitted on behalf of TSG, 
Ltd., identified Maria and Alex Goodson, Fred Good- 
son’s adult children, as the limited partners and TSG, 
Inc., as the general partner. The application listed no 
other persons or entities as having any ownership 
interest in TSG, Ltd. In 1993, 1994, and 1995, TSG, 

3 

Ltd., submitted renewal applications that likewise 
listed no additional ownership interests. In fact, the 
true owners of TSG, Ltd., at all times were petitioner 
and Fred Goodson, both of whom concealed their 
ownership interests from state regulators to avoid an 
inquiry into their suitability as owners of a licensee. 
Pet. App. 5a-6a; see La. Rev. Stat. Ann. § 27:310(B) 
(West 1989 & Supp. 2000) (enumerating suitability 
requirements for video poker licensees).1 

2. In 1996, a federal grand jury in the Eastern Dis- 
trict of Louisiana indicted petitioner, Fred and Maria 
Goodson, and others on multiple counts of mail fraud, 
racketeering, and various other offenses. The indict- 
ment alleged, among other things, that the defendants 
committed mail fraud, in violation of 18 U.S.C. 1341, by 
obtaining a video poker license for TSG, Ltd., in 1992 
and renewing the license in 1993, 1994, and 1995, by 
fraudulently concealing that petitioner and Fred Good- 
son were the true owners of TSG, Ltd. Pet. App. 5a. 
Before trial, petitioner moved to dismiss the mail 
fraud counts of the indictment on the ground that state 
licenses to operate video poker machines do not 
constitute “property” within the meaning of Section 
1341, which makes it a crime to use the mails in 
connection with “any scheme or artifice to defraud, or 
for obtaining money or property by means of false or 
fraudulent pretenses, representations, or promises.” 18 
U.S.C. 1341. Petitioner claimed that a scheme to 
acquire a video poker license through false representa- 
tions does not implicate any property interest of the 

1 The evidence at trial indicated that petitioner and Fred 
Goodson had tax and financial problems that could have interfered 
with or delayed approval of the license if their interests in TSG, 
Ltd., had been disclosed. See Gov’t C.A. Br. 11. 

4 

State, arguing that such licenses have no value to the 
State and, consequently, do not become property until 
they are issued by the State to a private party. 

The district court rejected that contention. Pet. App. 
73a-86a. The court concluded that “licenses constitute 
property even before they are issued,” agreeing with 
the position of the First Circuit and the Third Circuit 
on that question. Id. at 79a; see also id. at 75a-77a 
(citing United States v. Bucuvalas, 970 F.2d 937 (1st 
Cir. 1992), cert. denied, 507 U.S. 959 (1993), and United 
States v. Martinez, 905 F.2d 709 (3d Cir.), cert. denied, 
498 U.S. 1017 (1990)). The court distinguished cases 
involving other sorts of licenses, such as taxi licenses, 
pilot’s licenses, and arms export licenses, in which a 
government was held to have only a regulatory inter- 
est, and not a property interest. Id. at 83a. The court 
reasoned that the State of Louisiana clearly has a 
property interest in video poker licenses because the 
State “receives a significant percentage of revenue” 
from the licenses and “continues to exercise a great 
deal of control” over them. Id. at 83a. 

After a jury trial, petitioner was convicted on two 
counts of mail fraud. He was also convicted of con- 
ducting an enterprise through a pattern of racketeering 
activity, in violation of 18 U.S.C. 1962(c); conspiring to 
commit that offense, in violation of 18 U.S.C. 1962(d); 
money laundering, in violation of 18 U.S.C. 1956 (1994 & 
Supp. II 1996); tax conspiracy, in violation of 18 U.S.C. 
371; and filing a false tax return, in violation of 26 
U.S.C. 7206(2). He was sentenced to 121 months’ im- 
prisonment. 

3. The Fifth Circuit affirmed petitioners’ conviction 
and sentences. Pet. App. 1a-44a. 

The court of appeals rejected petitioner’s contention 
that a video poker license does not constitute property 

5 

for purposes of the mail fraud statute. Pet. App. 19a. 
The court relied on its earlier decision in United States 

v. Salvatore, 110 F.3d 1131 (5th Cir.), cert. denied, 522 
U.S. 981 (1997), which held that Louisiana had a prop- 
erty interest in the video poker licenses that it issues. 
In Salvatore, the court of appeals explained that 
“property” is defined as “a legal ‘bundle of rights’ ” that 
one possesses in connection with a particular object. 
110 F.3d at 1140. The court reasoned that, because the 
State has the right to control whether and to whom 
video poker licenses are issued, the State has a 
property interest in the licenses. Ibid. The court 
rejected the defendants’ argument that a video poker 
license has no value to the State, and thus cannot 
constitute property. It explained that “(1) the State 
expects to collect an up-front fee (before issuance) and a 
percentage of net revenues (in the future) from the 
putative licensee and (2) the State values its rights to 
control the licenses and to choose the parties to whom it 
issues the licenses.” Id. at 1141. The court also 
rejected the defendants’ contention that the State’s 
interest in the video poker licenses is a regulatory 
interest, rather than a property interest, noting the 
State’s “direct and significant financial stake * * * as 
issuer of the licenses” that continues throughout the 
term of the licenses. Id. at 1142. The court thus 
concluded that “a video poker license does not merely 
signify government approval of an individual’s right to 
take part in a particular industry,” but “also evinces the 
State’s intent to participate in that industry.” Id. at 
1141. 

SUMMARY OF THE ARGUMENT 

The federal mail fraud statute, 18 U.S.C. 1341, 
reaches “any scheme or artifice to defraud, or for ob- 

6 

taining money or property by means of false or fraudu- 
lent pretenses, representations, or promises” that 
involves the use of the mails. The court of appeals held 
in this case that petitioner violated the mail fraud 
statute by engaging in a scheme to obtain and renew a 
Louisiana video poker license by making false repre- 
sentations to the State about the ownership of the 
licensee. Petitioner contends that the scheme does not 
come within the scope of the mail fraud statute, arguing 
that the video poker license was not “money or 
property” in the hands of the State. Petitioner is 
mistaken for two independent reasons. First, because 
the government proved that petitioner violated the 
second clause of the mail fraud statute by engaging in a 
“scheme * * * for obtaining money or property” by 
false or fraudulent means, the government did not also 
have to prove that the scheme sought to deprive the 
State of money or property. Second, whether or not the 
government was required under the mail fraud statute 
to prove that petitioner deprived the State of money or 
property, the State had a property interest in the video 
poker license at issue here. 

1. The second clause of the mail fraud statute, which 
proscribes “any scheme * * * for obtaining money or 
property by means of false or fraudulent pretenses, 
representations, or promises,” does not require that the 
scheme be one for depriving a victim of money or 
property. Nothing in the common understanding of the 
word “obtain” suggests that such a deprivation is 
required. Although Congress could have narrowed the 
second clause by including the words “from another” at 
the end of the phrase “for obtaining money or prop- 
erty,” Congress did not do so. The second clause thus 
encompasses cases in which a defendant, through false 
or fraudulent means, obtains something that might not 

7 

be “money or property” in the hands of the victim, but 
that becomes “money or property” in the defendant’s 
own hands. 

In McNally v. United States, 483 U.S. 350 (1987), the 
Court construed the first clause of the mail fraud 
statute to hold that a “scheme or artifice to defraud” 
must be aimed at depriving a victim of a right to money 
or property, as opposed to “intangible rights, such as 
the right to have public officials perform their duties 
honestly.” Id. at 358. The Court rested that conclusion 
on the contemporaneous understanding of the phase “to 
defraud” in the first clause. The Court’s decision thus 
did not turn on the “money or property” language of 
the second clause. Indeed, the Court observed that, 
“because the two [clauses] identifying the proscribed 
schemes appear in the disjunctive, it is arguable that 
they are to be construed independently.” Ibid. 

The scheme in this case was indisputably one “for 
obtaining money or property” under the second clause 
of the mail fraud statute. A video poker license, 
whether or not property in the hands of the State, is 
property in the hands of the licensee. Such a license 
enables the holder to engage in a lucrative business, 
which would otherwise be illegal, and is protected 
under state law against arbitrary suspension or revoca- 
tion. This Court and the lower federal courts have 
recognized, in a variety of contexts, that a person has a 
property interest in a government-issued license that 
enables him to engage in an occupation, a business, or 
another money-making activity. See, e.g., Barry v. 
Barchi, 443 U.S. 55, 64 (1979); Mackey v. Montrym, 443 
U.S. 1, 10 (1979); Bell v. Burson, 402 U.S. 535, 542 
(1971). 

2. In any event, the State of Louisiana has a 
property interest in the video poker licenses that it 

8 

issues. A video poker license is plainly “something of 
value,” McNally, 483 U.S. at 358, to the State. The 
State receives a substantial up-front payment for each 
video poker license, an annual licensee fee throughout 
the term of each license, and a percentage of the net 
proceeds from each licensed video poker device. In 
addition, the State retains a significant degree of 
control over each license, including over its renewal, 
transfer, and revocation. As the court of appeals recog- 
nized in an earlier case on this issue, “[o]ne of the main 
reasons for the * * * legalization of video poker [in 
Louisiana] was that it was considered an ongoing 
source of revenue for the State.” United States v. 
Salvatore, 110 F.3d 1131, 1141 (5th Cir.), cert. denied, 
522 U.S. 981 (1997). Indeed, since instituting licensed 
video poker in 1991, the State has reaped hundreds of 
millions of dollars in fees and payments from licensees. 

Moreover, whether or not the State has a property 
interest in an unissued video poker license, this case 
involves a scheme not only to obtain a license, but also 
to renew that license, after its issuance, for three 
subsequent periods. The State has a property interest 
in a video poker license after it has been issued—and 
thus has become property in the hands of the licensee 
—because the State retains the right to payments from 
the licensee and the right to monitor and control the 
licensed activity. The State retains authority over 
renewal, suspension, or revocation of a license, and the 
State prohibits the transfer of a license to another 
person. One of the rights that is often associated with 
the ownership or possession of property is the right to 
control its alienation. See Loretto v. Teleprompter 
Manhattan CATV Corp., 458 U.S. 419, 435 (1982). 

Finally, petitioner contends that the State has 
merely a regulatory interest, not a property interest in 

9 

a video poker license, relying primarily on cases in- 
volving other sorts of government licenses, such as 
driver’s licenses, medical licenses, and arms export 
licenses. But the Court need not decide in this case 
whether a State has a property interest in all of the 
varieties of licenses that it issues. The Court need 
conclude only that the State has a property interest in 
the particular variety of license at issue here—a license 
under which the State retains a substantial economic 
stake in the licensed activity. 

ARGUMENT 

PETITIONER’S SCHEME TO OBTAIN A VIDEO POKER 

LICENSE BY PROVIDING FALSE INFORMATION TO 
THE STATE THROUGH THE MAILS VIOLATED THE 
MAIL FRAUD STATUTE 

The mail fraud statute prohibits (1) “any scheme or 
artifice to defraud” and (2) “any scheme or artifice 

* * * for obtaining money or property by means of 
false or fraudulent pretenses, representations, or 
promises.” A scheme to acquire a Louisiana video 
poker license by false representations violates the 
second clause of the statute, whether or not the license 
constitutes “property” in the hands of the State. The 
object of the scheme is to “obtain[]” the license, and the 
license indisputably constitutes “property” in the hands 
of the licensee. The scheme also violates the first clause 
of the statute. While the words “to defraud” refer to 
“wronging one in his property rights by dishonest 
methods or schemes,” McNally v. United States, 483 
U.S. 350, 358 (1987), the State’s financial stake in and 
control over video poker licenses qualify as a property 
right protected by the mail fraud statute. 

10 

I. A SCHEME TO OBTAIN PROPERTY THROUGH 

FRAUDULENT MEANS VIOLATES THE MAIL 
FRAUD STATUTE, WHETHER OR NOT THE 
SCHEME WAS ONE TO DEPRIVE A VICTIM OF 
PROPERTY 

A. The Second Clause Of 18 U.S.C. 1341 Does Not Require 

That A Victim Be Deprived Of Money Or Property, So 

Long As The Defendant Obtained Money Or Property 

1. Congress enacted three prohibitions in the mail 
fraud statute, 18 U.S.C. 1341, and each clause of the 
statute proscribes a distinct sort of “scheme or artifice.” 
The first clause, which prohibits “any scheme or artifice 
to defraud,” derives from the original mail fraud statute 
enacted in 1872. Act of June 8, 1872, ch. 335, § 301, 17 
Stat. 323. The second clause, which prohibits schemes 
“for obtaining money or property by means of false or 
fraudulent pretenses, representations, or promises,” 
was added in 1909. Act of Mar. 4, 1909, ch. 321, § 215, 35 
Stat. 1130. The third clause, which prohibits schemes to 
use the mails to distribute counterfeit money, was 
enacted in 1889. Act of Mar. 2, 1889, ch. 393, § 1, 25 Stat. 
873. See Jed S. Rakoff, The Federal Mail Fraud Stat- 
ute (Part I), 18 Duq. L. Rev. 771, 779-821 (1980) 
(Rakoff). 

In McNally v. United States, 483 U.S. 350 (1987), this 
Court was concerned with the first clause of Section 
1341. McNally held that a “scheme or artifice to 
defraud,” within the meaning of the statute, must be 
aimed at depriving a victim of a right to money or 
property, as opposed to “intangible rights, such as the 
right to have public officials perform their duties 
honestly.” Id. at 358. The Court rested that conclusion 
on the common understanding of the term “to defraud” 

11 

at the time that the original mail fraud statute was 
enacted. Id. at 358-359.2 

McNally did not construe the second clause of 
Section 1341, which prohibits schemes “for obtaining 
money or property” by false or fraudulent means. The 
second clause does not contain the words “to defraud” 
or any other textual limitation requiring the depriva- 
tion of a victim’s money or property. Nothing in the 
common understanding of the word “obtain,” either 
today or when the second clause was enacted in 1909, 
suggests that such a deprivation is required. See, e.g., 
Webster’s New International Dictionary 1485 (1917) 
(defining “obtain” as “[t]o get hold of by effort; to gain 
possession of; to procure; to acquire, in any way”) (first 
definition).3 

Although Congress could easily have narrowed the 
second clause of Section 1341 by including the words 

2 In response to McNally, Congress enacted 18 U.S.C. 1346, 
which provides that “the term ‘scheme or artifice to defraud’ 
includes a scheme or artifice to deprive another of the intangible 
right of honest services.” Pub. L. No. 100-690, Title VII, § 7603(a), 
102 Stat. 4508. As modified by Section 1346, the first clause of 
Section 1341 now encompasses certain schemes to deprive a victim 
of something other than money or property. 

3 See also, e.g., American Heritage Dictionary 575 (3d ed. 1994) 
(“[t]o succeed in gaining possession of; acquire”); Random House 
Dictionary of the English Language 1338 (2d. ed. 1987) (“[t]o come 
into possession of; get, acquire, or procure, as through an effort or 
by a request”); Black’s Law Dictionary 972 (5th ed. 1979) (“[t]o get 
hold of by effort; to get possession of; to procure; to acquire, in any 
way”); Webster’s New Collegiate Dictionary 793 (1977) (“[t]o gain 
or attain usu. by planned action or effort”); VII James A.H. 
Murray, New English Dictionary 37 (1909) (“[t]o come into the 
possession or enjoyment of (something) by one’s own effort, or by 
request; to procure or gain, as the result of purpose and effort; 
hence, generally, to acquire, get”). 

12 

“from another” at the end of the phrase “for obtaining 
money or property,” Congress did not do so. Congress 
thereby departed from the otherwise similar wording of 
the original English false pretenses statute, which 
made it a crime “by false pretence or pretences, [to] 
obtain from any person * * * money, goods, wares, or 
merchandizes, with intent to cheat or defraud any 
person.” 30 Geo. II, ch. 24 (1757) (emphasis added). 
Congress, like the English Parliament, knew how to 
restrict such crimes to those in which money or 
property was obtained from a victim. 

The second clause of Section 1341 thus encompasses 
those cases in which the defendant, through false or 
fraudulent pretenses, representations, or promises, 
obtains something that might not be “money or pro- 
perty” in the hands of the victim, but that beomes 
“money or property” in the defendant’s own hands. As 
the Third Circuit has put it, the second clause “is broad 
enough to cover a scheme to defraud a victim of 
something that takes on value only in the hands of the 
acquirer.” United States v. Martinez, 905 F.2d 709, 713, 
cert. denied, 498 U.S. 1017 (1990); cf. Whitson v. United 
States, 122 F.2d 1016, 1017 (9th Cir. 1941) (mail fraud 
statute reached scheme to persuade charitable 
organizations to enter into contract under which 
defendant would be their exclusive fund-raiser; court 
explained that under the statute “the scheme need not 
be one to secure moneys from others, but may be ‘to 
defraud, or for obtaining money or property by means 
of false or fraudulent pretenses’ ”). 

McNally did not address the argument (see U.S. Br. 
at 17-22 in McNally, supra (No. 86-234)), that the 
second clause of the mail fraud statutes applies to any 
scheme to “obtain” money or property, even when the 
scheme does not seek to deprive a victim of money or 

13 

property. Rather, the Court declined to address the 
applicability of the second clause because the jury 
instructions did not require a finding that the 
defendants obtained property by fraudulent means. 
See McNally, 483 U.S. at 361.4 McNally thus leaves 
open the proper construction of the second clause of 
Section 1341. In accordance with its plain language, 
that clause encompasses any scheme “for obtaining 
money or property by means of false or fraudulent 
pretenses, representations, or promises,” whether or 
not the scheme is one for depriving a victim of money or 
property. 

2. The conclusion that the second clause of Section 
1341, unlike the first clause at the time of McNally (see 
note 2, supra), is not limited to schemes to deprive a 
victim of money or property finds support in the 
structure of the statute. The two clauses were, as 
noted above, enacted at different times. The clauses 
are separated, moreover, by the disjunctive “or.” This 
Court has stated, reflecting common English usage, 
that “[c]anons of construction ordinarily suggest that 
terms connected by a disjunctive be given separate 
meanings.” Reiter v. Sonotone Corp., 442 U.S. 330, 339 
(1979); accord Garcia v. United States, 469 U.S. 70, 73 
(1984); FCC v. Pacifica Found., 438 U.S. 726, 739-740 
(1978). Accordingly, this Court, construing an earlier 
version of the mail fraud statute, concluded that an 
indictment that charged a scheme to sell counterfeit 
money, a violation of what is now the third clause, did 
not have to include a charge that the defendant devised 
a scheme “to defraud,” a violation of the first clause, 
because the statutory prohibitions were listed sepa- 

4 The jury charge in this case did not suffer from that defi- 
ciency. See pp. 25-27, infra. 

14 

rately and applied to different conduct. Streep v. 
United States, 160 U.S. 128, 132-133 (1895). 

In McNally, this Court acknowledged that the first 
and second clauses of Section 1341 may likewise have 
separate meanings. The Court observed that 
“[b]ecause the two phrases identifying the proscribed 
schemes appear in the disjunctive, it is arguable that 
they are to be construed independently.” McNally, 483 
U.S. at 358. Thus, the Court did not rest its holding in 
McNally that the first clause of Section 1341 requires a 
deprivation of money or property, as opposed to “in- 
tangible rights,” on the “money or property” language 
of the second clause. Rather, the Court derived that 
requirement from the common understanding of the 
words “to defraud” in the first clause. See id. at 358. 

The lower federal courts have recognized, both 
before and after McNally, that the first and second 
clauses of Section 1341 have independent significance. 
See, e.g., United States v. Martinez, 905 F.2d at 713 
(second clause of Section 1341, but not first clause, 
reaches schemes that do not involve a deprivation of a 
victim’s money or property); United States v. Cronic, 
900 F.2d 1511, 1513-1514 (10th Cir. 1990) (first clause of 
Section 1341, but not second clause, reaches schemes to 
defraud that do not involve false pretenses, representa- 
tions, or promises); United States v Clausen, 792 F.2d 
102, 104-105 (8th Cir.) (same), cert. denied, 479 U.S. 858 
(1986); United States v. Halbert, 640 F.2d 1000, 1007 
(9th Cir. 1981) (same). 

3. The background of the mail fraud statute does not 
require a narrower reading than its language suggests. 
It is well settled that “[o]nly the most extraordinary 
showing of contrary intentions in the legislative history 
will justify a departure” from the “plain and unambigu- 
ous meaning of the statutory language.” Salinas v. 

15 

United States, 522 U.S. 52, 57 (1997) (internal quotation 
marks omitted). Nothing in the scant legislative 
history of the second clause of Section 1341 suggests, 
let alone clearly expresses, any intention that the clause 
be construed other than in accordance with its plain 
language, which encompasses “any scheme or artifice 

* * * for obtaining money or property” by the 
specified fraudulent means, without limitation to those 
schemes involving a deprivation of a victim’s money or 
property. 

In 1909, Congress enacted a comprehensive revision 
of the federal criminal laws that included a number of 
changes in the mail fraud statute. One of those changes 
was the insertion in the statute, after the phrase 
“[w]hoever, having devised or intending to devise any 
scheme or artifice to defraud,” of the phrase “or for 
obtaining money or property by means of false or 
fraudulent pretenses, representations, or promises.”5 

The mail fraud amendments were enacted by the 61st 
Congress without any committee report or floor debate. 
See Rakoff, 18 Duq. L. Rev. at 816 n.205 (noting that 
“there is virtually no direct legislative history” of the 
1909 amendments); see also McNally, 483 U.S. at 357- 
358 & n.7. The only explanations of the mail fraud 

5 The 1909 amendments included other significant changes in 
the mail fraud statute. Those changes included the elimination of 
language characterizing the offense conduct as “misusing the post- 
office establishment,” the elimination of the penalty provision by 
which courts were required to “proportion the punishment espe- 
cially to the degree in which the abuse of the post-office establish- 
ment enters as an instrument into such fraudulent scheme or 
device,” and, most notably, the elimination of the requirement that 
the defendant intended the fraudulent scheme to be effected 
through use of the mails. Compare 25 Stat. 873 with 35 Stat. 1130; 
see Rakoff, 18 Duq. L. Rev. at 816. 

16 

amendments, which reflect the earlier views of their 
sponsor and of the commission that originally proposed 
them, do not specifically address the provision at issue 
here. 

In explaining the mail fraud amendments during the 
60th Congress, Senator Heyburn, the sponsor, dealt 
only with a change in the statute that involved mailings 
made from outside the United States, noting that the 
other changes were self-explanatory. See 42 Cong. 
Rec. 1026 (1908) (remarks of Sen. Heyburn) (“I do not 
think there is any other change, which is not obvious 
upon the face of the bill, that needs any further expla- 
nation.”) (cited in McNally, 483 U.S. at 358 n.7). Sena- 
tor Heyburn’s remark suggests that the second clause 
should be read in accordance with common usage, for 
otherwise its meaning would not be self-explanatory. 

The only other legislative history of the 1909 amend- 
ments is the Report of the Commission to Revise and 
Codify the Criminal and Penal Laws of the United 
States, which in 1901 proposed to the Attorney General 
and Congress a number of changes in the federal 
criminal statutes, including the addition of the language 
that became the second clause of the mail fraud statute. 
See S. Doc. No. 68, 57th Cong., 1st Sess. Pt. 2 (1901) (S. 
Doc. 68) (cited in McNally, 483 U.S. at 357-358 n.7). In 
the portion of the Report describing the proposed 
changes in the mail fraud statute, the Commission did 
not mention the language that became the second 
clause. See id. at xvii.6 In the portion of the Report 

6 The Commission appeared to allude to that provision, how- 
ever, in the portion of the Report discussing the lottery statute. 
The Commission stated that certain words added to the lottery 
statute in 1890 that prohibited mailings “concerning schemes de- 
vised for the purpose of obtaining money or property under false 
pretenses” were being omitted “as they have respect to an offense 

17 

setting forth the text of the revised mail fraud statute, 
the Commission cited, in the margin, five decisions of 
this Court, 29 decisions of the lower federal courts, and 
two Attorney General opinions that had construed the 
existing mail fraud statute. See id. at 63. The Com- 
mission did not, however, explain the significance, if 
any, of those citations.7 

The Court stated in McNally that the addition of the 
second clause in 1909 codified the holding in Durland v. 
United States, 161 U.S. 306, 313 (1896), that the mail 
fraud statute encompasses not only false statements of 
existing fact, but also false promises with respect to the 
future. See McNally, 483 U.S. at 357. The Court also 
stated that the language of the second clause “is based 
on the statement in Durland that the statute reaches 
‘everything designed to defraud by representations as 
to the past or present, or suggestions and promises as 
to the future.’ ” McNally, 483 U.S. at 358 (quoting Dur- 
land, 161 U.S. at 313). In fact, however, the language of 
the second clause is virtually identical to language 
added to the federal lottery statute six years before 
Durland.8 And the legislative history of the 1909 

which is fully covered by another section, and are not essentially 

germane here.” S. Doc. 68, at xvii. 

7 The Commission may simply have been identifying all of the 
reported mail fraud decisions. Some of those decisions took incon- 
sistent positions with respect to the reach of the statute, which 
suggests that their mere citation does not indicate an intent to 
codify them. See Rakoff, 18 Duq. L. Rev. at 795-816 (contrasting 
the lower courts’ “broad constructionist” and “strict construc- 
tionist” approaches to the pre-1909 mail fraud statute). 

8 See Act of Sept. 19, 1890, ch. 908, §§ 1-3, 26 Stat. 465-466 
(prohibiting the use of the mails in connection with, inter alia, 
“schemes devised for the purpose of obtaining money or property 
under false pretenses”; authorizing the Postmaster General to 

18 

amendments does not reveal an intent to codify 
Durland. No member of Congress, the Executive 
Branch, or the Commission to Revise and Codify the 
Criminal and Penal Laws described the second clause 
as a codification of Durland. The only reference to 
Durland in the legislative history is in the string 
citation of 36 mail fraud decisions and Attorney General 
opinions in the Commission’s Report. If Congress had 
intended merely to codify the holding in Durland, its 
most natural course would have been to amend the first 
clause by inserting the words “whether by false pre- 
tenses, representations or promises” after the phrase 
“scheme or artifice to defraud.” But Congress did not 
choose that approach. Instead, Congress added a new 
clause employing the disjunctive “or”—a strong indica- 
tion that it intended to create an independent way of 
violating the statute. 

The absence of any legislative history of the 1909 
amendments addressing whether the second clause, like 
the first clause, contains a requirement that a victim be 
deprived of money or property—a requirement that is 
not evident on the face of the second clause—cannot 
constitute the requisite “extraordinary showing” of 
congressional intent needed to depart from the plain 
meaning of the statutory text. See Salinas, 522 U.S. at 
57; see also Standefer v. United States, 447 U.S. 10, 20 

n.12 (1980) (“an omission in the legislative history 

direct the return of registered mail involved in, inter alia, “any 

* * * scheme or device for obtaining money or property of any 
kind through the mails by means of false or fraudulent pretenses, 
representations, or promises”; authorizing the Postmaster General 
to forbid the payment of postal money orders in connection with, 
inter alia, “any * * * scheme for obtaining money or property of 
any kind through the mails by means of false or fraudulent pre- 
tenses, representations, or promises”). 

19 

[cannot] nullify the plain meaning of a statute”). 
Indeed, the 1909 amendments included other significant 
changes in the mail fraud statute that likewise went 
unremarked upon by Congress, including the 
elimination of the requirement that the defendant 
intended the fraudulent scheme to be effected through 
use of the mails. Compare 25 Stat. 873 with 35 Stat. 
1130; see Rakoff, 18 Duq. L. Rev. at 816. 

* * * 

In sum, while the second clause of Section 1341 
includes schemes to deprive a victim of his money or 
property, the second clause is not limited to such 
schemes. The plain language of the second clause 
authorizes convictions where the defendant acted to 
“obtain[] money or property by means of false or 
fraudulent premises, representations, or promises,” 
whether or not he also acted to deprive a victim of 
money or property.9 

9 Although the first question presented by the petition focuses 
on whether “a license that has not yet been issued constitutes 
‘property’ of the State,” Pet. i, the Court has the authority to 
affirm the court of appeals’ judgment on the alternative ground 
that the second clause of Section 1341 requires a scheme “for 
obtaining money or property” for the defendant (or another 
person), and does not require a scheme for depriving a victim of 
money or property. See Dayton Bd. of Educ. v. Brinkman, 433 
U.S. 406, 419 (1977) (“respondents * * * are entitled under our 
precedents to urge any grounds which would lend support to the 
judgment below”); see also Northwest Airlines, Inc. v. County of 
Kent, 510 U.S. 355, 364 (1994) (respondent may “defend a judgment 
on any ground properly raised below”). Although the government 
did not expressly raise that argument in the district court, the 
government did direct the district court’s attention to the Third 
Circuit’s decision in United States v. Martinez, 905 F.2d at 712-714, 
which held, inter alia, that the second clause of Section 1341 “is 
broad enough to cover a scheme to defraud a victim of something 

20 

B. The Scheme In This Case Violated The Second Clause 

Of Section 1341 Because Petitioner Sought To 

“Obtain[] Property” In The Form Of A State Video 

Poker License 

As explained above, in order to establish a violation 
of the second clause of Section 1341, the government 
must prove, inter alia, that the defendant’s fraudulent 
scheme was one “for obtaining money or property.” 
Here, the government charged petitioner with engag- 
ing in a scheme to obtain a video poker license for TSG, 
Ltd., a partnership in which petitioner had an undis- 
closed interest. A state video poker license, which has 
significant economic value to a licensee and which is 
protected against arbitrary suspension or revocation 
under state law, clearly constitutes property to the 
licensee. 

1. Section 1341 does not define the term “property.” 
Nor has the Court articulated any comprehensive 
definition of that term for purposes of Section 1341. 
The Court has recognized in other contexts, however, 
that the term “property” has “a naturally broad and 
inclusive meaning” that, according to its dictionary 
definition and “common usage,” comprehends “anything 

that takes on value only in the hands of the acquirer,” id. at 713. 
See Pet. App. 77a (noting the government’s reliance on Martinez). 
The district court quoted that language from Martinez with 
approval. Id. at 78a. And, on appeal, the government had no need 
to rely on the second clause because the Fifth Circuit had already 
held that Section 1341 reaches schemes to obtain a video poker 
licenses from the State of Louisiana before the present case was 
briefed and argued. See United States v. Salvatore, 110 F.3d 1131, 
cert. denied, 522 U.S. 981 (1997). In these circumstances, and 
particularly given that the question is essentially one of pure 
statutory construction, the Court may affirm the conviction based 
on the second clause of Section 1314. 

21 

of material value owned or possessed.” Reiter v. 
Sonotone Corp., 442 U.S. at 338. No reason exists to 
construe the term “property” in Section 1341 any more 
restrictively. See McNally, 483 U.S. at 358 (equating 
“property rights” with “something of value”) (quoting 
Hammerschmidt v. United States, 265 U.S. 182, 188 
(1924)); see also Carpenter v. United States, 484 U.S. 
19, 25 (1987) (holding that the first clause of Section 
1341 applies to schemes to defraud a victim of both 
tangible and intangible property rights). 

This Court and other courts have recognized, in a 
variety of contexts, that a license that permits a person 
to engage in an occupation, a business, or another 
money-making activity may constitute a form of prop- 
erty. For example, the Court held that an individual 
had a “property interest” in his state horse trainer’s 
license that was “sufficient to invoke the protection of 
the Due Process Clause.” Barry v. Barchi, 443 U.S. 55, 
64 (1979); see also, e.g., Mackey v. Montrym, 443 U.S. 1, 
10 (1979) (driver’s license); Bell v. Burson, 402 U.S. 535, 
542 (1971) (same); Beauchamp v. De Abadia, 779 F.2d 
773, 775 (1st Cir. 1985) (license to practice medicine); 
Keney v. Derbyshire, 718 F.2d 352, 354 (10th Cir. 1983) 
(same). Those decisions rest, in part, on the recognition 
that “[o]nce licenses are issued, * * * their continued 
possession may become essential in the pursuit of a 
livelihood.” Bell, 402 U.S. at 539. 

In addition, the courts have held that licenses to en- 
gage in a business or profession have sufficient indicia 
of property so as to be subject to a federal tax lien, 

10 

10 See, e.g., In re Kimura, 969 F.2d 806, 811 (9th Cir. 1992); In re 
Terwilliger’s Catering Plus, Inc., 911 F.2d 1168, 1170-1172 (6th 
Cir. 1990), cert. denied, 501 U.S. 1212 (1991); 21 W. Lancaster 

22 

that they qualify as property to which a security inter- 
est may be attached under the Uniform Commercial 
Code, 

11 and that they constitute property of a bank- 
rupt’s estate under the Bankruptcy Code, 11 U.S.C. 
541. 

12 The dispositive factor in those cases was whether 
the license “has pecuniary value to its holder.” In re 
Terwilliger’s Catering Plus, Inc., 911 F.2d 1168, 1171 
(6th Cir. 1990), cert. denied, 501 U.S. 1212 (1991); accord 
21 W. Lancaster Corp. v. Main Line Restaurant, Inc., 
790 F.2d 354 (3d Cir. 1986). While courts have also 
considered whether the license was transferrable for 
value, see, e.g., Terwilliger’s Catering Plus, 911 F.2d at 
1172, the inability to transfer a particular right does not 
deprive it of the character of property. See Drye v. 
United States, 120 S. Ct. 474, 482-483 n.7 (1999) (“In 
recognizing that state-law rights that have pecuniary 
value and are transferable fall within [the federal tax 
lien statute], we do not mean to suggest that trans- 
ferability is essential to the existence of ‘property’ or 
‘rights to property’ under that section.”). Even those 
courts that have held that an unissued license does not 
constitute property for purposes of the mail fraud 
statute acknowledge that a license may well be prop- 
erty in the hands of the licensee. 

13 

Corp. v. Main Line Restaurant, Inc., 790 F.2d 354, 356-358 (3d Cir. 
1986). 

11 See, e.g., In re O’Neill’s Shannon Village, 750 F.2d 679, 682- 
683 (8th Cir. 1984); Bogus v. American Nat’l Bank of Cheyenne, 

401 F.2d 458, 461 (10th Cir. 1968). 

12 See, e.g., Terwilliger’s Catering Plus, 911 F.2d at 1172; In re 
Rainbo Express, 179 F.2d 1, 5 (7th Cir.), cert. denied, 339 U.S. 981 
(1950); In re Fugazy Express, Inc., 114 B.R. 865, 869-871 (Bankr. 
S.D.N.Y. 1990). 

13 See, e.g., United States v. Granberry, 908 F.2d 278, 280 (8th 
Cir. 1990), cert. denied, 500 U.S. 921 (1991); United States v. Kato, 

23 

2. A Louisiana video poker license, once obtained by 
the licensee, fits comfortably within the common 
definition of property. It is clearly something “of mate- 
rial value owned or possessed” by the licensee. Reiter 

v. Sonotone, Inc., 442 U.S. at 338. 
A license issued pursuant to the Louisiana Video 
Draw Poker Devices Control Law, La. Rev. Stat. Ann. 
§ 27:301 et seq. (West 1989 & Supp. 2000), 

14 permits the 
licensee to engage in the video poker business at its 
truck stop, restaurant, hotel, or other authorized estab- 
lishment. See id. § 27:301(B)(8)). The licensee may 
thereby enhance substantially its financial return from 
the establishment. Indeed, because the operation of a 
licensed video poker establishment is so lucrative, 
licensees are willing to incur the thousands of dollars in 
application fees and annual license fees that the State 
imposes upon them. See id. § 27:311(A)-(D) and (H). 

15 

Although a licensee cannot transfer a video poker li- 
cense, see id. § 27:311(G), a licensee that owns or op- 

878 F.2d 267, 269 (9th Cir. 1989); Toulabi v. United States, 875 
F.2d 122, 125 (7th Cir. 1989); United States v. Murphy, 836 F.2d 
248, 253-254 (6th Cir.), cert. denied, 488 U.S. 924 (1988); United 
States v. Ferrara, 701 F. Supp. 39, 42 (E.D.N.Y.), aff ’d without 
opinion, 868 F.2d 1268 (2d Cir. 1988). Petitioner likewise ac- 
knowledges (Br. 10) that “a license may constitute property to the 
licensee.” 

14 Since the events at issue, the Louisiana Video Draw Poker 
Devices Control Law has been recodified. All citations are to the 
current codification (West 1989 & Supp. 2000). 

15 For example, a new applicant for a video poker license for a 
truck stop must pay a $10,000 “processing fee” to the State. See 
La. Rev. Stat. Ann. § 27:311(H)(2). Once the license is obtained, the 
licensee must pay an annual license fee to the state and, if the 
licensee is also the owner of the video poker devices, a quarterly 
“ franchise payment” based on a percentage of the net proceeds 
from the devices. See id. § 27:311(A)-(D). 

24 

erates a truck stop, as in this case, may lease or sub- 
lease any restaurant, convenience store, or other busi- 
ness on the premises, see id. § 27:306(A)(5)(b)). The 
location of licensed video poker devices at the truck 
stop may increase the value of such leases or subleases. 
Although the Video Gaming Division of the Louisiana 
State Police may revoke or suspend a video poker 
license on enumerated grounds, see id. § 27:308(B) and 
(C), the licensee has the right to challenge the revo- 
cation or suspension in a hearing before the Video 
Gaming Division and to judicial review by a state court, 
see id. § 27:310(E). 

In short, a video poker license, as created under 
Louisiana law, has economic value for its holder and is 
protected against arbitrary suspension or revocation. 
It therefore qualifies as property under the federal mail 
fraud statute. See United States v. Salvatore, 110 F.3d 
1131, 1141 (5th Cir.) (observing that “[i]n the hands of 
the licensee, the [video poker] license is ‘something of 
value,’ for it allows the licensee to operate the video 
poker machines and collect significant revenue from 
their use”), cert. denied, 522 U.S. 981 (1997). 

No contrary conclusion is required by the provision 
of the Louisiana Video Draw Poker Devices Control 
Law that states that a video poker license “is not 
property or a protected interest under the constitutions 
of either the United States or the state of Louisiana.” 
La. Rev. Stat. Ann. § 27:301(D). The question whether 
rights arising under state law constitute “money or 
property” within the meaning of Section 1341 is ulti- 
mately one of federal law. This Court recently con- 
sidered the similar question of whether a taxpayer’s 
right to a decedent’s estate, which was not property 
under state law, nonetheless was “property” or an “in- 
terest in property” under the federal tax lien statute, 26 

25 

U.S.C. 6321. Drye v. United States, 120 S. Ct. at 481- 
483. The Court concluded that “[t]he question whether 
a state-law right constitutes ‘property’ or ‘rights to 
property’ is a matter of federal law.” Id. at 481. The 
Court explained that “[w]e look initially to state law to 
determine what rights the taxpayer has in the property 
the Government seeks to reach, then to federal law to 
determine whether the taxpayer’s state-delineated 
rights qualify as ‘property’ or ‘rights to property’ 
within the compass of the federal tax lien legislation.” 
Ibid.; accord, e.g., In re Kimura, 969 F.2d 806, 810 (9th 
Cir. 1992) (a State cannot “defeat the federal tax lien by 
declaring an interest not to be property, even though 
the beneficial incidents of property belie its classi- 
fication”). 

That is precisely the analysis that applies here. As 
explained above, a video poker license, as created under 
Louisiana law, has substantial economic value to the 
licensee. In addition, the licensee enjoys a degree of 
protection under Louisiana law against the arbitrary 
suspension or revocation of the license. The license 
therefore qualifies as property under the federal mail 
fraud statute. 

C. The Indictment Charged And The Jury Necessarily 

Found That Petitioner Engaged In A Scheme To 

Obtain Property In Violation Of The Second Clause Of 

Section 1341 

The mail fraud counts in the indictment in this case 
charged petitioner under both the first and second 
clauses of Section 1341—that is, with having “willfully 
devised and intended to devise a scheme and artifice to 
defraud, and to obtain property by means of false and 
fraudulent pretenses and representations.” Supersed- 

26 

16 The indictment 
then proceeded to describe the alleged scheme as one 
“to defraud the State of Louisiana and its citizens by 
fraudulently obtaining and renewing, through the 
submission of false and incomplete information, state 
licenses to operate video poker sites for Truck Stop 
Gaming, Ltd.” Ibid. (emphasis added). 

The district court’s jury instructions referred the 
jury to the indictment’s description of the alleged 
scheme. Jury Instructions 27 (directing the jury to 
pages 26-28 of the indictment). The court had already 
advised the jury that a copy of the indictment would be 
available during its deliberations. Id. at 16. The court 
paraphrased the indictment by stating that the defen- 
dants were charged with having “knowingly devised a 
scheme to defraud the State of Louisiana and its citi- 
zens by fraudulently obtaining and renewing, through 
the submission of false and incomplete information, 
state licenses to operate video poker sites for Truck 
Stop Gaming, Ltd.” Id. at 27 (capitalization omitted). 
The court then instructed the jury that, in order to find 
the defendants guilty of mail fraud, the jury must find, 
among other things, that the defendants engaged in the 
scheme “as charged,” i.e., in the scheme to obtain and 
renew video poker licenses fraudulently. Ibid. 

The district court went on to conflate the separate 
requirements of the two clauses by instructing the jury 
that a “ ‘scheme to defraud’ includes any scheme to 
deprive another of money or property by means of false 
or fraudulent pretenses, representations, or promises.” 
Jury Instructions 28. But that instruction does not alter 
the fact that the jury was required to find all the 

16 The relevant paragraphs of the indictment and jury instruc- 
tions are set forth in appendices to this brief. 

ing Indictment 26 (emphasis added). 

27 

elements of a violation of the second clause—that is, 
that petitioner engaged in a fraudulent scheme to 
obtain property in the form of the license. 

Thus, given the district court’s instructions, the jury 
necessarily found that the petitioner engaged in a mail 
fraud scheme in violation of the second clause of Section 
1341. On the facts of this case, the jury could not have 
convicted petitioner of scheming to deprive the State of 
the license in violation of the first clause without 
concluding that he schemed to obtain the license in 
violation of the second clause. The government’s proof 
established that petitioner deprived the State of the 
license by obtaining it for an entity in which he had an 
undisclosed ownership interest. 

II. PETITIONER VIOLATED THE MAIL FRAUD 
STATUTE BY ENGAGING IN A SCHEME TO 
DEPRIVE THE STATE OF AN INTEREST IN 
PROPERTY 

Even if, contrary to our argument in Part I above, 
the government were required to prove that petitioner 
engaged in a scheme to deprive the State of Louisiana 
of money or property, that requirement was satisfied in 
this case. The State of Louisiana has a property inter- 
est in the video poker licenses that it issues. The 
licenses indisputably constitute “something of value,” 
McNally, 483 U.S. at 358, to the State. The State 
receives a substantial sum of money in exchange for a 
video poker license, continues to receive payments from 
the licensee for so long as the license remains in effect, 
and retains a significant degree of control over the 
license, including over the renewal, transfer, or revo- 
cation of the license. Accordingly, whether or not a 
government has a property interest in the other sorts 
of licenses that it issues (e.g., driver’s licenses, medical 

28 

licenses, export licenses), Louisiana does have a prop- 
erty interest in the particular license at issue here. 

We will begin with a discussion of the relevant 
provisions of the Louisiana Video Draw Poker Device 
Control Law. We will then explain why those provi- 
sions are sufficient to create a property interest on the 
part of the State in both unissued and issued video 
poker licenses. 

A. The Louisiana Video Draw Poker Device Control Law 

Vests The State With A Financial Stake In Video Poker 

Licenses And With Control Over How The Licenses 

Are Used 

Until the enactment of the Louisiana Video Draw 
Poker Device Control Law in 1991, video poker was 
illegal in Louisiana, as it remains in many States today. 
As the Fifth Circuit observed, “[o]ne of the main rea- 
sons for the * * * legalization of video poker [in 
Louisiana] was that it was considered an ongoing 
source of revenue for the State.” Salvatore, 110 F.3d at 
1141; accord Pet. App. 82a. 

The State profits from the licensing of video poker in 
several ways. First, an applicant for a video poker 
license must pay a sizable initial “processing fee,” which 
is $10,000 in the case of a truck stop owner; to renew a 
license, the State charges an additional “processing 
fee,” which is $1,000 in the case of a truck stop owner. 
La. Rev. Stat. Ann. § 27:311(H)(2) and (4). In addition, 
the State charges each holder of a video poker license 
an annual fee, the amount of which depends upon the 
type of license held; for example, the holder of a manu- 
facturer’s license is assessed an annual fee of $20,000, 
the holder of a device owner’s license is assessed an 
annual fee of $2,000, and the holder of an establishment 
license is assessed an annual fee of $100. Id. § 27:311(A). 

29 

The State also assesses an annual video poker device 
operation fee, imposed on the owner of the device, 
which amounts to $1,000 per device in the case of truck 
stops. Id. § 27:311(A)(5)(c) and (B). A truck stop may 
have as many as 50 video poker devices, depending 
on the amount of fuel sold at the truck stop. Id. 
§ 27:306(A)(4)(b). In 1995, the year in which petitioner 
and his co-defendants submitted the final license 
renewal application for TSG, Ltd., the State received a 
total of $10.8 million from those various fees. See 
Louisiana Legislative Fiscal Office, State Gaming 
Revenue—Sources and Uses 1 (Dec. 20, 1999) (State 
Gaming Revenue). 

The State’s chief source of revenue from video poker, 
however, is the quarterly “franchise payment,” which 
consists of a percentage of the net revenue from each 
licensed video poker device operated in the State. La. 
Rev. Stat. Ann. § 27:311(D). During the period at issue 
in this case (1992-1995), the State received between 

22.5% and 27.8% of the net revenue from each video 
poker device. State Gaming Revenue 1. Under current 
law, the State receives as much as 32.5% of the net 
revenue from video poker devices at truck stops and as 
much as 26% of the net revenue from video poker 
devices at restaurants, hotels, bars, and other such 
establishments. La. Rev. Stat. Ann. § 27:311(D). In 
1995, the State received a total of $141.5 million in such 
franchise payments; by 1999, the State’s annual receipts 
from franchise payments had grown to $188.6 million. 
State Gaming Revenue 1. While some of the State’s 
video poker revenue is allocated to gaming enforcement 
and related activity, the vast majority goes to the State 
General Fund ($109.6 million in 1995; $142.1 million in 
1999) and to local government ($30.3 million in 1995; 
$43.4 million in 1999). Ibid.; see La. Rev. Stat. Ann. § 

30 

27:312 (specifying division of funds received by the 
State from video poker). 

17 

The State, through the Video Gaming Division of the 
Louisiana State Police, exercises significant con- 
trol over virtually every aspect of the video poker 
industry. The State regulates, for example, how the 
game of video poker is played (La. Rev. Stat. Ann. 
§ 27:302(A)(5)(a)-(g)); the amount of money that may be 
played and the value of prizes (id. § 27:304); the 
expected payback (id. § 27:305(A)); the specifications of 
video poker devices (id. § 27:302(A)(1)-(4) and (5)(h)- 
(o)); the sorts of establishments that may be licensed for 
video poker (id. § 27:306(A)(2)-(4)); the physical 
placement and number of devices permitted within a 
licensed establishment (id. §§ 27:302(D), 27:306(A)(2) 
and (4)(a)); and physical security at licensed establish- 
ments (id. § 27:308(E)(5)). 

The licensing requirements that the State has 
imposed on those who seek to participate in the video 
poker industry in Louisiana are specifically designed to 
protect the economic viability of the industry. The 
section of the Louisiana Video Draw Poker Device Con- 
trol Law dealing with license qualifications recognizes 
“the importance of a controlled gaming industry to the 
development of the economy of the state of Louisiana.” 
La. Rev. Stat. Ann. § 27:306(A)(1). It further recog- 

17 On July 1, 1999, video poker was discontinued in 33 of Louisi- 
ana’s 64 parishes, in accordance with the results of local referenda 
conducted in 1996. See Gambling: The Trouble Is, It Makes 
Money, The Economist, July 31, 1999. Immediately before the 
shutdown, there were 15,914 video poker devices operating in 
Louisiana, 11,040 of which remained operating the next day. As of 
January 30, 2000, the number of operating video poker devices in 
Louisiana had risen to 11,792. Alan Sayre, Video Poker Edges 
Back In La., The Charleston Gazette, Feb. 28, 2000. 

31 

nizes that “the success and growth of gaming are 
dependent upon public confidence and trust that * * * 
video draw poker gaming activities are conducted hon- 
estly and are free from criminal and corruptive 
elements.” Ibid. Accordingly, the central requirement 
of the video poker licensing scheme is that applicants 
demonstrate their “suitability”—that is, that the 
applicant is a person of “good character, honesty, and 
integrity”; that the applicant’s “prior activities, arrest 
or criminal record if any, reputation, habits, and asso- 
ciations do not pose a threat to the public interest of 
[Louisiana] or to the effective regulation of video draw 
poker”; that the applicant is likely to conduct the video 
gaming business “in complete compliance” with state 
law; and that the applicant is not delinquent in tax or 
other financial obligations to the State or a local 
government. Id. § 27:310(B). 

The State retains a significant degree of control over 
video poker licenses after they have been issued. The 
State may revoke or suspend the license of any person 
who violates a provision of the Louisiana Video Draw 
Poker Device Control Law or the regulations promul- 
gated by the Video Gaming Division. La. Rev. Stat. 
Ann. § 27:308(B). The State also may revoke or sus- 
pend the license of any person who “did not meet, at the 
time of application, or does not continue to meet the 
suitability or other requirements” for a license. Id. 
§ 27:308(C). The State prohibits the transfer of a video 
gaming license to another person except in limited 
circumstances with the approval of the State. Id. 
§ 27:311(G); cf. id. § 27:306(D)(2) (permitting transfer of 
license from one truck stop to another in limited 
circumstances). 

32 

B. The State Has A Property Interest In Video Poker 

Licenses 

A video poker license has economic value to the 
State. As explained above, a video poker license 
represents the State’s right, under the Louisiana Video 
Draw Poker Device Control Law, to a stream of 
payments from the licensee. Those payments consist of 
the initial fees payable at the time of the application for 
the license, the annual license fees, and, where the 
licensee is the owner of video poker devices, quarterly 
franchise payments based on a percentage of the net 
proceeds from each device. See La. Rev. Stat. Ann. 
§ 27:311(A)-(D). The State controls who receives a 
video poker license, whether the license may be 
renewed, whether the license may be transferred, and, 
if a violation of state law is suspected, whether the 
license is suspended or revoked. See id. §§ 27:306, 
27:308(B) and (C), 27:311(G) 

1. The State has a property interest in a video poker 
license even before the license has been issued because, 
as the court of appeals put it, “the State expects to 
collect an up-front fee (before issuance) and a per- 
centage of net revenues (in the future) from the 
putative licensee.” Salvatore, 110 F.3d at 1141. Indeed, 
the State receives the first installment of revenue—the 
application fee and the initial annual license fee—at the 
time that the application for the license is filed. 

18 The 
license continues to generate revenue for the State 

18 See La. Admin. Code title 42, § 2405(A)(2) (2000) (application 
for a video poker license “is not complete nor is it considered filed 
with the division unless it is submitted with the appropriate fee”); 
id. § 2409(A)(1) and (2) (requiring applicants for video poker li- 
censes to pay, “[u]pon application, a nonrefundable annual [licens- 
ing] fee,” as specified in La. Rev. Stat. Ann. § 27:311(A)). 

33 

until the license expires or until the State suspends or 
revokes the license for cause. The State projects its 
anticipated revenue from video poker licenses into the 
future, see, e.g., State Gaming Revenue 1, and thus is in 
a position to plan its future spending based on those 
projections. 

When the State issues a video poker license, it is 
effectively “selling” the license to the applicant, in 
return for the payments that the State has already 
received and the right to additional payments over the 
term of the license. The State is thus receiving “money 
or property” in exchange for the license. And the appli- 
cant is receiving something that, as explained above 
(see pp. 20-25, supra), indisputably constitutes property 
as to him. It would be curious to conclude that, 
although the transaction involves an exchange by the 
applicant of one form of property (i.e., money) for 
another form of property (i.e., the license), the trans- 
action does not also involve an exchange of property for 
property by the State. See United States v. Frost, 125 
F.3d 346, 367 (6th Cir. 1997) (holding that a state uni- 
versity has a property interest in an unissued degree 
because, inter alia, “in return for tuition money and 
scholarly effort, [the university] agrees to provide an 
education and a degree”), cert. denied, 525 U.S. 810 
(1998); cf. United States v. Novod, 923 F.2d 970, 974 (2d 
Cir.) (dicta) (two judges suggest that the license award 
process “is tantamount to a contractual transaction 
where a buyer and seller agree on a mutually satisfac- 
tory exchange of consideration”), cert. denied, 500 U.S. 
919 (1991). 

The State’s interest in a video poker license that it 
has not yet issued also resembles, in certain respects, a 
patent holder’s interest in a patent that it has not yet 
licensed. It is well established that patents are a 

34 

“species of property.” Florida Prepaid Postsecondary 
Educ. Expense Bd. v. College Sav. Bank, 527 U.S. 627, 
642 (1999); see Consolidated Fruit Jar Co. v. Wright, 94 
U.S. 92, 96 (1877) (“A patent for an invention is as much 
property as a patent for land.”). “ ‘A patent,’ said Mr. 
Justice Holmes, ‘is property carried to the highest 
degree of abstraction—a right in rem to exclude, 
without a physical object or content.’ ” Mercoid Corp. v. 
Mid-Continent Inv. Co., 320 U.S. 661, 678 (1944) 
(Jackson, J., dissenting) (quoting 1 Holmes-Pollock 
Letters 53); accord Transparent-Wrap Mach. Corp. v. 
Stokes & Smith Co., 329 U.S. 637, 643 (1947) (describing 
a patent as “the exclusive right to make, use, and vend 
the invention or discovery for a limited period”) 
(internal quotation marks omitted); see also Kaiser 
Aetna v. United States, 444 U.S. 164, 176 (1979) (the 
right of exclusion is among “the most essential sticks in 
the bundle of rights that are commonly characterized as 
property”). Similarly, the State’s rights with respect to 
video poker in Louisiana include the right to exclude 
others from that business. The State has an exclusive 
right (subject to any previously issued licenses) to 
operate the video poker business itself; the State also 
has the right to prohibit all other persons within the 
State from engaging in that business, or to condition 
participation on compliance with whatever require- 
ments the State imposes. See pp. 37-39, infra. And, 
just as one of the most important attributes of a patent 
is the ability to exploit it for commercial gain through 
licensing, one of the most important attributes of 
Louisiana’s authority over video poker is the ability to 
exploit it financially through licensing. In both cases, 
the power to license others to participate in a particular 
economic activity, which they could not engage in 

35 

absent the license, furthers economic interests that 
qualify as property. 

2. In any event, the indictment in this case charged 
that petitioner and his co-defendants committed mail 
fraud by engaging in a scheme not only to obtain the 
video poker license for TSG, Ltd., initially in 1992, but 
also to obtain renewals of the license in 1993, 1994, and 
1995. Superseding Indictment 26-28. The jury was 
instructed accordingly. Jury Instructions 27. Whether 
or not the State had a property interest in the license 
before its issuance, the State did have a property 
interest in the license once it had been issued, and thus 
became property as to the licensee. 

The State has an ongoing economic stake in a video 
poker license issued under the Louisiana Video Draw 
Poker Device Control Law. As explained above, the 
State is entitled to an annual license fee from each video 
poker licensee, which ranges from $20,000 to $100 
depending on the category of license, and to quarterly 
franchise payments based on a percentage of the net 
revenues from each licensed video poker device. See 
La. Rev. Stat. Ann. § 27:311(A) and (D). The State is 
thus essentially in business with the licensee so long as 
the license remains in effect. The State protects its 
interest in the business through extensive regulation 
and monitoring of the licensed activity, including, for 
example, requiring that all licensed video poker devices 
be linked to a central state computer so that a record 
can be maintained of all money taken in and paid out in 
winnings. See id. § 27:302(A)(5)(o). 

Moreover, the State, not the licensee, controls the 
alienation of a video poker license. See La. Rev. Stat. 
Ann. § 27:311(G) (a video poker license “shall be per- 
sonal to the licensee to whom it was issued and shall not 

36 

19 The State also may suspend or 
revoke a license at any time, if the State determines 
that the licensee has violated the statute or failed to 
satisfy the suitability requirements. Id. § 27:308(B) and 
(C). It is well settled that a right often associated with 
the ownership of property is the right to control its 
alienation. See Loretto v. Teleprompter Manhattan 
CATV Corp., 458 U.S. 419, 435 (1982) (describing “pro- 
perty rights” as including the right to “dispose of ” pro- 
perty); accord Salvatore, 110 F.3d at 1140; cf. Car- 
penter, 484 U.S. at 26 (concluding that the Wall Street 
Journal had a property right in controlling the 
dissemination of its confidential business information). 

In United States v. Bucuvalas, 970 F.2d 937, 945 (1st 
Cir. 1992), cert. denied, 507 U.S. 959 (1993), the court of 
appeals held that, once the City of Boston issued liquor 
and entertainment licenses to the defendants, the City 
had a property interest in those licenses for purposes of 
the mail fraud statute, because the licenses had to be 
renewed annually, could be revoked by the City based 
on the occurrence of prescribed contingencies, and 
could be transferred only with the City’s approval. 
“[A]t the very least,” the court explained, “defendants 
repeatedly deprived the City of Boston of its reversion- 
ary interest in the fraudulently obtained licenses by 
renewing and transferring the licenses in the names of 
straw owners.” Ibid. Similarly, here, even if the video 
poker license did not become property until the State 

19 See also, e.g., La. Rev. Stat. Ann. § 27:306(E) (if an establish- 
ment licensed for video poker is sold, the purchaser must apply for 
a new license, although the establishment may continue to offer 
video poker in the interim); id. § 27:306(D)(2)(b) (authorizing truck 
stop operators that have lost their leases to transfer video poker 
licenses to other establishments in limited circumstances). 

be transferable”). 

37 

issued the license to TSG, Ltd., the State thereafter 
possessed a property interest in the license, because 
the State, not TSG, Ltd., retained control over whether, 
and in what circumstances, the license could be 
retained, revoked, transferred, or renewed. Petitioner 
and his co-defendants, by submitting license renewal 
applications that concealed the true owners of TSG, 
Ltd., deprived the State of that right. 

3. A video poker license, as created under Louisiana 
law, may also be viewed as a franchise—that is, a right 
held exclusively by the government to engage in a 
particular business activity, which the government may 
exercise directly or delegate to private parties “acting 
under such conditions and regulations as the govern- 
ment may impose.” California v. Central Pac. R.R., 
127 U.S. 1, 40-41 (1888); see id. at 40 (reciting tradi- 
tional definition of a “franchise” as “a royal privilege, or 
branch of the king’s prerogative, subsisting in the 
hands of a subject”) (quoting 2 W. Blackstone, Com- 
mentaries 37). 

20 As the Court has explained, a franchise 
“belong[s] to the State,” which “could carry on the 
business itself or select one or several agents to do so.” 
New Orleans Gas Co. v. Louisiana Light Co., 115 U.S. 
650, 660 (1885). A franchise, “when conferred upon the 
citizen,” thus remains “[a] right which belongs to the 
government.” Borre v. United States, 940 F.2d 215, 220 

20 In Frost v. Corporation Commission, 278 U.S. 515, 520 (1929), 
the Court offered various examples of franchises: “the right to 
supply gas or water to a municipality and its inhabitants, the right 
to carry on the business of a telephone system, to operate a rail- 
road, a street railway, city water works or gas works, to build a 
bridge, operate a ferry, and to collect tolls therefor.” The Court 
added that “these are but illustrations of a more comprehensive 
list,” ibid., which the Court held to include the right to operate a 
cotton gin at issue in that case, id. at 520-521. 

38 

(7th Cir. 1991); accord Maestri v. Board of Assessors, 34 
So. 658, 661 (La. 1903) (“a franchise is defined to be a 
royal privilege in the hands of a subject”). 

21 The Court 
has recognized, albeit in addressing the rights of 
franchisees, that franchises “have elements of prop- 
erty.” Tennessee Elec. Power Co. v. TVA, 306 U.S. 118, 
139 (1939); accord Frost v. Corporation Comm’n, 278 
U.S. 515, 521 (1929). 

In Borre, the court of appeals held that a municipality 
had a property interest in a cable television franchise, 
which the court described as “a delegation of a govern- 
mental function to private entities to be performed in 
the furtherance of the public welfare.” 940 F.2d at 220 
(quoting 1 D. Ferris et al., Cable Television Law 
§ 13.13, at 13-68.11 (1990)). The court noted that the 
municipality could have chosen to operate the cable 
television franchise itself rather than award it to a 
private party. Id. at 220-221; see also United States v. 
Italiano, 894 F.2d 1280, 1285 n.6 (11th Cir. 1990) 
(“Clearly the cable television franchise held by the 
County of Hillsborough for the people of that county to 
be awarded to some commercial entity is ‘property,’ and 
the attempt by appellant to secure the cable television 
franchise by bribery is a scheme to deprive the county 
and its people of that property.”). 

21 Thus, the government retains authority over whether a 
franchise may be transferred. See Louisiana v. Morgan, 28 La. 
Ann. 482, 488 (“[T]he franchises of a railroad corporation cannot be 
alienated without the consent of the State which granted them. As 
all franchises belong exclusively to the State, no one will be 
permitted to possess and administer any of them without the 
consent of the State.”), aff ’d, 93 U.S. 217 (1876); accord Branch v. 
Jesup, 106 U.S. 468, 478 (1883) (observing that franchises “are 
generally inalienable” unless the government has provided other- 
wise). 

39 

The right to engage in the video poker business, like 
the right to engage in the cable television business, is a 
“right which belongs to the government,” to be exer- 
cised by the government alone or “conferred on a 
citizen.” Borre, 940 F.2d at 220. The State of Louisiana 
could, of course, have chosen to operate the video poker 
business itself. It is not unusual for States to conduct 
their own gaming operations—such as lotteries, keno 
games, 

22 and sports wagering 

23—as a means of raising 
public revenues. Indeed, in Oregon, video poker is run 
by the State, which owns the video poker devices and 
licenses them to proprietors in return for a share of the 
profits. See Or. Rev. Stat. § 461.215 (1997). By con- 
trast, Louisiana chose to confer the authority to operate 
video poker devices on suitable private parties. In 
return, the State receives valuable consideration, in the 
forms of initial and annual license fees and a continuing 
share in the revenue generated by video poker within 
the State, and retains a significant degree of control 
over the video poker industry. Indeed, by characteriz- 
ing the State’s share of the net proceeds from a licensed 
video poker device as a “franchise payment,” see La. 
Rev. Stat. Ann. § 27:311(D), the State has indicated 
that it views video poker as a government franchise. 

4. Petitioner contends (Br. 17-22) that the State of 
Louisiana has merely a regulatory interest, not a 
property interest, in a video poker license. He relies 
primarily on cases involving other sorts of government 
licenses, such as driver’s licenses, medical licenses, and 

22 See, e.g., Md. Regs. Code title 14, § 14.01.03.12 (2000); 77 Md. 
Op. Att’y Gen. 82 (1992). 

23 See, e.g., N.Y. Rac. Pari-Mut. Wag. & Breed. Law § 502 
(McKinney 2000) (off-tracking betting); Or. Rev. Stat. §§ 461.213, 
461.543 (1997) (sports wagering). 

40 

export licenses. But the Court need not decide in this 
case whether a State has a property interest in all of 
the varieties of licenses that it issues. The Court need 
conclude only that the State of Louisiana has an 
interest in the particular variety of license at issue here 
—a license under which the State retains a substantial 
economic stake in the licensed activity. None of the 
cases on which petitioner relies involved such a license. 
See United States v. Shotts, 145 F.3d 1289, 1294 (11th 
Cir. 1998) (concluding that “[a] particular license may 
signify nothing more than an intent to regulate, while 
another type of license may signify the state’s intent to 
participate in that industry”) (citing Salvatore, 110 F.3d 
at 1141). 

A video poker license does not constitute a mere 
“promise not to interfere” with the licensee’s conduct of 
a business, profession, or other activity, as may the 
sorts of licenses that have been described as reflecting 
“a regulatory rather than property interest” on the part 
of the government. E.g., Toulabi v. United States, 875 
F.2d 122, 125 (7th Cir. 1989). As the court of appeals 
explained in Salvatore, “Louisiana has much more than 
a regulatory interest in the video poker licenses; it has 
a direct and significant financial stake in its role as 
issuer of the licenses.” 110 F.3d at 1142. Indeed, the 
Seventh Circuit, after concluding in Toulabi that a 
municipality did not have a property interest in a taxi 
driver’s license, concluded that a municipality did have 
a property interest in the cable television franchise, 
which the court found to “represent[] far more than a 
mere ‘promise not to interfere’ by the government.” 
Borre, 940 F.2d at 219-221. As explained above, a video 
poker license is analogous to a franchise: a privilege 
conferred on a private party to operate a particular 
business in return for valuable consideration. 

41 

5. Petitioner also argues (Br. 22-26) that the Court 
should construe the mail fraud statute to exclude 
schemes to obtain a state license by fraudulent means, 
invoking the Court’s statement in United States v. 
Bass, 404 U.S. 336, 349 (1971), that “unless Congress 
conveys its purpose clearly, it will not be deemed to 
have significantly changed the federal-state balance.” 
Congress has left no doubt, however, that Section 1341 
“reach[es] any scheme to deprive another of money or 
property by means of false or fraudulent pretenses, 
representations, or promises.” Carpenter, 484 U.S. at 
27 (emphasis added); see also United States v. Gon- 
zales, 520 U.S. 1, 5 (1997) (“Read naturally, ‘any’ has an 
expansive meaning.”). In McNally, the Court recog- 
nized that “[t]he mail fraud statute clearly protects 
property rights,” 483 U.S. at 356, and “is to be inter- 
preted broadly insofar as property rights are con- 
cerned,” ibid. Accordingly, to the extent that Louisiana 
has a property right in a video poker license, as created 
under state law, Congress has clearly expressed its 
purpose to protect that right under Section 1341. Cf. 
Salinas, 522 U.S. at 59-60. 

Nothing in the text or history of the mail fraud 
statute provides any justification for varying the scope 
of protected property rights depending on the identity 
of the victim. Indeed, given that schemes to defraud a 
State of money or property rights often involve 
powerful state officials (as the indictment charged in 
this case), the State may not be well positioned to 
investigate or prosecute the fraud itself. Section 1341 is 
particularly necessary in such cases to protect against 
frauds involving the use of the U.S. mails, which have 
historically been an area of particular federal concern. 
See, e.g., In re Rapier, 143 U.S. 110, 134 (1892) (“It is 
not necessary that Congress should have the power to 

42 

deal with crime or immorality within the States in 
order to maintain that it possesses the power to forbid 
the use of the mails in aid of the perpetration of crime 
or immorality.”); see also Badders v. United States, 240 
U.S. 391, 393 (1916); Ex parte Jackson, 96 U.S. 727 
(1877). 

C. Congress’s Enactment Of 18 U.S.C. 1346 Has No 

Bearing On Any Issue Presented In This Case 

Petitioner finally contends (Br. 37) that the post- 
McNally enactment of 18 U.S.C. 1346—which ex- 
panded the definition of a “scheme or artifice to 
defraud” under the mail, wire, and bank fraud statutes 
to include “a scheme or artifice to deprive another of 
the intangible right of honest services”—“demonstrates 
that [Congress] did not intend the mail fraud statute to 
cover deceptions in state license applications.” But the 
intent of the Congress that enacted Section 1346 in 1988 
is irrelevant to any issue in this case. This case was not 
charged under Section 1346 as involving a scheme to 
deprive Louisiana or its citizens of an intangible right. 
The case was instead charged as involving “a scheme 
and artifice to defraud, and to obtain property by means 
of false and fraudulent pretenses and representations” 
in violation of 18 U.S.C. 1341 and 18 U.S.C. 2. 
Superseding Indictment 26, 28. The property at issue 
was specifically identified in the indictment as “state 
licenses to operate video poker sites for Truck Stop 
Gaming, Ltd.” Id. at 26. The indictment nowhere 
mentioned Section 1346 or “intangible rights.” 

Congress did not purport in the post-McNally legis- 
lation to restrict the definition of property rights under 
the existing mail, wire, and bank fraud statutes. 
Rather, Congress included an additional category of 
rights, which the Court had held in McNally could not 

43 

be the object of a “scheme to defraud” as then under- 
stood, within the protection of those statutes. See 134 
Cong. Rec. 33,297 (1988) (statement of Rep. Conyers) 
(Section 1346 “is intended merely to overturn the 
McNally decision. No other change in the law is 
intended.”). 

24 

Petitioner argues (Br. 37) that Congress would have 
included in Section 1346 an “intangible right * * * to 
run a licensing program based on full and complete 
information” if Congress had intended that the mail 
fraud statute reach schemes to obtain a government 
license by fraud. Petitioner reads too much into Con- 
gress’s silence. Congress may have anticipated that 
most schemes involving fraud in license applications 
could be reached without further statutory addition— 
either under the existing mail and wire fraud statutes, 
at least to the extent that the scheme involved a license 

24 Section 1346 was adopted as part of the Anti-Drug Abuse Act 
of 1988, Pub. L. No. 100-690, Title VII, Subtitle O, § 7603(a), 102 
Stat. 4508. The provision was not discussed in a committee report 
or debated on the floor of either House. See Adam H. Kurland, 
The Guarantee Clause as a Basis for Federal Prosecutions of 
State and Local Officials, 62 So. Cal. L. Rev. 367, 488-489 nn.450- 
452 (1989) (discussing legislative history of Section 1346). The first 
statement quoted in the text is from Representative Conyers, the 
chairman of the Subcommittee on Criminal Justice of the House 
Judiciary Committee, which had held hearings on the impact of 
McNally on federal criminal prosecutions. See 134 Cong. Rec. at 
33,296-33,297. Representative Conyers, while supporting the pro- 
vision that became Section 1346, voted against the Anti-Drug 
Abuse Act. Id. at 33,318. No other member of Congress expressed 
any disagreement with Representative Conyers’ statement that 
Section 1346 was not intended to effect any change in the law other 
than the overturning of McNally. See id. at 32,708 (statement of 
Senator Biden) (Section 1346 “overturns the decision in 
McNally”). 

44 

in which the government had a property interest, or 
under the new “honest services” provision, to the ex- 
tent that the scheme involved the corruption of govern- 
ment officials. See, e.g., United States v. Alkins, 925 
F.2d 541, 549 (2d Cir. 1991 (affirming mail fraud convic- 
tion of state employees and others under Section 1346 
for engaging in a scheme to issue fraudulent vehicle 
registrations). Or Congress may (if it even recognized 
that any question existed) simply have chosen to 
address license procurement schemes at a later time, or 
to leave the question to the courts in the first instance. 

CONCLUSION 

The judgment of the court of appeals should be 
affirmed. 

Respectfully submitted. 

SETH P. WAXMAN 

Solicitor General 

JAMES K. ROBINSON 

Assistant Attorney General 

MICHAEL R. DREEBEN 

Deputy Solicitor General 

BARBARA MCDOWELL 

Assistant to the Solicitor 

General 

JOEL M. GERSHOWITZ 

Attorney 

AUGUST 2000 

APPENDIX A 

Section 1341 of Title 18 of the United States Code 
provides: 

Whoever, having devised or intending to devise any 
scheme or artifice to defraud, or for obtaining money or 
property by means of false or fraudulent pretenses, 
representations, or promises, or to sell, dispose of, loan, 
exchange, alter, give away, distribute, supply, or 
furnish or procure for unlawful use any counterfeit or 
spurious coin, obligation, security, or other article, or 
anything represented to be or intimated or held out to 
be such counterfeit or spurious article, for the purpose 
of executing such scheme or artifice or attempting so to 
do, places in any post office or authorized depository for 
mail matter, any matter or thing whatever to be sent or 
delivered by the Postal Service, or deposits or causes to 
be deposited any matter or thing whatever to be sent 
or delivered by any private or commercial interstate 
carrier, or takes or receives therefrom, any such matter 
or thing, or knowingly causes to be delivered by mail or 
such carrier according to the direction thereon, or at 
the place at which it is directed to be delivered by the 
person to whom it is addressed, any such matter or 
thing, shall be fined under this title or imprisoned not 
more than five years, or both. If the violation affects a 
financial institution, such person shall be fined not more 
than $1,000,000 or imprisoned not more than 30 years, 
or both. 

(1a) 

2a 

APPENDIX B 

The mail fraud count of the superseding indictment 
alleged as follows: 

COUNTS 3 THROUGH 6 
(MAIL FRAUD) 

A. THE SCHEME: 

Beginning on an exact date unknown, but in or before 
February 1992, and continuing until the date of this 
indictment, in the Eastern District of Louisiana, and 
elsewhere, the listed defendants, and others, known 
and unknown to the Grand Jury, knowingly and will- 
fully devised and intended to devise a scheme and 
artifice to defraud, and to obtain property by means of 
false and fraudulent pretenses and representations; 
that is, to defraud the State of Louisiana and its citizens 
by fraudulently obtaining and renewing, through the 
submission of false and incomplete information, state 
licenses to operate video poker sites for Truck Stop 
Gaming, Ltd. 

It was part of the scheme and artifice to defraud, 
that, in connection with attempts to obtain licenses and 
license renewals for Truck Stop Gaming, Ltd., the 
defendants filed, and caused to be filed, with the 
Louisiana State Police applications, affidavits, and 
other documents which concealed and failed to disclose: 

1. Understandings and agreements with 
unreported parties: 

a. pledging and assigning interests in 
Truck Stop Gaming, Ltd; 

3a 

b. agreeing to hold interests in Truck 
Stop Gaming, Ltd., as an “agent, 
nominee or otherwise” on behalf of said 
unreported party; and 

c. agreeing to transfer said interests, on 
some future date, to said unreported 
party; and 

2. other factors that could impact the ability of 
the true owners to obtain licenses. 

It was further part of the scheme and 
artifice to defraud that the defendants filed income 
tax returns which listed the GOODSON children as 
owning, directly and indirectly, 100% of Truck Stop 
Gaming, Ltd. 

B. MAILINGS 

On or about the dates listed below, in the Eastern 
District of Louisiana and elsewhere, the listed defen- 
dants, for the purpose of executing the scheme set forth 
above in Part A, and attempting to do so, did knowingly 
cause to be delivered by the United States Postal 
Service according to the directions thereon, and did 
take and receive, and cause to be taken and received 
from an authorized depository for mail matter, the 
following items having been mailed from the Depart- 
ment of Public Safety and Corrections, Office of 
Louisiana State Police, Baton Rouge, Louisiana, to 

4a 

Truck Stop Gaming, Ltd., P.O. Box 1361, Slidell, 
Louisiana, to wit: 

COUNT DATE DEFENDANTS 
ITEM MAILED 

FROM/TO 

3 05/18/92 CARL CLEVELAND License No. 

FRED GOODSON 
5207600111, Office 

MARIA GOODSON 

Tracking No. 

000142, issued to 

Truck Stop Gam- 
ing, Ltd. 

4 07/07/93 CARL CLEVELAND License No. 

FRED GOODSON 
5207600111, Office 

MARIA GOODSON 

Tracking No. 

JOE MORGAN 

013616, issued to 

Truck Stop Gam- 
ing, Ltd. 

5 06/02/94 CARL CLEVELAND License No. 

FRED GOODSON 
5207600111, Office 

MARIA GOODSON 

Tracking No. 

JOE MORGAN 

020606, issued to 

Truck Stop Gam- 
ing, Ltd. 

6 05/25/95 CARL CLEVELAND License No. 

FRED GOODSON 
5207600111, Office 

MARIA GOODSON 

Tracking No. 

JOE MORGAN 

014718, issued to 

Truck Stop Gam- 
ing, Ltd. 

All in violation of Title 18, United States Code, 
Sections 1341 and 2. 

5a 

APPENDIX C 

The district court’s instructions to the jury on the 
mail fraud count stated as follows: 

MAIL FRAUD: COUNTS 3 THROUGH 6 AND 
“RACKETEERING ACTS” 1a THROUGH 1d 

TITLE 18, UNITED STATES CODE, SECTION 1341, 
MAKES IT A CRIME FOR ANYONE TO USE THE 
UNITED STATES MAILS IN CARRYING OUT A 
SCHEME TO DEFRAUD. FOUR OF THE SIX DEFEN- 
DANTS ARE CHARGED WITH MAIL FRAUD IN 
VIOLATION OF TITLE 18, UNITED STATES CODE, 
SECTION 1341. DEFENDANTS CARL CLEVELAND, 
FRED GOODSON, AND MARIA GOODSON ARE EACH 
CHARGED WITH MAIL FRAUD IN COUNTS 3, 4, 5, 
AND 6 AND “RACKETEERING ACTS” 1(a), 1(b), 1(c), 
AND 1(d). JOE MORGAN IS CHARGED WITH MAIL 
FRAUD IN COUNTS 5 AND 6 AND RICO PREDICATE 
ACTS 1(c) AND 1(d). THE SUPERSEDING INDICT- 
MENT CHARGES THAT THE LISTED DEFENDANTS 
KNOWINGLY DEVISED A SCHEME TO DEFRAUD 
THE STATE OF LOUISIANA AND ITS CITIZENS BY 
FRAUDULENTLY OBTAINING AND RENEWING, 
THROUGH THE SUBMISSION OF FALSE AND 
INCOMPLETE INFORMATION, STATE LICENSES TO 
OPERATE VIDEO POKER SITES FOR TRUCK STOP 
GAMING, LTD. THE MAIL FRAUD CHARGES ARE 
SET FORTH ON PAGES 26-28 OF THE SUPERSEDING 
INDICTMENT. 

FOR YOU TO FIND A DEFENDANT GUILTY OF 
THE CRIME OF MAIL FRAUD, YOU MUST BE CON- 
VINCED THAT THE GOVERNMENT HAS PROVED 

6a 

EACH OF THE FOLLOWING ELEMENTS BEYOND A 
REASONABLE DOUBT AS TO THAT DEFENDANT: 

FIRST, THAT THE DEFENDANT UNDER CON- 
SIDERATION KNOWINGLY CREATED A SCHEME TO 
DEFRAUD, AS CHARGED IN THE INDICTMENT; 

SECOND, THAT THE DEFENDANT UNDER CON- 
SIDERATION ACTED WITH A SPECIFIC INTENT TO 
COMMIT FRAUD; 

THIRD, THAT THE DEFENDANT UNDER CON- 
SIDERATION MAILED SOMETHING OR CAUSED 
ANOTHER PERSON TO MAIL SOMETHING FOR THE 
PURPOSE OF CARRYING OUT THE SCHEME. 

A “SCHEME TO DEFRAUD” INCLUDES ANY 
SCHEME TO DEPRIVE ANOTHER OF MONEY OR 
PROPERTY BY MEANS OF FALSE OR FRAUDULENT 
PRETENSES, REPRESENTATIONS, OR PROMISES. 
THE SCHEME MUST INVOLVE FALSE OR FRAUDU- 
LENT REPRESENTATIONS OR OMISSIONS REASON- 
ABLY CALCULATED TO DECEIVE PERSONS OF 
ORDINARY PRUDENCE AND COMPREHENSION. 

FOR THE PURPOSES OF MAIL FRAUD, A REPRE- 
SENTATION MAY BE “FALSE” WHEN IT CON- 
STITUTES A HALF TRUTH, OR EFFECTIVELY CON- 
CEALS A MATERIAL FACT, PROVIDED IT IS MADE 
WITH INTENT TO DEFRAUD. 

IT IS NOT NECESSARY THAT THE GOVERNMENT 
PROVE ALL OF THE DETAILS ALLEGED IN THE 
INDICTMENT CONCERNING THE PRECISE NA- 
TURE AND PURPOSE OF THE SCHEME, OR THAT 
THE MATERIAL MAILED WAS ITSELF FALSE OR 

7a 

FRAUDULENT, OR THAT THE ALLEGED SCHEME 
ACTUALLY SUCCEEDED IN DEFRAUDING ANY- 
ONE, OR THAT THE USE OF THE MAIL WAS 
INTENDED AS THE SPECIFIC OR EXCLUSIVE 
MEANS OF ACCOMPLISHING THE ALLEGED 
FRAUD. 

WHAT MUST BE PROVED BEYOND A REA- 
SONABLE DOUBT IS THAT THE DEFENDANT 
KNOWINGLY DEVISED OR INTENDED TO DEVISE A 
SCHEME TO DEFRAUD THAT WAS SUBSTAN- 
TIALLY THE SAME AS THE ONE ALLEGED IN THE 
INDICTMENT AND THAT THE USE OF THE U.S. 
MAILS WAS CLOSELY RELATED TO THE SCHEME, 
IN THAT THE DEFENDANT EITHER MAILED SOME- 
THING OR CAUSED IT TO BE MAILED IN AN 
ATTEMPT TO EXECUTE OR CARRY OUT THE 
SCHEME. TO “CAUSE” THE MAILS TO BE USED IS 
TO DO AN ACT WITH KNOWLEDGE THAT THE USE 
OF THE MAILS WILL FOLLOW IN THE ORDINARY 
COURSE OF BUSINESS OR WHERE SUCH USE CAN 
REASONABLY BE FORESEEN. EACH SEPARATE 
USE OF THE MAILS IN FURTHERANCE OF A 
SCHEME TO DEFRAUD CONSTITUTES A SEPARATE 
OFFENSE. 

8a