Law School Case Brief
Neder v. United States - 527 U.S. 1, 119 S. Ct. 1827 (1999)
Safeguarding the constitutional jury guarantee often requires that a reviewing court conduct a thorough examination of the record. If, at the end of that examination, the court cannot conclude beyond a reasonable doubt that the jury verdict would have been the same absent the error, for example, where the defendant contested the omitted element from a jury instruction and raised evidence sufficient to support a contrary finding, it should not find the error harmless.
Petitioner Neder was convicted of filing false federal income tax returns and of federal mail fraud, wire fraud, and bank fraud. At trial, the District Court determined that materiality with regard to the tax and bank fraud charges was not a question for the jury and found that the evidence established that element. The court did not include materiality as an element of either the mail fraud or wire fraud charges. The Eleventh Circuit affirmed. It held that the District Court's failure to submit the materiality element of the tax offense to the jury was error under United States v. Gaudin, 515 U.S. 506, 132 L. Ed. 2d 444, 115 S. Ct. 2310, but that the error was subject to harmless-error analysis and was harmless because materiality was not in dispute and thus the error did not contribute to the verdict. The court also held that materiality is not an element of a "scheme or artifice to defraud" under the mail fraud, wire fraud, and bank fraud statutes, 18 U.S.C. §§ 1341, 1342, 1344, and thus the District Court did not err in failing to submit materiality to the jury.
Was the failure to submit the materiality element to the jury with respect to federal tax fraud charges a harmless error?
The United States Supreme Court held the failure to instruct the jury as to materiality, an element of tax fraud under 26 U.S.C.S. § 7206(1), was subject to harmless-error analysis because the error did not render the trial fundamentally unfair. The court found the error was harmless because the error did not, beyond a reasonable doubt, contribute to the verdict, Neder did not contest materiality, which was supported by overwhelming evidence, and the jury verdict would have been the same even if instruction was proper. Materiality was an element of mail, wire, and bank fraud because the terms in the statute were given their established common law meaning, which included materiality. The judgment was reversed and remanded only for consideration of whether the failure to instruct the jury on materiality with respect to mail, wire, and bank fraud was harmless error. The judgment affirming the tax fraud conviction was affirmed.
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