Eleventh Circuit Court of Appeals - Published Opinions

Friday, June 29, 2012

Merrill: Fraudulent Chinese Ammunition Sales

In U.S. v. Merrill, No. 11-11432 (June 27, 2012), the Court affirmed convictions for conspiracy to commit false statements, major fraud, and wire fraud against the United States, in violation of 18 U.S.C. § 371, and for major fraud and wire fraud, in violation of 18 U.S.C. § 1031, 1343. The charges arose out of sales of Chinese ammunition to the United States Army in contravention of a contract that prohibited the delivery of weapons acquired, directly or indirectly, from a Communist Chinese military company.
The Court rejected the argument that the sale did not violate the contract because the ammunition had been acquired from China before the United States law prohibited purchases of ammunition from Chinese companies. The Court noted that the prohibition encompassed pre-prohibition ammunition.
The Court held that the trial court did not err when it excluded evidence, proffered by the defense, that the government knew the Chinese origin of the ammunition it was purchasing. Citing the holding in U.S. v. Neder, 197 F.3d 1122 (11th Cir. 1999) that a false statement can be material even if the decision maker knew it was false, the Court rejected Merrill’s argument that "a lie is only a lie if it works."

The Court rejected the argument that the district court should not have admitted admissions made during "plea negotiations," pointing out that Merrill had not been charged with any crimes at the time of his discussions with government officials, and that no specific promises of leniency were made.
The Court rejected the argument that the government should have produced government agents’ handwritten notes taken during interviews of Merrill. The Court held that agents’ accounts of Merrill’s testimony were not "transcriptions of Merrill’s words," and therefore not subject to production under Fed. R. Crim. P. 26.2(a).
The Court held that the district court did not err in declining to grant a defense witness use immunity, pointing out that only the Executive Branch can grant use immunity.