No. 18-1059
IN THE

Supreme Court of the United States
BRIDGET ANNE KELLY,
Petitioner,
v.
UNITED STATES,
Respondent.
On Writ Of Certiorari
To The United States Court Of Appeals
For The Third Circuit
BRIEF FOR PETITIONER
MICHAEL D. CRITCHLEY
CRITCHLEY, KINUM
& DENOIA, LLC
75 Livingston Avenue
Roseland, NJ 07068

YAAKOV M. ROTH
Counsel of Record
MICHAEL A. CARVIN
ANTHONY J. DICK
ANDREW J. M. BENTZ
JONES DAY
51 Louisiana Ave., NW
Washington, DC 20001
(202) 879-3939
yroth@jonesday.com

Counsel for Petitioner

 i
QUESTION PRESENTED
Does a public official “defraud” the government of
its property by advancing a “public policy reason” for
an official decision that is not her subjective “real
reason” for making the decision?

 ii
TABLE OF CONTENTS
Page
QUESTION PRESENTED..........................................i
TABLE OF AUTHORITIES ......................................iv
INTRODUCTION ....................................................... 1
OPINIONS BELOW ................................................... 6
JURISDICTION ......................................................... 6
PROVISIONS INVOLVED ........................................ 6
STATEMENT ............................................................. 6
A. The Port Authority and Its
Governance .................................................... 7
B. The George Washington Bridge ................... 8
C. The Lane Realignment ................................. 9
D. The Indictment and Trial ........................... 11
E. The Third Circuit’s Decision....................... 14
ARGUMENT ............................................................ 16
I.

THE GOVERNMENT’S SWEEPING
CONCEPTION OF “PROPERTY FRAUD”
IS DANGEROUSLY WRONG ................................... 18
A. The Government’s Theory
Criminalizes Politics and Chills
Public Service .............................................. 19
B. The Government’s Theory End-Runs
the Honest-Services Doctrine ..................... 29

 iii
TABLE OF CONTENTS
(continued)
Page
C. The Government’s Theory Is
Anathema to Every Canon of
Construction ................................................ 34
II. REALIGNING THE LANES DID NOT DEPRIVE
THE PORT AUTHORITY OF PROPERTY,
REGARDLESS OF THE DEFENDANTS’
SUBJECTIVE MOTIVES ......................................... 35
A. Depriving a State of Regulatory
Control Is Not Property Fraud ................... 37
B. An Official Does Not Defraud
the State by Misusing Property
He Controls ................................................. 44
C. An Official Does Not Commit
Fraud by Lying about His
Subjective Motives ...................................... 49
CONCLUSION ......................................................... 53

 iv
TABLE OF AUTHORITIES
Page(s)
CASES
Carpenter v. United States,
484 U.S. 19 (1987) .......................................... 45, 53
Casa De Maryland v. U.S. Dep’t of
Homeland Sec.,
284 F. Supp. 3d 758 (D. Md. 2018) ...................... 23
City of Columbia v. Omni Outdoor
Advertising, Inc.,
499 U.S. 365 (1991) .............................................. 22
Cleveland v. United States,
531 U.S. 12 (2000) ........................................ passim
Crawford-El v. Britton,
523 U.S. 574 (1998) .............................................. 21
Dep’t of Commerce v. New York,
139 S. Ct. 2551 (2019) ...................................... 1, 23
Hammerschmidt v. United States,
265 U.S. 182 (1924) .............................................. 39
Marsh v. Alabama,
326 U.S. 501 (1946) .............................................. 38
McCormick v. United States,
500 U.S. 257 (1991) ........................................ 20, 29
McDonnell v. United States,
136 S. Ct. 2355 (2016) .................................... 29, 34
McNally v. United States,
483 U.S. 350 (1987) ...................................... passim

 v
TABLE OF AUTHORITIES
(continued)
Page(s)
Neder v. United States,
527 U.S. 1 (1999) .................................................. 44
Nieves v. Bartlett,
139 S. Ct. 1715 (2019) .................................... 21, 22
Pasquantino v. United States,
544 U.S. 349 (2005) ........................................ 41, 43
Proprietors of Charles River Bridge v.
Proprietors of Warren Bridge,
36 U.S. (11 Pet.) 420 (1837) ................................. 38
Rucho v. Common Cause,
139 S. Ct. 2484 (2019) .......................................... 20
Skilling v. United States,
561 U.S. 358 (2010) ...................................... passim
Sorich v. United States,
555 U.S. 1204 (2009) ............................................ 16
Trump v. Hawaii,
138 S. Ct. 2392 (2018) .......................................... 23
United States v. Baldinger,
838 F.2d 176 (6th Cir. 1988) ................................ 41
United States v. Baldridge,
559 F.3d 1126 (10th Cir. 2009) ............................ 46
United States v. Blagojevich.
794 F.3d 729 (7th Cir. 2015) .................... 20, 52, 53
United States v. Boyland,
862 F.3d 279 (2d Cir. 2017) ................................. 46

 vi
TABLE OF AUTHORITIES
(continued)
Page(s)
United States v. Bruchhausen,
977 F.2d 464 (9th Cir. 1992) ................................ 51
United States v. Delano,
55 F.3d 720 (2d Cir. 1995) ................................... 46
United States v. Evans,
844 F.2d 36 (2d Cir. 1988) ................................... 40
United States v. Garrido,
713 F.3d 985 (9th Cir. 2013) ................................ 32
United States v. Genova,
333 F.3d 750 (7th Cir. 2003) .......................... 20, 46
United States v. Margiotta,
688 F.2d 108 (2d Cir. 1982) ................................. 30
United States v. Medlock,
792 F.3d 700 (6th Cir. 2015) ................................ 43
United States v. Mittelstaedt,
31 F.3d 1208 (2d Cir. 1994) ................................. 38
United States v. Ochs,
842 F.2d 515 (1st Cir. 1988) ................................ 33
United States v. Panarella,
277 F.3d 678 (3d Cir. 2002) ................................. 30
United States v. Regan,
713 F. Supp. 629 (S.D.N.Y. 1989) ........................ 41
United States v. Regent Office Supply Co.,
421 F.2d 1174 (2d Cir. 1970) ............................... 51
United States v. Sadler,
750 F.3d 585 (6th Cir. 2014) ................................ 51

 vii
TABLE OF AUTHORITIES
(continued)
Page(s)
United States v. Salvatore,
110 F.3d 1131 (5th Cir. 1997) .............................. 39
United States v. Shellef,
507 F.3d 82 (2d Cir. 2007) ............................. 50, 52
United States v. Takhalov,
827 F.3d 1307 (11th Cir 2016) ....................... 50, 53
United States v. Thompson,
484 F.3d 877 (7th Cir. 2007) .......................... 47, 52
United States v. Tulio,
263 F. App’x 258 (3d Cir. 2008) ........................... 43
United States v. Walters,
997 F.2d 1219 (1993) ...................................... 41, 42
United States v. Weimert,
819 F.3d 351 (7th Cir. 2016) .......................... 49, 50
U.S. Tr. Co. of N.Y. v. New Jersey,
431 U.S. 1 (1977) .................................................... 7
Westchester Cty. Indep. Party v. Astorino,
137 F. Supp. 3d 586 (S.D.N.Y. 2015) ................... 42
STATUTES
18 U.S.C. § 242 .......................................................... 11
18 U.S.C. § 371 .................................................... 39, 40
18 U.S.C. § 666 .................................................. passim
18 U.S.C. § 1014 ........................................................ 40
18 U.S.C. § 1015 ........................................................ 40
18 U.S.C. § 1019 ........................................................ 40

 viii
TABLE OF AUTHORITIES
(continued)
Page(s)
18 U.S.C. § 1341 ............................................ 31, 32, 42
18 U.S.C. § 1343 ................................................ passim
18 U.S.C. § 1346 ........................................................ 30
28 U.S.C. § 1254 .......................................................... 6
42 Stat. 174 (1921) ................................................ 7, 38
N.J. Stat. § 32:1-4 ........................................................ 7
N.Y. Unconsol. Laws § 6404 ....................................... 7
OTHER AUTHORITIES
Colin Campbell,
At 3 A.M., NC Senate GOP Strips
Education Funding from Democrats’
Districts,
NEWS & OBSERVER, May 13, 2017 ....................... 19
Ben Casselman & Patrick McGeehan,
Tax Bill Posing Economic Woe in
N.Y. Region,
N.Y. TIMES, Dec. 4, 2017 ...................................... 19
Sen. Judiciary Comm.,
Atty. Gen. Confirmation Hrg.
(Jan. 15, 2019) ...................................................... 22
Joe Stephens & Carol D. Leonnig,
Solyndra: Politics Infused Obama
Energy Programs,
WASHINGTON POST, Dec. 25, 2011 ....................... 19

 ix
TABLE OF AUTHORITIES
(continued)
Page(s)
Brette Tannenbaum,
Reframing the Right: Using Theories
of Intangible Property to Target
Honest Services Fraud After Skilling,
112 COLUM. L. REV. 359 (2012) ............................ 29
Aubrey Weber & Claire Withycombe,
Gov. Brown May Veto Several Rural
Proposals Friday,
MAIL TRIBUNE, Aug. 6, 2019 ................................ 19

 1
INTRODUCTION
One day before granting certiorari in this case,
this Court set aside the U.S. Commerce Secretary’s
decision to include a citizenship question on the 2020
census, on the ground that his “stated reason” for the
decision “seems to have been contrived.” Dep’t of
Commerce v. New York, 139 S. Ct. 2551, 2575 (2019).
Five Justices held that this “disconnect between the
decision made and the explanation given” failed the
“reasoned explanation requirement of administrative
law.” Id. For their part, the dissenters warned that
opening “a Pandora’s box of pretext-based challenges
to” agency actions would “enable[] partisans to use
the courts to harangue executive officers through
depositions, discovery, delay, and distraction.” Id. at
2583 (Thomas, J., concurring in part and dissenting
in part); see also id. at 2597 (Alito, J., concurring in
part and dissenting in part) (warning against giving
“license for widespread judicial inquiry into the
motivations of Executive Branch officials”).
Under the Third Circuit’s decision in this case,
however, the Commerce Secretary would not merely
have his decision be set aside. He would also be
imprisoned for fraud. Whatever the proper bounds
of judicial review as a matter of administrative law,
that astoundingly expansive theory of criminal fraud
cannot be correct. It would undo, in one fell swoop,
three decades of this Court’s precedents rejecting
attempts to enforce “honest government” through
vague federal criminal statutes. It would transform
the judiciary into a Ministry of Truth for every public
official in the nation. And it would readily enable
partisans not just to harangue and harass political
opponents—but to prosecute and jail them.

 2
Stepping back, this prosecution arose out of the
so-called “Bridgegate” affair, in which senior political
officials at the Port Authority of New York and New
Jersey reallocated two traffic lanes over the George
Washington Bridge in a way that increased traffic in
the town of Fort Lee—while decreasing it elsewhere.
All lanes remained in public use at all times; some
simply shifted from one constituency to another,
reversing a “political deal,” cut decades earlier, that
favored Fort Lee. Pet.App.4a. The prosecution’s core
allegation was that the Port Authority’s deputy
executive director (Bill Baroni) and an aide to New
Jersey’s Governor (Bridget Kelly) ordered the change
to punish Fort Lee’s mayor for not endorsing the
Governor’s reelection. That political motive drove
their actions, prosecutors argued, rather than “the
best interest of the people of New Jersey.” JA.886.
The Third Circuit affirmed the convictions of
those officials under the statutes prohibiting wire
fraud and fraud from federally funded programs.
The court reasoned that they had defrauded the Port
Authority of its property—namely, the lanes, and the
employee labor (including their own) used to plan
and study the realignment. How? By citing a traffic
study as the reason for the realignment, despite their
“true purpose” being political payback. That is to
say, the “fraud” here—and the basis for seven
convictions under two federal criminal statutes—was
the concealment of political motives for an otherwiselegitimate official act. All that separates a routine
decision by a public official from a federal felony, per
the opinion below, is a jury finding that her publicpolicy justification for the decision was not really and
truly her subjective reason for making it.

 3
There is no way that could be the law. Taken
seriously, it would allow any federal, state, or local
official to be indicted on nothing more than the
(ubiquitous) allegation that she lied in claiming to
act in the public interest. Consider a deputy mayor
who orders pothole repair to reward her boss’s
political base, justifying it on policy grounds. Or a
staffer who requests an environmental review as
window-dressing to assuage a lobby group, with no
intention of heeding its recommendations. Or a state
cabinet secretary who appoints a friend to a post,
declaring him to be the best-qualified. All are felons
under the decision below, since they engaged in spin
in describing their “true purposes,” and so “deprived”
the state of “property” (the pothole-repair trucks, the
expense of the study, or the appointee’s salary). This
is, in effect, a souped-up version of the honestservices fraud theory that this Court constrained in
McNally v. United States, 483 U.S. 350, 360 (1987),
and Skilling v. United States, 561 U.S. 358 (2010).
The Third Circuit has now blessed a back-door route
to criminalize all of the same conduct (and more).
Not surprisingly given its absurd practical and
doctrinal consequences, the Third Circuit’s decision
is profoundly wrong. Its core error was to treat the
Port Authority’s regulatory decisionmaking power as
a “property” interest under the fraud statutes. The
state’s “sovereign power to regulate” is not property.
Cleveland v. United States, 531 U.S. 12, 23 (2000).
Altering the alignment of lanes over a public bridge
is therefore not property fraud. Treating sovereign
policy decisions as “property” would put every official
action in the sights of the fraud laws, turning them
into broad government ethics codes.

 4
Nor does it matter that implementation of the
realignment required some public employee labor, or
resulted in some additional expenses for the agency.
Every official decision involves implementation and
cost, even if just the value of employee time. If those
incidental costs of a regulatory decision were enough
to make it property, every order to conduct a study,
review, or assessment the official does not intend to
follow would be a crime (due to the expenses of
conducting it), every nepotistic hiring would be fraud
(due to the appointee’s salary), and indeed Cleveland
itself would have come out the other way (based on
the cost of processing the fraudulent licenses). That
is simply not the law. None of this amounts to the
fraudulent deprivation of property because the goal
of these schemes is not pecuniary. In this case, too,
the officials’ “scheme” was to influence how the Port
Authority exercised regulatory power over lane
alignment, not to deprive it of the employee wages
incidentally implicated by that exercise.
There are other flaws in the decision below, too.
For one, even if the “scheme” here targeted a genuine
property right, it makes no sense to say that officials
acting on behalf of the state defraud the state when
they take exercise their authority for “bad” reasons.
In that situation, the state is not being defrauded of
property; it is being deprived of the good-faith service
of its agent acting within the scope of her authority.
That is not fraud; it is breach of fiduciary duty. Here
there was no dispute that the officials had authority,
at least in the first instance, to decide how to allocate
the traffic lanes. Even if they did so for their own
political reasons, the Port Authority was not thereby
“defrauded” of any property.

 5
Further, public officials’ subjective reasons for
acting are beyond the scope of the fraud statutes. It
is the objective decision that affects and concerns the
state, not the subjective motive for it. That being so,
misrepresenting such motives does not constitute
property fraud—just as, in commercial contexts, lies
about a seller’s reserve price or how a buyer intends
to use a product are treated as too remote from the
elements of the bargain to qualify as fraud, even if
those lies induce a transaction. Analogously, when
an official makes a lawful decision, her “true” reason
for acting cannot ground a fraud prosecution.
In short, the proper rule is that the prohibitions
against fraudulent deprivations of property do not
reach a public official’s exercise of sovereign power—
only schemes whose purpose is to deprive the state of
its property. Regulatory power is not property. Even
if it were, an official’s exercise of her own delegated
power, no matter how improper, does not deceive the
state into parting with it. And lies about her reasons
for exercising such power, especially, are too remote
from the decision itself to constitute property fraud.
*

*

*

The alleged conduct here was petty, insensitive,
and ill-advised. But in our system, political abuses
of power are addressed politically. Prosecutors may
try to supplement political blowback with criminal
sanctions, especially when public anger reaches a
vitriolic peak. But the role of the courts is to ensure
that this anger is channeled consistent with the rule
of law—to ensure fairness for these defendants and,
even more importantly, to preclude mischief going
forward. The rule of law here compels reversal of the
convictions. The Court should order just that.

 6
OPINIONS BELOW
The district court’s opinion refusing to dismiss
the indictment (Pet.App.75a) is at 2016 WL 3388302.
Its opinion denying post-trial relief (Pet.App.105a) is
at 2017 WL 787122. The Third Circuit’s decision
affirming in part, reversing in part, and remanding
(Pet.App.1a) is reported at 909 F.3d 550.
JURISDICTION
The Third Circuit issued its opinion and entered
judgment on November 27, 2018; it denied rehearing
on February 5, 2019. Pet.App.1a, 129a. This Court
granted certiorari on June 28, 2019. Jurisdiction lies
under 28 U.S.C. § 1254(1).
PROVISIONS INVOLVED
The relevant statutory provisions (18 U.S.C.
§§ 666 and 1343) are at Pet.App.131a, 133a.
STATEMENT
As the court below acknowledged, “[t]he facts of
this case are not materially in dispute.” Pet.App.3a
n.1. It involves allegations that senior officials at the
Port Authority reallocated lanes over the George
Washington Bridge in a way that increased traffic in
a nearby town because that town’s mayor refused to
endorse the New Jersey Governor’s reelection. The
Third Circuit held that this conduct defrauded the
Port Authority of property interests in the lanes and
the services of its employees, because the officials
had concealed their “true” political motives under the
“guise” of an insincere public policy rationale
(namely, studying traffic). Pet.App.2a, 7a.

 7
A. The Port Authority and Its Governance
The Port Authority is a bi-state agency, created
under a congressionally approved interstate compact
between New York and New Jersey. See 42 Stat. 174
(1921); N.Y. Unconsol. Laws § 6404; N.J. Stat. § 32:14; U.S. Tr. Co. of N.Y. v. New Jersey, 431 U.S. 1, 4-5
(1977) (background). The Port Authority’s function
is to manage public bridges, tunnels, airports, and
other transportation facilities in the region.
The Port Authority’s senior political leadership is
divided between New York and New Jersey in “two
parallel chains of command.” JA.723. New York’s
Governor appoints half of its Commissioners as well
as its executive director; New Jersey’s Governor
designates the rest of the Commissioners and the
deputy executive director. JA.137, 141-43. The
governors hold ultimate veto power. JA.549.
At the times relevant here, the deputy executive
director was William Baroni, Jr. As the Government
emphasized, his role encompassed management of
“all aspects” of Port Authority business. JA.20-21,
237-38. Holding “the number one position on the
New Jersey side,” he was expected to “watch out for
New Jersey’s interests.” JA.236-38. While the
executive director outranked Baroni and technically
had the power to override his decisions
(Pet.App.18a), the Authority in practice had “two
equal day-to-day operators,” such that Baroni
neither answered nor reported to the agency’s
executive director, Patrick Foye.
JA.549.
As
Baroni’s successor agreed, the executive director
“was not [her] boss,” because the officials “were both
considered to be at the same level, the highest New
Jersey and New York appointees.” JA.518-19.

 8
Given its political leadership, the Port Authority
was, not surprisingly, often used “to bestow political
favors,” including to local officials who were viewed
as “potential endorsers” of the New Jersey Governor.
Pet.App.5a. To help grease political support, “[t]he
Port Authority gave benefits ranging from gifts (e.g.,
steel from the original World Trade Center towers,
flags that had flown over Ground Zero, framed
prints) and tours, to jobs, to large economic
investments (e.g., the $250 million purchase of the
Military Ocean Terminal at Bayonne).” Id.
B. The George Washington Bridge
Among the transportation facilities that the Port
Authority manages is the George Washington Bridge,
“a double-decked suspension bridge” that connects
Fort Lee, New Jersey to New York City. Pet.App.4a.
The upper level of the bridge hosts twelve toll lanes,
which can be accessed in two ways. The first, known
as the “Main Line,” consists of a collection of major
highways, including I-95. The second, known as the
“Local Access Lanes” or “Special Access Lanes,” feeds
from local Fort Lee streets onto the far right side of
the toll plaza. See JA.72-74, 936; Pet.App.4a.
As the result of a “political deal” reached decades
ago “between a former New Jersey governor and Fort
Lee mayor,” the typical practice during “the morning
rush hour” was for traffic cones to “reserve the three
right-most lanes ... for local traffic from Fort Lee.”
Pet.App.4a. The remaining nine lanes were reserved
for the Main Line. Id. Although Fort Lee residents
made up just 5% of total bridge traffic (JA.433-34), a
quarter of the upper-level booths were reserved for
local lanes. As a result, drivers would cut through
Fort Lee just to access the bridge. JA.291-92, 1004.

 9
C. The Lane Realignment
On September 6, 2013, a Port Authority official
named David Wildstein, who “functioned as Baroni’s
chief of staff” (Pet.App.3a), directed civil servants to
change the traffic patterns leading to the upper-level
tollbooths on the George Washington Bridge starting
the following Monday. Pet.App.8a–9a. Instead of
reserving nine lanes and tollbooths for Main Line
traffic and the remaining three for the local approach,
employees were instructed to place the traffic cones
to reserve eleven and one, respectively. Pet.App.9a.
Wildstein told the employees that the purpose of this
change was to study the resulting traffic patterns “so
that New Jersey could determine whether those
three lanes given to Fort Lee would continue on a
permanent basis.” Pet.App.8a.
The civil servants told Wildstein that “because
only one Special Access Lane would remain open, the
Port Authority needed to pay an extra toll collector to
be on relief duty” in case that one remaining collector
needed a break. Pet.App.9a. Over the course of the
realignment, the Port Authority paid $3,696 in these
additional wages to ensure consistent service at the
remaining dedicated local tollbooth. Pet.App.47a.
Wildstein also directed Port Authority engineers
to “collect[] data on the ensuing traffic.” Pet.App.9a.
Three employees did so, “working on the traffic study”
by gathering data, analyzing it, and comparing it to
“historical travel times” under the prior alignment.
Pet.App.24a-25a. Collectively, they spent roughly 38
hours on the project, amounting to approximately
$1,828 in labor costs based on these salaried workers’
effective hourly rates of pay. Pet.App.48a-49a.

 10
To be clear, no toll lanes or booths were closed as
part of the realignment. Rather, two toll lanes were
reallocated from the local approach to the Main Line.
Unsurprisingly, this realignment reduced Main Line
traffic, because those drivers had access to two extra
lanes. On Tuesday, September 10, Wildstein noted
that Main Line rush-hour traffic broke 45 minutes
earlier than usual. JA.367. Preliminary analysis by
Port Authority employees found that, over the week,
the realignment saved “approximately 966 vehicle
hours” for Main Line drivers. JA.977. Of course,
traffic worsened for motorists employing the Local
Access Lanes, as cars “backed up into Fort Lee and
gridlocked the entire town.” Pet.App.9a.
Fort Lee’s mayor tried to contact Port Authority
officials about the issue, but they did not respond.
Pet.App.9a-10a. Nor had the Port Authority given
Fort Lee any “advance warning of the change,” which
would have been typical practice. Pet.App.8a-9a.
The realignment remained in effect for four days,
until Executive Director Foye “sent an email to
Baroni and others, criticizing the ‘hasty and illadvised’ realignment and ordering the restoration of
the prior alignment.” Pet.App.10a. Baroni asked
Foye to reconsider, calling the issue “important to
Trenton,” meaning the Governor’s Office—but Foye
refused. Id. Importantly, however, Foye admitted at
trial that no policy ever required his pre-approval of
the realignment. Pet.App.135a-36a. It was actually
the Government that elicited that testimony, to show
that Baroni had lied to a state legislative committee
by claiming to have proposed such a policy change in
the wake of the scandal. See id.

 11
D. The Indictment and Trial
1. After gaining Wildstein’s cooperation, federal
prosecutors from New Jersey’s U.S. Attorney’s Office
indicted Baroni for wire fraud (18 U.S.C. § 1343),
defrauding a federally funded entity (id. § 666(a)),
and conspiracy to commit the same. Their theory
was that Baroni had fraudulently obtained Port
Authority property by concealing his true motives for
the lane realignment. The Government alleged that
his true purpose was to punish Fort Lee’s mayor,
Mark Sokolich, for refusing to endorse the Governor.
But Baroni instead “falsely represent[ed] ... that the
lane and toll booth reductions were for the purpose of
a traffic study.” Pet.App.12a. While Port Authority
employees did in fact conduct a traffic study, it was
allegedly a “sham,” in the sense that Baroni was not
sincerely interested in its results. Pet.App.56a.1
The Government also indicted Petitioner Bridget
Anne Kelly on the same charges, on the ground that
she had conspired with, and aided and abetted,
Baroni and Wildstein. JA.20-55. Kelly was a
political staffer in the Governor’s Office whose roles
included keeping track of local officials’ political
relationships with the administration, and ensuring
that state agencies were responsive to those local
officials. Pet.App.4a-5a. At the Port Authority,
Wildstein was Kelly’s liaison. Id.
1

Although no longer relevant, the indictment also charged
civil-rights violations under 18 U.S.C. § 242, on the theory that
the realignment had deprived the residents of Fort Lee of their
(supposedly) clearly established constitutional right to engage
in intrastate travel. JA.59-60. The Third Circuit reversed
those convictions (Pet.App.73a), which are no longer at issue.

 12
The district court denied motions by Baroni and
Kelly to dismiss the indictment. Pet.App.75a. On
wire fraud, the court reasoned that it was enough to
allege that the defendants had “prevented the Port
Authority from exercising ‘its right to exclusive use
of’ its property, which here allegedly includes toll
booths and roadways, in addition to money in the
form of employee compensation.” Pet.App.94a. On
§ 666, the court construed the statute to forbid not
only theft, embezzlement, conversion, and fraud, but
also “any improper use of property,” and declared
categorically that it is “improper” to be motivated by
political “retribution.” Pet.App.86a-87a.
Despite acknowledging that this prosecution was
“novel,” the court rejected a vagueness challenge as
“inappropriate for a pretrial motion” and cast aside
the rule of lenity as irrelevant because the statutes
at issue were, in the court’s view, neither “unclear”
nor “ambiguous.” Pet.App.80a-81a & n.3.
2. At trial, Wildstein testified that his purpose
for the realignment was “punishing Mayor Sokolich,”
and that he had developed “a public policy reason” as
a “cover story” so that he did not have to disclose
that “it was political.” Pet.App.7a. More specifically,
when giving direction to civil servants at the Port
Authority, he described the realignment as “a traffic
study” for purposes of evaluating whether the local
lanes “would remain permanent.” Pet.App.7a-8a.
The central fact disputes at trial concerned the
knowledge and role of Baroni and Kelly, particularly
whether they shared Wildstein’s punitive motive.
Kelly and Baroni testified that they believed that the
realignment was a bona fide effort to study the effect
of the change on traffic, which might worsen in the

 13
short-term but then improve after drivers stopped
cutting through Fort Lee to access its quicker lanes.
E.g., JA.730-36.
The Government, by contrast,
elicited testimony from Wildstein that Kelly, after
confirming that Sokolich would not endorse the
Governor, directed him to punish Sokolich by causing
traffic in Fort Lee. Pet.App.12a-13a. Wildstein also
testified that Baroni had approved all relevant parts
of the plan. Pet.App.8a.
After a lengthy trial, the jury convicted Baroni
and Kelly on all counts. Pet.App.13a.
3. The district court denied post-trial relief.
The defendants contended that the “unprecedented
theory of money or propery fraud” advanced by the
Government was an end-run around this Court’s
“limitations ... on the intangible rights and honest
services theories.” R.304 at 35. But the trial court
held otherwise, reasoning that a jury could conclude
that the defendants’ concealment of their motives for
the realignment deprived the Port Authority of “an
intangible property right”—namely, its “control” over
assets “such as toll booths, roadways, [and] employee
compensation.” Pet.App.122a n.15.
On § 666, the court reasoned that the evidence
was sufficient to show intentional misuse of Port
Authority property—again including “compensation
paid to Port Authority personnel” and “the value of
the access lanes and toll booths”—because the
defendants had “concealed the real reason” for the
realignment. Pet.App.117a-19a.
The district court sentenced Baroni to 24 months
in prison and Kelly to 18 months, but allowed both to
remain free pending appeal. Pet.App.13a.

 14
E. The Third Circuit’s Decision
The Third Circuit first affirmed the convictions
for wire fraud, agreeing that the defendants deprived
the Port Authority of its “property.”
First, their “lie” was advancing a “rationale” for
the lane allocation (i.e., studying traffic) that differed
from their “real reason” for making it (i.e., political
retribution against the mayor). Pet.App.23a. This
“untruthful claim” about their subjective motivations
for the decision satisfied the deception element of the
offense. Pet.App.15a. And the defendants needed
that “cover story,” the court reasoned, to convince
agency bureaucrats to cooperate and to stop their
superiors from interceding. Pet.App.17a-18a.
Second, the panel held that this lie deprived the
Port Authority of “intangible property.” Pet.App.22a.
The defendants supposedly “obtained,” through their
fraud, “public employees’ labor”—i.e., the labor of the
extra toll collectors, of the staff who conducted the
traffic study by collecting and analyzing data about
the realignment’s impacts, and even Wildstein’s and
Baroni’s own labor. Pet.App.22a, 24a-25a. In the
court’s view, this work was “unnecessary,” and the
defendants had thus “commandeer[ed]” the employee
time. Pet.App.25a, 28a. The court further held that
the defendants had deprived the Port Authority of its
“right to control” physical assets like the lanes—its
supposed “unquestionable property interest in the
bridge’s exclusive operation.” Pet.App.26a-28a.2
2 While the court claimed sua sponte that the defendants
had “arguably forfeited” in the district court their challenge on
the property element, it proceeded to address the issue on the

 15
The panel upheld the § 666 convictions on the
same basic reasoning. It invoked the § 666(a) prong
forbidding the agent of a federally funded agency to
“obtai[n] by fraud” any property of that agency worth
at least $5,000. Pet.App.35a. For the same reasons
as the defendants had committed wire fraud, the
court held, they had also “fraudulently obtain[ed]”
property: “the labor of Port Authority employees.”
Id. Again, the defendants lied “about the purpose of
the realignment” and, through that lie, “obtain[ed]”
the employees’ labor for otherwise “unnecessary”
work that did not further what the court viewed as
“legitimate” Port Authority objectives. Pet.App.44a.
Again, the court relied on the services of the extra
tollkeepers and the engineers who had “conducted”
the insincere “traffic study.” Pet.App.56a.
In reaching these decisions, the panel claimed to
be “mindful” of this Court’s decisions in McNally and
Skilling, but insisted that those precedents did not
“counsel[] a different result” since “Defendants were
charged with simple money and property fraud,” not
honest-services fraud. Pet.App.30a. Similarly, the
court dismissed any “federalism concerns,” since the
Port Authority “is an interstate agency created by
Congressional consent” and receives federal funds.
Pet.App.32a. The panel also denied that its reading
of the relevant statutes created any “constitutional
vagueness concerns.” Pet.App.45a.
(continued…)
merits. Pet.App.20a-21a. Anyway, there was no forfeiture: The
defendants challenged the Government’s theory of property at
length in their post-trial motion, explaining that the theory was
an improper end-run around Skilling. See R.304 at 35-40.

 16
ARGUMENT
Federal prosecutors have long been tempted to
pursue public officials for perceived malfeasance in
advancing “the public good.” They initially invoked
generic fraud statutes, contending that unfaithful
officials defrauded citizens of a supposed intangible
property right to “honest and impartial government.”
McNally, 483 U.S. at 355. But this Court held that
these laws protect only traditional “property rights,”
and refused to construe them in a way that would
“involv[e] the Federal Government in setting
standards of disclosure and good government for
local and state officials.” Id. at 360. Congress then
enacted an honest-services statute; prosecutors again
began to use its broad, amorphous text to punish any
“unappealing or ethically questionable conduct.”
Sorich v. United States, 555 U.S. 1204, 1206 (2009)
(Scalia, J., dissenting from denial of certiorari). Once
again, this Court intervened, limiting the statute’s
reach to the core targeted misconduct: bribery and
kickbacks. See Skilling, 561 U.S. at 408-10.
This case takes the jurisprudence full-circle. The
officials here did not take bribes or kickbacks, and so
the Government could not charge them with honestservices fraud. It charged them with property fraud.
Of course, the defendants took no money or property
from the agency. The Government’s theory, however,
was that the concealment of their political motives
deprived the Port Authority of “intangible” property:
the right to control how the bridge was run and how
its employees were used. Pet.App.22a, 27a-28a. The
Third Circuit agreed: The defendants were guilty
because they lied about their “real reason” for the
realignment. Pet.App.23a.

 17
Petitioner’s argument proceeds in two parts.
Part I explains why the Third Circuit’s decision must
be wrong. Nothing is easier than accusing a public
official of harboring ulterior political motives for his
decisions. That allegation suffices, per the decision
below, not just to vote against the official, or to set
aside his administrative decision, but also to indict
him for fraud. Imprisonment thus hinges on a jury’s
finding about whether the official’s “policy reason”
for acting was also her “true purpose.” Pet.App.7a.
There is no end to the (bipartisan) mischief that such
a regime would facilitate, or to the chilling effect it
would carry. That is why this Court, in McNally and
Skilling, rebuffed efforts to use criminal fraud laws
to police the ethical duty of public officials to advance
the public interest. The opinion below nullifies those
seminal precedents by allowing all the same conduct
to be reframed as a deprivation of property.
Part II then explains, more doctrinally, why the
Third Circuit’s decision is wrong. There are actually
several reasons. One, Cleveland explained that the
state’s “intangible rights of allocation, exclusion, and
control” do not constitute property for purposes of the
fraud statutes. 531 U.S. at 23. Yet that is all that
the “scheme” here targeted: the Port Authority’s
control over the allocation of lanes on a public bridge.
And the incidental costs of the regulatory action are
irrelevant, as they were not the object of the “scheme
to defraud.” Two, even if there were a property right
here, the Port Authority was not deprived of it when
its own senior officials made decisions about its use.
Three, an official’s lie about her subjective motives for
a decision is categorically not the type of falsehood
that can support a fraud charge.

 18
I.

THE GOVERNMENT’S SWEEPING CONCEPTION OF
“PROPERTY FRAUD” IS DANGEROUSLY WRONG

The crux of the Third Circuit’s reasoning on the
scope of the fraud statutes—is straightforward: the
lane reallocation would have been legal if done for
legitimate purposes, but was converted to criminal
fraud because the officials’ “true,” unstated purpose
was political. Their “real reason” for realigning the
lanes was exacting political revenge, yet they
justified it as serving a neutral policy “rationale”:
studying traffic. By concealing their motives in that
way, the defendants were able to “conscript[]” their
Port Authority subordinates “into their service” to
conduct the realignment, without being overruled by
superiors who might have looked askance at naked
political payback. They thereby defrauded the Port
Authority of that marginal employee labor, plus their
own labor, plus the intangible “right to control” the
allocation of the lanes. Pet.App.23a, 24a, 26a.3
The implications of that theory are astounding—
and grave. It would readily allow the indictment and
prosecution of nearly any public official in the nation.
And it would effectively unwind thirty years of this
Court’s jurisprudence reining in the far-flung honestservices fraud theories that prosecutors have invoked
to enforce their preferred visions of good government.
These consequences, both practical and doctrinal—
and none of which the Third Circuit denied—make it
abundantly clear that the decision below is wrong.
3

Because the Third Circuit affirmed the § 666 convictions
under that statute’s “obtains by fraud” prong (Pet.App.35a), all
of the convictions hinge on the Government’s theory of property
fraud. Accord BIO.11-12 (treating both statutes together).

 19
A. The Government’s Theory Criminalizes
Politics and Chills Public Service
1. As a practical matter, the decision below is
untenable. Under it, any official (federal, state, or
local) who conceals or misrepresents her subjective
motive for an otherwise-lawful decision—including
by purporting to act for public-policy reasons without
admitting to her ulterior political goals, commonly
known as political “spin”—has thereby defrauded the
government of “property” (her own labor if nothing
else). And if she used a phone or email in connection
with that scheme, or if her government takes federal
funds, then she is guilty of federal crimes.
Consider the nearly limitless array of routine
conduct that is criminal under the decision below.
Political motives are everywhere; that is the nature
of democracy. See, e.g., Joe Stephens & Carol D.
Leonnig, Solyndra: Politics Infused Obama Energy
Programs, WASHINGTON POST, Dec. 25, 2011
(describing green-energy program “infused with
politics at every level”); Colin Campbell, At 3 A.M.,
NC Senate GOP Strips Education Funding from
Democrats’ Districts, NEWS & OBSERVER, May 13,
2017 (citing legislation shifting state funds from
Democratic to Republican districts); Ben Casselman
& Patrick McGeehan, Tax Bill Posing Economic Woe
in N.Y. Region, N.Y. TIMES, Dec. 4, 2017 (describing
tax bill as “economic dagger aimed at ... Democraticleaning areas”); Aubrey Weber & Claire Withycombe,
Gov. Brown May Veto Several Rural Proposals
Friday, MAIL TRIBUNE, Aug. 6, 2019 (reporting that
Oregon’s Governor was planning to veto proposals
advanced by rural lawmakers after those legislators
“opposed her cornerstone environmental policy”).

 20
Yet these political motives are regularly spun.
Officials who order “[s]peedy pothole repair for
neighborhoods that support the incumbent,” United
States v. Genova, 333 F.3d 750, 759 (7th Cir. 2003),
do not confess their “real reason” to their superiors
or subordinates. Elected officials who (permissibly)
promote the interests of their donors, see McCormick
v. United States, 500 U.S. 257, 272 (1991), do not
advertise their political ties in doing so. Legislators
who draw districts to favor their own political party,
see Rucho v. Common Cause, 139 S. Ct. 2484, 249495 (2019), do not generally announce that objective.
Rather, these officials justify their acts on neutral,
objective policy grounds. Under the Government’s
theory, all of them have committed fraud. “It would
be more than a little surprising ... if the judiciary
found in the ... mail fraud statute[] a rule making
everyday politics criminal.”
United States v.
Blagojevich. 794 F.3d 729, 735 (7th Cir. 2015). That
is the effect of the Third Circuit’s decision here.
This is not hyperbole. Replace the toll lanes in
this case with any scarce public resource—snowplow
trucks, for example, or building permit inspectors.
An official allocates it: the trucks will focus on one
neighborhood; the inspector will prioritize a project.
The official announces that the decision promotes the
public good: the neighborhood is needy; the project is
good for the local economy. In fact, though, her “real
reason” was less public-spirited: the neighborhood
voted for her boss; the development is owned by a
campaign donor. Per the decision below, the official’s
misstated motive deprived the state of the resource
in question. Every politically motivated allocation of
resources is now “fraud,” unless openly confessed.

 21
2. The problem is actually far worse. All that is
needed to obtain an indictment is a mere allegation
that the official misrepresented something relating
to an official decision, including his political motives.
Making that allegation and then throwing the issue
to a jury—to probe the inner workings of the public
official’s decisionmaking and make an unrefutable
finding of bad faith, with serious criminal penalties
hanging in the balance—could not be easier. “[A]n
official’s state of mind,” after all, is notoriously “‘easy
to allege and hard to disprove.’” Crawford-El v.
Britton, 523 U.S. 574, 584-85 (1998).
The threat of political abuse, and the resulting
deterrent to public service, is palpable and profound.
Indeed, even in civil cases, this Court has expressed
great concern over rules that would penalize officials
based on jury determinations of their true motives.
Just last Term, the Court considered whether an
arrestee may sue for retaliatory arrest claim if there
was objective probable cause for the arrest but the
officer’s real reason was allegedly to retaliate for his
speech or political views. In holding that the answer
is generally no, the Court expounded on the dangers
of tying liability to “purely subjective” facts like
“mental state.” Nieves v. Bartlett, 139 S. Ct. 1715,
1725 (2019). Only an objective test, the Court said,
would “ensure that officers may go about their work
without undue apprehension of being sued.” Id.
Allowing liability based on “a subjective inquiry”
would “pose overwhelming litigation risks” and “thus
‘dampen the ardor of all but the most resolute, or the
most irresponsible, in the unflinching discharge of
their duties.’” Id. (quoting Gregoire v. Biddle, 177
F.2d 579, 581 (2d Cir. 1949) (Learned Hand, J.)).

 22
Likewise, in City of Columbia v. Omni Outdoor
Advertising, Inc., the Court refused to exempt, from
antitrust law’s state-action immunity, governmental
decisions “‘not in the public interest.’” 499 U.S. 365,
376-77 (1991). Such value judgments must be left to
“elected officials,” and tethering “personal liability”
for officials to “ex post facto judicial assessment” of
the public interest would be impractical. Id. at 377.
And a “subjective test” (asking whether the officials
truly believed they were acting in the public interest)
could be “even worse,” because that “would require
the sort of deconstruction of the governmental
process and probing of the official ‘intent’ that we
have consistently sought to avoid.” Id.
Of course, the chilling effect of hinging criminal
liability on an official’s subjective motives is far more
severe—a point that the Attorney General himself
recognized at his confirmation hearing. Discussing
the offense of obstructing justice, he explained: “If
you say that any act that influences a proceeding is a
crime if you have a bad state of mind,” the result
would be to “essentially paralyze the government,”
since influencing proceedings is what public officials
“do every day of the week.” Sen. Judiciary Comm.,
Atty. Gen. Confirmation Hrg. (Jan. 15, 2019). Citing
certain pardons issued by former President Clinton,
he asked whether a prosecutor could allege that they
obstructed justice because they were taken “for a
political reason,” namely “to help Hillary Clinton run
in New York.” Id. The Attorney General’s point was
correct: If routine, otherwise-lawful decisions become
criminal if taken for concealed “political reason[s],”
then every official becomes a target. And that would
indeed “paralyze” the government.

 23
These concerns are not academic. It has become
commonplace to sue public officials, claiming their
actions were motivated by concealed, illicit purposes,
rather than by their stated, legitimate goals. For
instance, in Trump v. Hawaii, the plaintiffs argued
that the President had issued an immigration
proclamation because of “religious animus” and that
his “stated concerns about vetting protocols and
national security were but pretexts.” 138 S. Ct.
2392, 2417 (2018). Plaintiffs challenging rescission
of the DACA program claim there was an “ulterior
motive” for the decision, different from the stated
interest in enforcing the law. Casa De Maryland v.
U.S. Dep’t of Homeland Sec., 284 F. Supp. 3d 758,
774 (D. Md. 2018). And, as referenced above, this
Court agreed that there was a “significant mismatch
between the decision the Secretary made” regarding
the citizenship census question “and the rationale he
provided.” Dep’t of Commerce, 139 S. Ct. at 2575.
Again, whatever the validity of these theories as
a basis for civil relief under the Constitution or the
APA, the Government’s theory here weaponizes them
to another level: They are now grounds for a criminal
fraud indictment. President Trump fraudulently
obtained the labor of thousands of consular officials
by citing national security for his proclamation;
Secretary Duke defrauded Homeland Security of the
money spent on the “unnecessary” task of drafting
and executing the DACA rescission by lying about its
“true purpose”; and Secretary Ross did the same by
hiding his reasons for the citizenship question. None
could have taken these actions without falsely citing
valid policy reasons—or so a jury could surely find.
If this is the law, the nation should brace itself.

 24
3. Opposing certiorari, the Government claimed
that the Third Circuit’s holding can be cabined to
avoid these untenable consequences. Each limiting
principle that it proffered, however, collapses under
scrutiny. There is no principled, coherent limit on
the theory of fraud adopted below.
First, the Government argued that Baroni did
not “possess unilateral authority” to undertake the
realignment and therefore he “had to lie” about his
motives in order to effect the realignment. BIO.1315. Based on this, the Government suggests that the
holding below is limited to public officials who lie to
induce unauthorized actions. That is not a tenable
distinction, either here or as a general matter.
Some unpacking is required. It has always been
undisputed that Baroni had the authority, in the first
instance, over lane allocation. As the Government
told the jury, Baroni was a “high-ranking” official
who “had authority” to “move the cones.” JA.884-86;
see also JA.20 (indictment). Indeed, Baroni was
“number two” at the Port Authority (JA.236), and the
Government elicited testimony that he did not need
the approval of the only more-senior official to
“change ... a lane configuration” (Pet.App.135a-136a).
Of course, had this been outside of Baroni’s purview,
even the “policy reason” he offered would not have
caused the bureaucracy to carry out his orders.
True, Baroni lacked final authority; his decisions
could be overruled by the Port Authority’s executive
director, its governing board, or the Governors. See
Pet.App.18a (“That Baroni was countermanded
shows he lacked ... unencumbered authority ....”).
The Third Circuit accordingly speculated that, had
Baroni told the Port Authority staff that he wanted

 25
to realign the lanes for political revenge, there was a
practical risk they would have gone over his head
and convinced the executive director to override him.
Id. So he “had to create the traffic study cover story”
to avoid being “countermanded.” Pet.App.17a.
With the undisputed facts understood, it is clear
that the Government’s limiting principle is illusory.
No official in our system holds “unencumbered
authority” in the sense that the court below used the
term—i.e., cannot be overridden by some other actor.
Foye himself could have been overruled by the Port
Authority’s Board of Commissioners; the Board by
the two Governors. Even chief executives answer to
legislatures, to courts, and to voters, all of whom
have some power and inclination to obstruct nakedly
political acts. There is nothing unique about Baroni.
All officials must fear intercession if they advertise
their basest political motives. That is why none do.
Accordingly, if Baroni’s “public policy reason” for
the realignment was fraud because honesty risked
inviting reversal, the same holds true for every
hypothetical discussed above: A mayor who is honest
about her snowplow sequence risks causing staff to
object and city council to intervene, and so “need[s]
to lie” (BIO.16) to implement it. A police officer who
confesses to a retaliatory arrest would see his chief
release the arrestee, which is why he cites probable
cause. A cabinet secretary who owns up to a political
basis for adding a census question or rescinding a
program might be stymied by the President or by
Congress (or by a court), so she invokes a neutral
ground. Most crucially, juries could certainly make
these analogous findings and, per the decision below,
that is enough to throw all these officials in jail.

 26
To put the point a different way: Nothing about
the Third Circuit’s logic turns on Baroni’s particular
role in the Port Authority’s hierarchy. Had he been
the executive director, it could equally be said that
he “had to lie” to avoid being overruled by its Board
of Commissioners. Had he been the Chairman of the
Board, he would have “had to lie” to avoid being
overruled by the Governor. Had he been Governor,
he would have “had to lie” to avoid possible censure
by the legislature or impeachment by voters.
In short, any official who conceals his political
motive for an action worries that its disclosure would
jeopardize, as a practical matter, his ability to
execute. The Third Circuit’s reasoning about how
Baroni “needed to lie” can thus be easily replicated in
every context. It does not limit, in the slightest, the
potency of this novel theory of criminal fraud.
Moreover, even if the Government’s (invented)
distinction could be sustained, the result would be
that every public official below chief executive—the
vast majority of officials—could be convicted of fraud
for hiding their political motives. Even if a mayor or
a governor were treated as having “unencumbered
authority” and thus could not be prosecuted for, e.g.,
lying about her reasons for siting a stadium (or a
waste-treatment plant) in a particular location, the
deputy mayor or gubernatorial aide could be. That is
a breathtaking expansion of fraud in its own right,
and it makes little sense for the fraud statutes to
exempt only the most powerful officials.
Second, the Government implied that this case is
unique because the realignment, allegedly unlike the
hypotheticals, caused “unnecessary work that served
no legitimate Port Authority function.” BIO.13-14.

 27
This is a smokescreen. Dividing twelve lanes
into an eleven-one configuration is obviously no less
“legitimate” than aligning them into a nine-three
pattern. Allocating scarce public resources among
public constituencies is what officials do—whether
the resource is pothole repair, police patrols, traffic
lanes, or anything else. The “political deal” that had
originally bestowed three special lanes on Fort Lee
(Pet.App.4a) holds no exclusive, permanent claim to
public legitimacy. One administration is not bound
to a predecessor’s policy (much less political) choices.
The notion that the employee labor needed to
implement the realignment was “unnecessary” or
“no[t] legitimate” thus reduces to the claim that the
defendants had bad reasons to order the realignment
in the first place. If they were sincerely motivated by
studying traffic or making the lane allocation more
fair, then the employee labor was indisputably both
necessary and legitimate to get those jobs done. The
only reason this labor is supposedly converted into
“unnecessary” work is that the decisionmaker’s
subjective motive was political. This confirms that
the Third Circuit’s dispositive factor for property
fraud is the existence of a hidden political motive—
and confirms that all of the hypotheticals, real and
imagined, fall within its scope: The President’s
immigration order caused “unnecessary” work by
consular officials, because he was not truly driven by
national security. The legislator who appropriates
pork causes money to be expended for “no legitimate
purpose,” as he knows there is no need for a bridge to
nowhere. The Commerce Secretary causes dozens of
lawyers to conduct an “unnecessary” defense of his
pretextual citizenship question. And so forth.

 28
Pejorative labels are not limiting principles. And
it is not the role of courts or juries in criminal cases
to decide whether policy decisions are “necessary” or
“legitimate.” Under the decision below, any official
deemed to have hidden her political motives or lied
about acting in the public interest could equally be
accused, by a court or jury, of taking “illegitimate” or
“unnecessary” action. That cannot be right.
Finally, the Government suggested that this case
is unusual since it “involve[d] a deprivation of money
or property.” BIO.16-17. That literally begs the
question presented. It is true that the fraud statutes
cover only deprivations of “property.” As construed
below, however, essentially every decision by a public
official will satisfy that element.
Many official decisions will relate to the use of a
physical asset (like the bridge in this case), touching
the state’s supposed intangible “right to control” it.
Pet.App.26a. If not, the action will take the time of
an employee, whose labors are thus “conscripted.”
Id. Indeed, whenever officials make decisions, civil
servants implement them; there is no decision that
does not demand at least some time or attention from
aides, staff, or bureaucrats. And even if there were
such a rare case, the official’s own attention will be
“diverted” by the scheme. Pet.App.44a. Under the
Third Circuit’s rule, each of those independently
qualifies as “property” under the fraud statutes. And
while § 666 is limited to of property worth at least
$5,000, “the wire fraud statute contains no monetary
threshold.” Pet.App.31a n.12. Accordingly, as the
court below agreed, even a “peppercorn” is enough to
convict. Id.

 29
Between these three “property interests,” not a
single governmental decision is beyond the reach of a
criminal fraud indictment. Any deception relating to
that decision, even regarding the official’s subjective
motive for it, then becomes fodder for prosecution.
*

*

*

This Court has rejected statutory constructions
that would “cast a pall of potential prosecution” over
“nearly anything a public official does.” McDonnell
v. United States, 136 S. Ct. 2355, 2372 (2016); accord
McCormick, 500 U.S. at 272 (rejecting interpretation
that would “open to prosecution ... conduct that in a
very real sense is unavoidable”). The theory of fraud
defended by the Government here would do just that.
Trying to enforce the Platonic public good through
federal criminal law, it would authorize prosecutors
to pursue, and empower juries to convict, any official
whose spin is deemed too aggressive or whose actions
insincerely public-spirited. That cannot be right.
B. The Government’s Theory End-Runs the
Honest-Services Doctrine
The other dead give-away that the Third Circuit
erred is the effect its opinion would have on this
Court’s seminal decisions. In McNally and Skilling,
the Court rejected the unbounded “honest-services
fraud” theory prosecutors were using to criminalize
dishonest politics. The opinion below negates those
rulings, effectively adopting an academic proposal to
circumvent them by “refram[ing]” the same conduct
“as deprivations of property.” Brette Tannenbaum,
Reframing the Right: Using Theories of Intangible
Property to Target Honest Services Fraud After
Skilling, 112 COLUM. L. REV. 359, 363-64 (2012).

 30
1. In McNally, this Court refused to read the
mail fraud statute to protect the “right to have public
officials perform their duties honestly.” 483 U.S. at
358. The law “clearly protects property rights,” the
Court held, “but does not refer to the intangible right
of the citizenry to good government.” Id. at 356. So,
“[r]ather than construe the statute in a manner that
leaves its outer boundaries ambiguous and involves
the Federal Government in setting standards of
disclosure and good government for local and state
officials, [the Court] read § 1341 as limited in scope
to the protection of property rights.” Id. at 360.
Following McNally, Congress enacted a statute
providing that “scheme or artifice to defraud” under
the mail- and wire-fraud statutes includes the vague,
undefined “scheme or artifice to deprive another of
the intangible right of honest services.” 18 U.S.C.
§ 1346. Prosecutors again used that law to charge
and punish all sorts of unsavory political conduct
that did not involve the deprivation of traditional
property rights. E.g., United States v. Panarella, 277
F.3d 678, 680 (3d Cir. 2002) (failure to disclose
conflict of interest); United States v. Margiotta, 688
F.2d 108 (2d Cir. 1982) (patronage by party official).
In Skilling, this Court put an end to that abuse—
or so it thought. To avoid “the due process concerns
underlying the vagueness doctrine,” the majority
limited the honest-services statute to bribery and
kickbacks, excluding the “amorphous” broader set of
political corruption cases that the Government had
prosecuted under that rubric. 561 U.S. at 408-10.
Three Justices would have gone further and stricken
§ 1346 in its entirety as unconstitutionally vague.
See id. at 415 (Scalia, J., concurring in part).

 31
2. Nobody in this case took bribes or kickbacks
(or otherwise benefited financially). As a result, the
Government did not charge honest-services fraud—
at least not expressly, though it argued to the jury
that Baroni and Kelly violated their “responsibility
to the public” by failing to act “in the best interest of
the people of New Jersey.” JA.885-86. Formally,
though, the Government instead charged money-orproperty fraud. But its conception of property fraud,
adopted below, is so enormously expansive that it
would, at once, revive the honest-services theory that
McNally rejected—and then extend it to cover even
the extreme cases that Skilling threw overboard.
To start, the Third Circuit’s approach would
make the honest-services statute totally superfluous.
Consider a bribe: An official accepts cash in exchange
for steering a contract, for instance, or approving an
oil pipeline. Under the decision below, there is no
need to charge honest-services fraud, because he has
committed regular property fraud. By failing to
disclose his corrupt motive for acting, or by creating
a cover story to conceal the bribe, the official has lied
and thereby deprived the state of its “property”—the
value of the contract or control over the land under
which the pipeline is built (plus the value of his own
time). After all, had the official disclosed the fact
that he was taking these actions because of an illicit
bribe, surely his superior or another official would
have stepped in to overrule him. This is exactly the
reasoning adopted below. Yet to allow this conduct
to be charged as ordinary property fraud makes a
mockery of McNally, which held that property fraud
under §§ 1341 and 1343 does not include bribery—a
distinct type of political misconduct.

 32
McNally itself would have come out the other
way under the decision below. The official there
steered state insurance contracts to certain agents in
exchange for kickbacks, while hiding his self-dealing.
483 U.S. at 352-53. On the theory adopted below,
there was concealment (of the kickbacks), “property”
(the contracts and the money paid thereunder, plus
the official’s salary), and a causal link between them
(since other officials could have stepped in had they
known about the self-dealing). Yet, it was in fact the
dissent that would have upheld the convictions on a
theory like this one. See id. at 377 n.10 (Stevens, J.,
dissenting) (“When a person is being paid a salary for
his loyal services, any breach of that loyalty would
appear to carry with it some loss of money to the
employer—who is not getting what he paid for.”).
Even worse, the Third Circuit’s approach would
revive, as pecuniary fraud, the prosecutions that this
Court in Skilling rejected: those that involve “action
by the employee that furthers his own undisclosed
financial interests while purporting to act in the
interests of those to whom he owes a fiduciary duty.”
561 U.S. at 409. For example, in United States v.
Garrido, a city treasurer recommended that the city
council enter a series of contracts, without disclosing
his personal and financial interests in the bidders he
recommended. 713 F.3d 985, 989-91 (9th Cir. 2013).
The court vacated the honest-services convictions in
light of Skilling. Id. at 998. But, under the decision
below, this was property fraud: The treasurer hid his
conflict of interest, thereby inducing the city to enter
contracts that cost the city money. If this is right, we
have simply imported all the vagaries of pre-Skilling
honest-services fraud into §§ 1341 and 1343.

 33
Indeed, replace “financial” with “political” in the
above quote from Skilling and it perfectly describes
the allegations here, as the Third Circuit articulated
them: “action by the employee that furthers his own
undisclosed [political] interests while purporting to
act in the interests of those to whom he owes a
fiduciary duty.” 561 U.S. at 409. Incredibly, it thus
revives, under the “property” provisions, a theory of
honest-services fraud even the United States rejected
in a companion case to Skilling: “that purely political
interests may have influenced a public official’s
performance of his duty.” Br. for the U.S. at 45,
Weyhrauch v. United States, No. 08-1196 (U.S. Oct.
29, 2009), 2009 WL 3495337. That is literally this
case. Under the decision below, politically motivated
conduct is property fraud, because “purporting to
act” for a neutral policy reason while subjectively
intending to further a political purpose defrauds the
state of its intangible property interests (and its
incidental costs) ancillary to the official’s actions.
In short, the decision below conflicts with this
Court’s precedents on a fundamental level: If the
opinion below is correct, then a host of seminal cases
constraining application of federal criminal statutes
to political behavior were both wrongly decided and
utterly pointless. Federal prosecutors have all the
discretion that McNally and Skilling held they did
not. Again, that simply cannot be correct. Accord
United States v. Ochs, 842 F.2d 515, 527 (1st Cir.
1988) (“[W]e do not think courts are free simply to
recharacterize every breach of fiduciary duty as a
financial harm, and thereby to let in through the
back door the very prosecution theory that the
Supreme Court tossed out the front.”).

 34
C. The Government’s Theory Is Anathema
to Every Canon of Construction
The account of property fraud embraced below
not only negates the outcomes of this Court’s critical
precedents, but also flies in the face of the principles
that the Court has established to construe the vague
federal statutes at issue here.
First, the Court should avoid the “constitutional
concerns” that would arise from an interpretation
that “cast[s] a pall of potential prosecution” over
“nearly anything a public official does.” McDonnell,
136 S. Ct. at 2372. As discussed, the opinion below
yields exactly that consequence. See supra at 19-23.
It is the rare public decision that cannot be attacked
as driven by hidden political self-interest. And with
ambitious prosecutors seeking out public attention,
the threat of criminalizing large swaths of routine
politics—and the concomitant threat of selective,
abusive enforcement—are very real.
Second, the Government’s theory also imperils
principles of federalism. This Court has refused to
read the federal fraud statutes to “involve[] the
Federal Government in setting standards of … good
government for local and state officials.” McNally,
483 U.S. at 360. Congress must “speak more clearly”
to justify such a result. Id.; see also Cleveland, 531
U.S. at 25 (“‘[U]nless Congress conveys its purpose
clearly, it will not be deemed to have significantly
changed the federal-state balance’ in the prosecution
of crimes.”). Due to the ubiquity of communication
by wire (for § 1343) and the fact that virtually all
state and local governments receive federal funds
(for § 666), the Government’s property theory would
carry just the result that McNally foreswore.

 35
Nonetheless, the Third Circuit declared that this
case “lacks the federalism concerns present in
McNally” since “the Port Authority is an interstate
agency.” Pet.App.32a. No. An interstate agency is
an agency of the states, not the federal government.
More fundamentally, the fraud statutes mean the
same thing in cases against state and local officials
that they mean in cases against officials of interstate
agencies, just as they mean the same thing on
Tuesdays as they do on Thursdays.
Finally, this Court has interpreted the fraud
statutes in light of the “doctrine of lenity” and in a
way that gives citizens “fair notice of what sort of
conduct may give rise to punishment.” McNally, 483
U.S. at 375. The Third Circuit brushed aside these
concerns by trumpeting that the conduct here had
“inconvenienced thousands.” Pet.App.45a. Even if
so, the court’s holdings apply to all cases—serious
and petty alike. Prosecutors are free to pursue the
cases they choose, for reasons they choose. The
decision below thus permits prosecution of routine
political conduct. That too contravenes this Court’s
principles of statutory construction.
II. REALIGNING THE LANES DID NOT DEPRIVE THE
PORT AUTHORITY OF PROPERTY, REGARDLESS
OF THE DEFENDANTS’ SUBJECTIVE MOTIVES
For the reasons above, the Third Circuit must be
wrong. For the reasons below, it is wrong. There are
actually three independent features of this case that
take it outside the doctrinal boundaries of the fraud
statutes. Ignoring these features, as the lower court
did, invites to one extent or another the practical and
precedential absurdities spelled out above.

 36
First, at its most fundamental level, the scheme
here did not take aim at the Port Authority’s
“property rights.” McNally, 483 U.S. at 358. It
aimed, rather, to alter the allocation of lanes over the
George Washington Bridge—i.e., to influence a
regulatory decision of the agency. This Court held in
Cleveland that sovereign power is not “property”
under the fraud statutes, whether it is characterized
as an “intangible right to control” or otherwise; that
principle controls this case. It does not matter that
this regulatory act caused some incidental expenses,
as that was not, by any account, the scheme’s object.
Clarifying Cleveland’s scope will ensure that
property-fraud prosecutions are not used to police—
or chill—discretionary policy choices.
Second, even where property is truly at issue, an
official who is empowered to make decisions about
that property on behalf of the state does not defraud
the state by doing so, even if he violates his fiduciary
duties in the process. Of course, if he puts property
to an objectively improper use, he may be guilty of
theft, embezzlement, or misapplication—but fraud is
an inapposite concept for a decisionmaker.
Third, the Court should hold that an official’s
representations about his subjective reasons for an
action do not trigger liability as a matter of law. Not
all lies can support a fraud charge. Some concern
matters that are too remote from the terms of the
transactions they induced. Applying that principle
in the public sphere, what counts is what the official
does—not why. Lies about the latter do not cause a
deprivation of property. Excising “motive” lies from
fraud’s domain would go a long way toward reining
in the criminalization of politics portended below.

 37
A. Depriving a State of Regulatory Control
Is Not Property Fraud
In Cleveland, this Court held that a scheme to
deprive the state of regulatory power is not property
fraud. That is all that happened here. To distract
from that, the Third Circuit emphasized the costs of
the regulatory decision in terms of compensation
paid to Port Authority employees. Every regulatory
act incurs some costs like those, however. So long as
the object of the scheme is not to deprive the victim
of property, it does not amount to property fraud.
1. Cleveland involved video poker licenses that
the State of Louisiana issued. The defendants lied
about their ownership interests in the entity that
sought the license, allegedly because they had “tax
and financial problems that could have undermined
their suitability” for licensure. 531 U.S. at 15-17.
This Court reversed the mail-fraud convictions,
because a state license is not state “property.” Id. at
15. The Government argued that the scheme had
deprived the State of its “right to control” licensing
decisions. Id. at 23. But the Court declared that the
“intangible rights of allocation, exclusion, and control
amount to no more and no less than [the State’s]
power to regulate.” Id. Licensing “implicate[s] the
Government’s role as sovereign, not as property
holder.” Id. at 24. So, even though the state licenses
were “tied to an expected stream of revenue,” viz.,
licensing fees, “the State’s right of control does not
create a property interest any more than a law
licensing liquor sales in a State that levies a sales
tax on liquor.” Id. at 23. Instead, “[s]uch regulations
are paradigmatic exercises of the State’s traditional
police powers.” Id.

 38
Cleveland directly controls this case. Just as the
sovereign right to control who obtains a license is not
a property interest, neither is the right to control
who drives on public roads. The Port Authority is,
after all, a “body ... politic,” with powers “conferred
upon it by the legislature[s]” of two states. 42 Stat.
174, 176. And establishing “toll bridges” reflects “an
exercise of sovereign power.” Proprietors of Charles
River Bridge v. Proprietors of Warren Bridge, 36 U.S.
(11 Pet.) 420, 468 (1837). Indeed, the “operation” of
“bridges” is a classic “public function.” Marsh v.
Alabama, 326 U.S. 501, 506 (1946). So, to the extent
that the defendants interfered in Port Authority
decisions, they were regulatory decisions, made in
the agency’s “role as sovereign.” Cleveland, 531 U.S.
at 24. Influencing those decisions through deception
is therefore not property fraud.
It makes no difference that the lanes are physical
property, because how to allocate that property is a
regulatory question. The “deprivation” here, after
all, was not of the lanes themselves, which the Port
Authority retained. Rather, the “deprivation” was, if
anything, of the right to decide how to allocate those
lanes. And that is precisely akin to the licensing
determination in Cleveland. That decision would not
have come out differently, to put the point another
way, had the lie concerned a permit to operate an
event in a public park instead of a license to operate
poker machines. In both cases, the governmental
interest is regulatory, not proprietary. Accord United
States v. Mittelstaedt, 31 F.3d 1208, 1217 (2d Cir.
1994) (recognizing that “loss of the ‘right to control’
the expenditure of public funds” cannot ground a
federal fraud charge). The same is true here.

 39
Although Petitioner relied on Cleveland below,
the Court of Appeals ignored it. The Third Circuit’s
opinion instead echoes the Fifth Circuit decision that
Cleveland had reversed, recognizing the “right to
control” the bridge as a property interest of the Port
Authority, and holding that the agency holds “an
unquestionable property interest in the bridge’s
exclusive operation, including the allocation of traffic
through its lanes.”
Pet.App.27a-28a.
Compare
United States v. Salvatore, 110 F.3d 1131, 1140 (5th
Cir. 1997) (citing “Louisiana’s right to choose the
persons to whom it issues video poker licenses”).
That is patently wrong: As Cleveland explained,
“the[ ] intangible rights of allocation, exclusion, and
control amount to no more and no less than [the
State’s] sovereign power to regulate.” 531 U.S. at 23.
Cleveland’s interpretation of the mail and wire
fraud statutes is corroborated by comparing them to
statutes that extend beyond property rights. In
Hammerschmidt v. United States, this Court
considered 18 U.S.C. § 371’s prohibition of conspiring
“to defraud the United States ... in any manner or for
any purpose.” 265 U.S. 182, 185 (1924). The Court
read that statute as reaching schemes “to interfere
with or obstruct ... lawful governmental functions by
deceit.” Id. at 188. But that “broad construction ... is
based on a consideration not applicable to the mail
fraud statute”: “Section 371 is a statute aimed at
protecting the Federal Government alone; however,
the mail fraud statute ... had its origin in the desire
to protect individual property rights, and any benefit
which the Government derives from the statute must
be limited to the Government’s interests as property
holder.” McNally, 483 U.S. at 358 n.8.

 40
Indeed, if the Third Circuit were correct, § 371
would be largely superfluous. So would be a host of
other federal statutes that criminalize particular lies
to the government. See, e.g., 18 U.S.C. § 1014 (lies
for purpose of influencing actions of a set of federal
agencies); id. § 1015 (lies relating to naturalization
and citizenship); id. § 1019 (lies by consular officers).
Those lies would inherently deprive the government
of at least the labors of the affected public employees
(the immigration judge, for example, who considers
and evaluates the false citizenship papers). If all of
that already amounted to mail or wire fraud, why did
Congress enact these other statutes?
2. In opposing certiorari, the Government did
not defend the Third Circuit’s holding about the Port
Authority’s “right to control” the lanes. BIO.21.
Instead, the Government argued that the court had
correctly identified employee wages—for the extra
toll collector, and the three engineers who conducted
the traffic study—as the property interest that the
Port Authority had lost as a result of the defendants’
conduct. BIO.12. While the defendants’ decision to
realign the lanes did not itself deprive the Port
Authority of property, the argument goes, the labor
that was used to implement that decision constitutes
a cognizable property interest.
Cleveland cannot be so easily circumvented. If
deceiving a state entity into a regulatory decision is
not fraud, then using public resources to implement
that decision cannot be fraud either. The latter is
simply “ancillary to a regulation.” United States v.
Evans, 844 F.2d 36, 42 (2d Cir. 1988). After all, the
employees are doing as told, and the state is getting
exactly what it paid for. In this case, the tollkeepers

 41
took tolls and the engineers produced traffic reports.
The fact that their work was “unnecessary,” in the
sense that they were effectuating an official decision
touched by deceit (Pet.App.43a), does not mean that
anyone was “defrauded” of their services or salaries.
Indeed, state employees in Cleveland were
equally diverted toward processing and printing the
falsified license applications; that was not enough for
this Court to conclude that the applicants defrauded
the state of the employees’ time (or the value of the
paper on which the licenses were printed). If using
public employees or public resources to effectuate a
regulatory decision were enough to trigger the fraud
statutes, then Cleveland would be a dead letter—as
no regulatory action is implemented without them.
Whether it is paving roads, enforcing laws, or waging
war, policy choices have costs. That cannot suffice to
transform sovereign decisions into “property.”
More fundamentally, an incidental loss does not
turn deceit into fraud. As this Court has said, fraud
requires “the object of the [scheme]” to “be money or
property in the victim’s hands.” Pasquantino v.
United States, 544 U.S. 349, 355 (2005) (emphasis
added). “The money or property deprivation must be
a goal of the plot, not just an inadvertent consequence
of it.” United States v. Regan, 713 F. Supp. 629, 637
(S.D.N.Y. 1989) (emphases added); see also United
States v. Baldinger, 838 F.2d 176, 179 (6th Cir. 1988)
(requiring “a direct intention to deprive another of a
recognized and traditional property right”). Thus, as
Judge Easterbook has explained: “Losses that occur
as byproducts of a deceitful scheme do not satisfy the
statutory requirement.” United States v. Walters,
997 F.2d 1219, 1227 (1993).

 42
Consider Judge Easterbrook’s hypothetical: “A
mails B an invitation to a surprise party for their
mutual friend C. B drives his car to the place named
in the invitation. But there is no party; the address
is a vacant lot; B is the butt of a joke. The invitation
came by post; the cost of gasoline means that B is out
of pocket.” Id. at 1224. Churlish? Yes. Fraud? No.
To treat “practical jokes” as “federal felonies would
make a joke” of this Court’s “assurance that § 1341
does not cover the waterfront of deceit.” Id. The
statutes cover “schemes to get money or property by
fraud,” not those that “incidentally cause losses.” Id.
at 1225.
The “scheme” here was not fraud for the same
reason as the joke in Walters: Its object was not to
deprive anyone of property. The object was to alter
the traffic patterns on the bridge, ultimately to exact
political revenge on a partisan foe. Even though the
tollkeepers were paid overtime—causing a financial
cost to the Port Authority—that was not the object of
the scheme. Actually, it was a step suggested by the
agency civil servants, to ensure that traffic over the
local lanes did not become even worse. Pet.App.9a.
That secondary, incidental, downstream loss does not
transform a scheme to deprive the Port Authority of
its regulatory power into property fraud. Simply put,
depriving or obtaining property was, by all accounts,
never the object of the “scheme.” At most, it occurred
as a (foreseen) byproduct of their regulatory
machinations. That is not enough. See Westchester
Cty. Indep. Party v. Astorino, 137 F. Supp. 3d 586,
603, 607 (S.D.N.Y. 2015) (scheme to rig an election
was not fraud because “object of the scheme” was
“control over the Independence Party,” not property).

 43
None of this is to say that governments cannot be
victims of property fraud. A plot to deprive the state
of taxes due is fraud, for example. Pasquantino, 544
U.S. at 355. So too a plot to deceive Medicare (or any
other entitlement program) into paying benefits or
reimbursements that are not legally due. See United
States v. Medlock, 792 F.3d 700, 704 (6th Cir. 2015).
And the fraud statutes proscribe lying to the state
when it is “purchasing goods and services in the open
market,” i.e., acting as a market participant. United
States v. Tulio, 263 F. App’x 258, 262 (3d Cir. 2008);
see also Cleveland, 531 U.S. at 24 (recognizing that
government sometimes acts as property holder, in
which event it is protected by the fraud statutes).
These schemes are fraud, unlike Judge Easterbrook’s
practical joke and the conduct here, because their
aim (and not merely their incidental byproduct) is to
deprive the government of its property.
*

*

*

Nearly twenty years ago, this Court squarely held
that the state’s “sovereign power to regulate” is not
property. Cleveland, 531 U.S. at 23. A deceitful
scheme to affect regulatory action—whether taken
by an official or a citizen—is thus not property fraud.
And prosecutors cannot render Cleveland nugatory
simply by pointing to some incidental monetary loss
caused by the scheme, as those costs would exist in
any case. Instead, the fraud statutes require the
object of the fraud to be property loss. Here, there is
no allegation (much less proof) that the defendants
sought to deprive the Port Authority of any property,
only of its regulatory power. Their convictions must
accordingly be reversed.

 44
B. An Official Does Not Defraud the State
by Misusing Property He Controls
Even if a genuine property interest were at
stake, the Port Authority was not defrauded of it.
Fraud requires a material falsehood that induces the
victim to part with its property. Thus, in Cleveland,
the Government’s theory of fraud was at least
superficially plausible because the applicants had
lied to state officials to induce them to provide
licenses—the supposed “property” at issue. Here, by
contrast, the lie was by the Port Authority officials
who controlled operation of the bridge. In realigning
its lanes, they did not induce the Port Authority to
act on false pretenses. They simply exercised their
own authority to act on the agency’s behalf. If they
did so for a bad reason, and even if they lied about
that reason, they at worst violated a fiduciary duty
to their employer—but they did not defraud it, as the
deception was not used to take property, intangible
or otherwise, that belonged to the agency.
1. As this Court has explained, fraud requires
the use of some “material” deception to induce the
victim to part with property. Neder v. United States,
527 U.S. 1, 22-25 (1999) (citing Restatement (Second)
of Torts § 538 (1977)). A deception can be “material”
only if it provides some “inducement or motive” for
the victim to act. Id. at 22 (quoting 1 J. Story,
Commentaries on Equity Jurisprudence § 195 (10th
ed. 1870)). In a case of property fraud, the lie is thus
the mechanism that the perpetrator uses to obtain
property that is not otherwise within his control. To
defraud the state, accordingly, the perpetrator must
deceive the relevant government decisionmaker into
acting based on false pretenses.

 45
By the same token, an official does not commit
fraud simply by misusing property that the state has
already entrusted to him—i.e., when he himself is
the relevant decisionmaker. Since the official is in
control of the property, he has authority to act for the
state in deciding how it will be used. If he orders the
property to be misused, he does not deceive the state;
he simply abuses his authority. And it makes no
difference if he provides some false policy reason for
his action. What matters is that he has authority to
act on the state’s behalf, and thus the lie cannot be
the mechanism that induces the state to act.
To adjust Cleveland ’s facts, imagine if Louisiana
officials handed out poker licenses to their friends
and falsely claimed they were suitable candidates.
That hypothetical falls even further beyond the scope
of the fraud statutes than Cleveland itself, because
the state officials were not defrauding Louisiana out
of the licenses they were authorized to issue, even if
they issued them improperly.
Another hypothetical: Baroni exercises his power
to redirect a Port Authority financial grant from Fort
Lee to a city with a more politically friendly mayor.
The Port Authority was not defrauded of that grant
money. Rather, the agency acted through its agent,
whose job was to make decisions on its behalf. He
perhaps made the decision for a bad reason; perhaps
he even lied about it. But fraud is more than breach
of fiduciary duty. To be sure, Baroni may (in this
hypothetical) have “abused the power” entrusted to
him. JA.886. But an employee’s “faithful service” is
“an interest too ethereal in itself to fall within the
protection of the mail fraud statute.” Carpenter v.
United States, 484 U.S. 19, 25 (1987).

 46
Of course, this does not mean a public official can
never commit property fraud. To do so, however, he
must use deception as a means to induce the state to
part with its property. Guilty, for example, is the
official who “file[s] false claims with the County for
payment,” thus diverting public funds to pay for
work that was not done. United States v. Baldridge,
559 F.3d 1126, 1129-31 (10th Cir. 2009). So too the
state legislator who claims entitlement to “per diems
and travel reimbursements for assembly district
business trips that he did not take.” United States v.
Boyland, 862 F.3d 279, 286 (2d Cir. 2017). In those
cases, the public official has no authority to secure
the funds from the state without the lies.
A public official may also commit other crimes by
misappropriating property over which he exercises
control. For example, it is unlawful to “embezzle[],”
“convert[],” or “misappl[y]” state property. 18 U.S.C.
§ 666(a). Under those offenses, an official cannot
steal or misuse public property by diverting it to
private use. E.g., United States v. Delano, 55 F.3d
720, 723 (2d Cir. 1995) (parks commissioner used
city staff to perform “work on private homes”). But
those crimes involve putting property to objectively
improper uses; they do not cover officials who merely
act with a subjective political motive in allocating
public resources among facially legitimate uses: “A
bureaucrat who tells sanitation and snow removal
employees to ensure that the mayor’s neighborhood
is cleaned up early and often” commits no crime, but
one who uses city funds to pay workers for campaign
work does cross the line, because “political activities
are not the performance of a garbage collector’s
official duties.” Genova, 333 F.3d at 758-59.

 47
2. The officials here did not use deception as a
means to induce the Port Authority to part with its
property. They therefore did not commit fraud.
The allocation of traffic lanes between the Main
Line and the Local Access was, by its very nature, a
discretionary policy decision. And it was a decision
that, by the Government’s account, was Baroni’s to
make in the first instance. See JA.20, 236, 884-86;
Pet.App.135a-136a. Nobody has ever alleged that he
violated any objective restriction in ordering the
realignment. Nor has the Government ever disputed
that he could lawfully have taken the same action for
sincere policy reasons. Thus, Baroni did not deceive
the agency into realigning the lanes, but simply
acted on behalf of the agency in ordering it be done.
Accordingly, because he had authority to realign the
lanes at his discretion, he did not defraud the Port
Authority out of any property interest.4
4

Nor did he thereby commit “misapplication” or any of the
other offenses discussed above. Again, realigning the lanes as
between the Main Line and the Local Access was not objectively
illegitimate or improper in any way, as all lanes were open for
public use at all times—just different segments of the public, by
virtue of political favoritism. That political motive obviously
does not turn an objectively proper use of public property into a
federal crime. Indeed, “[t]he idea that it is a federal crime for
any official in state or local government to take account of
political considerations when deciding how to [allocate public
resources] is preposterous.” United States v. Thompson, 484
F.3d 877, 883 (7th Cir. 2007) (Easterbrook, J.). Thus, although
the Government charged the defendants with both fraud and
misapplication under § 666(a), the Court of Appeals did not rely
on the latter in upholding the convictions, and the Government
conceded in its opposition to certiorari that the convictions are
premised on a “scheme to defraud.” BIO.22.

 48
The Third Circuit accepted this legal principle at
some level, but reasoned that Baroni did not exercise
“unilateral authority” over the lanes because he was
subject to being “countermanded” by the Authority’s
executive director. Pet.App.18a; see also supra at 2425. From this, the lower court concluded that the lie
about the true motive for the realignment was the
mechanism for the deprivation of property: Had the
officials’ true purpose been publicized, civil servants
could have asked the executive director to intervene
and reverse the decision (as he eventually did, even
before learning the “real reason” for the action). The
falsehood thus helped reduce (or delay) the practical
risk of reversal by a superior. Pet.App.18a.
That attenuated speculation, even if credited, is
not enough to make Baroni guilty of property fraud.
After all, the subordinates who received the lie were
not the relevant decisionmakers; Baroni did not need
to give them any justification for his orders. And it
remains the case that he did not need any superior’s
sign-off to realign lanes. Rather, absent a contrary
directive, he had his own discretionary authority to
impose this change—indeed, that was the predicate
for the Government’s complaint that Baroni “abused”
his “power” to “move the cones.” JA.884-86. If he did
not have that power, he could not have abused it.
The Port Authority was therefore not tricked into the
realignment. At worst, the Port Authority’s senior
official breached his fiduciary duty by making this
decision other than in the agency’s best interests,
and lulled his subordinates into going along without
objection. That is not property fraud. If it were, the
same logic could be used to challenge any political
decision by any official. See supra at 24-26.

 49
C. An Official Does Not Commit Fraud by
Lying about His Subjective Motives
Even if Baroni’s lie could somehow be said to
have induced the Port Authority to act, the Court
should hold that this did not amount to property
fraud because of the type of lie. The fraud statutes
do not cover every lie, or even every lie that induces
action. In the commercial context, courts recognize
that only lies about the terms of the exchange—not
about the internal thought process of the parties—
can render the transaction fraudulent. If a seller lies
about his reserve price or a buyer lies about his
ability to pay, there has been no property fraud
because each side ultimately got exactly what they
expected—even if honesty would have altered the
course (or even the end result) of the negotiations.
Translated into the public context, an official’s
deception as to his internal subjective motives for
taking an otherwise-lawful action are beyond the
scope of the fraud statutes. Even if the official’s lies
induced the state action, and even if that action cost
the state money, the state got what it paid for; there
was no fraud about the underlying transaction, only
misdirection about the official’s subjective reasons for
engaging in it. Such misdirection about an official’s
personal reasons for a lawful use of public property is
simply too attenuated from any deprivation of state
property to qualify as criminal fraud.
1. Even where a lie is material, in the sense
that it “is capable of influencing another party’s
decisions,” courts have ruled that certain categories
of falsities “should not be considered material for
purposes of [the] mail and wire fraud statutes.”
United States v. Weimert, 819 F.3d 351, 357-58 (7th

 50
Cir. 2016). The line is between falsehoods that
merely induce “victims to enter into transactions
they would otherwise avoid” (which do not violate
fraud statutes), versus lies that concern the
transaction’s essential terms (which do). United
States v. Shellef, 507 F.3d 82, 108 (2d Cir. 2007).
Misrepresentations only constitute fraud if they
deprive a party of the benefit of its bargain.
One classic example—discussed in Weimert—is
“deception about negotiating positions,” e.g., “reserve
prices.” 819 F.3d at 358. A car dealer lies about the
lowest price he will accept; the customer lies about
the most he will pay. These statements do affect the
negotiations; had each party been completely honest,
the result might have been different. Yet neither
party is guilty of fraud. Id. at 357-58. The reason is
that, in the end, the customer got the car he expected
and the seller got the price he agreed to. There was
no deception about the terms of the exchange—only
about “opinions, preferences, priorities, and bottom
lines,” which are “not considered statements of fact
material to the transaction.” Id. at 358 (citing
Restatement (Second) of Torts § 538A cmts. b, g).
The Eleventh Circuit used another hypothetical
for the point: If a woman asks a “rich businessman to
buy her a drink” at a bar, there is no fraud even if
the woman fails to disclose that the bar owner “paid
her to recruit customers.” United States v. Takhalov,
827 F.3d 1307, 1313 (11th Cir 2016) (Thapar, J.).
Absent those false pretenses, the man may not have
bought the drink, but he still “got exactly what he
bargained for”; the deceit did not “go[] to the value of
the bargain” and so he lost no property. Id.

 51
Still another example: If a salesman falsely
claims to have been referred by a putative customer’s
friend, that is not fraud, since the lie is “not directed
to the quality, adequacy or price of goods to be sold,
or otherwise to the nature of the bargain.” United
States v. Regent Office Supply Co., 421 F.2d 1174,
1179 (2d Cir. 1970). It goes only to the background
motives for entering the transaction, and that is too
remote to constitute a deprivation of property.
Finally, a buyer’s misrepresentations about how
he intends to use a product are not property fraud.
The Ninth Circuit rejected fraud charges based on
false assurances that the defendants would not send
the purchased goods to the Soviet bloc. United States
v. Bruchhausen, 977 F.2d 464, 467-68 (9th Cir. 1992).
And the Sixth Circuit vacated fraud charges where a
defendant lied to drug distributors about how her
pain clinic would use pills she was ordering. United
States v. Sadler, 750 F.3d 585 (6th Cir. 2014)
(Sutton, J.). While the lies convinced the sellers to
make the sales, they were not deprived of property
because they received full price. They were deprived
only of “the ethereal right to accurate information,”
which the fraud laws do not protect. Id. at 590-91.
This limiting principle can be framed as a
restriction on the types of “schemes” that violate the
fraud statutes, or alternatively as cabining what it
means to be “deprived” of property. Either way, the
point is this: Even misrepresentations that induce
action are beyond the scope of the fraud statutes if
they concern matters—like one’s motive, opinion, or
preference—that are too attenuated from the
essential terms of the transaction itself.

 52
2. By analogy to these private-sector principles,
misrepresentations about a public official’s subjective
motives—especially political motives—for otherwiselawful official acts are not the types of deception that
constitute criminal fraud, as a matter of law.
Just as a commercial transaction is not rendered
fraudulent by a misrepresentation that is remote
from the basic terms of the bargain (such as why the
buyer wanted the product, or the importance to the
seller of a quick sale), a public official’s decision is
not rendered fraudulent if he only misrepresents why
he subjectively decided to take the action. So long as
the official action is otherwise lawful and its nature
is not misrepresented, the official’s subjective motive
is not an “essential element of the bargain,” Shellef,
507 F.3d at 108, however that is conceptualized in
the public sphere. What properly concerns the state
is what its officials do, not why they do it.
Thus, a governor does not commit fraud when he
“appoints someone to a public commission and
proclaims the appointee ‘the best person for the job,’
while the real reason is that some state legislator
had asked for a friend’s appointment.” Blagojevich,
794 F.3d at 736. Similarly, a governor who “throws
support (and public funding) behind coal-fired power
plants because people fear nuclear power” has
committed no crime, even if he “privately thinks that
nuclear power would be superior.” Thompson, 484
F.3d at 883. Money was spent—to pay the appointee
or to build the power plant—and, had the governor
been honest, the decision might have been different.
But misrepresentations about his opinions, beliefs,
and motives cannot be treated as depriving the state
of property, because the state “got exactly what [it]

 53
bargained for.” Takhalov, 827 F.3d at 1313. It was
deprived, if anything, only of its official’s honest and
faithful services—which is not “property.” McNally,
483 U.S. at 355; see also Carpenter, 484 U.S. at 25.
Again, to hold otherwise would be to impose “an
extreme version of truth in politics, in which a
politician commits a felony unless the ostensible
reason for an official act also is the real one.”
Blagojevich, 794 F.3d at 736. And that would subject
public officials to unending second-guessing and
hand their political enemies the jailhouse key.
Here, the alleged “lie” concerned only why the
defendants sought to alter the lane alignment: Was
it really to study the ensuing traffic, or was that just
a cover story for their true goal of political revenge?
Ultimately, the Port Authority got what it bargained
for—tollkeepers who collected tolls, engineers who
studied traffic, and a lane alignment that favored
Main Line drivers over those from Fort Lee. Perhaps
the justification that the defendants offered for that
decision was contrived—like the car dealer’s claim
that he will not sell the sedan for a penny less, or the
pill-mill owner’s promise to dispense drugs only to
those with prescriptions. But while the defendants’
scheme may well have been deceitful and ill-advised,
it was not property fraud.
CONCLUSION
This Court should reverse the judgment below.

 54

SEPTEMBER 17, 2019
MICHAEL D. CRITCHLEY
CRITCHLEY, KINUM
& DENOIA, LLC
75 Livingston Avenue
Roseland, NJ 07068

YAAKOV M. ROTH
Counsel of Record
MICHAEL A. CARVIN
ANTHONY J. DICK
ANDREW J. M. BENTZ
JONES DAY
51 Louisiana Ave., NW
Washington, DC 20001
(202) 879-3939
yroth@jonesday.com

Counsel for Petitioner