## Facts

- Michael Licciardi and his father operated a grape-brokerage business that bought grapes from growers and sold them to Delicato Vineyards.
- The government alleged Licciardi agreed with certain growers to misrepresent the variety and appellation of origin of grapes to obtain higher prices (including passing inferior grapes off as higher-priced Zinfandel).
- The indictment charged a single conspiracy count under 18 U.S.C. § 371 with two theories: (a) conspiring to “defraud” the United States by obstructing BATF’s regulatory functions reliant on accurate wine-records, and (b) conspiring to commit federal offenses including mail fraud.
- Licciardi was also charged with multiple mail-fraud counts under 18 U.S.C. § 1341 based on mailings allegedly used to execute the fraudulent grape-sales scheme.
- A separate conviction was entered for making a false statement under 18 U.S.C. § 1001 in a matter within federal jurisdiction.
- The jury convicted Licciardi of § 371 conspiracy, two counts of mail fraud, and a § 1001 false statement; the court of appeals later vacated the sentence and remanded for resentencing.

## Issues

1. Whether the § 371 conspiracy conviction could rest on a “defraud the United States” theory based on downstream impairment of BATF’s regulatory functions when the immediate deception targeted a private winery.
2. Whether sufficient evidence supported the mail-fraud convictions for misrepresentations about grape variety and origin and the use of the mails to execute the scheme.
3. Whether the § 1001 false-statement conviction should be upheld.
4. Whether sentencing errors required remand for resentencing.

## Decision

- The Ninth Circuit affirmed the § 371 conspiracy conviction, but rejected an expansive version of the government’s “defraud clause” theory.
- The court upheld the conspiracy conviction on the alternative ground that the same conspiracy count alleged (and the evidence supported) an “offense clause” conspiracy to commit federal crimes, including mail fraud.
- The court affirmed the mail-fraud convictions, finding sufficient evidence of a fraudulent scheme and mailings in furtherance of it.
- The court affirmed the § 1001 false-statement conviction.
- The court remanded for resentencing.

## Legal Principles

- Under 18 U.S.C. § 371, a conspiracy conviction may be sustained under the “offense clause” (conspiracy to commit an offense against the United States) even if a separate “defraud clause” rationale is overstated.
- The § 371 “defraud clause” reaches conspiracies that obstruct a lawful federal function through dishonest means, but courts may limit attempts to treat ordinary commercial fraud as a federal “defraud” conspiracy merely because federal regulators rely on accurate records affected by the fraud.
- Mail fraud under 18 U.S.C. § 1341 requires proof of a scheme to defraud and a mailing for the purpose of executing the scheme; commercial misrepresentations about goods sold can satisfy the scheme element when used to obtain higher prices.
- A § 1001 conviction requires a materially false statement made knowingly and willfully in a matter within federal jurisdiction.
- Appellate affirmance of convictions may be accompanied by remand when sentencing determinations require correction.

## Conclusion

The Ninth Circuit upheld Licciardi’s convictions for conspiracy, mail fraud, and a false statement, narrowed the government’s reliance on § 371’s “defraud the United States” theory, and remanded the case to the district court for resentencing.


United States v. Licciardi, 30 F.3d 1127 (9th Cir. 1994)