## Facts

- USDA Rural Development grants funded two colocated agricultural-processing ventures: a milk-processing facility associated with Robert Wells (with an informal profit-sharing partnership with Karen Olson) and an ice-cream/cheese facility operated by Kyle Beus.
- Grant materials warned that misuse of grant funds and false statements connected to the grants could constitute felonies.
- Beus misused substantial portions of his grant funds for personal and unrelated expenses and submitted false information in required project reports.
- Olson, a former executive director of the USDA Farm Service Agency, became aware of Beus’s misuse through the shared facility arrangement and later learned of additional significant misuse.
- Olson documented concerns in notes and communications indicating she believed Beus’s conduct was illegal and serious.
- Olson assisted with preparing and submitting documents and reports about Beus’s project that included information she knew was false, and she did not report Beus’s suspected federal crime to authorities.
- A jury convicted Olson of misprision of felony under 18 U.S.C. § 4 based on concealment and failure to notify authorities of Beus’s felony-level conduct.

## Issues

1. Under 18 U.S.C. § 4, must the government prove the defendant knew the concealed conduct was a felony, not merely wrongful or illegal?
2. If such felony-level knowledge is required, was the evidence sufficient for a rational jury to find Olson had that knowledge?

## Decision

- The Ninth Circuit held that § 4 requires proof that the defendant knew the principal committed a felony and knew the conduct was a felony.
- Applying that standard, the court found sufficient evidence for a rational jury to infer Olson knew Beus’s conduct was felony-level.
- The court affirmed Olson’s conviction.

## Legal Principles

- For misprision of felony under 18 U.S.C. § 4, the government must prove: (1) knowledge of the actual commission of a federal felony, (2) concealment, and (3) failure to notify authorities as soon as possible.
- The statute’s knowledge requirement extends to the “felony” character of the underlying offense; it is not enough that the defendant knew the conduct was improper or unlawful.
- A jury may infer knowledge that conduct is felony-level from circumstantial evidence, including explicit written felony warnings in governing documents, the defendant’s experience and role, contemporaneous notes reflecting awareness of criminal exposure, and active participation in concealment (such as submitting reports known to be false).

## Conclusion

The Ninth Circuit clarified that misprision of felony requires proof the defendant knew the concealed conduct was a felony, then affirmed Olson’s conviction because the record permitted a rational inference that she understood Beus’s grant fraud and false reporting carried felony consequences and nonetheless concealed it and failed to report it.


United States v. Olson, 856 F.3d 1216 (9th Cir. 2017)