## Facts

- ClearOne Communications, Inc. manufactured video‑conferencing equipment and changed its revenue‑recognition method to recognize revenue when product shipped to distributors rather than when sold to end users.
- To meet revenue projections, ClearOne engaged in end‑of‑quarter “channel stuffing,” shipping excess product to distributors and using side arrangements affecting payment or returns.
- Susie Strohm, a former ClearOne executive (including service as CFO or as Controller and Vice President), was primarily responsible for preparing ClearOne’s financial statements and was later suspended.
- In 2003, the Securities and Exchange Commission (SEC) filed a civil enforcement action alleging accounting irregularities and securities‑law violations and sought a preliminary injunction.
- At the preliminary‑injunction hearing, Strohm testified under oath about a particular large, end‑of‑year transaction that the SEC treated as representative of ClearOne’s accounting practices.
- When asked whether she was “involved” in that sale, Strohm denied involvement. When asked to approximate when she first learned of the sale, she testified she did not know whether it was before or after ClearOne’s fiscal year‑end.
- Evidence introduced at Strohm’s later criminal trial showed the transaction was finalized one day before the end of the fiscal year and that Strohm participated in the deal, including increasing the product price after realizing ClearOne would otherwise miss revenue targets.
- The government charged Strohm with one count of perjury under 18 U.S.C. § 1621 based on her SEC‑hearing testimony. A jury convicted her in federal district court, and she appealed.

## Issues

1. Were the SEC‑hearing questions (including whether Strohm was “involved” in the sale) so fundamentally ambiguous that they could not support a perjury conviction as a matter of law?
2. Was the evidence sufficient to permit a reasonable jury to find Strohm’s answers were knowingly false rather than literally true but misleading?
3. Were Strohm’s statements material to the district court’s decision on the SEC’s request for a preliminary injunction?

## Decision

- The Tenth Circuit affirmed Strohm’s conviction (and affirmed the judgment in full).
- The court held the questions, read in context, were not fundamentally ambiguous; any arguable ambiguity was for the jury to evaluate.
- The court held sufficient evidence supported the jury’s finding that Strohm knowingly made false statements about her involvement in the transaction and about when she learned of it.
- The court held the statements were material because they related to a transaction the SEC claimed demonstrated ClearOne’s accounting irregularities and could affect the injunction determination.

## Legal Principles

- A perjury conviction under 18 U.S.C. § 1621 is barred on ambiguity grounds only when a question is fundamentally (fatally) ambiguous; lesser ambiguity does not prevent prosecution and is generally resolved by the jury using the full context of the examination.
- The “literal truth” doctrine prevents perjury liability for answers that are literally true even if evasive, but it does not protect statements a jury can reasonably find false under the ordinary meaning of the question and surrounding context.
- Materiality under § 1621 is satisfied if the statement has a natural tendency to influence, or is capable of influencing, the decisionmaker; the government need not prove actual reliance.
- On sufficiency review, an appellate court asks whether a rational juror could find falsity, knowledge, and materiality beyond a reasonable doubt based on the trial record and reasonable inferences.

## Conclusion

The Tenth Circuit affirmed Susie Strohm’s perjury conviction arising from her sworn testimony at an SEC preliminary‑injunction hearing, concluding that the questions about her involvement in and knowledge of an end‑of‑year transaction were not fundamentally ambiguous, the record supported findings that her answers were knowingly false (not protected as literally true), and the statements were material because they could influence the court’s evaluation of the SEC’s request for injunctive relief based on alleged accounting irregularities.


United States v. Strohm, 671 F.3d 1173 (2011)