Thompson v. U.S.:  Statute prohibiting “false” statements in connection with loans does not criminalize “misleading” statements

By Greg Mermelstein, Deputy Director & General Counsel, Missouri Public Defender

           The federal statute which prohibits making false statements to the FDIC in connection with a loan does not criminalize “misleading” statements which are not false, the U.S. Supreme Court held March 21 in Thompson v. United States.

           Patrick Thompson took out three bank loans totaling $219,000.

           The FDIC took over the bank when it later failed.  The FDIC notified Thompson he owed $219,000 plus interest.

           Thompson, however, called the FDIC’s loan servicer and told them, “I borrowed … I think it was $110,000.”

           Subsequently, he was charged with violating 18 U.S.C. Sec. 1014, which prohibits knowingly making “any false statement” to the FDIC in connection with a loan.

           The indictment charged that he told the FDIC he borrowed $110,000, when he knew he had borrowed $219,000.

           The jury found Thompson guilty.

           He moved for judgment of acquittal or a new trial, arguing that conviction for false statements cannot be sustained where the alleged statements are literally true, even though misleading.

           The District Court denied the motion.  The Seventh Circuit affirmed.

Holding

           The Supreme Court reversed, in a unanimous opinion by Chief Justice Roberts.

           The statute’s text “does not use the word ‘misleading’”, the Court said.  “Yet false and misleading are two different things.”

           “A misleading statement can be true.  And a true statement is obviously not false”, the Court said.

 “If a doctor tells a patient, ‘I’ve done a hundred of these surgeries,’ when 99 of those patients died, the statement – even if true – would be misleading because it might lead people to think those surgeries were successful”, the Court said.

           “Given that some misleading statements are also true, it is significant that the statute uses only the word ‘false’”, the Court said.  “If that word means anything, it means ‘not true’”.

           “Just as a matter of plain text, then, a statement that is misleading but true is by definition not a ‘false statement’”.

           “Adding ‘any’ before ‘false statement’ does not change that result”, the Court said.

           “Certainly, ‘any’ has an ‘expansive meaning’”, the Court said.  But expansive is not “transformative.”

           “A statute that applies to ‘any Ford owner’ does not cover all car owners because the car must still be a Ford”, the Court said.  “So too a statute that applies to ‘any false statement’ does not cover all misleading statements because the statement must still be false.”

           The Court rejected the Government’s argument that the dictionary definition of “false” also includes “deceitful.”

           The statute’s prohibition on false statements could reach “some” deceitful statements, the Court said, “but only because those statements are also false.”

           “[T]he only relevant question according to the text of the statute is whether the statement is ‘false’”, the Court said.

           But the context of a statement also matters in answering this question, the Court said.

           “We agree with the parties that at least some context is relevant to determining whether a statement is false”, the Court said.  “Thompson concedes, for example, that if he ‘had made this statement in response to a question like ‘did you borrow [$219,000]?’, then ‘his statement, in context, would have been false.’”

The Court remanded the case for the lower courts to determine, in the first instance, whether a reasonable jury could find that Thompson’s statements were “false” in the context in which they were made.

Concurrences address what happens next

Justices Alito and Jackson wrote separate concurring opinions to express their views on what should happen on remand.

The question on remand is “narrow”, Justice Alito wrote in his concurrence.

Alito noted that Thompson did not object to the jury instructions in the case.  Instead, Thompson bases his request for reversal on insufficient evidence, not instructional error.

“Thus, the applicable test on remand is whether, viewing the evidence in the light most favorable to the Government, any rational finder of fact could conclude beyond a reasonable doubt that [Thompson’s] statements were false in context”, Alito said.

           Justice Jackson, in her concurrence, believed the jury had already determined the statements were false.

           The jury was “properly instructed that it could find Thompson guilty only if the prosecution proved beyond a reasonable doubt that Thompson ‘made the charged false statement[s]’”, Jackson said.

           “Thus, in my view, there is little for the Seventh Circuit to do on remand but affirm the District Court’s judgment upholding the jury’s guilty verdict,” Jackson said.  “Whether Thompson’s statements were, in fact, false is a question for the jury – and here, one the jury has already answered.”

           “At most, then, the Seventh Circuit can properly assess whether any reasonable jury could have found that Thompson’s statements satisfied Sec. 1014’s falsity element”, Jackson said.  “On this record, I think that legal issue is not subject to reasonable debate.”