AND · 18usc1341:materiality
Judge-made incorporation of common-law fraud, not an express word in this statute. Petlechkov supplies the Sixth Circuit's ordinary-prudence formulation, not a uniform national definition. Kousisis leaves unresolved the parties' competing formulations of the materiality standard; it does not adopt an essence-of-the-bargain test as an additional universal element.
Exact element source
false or fraudulent pretenses, representations, or promisesSource:
docroot/ir/usc/title18.jsonl#title18_sec1341; Unicode character offsets [156:215] (end exclusive); SHA-256 74b1f92847676f0dece4359c6b22244b8e760d8e46a597847855747fcd542511.Routes and case patterns
| Route | Definition | Merits instance blocks | Distinct merits cases | Examples (up to 3 cases per count group) |
|---|---|---|---|---|
| Unclassified route provisional; 5 observed cases | no definition yet | 0 Satisfied 0; not satisfied 0; excluded context 5 | 0 | Used only in non-merits blocks (5). Excluded context examples:Southern Snow Manufacturing Co. v. SnoWizard Holdings, Inc. — 912 F. Supp. 2d 404 (2012) · United States District Court for the Eastern District of Louisiana · 2012 — not reached · basis not recorded (18usc1341: author: Fable · not independently reviewed) · background/merits · not counted United States v. Granberry — 725 F. Supp. 446 (1989) · United States District Court for the Eastern District of Missouri · 1989 — not reached · basis not recorded (18usc1341: author: Fable · not independently reviewed) · applied/merits · not counted United States v. Chung Lo — 231 F.3d 471 (2000) · United States Court of Appeals for the Ninth Circuit · 2000 — not reached · basis not recorded (18usc1341: author: Fable · not independently reviewed) · applied/merits · not counted |
| _procedural accepted; provisional (1 case) | The element is only the occasion for a procedural ruling. | 0 Satisfied 0; not satisfied 0; excluded context 1 | 0 | Used only in non-merits blocks (1). Excluded context examples:Neder v. United States — 527 U.S. 1 (1999) · Supreme Court of the United States · 1999 — not reached · basis not recorded (18usc1341: author: Fable · not independently reviewed) · rule-announced/merits · not counted |
| half-truth provisional; provisional (1 case) | Whether a literally true statement that omits qualifying facts is a material misrepresentation. | 2 Satisfied 2; not satisfied 0; excluded context 0 | 1 | Lustiger v. United States — 386 F.2d 132 (1967) · United States Court of Appeals for the Ninth Circuit · 1967 — satisfied · proved (18usc1341: author: Fable · not independently reviewed) · applied/merits · counted Lustiger v. United States — 386 F.2d 132 (1967) · United States Court of Appeals for the Ninth Circuit · 1967 — satisfied · proved (18usc1341: author: Fable · not independently reviewed) · applied/merits · counted |
| reasonable-person-standard provisional; provisional (1 case) | Whether the misrepresentation would matter to a person of ordinary prudence, and whether the victim's own care is relevant. | 1 Satisfied 1; not satisfied 0; excluded context 0 | 1 | U.S. v. Petlechkov — 922 F.3d 762 (2019) · United States Court of Appeals for the Sixth Circuit · 2019 — satisfied · proved (18usc1341: author: Flash3 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) · applied/merits · counted |
How courts decided this element
| Case | Element | Holding and scope | Pattern | Exact source quotations |
|---|---|---|---|---|
| Southern Snow Manufacturing Co. v. SnoWizard Holdings, Inc. — 912 F. Supp. 2d 404 (2012) · United States District Court for the Eastern District of Louisiana · 2012 — not reached (18usc1341: author: Fable · not independently reviewed) | Material deception | not_reached Excluded from merits counts background / merits | Unspecified route | No source quotation recorded for this block. |
| United States v. Granberry — 725 F. Supp. 446 (1989) · United States District Court for the Eastern District of Missouri · 1989 — not reached (18usc1341: author: Fable · not independently reviewed) | Material deception | not_reached Excluded from merits counts applied / merits | Unspecified route | No source quotation recorded for this block. |
| Lustiger v. United States — 386 F.2d 132 (1967) · United States Court of Appeals for the Ninth Circuit · 1967 — satisfied · proved (18usc1341: author: Fable · not independently reviewed) | Material deception | satisfied Counted merits instance applied / merits basis: proved; count: representations about access, utilities and land ownership; subject: count=representations about access, utilities and land ownership Same route for the other categories of statements. The mixed utilities sentence is tagged cuts-against for its disclosed half (the Fact Sheet did say utilities were not presently available); its second half supports. Because there were no special findings the court assumes the trial judge found for the Government on every charged statement and holds that a sufficient number proved misleading is enough. | literally-true-advertising-omitting-qualifying-facts | The brochure stated that all Lake Mead City properties “are within the franchised area of Citizen’s Utilities Company, with regard to power and telephone.” This statement is literally true.Source: docroot/ir/caselaw/f2d_386.jsonl#/f2d/386/0132-01; Unicode character offsets [12458:12647] (end exclusive); SHA-256 984d9591aa1d590044854cc6ba2d3627f236458be86a3fceb9b89b65a6836448.Although the “Fact Sheet” stated that utilities were not presently available, Lustiger failed to disclose that the nearest existing electric power lines and telephone lines are approximately twenty-one miles from the nearest, and thirty-eight miles from the farthest of the Lake Mead City subdivision units.Source: docroot/ir/caselaw/f2d_386.jsonl#/f2d/386/0132-01; Unicode character offsets [12801:13108] (end exclusive); SHA-256 984d9591aa1d590044854cc6ba2d3627f236458be86a3fceb9b89b65a6836448.Customers were not informed that the company owned only the odd-numbered sections, the even-numbered sections belonging to the federal government for grazing, mining and recreational purposes.Source: docroot/ir/caselaw/f2d_386.jsonl#/f2d/386/0132-01; Unicode character offsets [14949:15141] (end exclusive); SHA-256 984d9591aa1d590044854cc6ba2d3627f236458be86a3fceb9b89b65a6836448.Finally, customers were not told that large washes, rocky hills, and steep cliffs separated many of the subdivision parcels, making reasonable travel between them in the future highly unlikely.Source: docroot/ir/caselaw/f2d_386.jsonl#/f2d/386/0132-01; Unicode character offsets [15367:15560] (end exclusive); SHA-256 984d9591aa1d590044854cc6ba2d3627f236458be86a3fceb9b89b65a6836448.The evidence is overwhelming that Lustiger’s advertising materials were in some respects false and, apart from falsity were, when considered as a whole, fraudulently deceptive and misleading, exhibiting an intent and purpose to defraud.Source: docroot/ir/caselaw/f2d_386.jsonl#/f2d/386/0132-01; Unicode character offsets [15692:15928] (end exclusive); SHA-256 984d9591aa1d590044854cc6ba2d3627f236458be86a3fceb9b89b65a6836448. |
| Lustiger v. United States — 386 F.2d 132 (1967) · United States Court of Appeals for the Ninth Circuit · 1967 — satisfied · proved (18usc1341: author: Fable · not independently reviewed) | Material deception | satisfied Counted merits instance applied / merits basis: proved; count: representations about water (recreational and domestic); subject: count=representations about water (recreational and domestic) The block records the deception limb (false or fraudulent pretences): literally true statements plus photographs and maps that mislead as a whole. Materiality in the strict sense was not contested for the water representations ("nor does he question the materiality of the facts presented"); what the court decided is that they were proved misleading. Measured against a person of average intelligence and experience, with a footnote that the naive are protected too. Pre-Neder; materiality is treated as part of the scheme, not a separate element. | literally-true-advertising-omitting-qualifying-facts | Another picture shows a large metal water tank lying horizontally alongside a windmill, with the printed declaration: “IMPORTANT! Plenty of Water.”Source: docroot/ir/caselaw/f2d_386.jsonl#/f2d/386/0132-01; Unicode character offsets [8837:8984] (end exclusive); SHA-256 984d9591aa1d590044854cc6ba2d3627f236458be86a3fceb9b89b65a6836448.It is true that, measured by a straight line, Lake Mead is only five miles from the boundary of Lake Mead City.Source: docroot/ir/caselaw/f2d_386.jsonl#/f2d/386/0132-01; Unicode character offsets [9892:10003] (end exclusive); SHA-256 984d9591aa1d590044854cc6ba2d3627f236458be86a3fceb9b89b65a6836448.However, Lustiger did not reveal that by existing roads Lake Mead is fifteen miles from the nearest and forty miles from the farthest Lake Mead City unit.Source: docroot/ir/caselaw/f2d_386.jsonl#/f2d/386/0132-01; Unicode character offsets [10004:10158] (end exclusive); SHA-256 984d9591aa1d590044854cc6ba2d3627f236458be86a3fceb9b89b65a6836448.Undisclosed to the prospective purchaser, however, was the fact that none of the pictured bodies of water were on land owned or optioned by Lustiger’s company.Source: docroot/ir/caselaw/f2d_386.jsonl#/f2d/386/0132-01; Unicode character offsets [10475:10634] (end exclusive); SHA-256 984d9591aa1d590044854cc6ba2d3627f236458be86a3fceb9b89b65a6836448.Lustiger failed to disclose that the only source of water on the property owned by the company and available to purchasers during the period charged in the indictment was the Clearwater Well, located in the far northwest corner of the Lake Mead City units, a distance of twenty-eight miles from some subdivision units.Source: docroot/ir/caselaw/f2d_386.jsonl#/f2d/386/0132-01; Unicode character offsets [11177:11495] (end exclusive); SHA-256 984d9591aa1d590044854cc6ba2d3627f236458be86a3fceb9b89b65a6836448.Moreover, deceitful statements of half truths or the concealment of material facts is actual fraud violative of the mail fraud statute.Source: docroot/ir/caselaw/f2d_386.jsonl#/f2d/386/0132-01; Unicode character offsets [16309:16444] (end exclusive); SHA-256 984d9591aa1d590044854cc6ba2d3627f236458be86a3fceb9b89b65a6836448.Our examination of Lustiger’s advertising materials reveals that the statements, photographs and maps, unaccompanied by true statements concerning the lack of available water, could reasonably have led a person of average intelligence and experience to believe that all parcels offered for sale had reasonable access to a water supply.Source: docroot/ir/caselaw/f2d_386.jsonl#/f2d/386/0132-01; Unicode character offsets [9405:9740] (end exclusive); SHA-256 984d9591aa1d590044854cc6ba2d3627f236458be86a3fceb9b89b65a6836448.While the statements in the advertising materials may not have been literally false, taken as a whole they were fraudulently misleading and deceptive.Source: docroot/ir/caselaw/f2d_386.jsonl#/f2d/386/0132-01; Unicode character offsets [9741:9891] (end exclusive); SHA-256 984d9591aa1d590044854cc6ba2d3627f236458be86a3fceb9b89b65a6836448. |
| United States v. Chung Lo — 231 F.3d 471 (2000) · United States Court of Appeals for the Ninth Circuit · 2000 — not reached (18usc1341: author: Fable · not independently reviewed) | Material deception | not_reached Excluded from merits counts applied / merits | Unspecified route | No source quotation recorded for this block. |
| United States v. Henry — 29 F.3d 112 (1994) · United States Court of Appeals for the Third Circuit · 1994 — not reached (18usc1341: author: Fable · historical QA: FIX (QA2, neov2/qa/wave2-cases-QA2.md) · changed after review; current content not independently reviewed) | Material deception | not_reached Excluded from merits counts background / merits | Unspecified route | No source quotation recorded for this block. |
| United States v. Boone — 628 F.3d 927 (2010) · United States Court of Appeals for the Seventh Circuit · 2010 — not reached (18usc1341: author: Fable · not independently reviewed) | Material deception | not_reached Excluded from merits counts applied / merits claim: with 18 U.S.C. 1346 (honest services) | Unspecified route | No source quotation recorded for this block. |
| U.S. v. Petlechkov — 922 F.3d 762 (2019) · United States Court of Appeals for the Sixth Circuit · 2019 — satisfied · proved (18usc1341: author: Flash3 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | Material deception | satisfied Counted merits instance applied / merits basis: proved; party: Dimitar Petlechkov; count: all 20 mail fraud counts (one FedEx package each); subject: party=Dimitar Petlechkov; count=all 20 mail fraud counts (one FedEx package each) Sufficiency upheld. A prudent FedEx employee would follow the company's own vendor-discount policy, so the lie could influence the decision; that it actually worked is strong evidence of materiality. The argument that a prudent person would not grant a discount violating Sarbanes-Oxley failed on the testimony. | false claim to be a vendor of a high-volume shipper, made by phone to the carrier's account manager to obtain the customer's discount | His misrepresentation was simple: he called FedEx's account manager for General Dynamics-one of FedEx's larger clients-and claimed he was a General Dynamics vendor entitled to its discounted shipping rate.Source: docroot/ir/caselaw/f3d_922.jsonl#/f3d/922/0762-01; Unicode character offsets [2239:2444] (end exclusive); SHA-256 e8ef7181fd7c4c0d1625b6886392822112d781901a03a369c30766e369d8be7e.And indeed, FedEx's standard "operating procedure" was to extend a customer's discounts to its vendors.Source: docroot/ir/caselaw/f3d_922.jsonl#/f3d/922/0762-01; Unicode character offsets [3416:3519] (end exclusive); SHA-256 e8ef7181fd7c4c0d1625b6886392822112d781901a03a369c30766e369d8be7e.And indeed, it actually influenced FedEx's decision-FedEx gave him a discount that lasted for several years.Source: docroot/ir/caselaw/f3d_922.jsonl#/f3d/922/0762-01; Unicode character offsets [3710:3818] (end exclusive); SHA-256 e8ef7181fd7c4c0d1625b6886392822112d781901a03a369c30766e369d8be7e.Newborn did testify that in some circumstances unwritten discounts violate Sarbanes-Oxley.Source: docroot/ir/caselaw/f3d_922.jsonl#/f3d/922/0762-01; Unicode character offsets [4749:4839] (end exclusive); SHA-256 e8ef7181fd7c4c0d1625b6886392822112d781901a03a369c30766e369d8be7e.A fraudulent scheme must include a material misrepresentation, which is a misrepresentation that could influence the decision of a "person[ ] of ordinary prudence and comprehension."Source: docroot/ir/caselaw/f3d_922.jsonl#/f3d/922/0762-01; Unicode character offsets [1835:2017] (end exclusive); SHA-256 e8ef7181fd7c4c0d1625b6886392822112d781901a03a369c30766e369d8be7e.Thus, Petlechkov's false statement was capable of influencing FedEx's decision.Source: docroot/ir/caselaw/f3d_922.jsonl#/f3d/922/0762-01; Unicode character offsets [3630:3709] (end exclusive); SHA-256 e8ef7181fd7c4c0d1625b6886392822112d781901a03a369c30766e369d8be7e.Despite Petlechkov's arguments to the contrary, a rational juror could have found his misrepresentation material.Source: docroot/ir/caselaw/f3d_922.jsonl#/f3d/922/0762-01; Unicode character offsets [5121:5234] (end exclusive); SHA-256 e8ef7181fd7c4c0d1625b6886392822112d781901a03a369c30766e369d8be7e. |
| Neder v. United States — 527 U.S. 1 (1999) · Supreme Court of the United States · 1999 — not reached (18usc1341: author: Fable · not independently reviewed) | Material deception | not_reached Excluded from merits counts rule-announced / meritsThe Court construes "scheme or artifice to defraud" to carry the common-law materiality requirement, but does not decide whether Neder's misstatements to the lenders were material or whether omitting the element was harmless on the fraud counts; that goes back to CA11. The fact lines are the Court's background recital of the lending schemes (and the instruction given), not findings on materiality; the absent-tagged line is a procedural fact, not conduct. Materiality standard: footnote 5 quotes the Restatement (Second) of Torts 538 definition (reasonable person would attach importance, or maker knows the recipient does); the Part II Gaudin "natural tendency to influence" formulation is stated for the tax counts. | common-law-fraud-incorporation/materiality-omitted-from-jury-instruction | In so doing, he concealed from lenders that he controlled the shell corporations, that he had purchased the land at prices substantially lower than the inflated resale prices, and that the limited partnerships had not made substantial down payments as represented.Source: docroot/ir/caselaw/us_527.jsonl#/us/527/0001-01; Unicode character offsets [1174:1438] (end exclusive); SHA-256 e0a4af797b1293eb68136f29db1ed43b57bd1627cee70ab67e5a05c81288e673.To obtain the loan, he falsely represented to the lender that he had satisfied a condition of the loan by making advance sales of 20 condominium units.Source: docroot/ir/caselaw/us_527.jsonl#/us/527/0001-01; Unicode character offsets [2094:2245] (end exclusive); SHA-256 e0a4af797b1293eb68136f29db1ed43b57bd1627cee70ab67e5a05c81288e673.Between September 1987 and March 1988, he submitted numerous requests based on false invoices, the lender approved the requests, and he obtained almost $8 million unrelated to any work actually performed.Source: docroot/ir/caselaw/us_527.jsonl#/us/527/0001-01; Unicode character offsets [2926:3130] (end exclusive); SHA-256 e0a4af797b1293eb68136f29db1ed43b57bd1627cee70ab67e5a05c81288e673.In instructing the jury on mail fraud and wire fraud, the District Court did not include materiality as an element of either offense.Source: docroot/ir/caselaw/us_527.jsonl#/us/527/0001-01; Unicode character offsets [4518:4651] (end exclusive); SHA-256 e0a4af797b1293eb68136f29db1ed43b57bd1627cee70ab67e5a05c81288e673.Thus, under the rule that Congress intends to incorporate the well-settled meaning of the common-law terms it uses, we cannot infer from the absence of an express reference to materiality that Congress intended to drop that element from the fraud statutes.Source: docroot/ir/caselaw/us_527.jsonl#/us/527/0001-01; Unicode character offsets [34460:34716] (end exclusive); SHA-256 e0a4af797b1293eb68136f29db1ed43b57bd1627cee70ab67e5a05c81288e673.Accordingly, we hold that materiality of falsehood is an element of the federal mail fraud, wire fraud, and bank fraud statutes.Source: docroot/ir/caselaw/us_527.jsonl#/us/527/0001-01; Unicode character offsets [38141:38269] (end exclusive); SHA-256 e0a4af797b1293eb68136f29db1ed43b57bd1627cee70ab67e5a05c81288e673.we remand this case to the Court of Appeals for it to consider in the first instance whether the jury-instruction error was harmless.Source: docroot/ir/caselaw/us_527.jsonl#/us/527/0001-01; Unicode character offsets [38417:38550] (end exclusive); SHA-256 e0a4af797b1293eb68136f29db1ed43b57bd1627cee70ab67e5a05c81288e673. |
Court interpretations
interpretation
Accordingly, we hold that materiality of falsehood is an element of the federal mail fraud, wire fraud, and bank fraud statutes.
Neder v. United States — 527 U.S. 1 (1999) · Supreme Court of the United States · 1999 (18usc1341: author: Fable · not independently reviewed)
Accordingly, we hold that materiality of falsehood is an element of the federal mail fraud, wire fraud, and bank fraud statutes.Source:
docroot/ir/caselaw/us_527.jsonl#/us/527/0001-01; Unicode character offsets [38141:38269] (end exclusive); SHA-256 e0a4af797b1293eb68136f29db1ed43b57bd1627cee70ab67e5a05c81288e673.Judge-made incorporation of common-law fraud, not an express word in this statute. Petlechkov supplies the Sixth Circuit's ordinary-prudence formulation, not a uniform national definition. Kousisis leaves unresolved the parties' competing formulations of the materiality standard; it does not adopt an essence-of-the-bargain test as an additional universal element.
interpretation
A fraudulent scheme must include a material misrepresentation, which is a misrepresentation that could influence the decision of a "person[ ] of ordinary prudence and comprehension."
U.S. v. Petlechkov — 922 F.3d 762 (2019) · United States Court of Appeals for the Sixth Circuit · 2019 (18usc1341: author: Flash3 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md))
A fraudulent scheme must include a material misrepresentation, which is a misrepresentation that could influence the decision of a "person[ ] of ordinary prudence and comprehension."Source:
docroot/ir/caselaw/f3d_922.jsonl#/f3d/922/0762-01; Unicode character offsets [1835:2017] (end exclusive); SHA-256 e8ef7181fd7c4c0d1625b6886392822112d781901a03a369c30766e369d8be7e.Judge-made incorporation of common-law fraud, not an express word in this statute. Petlechkov supplies the Sixth Circuit's ordinary-prudence formulation, not a uniform national definition. Kousisis leaves unresolved the parties' competing formulations of the materiality standard; it does not adopt an essence-of-the-bargain test as an additional universal element.