players were ineligible to participate in intercollegiate athletics. The colleges were thus induced to continue financial support through fraud. These affirmative misrepresentations are analogous to an initial fraudulent inducement to contract, since the continuation of scholarship payments was dependent upon continued eligibility. According to the court in Regan, such an inducement constitutes "garden variety mail fraud." Regan, 713 F.Supp. at 637.
Furthermore, the court in Regan explained that the indictment was deficient because it charged the defendants with depriving Mattel of an "intangible right." As the court stated, "a right to honest and faithful performance of contractual obligations is not property for purposes of the mail and wire fraud statutes." Regan, 713 F.Supp. at 636. In contrast, the scholarships were not intangible and were not awarded as consideration for continued player eligibility. Rather, the continued receipt of scholarship funds was contingent on continued eligibility. Walters' offense was that he executed agreements which, by their very existence, made the players ineligible to receive scholarship money. At the same time, he allegedly knew 1) that misrepresentations would subsequently be made to insure that the players continued to receive the aid, and 2) that those misrepresentations were necessary to the success of his scheme.
Defendant has failed to support his position that a scheme must have as its "affirmative objective" the deprivation of money or property in order to make out an offense under the mail fraud statute. A more sensible interpretation of the statute would indicate that a scheme is devised "for obtaining" money or property when the defendant knows that its success requires a specific fraudulent deprivation of money or property. That deprivation need not be the "affirmative goal" or the "ultimate objective" of the schemers. Indeed, the deprivation of money or property need not directly benefit the schemers, so long as it advances the scheme. See Lombardo v. U.S., 865 F.2d 155, 159-160 (7th Cir. 1989), cert. denied, 491 U.S. 905 , 105 L. Ed. 2d 695 , 109 S. Ct. 3186 (1989); See also U.S. v. Diwan, 864 F.2d 715, 719-20 (11th Cir. 1989), cert. denied, 492 U.S. 921 , 106 L. Ed. 2d 595 , 109 S. Ct. 3249 (1989).
Defendant is correct in one respect: an indictment does not charge an offense under the mail fraud statute simply because the scheme "results" in a deprivation of money or property. In order to convict, a jury must believe that the defendant operated with the intent to obtain money or property by fraud. U.S. v. Reicin, 497 F.2d 563, 571 (7th Cir. 1974), cert. denied, 419 U.S. 996 , 42 L. Ed. 2d 269 , 95 S. Ct. 309 (1974); U.S. v. Feldman, 711 F.2d 758, 763 (7th Cir. 1983), cert. denied, 464 U.S. 939, 104 S. Ct. 352, 78 L. Ed. 2d 317 (1983).
B) Relevance of pre-scheme eligibility
Defendant also maintains that this prosecution is precluded by the fact that the scholarship money would have been paid to the players in the absence of defendant's scheme. Neither existing case law nor the language of the mail fraud statute support defendant's interpretation. The statute punishes a scheme devised to obtain money or property by fraud. It does not follow that in order to constitute mail fraud the money or property would not have been obtained without the scheme. Here, once the representation agreements were executed, the players could only obtain scholarship money by fraudulently representing that they were eligible to play football.
Furthermore, a brand new deprivation occurred as a result of defendant's scheme: the colleges were deprived of their right to allocate athletic scholarships on the basis of truthful representations as to each player's elgibility. The right to control the allocation of athletic scholarships is a right protected by the mail fraud statute. See U.S. v. Walters, 711 F. Supp. 1435, 1445 (N.D. Ill 1989); See also Carpenter v. U.S., 484 U.S. 19, 108 S. Ct. 316, 98 L. Ed. 2d 275 (1987). Defendant's motion to dismiss the indictment for failure to make out an offense under 18 U.S.C. § 1341 is denied.
Defendant's Knowledge of False Statements
Defendant contends that the evidence produced during his first trial was insufficient to support a finding that he knew about the false statements which the athletes made to their respective colleges. Therefore, defendant maintains, his prosecution is now barred by the Double Jeopardy Clause of the Constitution.
Defendant misstates the rule of law to be applied on a motion to dismiss the indictment. Defendant's convictions were reversed due to trial error, not because the evidence was insufficient to support the verdict. Defendant, therefore, "can be retried even if the evidence introduced at trial would not have been sufficient to sustain his conviction but for the error -- even if, in other words, the government will have to put in new evidence on retrial to convict him." U.S. v. Holzer, 840 F.2d 1343, 1349 (7th Cir. 1988); See Burks v. U.S., 437 U.S. 1, 16, 98 S. Ct. 2141, 2149, 57 L. Ed. 2d 1 (1978) ("reversal for trial error, as distinguished from evidentiary insufficiency, does not constitute a decision to the effect that the government has failed to prove its case.") In testing the sufficiency of the indictment at this stage, the court must only make certain that it "contains the elements of the offense charged and adequately informs the defendant of the specific charges against him. . . ." U.S. v. Brack, 747 F.2d 1142, 1146 (7th Cir. 1984), cert. denied, 469 U.S. 1216 , 84 L. Ed. 2d 339 , 105 S. Ct. 1193 (1985).
After examining the indictment, the court is persuaded that it adequately informs defendant of the charges against him. The surviving mail fraud counts in the indictment charge defendant with the intent to engage in a scheme to defraud the University of Michigan and Purdue University of money or property. Those counts also allege that, in order to execute the scheme, defendant "knowingly caused" the eligibility certificates to be delivered through the mails. Superceding Indictment, Counts II and V.
These counts spell out the charges and elements of the offense in considerable detail, and specifically allege that defendant possessed the "intent" to defraud the colleges of money or property. The counts are, therefore, sufficient to withstand defendant's motion to dismiss.
Defendant may be correct in his belief that the evidence likely to be advanced by the government at trial will be insufficient to support a guilty verdict. The court does not intimate a view on this issue one way or another; defendant may raise these concerns through a motion for directed verdict at trial. The indictment, however, is sufficient on its face. Defendant's motion to dismiss the indictment for failure to allege the requisite element of intent is denied.
The "In Furtherance Of" Requirement
Finally, defendant argues that the indictment should be dismissed because the mailings were not made "in furtherance of" the scheme. In order for defendant to prevail on his motion, the court must believe that "there is no conceivable evidence that the government could produce at trial" to substantiate its allegation that the eligibility forms were mailed in furtherance of the scheme. U.S. v. Castor, 558 F.2d 379, 384-85 (7th Cir. 1977), cert. denied, 434 U.S. 1010 , 54 L. Ed. 2d 752 , 98 S. Ct. 720 (1978).
The court is not without guidance on this question. Bloom argued this very point in a pre-trial motion to dismiss the indictment in Walters I. At that time Judge Marovich explained how the mailings could have been used to execute the alleged scheme:
a jury could reasonably conclude that the mailings in this case are an essential part of the scheme because they facilitated concealment of the scheme. If the universities or the Big Ten Conference had been given truthful information on the forms, the universities could have terminated the student-athletes' football scholarships and prevented the athletes from playing with the team. Such an occurrence could seriously affect a particular athlete's value to defendants.
Walters, 711 F.Supp. at 1440.
Defendant does not provide the court with any reason to believe that Judge Marovich's analysis is unsound. NCAA regulations did not prevent defendant's stable of players from signing contracts and foregoing their college eligibility for immediate entrance into the pro draft. Very few players, however, avail themselves of that opportunity. A player in his junior year of college is unlikely to have demonstrated the proven ability necessary to justify a lucrative professional contract. The fact that the players signed by defendant chose not to forego their senior year adds weight to this observation. If a player's prospect of signing such a contract was diminished because he was rendered ineligible to play intercollegiate football, defendant's commission under the representation agreement would be adversely effected. The players' misrepresentations concerning their eligibility were therefore "essential to the perpetration and concealment of the alleged fraud." Id. at 1441.
Furthermore, the government is not required to show that defendant actually intended to use the mails, only that their use was reasonably foreseeable. See Pereira v. U.S., 347 U.S. 1, 8-9, 74 S. Ct. 358, 363, 98 L. Ed. 435 (1954). The eligibility statements which the players were asked to sign were forms provided by the Big Ten. The regulations required the colleges to submit these forms to the Big Ten headquarters in Schaumburg, Illinois. From these facts a jury could certainly conclude that the use of the mails to effect the submission of the forms was reasonably foreseeable. Walters' motion to dismiss the indictment for failure to satisfy the "in furtherance of" requirement is therefore denied.
Defendant's motion to dismiss the indictment is denied.
IT IS SO ORDERED.