Wednesday, July 04, 2007

Independent Contractors With No Control Over Federal Funds Are "Agents" Under Section 666 and Prosecutors' Vouching Deemed Harmless Error

In United States v. Vitillo, No.05-4330 (3d Cir. June 25, 2007), the Third Circuit affirmed the conviction of John Vitillo and two of his companies on several counts of theft and conspiracy in violation of 18 U.S.C. § 666, which prohibits theft from organizations and government agencies that receive more than $10,000 in federal funds. The Court rejected Vitillo’s argument that he was not an "agent" for purposes of § 666 because he did not have control over the federal funds. It explained that, according to the statutory definition, an "agent" is "merely a person with authority to act on behalf of the organization receiving federal funds," which can include independent contractors.

During the government’s investigation of Vitillo’s billing practices, the two AUSAs who later served as trial counsel accompanied the FBI agents who executed a search warrant at the defendant’s office. These prosecutors were also present during the FBI’s subsequent interrogation of Vitillo. The agent who conducted the interview testified at trial that Vitillo confessed; Vitillo testified to the contrary. During the government’s opening statement and witness examination, the prosecutors made repeated reference to their presence at the FBI raid and the defendant’s interview. The Court expressed concern over this "ill-advised" practice and suggested that the trial counsel either should not have attended the interview or should not have served as trial counsel. It held that the prosecutors’ comments and questions referring to their presence at the defendant’s interview constituted improper vouching because it implied that the prosecutors knew that the agent was testifying truthfully.

The Court also held that under its recent decision in United States v. Harris, 471 F.3d 507 (3d Cir. 2006), it was improper for the prosecutor to explicitly ask Vitillo whether the agent who interviewed him was lying because this type of questioning tends to infringe upon the jury’s exclusive role as the arbiter of credibility. Despite these instances of prosecutorial misconduct, however, the Court concluded that a new trial was not warranted because of the "overwhelming" evidence of the defendants’ guilt.

Finally, the Court held that the district court’s determination of the amount of restitution ($317,760) was supported by a preponderance of the evidence.

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