Former Chicago Alderman Challenges Federal False Statements Conviction in Supreme Court Appeal
The Supreme Court heard arguments in Thompson v. United States, a case involving Patrick Daley Thompson, a former Chicago alderman convicted of making false statements to bank regulators. Thompson, a member of Chicago’s prominent Daley political family, challenges his conviction under a federal law prohibiting false statements to influence the FDIC. He argues that the law applies only to demonstrably false statements, not those that are merely misleading, as he contends his were.
Thompson’s case stems from loans he took from Washington Federal Bank for Savings, which later failed. Prosecutors alleged that Thompson misrepresented the amount he owed to a loan servicer working for the FDIC after the bank’s collapse. They argued that Thompson’s omission of two of the three loans constituted a false statement, intending to influence the FDIC’s recovery efforts. Thompson maintains that while his statements might have been incomplete, they were not factually incorrect, thus falling outside the scope of the law.
During oral arguments, Thompson’s attorney, Chris Gair, emphasized the distinction between "false" and "misleading," asserting that the law explicitly targets only falsehoods. He highlighted other sections of the U.S. Code where Congress specifically prohibits both false and misleading statements, suggesting that the absence of such language in the law under which Thompson was convicted indicates a deliberate limitation of its scope. Gair requested the justices to remand the case to lower courts to determine whether Thompson’s statements were truly false or simply misleading.
The government, represented by Caroline Flynn, Assistant to the U.S. Solicitor General, countered that the law prohibits "any false statement," including those that convey an untrue message within a given context. She argued that Thompson’s statements, considered in the context of the bank’s failure and the FDIC’s investigation, created a false impression about the extent of his indebtedness. The core of the disagreement seemed to hinge on the definition of "false statement" and whether it encompasses true but incomplete statements that create a misleading impression.
The justices grappled with the complexities of defining "falsity" in legal terms. Gair acknowledged that falsity depends on context, including the question asked, the statement itself, and surrounding facts. He provided a hypothetical example: had Thompson stated he borrowed "only" $110,000, that would be definitively false. Flynn concurred that context matters but disagreed with Gair’s proposed definition, emphasizing the listener’s likely interpretation based on the conversation and circumstances. She contended that a statement is false if it presents a partial truth that would be perceived as both accurate and complete.
Several justices expressed skepticism about remanding the case, questioning whether Thompson’s statements could be considered false even under a narrow interpretation of the law. Justice Ketanji Brown Jackson questioned the need for further review when the total loan amount was a known fact and Thompson’s response to the invoice seemed tantamount to a false statement. Justice Sonia Sotomayor also viewed Thompson’s statements as potentially false, suggesting that omitting significant portions of the truth could constitute a literal falsehood. She emphasized the jury instructions focused on falsity, not misleading nature.
Justice Elena Kagan pressed Gair on whether any reasonable jury could have found Thompson’s statements false, given the jury instructions. She suggested that if the Court disagreed with his argument, it should resolve the issue directly rather than remanding the case. Justice Samuel Alito questioned how the "misleading statements" issue arose, suggesting it might stem from errors by the court of appeals. He questioned the need for remanding the case if Thompson’s core argument was that no reasonable jury could deem his statement false.
Justices Brett Kavanaugh and Neil Gorsuch raised caution about addressing the broader definition of "false statement" in this case. Kavanaugh suggested that if the Court wished to tackle such a potentially impactful issue, it should wait for more comprehensive briefing, including from outside parties. Gorsuch concurred, noting the potential ripple effects on various federal statutes criminalizing false statements and suggesting the need for philosophical considerations. Justice Amy Coney Barrett proposed a simpler approach, suggesting the Court adopt a straightforward definition of "false" from existing jury instructions, which Flynn accepted.
Gair argued for a definitive ruling on the legal question, citing the broad application of the statute and the risk of overzealous prosecution in dealings between individuals and financial institutions. Kavanaugh and Gorsuch echoed this sentiment, emphasizing the importance of addressing the central legal question – whether the statute encompasses misleading statements – rather than dissecting Thompson’s specific statements. The Court’s decision, expected by summer, will have implications for the interpretation of federal false statement laws and potentially impact future prosecutions.
