Seventh Circuit reverses corruption conviction.

Byline: David Ziemer

A pay raise is not a "private benefit" that supports a mail fraud conviction under 18 U.S.C. 1341 and 1346. Nor does it violate 18 U.S.C. 666 for a public official to factor in political considerations in awarding contracts. On April 20, the Seventh Circuit issued its written decision, explaining its reasons for reversing the conviction of Georgia Thompson, a section chief in Wisconsin's Bureau of Procurement. In 2005, Wisconsin selected Adelman Travel Group as its travel agent for about 40 percent of its annual travel budget of $75 million. Thompson presided over the selection process. According to the court's decision, Adelman Travel was the low bidder, but under Wisconsin's procurement rules, this consideration is given only a 25 percent weight. 58 percent is based on service, and 27 percent is based on oral presentation. Omega World Travel had the highest total score after weighing all three factors. However, Thompson steered the committee to award the contract to Adelman Travel. Thompson was charged and convicted in federal court with violating 18 U.S.C. 666, 1341, and 1346. Evidence was presented at trial that Thompson received a $1,000 annual raise three months after the committee's decision, and that one of the principal owners and managers of Adelman Travel made contributions to the campaign of Wisconsin's governor both before and after the contract selection. Thompson appealed, and the Seventh Circuit reversed, in a decision by Judge Frank H. Easterbrook, which observed, "There is not so much as a whiff of a kickback or any similar impropriety." The court acknowledged that one possible interpretation of Thompson's actions is that the contract was awarded to Adelman Travel because of its financial support of the Governor. Even if this were the case, however, the court found that it would, at most, violate the First Amendment limits on awarding or withholding public contracts based on political support; it would not support a criminal conviction. The court found two other possible motives: Adelman Travel was the lowest bidder; and Adelman Travel was a local firm, while Omega was an out-of-state company. Both motives, the court concluded, would be "political," but not criminal. Addressing sec. 666 first, the court held Thompson's conduct was not criminal for several reasons. First, it noted that the government saved money as a result; thus, she could not have "misapplied" property. Second, the court looked to the...