Cookies, cocktails and mushrooms on menu as Supreme Court hears bank fraud case

in Lively debate at the Supreme Court In a trial Tuesday that included references to cookies, cocktails and poisonous mushrooms, a judge in the case of a Chicago politician convicted of making false statements to banking regulators said: tried to find the line between misleading statements and outright lies.
The case concerns former Chicago City Councilman Patrick Daley Thompson, the grandson of one former mayor, Richard J. Daley, and the nephew of another, Richard M. Daley. He admitted he had misled regulators, but said his statements fell short of the outright falsehood needed to constitute a crime.
The justices asked lawyers a variety of questions that sought to clarify the difference between false statements and misleading statements.
Chief Justice John G. Roberts Jr. ruled that a driver he pulled over for impaired driving falsely stated he had one cocktail, omitting that he had had four glasses of wine. I asked him if he had done so.
Federal attorney Caroline A. Flynn said the jury could not find the statements to be false because “officers wanted a full account of how much the person had to drink.” He said it could be approved.
Judge Ketanji Brown Jackson asked about a child who admitted to eating three cookies instead of 10.
Flynn said context is important.
“If a mother says, “Did you eat all the cookies?” or “How many cookies did you eat?” and the child says, “You ate three cookies” when the child ate 10, that’s a lie. “It’s a statement,” she says. Flynn said. “But if a mother says, ‘Did you eat cookies?’ and the child answers three, that’s not an underestimation of the answer to a specific numerical question.”
Justice Sonia Sotomayor asked whether it was wrong to label poisonous mushrooms as “100% natural.” Mr. Flynn did not respond directly.
The court case, Thompson v. United States, No. 23-1095, began when Mr. Thompson took out three loans from Washington Federal Savings Bank between 2011 and 2014. He used his first $110,000 in legal funding. Hard. He used $20,000 from his next loan to pay his taxes. He used the third $89,000 to pay off a loan to another bank.
He repaid the loan in 2012 for a lump sum of $390, but the bank did not ask him to make further payments, but the bank went bankrupt in 2017.
When the Federal Deposit Insurance Corporation and the debt servicer it hired sought repayment of the loan, plus interest, for about $270,000, Mr. Thompson told them he had borrowed $110,000, which is narrowly true. It was incomplete.
As a result of negotiations, Mr. Thompson repaid the principal in 2018, but not the interest. More than two years later, federal prosecutors charged him with violating a law that makes it a crime to make “false statements or reports” to influence the FDIC.
He was convicted and ordered to pay back approximately $50,000 in interest. He served four months in prison.
Mr. Thompson’s attorney, Chris C. Gale, said his client’s statements were accurate in context, but the claim was met with skepticism. Justice Elena Kagan ruled that in order for the jury to find the statements to be false and rule in favor of Mr. Thompson, the court could not have reached that conclusion by a reasonable jury. He pointed out that it was necessary to make a decision.
Justices Neil M. Gorsuch and Brett M. Kavanaugh said the issue was not on the agenda of the court, which agreed to decide the legal question of whether federal law covers misleading statements as a general matter. said. A lower court could decide whether Mr. Thompson was properly convicted, they said.
Justice Samuel A. Alito Jr. asked for examples of misleading statements that are not false. Mr. Gale, who was arguing before the Supreme Court for the first time, responded by speaking for himself.
“If I went back and changed my website to say “40 years of litigation experience,” and then put “Supreme Court attorney” in bold, that would be a true statement from today onwards. Would you hire me? For those who are wondering, that would be misleading.”
Justice Alito said such statements were, at best, mildly misleading. But Justice Kagan was impressed.
“Well, but that’s the most humble answer I’ve ever heard from the Supreme Court podium,” she said, drawing laughter. “It was a very good show.”