United States v. Gary S. Stevens

Rule of Law:

A sole stockholder who completely controls a corporation and is the only human actor involved in the corporation's activities cannot be convicted of a criminal conspiracy with that corporation, as there is no agreement between two or more autonomous minds.

Facts:

• Gary S. Stevens formed four corporations in Florida to perform government contract work.
• Stevens was the sole shareholder of these corporations and exercised complete control over their operations.
• The corporations entered into a contract with the U.S. Navy to build a storage and retrieval system at a naval shipyard.
• The contract allowed for periodic progress payments from the government as specific project milestones were completed.
• Stevens, acting as the sole agent for his corporations, submitted multiple requests for progress payments that falsely claimed certain work had been performed.
• Stevens also applied for personal and commercial loans from several federally insured banks, fraudulently listing the anticipated income from the Navy contract as security.

Procedural Posture:

• Gary S. Stevens was indicted in federal district court on charges of conspiracy, presenting false claims, making false statements, and bank fraud.
• During jury deliberations at trial, the jury submitted a written question to the judge asking if a person can conspire with their own corporation if they are the only agent.
• The district court judge instructed the jury that a person could legally conspire with his wholly-owned corporation.
• The jury returned a verdict convicting Stevens on the conspiracy count and the other substantive charges.
• Stevens, as the appellant, appealed his convictions to the United States Court of Appeals for the Eleventh Circuit, challenging the conspiracy conviction and other aspects of his sentence.