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Touchdown in reach for ‘Varsity Blues’ parents at 1st Circuit

Two families made six-figure payments to get their kids into USC, but the appeals court looks unlikely to label those checks as bribes.

BOSTON (CN) — The First Circuit gave a sympathetic hearing Monday to two wealthy executives convicted in the “Varsity Blues” college admissions scandal who insisted that they acted completely innocently in making more than $500,000 in donations to the University of Southern California’s athletic department in return for getting their children admitted with puffed-up athletic profiles.

“You have to pile inference on top of inference” to believe that the parents knew they were participating a nationwide fraud conspiracy, Chief U.S. Circuit Judge David Barron said at oral arguments this afternoon in Boston.

Assistant U.S. Attorney Alexia De Vincentis replied that there was “overwhelming evidence” that the parents knew what they were doing was wrong. “They were sending in photos of their kids. They were editing their children’s essays,” she noted.

But “that’s the kind of thing that parents do all the time,” U.S. Circuit Judge Kermit Lipez observed.

Things went so badly for the government that the judges spent much of the two-hour argument debating whether, if they found for the defendants, they should order a new trial or throw the case out altogether.

Most of the prominent parents caught up in the scandal pleaded guilty, including actresses Lori Loughlin and Felicity Huffman. But John Wilson and Gamal Abdelaziz went to trial and were convicted of bribery and fraud. Wilson runs a hedge fund and is a former president of Staples; Abdelaziz is a top casino executive.

Altogether dozens of parents were accused of paying more than $25 million to ringleader Rick Singer to gain college admissions between 2011 and 2018. More than half the tainted admissions were to USC.

Wilson and Abdelaziz claimed that Singer told them that making donations in return for admissions preferences was legal and above-board, and they had no reason to doubt him. They said they had no idea that Singer was altering their children’s applications to make them sound more impressive.

A key argument is that it’s not a “bribe” if the beneficiary of the payment — in this case, USC — is also the alleged victim of the scheme.

“The government has not identified a single case in all of American history” that says that paying money to an institution in return for a benefit is a bribe, argued Wilson’s lawyer, Noel Francisco of Jones Day in Washington, who served as U.S. solicitor general under President Trump.

Saying that the government “jumped the shark,” he added that, “if Congress wanted to overturn the entire history of bribery jurisprudence, it had to say so.”

Barron, an Obama appointee, agreed that “there needs to be proof of private gain” to establish a bribe. “Otherwise it’s not a bribe, it’s a gratuity.”

U.S. Circuit Judge Sandra Lynch, who was appointed by President Clinton, seemed to agree.

“Suppose a guy wants to get his son into a school, the school says no. The guy says, 'I’ll make a $150 million donation if you let him in,' and the school says yes. Is that corrupt intent?” she asked. “I always thought corruption turned on some deception. But here there was none.”

The defendants claimed that USC had a “culture” of accepting students with dubious athletic credentials in return for large donations, but the trial judge refused to let them put on evidence that this was a common practice at the school. They said such evidence would have established that it was reasonable for them to believe that the donations were perfectly legitimate.

“How can you argue that that evidence would not be relevant?” Lipez, a Clinton appointee, demanded of De Vincentis. “I can’t understand that.”

Wilson and Abdelaziz also argued that their trials consisted of the government inflaming the jurors by telling them about terrible things that other parents did — such as cheating on SATs — without proving that they did the same things.

There was “an avalanche of evidence of bad acts by other parents,” complained Abdelaziz’s lawyer, Joshua Sharp of Nixon Peabody in Boston.

The government claimed the pair knew about and participated in a conspiracy with the other parents, but they said this was ridiculous.

“John Wilson didn’t give two hoots whether … Lori Loughlin’s kid got in” to USC, Francisco said. “In fact, they were competing.”

A third issue was whether a school admission is “property,” within the meaning of the bribery and fraud statutes. De Vincentis argued that an admission has “exclusivity and economic value,” but Francisco countered that such an interpretation would “criminalize any misstatement on a kindergarten application. If I say my daughter is kind and I ignore her temper tantrums, that’s property fraud.”

The judges debated among themselves whether, if they agreed that the defendants were prejudiced by the evidence of other parents’ misdeeds, they had to decide the more complicated legal questions or whether they were irrelevant because a new trial would be barred by Double Jeopardy. By the time De Vincentis got up to argue, things appeared so dire for her side that her first point was that the defendants had only asked for a new trial in their briefs.

“But that doesn’t prevent a double-jeopardy claim on remand,” Barron pointed out.

And Lynch didn’t even agree with her premise. “I read their briefs as asking for an acquittal,” she said.

Only one parent has been acquitted at trial in the scandal: aviation mogul Amin Khoury, who was found not guilty in June 2022 of slipping a Georgetown tennis coach nearly $200,000 in cash in a brown paper bag.

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