Plain-English summary
Court unanimously rejects Second Circuit 'right-to-control' theory of wire fraud
The Court unanimously held that the Second Circuit’s "right-to-control" theory — treating withholding of information that affects economic decisions as property fraud under the federal wire fraud statute — is not a valid basis for conviction. The case was reversed and remanded for further proceedings consistent with the opinion.
Why this matters
The decision limits the Government’s ability to use the federal wire fraud statute to prosecute schemes that rely primarily on withholding information or misleading about non-tangible economic advantages, rather than schemes that seek to take money or other traditional property. That narrowing affects many fraud prosecutions and clarifies the boundary between garden-variety lies or omissions and federal property-fraud offenses.
Who may feel it
- Defendants in federal fraud prosecutions, especially in the Second Circuit
- Federal prosecutors and the Department of Justice
- Business actors and contracting parties whose disputes involve alleged omissions or misleading conduct
- Companies and individuals seeking clarity about when deceptive conduct becomes a federal crime