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UNITED STATES v. MACHI

May 1, 1997

UNITED STATES OF AMERICA, Plaintiff, against SALVATORE MACHI, Defendant.


The opinion of the court was delivered by: BAER

 HAROLD BAER, JR., District Judge:

 By oral opinion delivered April 2, 1997, I sentenced the defendant for conspiracy to violate and substantive violations of 18 U.S.C. § 1920. The sentence was based in part on a disputed determination of the appropriate offense level under the Sentencing Guidelines. I write now to clarify my reasoning on this issue, which the Second Circuit has yet to address.

 Defendant Salvatore Machi pled guilty to a two-count indictment charging him with: (1) conspiracy to falsely represent his employment status in connection with applications for worker's compensation payments in violation of 18 U.S.C. § 1920 and (2) substantive violations of 18 U.S.C. § 1920 for such false representations. The government and defendant disagree as to the appropriate calculation of the offense level under the Sentencing Guidelines. For the reasons discussed below, I adopt defendant's argument and sentence him accordingly.

 I. Background

 The relevant facts are not in dispute. Mr. Machi was employed as a food service foreman for the Department of Veterans Affairs Medical Center until July 1990. Presentence Report at P 10. In July 1990, Mr. Machi filed a claim for worker's compensation under the Federal Employees Compensation Act, 5 U.S.C. 1001, et seq., based on an alleged lower back injury. Id. Mr. Machi continued to work intermittently until December 1990, at which time he suffered a recurrence of his back injury. Id. at P 11. From December 1990 to March 1996 Mr. Machi received over $ 122,000 in worker's compensation payments. Id. at P 12. Unbeknownst to the government at the time, Mr. Machi was apparently running various limousine businesses from 1990 to 1996. Id. at PP 2047.

 II. Discussion

 Defendant contends that his conduct in failing to report his self-employment was not criminalized until September 30, 1994, when 18 U.S.C. § 1920--the statute under which Mr. Machi was charged--was amended. The pre-amendment version of Section 1920 reads:

 
Whoever makes, in an affidavit or report required by section 8106 of title 5 or in a claim for compensation under subchapter I of chapter 81 of title 5, a statement, knowing it to be false, is guilty of perjury ....

 The amended version of the statute reads:

 
Whoever knowingly and willfully falsifies, conceals, or covers up a material fact, or makes a false, fictitious, or fraudulent statement or representation, or makes or uses a false statement or report knowing the same to contain any false, fictitious, or fraudulent statement or entry in connection with the application for or receipt of compensation or other benefit or payment under subchapter I or III of chapter 81 of title 5, shall be guilty of perjury ....

 The principle difference is that the earlier version applies only to false statements made in an "affidavit or report required by section 8106 of title 5." *fn2" By contrast, the new version applies to any fraudulent statement made "in connection with the application for or receipt of" benefits. Defendant argues that because he was not required under section 8106 to file the forms relied upon by the government in the indictment, the earlier version of the statute cannot apply to his conduct. *fn3"

 Section 8106 applies to partially disabled individuals and specifically authorizes the Secretary of Labor to require a partially disabled employee to report his earnings periodically. 5 U.S.C. § 8106. Mr. Machi, however, was not partially disabled. Rather, he was classified by OWCP as temporarily totally disabled. Any reports filed by Mr. Machi were either filed voluntarily or pursuant to the Secretary's presumed authority to require reports from totally disabled individuals under 5 U.S.C. § 8105, which applies to totally disabled individuals. See United States v. Austin, 817 F.2d 1352, 1355 (9th Cir. 1987) (though § 8105 does not contain express grant of authority to require reports from totally disabled individuals, "it is implicit in the statutory scheme for the Department to make inquiries to determine whether the disability or dependency has ...


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