The Supreme Court on Friday overturned the conviction of a former Chicago politician for making misleading statements to bank regulators that were deemed not to be false.
The case involved Patrick Daley Thompson, a former Chicago alderman and member of a prominent political family. Thompson acknowledged that he had misled regulators but argued that this did not constitute a criminal act.
Chief Justice John G. Roberts Jr., writing for a unanimous court, emphasized the distinction between false and misleading statements. He noted that the law prohibited making “any false statement or report,” asserting that misleading statements can still be true, thus not all misleading statements are false.
The case, Thompson v. United States, No. 23-1095, originated from Thompson taking out three loans from Washington Federal Bank for Savings between 2011 and 2014. He used the first loan of $110,000 to finance a law firm, the second for a $20,000 tax bill, and the third for $89,000 to repay another bank debt. Thompson made only one payment of $390 in 2012 before the bank failed in 2017.
When the Federal Deposit Insurance Corporation (FDIC) sought repayment of approximately $270,000, Thompson told them he had borrowed $110,000, a statement that was technically true but incomplete.
After negotiations, Thompson repaid the principal in 2018 but did not pay the interest. He was later charged by federal prosecutors with violating a law against providing “any false statement or report” to influence the FDIC.
Thompson, who was elected to the Chicago City Council in 2015, resigned following his conviction in 2022 and was sentenced to repay about $50,000 in interest, serving four months in prison.
Chief Justice Roberts pointed out that many federal laws include prohibitions against both “false or misleading statements,” indicating that the absence of misleading statements in the law relevant to Thompson’s case was significant.
Roberts illustrated his point with examples of true but misleading statements, such as a tennis player claiming to have “won the championship” when the opponent forfeited, or a doctor stating he had “done a hundred surgeries” when the majority of patients had died.
The Supreme Court remanded the case to the appeals court to determine whether Thompson’s statements were false in context rather than merely misleading.
In a concurring opinion, Justice Samuel A. Alito Jr. noted the importance of context, providing an example of a child who, when asked if she ate all the cookies, claims to have eaten three while actually consuming all twelve, illustrating how literal truth can be misleading in context.
Justice Ketanji Brown Jackson, in a second concurring opinion, argued that the jury had already determined Thompson’s statements to be false, suggesting that the appeals court should uphold his conviction based on that finding.