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only credited if the DBE performs a commercially useful function. That is, a contractor

must be responsible for the execution of a meaningful part of a contract. A DBE may

not be added to a project for the sole purpose of meeting DBE participation goals.

Stamatios Kousisis owned Alpha Painting & Construction Co., Inc. (“Alpha”),

which bid for two contracts with the Pennsylvania Department of Transportation

(“PennDOT”) to perform painting work on projects in Philadelphia. One contract
1
involved repainting the Girard Point Bridge, upon which I-95 spans the Schuylkill
River. The other was painting work associated with repairs to 30th Street Station,

Philadelphia’s principal Amtrak station.

Alpha was not a DBE. So, Alpha committed to obtain their paint supplies
from Markias, Inc., a prequalified DBE. With that commitment to Markias, Alpha

was awarded both contracts, which explicitly stated that failure to comply with DBE

regulations would be a material breach.

Alpha and Kousisis were indicted for wire fraud because it turned out that

Markias did not supply paint directly to Alpha, nor did it do any other commercially

useful work on the project. Rather, Alpha ordered paint from other suppliers, but
had those suppliers send an invoice to Markias. Markias added a 2.25% upcharge
and forwarded the pass-through invoices to Alpha. Concealing this arrangement,

Alpha periodically submitted false certifications about Markias’s role in the project to

PennDOT. Notably, however, Alpha completed both projects to PennDOT’s satisfaction.
Nevertheless, the indictment characterized PennDOT as a victim, because petitioners
won the contracts through deceptive “non-financial” inducements, causing PennDOT

harm that “had nothing to do with dollars and cents” but “had to do with its own

program, its own desires.”

In the district court, Kousisis and Alpha were convicted of, among other things,

wire fraud, in violation of 28 U.S.C. § 1343. On appeal, they claimed that the government

failed to prove the property element of wire fraud. That is, the Government failed

1 Another individual and company (Liberty Maintenance, Inc.) was also involved, but they are not relevant to the question
before the Court.

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