UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT
UNITED STATES OF AMERICA,
BRIEF FOR APPELLANT
STATUTES AND RULES
Pursuant to Fed. R. App. P. 28(f) and Circuit Rule 28(a)(5), pertinent statutes and rules are set forth in the Addendum hereto.
The District Court had jurisdiction under 18 U.S.C. § 3231. The notice of appeal having been timely filed, this Court has jurisdiction pursuant to 28 U.S.C. § 1291.
1. Whether the evidence was legally insufficient to prove that Mr. xxxxxx was guilty of bank fraud as that offense was charged to the jury.
2. Whether the judge committed reversible error by instructing the jury (a) that the evidence established that Mr. xxxxxx acted with intent to defraud, which was an element of both charges, (b) that the money at issue in the bank fraud count only had to be controlled (not owned) by the bank, and (c) that, in addition to explicit misrepresentations, "false pretenses" would satisfy the bank fraud charge.
3. Whether the judge committed reversible error by overruling Mr. xxxxxx's objections to a Government witness' testimony (a) that interstate commerce was affected by Mr. xxxxxx's acts and (b) that the Riggs Bank had determined that bank fraud had been committed by means of unauthorized use of the ATM card.
STATEMENT OF THE CASE
In a two-count indictment filed on August 26, 1992, appellant Richard Anthony xxxxxx was charged with bank fraud, 18 U.S.C. § 1344(1), and with access device fraud, 18 U.S.C. § 1029(a)(2). His trial by jury began on February 9, 1992 and ended on February 11, 1992, when the jury found him guilty of both counts. He moved unsuccessfully for judgments of acquittal on both charges at the end of the Government's case, at the close of all the evidence, and, in writing, after the verdict. On May 25, 1993, Mr. xxxxxx was sentenced to six months' imprisonment on each count (execution of both sentences suspended), to three years' probation, and to $100 in special assessments. Mr. xxxxxx's notice of appeal was filed on June 1, 1993.
Mr. xxxxxx was previously represented on appeal by other counsel, who filed a brief on his behalf and then was permitted to withdraw from representing Mr. xxxxxx, at which time the brief was stricken (Order filed October 27, 1994). The Federal Public Defender was subsequently appointed (Order filed December 9, 1994).
The Evidence at Trial
Mr. xxxxxx was hired as an administrative aide to then District of Columbia Councilwoman xxxxxxxx xxxxx in February, 1991 (Tr. 126, 147). (1) Ms. xxxxx testified that during his employment with her, which lasted until his resignation on February 21, 1992, his duties included driving her and her relatives on business and personal errands, assisting other staff members on public housing issues, and occasionally cashing personal checks for her (Tr. 128, 130, 147-154, 161-163, 197). Ms. xxxxx acknowledged that she would write the checks to Mr. xxxxxx, noting on each check that it was "personal for W. [or W.J.] xxxxx," and Mr. xxxxxx would bring her the cash (Tr. 130, 158-160). The last of such checks was written and cashed in December, 1991 (Tr. 156).
In April of 1991, Ms. xxxxx had gone to Riggs Bank and applied for a new automatic teller machine ("ATM") card because she had misplaced her old one (Tr. 169-170). She chose a four-digit personal identification number ("PIN") and entered it privately into a key pad, telling no one what it was--"it was supposed to be a secret" (Tr. 173-174). She believed that she was told at the bank not to write it down, and she did not recall that she did write it down (Tr. 174-175). She later reported to the bank that she had not written it down, but had memorized it (Tr. 181-182). She no longer remembered her PIN, but she speculated that she had used the last four numbers of her car or home telephone (Tr. 183-184).
Ms. xxxxx claimed that she had never used the new ATM card herself, that she had never told anyone her PIN, that she had kept the card in a place--either in a desk drawer at work or in a crystal bowl in her dining room at home--to which Mr. xxxxxx had access, and that she had never let Mr. xxxxxx use her card to get cash from the bank for her (Tr. 120, 131-132, 175, 184-189).
In March of 1992, Ms. xxxxx said, she noticed in her last two Riggs Bank statements that there were a number of cash withdrawals from ATM machines that she had not made (Tr. 119-121). The first such withdrawal was dated "1/27" (Tr. 157). She reported the discrepancy to the vice-president of her bank (Tr. 120-121). Later, at the bank, she identified photographs of Mr. xxxxxx at various ATM machines (Tr. 123-124). She contended that the ATM card "had to have been stolen" (Tr. 181).
Ms. xxxxx acknowledged that Mr. xxxxxx had become a rival candidate for her Council seat after leaving her staff (Tr. 140-143). She also acknowledged the existence of a District personnel regulation prohibiting public officials from ordering public employees to perform personal services, but she denied that her use of Mr. xxxxxx's services had violated that regulation (Tr. 167-169).
Lyle J. Theisen, who had just retired from his position as a security officer at Riggs Bank, was the Government's other witness (Tr. 29). He testified that the bank discouraged customers from choosing PIN's based on easily discovered numbers, such as telephone and Social Security numbers, birth dates, and anniversaries (Tr. 32). He also testified how ATM transactions take place, including the fact that transactions initiated with Riggs ATM cards at other banks or at any banks outside the District are communicated through a "switching center" in the Midwest (TR. 35-39). During this testimony, the following transpired:
Q. [The Prosecutor]: Now, you have indicated that when the ATM transaction goes through this process that the transaction itself affects interstate commerce. Is that correct?
A. Oh, yes.
MR. COBURN [Defense Counsel]: Objection. That's a legal conclusion.
THE COURT: Overruled.
MS. EVANS [The Prosecutor]: Thank you.
(Tr. 39) The prosecutor reminded the witness of this testimony later, and he was permitted to explain it, which he did by hypothesizing a Riggs ATM card withdrawal from California, where Riggs has no branches, which he said "would certainly be considered interstate" (Tr. 41-42).
Mr. Theisen went on to testify about his investigation of Ms. xxxxx's complaint in March, 1992 (Tr. 42-43). He said he determined that the total cash withdrawn with Ms. xxxxx's ATM card was over $11,000, and he obtained copies of photographs of the person making several of the transactions, whom Ms. xxxxx identified as Mr. xxxxxx (Tr. 44-45). (The defense stipulated to the accuracy of all the photographs introduced, as well as the date, time, and location information concerning them; several transactions were made at out-of-state banks or other banks in the District (Tr. 63-64).) There were 54 ATM transactions, 41 of which resulted in cash withdrawals totaling $11,100 (Tr. 69-71). (2) The first withdrawal was on January 26, 1992 and the last on March 2, 1992 (Tr. 73).
At the end of Mr. Theisen's direct testimony, the following took place:
Q. You have indicated that $11,100 was taken out of Mrs. xxxxx's account using her ATM card?
Q. And was that the amount of loss that Riggs suffered in relation to those transactions?
MR. COBURN: Objection. Leading.
THE COURT: Objection overruled.
A. Yes. That's how we get involved in security, when the bank sustains a loss, and we have to investigate it to protect the bank's interest and that's the amount of money that we repaid, that we put back into Mrs. xxxxx's account because of the -- what was determined as bank fraud through the unauthorized use of her ATM card --
MR. COBURN: Objection, motion to strike that whole line of testimony.
THE COURT: Objection overruled.
THE WITNESS: -- which we are required by law.
Following the argument and denial of the motion for a judgment of acquittal (Tr. 200-205), the defense presented its case. Most pertinent here is the testimony of Mr. Theisen, who was recalled. Ms. xxxxx had testified that she had never called Mr. xxxxxx a "confidential" assistant, for "[c]confidential is a very special type word" (Tr. 186). Mr. Theisen, however, testified, as he had before the Grand Jury, that Ms. xxxxx had described Mr. xxxxxx as a "[c]onfidential driver/assistant," and she had said that he was a "very trusted employee of hers" (Tr. 231-232). Also, as noted above, the witness testified that only one transaction of the 54 had been initiated by an incorrect PIN, and that it had taken place on February 2, 1992, which was a week after the first transaction (Tr. 236-237).
The Colloquy Concerning the Evidence and the Instructions
At the close of all the evidence, defense counsel renewed his motion for a judgment of acquittal on both counts of the indictment, and the judge denied it without comment (Tr. 239).
The colloquy then turned to the jury instructions, and the judge suggested to the prosecutor that banking technology had opened a "loophole" in the bank fraud statute, § 1344, which the access device statute, § 1029, was designed to close (Tr. 243). The judge agreed that the cases cited by defense counsel stood for the proposition that under the bank fraud statute, "someone has to make some false representation to the bank" (Tr. 243). (3) To the prosecutor's assertion that it is a false representation to put another person's card and punch her number into an ATM machine knowing that she has not authorized the transaction, the judge said, "Maybe that's not so" (Tr. 244). He went on to suggest that there would be no need for § 1029(a)(2) if the prosecutor were right, and that that statute seemed to be "designed to deal with just what we have, just what you say you have here" (Tr. 245).
The prosecutor suggested that Mr. xxxxxx's repeated transactions were sufficient evidence of fraud against the bank under §1344(1) because the "monies and funds" were "under its control," and that the bank would not have paid the funds out if it had known the situation (Tr. 245-246). Defense counsel referred to United States v. Bonallo, 858 F.2d 1427 (9th Cir. 1988), and United States v. Briggs, 920 F.2d 287 (5th Cir. 1991), and argued that the "crux" of federal fraud is a false representation, that "plain stealing," without "lying," is not fraud, and that Mr. xxxxxx's actions with respect to the card and the ATM machine conveyed no "factual information" (Tr. 247-248).
After the judge reiterated his skepticism about the applicability of § 1344(1) to situations where § 1029 applies, the prosecutor repeated that the test should be whether the bank would have paid the money if it had known the presenter's lack of authority, and she maintained that when a person inserts an ATM card into a machine and punches in the number, implicitly "they are representing that that is their card and they have authority to use that card" (Tr. 249-250).
Further, similar colloquy ensued, and then the prosecutor acknowledged that she had originally requested bank fraud instructions in the language of § 1344(2) and now proffered "corrected" instructions as to § 1344(1) that were used in pattern jury instructions (Tr. 253-254). The judge reserved decision until the following day (Tr. 254).
The next morning, the prosecutor brought to the judge's attention a case that is unidentified in the record, the only one she could find dealing with a credit card device, but the judge found the case unpersuasive because it did not deal with the legislative history of § 1029, which, he said, was "a so-called credit card fraud statute" intended to "overrule" the Supreme Court's decision in United States v. Williams, 458 U.S. 279 (1982), and "to pick up the loopholes" (Tr. 258-259).
At one point, the judge declared, "I don't think that 1344 applies" (Tr. 259). After more discussion, defense counsel "formally" renewed his motion for a judgment of acquittal "based on the requirement [of § 1344] that there be a false representation" (Tr. 260). The judge responded, "With tongue in cheek I deny it at this time" (Tr. 261).
Defense counsel argued in closing that there was a reasonable doubt that Mr. xxxxxx could have obtained Ms. xxxxx's PIN without her telling him, particularly in light of the fact that only one incorrect PIN had been entered, and that was after the transactions began (S. Tr. 18-19), that Ms. xxxxx had reason not to admit that she had given Mr. xxxxxx her ATM card to use for her personal purposes (Tr. 19-20), that the ATM withdrawals had only started after the checks for cash had stopped (Tr. 20-21), that Mr. xxxxxx had become Ms. xxxxx's political rival (Tr. 21), that Mr. xxxxxx must have known that he would be photographed at the ATM machines (Tr. 22), and that the Government had not proved that Mr. xxxxxx's use of the ATM card was "unauthorized," which is statutorily defined as "lost, stolen, expired, revoked, canceled or obtained with intent to defraud" (Tr. 23-24).
The Jury Instructions
The instructions on the bank fraud count began as follows:
The bank fraud count, the Government must sustain [its] burden of proof for a crime of knowingly executing a scheme to obtain monies or funds or other property owned by or under the control of the financial institution he is charged with in Count One. The Government must prove certain elements. First, [it] must prove that defendant xxxxxx knowingly executed a scheme to obtain the money owned by or under control of the financial institution by means of false or fraudulent pretenses, representations, or promises; secondly, that the defendant did so with intent to defraud . . . .
(S. Tr. 41; emphasis added) The emphasized words and phrases all are found only in subsection (2) of § 1344, not in subsection (1). The ensuing instructions explicitly referred to those terms, explaining that the representations or false or fraudulent pretenses required would be "untrue" "material" "statement[s]" or "assertions[s]," or "half truths," or knowingly concealed facts (S. Tr. 41-42).
In initially defining "intent to defraud," the judge declared, The evidence in the case did not establish that any person was actually defrauded but only that the accused acted with intent to defraud.
(S. Tr. 42) The judge went on to tell the jury that it was sufficient if they determined that Mr. xxxxxx intended to defraud "anybody," but in response to defense counsel's later exception to that instruction, the judge instructed that "his intent must be directed toward the institution which had control or custody of the funds" (S. Tr. 42, 47, 49).
Defense counsel also protested that under § 1344(1) the money would have to be owned, not merely controlled, by the bank, and that an explicit misrepresentation would have to be made, rather than a mere "false pretense" (S. Tr. 45-46). The judge rejected the former proposition, but he indicated that he had only added the language about false pretenses because the prosecutor had requested it, and that he agreed with defense counsel:
I told you I didn't agree with that but I think that on that issue if your client is convicted and made an issue on appeal I believe what you say is true. I don't think the man is charged with the bank fraud statute but I don't want to -- and if I dismiss the charges and he were found guilty of the other statute I don't know whether he would preserve them to appeal or not. I don't think it is proper.(S. Tr. 46-47) No additional exception was taken to the instructions concerning the second count, access device fraud, which likewise included the element of intent to defraud (S. Tr. 44-45).
The jury deliberated from 12:45 p.m. to 3:50 p.m., at which time they found Mr. xxxxxx guilty of both counts (Tr. 261-262).
SUMMARY OF ARGUMENT
Mr. xxxxxx argues first that the evidence of bank fraud under Count One was legally insufficient. The judge instructed the jury that bank fraud required proof, inter alia, of misrepresentations. Although Mr. xxxxxx was charged only under 18 U.S.C. § 1344(1), which on its face does not require misrepresentations, the judge's instructions made the requirement of representations the law of the case. Mere use of an ATM card and PIN, which is analogous to opening a lock, is not a representation, so it cannot be a misrepresentation. Therefore, the evidence was insufficient to support a finding, beyond a reasonable doubt, that Mr. xxxxxx committed all the elements of bank fraud under the law of the case.
Second, Mr. xxxxxx challenges three instructions given by the judge. The first effectively directed a partial verdict on the element of intent to defraud, violating settled constitutional law. The second and third, which were objected to, erroneously lightened the Government's factual burden as to the elements of both offenses.
Finally, Mr. xxxxxx challenges the admission, over objection, of legal conclusion
testimony as to elements of both offenses.
THE EVIDENCE WAS LEGALLY INSUFFICIENT TO PROVE THAT MR. xxxxxx WAS GUILTY OF BANK FRAUD AS THAT OFFENSE WAS CHARGED TO THE JURY.
Standard of Review
The Court reviews de novo a defendant's challenge to the sufficiency of the evidence, considering the evidence in the light most favorable to the prosecution and determining whether any rational trier of fact could have found the elements of the crimes charged to have been proved beyond a reasonable doubt. United States v. Sean M. Fennell, No. 93-3064, slip op. at 3 (D.C. Cir. May 5, 1995), and cases cited therein.
The Law of the Case, as Established by the Judge's Instructions
A jury instruction that increases the Government's burden and is not protested by the Government becomes the law of the case, and the appellate court must determine whether the Government's evidence was legally sufficient to carry that increased burden. United States v. Jokel, 969 F.2d 132, 136 (5th Cir. 1992); accord Trevino v. Dahm, 2 F.3d 829, 835-836 (8th Cir. 1993) (Heaney, Sr. Cir. Judge, Dissenting); United States v. Gomes, 969 F.2d 1290, 1294 (1st Cir. 1992)(evidence insufficient to establish elements under law of the case); United States v. Fontana, 948 F.2d 796, 800-801 (1st Cir. 1991); United States v. Taylor, 933 F.2d 307, 310 (5th Cir. 1991); United States v. Cronic, 900 F.2d 1511, 1515-1517 (10th Cir. 1990)(Government acquiesced in instructions requiring misrepresentations, none proved). Moreover, because a defendant has constitutional rights to notice of the charges and an opportunity to address them at trial, as well as the right to trial by jury rather than by an appellate tribunal, a criminal conviction cannot be affirmed based on a legal theory other than that presented to the jury. Ortiz v. DuBois, 19 F.3d 708, 716 (1st Cir. 1994); see United States v. Schwartz, 924 F.2d 410, 418 (2d Cir. 1991).
Here, the record is not entirely clear as to whether the Government ultimately meant to ask for bank fraud instructions requiring misrepresentations, but the prosecutor at least failed to object to the instructions that were ultimately given, and the prosecutor argued to the judge and to the jury that Mr. xxxxxx did make misrepresentations and try to deceive Riggs Bank when he used Ms. xxxxx's ATM card (Tr. 243-244, 249-250; S. Tr. 11-12, 29). Thus, this Court must determine whether the evidence was legally sufficient to prove--as the trial judge explicitly instructed the jury the evidence had to prove (S. Tr. 41-42)--that Mr. xxxxxx's uses of the ATM card constituted misrepresentations. (4)
The Insufficiency of the Evidence to Prove Misrepresentations
An ATM card and the PIN pertaining to it are analogous to the combination of, or the key to, a lock protecting valuable property. All three access devices work no matter who uses them. The repository of the valuable property--here, the bank's computerized machinery--is incapable of discriminating between device users who follow correct access procedures. Accordingly, mere correct use of an ATM and a PIN cannot constitute a misrepresentation, and the bank cannot be deceived by such use. No evidence in the Government's case below can overcome this logic, and it follows that the evidence was insufficient to support Mr. xxxxxx's bank fraud conviction.
This conclusion is indisputably supported by case law considering the elements of the second subsection of the bank statute, which explicitly requires "false or fraudulent pretenses, representations, or promises." (5)
While we have found no decisions considering the applicability of § 1344(2) to ATM transactions, (6) the provision has been in issue in certain factual contexts similar to the instant one. Most prominently, in United States v. Briggs, 939 F.2d 222, 226-227 (5th Cir. 1991) (which replaced the earlier opinion in the same case, 920 F.2d 287), the Fifth Circuit held that a wire transfer order in itself is not any kind of a representation, let alone a misrepresentation.
Briggs was based on the Fifth Circuit's prior decision in United States v. Medeles, 916 F.2d 195, 202 (5th Cir. 1990), where it had held that depositing checks backed by insufficient funds did not satisfy the representational element of then § 1344(a)(2) (now 1344(2)). And Medeles was based on United States v. Williams, 458 U.S. 279, 284-285 (1982), where the Supreme Court held that a check makes no representation as to the state of the drawer's bank balance. See also United States v. Cronic, 900 F.2d 1511, 1516 (10th Cir. 1990)("a bare check kiting scheme, unembellished by other acts or communications, does not violate the false or fraudulent pretenses, representations, or promises clause of the mail fraud statute [18 U.S.C. § 1341].").
Williams and Briggs apparently gave the judge below serious
doubts that the bank fraud statute was applicable to Mr. xxxxxx's alleged conduct (see Tr. 247-248, 258-261; S. Tr. 46-47). The
judge even said he was denying Mr. xxxxxx's motion for a judgment of acquittal on Count
One "with tongue in cheek" (Tr. 261). Nevertheless, he decided to pass on to
this Court the task of determining that Mr. xxxxxx's conviction on that count cannot stand
(S. Tr. 46-47). This Court must make that determination, reversing the conviction and
ordering the entry of a judgment of acquittal.
THE JUDGE COMMITTED REVERSIBLE ERROR BY INSTRUCTING THE JURY (A) THAT THE EVIDENCE
ESTABLISHED THAT MR. xxxxxx ACTED WITH INTENT TO DEFRAUD, WHICH WAS AN ELEMENT OF BOTH
CHARGES, (B) THAT THE MONEY AT ISSUE IN THE BANK FRAUD COUNT ONLY HAD TO BE CONTROLLED
(NOT OWNED) BY THE BANK, AND (C) THAT, IN ADDITION TO EXPLICIT MISREPRESEN-TATIONS,
"FALSE PRETENSES" WOULD SATISFY THE BANK FRAUD CHARGE.
Standard of Review
The standard of review as to the initial, constitutional error asserted herein, which was not objected to, is the plain error standard, which requires consideration of whether the error was unwaived, whether it was "obvious" under current law, and whether it was prejudicial. United States v. Olano, 113 S.Ct. 1770, 1777-1778 (1993); United States v. Washington, 12 F.3d 1128 (D.C. Cir. 1994). The other instructions challenged, which were objected to below, are reviewed de novo. United States v. Edelin, 996 F.2d 1238 (D.C. Cir. 1993).
A. The Plainly Erroneous Instruction That Mr. xxxxxx Acted With Intent to Defraud
A criminal defendant's Sixth Amendment right to a jury trial means that a trial judge may not direct a guilty verdict, "regardless of how overwhelmingly the evidence may point in that direction." Connecticut v. Johnson, 460 U.S. 73, 84 (1983), quoting United States v. Martin Linen Supply Co., 430 U.S. 564, 572-573 (1977); see Rose v. Clark, 478 U.S. 570, 578 (1986). Accordingly, the defendant has "an absolute right to a jury determination on all the essential elements of the offense." United States v. England, 347 F.2d 425, 430 (7th Cir. 1965); accord Leach v. Kolb, 911 F.2d 1249, 1255 (7th Cir. 1990); United States v. Dakota Cheese, Inc., 906 F.2d 335, 338 (8th Cir. 1990); United States v. Saenz, 747 F.2d 930, 944 (5th Cir. 1984), cert. denied, 473 U.S. 906 (1985)("To direct a verdict in whole or in part is plain error."); United States v. Hayward, 420 F.2d 142, 144 (D.C. Cir. 1969)("The rule that a directed verdict of guilty is invalid is enforced no matter how conclusive the evidence may be.").
In the instant case, where intent to defraud was an element of the two charges (7) against Mr. xxxxxx, the judge instructed the jury: The evidence in the case did not establish that any person was actually defrauded but only that the accused acted with intent to defraud.
(S. Tr. 42) This may not have been what the judge intended to say or what counsel
expected to hear, but its facial meaning was necessarily clear to the jury--Mr. xxxxxx had
committed a crucial element of both bank fraud and access device fraud. The error was
plain and presumptively prejudicial, and it certainly cannot be held harmless beyond a
reasonable doubt. United States v. Hayward,
supra, 420 F.2d at 145.
B. The Erroneous Refusal to Instruct That the Objective of the Charged Bank Fraud Must Be the Bank's Money
In United States v. Blackmon, 839 F.2d 900, 905-906 n. 5 (2d Cir. 1988), where the Second Circuit held that the bank must be the "victim" under both subsections of § 1344, it recognized that the District Court had read subsection (1) to require that the bank itself, as an owner of property, rather than as a custodian, be the victim. This reading arises from the obvious absence from subsection (1) of the language of custody and control included in subsection (2).
Counsel's objection here to the court's instruction that the money sought would merely have to be in the bank's custody and control (S. Tr. 41, 45-46), therefore, was well taken. That instruction would have been correct only if § 1344(2) had been the offense charged. This error necessarily prejudiced the jury's consideration of the bank fraud count.
C. The Erroneous Inclusion of False Pretenses as an Element of the Charged Bank Fraud
When defense counsel objected to the inclusion of false pretenses as an alternative to the misrepresentation element in the instructions on § 1344(1), the judge indicated that he agreed with counsel that such language, and indeed the whole statute, was inapplicable to Mr. xxxxxx's conduct, but that he was preserving the parties' appellate options (S. Tr. 46-47). This course was misguided. Mr. xxxxxx was entitled by his attorney's objection to have the jury deliberate on instructions that were legally correct. Like the custody and control language, the false pretenses element --which ostensibly would require less definitive conduct by Mr. xxxxxx than misrepresentation--was conspicuously absent from § 1344(1). Apparently the judge thought that Mr. xxxxxx might be acquitted of bank fraud regardless of the instructions, or he contemplated a post-verdict judgment of acquittal on that count. In any event, it was improper for him to tailor the charge to either party's appellate interests. This error, too, requires reversal of the bank fraud conviction.
THE JUDGE COMMITTED REVERSIBLE ERROR BY OVERRULING MR. xxxxxx'S OBJECTIONS TO A GOVERNMENT WITNESS' TESTIMONY (A) THAT INTERSTATE COMMERCE WAS AFFECTED BY MR. xxxxxx'S ACTS AND (B) THAT THE RIGGS BANK HAD DETERMINED THAT BANK FRAUD HAD BEEN COMMITTED BY MEANS OF UNAUTHORIZED USE OF THE ATM CARD.
Standard of Review
Generally, preserved issues regarding the admissibility of evidence are reviewed for abuse of judicial discretion. United States v. Clarke, 24 F.3d 257, 267 (D.C. Cir. 1994).
The Erroneous Admission of Testimony as to
Legal Conclusions Establishing Elements of Access device Fraud
This Court recognized, in Christianson v. National Savings and Trust Co., 683 F.2d 520, 529 (D.C. Cir. 1982), that it was settled law that judges alone may instruct juries on legal conclusions, and that "lay legal conclusions are inadmissible in evidence." Fed. R. Evid. 704(a), which provides that "testimony in the form of an opinion or inference otherwise admissible is not objectionable because it embraces an ultimate issue to be decided by the trier of fact," did not end the prohibition of legal conclusion testimony. Hygh v. Jacobs, 961 F.2d 359, 363-364 (2d Cir. 1992); Shahid v. City of Detroit, 889 F.2d 1543, 1547-1548 (6th Cir. 1989); Specht v. Jensen, 853 F.2d 805, 810 (10th Cir. 1988)("In no instance can a witness be permitted to define the law of the case."); Torres v. County of Oakland, 758 F.2d 147, 150-151 (6th Cir. 1985)(surveying cases); Owen v. Kerr-McGee Corp., 698 F.2d 236, 239-240 (5th Cir. 1983); United States v. Baskes, 649 F.2d 471, 479 (7th Cir. 1980), cert. denied 450 U.S. 1000 (1981)(held that trial court could properly conclude that legal conclusion testimony was not "otherwise admissible").
In the instant case, over defense counsel's objections, Mr. Theisen, the bank security officer, was allowed to testify explicitly to two legal conclusions: (1) that the ATM transactions "affect[ed] interstate commerce" (8); and (2) that Riggs Bank had determined that "bank fraud" had been committed by the "unauthorized use" of Ms. xxxxx's ATM card. Of course, bank fraud, § 1344(1), was the crime charged in Count One, and affecting interstate commerce and unauthorized use of an access device were elements of access device fraud, § 1029(a)(2), the crime charged in Count Two.
In Torres, supra, the Sixth Circuit concluded, based on its survey of the case law, that witnesses should not be questioned in ways that elicit answers couched in legal terms of art. 758 F.2d at 151. There can be no debate that "affects interstate commerce," "bank fraud," and "unauthorized," referring to use of an ATM card, are all terms of art in §§ 1344 and 1029. It follows inevitably that the testimony was erroneously admitted, and, because it went to the heart of the allegations against Mr. xxxxxx, that it was prejudicial. Both convictions must be reversed.
For the reasons stated in Point I, the conviction must be reversed and the entry of a judgment of acquittal ordered; for the reasons stated in Points II and III, the convictions must be reversed and a new trial ordered.
A. J. KRAMER
FEDERAL PUBLIC DEFENDER
Allen E. Burns
Assistant Federal Public Defender
625 Indiana Avenue, N.W. Suite 550
Washington, D.C. 20004
CERTIFICATE AS TO LENGTH OF BRIEF
I HEREBY CERTIFY that the foregoing brief contains no more than the number of words allowed by Circuit Rule 28(d).
Allen E. Burns
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on May 17, 1995 , two copies of the foregoing brief for defendant-appellant and one copy of the accompanying appendix were served by United States Mail, first-class postage paid, upon the United States Attorney's Office, Att'n: A.U.S.A. John R. Fisher, 555 Fourth Street, N.W., Room 10-435, Washington, D.C. 20001.
Allen E. Burns
TaBLE OF AUTHORITIES
*Christianson v. National Savings and Trust Co.,
683 F.2d 520 (D.C. Cir. 1982) . . . . . . . . . . . . . . 20
*Connecticut v. Johnson,
460 U.S. 73 (1983) 17
*Hygh v. Jacobs,
961 F.2d 359 (2d Cir. 1992) . . . . . . . . . . . . . . . 21
*Leach v. Kolb,
911 F.2d 1249 (7th Cir.),
cert. denied, 498 U.S. 972 (1990) 18
*Ortiz v. DuBois,
19 F.3d 708 (1st Cir. 1994),
cert. denied, 115 S. Ct. 739 (1995) 14
Owen v. Kerr-McGee Corp.,
698 F.2d 236 (5th Cir. 1983) . . . . . . . . . . . . . . . 21
Rose v. Clark,
478 U.S. 570 (1986) 17
*Shahid v. City of Detroit,
889 F.2d 1543 (6th Cir. 1989) . . . . . . . . . . . . . . 21
*Specht v. Jensen,
853 F.2d 805 (10th Cir. 1988) . . . . . . . . . . . . . . 21
*Trevino v. Dahm,
2 F.3d 829 (8th Cir. 1993) 13
*Torres v. County of Oakland,
758 F.2d 147 (6th Cir. 1985) . . . . . . . . . . . . . . . 21
United States v. Baskes,
649 F.2d 471, 479 (7th Cir. 1980),
cert. denied 450 U.S. 1000 (1981) . . . . . . . . . . . . 21
United States v. Blackmon,
839 F.2d 900 (2d Cir. 1988) 19
United States v. Bonallo,
858 F.2d 1427 (9th Cir. 1988) 8, 15
*United States v. Briggs,
920 F.2d 287, rehearing granted,
opinion withdrawn, new opinion substituted,
939 F.2d 222 (5th Cir. 1991) 7, 8, 16
United States v. Clarke,
24 F.3d 257 (D.C. Cir. 1994) . . . . . . . . . . . . . . . 20
*United States v. Cronic,
900 F.2d 1511 (10th Cir. 1990) 13, 16
*United States v. Dakota Cheese, Inc.,
906 F.2d 335 (8th Cir. 1990),
cert. denied, 498 U.S. 1083 (1991) 18
United States v. Edelin,
996 F.2d 1238 (D.C. Cir. 1993) . . . . . . . . . . . . . . 17
*United States v. England,
347 F.2d 425 (7th Cir. 1965) 17
United States v. Sean M. Fennell,
No. 93-3064 (D.C. Cir. May 5, 1995) . . . . . . . . . . . 13
United States v. Fontana,
948 F.2d 796 (1st Cir. 1991) 13
*United States v. Gomes,
969 F.2d 1290 (1st Cir. 1992) 13
*United States v. Hayward,
420 F.2d 142 (D.C. Cir. 1969) 18
*United States v. Jokel,
969 F.2d 132 (5th Cir. 1992) 13
United States v. Martin Linen Supply Co.,
430 U.S. 564 (1977) 17
*United States v. Medeles,
916 F.2d 195 (5th Cir. 1991) 7, 16
United States v. Olano,
113 S.Ct. 1770 (1993) . . . . . . . . . . . . . . . . . . 17
United States v. Orr,
932 F.2d 330 (4th Cir. 1991) 7
*United States v. Saenz,
747 F.2d 930 (5th Cir. 1984),
cert. denied, 473 U.S. 906 (1985) 18
United States v. Sayan,
968 F.2d 55 (D.C. Cir. 1992) 14
United States v. Schwartz,
924 F.2d 410 (2d Cir. 1991) 14
United States v. Taylor,
933 F.2d 307 (5th Cir. 1991) 13
United States v. Washington,
12 F.3d 1128 (D.C. Cir. 1994) . . . . . . . . . . . . . . 17
*United States v. Williams,
458 U.S. 279 (1982) 16
18 U.S.C. § 1029(a)(2) PASSIM
18 U.S.C. § 1344 PASSIM
FED. R. EVID. 704(a) . . . . . . . . . . . . . . . . . . . . 20
*Asterisks denote authorities chiefly relied upon.
TABLE OF CONTENTS
TABLE OF AUTHORITIES . . . . . . . . . . . . . . . . . . . . . . i
STATUTES AND RULES . . . . . . . . . . . . . . . . . . . . . . . 1
JURISDICTION . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ISSUES PRESENTED . . . . . . . . . . . . . . . . . . . . . . . . 1
STATEMENT OF THE CASE . . . . . . . . . . . . . . . . . . . . . 2
Procedural Background . . . . . . . . . . . . . . . . . . . 2
The Evidence at Trial . . . . . . . . . . . . . . . . . . . 3
The Colloquy Concerning the Evidence and Instructions . . . 7
The Jury Instructions . . . . . . . . . . . . . . . . . . 10
SUMMARY OF ARGUMENT
POINT I: THE EVIDENCE WAS LEGALLY INSUFFICIENT TO PROVE THAT MR. xxxxxx WAS GUILTY OF BANK FRAUD AS THAT OFFENSE WAS CHARGED TO THE JURY. . . . . . . . . . . . . . . . . 13
POINT II: THE JUDGE COMMITTED REVERSIBLE ERROR BY INSTRUCTING THE JURY (A) THAT THE EVIDENCE ESTABLISHED THAT MR. xxxxxx ACTED WITH INTENT TO DEFRAUD, WHICH WAS AN ELEMENT OF BOTH CHARGES, (B) THAT THE MONEY AT ISSUE IN THE BANK FRAUD COUNT ONLY HAD TO BE CONTROLLED (NOT OWNED) BY THE BANK, AND (C) THAT, IN ADDITION TO EXPLICIT MISREPRESENTATIONS, "FALSE PRETENSES" WOULD SATISFY THE BANK FRAUD CHARGE. . . . . . . . . . . . . . . . . . . . 17
POINT III: THE JUDGE COMMITTED REVERSIBLE ERROR BY OVERRULING MR. xxxxxx'S OBJECTIONS TO A GOVERNMENT WITNESS' TESTIMONY (A) THAT INTERSTATE COMMERCE WAS AFFECTED BY MR. xxxxxx'S ACTS AND (B) THAT THE RIGGS BANK HAD DETERMINED THAT BANK FRAUD HAD BEEN COMMITTED BY MEANS OF UNAUTHORIZED USE OF THE ATM CARD. . . . . . . . 20
CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . 22
CERTIFICATE AS TO LENGTH OF BRIEF . . . . . . . . . . . . . . . 23
CERTIFICATE OF SERVICE . . . . . . . . . . . . . . . . . . . . 23
CERTIFICATE AS TO PARTIES, RULINGS, AND RELATED CASES
Pursuant to Circuit Rule 28(a)(1), appellant, Richard Anthony xxxxxx, states as follows:
A. Parties and Amici
The parties on this appeal are appellant, Richard Anthony xxxxxx, and appellee, the United States of America ("the Government"). There are no intervenors or amici.
B. Rulings Under Review
Mr. xxxxxx was convicted after a jury trial, the Hon. William B. Bryant, United States District Judge, presiding. The rulings appealed from are the judge's denial of Mr. xxxxxx's renewed motion for a judgment of acquittal (Tr. 239; Appendix Tab A); the judge's admission of legal conclusion testimony (Tr. 39, 74; Appendix Tab A); and three jury instructions (S. Tr. 41-42; Appendix Tab B).
C. Related Cases
There are no related cases, and this case has not previously been reviewed by any court.
1. Trial transcript page citations are designated by "Tr." Page citations in the subsequently transcribed transcript of closing arguments and jury instructions are designated by "S. Tr." Page citations to the Appendix for Appellant are designated by "A."
2. Riggs' "normal policy" was to permit withdrawals of no more than $300 in any 24-hour period (Tr. 33). Mr. Theisen was recalled by the defense, and he testified that of the 54 transactions, only one, on February 2, 1992, had been initiated by the entry of an incorrect PIN (Tr. 236-237).
3. Counsel relied on United States v. Briggs, 920 F.2d 287, rehearing granted, opinion withdrawn, new opinion substituted, 939 F.2d 222 (5th Cir. 1991), United States v. Medeles, 916 F.2d 195 (5th Cir. 1991), and United States v. Orr, 932 F.2d 330 (4th Cir. 1991).
4. Defense counsel contended below, and we would submit on appeal, that even though § 1344(1) contains no reference to misrepresentations, a fraud charge inherently requires them. The Court in United States v. Sayan, 968 F.2d 55, 61 n.7 (D.C. Cir. 1992), recognized that other courts have reached a contrary conclusion, but in any event, it is clear here that as a result of the jury instructions, misrepresentations effectively became an element of the bank fraud count.
5. 18 U.S.C. § 1344. Bank fraud
Whoever knowingly executes, or attempts to execute a scheme or artifice--
(1) to defraud a financial institution; or
(2) to obtain any of the moneys, funds, credits, assets, securities, or other property owned by, or under the custody or control of, a financial institution, by means of false or fraudulent pretenses, representations, or promises; shall be fined not more than $1,000,000 or imprisoned not more than 30 years, or both.
6. In United States v. Bonallo, 858 F.2d 1427, 1432 (9th Cir. 1988), the court held that the defendant had only been convicted under § 1344(a)(1), the predecessor of the present § 1344(1), and therefore that the defendant's claim of insufficient proof of false pretenses was beside the point. Interestingly, the court went on to recognize a fraud charge's inherent requirement of a misrepre-sentation, and held that it had been met. Id. at 1433-1434.
7. The text of § 1344 is set forth in footnote 5 above. In pertinent part, § 1029 (a)(2) reads,
(a) Whoever . . . (2) knowingly and with intent to defraud . . . uses one or more unauthorized access devices during any one-year period, and by such conduct obtains anything of value aggregating $1,000 or more during that period; . . . shall, if the offense affects interstate commerce, be punished as provided in subsection (c) of this section. . . . (e) As used in this section . . . (3) the term "unauthorized access device" means any access device that is lost, stolen, expired, revoked, canceled, or obtained with intent to defraud;
8. These words were in the prosecutor's leading question, to which the witness answered, "Oh, yes" (Tr. 39).