United States v. Rucker

• Decision Date: 31 December 2013
• Docket Number: No. 13–1297.,13–1297.
• Citation: 738 F.3d 878
• Parties: UNITED STATES of America, Plaintiff–Appellee, v. Phillip RUCKER, Defendant–Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

738 F.3d 878

UNITED STATES of America, Plaintiff–Appellee,

v.Phillip RUCKER, Defendant–Appellant.

No. 13–1297.

United States Court of Appeals,Seventh Circuit.

Argued Nov. 15, 2013.

Decided Dec. 31, 2013.

John M. Maciejczyk, Attorney, Office of the United States Attorney, South Bend, IN, for Plaintiff-Appellee.

Christopher M. Glinski, Attorney, Racine, WI, for Defendant-Appellant.

Before FLAUM and HAMILTON, Circuit Judges, and KAPALA, District Judge.^*

KAPALA, District Judge.

After a jury found defendant, Phillip Rucker, guilty of one count of wire fraud in violation of 18 U.S.C. § 1343, the district court sentenced him to 30 months' imprisonment, one year of supervised release, and ordered him to pay $73,488.95 in restitution. In this direct criminal appeal, Rucker contends that the district court erred in refusing to allow him to use a prior conviction to impeach a testifying co-defendant. We affirm.

I. Background

The grand jury charged Rucker, Jerry Haymon, and Sheila Chandler, with engaging in a mortgage fraud scheme. Count III of the indictment, the only count in which Rucker was named, alleged the following. With the promise of a $10,000 payment, Rucker recruited Leequiter Smith to purchase residential property at 3758 Buchanan Street in Gary, Indiana for $85,000. Haymon led the owner, Margaret Peterson, to believe that he would sell the property for approximately $35,000. Rucker had Smith sign numerous false documents to support her loan application. Chandler completed a mortgage application for Smith knowing it contained false information. Haymon filed a fake mechanics lien claiming that his business, Priced Right Construction and Management, LLC (“Priced Right”), was owed $44,000 for work performed on 3758 Buchanan. In fact, Priced Right performed no work at the property. The transaction closed on July 14, 2008, and on that date Rucker, Haymon, and Chandler caused $84,118.48 to be transmitted by means of wire transmission in interstate commerce from a lender in Florida to a title company in the Northern District of Indiana. After the closing, Haymon cashed a $44,000 check issued to Priced Right and paid kickbacks to Rucker, Smith, and Chandler for their roles in the scheme.

Prior to trial, the government moved in limine to exclude evidence of Chandler's November 14, 2000 conviction for a theft concerning a program receiving federal funds, in violation of 18 U.S.C. § 666(a)(1)(A), for which she received a sentence of five years' probation. On the first day of trial in December 2011, the district court took up the government's motion in limine and questioned why introducing the stale conviction was necessary since Rucker could impeach Chandler with “the fact that she pled guilty in this case.” The court preliminarily granted the motion and ordered counsel to approach the bench before attempting to use the conviction for impeachment.

During the government's case, Sheila Chandler testified that she had pled guilty to two of the counts of wire fraud charged in the instant indictment, as well as nine counts of wire fraud charged in a previous federal case. Chandler stated that she began working as a loan originator in 1999 or 2000 and worked at various places. In 2004, while she was with Challenge Mortgage, she began to lie to lenders on behalf of buyers and create false documents such as W–2 forms and earnings statements to support loan applications. Chandler met Rucker in 2005 when he was also working at Challenge Mortgage as a loan officer.

Chandler further testified that in 2008, after she left Challenge Mortgage and while she was working for her son's mortgage brokerage company, Rucker called her and said that Haymon wanted to find buyers for a couple of houses that he had because there was a lot of money to be made and that she could make $10,000 per house. In connection with the sale of the house at 3758 Buchanan Street, Rucker provided Chandler with Leequiter Smith's name, address, social security number, and date of birth. After pulling Smith's credit, Chandler believed that she could obtain a loan for her. Chandler forged the seller's signature on a $85,000 purchase agreement and gave it to Rucker to take to Smith for her signature. Chandler indicated on the uniform residential loan application that Smith was going to live in the residence so that she could obtain a FHA loan with a lower down payment and interest rate even though Chandler knew that Smith was planning to rent the residence to another. Chandler explained that Smith did not have money for a down payment. To address this problem, Haymon agreed that he would provide money for the down payment and Rucker disclosed an acquaintance, also named Smith, who he thought would assist them. Chandler created a gift letter, purportedly from Rucker's acquaintance, that provided, “I, Lamar Smith, donor, do hereby certify the following: I have made a gift of $4,000 to Leequiter Smith, whose relationship is sister.” Chandler knew that Lamar Smith was not Leequiter Smith's sibling. Chandler gave the gift letter to Rucker who had both parties sign it and then he returned it to Chandler. Chandler also obtained a copy of the cashier's check that was used for the down payment, which appeared to be funded by Lamar Smith instead of Haymon, and copies of the bank statements of Lamar Smith and Leequiter Smith showing that the gift money was transferred from Lamar Smith's bank account to Leequiter Smith's bank account. All this documentation was provided to the lender. After the closing, Rucker gave Chandler two $5,000 money orders for her participation.

Prior to cross-examining Chandler, defense counsel addressed the court:

[DEFENSE COUNSEL]: First, I'd like to ask permission from the Court to be able to use Ms. Chandler's—Ms. Chandler's 2000 conviction for theft of public funds.

....

THE COURT: Counsel, she just admitted pleading guilty to 11 counts.

[DEFENSE COUNSEL]: And she also—she also admitted, Your Honor, that she's been lying since 2004. I mean, that's—that's only not—she got a sentence of 5 years of probation, convicted in 2000. By 2004, she's right back doing the same sort of thing.

THE COURT: Response?

[DEFENSE COUNSEL]: As far—if I may—I'm sorry. If I may, as far as prejudice to the witness, I don't see how it prejudices her at all. She's already convicted.

[ASSISTANT UNITED STATES ATTORNEY]: Conviction adds absolutely nothing. She's admitted over a long period of time that she's a dishonest person. He can certainly use that to impeach her. She's got 11 convictions. Another conviction that is stale doesn't add anything.

The district court denied the request.

On cross-examination, Chandler agreed that she was “in fact, a liar,” that she had falsified loan documents for Haymon many times, and that they were all stealing money. Chandler said that she gave Rucker a loan package for 3758 Buchanan to take to Smith. Chandler denied speaking to Smith on the telephone about the documents in the loan package. Chandler also agreed that her plea agreement contemplated that the government would move for a downward departure pursuant to U.S.S.G. § 5K1.1 in exchange for her truthful testimony.

After Chandler finished testifying, the district court further explained its ruling regarding her 2000 conviction:

I did not allow you to go into the conviction that was over ten years old because of the age on that, and I was not satisfied that you gave me sufficient reasons. I did not find that the probative value outweighed the prejudicial value on that. I just wanted to make a ruling on that.

Leequiter Smith testified that she met Rucker about six years earlier and they had a four-year on and off romantic relationship. In 2008, Smith was working at Family Dollar in Chicago, Illinois and mentioned to Rucker that she needed additional income. Rucker told her that she could purchase 3758 Buchanan and rent it in order to generate additional income. Rucker also told her that if she bought the house she would get $10,000. Rucker asked Smith for her W–2 forms, check stubs, and bank statement. Rucker also brought Smith papers to sign. Before she bought 3758 Buchanan, Rucker showed her the outside of the home, but she never went inside. Smith was not aware of the price of the home until the day of closing. Because Smith did not have a down payment, Rucker gave her a $4,000 cashier's check from a Lamar Smith, which she deposited into her bank account. Smith later gave Rucker a copy of her bank statement showing the $4,000 deposit. When asked if Rucker provided her with any documentation at the time he brought the $4,000 check, Smith said “he gave me a paper,” which she identified as the gift letter from Lamar Smith. Smith said that she signed the gift letter even though she does not have a brother and did not know anyone named Lamar Smith. According to Smith, Rucker was aware that she was an only child. Smith added that Rucker brought her to the closing in Indiana on July 14, 2008. After the closing, Rucker brought Smith two $5,000 money orders. According to Smith, Rucker was supposed to find a renter for her but he never did. Smith made three payments on the mortgage and then stopped because of her financial difficulties.

On cross-examination, Smith persisted in her testimony that she has never been inside 3758 Buchanan. Smith testified that she did not remember ever meeting Haymon. Smith also testified that she had just one telephone conversation with Chandler to obtain her fax number in order to fax Chandler a bank statement.

A representative of the lender, Taylor, Bean & Whitaker, testified that the funds for the purchase of 3758 Buchanan were transferred from Ocala, Florida, to Indiana Title Company on July 14, 2008. The lender's representative also testified that had the lender known about the falsified documents submitted in support of the loan application, it would have rejected the loan.

According to the Lake County Indiana Assessor's office, the fair...