132 F.3d 320 (6th Cir. 1997), 95-4095, United States v. Latouf

Docket Nº:Sadie LATOUF (95-4095), Joseph N. Sarich (95-4112), Mario
Citation:132 F.3d 320
Party Name:UNITED STATES of America, Plaintiff-Appellee, v.
Case Date:December 18, 1997
Court:United States Courts of Appeals, Court of Appeals for the Sixth Circuit
 
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132 F.3d 320 (6th Cir. 1997)

UNITED STATES of America, Plaintiff-Appellee,

v.

Sadie LATOUF (95-4095), Joseph N. Sarich (95-4112), Mario

Guerrieri (95-4115), Richard A. Harakal (95-4233),

Defendants-Appellants.

Nos. 95-4095, 95-4112, 95-4115, 95-4233.

United States Court of Appeals, Sixth Circuit

December 18, 1997

Argued (95-4095, 95-4115, 95-4233) April 24, 1997.

Submitted (95-4112) April 24, 1997.

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Nancy A. Vecchiarelli, Asst. U.S. Attorney (argued and briefed), Office of the U.S. Attorney, Cleveland, OH, for United States of America.

Anthony J. Vegh (briefed), Cleveland, OH, David F. Aggers (argued and briefed), Kathryn T. Joseph (briefed), Aggers & Joseph, Beachwood, OH, for Sadie Latouf.

Louis DeFabio, Samuel G. Amendolara (briefed), Youngstown, OH, for Joseph N. Sarich.

Shawn P. Martin (argued), Kevin M. Cafferkey (briefed), Cleveland, OH, for Mario J. Guerrieri.

Christopher R. Fortunato (argued and briefed), Maguire, Schneider, Zapka & Leuchtag, Cleveland, OH, for Richard A. Harakal.

Before: JONES, SUHRHEINRICH, and SILER, Circuit Judges.

JONES, J., delivered the opinion of the court, in which SUHRHEINRICH, J., joined. SILER, J. (pp. 332-333), delivered a separate concurring opinion.

NATHANIEL R. JONES, Circuit Judge.

This case concerns a conspiracy to commit arson in which one defendant, Sadie Latouf ("Latouf"), engaged three other defendants, Joseph Sarich, Mario Guerrieri and Richard Harakal, in a scheme to burn down her restaurant and collect insurance proceeds. The jury convicted all of the Defendants of conspiracy to commit offenses against the United States, arson, and mail fraud. The Defendants now appeal their convictions individually and collectively, challenging federal court jurisdiction, several evidentiary rulings, the evidence and the sentencing. We now affirm.

I.

On October 30, 1992, at 4:01 a.m., Sadie's Casablanca Restaurant exploded by means of a natural gas explosion and burned to the ground. An officer, Patrolman Ludt, had

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been called to the scene just minutes before (3:36 a.m.) because a heat sensor in the restaurant's kitchen had activated and sent out an alarm. At that time, the officer did not discover a fire and confirmed that the building was secure. He did not immediately leave the scene, however, and was only a few hundred yards away when the explosion occurred.

When the fire department arrived part of the building had collapsed, and there was a natural gas fire in another portion of the building. All of the doors were either locked or blown off the building. One wall also collapsed and destroyed a neighboring automobile.

The government began an investigation of this fire suspecting it was arson. In September 1993, the government received word fro Dennis Griffin, one of the arsonists, that he would cooperate. The government obtained information relating to the conspiracy directly from Griffin. Griffin also agreed to be wired and plant himself in the midst of the conspiracy to implicate the other members. As a result of Griffin's cooperation, the government obtained the following facts:

Defendant Sadie Latouf was the owner of Sadie's Casablanca Restaurant. Latouf purchased the restaurant in September 1991 for $270,000. She put $50,000 down, secured a loan for $185,000, and promised the remaining $35,000 to the original owners. Latouf, however, was never able to pay her full monthly payments on the loan. At times she would merely pay the interest, at other times her checks would be returned because she had insufficient funds. In some instances, she simply made no payment at all. Latouf renegotiated the loan with the bank several times. Furthermore, the past owners of the restaurant filed a lawsuit on the outstanding note, which she had not paid at the time of the explosion.

Latouf also owned another restaurant in New Castle, Pennsylvania. Until February 1992, Latouf made regular payments on this restaurant. In August 1992, the bank issued a notice of intention to foreclose her New Castle restaurant and home, after both failed to sell in an auction. During this period in August 1992, Latouf was speaking to one of her dishwashers about trying to pay bills. She offered him and his friend $5,000 to burn down her house. Nothing appears to have occurred as a result of this offer.

Latouf, however, did contract with the other Defendants to burn down Sadie's Casablanca Restaurant. Once the major players had agreed to participate, Defendants Mario J. Guerrieri, Joseph Sarich, and Richard Harakal met with Griffin to discuss the plan. Sarich devised a plan to destroy the building with a natural gas explosion because the building was made of brick, steel, and concrete, which would not burn otherwise.

On the evening of the explosion, Harakal, Sarich, and Griffin went to the restaurant to carry out the plan. Only Latouf was to be at the building when they arrived. When they got to the restaurant, however, several cars were in the parking lot. Thus, Harakal, who knew Latouf, went in alone to have a drink and talk to Latouf.

After Harakal exited the building, the three waited for the last customers to leave. About an hour later, Harakal, Sarich, and Griffin returned to the building and set up the explosion device. They then left the building, and the explosion took place three hours later as planned.

Cigna Insurance Company ("Cigna"), a Pennsylvania-based business, insured the restaurant for $400,000--$300,000 for the building and $100,000 for its contents. In previous years, Latouf had let the policy lapse twice for non-payments of premiums. In October 1992, however, she made two payments. The last payment Latouf made was on October 20, 1992, for $2,017, just ten days prior to the fire. This was the largest payment that she ever made.

On January 6, 1993, Latouf filed a sworn statement with Cigna and claimed that her loss was $408,000 plus loss of income. When she signed the document, Latouf swore that the loss did not occur as a result of an act, design, or procurement on her part. This document was mailed to Cigna's attorneys in Philadelphia, Pennsylvania.

A grand jury investigation ensued. On March 7, 1995, Latouf appeared before the

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grand jury at her own request. The grand jury returned an indictment against Latouf, Guerrieri, Sarich, Harakal, and Griffin on March 8, 1995. The grand jury charged each Defendant in a three-count indictment relating to the destruction of Sadie's Casablanca Mediterranean Restaurant. Count one charged the Defendants with conspiracy to maliciously damage and destroy Sadie's Casablanca Restaurant and to devise and attempt to defraud and obtain money from Cigna through the mail, Count two charged the Defendants with arson and Count three charged each of the Defendants with mail fraud.

On April 6, 1995, the grand jury returned a second indictment against Latouf for perjury. Griffin entered a plea agreement, whereby he pleaded guilty to count one. The district court allowed the two indictments against Latouf to be joined for trial. The jury returned guilty verdicts against all of the Defendants on all counts in the indictment. The district court sentenced Griffin to 23 months imprisonment, Latouf to 70 months, Sarich to 60 months, Guerrieri to 120 months, and Harakal to 57 months. Latouf, Sarich, Guerrieri, and Harakal filed timely notices of appeal.

II.

A.

We first consider the applicability of the federal arson statute to the defendants under the Commerce Clause. 1 All of the Defendants were convicted under the statute, which reads in pertinent part:

Whoever maliciously damages or destroys, or attempts to damage or destroy, by means of fire or an explosive, any building, vehicle, or other real or personal property used in interstate or foreign commerce or in any activity affecting interstate or foreign commerce shall be imprisoned ...

18 U.S.C. § 844(i). Because the "substantially affect interstate commerce" requirement is a jurisdictional element, it must be proven to the jury beyond a reasonable doubt. See United States v. DiSanto, 86 F.3d 1238, 1246 (1st Cir.1996); United States v. Pappadopoulos, 64 F.3d 522, 524 (9th Cir.1995). Thus, for a jury to find the Defendants guilty, the government must prove, among other things, that the property was either "used in" or "used in an activity affecting" interstate commerce. DiSanto, 86 F.3d at 1246-47; 18 U.S.C. § 844(i). Consequently, on review, this court must determine the purpose for which the building was "used." DiSanto, 86 F.3d at 1238.

Congress promulgated § 844(i) to grant the government the broadest possible reach of the federal commerce power. Russell v. United States, 471 U.S. 858, 105 S.Ct. 2455, 85 L.Ed.2d 829 (1985) (unanimous court upholding the conviction for the arson of a two-unit apartment building because local rental is part of a larger commercial market). We recently found this statute to be constitutional because section 844(i) contains a "jurisdictional element, which ensures, through proper inquiry, that the arson in question affects interstate commerce." United States v. Sherlin, 67 F.3d 1208, 1213 (6th Cir.1995) (distinguishing United States v. Lopez, 514 U.S. 549, 115 S.Ct. 1624, 131 L.Ed.2d 626 (1995)).

None of the Defendants contest the constitutionality of the statute, but each contends that sufficient evidence was not presented by the government at trial to establish a sufficient nexus between the restaurant and interstate commerce. At the close of the government's case the Defendants moved for acquittal pursuant to Federal Rule of Criminal Procedure 29. The Defendants argued that...

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