427 F.3d 394 (6th Cir. 2005), 02-3403, United States v. Jamieson

Docket Nº:02-3403, 03-4578.
Citation:427 F.3d 394
Party Name:UNITED STATES of America, Plaintiff-Appellee, v. J. Richard JAMIESON, Defendant-Appellant.
Case Date:October 28, 2005
Court:United States Courts of Appeals, Court of Appeals for the Sixth Circuit
 
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427 F.3d 394 (6th Cir. 2005)

UNITED STATES of America, Plaintiff-Appellee,

v.

J. Richard JAMIESON, Defendant-Appellant.

Nos. 02-3403, 03-4578.

United States Court of Appeals, Sixth Circuit.

October 28, 2005

Argued: March 15, 2005

Appeal from the United States District Court for the Northern District of Ohio at Toledo. No. 02-00707—David A. Katz, District Judge.

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COUNSEL

ARGUED:

Susan Bogart, LAW OFFICES OF SUSAN BOGART, Chicago, Illinois, for Appellant.

Seth Uram, UNITED STATES ATTORNEY, Toledo, Ohio, for Appellee.

ON BRIEF:

Susan Bogart, LAW OFFICES OF SUSAN BOGART, Chicago, Illinois, for Appellant.

Seth Uram, UNITED STATES ATTORNEY, Toledo, Ohio, for Appellee.

Before: DAUGHTREY and CLAY, Circuit Judges; SCHWARZER, District Judge.[*]

OPINION

MARTHA CRAIG DAUGHTREY, Circuit Judge.

The defendant, Richard Jamieson, was convicted of two counts of conspiracy and 155 counts of money laundering, as the result of his ownership and operation of a business that purchased life insurance policies from terminally ill people and resold them to investors. He now appeals his convictions, contending that the evidence was insufficient to support the jury's verdict. He also faults the district court for: failing to recuse itself; restraining his assets and thereby depriving him of representation by counsel of his choice; authorizing insufficient funds for investigation and preparation of his defense; failing to grant a change of venue; permitting introduction of the government's Rule 1006 summaries into evidence; and denying his request for additional jury instructions. Jamieson further alleges that the government was guilty of misconduct in making certain prejudicial statements in closing argument and, finally, he contends that he is entitled to be re-sentenced under United States v. Booker, 543 U.S. ___, 125 S.Ct. 738 (2005). We find no reversible error in connection with the defendant's convictions. The case must be remanded, however, for re-sentencing under Booker.

I. FACTUAL AND PROCEDURAL BACKGROUND

The indictment returned against Jamieson alleged, first, that he had been involved in the purchase and sale of fraudulently obtained life insurance policies and, second, that he had made multiple fraudulent statements to investors for the purpose of inducing them to invest in those insurance policies through his company, Liberte Capital Group, a "viatical settlement company" located in Toledo, Ohio. According to the record, a viatical settlement company buys life insurance policies at a discount from terminally-ill persons, referred to as "viators," and markets the policies ("viaticals") for purchase by investors. Between 1996 and 2000, Liberte Capital purchased at least 950 life insurance policies, 95-99 percent of which insured

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men diagnosed as HIV-positive or with AIDS. Liberte Capital then sold these policies to approximately 2,250 investors for a sum of over $92 million.

The marketing of viaticals is legal, but their purchase carries financial risk to the investor. If a life insurance policy has been fraudulently obtained, the insurance company may rescind the policy and refuse to make any pay-outs, thus rendering the policy, and any investment in the policy, worthless. The record establishes that Jamieson was aware of the risk of investing in fraudulent viatical policies. For example, at a March 1998 meeting with Liberte Capital sales agents, Jamieson explained how viators could fraudulently obtain policies and the need to avoid such policies. As Jamieson explained, an individual with AIDS could answer falsely on insurance applications, indicating that he had no serious illnesses, and thus qualify for the life insurance. He noted that many insurance companies would issue policies with benefits of less than $100,000 without requiring blood tests or medical examinations and that viators often obtained multiple fraudulent policies of this sort.

The government alleges that, during the indictment period, Liberte Capital purchased at least 214 fraudulently-obtained life insurance policies. These 214 policies belonged to a total of 33 viators, each of whom sold at least five different policies to Liberte Capital. Furthermore, in approximately 61 percent of all the viaticals bought by Liberte Capital, the viator's date of HIV-positive or AIDS diagnosis actually preceded the date the policy was issued by the insurance company, thus indicating a high likelihood of fraud in the filing of the application. At trial, four viators explained to the jury how they had fraudulently obtained multiple life insurance policies for themselves and others and sold them to Liberte Capital.

The government presented significant evidence indicating that Jamieson knowingly covered up evidence of this fraud. Several witnesses testified that, after hearing about a government investigation into viatical brokers, Jamieson ordered his employees to remove and destroy the policy applications in every viator's file. The record also reflects that during a hearing in January 2000, Jamieson gave testimony under oath to the Ohio Department of Commerce's Division of Securities that Liberte Capital never reviewed the policies it purchased to determine whether they were fraudulent because (contrary to his earlier description of how viators obtain fraudulent policies) he "was unaware that people were applying for life insurance fraudulently." At the hearing, Jamieson further testified that he never informed investors of the possibility that some policies might be fraudulent and thus subject to rescission by the insurance companies. But beyond merely failing to warn investors of the risk of fraudulent policies, Jamieson specifically marketed Liberte Capital's viatical investments as "a safe purchase" and guaranteed their "security and safety."

The failure to inform investors of the risk of fraudulent policies was not the only misrepresentation Jamieson made. Liberte Capital developed marketing material for use by sales agents in encouraging people to invest in Liberte Capital viaticals. Evidence in the record indicates that Jamieson, as the head of Liberte Capital, wrote or approved all the marketing materials and the investor contracts. At least 75 percent of the investor contracts promised that Liberte Capital would escrow funds sufficient to pay future premiums for twice the remaining life expectancy of each viator. In actuality, however, Liberte Capital escrowed funds according to the promised formula for only 2-5 percent of the life insurance policies. At one point,

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employees of the escrow company noted that the Liberte Capital escrow account was short by $19 million, but Jamieson and the head of the escrow company ordered them to complete the purchases of the policies. Liberte Capital also promised potential investors that none of the policies would be for individuals with life expectancies exceeding five years. In contrast, the government produced evidence showing that 81 policies, involving 751 investors, were for individuals with life expectancies in excess of five years. Finally, and perhaps most importantly, the Liberte Capital sales brochure promised investors that Liberte Capital would use a "totally independent escrow company," Viatical Escrow Services, to assure the safety of their investments. Several sales representatives testified that having an independent escrow service was of paramount importance to their client investors. Viatical Escrow Services was not, however, independent from Liberte Capital. Jamieson had an agreement with James Capwill, the owner of Viatical Escrow Services, that Capwill would invest Jamieson's profits from Liberte Capital and take a cut of the profits. Nevertheless, business relations between Capwill and Jamieson eventually soured, and Jamieson sued Capwill for embezzlement in early 1999.1

In 2002, Jamieson and 16 others were indicted for conspiracy to commit mail fraud. Jamieson was also charged with money laundering and conspiracy to commit money laundering. He pleaded not guilty and later went to trial, but 15 of his co-defendants pleaded guilty, 2 and many eventually testified against Jamieson. Immediately following the indictment, the court granted the government's ex parte motion to freeze all of Jamieson's assets. The restraining order was based on count 158 of the indictment, which charged Jamieson with conspiracy to commit money-laundering offenses involving over $104 million. Jamieson promptly moved to lift or modify the restraining order to enable him to retain counsel of his choice. Following a hearing, the district court denied his motion.

Because Jamieson's assets had been frozen, the trial court appointed two attorneys to represent him under the Criminal Justice Act. The district court also granted Jamieson's motion for CJA funds for investigation, experts, and analysts, but at a lower amount ($100,000) than Jamieson had requested ($500,000).

Jamieson filed numerous other pre-trial motions that were denied by the trial court and are now bases for this appeal. These included a motion for change of venue, another for the district judge to recuse himself, and objections to the government's use of Rule 1006 charts that summarized the data from the records seized from the Liberte Capital office and computers.

Following his conviction, Jamieson was sentenced to 60 months on the charge of conspiracy to commit mail fraud, 240 months on the charges of money-laundering and conspiracy to commit money laundering in counts 2-33, 35-100, and 158, and 120 months on those in counts...

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