U.S. v. Wiley, s. 753

Citation846 F.2d 150
Decision Date06 May 1988
Docket Number754,Nos. 753,755,D,s. 753
Parties25 Fed. R. Evid. Serv. 833 UNITED STATES of America, Appellee, v. Richard WILEY, Elizabeth Wiley Becht, Brian Bink, Ray Gardner, George Keleshian, Edward Larson, Sherrin Larson, Don Mullaney, William Peterson, Karen Radovanovitch, Delmar Reynolds, Donald Rue, Mitchell Shecter, Erna Shecter Wiley, Defendants, Karen Radovanovitch, Delmar Reynolds, Raymond Gardner, Defendants-Appellants. ockets 87-1157, 87-1179, 87-1234.
CourtUnited States Courts of Appeals. United States Court of Appeals (2nd Circuit)

Douglas G. Roberts, Syracuse, N.Y., for defendant-appellant Ray gardner.

G. Robert McAllister, Syracuse, N.Y., filed a brief, for defendant-appellant Karen Radovanovitch.

John R. McDermott, Jr., Syracuse, N.Y., filed a brief, for defendant-appellant Delmar Reynolds.

Thomas E. Booth, Dept. of Justice, Washington, D.C. (Edward R. Broton, Asst. U.S. Atty., Frederick J. Scullin, Jr., U.S. Atty., Northern District of New York, of counsel), for appellee.

Before CARDAMONE and PIERCE, Circuit Judges, and STANTON, District Judge. *

CARDAMONE, Circuit Judge:

Karen Radovanovitch, Delmar Reynolds, and Raymond Gardner appeal their convictions for participating in schemes to defraud would-be independent distributors of home security and energy efficiency devices. This professionally orchestrated "scam" bilked scores of gullible individuals across the country of substantial amounts of money. Only six of the 15 charged with "playing a role" in the scheme were convicted. As is usual following a trial involving a number of codefendants, appellants raise a number of issues on appeal. Only a few require extended discussion.

BACKGROUND

The events leading to the indictment of the three appellants, as well as 12 other defendants (seven of whom entered pleas prior to trial and five of whom proceeded to trial with appellants), centered on plans to attract distributors to sell home energy conservation devices and home security devices. In each case obtaining a distributorship hinged on the interested individual's investing in Advance Technology Systems (ATS) or in Security Control Systems (SCS). This fraudulent enterprise was instigated by Richard Wiley, its admitted mastermind, with the help of Thomas Stone. Together these two defendants formed Suntron, Inc.--the corporate alter ego of ATS and SCS--in early 1981.

Wiley and Stone conducted the ATS and SCS "businesses" along the same lines. Each company advertised for distributors in newspapers across the nation and interviewed applicants by telephone. Those applicants who had a serious interest in becoming distributors travelled to ATS/SCS headquarters in Albany, New York to sign purchase order agreements. These agreements usually obligated the distributor to buy his start-up inventory by paying ATS or SCS approximately $31,000. To attract potential distributors Wiley and Stone made numerous misrepresentations. For example, potential distributors were told that ATS and SCS sold products to their distributors at wholesale prices and that distributors could resell them to retailers. In fact, the price to distributors was the retail price. In addition, Wiley and Stone misrepresented both the history and financial stability of ATS and SCS as well as the two companies' relationships with their suppliers.

Most important for purposes of this appeal, Wiley and Stone represented to potential distributors that other distributors had been successful in selling ATS or SCS products. They hired "references"--including appellant Karen Radovanovitch--who gave false testimonials regarding their own fictitious ATS or SCS distributorships to potential distributors over the telephone and by letter. When in 1982 many distributors complained of difficulty in selling ATS and SCS products, Wiley hired appellants Raymond Gardner and Delmar Reynolds to implement a sales training program that was designed to assist distributors in hiring their own salespeople or "subdistributors." Gardner and Reynolds also worked as bogus telephone references. By March 1983 both ATS and SCS had folded.

The grand jury indictment alleged the existence of two conspiracies--one centering Reynolds was convicted for participation in the ATS conspiracy to commit mail, wire, and travel fraud (Count I) in violation of 18 U.S.C. Sec. 371, for committing wire fraud with regard to ATS (Count III) in violation of 18 U.S.C. Sec. 1343, and for aiding and abetting the SCS wire fraud scheme (Count VII) in violation of 18 U.S.C. Secs. 2(a), 1343. He was sentenced to six months' imprisonment, with sentence suspended, placed on probation for three years, and ordered to pay $2,500 in restitution. Gardner was convicted for aiding and abetting the ATS wire fraud scheme (Count III) in violation of 18 U.S.C. Secs. 2(a), 1343, and the ATS travel fraud scheme (Count IV) in violation of 18 U.S.C. Secs. 2(a), 2314. He was sentenced to concurrent prison terms of one year and one day, with sentence suspended, put on probation for two years, and ordered to pay $2,000 in restitution.

on ATS and the other on SCS--each of which contained four counts. Wiley pled guilty and became the government's principal witness at trial. Following appellants' six-week jury trial in the United States District Court for the Northern District of New York (Munson, Ch.J.), each was convicted and sentenced as follows: Radovanovitch was convicted for participation in both the ATS (Count I) and SCS (Count V) conspiracies to commit mail, wire, and travel fraud in violation of 18 U.S.C. Sec. 371, and for committing wire fraud with regard to ATS (Count III) and SCS (Count VII) in violation of 18 U.S.C. Sec. 1343. She was sentenced to concurrent prison terms of one year and one day, with sentence suspended, placed on probation for three years, and ordered to pay $800 in restitution.

From the entry of these judgments of conviction Radovanovitch, Gardner, and Reynolds appeal. All present a number of arguments for reversing their convictions, most of which are without merit and may be disposed of summarily. Several warrant discussion: Reynolds raises sufficiency and evidentiary claims; Gardner asserts the district court permitted the government improperly broad redirect of Wiley, one of the principals in the fraudulent enterprises; Radovanovitch argues that her case should have been severed. Appellants further contend that the district court erred by failing to grant a mistrial upon learning that the jury had taken the government's exhibit list into the jury room during its deliberations. We consider these arguments in turn.

DISCUSSION
I Reynolds
A. Sufficiency of the Evidence

Reynolds first urges that the evidence at trial was insufficient to prove his guilt on any count beyond a reasonable doubt. The standards for appellate review of an insufficiency challenge place a "very heavy burden" on a defendant. United States v. Rodolitz, 786 F.2d 77, 79 (2d Cir.), cert. denied, --- U.S. ----, 107 S.Ct. 102, 93 L.Ed.2d 52 (1986). "The verdict of a jury must be sustained if there is substantial evidence, taking the view most favorable to the Government, to support it." Glasser v. United States, 315 U.S. 60, 80, 62 S.Ct. 457, 469, 86 L.Ed. 680 (1942). On appeal, a jury verdict must be affirmed if "any rational trier of fact could have found the essential elements of the crime." Jackson v. Virginia, 443 U.S. 307, 319, 99 S.Ct. 2781, 2789, 61 L.Ed.2d 560 (1979).

ATS Conspiracy and ATS Wire Fraud

In order to convict Reynolds for the ATS conspiracy under 18 U.S.C. Sec. 371, the government had to prove that he agreed to and participated in a scheme that he knew had an illegal objective. United States v. Gleason, 616 F.2d 2, 17 (2d Cir.1979), cert. denied, 444 U.S. 1082, 100 S.Ct. 1037, 62 L.Ed.2d 767 (1980). The knowledge aspect of a conspiracy charge requires that a defendant participate in the charged scheme with some knowledge of its unlawful aims and objectives, United States v. Heinemann, 801 F.2d 86, 93 (2d Cir.1986), cert. denied, --- U.S. ----, 107 S.Ct. 1308, 94 L.Ed.2d 163 (1987). The government does not have to prove that the accused knew every objective of the conspiracy, every detail of the scheme's operation There is ample evidence in the record to support the jury's conclusion that Reynolds participated in the ATS conspiracy to defraud potential and actual distributors of home energy conservation devices. See United States v. Bentley, 825 F.2d 1104, 1107 (7th Cir.) (sufficient evidence of knowing participation in a scheme where salesmen told false tales about their background, other customers' successes, and the firm's expertise and standing), cert. denied, --- U.S. ----, 108 S.Ct. 240, 98 L.Ed.2d 198 (1987). Evidence at trial proves that in sales training sessions with two ATS distributors, Hebert and Wolverton, Reynolds misrepresented the "successes" of other ATS distributors and the possibility of profiting from selling ATS products. In addition, he acted as a telephone reference to potential distributors Zawol and Douglass. Reynolds represented to Zawol that he had enjoyed great success selling ATS products and that ATS was a good company run by good people. In fact, Reynolds had never acted as an ATS distributor, and he knew that distributors were charged retail--not wholesale--prices for ATS products. Moreover, as discussed below, he was aware that there was reason to doubt Wiley's integrity.

                or the identity of every coconspirator.   Gleason, 616 F.2d at 16
                

Appellant further contends that there was insufficient evidence to support his conviction for the ATS wire fraud scheme (Count III). We need not tarry over evidence of Reynolds' commission of this crime because a conspiracy member may be held responsible for the substantive offenses committed by his coconspirators, provided that those offenses were reasonably foreseeable consequences of the unlawful agreement. Pinkerton v. United States, 328 U.S. 640, 646-48...

To continue reading

Request your trial
68 cases
  • McCullough v. Filion
    • United States
    • U.S. District Court — Western District of New York
    • March 31, 2005
    ...is a matter entrusted to a trial judge's broad discretion." United States v. Diaz, 176 F.3d at 80 (citing United States v. Wiley, 846 F.2d 150, 156 (2d Cir.1988)). Here, defense counsel aggressively cross-examined Timmons about the inconsistencies in her statements, bringing to light the fa......
  • Matter of Extradition of Marzook
    • United States
    • U.S. District Court — Southern District of New York
    • May 7, 1996
    ...every objective of the conspiracy, every detail of the scheme's operation, or the identity of every coconspirator." United States v. Wiley, 846 F.2d 150, 153-54 (2d Cir.1988). Under the Pinkerton theory of liability, Abu Marzook "can be held responsible for the substantive crimes committed ......
  • U.S. v. Eppolito
    • United States
    • U.S. District Court — Eastern District of New York
    • June 30, 2006
    ...matter entrusted to a trial judge's broad discretion." United States v. Diaz, 176 F.3d 52, 80 (2d Cir.1999) (citing United States v. Wiley, 846 F.2d 150, 156 (2d Cir.1988)). Redirect may be "used to rebut false impressions arising from cross-examination." United States v. Bilzerian, 926 F.2......
  • State v. Harvey
    • United States
    • Connecticut Court of Appeals
    • May 21, 1992
    ... ... See, e.g., United States v. Wiley, 846 F.2d 150, 157 (2d Cir.1988); State v. Asherman, 193 Conn. 695, 736, 478 A.2d 227 (1984), cert. denied, 470 U.S. 1050, 105 S.Ct. 1749, 84 ... State v. Couture, supra, 194 Conn. at 562-63, 482 A.2d 300. Applying the established rules to the case before us, we conclude that the defendant falls short of demonstrating an entitlement to a new trial ... CHARACTERIZATION OF TESTIMONY ... ...
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT