Cliff Berry, Inc. v. State

• Citation: 116 So.3d 394
• Decision Date: 16 July 2013
• Docket Number: 3D09–473.,Nos. 3D09–389,s. 3D09–389
• Parties: CLIFF BERRY, INC., and Jeffrey Clint Smith, Appellants, v. The STATE of Florida, Appellee.
• Court: Court of Appeal of Florida (US)

116 So.3d 394

CLIFF BERRY, INC., and Jeffrey Clint Smith, Appellants,

v.The STATE of Florida, Appellee.

Nos. 3D09–389, 3D09–473.

District Court of Appeal of Florida, Third District.

Jan. 4, 2012.

Rehearing Denied July 16, 2013.

Akerman Senterfitt and Jonathan Goodman and Brian James, for appellant Cliff Berry, Inc.

Carlton Fields and Michael S. Pasano and Marissel Descalzo, Miami, for appellant Jeffrey Clint Smith.

Pamela Jo Bondi, Attorney General, and Rolando A. Soler, Assistant Attorney General, for appellee.

Before SUAREZ,^*ROTHENBERG,^* and LAGOA, JJ.

LAGOA, J.

Cliff Berry, Inc. (“CBI”) and Jeffrey Clint Smith (“Smith”) (collectively “Defendants”) were each convicted by a jury and adjudicated guilty of two counts of first-degree grand theft. In this consolidated appeal of the convictions, the Defendants claim that the trial court erred in refusing to give certain requested jury instructions and in failing to conduct a timely and adequate Richardson¹ hearing. We reverseand remand the matter for a new trial.

I. FACTUAL AND PROCEDURAL HISTORY

Defendant CBI is a provider of environmental services including the removal of waste water to and its subsequent processing at CBI's treatment facility in Miami. Defendant Smith was CBI's project manager assigned to oversee the performance of two contracts between CBI and Aircraft Service International Group (“ASIG”), the operator of the fuel storage facility located at the Miami International Airport (the “Fuel Farm”).² Both contracts obligated CBI to remove and dispose of certain waste streams, notably, petroleum contaminated water (“PCW”), generated at the Airport and stored at the Fuel Farm.

Under the first contract, effective from May 1, 2000 through September 30, 2001, CBI agreed to remove “PCW” from the Fuel Farm. Under the second contract, effective from October 1, 2001 through July 1, 2004, CBI agreed to remove “PCW from holding tank,” as well as contaminated and uncontaminated jet fuel stored at the Fuel Farm. Although the two contracts contemplated the removal of PCW (and jet fuel, under the second contract) by CBI from May 1, 2000 to July 1, 2004, CBI was temporarily replaced by another vendor, Petrotech, in early 2002. CBI resumed its obligations under the second contract in June 2002. Although neither contract specifies, CBI, ASIG, and the County agreed that when CBI removed PCW under either contract, CBI was to receive payment. In contrast, when CBI removed contaminated or uncontaminated jet fuel, CBI, ASIG, and the County agreed CBI was obligated to pay for the volume of fuel removed. Neither contract defined “petroleum contaminated water” or “PCW.”

The criminal charges filed below involved the Defendants' removal services and billing practices under the PCW disposal contracts. The State's theory was that the Defendants submitted fraudulent invoices for the removal of PCW (which resulted in overbilling) and stole contaminated and uncontaminated jet fuel from the Fuel Farm (primarily from Tank 21, the PCW tank). The State's key witness was Brian Schneir, the maintenance supervisor at the Fuel Farm. Schneir was prosecuted separately for conspiring with other vendors to steal fuel from the Fuel Farm, and testified against Smith and CBI pursuant to a plea agreement with the State.

At trial, Schneir claimed that CBI stole fuel from the Fuel Farm 35 to 42 times from early 2000 to March 2003. Schneir contended that these thefts were from inbound fuel lines (10 to 12 times, 7,500 gallons each time, for a total of 75,000 to 90,000 gallons), from outbound fuel lines (10 to 12 times, 7,500 gallons each time, for a total of 75,000 to 90,000 gallons), during tank cleanings (5 to 6 times, between 10,000 and 50,000 gallons each time, for a total of 50,000 to 300,000 gallons), and from Tank 21 (10 to 12 times, 7,500 gallons each time, for a total of 75,000 to 90,000 gallons). In sum, Schneir estimated that CBI stole between 275,000 and 570,000 gallons of jet fuel from the Fuel Farm (for which he claimed to receive a kickback in the amount of 30 cents per gallon).³

Schneir also testified that, beginning in June or July of 2002, CBI billed ASIG for services it did not render by creating fake trucking manifests (which Schneir approved) for the removal of PCW from the Fuel Farm. According to Schneir, the number of fake manifests CBI fraudulently invoiced each month varied from two or three to seven or eight per month, in Schneir's discretion. Each fake manifest was for removal of 7,500 gallons of PCW. Thus, in a nine-month period, Schneir estimated that CBI fraudulently invoiced between 135,000 and 540,000 gallons of PCW (for which he claimed to receive a kickback in the amount of 3 cents per gallon).

Schneir's trial testimony was a drastic departure from his pre-trial sworn statement and deposition, given in May and June 2008, respectively. In his pre-trial testimony, Schneir claimed that CBI began stealing jet fuel from the Fuel Farm and submitting fraudulent invoices for the removal of PCW when CBI resumed its obligations under the second contract in June 2002. According to Schneir, CBI stole jet fuel from various places at the Fuel Farm, including Tank 21, ten to twelve times (maximum) between June 2002 and March 2003. CBI's truck carried 7,500 gallons at a time; thus, the total amount of fuel Schneir contended CBI took from the Fuel Farm was 75,000 to 90,000 gallons. Thus, Schneir's trial testimony increased the duration of the crime by two and a half years, and the extent of the crime by 25 to 40 thefts and 200,000 to 480,000 gallons.

With respect to CBI's removal of PCW, Schneir contended that, on average, CBI fraudulently invoiced three fake manifests per month; CBI never submitted more than five fake manifests in a month and, sometimes, no fake manifests were included in CBI's monthly bill. Each fake manifest was for 7,500 gallons of PCW. Thus, according to Schneir's pre-trial testimony, in a given month, CBI may have fraudulently billed for the removal of zero to 37,500 gallons of PCW. Based on Schneir's trial testimony, in a given month, CBI may have fraudulently billed for the removal of 15,000 to 60,000 gallons of PCW. Schneir's trial testimony increased the extent of CBI's fraudulent invoicing by 15,000 to 22,500 gallons.

Although Schneir spent “hours and hours and hours and hours” preparing for trial with prosecutors and/or investigators, and despite the fact that the State was aware that Schneir's trial testimony would vary significantly from his pre-trial testimony before Schneir took the stand,⁴ the State did not indicate to the defense that Schneir would depart from his pre-trial testimony until after Schneir began testifying.⁵

At trial, the Defendants argued that they relied in good faith on the PCW disposal contracts, which failed to distinguish between PCW and contaminated and uncontaminated jet fuel, and therefore, they lacked the requisite intent for criminal liability.

The evidence at trial indicated that PCW and contaminated jet fuel can both be characterized as mixtures of fuel and water. Notably, the second contract defined contaminated jet fuel as “any fuel that is not virgin, i.e., fuel that has been used in flushing ops, tank bottoms sumped by CBI due to cloudiness, water contaminated and unfit for use by ASIG.” However, neither contract defined PCW, and the evidence at trial indicated that the term “PCW” was susceptible to a number of meanings, including “water contaminated and unfit for use by ASIG”—in other words, contaminated jet fuel. Thus, at least under the second contract, one meaning of the term “PCW” was synonymous with contaminated jet fuel. The contracts simply failed to distinguish or explain the difference between PCW (water containing fuel) and contaminated fuel (fuel containing water).

The State considered the failure of the contracts to distinguish between PCW and contaminated jet fuel insignificant based on the physical properties of the substances. Patricia Nichols, the County employee that supervised the Fuel Farm, testified that because fuel is lighter than water, the contents of Tank 21 tended to separate over time such that a cross-section of the tank would reveal an upper layer of un contaminated jet fuel, a middle layer of contaminated jet fuel, and a bottom layer of PCW. Thus, Ms. Nichols testified, CBI was entitled to be paid only when it removed the PCW at the bottom of Tank 21; if CBI removed the fuel floating in the middle or upper layers of the tank, CBI was obligated to purchase it from the County.⁶

However, the contracts' failure to define or distinguish PCW from uncontaminated jet fuel provided the basis for the Defendants' theory of defense. It was undisputed that Tank 21 was used for PCW; according to the Defendants, because all PCW is a mixture of fuel and water, the entire contents of Tank 21 was PCW regardless of the precise fuel-to-water ratio and regardless of whether its contents separated (because the mixture was frequently agitated by the removal and addition of fluids). According to CBI employees, an average PCW mixture contained ten to twenty percent fuel, but fuel-water mixtures that contained anywhere from thirty to ninety percent fuel still qualified as PCW. Likewise, because the entire contents of Tank 21 were contaminated with water, nothing in Tank 21 qualified as uncontaminated or pure jet fuel. Thus, under the contracts, fluids could legitimately be taken from the top, middle, or bottom of Tank 21 and subsequently invoiced for payment as PCW.

The Defendants offered the testimony of Mitch Oceguera, CBI's truck driver assigned to the Airport contracts, in support of their theory. Oceguera testified that his general practice was to pick up “whatever was in Tank 21.” Oceguera believed that everything in Tank 21 was PCW, regardless of its precise fuel-water percentage, and never believed or had reason to suspect that his conduct, i.e., picking up waste from Tank 21, was...