Ranke v. U.S.
| Decision Date | 28 April 1989 |
| Docket Number | No. 88-1281,88-1281 |
| Citation | 873 F.2d 1033 |
| Parties | Jerry E. RANKE, Petitioner-Appellant, v. UNITED STATES of America, Respondent-Appellee. |
| Court | U.S. Court of Appeals — Seventh Circuit |
Richard F. Walsh, Chicago, Ill., for petitioner-appellant.
Theodore T. Paulas, Asst. U.S. Atty., Chicago, Ill., for respondent-appellee.
Before CUMMINGS and FLAUM, Circuit Judges, and ESCHBACH, Senior Circuit Judge.
On April 30, 1984, Petitioner-Appellant Jerry Ranke entered a plea of nolo contendere to a two-count information that charged him with mail fraud in violation of 18 U.S.C. Sec. 1341. The district court sentenced Ranke to one year and one day in prison on Count One and to a consecutive sentence of four years probation on Count Two. In addition, the court ordered Ranke to make restitution in the amount of $35,000. Ranke is currently serving the period of probation.
After the Supreme Court rendered its decision in McNally v. United States, 483 U.S. 350, 107 S.Ct. 2875, 97 L.Ed.2d 292 (1987), Ranke moved to vacate his conviction and to dismiss the information on the ground that the information was based on an intangible rights theory and failed to charge a deprivation of property. The district court denied the motion and Ranke appealed. This court remanded the case to the district court for reconsideration in light of United States v. Holzer, 840 F.2d 1343 (7th Cir.1988). The district court again denied the motion, and we now reach the merits of Ranke's appeal. We affirm.
Ranke was a Senior Project Manager for Inland Ryerson Building Systems ("Building Systems"), a general contracting company which hired subcontractors to perform building construction work. Ranke's duties included soliciting bids from subcontractors, awarding subcontracts, and overseeing construction projects. Ranke's co-defendant, Nat D'Angelo, was President of Century Concrete Construction Company ("Century"). Century acted as sub-contractor on two of Building Systems' construction projects, the Unarco-Leavitt Tube Mill project and the Roskin Motor Service Warehouse project. The mail fraud charges to which Ranke pled nolo contendere involved a kickback scheme devised and carried out by Ranke and D'Angelo. The scheme entailed raising Century's bid on the Unarco-Leavitt project and issuing extra work orders to Century on both projects, so that Century could make kickback payments to Ranke.
Ranke was originally charged in an indictment that contained eighteen counts of mail fraud. That indictment was dismissed by the district court as being "duplicitous." After a period of plea negotiations, the government filed a superseding two-count information to which Ranke entered his plea. Ranke now challenges the sufficiency of the information.
Ranke claims on appeal that although the original indictment sufficiently alleged a scheme to deprive Building Systems of money or property, the superseding information alleged only a deprivation of intangible rights, i.e., Building Systems' right to the honest services of its employees. 1 In support, Ranke makes three arguments. First, Ranke contends that as a result of the plea negotiations, certain changes in language were adopted in the superseding information which rendered the information insufficient to allege a deprivation of property. Second, Ranke argues that the factual basis for the plea, as shown by the plea agreement and the transcript of the plea hearing, supports only an intangible rights theory of mail fraud. Third, Ranke asserts that the superseding information alleged only a "George-type scheme," referring to United States v. George, 477 F.2d 508 (7th Cir.), cert. denied, 414 U.S. 827, 94 S.Ct. 155, 38 L.Ed.2d 61 (1973), and that that type of scheme does not deprive anyone of property as required by McNally. The thrust of each argument is the same: that the information failed to allege that the secret payments which Ranke received represented money to which Building Systems was entitled. Although Ranke weaves the three arguments together, for the sake of clarity, we will address each argument separately.
By pleading nolo contendere, Ranke waived all defects in the information except lack of subject matter jurisdiction and failure to charge an offense. United States v. Hancock, 604 F.2d 999, 1001 (7th Cir.), cert. denied, 444 U.S. 991, 100 S.Ct. 521, 62 L.Ed.2d 420 (1979); United States v. Bessemer and Lake Erie R.R., 717 F.2d 593, 597-98 (D.C.Cir.1983). Ranke contends that the superseding information failed to charge the offense of mail fraud because it alleged only a deprivation of intangible rights. The charging paragraphs in both the indictment and the superseding information stated as follows: 2
JERRY E. RANKE,
defendant herein, did unlawfully, wilfully and knowingly devise and intend to devise a scheme and artifice to obtain money by means of false and fraudulent pretenses and representations and to defraud Building Systems of the following:
(a) Its right to have the company's business and affairs conducted honestly, impartially, free from deceit, craft, trickery, corruption, fraud, undue influence, dishonesty and conflict of interest;
(b) Its right to the conscientious, loyal, honest, faithful, disinterested and unbiased service, decisions, actions and performance of duties by defendant JERRY E. RANKE in his capacities as Senior Project Manager, free from corruption, partiality, wilful omission, bias, dishonesty, misconduct, conflict of interest and fraud;
(c) Certain secret profits and money obtained by defendant JERRY E. RANKE through the misuse of his employment by Building Systems.
We find, as did the district court, that although subparagraphs (a) and (b) allege the deprivation of intangible rights, subparagraph (c) alleges the deprivation of money. The district court, relying on United States v. Eckhardt, 843 F.2d 989, 997 (7th Cir.), cert. denied, --- U.S. ----, 109 S.Ct. 106, 102 L.Ed.2d 81 (1988), found the charge in subparagraph (c) to be an "easily separable" charge and therefore sufficient to state an offense. We agree. 3
Ranke contends, however, that the factual allegations in the information go to support only the charges in subparagraphs (a) and (b) and not subparagraph (c). He asserts that the following changes in language between the indictment and the information demonstrate that the factual allegations fail to support a charge of property deprivation:
Change 1
Indictment: "It was further a part of the scheme that on or about April 8, 1980, JERRY E. RANKE and NAT D'ANGELO, defendants herein, would and did raise and cause to be raised Century's bid to Building Systems on the Unarco-Leavitt Tube Mill concrete subcontract from $970,000 to $1,160,000 in order to generate funds for a $190,000 kickback payment to JERRY E. RANKE."
Information: "It was further a part of the scheme that on or about April 8, 1980, JERRY E. RANKE and NAT D'ANGELO, defendants herein, would and did raise and cause to be raised Century's bid to Building Systems on the Unarco-Leavitt Tube Mill concrete subcontract from $970,000 to $1,160,000, which later permitted the use of funds for a $190,000 kickback payment to JERRY E. RANKE."
Indictment: "It was a further part of the scheme that JERRY E. RANKE, defendant herein, would and did issue a false and fraudulent extra work order to Century in the amount of $20,840 on the Unarco-Leavitt subcontract to generate funds for a $20,840 kickback payment to JERRY E. RANKE."
Information: "It was a further part of the scheme that JERRY E. RANKE, defendant herein, would and did issue extra work orders to Century on the Unarco-Leavitt subcontract which later generated funds for a $20,840 kickback payment to JERRY E. RANKE."
Same as Change 2, except the dollar amount was $18,939.
Same as Change 2, except the dollar amount was $35,049 and the work order(s) was for the Roskin Motor Service Warehouse subcontract rather than the Unarco-Leavitt subcontract.
Ranke's argument is without merit. As to the first change, we see no meaningful distinction between the words "in order to generate funds for" and the words "which later permitted the use of funds for." 4 As to the other three changes, the deletion of the words "false and fraudulent" is of no consequence. The information clearly alleges that the monies generated by the extra work orders were kicked back to Ranke, 5 and each challenged paragraph alleges that the issuance of extra work orders was "part of the scheme" to defraud Building Systems. 6
Ranke next argues that the factual basis for his plea supports only an intangible rights theory of mail fraud. This argument raises an initial question as to whether a factual basis (other than the facts alleged in the information) need be established on a plea of nolo contendere.
Rule 11(f) of the Federal Rules of Criminal Procedure provides that the district court "should not enter a judgment upon [a plea of guilty] without making such inquiry as shall satisfy it that there is a factual basis for the plea." The rationale for the rule is, in part, to ensure that there is a complete record for appeal that "mak[es] clear exactly what the defendant admits to, and whether the admissions are factually sufficient to constitute the alleged crime." United States v. Fountain, 777 F.2d 351, 355 (7th Cir.1985), cert. denied, 475 U.S. 1029, 106 S.Ct. 1232, 89 L.Ed.2d 341 (1986). The rule, by its terms, however, does not apply to pleas of nolo contendere. The rationale for not requiring a factual basis to be established for a plea of nolo contendere is that the plea "may be accepted from a defendant who is wholly innocent but who does not wish to contest the charge." 1 C. Wright, Federal Practice and Procedure Sec. 174 at 614 (2d ed. 1982) [hereinafter Wright]; see also North Carolina v. Alford, 400 U.S. 25, 35-36 n. 8, 91 S.Ct. 160, 166-67 n. 8, 27 L.Ed.2d 162 (1970). Despite...
To continue reading
Request your trial
-
US v. Johns
...fraud conviction."), and the Seventh Circuit has approved a modified version of the loss of control theory, see Ranke v. United States, 873 F.2d 1033, 1039 (7th Cir.1989), I am, nonetheless, bound by the mandates of the Third I conclude that the right to know material information, like the ......
-
U.S. v. Briscoe
...also deprived the Union of the opportunity to negotiate a more favorable economic position with Sir Finance. See Ranke v. United States, 873 F.2d 1033, 1037-40 (7th Cir.1989). The Union had a right to know the entirety of the terms by which it was doing business with Sir Finance and, on the......
-
Borre v. U.S.
...under mail fraud statute even though it was "brimming with the buzz-words of the intangible rights doctrine")- ; cf. Ranke v. United States, 873 F.2d 1033 (7th Cir.1989) (plea of nolo contendere). As outlined in Eckhardt and Ranke, we look first to the indictment to determine whether any of......
-
State v. Albright
...trial courts to inquire as to the evidence supporting a criminal charge before accepting a nolo contendere plea. Ranke v. United States, 873 F.2d 1033, 1037 (7th Cir. 1989) ; see also Crowe, 168 S.W.3d at 747 n.18 (noting that Tennessee Rule of Criminal Procedure 11 does not prohibit a tria......
-
How the pretrial process contributes to wrongful convictions.
...find a factual basis for a no contest plea, see supra note 168, some judges probably demand one regardless. Cf. Ranke v. United States, 873 F.2d 1033, 1037 (7th Cir. 1989) (finding that although courts not required to find a factual basis for a nolo plea, the better practice is for judges t......