State v. Fellows

• Decision Date: 23 July 2015
• Docket Number: NUMBER 13–14–00283–CR,NUMBER 13–14–00284–CR,NUMBER 13–14–00285–CR
• Citation: 471 S.W.3d 555
• Parties: The State of Texas, Appellant, v. Christopher Shawn Fellows, Appellee. The State of Texas, Appellant, v. Steve Marston, Appellee. The State of Texas, Appellant, v. Paul Carter, Appellee.
• Court: Texas Court of Appeals

471 S.W.3d 555

The State of Texas, Appellant,

v.Christopher Shawn Fellows, Appellee.

The State of Texas, Appellant,

v.Steve Marston, Appellee.

The State of Texas, Appellant,

v.Paul Carter, Appellee.

NUMBER 13–14–00283–CR

NUMBER 13–14–00284–CR

NUMBER 13–14–00285–CR

Court of Appeals of Texas, Corpus Christi-Edinburg.

Delivered and filed July 23, 2015

Abigail A. Fowler, Joseph P. Corcoran, Assistant Attorneys General, Austin, TX, for Appellant.

Christopher L. Tritico, Tritico Rainey, PLLC, Houston, TX, for Appellee Christopher Shawn Fellows.

Neftali J. Villafranca, Heintz, Villafranca & Villafranca, Victoria, TX, for Appellee Steve Marston.

Brent Dornburg, Victoria, TX, for Appellee Paul Carter.

OPINION

Opinion by Justice Rodriguez

This Court issued a memorandum opinion on June 18, 2015, reversing and remanding the cases for further proceedings. Thereafter, appellees Christopher Shawn Fellows, Steve Marston, and Paul Carter filed motions to publish. We grant the appellees' motions to publish. We withdraw our memorandum opinion and judgments of June 18, 2015, and we substitute the following opinion and judgments in their place.

This case arises from a criminal conspiracy and money-laundering prosecution related to the operation of an alleged illegal gambling establishment in Victoria County, Texas. By one issue, appellant the State of Texas¹challenges the trial court's granting of the motion to dismiss the indictments against appellees because a computer hard drive that was seized by the police in the raid of the establishment was damaged beyond repair while in the State's custody.²We reverse and remand.

I. Background

On February 18, 2009, officers from the Victoria Police Department and United States Secret Service raided the Victoria Internet Café (the Café) pursuant to a warrant issued after a nine-month undercover investigation. According to testimony by officers involved in the investigation, the Café offered its customers access to illegal eight-liner gambling devices. During the raid, law enforcement seized every computer in the Café, including the customer terminals and the point-of-sale terminal, referred to by the parties as “POS1,” that was used by Café employees to transact with patrons. It is undisputed that the hard drive in POS1 was damaged beyond repair while in the State's custody. The State concedes that no usable information can be retrieved from that hard drive.³

In January 2011, in connection with their involvement with the Café, appellees were charged in identical indictments for the offenses of organized criminal activity and money laundering. Count 1 of the indictments alleged that appellees, “with intent to establish, maintain, and participate in a combination and in the profits of a combination, ... commit[ted] the offense[s] of [Gambling Promotion, Keeping a Gambling Place, Possession of a Gambling Device, and Possession of Gambling Paraphernalia].” SeeTex. Penal Code Ann.§ 71.02(a)(2)(West, Westlaw through 2015 R.S.). Count 2 alleged that appellees “knowingly acquire[d], maintain[ed] an interest in, conceal[ed], possess[ed], transfer[red] and transport[ed] ...[;] conduct[ed], supervise[d] or facilitate[d] a transaction involving ...[;] and invest[ed], expend[ed] or receive[d] ... the proceeds of criminal activity.” See id.§ 34.02(a) (West, Westlaw through 2015 R.S.).

In December 2013, appellees filed a motion to dismiss their indictments on the ground that the State's failure to preserve the data from POS1 deprived them of material, exculpatory evidence.⁴Appellees argued that this was a violation of both their due process rights under the United States Constitution and their due course of law rights under the Texas Constitution.⁵SeeU.S. Const.amend. XIV; Tex. Const.art. I, § 19. In support, appellees attached several exhibits, including: (1) orders from Cameron County and Hill County cases in which the courts dismissed charges based on devices like those seized from the Café and concluded that they were not illegal gambling devices; (2) manuals for the Hest Sweepstakes System, the program allegedly housed on POS1 that the Café ran on its terminals; (3) a letter from general counsel of the Texas Alcoholic and Beverage Commission expressing his opinion, in a different case, that the Hest Sweepstakes System was not an illegal gambling program; (4) the affidavit of Nick Farley, an electrical engineer who specializes “in the testing and evaluation of gaming and electronic devices,” including a report by Farley about the workings of the Hest Sweepstakes System; and (5) the affidavit of Vanessa Pena, a Café employee.

In his affidavit, Farley stated that the Hest sweepstakes program's database stored all current and historical information related to every customer, transaction, and “sweepstakes reveal.” Farley stated that the

information that was maintained in the database would have been exculpatory in defending against [the State's] allegations if, for example, the [State's] contention is that there were no entries available without purchase but the Cafe did in fact provide entries without purchase upon request; or that the customers did not know the sweepstakes prizes were not determined by the game terminals if, in fact, customers redeemed the sweepstakes prizes at the point of sale register or redeemed the sweepstakes prize at the game terminals without playing the games.

Farley stated that “[i]t is commonly understood throughout the gaming industry, including regulators, that one of the reasons for maintaining a database of this nature is to guard against allegations such as the ones in this case as well as providing a mechanism by which regulatory or law enforcement agencies can monitor the establishment.” Finally, in the report about the workings of the Hest system attached to Farley's affidavit, Farley concluded that the Flest sweepstakes program was not a “traditional gaming device” in that its “outcome is based upon a finite pool of sweepstakes entries” and “pre-determined” prizes.

Citing the various exhibits and Pena and Farley's affidavits, appellees contended that the lost evidence from POS1 would have shown that the sweepstakes program complied with Texas law and was not an illegal gambling device. SeeTex. Penal Code Ann.§ 47.01(4)(West, Westlaw through 2015 R.S.) (defining as a “gambling device” “any electronic, electromechanical, or mechanical contrivance ... that for a consideration affords the player an opportunity to obtain anything of value, the award of which is determined solely or partially by chance, even though accompanied by some skill, whether or not the prize is automatically paid by the contrivance”). Appellees contended that Café patrons were given entries to the sweepstakes after they bought long-distance phone cards. Appellees contended that patrons were able to reveal their sweepstakes prizes without playing the games, that patrons were not required to buy phone cards to participate in the sweepstakes, and that patrons bought phone cards without participating in the sweepstakes. In sum, appellees argued that the destroyed evidence would have shown that: the program was not an illegal game of chance because the prizes for the game were set and patrons merely “revealed” the prizes after playing the game; there was no consideration involved because patrons could play the game for free; and there was no illegal prize because Texas law allows for cash prizes in sweepstakes.

The State responded that the lost evidence from the database was not material, exculpatory evidence under Brady v. Marylandbut, instead, potentially useful evidence under a later line of cases starting with Arizona v. Youngblood.Under those cases, the State argued, appellees would be required to show that law enforcement acted in bad faith in failing to preserve the evidence.

After a hearing, the trial court granted appellees' motion to dismiss. In its dismissal order, the trial court made the following relevant findings of fact:

1. On or about February 18, 2009, the State of Texas raided the Victoria Internet Café located at 2604 N. Laurent, Victoria, Victoria County, Texas.

2. On or about February 18, 2009, the State of Texas seized and took control of the Victoria Internet Cafe computer system.

3. On or about February 18, 2009, at the time the Victoria Internet Cafe computer system was seized by the State of Texas, the Victoria Internet Cafe computer system was operational for [sic] the State of Texas charged those seated at computers with criminal offenses.

4. The Victoria Internet Cafe computer system has been under the care, custody and/or control of the State of Texas or its agents since its seizure on or about February 18, 2009.

5. One of the items seized by the State of Texas, or its agents, on February 18, 2009 was a Point of Sale computer commonly referred to as POS 1.

6. It is undisputed that on or about February 18, 2009, at the time of the raid of the Victoria Internet Cafe, the Victoria Internet Cafe computer system was operating software developed by Hest Technologies known as Flest Sweepstakes Management System.

7. The Victoria Internet Cafe was operating the Flest Get Connected Sweepstakes Management System as evidenced by the Get Connected cards seized by the State at the time of the raid on or about February 18, 2009....

8. Whether the Victoria Internet Cafe was operating the Flest Get Connected Sweepstakes Management System or the Flest Prepaid Planet Sweepstakes Management System is not an issue in the present matter as Nick Farley testified by way of affidavit that regardless of the system used “the manner and means in which the System generated and stored internal data, commonly referred to as the database, did not change.”

9. The Flest Sweepstakes System database stored all current and historical information relating to each and every customer, all current and historical information relating to each and every sale and all current and historical information relating to each and every sweepstake reveal

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