State v. Steffes

• Decision Date: 13 March 2012
• Docket Number: No. 2011AP691–CR.,2011AP691–CR.
• Citation: 812 N.W.2d 529,340 Wis.2d 576,2012 WI App 47
• Parties: STATE of Wisconsin, Plaintiff–Respondent, v. Matthew R. STEFFES, Defendant–Appellant.
• Court: Wisconsin Court of Appeals

340 Wis.2d 576

812 N.W.2d 529

2012 WI App 47

STATE of Wisconsin, Plaintiff–Respondent,

v.Matthew R. STEFFES, Defendant–Appellant.^†

No. 2011AP691–CR.

Court of Appeals of Wisconsin.

Submitted on Briefs Feb. 6, 2012.

Opinion Filed March 13, 2012.

On behalf of the defendant-appellant, the cause was submitted on the briefs of Jeffrey W. Jensen of the Law Offices of Jeffrey W. Jensen, of Milwaukee.

On behalf of the plaintiff-respondent, the cause was submitted on the brief of J.B. Van Hollen, attorney general, and Daniel J. O'Brien, assistant attorney general.

Before CURLEY, P.J., FINE and KESSLER, JJ.

CURLEY, P.J.

[340 Wis.2d 579]¶ 1 Matthew R. Steffes appeals the judgment convicting him of two counts of conspiracy to commit theft by fraud, contrary to Wis. Stat. §§ 939.31, 943.20(1)(d), and 939.62 (2009–10).¹ He also appeals the order denying his postconviction motion. Steffes argues: (1) the evidence was insufficient to convict him of conspiracy to commit theft of property by fraud; (2) the evidence was insufficient to prove that the conspiracy members stole more than $2500 worth of electricity; therefore, the offense was not a felony; (3) he is entitled to resentencing because the trial court relied upon an improper factor in sentencing him; and (4) he should be granted a new trial on the grounds that the real controversy was not tried because the trial court improperly instructed the jury on the elements of the theft by fraud, and defense counsel was ineffective for failing to object. We reject his arguments and affirm.

I. Background.

¶ 2 A jury found Steffes guilty of two counts of conspiracy to commit theft of property exceeding $10,000 in value by fraud. Steffes—an inmate of the Waupun Correctional Institution—along with fellow inmate Joshua Howard, worked with individuals outside of the prison to operate a “burn-out” telephone scam that allowed Steffes to place over 300 calls from prison without paying for them.

¶ 3 At trial, Rheanan Hoffman, Steffes' sister and the mother of Howard's daughter, and Angela Berger, Hoffman's roommate and the mother of Howard's son, explained how the burn-out scam worked. Hoffman and several others—including Steffes' father and two of Steffes' cousins—contacted the phone company to set up a line or lines of service. Unbeknownst to the telephone company, each phone line was in the name of an individual or business other than the person actually setting up the line. Indeed, some of the phone lines used the names of patients at a healthcare clinic where Berger worked. These fraudulent phone lines were called “burn-out” lines because the individuals setting them up had no intention of ever paying for the phone service. They understood that the phone company would eventually shut the line down because the service was not being paid for—in other words, the line would eventually “burn out.” The burn-out lines in this case were set up to avoid the prison's Correctional Billing Service, which monitors inmate collect calls to the outside and limits the minutes and dollar amount that a prisoner can exhaust on any one phone number by blocking service until someone pays the balance due. By allowing access to numerous lines, so that when one was blocked they could easily access another, the burn-out scheme allowed Steffes and Howard to flout Correctional Billing Service's blocking mechanism.

¶ 4 Division of Corrections and Waupun Correctional Institution Investigative Captain

Bruce Muraski explained how the telephone system at Waupun works, how outgoing calls are monitored, and how Corrections Billing Services operates to block the overuse of phone lines. He explained that burn-out phone scams are a cottage industry in prison.

¶ 5 Along with Hoffman's, Berger's, and Muraski's testimony, and the testimony of others involved in the burn-out scam, the State submitted recordings and other documents implicating Steffes. Specifically, the recordings of various calls from the prison, involving both Steffes and other conspirators discussing the burn-out scheme, were played for the jury. For example, in one such call, Steffes gave Hoffman a list of numbers that he suspected would soon be blocked. In another call, Hoffman gave Steffes specific instructions regarding using particular phone numbers, and Steffes asked her to confirm that she would have additional lines “unblocked” for him soon. In yet another call, Steffes instructed another individual regarding how to operate a burn-out line to conduct a three-way call. Additionally, Division of Criminal Investigation Agent Dennis Drazkowski submitted letters written by Howard to Steffes discussing the scheme and instructingSteffes what to do regarding the use of specific burn-out lines.

¶ 6 Steffes benefitted enormously from the scam. From June 1, 2002 until December 31, 2003, he made approximately 322 calls from prison totaling 6,562 minutes on burn-out lines.

¶ 7 The damages too were significant. Robert Lindsley—who managed the group at the phone company that planned, engineered, and installed the electrical system providing power for the equipment used to deliver telephone service to paying customers—testified that the electricity that customers access when using its phone line is worth millions of dollars. Lindsley also explained how use of its telephone network constitutes use of an applied form of electricity. In other words, an electric power network supports the telecommunications network set up by the company. That network supplies electricity to run the telephone network. Thus, when a customer uses the telephone network, he or she is using an applied form of electricity. Additionally, Eric Stevens, an investigator in the phone company's asset protection department, estimated the fair market value to the telephone company of the service fraudulently obtained for each of those lines. Those figures represented the lost fair market value of the service due to non-payment of bills by the co-conspirators, from the date of installation to the date of disconnection of each line. For example, the total amount unpaid for the fictitious “Nick's Heating and Cooling,” “Douyette Advertising Service” and “Douyette Typing Service” that were set up under the Steffes/Howard burn-out scheme exceeded $26,000.

¶ 8 As noted, the jury found Steffes guilty of two counts of conspiracy to commit felony fraud. It found him not guilty of conspiracy to commit identity theft. The trial court sentenced Steffes to fifty-four months' imprisonment, explaining that the sentence derived in part from disregard for the individuals whose identities were stolen:

And somehow you didn't even think, as you said, that once again you are harming other people. Why wouldn't that thought come to you that these identities that are being used must come from somewhere? And as we saw through trial, they were people in elderly residential homes, various other people who had done nothing wrong to you, did not deserve harm, and by your choice, you kept up this pattern of not paying attention to the harm suffered by others.

¶ 9 Steffes subsequently filed a motion for postconviction relief, which the trial court denied. He now appeals.

II. Analysis.

¶ 10 Steffes makes four arguments on appeal: (1) the evidence was insufficient to convict him of conspiracy to commit theft of property by fraud; (2) the evidence was insufficient to prove that the conspiracy members stole more than $2500 worth of electricity; therefore, the offense was not a felony; (3) he is entitled to resentencing because the trial court relied upon an improper factor in sentencing him; and (4) he should be granted a new trial on the grounds that the real controversy was not tried because the trial court improperly instructed the jury on the elements of the theft by fraud, and defense counsel was ineffective for failing to object. We discuss each argument in turn.

(1) There was sufficient evidence for the jury to convict Steffes of conspiracy to commit theft of property by fraud.

¶ 11 Steffes gives two reasons why the evidence was insufficient to convict him of conspiracy. He argues that the State failed to prove that any member of the conspiracy made “a false promise” to pay for services. According to Steffes, there was no evidence that when any of the conspiracy members applied for telephone services, they were asked to declare his or her intention to pay for the services. Thus, because there was no expressly made false promise, the evidence was insufficient to support the conviction. Additionally, Steffes argues that he was not a part of the conspiracy because the crime was already “complete” by the time he got involved. According to Steffes, the crime was already complete because other people—like Howard and Hoffman—fraudulently obtained the burn-out lines; he simply used them once they had been obtained. Therefore, because Steffes only got involved after the crime was complete, his role was more akin to an accessory after the fact or a recipient of stolen property.

¶ 12 When reviewing whether sufficient evidence supports Steffes' conviction, we may not substitute our judgment for the jury's “ ‘unless the evidence, viewed most favorably to the [S]tate and the conviction, is so lacking in probative value and force that no trier of fact, acting reasonably, could have found guilt beyond a reasonable doubt.’ ” See State v. Watkins, 2002 WI 101, ¶ 68, 255 Wis.2d 265, 647 N.W.2d 244 (citation omitted). Under this standard, we may overturn the verdict only if the jury “could not possibly have drawn the appropriate inferences from the evidence adduced at trial to find the requisite guilt.” See id. We may not overturn the verdict even if we believe the jury “ ‘should not have found guilt based on the evidence before it.’ ” See id. (citation omitted).

¶ 13 Steffes was convicted of conspiracy to commit theft of property by fraud, contrary to Wis. Stat. §§ 939.31 (conspiracy); 943.20(1)(d) (theft of property by fraud); and...