U.S. v. Bonansinga

• Decision Date: 18 September 1985
• Docket Number: No. 85-1119,85-1119
• Citation: 773 F.2d 166
• Court: U.S. Court of Appeals — Seventh Circuit
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Paul R. BONANSINGA, Defendant-Appellant.

Page 166

773 F.2d 166

UNITED STATES of America, Plaintiff-Appellee, v. Paul R. BONANSINGA, Defendant-Appellant.

No. 85-1119.

United States Court of Appeals,

Seventh Circuit.

Argued June 18, 1985.

Decided Sept. 18, 1985.

Steven J. Rosenberg, Steven J. Rosenberg, Chicago, Ill., for defendant-appellant.

Patrick J. Chesley, Asst. U.S. Atty., Gerald D. Fines, U.S. Atty., Springfield, Ill., for plaintiff-appellee.

Before CUMMINGS, Chief Judge, and BAUER and EASTERBROOK, Circuit Judges.

BAUER, Circuit Judge.

Defendant, Paul Bonansinga, was indicted in a twenty-seven count indictment stemming from alleged abuse of his positions as a member of the City Council of Springfield, Illinois and as the Commissioner of the Department of Public Property, commonly known as City Water, Light & Power (CWLP). Defendant was tried before a jury in the Central District of Illinois, found guilty of Counts 22, 23 and 24, involving mail fraud, 18 U.S.C. Sec. 1341, and acquitted of the other charges. The district judge sentenced defendant to a term of eighteen months imprisonment on Count 22 and suspended the imposition of sentence on the other two counts, ordering that defendant be placed on three years concurrent probation after the end of his parole supervision on Count 22. The district court also imposed a $1,000 fine for each of the three counts and ordered defendant to pay $1,685 in restitution as a special condition of probation. We affirm the conviction on Counts 23 and 24, reverse the conviction on Count 22, and remand for a new sentencing determination.

The three counts that form the basis of defendant's conviction all charged that defendant's accomplices, acting for defendant, took automotive supplies that were provided for the use of CWLP by the Springfield Auto Supply Company (Sasco) and S-M-W Auto Supply (SMW). Count 22 charged that defendant improperly received $985 worth of auto supplies. In July 1981 at defendant's request, James Hankins, who worked for CWLP and was a close friend of defendant, went to Sasco to pick up the supplies, which had been pre-ordered. Hankins signed invoices for these supplies but delivered them to defendant for defendant's own use, rather than to CWLP. The bill for these supplies, which Sasco mailed to CWLP on July 25, 1981, is the mailing alleged in Count 22. The city never paid Sasco for these supplies.

Count 23 charged that Patrick Butler, a long-time friend of defendant who was hired to various supervisory positions at CWLP after defendant's election, picked up supplies at the CWLP garage on several occasions during 1981 and 1982 and delivered them to defendant for defendant's own use. The check to pay for these supplies that CWLP mailed to SMW on December 21, 1981, was the mailing asserted to form the jurisdictional basis for this count.

Count 24 charged defendant with receiving $341.92 worth of auto supplies, picked up from SMW by James Hankins and Denton Meyer, another CWLP employee. The check mailed by the city to pay the four vouchers submitted by SMW for these items is the mailing alleged in this count.

To prove mail fraud, the government must establish: (1) that defendant participated in a scheme to defraud; and (2) that defendant caused the mails to be used in furtherance of the scheme. See United States v. Brooks, 748 F.2d 1199, 1202 (7th Cir.1984); United States v. Brack, 747 F.2d 1142, 1146 n. 3 (7th Cir.1984), cert. denied, --- U.S. ----, 105 S.Ct. 1193, 84 L.Ed.2d 339 (1985). Defendant first argues that the mailings that the government proved do not satisfy part two of the government's required showing.

The mailings in the instant case were between CWLP and the auto supply companies, none of whom were part of defendant's scheme, except to the extent of being victimized by it. However, mailings between innocent parties can support a mail fraud conviction. See United States v. Lindsey, 736 F.2d 433 (7th Cir.1984); United States v. Dick, 744 F.2d 546 (7th Cir.1984); United States v. Wormick, 709 F.2d 454 (7th Cir.1983); United States v. Galloway, 664 F.2d 161 (7th Cir.1981), cert. denied, 456 U.S. 1006, 102 S.Ct. 2296, 73 L.Ed.2d 1300 (1982). "It is not necessary that the scheme contemplate the use of the mails as an essential element." Pereira v. United States, 347 U.S. 1, 8-9, 74 S.Ct. 358, 362-363, 98 L.Ed. 435 (1954). "Where one does an act with knowledge that the use of the mails will follow in the ordinary course of business, or when such use can be reasonably foreseen, even though not actually intended, then he 'causes' the mails to be used." Id. at 8-9, 74 S.Ct. at 362-363. After defendant's friend, Hankins, picked up the supplies from Sasco, he signed the invoices that are charged in Count 22. It was forseeable that the mails would be used to send these invoices to CWLP. Similarly when defendant asked Hankins and Meyer to pick up auto supplies at SMW, it was forseeable that CWLP would use the mails to pay for these items by check as charged in Count 24. Count 23, in contrast, is closer to simple theft than the other counts. The items involved in this count were taken by defendant's accomplices from the CWLP garage, not from the sellers of the goods. The mailing alleged was a check sent after the materials had been delivered to CWLP but before some (but not all) of the goods had been expropriated for defendant. Nonetheless, at the time that they placed their orders at the CWLP garage, defendant's aides knew that the supplies that defendant had requested were going to be used by defendant and not CWLP. There was testimony that many of the items paid for by the check alleged in this count were not ordinarily on hand at CWLP. Therefore, defendant's scheme was the cause of the mailing alleged in this count, and the fact that the supplies were picked up from the CWLP garage rather than directly from SMW is immaterial. It is clear that defendant "caused" all of the mailings alleged in the indictment. The question remains, however, whether these mailings were "in furtherance" of the scheme to defraud.

Mailings between two innocent parties, as alleged in this case, are distinct from those found in the majority of mail fraud cases, which involve a mailing between a defendant (or his accomplices) and the intended victim. The mailings alleged in this case can be distinguished from those cases in which the mailing provided funds for further kickbacks to the defendant, United States v. Primrose, 718 F.2d 1484 (10th Cir.1984), cert. denied, --- U.S. ----, 104 S.Ct. 2352, 80 L.Ed.2d 825 (1984), or the source of the booty for the scheme, United States v. Cavale, 688 F.2d 1098 (7th Cir.1982), cert. denied, 459 U.S. 1018, 103 S.Ct. 380, 74 L.Ed.2d 513; 459 U.S. 1208, 103 S.Ct. 1199, 75 L.Ed.2d 441 (1983); United States v. Stanford, 589 F.2d 285 (7th Cir.1978), cert. denied, 440 U.S. 983, 99 S.Ct. 1794, 60 L.Ed.2d 244 (1979). Nor can it be said that the mailings in this case served to "lull" the auto supply dealers into a false sense of security. See United States v. Sampson, 371 U.S. 75, 78, 83 S.Ct. 173, 174, 9 L.Ed.2d 136 (1962); United States v. Kuna, 760 F.2d 813 (7th Cir.1985). That theory has been applied only to mailings from one of the schemers, and to the extent that SMW received checks from CWLP paying for the merchandise (as charged in counts 23 and 24), there was no need to lull it because it ceased being a victim.

The Supreme Court has considered the sufficiency of mailings between innocent parties under 18 U.S.C. Sec. 1341. In United States v. Maze, 414 U.S. 395, 400-01, 94 S.Ct. 645, 648-49, 38 L.Ed.2d 603 (1974), the mailing, by a defrauded hotel, of invoices for hotel services that respondent had obtained with a stolen credit card was held to be insufficient to support a mail fraud conviction. Similarly, in Parr v. United States, 363 U.S. 370, 80 S.Ct. 1171, 4 L.Ed.2d 1277 (1960), the Court struck down the conviction of members of a school district's Board of Trustees who fraudulently obtained gasoline and other filling station products and services for themselves with the district's credit card. The mailings charged were two invoices mailed by the oil company and, in a separate count, the district's check to the oil company paying one of the invoices. The Court stated, "[t]he scheme in each case had reached fruition when ... the persons intended to receive the [goods and services] had received them irrevocably. It was immaterial to them, or to any consummation of the scheme, how the [oil company] * * * would collect from the [District]. It cannot be said that the mailings in question were for the purpose of executing the scheme as the statute requires." Id. at 393, 80 S.Ct. at 1184 [quotation marks omitted, brackets in the original]. Finally, in Kann v. United States, 323 U.S. 88, 65 S.Ct. 148, 89 L.Ed. 88 (1944), the Court held that the depositing bank's mailing to the drawee bank, of a check obtained through petitioner's fraudulent scheme for diverting funds to a dummy corporation, was insufficient under 18 U.S.C. Sec. 1341.

This court has written that the teaching of Maze and Kann is that mailings "directed to the end of adjusting accounts between victims of a scheme after the scheme has reached fruition cannot support a mail fraud conviction." United States v. Wormick, 709 F.2d 454, 462 (7th Cir.1983). The mailings in the instant case were directed toward adjusting accounts between two victims. Thus, the pertinent question in this case is whether the scheme had reached fruition at the time of the charged mailings. We conclude that it had not.

A mailing will support a conviction even if it follows the defendant's fraudulent acts, United States v. Gorny, 732 F.2d 597, 601-2 (7th Cir.1984); United States v. Galloway, 664 F.2d 161, 164-65 (7th Cir.1981), cert. denied, 456 U.S. 1006, 102 S.Ct. 2296, 73 L.Ed.2d 1300 (1982), or occurs after the schemers have obtained the victim's money or goods, United States v. Sampson, 371 U.S. 75, 80, 83 S.Ct. 173,...