U.S. v. Fernandez, 88-6102

• Decision Date: 05 July 1990
• Docket Number: No. 88-6102,88-6102
• Citation: 905 F.2d 350
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Eddy F. FERNANDEZ, Defendant-Appellant.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 350

905 F.2d 350

UNITED STATES of America, Plaintiff-Appellee, v. Eddy F. FERNANDEZ, Defendant-Appellant.

No. 88-6102.

United States Court of Appeals Eleventh Circuit.

July 5, 1990.

Lauri Waldman Ross, Kelly, Black, Blac, Byrne, Craig & Beasley, P.A., Miami, Fla., for defendant-appellant.

Norman A. Moscowitz, Linda Collins Hertz, Harriett R. Galvin, Asst. U.S. Attys. Miami, Fla., for plaintiff-appellee.

Appeal from the United States District Court for the Southern District of Florida.

Before FAY and COX, Circuit Judges, and GODBOLD, Senior Circuit Judge.

PER CURIAM:

Eddy F. Fernandez was convicted on counts of conspiracy, wire fraud, concealment of material facts and theft involving a program receiving federal funds. Fernandez's criminal activity was associated with the handling of large sums of money distributed from the Health Care Financing Administration (HCFA) to International Medical Centers, Inc. (IMC), a large health maintenance organization (HMO) that employed Fernandez initially as Chief Financial Officer and later as Executive Vice-President for network operations. On appeal he raises five separate issues. As stated by counsel, these are:

I. Whether defendant's renewed Motion for Judgment of Acquittal should have been granted on the basis of insufficient evidence of (1) an April 30 agreement of understanding criminalizing the defendant's acts; (2) communication to the defendant of the existence of any such agreement or understanding.

II. Whether defendant's renewed Motion for Judgment of Acquittal should have been granted on Counts I (conspiracy to defraud) and IV (aiding and abetting wire fraud) where all of the defendant's "overt acts" predated the April 30 "agreement" criminalizing his conduct.

III. Whether defendant's renewed Motion for Judgment of Acquittal should have been granted on Count II (Sec. 666, Sec. 2) where (1) the funds at issue were the property of IMC and thus could not be stolen or misapplied; and (2) were used for legal fees approved for payment in the ordinary course of business.

IV. Whether defendant's renewed Motion for Judgment of Acquittal should have been granted on Count V (Sec. 22, 1001) where the statements made by defendant were (1) either true; or (2) fell within the "exculpatory no" exception to Sec. 1001.

V. Whether the trial court erroneously imposed a pre-guideline sentence on this defendant, where the defendant's indictment, conviction and sentencing all took place after the effective date of the Sentencing Reform Act, and the new guidelines were more favorable than the sentence imposed.

By way of a post-trial Order dated November 21, 1988, the district court dealt with the substance of issues I through IV. A review of the record leads us to the same conclusions as those expressed by the trial judge. Finding no merit in these contentions, we affirm the rulings of the district court for the reasons stated in that Order.

The last issue raised is equally without merit. Congress explicitly provided that the Sentencing Reform Act with its guidelines applies only to offenses committed after its effective date of November 1, 1987. See Sentencing Act of 1987, Pub.L. No. 100-182, Sec. 2(a), 101 Stat. 1266, 1266 (1987) and Note following 18 U.S.C. Sec. 3551; United States v. Burgess, 858 F.2d 1512 1514 (11th Cir.1988). The dates of the indictment, conviction and sentencing are simply irrelevant.

AFFIRMED.

APPENDIX

United States District Court

Southern District of Florida

Case No. 88-77-CR-MARCUS

Filed Nov. 21, 1988

United States of America, Plaintiff,

vs.

Eddy Fernandez, Defendant.

ORDER

THIS CAUSE has come before the Court upon the Motion of Defendant for Judgment of Acquittal or in the Alternative for a New Trial or Arrest of Judgment pursuant to Fed.R.Cr.P. 29(c), 33 and 34; upon Defendant's Supplemental Motion for Judgment of Acquittal, and Defendant's Motion for Release on Bond Pending Appeal. Each of these motions was denied by the Court at the time of Defendant's sentence. We write this opinion in order to detail our reasons for these rulings.

This cause was recently tried to a jury and the Defendant was convicted of four counts--conspiracy to commit wire fraud, theft concerning programs using federal funds and making false statements (18 U.S.C. Sec. 371); aiding and abetting theft concerning programs using federal funds (18 U.S.C. Secs. 2 and 666); aiding and abetting wire fraud (18 U.S.C. Secs. 2 and 1343); and aiding and abetting a cover up (18 U.S.C. Secs. 2 and 1001). The jury was unable to reach a verdict as to Count III. At its core, the Defendant claims that the evidence was simply insufficient to establish that he knowingly and willfully committed the offenses as to which he stands convicted. He also claims that this Court committed error in admitting evidence concerning the Defendant's role in obtaining a $50,000 check to be used for Recarey's bond as to an earlier indictment lodged against Recarey. Finally he claims that the evidence was insufficient to establish an agreement between the Government and IMC.

In ruling on a motion for judgment of acquittal after conviction, the evidence must be considered in a light most favorable to the Government and all inferences must be reasonably drawn in favor of the Government, in order to determine whether there was substantial evidence from which a jury could reasonably find the Defendant's guilt beyond a reasonable doubt. See United States v. Gregory, 730 F.2d 692, 706 (11th Cir.1984), cert. denied, 469 U.S. 1208 [105 S.Ct. 1170, 84 L.Ed.2d 321] (1985). Moreover, a determination whether to grant a new trial because of the insufficiency of the evidence requires the Court to determine whether the verdict was contrary to the weight of the evidence. To warrant a new trial, "[t]he evidence must preponderate heavily against the verdict, such that it would be a miscarriage of justice to let the verdict stand." United States v. Martinez, 763 F.2d 1297, 1313 (11th Cir.1985).

Under either applicable standard, the evidence sufficiently supported the jury findings of guilty. Upon the evidential foundation presented at trial, a jury could find the Defendant's knowing and willful participation in each of the substantive counts charged and the conspiracy to defraud.

Essentially, the crimes alleged in this case revolved around a proposed scheme wherein the Defendant and co-conspirator, Miguel Recarey, conspired to obtain for Recarey's benefit certain Medicare funds contrary to the Government's clear understanding that Recarey would have no access to or benefit of these funds. The evidence established that the Government sent these funds to IMC after having obtained Recarey's agreement to these restrictions, and only after having satisfied itself that appropriate arrangements had been made to safeguard these monies. In contravention of the understanding, the Government charged and sufficiently established that by fraudulent means Recarey and Fernandez obtained some $355,000 of these Medicare funds in order to pay the legal fees of Recarey's criminal defense lawyer.

The evidence overwhelmingly established the Defendant's role and involvement in making the particular arrangements for the transfer of these monies to Recarey's lawyer's bank account. Moreover, notwithstanding the Defendant's assertion to the contrary, there was established substantial evidence from which a jury could infer beyond a reasonable doubt that the Defendant knew and understood fully that Recarey was prohibited from taking or using any of these funds in order to pay his legal fees. Among other things, the evidence established that Fernandez was a close and trusted associate of Mr. Recarey; that Fernandez was intimately involved in Recarey's financial affairs and in the financial affairs of IMC; and that Recarey relied upon Fernandez to assist him with paying expenses related to criminal charges lodged against Recarey on April 27, 1987.

The evidence also established that the Defendant Fernandez knew of IMC's substantial cash flow problems and financial difficulties in April of 1987, and that Fernandez arranged to have the $355,000 payment made surreptitiously and in a manner different from routine procedures normally employed by IMC for the making of such disbursements. Notably, in this case the bills for Recarey's legal fees did not pass through the office of general counsel, and, indeed, the evidence established that Fernandez sought a number of blank checks with which to effect the payments from Jose Gonzalez. Fernandez did not tell Gonzalez what the checks were for. The testimony of Orlando Bichara also amplified the knowledge of Fernandez. Moreover, Fernandez' close involvement in the entire transaction supplied additional evidence as to the irregularity of the transaction. The Defendant, who was also charged as an aider and abettor in carrying out the scheme to defraud, actively participated throughout. This participation included providing instructions to the bank, instructions to Bichara, and having a number of conversations with Mr. Ward. The jury also could infer the criminal intent of Fernandez from a series of statements to John Ward about the incident, some of which were arguably false and exculpatory. In sum, we are satisfied that the evidence was sufficient to permit the jury to find that Fernandez acted knowingly and with criminal intent to obtain...