U.S. v. Floyd

• Decision Date: 10 August 1989
• Docket Number: No. 89-1019,89-1019
• Citation: 882 F.2d 235
• Parties: 132 L.R.R.M. (BNA) 2175, 112 Lab.Cas. P 11,408 UNITED STATES of America, Plaintiff-Appellee, v. William A. FLOYD, Defendant-Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 235

882 F.2d 235

132 L.R.R.M. (BNA) 2175, 112 Lab.Cas. P 11,408

UNITED STATES of America, Plaintiff-Appellee, v. William A. FLOYD, Defendant-Appellant.

No. 89-1019.

United States Court of Appeals, Seventh Circuit.

Argued May 25, 1989.

Decided Aug. 10, 1989.

Mitchell A. Mars, Asst. U.S. Atty., Dept. of Justice, Chicago Strike Force, Chicago, Ill., and Frank J. Marine, Dept. of Justice, Civ. Div., Appellate Staff, Washington, D.C., for the U.S., plaintiff-appellee.

Dan K. Webb, John M. O'Malley, and Bernard J. Bobber, Winston & Strawn, Chicago, Ill., for William Floyd, defendant-appellant.

Before WOOD, Jr., COFFEY, and FLAUM, Circuit Judges.

HARLINGTON WOOD, JR., Circuit Judge.

William A. Floyd appeals from his convictions of embezzling union property in violation of 29 U.S.C. Sec. 501(c) and of conspiring to embezzle union property in violation of 18 U.S.C. Sec. 371. He also contests the district court's denial of his motion to dismiss the indictment due to prejudice on the basis of preindictment delay. We affirm.

I. FACTUAL BACKGROUND

William A. Floyd ("Floyd") admits the following facts. In 1984, Floyd served as both a business representative and trustee of Teamster Local 705 ("Local 705"). At the time, Louis Peick ("Peick") served as Secretary-Treasurer (the chief officer) of Local 705, a position he had held consecutively since 1957.

In August 1984, Peick informed Floyd that he (Peick) had a problem with a union car, the 1983 Cadillac Sedan DeVille which the union had assigned to Floyd. Peick told Floyd to "dump" the car. Floyd did not ask Peick why he wanted the car dumped nor did Floyd question Peick's authority to issue the order. Floyd contacted his cousin, Kenneth Floyd, and asked him to find someone to take the car.

Kenneth Floyd approached Otto Bremer and offered him the car. Unbeknownst to Kenneth Floyd, Otto Bremer was a government informant. Floyd subsequently gave his car keys to Kenneth Floyd so that a duplicate set could be made. On August 28, 1984, Floyd parked the car in the parking lot of a shopping center in Kankakee, Illinois where Bremer later arranged to "steal" it. Floyd then notified the Kankakee police department that the car had been stolen.

Several weeks later, Bremer met with Floyd to return the two-way radio which had been in the trunk of the car. Floyd informed Bremer that Peick had been "raising hell" with him for allowing the radio to be seized. Soon after, Floyd telephoned Peick and read off its serial numbers. After apparently checking these numbers against some records, Peick directed Floyd to get rid of the radio. Floyd threw the radio into the Kankakee River.

Floyd obtained the police report on the stolen car and gave it to Peick; Peick sent the report to the union's insurance carrier to receive reimbursement for the vehicle. The United States Fidelity & Guaranty Insurance Company subsequently issued a check for $12,850.00 to the union for the loss of the car. The insurance company also paid the union a small sum to partially defray the cost of a rental car.

In November 1985, two special investigators from the United States Department of Labor interviewed Floyd at his home about his role in the staged theft. In April 1985, a grand jury investigated union evidence relating to the taking of the car. The grand jury issued a subpoena to Peick in July 1986. On July 23, 1986, Peick's attorney, responding to the subpoena, stated that Peick had suffered a heart attack earlier that year and that he was unable to consult with counsel due to continued illness. Peick's counsel further stated that his client intended to invoke his fifth amendment privilege if he were called to testify. Peick died in November 1986.

Floyd was indicted on November 20, 1987. The indictment charged Floyd with conspiracy to commit mail fraud and to embezzle union property in violation of 18 U.S.C. Sec. 371 (Count 1), embezzlement of union property in violation of 29 U.S.C. Sec. 501(c) (Count 2), and mail fraud in violation of 18 U.S.C. Sec. 1341 (Counts 3, 4, 5, 6, 7 and 8). The defendant moved to dismiss the charges against him on the ground that he was prejudiced by preindictment delay. Floyd pointed out that although the government had initiated its investigation in November 1985, he was not indicted for another two years. He argued that Peick's death in the interim precluded him from presenting a cogent defense.

The court rejected Floyd's motion to dismiss for several reasons. The court noted that the death of a material witness does not, in itself, establish prejudice. Indeed, it was not clear that Peick would have testified at trial even had he lived. The court pointed out that Peick, in his counsel's response to the grand jury subpoena, expressed an intent to invoke his fifth amendment privilege against self-incrimination. Accordingly, it was unlikely that Peick would have risked implicating himself by taking the stand at Floyd's trial. The court also remarked upon Floyd's failure to attempt to preserve Peick's testimony as a means of avoiding any prejudicial effect. Finally, the court stated that Floyd had not demonstrated how Peick's testimony could have exculpated him.

On October 3, 1988, Floyd pleaded guilty to the two counts of mail fraud (Counts 3 and 8), and to that portion of Count 1 which dealt with conspiracy to commit mail fraud. In exchange for Floyd's guilty plea on those counts, the government moved to dismiss Counts 4 through 7. Floyd waived his right to a jury trial on the charges of conspiracy to embezzle (Count 1) and embezzlement of union property (Count 2).

During the bench trial, the government established its case-in-chief primarily through stipulated evidence. The prosecution introduced portions of the constitution and bylaws of Local 705 that described the expected duties of union officers. The by-laws specified that officers owed a fiduciary duty to the union and were expected to carry out union objectives through lawful methods.

The government also introduced evidence that in May 1984, Local 705 was involved in a prolonged labor dispute with a freight company, Overnite Transportation. During the strike, Overnite's employees were threatened and several of its vehicles were damaged. Union members frequently followed Overnite drivers in their cars, a practice known as "tailgating." ¹ Overnite employees reported these occurrences and, when able, recorded the license plate numbers of cars involved in tailgating. The prosecution introduced a report which indicated that Floyd's car had been involved in a tailgating incident in June 1984.

Floyd testified at trial. He explained that Peick ordered him to dump the car. Floyd conceded that, at the time the order was issued, he suspected the car might have been involved in wrongdoing related to the Overnite dispute. However, Floyd stated that he never asked Peick why he wanted the car taken away. He also testified that Peick had not spelled out how he wanted this task accomplished.

Floyd admitted to arranging for the "theft" and destruction of the automobile. Floyd defended on the ground that he lacked the scienter to be held guilty of embezzling and conspiring to embezzle the car because Peick had granted him the authority to dispose of the property.

In support of his contention, Floyd submitted portions of the union's constitution and by-laws indicating that Local 705 was controlled by its principal executive officer, the Secretary-Treasurer. Floyd also presented testimony from John Navigato, a union board member and president of the union, and from Michael O'Grady, a former board member. Navigato and O'Grady testified that Peick ran Local 705 with "an iron fist." According to Navigato and O'Grady, Peick issued orders instead of asking for recommendations. Peick would often scream and yell at union personnel and, if a staff member disobeyed his orders, Peick would harshly reprimand, demote, or perhaps fire that worker. Peick called executive board meetings at his whim. At these meetings, other board members would generally agree to whatever Peick recommended. Peick often referred to the local as "his union."

Navigato, O'Grady, and the defendant testified that Peick exerted sole authority over the use and disposition of union cars. Moreover, the local's by-laws empowered the principal executive officer to "sell, exchange or lease automobiles or arrange financing therefor in behalf of the Local Union." Peick arranged for insurance on the cars and he alone determined who would receive the cars, and if and when the cars needed to be replaced.

The district court was not persuaded by Floyd's defense that he lacked the requisite criminal intent to embezzle union property or to conspire to embezzle. On November 4, 1988, the court found him guilty of both charges. Floyd was sentenced to two years imprisonment on Counts 1, 2, and 3, to run concurrently. The court suspended sentence on Count 8 and ordered Floyd to five years probation, conditioned on his performing 600 hours of community service and paying restitution to both the insurance company and to Local 705. Pursuant to 18 U.S.C. Sec. 3013, Floyd was also ordered to pay a special assessment of $200.00. This appeal followed.

II. ANALYSIS

Floyd raises two contentions on appeal. He first argues that there was insufficient evidence to support his conviction under 29 U.S.C. Sec. 501(c) and the conspiracy to embezzle conviction under 18 U.S.C. Sec. 371 because the government failed to show that he had the requisite scienter. Second, he asserts that he was prejudiced by preindictment delay in that a key defense witness died prior to the date of trial. We examine each of these contentions in turn.

A. Section 501(c) Violation

Floyd contends that the government failed to prove that he willfully violated a provision of the Labor-Management Reporting and Disclosure Act, 29 U.S.C. Sec. 501(c). ² In assessing a challenge to the sufficiency of the evidence, we review...