U.S. v. Haddock, s. 93-3034

• Citation: 12 F.3d 950
• Decision Date: 13 December 1993
• Docket Number: 93-3157,Nos. 93-3034,s. 93-3034
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Kenneth E. HADDOCK, Defendant-Appellant.
• Court: United States Courts of Appeals. United States Court of Appeals (10th Circuit)

Page 950

12 F.3d 950

UNITED STATES of America, Plaintiff-Appellee, v. Kenneth E. HADDOCK, Defendant-Appellant.

Nos. 93-3034, 93-3157.

United States Court of Appeals Tenth Circuit.

Dec. 13, 1993.

Rehearing Denied March 2, 1994.

Samuel Rosenthal, Curtis Mallet-Prevost, Colt & Mosle, Washington, DC, for defendant-appellant.

Kurt J. Shernuk, Asst. U.S. Atty. (Randall K. Rathbun, U.S. Atty., with him on the briefs), Kansas City, KS, for plaintiff-appellee.

Before SEYMOUR, BARRETT, and ANDERSON, Circuit Judges.

STEPHEN H. ANDERSON, Circuit Judge.

Kenneth Haddock appeals his sentence and the district court's denial of his petition under 28 U.S.C. Sec. 2255 alleging ineffective assistance of counsel. We remand for resentencing,

but we affirm the district court's denial of Haddock's Sec. 2255 petition.

BACKGROUND

We will not relate the facts of this case in detail because we have previously done so in resolving Haddock's direct appeal. See United States v. Haddock, 956 F.2d 1534 (10th Cir.), cert. denied, --- U.S. ----, 113 S.Ct. 88, 121 L.Ed.2d 50 (1992). In that opinion, we affirmed Haddock's conviction on counts two through seven, nine, and ten, but we reversed Haddock's sentence and remanded for resentencing because the district court had enhanced Haddock's sentence on the basis of Haddock's gain rather than his victims' loss. Id.

Briefly, Haddock was chairman of the board and chief executive officer of the Bank of White City, as well as president and sole shareholder of First Finance, Inc., which he formed for the purpose of acquiring loans from the FDIC. He was convicted of six counts of bank fraud under 18 U.S.C. Sec. 1344, one count of filing a false financial statement in violation of 18 U.S.C. Sec. 1014, and one count of concealing relevant information from the FDIC in violation of 18 U.S.C. Sec. 1007, all committed in the process of buying and selling loans for First Finance.

Count two. In May, 1987, Kaw Valley State Bank loaned First Finance $711,000. When Haddock applied for the loan, he gave Kaw Valley a copy of his personal financial statement that failed to list $10,000 that Haddock owed to First Finance and a $350,000 open credit line from First Finance to Haddock.

Count four. Kaw Valley's $711,000 loan to First Finance was to be secured by a purchase money security interest in the Easton loans. Haddock therefore signed an affidavit that the loan proceeds would be used to buy the Easton loan package. Haddock also showed Kaw Valley a copy of a check that he misrepresented to be the check First Finance had used to buy the Easton loans. Despite his representations, Haddock actually used $250,000 of the loan proceeds to refund the Bank of White City's down payment for rights to buy the Easton loans, and $55,000 for himself. Nevertheless, First Finance did buy the Easton loan package for roughly the same price Haddock reported to Kaw Valley.

Count three. First Finance bought the Easton loans intending to resell them to the Bank of White City. White City initially gave Haddock a $250,000 cashier's check as a "downpayment on exclusive purchase rights" for the Easton loan package. Haddock spent roughly $200,000 of that down payment on an unrelated transaction and the rest on a house for himself. He subsequently returned the $250,000 out of the $711,000 Kaw Valley loan.

Count five. White City later entered into a new agreement with First Finance, in which White City gave $350,000 as a down payment for exclusive rights to purchase the Easton package. However, Haddock did not disclose that he had already pledged the Easton loans to Kaw Valley as security for the $711,000 loan to First Finance.

Count six. In October, 1987, White City gave Haddock $273,500 to buy another group of loans, the Nortonville package. That amount covered the entire purchase, and White City understood from Haddock that it was buying the entire package. Nevertheless, Haddock delivered to White City only twelve of twenty-nine loans, two of which he later repurchased for $92,000.

Count seven. Haddock also used the Nortonville purchase as collateral for a $94,000 loan from Kaw Valley to First Finance. He fraudulently pledged the entire Nortonville package as security for the loan, even though White City had bought twelve of the loans. Haddock also showed Kaw Valley a copy of a First Finance check for $200,000 that he misrepresented to have been used to buy the Nortonville loans.

Count nine. Later in 1987, White City agreed to buy the Galena loan package from First Finance. White City gave Haddock a total of $120,766.45 for the purchase. Haddock led White City to believe that First Finance paid $95,766.45 for the loans; the parties agreed that the remaining $25,000 was a servicing fee for First Finance. The actual cost of the Galena package was only $70,766.45.

Count ten. Finally, during an FDIC investigation, Haddock altered some of the check stubs in the First Finance checkbook, changing some deposits and eliminating substantial overdrafts during two months in 1987.

Before trial, Haddock produced for his attorney, Carl Cornwell, copies of five documents that corroborated Haddock's testimony and disproved almost all of the counts against him. Although Cornwell knew that the government would challenge their authenticity, he accepted Haddock's assurances that they were authentic and relied heavily on the five documents. With little or no investigation of their testimony, he decided that several possible witnesses would not add much to Haddock's defense and that it would be best to keep the case simple and rely on the five documents and Haddock himself. The trial judge refused to admit the five documents, however, and the jury found Haddock guilty on all counts.

DISCUSSION

I. Ineffective Assistance of Counsel

The district court held that Haddock's counsel was effective. We must accept the district court's underlying factual findings unless clearly erroneous, but we review de novo whether counsel's performance was legally deficient and whether any deficiencies prejudiced Haddock. See United States v. Whalen, 976 F.2d 1346, 1347 (10th Cir.1992); United States v. Miller, 907 F.2d 994, 997 (10th Cir.1990).

To prove ineffective assistance of counsel, Haddock must show that his trial counsel committed serious errors in light of "prevailing professional norms" and that there is a "reasonable probability" that the outcome would have been different had those errors not occurred. Strickland v. Washington, 466 U.S. 668, 688, 694, 104 S.Ct. 2052, 2065, 2068, 80 L.Ed.2d 674 (1984); see also Lockhart v. Fretwell, --- U.S. ----, ---- - ----, 113 S.Ct. 838, 842-43, 122 L.Ed.2d 180 (1993) (emphasizing that prejudice also requires that errors produced an unfair or unreliable trial). That proof must overcome the "strong presumption" that counsel was effective. Strickland, 466 U.S. at 689, 104 S.Ct. at 2065.

A. Adequacy of Counsel's Performance

The Supreme Court has observed that often it may be easier to dispose of an ineffectiveness claim for lack of prejudice than to determine whether the alleged errors were legally deficient. Id. at 697, 104 S.Ct. at 2069-70. We believe that is true in this case, and we reject most of Haddock's claims for lack of prejudice. However, two of Cornwell's alleged errors clearly were not legally deficient.

1. Failure to Present an Opening Statement

Haddock argues that Cornwell's failure to present an opening statement was deficient performance because Cornwell's only reason for waiving the statement was that he did not know what Haddock would say at trial. See J.A. Vol. I at 490. The failure to present an opening statement itself is not ineffective assistance. United States v. Miller, 907 F.2d 994, 1000 (10th Cir.1990). Cornwell's uncertainty about what Haddock would say justified Cornwell's strategic decision and was not itself an error. Cornwell was uncertain not because he had inadequately discussed Haddock's account of the events, but simply because he was not sure what Haddock would decide to say when put on the witness stand. See United States v. Haddock, No. 90-20075-01, slip op. at 3 (D.Kan. May 14, 1993) (finding that Cornwell and Haddock met "on a number of occasions" for one and one-half to two hours and longer on weekends). Cornwell's failure to present an opening statement therefore did not fall below prevailing professional norms.

2. Failure to Object to Improper Evidence

Haddock cites two instances in which Cornwell failed to object to improper evidence. In one instance, he failed to object to hearsay about what the bank examiners were told. Appellant's Br. at 39. In another, he failed to object to the bank examiner's summary of Patricia Fells' testimony. Id. at 40. Failure to object on these two occasions did not make Cornwell ineffective. See Yarrington v. Davies, 992 F.2d 1077, 1080 (10th Cir.1993) ("Mere failure to object to evidence does not render an attorney ineffective."). The Sixth Amendment does not guarantee an errorless trial, and "prevailing professional norms" do not require perfection at trial. See Denton v. Ricketts, 791 F.2d 824, 828 (10th Cir.1986).

B. Prejudice

1. Failure to Interview Witnesses

On appeal, Haddock complains that he was prejudiced by Cornwell's failure to interview four witnesses that Haddock had identified for Cornwell: Teal Dakan, Bob Unruh, Gary Stafford, and Gloria Stafford. ¹ Even if Cornwell's decision not to investigate their testimony did not meet prevailing professional norms, we hold that Cornwell's failure to investigate did not prejudice Haddock.

Teal Dakan. Haddock argues that failure to interview Teal Dakan, White City's accountant, was prejudicial for two reasons. First, Dakan would have testified that his conversations with Haddock should have led Haddock to believe in good faith that it was proper to use the loan portfolios as collateral for third-party financing. See J.A. Vol. I at 225-26; J.A. Vol. II at 496A. Second, Dakan would...