U.S. v. Judd, 88-4562

• Decision Date: 29 November 1989
• Docket Number: No. 88-4562,88-4562
• Citation: 889 F.2d 1410
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. David W. JUDD, Robert N. Puett, Sage Poodry, and Jerry Dean Hall, Defendants-Appellants.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 1410

889 F.2d 1410

UNITED STATES of America, Plaintiff-Appellee, v. David W. JUDD, Robert N. Puett, Sage Poodry, and Jerry Dean Hall, Defendants-Appellants.

No. 88-4562.

United States Court of Appeals Fifth Circuit.

Nov. 29, 1989.

Stephen B. Shankman, Memphis, Tenn., for David W. Judd.

William O. Rutledge, III, New Albany, Miss. (court-appointed), for Robert N. Puett.

Thomas W. Dawson, Alfred E. Moreton, III, Robert O. Whitwell, U.S. Atty., Oxford, Miss., for plaintiff-appellee.

Robert G. Gilder, Southaven, Miss. (court-appointed), for Poodry.

John H. Dunbar, Oxford, Miss. (court-appointed), for Jerry Dean Hall.

Appeals from the United States District Court for the Northern District of Mississippi.

Before JOHNSON, WILLIAMS and GARWOOD, Circuit Judges.

JERRE S. WILLIAMS, Circuit Judge:

Appellants David W. Judd, Robert N. Puett, Sage Poodry, and Jerry Dean Hall were convicted of various offenses arising out of a fraudulent land sale scheme under 18 U.S.C. Secs. 371, 1341, 1343, & 2314 and 15 U.S.C. Secs. 1703 & 1717. From these convictions, they appeal. Finding no error, we affirm.

I. Facts

Appellants were employed by the Kilgore Mining Company ("KMC"). KMC's business was the telemarketing of land with "guaranteed" coal deposits. Judd was the sole shareholder, president, and chief operating officer of KMC. Puett was a vice president. Hall and Poodry were salesmen.

KMC's operations were conducted from an office in Southaven, Mississippi. From this office, KMC salesmen solicited potential investors with a telephone sales pitch. Written promotional materials were mailed to investors who expressed interest in the project. The promotional materials included a geology report supporting KMC's claim that substantial coal deposits were contained under the land being marketed. The report was a fake. On some occasions, the promotional materials also included a falsified Dun and Bradstreet report on KMC's financial situation.

KMC salesmen often referred potential investors to "previously satisfied investors" who reported prior profitable investments with KMC. In fact, the "previously satisfied investors" had not made prior investments with KMC. These "bird dogs" or "shills," as they were referred to by the KMC salesmen, were paid $300 for each fraudulent recommendation.

KMC salesmen made representations to potential investors concerning the price of coal, mining dates, recoverable coal per acre, purchase of the coal by foreign companies, and profits to be made within a certain time from the mining and sale of the coal. The investors were promised deeds to any purchased property.

KMC did not own the mineral rights in the land it was selling. KMC actually owned only an option on the surface rights of a 358 acre tract in Sebastian County, Arkansas. No coal lay beneath the tract. Coal which had existed on a portion of the land had previously been mined.

Special Agent Wayne P. Tichenor of the Federal Bureau of Investigation began an investigation of KMC in January, 1986. On May 12, 1986, Tichenor secured a search warrant from a United States magistrate. The warrant specified the location to be searched as "Kilgore Mining Co., Inc., 9172 Highway 51 N., Suite B., Southaven, MS." KMC actually occupied two offices at this location. These offices were at 9172-B and at 9170 Highway 51 N.

Tichenor and six other agents executed the warrant and searched the premises at 9172-B. The agents then searched the office at 9170 and seized business records that were later used as evidence at the trial.

On July 24, 1987, a grand jury returned a 154 count indictment against appellants and others. The indictment charged appellants with offenses relating to fraud in the operation of KMC.

Appellants Judd and Puett filed a motion to suppress the items seized from the office at 9170. After a hearing, the district court denied the motion. Appellants were tried before a jury which returned verdicts of guilty. ¹ Judd was sentenced to 20 years in prison, while Puett received a 16-year sentence. Poodry and Hall were each sentenced to 5 years in prison.

Appellants Judd and Puett appeal the denial of their motion to suppress. Appellant Hall asserts the district court erred in refusing to instruct the jury that a violation of the Interstate Land Sales Full Disclosure Act (ILSFDA), upon which some of the convictions were based, requires specific intent. Hall further asserts the district court erred in instructing the jury with regard to the mail and wire fraud charges. Finally, appellants Judd, Poodry, and Hall attack the sufficiency of the government's evidence. The appeal is timely.

II. Validity of the Search

Judd and Puett do not attack the validity of the search warrant or the search of the main KMC office at 9172-B. Instead, they assert that because the search warrant named only the 9172-B office and not the bookkeeping office with its separate address of 9170, the search of the 9170 office was warrantless and unreasonable.

The district court, in a thorough and well-reasoned opinion, found that neither Judd nor Puett established standing to challenge the search. United States v. Judd, 687 F.Supp. 1052, 1061 (N.D.Miss.1988). The trial court also found that even if standing was established, the search warrant was sufficient to authorize the entire search. Judd, 687 F.Supp. at 1058. Because we agree with the district court's reasoning and conclusions, our treatment of these issues is brief.

Standing is a privacy or property interest in the premises searched or the items seized which is sufficient to justify a "reasonable expectation of privacy" therein. Williams v. Kunze, 806 F.2d 594, 599 (5th Cir.1986). Judd and Puett have the burden of establishing their standing. United States v. Antone, 753 F.2d 1301, 1306 (5th Cir.1985), cert. denied, 474 U.S. 818, 106 S.Ct. 64, 88 L.Ed.2d 52 (1985).

The bookkeeping area at 9170 was neither Judd's nor Puett's office. They did not work out of that office. Judd, however, was involved in the preparation of some of the records seized from the 9170 office. In view of these facts, we find that appellants Judd and Puett, as individuals, have no standing to challenge the seizure of corporate records from the corporate bookkeeping office. See United States v. Vicknair, 610 F.2d 372, 379 (5th Cir.1980), cert. denied, 449 U.S. 823, 101 S.Ct. 83, 66 L.Ed.2d 25 (1980); United States v. Bush, 582 F.2d 1016, 1018-19 (5th Cir.1978); United States v. Judd, 687 F.Supp. at 1055-56.

Although we find no standing to challenge the search, we nonetheless point out briefly that Judd's and Puett's substantive complaint is contrary to the well-established law concerning the specificity required in warrants. The rule is that "[a]n error in description is not always fatal." United States v. Prout, 526 F.2d 380, 387 (5th Cir.1976), cert. denied, 429 U.S. 840, 97 S.Ct. 114, 50 L.Ed.2d 109 (1976).

In the present case, the agents checked the city business license records, bank records at a local bank, corporate filings with the Mississippi Secretary of State, and the address on KMC letterhead to ascertain KMC's address. KMC had leased the office at 9170 only three weeks prior to the search. The two offices were in the same building complex and the door to 9170 was only 25 to 30 feet away from the door to 9172-B. Upon these facts, we would conclude that the description of the KMC location contained in the search warrant was sufficient to support a search of the KMC office at 9170. See Prout, 526 F.2d 380; United States v. Darensbourg, 520 F.2d 985 (5th Cir.1975); Judd, 687 F.Supp. at 1056-60.

III. Specific Intent

The district court rejected an instruction requested by appellant Hall that read: "You should acquit each Defendant of each count of violating the Interstate Land Sales Act, if you have reasonable doubt whether that Defendant was aware that the Interstate Land Sales Act applied to the transactions involved in this case." Hall claims the court erred in refusing this instruction, arguing that the ILSFDA is a specific intent statute. We need not reach the question whether the ILSFDA is a specific intent statute, however, because even if the ILSFDA requires specific intent, the instructions given were sufficient.

The court instructed the jury that it was an element of the offense that the defendant acted "willfully and knowingly" which the court defined as acting "voluntarily and purposely with the specific intent to do something the law forbids, that is to say, with bad purpose either to disobey or disregard the law." This instruction clearly gave the jury the freedom to find an absence of specific intent if the jury concluded that the defendants were ignorant of the law. See United States v. Wellendorf, 574 F.2d 1289, 1290-91 (5th Cir.1978). Accordingly, even assuming that specific intent was required, the instruction given was sufficient.

In determining whether the failure to instruct the jury that ignorance of the law may be considered on the issue of specific intent constitutes reversible error, our cases fall into two categories. In one, ... the jury is specifically instructed that ignorance of the law may not be considered. This is an improper instruction. In the other, ... the jury is not specifically instructed that ignorance of the law is no excuse, and the specific intent instruction given, in the context of the case, is sufficient to allow the jury to consider the defendants' ignorance of the law.

United States v. Chavis, 772 F.2d 100, 108 (5th Cir.1985) (citations omitted). We conclude that the jury was properly instructed. It was not necessary also to include Hall's requested instruction concerning ignorance of the law.

IV. Mail and Wire Fraud

Hall and Poodry assert error in the jury instructions on the mail and wire fraud charges. Hall and Poodry claim that under McNally v. United States, 483 U.S. 350, 107 S.Ct. 2875, 97 L.Ed.2d 292 (1987), a conviction for mail and wire fraud can only be...