U.S. v. Kuzniar, 88-2790

Citation881 F.2d 466
Decision Date24 October 1989
Docket NumberNo. 88-2790,88-2790
PartiesUNITED STATES of America, Plaintiff-Appellant, v. Edward KUZNIAR and George Pistas, Defendants-Appellees.
CourtUnited States Courts of Appeals. United States Court of Appeals (7th Circuit)

Michael T. Mullen, Asst. U.S. Atty., Chicago, Ill., for U.S.

Dean P. Karlos, Karlos & Associates, John J. Armellino, Jr., Chicago, Ill., for Edward Kuzniar and George Pistas.

Before FLAUM and MANION, Circuit Judges, and ESCHBACH, Senior Circuit Judge.

FLAUM, Circuit Judge.

After a jury trial in which the defendants were found guilty on twelve counts of arson, mail fraud, and conspiracy to commit mail fraud and arson, the district court granted the defendants a new trial on seven of the counts and acquitted them on the other five. We find that the district court abused its discretion in granting the defendants a new trial on the seven counts. Further, we believe the district court erred in acquitting the defendants on the remaining counts. Therefore, we reverse, reinstate the jury's verdict and remand to the district court for sentencing.

I.
A.

Defendants Edward Kuzniar and George Pistas were each charged in an indictment, and subsequently in a superseding information, with one count of committing arson, in violation of 18 U.S.C. Sec. 844(i), one count of conspiracy to commit arson and mail fraud, in violation of 18 U.S.C. Sec. 371, and ten counts of mail fraud, all violating 18 U.S.C. Sec. 1341. The defendants pleaded not guilty and were tried before a jury.

At trial, evidence was introduced to show the following. Defendants Kuzniar and Pistas were partners in a business called A Apple Glass and Board-Up Inc. ("A Apple") whose offices were located at 4311 West Fullerton Avenue in Chicago. In January 1984, the defendants acquired a run-down building located at 4120 West Chicago Avenue in Chicago (the "Chicago Avenue building" or "building"). The defendants obtained the building, which had a price of $70,000, with the intention of turning it into a commercial flea market. Shortly after the purchase, the defendants obtained insurance from the Traveler's Insurance Company ("Traveler's") for the building in the amount of $600,000, the alleged replacement value of the building.

Extensive renovations were made to the building, including the introduction of security devices, and the flea market opened for business in June 1984. In the fall of 1984 the flea market was closed for the season, never to reopen. During the subsequent winter defendant Kuzniar apparently encountered financial difficulties. In response, the defendants, on at least three occasions, unsuccessfully attempted to sell their interest in the building for approximately $100,000.

On April 9, 1985, a fire destroyed a significant portion of the Chicago Avenue building. The government introduced substantial circumstantial evidence to show that the fire was the result of an arson committed by the defendants. Mary Volpee, a resident of the area near the building, testified that on the morning of the fire she saw a man carrying a five-gallon gasoline can exit the building and pour some kind of liquid at the base of the building. Ms. Volpee testified that after a quick stop at her home, she returned to the building and saw that a second man had joined the first. The second man also carried a gasoline can, and both men stood watching while smoke began to filter out of the building. Ms. Volpee identified the first man as defendant Pistas.

Ms. Volpee's daughter, Linda Pamonicutt, was also present near the building at the time of the fire. She testifed that she saw the first man exit the building as smoke began to emanate from its apertures. She went to a nearby grill to call the fire department only to find a husky man already using the phone. The man assured Ms. Pamonicutt that he had already called the fire department. Ms. Pamonicutt identified the first man as defendant Pistas and, after some difficulty, identified the second, husky man as defendant Kuzniar.

Several of the firemen who fought the blaze at the building were called to testify by the government. One of the firemen testified to seeing Ms. Volpee, or at least a woman fitting her description, at the scene. Another testified to the difficulty the firemen encountered in entering the building, which the defendants could have diminished by furnishing keys, as well as their surprise at not hearing any alarms upon entering the building despite the presence of security devices. Finally, Richard Sinnott, a battalion chief present at the fire, testified that Kuzniar told him that it didn't matter whether the building was saved because he was going to tear it down anyway.

The government also introduced the testimony of several experts in the area of arson investigation. Although the experts disagreed in some particulars, they each testified to the presence of petroleum distillate in samples of the debris taken from the building and to other peculiar characteristics of the fire. For example, the experts testified that they found an identifiable pour pattern for fire accelerant on the floor of the building and "beading" of the copper in the building, a sign of abnormally high temperatures during the fire. Both the presence of an accelerant and the beading are consistent with an arson theory. The experts did not completely discount the possibility of a natural origin for the fire but, in the words of one of the experts, thought such a possibility "highly improbable" or "virtually impossible."

The district court's difficulty with the government's case stems from the testimony of government witness Robert Arens Jr., and the defendants' evidence contradicting that testimony. Judge Marshall found Arens' testimony unbelievable as a matter of law and decided that permitting the jury to hear the testimony so prejudiced the defendants that, in the interests of justice, a new trial was required.

B.

Robert Arens Jr., a teenager at the time of the events in question, worked at A Apple as part of a high school work/study program. Arens claimed that he was employed at A Apple's Fullerton Avenue office performing general maintenance and clean-up from October 1984 through the middle of January 1985. Arens testified that in January 1985, while doing some cleaning in the hallway outside Kuzniar's office, he overheard a conversation between Kuzniar and Pistas regarding the Chicago Avenue building. Kuzniar reportedly mentioned the problems they were having with the Chicago Avenue building and then asked Pistas what they were going to do. Pistas replied that he didn't know what they should do and repeated that answer when Kuzniar persisted. Finally, according to Arens, Kuzniar pulled out a cigarette lighter, drew a flame and stated "I think this is what we should do." Pistas asked whether that was a good idea and Kuzniar replied that it was "the only way." At that point, Pistas saw Arens, came storming out of the office, and fired him on the spot.

Arens further testified that within two weeks of the firing he had found a new job working for Kevin Doublin at Chicago's Finest Board-Up Service Inc. Doublin, testifying after Arens, corroborated this part of Arens' testimony. Doublin also testified that Arens told him that he had been fired from his previous job because he overheard a conversation between his former bosses.

On cross-examination, Arens was forced to admit that he had previously told an investigator that the conversation he overheard had occurred in March 1985, rather than in January of that year. Also, after denying that his employment with A Apple was actually in March 1984, Arens was confronted with time cards and pay stubs which showed that he did work for the company in that time period. Arens denied endorsing most of the checks and claimed that the time cards were forgeries. Finally, in an exchange regarding some visits he made to the Chicago Avenue building, Arens claimed that he was at the building before the flea market opened, placing the visits sometime before June 1984.

Defendants introduced other evidence to show that Arens actually worked at A Apple in March 1984. That evidence established that the only checks issued to Arens were dated March 1984 and that A Apple paid all its employees by check. Testimony was also introduced from Paul Zack, the operator of Pioneer Maintenance Service, who claimed that he alone provided maintenance and clean-up services to A Apple during the period between October 1984 and January 1985.

At the close of trial, the defendants moved for a judgment of acquittal claiming that Arens' testimony was perjured. The district court, although it stated that Arens' testimony was unworthy of belief, allowed the case to go to the jury. The district court warned the government, however, that it should either withdraw Arens' testimony or tell the jury to disregard it. In closing arguments, however, both the government and the defendants discussed Arens' testimony and argued, respectively, for and against his credibility. The jury subsequently convicted the defendants on all counts.

In post-trial motions, the defendants again asked for a judgment of acquittal based on Arens' "inherently incredible" testimony and also asked for a new trial based on newly discovered evidence. The newly discovered evidence was an affidavit from Louie Gattorna, the teacher at Arens' school responsible for the work/study program. The affidavit stated that Arens was not in the work/study program between October 1984 and January 1985, and that Gattorna had never supervised Arens. In response to this submission, the district court took the unusual step of requesting additional evidence regarding Arens' credibility.

In the evidentiary hearing that followed, the government introduced evidence that Arens actually was in the work/study program in the relevant period. Also, an expert in handwriting...

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