U.S. v. Luffred, 89-2106

• Decision Date: 30 August 1990
• Docket Number: No. 89-2106,89-2106
• Citation: 911 F.2d 1011
• Parties: 30 Fed. R. Evid. Serv. 1046 UNITED STATES of America, Plaintiff-Appellee, v. Diane G. LUFFRED, Defendant-Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 1011

911 F.2d 1011

30 Fed. R. Evid. Serv. 1046

UNITED STATES of America, Plaintiff-Appellee, v. Diane G. LUFFRED, Defendant-Appellant.

No. 89-2106.

United States Court of Appeals Fifth Circuit.

Aug. 30, 1990.

H. Michael Sokolow, Asst. Federal Public Defender, Roland E. Dahlin, II, Federal Public Defender, Houston, Tex., for defendant-appellant.

James L. Turner, Paula C. Offenhauser, Asst. U.S. Attys., Henry K. Oncken, U.S. Atty., Houston, Tex., for plaintiff-appellee.

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

Before GEE, POLITZ, and BARKSDALE, Circuit Judges.

POLITZ, Circuit Judge:

Diane Luffred appeals her convictions for conspiracy to commit bank fraud and the substantive charge of bank fraud in violation of 18 U.S.C. Secs. 2, 371, and 1344. Finding that the jury's verdict was tainted by the presence of extrinsic evidence in the deliberation room, we reverse and remand for a new trial.

Background

In March 1988 Diane Luffred was named in two counts of a three-count indictment charging her with one count of conspiracy to commit bank fraud and one count of bank fraud, in violation of 18 U.S.C. Secs. 2, 371, and 1344. Peter Luffred, her husband, was named in all three counts. Peter Luffred became a fugitive from justice; Diane Luffred was tried. The evidence adduced at trial disclosed the following scenario.

While employed as a sales agent in the real estate office of Aida Younis in 1984, Diane Papageorgiou met Peter Luffred, a self-styled real estate investor. They married in 1985 and Diane Luffred left Younis' employ. Also sharing space in Younis' office was Younis' brother-in-law, Farooq Samad, who later moved his insurance agency to another location. Although Diane Luffred purchased insurance from Samad she was never in his office. Peter Luffred, however, visited Samad's office frequently to use the telephone and discuss business, continuing to do so even after Samad moved.

Walter Inglhofer, a regional real estate representative for Goodyear Tire and Rubber Company, was contacted by real estate agent David Clendenning who suggested the Luffreds as potential developers for a new Goodyear service center. Peter Luffred telephoned Inglhofer and then wrote two letters, introducing himself and claiming to have developed $40 million worth of shopping centers. As a result of these contacts Inglhofer visited Houston on several occasions. During these visits he, Clendenning, and the Luffreds drove around Houston considering possible sites for a Goodyear service center. Peter Luffred repeatedly boasted of his wealth; Diane Luffred remained silent. She actively participated, largely as one knowledgeable about the Houston real estate market, in about half of the score or so subsequent meetings. During this period Diane Luffred suffered from both colon cancer and heart trouble, which apparently limited her involvement.

Having identified a 2.25-acre tract (the Fondren-Fuqua property) as a prospective location for the center, Diane Luffred contacted Carol Rochetti of Blue Ridge Associates, owner of the property. Rochetti informed her that the price was $2.50 per square foot, or approximately $245,000. Diane Luffred then visited Rochetti and introduced Peter Luffred as her husband and client. After their initial meeting Rochetti directed her correspondence to the attention of Peter Luffred in care of Harvard Investments, a business he had registered in the assumed-name records.

At the initial meeting, Peter Luffred requested that Rochetti raise the price of the tract on the closing statement so that he could secure 100 percent financing for his construction costs. When Rochetti stated that the closing statement had to reflect the actual price Peter Luffred mentioned, in Diane Luffred's presence, that they could structure a "land flip," in which he would find someone to purchase the land from Blue Ridge, and that he would then purchase the land for a higher price. ¹ Goodyear selected the Fondren-Fuqua tract and Peter Luffred signed a letter of intent to purchase the property. Two earnest-money contracts set up the flip transaction--Blue Ridge agreed to sell to Farooq Samad for $245,000 and Samad agreed to sell to the Luffreds for $441,000. Peter Luffred later informed Rochetti that he was substituting his mother, Frances Shetler, for Samad and new earnest-money contracts were executed.

Harvard Investments executed a proposed lease to Goodyear of a portion of what was to become the Fuqua Auto Mall. As the deal solidified, Neil Pummill, a loan broker, made a proposal on the Luffreds' behalf to Guido Piggott, president of United National Bank, seeking financing for the purchase and construction of the shopping center. Costs were estimated at $1.5 million. Peter Luffred was listed as the principal and the proposal contained the Goodyear lease and letters of intent to lease retail space from Cottman Transmission, a fast food store, an insurance agency, and a gold/silver investment office.

Piggott manifested an interest and requested more information. A series of meetings between Peter Luffred and Piggott ensued. As evidence of financial ability Peter Luffred furnished Piggott with copies of what he asserted to be his and his wife's individual tax returns for 1983 and 1984. According to these returns, Diane Luffred earned $79,247 in 1983 and $83,117 in 1984, while Peter Luffred earned, respectively, $91,714 and $99,419. The purported returns of Diane Luffred were unsigned. Evidence adduced at trial reflects no tax filings by Diane Luffred in those two years. There was no evidence, however, that her income level during those two years crossed the return-filing threshold. Diane Luffred did not participate in any of these meetings with Piggott and she personally furnished him no information.

United Bank opted to finance the project and agreed to finance a prompt purchase of the property for $441,000 subject to a supportive appraisal by an appraiser approved by the bank. Peter Luffred agreed to acquire a $100,000 certificate of deposit from the bank and to deliver same as collateral.

Piggott first met Diane Luffred at the closing, which also was attended by Rochetti, Peter Luffred, Frances Shetler, and Jane Holloway who conducted the closing. Shetler first purchased the property for $245,000 and then sold it to Harvard Investments for the amount of the loan, $441,000. Shetler immediately endorsed to her son the check for $193,962.34 she was given. The documents and checks needed to complete the transaction were all signed, at one sitting, by Piggott, Shetler, Rochetti, the Luffreds, and Holloway.

Peter Luffred deposited $125,000 of the check endorsed to him by his mother into an account of Harvard Investments; the remainder was placed in various joint Luffred accounts. Peter Luffred subsequently drew checks on these accounts. Of those checks two allegedly bear the signature of Diane Luffred, one for $30,000 and one for $8,000, both made out to "cash." The custodian of the bank records conceded that he did not know if Diane Luffred actually had signed the two checks because the signatures on the checks did not match the bank's signature cards.

Shortly after the closing the failure of the project to move forward alerted Piggott and Inglhofer. The letters of intent to lease some of the space proved fraudulent. Peter Luffred disappeared. Diane Luffred's efforts to complete the project were unsuccessful and the bank foreclosed, seizing the property and taking the $100,000 certificate of deposit. The instant indictment followed.

The jury returned verdicts of guilty on both counts. The court suspended imposition of sentence, imposed four years probation, and ordered the statutory assessment of $100. During the pendency of this appeal Peter Luffred was apprehended. He pleaded guilty and was sentenced to consecutive terms of imprisonment for five and two years and ordered to pay the $100 statutory assessment and $56,086.16 in restitution.

Analysis

A. The jury's consideration of extrinsic evidence.

Diane Luffred contends that her convictions must be reversed because the jury considered extrinsic evidence during its deliberation. Three times during trial the government sought to introduce into evidence a chart purportedly tracing, through deposits and withdrawals, the proceeds of the United Bank loan. The chart reflected the government's theory of the case and sought to tie Diane Luffred to each deposit and withdrawal made by Peter Luffred by listing her as an account-holder and authorized signer. The chart also depicted Diane Luffred as having signed the two checks that purportedly carried her signature, despite the fact that the authenticity of the signature was the subject of serious dispute. ² Objections to admission of the chart into evidence were sustained each time it was offered by the government. Excluded from the evidence, the chart was used as a trial aid during the government's closing argument.

The jury began its deliberations. During a lunch break the jury asked the deputy marshal for the chart. The marshal imprudently gave it to them. The jury resumed its deliberations for about 30 minutes before the court's case manager became aware of the marshal's action, retrieved the chart, and informed the trial judge, who then advised counsel of the error. The court denied a defense motion for mistrial for lack of a showing of prejudice and the defense requested a curative limiting instruction. The court complied by instructing the jury to disregard anything it may have learned from the chart but then added that the chart had been "supported by the evidence ... to a great extent or perhaps completely...."

It is firmly established in this circuit that a defendant is entitled to a new trial when extrinsic evidence is introduced into the jury room "unless there is no reasonable possibility that the jury's verdict was influenced by the material that improperly came...