U.S. v. Manarite

• Decision Date: 15 March 1995
• Docket Number: 93-10528,Nos. 93-10527,s. 93-10527
• Citation: 44 F.3d 1407
• Parties: 41 Fed. R. Evid. Serv. 742 UNITED STATES of America, Plaintiff-Appellee, v. Samuel MANARITE and Jeanne Manarite, Defendants-Appellants.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1407

44 F.3d 1407

41 Fed. R. Evid. Serv. 742

UNITED STATES of America, Plaintiff-Appellee, v. Samuel MANARITE and Jeanne Manarite, Defendants-Appellants.

Nos. 93-10527, 93-10528.

United States Court of Appeals Ninth Circuit.

Argued and Submitted Oct. 5, 1994.

Decided Jan. 6, 1995.

As Amended on Denial of Rehearing March 15, 1995.

Arthur L. Allen, P. Danice Johnson, Asst. Federal Public Defenders, Mark A. Hutchison, Jose Leon, Morris, Brignone & Pickering, Las Vegas, NV, for defendants-appellants.

Jane H. Shoemaker, Asst. U.S. Atty., Organized Crime Strike Force, Las Vegas, NV, for plaintiff-appellee.

Appeal from the United States District Court for the District of Nevada.

Before: SNEED, PREGERSON, and WIGGINS, Circuit Judges.

SNEED, Circuit Judge:

Samuel and Jeanne Manarite appeal their convictions for conspiracy, money laundering, and interstate transportation and receipt of stolen property. ¹ They contend that the trial

court erred in (1) denying their motions for judgment of acquittal, (2) refusing to instruct the jury on entrapment, (3) denying Jeanne Manarite's motion to sever, (4) admitting evidence of Samuel Manarite's parole status, and (5) assessing their sentences. We reverse the Manarites' conspiracy convictions, vacate their sentences, and remand the case for resentencing.

I. FACTS AND PROCEEDINGS BELOW

This case involves three criminal schemes that developed as a result of a sting operation conducted by the Federal Bureau of Investigation (FBI) in Las Vegas, Nevada, viz., a casino chip-cashing scheme, a casino credit scam, and the burglary of a fictitious drug dealer's boat.

Under the FBI's direction, an informant, Richard McLaughlin, set out to "get close" to Samuel Manarite. Manarite had an extensive criminal record and was reputed to have ties to the Mafia. They first met in December 1991, when McLaughlin approached Manarite to sell him some jewelry. Though Manarite had intermittent suspicions that McLaughlin was a cop, the two became acquaintances.

Manarite suggested that they could "earn some money together." McLaughlin told Manarite that he had a contact at the Maxim casino, "Bill Peterson," who was in fact FBI Special Agent William Matthews. Over the next few weeks, McLaughlin and Manarite discussed possible ways to make money at the casino, in the course of which McLaughlin often wore a wire.

A. The Chip-Cashing Scheme

The first result of these meetings was a chip-cashing scheme, which unfolded in this manner. Sometime during March 1992, McLaughlin met with Manarite and his wife, Jeanne. McLaughlin told them that "Peterson" had a dealer who was skimming casino chips off the blackjack tables and needed someone to cash them. The Manarites proposed various ways to cash the chips; Jeanne suggested taking them to the cage in small amounts. Eventually, it was agreed that the Manarites and McLaughlin would cash the chips. During March and April, $17,925 worth of casino chips were cashed. Jeanne and their son, Robert, did much of the work because Samuel was on parole, and Jeanne didn't want to "risk" him. At the end of April, "Peterson" told Samuel Manarite that the dealer had become nervous and had stopped skimming chips.

B. The Credit Scam

The sting operation now entered its second phase. In May, "Peterson" and McLaughlin met with the Manarites to devise a credit scam. On May 16, as planned, Sandra Bonham, a friend of Robert Manarite, used a fake driver's license and filed a false credit application at the Maxim casino. "Peterson" approved $5,000 credit to Bonham up front. The scam was carried out on a Saturday, to prevent the casino from processing the application until Monday. Bonham took the money in chips, gambled awhile to avoid looking suspicious, and gave $4,800 in chips to the Manarites. Over the next few days, McLaughlin and Samuel Manarite cashed the chips.

C. The Burglary of a Boat

In June, to instigate the third sting operation, "Peterson" approached Samuel Manarite with a burglary scheme. "Peterson" claimed that he laundered money for a drug dealer in California. He said that during his visits, he and the dealer would invariably go McLaughlin and Jeanne and Robert Manarite met in Marina Del Rey, California, on June 9. McLaughlin and Jeanne acted as lookouts while Robert boarded the boat and removed $18,300 worth of cash and casino chips, plus three pieces of jewelry. Of course, the boat and everything on board were actually owned by the FBI. The three drove the proceeds of the burglary back to Las Vegas. The sting operations, so far as we know, were finished.

out to lunch, leaving the money aboard the dealer's boat. "Peterson" assured Manarite that the boat would be left unattended with the door unlocked, so it would be easy to steal the money. Manarite agreed to arrange the burglary.

Samuel and Jeanne Manarite were indicted on January 26, 1993. Both were charged with conspiracy, money laundering, wire fraud, interstate transportation and receipt of stolen property, and aiding and abetting. The Manarites were tried together. At the close of the government's case, both moved for judgment of acquittal under Rule 29(a). Their motions were denied. Jeanne Manarite requested that the judge instruct the jury on entrapment. The judge refused. The jury convicted both defendants of all counts except those related to the credit scam. ² The defendants moved again for judgment of acquittal under Rule 29(c). The court denied their motion.

The defendants timely appeal. This court has jurisdiction under 28 U.S.C. Sec. 1291. We hold that the Manarites' convictions for conspiracy must be reversed. We affirm the remainder of their convictions.

II. DISCUSSION

A. The Conspiracy Convictions

The Manarites contend they were entitled to a judgment of acquittal because their convictions were based on insufficient evidence. We agree with respect to the conspiracy convictions.

This court uses the same standard of review for denial of a motion for judgment of acquittal as it does for a challenge to the sufficiency of the evidence. United States v. Shirley, 884 F.2d 1130, 1134 (9th Cir.1989). We must review the evidence in the light most favorable to the government to determine whether " 'any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt.' " Id. (quoting Jackson v. Virginia, 443 U.S. 307, 319, 99 S.Ct. 2781, 2789, 61 L.Ed.2d 560 (1979)) (emphasis in original). The evidence is insufficient to support a conviction for the substantive crime of either mail or wire fraud. As will appear subsequently, the Manarites could not be convicted of conspiracy to commit mail or wire fraud, either. The conspiracy charge did include several other crimes as objects of the conspiracy, any one of which would have been sufficient to support the conspiracy convictions. The jury, however, used a general verdict form, which does not reveal which object or objects the jurors relied on to find the Manarites guilty of conspiracy. Because the jurors could have relied exclusively on the legally insufficient objects (mail or wire fraud), we are obliged to reverse the Manarites' conspiracy convictions.

1. Insufficiency of the mail fraud ³ and wire fraud ⁴ objects.

The Manarites argue that the evidence was insufficient to support their convictions for conspiracy to commit mail and wire fraud. In particular, they maintain that the telephone calls and mailings resulting from the credit scam at the Maxim casino were not in furtherance of the scheme. We agree.

We have interpreted the mail fraud statute to require proof that the accused (1) participated in a scheme or artifice to defraud, and (2) caused a use of the mails, (3) for the purpose of executing the scheme. United States v. Brutzman, 731 F.2d 1449, 1454 (9th Cir.1984). ⁵ The issue is whether The Manarites rely mainly on United States v. Maze, 414 U.S. 395, 94 S.Ct. 645, 38 L.Ed.2d 603 (1974). There, the accused traveled to California with his roommate's credit card and charged motel rooms and meals. He was indicted for mail fraud, based on the motels' mailing sales slips to the bank that had issued the card, which then mailed a bill to the roommate. The government argued that "the delay in this mailing would enable the [defendant] to continue purchasing goods and services for an appreciable period of time." Id. at 397, 94 S.Ct. at 647.

the Manarites' actions in executing the fraud on a weekend, in order to ensure that the casino would be unable to process the false credit application until Monday, caused a use of the mails for the purpose of executing the scheme.

The Court, however, found that the mailings did not further Maze's scheme. Maze's scheme had already been completed; it "reached fruition when he checked out of the motel, and there is no indication that the success of his scheme depended in any way on which of his victims ultimately bore the loss." Id. at 402, 94 S.Ct. at 649. The mailings were merely "directed to the end of adjusting accounts between the motel proprietor, the Louisville bank, and [the roommate], all of whom had ... been the victims" of the scheme. Id.

Here, the government argues that, unlike the defendant in Maze, the Manarites deliberately structured the credit scam to delay the inevitable mailing or phone call. ⁶ This is true; however, their scheme was complete when they cashed the chips. The fact that the delay enhanced the Manarites' ability to escape detection is insufficient. Moreover, their chance of avoiding detection would have been enhanced even more had there been no use of the mails or telephone at all.

The government points out that "[l]etters mailed after the defrauders have received their money may be in furtherance of the fraudulent scheme." Brutzman, 731 F.2d at 1454. The Supreme Court has identified two such scenarios: the "lulling scheme" and the "ongoing scheme." The Manarites' case, however, does not fall into either category.

In a lulling...