U.S. v. McAuliffe

• Decision Date: 22 June 2007
• Docket Number: No. 06-3016.,06-3016.
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Don S. McAULIFFE, Defendant-Appellant.
• Court: U.S. Court of Appeals — Sixth Circuit

490 F.3d 526

UNITED STATES of America, Plaintiff-Appellee, v. Don S. McAULIFFE, Defendant-Appellant.

No. 06-3016.

United States Court of Appeals, Sixth Circuit.

Argued: January 26, 2007.

Decided and Filed: June 22, 2007.

ARGUED: David J. Graeff, Westerville, Ohio, for Appellant. Michael A. Rotker, United States Department of Justice, Washington, D.C., for Appellee. ON BRIEF: David J. Graeff, Westerville, Ohio, for Appellant. Michael A. Rotker, United States Department of Justice, Washington, D.C., Kevin W. Kelley, David M. DeVillers, Assistant United States Attorneys, Columbus, Ohio, for Appellee.

Before: MERRITT, DAUGHTREY, and GRIFFIN, Circuit Judges.

OPINION

GRIFFIN, Circuit Judge.

On March 8, 2002, a fire destroyed the Millersport, Ohio, lakeside residence of defendant-appellant Don S. McAuliffe, a duly-elected sitting judge of the Fairfield County Municipal Court, Lancaster, Ohio. At the time of the fire, defendant was vacationing in the Virgin Islands. Defendant twice sent verified proof of loss claim forms to his insurer, Grange Mutual Casualty Company ("Grange"), via United States mail, representing in the forms that "the cause and origin of the said loss were: UNKNOWN TO CLAIMANT." Defendant eventually settled his claim for $235,000. He used the insurance proceeds to pay off the mortgage on the destroyed property and a car loan, and to make a down payment on another parcel of real estate. Federal, state, and local authorities, however, became suspicious that the fire had been purposefully set by defendant and a business partner, Darrell Faller, as part of a scheme to defraud the insurance company.

On April 23, 2003, following an investigation into the matter, a federal grand jury in the Southern District of Ohio indicted defendant on charges of mail fraud, in violation of 18 U.S.C. § 1341 (Counts One and Two); using fire to commit mail fraud, in violation of 18 U.S.C. § 844(h)(1) (Count Three); conspiring to use fire to commit mail fraud, contrary to 18 U.S.C. § 844(m) (Count Four);¹ and money-laundering, in violation of 18 U.S.C. § 1957 (Counts Five and Six). The indictment sought forfeiture of the insurance proceeds, as well as the real and personal property acquired with those proceeds.

Following a nearly three-week jury trial, defendant was convicted as charged on all counts. The district court originally sentenced defendant to 207 months of imprisonment; specifically, 60 months on Counts One and Two; 87 months on Counts Four, Five, and Six, to run concurrently to each other and to the sentences on Counts One and Two; and 120 months on Count Three, to be served consecutively. Defendant filed a timely notice of appeal and, while the appeal was pending, this court remanded for re-sentencing in light of the newly issued decision in United States v. Booker, 543 U.S. 220, 125 S.Ct. 738, 160 L.Ed.2d 621 (2005). Defendant was re-sentenced to a total of 156 months of imprisonment: concurrent sentences of 36 months on Counts One, Two, Four, Five, and Six, and a consecutive sentence of 120 months on Count Three. A final order of forfeiture was entered by the court. The amended judgment of conviction and sentence was entered on December 20, 2005, the same date on which defendant filed the present appeal.²

In his appeal, defendant challenges the sufficiency of the evidence and alleges, inter alia, that defects in the indictment and improper constructive amendments to it mandate reversal of his convictions. For the reasons set forth below, we affirm.

I.

Defendant first alleges numerous deficiencies in the indictment and maintains that the indictment was constructively amended through the jury instructions given by the district court. Defendant concedes that he did not raise these challenges below; thus, review is for plain error. FED. R. CRIM. P. 52(b); United States v. Cotton, 535 U.S. 625, 631-32, 122 S.Ct. 1781, 152 L.Ed.2d 860 (2002).

We review the sufficiency of an indictment de novo. An indictment is generally sufficient if it "fully, directly, and expressly ... set[s] forth all the elements necessary to constitute the offense intended to be punished." United States v. Douglas, 398 F.3d 407, 411 (6th Cir.2005) (internal citation and quotation marks omitted). In particular, the indictment must: (1) "set out all of the elements of the charge[d] offense and must give notice to the defendant of the charges he faces[,]" and (2) "be sufficiently specific to enable the defendant to plead double jeopardy in a subsequent proceeding, if charged with the same crime based on the same facts." Id. at 413 (internal citation omitted). "An indictment will usually be sufficient if it states the offense using the words of the statute itself, as long as the statute fully and unambiguously states all the elements of the offense." United States v. Superior Growers Supply, Inc., 982 F.2d 173, 176 (6th Cir.1992). However, the recitation of statutory language "`must be accompanied with such a statement of the facts and circumstances as will inform the accused of the specific offense, coming under the general description with which he is charged.'" Id. (quoting Hamling v. United States, 418 U.S. 87, 117-18, 94 S.Ct. 2887, 41 L.Ed.2d 590 (1974)).

The indictment must be read as a whole, accepting the factual allegations as true, and construing those allegations in a practical sense with all the necessary implications. United States v. Reed, 77 F.3d 139, 140 n. 1 (6th Cir.1996) (en banc). An indictment is to be construed liberally in favor of its sufficiency. United States v. Davis, 306 F.3d 398, 411 (6th Cir.2002).

Here, defendant contends that Counts One and Two of the indictment, which allege violations of the mail fraud statute, 18 U.S.C. § 1341, do not adequately set forth two of the requisite elements of that offense: (1) that defendant acted willfully with an intent to defraud, and (2) that a "material" misrepresentation was made.

The mail fraud statute prohibits the use of the mails by any person "having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises...." 18 U.S.C. § 1341. "Mail fraud consists of (1) a scheme or artifice to defraud; (2) use of mails in furtherance of the scheme; and (3) intent to deprive the victim of money or property." United States v. Turner, 465 F.3d 667, 680 (6th Cir.2006). Materiality of falsehood is a requisite element of mail fraud. Neder v. United States, 527 U.S. 1, 25, 119 S.Ct. 1827, 144 L.Ed.2d 35 (1999). The misrepresentation "must have the purpose of inducing the victim of the fraud to part with the property or undertake some action that he would not otherwise do absent the misrepresentation or omission." United States v. Daniel, 329 F.3d 480, 487 (6th Cir.2003). A misrepresentation "is material if it has a natural tendency to influence, or is capable of influencing, the decision of the decision-making body to which it was addressed." Neder, 527 U.S. at 16, 119 S.Ct. 1827 (internal citation and quotation marks omitted).

The requisite intent to defraud requires "an intent to deceive or cheat for the purpose of either causing a financial loss to another or bringing about a financial gain to oneself." Sixth Circuit Pattern Jury Instruction 10.01(2)(E); see also United States v. Frost, 125 F.3d 346, 371 (6th Cir.1997). With regard to both elements at issue, an indictment is not fatally insufficient for its failure to allege these elements in haec verba, if the facts alleged in the indictment warrant the inference of such elements, i.e., materiality and intent to defraud. United States v. McGough, 510 F.2d 598, 602 (5th Cir.1975) (materiality); United States v. Hoag, 823 F.2d 1123, 1126 (7th Cir.1987) (intent to defraud).

In this case, the indictment more than adequately alleges the elements of materiality and intent to defraud. Paragraph 1 of the indictment includes in the allegations the statutory language of § 1341. Paragraph 5 of the indictment alleges that defendant "falsely represented to Grange Insurance Company that the fire damage to the dwelling [at issue] and its contents was not caused by design or procurement on his part, though he then well knew otherwise." Paragraphs 6 and 7 similarly allege that defendant submitted two sworn proof of loss statements which "falsely represented" that the March 8, 2002, fire damage to the residence "had not been designed or procured by him . . . though he then well knew that his acts in planning and causing the fire damage eliminated his right to payment under the insurance policy." Certainly these allegations, that defendant's representation that the cause of the fire damage was unknown to him, related to a matter that had a "tendency" to influence Grange's decision to settle his claim. The indictment alleges that defendant made these misrepresentations "well knowing" that his role in the scheme barred his right to recover the insurance proceeds.

In addressing a similar claim involving the analogous bank fraud statute,³ 18 U.S.C. § 1344, the Second Circuit Court of Appeals, in United States v. Klein, 476 F.3d 111 (2d Cir.2007), recently held:

It is true that a bank fraud conviction requires a showing that the fraudulent conduct was material, Neder v. United States, 527 U.S. 1, 25, 119 S.Ct. 1827, 144 L.Ed.2d 35 (1999), although the bank fraud statute does not contain that actual word. 18 U.S.C. § 1344. In Neder, the Supreme Court held that materiality was an element of bank fraud because the word fraud incorporated fraud's "well-settled meaning at common law"—a "misrepresentation or concealment of material fact." Id. at 22, 119 S.Ct. 1827. Appellant claims, therefore, that the indictment is insufficient because it does not explicitly use the word "material." Appellant did not raise this issue in the district court, and thus we review only for plain error. United States v. Acosta, 470 F.3d 132, 135 (2d...