U.S. v. Vavlitis

• Decision Date: 04 October 1993
• Docket Number: No. 93-1229,93-1229
• Citation: 9 F.3d 206
• Parties: UNITED STATES, Appellee, v. Stelios M. VAVLITIS, Defendant, Appellant. . Heard
• Court: U.S. Court of Appeals — First Circuit

Page 206

9 F.3d 206

UNITED STATES, Appellee, v. Stelios M. VAVLITIS, Defendant, Appellant.

No. 93-1229.

United States Court of Appeals First Circuit.

Heard Oct. 4, 1993.

Decided Nov. 19, 1993.

Robert A. George, Boston, MA, on brief, for defendant, appellant.

Jonathan L. Kotlier, Asst. U.S. Atty., and A. John Pappalardo, U.S. Atty., Boston, MA, on brief, for appellee.

Before BREYER, Chief Judge, TORRUELLA, Circuit Judge, and BOWNES, Senior Circuit Judge.

BOWNES, Senior Circuit Judge.

Defendant-appellant, Stelios M. Vavlitis, was convicted of bank fraud, 18 U.S.C. Sec. 1344(1), for kiting checks and withdrawing money from accounts bearing insufficient funds. We consider on appeal whether the district court erred by dismissing midtrial the superseding indictment on which Vavlitis had not been arraigned, and by allowing the trial to continue on the original indictment. We also must determine whether the jury instruction on reasonable doubt was erroneous, and whether there was sufficient proof of fraudulent intent. We affirm.

I. BACKGROUND

In January 1990, Vavlitis maintained seven checking accounts, including six commercial accounts and one personal account, at two federally-insured banks, Atlantic Bank and Trust Company (Atlantic Bank) and Bank of New England. Four of the accounts were with Atlantic Bank; Bank of New England held the remainder. Vavlitis was an authorized signatory on each of these accounts. Atlantic Bank's practice at all relevant times was to credit Vavlitis's accounts with funds equal to the face value of the checks he deposited, without a delay to verify that these checks would be honored by the banks on which they were drawn. This practice created a "float," a period of one or more days that would pass before a deposited check credited to an account would be processed and presented for payment from the account of the check writer--Vavlitis.

From January 1990 until May 1990 when the banks froze his accounts, Vavlitis used the float to buoy up the balances in his accounts by exchanging checks drawn on insufficient funds between Atlantic Bank and Bank of New England. He withdrew money and wrote checks to third parties against funds he did not actually have, despite his inflated balances. The result was that when his four Atlantic Bank accounts were frozen on May 14, 1990, there was a total overdraft of $1,615,968.92. When Bank of New England, suspecting check kiting, closed Vavlitis's three accounts in May 1990, there was a combined positive balance of $683,292.63.

On February 19, 1991, a grand jury returned an indictment charging Vavlitis with one count of bank fraud. The indictment alleged that between January and May 1990, Vavlitis orchestrated a check kiting scheme by depositing checks written on insufficient funds into the accounts he controlled at Atlantic Bank and Bank of New England. The charging paragraph of the indictment, paragraph seven, alleged that this scheme allowed Vavlitis to obtain "$1,615,968.00, more or less, owned by and under the custody and control of Atlantic Bank and Bank of New England." Paragraph nine alleged that as a result of the check kiting scheme, "Atlantic Bank suffered a loss of $1,615,968.00 more or less, minus $638,315.00 in funds recouped from the Bank of New England checking accounts maintained by defendant STELIOS M. VAVLITIS, for a net ultimate loss of $932,653.00, more or less." (Emphasis added.) Vavlitis was arraigned on this indictment on March 5, 1991.

On March 12, 1991, the grand jury returned a superseding indictment, identical in all respects to the original indictment, except for paragraph nine. Paragraph nine of the superseding indictment stated that as a result of the check kiting scheme, "Atlantic Bank suffered a loss of $1,615,968.00 more or less." The superseding indictment thus alleged the total loss resulting from the scheme, but did not describe the "net ultimate loss." Because of an oversight by the prosecutor, Vavlitis was never arraigned on the superseding indictment.

In her opening statement in Vavlitis's trial on November 30, 1992, the prosecutor referred to the indictment and stated that Vavlitis "left the banks with the $1.6 million loss." She did not use the term "superseding indictment." Defense counsel moved for a mistrial claiming that he had no notice of the superseding indictment, ¹ and that his client had not been arraigned on it. The trial court denied the motion, pending further inquiry, and allowed the prosecution to call four witnesses from the two banks.

After the first day of trial, the court found that Vavlitis had not been arraigned on the superseding indictment. The court granted the prosecution's motion to dismiss the superseding indictment and allowed the trial to continue on the original indictment. Defense counsel's renewed motion for mistrial and motion for dismissal were denied. The trial court subsequently denied a motion for judgment of acquittal, and the jury found Vavlitis guilty of bank fraud.

II.

A. Dismissal of Indictment, Double Jeopardy, Variance, and Constructive Amendment

Vavlitis argues that the midtrial dismissal of the superseding indictment prevented any further prosecution on the original indictment, and that the continuation of the trial on the original indictment violated the Double Jeopardy Clause. We disagree.

It is clear that the grand jury's return of a superseding indictment does not void the original indictment. See United States v. Friedman, 649 F.2d 199, 202 (3d Cir.1981); United States v. Holm, 550 F.2d 568, 569 (9th Cir.), cert. denied, 434 U.S. 856, 98 S.Ct. 176, 54 L.Ed.2d 127 (1977). A defendant may use the Double Jeopardy Clause to prevent reprosecution following an acquittal or conviction on a superseding indictment, but may not rely on the notion that a superseding indictment instantaneously nullifies the original indictment. See United States v. Bowen, 946 F.2d 734, 736 (10th Cir.1991) (finding "no authority which supports ... that a superseding indictment zaps an earlier indictment to the end that the earlier indictment somehow vanishes into thin air"). Both indictments in this case remained valid until the district court granted the government's motion to dismiss the superseding indictment.

Vavlitis also contends that the midtrial dismissal of the superseding indictment prevented further prosecution for the same offense charged in the original indictment. The aspect of the Double Jeopardy Clause at issue in Vavlitis's assertion is the protection against reprosecution following a favorable termination of proceedings midtrial. The "historical" underpinning of the double jeopardy prohibition is that

"the State with all its resources and power should not be allowed to make repeated attempts to convict an individual for an alleged offense, thereby subjecting him to embarrassment, expense and ordeal and compelling him to live in a continuing state of anxiety and insecurity, as well as enhancing the possibility that even though innocent he may be found guilty."

United States v. Scott, 437 U.S. 82, 87, 98 S.Ct. 2187, 2192, 57 L.Ed.2d 65 (1978) (quoting Green v. United States, 355 U.S. 184, 187-88, 78 S.Ct. 221, 223, 2 L.Ed.2d 199 (1957)). One purpose of the prohibition on reprosecution following a midtrial ruling that ends the case is to protect the "valued right of a defendant to have his [or her] trial completed" by a particular tribunal. Id., 437 U.S. at 92, 98 S.Ct. at 2194; United States v. Govro, 833 F.2d 135, 137 (9th Cir.1987); United States ex rel. Young v. Lane, 768 F.2d 834, 838 (7th Cir.), cert. denied, 474 U.S. 951, 106 S.Ct. 317, 88 L.Ed.2d 300 (1985).

Given these principles, we find no merit in Vavlitis's double jeopardy argument. First, Vavlitis fails to show a second attachment of jeopardy. Jeopardy attached when the jury was impanelled for the bank fraud prosecution. See Crist v. Bretz, 437 U.S. 28, 37-38, 98 S.Ct. 2156, 2161-62, 57 L.Ed.2d 24 (1978). There was no impanelment of a second jury and no second verdict, thus no relinquishment of the valued right to a particular tribunal, no enhancement of the risk of an erroneous verdict, and none of the expense or the ordeal of a subsequent prosecution.

Even if we assume that the further prosecution of Vavlitis on the original indictment following the dismissal of the superseding indictment constituted a reattachment of jeopardy, we would not find a double jeopardy violation. The district court dismissed the superseding indictment without resolving any factual issue in favor of the accused. Although the trial could have proceeded on the superseding indictment, see United States v. Boruff, 909 F.2d 111, 118 (5th Cir.1990), cert. denied, 499 U.S. 975, 111 S.Ct. 1620, 113 L.Ed.2d 718 (1991); see also Garland v. Washington, 232 U.S. 642, 644-46, 34 S.Ct. 456, 456-57, 58 L.Ed. 772 (1914) (affirming conviction despite lack of arraignment because accused, who had notice of charges and adequate opportunity to prepare defense, was not deprived of any substantial right), the court dismissed the superseding indictment so that Vavlitis would be tried on the indictment on which he had been arraigned. We note that if the trial court had dismissed the case, as Vavlitis requested, the government could have appealed such a ruling without violating the Double Jeopardy Clause. See Scott, 437 U.S. at 98-99, 98 S.Ct. at 2197-98 (holding that defendant who obtained dismissal of proceedings on grounds unrelated to factual guilt or innocence suffers no injury under Double Jeopardy Clause if government appeals). A fortiori, the continuation of the prosecution before the same fact-finder did not violate the double jeopardy prohibition.

Vavlitis's next argument is that the indictments contained materially different allegations, so that a variance of proof and an improper amendment of the charges resulted from the midtrial substitution, and that this unfairly prejudiced the defense. We note that defense counsel...