U.S. v. Waldner

• Citation: 580 F.3d 699
• Decision Date: 04 September 2009
• Docket Number: No. 08-2606.,08-2606.
• Parties: UNITED STATES of America, Appellee, v. Roger WALDNER, Appellant.
• Court: United States Courts of Appeals. United States Court of Appeals (8th Circuit)

580 F.3d 699

UNITED STATES of America, Appellee, v. Roger WALDNER, Appellant.

No. 08-2606.

United States Court of Appeals, Eighth Circuit.

Submitted: December 9, 2008.

Filed: September 4, 2009.

Richard O. McConville, argued, West Des Moines, IA, for appellant.

Charles J. Williams, A.U.S.A., argued, Cedar Rapids, IA, for appellee.

Before COLLOTON, BRIGHT, and SHEPHERD, Circuit Judges.

SHEPHERD, Circuit Judge.

Roger Waldner pled guilty to two counts of making a false statement in relation to a bankruptcy proceeding, in violation of 18 U.S.C. § 152(3). The district court¹ sentenced Waldner to 120 months imprisonment and ordered him to make restitution in the amount of $1,722,717.61. He appeals both his sentence and the restitution order. We affirm.

I.

In January 2001, Roger Waldner took control of H & W Motor Express ("H & W"), a trucking company in Dubuque, Iowa. Waldner obtained all of H & W's stock in exchange for his assumption of H & W's corporate debt. Waldner became CEO of H & W, participating in the daily management of the company and assuming control of its financial operations.

Within a few months of assuming control of H & W, Waldner and his associates began transferring approximately $1.8 million worth of assets from H & W to four other corporations with which he had a close relationship—Equity Holdings, Inc. ("EHI"), STRAC, Inc. ("STRAC"), Nationwide Cartage ("Nationwide"), and Solace Transfer ("Solace"). Waldner and his associates formed EHI and STRAC as holding companies for the purpose of acquiring other trucking businesses. Waldner was the president, secretary, treasurer, and sole director of EHI, and, for a time, EHI held Waldner's H & W stock. EHI shared the same address with H & W's headquarters in Dubuque, Iowa. In May 2001, after Waldner had already acquired H & W, H & W's board authorized Waldner to pay EHI $100,000 for "consulting/legal fees" regarding the acquisition of H & W. Waldner and Galley Smith, an officer and board member of H & W, were among those who signed the authorization for the payment to EHI.

Waldner was never listed as owner, officer, or director of STRAC, but he was present during the H & W board meeting at which the board approved the formation of STRAC for the purpose of acquiring non-union trucking companies.² The H & W board then issued a resolution, signed by Waldner, authorizing a payment of $100,000 to STRAC to perform a "feasability study" for acquiring Midland Transportation ("Midland"), a financially troubled trucking company. However, none of this amount was paid to STRAC before it acquired Midland.

Midland subsequently failed, and Waldner used its employees and trucking contracts to form Nationwide on August 10, 2001. Waldner became CEO of Nationwide. Nationwide's address was the same as H & W's address in Dubuque, Iowa, and H & W's employees performed all of Nationwide's billing and payroll services. Nationwide performed hauling services for H & W, the revenue from which was paid to H & W and then transferred to Nationwide. According to one of Nationwide's truck drivers, William Utley, Nationwide earned, at most, $1,500 a week from H & W, which would amount to approximately $36,000 in total payments before H & W filed for bankruptcy in June 2002. However, H & W paid $459,744.56 to Nationwide during this period. H & W's accounts payable clerk, Gregory Wolfe, stated he never saw any invoices that would justify these payments.

Waldner and his wife owned a holding company called One Stop, Inc. ("One Stop"). One Stop also shared the same address as H & W in Dubuque, Iowa. In December 2001, One Stop acquired Solace, which, like Midland, was a financially troubled trucking company. Waldner was the CEO of Solace, and Galley Smith became its president. Solace did not perform any hauling services for H & W until May 2002. These services were estimated to be worth less than $10,000. However, H & W made net payments of $1,262,973.05 to Solace before H & W filed for bankruptcy. As with the payments to Nationwide, H & W's accounts payable clerk stated that he knew of no invoices that would explain these payments. In 2002, Waldner sold Solace for $1.1 million.

H & W filed for bankruptcy in June 2002. Attorney Frank Baron was hired to perform the legal work for H & W's bankruptcy. Baron was paid for his services by Solace. After H & W filed for bankruptcy, Waldner met with Baron, Galley Smith, and a man named Brad Hartke, who had been hired to draft H & W's bankruptcy schedules. According to Hartke, when he expressed concern over the fact that the payments to Solace and Nationwide had not been included on the bankruptcy schedules, Baron suggested that Hartke and Smith leave the meeting. When Hartke and Smith returned, the schedules were completed without disclosures of the payments to Nationwide or Solace. Although Smith stated that he did not recall discussing anything about the disclosures at this meeting, he did recall being asked to leave with Hartke. Waldner later claimed that he signed blank bankruptcy schedules and that someone else completed them. However, Baron testified that he never gave Waldner blank schedules to sign, and Hartke stated that he witnessed Waldner sign the completed schedules.

Shortly after the filing of the bankruptcy schedules, Waldner appeared at a Section 341 "meeting of creditors" as owner and CEO of H & W to answer questions under oath about the company's bankruptcy.³ At this meeting, Waldner stated that Solace had no relation to H & W, that he did not know anything about STRAC, that he had no ownership or affiliation with Nationwide, and that he was not aware of any common officers among Solace, Nationwide, and H & W.

In May 2006, Waldner was indicted on 12 counts of knowingly and fraudulently making a false statement under penalty of perjury in relation to a bankruptcy proceeding, in violation of 18 U.S.C. § 152(3). On May 18, 2007, immediately after a jury was selected for his trial, Waldner pled guilty to counts 11 and 12 of the indictment. The counts concerned his denials, made at the Section 341 meeting. One denial was of his ownership and affiliation with Nationwide, the other was a denial of any knowledge of common officers among Solace, Nationwide, and H & W. Pursuant to his plea agreement, Waldner stipulated to a number of facts, including stipulations that he signed the completed bankruptcy schedules and that he made fraudulent statements at the Section 341 meeting about the relationship between Solace, Nationwide, and H & W to prevent creditors from reaching the assets transferred from H & W to Solace and Nationwide. In exchange, the remaining ten counts were dismissed.

In preparation for sentencing, the government investigated Waldner's involvement in a number of transactions that suggested the criminal character of his enterprise. In particular, the government questioned Waldner about the purchase of a ring for approximately $5,000, using a Solace check made payable to "McCoy Repair," a non-existent company. The ring was purchased from McCoy Jewelers, a jewelry store in Dubuque, Iowa. Although Waldner claimed that the ring was a gift and he knew nothing of why a Solace check was used to pay for it, the jeweler who made the ring later testified at the sentencing hearing that he had made the ring at Waldner's request. Furthermore, Smith testified that Waldner instructed him to use a check drawn on Solace's funds to pay the fictitious McCoy Repair.

Similarly, the government questioned Waldner about the sale of two truckloads of H & W's equipment after the filing of the bankruptcy petition. The sale was to a Minnesota company named Thompson Motors and was for $17,000. Waldner had instructed Thompson Motors to make two payments in the amount of $8,500 to Sioux Falls Cartage, a defunct company previously owned by Waldner. In an apparent effort to distance himself from this transaction before sentencing, Waldner produced invoices regarding the sale purporting to be from Sioux Falls Cartage and faxed by a man named Greg Hohnecker, who was a supervising mechanic at H & W's garage. However, Hohnecker subsequently testified that he never worked for Sioux Falls Cartage and that he had never seen the documents purporting to be invoices for the sale of H & W equipment to Thompson Motors.⁴

During the three-and-a-half-day sentencing hearing, Waldner produced three witnesses on his behalf: Lois Lex, a secretary at H & W; Linda Schueller, a former H & W employee; and Larry Eide, a lawyer who served as trustee for H & W's bankruptcy estate. Lex claimed to have loaned Waldner $700,000, even though she never earned more than $30,000 a year, owed $60,000 on her mortgage, and owned no stock or other investments. Lex also testified that Waldner's subordinates, especially Galley Smith, were responsible for the suspicious transactions and that, in her opinion, Waldner did not know anything about STRAC. Schueller, who has no training in accounting, attested to the legitimacy of H & W's transactions and minimized Waldner's role in the company's financial operations. Eide had originally accused Waldner of secreting away $1.5 million of H & W's assets, and brought an action against Waldner, Waldner's wife, and One Stop to recover the funds. However, Eide then proposed a settlement agreement in which Lex would pay H & W's bankruptcy estate $5,000. In exchange, the estate would hire the law firm that represented Waldner to recover funds for the bankruptcy estate. After their recovery, 80 percent of the funds would be paid to Lex and the law firm. Eide testified at Waldner's sentencing hearing that an unspecified amount of money had come back into H & W's accounts. The district court did not find Lex, Schueller, or Eide to be credible.

At the conclusion of the sentencing hearing, the district court made a number of sentencing determinations. First, the court determined Waldner's base offense level to be six under United States...