U.S. v. Weidman

• Decision Date: 31 March 1978
• Docket Number: No. 76-1110,76-1110
• Citation: 572 F.2d 1199
• Parties: 3 Fed. R. Evid. Serv. 75 UNITED STATES of America, Appellee, v. John H. WEIDMAN, Jr., Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 1199

572 F.2d 1199

3 Fed. R. Evid. Serv. 75

UNITED STATES of America, Appellee, v. John H. WEIDMAN, Jr., Appellant.

No. 76-1110.

United States Court of Appeals Seventh Circuit.

Argued Oct. 31, 1977.

Decided March 31, 1978.

Robert B. Barnett, Harold Ungar, Aubrey M. Daniel, III and Edward B. Williams, Washington, D. C., Myron J. Hack, South Bend, Ind., for appellant.

Richard L. Kieser, U. S. Atty., South Bend, Ind., Frank J. Gray, Asst. U. S. Atty., Fort Wayne, Ind., Carmen M. Piasecki, Asst. U. S. Atty., Hammond, Ind., for appellee.

Before SPRECHER, BAUER, Circuit Judges, and CAMPBELL, Senior District Judge. ^*

BAUER, Circuit Judge.

On November 21, 1974, John H. Weidman, Jr., and twenty-one other individuals were indicted on thirty-two counts of mail fraud, four counts of perjury and one count of conspiracy. The indictment alleged that Weidman and other supervisory officials of the Walsh Construction Company had defrauded both Walsh and the Bethlehem Steel Corporation at a major steel mill construction project in Burns Harbor, Indiana. More specifically, the named individuals were charged with obtaining money, goods and services for their own benefit through fictitious work orders, false invoices, fraudulent purchase orders and inflated labor and equipment charges.

Through a variety of plea agreements, the indictment was dismissed as to twenty of the defendants, leaving only Weidman (the president of Walsh) and Thomas J. McGrath (a Walsh vice president) to stand trial. While McGrath was ultimately acquitted, Weidman was found guilty of fourteen counts of mail fraud and one count of conspiracy. From this conviction, and the lower court's subsequent denial of his motion for a new trial, Weidman now appeals.

I.

In the first of his two principal arguments on appeal, Weidman claims that the lower court improperly admitted evidence on the earlier schemes of Walsh supervisory officials schemes which, in their essential details, bore a close resemblance to the alleged mail fraud offense at Burns Harbor. ¹ It is Weidman's contention that this testimony had no evidentiary value, was highly prejudicial, and thus was not properly admissible as evidence of "prior similar acts."

In considering the claim, we begin by noting that evidence of prior similar acts cannot be used to show that the accused, by virtue of his character, was predisposed to commit the crime with which he is charged. But prior similar acts may be used to show "motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or accident." Fed.R.Evid. 404(b). Thus, this Court has held that evidence of similar acts is properly admissible for any of these purposes "unless its probative value is outweighed by its prejudicial effect." United States v. Fearns, 501 F.2d 486, 491 (7th Cir. 1974). "And the balancing of probative value against prejudice is, in the first instance, left to the sound discretion of the trial judge." United States v. Jones, 438 F.2d 461, 465 (7th Cir. 1971).

The appellant argues, however, that the element of intent was merely a "formal issue" in the proceedings below. Emphasizing that his defense was based not on a claim of "accident" or "mistake" but on the broad denial that he had committed the charged acts, he insists that there was in fact no contest as to his state of mind. Therefore, he concludes, there was no evidentiary need for the testimony on prior similar acts which could justify its prejudicial effect.

To support his claim, Weidman relies heavily on United States v. Fierson, 419 F.2d 1020 (7th Cir. 1969). The crux of the Fierson decision lay in its holding that evidence of prior similar acts should not be admitted "to show willfulness and intent when . . . the accused does not, except for demanding an instruction on the requisite willfulness and intent, otherwise put that issue in dispute." Id. at 1023. The facts of the case, according to the Court,

"did not raise even the slightest suggestion that Fierson did the physical act charged but without the requisite willfulness and intent. There was no suggestion of accident or mistake. The defendant simply said he did not commit the physical act charged. . . . If the defendant had admitted the above acts but defended on the theory that he was joking and really did not mean it, then the matter of his intent might be said to be in issue . . . . But here the issue of willfulness and intent was not sharpened; it was not really in dispute."

Id. at 1023. Thus, concluding that the probative value of the similar act evidence could not outweigh the risk of prejudice, the Court found the admission of the evidence to be reversible error.

In the case at hand, however, the Government had a substantial need to produce evidence of Weidman's intent even though he had not "sharpened" the issue by claiming accident or mistake. For an essential element of the mail fraud offense an element that the Government must prove beyond a reasonable doubt is the defendant's specific intent to defraud. Thus, this Court has held that evidence of prior similar acts is "particularly appropriate where, as with mail fraud, criminal intent is an essential element of the crime charged." United States v. Hutul, 416 F.2d 607, 624 (7th Cir. 1969). In United States v. Marine, we noted that

"proof of specific intent to defraud is an essential element of the offense here involved and . . . the Government (has) the burden of proving such specific intent beyond a reasonable doubt regardless of whether or not defendant, in his opening statement, asserted his innocence or culpability as to that issue."

413 F.2d 214, 216 (7th Cir. 1969).

So quite apart from the nature of Weidman's defense there was, on the issue of intent, a substantial need for the government's evidence on prior similar acts. But this was not the only ground on which the testimony was relevant; it also furnished evidence of a pre-existing design or scheme. ² And the use of prior similar acts for this purpose is appropriate whenever the accused denies the very doing of the act charged:

"When the very doing of the act charged is still to be proved, one of the evidential facts receivable is the person's design or plan to do it. This in turn may be evidenced by conduct of sundry sorts as well as by direct assertions of the design . . . . The object here is not merely to negative an innocent intent at the time of the act charged, but to prove a pre-existing design system, plan or scheme, directed forward to the doing of that act."

2 Wigmore, Evidence § 304 at 202. See also United States v. Fearns, supra at 419. Thus, by showing that the earlier schemes "bore a singular strong resemblance to the pattern of the offense charged," United States v. Jones, 438 F.2d 461, 466 (7th Cir. 1971), the government established a pre-existing plan or design which, in turn, tended to show "the doing of the act designed." Wigmore, supra at 202.

In this connection, however, the appellant makes one additional claim, namely, that the similar act evidence was not properly admissible against him since there was no convincing proof that he was actively involved in all of the other fraudulent activities. At the very least, however, the Government's evidence did indicate that Weidman was well aware of the earlier schemes in all of their particulars; ³ and it is this element of knowledge that establishes the relevancy of the similar act evidence. ⁴ The purpose of such evidence, after all, at least on the issue of a pre-existing plan or scheme, is simply "to fix a design upon the defendant, as making it likely that he carried it out . . . ." Wigmore, supra at 204-205. This purpose was realized, it seems clear, when the Government showed that Weidman, by virtue of his knowledge of, or involvement in, the earlier schemes, was well acquainted with the modus operandi employed in the alleged mail fraud offense at Burns Harbor. By the same token, Weidman's knowledge of the earlier schemes served as the basis for their relevancy on the issue of intent.

We conclude, then, that on several grounds intent, knowledge, design there was substantial value in the testimony on other fraudulent activities involving Walsh supervisory officials. In this light, we cannot agree that the lower court abused its discretion in determining that the probative value of the evidence outweighed its prejudicial effect.

II.

In the second of his two major arguments on appeal, Weidman insists that the district court erred in denying his motion for a new trial. This motion was based on a claim that he had been unfairly prejudiced by the Government's failure to provide information on Walter B. Cox, a major witness at trial and a central figure in the mail fraud scheme. More specifically, according to Weidman, the prosecution improperly withheld information on (1) discussions that were held in 1972 between Cox and the Government on a possible grant of full immunity; (2) the Government's alleged agreement to recommend that Cox not be fined for filing a false income tax return; and (3) Cox's alleged attempt to bribe an NLRB official. Following an evidentiary hearing on August 31, 1976, the district court found that none of the three "nondisclosures" operated to deprive the defendant of a fair trial. The lower court erred, Weidman now argues, on all three points.

The basis for Weidman's claim is found in the prosecution's constitutional obligation to disclose evidence in its possession that would be material to the defense of the accused. This obligation was firmly established by the Supreme Court's decision in Brady v. Maryland, 373 U.S. 83, 83 S.Ct. 1194, 10 L.Ed.2d 215 (1963). But it was not until United States v. Agurs, 427 U.S. 97, 96 S.Ct. 2292, 49 L.Ed.2d 342 (1976), that the Court identified the criteria to be used in determining whether evidence is sufficiently "material" to make its nondisclosure a constitutional error. The standard of materiality, according to ...