U.S. v. White
| Decision Date | 19 December 2006 |
| Docket Number | No. 06-1769.,06-1769. |
| Citation | 472 F.3d 458 |
| Parties | UNITED STATES of America, Plaintiff-Appellee, v. Robert WHITE, Defendant-Appellant. |
| Court | U.S. Court of Appeals — Seventh Circuit |
Bernard Van Wormer (argued), Office of the United States Attorney, Hammond, IN, for Plaintiff-Appellee.
John L. Kelly, Jr. (argued), Merrillville, IN, Frederick T. Work, Gary, IN, for Defendant-Appellant.
Before EASTERBROOK, Chief Judge, and KANNE and SYKES, Circuit Judges.
The defendant appeals a conviction for multiple counts of mail fraud, wire fraud, and money laundering. The underlying fraud alleged in the indictment was a failure to disclose a potential conflict of interest while serving as an elected public servant in Gary, Indiana. The defendant argues on appeal that the district court erred by preventing the defense from presenting its theory of the case to the jury and by committing various sentencing errors. Because we find no error, we affirm.
At its heart, this case is about a corrupt politician who got caught with his hand in the cookie jar. Robert White was an elected official in Gary, Indiana, serving on the city's Common Council. In the Summer of 2003 there was a drowning in Gary at the beach where Lake Street arrives at the Lake Michigan shore. Sometime shortly thereafter, White met with Gary's Superintendent of Parks and the conversation turned to the need to construct a fence to prevent children from unauthorized access to the beach in that area. The drowning, along with the apparent ease with which children were able to walk from a nearby school to the shore, made the project a prime candidate for an emergency contract—that is, a contract that would not be subject to competitive bidding or other inconvenient scrutiny.
Fortunately for the City of Gary, White knew just the builder for the job: a small minority-owned company called Raycor. Unfortunately for the City of Gary, this was all a shell game. Unbeknownst to the city, Raycor was actually owned and operated by White's nephew. The $30,000 emergency fence contract was let to Raycor. The actual fence builder, a subcontractor from across the border in Illinois, received a mere $5,000 of the contract amount for doing all of the work. The remaining $25,000 of profit was routed through White's nephew and eventually back into White's bank account.
The government indicted White for numerous counts of wire and mail fraud as well as money laundering. The underlying conduct that the government alleged to be fraudulent was White's depriving the citizens of Gary of his honest services. Specifically, the government alleged that Indiana law required a public servant such as White to either refrain from deriving a profit from contracts with the City of Gary, or to disclose the details of the conflict of interest. See Ind.Code § 35-44-1-3. The government's theory was that White owed a duty of honest services to Gary, that he defrauded Gary of his honest services, and that he used interstate wires, banks, and mail to accomplish that fraud.
White had stipulated that he did not file a conflict of interest disclosure. The defense centered around an argument that White had not owed a duty of honest services to the Park District, which was the actual government entity that let the contract. In an apparent effort to insulate the Park District from partisan politics, the department is distinct from the city in various ways. Testimony at trial included the following examples: the Park District is overseen by a bipartisan board of commissioners who are appointed by the mayor; the district is a special taxing district; in theory it has the ability to raise money either through taxes or by issuing bonds; it sets all policies for Gary parks; and it has the authority to hire and fire all Park District employees except for the supervisor of parks.
To support this theory of the defense, White sought a jury instruction that would have reprinted, verbatim, Indiana's definition of "governmental entity," which includes not only cities such as Gary but also special taxing districts, boards, bureaus, commissions, committees, departments, divisions, military units, and others. See Ind.Code § 35-41-1-12. The government objected to the proposed jury instruction on the grounds that the indictment only mentioned one government entity, the City of Gary, and that the indictment alleged that White had breached a duty to "the city of Gary and its citizens." In the government's view, reading the entirety of the Indiana Code might have confused the jury.
The district court declined to give the proposed jury instruction but told defense counsel that he could still make the argument that White's role as Common Councilman was sufficiently disconnected from the actual Park District decision makers. During White's closing argument he made that argument. However, when White's counsel then attempted to read the statute (the same statute that the district court had just decided not to include as a jury instruction) the court sustained a government objection and prevented him from reciting it. White now appeals the exclusion of his proposed jury instruction and the refusal to let him read the statute to the jury.
The jury returned a verdict of guilty on all counts, and the court sentenced White to 63 months' imprisonment and restitution in the amount of $30,000. On appeal, White argues that various sentencing enhancements were either unconstitutional or improper. He argues that the district court's findings of a leadership role in the crime, obstruction of justice, and an amount of loss in excess of $10,000 were made in violation of the Sixth Amendment. He argues that a sentencing enhancement for being an elected public official was an error.
We review jury instructions as a whole to determine whether they fairly and adequately represent the issues to the jury. See United States v. Alhalabi, 443 F.3d 605, 612 (7th Cir.2006). We review a district court's decision to not instruct the jury on a theory of defense de novo. United States v. Hendricks, 319 F.3d 993, 1005 (7th Cir.2003). A defendant is entitled to an instruction on his theory of the defense if four conditions are met. Id. at 1005-06. Only two of those four conditions are relevant here: the instruction must reflect a theory that is supported by the evidence and failing to include the instruction must deny the defendant a fair trial. Id. at 1006. As we set out below, neither of these two prerequisites are met, and the failure to include White's proffered instruction was not an error.
Under Indiana's conflict of interest laws, it is a felony if a "public servant ... knowingly or intentionally: (1) has a pecuniary interest in; or (2) derives a profit from; a contract or purchase connected with an action by the government entity served by the public servant." Ind.Code § 35-44-1-3. A government servant can escape this by filing a conflict of interest disclosure. Ind.Code § 35-44-1-3(c). There is no dispute between the parties that White was a public servant of the City of Gary within the meaning of the statute. Nor is there any dispute that the City of Gary is a government entity. For that matter, there is no dispute on appeal that he had a pecuniary interest in or derived a profit from the contract.
The only significant dispute is whether the contract was "connected with an action by the governmental entity served by" White. It is White's theory of the case that the Park District is a separate governmental entity from the City of Gary and that the contract in question was between Raycor and the Park District—not between Raycor and the City of Gary. To that end, he wanted the jury instructions to include the entire definition of "government entity" so that the jury would be informed that the Park District is also a government entity.
At the outset, we should note that we are dubious that the rote recitation of a statute can be construed as a "theory of defense" under Hendricks. Assuming for the moment that cutting and pasting the statute would have constituted a theory, White's argument is still wide of the mark. It is logically flawed because it presupposes that a contract can only be "connected to" one government entity—that by being connected to the Park District the contract could not possibly have been connected to the City of Gary as a whole. There is no doubt that the fence contract in question was connected to the Park District; nor is there a dispute that White was not a public servant of the Park District. But neither of those facts is relevant to whether the contract was also connected to the City of Gary. This connection to the City of Gary was the only connection alleged in the indictment. In this sense, the jury instruction that White offered, even if it were construed as a theory, does not reflect a theory that has any evidentiary support because it is entirely non-responsive to the conduct that was alleged in the indictment.
White also fails to demonstrate how the exclusion of the instruction resulted in a denial of a fair trial. White was free to base his defense on the argument that there were numerous ways that the Park District and the Raycor contract were independent of the City of Gary. The district court did not prevent him from making any of those arguments. Unfortunately for White, the government also provided evidence that would allow a jury to find that the Raycor contract was connected to the City of Gary. All of that evidence was relevant to the question of whether White defrauded the City of Gary of his honest services. What would not have been relevant would have been to instruct the jury on any of a number of other government entities that were not defrauded by White.
Given the conduct alleged in the indictment and the issues that were contended between the parties, we...
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