U.S. v. Widgery, 80-1385

• Citation: 636 F.2d 200
• Decision Date: 05 December 1980
• Docket Number: No. 80-1385,80-1385
• Parties: UNITED STATES of America, Appellee, v. William Arthur WIDGERY, Appellant.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 200

636 F.2d 200

UNITED STATES of America, Appellee, v. William Arthur WIDGERY, Appellant.

No. 80-1385.

United States Court of Appeals,

Eighth Circuit.

Submitted Oct. 17, 1980.

Decided Dec. 5, 1980.

David W. Russell, Gladstone, Mo., for appellant; Robert G. Duncan, Gladstone, Mo., on brief.

Ronald S. Reed, Jr., U. S. Atty., Kansas City, Mo., for appellee.

Before LAY, Chief Judge, BRIGHT and McMILLIAN, Circuit Judges.

BRIGHT, Circuit Judge.

Widgery was charged in a twenty-eight count indictment with mail fraud and wire fraud, in violation of 18 U.S.C. §§ 1341 and 1343 (1976). A jury found Widgery guilty of counts I through X of the indictment. The district court sentenced him to five years on each of the ten counts, the sentences to run concurrently, and fined him $500 on each count. On appeal Widgery contends that 1) the Government's evidence failed to establish a scheme to defraud and the requisite use of the mails and wire communications in furtherance of the alleged scheme and 2) the district court erred in refusing to grant a mistrial on grounds of jury bias and the extensive time taken for jury deliberations. We set aside his conviction on counts V and X and affirm on the remaining counts.

I. The Charges.

William Arthur Widgery, a self-proclaimed business consultant who could "turn failing businesses around," entered into an agreement with Robo Wash, Inc., a Missouri manufacturer of automatic car wash equipment on February 4, 1977. The agreement called for Robo to transfer 625,000 shares of "lettered" common stock to Widgery if he provided operational and administrative assistance, engaged in promotional and sales activities, and produced $135,000 in before-tax net income prior to October 1, 1977. The resultant mail and wire fraud counts upon which the Government obtained a conviction relate to alleged fraudulent orders for car wash equipment placed with Robo by Widgery.

In August 1977, Widgery and his associate, Harvey Jefferson, induced Haskell Stone, a building inspector for the City of Indianapolis, to sign a purchase order for car wash equipment, knowing that Stone owned no assets justifying an extension of credit for such a purchase. To fund this purchase order, Widgery, on behalf of Stone, applied for a Small Business Administration (SBA) loan. The Government charged that Widgery, knowing that Stone possessed no assets, filled out this loan application to falsely show that Stone owned real estate and other assets. ¹ Widgery thereafter influenced George Hunter, Assistant Director of the SBA in Indianapolis, to issue an "Authorization and Loan Agreement" indicating approval of a $112,000 interim loan. ² Widgery's mailing of the Stone purchase order to Robo forms the basis for count I of the indictment.

On the strength of Stone's $85,000 purchase order, Robo borrowed $60,000 from the Goppert Bank & Trust Company of Kansas City, Missouri. Thereafter, Widgery called the president of Robo and made the allegedly false representation that Jefferson needed an advance commission on the Stone sale to purchase an option on a car wash site. Counts II and III charged that Widgery's telephone call and Robo's subsequent wiring of an $8,550 advance constitute wire fraud.

During November of 1977, Widgery mailed to Robo an $108,482.40 purchase order signed by Larry Duggan as president of Sun Coast Dock & Davit Corporation. The contract allegedly bore the forged signature of Duggan and named a nonexistent corporation. On receipt of this purchase order, Robo borrowed $40,000 from the Goppert Bank. In count IV the Government charges that Widgery committed mail fraud by mailing Duggan's purchase order to Robo.

Subsequent to the mailing of Duggan's purchase order, Widgery contacted the president of Robo, allegedly by telephone, to request an advance on the Duggan sale so that Widgery might purchase an option on a car wash site. Funds were deposited to Widgery's account, but the record shows no evidence of any purchase. This alleged telephone call and the wiring of an $2,218 advance by Robo form the basis for counts V and VI of the indictment.

In October 1977, Widgery mailed a purchase order to Robo on behalf of Charles Howell, representing that Howell ordered car wash equipment in the sum of $57,203. The Government alleged that Howell signed the order in blank, never intending to purchase the equipment. Again, Robo borrowed funds from the Goppert Bank on the strength of that order. The mailing of Howell's order by Widgery forms the basis for count VII. Based on the Howell purchase order, Widgery sought an advance purportedly for Jefferson to purchase an option on a car wash site. Counts VIII and IX allege that his telephone call to the president of Robo and the wiring of an $8,580 advance constitute wire fraud.

As part of his dealings with Howell, Widgery encouraged Robo to take over Midwest Cabinet Manufacturing Company of South Bend, a business owned by Howell. ³ Based on a document evidencing Midwest's agreement to the takeover, Hunter issued a SBA loan authorization letter to Robo and Midwest. ⁴ Widgery mailed this authorization to Robo and that mailing forms the basis for the count X mail fraud charge. ⁵

In connection with the Midwest takeover, Robo agreed to pay certain expenses of Midwest. Counts XI to XXVIII charged mail fraud regarding checks Robo mailed to Widgery for these expenses. The jury found Widgery not guilty on these eighteen counts.

II. Sufficiency of the Evidence.

Widgery alleges that the Government's evidence failed to establish a scheme to defraud and the requisite use of the mails or wire communications. In reviewing this claim, we must view the evidence in the light most favorable to...