U.S. v. Wormick, 81-2617

Citation709 F.2d 454
Decision Date02 June 1983
Docket NumberNo. 81-2617,81-2617
Parties12 Fed. R. Evid. Serv. 2008 UNITED STATES of America, Plaintiff-Appellee, v. James WORMICK, Jr., Defendant-Appellant.
CourtUnited States Courts of Appeals. United States Court of Appeals (7th Circuit)

William M. Doty, Jr., Russo, Doty & Associates, Chicago, Ill., for defendant-appellant.

John H. Newman, Asst. U.S. Atty., Dan K. Webb, U.S. Atty., Chicago, Ill., for plaintiff-appellee.

Before WOOD and ESCHBACH, Circuit Judges, and HOFFMAN, Senior District Judge. *

ESCHBACH, Circuit Judge.

The defendant appeals his conviction on five counts of violating 18 U.S.C. Sec. 1341 through a mail fraud scheme designed to defraud State Farm Insurance by the submission of false automobile accident and theft claims. For the reasons below, we affirm in part and reverse in part.

I

The evidence adduced at Wormick's trial, taken in the light most favorable to the government, indicates that Wormick was involved in an insurance fraud scheme involving at least ten persons. Wormick's role, as a police officer in Dixmoor, Illinois, was to supply falsified police reports, for a price.

Ulric B. ("Buddy") Williams was at the center of this scheme. Beginning in 1976, he enlisted friends and acquaintances to defraud State Farm Insurance ("State Farm") out of approximately $143,000. Mr. Edward Gronowski, a State Farm claims supervisor, was paid to process the fraudulent claims quickly and for "top dollar." The defendant Wormick was paid to write false police accident and theft reports. Ulric Williams, using the aliases of Homer Boddy, John Travis and Elgin Carter, submitted and collected on eleven fraudulent claims. A friend of Williams, Rubylene Rayford, using her own name and the alias Francis Norris, submitted and collected on four fraudulent claims. Williams' employer, Elsa Townsell, in his own name and in the name of the body shop he owned, submitted and collected on six fraudulent claims. Other members of the scheme included Williams' sister (Linda Williams, one claim), girlfriend (Jackie Miller, two claims), and a secretary at Townsell's body shop (Amarie Davis, one claim). Other of Williams' friends accounted for five other claims, bringing the total number of fraudulent claims to thirty.

Wormick's involvement with the scheme began in early summer of 1976, when Williams solicited his help in obtaining false police reports. Wormick agreed to write such reports for between $250 and $400 each. Wormick wrote nine separate police reports, supposedly documenting six accidents, thefts and recoveries.

A superseding indictment charged Wormick and several codefendants with nineteen counts of mail fraud, stemming from nineteen fictitious automobile accidents, thefts and recoveries, some of which involved multiple insurance claims. Wormick was named in counts three through nineteen, and the evidence adduced at trial indicates that he personally wrote police reports purportedly documenting the occurrences which were the bases for counts three, nine, twelve, fifteen, sixteen and nineteen. Wormick admitted writing the reports, but insisted that he was an unwilling dupe of the parties to the scheme, merely recording information they gave him, as required by police policy. He denied receiving any payment for any of the reports.

The jury acquitted Wormick of all counts covering occurrences for which he did not personally write a police report, as well as count three, chronologically the first occurrence for which he wrote a report. The counts on which Wormick was found guilty are described in more detail below.

The evidence relating to count nine indicates that Wormick wrote a theft recovery report on February 6, 1977 for a 1977 Pontiac Grand Prix which had never been stolen. The indictment alleges that Wormick knowingly caused to be placed in the mails matter including an application for auto insurance for the car.

Count twelve involved the supposed accident between a 1975 Buick LaSabre and a 1974 Mercury on April 20, 1977. The indictment charged that Wormick knowingly caused to be placed in the mails matter including a check from State Farm to Dunn-Rite Rent-A-Car.

Count fifteen also involved a supposed accident, this one between a 1971 Cadillac Brougham and a 1976 Oldsmobile on June 15, 1977. The indictment alleged that Wormick knowingly caused to be placed in the mails matter including an application for auto insurance on the Cadillac.

Count sixteen involved the supposed theft and recovery of a 1977 Pontiac on June 22, 1977. The indictment charged that Wormick knowingly caused to be placed in the mails matter including a letter from State Farm to the Dixmoor Police Department concerning the car.

Count nineteen involved a supposed three car accident on October 31, 1977, that resulted in over $20,000 in claims. This event involved a 1976 Buick Riviera, a 1977 Chevrolet, and a 1977 Cadillac. The indictment charged Wormick with knowingly causing to be placed in the mails a Dunn-Rite Rent-A-Car invoice addressed to State Farm Insurance.

Wormick was sentenced to two years imprisonment on count nine and five years probation on the remaining counts, consecutive to the term of imprisonment. Wormick appeals.

II

Wormick raises three issues on appeal. First he challenges the admissibility of the government's evidence as well as the related argument regarding an incident, unrelated to the crimes charged, that resulted in Wormick's demotion from sergeant to patrolman for falsifying a police report. Second, he asserts that the government introduced no credible evidence linking him to the scheme to defraud. Finally, he contends that there is not a sufficient nexus between his alleged conduct and the mailings charged in the indictment to support his convictions.

III
A. Evidence of an Unrelated Falsified Police Report

When testifying on his own behalf, Wormick asserted that at the time he wrote each of the police reports introduced into evidence, he believed the underlying theft or accident to be legitimate. On cross-examination, Wormick denied ever having knowingly falsified any information as a police officer.

The government offered, over objection, one rebuttal witness, Lieutenant Robert Vinson of the Dixmoor Police Department, who testified that Wormick had been demoted from sergeant to patrolman in September 1977 for neglect of duty and falsifying records. He related that Wormick had received a call that shots had been fired and later reported that the call was unfounded. Vinson interviewed the two people involved in the shooting incident, then he spoke with Wormick. Vinson stated that Wormick's account conflicted with what the two people had told him. Defense counsel's objection on hearsay grounds to an account of Vinson's conversation with the two people was sustained. Vinson testified that he made a recommendation to the Chief of Police on the basis of his investigation. He then read into the record a letter from the Chief of Police informing Wormick of his demotion and the reasons for the action. In response to the government's rebuttal, Wormick took the stand to explain the circumstances of his demotion.

In considering the government's rebuttal evidence, we face two issues--first, whether the substance of the evidence, i.e. demotion for falsifying police records, was admissible, and second, whether the form in which the evidence was introduced was admissible.

It is undisputed that the evidence of Wormick's demotion for falsifying a police report unrelated to the crimes with which he was charged could not be admitted to show a general propensity to falsify reports. See Fed.R.Evid. 404(b); United States v. Weidman, 572 F.2d 1199, 1201 (7th Cir.1978), cert. denied, 439 U.S. 821, 99 S.Ct. 87, 58 L.Ed.2d 113 (1979). However, in appropriate circumstances, the evidence could be introduced to show that Wormick falsified the reports that were part of the scheme intentionally rather than by accident or mistake. See Fed.R.Evid. 404(b); Andresen v. Maryland, 427 U.S. 463, 483, 96 S.Ct. 2737, 2749, 49 L.Ed.2d 627 (1976). Evidence of an unrelated "bad act" for the purpose of showing intent or absence of mistake is admissible if:

(1) the prior act is similar enough and close enough in time to be relevant, (2) the evidence of the prior act is clear and convincing, (3) the probative value of the evidence outweighs the risk of prejudice, and (4) the issue to which the evidence is addressed is disputed by the defendant.

United States v. Feinberg, 535 F.2d 1004, 1009 (7th Cir.1976), cert. denied, 429 U.S. 929, 97 S.Ct. 337, 50 L.Ed.2d 300 (1977).

Addressing the first criterion, we believe that the act of falsifying the police report on the shooting incident is sufficiently similar to the acts of falsifying accident and theft reports to be relevant to the issue of intent and absence of mistake. Moreover, Wormick wrote the report on the shooting incident sometime between the theft/recovery report of count sixteen and the accident report of count nineteen. Wormick insisted that during this period, he was an innocent dupe of the parties to the insurance fraud scheme, unwittingly recording false information he believed to be true and accurate. The evidence that he had been demoted for falsifying a report during that time period is relevant to show that the other reports were also intentionally falsified. Cf. United States v. Miller, 573 F.2d 388, 392-93 (7th Cir.1978) (when defendant was charged with knowingly making a false statement for the purpose of influencing a federally insured bank, false statements made to other banks were admissible to show intent); United States v. Kaufman, 453 F.2d 306, 310-11 (2d Cir.1971) (when defendant was charged with making false affidavits to obtain default judgments in violation of federal law, evidence of false statements made on personal tax return was relevant to rebut his testimony that he was "an unwitting employee beguiled by his superiors into unknowingly...

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