U.S. v. Yost, s. 93-6160

• Decision Date: 10 May 1994
• Docket Number: Nos. 93-6160,93-6169,s. 93-6160
• Citation: 24 F.3d 99
• Parties: 40 Fed. R. Evid. Serv. 1083 UNITED STATES of America, Plaintiff-Appellee, v. Randy Clayton YOST, and Katherine Lee Yost, Defendants-Appellants.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 99

24 F.3d 99

40 Fed. R. Evid. Serv. 1083

UNITED STATES of America, Plaintiff-Appellee, v. Randy Clayton YOST, and Katherine Lee Yost, Defendants-Appellants.

Nos. 93-6160, 93-6169.

United States Court of Appeals Tenth Circuit.

May 10, 1994.

David B. Autry (C. Merle Gile, of Gile, Williams & Autry, Oklahoma City, OK, was with him on the brief), of Gile, Williams & Autry, Oklahoma City, OK, for defendants-appellants.

Ted A. Richardson (Vicki Miles-LaGrange, U.S. Atty., with him on the brief), Asst. U.S. Atty., Oklahoma City, OK, for plaintiff-appellee.

Before ANDERSON, HOLLOWAY, and TACHA, Circuit Judges.

TACHA, Circuit Judge.

Defendant Randy Clayton Yost was convicted of arson under 18 U.S.C. Secs. 844(i) and 2 and mail fraud under 18 U.S.C. Secs. 1341 and 2. Defendant Katherine Lee Yost was convicted of mail fraud under 18 U.S.C. Secs. 1341 and 2. Defendants appeal these convictions and their sentences on several grounds. ¹ We exercise jurisdiction under 28 U.S.C. Sec. 1291 and 18 U.S.C. Sec. 3742(a)(2). We affirm the convictions. However, we find that a remand is necessary for resentencing.

I. Background

In the early morning of July 22, 1991, Central Sales and Service ("Central Sales"), an automobile body repair shop owned and operated by Randy Yost, was destroyed by a serious fire. There is no dispute that this fire was a result of arson. After the fire, Mr. Yost and his wife, Katherine Yost, submitted substantial insurance claims to Farmer's Alliance Insurance under a residential policy with extension coverage for off-premises losses and to Homestead Insurance and Lloyd's of London under a business policy covering Central Sales. Further facts will be discussed below where they are relevant to defendants' specific claims on appeal.

Mr. Yost was charged with and convicted of arson in connection with the fire under 18 U.S.C. Secs. 844(i) and 2. Both Mr. Yost and Mrs. Yost were charged with and convicted of mail fraud in connection with the insurance claims under the residential policy under 18 U.S.C. Secs. 1341 and 2. Defendants now appeal.

II. Validity of the Superceding Indictment

Defendants allege that the superceding indictment in the case should have been dismissed because it was based on false testimony by a government witness. Agent Harry Eberhardt of the Bureau of Alcohol, Tobacco and Firearms testified before the grand jury that the morning of the fire at Central Sales he interviewed a witness, Tom West, who said that he saw Randy Yost's pickup truck parked outside Central Sales just before the fire started. However, Mr. West testified at trial that, while he saw a vehicle, he could not positively identify it as belonging to Randy Yost nor could he even be sure the vehicle was a pickup truck. Further, Mr. West said that he never told Agent Eberhardt that he could positively identify the vehicle as belonging to Mr. Yost. Defendant's allege that Agent Eberhardt's testimony to the contrary before the grand jury evidences government misconduct sufficient to justify dismissing the indictment. We disagree.

We have established that

[d]ismissal of an indictment after a conviction is essentially a prophylactic measure, designed more to deter prosecutorial misconduct before the grand jury than to protect a particular defendant's rights.... If a petit jury has knowledge of the same misstatement made to the grand jury and nonetheless finds a defendant guilty beyond a reasonable doubt, it is unlikely that the error before the grand jury, which must find only probable cause, was prejudicial.

United States v. Page, 808 F.2d 723, 726-27 (10th Cir.) (citations omitted), cert. denied, 482 U.S. 918, 107 S.Ct. 3195, 96 L.Ed.2d 683 (1987). Because dismissal of an indictment following a conviction is such an extreme remedy, we will only do so in rare circumstances where prosecutorial misconduct is flagrant or vindictive. Id. This case involves nothing approaching that sort of misconduct.

In addition to Agent Eberhardt's testimony before the grand jury, Gary Lee Fisher, an associate of Randy Yost, told the grand jury that Mr. West said that he saw Randy Yost's pickup truck outside Central Sales thirty minutes before the fire. Thus, Mr. West had given at least two people the impression that he did in fact see Mr. Yost's pickup on the morning of the fire. In this light and in light of the character of Agent Eberhardt's testimony ², it appears that there was at most some overstatement by Agent Eberhardt before the grand jury or simply a misunderstanding regarding Mr. West's degree of certainty rather than any serious misconduct. Further, Mr. West's uncertainty was later made eminently clear to the jury at trial. See Page, 808 F.2d at 727 (finding petit jury knowledge of information misrepresented to a grand jury relevant to whether the misrepresentation was prejudicial). We will not dismiss the superceding indictment.

III. Sufficiency of the Evidence

Defendants contend that the evidence was insufficient to convict Randy Yost of arson and mail fraud and Katherine Yost of mail fraud. We review the record de novo for sufficiency of the evidence, United States v. Grimes, 967 F.2d 1468, 1472 (10th Cir.), cert. denied, --- U.S. ----, 113 S.Ct. 355, 121 L.Ed.2d 269 (1992), and apply the following test: "The evidence--both direct and circumstantial, together with the reasonable inferences to be drawn therefrom--is sufficient if, when taken in the light most favorable to the government, a reasonable jury could find the defendant guilty beyond a reasonable doubt." United States v. Hooks, 780 F.2d 1526, 1531 (10th Cir.), cert. denied, 475 U.S. 1128, 106 S.Ct. 1657, 90 L.Ed.2d 199 (1986).

Under this standard, we find sufficient evidence to sustain the convictions of both Mr. and Mrs. Yost. With respect to Mr. Yost's arson conviction, there was evidence at trial that the Yosts had severe financial troubles; that Mr. Yost renewed his previously lapsed business insurance within several weeks of the fire and that he called to check on whether the coverage was in force within a week of the fire; that Mr. Yost ordered an inordinately large amount of DTL-10 paint thinner, the agent for starting the fire, three weeks before the fire; that much of the equipment normally in the shop had been removed prior to the fire and that it would have taken two people approximately five hours to remove the equipment, making the claim that there was a burglary in connection with the fire implausible; and that Mr. Yost was at Central Sales with a large van for several hours within days of the fire. Undoubtedly this evidence is circumstantial. However, viewing it and the other evidence presented at trial in the light most favorable to the government and allowing for the logical inferences which can be drawn therefrom, reasonable jurors could find Mr. Yost guilty of arson beyond a reasonable doubt. See Grimes, 967 F.2d at 1470 (an arson conviction can be based on circumstantial evidence).

We reach the same conclusion with respect to the mail fraud convictions of both Mr. and Mrs. Yost. First, it is apparent that both defendants were involved in filling out and submitting the insurance claims under the residential policy. Second, there was sufficient evidence from which the jury could have concluded that the Yosts listed items which were not actually destroyed in the fire and listed items at inflated prices. For example, arson expert Weldon Carmichael testified that after the fire there was no residue of many of the items listed by the Yosts as having been lost in the fire. In addition, Doy Davis of Wesco Insurance, through whom the Yosts bought their residential policy, including the off-premises extension coverage, testified that on the day of the fire Mrs. Yost told him that they had lost "some children's bicycles, some clothes, some dishes, a lawn mower and possibly a few other miscellaneous items." No mention was made at the time of diamond jewelry and the other seemingly important and expensive items later claimed lost (the total claim eventually amounted to over $49,000). Further, with respect to Randy Yost, because he was found to be involved in the arson itself, any claim he submitted as a result of the fire could constitute mail fraud. Third, we find no merit in Katherine Yost's argument that there is no substantial evidence that the use of the mails in the scheme was reasonably foreseeable by her. ³ The record makes clear that the Yosts mailed the residential policy claim to Farmer's Alliance Insurance through Mr. Harvey Lewis, the public insurance adjuster the Yosts hired. A reasonable jury could certainly find the use of the mails reasonably foreseeable under such circumstances.

Defendants further advance some specific points with regard to the sufficiency of the evidence which we will address briefly. First, they argue that, because the total residential policy claim submitted far exceeded the limits of the extension coverage for off-premises losses under the residential policy (the extension coverage was capped at $10,500 and the claim submitted was for over $49,000), there was insufficient evidence of a willful scheme to defraud. Boiled down, defendants' position is that, even if some items were fraudulently listed in the claim, the value of the items legitimately lost would have reached the $10,500 policy limit and that therefore no fraud occurred. This argument has no merit. It is far from clear what the value of the personal property actually destroyed in the fire might have been. Additionally as the district court pointed out, it is not necessary that a scheme to defraud actually succeed to support a mail fraud conviction. See 18 U.S.C. Sec. 1341; United States v. Curtis, 537 F.2d 1091, 1095 (10th Cir.1976).

We also reject Mr. Yost's claim that there was insufficient evidence of an interstate commerce nexus to sustain his arson conviction under Sec. 844(i). There was substantial testimony at trial that Central...