United States v. Dvorin

• Decision Date: 18 March 2016
• Docket Number: Nos. 15–10142,15–10183.,s. 15–10142
• Citation: 817 F.3d 438
• Parties: UNITED STATES of America, Plaintiff–Appellee v. Jason DVORIN, Defendant–Appellant. United States of America, Plaintiff v. Jason Dvorin, Defendant Mindy Sauter, Interested Party–Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

817 F.3d 438

UNITED STATES of America, Plaintiff–Appellee

v.Jason DVORIN, Defendant–Appellant.

United States of America, Plaintiff

v.Jason Dvorin, Defendant

Mindy Sauter, Interested Party–Appellant.

Nos. 15–10142

15–10183.

United States Court of Appeals, Fifth Circuit.

March 18, 2016.

Leigha Amy Simonton (argued), James Wesley Hendrix, Asst. U.S. Atty., U.S. Attorney's Office, Dallas, TX, for Plaintiff–Appellee.

Kevin Joel Page (argued), Charles M. Bleil, Federal Public Defender's Office, Dallas, TX, for Defendant–Appellant.

Before PRADO, OWEN, and HAYNES, Circuit Judges.

HAYNES

, Circuit Judge:

This is an appeal from the retrial of defendant Jason Dvorin, who was convicted of one count of conspiracy to commit bank fraud. On appeal, Dvorin contends the district court erred by refusing to give certain requested jury instructions, excluding certain admissible evidence but admitting other inadmissible evidence, failing to adequately sanction the government for prosecutorial misconduct, and failing to dismiss the forfeiture notice in his indictment due to prosecutorial vindictiveness. Consolidated with Dvorin's appeal is the appeal of Mindy Sauter, who prosecuted Dvorin during his first trial. Sauter appeals the district court's findings that she committed Giglio, Brady , and Napue violations.¹ For the reasons explained below, we VACATE the district court's judgment of forfeiture and AFFIRM on all other grounds.

I. Background

Jason Dvorin was a business customer of Pavillion Bank ("Pavillion") with multiple accounts and loans collateralized by vehicles and oil-field equipment. To alleviate his periodic cash-flow issues, Dvorin brought checks to Pavillion's executive vice president, Chris Derrington, that neither man expected would clear. Derrington nonetheless processed the checks, giving Dvorin access to the face value of the check until the checks were returned. This arrangement operated as an unofficial line of credit. Dvorin and Derrington maintained this arrangement from 2005 through December of 2010, during which time the bank charged Dvorin more than $19,000 in overdraft fees.

The arrangement continued for five years, in part because Dvorin was able to periodically deposit large, legitimate payments into his accounts. Ultimately, however, bank auditors discovered the scheme. In 2012, the government indicted defendant Dvorin on one count of conspiring to commit bank fraud. The superseding indictment alleged that between 2005 and December 2010, Dvorin and Derrington engaged in a scheme in which they deposited checks in Dvorin's account knowing the deposited checks would not clear. The indictment did not contain a forfeiture count.

After a two-day trial, a jury found Dvorin guilty. During trial, the government elicited testimony from Derrington, who had pleaded guilty to conspiring to commit bank fraud and was awaiting sentencing. Derrington explained that he had cooperated with the government during its investigation, and that he was testifying in the hope that he would obtain some leniency in his sentencing. The prosecutor asked Derrington whether he had received any promises from the government in exchange for his testimony, and Derrington responded that he had not. The court sentenced Dvorin to 24 months of imprisonment and ordered $111,639.73 in restitution.

Dvorin appealed, and we set the case for oral argument. While preparing for oral argument, the government's appellate counsel discovered that the trial prosecutor, Mindy Sauter, had failed to disclose Derrington's sealed plea agreement supplement to Dvorin's counsel. The plea agreement supplement stated, in relevant part, that, "[i]f in its sole discretion, the government determines that the defendant has provided substantial assistance in the investigation or prosecution of others, it will file a motion urging sentencing consideration for that assistance." The government produced the supplement to Dvorin's counsel and agreed to an order vacating Dvorin's conviction and remanding the case for a new trial.

On remand, the district court sua sponte issued a show cause order in which it requested that the government's counsel file a pleading addressing why sanctions should not be imposed for Sauter's failure to disclose Derrington's plea agreement supplement and Sauter's permitting Derrington to falsely testify that the government had not made him any promises. The district court held an evidentiary hearing in connection with the show cause order, and thereafter made preliminary findings that Sauter had violated Brady and Giglio by failing to turn over Derrington's plea agreement supplement. The district court also concluded that Sauter had violated Napue by permitting Derrington to testify falsely regarding the promises the government made him. The district court found that Sauter did not act in "bad faith," but "exhibited a reckless disregard for her duties and conducted the proceedings in an irresponsible manner." The district court declined to make a decision regarding the propriety of sanctions at that time.

While the sanctions issue was pending, the same U.S. Attorney's Office in which Sauter worked assigned a new prosecution team to handle Dvorin's new trial. The new prosecutors filed a second superseding indictment in which they included a forfeiture count for the first time. Dvorin moved to dismiss the forfeiture count on the basis of prosecutorial vindictiveness and judicial estoppel, but the district court denied the motion. Dvorin was tried a second time and the jury once again convicted Dvorin of conspiring to commit bank fraud. The district court then imposed a new sentence of 18 months of imprisonment, two years of supervised release, and $110,939.73 in restitution. The court also entered a forfeiture judgment in the amount of $91,239.73. The district court declined to impose sanctions based on Sauter's prosecutorial misconduct, but formally adopted as final its substantive findings that Sauter committed Brady, Giglio , and Napue violations.

Dvorin and Sauter filed separate appeals that have been consolidated. Dvorin's appeal is a direct appeal from a judgment in a criminal case. Sauter appeals the district court's reputational findings against her under Walker v. City of Mesquite, 129 F.3d 831, 832–33 (5th Cir.1997)

(holding that an attorney's challenge to a district court's reprimand and finding of misconduct present a reviewable appellate issue).

II. Discussion

Dvorin appeals his conviction, asserting that the district court erred in: (1) denying his request for an apparent-authority jury instruction; (2) denying his request for a special unanimity jury instruction; (3) overruling his objections under Federal Rules of Evidence 701

and 704 to the government counsels' and witnesses' use of the terms "fraud," "fraudulent check," or "conspiracy"; (4) excluding extrinsic evidence of and cross-examination regarding the court's findings that Derrington testified falsely in a prior proceeding; (5) declining to award sanctions for prosecutorial discovery misconduct; (6) admitting the testimony of Chase Bank representative Arthemis Lindsay despite the government's failure to timely designate Lindsay as a possible witness on its witness list; and (7) permitting the government to add a forfeiture count to the second superseding indictment before the second trial and entering a forfeiture judgment at sentencing without having a jury find the facts essential to that judgment. Sauter appeals, contending that the district court erroneously found that she violated Brady, Giglio , and Napue and acted "recklessly" by failing to timely disclose Derrington's plea agreement supplement. We consider each challenge in turn.

A. Failure to Give Adequate Jury Instructions

Dvorin contends the district court erred in refusing to charge the jury with an apparent-authority instruction and a special unanimity instruction. We review a district court's refusal to give a defensive jury instruction for an abuse of discretion. See United States v. Salazar, 751 F.3d 326, 330 (5th Cir.2014)

(citing United States v. Webster, 162 F.3d 308, 321–22 (5th Cir.1998) ).

A refusal to give a requested instruction constitutes reversible error only if the proposed instruction (1) is substantially correct, (2) is not substantively covered in the jury charge, and (3) pertains to an important issue in the trial, such that failure to give it seriously impairs the presentation of an effective defense.

Id. (quoting Webster, 162 F.3d at 322

).

1. Apparent–Authority Instruction

During Dvorin's trial, Dvorin attempted to create reasonable doubt regarding his "intent to defraud" by showing that he relied on Derrington's apparent authority to approve his checks. Dvorin thus requested that the district court give the following instruction: "In order to prove that the defendant had the intent of tricking the bank, the government must show that the defendant did not rely on the apparent authority of one or more bank officials."

Rather than insert Dvorin's proposed apparent-authority instruction, the court largely accepted Dvorin's proposed good faith instruction:

The word "willfully" ... means that the act was committed voluntarily and purposely, with the specific intent to do something the law forbids; that is to say, with bad purpose either to disobey or disregard the law. A defendant does not act willfully if he believes in good faith that his conduct does not violate the law. This is so even if that belief is objectively unreasonable.

The district court also instructed the jury that "[o]fficers, directors, or other employees of a financial institution cannot validate a fraud on the institution. Therefore, the knowledge of bank fraud by officers, directors, or other employees of the institution is not a defense to the charge of bank fraud." Dvorin insists that the charge did not adequately address his apparent-authority defense because the good faith instruction was abstract rather than specific to the facts presented by...