United States v. Joyce
| Citation | 499 F.2d 9 |
| Decision Date | 09 May 1974 |
| Docket Number | No. 73-1014 to 73-1016.,73-1014 to 73-1016. |
| Parties | UNITED STATES of America, Plaintiff-Appellee, v. Thomas E. JOYCE et al., Defendants-Appellants. |
| Court | United States Courts of Appeals. United States Court of Appeals (7th Circuit) |
COPYRIGHT MATERIAL OMITTED
COPYRIGHT MATERIAL OMITTED
COPYRIGHT MATERIAL OMITTED
Herman R. Tavins, Gerald M. Werksman, Richard J. Horka, Anna R. Lavin, Burton Sherre, Chicago, Ill., for defendants-appellants.
James R. Thompson, U. S. Atty., Arnold Kanter, Asst. U. S. Atty., Chicago, Ill., for plaintiff-appellee.
Before SWYGERT, Chief Judge, HASTINGS, Senior Circuit Judge, and CUMMINGS, Circuit Judge.
As Amended on Denial of Rehearing in Nos. 73-1014, 73-1016 May 28, 1974.
Rehearing Denied in No. 73-1015 June 4, 1974.
A 15-count mail fraud indictment was returned against defendants Joyce, Sherre, Wallace and Robert L. Ostrander. Ostrander pled guilty to count 14, but this count was dismissed as to the other three defendants. Joyce was convicted under counts 1, 8, 9, 10, 11, 13 and 15; Sherre was convicted under counts 9, 10, 11 and 13, and Wallace was convicted under count 5.1 The only prison terms imposed were on Joyce, who received a one-year sentence on count 1, and on Wallace, who received a one-year sentence on count 5. Fines and probationary terms were imposed upon Joyce and Sherre under the other counts. This appeal involves the validity of convictions under eight counts (counts 1, 5, 8, 9, 10, 11, 13 and 15) of the 15-count indictment.
Count 1, the lead count of the indictment, charged that the four defendants (including Ostrander) devised a scheme to defraud firms engaged in the business of placing insurance risks, denominated in the indictment as "insurance brokers and agents," certain state departments of insurance, denominated in the indictment as "state insurance agencies," and persons who were induced to purchase insurance policies from Global Surplus and Excess Limited (Global), a company organized in the Bahamas.
According to the lengthy allegations contained in count 1, defendants caused Trust No. 15385, an Illinois land trust, to be entered into between Global and the Cosmopolitan National Bank of Chicago. Thereafter, defendants represented that the trust was established to protect the United States and Canadian policyholders of Global. They also entered into an agreement giving Sherre a power of attorney to direct the trust. They conveyed certain Illinois real estate into the trust and represented that it was an asset of Global for the benefit of its policyholders. They had the Cosmopolitan National Bank circulate copies of the trust agreement to insurance brokers and agents and state insurance agencies to induce them to place and permit the placing of insurance risks with Global. They prepared letters of appraisal for the trust real estate assigning an excess value thereto, and they caused the letters of appraisal to be circulated to insurance brokers and agents and state insurance agencies in order to induce them to use and permit use of Global. They also omitted to advise the insurance brokers and agents and state insurance agencies that some of the trust real estate was heavily mortgaged. They formed an Illinois corporation known as Global Surplus and Excess Limited of Illinois and represented that it was a holding company for the trust real estate. They were charged with making the following false representations in financial statements of Global:
The grand jury also charged that defendants circulated these false financial statements of Global to insurance brokers and agents and to state insurance agencies. Defendants allegedly converted funds deposited in the checking accounts of various banks that had been deposited for the protection of Global policyholders.
Each of the subsequent counts repeated these general allegations by reference. All fifteen counts alleged a different mailing in violation of 18 U.S.C. § 1341, the mail fraud statute.2
Various pre-trial motions of defendants were denied by the district court before the commencement of the jury trial. After a few trial days, the Government moved to dismiss count 2 as to all defendants and count 15 as to defendant Wallace, and the trial judge acceded. The jury found Joyce guilty on all counts (except the dismissed count 2). It found Sherre guilty on counts 7 through 15, and Wallace guilty on counts 5, 6 and 8. The district court granted Joyce's post-trial motions for acquittal as to counts 3 through 7 and 12 and 14. The court also granted Sherre's motion for acquittal on counts 7, 8, 12 and 14, and Wallace's motion for acquittal on counts 6 and 8. As noted above, Joyce is appealing his conviction on counts 1, 8, 9, 10, 11, 13 and 15; Sherre is appealing on counts 9, 10, 11, 13 and 15; and Wallace on count 5.
Defendants rather half-heartedly contend that the scheme was not proven because there is no showing that the misstatements of assets were made with intent to defraud rather than negligently. The magnitude of the misrepresentations is alone sufficient to support the jury's finding that they were not made negligently. Additional evidence of scienter is summarized infra at p. 21 in the discussion of Sherre's separate contention that he was simply Global's attorney and was never aware of the fraud being perpetrated by his clients.
Defendants next contend that the evidence failed to sustain the charges concerning the individual mailings. In the interests of an orderly presentation, we will take up the counts assailed in numerical sequence.
Count 1
Joyce is the only defendant convicted under this count, which charged that Joyce and his co-defendants caused a letter to be mailed to Joyce from the Industrial Valley Bank & Trust Company.3 The letter was addressed to Joyce by W. Kenneth Clark of that bank and agreed to send Joyce duplicate statements of Global's account with the bank commencing with the May 1966 statement. The Government has argued that the letter furthered the scheme because it was essential for Joyce to keep track of the balance in the account so that he and other defendants could withdraw funds from the account for their own use, although they represented that it was to be a reserve to pay losses. Since the district court found that Joyce had drawn a $2,359.65 check on the account payable to American Express, it concluded that "a reasonable mind could thus have fairly found beyond a reasonable doubt that the count letter was incident to an essential element of the conversion scheme—knowledge of the balance in the account."4 We agree that the trier of facts could have drawn the inference that the American Express check was not drawn to pay a policyholder's claim. Whether the check paid for business or personal expenses is of no moment—either use is inconsistent with maintenance of the account as a loss reserve for policyholders.5
Conceding this arguendo, Joyce argues that he only requested a bank statement, and that the mailing charged was not a bank statement, but an unexpected acknowledgement of his request—a mere courtesy letter. He argues that he did not cause the mailing of the courtesy letter, and that the courtesy letter could not have furthered the scheme. However, the letter was more than a mere acknowledgement; it also informed Joyce that there would be a $1 per month fee for the service he requested. It was foreseeable that there would be a charge, and that the bank would not impose the charge without an explanation. Joyce could thus foresee that his request would cause the mailing of a letter advising him of the fee, and this is sufficient. "One `causes' the mails to be used where he `does an act with knowledge that the use of mails will follow in the ordinary course of business, or where such use can reasonably, be forseen, even though not actually intended * * *.'" United States v. Maze, 414 U.S. 395, 399, 94 S.Ct. 645, 648, 38 L.Ed.2d 603, quoting from Pereira v. United States, 347 U.S. 1, 9, 74 S.Ct. 358, 98 L.Ed. 435. The count letter also furthered the scheme since it was impossible for Joyce to obtain the needed bank statements without causing the mailing of the count letter.
As to the proof of mailing of this count letter, witness Clark testified that he dictated the letter and that his secretary's practice was to send out all dictated letters (other than interoffice correspondence) by mail. Testimony as to office practice is sufficient proof of mailing. United States v. Shavin, 287 F.2d 647, 652 (7th Cir. 1961); United States v. Silvern, 484 F.2d 879, at 884-885, reheard en banc on other grounds, 484 F.2d 879 (7th Cir. 1973); United States v. Flaxman, 495 F.2d 344, at 349 (7th Cir. 1974). While the evidence in those cases was somewhat stronger than here, we hold that Clark's testimony was sufficient proof of mailing. Even weaker proof of mailing was held sufficient on some counts in King v. United States, 25 F.2d 242, 244 (6th Cir. 1928).
Joyce also contends that venue has not been established despite the showing that the usual procedure was to mail such a letter from Pennsylvania to the recipient at the address shown on the letter, here 7019 West Higgins Avenue, Chicago. Illinois 60656. In the normal course of the mails, we presume that a letter is sent to the address shown,...
To continue reading
Request your trial
-
U.S. v. Mays
...not, prove that the testimony, if available, would not have been of critical importance to the defense. 8 Compare United States v. Joyce, 499 F.2d 9, 20 (7th Cir. 1974) cert. denied, 419 U.S. 1031, 95 S.Ct. 512, 42 L.Ed.2d 306 The evident prejudice suffered by the appellees leads me ineluct......
-
U.S. v. McPartlin
...90 S.Ct. 573, 24 L.Ed.2d 504 (1970), even when one defendant takes the stand and blames his co-defendant for the crime, United States v. Joyce, 499 F.2d 9, 21 (7th Cir.), Cert. denied, 419 U.S. 1031, 95 S.Ct. 512, 42 L.Ed.2d 306 (1974). Even when the defendant who testified he was the victi......
-
Menzies v. Seyfarth Shaw LLP
...States v. Brighton Building & Maintenance Co ., 435 F. Supp. 222, 229 n.10 (N.D. Ill. 1977) (Flaum, J.), citing United States v. Joyce , 499 F.2d 9, 18 (7th Cir. 1974), quoting in turn Badders v. United States , 240 U.S. 391, 394, 36 S.Ct. 367, 60 L.Ed. 706 (1916) ; see also Bridge v. Phoen......
-
Mattingly v. Mattingly
...1209, 1217-18, 20 L.Ed.2d 138; Singer v. United States, 380 U.S. 24, 34, 85 S.Ct. 783, 789, 13 L.Ed.2d 630 (1965); United States v. Joyce, 499 F.2d 9, 21 (7th Cir.1974), cert. denied, 419 U.S. 1031, 95 S.Ct. 512, 42 L.Ed.2d 306 (1974); Thwing v. State, 470 F.2d 351, 353 (8th Cir.1972), cert......