USA v. Ciccone
| Decision Date | 02 November 1999 |
| Docket Number | No. 98-10483,98-10483 |
| Citation | 219 F.3d 1078 |
| Parties | (9th Cir. 2000) UNITED STATES OF AMERICA, Plaintiff-Appellee, v. JOHN L. CICCONE, Defendant-Appellant. Office of the Circuit Executive |
| Court | U.S. Court of Appeals — Ninth Circuit |
Douglass A. Mitchell, Esq., Dickerson, Dickerson, Consul & Pocker, Las Vegas, Nevada, for the appellant.
Kathryn E. Landreth, Esq., Las Vegas, Nevada, for the government.
Appeal from the United States District Court for the District of Nevada, Lloyd D. George, District Judge, Presiding; D.C. No. CR-95-00320-LDG
Before: Procter Hug, Jr., Chief Judge, Warren J. Ferguson and Kim McLane Wardlaw, Circuit Judges.
John L. Ciccone appeals his conviction and sentence for one count of conspiracy, 18 U.S.C. S 371, thirty-four counts of wire fraud and aiding and abetting, 18U.S.C.S 1343 and 2, thirty-six counts of money laundering and aiding and abetting, 18 U.S.C. SS 1956(a)(1)(A)(I) and 2, and one count of forfeiture, 18 U.S.C. S 982(a)(1). We affirm both his conviction and sentence.
Ciccone was the owner of Feed America Inc. ("Feed America"), a telemarketing company in Las Vegas, Nevada. From March of 1994 until October of 1995, he ran a scheme to defraud people throughout the country. He paid his solicitors a straight commission to telephone people, who had previously relied upon the promises of other telemarketers, and persuade them to send money to Feed America. They succeeded in doing so by telling victims that they had won money, a fabulous prize, and the opportunity to donate to charitable causes. There was one hitch: the lucky victims first had to pay a sizeable sum to Feed America. When people refused, the solicitors called them over and over again. When they did send their money, Feed America returned ten percent of their donation and a cheap gift. Its donations to charitable causes were minuscule.
Ciccone designed a "pitch" for Feed America solicitors to use, which convinced people that they had won an extraordinary prize. It started out like this:
This is (Fundraiser's Name) with FEED AMERICA in Las Vegas, Nevada . . . the reason for the call is . . . a while back, you had filled out an entry form where you had a chance to win a [sic] award. You signed your name on it and left this phone number to notify you if you had won. Do you recall that? (Response)
Well, you've done much better than that, because you're no longer in competition with anybody else!! The Board of Directors of FEED AMERICA have selected your name for one of the absolute nicest awards[.]
Congratulations!! (Response)
I've always believed that water seeks it's [sic ] own level and that great things happen to great people!! You must be a great person because no one is competing against you!!
After effusively congratulating the potential victim for winning a fabulous prize in an apparently fierce competition, the solicitor unveiled the catch:
Well, we ask two simple favors of you . . . and I know that you will agree that they are both fair and reasonable.
First, we would like a photo of you with your award so that we can show that real people, like yourself, do receive the nice awards!!
Second, we want you to help us with the national campaign to help feed America. What FEED AMERICA does is feed the homeless of America . . . . How can we help people in other countries when we cannot help ourselves? Isn't it about time we took care of our own people?
. . . . All we ask is a donation from you in the amount of $_______1 which guarantees you one of the nicest awards from the Board of Directors of the Organization. (first omission and blank space in original).
As one solicitor testified at Ciccone's trial, this pitch was designed in part Another testified that it gave the impression that victims had "[f]inally hit the jackpot or whatever you want to say." One victim agreed with this assessment, testifying that she was led to believe that Feed America would send "something very, very valuable." Another echoed this perception when she testified,"I was supposed to get top awards for doing good."
In reality, Feed America failed to make good on its promises. The Board of Directors to which solicitors referred did not exist. More important, when Ciccone's victims paid to get their fabulous prize, Feed America sent back ten percent of their money and a cheap gift, like a calendar or a porcelain eagle. The homeless did not fare much better under the deal: evidence showed that of the $2,306,611.56 it received, Feed America gave only $149,286.65 to legitimate charities. The rest, some $2 million, was deposited in Ciccone's personal bank account.
Testimony at trial revealed that Ciccone was involved in the day-to-day operations of Feed America. He hired the solicitors and occasionally supervised them. Every day, he provided the solicitors with "reload lists" showing the names of people to call and how much those on the lists had previously given to telemarketers. These lists were, according to one Feed America solicitor's testimony, the best kind because "they already bought, so chances are they might buy again." In addition, Ciccone purchased the decidedly unremarkable gifts Feed America's solicitors told victims that they had won. As the person in charge of customer service, he also dealt with the steady stream of complaints from donors. In sum, Ciccone was actively involved in the daily operation of Feed America.
A second superseding indictment, dated March 18, 1998, charged Ciccone with conspiracy, wire fraud and aiding and abetting, money laundering and aiding and abetting, and forfeiture. On April 6, 1998, after an eight-day trial, the jury returned a guilty verdict on each count.
On October 23, 1998, the district court sentenced Ciccone to a prison term of 168 months. It made two sets of upward adjustments that Ciccone challenges in this appeal. First, it added six points after finding that Ciccone had laundered $2,235,135.20. It then added another two points on the ground that the victims were vulnerable because they had previously fallen for telemarketing schemes.
Ciccone challenges his conviction on four grounds. First, he argues that the district court erred when it excluded evidence of satisfied donors to buttress his good faith defense. Second, he contends that the government presented insufficient evidence that the scheme to defraud was reasonably calculated to deceive persons of ordinary prudence and comprehension. Third, he asserts that the government presented insufficient evidence of his participation in a conspiracy or scheme to defraud. Finally, he contends that the prosecution violated its obligation under Brady v. Maryland, 373 U.S. 83 (1963), to turn over material evidence. We reject these arguments and affirm his conviction.
Ciccone contends that the district court erred when it excluded evidence of satisfied donors and charities to support his good faith defense at trial. To sustain a conviction for fraud and money laundering, the government must prove beyond a reasonable doubt the element of specific intent. United States v. Sayakhom, 186 F.3d 928, 941 (9th Cir. 1999), amended by 197 F.3d 959 (9th Cir. 1999), cert. denied, 120 S.Ct. 1216 (2000). In an attempt to negate this element, Ciccone proffered evidence of satisfied donors who had sent him letters singing Feed America's praises. Specifically, the donors would have testified that they believed Feed America was a legitimate charitable organization, and that they liked both the gifts and the ten percent cash award Feed America returned to them. Ciccone argued to the district court that these expressions of gratitude kept him in the dark about his business' illegitimate practices. We review evidentiary rulings by the district court for abuse of discretion. United States v. Leon-Reyes, 177 F.3d 816, 819 (9th Cir. 1999)."We will reverse for abuse of discretion only if such nonconstitutional error more likely than not affected the verdict. " United States v. Ramirez, 176 F.3d 1179, 1182 (9th Cir. 1999) (internal quotation marks omitted).
Ciccone relies on United States v. Thomas, 32 F.3d 418, 420-21 (9th Cir. 1994), where we recognized that evidence of the benefits customers received can be relevant to the issue of whether an accused had the requisite specific intent to defraud. We conclude, however, that this case is distinguishable. Thomas was convicted of fraud for misrepresenting to growers the actual prices that buyers were willing to pay for their fruit. Id. at 419. Thomas conceded at trial that he had misrepresented the prices, but he claimed that he did so to even out the market's wild fluctuations and that he had no intent to defraud the growers. Id. This would, of course, have negated the offense's specific intent element, which required proof of intent to deprive the victim of money or property. Id. In support, Thomas sought to put before the jury evidence showing that the scheme had satisfied growers because they had actually come out ahead by some $175,980. Id. The trial court excluded this testimony as irrelevant, although it permitted the government to present the testimony of people who had lost money under Thomas' averaging scheme. Id. at 419-20.
We held that, given the nature of both the evidence and the scheme, the district court committed reversible error when it excluded Thomas' evidence of the benefits the growers received. Id. at 422. Evidence showing actual gain was highly probative on the issue of the nature of his scheme and whether he had an intent to deprive growers of their property. Id. at 420-21. By contrast,...
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