Justia U.S. 10th Circuit Court of Appeals Opinion Summaries

Defendants-Appellants David Banks, Kendrick Barnes, Demetrius Harper, Clinton Stewart, Gary Walker, and David Zirpolo were convicted following a jury trial on multiple counts of mail fraud and wire fraud, and conspiracy to commit mail fraud and wire fraud. Defendants contacted numerous staffing agencies to “assist in providing temporary services. Witnesses from multiple staffing companies testified that a Defendant (or someone acting as Defendants’ agent) approached them and expressed the desire for "payrolling" services. The staffing-company witnesses testified that they were induced into believing that Defendants’ companies were either doing business with major law-enforcement agencies or were on the verge of selling a specialized software to these agencies. These witnesses testified that Defendants (or Defendants’ agents) assured them that this alleged law-enforcement business would enable Defendants’ companies to pay the staffing companies’ invoices, and, critically, that they relied on these representations in choosing to do business with Defendants. Trial testimony from representatives of the law-enforcement agencies with whom Defendants claimed to be doing business revealed the falsity of Defendants’ representations to the staffing companies. When questioned about their failure to pay the staffing companies’ invoices, Defendants gave false assurances that payment would be forthcoming, and they continued to imply that they were doing business with large government law enforcement agencies. In the end, forty-two different staffing companies were left with outstanding invoices totaling in excess of $5,000,000, which could not be submitted to the government agencies, which had no business relationship with Defendants’ companies. Defendants were sentenced to terms of imprisonment ranging from 87 to 135 months. Defendants argued on appeal to the Tenth Circuit: (1) their right to a speedy trial was violated when the district court granted multiple continuances of the trial date (at Defendants’ request); (2) the district court compelled co-Defendant Barnes to testify in violation of his Fifth Amendment privilege against self-incrimination and failed to give a proper curative instruction; (3) the district court abused its discretion in excluding the testimony of two witnesses Defendants sought to call at trial; and (4) the cumulative effect of the district court’s otherwise harmless errors prejudiced them and required reversal. Finding no reversible error, the Tenth Circuit affirmed. View "United States v. Banks" on Justia Law

In 2006, United States Postal Inspectors learned Crosby Powell had deposited checks stolen from the United States mail into his accounts at TCF Bank, UMB Bank, and Wells Fargo. An investigation revealed Powell had altered payee information or forged endorsements on some of the stolen checks. The United States obtained a superseding indictment charging Powell with eleven counts of uttering or possessing forged checks, and seventeen counts of possessing stolen mail. At trial, the government sought to prove the forged checks were “of an organization” by presenting evidence that each bank into which the forged checks were deposited was a federally insured bank operating in interstate commerce. The jury convicted Powell on the first eleven counts set out in the indictment. In his appeal to the Tenth Circuit, Powell raised three challenges to his convictions, all of which were raised for the first time on appeal, all of which were raised on the same premise: at no point during his possession or utterance of the forged checks were the checks "of" the banks into which they were deposited. The Tenth Circuit agreed that the forged checks were not "of" the depository banks. Because Powell did not raise his arguments before the district court, however, he was not entitled to relief unless he could "successfully run the gauntlet created by our rigorous plain-error standard of review." The Court found that Powell could not satisfy this burden as to all counts of conviction. Accordingly, the Court: (1) affirmed Powell’s convictions as to Counts 10, 13, and 20; and (2) remanded the case to the district court so it could vacate the remaining convictions and take any other necessary actions. View "United States v. Powell" on Justia Law

A grand jury returned a three-count indictment charging Safiyyah Tahir Battles with: (1) making a false statement to a financial institution (Count I); (2) committing wire fraud (Count II); and (3) laundering money (Count III). Battles exercised her right to a jury trial, and the jury returned a verdict of guilty on Counts II and III. The jury failed to reach a verdict on Count I. As a result, the district court declared a mistrial on Count I and subsequently granted the government's unopposed motion to dismiss that count without prejudice. Battles was sentenced to thirty months in prison, followed by two years of supervised release. The district court also ordered her to make restitution to the victim of her crimes. Battles appealed her convictions and sentence on numerous grounds. Upon careful consideration of the facts of this case and the district court record, the Tenth Circuit upheld the district court's judgment and affirmed Battles's convictions and sentence. The Court dismissed the portion of Battles's appeal pertaining to her Brady claim for lack of jurisdiction. View "United States v. Battles" on Justia Law

A grand jury indicted defendants Michael Calhoun, Tommy Davis, and William Tucker on 60 counts of wire fraud, mail fraud, and conspiracy to commit wire and mail fraud. The indictment was based on Calhoun's grand jury testimony in which he incriminated himself, Davis, and Tucker. Calhoun testified upon the advice of his counsel at the time, Tom Mills, who was paid by Texas Capital Bank (the alleged victim of the fraud). After Calhoun secured new counsel, defendants moved to quash the indictment and suppress Calhoun's grand jury testimony, arguing the indictment was obtained in violation of the Fifth Amendment Indictment Clause, the Fifth Amendment privilege against self-incrimination, and Calhoun's Sixth Amendment right to effective assistance of counsel. The district court denied the motion. In consolidated, pretrial interlocutory appeals, the defendants challenged the denial of their motion to quash, arguing that the Tenth Circuit should exercise its jurisdiction under the "collateral order" exception to the final judgment rule, ("Cohen v. Beneficial Industrial Loan Corp.," (337 U.S. 541, 546-47 (1949)). However, the Tenth Circuit concluded that the collateral order doctrine did not apply, and dismissed these appeals for lack of jurisdiction. View "United States v. Tucker" on Justia Law

Defendant-Appellant Thomas Evans was a property manager and organizer of real estate investment funds, and was owner and president of Evans Real Estate Group, LLC. V R. 212. At first, Evans' business conduct was legitimate (if highly risky), but by April 2005, Evans experienced cash flow problems and was unable to make the high interest payments to investors. He pled guilty to one count of conspiracy to commit mail and wire fraud, and was sentenced to 168 months’ imprisonment and five years’ supervised release. He appealed the sentence. Because the district court erred in calculating loss and failing to award an offense level reduction for acceptance of responsibility, the Tenth Circuit remanded the case back to the district court to vacate the sentence and resentence. View "United States v. Evans" on Justia Law

Defendant Vicki Dillard Crowe was convicted by a jury on eight counts of mail fraud, and eight counts of wire fraud for her participation in a mortgage fraud scheme. The district court sentenced defendant to sixty months' imprisonment and was ordered her to make restitution. Defendant appealed, arguing that the district court erred in calculating the amount of loss associated with her crimes for purposes of U.S.S.G. 2B1.1(b), and in denying her motion for new trial, which alleged ineffective assistance on the part of her trial counsel. Defendant's challenge to the district court's calculation of loss raised an issue of first impression for the Tenth Circuit: whether the concept of reasonable foreseeability applied to a district court’s calculation of the "credits against loss" under 2B1.1(b). The Court adopted the Second Circuit’s reasoning in "United States v. Turk," (626 F.3d 743 (2d Cir. 2010)), and held that the concept of reasonable foreseeability applies only to a district court's calculation of "actual loss" under 2B1.1(b), and not to its calculation of the "credits against loss." The Court affirmed defendant's sentence. View "United States v. Crowe" on Justia Law

The issue before the Tenth Circuit in this case stemmed from a civil-enforcement action brought by the Securities and Exchange Commission ("SEC") against Defendant-Appellant Ralph Thompson, Jr., in connection with an alleged Ponzi scheme Thompson ran through his company, Novus Technologies, L.L.C. ("Novus"). The district court granted summary judgment in favor of the SEC on several issues, including the issue of whether the instruments Novus sold investors were "securities." Thompson's single issue on appeal was that the district court ignored genuine disputes of material fact on the issue of whether the Novus instruments were securities, and that he was entitled to have a jury make that determination. After careful consideration, the Tenth Circuit concluded that under the test articulated by the U.S. Supreme Court in "Reves v. Ernst & Young" (494 U.S. 56 (1990)), the district court correctly found that the instruments Thompson sold were securities as a matter of law. View "SEC v. Thompson" on Justia Law

Plaintiff-Appellee John Niemi and several investors intended to build a large luxury ski condominium complex. Niemi was unable to find traditional financing for the project, and turned to Florida businessman, Defendant Michael Burgess. Burgess claimed to represent a European investor, Defendant-Appellee Erwin Lasshofer. As part of the funding scheme, plaintiff had to pay certain fees and pledge a collateral deposit before $250 million dollars would be loaned to him (and his business partners/investors) for the condo project. For his part, Burgess was eventually convicted and sentenced to federal prison for fraud and money laundering. Plaintiffs sued seeking return of the money they pledged, alleging the lost loan irreparably damaged its business, caused millions in lost profits, and sent its other real properties into foreclosure. Burgess maintained he took direction from Lasshofer; Lasshofer claimed he unwittingly did business with a con man. The district court granted plaintiffs' motion for a preliminary injunction effectively freezing Lasshofer's worldwide assets pending final judgment. Lasshofer appealed the grant of the preliminary injunction. Upon careful review, the Tenth Circuit concluded that plaintiffs, Niemi and individual investors in his condo project, lacked standing to bring suit. Therefore the district court erred in granting the injunction. The injunction was vacated and the case remanded for further proceedings. View "Niemi, et al v. Burgess, et al" on Justia Law

The government alleged Defendant-Appellant Richard Clark, along with other co-conspirators, manipulated shares of several penny-stocks by using false and backdated documents to make those shares publically tradable, then coordinated the trading among themselves to create the false appearance of an active market for those shares. The shares were sold after the prices surged. The conspirators laundered the proceeds through multiple bank accounts and nominees (a "pump-and-dump" scheme). Defendant was charged and convicted on multiple counts for his participation in the scheme. He appealed his conviction to the Tenth Circuit, arguing: (1) the pretrial placement of a caveat on his property violated his constitutional rights; (2) the evidence presented at trial was insufficient to support his conviction; (3) the district court erred in refusing to appoint additional or substitute counsel better versed in complex securities issues; (4) the district court erred by failing to sever his case from his co-conspirator's; and (5) his rights under the Speedy Trial Act were violated by a fourteen-month delay between filing of the indictment and the start of trial. The Tenth Circuit addressed each of Defendant's contentions in its opinion, but found no discernible error. View "United States v. Clark" on Justia Law

Defendant-Appellant George David Gordon was a former securities attorney convicted of multiple criminal charges relating to his alleged participation in a "pump-and-dump" scheme where he (along with others) violated the federal securities laws by artificially inflating the value of various stocks, then turning around and selling them for a substantial profit. The government restrained some of his property before the indictment was handed down and ultimately obtained criminal forfeiture of that property. On appeal, Defendant raised multiple issues relating to the validity of his conviction and sentence, and the propriety of the government’s conduct (both before and after trial) related to the forfeiture of his assets. In the end, the Tenth Circuit found no reversible error and affirmed Defendant's conviction and sentence, as well as the district court’s forfeiture orders. View "United States v. Gordon" on Justia Law