Title: State v. Philbrook

State: maine

Issuer: Maine Supreme Court

Document:

MAINE SUPREME JUDICIAL COURT 
Reporter of Decisions 
Decision: 
2013 ME 86 
Docket: 
Aro-12-586 
Submitted 
  On Briefs: 
September 26, 2013 
Decided: 
October 24, 2013 
 
Panel: 
SAUFLEY, C.J., and ALEXANDER, SILVER, MEAD, GORMAN, and JABAR, JJ. 
 
 
STATE OF MAINE 
 
v. 
 
JAMES A. PHILBROOK 
 
MEAD, J. 
 
[¶1]  James A. Philbrook appeals from a judgment of conviction entered by 
the trial court (Hunter, J.) on a jury verdict convicting him of theft by 
misapplication of property (Class B), 17-A M.R.S. § 358(1)(B)(1) (2012), and 
securities fraud (Class C), 32 M.R.S. §§ 16501, 16508 (2012).  Philbrook contends 
that the court’s jury instructions shifted the burden of proof onto him to prove his 
innocence.  We affirm the judgment. 
I.  BACKGROUND 
 
[¶2]  Viewed in the light most favorable to the jury’s verdict, the record 
supports the following facts.  See State v. Patton, 2012 ME 101, ¶ 2, 50 A.3d 544.  
James Philbrook, a licensed stockbroker for more than thirty years prior to 
December 2006, was introduced to Arlene and Roland Albert, residents of 
St. Agatha, by the Alberts’ long-time accountant when they decided to seek help 
 
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with estate planning.  Arlene Albert is a retired registered nurse, and Roland Albert 
is a retired potato farmer.  Philbrook began an ongoing professional relationship 
with the Alberts in 1995, providing them with estate planning services and selling 
them insurance annuities.  He met with the Alberts once a year at their home to 
review their portfolio and discuss any changes. 
 
[¶3]  In June 2005, Philbrook called the Alberts and said that he had an 
interesting investment opportunity that he wanted to discuss with them.  They 
agreed to a meeting, and about a week later Philbrook described the investment as 
they sat around the Alberts’ kitchen table.  Arlene testified that “he said it was an 
investment involving a Pay-Per-View [PPV] program with Carmen Electra that 
was going to be taking place in Florida and . . . they needed the funds to promote 
this [PPV] program that was going to take place and he was looking for investors.”  
Philbrook told them that “whatever we invested in this deal, that we would double 
our moneys . . . [and] we would have a substantial return.” 
 
[¶4]  The Alberts agreed to participate after Philbrook assured them that the 
venture was a safe investment, and in two transactions, one in June and the other in 
July, they wired him a total of $145,000.  The Alberts made the second investment 
after Philbrook presented them with a limited-time “triple bonus” offer, which he 
had drafted, purporting to qualify them for a higher level of return if they invested 
more money soon. 
 
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[¶5]  Philbrook did not invest any of the Alberts’ money in the PPV venture, 
but instead used it to repay money that his son had embezzled from his employer, 
and for Philbrook’s own purposes.  Philbrook argued at trial that the money the 
Alberts gave him was a personal loan that he intended to repay with proceeds from 
his personal investment in the PPV venture, an assertion that the jury clearly 
rejected. 
 
[¶6]  For the next year, the Alberts thought their investment was doing well.  
In July 2006, Philbrook returned with a new investment opportunity that Arlene 
said he described as “something to help college students with student loans and 
something for them for their education.”  Philbrook gave the Alberts a document 
that he had generated showing that in thirty-four months they would receive a 
$125,000 payout on an investment of $50,000.  He also had the Alberts sign a 
confidentiality agreement providing that they would be subject to a $2,000,000 
penalty if they discussed the education venture with anyone other than their son.  
The Alberts then gave Philbrook $50,000.  In a case brought against him by the 
New Hampshire Bureau of Securities Regulation, Philbrook said that he used the 
money “to meet [his] ongoing expenses.” 
 
[¶7]  In December 2008, Philbrook sent the Alberts a letter saying that 
national economic conditions prevented him from repaying them immediately, and 
that those conditions were unlikely to change for several months.  Eventually the 
 
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Alberts went to the authorities.  Philbrook never repaid any of the $195,000 that 
they had invested with him. 
 
[¶8]  In January 2011, Philbrook was indicted on one count of theft by 
misapplication of property and one count of securities fraud.  The case went to trial 
and the jury returned a verdict of guilty on both counts.  At a sentencing hearing, 
the court entered judgment and sentenced Philbrook on the theft by misapplication 
of property conviction to eight years’ imprisonment, with all but three years 
suspended, and three years of probation with a special condition that he pay 
$195,000 in restitution.  On the securities fraud conviction the court sentenced 
Philbrook to three years concurrent.  Philbrook filed this appeal and an application 
to allow an appeal of sentence, which we denied. 
II.  DISCUSSION 
 
[¶9]  We address only Philbrook’s argument that the jury instructions 
misstated the burden of proof.  After considering his other contentions that (1) the 
court’s instruction on the charge of theft by misapplication of property omitted a 
required element, and (2) the evidence was insufficient to support the judgment, 
we find no error and do not discuss those issues further. 
 
[¶10]  The court used a written verdict form that, for each of the two 
charges, asked the jury to complete the statement, “With regard to the charge . . . 
 
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the jury finds that the Defendant is:” by checking one of two options, “Guilty” or 
“Not Guilty.” 
 
[¶11]  In its verbal instructions, the court said, concerning the charge of theft 
by misapplication: 
[W]e want you to make the basic determination as to whether the 
central elements of the offense have been established beyond a 
reasonable doubt or not.  If you find that the offense has been 
committed, you have a verdict of guilty.  If you find that the offense 
has not been committed, you will return a verdict of not guilty. 
 
Concerning the charge of securities fraud, the court instructed the jury to “answer 
the same basic question.  Has the State proved the required legal elements beyond 
a reasonable doubt or not?” 
 
[¶12]  Philbrook contends that the instruction “[i]f you find that the offense 
has not been committed, you will return a verdict of not guilty” improperly shifted 
the burden of proof by requiring the jury to find that he was not guilty beyond a 
reasonable doubt before acquitting him.  If he is correct that such burden-shifting 
occurred, the error deprived him of due process.  State v. McNally, 2007 ME 66, 
¶ 10, 922 A.2d 479.  Although Philbrook did not object to the instructions, 
meaning that we review them for obvious error, M.R. Crim. P. 52(b); State v. 
Burns, 2011 ME 92, ¶ 6, 26 A.3d 817, “[a] jury instruction placing any burden on a 
defendant to prove his innocence would be clearly erroneous.”  State v. Perry, 
486 A.2d 154, 156 (Me. 1985).  We review jury instructions “as a whole to ensure 
 
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that they informed the jury correctly and fairly in all necessary respects of the 
governing law.”  Patton, 2012 ME 101, ¶ 34, 50 A.3d 544 (quotation marks 
omitted). 
 
[¶13]  Philbrook relies on our decision in McNally, where we held that an 
instruction that asked the jury to determine “whether you find beyond a reasonable 
doubt that [the crime charged] has occurred . . . or not” deprived the defendant of 
the presumption of innocence when “[c]onsidered together” with a verdict form 
that could be read to ask the jury which option, guilty or not guilty, had been 
proved beyond a reasonable doubt.  2007 ME 66, ¶¶ 4, 10, 922 A.2d 479.  We 
explained that “if used, a [verdict] form is best limited to direct questions that 
simply ask the jury to report whether they find the defendant guilty or not guilty as 
to each charge.”  Id. ¶ 9; see Alexander, Maine Jury Instruction Manual § 5-4A at 
5-9 (2013 ed.). 
 
[¶14]  Philbrook’s reliance on McNally is misplaced.  Unlike the verdict 
form found to have violated the defendant’s due process rights in that case, the 
verdict form used by the trial court here did not recite the burden of proof; instead, 
it complied with our guidance in McNally by simply asking the jury to report its 
verdict.  Absent a verdict form that might buttress imprecision in the court’s verbal 
instructions, there is no obvious error in the instructions the court gave, because as 
a whole they correctly stated the law—the jury was to determine whether the 
 
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elements of the crime were proved beyond a reasonable doubt, and if so, return a 
verdict of guilty, and if not, return a verdict of not guilty.  Furthermore, the court 
correctly stated the State’s burden of proof and Philbrook’s presumption of 
innocence several times during jury selection, at the beginning of the trial, in its 
final instructions, and in its written instructions sent into the jury room in response 
to a note. 
 
[¶15]  We note, however, that asking the jury to decide whether an offense 
“has been committed,” although it did not shift the burden of proof to Philbrook in 
this case, is not a precise description of the jury’s role.  A jury in a criminal case 
has one central task: to determine whether, applying the law as given to it by the 
court, the State has proved each element of the charge beyond a reasonable doubt.  
Explaining the jury’s charge in any other terms, for example asking the jury 
whether it finds that the offense has been proved beyond a reasonable doubt “or 
not,” or whether the jury “find[s] that the offense has been committed,” risks 
introducing confusion that may violate the defendant’s due process rights in the 
way found fatal to the judgment in McNally. 
 
[¶16]  Because no due process violation occurred in this case, we affirm the 
judgment.  Nevertheless, the best practice is for the trial court to inform the jury in 
its instructions that it may return a verdict of guilty only if it finds that the State has 
proved each element of the offense beyond a reasonable doubt, and that if the State 
 
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has failed to prove any of the elements of the offense beyond a reasonable doubt, it 
must return a verdict of not guilty.  See Alexander, Maine Jury Instruction Manual 
§ 6-7 at 6-12 & comment (2013 ed.). 
 
The entry is: 
Judgment affirmed. 
 
____________________________________ 
 
 
On the briefs: 
 
Sarah LeClaire, Esq., Presque Isle, for appellant James Philbrook 
 
Janet T. Mills, Attorney General, and Leanne Robbin, Asst. Atty. 
Gen., Office of Attorney General, Augusta, for appellee State of Maine  
 
 
 
Aroostook County Superior Court docket number CR-2011-10 
FOR CLERK REFERENCE ONLY