Title: Hunter v. State

State: arkansas

Issuer: Arkansas Supreme Court

Document:

David HUNTER v. STATE of Arkansas

CR 97-529                                          ___ S.W.2d ___

                    Supreme Court of Arkansas
                Opinion delivered October 9, 1997


1.   Motions -- directed verdict -- treated as challenge to sufficiency of
     evidence. -- A motion for directed verdict is treated as a
     challenge to the sufficiency of the evidence.

2.   Evidence -- sufficiency of -- challenge to addressed first. -- The
     appellate court considers challenges to the sufficiency of the
     evidence before it addresses other allegations of trial error.

3.   Evidence -- sufficiency of -- test for determining. -- The test for
     determining the sufficiency of the evidence is whether there
     is substantial evidence to support the verdict; evidence is
     substantial if it is forceful enough to compel a conclusion
     one way or the other beyond speculation and conjecture; the
     appellate court reviews the evidence in the light most
     favorable to the party opposing the motion and considers only
     the evidence that supports the verdict.

4.   Securities regulation -- sale of unregistered securities -- shifting burden
     of proof. -- The burden of proof is on the State to show that a
     sale of, or an offer to sell, an unregistered security took
     place; once, however, the State has met that burden, the
     burden shifts to the seller to show that the security was
     either exempt from registration or was registered.
5.   Securities regulation -- sale of unregistered securities -- appellant
     failed to prove exemption -- sufficient evidence to sustain conviction. --
     Where the State clearly proved that the sale of shares of
     certain stock was a sale of securities and that the stock was
     not registered, the burden under Arkansas law then shifted to
     appellant to prove that the securities were exempt from
     registration; where appellant failed to meet this burden, the
     supreme court concluded that there was sufficient evidence to
     sustain a conviction and affirmed the trial court's decision
     on the point.

6.   Motions -- directed verdict -- movant must apprise trial court of specific
     basis on which motion is made. -- To preserve a challenge to the
     sufficiency of the evidence for appellate review, the movant
     must apprise the trial court of the specific basis on which
     the directed-verdict motion is made; proof of the specific
     element of the alleged crime must be identified in the
     directed-verdict motion to preserve the argument for appeal.

7.   Appeal & error -- parties may not change arguments on appeal. -- Parties
     may not change their argument on appeal and are limited to the
     scope and nature of their arguments made below.

8.   Appeal & error -- sufficiency argument not made before trial court -- not
     preserved for appeal. -- Where appellant's argument regarding the
     sufficiency of the evidence was not made before the trial
     court, it was not preserved for appellate review.

9.   Securities regulation -- fraud -- appellant's course of conduct culminated
     in sale of stock -- statute of limitations tolled. -- The supreme court
     concluded that the evidence of appellant's actions in offering
     stock in a company that he founded in 1987 on a fraudulent
     premise constituted the last overt act in the furtherance of
     a scheme or course of conduct as required under Ark. Code Ann.
      23-42-105(a) (Repl. 1994) and that the course of conduct
     culminated in the sale of the stock in 1993 and tolled the
     five-year statute of limitations; the supreme court affirmed
     the trial court's decision on the point.

10.  Appeal & error -- even constitutional arguments must be raised before trial
     court. -- Arguments, even constitutional ones, that are not
     raised before the trial court are barred on appeal.


     Appeal from Marion Circuit Court; Robert McCorkindale II,
Judge; affirmed.
     Hatfield & Lassiter, by: Jack T. Lassiter and Karen D. Miller,
for appellant.
     Winston Bryant, Att'y Gen., by:  Kelly Terry, Asst. Att'y
Gen., for appellee.
     Ray Thornton, Justice.
     Appellant David Hunter appeals his convictions for the sale of
unregistered securities, securities fraud, and theft of property,
for which he has been sentenced to a total of forty-six years'
imprisonment.  On appeal, he contends: (1) that the trial court
erred in denying his motion for a directed verdict because of
insufficient evidence to sustain the charge of selling unregistered
securities; (2) that it erred in denying his motion for a directed
verdict on the basis of the statute of limitations on the charge of
securities fraud; and (3) that denial of these two motions violated
his right to due process of law on the charge of theft of property. 
We find no merit in these arguments and affirm.
     Appellant claimed that he invented or owned the rights to an
invention of a patented device to prevent jackknifing of tractor-
trailer trucks.  The device was invented by O'Neal Sanders, who was
granted a patent on October 17, 1978.  Appellant met Mr. Sanders
and persuaded him to install a working model of the invention on
his horse trailer and truck.  On October 21, 1980, a purported
agreement was executed transferring Mr. Sanders's rights in the
invention to appellant.  The evidence compels the conclusion that
Mr. Sanders did not sign this purported agreement that was
eventually filed with the Patent and Trademark Office on August 13,
1987.
     Appellant incorporated Drivers Ace, Inc., in November 1987. 
Prospective investors in Drivers Ace, Inc., were informed that the
corporation held the patent rights to manufacture the device. 
Appellant continued to promote the invention, sometimes claiming
that he was the inventor.  On December 3, 1992, Drivers Ace entered
into an agreement with Marvin Engineering Co., Inc., of Inglewood,
California, granting Marvin the exclusive license to manufacture
the device worldwide.
     Peter Brocklesby witnessed this agreement on December 3.  On
January 21, 1993, Mr. Brocklesby and another investor, Norbert von
Boode, transferred $250,000 to the Drivers Ace, Inc., account in
the First National Bank of Sharp County.  This sum was to pay for
125 shares of stock in Drivers Ace at $2,000 per share, and the
stock was issued February 3, 1993.  Before the certificate was
issued and on the same day that the sum of $250,000 was deposited
in the Drivers Ace account, appellant wired $180,000 from the
Drivers Ace account to his personal account in the First Ozark
National Bank in Flippin, Arkansas.
     Appellant argues that this transaction cannot be the basis for
prosecution for securities fraud and for theft, that the charge of
securities fraud is barred by the statute of limitations, and that
the State did not prove the required elements of the crime of
selling unregistered or nonexempt securities.  We turn to our
analysis of each of these arguments.
     Appellant's first two points for reversal involve his motions
for directed verdicts, which we treat as challenges to the
sufficiency of the evidence.  Williams v. State, 329 Ark. 8, 946 S.W.2d 678 (1997).  We consider challenges to the sufficiency of
the evidence before we address other allegations of trial error. 
Harris v. State, 284 Ark. 247,