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Parties Involved:
Duncan Emery McDaniel
Appellant
United States of America
Appellee

Document Text:

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United States. Court of Appeals 

UNITED STATES COURT OF APPEALS Tenth Circuit 

UNITED STATES OF AMERICA, 

Plaintiff-Appellee, 

v. 

DUNCAN EMERY McDANIEL, 

Defendant-Appellant. 

TENTH CIRCUIT AP 

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ROBERT L. HOECKER 

Clerk 

No. 90-5095 

(D.C. No. 89-CR-39-02-E) 

( N. D. Okla~ ) 

ORDER AND JUDGMENT* 

Before McKAY, SETH and BRORBY, Circuit Judges. 

On April 6, 1989, appellant Duncan Emery McDaniel and his 

co-defendant Dorothy Mae Dowler (No. 90-5094) were indicted for 

conspiring to defraud in interstate commerce. McDaniel was tried 

and convicted of one count of conspiracy in violation of 18 u.s.c. 

§ 371 and five counts of causing interstate travel in furtherance 

of fraud in violation of 18 u.s.c. § 2314. McDaniel argues on 

appeal that the district court erred in denying his motion to 

suppress business documents and erred in denying his motion for 

judgment of acquittal n.o.v. For the reasons that follow, we 

affirm the decision of the trial court. 

*This order and judgment has no precedential value and shall not 

be cited, or used by any court within the Tenth Circuit, except 

for purposes of establishing the doctrines of the law of the case, 

res judicata, or collateral estoppel. 10th Cir. R. 36.3. 

Appellate Case: 90-5095 Document: 010110031717 Date Filed: 04/03/1991 Page: 1 
McDaniel's convictions arose from his transactions with 

co-defendant Dowler and Oklahoma businessman Lawrence Hull. 

Hull's involvement with Dowler and McDaniel began in May 1985 when 

Hull contacted Dowler seeking to obtain a $2,000,000.00 loan to 

finance an ethanol plant. Hull and Dowler signed a Loan 

Acquisition Agreement on June 6, 1985 which provided that Dowler 

would receive a finder's fee equal to 2% of the total loan and 

would have out-of-pocket expenses reimbursed up to 5% of the total 

loan amount. Hull testified that McDaniel was not a party to the 

contract. 

The day after signing the agreement Hull wired Dowler 

$3,000.00 expense money. Ten days later, based on Dowler's 

communication to Hull that the funding for the loan looked good, 

Hull personally delivered an additional check for $50,000.00 to 

Dowler. Dowler told Hull the money would be placed in an escrow 

account in Dallas. Dowler, without Hull's knowledge, deposited 

the money in an account in the First Alief Bank in Alief, Texas. 

Two to three weeks later she phoned Hull and told him the loan had 

been preliminarily approved. 

During the latter months of 1985, Hull met with Dowler and 

McDaniel to further discuss the loan. Hull testified that he 

first met McDaniel at an August 20, 1985 meeting in New York City. 

McDaniel was introduced as the person with the overseas money 

contacts necessary to secure the loan. Hull specifically 

discussed the loan with McDaniel at a September 4, 1985 meeting in 

Dallas, Texas and at a September 12, 1985 meeting in Myrtle Beach, 

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South Carolina. Hull testified that at the September 12 meeting 

McDaniel told Hull that everything was preliminarily approved and 

all that was needed was completion of the paper work and 

transmittal of the funds. McDaniel and Dowler relayed this same 

information to Hull at additional meetings in Myrtle Beach on 

October 3, 1985 and October 26, 1985. 

Hull never met personally with Dowler or McDaniel after the 

October 26 meeting. Hull did have subsequent phone conversations 

with both Dowler and McDaniel and was again told that the loan was 

proceeding and that there was no need for the escrow money to be 

paid back to him. By late November or early December 1985, 

however, Hull discovered that McDaniel and Dowler were no longer 

residing in Myrtle Beach. Except for a single phone conversation 

with Dowler in California, Hull never heard from Dowler or 

McDaniel again. His $50,000 escrow money was not returned. 

The alleged unconstitutional search of the business records 

occurred at a Newport Beach, California apartment rented by 

Dowler. The evidence from the Motion to Suppress hearing 

established that the apartment was rented by Dowler on a month-tomonth basis beginning November 1, 1986. The rental deposit 

receipt listed Dowler and her daughter as the occupants of the 

apartment and listed Robert Lucas, her chauffeur, as the person to 

contact in case of an emergency. 

Dowler testified that she planned to live in the Newport 

Beach apartment with McDaniel after McDaniel returned from 

business in China. She stated that she moved McDaniel's personal 

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belongings and business documents from the apartment Dowler and 

McDaniel previously shared to the Newport Beach apartment. 

McDaniel's business records were commingled with Dowler's. 

Dowler failed to pay the December rent. On December 30, 

1986, the apartment manager moved the contents of the apartment, 

including the boxes of documents, into a storage locker at the 

apartment complex. The documents remained in the locker until 

February 26, 1987 when they were seized by the Newport Beach 

police. The FBI obtained the documents from the Newport Beach 

police on January 26, 1988. 

Standing 

McDaniel argues that he had standing to contest the search 

because he had a reasonable expectation of privacy in his own 

business records. The district court rejected this argument and 

found that McDaniel lacked standing to challenge the search of the 

documents because he had no expectation of privacy in the Newport 

Beach apartment or the apartment manager's storage locker. 

We accept the factual findings underlying the district 

court's holding unless they are clearly erroneous. United States 

v. Rubio-Rivera, 917 F.2d 1271 (10th Cir.). Because standing is a 

matter of substantive Fourth Amendment law, Rakas v. Illinois, 439 

U.S. 128, we review de nova the ultimate determination of 

reasonableness under the Fourth Amendment. United States v. 

Arango, 912 F.2d 441 (10th Cir.). 

To have standing to challenge the search, McDaniel must 

demonstrate that his own constitutional rights have been violated. 

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Appellate Case: 90-5095 Document: 010110031717 Date Filed: 04/03/1991 Page: 4 
United States v. Erwin, 875 F.2d 268, 270 (10th Cir.). Standing 

is determined by analyzing "whether the individual, by his conduct 

has 'exhibited an actual (subjective) expectation of privacy,' 

. and whether the individual's subjective expectation of 

privacy is 'one that society is prepared to recognize as 

"reasonable."'" Smith v. Maryland, 442 U.S. 735, 740 (quoting 

Katz v. United States, 389 U.S. 347, 361). The expectation of 

privacy must be demonstrated in the area searched, not merely in 

the items seized. United States v. Skowronski, 827 F.2d 1414, 

1418 (10th Cir.) (citing United States v. Salvucci, 448 U.S. 83, 

93) . 

Applying these principles to the present case, McDaniel's 

argument must fail. McDaniel never demonstrated an expectation of 

privacy in the apartment rented by Dowler. The testimony at the 

suppression hearing established that McDaniel was in China when 

the rental agreement was signed. McDaniel never stepped foot in 

the Newport Beach apartment. 

On his return to California in December 1986, McDaniel lived 

in San Francisco, making no effort to obtain his belongings from 

the Newport Beach apartment while they were there. While it is 

possible for someone other than the owner or lessee to have an 

expectation of privacy in an apartment, see Rakas, 439 U.S. at 142 

(explaining Jones v. United States, 362 U.S. 257, 263), the 

district court properly determined that this did not occur in the 

present case. 

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McDaniel correctly notes that he has a possessory interest in 

his business papers. However, he incorrectly equates this 

possessory interest with a right to privacy in the boxes and file 

cabinet containing the papers. Dowler, not McDaniel, placed the 

records in the boxes and file cabinets and moved them to the 

Newport Beach apartment. McDaniel did not purport to control and 

had no ability to control the documents or exclude others from 

gaining access to the documents. See Rakas 439 U.S. at 143, 

n.12. Viewed objectively, this evidence is insufficient to 

establish a reasonable expectation of privacy in the boxes and 

file cabinets. 

Sufficiency of the Evidence 

McDaniel also contests the district court's denial of his 

motion for judgment of acquittal n.o.v. In reviewing McDaniel's 

claim, we consider all proof, direct and circumstantial, in the 

light most favorable to the government to determine if a 

reasonable jury could find McDaniel guilty beyond a reasonable 

doubt. United States v. Culpepper, 834 F.2d 879, 881 (10th Cir.); 

United States v. Hooks, 780 F.2d 1526, 1531 (10th Cir.). 

McDaniel initially challenges the sufficiency of the evidence 

supporting his conspiracy conviction. We have previously held 

that a conspiracy conviction must be based on more than a mere 

suspicion of guilt and cannot be obtained through an accumulation 

of inferences. See United States v. Fox, 902 F.2d 1508, 1513 

(10th Cir.). The government had to prove that a conspiracy 

existed, McDaniel knew of the conspiracy, and McDaniel knowingly 

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participated in the conspiracy. However, once an overall 

conspiracy was established, the jury only had to find "slight 

evidence" to implicate McDaniel as a co-conspirator. See 

United States v. Troutman, 814 F.2d 1428, 1446 (10th Cir.). 

McDaniel argues that insufficient evidence was introduced to 

establish an overall conspiracy. He argues that Dowler's 

fraudulent transactions with Hull occurred between May 1985 and 

July 1985, a month before he became involved with Dowler. He 

contends that most of the $50,000.00 escrow money was spent before 

the end of June 1985. 

While McDaniel correctly outlines the time frame of his 

involvement with Dowler, his non-participation in the initial 

Hull-Dowler transactions does not preclude his participation in an 

ongoing conspiracy. From the evidence introduced at trial, it 

appears that Dowler was not working alone when she made her 

initial contacts with Hull. Hull testified that Alonzo Owens 

first introduced Hull to Dowler. Dowler and McDaniel's joint 

statement to the FBI in May 1988, indicates that Owens was the 

person who received the initial $3,000.00 expense money paid by 

Hull to Dowler. There also is some evidence that an additional 

person, referred to as "Bubba", was involved with Dowler and Owens 

during their initial transactions with Hull. 

Viewed in the light most favorable to the government, 

Dowler's relationship with Owens by itself is sufficient for a 

reasonable jury to infer the beginning of a conspiracy. 

McDaniel's subsequent meetings with Dowler and Hull are sufficient 

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to link him with the ongoing conspiracy to defraud Hull. It is 

well established that a party may join an ongoing conspiracy in 

progress and become criminally liable for acts done in furtherance 

of the conspiracy. See United States v. Gamble, 541 F.2d 873 

(10th Cir.). A jury could reasonably infer that McDaniel knew of 

the conspiracy to defraud Hull and knowingly participated in it. 

Sufficient evidence was also introduced to support McDaniel's 

conviction on substantive counts 3, 4, 5, 6 and 7 of the 

indictment. Hull testified that he traveled to each of the 

locations charged in the indictment at the request of Dowler and 

McDaniel to discuss financing the loan. While McDaniel may not 

have initiated those meetings, McDaniel was present at each 

meeting and had some direct contact with Hull. McDaniel's 

participation ranged from being introduced as the person with 

overseas money contacts at the New York meeting (Count III) to the 

person who told Hull that the loan was preliminarily approved at 

the first Myrtle Beach meeting (Count V). This participation was 

sufficient for a reasonable jury to find McDaniel guilty beyond a 

reasonable doubt of the substantive charges. 

Accordingly, the rulings of the district court denying 

McDaniel's motion to suppress and denying his motion for judgment 

of acquittal were correct and the judgment is AFFIRMED. 

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Entered for the Court 

Oliver Seth 

Circuit Judge 

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