Opinion ID: 197023
Heading Depth: 2
Heading Rank: 2

Heading: Sufficiency of the Evidence and Venue (Franchise Conspiracy Count )

Text: 25 The jury found that both appellants participated in the dealership franchise conspiracy alleged in Count II. 6 Neither appellant seriously disputes that he conspired with Cardiges. Rather, their principal contention is that there was insufficient evidence to prove, beyond a reasonable doubt, that they both participated in the same conspiracy with Pedersen, which, they maintain, was essential to establish both the substantive conspiracy charge in Count II and proper venue in New Hampshire. As their contention confuses the standards of proof applicable to these two distinct issues, and the record demonstrates that the government readily met both, appellants' convictions under Count II must be affirmed.
26 The unchallenged instructions apprised the jury that the government was required to prove four elements, beyond a reasonable doubt, in order to prevail on Count II: (i) two or more persons entered into the unlawful agreement charged in the indictment; (ii) the particular defendant, knowing the purpose of the agreement, knowingly and willfully became a member of the conspiracy; (iii) some member of the conspiracy knowingly committed at least one alleged overt act; and (iv) at least one overt act was committed in furtherance of the conspiracy. See, e.g., United States v. Sawyer, 85 F.3d 713, 714 (1st Cir.1996) (citing United States v. Frankhauser, 80 F.3d 641, 653 (1st Cir.1996)); United States v. Brandon, 17 F.3d 409, 428 (1st Cir.), cert. denied, 513 U.S. 820, 115 S.Ct. 80, 130 L.Ed.2d 34 (1994). Thus, the jury need only have found beyond a reasonable doubt that each appellant conspired with at least one other person (e.g., Cardiges), and not necessarily with Pedersen as well. 27 Putting aside for the moment the question of guilt, see infra Section II.B.3, it is clear that adequate evidence of Pedersen's role in the dealer franchise conspiracy was essential to establish New Hampshire as a proper venue for Count II. 7 Without objection, the district court instructed the jury that the government must establish, by a preponderance of the evidence (rather than beyond a reasonable doubt), that Pedersen, Billmyer and Josleyn joined the Count II conspiracy and that Pedersen committed the alleged overt act involving the Acura dealership in Nashua, New Hampshire. See United States v. Cordero, 668 F.2d 32, 45 n. 18 (1st Cir.1981) (applying preponderance standard, as venue is not an element of conspiracy offense); supra note 6. Thus, consistent with the unchallenged jury instructions on conspiracy and venue, as well as applicable law, the government could establish venue in New Hampshire by only a preponderance of the evidence, but it was required to prove each appellant's participation in the conspiracy beyond a reasonable doubt. 8
28 We will uphold the verdicts under Count II if a rational juror could have found each substantive element of the alleged conspiracy beyond a reasonable doubt, United States v. DiMarzo, 80 F.3d 656, 660 (1st Cir.), cert. denied, --- U.S. ----, 117 S.Ct. 259, 136 L.Ed.2d 185 (1996), and proper venue by a preponderance of the evidence, Cordero, 668 F.2d at 45 n. 18. All credibility issues are to be resolved, and every reasonable inference drawn, in the light most favorable to the verdict. DiMarzo, 80 F.3d at 660; United States v. Lam Kwong-Wah, 924 F.2d 298, 301 (D.C.Cir.1991) (venue). A thorough review of the entire record discloses ample evidentiary support for the verdicts against each appellant.
29 The Count II conspiracy charge required proof that the particular defendant and at least one other person expressly or tacitly agreed to commit a federal offense. DiMarzo, 80 F.3d at 660. The government must have shown that the defendant voluntarily participated to promote a criminal objective. Brandon, 17 F.3d at 428. When, as in this case, mail fraud is an alleged goal of the conspiracy, the government must prove either the intent to use the mails or that such use was reasonably foreseeable. Yefsky, 994 F.2d at 890; see also United States v. Dray, 901 F.2d 1132, 1137 (1st Cir.) (noting that intent element in conspiracy differs from substantive mail fraud), cert. denied, 498 U.S. 895, 111 S.Ct. 245, 112 L.Ed.2d 204 (1990). A particular defendant need not have been familiar with all the details of the conspiracy or with the identities of all other conspirators. United States v. Innamorati, 996 F.2d 456, 470 (1st Cir.1993), cert. denied, 510 U.S. 1120, 114 S.Ct. 1072, 1073, 127 L.Ed.2d 391 (1994); United States v. Bello-Perez, 977 F.2d 664, 668 (1st Cir.1992). 30 A brief overview leaves no reasonable doubt that Billmyer, Cardiges, and other Honda sales executives, respectively, conspired to defraud Honda by accepting valuable consideration for awarding dealership franchises and other preferential treatment to Honda dealers and prospective dealers. 31
32 As early as 1979, while Billmyer was the eastern regional sales manager, Cardiges, as zone manager for the mid-Atlantic states, accepted a $10,000 payment from a Honda dealer in Philadelphia, and split it with Billmyer. In late 1979 or early 1980, Cardiges presented Billmyer with a gold Rolex watch worth as much as $15,000 from a large Honda dealer in the Washington, D.C. area. Beginning with the 1984 holiday season and continuing through 1992, Cardiges received $20,000 to $25,000 each year from John Rosatti, a Honda dealer in New York City. Rosatti told Cardiges that he was paying Billmyer also, because, as Cardiges testified at trial, like other dealers Rosatti wanted favorable treatment, wanted more automobiles, more franchises, and wanted the ability to have the ear of the people who were in power at Honda.Cardiges and Billmyer both helped a dealer named Rick Hendrick acquire approximately thirty Honda and Acura franchises in various states, including Texas, Georgia, and the Carolinas. In return, Hendrick helped Cardiges buy a California residence from which Cardiges later realized a $250,000 gain. Thereafter, Hendrick defrayed approximately $150,000 in interest payments on a loan Cardiges had obtained to buy a $700,000 home in Laguna Hills, California. During this same 1989-92 time frame, Hendrick intimated to Cardiges that he was involved in financing Billmyer's home in Palm Springs as well. Cardiges also learned from Billmyer that Hendrick had provided Billmyer with a top-of-the-line BMW. 33 Cardiges described periodic payoffs from one Marty Luftgarten, who owned dealerships in New Jersey, Philadelphia, and southern California. For example, at the grand opening of a Luftgarten dealership during the mid-1980s, Billmyer, Cardiges, and two other Honda sales managers, Bill Kutchera and Jeff Conway, gathered in a conference room where Luftgarten handed each an envelope containing $5,000 in cash. Around the holiday season, another dealer customarily sent Cardiges $5,000 gift certificates from Neiman-Marcus for both Cardiges and Billmyer. See Boylan, 898 F.2d at 242 (noting that defendants often cooperated with one another by collecting payments). The record is replete with other evidence of cash payments from dealers and lavish shopping trips to Hong Kong. 34
35 Similarly, there was ample evidence to enable a rational jury to find beyond a reasonable doubt that Josleyn conspired with Cardiges and others to defraud Honda in connection with the Honda dealership franchises. In early 1991, while zone manager for the west coast, Josleyn arranged for a friend back east, Joe Pope, to pay $150,000 for the open point in Elk Grove, California. Josleyn approached Cardiges, national sales manager, and Robert Rivers, regional manager for the western United States, and advised that there would be money in it for all of them if Pope were to receive the Elk Grove dealership. Thereafter, Cardiges, Rivers, and Josleyn, in direct violation of Honda procedure, decided not to prospect for suitable dealership candidates, and awarded the Elk Grove franchise outright to Pope. As promised, Pope issued a $150,000 check payable to Gary & Associates, a company controlled by Josleyn and his brother Gary. Josleyn in turn gave Cardiges and Rivers each $50,000 in cash. 36 Cardiges testified that Ed Temple, a former Honda zone manager, approached him in the summer of 1991 in behalf of Bob Frink, a dealer interested in the Folsom, California point. Temple had accepted payoffs from dealers while employed by Honda, and after leaving the company in 1989 established a firm--Blakely Consultants--to facilitate payments to Honda executives from dealers seeking new Honda franchises. Simply put, Temple told Cardiges that Frink was willing to pay Cardiges and Josleyn for the Folsom dealership. On August 5, 1991, Cardiges signed the Folsom LOI, and on the same day Frink paid Blakely Consultants $500,000 for services rendered. Three days later, Temple wrote a $166,666 check to Magnum Marketing, a company owned by Josleyn. Cardiges reported $166,666 from Blakely Consultants on his own 1991 income tax return, although Temple had agreed to hold Cardiges' one-third share until Cardiges left Honda. 37 We need belabor the point no further, as there was ample evidence to enable the jury reasonably to conclude, beyond a reasonable doubt, that Josleyn was a member of the Count II dealership franchise conspiracy. See Boylan, 898 F.2d at 242.
38 As a general rule, venue in a conspiracy case depends upon whether an overt act in furtherance of the alleged conspiracy occurred in the trial district. United States v. Uribe, 890 F.2d 554, 558 (1st Cir.1989); see 18 U.S.C. § 3237(a) (1994). The defendant need not have been physically present in the trial district during the conspiracy. United States v. Santiago, 83 F.3d 20, 24-25 (1st Cir.1996); see, e.g., Cordero, 668 F.2d at 43-44 (furthering drug importation conspiracy with phone calls to undercover DEA agent in Puerto Rico); cf. United States v. Georgacarakos, 988 F.2d 1289, 1294 (1st Cir.1993) (contrasting venue for group and individual crimes). The government acknowledges that venue was proper in the District of New Hampshire only if there was enough evidence for a rational jury to find it more likely than not that Pedersen, Josleyn and Billmyer belonged to the Count II conspiracy. 39 Upon joining Honda as a district sales manager in July 1979, see supra notes 2 & 3, Pedersen learned that Honda policy prohibited sales executives from awarding LOIs for personal gain and from accepting gifts valued at more than $25 from dealers. In keeping with Honda policy, Pedersen objected in December 1979 when Bill Lia, a dealer in upstate New York, stuffed an envelope containing cash into Pedersen's pocket. Although Pedersen threatened to report the incident, he relented when Lia told him not to worry because Lia had already handled the zone. Moreover, Pedersen knew at the time that both his immediate supervisor, Northeast Zone Manager Bill Kutchera, and Billmyer, regional manager for the eastern United States, as well as Cardiges, worked at Honda headquarters in New Jersey. In fact, when Pedersen told Kutchera about the cash bribe tendered by Lia, Kutchera advised Pedersen to ask for a gift certificate in place of the cash. Accordingly, Pedersen ultimately accepted a $300 gift certificate from Lia with Kutchera's explicit approval. Around this same time, Kutchera also told Pedersen that during the course of the previous year he had received two Rolex watches, a cruise, furniture, and other gifts, valued at $13,000, from various dealers. 40 Pedersen testified that he frequently discussed dealer payoffs with Roger Novelly and Larry Finley, his Honda supervisors in Ohio. Novelly, the assistant zone manager, specifically told Pedersen that Billmyer and Cardiges were being taken care of by dealers, and Finley, the zone manager, admitted that Tom Bohlander had paid him for the Honda open point dealership franchise in West Cleveland. 9 See, e.g., Boylan, 898 F.2d at 243 (noting that tacit accord among alleged conspirators is permissibly inferred from evidence that defendants often spoke to their victims about other victims or other defendants in words which plainly revealed that the crimes were interdependent). Based on this evidence, and there was more, the jury would have been permitted to draw the reasonable inference that Pedersen and his various supervisors over the years had developed a shared understanding of an unwritten policy at Honda: dealers had to pay Billmyer and Cardiges, as well as other sales executives in the chain of command, in order to receive a Honda or Acura franchise or other favorable treatment. Id. 41 John Orsini, a Honda and Acura dealer in Connecticut, provided corroborative testimony at trial, characterizing the kickbacks he had made to Billmyer, Pedersen, and Damien Budnick, Pedersen's subordinate, as a way of doing business with Honda. At Budnick's suggestion, Orsini met with Billmyer in September 1987 to discuss obtaining another Acura dealership. A few weeks later, Billmyer offered Orsini a franchise in Nanuet, New York, if Orsini created a no-show job for Billmyer's friend, Douglas T. Richert, at $1,000 per week. After Orsini accepted the Billmyer proposal, he received the Nanuet LOI. 42 Around the same time, Orsini discussed with Budnick and Pedersen the possibility that Orsini might obtain a new dealership franchise in Salem, New Hampshire. According to Pedersen, Orsini and other dealers routinely and unilaterally mentioned Billmyer's name in conversation, as a means of impress[ing] on Pedersen the dealers' established connections with higher-level Honda sales managers. Orsini told Pedersen that he would be willing to pay for the Salem franchise, but not the $50,000 demanded by Budnick. After agreeing to help secure the Salem dealership for Orsini in February 1988, Pedersen received between $2,000 and $4,000 in cash from Orsini. Thus, given the circumstantial evidence that both Billmyer and Pedersen shared a common goal or plan to defraud Honda by accepting illicit consideration for awarding new dealership franchises, the jury reasonably could infer, by a preponderance of the evidence, that Billmyer and Pedersen defrauded Honda in connection with the Salem, New Hampshire LOI by accepting payoffs from a common source, Orsini. See, e.g., Brandon, 17 F.3d at 450 (finding single conspiracy, despite variations in details and tactics, where main objective, structure, intended victim, and modus operandi remained constant); supra Section I. 43 In addition to accepting illicit payments from Lia and Orsini, the record demonstrates, by a preponderance of the evidence, that Pedersen committed an overt act in New Hampshire in furtherance of the Count II conspiracy, by accepting a free Acura Integra from Bohlander's West Cleveland, Ohio, dealership in 1986. After Bohlander and Pedersen became friends, Pedersen agreed to help Bohlander acquire more Acura dealerships in exchange for a silent ownership interest in a Nashua, New Hampshire, dealership. Pedersen recommended Bohlander for the new Nashua franchise, and in due course Bohlander received it. Although Pedersen later declined an ownership interest in the Nashua dealership, he nonetheless let Bohlander pay roughly $18,000 in college tuition fees for Pedersen's son. Thus, the evidence sufficed to demonstrate, by a preponderance, that venue was proper in the District of New Hampshire. See Uribe, 890 F.2d at 558. 44 Finally, there was evidence from which a rational jury reasonably could have inferred, by a preponderance of the evidence, that Bohlander routinely paid Billmyer and Cardiges as well. Pedersen described a card game at Bohlander's Florida condominium in February 1991, during which Bohlander and Lou Tecco, a dealer associated with Marty Luftgarten, talked about paying bribes as a way of doing business with Honda, and noted that Billmyer and Cardiges had to be paid in order to get dealerships and other favorable treatment. Along with the evidence that Bohlander had paid Finley for the West Cleveland dealership and that dealers commonly bribed sales executives at each successive level, see supra at p. 1192, Pedersen's testimony permitted the jury reasonably to conclude that it was more likely than not that Bohlander had paid Billmyer, the Acura Division head, as well as Pedersen, in return for the Nashua dealership in 1987. Thus, the similarity in the pattern of fraudulent transactions relating to new dealership franchises, the common core of insider participants, and the temporal overlap would enable a rational jury reasonably to infer, under the applicable preponderance standard, that Pedersen, Billmyer, Josleyn, and Cardiges agreed, at least tacitly, to defraud Honda by accepting illicit consideration from candidates for new Honda dealership franchises in direct violation of established Honda policy and procedures. See Morrow, 39 F.3d at 1233-34; Bello-Perez, 977 F.2d at 668 (noting that conspirators need not know all co-conspirators); see also United States v. Richerson, 833 F.2d 1147, 1152-54 (5th Cir.1987).