Opinion ID: 166613
Heading Depth: 4
Heading Rank: 2

Heading: Exclusion of Evidence from Bank Investigation

Text: 46 Nickl alleges the court erred when it concluded, under Federal Rule of Evidence 403 (Rule 403), that allegedly exculpatory evidence from an independent bank investigation was more likely to confuse than enlighten the jury. On cross-examination, defense counsel asked Sharon Smith, a C.P.A. who worked for an independent firm which investigated Steward's activities at NBA, whether her firm's investigation had revealed any evidence of fraud on the part of bank customers. The prosecution objected. Outside the presence of the jury, Smith stated her firm uncovered no evidence of customer fraud, but noted the investigation was not directed at uncovering customer fraud. The court excluded this portion of Smith's testimony under Rule 403, finding it was more likely to confuse than edify the jury. Nickl contests the district court's exclusion of evidence. 47 A district court has broad discretion in balancing the probative value of evidence against its potential prejudicial effect, and will be reversed only on a showing of abuse of that discretion. United States v. Scarborough, 128 F.3d 1373, 1378 (10th Cir.1997). A trial court abuses its discretion when it makes a clear error of judgment, exceed[s] the bounds of permissible choice, or when its decision is arbitrary, capricious or whimsical, or results in a manifestly unreasonable judgment. Moothart v. Bell, 21 F.3d 1499, 1504-05 (10th Cir.1994) (quotations omitted). 48 Rule 403 allows a trial judge to exclude relevant evidence whose probative value is substantially outweighed by its potential to, inter alia, mislead the jury or confuse the issues. Fed.R.Evid. 403. A court properly excludes evidence under Rule 403 if, after balancing its probative value against the competing considerations set forth in the rule, the court determines the costs of the evidence outweigh its benefits. S.E.C. v. Peters, 978 F.2d 1162, 1171 (10th Cir.1992) (quotations omitted). 49 In making its Rule 403 determination, the district court correctly observed uncovering customer fraud was not the objective of Smith's investigation. It reasonably concluded there would be little probative value in the proffered testimony: a jury would gain little understanding from testimony that an investigation not aimed at uncovering customer fraud did not, in fact, uncover any customer fraud. The court further determined allowing such testimony could confuse or mislead the jury on the issue of Nickl's intent to defraud the bank. Given this rationale, we are unable to conclude the decision to exclude this portion of Smith's testimony was arbitrary, capricious, or manifestly unreasonable. 50