Opinion ID: 145469
Heading Depth: 2
Heading Rank: 1

Heading: Axiom Trust Evidence

Text: The district court permitted the government to introduce evidence of Hall's involvement in the Axiom Trust notwithstanding the fact that the charged crimes only concerned the Kingsley Trust. The district court held Hall's actions with respect to the two trusts were inextricably intertwined, and thus evidence of the Axiom Trust was intrinsic to the allegations in the indictment. [7] Hall maintains the Axiom and Kingsley Trusts were not inextricably intertwined. Hall emphasizes the Axiom and Kingsley Trusts were separated in time, place, and parties. Hall stresses (1) activity in Axiom Trust ended in early 2004 and activity in the Kingsley Trust beg[a]n in May 2006; (2) the Axiom Trust was located in Texas, and the Kingsley Trust was located in Missouri; (3) the Axiom and Kingsley Trusts had different victims; and (4) Cooper was not involved in the Axiom Trust. We have consistently held `crimes or acts which are inextricably intertwined with the charged crime are not extrinsic and Rule 404(b) does not apply.' United States v. Clarke, 564 F.3d 949, 957 (8th Cir.2009) (quoting United States v. Aldridge, 561 F.3d 759, 766 (8th Cir.2009)). Evidence of other crimes or acts is inextricably intertwined if it is an integral part of the immediate context of the crime charged. United States v. Rolett, 151 F.3d 787, 791 (8th Cir.1998). We review the district court's decision to admit the evidence of the Axiom Trust as intrinsic evidence for an abuse of discretion. See United States v. O'Dell, 204 F.3d 829, 833 (8th Cir.2000) (citing United States v. McMurray, 34 F.3d 1405, 1411 (8th Cir. 1994)). The Axiom and Kingsley Trusts were inextricably intertwined, and evidence of the Axiom Trust was intrinsic to the indictment. See Clarke, 564 F.3d at 957. Jenkins registered the two trusts at the same time, at the same place, and with the same business address. Hall operated the Axiom and Kingsley Trusts in the same manner. Hall (1) made similar false representations to victims of each trust; (2) kept his own name off the trusts' bank accounts and other important documents; (3) controlled the trusts through conduits; and (4) spent investors' funds on personal expenseswithout investing a dime. While Hall may have shifted his focus from the Axiom Trust to the Kingsley Trust around 2006, in reality the two trusts were integral parts of the same fraudulent scheme Hall created in 2003. See Rolett, 151 F.3d at 791. Hall lured T.J. into his scheme via the Axiom Trust and then lulled T.J. into inaction with the Kingsley Trust, directly linking the two trusts. Cf. United States v. Freeman, 434 F.3d 369, 374 (5th Cir.2005) (holding the district court did not abuse its discretion in admitting evidence of a second fraudulent scheme, in part, because funds from one scheme were used to lull investors into another scheme). Failure to introduce evidence of the Axiom Trust might have created a gap in the jury's understanding. The Axiom Trust evidence explained why the Kingsley Trust lay dormant from 2003 to 2006, and why Hall moved the Kingsley Trust's operations to Missouri in 2006. In short, once Hall had deceived enough investors in Texas with the Axiom Trust, Hall inferentially needed to rename the scheme and move to another location. Cf. United States v. McGuire, 45 F.3d 1177, 1188 (8th Cir.1995) (determining evidence of prior robberies was intrinsic in part because it explain[ed] the circumstances of the charged murder conspiracy); United States v. Holmes, 822 F.2d 802, 805-06 (8th Cir.1987) (reasoning that evidence regarding legality of incarceration was intrinsic to charged escape in part because lack of such evidence might have created a gap in the jury's understanding of [the defendant's] continued custody). The Axiom Trust evidence was relevant to show Hall intended to defraud the Kingsley Trust's investors, because the Axiom Trust evidence proved Hall was already hundreds of thousands of dollars in the hole to the Axiom Trust's investors when he was promising the Kingsley Trust's investors guaranteed principal and high rates of return. [8] The district court did not abuse its discretion in admitting the Axiom Trust evidence. Any hypothetical error in admitting evidence of the Axiom Trust would be harmless. The evidence against Hall was overwhelming: (1) Hall admitted his conduct to an FBI agent after he was indicted; (2) it is undisputed Hall spent some of his investors' funds to sustain his lavish lifestyle; and (3) there is no evidence Hall invested any of the Kingsley Trust's funds. Cf. United States v. Jongewaard, 567 F.3d 336, 343 (8th Cir.2009) (concluding any error would be harmless in light of overwhelming and undisputed evidence of the defendant's guilt), cert. denied, ___ U.S. ___, 130 S.Ct. 1502, 176 L.Ed.2d 118 (2009) (No. 09-6832); O'Dell, 204 F.3d at 834 (recognizing the strength of the government's case minimizes prejudicial effect of intrinsic evidence).