Opinion ID: 596519
Heading Depth: 2
Heading Rank: 4

Heading: Exclusion of Loss Evidence

Text: 27 Waldrip contends that the district court erred in refusing to allow her to introduce evidence that she and other investors in the Project sued the bank, and as a result of that suit, received a favorable settlement. At trial, the government introduced evidence that the banks had sustained losses as a result of Waldrip's actions. TCB claimed a $59,200 loss and FIB claimed a loss of over $80,000. Additionally, the banks claimed losses for costs incurred in clearing title to the property as a result of Waldrip's actions. 28 Loss need not be proven to convict a defendant for bank fraud or making a false statement to a bank and evidence that there was no loss is not a defense to either of those crimes. See United States v. Lemons, 941 F.2d 309, 315-16 (5th Cir.1991), United States v. Trexler, 474 F.2d 369, 372 (5th Cir.), cert. denied, 412 U.S. 929, 93 S.Ct. 2759, 37 L.Ed.2d 157 (1973). At trial, after the government introduced evidence that the banks had sustained losses, Waldrip sought to introduce evidence that she and other investors sued the banks in civil court and received a favorable settlement. The district court, however, refused to allow Waldrip to present such evidence. 29 Waldrip contends that the district court erred in excluding the evidence for three reasons. First, Waldrip contends that the evidence directly refutes the government's assertions that Waldrip was responsible for loss in this case. Waldrip contends that this evidence shows that even without her conduct, the banks would have lost the same amount on the Harrell lots. While this is not a defense to the action, Waldrip contends that it is admissible to refute the false impression created by the government that Waldrip caused a loss. Second, Waldrip contends that the evidence impugns the credibility of the bank officials, who told the jurors that Waldrip was the cause of loss to the banks. Third, Waldrip contends that it corroborates her explanation that she believed she had not done anything inappropriate. 30 The district court was correct in refusing to admit evidence of the settlement because the evidence was not relevant to the offenses charged. The trial judge has broad discretion in ruling on questions of relevancy. Hamling v. United States, 418 U.S. 87, 124-25, 94 S.Ct. 2887, 2911-12, 41 L.Ed.2d 590 (1974). Federal Rule of Evidence 401 states that relevant evidence is evidence having any tendency to make the existence of any fact that is of consequence to the determination of the action more or less probable than it would be without the evidence. Implicit in that definition are two distinct requirements: (1) the evidence must tend to prove the matter sought to be proved; and (2) the matter sought to be proved must be one that is of consequence to the determination of the action. United States v. Hall, 653 F.2d 1002, 1005 (5th Cir.1981). Moreover, the matter sought to be proved must be part of the hypothesis governing the case. In a criminal case, the governing hypothesis consists of the elements of the offense charged and the relevant defenses (if any) raised to defeat criminal liability. Id. The evidence regarding the settlement agreement reached between the bank and the investors is relevant only to the issue of loss and the amount of loss. Because loss need not be proven to convict a defendant for bank fraud or making a false statement to a bank, the district court correctly determined that the evidence was not relevant. Moreover, the settlement agreement is not relevant to Waldrip's good faith defense that she believed that she had the authority to sign the loan documents. 31 AFFIRMED.