Opinion ID: 747628
Heading Depth: 3
Heading Rank: 1

Heading: Interstate Transportation of Property Obtained by Theft or Fraud

Text: 13 (Counts Nine to Ninety, and Ninety-Three to 106) 14 Defendant was charged and convicted of ninety-six separate violations of 18 U.S.C. § 2314. 3 Each count represented a separate unauthorized check that defendant caused to be issued from a Phar-Mor account. The eighty-two checks that form the basis for counts nine through ninety represent approximately $8.8 million in unauthorized payments that defendant caused to be made from Phar-Mor to the WBL. Counts ninety-three through 106 represent fourteen Phar-mor checks, totaling approximately $568,000, written to defendant or for his direct benefit. Defendant argues that the evidence at trial was insufficient to establish that the property involved in these counts was stolen or taken by fraud and that he knew this to be so. 15 We review allegations of insufficient evidence to determine whether after viewing the evidence in the light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt. United States v. Elder, 90 F.3d 1110, 1120 (6th Cir.1996) (citing Jackson v. Virginia, 443 U.S. 307, 319, 99 S.Ct. 2781, 2789, 61 L.Ed.2d 560 (1979)). We also resolve all conflicts in testimony and draw every reasonable inference in the government's favor. United States v. Bashaw, 982 F.2d 168, 171 (6th Cir.1992). The government may meet its burden through circumstantial evidence alone, and such evidence need not exclude every possible hypothesis except that of guilt. United States v. Jackson, 55 F.3d 1219, 1225 (6th Cir.1995). 16 To prove a violation of 18 U.S.C. § 2314, the government must prove the following essential elements: 17 (1) transporting, or causing the transportation, (2) in interstate commerce, (3) of property valued at $5,000 or more, (4) with knowledge that is has been stolen, converted, or fraudulently taken from its rightful owner. 18 United States v. Weiner, 755 F.Supp. 748, 752 (E.D.Mich.1991), aff'd, 988 F.2d 629 (6th Cir.), cert. denied, 510 U.S. 848, 114 S.Ct. 142, 126 L.Ed.2d 105 (1993). 19 Defendant argues that for each count under § 2314 the government failed to put forth sufficient evidence regarding the fourth element, whether that particular check represented money that was stolen, converted, or fraudulently taken, and whether defendant had knowledge of this. With respect to counts nine through ninety, defendant argues that the government failed to show in sufficient detail that at the specific time Phar-Mor issued each of the eighty-two checks to the WBL, it was not covered by funds that Phar-Mor had received or were receivable from corporate sponsors on behalf of the WBL. With respect to counts ninety-three to 106, defendant argues that the government failed to prove that each check was not a proper payment or advance, or that it was not due and owing at the time of payment. We find these arguments to be without merit. 20 It is uncontested that defendant had invested heavily in the WBL since its founding in 1988, owned a team, the Youngstown Pride, and was the majority owner of the league itself. Finn testified that he assisted defendant in securing over $3.5 million in personal lines of credit and other financing, which defendant used to fund the Youngstown Pride and other WBL teams. Despite defendant's financial support, the league kept losing money. Defendant turned to Phar-Mor for financial help. 21 Finn testified at trial that Phar-Mor was authorized to spend $65,000 a year to sponsor the Youngstown Pride by advertising at its games and in its programs. Charity Imbrie, Senior Vice President, General Counsel, and Corporate Secretary of Giant Eagle, and Farrell Rubenstein, a member of Phar-Mor's Board of Directors and Chairman of its Audit Committee, testified that Phar-Mor was authorized to spend only $50,000 in sponsorship of the Youngstown Pride. Despite these limits to his authority, defendant directed large sums of money from Phar-Mor to the WBL. From October 1989 through February 1992, defendant directed Finn to write eighty-two Phar-Mor checks, totaling approximately $8.8 million, to the WBL. 22 Finn, Walley, Anderson, and Cherelstein all testified at trial to the elaborate means that they developed with defendant to conceal these payments from Shapira, the Boards of Directors of Giant Eagle and Phar-Mor, and others. Finn and Walley both testified that the checks were typewritten, instead being processed by Phar-Mor's computer system, in order to avoid detection and prevent leaving a trail for auditors. Anderson testified that the payments were tracked in a dead account in the subledger titled KBL receivable. These payments were further concealed when the entire subledger was effectively erased by adding hundreds of thousands of dollars to individual stores' inventory accounts. Stan Cherelstein, Phar-Mor's Controller, testified that defendant told him that he would repay the almost nine million dollars that Phar-Mor had paid to the WBL with funds from the financing of a proposed plan to purchase the Denver Nuggets of the National Basketball Association. Charity Imbrie testified, however, that when defendant should have disclosed all payments that Phar-Mor made to the WBL, he only disclosed an annual $50,000 advertising expenditure by Phar-Mor to the Youngstown Pride. Rubenstein testified the had also questioned defendant about related-party transactions, specifically about Phar-Mor's relationship with the WBL. Rubenstein testified that defendant denied that Phar-Mor buyers were soliciting WBL sponsorships from Phar-Mor vendors and did not disclose any payments other than the authorized $50,000 advertising expenditures. 23 Counts ninety-three through 106 relate to fourteen Phar-Mor checks, amounting to approximately $568,000, paid directly to defendant or for his personal benefit. Finn testified at trial that these checks, which paid for such items as an addition to defendant's personal residence and a diamond engagement ring, were hand written and hidden in various accounts just as the WBL payments had been. Finn also testified that each payment was in addition to the authorized compensation that defendant received, that none of these payments was authorized, and that none was reported on his earnings statements. One of the checks was recorded as an advance on a sale of Phar-Mor stock by defendant. Trial testimony showed that when the sale was completed, Finn asked defendant for the money, but defendant refused to repay the advance. 24 Viewing this evidence in the light most favorable to the government, we hold that it was sufficient to allow any rational juror to find the essential elements of counts nine through ninety and ninety-three through 106 beyond a reasonable doubt.