Opinion ID: 78444
Heading Depth: 2
Heading Rank: 2

Heading: sufficiency of the evidence

Text: Whether there is sufficient evidence in the record to support a jury's verdict in a criminal trial is reviewed de novo, taking the evidence in the light most favorable to the Government. United States v. Futrell, 209 F.3d 1286, 1288 (11th Cir.2000). Accordingly, we are obliged to resolve any conflicts in favor of the Government, draw all reasonable inferences that tend to support the prosecution's case, and assume that the jury made all credibility choices in support of the verdict. United States v. Thompson, 473 F.3d 1137, 1142 (11th Cir.2006); United States v. Ward, 197 F.3d 1076, 1079 (11th Cir.1999). Evidence is sufficient to support a conviction if a reasonable trier of fact could find that the evidence established guilt beyond a reasonable doubt. United States v. Calhoon, 97 F.3d 518, 523 (11th Cir.1996). In rebutting the Government's evidence, [i]t is not enough for a defendant to put forth a reasonable hypothesis of innocence, because the issue is not whether a jury reasonably could have acquitted but whether it reasonably could not have found guilt beyond a reasonable doubt. Thompson, 473 F.3d at 1142. Measured against this standard, we hold that there was sufficient evidence to show that Maxwell actively participated in the scheme to defraud and had the requisite criminal intent. Maxwell was convicted of twenty-three counts of substantive and conspiratorial criminal conduct primarily based on mail and wire fraud. The elements of mail and wire fraud are: (1) intentional participation in a scheme to defraud, and, (2) the use of the interstate mails or wires in furtherance of that scheme. See United States v. Hasson, 333 F.3d 1264, 1270 and n. 7 (11th Cir.2003); United States v. Ellington, 348 F.3d 984, 990 (11th Cir.2003). To sustain the related conspiracy convictions the Government was required to prove that Maxwell knew of and willfully joined in the unlawful scheme to defraud; circumstantial evidence can supply proof of knowledge of the scheme. Ellington, 348 F.3d at 989-90. A scheme to defraud requires proof of a material misrepresentation, or the omission or concealment of a material fact calculated to deceive another out of money or property. United States v. Svete, 556 F.3d 1157, 1161, 1169 (11th Cir. 2009) (en banc). Hasson, 333 F.3d at 1270-71 (internal citations omitted). A misrepresentation is material if it has a natural tendency to influence, or [is] capable of influencing, the decision maker to whom it is addressed. Hasson, 333 F.3d at 1271. The evidence, taken in a light most favorable to the Government, reveals that Fisk employees, with Maxwell's knowledge and approval, submitted bids and MURs to the County and to the United States that materially and repeatedly misrepresented that FLP performed a commercially useful function on each of the six MIA contracts when in truth it did not. Maxwell made the following material misrepresentations and undertook the following conduct in support of the misrepresentations. He directed that Fisk prepare, negotiate, and review bids containing explicit representations that FLP was going to perform the required CSBE and DBE percentage of the work, despite knowing those representations were false. Indeed, Fisk prepared bids on behalf of FLP without consulting or discussing the bid with FLP, and without regard for whether FLP was able or willing to undertake the work. Maxwell and FLP entered into an agreement whereby Fisk would pay FLP only three percent or five percent of the value of the CSBE or DBE portion of the contract and would retain the rest of the payments as compensation for actually completing the work required by the contract. When Paultre complained that FLP was not making any money on these contracts, it was Maxwell who ordered his project manager to tell that son of a bitch that he was getting his [five] percent and just do what he was told. The evidence established that FLP did not perform a commercially useful function on any of the six MIA contracts. Notably, Fisk, not FLP, performed and supervised all of the CSBE and DBE work. But, to give the appearance of FLP involvement, Maxwell directed Paultre occasionally to attend weekly progress meetings; Maxwell transferred Fisk employees to FLP's payroll even though those employees continued to be supervised by Fisk's supervisors, earned the same pay, and performed the same tasks while using Fisk equipment; Maxwell reimbursed FLP for all of the labor costs incurred by Fisk employees who were put on FLP's payroll; Maxwell caused an FLP trailer to be placed on certain job sites; and Maxwell used two-party checks with FLP's name to purchase materials for which Fisk negotiated, ordered and paid. Neither Malone nor Paultre, the two heads of FLP, supervised any workers or ordered or paid for any materials on the six MIA contracts. Maxwell's conduct on Contract 737A is particularly striking. While FLP received the CSBE electrical subcontract on that project, Fisk was not awarded any part of the contract. But, Fisk performed all of the CSBE required work for FLP anyway. It obtained the permits, purchased the materials, supplied the labor, and provided the supervision. Maxwell directed Clyne to open a Fisk job number for the contract and Paultre signed over to Fisk the entire $90,000 payment that FLP had received under the CSBE subcontract. And, when County auditors subsequently asked Paultre to explain why FLP turned over the entire payment to Fisk, Maxwell's co-conspirators, with his knowledge and approval, prepared and submitted falsified back-dated letters between Fisk and FLP in order to give the appearance that FLP was simply repaying a loan to Fisk. As for Contracts B313A and B315A, Fisk and FLP were awarded separate bids, requiring them to complete separate tasks. However, Fisk performed the work for both companies, despite Maxwell's knowledge that this would cause Fisk to lose money. A Fisk project manager prepared all of the correspondence between FLP and the primary contractor, as well as FLP's daily progress reports, and FLP's pay applications. Indeed, he testified that this was the first and only time in his twenty-nine year career that he had been asked to do this. Because FLP was paid separately by the primary contractor in installments for these two contracts, Maxwell asked Clyne on a daily basis how they were going to recover the money from FLP, and, at one point, directed Clyne to ask the primary contractor not to make any additional payments to FLP until Maxwell could begin recovering the money. In order to deceive County auditors, Fisk altered its invoices to give the appearance that they were billed to FLP and then had FLP use the proceeds of Contracts B313A and B315A to pay Fisk's bills. Maxwell also directed that the MURs be filled out falsely, representing that FLP was performing a commercially useful function on all six MIA contracts when, in fact, Fisk, and not FLP, was managing, supervising, and performing the necessary work. As for Contracts 737G and 730F, a Fisk project manager alerted Maxwell that he was concerned with the fact that [he] was filling out [MURs] for our minority participation, but we did not have minority participation on the project at the time. Maxwell simply told him that it would be taken care of and not to worry about it. Based on this body of evidence, we think a reasonable jury could find beyond a reasonable doubt that FLP did not perform a commercially useful function on the six MIA contracts, and that Maxwell knew FLP would not perform a commercially useful function. These misrepresentations were material. Without them FLP would not have been awarded the six MIA contracts and would not have been allowed to continue to participate in them. Maxwell counters that the Government did not present sufficient evidence of a scheme to defraud, because he presented three witnesses who testified that many of the actions undertaken by Fisk and FLP were consistent with local industry standards. These witnesses claimed, among other things, that the shifting of employees between a CSBE or DBE certified subcontractor and its primary contractor, supplying of supervisors by the primary contractor for the CSBE or DBE subcontractor, purchasing of materials for the CSBE or DBE contractor by the primary contractor, funding of the CSBE or DBE payroll by the primary contractor, and use of two-party checks to purchase materials for CSBE and DBE subcontractors were consistent with local industry practices. The problem with the argument is that the jury was free to disregard the testimony (as it obviously did) and, instead, to credit the contrary evidence presented by the Government's witnesses, including the two it called on rebuttal. Ellington, 348 F.3d at 990-91; United States v. Calderon, 127 F.3d 1314, 1325 (11th Cir.1997) (stating that credibility determinations are the sole province of the jury). The Government also presented sufficient evidence to establish that Maxwell possessed the requisite intent to defraud. An intent to defraud may be found when the defendant believed that he could deceive the person to whom he made the material misrepresentation out of money or property of some value. United States v. Cooper, 132 F.3d 1400, 1405 (11th Cir.1998); United States v. Pendergraft, 297 F.3d 1198, 1209 (11th Cir.2002) (explaining that an intent to defraud is not present if the defendant knew that he could not deceive the recipient of his statements). A jury may infer an intent to defraud from the defendant's conduct. See United States v. Hawkins, 905 F.2d 1489, 1496 (11th Cir.1990) (explaining that the Government need not produce direct proof of scienter in a fraud case, but, instead, can rely on circumstantial evidence of criminal intent); Ellington, 348 F.3d at 990 (explaining that specific intent to commit mail fraud can be inferred by a jury from the defendant's conduct). As we have detailed already, the Government presented ample evidence that Maxwell knowingly made material misrepresentations. Maxwell says, however, that the evidence is insufficient, because his witnesses claimed that some of his conduct was consistent with local industry practices. Again, while Maxwell was free to argue that these local practices were consistent with a lack of fraudulent intent, the jury was equally free to reject this testimony. Maxwell also argues that he did not have an intent to defraud, because he was confused about the meaning of the CSBE and DBE regulations. This argument is unconvincing as well. First, and most importantly, the specific intent required under the mail and wire fraud statutes is the intent to defraud, not the intent to violate a particular statute or regulation. United States v. Paradies, 98 F.3d 1266, 1285 (11th Cir.1996). What is most relevant is that Maxwell knew that the bids and MURs were submitted to the government falsely claiming that FLP would actually perform and was performing a certain percentage of the contracted work. While Maxwell is correct that when the truth or falsity of a statement centers on an interpretive question of law, the government bears the burden of proving beyond a reasonable doubt that the defendant's statement is not true under a reasonable interpretation of the law, United States v. Whiteside, 285 F.3d 1345, 1351 (11th Cir.2002), that maxim is of little help here. In this case, the jury could readily find beyond a reasonable doubt that the statements that FLP would and did perform the CSBE or DBE portion of the six MIA contracts were false even under the plain language of the pertinent regulations. Both the County and federal regulations explicitly say that a CSBE or DBE is required to perform a commercially useful function. Both regulatory schemes define a commercially useful function as being responsible for the execution of the contract and actually performing, managing, and supervising the work involved. And the DBE regulations make clear that a DBE does not perform a commercially useful function if its role is limited to that of an extra participant in a transaction, contract, or project through which funds are passed in order to obtain the appearance of DBE participation. 49 C.F.R. § 26.55(c)(2). There is no obvious ambiguity about whether a CSBE or DBE subcontractor performs a commercially useful function when the job is managed by the primary contractor, the work is performed by the employees of the primary contractor, the primary contractor does all of the negotiations, evaluations, and payments for the necessary materials, and the subcontractor does nothing more than provide a minimal amount of labor and serve as a signatory on two-party checks. In short, no matter how these regulations are read, the jury could conclude that what FLP did was not the performance of a commercially useful function. Moreover, Maxwell's conduct on Contract 737A undermines his confusion argument. That bid was awarded only to FLP. Fisk was not given any work under that contract. However, Fisk completed all of the work assigned to FLP, and FLP, in turn, signed over to Fisk its entire payment for the job. Maxwell cannot claim confusion or uncertainty about the regulations when he involved his company in the performance of a contract that was awarded only to FLP. Finally, Maxwell claims that he did not deprive the County or the United States of money or property, because, in the end, the County and the United States received the electrical work they sought. However, financial loss is not at the core of these mail and wire frauds. Instead, the penal statutes also seek to punish the intent to obtain money or property from a victim by means of fraud and deceit. Regardless of the quality or cost of the work completed by FLP and Fisk, the money used to pay FLP under those contracts was set aside by the County and the national sovereign to pay only CSBE and DBE electrical subcontractors that were actually performing commercially useful functions. Fisk is not a CSBE or DBE certified company and FLP did not perform a commercially useful function. But, through Maxwell's scheme, FLP obtained construction contracts and substantial payments from the County and the United States for which it was not eligible. By orchestrating an elaborate scheme passing on the CSBE and DBE payments to Fisk, Maxwell defrauded both sovereigns. The County and the United States were free to prescribe the rules of this contracting process, and the defendant was not free to dishonestly circumvent the worthy purpose of the set-aside programs.