Opinion ID: 371169
Heading Depth: 4
Heading Rank: 3

Heading: Appellant Harrison.

Text: 47 Harrison contends that the trial court improperly denied his Rule 29 motion for judgment of acquittal at the close of the government's case. On review of the denial of that motion, we view the evidence and all reasonable inferences therefrom in the light most favorable to the government. Glasser v. United States, supra. Applying that standard, we find the court's denial of the motion was proper. 48 Harrison concedes that there was a fraudulent scheme, but claims there was insufficient evidence of either his knowledge of, or his participation in the scheme. He relies on United States v. McDonald, 576 F.2d 1350 (9th Cir. 1978). Appellant Harrison, unlike McDonald, had specific knowledge of the fraudulent way the business was being conducted. 49 Harrison founded DMI after leaving another company engaged in the same sort of fraudulent business. He participated in some of the meetings when deceptive advertising brochures were discussed and approved, including the meeting at which the photo of the Union Bank Building was discussed. Charles Attal, who handled DMI's advertising, testified that everyone at that meeting was enthusiastic about making the building look like DMI's headquarters. The decision to eliminate the name of the building was unanimously approved. 50 Harrison attended subsequent meetings when other portions of the first brochure were discussed and approved. It is apparent that Harrison knew misleading and fraudulent representations were being made. He expressed no disapproval and took no action to prevent the dissemination of these misrepresentations. Although he may have had no formal control of the advertisements, as a corporate officer he had the authority to question them. 51 Occasionally, Harrison participated in the preparation of portfolios. In December 1972 he admitted to a DMI employee that the portfolio service had gone downhill and that he was ashamed of the portfolios. He said that he felt the client was not getting what he paid for and that few, if any, products were ever placed. Harrison was in a position to make such observations because he handled inventor complaints and negotiated settlements of them. 52 Harrison was aware of what was happening. His (i)ntent to defraud may be inferred from (his) knowledge that the scheme operated in a deceitful manner. United States v. Piepgrass, 425 F.2d 194, 199 (9th Cir. 1970); Accord, Phillips v. United States, 356 F.2d 297 (9th Cir. 1966). 53 Harrison's guilt is further demonstrated by his participation in some of the company's other deceptions. He signed the check for Fortado's advance royalty. He discussed the deceptive NAA suit against DMI in a letter to attorney Robert Croissant who represented a dissatisfied DMI client, indicating that the companies were separate and that officers of DMI had made misrepresentations to officers of NAA. 54 He acknowledged by letters to inventors their payments of the $1,500 or $1,800 fee. In a Newsletter to Inventors, he said that the company's division in charge of placement had achieved the distinction of being one of the most successful product placement firms in the world today. He knew this was false but contends this was an insignificant statement made at the end of the letter. We cannot agree. 55 From the evidence presented by the government, we find the court's denial of Harrison's Rule 29 motion for acquittal was proper. The proof demonstrated his knowing involvement in the fraudulent scheme. Lustiger v. United States, supra. 56 Harrison offered no evidence in his own behalf and he concedes that if the evidence at the close of the government's case was sufficient to sustain his conviction, it would suffice to sustain his conviction following the introduction of evidence on behalf of the other defendants and the government's rebuttal. The evidence at the close of the government's case was sufficient and we affirm his conviction.