Opinion ID: 64228
Heading Depth: 2
Heading Rank: 1

Heading: sufficiency of the evidence

Text: Arledge argues that there was insufficient evidence to sustain a conviction for conspiracy, mail fraud, or wire fraud. He argues, first, that the government did not prove that he knowingly participated in the scheme to defraud, obviating his conspiracy conviction; second, that there was insufficient evidence to prove that the mailings underlying the mail fraud counts were sent pursuant to the scheme to defraud; and third, that the wiring underlying the wire fraud count occurred after the completion of the scheme to defraud. When evaluating the sufficiency of the evidence, we must view the evidence in the light most favorable to the government, and we will sustain the conviction if a rational trier of fact could have found that each element of the charged criminal offense was proven beyond a reasonable doubt. United States v. Arnold, 416 F.3d 349, 358 (5th Cir.2005); United States v. Stephens, 779 F.2d 232, 235 (5th Cir.1985).
Arledge was convicted of one count of conspiracy. To sustain a conspiracy conviction under 18 U.S.C. § 371, the government must prove: (1) an agreement between two or more person[s] to pursue an unlawful objective; (2) the defendant's knowledge of the unlawful objective and voluntary agreement to join the conspiracy; and (3) an overt act by one or more members of the conspiracy in furtherance of the objective of the conspiracy. United States v. Freeman, 434 F.3d 369, 376 (5th Cir.2005) (internal quotation marks omitted). Arledge disputes only the second element, which the government can meet by showing actual knowledge of or deliberate indifference to the scheme to defraud. Id. at 378-79. At trial, the government presented evidence to show that Arledge had actual knowledge of the Fen Phen I fraud and that Arledge was deliberately indifferent to the Fen Phen II fraud. The primary evidence of Arledge's actual knowledge of the Fen Phen I fraud was testimony from his alleged accomplice, Green. Generally, we will not disturb (the jury's) verdict [or] weigh the credibility of witnesses. United States v. Garner, 581 F.2d 481, 485 (5th Cir.1978) (citing United States v. Vomero, 567 F.2d 1315, 1316 (5th Cir.1978)) (internal quotation marks omitted); see United States v. Cravero, 530 F.2d 666, 670 (5th Cir.1976). And while we have expressed some trepidation about relying upon accomplice testimony alone, we have found that a conviction will more easily be upheld if the district court provides the jury with an instruction about the dangers of basing its conviction solely upon uncorroborated accomplice testimony. [1] See United States v. Hinds, 662 F.2d 362, 370 (5th Cir.1981) (The policy behind the giving of an accomplice instruction is no more than a commonsense recognition that an accomplice may have a special interest in testifying, thus casting doubt upon his veracity. (internal quotation marks omitted)). A conviction, especially one accompanied by an accomplice instruction, may be sustained on the uncorroborated testimony of an accomplice so long as the testimony is not incredible or otherwise insubstantial on its face. United States v. Osum, 943 F.2d 1394, 1405 (5th Cir.1991) (citing United States v. Carrasco, 830 F.2d 41, 44 (5th Cir.1987)). Testimony will be found incredible only if it is unbelievable on its face or the witness testifies to events that she physically could not have possibly observed or events that could not have occurred under the laws of nature. Cravero, 530 F.2d at 670. Green testified that Arledge had actual knowledge of the scheme to defraud the Fen Phen I settlement. The evidence showed that when Green became concerned that she might be caught fabricating the prescriptions and expressed a desire to stop her illegal activity, she contacted Warren. Warren tried to convince Green to continue fabricating the prescriptions, but Green was not assuaged. Warren told Green that he would have Arledge contact her to help reassure her that she would not be caught. Green testified that Arledge persuaded her to continue: [Arledge] told meI may not remember the exact words, but he told me that he had talked to [Warren] and [Warren] told him I was afraid to do any more of the prescriptions because I was afraid I was going to get in trouble. And he said we wereI wasn't going to get in any trouble because like [Warren] said, they were going to box all those files up, put them away, and never be seen again. And like I say, I don't remember the whole conversation, but I remember that he convinced me to go on and do more. A rational trier of fact could conclude that this testimony was evidence of three things: (1) Arledge knew that the prescriptions Green had created were fabricated; (2) Arledge was in an agreement with Warren and Green to defraud the Settlement Fund; and (3) Arledge's conversation with Green was in furtherance of that scheme to defraud. Arledge maintains that this evidence alone was not sufficient to support the verdict because the testimony was from an alleged accomplice and the government failed to corroborate Green's testimony with phone records of this conversation or additional testimony. There is no evidence to suggest that Green's testimony was either incredible or insubstantial; Green's testimony was consistent with other evidence adduced at the trial. In fact, Warren confirmed that Green expressed her concern to him about providing more prescriptions and that he spoke with Arledge about Green's concern. Next, we examine whether there was sufficient evidence for a rational trier of fact to conclude that, at a minimum, Arledge was deliberately indifferent to the Fen Phen II fraud. To prove deliberate indifference, the government had to prove beyond a reasonable doubt that (1) the defendant was subjectively aware of a high probability of the existence of illegal conduct; and (2) the defendant purposely contrived to avoid learning of the illegal conduct. United States v. Scott, 159 F.3d 916, 922 (5th Cir.1998). [2] We conclude that the evidence showed that Arledge was deliberately indifferent to the fraud that occurred in the Fen Phen II cases. The government provided evidence that Arledge was subjectively aware of a high probability of the existence of illegal conduct. See Scott, 159 F.3d at 922. As noted above, a rational trier of fact could have concluded that Arledge had actual knowledge of the Fen Phen I schemeas evidenced by Green's testimonyand that he was aware that Warren had recruited Green. The trier of fact could also infer that Arledge's knowledge of Warren's involvement in the Fen Phen I fraud, specifically Arledge's knowledge that Warren had worked with Green to create fraudulent documents, would have put Arledge on notice to suspect any claims that derived from Warren's recruitment efforts, including Warren's solicitation of clients in the Fen Phen II cases. Thus, a rational trier of fact could have concluded that Arledge was aware that there was a high probability that the Fen Phen II claims might also be manufactured. The government also provided sufficient evidence for a rational trier of fact to conclude that Arledge purposely contrived to avoid learning of the [fraud]. See id. Despite Arledge's assertions otherwise, there is little evidence that Arledge conducted an investigation of the fraudulent claims, even after one of his employees, Christy Clay, suggested to him that the documents appeared fraudulent. Arledge never reported any fraudulent claims to the Settlement Fund and never uncovered any fraud himself. Instead, he filed these claims despite concerns about their veracity. A rational trier of fact also could have found that Arledge attempted to cover up the fraud after Gallagher notified him that AHP believed that several of the claims filed by S&A were fabricated. Arledge taped a conversation between Warren and him in which they discussed Warren's role in recruiting claimants. The transcript of that conversation suggests that Arledge prepared his questions to lead Warren to answer them in a manner that would relieve both Warren and him of liability. In every instance, Arledge asked Warren a leading question, requiring only a yes or no answer. When Warren tried to answer in a way that might implicate himself or Arledge, Arledge rephrased the answer to eliminate any liability for both of them. We therefore hold that there was sufficient evidence for a rational trier of fact to find that the government had proved beyond a reasonable doubt that Arledge was deliberately indifferent to the Fen Phen II fraud. In sum, viewing the evidence in the light most favorable to the government, there was sufficient evidence to show that Arledge had actual knowledge of the Fen Phen I fraud and was deliberately indifferent to the Fen Phen II fraud. Accordingly, we hold that there was sufficient evidence to support the conspiracy conviction.
Next, Arledge contends there was insufficient evidence that the mailings underlying counts 2-5 were directly related to the execution of the scheme to defraud. A conviction for mail fraud under 18 U.S.C. § 1341 requires proof of (1) a scheme to defraud; (2) the use of the mails to execute the scheme; and (3) the specific intent to defraud. United States v. Bieganowski, 313 F.3d 264, 275 (5th Cir.2002). The government based the mail fraud charges on four checks for attorneys' fees sent through the mail to Arledge. Each check contained fees stemming from Arledge's representation of Fen Phen claimants. The government has not identified specific instances of fraud that resulted in the attorneys' fees contained in the checks, acknowledging that each check contained fees stemming from legitimate claims. Arledge argues that the government failed to prove the second element of the mail fraud statutethe use of mails to execute the schemeand that the government's failure to provide a clear nexus between the fees received and the fraudulent claims is fatal to the government's case. In support, Arledge principally relies upon United States v. Tencer, 107 F.3d 1120 (5th Cir. 1997), in which an owner of a chiropractic clinic was convicted of multiple counts of mail fraud after filing fraudulent claims for services never rendered, id. at 1126-27. In Tencer, we specifically decline[d] to endorse a broad reading of § 1341's mailing requirement that would relieve the government of the burden of proving that mailings underlying mail fraud counts are related to the fraud being perpetrated. Id. at 1126. We held that the government's failure to produce any evidence that connected the specific checks, upon which the convictions were based, to the fraudulent claims was fatal to the government's case. Id. at 1126-27. In addition, the government, in that case, had failed to explain how the payment of legitimate claims had furthered the scheme to defraud. Id. at 1126 n. 1. Thus, we held that a rational trier of fact could not have found Tencer guilty without evidence that the checks underlying the mail fraud counts contained fraudulent proceeds. Id. at 1127. Despite this strong language, the Tencer court also noted that `innocent' mailings can sometimes support mail fraud convictions. Id. (citing Schmuck v. United States, 489 U.S. 705, 714-15, 109 S.Ct. 1443, 103 L.Ed.2d 734 (1989)). In Schmuck, the Supreme Court found that innocent mailings could supply the mailing element for mail fraud and held that [t]he relevant question at all times is whether the mailing is part of the execution of the scheme as conceived by the perpetrator at the time. Schmuck, 489 U.S. at 715, 109 S.Ct. 1443. Thus, the government need only provide sufficient evidence that the innocent or legitimate claims were incidental to an essential part of the scheme to defraud. See id. at 710-11, 109 S.Ct. 1443 (It is sufficient for the mailing to be incident to an essential part of the scheme, or a step in [the] plot. (internal quotation marks and citation omitted)). Here the government presented sufficient evidence for the jury to conclude that all claims Arledge submitted were part of the scheme to defraud, because the legitimate claims were used as a smoke screen to conceal the fraudulent ones. The evidence showed that the fraudulent claims were easily identified if laid next to one another. The district court noted that the method of falsifying the documents was a rather artless and somewhat simpleminded and easily detectable matter of falsifying prescriptions and medical records by the use of a computer and a copy machine. All you had to do was look at it and see the same form was used time and time and time and time again. By mixing the nearly identical fraudulent claims with the legitimate ones, Arledge was able to drastically lower the chances of detection. In fact, the sheer number of claims aided the fraud because the chances of success were increased by virtue of the number of claims that had to be processed. A rational trier of fact could have concluded that the fraud was possible because the legitimate claims hid the clearly fabricated prescriptions. The scheme to defraud also depended upon the maintenance of a harmonious relationship between Arledge, Gallagher, and the Settlement Fund. We have held that mailings pursuant to a scheme to defraud, which extends over a long period of time and depends upon a good relationship between the victim and the defendant, are often incidental to an essential part of the scheme, thus satisfying the mailing element of the mail fraud offense. See United States v. Mills, 199 F.3d 184, 189-90 (5th Cir.1999) (holding that a scheme involving the issuance of numerous fraudulent checks over the course of thirteen months was not a one-shot operation and that the success of the venture depended upon the continued harmonious relationship with the victims of the fraud); see also Schmuck, 489 U.S. at 711-12, 109 S.Ct. 1443 (upholding a jury verdict because a rational jury could have concluded that the success of the [defendant's] venture depended upon his continued harmonious relations with, and good reputation among, [the victims]). A rational trier of fact could have concluded that the concealment of the fraudulent claims allowed Arledge to continue to submit additional fraudulent and legitimate claims. There was testimony from Gallagher that, had he been aware that Arledge was filing false claims, he would not have allowed Arledge to continue to receive any attorneys' fees. Thus, the success of the ongoing fraudulent venture depended upon continued harmonious relations between Arledge and Gallagher. Cf. Schmuck, 489 U.S. at 711-12, 109 S.Ct. 1443; United States v. Strong, 371 F.3d 225, 230-31 (5th Cir.2004) (recognizing that mailings which lull the victims of fraud have been found to fall under 18 U.S.C. § 1341the mail fraud statute). For these reasons, a rational trier of fact could have found that Arledge used the innocent mailings to conceal the easily detectable fraud and the mailings were incidental to the scheme to defraud. The government did not have to establish that the checks contained attorneys' fees for fraudulent claims; all of the mailings were essential to the fraud. Accordingly, we hold that there was sufficient evidence to support the mail fraud convictions.
Arledge also contends that the evidence was insufficient to support a conviction on count 7. Count 7, the wire fraud count, involved the transmission of a fax, sent from Gallagher's office to a paralegal working at S&A, which contained a chart of claimants' names and settlement amounts and a request for releases. These attorney releases had to be sent before Arledge could obtain his share of the attorneys' fees. Arledge maintains that this fax was sent after the scheme to defraud had been completed because the claimants had already been paid. In United States v. Maze, 414 U.S. 395, 94 S.Ct. 645, 38 L.Ed.2d 603 (1974), the Supreme Court held that a scheme to defraud is complete when `[t]he persons intended to receive the money had received it irrevocably,' id. at 400, 94 S.Ct. 645 (quoting Kann v. United States, 323 U.S. 88, 94, 65 S.Ct. 148, 89 L.Ed. 88 (1944)). As far as Arledge was concerned, the scheme was not complete until Arledge received attorneys' fees for his participation in the scheme to defraud. Because a rational trier of fact could have found that there was sufficient evidence that the wirings were sent pursuant to the scheme to defraud, we find that the conviction as to count 7 was proper.