Opinion ID: 751125
Heading Depth: 3
Heading Rank: 2

Heading: hobbs's testimony

Text: 30 The government also sought to impeach DeSantis by calling Hobbs as a witness. Hobbs testified extensively to his version of the reasons for CBLP's collapse. Over objections, the court allowed the prosecutor to inquire regarding what other persons said to Hobbs for the nonhearsay purpose to show why [Hobbs] took the action he did. 31 Q. You were in the thralls of telling me about being approached-- 32 A. By Lee Puckett, who ran the building company which I owned stock in as well and so did Lee. He said that--again non-voting stock--and he said again that there is something wrong with the accounts, they weren't adding up the way they should. 33 .... 34 Q. Were you approached by someone else then very shortly thereafter? 35 A. I was. 36 Q. Would you please tell the jury about that. 37 A. I drove down to where the Campus Businesses, Limited Partnership offices were in the university area. As I got out of my car at 11th and High, I was approached by John Raccanelli and Tony Warner, our directors of operation of the business down there. 38 They said they wanted to talk to me and I said fine, let's go up to the office to talk. They said no. They wanted to discuss-- 39 MR. LUTHER: Objection to what these persons wanted to discuss. 40 THE COURT: Overruled. 41 A. They wanted to discuss whatever they had to say to me in the parking lot. At that time they proceeded to tell me DeSantis had been stealing. 42 MR. LUTHER: Objection. 43 THE COURT: Mr. Luther, I believe we had a bench conference where you had a continuing objection and the Court will note that for the record and you don't have to get up every time. 44 MR. LUTHER: Thank you. 45 THE COURT: You may proceed, Mr. Hobbs. 46 A. They proceeded to tell me at that time that DeSantis had been stealing money out of the C.B.L.P. businesses, the bars, specifically; 47 That he had been--that he would call down to the office of C.B.L.P., have the secretary or office manager write a check out of whatever companies of the bars, and then either come down himself or have his secretary come down and pick the checks up. 48 In addition to that, he was taking cash out of the door money on a more than one time a week basis. Door money being the cover charge when people came into the bars. 49 Q. How long after Lee Puckett had talked to you were you approached by Raccanelli and Warner? 50 A. A matter of a couple of days, maybe. 51 Q. Not withstanding [sic] that, when they told you this about Mr. DeSantis, at the time that they told you, did you believe them? 52 A. Well, I can't imagine--I can't imagine why they would tell me that, knowing that DeSantis and I were partners, close friends and that would have--it caused me enough concern that at that point in time I contacted a law firm and took Puckett and secured the books from the building company and the books from C.B.L.P. and handed them over to the law firm of Bricker & Eckler who, in turn, hired a CPA firm, Levin and Associates, I believe, who did an audit and the result was that-- 53 MR. LUTHER: Objection, Your Honor. The results of an audit? 54 THE COURT: Overruled. 55 A. The result was that the accountant's audit revealed that Mr. DeSantis had been misappropriating funds from C.B.L.P., as well as the building company. 56 As previously discussed, extrinsic evidence consisting of Hobbs's claim that DeSantis continued to control the bars would be inadmissible under Fed.R.Evid. 608(b) if offered solely for impeachment value. And, his testimony that others told Hobbs that DeSantis was stealing from the bars would be hearsay if offered for the truth of this statement. The government attempts to avoid these difficulties by arguing that Hobbs's testimony was not for impeachment or to prove that DeSantis was taking CBLP money, but to explain why [Hobbs] took the action he did in changing CBLP's accounts and removing its books. According to the government, this is relevant to rebut the defendant's argument that Hobbs stole CBLP money. However, we do not believe there is any significant difference between evidence introduced to impeach a witness' credibility and evidence introduced to rebut a witness' account of events when the evidence has no value as rebuttal. In other words, the evidence that the government maintains is admissible to rebut the defendant's claim that CBLP's failure was due to factors other than the alleged fraud, actually supports that claim. 57 Although the relationship between ultimate investor loss and a defendant's initial intent to defraud is weak, the difficulty of proving a defendant's specific intent requires trial courts to grant the prosecution latitude in the evidence it offers in this regard. See United States v. Copple, 24 F.3d 535, 545 (3d Cir.1994). Thus, the government was properly permitted to introduce evidence of investor loss as going to the issue of DeSantis's specific intent to defraud. Similarly, however, a defendant should be granted equal flexibility in showing that the losses were not caused by the alleged fraud. Id. at n. 16. Therefore, DeSantis's testimony regarding Hobbs's alleged sabotage was also correctly allowed in rebuttal. 58 However, when viewed in its proper light, Hobbs's subsequent counter-rebuttal testimony has no relevance whatsoever when offered to challenge DeSantis's claim that the investor losses were due to factors other than fraudulent representations at the time of sale. Hobbs's testimony supports the defendant's contention that CBLP failed for reasons other than because the interests were overvalued or diluted. Boiled down, the only rational reasons the prosecution could have offered Hobbs's testimony were for its effect as bad-character evidence or to impeach DeSantis's credibility. Neither of these would be a proper basis for admission in light of Fed.R.Evid. 404 and 608. Thus, it was an abuse of discretion to allow Hobbs's testimony in this regard.