Court Opinion

ID: 147274
Source: CourtListenerOpinion
Date Created: 2010-05-27 00:01:51+00
Date Added: 2024-06-11T15:04:32.858497
License: Public Domain

FILED
                           NOT FOR PUBLICATION                              MAY 26 2010

                                                                       MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                       U .S. C O U R T OF APPE ALS

                            FOR THE NINTH CIRCUIT

UNITED STATES OF AMERICA,                        No. 09-30128

              Plaintiff - Appellee,              D.C. No. 2:07-CR-00087-WFN-2

  v.
                                                 MEMORANDUM *
MANFRED OTTO SIMON,

              Defendant - Appellant.

UNITED STATES OF AMERICA,                        No. 09-30132

              Plaintiff - Appellee,              D.C. No. 2:07-CR-00087-WFN-1

  v.

FREDERICK MANFRED SIMON,

              Defendant - Appellant.

                   Appeal from the United States District Court
                      for the Eastern District of Washington
            William Fremming Nielsen, Senior District Judge, Presiding

                        Argued and Submitted May 3, 2010
                               Seattle, Washington

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
Before: HALL, WARDLAW and GOULD, Circuit Judges.

      Frederick Manfred Simon (“Frederick”) appeals his convictions of one count

of conspiracy to commit mail and wire fraud in violation of 18 U.S.C. § 371, eight

counts of mail fraud in violation of 18 U.S.C. § 1341, and eleven counts of wire

fraud in violation of 18 U.S.C. § 1343, arguing that the convictions were not

supported by sufficient evidence. Frederick also contends that the district court

erred in admitting evidence of uncharged conduct, and that his sentence is

substantively unreasonable. Manfred Otto Simon (“Manfred”) appeals the denial

of his motion for judgment of acquittal under Federal Rule of Criminal Procedure

29. We have jurisdiction pursuant to 28 U.S.C. § 1291, and we affirm.

1. Sufficiency of the evidence of a conspiracy

      Frederick and Manfred challenge the sufficiency of the evidence of their

conspiracy convictions, arguing that there was no evidence of an agreement to

defraud the customers and suppliers of their railway components business, Railway

Logistics International (“RLI”). The government, however, introduced sufficient

circumstantial evidence that Frederick and Manfred acted with a common goal to

defraud RLI’s customers and suppliers, from which the jury could find an

agreement. See United States v. Corona-Verbera, 509 F.3d 1105, 1117 (9th Cir.

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2007) (“[C]ircumstantial evidence that the defendants acted with a common goal is

sufficient . . . to prove agreement, and agreement may be inferred from

conduct . . . .”); United States v. Iriarte-Ortega, 113 F.3d 1022, 1024 (9th Cir.

1997). The evidence showed that Frederick repeatedly defrauded RLI’s customers

and suppliers by placing and receiving orders for railway components without

paying for the orders placed or shipping the orders received. The evidence also

showed that Manfred facilitated these transactions by arranging for RLI wire

transfers, providing false excuses to suppliers concerning outstanding payments,

signing RLI payroll checks, and acting as RLI’s vice president and chief financial

officer. In addition, the government introduced evidence of Manfred’s and

Frederick’s 1997 conspiracy convictions for a virtually identical scheme to defraud

purchasers and suppliers of railway components. Viewing this evidence in the

light most favorable to the government, a rational juror could have concluded that

Frederick and Manfred acted with the common goal of defrauding the businesses

with which RLI transacted. See Jackson v. Virginia, 443 U.S. 307, 319 (1979);

Corona-Verbera, 509 F.3d at 1117.

2. Sufficiency of the evidence of Frederick’s mail and wire fraud convictions

      The government introduced sufficient circumstantial evidence of Frederick’s

intent to defraud RLI’s customers and suppliers. See United States v. Rogers, 321

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F.3d 1226, 1230 (9th Cir. 2003) (“It is settled law that intent to defraud may be

established by circumstantial evidence.”); United States v. Sullivan, 522 F.3d 967,

974 (9th Cir. 2008) (“Intent may be inferred from misrepresentations made by the

defendants, and the scheme itself may be probative circumstantial evidence of an

intent to defraud.” (citations omitted)). The evidence showed that Frederick

routinely took customer orders, demanded immediate cash payment, and would not

ship anything once payment was received. When customers followed up,

Frederick would provide a litany of excuses, including that he shipped the goods

(but then he would refuse to provide tracking numbers or would provide incorrect

tracking numbers); and that the goods were in a warehouse ready to ship (but then

he would refuse to allow customers to inspect the parts prior to shipment or would

send customers to warehouses not belonging to RLI). Frederick also refused to

allow customers to personally pick up orders. When customers demanded delivery

or a refund, Frederick cut off all communications.

      The evidence also showed that Frederick would submit orders to suppliers

for purchase on credit. After suppliers shipped the goods, Frederick would not pay

them. When they demanded payment, Frederick would provide inconsistent stories

about why he could not pay, including the assertion that he was awaiting payment

from the U.S. government on a contract to deliver goods to Iraq. In addition, the

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government introduced Frederick’s 1997 conviction for conspiracy to commit mail

and wire fraud based on virtually identical circumstances. Therefore, it would not

have been irrational for a juror to conclude that Frederick had the specific intent to

defraud RLI’s customers and suppliers. See Jackson, 443 U.S. at 319.

3. Sufficiency of the evidence of Manfred’s mail fraud convictions

      Manfred contends his mail fraud convictions were not supported by

sufficient evidence because Frederick was the moving force behind the specific

acts of mail fraud while Manfred’s connection to each act was slight. However,

the jury was specifically instructed on the Pinkerton theory of conspiracy liability,

under which Manfred is liable as a co-conspirator for all of Frederick’s crimes that

were reasonably foreseeable and in furtherance of the conspiracy. Pinkerton v.

United States, 328 U.S. 640, 647-48 (1946). Because each of Frederick’s mail

fraud convictions involved precisely what the conspiracy charged—defrauding

sellers and purchasers of locomotive and rail components by obtaining parts from

the sellers without paying them, and accepting payments from purchasers without

delivering the ordered parts—they were all reasonably foreseeable and in

furtherance of the conspiracy. Accordingly, Manfred is liable for those crimes to

the same extent as Frederick. See United States v. Long, 301 F.3d 1095, 1103 (9th

Cir. 2002).

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4. Admissibility of uncharged conduct

      The district court correctly concluded that the evidence concerning the

uncharged acts and the evidence concerning the crime were “inextricably

intertwined,” and therefore not evidence of “other acts” inadmissible under Federal

Rule of Evidence 404(b). See United States v. Williams, 989 F.2d 1061, 1070 (9th

Cir. 1993) (“The policies underlying rule 404(b) are inapplicable when offenses

committed as part of a single criminal episode become other acts simply because

the defendant is indicted for less than all of his actions.”). Frederick contracted

with the U.S. government to deliver railway parts to Iraq, but never delivered the

requested parts. Although it was Frederick, not the U.S. government, who failed to

perform on the contract, Frederick would often misrepresent to his customers and

suppliers that the U.S. government had not paid him for parts he delivered to Iraq,

and that he could not perform on his other contracts until the U.S. government paid

him. Had this evidence not been presented, the jury might have believed

Frederick’s excuse for his nonperformance was legitimate. Therefore, the evidence

of Frederick’s dealings in Iraq were inextricably intertwined with the charged

conduct. See id.

      Frederick’s procurement of a motorcycle by false pretenses, however, was

not inextricably intertwined with the charged conduct and, therefore, should have

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been excluded under Rule 404(b). However, the admission of this evidence was

harmless error. United States v. Romero, 282 F.3d 683, 688 (9th Cir. 2002) (“If we

conclude that a Rule 404(b) violation occurred, we reverse only if the error was not

harmless.”). The government provided a significant amount of evidence of intent

to defraud, including the testimony of sixty witnesses in a trial lasting

approximately three weeks. Given the substantial evidence adduced at trial, any

error in admitting the motorcycle evidence was harmless.

5. Sentencing

      The district court did not abuse its discretion in imposing the maximum

within-Guidelines sentence of 125 months upon Frederick. United States v. Carty,

520 F.3d 984, 993 (9th Cir. 2008) (en banc). “Appellate review is to determine

whether the sentence is reasonable; only a procedurally erroneous or substantively

unreasonable sentence will be set aside.” Id. Frederick does not argue that the

district court committed procedural error; he argues only that his sentence is

substantively unreasonable. “In determining substantive reasonableness, we are to

consider the totality of the circumstances . . . .” Id. We note, however, that

Frederick received a within-Guidelines sentence, which “‘will usually be

reasonable.’” Id. at 994 (quoting Rita v. United States, 551 U.S. 338, 351 (2007)).

In imposing the maximum sentence, the district court considered the 18 U.S.C.

                                           7
§ 3553(a) factors and explained the important needs for deterrence and protection

of the public given Frederick’s prior conviction of a conspiracy involving a scheme

of identical design, his high degree of culpability, the extent of the harm to

numerous victims, and the loss of hundreds of thousands of dollars. Therefore,

considering the totality of the circumstances, the district court did not abuse its

discretion in imposing the maximum sentence. See id.

      AFFIRMED.

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