Court Opinion

ID: 2648911
Source: CourtListenerOpinion
Date Created: 2014-01-13 14:36:24.010981+00
Date Added: 2024-06-11T12:56:47.895642
License: Public Domain

Case: 12-15348    Date Filed: 01/10/2014   Page: 1 of 12

                                                             [DO NOT PUBLISH]

               IN THE UNITED STATES COURT OF APPEALS

                        FOR THE ELEVENTH CIRCUIT

                                    No. 12-15348
                                Non-Argument Calendar

                     D.C. Docket No. 1:11-cr-20324-MGC-1

UNITED STATES OF AMERICA,
                                                                Plaintiff-Appellee,

                                      versus

MYRON BUDNICK,
                                                             Defendant-Appellant.

                    Appeal from the United States District Court for
                            the Southern District of Florida

                               (January 10, 2014)

Before HULL, WILSON and FAY, Circuit Judges.

PER CURIAM:

      A jury convicted Myron Budnick for acts related to his role in a conspiracy

designed to operate sham companies to elicit credit and receive goods from

vendors knowing that he and his co-conspirators would abandon the sham
              Case: 12-15348    Date Filed: 01/10/2014   Page: 2 of 12

companies before those companies paid for the delivered goods. This scheme is

referred to as a “bust-out.”

      Budnick appeals his convictions and sentences for one count of conspiracy

to commit wire fraud, in violation of 18 U.S.C. § 1349, and four counts of

substantive wire fraud, in violation of 18 U.S.C. §§ 2 and 1343. On appeal,

Budnick argues that the district court erred by: (1) declining to remove an

impaneled juror; (2) declining to give a requested jury instruction; and

(3) increasing Budnick’s sentencing offense level based on his leadership role in

the criminal offense.

      After review of the entire record on appeal and upon consideration of the

parties’ briefs, we affirm.

                                 I. DISCUSSION

A.    Retaining an Impaneled Juror
      Budnick argues that the district court abused its discretion by declining to

remove an impaneled juror who had a strong reaction to certain testimony.

      Budnick and his co-conspirators defrauded companies of goods under the

false pretense that their sham companies would pay for such goods. One victim of

the conspirators’ scheme was Mil-Spec Packaging of Georgia (“Mil-Spec”), a

vendor that manufactured and distributed packaging materials that were certified to

                                          2
              Case: 12-15348     Date Filed: 01/10/2014    Page: 3 of 12

government specifications. Mil-Spec sold its goods to the federal government,

government contractors, and private commercial companies.

      During a lunch recess, one juror, a military veteran, told a courtroom deputy

that he had concerns about the acts committed against Mil-Spec. Before resuming

trial, the district court questioned the juror in the presence of Budnick, his counsel,

and the prosecutor. At the court’s request, the juror described his concern. As a

military veteran, the juror expressed concern that fraud, such as the fraud against

Mil-Spec, either (1) raises the price of the goods sold to the military or (2) reduces

the quality of goods sold to the military.

      After conferring with defense counsel and the prosecutor, the district court

had this colloquy with the juror:

             THE COURT: Sir, you reported to us that you had a
             very strong reaction when you heard [the] testimony
             [concerning the fraud perpetrated on Mil-Spec].

             A JUROR: Yes, I did.

             THE COURT: Now, you understand that in this case,
             neither side has disputed that a fraud occurred based
             upon what you’ve heard? Do you understand that?

             A JUROR: Yes, ma’am.

             THE COURT: And the only question is whether or not
             Mr. Budnick participated in the fraud.   Do you
             understand that?

             A JUROR: Yes, ma’am.
                                             3
              Case: 12-15348     Date Filed: 01/10/2014    Page: 4 of 12

             THE COURT: Based upon your feelings do you believe
             that you would be able to his [sic] listen to all the
             evidence and render a decision based only on the
             evidence in this case and not on any of the feelings that
             you have just discussed with us in open court?

             A JUROR: Is the evidence that were [sic] presented
             before for Mil-Spec not considered part of the trial?

             THE COURT: Oh, it’s part of this trial, but you still
             have to determine whether or not this defendant was the
             individual who committed the fraud. You still have to
             make that determination as a juror.

             A JUROR: Okay. I can keep an open mind to the rest of
             the evidence that is going to be shown to us, but it is
             going to be in the back of my mind, the whole Mil-Spec
             situation.

      The district court told the juror that it would hold the juror to his word that

he “will make every effort to be impartial in this case and listen to the evidence.”

      The district court instructed the juror that he must “not have any discussion

with the other members of the jury about what we have discussed here in open

court.” The district court also instructed, “If for some reason you feel the need to

have this discussion again, please bring it to [the courtroom deputy’s] attention.”

                                          4
                Case: 12-15348        Date Filed: 01/10/2014        Page: 5 of 12

       Here, we cannot say that the district court abused its considerable discretion

by declining to remove the impaneled juror. 1 After conducting a thorough inquiry

into the juror’s concern and potential bias, the district court determined that the

juror would be able to listen to the evidence and render a decision as to whether

Budnick individually participated in the fraud based on that evidence. In fact, with

respect to whether Budnick participated in the fraud, the juror told the court that he

would keep an “open mind to the rest of the evidence.” The district court also did

not abuse its discretion in relying on this statement from the juror.

       Moreover, the district court instructed the juror to bring any further related

concerns to the courtroom deputy’s attention. The juror never expressed additional

concerns or thoughts of bias.

       Having found no impairment to the juror’s impartiality, the district court

acted within its sound discretion in denying Budnick’s request to remove the

impaneled juror.

       1
          We review a district court’s decision to remove a juror for an abuse of discretion.
United States v. Augustin, 661 F.3d 1105, 1129 (11th Cir. 2011). Just cause exists to discharge a
juror if, inter alia, the court finds evidence that the juror cannot decide the issues fairly. United
States v. Register, 182 F.3d 820, 840 (11th Cir. 1999). The district court’s discretion will not be
disturbed absent a showing of bias or prejudice to the defendant. United States v. Fajardo, 787
F.2d 1523, 1525 (11th Cir. 1986).

                                                 5
              Case: 12-15348     Date Filed: 01/10/2014   Page: 6 of 12

B.    Jury Charge
      Budnick argues that the district court abused its discretion by declining to

give a requested jury instruction.

      The indictment alleges that Budnick and four others (1) conspired to commit

wire fraud and (2) committed wire fraud. The indictment alleges that the

conspiracy occurred “[f]rom on or about May 19, 2008, through on or about

August 28, 2010.” Specifically, the indictment alleges that Budnick and his co-

conspirators performed bust-outs on four sham companies. The indictment also

alleges four substantive counts of wire fraud that occurred between September

2008 and November 2009.

      In mid-July 2010, one of Budnick’s co-conspirators, Ernesto Robau, met

with the government agent investigating the conspiracy. Ultimately, Robau agreed

to cooperate with the government investigation.

      Specifically, in August 2010, Robau cooperated with the government, and,

with Robau’s knowledge and assistance, the government recorded a particularly

adverse conversation between Budnick and Robau at the “Ale House.” At trial,

Robau testified about the entire criminal scheme, including the acts discussed in

his “Ale House” conversation with Budnick. During Robau’s testimony, the

government published the “Ale House” recording and a subsequent telephone

                                          6
                Case: 12-15348         Date Filed: 01/10/2014        Page: 7 of 12

conversation between Robau and Budnick. The government also submitted into

evidence several emails between Robau and Budnick.

       After Robau became an informant, Budnick could not be a co-conspirator

with Robau. See United States v. Lively, 803 F.2d 1124, 1126 (11th Cir. 1986)

(“[A] person cannot conspire with a government informer who secretly intends to

frustrate the conspiracy.”). As a result, Budnick requested the following jury

instruction:

               Members of the jury, you are hereby instructed that after
               July 28, 201[0], and prior to the meeting at the Ale
               House, Ernesto Robau became the Government’s agent
               and informer and thereafter could not be a co-conspirator
               with Myron Budnick because one who acts as a
               government agent and enters into a purported conspiracy
               in the secret role of an informer cannot be a co-
               conspirator.

       The district court did not abuse its discretion by declining to give this jury

instruction.2 The indictment alleged four substantive counts of wire fraud that

occurred between September 2008 and November 2009—all well before the time

       2
         We review a district court’s refusal to give a requested jury instruction for an abuse of
discretion. United States v. Palma, 511 F.3d 1311, 1314-15 (11th Cir. 2008). “We will find
reversible error only if (1) the requested instruction correctly stated the law; (2) the actual charge
to the jury did not substantially cover the proposed instruction; and (3) the failure to give the
instruction substantially impaired the defendant’s ability to present an effective defense.” Id. at
1315 (internal quotation marks omitted). A “defendant is entitled to have presented instructions
relating to a theory of defense for which there is any foundation in the evidence, even though the
evidence may be weak, insufficient, inconsistent, or of doubtful credibility.” Lively, 803 F.2d at
1126 (internal quotation marks omitted).

                                                  7
              Case: 12-15348    Date Filed: 01/10/2014    Page: 8 of 12

that Robau first worked with the government to record the August 2010 Ale House

conversation. The jurors had a copy of the indictment during their deliberations.

Furthermore, the evidence at trial showed that Budnick and his co-conspirators

completed the bust-out of the four sham companies described in the indictment

before Robau acted as a government informant in August 2010. Specifically, the

sham companies were opened in 2008 and 2009. And, the conspirators busted-out

and abandoned the sham companies by January 2010. Thus, given the record as a

whole, we cannot say that the district court abused its discretion by declining to

give the requested instruction because Robau became a government informant

months after the bust-out of the sham companies listed in the indictment ended.

      Budnick’s reliance on this Court’s decision in United States v. Lively, 803

F.2d 1124, is misplaced. In Lively—under facts markedly different from the facts

here—we held that it was reversible error not to give a jury instruction similar to

the one Budnick requested.

      In Lively, the indictment charged that the conspiracy occurred from

March 1985 until May 1985. 803 F.2d at 1126. The co-conspirator in Lively

became a government informant in March 1985, which was early in the alleged

conspiracy period. Id. at 1126. Part of the Lively defendant’s defense was that he

was unaware of the illegal aim of the conspiracy until April 1985, which was after

                                          8
              Case: 12-15348     Date Filed: 01/10/2014    Page: 9 of 12

his fellow co-conspirator became a government informant. Id. at 1127-28. Given

the nature of the defense’s theory, the Lively court held that the district court

committed reversible error in failing to address a “vital aspect of the defense’s

theory of the case . . . that was not substantially covered by other instructions.” Id.

at 1128.

      Budnick made no such similar claim here—that is, Budnick did not argue at

trial that he became aware of the criminal scheme only after Robau became a

government informant. And, Budnick failed to direct this Court or the district

court to any evidence supporting that type of defense theory. Thus, unlike the

instruction in Lively, the requested jury instruction was not “vital” to Budnick’s

defense. Consequently, the district court’s failure to give the requested instruction

did not substantially impair Budnick’s ability to prepare or present an effective

defense.

      For these reasons, the district court acted within its sound discretion in

denying Budnick’s requested jury instruction.

C.    Sentencing Guidelines
      Budnick argues that the district court erred by increasing his offense level

four levels for Budnick’s leadership role in the criminal offense.

                                           9
             Case: 12-15348     Date Filed: 01/10/2014    Page: 10 of 12

      A defendant’s offense level is increased four levels “[i]f the defendant was

an organizer or leader of a criminal activity that involved five or more participants

or was otherwise extensive.” U.S.S.G. § 3B1.1(a). To qualify for the increase, the

defendant must have acted as an organizer or leader “of one or more other

participants.” Id. § 3B1.1, cmt. n.2. However, to be considered an organizer or

leader, a defendant need not have been the sole leader or kingpin of the conspiracy.

United States v. Ramirez, 426 F.3d 1344, 1355 (11th Cir. 2005).

       “In distinguishing a leadership and organizational role from one of mere

management or supervision,” the district court considers the following factors:

             [T]he exercise of decision making authority, the nature of
             participation in the commission of the offense, the
             recruitment of accomplices, the claimed right to a larger
             share of the fruits of the crime, the degree of participation
             in planning or organizing the offense, the nature and
             scope of the illegal activity, and the degree of control and
             authority exercised over others.

U.S.S.G. § 3B1.1, cmt. 4. The government must prove the existence of a

leadership role by a preponderance of the evidence. United States v. Alred, 144

F.3d 1405, 1421 (11th Cir. 1998).

                                          10
                  Case: 12-15348        Date Filed: 01/10/2014        Page: 11 of 12

       The district court did not clearly err by increasing Budnick’s offense level

four levels pursuant to U.S.S.G. § 3B1.1(a). 3 The trial evidence supported the

district court’s finding that Budnick exerted a leadership or organizational role

over one or more participants.4 For example, the evidence showed that Budnick

took on a leadership role in the conspiracy by: (1) preparing annual reports and

reinstatements for the sham companies; (2) deciding to use fraudulent credit or

trade references for companies without existing references; (3) sending letters to

creditors representing himself as the attorney of several fraudulent corporations;

(4) reinstating inactive corporations and changing the owners, officers, and

directors of those corporations; (5) recruiting an employee, Franklin Wellman, into

the conspiracy; (6) taking merchandise obtained by the conspiracy without

apparent payment; and (7) finding new companies on which to perform bust-outs.

The evidence also shows that Budnick acted as an organizer or leader of another

participant by recruiting an employee into the scheme and supervising the

employee in establishing a sham company.

       3
        We review for clear error a district court’s factual finding that a defendant was an
organizer or leader to support an increase in the offense level pursuant to § 3B1.1(a). Ramirez,
426 F.3d at 1355.
       4
           There is no dispute that the conspiracy involved at least five participants.

                                                   11
                 Case: 12-15348   Date Filed: 01/10/2014   Page: 12 of 12

      The district court expressly referenced some of this evidence before

overruling Budnick’s objection to the offense-level increase at the sentencing

hearing. Specifically, in response to Budnick’s argument that the leadership-based

increase was unwarranted, the district court asked rhetorically:

                 Who was the person who . . . sent the letters to the
                 creditors when people started wanting their money back?
                 Who was the individual who represented himself as the
                 lawyer of some of these companies, when people tried to
                 get their money back? Who was the person that got
                 Mr. Wellman involved in this scheme?

       In asking these questions, the district court made clear that it was well aware

of the actions evincing Budnick’s leadership role in the conspiracy. Moreover, the

district court said, “I was present at trial. I heard the evidence. I believe that this

enhancement is entirely appropriate, given the evidence that was produced at trial

in this case.”

       Such comments show that the district court considered the evidence at trial

and found that a preponderance of the evidence supported the offense-level

increase for Budnick’s leadership role in the offense. Thus, the district court did

not clearly err in overruling Budnick’s objection to increasing his offense level

based on his leadership role in the offense.

                                  II. CONCLUSION

       Budnick’s convictions and sentences are AFFIRMED.

                                           12