Court Opinion

ID: 52302
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Date Created: 2010-04-26 01:14:22+00
Date Added: 2024-06-11T17:19:15.652951
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                  IN THE UNITED STATES COURT OF APPEALS
                                                                                FILED
                            FOR THE ELEVENTH CIRCUIT U.S. COURT OF APPEALS
                              ________________________ ELEVENTH CIRCUIT
                                                                           APR 13, 2007
                                     No. 06-13637                        THOMAS K. KAHN
                               ________________________                      CLERK

                      D. C. Docket No. 04-00502-CR-2-VEH-JEO

UNITED STATES OF AMERICA,

                                                                           Plaintiff-Appellee,

                                            versus

HANNIBAL SONNY CRUMPLER,

                                                                       Defendant-Appellant.

                               ________________________

                      Appeal from the United States District Court
                         for the Northern District of Alabama
                            _________________________

                                       (April 13, 2007)

Before HULL and MARCUS, Circuit Judges, and BARZILAY,* Judge.

       *
        Honorable Judith M. Barzilay, Judge, United States Court of International Trade, sitting
by designation.
BARZILAY, Judge:

      This case arises on appeal from Defendant-Appellant Hannibal Sonny

Crumpler’s (“Crumpler” or “Defendant-Appellant”) conviction for conspiracy to

commit fraud and for providing false statements to auditors, pursuant to 15 U.S.C.

§§ 78j(b), 78ff, 78m(a) & (b)(2), 18 U.S.C. §§ 2, 371, and 17 C.F.R. §§ 240.10b-5,

240.13b2-1, 240.13b2-2(a), and the resulting forfeiture under 18 U.S.C.

§ 981(a)(1)(C) and 28 U.S.C. § 2461(c). Crumpler raises five principal arguments

in his appeal. He maintains (1) that the district court abused its discretion by

determining that his notes did not qualify for admission under the business records

exception to the hearsay rule; (2) that the court improperly imposed and enforced

general guidelines for questioning witnesses; (3) that the court abused its discretion

when it denied Crumpler’s attempt to question a witness about whether the witness

had previously claimed under oath to be the smartest man in the world; (4) that the

application of the Civil Asset Forfeiture Reform Act (“CAFRA”) to proceeds that

Crumpler obtained before the law’s effective date violated the Ex Post Facto

Clause of the United States Constitution; and (5) that the jury’s forfeiture verdict

based upon Crumpler’s stock options should have assessed the stocks’ value at the

time that he exercised his options, rather than when he sold the stock. For the

reasons stated below, the Court affirms the district court on all grounds.

                                           2
                      I. Jurisdiction and Standard of Review

      This Court has jurisdiction over appeals from the judgment of criminal

conviction from the District Court of Northern Alabama pursuant to 28 U.S.C.

§ 1291.

          II. Exclusion of Evidence Under the Business Records Exception

      “The district court has broad discretion in ascertaining admissibility of

business record evidence, which should not be disturbed on review in absence of

abuse.” United States v. Garnett, 122 F.3d 1016, 1018 (11th Cir. 1997) (per

curium); accord United States v. Petrie, 302 F.3d 1280, 1285 (11th Cir. 2002). In

keeping with this deferential standard of review, this Court “review[s] factual

findings regarding the admissibility of business records . . . under a clearly

erroneous standard.” Petrie, 302 F.3d at 1285. If the Court finds an abuse of

discretion, it still will not reverse the lower court’s decision “unless the evidence

had a substantial impact on the verdict,” i.e., was not harmless. United States v.

Campbell, 73 F.3d 44, 47 (5th Cir. 1996) (per curium); accord United States v.

Fallen, 256 F.3d 1082, 1091 (11th Cir. 2001). The Court, in turn, determines

whether an error was harmless “by weighing the record as a whole, . . . examining

‘the facts, the trial context of the error, and the prejudice created thereby as

juxtaposed against the strength of the evidence of [the] defendant’s guilt.’” United

                                            3
States v. Hands, 184 F.3d 1322, 1329 (11th Cir. 1999) (quoting United States v.

Reed, 700 F.2d 638, 646 (11th Cir. 1983)). “Harmless error review . . . does not

require [the court] to view witnesses’ credibility in the light most favorable to the

government.” Id. at 1330 n.23.

       Rule 803(6) of the Federal Rules of Evidence permits into evidence

       [a] memorandum, report, record, or data compilation, in any form, of
       acts, events, conditions, opinions, or diagnoses, made at or near the
       time by, or from information transmitted by, a person with
       knowledge, if kept in the course of a regularly conducted business
       activity, and if it was the regular practice of that business activity to
       make the memorandum, report, record or data compilation, all as
       shown by the testimony of the custodian or other qualified witness, or
       by certification that complies with Rule 902(11), Rule 902(12), or a
       statute permitting certification, unless the source of information or the
       method or circumstances of preparation indicate lack of
       trustworthiness.

Fed. R. Evid. 803(6). “It is not necessary for the person who actually prepared the

documents to testify so long as there is other circumstantial evidence and testimony

to suggest the trustworthiness of the documents.” Garnett, 122 F.3d at 1019.

Likewise, “it is not necessary that a sponsoring witness be employed by the

business at the time of the making of each record. The witness must only be in a

position to attest to its authenticity.” United States v. Evans, 572 F.2d 455, 490

(5th Cir. 1978) (internal citation omitted).1

       1
        In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981) (en banc), this
Court adopted as binding precedent all decisions handed down by the former Fifth Circuit before

                                               4
A. The District Court Properly Refused to Allow the Notes into Evidence

       During the trial, Crumpler sought to enter into evidence six handwritten and

typed notes that he wrote which concerned his actions relating to the fraud and

conspiracy for which he was convicted. See Appellant’s Ex. 18-A–F; R.E.2 Tab E.

According to Defendant-Appellant, “[t]he only specific evidence that tied [him] to

the conspiracy was the testimony of Weston Smith and Bill Owens regarding the

March 2002 confirmation letters,” without which “the Government would not have

proven Defendant Crumpler’s guilt beyond a reasonable doubt.” Appellant’s Br.

23. Appellant claims that these documents would have undermined Smith and

Owens’ testimony because they “established [Crumpler’s] good faith and lack of

criminal intent with respect to the confirmation letters by showing that he did not

act in concert with the conspirators at HealthSouth.” Appellant’s Br. 24.

       During the evidentiary hearing, Michael A. Plaia, once Senior Vice

President of Planning and Development for Source Medical, later Senior Vice

President Chief Operating Officer, and a custodian of HealthSouth’s records,

testified that he recognized the documents in question, verified that Crumpler

created them at the time of the audit confirmation process at HealthSouth, and

the close of business on September 30, 1981.
       2
           “R.E.” stands for Record Excerpts.

                                                5
attested to the fact that Crumpler had knowledge of the events detailed within the

documents. He also confirmed that Crumpler created the documents as a part of

his regular business practice, one shared by most of HealthSouth’s management.

See Appellant’s R.E. Tab D 17–28. Likewise, Larry D. Carr, an accountant with

no formal ties to HealthSouth, testified that he recognized the documents, helped

Crumpler draft some of them, and believed the contents of the documents to

accurately reflect what he knew of the events discussed within them, though this

knowledge apparently came from Crumpler himself. See Appellant’s R.E. Tab D

33, 35–36, 47–49.

      The district court ruled the documents inadmissable on several grounds.

First, it found Larry Carr unqualified to attest to their authenticity since he did not

work for HealthSouth. See Appellant’s R.E. Tab D 58. It also held Mr. Plaia’s

testimony inadequate because he “did not testify that it was [Crumpler’s] and

Source Medical Solutions Incorporated’s practice to maintain these notes in the

files as a part of the regular course of [its] business” and “[could] not testify that

the notes are accurate.” Appellant’s R.E. Tab D 59–60. The court also declared

that “the source of information in the notes is the defendant, who is accused of

fraud in the very dealings his writings seek to explain. Thus, the source of the

information indicates lack of trustworthiness.” Appellant’s R.E. Tab D 59–60.

                                            6
Finally, the court reasoned that the testimony of Carr and Plaia did not sufficiently

demonstrate that Crumpler had not prepared the documents in anticipation of

criminal or civil litigation. See Appellant’s R.E. Tab D 61.

      Though the district court erred in portions of its analysis, its decision to

exclude the documents from evidence was not an abuse of discretion. First,

contrary to the court’s assertion, the hearing transcript clearly demonstrates that

Mr. Plaia testified that creating and maintaining the documents in question was a

business practice of HealthSouth management and Crumpler himself. See

Appellant’s R.E. Tab D 22–23. Moreover, that Plaia could not testify to the

accuracy of the information contained within the notes is immaterial. See

Rosenberg v. Collins, 624 F.2d 659, 665 (5th Cir. 1980) (“Any person in a position

to attest to the authenticity of certain records is competent to lay the foundation for

the admissibility of the records; he need not have been the preparer of the record,

nor must he personally attest to the accuracy of the information contained in the

records.”). However, while it is generally understood that “[t]he bare fact that the

man who supervised the making of the records relies on them is no bar to their

admission into evidence” as business records, the circumstances of this case

arguably warranted departure from this stance. Lind v. Schenley Indus., Inc., 278

F.2d 79, 88 (3d Cir. 1960). Neither Plaia nor Carr could

                                           7
      testify about the initial link in the chain producing the record[s] – that
      is, whether the circumstances surrounding the origination and
      compilation of the documents indicate reliability and trustworthiness.
      In this case, such testimony is particularly necessary because this case
      revolves around allegations of fraudulent transactions involving
      financial documents drafted by the very parties who created the
      documents the defendant now seeks to introduce . . . .

Petrie, 302 F.3d at 1288 (quotations & citations omitted); see also United States v.

N.Y. Foreign Trade Zone Operators, Inc., 304 F.2d 792, 797 (2d Cir. 1962) (citing

Palmer v. Hoffman, 318 U.S. 109, 113, 114, 63 S. Ct. 477, 480, 481 (1943)). The

lower court was not clearly erroneous in finding that Crumpler did not satisfy the

trustworthiness element of the business records exception and, therefore, could not

submit the notes into evidence.

      Furthermore, even if the district court erred, the exclusion of the documents

would have constituted harmless error. An examination of the record demonstrates

that most of the content in the documents that Crumpler deemed crucial to his

defense entered the record through the confirmation letters, his responses to those

letters, and the testimony of Daryl Brown. See, e.g., Trial Tr. (“Tr.”) vol. 15,

66–73, 82, Nov. 15, 2005; Tr. vol. 16, 5–9, 15, 44–45, 47–48, Nov. 16, 2005.

Their exclusion therefore minimally prejudiced Defendant-Appellant’s case, if at

all. In addition, the testimony of Emery Harris, Bill Owens, Weston Smith, and

Kenneth Livesay proved so incriminating that admission of the notes into evidence

                                           8
would not have had a discernable impact on the trial’s outcome. See, e.g., Trial Tr.

vol. 11, 86, 88, 149, 168, Nov. 8, 2005; Tr. vol. 14, 16–17, Nov. 14, 2005; Tr. vol.

12, 60–65, Nov. 9, 2005; see also Tr. vol. 11, 153–55. The district court’s decision

not to allow Crumpler’s notes into evidence is affirmed.

                    III. The Questioning of Witnesses at Trial

      Defendant-Appellant also objects to the district court’s imposition and

enforcement of general restrictions on the questioning of witnesses. More

specifically, according to Crumpler, the district court violated the Confrontation

Clause when it refused to allow him to ask Bill Owens, one of the government’s

key witnesses, whether in prior judicial proceedings he asserted that he believed

himself to be the smartest man in the world.

      The Sixth Amendment guarantees a criminal defendant the right “‘to be

confronted with the witnesses against him’” – a right which includes “the right to

conduct reasonable cross-examination.” Olden v. Kentucky, 488 U.S. 227, 231,

109 S. Ct. 480, 482–83 (1988) (per curium) (quoting U.S. Const. amend. VI.);

accord United States v. Arias-Izquierdo, 449 F.3d 1168, 1178 (11th Cir. 2006),

cert. denied, 127 S. Ct. 521 (2006); 127 S. Ct. 996 (2007); 127 S. Ct. 1001 (2007);

127 S. Ct. 1041 (2007). In practice, this guarantee means that “the cross-examiner

has traditionally been allowed to impeach . . . the witness,” since “the exposure of a

                                          9
witness’ motivation in testifying is a proper and important function of the

constitutionally protected right of cross-examination.” Olden, 488 U.S. at 231, 109

S. Ct. at 483 (quotations & citation omitted); see Arias-Izquierdo, 449 F.3d at 1178

(“[T]he Confrontation Clause requires a defendant to have some opportunity to

show bias on the part of a prosecution witness.”). Accordingly, “[a] defendant’s

confrontation rights are satisfied when the cross-examination permitted exposes the

jury to facts sufficient to evaluate the credibility of the witness and enables defense

counsel to establish a record from which he properly can argue why the witness is

less than reliable.” Arias-Izquierdo, 449 F.3d at 1178 (quotations & citation

omitted). Nevertheless, “[t]rial judges retain wide latitude to impose reasonable

limits on cross-examination based on concerns about, among other things,

confusion of the issues or interrogation that is repetitive or only marginally

relevant.” Id. (quotations & citation omitted) (brackets in original); accord Olden,

488 U.S. at 231, 109 S. Ct. at 483.

      If the trial court violated the defendant’s right to impeach a witness, this

Court must determine

      “whether, assuming that the damaging potential of the cross-
      examination were fully realized, a reviewing court might nonetheless
      say that the error was harmless beyond a reasonable doubt. Whether
      such an error is harmless in a particular case depends upon a host of
      factors, all readily accessible to the reviewing courts. These factors
      include the importance of the witness’ testimony in the prosecution’s

                                          10
       case, whether the testimony was cumulative, the presence or absence
       of evidence corroborating or contradicting the testimony of the
       witness on material points, the extent of cross-examination otherwise
       permitted, and, of course, the overall strength of the prosecution’s
       case.”

Olden, 488 U.S. at 232–33, 109 S. Ct. at 483–84 (quoting Delaware v. Van

Arsdall, 475 U.S. 673, 684, 106 S. Ct. 1431, 1438 (1986)) (emphasis added); see

United States v. Mills, 138 F.3d 928, 938 (11th Cir. 1998) (“[T]he ‘harmless

beyond a reasonable doubt standard’ already respects the constitutional origin of

the right and elevates it over mere statutory or evidence-rule rights.”); Wasko v.

Singletary, 966 F.2d 1377, 1383 (11th Cir. 1992).

A. The General Guidelines for Questioning Witnesses

       Near the commencement of the trial, the district court distributed to parties’

counsel a handout with instructions on how to question witnesses throughout the

trial. It read:

       1. Except when the last sentence of Rule 611(c) is clearly applicable,
       do not lead on direct. Ask questions in a fashion which does not
       suggest the answer.

       2. On cross-examination, leading questions should be succinct and not
       loaded or long, rambling statements. The evidence should not be
       recounted. The question should be a question within itself. Do not
       make a long, rambling, compound statement and then say

       “Did you?”
       “Isn’t that true?”
       “Have you?”

                                          11
      “Do you agree?”
      “Correct?” etc.

      Do not argue.

      Again, with emphasis:

      1. Do not lead on direct.

      2. On cross, do not lead, ramble, or make long, rambling compound
      statements followed by:

      “Isn’t it true,” “correct,” “do you agree,” etc. or other second
      questions.

      Ask succinct, one sentence questions, even when leading.

      To do the contrary[] leads to excessive delays. Repeated violations
      will result in sanctions. Interim violations may result in open court
      corrections.

      Do not make argumentative asides or engage in repartee with
      opposing counsel.

Appellee’s Br. 34; see Appellant’s Br. 40 n.14. The district court issued these

instructions to facilitate the flow of the trial and to avoid unnecessary delays or

confusion, and they appear well-tailored to achieve this purpose. None of the

listed interrogatory prohibitions inhibited Crumpler from effectively cross-

examining the government’s witnesses. See, e.g., Tr. vol. 11, 7–8, 10–11, 14–18;

                                           12
Tr. vol. 12, 21–22, 27–28, 34, 43, 55–57, 70–72; Tr. vol. 13, 123–25, 134–35,

138–40, Nov. 10, 2005. The instructions consequently do not fall afoul of the

Sixth Amendment.

B. The Smartest Man in the World

      Similarly, no Sixth Amendment violation occurred when the district court

refused to allow Crumpler to ask Bill Owens whether he previously stated that he

was the “smartest man on earth.” Crumpler insists that only this line of

questioning could have lead the jury to doubt the veracity of Owens’ testimony,

specifically (1) Owens’ frequent inability to recall facts about which he previously

testified, (2) his last-minute recollection of an incriminating conversation with

Crumpler that he claims he had despite never mentioning it in any previous

interview or investigation, and (3) his supposed inability to understand how to

discuss fraudulent activities with Crumpler while wearing a body recorder.

      The court correctly held that the proposed line of questioning lacked

relevance and, even if it were relevant, was unduly prejudicial to the government.

As Crumpler himself concedes, he managed to have Owens testify that he would

be sentenced for his convictions three weeks after he appeared in Crumpler’s trial.

See Appellant’s Br. 42–43. Though Owens claimed that this timing had no effect

on his behavior, the jury easily could have concluded that Owens had motivation to

                                          13
give false testimony against Crumpler in return for a possibly lighter sentence. See

United States v. Lankford, 955 F.2d 1545, 1548 (11th Cir. 1992) (“The importance

of . . . cross-examination does not depend upon whether or not some deal in fact

exists between the witness and the government. What counts is whether the

witness may be shading his testimony in an effort to please the prosecution.”)

(citation omitted). Furthermore, a jury would not have missed the striking contrast

between Owens’ repeated forgetfulness and his wondrous recollection of a never-

before-mentioned incriminating conversation. Crumpler could have – and indeed

appears to have – exposed Owens’ duplicitous motivations for providing testimony

without depending on the fact that Owens once fancied himself the “smartest man

in the world” be revealed in open court. See, e.g., Tr. vol. 13, 123–25, 134–35,

138–40. Compare Tr. vol. 13, 123 (“A [Owens:] I don’t know what a perjury

conviction is.”), with 134 (“Q [Counsel:] But you drew the line at perjury? A

[Owens:] I did.”) and 135 (“A [Owens:] I came to the conclusion that to keep the

house of cards together, I would have to commit perjury. And that was a line that I

was not willing to cross.”). See United States v. King, 713 F.2d 627, 630 (11th Cir.

1983) (holding that limitation on scope and breadth of cross-examination did not

significantly curtail effectiveness of witness’ cross-examination because cross-

examination was lengthy and extensive). Not only was Crumpler’s proposed line

                                         14
of questioning irrelevant to his defense, see Petrie, 302 F.3d at 1287; Wasko, 966

F.2d at 1381 (“[T]he sixth amendment only protects cross-examination that is

relevant . . . .”), but exposing Owens’ hubris probably would have compelled the

jury to disregard Owens’ testimony not because of its internal inconsistencies, but

because of Owens’ unflattering personality. See King, 713 F.2d at 631 (noting that

Fed. R. Evid. 403 “permits the trial court to exclude evidence otherwise admissible

because the ‘probative value’ of that evidence ‘is substantially outweighed by the

danger of unfair prejudice.’ . . . . The major function of Rule 403 is limited to

excluding matter of scant or cumulative probative force, dragged in by the heels for

the sake of its prejudicial effect.”) (quotations omitted). See generally Hands, 184

F.3d at 1326–29. The district court did not err by prohibiting Crumpler from

asking Owens whether he styled himself the “smartest man on earth.”

     IV. The Use & Application of the Civil Asset Forfeiture Reform Act

      Crumpler asserts that the application of CAFRA to the conspiracy proceeds

that he obtained before the effective date of the Act violated the Ex Post Facto

Clause. Even if the Court finds no violation, he contests the jury’s verdict of

forfeiture based upon his stock options, which set their fair market value at the

stock price when he exercised his options rather than when he sold the stock.

                                           15
      The application of a forfeiture statute, in this case 18 U.S.C. § 981(a)(1)(C),

and whether it violates the Ex Post Facto Clause is a question of law, and the court

therefore reviews the findings of the district court de novo. See United States v.

Hersh, 297 F.3d 1233, 1244 (11th Cir. 2002). The Ex Post Facto Clause “prohibits

the enactment of statutes that punish as a crime an act previously committed which

was innocent when done.” Id. “[W]hen a defendant is charged with a conspiracy

that continues after the effective date of the statute,” however, no violation occurs.

Id.

      The jury in the trial court convicted Crumpler of such a “straddling”

conspiracy. Although the conspiracy began prior to the August 23, 2000, date

upon which CAFRA became effective, it continued beyond that date through

March 2002, rendering all proceeds that Crumpler acquired due to the conspiracy

– specifically the stock options that he exercised in 1997 and the bonuses that he

received from 1996 through May 2000 – subject to the forfeiture statute. The

district court’s application of CAFRA to these proceeds thus did not violate the Ex

Post Facto Clause.

      Crumpler further argues that the court improperly valued the proceeds of the

stock he fraudulently acquired by treating the date that he exercised his stock

options as dispositive. He avers that the district court should have valued the stock

                                          16
at the time he sold it because prior to that event, the stock’s value merely

constituted unrealized gains. See Appellant’s Br. 49. Crumpler’s argument,

however, has no basis in statutory or case law; rather, it appears to derive from

capital gains taxation accounting practices. As demonstrated by the statute itself,

“[a]ny property, real or personal, which constitutes or is derived from proceeds

traceable to . . . a conspiracy to commit such an offense” is subject to forfeiture.

18 U.S.C. § 981(a)(1)(C) (emphasis added). Congress did not limit the statute’s

reach to liquid assets or cash. Accordingly, Crumpler need not have sold his stock

to render the proceeds subject to forfeiture. See 28 U.S.C. § 2461(c) (ordering

forfeiture under CAFRA to be exercised as described under 18 U.S.C. § 3554); 18

U.S.C. § 3554 (ordering forfeiture under section to occur in accordance with 18

U.S.C. § 1963); 18 U.S.C. § 1963 (RICO forfeiture statute); United States v.

Conner, 752 F.2d 566, 575 (11th Cir. 1985) (stating that “[e]very property interest,

including a right to profits or proceeds[,] may be described as an interest in

something” when applying RICO forfeiture statute) (emphasis added), 576 (“Since

the forfeiture is in personam, it follows the defendant as a part of the penalty and

thus it does not require that the government trace it . . . . It matters not that the

government received the identical money which the defendants received as long as

the amount that was received . . . is known.”); United States v. Simmons, 154 F.3d

                                            17
765, 770 (8th Cir. 1998) (noting that under 18 U.S.C. § 1963, “[d]efendants . . .

must forfeit any property constituting, or derived from, any proceeds which the

person obtained”) (defining “proceeds” under RICO forfeiture statute as meaning

“gross receipts of the illegal activity”). Moreover, it would be absurd to permit a

criminal to mitigate the value of property that he must forfeit by squandering or

poorly investing the illegally acquired proceeds, which Crumpler’s argument

essentially proposes. The district court applied the forfeiture statute appropriately,

and its holding is affirmed.

                                    V. Conclusion

      After review and oral argument, and for the reasons outlined above, we

affirm the actions of the district court on all matters contested by Defendant-

Appellant.

      AFFIRMED.

                                          18