Court Opinion

ID: 219420
Source: CourtListenerOpinion
Date Created: 2011-06-22 18:54:19+00
Date Added: 2024-06-11T17:28:40.445712
License: Public Domain

UNPUBLISHED

                    UNITED STATES COURT OF APPEALS
                        FOR THE FOURTH CIRCUIT

                             No. 08-4583

UNITED STATES OF AMERICA,

                Plaintiff - Appellee,

          v.

LAURINDA HOLOHAN,

                Defendant - Appellant.

Appeal from the United States District Court for the Eastern
District of North Carolina, at Raleigh. W. Earl Britt, Senior
District Judge. (5:07-cr-00117-BR-4)

Submitted:   May 31, 2011                   Decided:   June 22, 2011

Before NIEMEYER, DAVIS, and KEENAN, Circuit Judges.

Affirmed by unpublished per curiam opinion.

Mary J. Darrow, LAW OFFICE OF MARY JUDE DARROW, Raleigh, North
Carolina, for Appellant.    George E. B. Holding, United States
Attorney, Jason H. Cowley, Jennifer P. May-Parker, Assistant
United States Attorneys, Raleigh, North Carolina, for Appellee.

Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:

                 Laurinda Holohan appeals her conviction and seventy-

six month sentence on one count of conspiracy to commit mail

fraud in violation of 18 U.S.C. § 371 (2006) and twelve counts

of mail fraud and aiding and abetting in violation of 18 U.S.C.

§§ 1341, 2 (2006).                She argues that the district court erred in

denying her motion to sever her trial from that of her co-

defendants           and        that   insufficient       evidence      supports     her

conviction.          We affirm.

                 This case arises out of a Ponzi scheme spanning more

than twenty states and involving millions of dollars of loss.

The indictment naming Holohan also charged six co-defendants:

Michael         A.   Lomas,      Michael   L.   Young,    Barry   C.   Maloney,     Susan

Knight,         Scott      B.   Hollenbeck,     and   Arthur    J.    Anderson. *    The

government alleged that Lomas and Young were the principals of a

company that would ultimately become known as Mobile Billboards

of America (“MBA”).               Lomas and Young hired Holohan and Knight to

work       in   an    administrative        capacity     for   MBA,    and   they   hired

Hollenbeck           and    Anderson       to   serve    as    salesmen,     recruiting

investors.           Maloney, MBA’s corporate attorney, was alleged to

       *
       In United States v. Lomas, 392 Fed.Appx. 122, 2010 WL
3034086 (4th Cir. 2010), we affirmed the judgment of sentence
(240 months) entered against Lomas based on his guilty plea and
upheld a restitution award in excess of $45 million.

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have assisted in “implementing the legal documents associated

with the defendants’ scheme.”                    While many of the participants in

the   scheme        pled        guilty,     Holohan,          Hollenbeck       and      Maloney

proceeded to trial.

             Briefly, the government’s theory of the case was that

MBA   used    its    salespeople          to     recruit      investors       who    purchased

“frames”     for     the        display     of       advertisements       that       would   be

installed on the sides of truck trailers.                           The frames were then

leased to MBA.             The investors were promised a certain fixed

return    monthly      (a       lease     payment)          generated    by     selling      the

billboard     space        on     the     frames       for    advertising        use.        The

investors were further promised that their investments would be

guaranteed      and     insured,          and        they    were    assured         that    the

investments were sound.                 Unbeknownst to the investors, MBA was

unable to generate advertising revenue sufficient to cover the

monthly lease payments, and was using investment capital to fund

those payments.            In addition, Lomas was embezzling significant

sums for personal purchases.

             Prior to trial, the defendants moved to sever their

trials,      claiming       that        their     antagonistic         defenses       and    the

disparity      of     admissible           evidence          against     each       would     be

prejudicial.        The court denied the motions.                    At the nearly five-

week jury trial, the government adduced evidence from victims of

the   alleged       scheme,       investigators,            regulators,       attorneys      and

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financial service providers who did business with MBA, and from

members of the alleged conspiracy, including Lomas, who had pled

guilty    and    were   cooperating        with    the   government.         At   the

conclusion of the trial, Maloney was acquitted and Holohan and

Hollenbeck were convicted of each count of the indictment that

remained after the government moved to dismiss several of the

substantive mail fraud charges.                 Holohan received a seventy-six

month    sentence    for   her     role   in    the   scheme,   and   this    appeal

followed.

                              I.    Motion to Sever

               Holohan first argues that the court erred in denying

her motion to sever her trial from that of her co-defendants.

Holohan specifically argues that under the well-known standards

of Zafiro v. United States, 506 U.S. 534 (1993), severance was

required because, as she claims to have projected in her pre-

trial motion, she suffered substantial prejudice in the joint

trial with Hollenbeck and Maloney.                 We review the denial of a

motion    to    sever   for   abuse   of       discretion.      United   States    v.

Mackins, 315 F.3d 399, 412 (4th Cir. 2003).

               “There is a preference in the federal system for joint

trials of defendants who are indicted together,” and a district

court should grant a severance “only if there is a serious risk

that a joint trial would compromise a specific right of one of

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the   defendants,      or   prevent   the    jury    from    making    a   reliable

judgment about guilt or innocence.”             Zafiro, 506 U.S. at 537-38.

The   presumption      that   defendants     indicted       together   should   be

tried together is especially strong in conspiracy cases.                     United

States v. Chorman, 910 F.2d 102, 114 (4th Cir. 1990).                      Mutually

antagonistic defenses alone are insufficient to merit severance.

United   States   v.    Najjar,    300   F.3d   466,      474   (4th Cir. 2002).

Instead, “there must be such a stark contrast presented by the

defenses that the jury is presented with the proposition that to

believe the core of one defense it must disbelieve the core of

the other,” or the conflict will lead to the jury’s unjustified

inference of both defendants’ guilt.                Id.   This standard is not

satisfied here.

           Holohan argues that as a result of the denial of her

motion she was denied a fair trial (and thus, she says, due

process). This contention rests on her assertion that certain

“inflammatory” victim testimony, including testimony describing

how Hollenbeck, the salesman, targeted “churchgoing retirees” as

victims of the fraudulent scheme, was irrelevant to her guilt or

innocence and thus would not have been admitted against her had

she been tried alone.         This argument is without merit.

           Evidence of how the scheme was operated, including the

manner of selecting potential victims, was clearly admissible

against all of the alleged members of the overall scheme to

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defraud.      Holohan fully enjoyed the assistance of counsel and

had   every     opportunity       to    object          to    assertedly      “irrelevant”

evidence and to cross-examine each of the witnesses called by

the   government       or   her   co-defendants.               She    was    able     to   ask

victims    of    the    scheme,     for    example,            whether      they    had    any

interaction with her or knew her.                       In particular, counsel for

Holohan was also able to cross-examine Lomas (who testified in

favor of the government) and Maloney (who testified on his own

behalf) and attempt to show that they were the culpable parties,

not her.        Notably, Holohan does not assign as error on appeal

any   distinct         ruling     on    the         admissibility           of     evidence;

furthermore, while she complains generally about the absence of

“limiting instructions,” she has not suggested that she actually

sought any limiting instructions from the district court or that

the court specifically denied any such requests.                                 In sum, we

discern no support in the record for the assertion that Holohan

was denied a fair trial by virtue of the district court’s denial

of her motion to sever.

              Separately,       Holohan    claims            that    the    jury’s    guilty

verdict cannot be deemed “reliable” because of the “enormous and

inflammatory amount of evidence presented at this complex trial

against Hollenbeck.”            Maloney’s acquittal belies this claim, as

the   jury      was    obviously       able        to    distinguish        the      relative

culpability of the defendants.                    In addition, it is well-settled

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that the mere fact that Holohan’s acquittal might have been more

likely    if    she    were    tried      alone         is    simply    not    sufficient    to

warrant a severance.            See United States v. Strickland, 248 F.3d

368, 384 (4th Cir. 2001).

               Accordingly,      we      reject         the   claim     that   the    district

court abused its discretion in denying the motion to sever.

                       II.     Sufficiency of the Evidence

               Holohan next argues that the evidence adduced at trial

was insufficient to sustain her conviction.                             This court reviews

challenges to the sufficiency of the evidence supporting a jury

verdict de novo.              United States v. Kelly, 510 F.3d 433, 440

(4th Cir. 2007).            “A defendant challenging the sufficiency of

the evidence faces a heavy burden.”                           United States v. Foster,

507    F.3d     233,    245    (4th Cir. 2007).                  This    court    reviews     a

sufficiency of the evidence challenge by determining whether,

viewing       the   evidence        in    the       light      most     favorable     to    the

government, any rational trier of fact could find the essential

elements       of   the     crime     beyond        a    reasonable       doubt.        United

States v. Collins, 412 F.3d 515, 519 (4th Cir. 2005).                                We review

both     direct       and     circumstantial             evidence,       and     accord     the

government all reasonable inferences from the facts shown to

those sought to be established.                         United States v. Harvey, 532

F.3d 326, 333 (4th Cir. 2008).                      In reviewing for sufficiency of

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the evidence, we do not review the credibility of the witnesses,

and we assume that the jury resolved all contradictions in the

testimony in favor of the government.                      Kelly, 510 F.3d at 440.

This     court    will     uphold     the    jury’s        verdict      if     substantial

evidence supports it, and will reverse only in those rare cases

of clear failure by the prosecution.                    Foster, 507 F.3d at 244-

45.

            The elements of mail fraud are:                    (1) the existence of

a scheme to defraud, and (2) the use of mails to perpetrate the

scheme.          United     States     v.        Vinyard,      266      F.3d    320,   326

(4th Cir. 2001).          To establish the first element, the government

had to prove that Holohan “acted with the specific intent to

defraud,     which    may     be     inferred       from    the      totality     of   the

circumstances       and    need     not     be    proven     by      direct     evidence.”

United    States     v.    Godwin,     272       F.3d   659,      666   (4th Cir. 2001)

(internal quotation marks and citations omitted). (In addition,

the government proceeded on an aiding and abetting theory.)                            “To

find [Holohan] guilty of conspiracy to commit mail fraud, the

jury had to find ‘an agreement [to commit mail fraud], willing

participation by [Holohan], and an overt act in furtherance of

the agreement.’” United States v. Edwards, 188 F.3d 230, 234

(4th Cir. 1999) (citing United States v. Dozie, 27 F.3d 95, 97

(4th Cir. 1994)).

                                             8
             Holohan     argues      that   the       government      did   not    adduce

sufficient evidence that she had the specific intent to defraud,

and   accordingly,      did    not   satisfy       the   elements      of   either      the

substantive offenses or the conspiracy charge.                         At bottom, her

claim is that she lacked education and sophistication, and her

role at NPC and MBA was purely administrative.                        She argues that

she had no knowledge of Hollenbeck’s activities and was simply

following orders from Lomas and Young.

             Holohan’s argument lacks merit.                   The evidence adduced

at trial indicated that although Holohan worked in a largely

administrative      capacity,        she    willfully         participated        in    the

overall   scheme    to    defraud      with      significant        knowledge      of   its

essential    character:        (1)   she    knew      that    the   business      was    in

serious     financial     trouble       because        there    was     virtually       no

advertising revenue; (2) she was clearly aware that Lomas was

using   investor    money      for    his   personal         expenditures,        and   she

herself received the benefit of a free company Jaguar automobile

and, over the course of less than five years, a series of non-

salary bonuses exceeding two hundred thousand dollars; (3) she

knew that investor money was being improperly used to make lease

payments;     (4)   she       knew   that       MBA    was    using    deceitful        and

misleading     advertisements          that      implied       they     were      raising

advertising revenue and that revenue would be used to make the

lease payments, when those representations simply were not true;

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(5) she knew that while MBA advertising materials claimed that

investor funds would be kept in trust, inaccessible to MBA or

its related entities, this was not the case.                        In light of the

direct     and   circumstantial      evidence         presented        at    trial,    we

conclude    that   the   jury    acted     reasonably        in   finding     beyond   a

reasonable doubt that she was guilty and we do not disturb its

verdict.

            Accordingly, we affirm the judgment of the district

court.     We dispense with oral argument because the facts and

legal    contentions     are    adequately      presented         in   the    materials

before   the     court   and    argument      would    not    aid      the   decisional

process.

                                                                               AFFIRMED

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