Court Opinion

ID: 220111
Source: CourtListenerOpinion
Date Created: 2011-06-30 19:13:54+00
Date Added: 2024-06-11T17:28:42.726633
License: Public Domain

UNPUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT

                            No. 09-5070

UNITED STATES OF AMERICA,

                Plaintiff - Appellant,

           v.

WILLIAM CARL SOUDER, JR.; MARVIN DEAN CHAMBERS, SR.; ALVIN
LEWIS ELLIOTT, SR.,

                Defendants – Appellees.

Appeal from the United States District Court for the Middle
District of North Carolina, at Greensboro. James A. Beaty, Jr.,
Chief District Judge. (1:08-cr-00136-JAB-1)

Argued:   March 25, 2011                  Decided:   June 30, 2011

Before TRAXLER, Chief Judge, and WILKINSON and DIAZ, Circuit
Judges.

Affirmed in part, reversed in part, and remanded by unpublished
opinion.   Judge Diaz wrote the opinion, in which Chief Judge
Traxler and Judge Wilkinson joined.

ARGUED:    Frank J. Chut, Jr., OFFICE OF THE UNITED STATES
ATTORNEY, Greensboro, North Carolina, for Appellant.   James E.
Ferguson, II, FERGUSON STEIN CHAMBERS GRESHAM & SUMTER, P.A.,
for Appellees.   ON BRIEF:   Anna Mills Wagoner, OFFICE OF THE
UNITED   STATES  ATTORNEY,  Greensboro,  North   Carolina,  for
Appellant. Thomas H. Johnson, Jr., GRAY, JOHNSON & LAWSON, LLP,
for Appellee Souder; Eric D. Placke, OFFICE OF THE       FEDERAL
PUBLIC DEFENDER, Greensboro, NC, for Appellee Elliott.

Unpublished opinions are not binding precedent in this circuit.

                               2
DIAZ, Circuit Judge:

     William Carl Souder, Jr., Marvin Dean Chambers, Sr., and

Alvin     Lewis    Elliott,        Sr.    (“Defendants”)                were     indicted     in

Greensboro,       North    Carolina      on        nine    counts       of     mail   fraud    in

violation of 18 U.S.C. § 1341.                       The Defendants, along with a

fourth co-defendant, James Henry Wilcher, were also charged in a

second indictment with honest services mail fraud in violation

of 18 U.S.C. §§ 1341 and 1346.                     After a thirteen-day trial that

began    on    June     30,   2009,      the       jury    returned          guilty   verdicts

against the Defendants as to all counts in both indictments, but

acquitted Wilcher.

        The   Defendants      filed       a    joint       post-verdict           motion      for

judgment of acquittal, which the district court granted.                                      The

district      court    also   conditionally           granted       a    new     trial.       The

government timely appealed. 1                  We hold that the district court

erred in granting judgment of acquittal and therefore reverse as

to that issue.            Applying the much more deferential “abuse of

discretion”       standard        to    the        district    court’s           decision     to

conditionally         grant   a   new    trial,       we    affirm       that    ruling,      and

remand for further proceedings.

     1
       The government has since dismissed its appeal with respect
to the honest services mail fraud charges in the second
indictment.

                                               3
                                            I.

     We     review     first    the    trial       court’s    order    granting      the

Defendants’ motion for judgment of acquittal.                    As to this issue,

we   view    the     evidence    in    the       light    most   favorable    to     the

government and recite the facts accordingly.

     This case stems from a supplemental life insurance program

developed by the Defendants for the Most Worshipful Prince Hall

Grand Lodge of Free and Accepted Masons of North Carolina and

Jurisdiction, Inc. (“Grand Lodge”).                      The Grand Lodge oversees

approximately        three     hundred      local    Masonic     lodges      scattered

throughout North Carolina, which, at the time of these events,

boasted over 18,000 individual members or Masons.                         Defendants

Chambers and Elliott were salaried officers of the Grand Lodge,

serving     as   Grand   Master       and    Grand       Secretary,    respectively.

Defendant Souder was President and CEO of Atlanta Life General

Agency, Inc. (“ALGA”), a corporate subsidiary of Atlanta Life

Insurance    Company.        ALGA’s      primary     business    was   the    sale    of

insurance products underwritten by other companies, from which

it earned commissions.           Defendant Wilcher was an insurance agent

and owner of the Wilcher Group, based in Johnsonville, South

Carolina.

     Stated broadly, the government’s theory of the case was

that the Defendants misrepresented the terms of the supplemental

                                             4
life    insurance     program       to   the     Masons   by,     at    least     in   some

instances, binding Masons (and the Grand Lodge) to pay premiums

on insurance policies that (1) exceeded the amount of the death

benefit sought by the Mason, and (2) named the Grand Lodge as a

partial beneficiary without the Mason’s consent.                        In furtherance

of     the   alleged        scheme,      the     Defendants        mailed       so-called

“certificates        of   insurance”       to    Masons     that       understated      the

amount of insurance obtained by the Mason and failed to disclose

that the Grand Lodge was a partial beneficiary of the policy.

According     to    the   government,       this    scheme       directly     benefitted

Souder, in that he earned commissions on all policies issued,

and had the potential to benefit Chambers and Elliott, who, as

the Grand Lodge’s senior officers, would have free rein over the

use of the death benefit proceeds accruing to the Grand Lodge.

       Before offering the supplemental insurance program at issue

in   this    case,    the      Grand     Lodge    provided       each    Mason    a    $500

benefit,     payable      to    a   surviving      beneficiary         upon   a   Mason’s

death.       This    death     benefit     was    paid    from    the    Grand    Lodge’s

“Benevolence Fund,” which was funded primarily by the Masons’

annual dues.        Benevolence Fund monies were held in trust by the

Grand Lodge and were to be used for the purpose of paying death

benefits to beneficiaries.

                                            5
        In   late    2001    or    early       2002,   Chambers   met   Wilcher   at   a

conference where they discussed the prospect of developing a

supplemental insurance program for the Grand Lodge.                           Chambers

told Wilcher that any such program would have to satisfy certain

requirements, to wit: (1) every Mason had to be able to qualify

without, or with only a modest, physical examination; (2) issued

policies had to be whole life; and (3) the premium structure had

to allow for payment by both the insured Mason and the Grand

Lodge.

        Unable to implement Chambers’s concept, Wilcher introduced

Chambers to Souder.           Chambers and Souder met in Atlanta several

times to discuss the program.                   On or about May 16, 2002, Souder

spoke    with       Jayne   Silven,        a    vice   president    serving   special

insurance markets for American Heritage Life Insurance Company

(“American Heritage”), about the insurance program.                         As Souder

described the program to Silven, the Grand Lodge would own the

individual policies and be responsible for collecting premiums

from the Masons.            Masons under the age of 65 would be eligible

for $25,000 of coverage, while those aged 65 to 75 could obtain

$10,000 in coverage.              Any death benefit paid on $25,000 policies

                                                6
would be split between the insured’s beneficiary and the Grand

Lodge. 2

      After conducting due diligence, American Heritage agreed to

underwrite    the   insurance    program.     In    its    final    form,    the

program provided that the Grand Lodge would receive $15,000 of

any   death   benefit   paid     under   a   $25,000      policy,     with   the

beneficiary    designated   by     the   Mason     receiving    the     $10,000

balance.

      Chambers convened a special session meeting of the Grand

Lodge at its headquarters in Durham, North Carolina on May 25,

2002, where he announced the new insurance program to the Grand

Lodge’s regional directors, deputy wardens, and some rank and

file Masons in attendance.        Many of the attendees were there in

a representative capacity, sent to gather information about the

program to disseminate to their respective local lodges.

      Several hundred Masons attended the May 25 meeting, along

with more than a hundred members of the Grand Lodge’s sister

organization, the Order of the Eastern Star.              Chambers explained

that the program would supplement the death benefits offered

      2
       At trial, several witnesses described this type of split
beneficiary arrangement as a “legacy” program, which is commonly
used in the insurance industry as a funding mechanism for
charitable organizations.

                                     7
through the Benevolence Fund and encouraged Masons to apply.

Souder described the program as a voluntary plan providing a

$10,000 death benefit to the beneficiary of the Mason’s choice.

Souder    also       provided          a    written       summary       of    the    program      that

listed the $10,000 benefit amount and advised the Masons that

they would have to pay $5.50 per week for the coverage, with the

Grand Lodge paying the entire premium for the first quarter that

the individual policies were in place, and thereafter providing

a weekly $3.00 subsidy for each Mason’s policy.                                    At the meeting,

some    Masons       expressed             concern       about    the       impact    of    the    new

program on the Benevolence Fund, but Chambers disclaimed any

intent    to    use           money    from    the       Fund    to    pay    premiums      for    the

insurance program.

       Chambers told those present at the meeting that the Grand

Lodge would be the owner of the policies, would maintain the

policies, and would issue certificates to Masons choosing to

participate          in       the     program.           However,      neither       Chambers      nor

Souder disclosed that the program they were contemplating would

also     provide          a    $25,000        policy      option       that    would       partially

benefit        the        Grand        Lodge.             To     the        contrary,      Chambers

affirmatively represented that the Grand Lodge would not benefit

from the program.                   In response to an inquiry as to whether the

Grand    Lodge       would          receive     any      portion       of    the    $10,000    death

                                                     8
benefit,    Souder      stated     that     each     Mason    would     determine     his

beneficiary and “[t]hat person will receive the $10,000.”                            J.A.

2900 (transcript of tape recording of May 25, 2002 meeting).

Chambers    added,      “[I]f     you   want    to    make    the    Grand   Lodge    the

beneficiary, we get the $10,000.”               Id.

       On June 4, 2002, ALGA and American Heritage signed a formal

letter of intent to issue $10,000 and $25,000 policies.                              ALGA

also    engaged     a    second    insurance         company,       Presidential     Life

Insurance      Company     (“Presidential          Life”),     to     provide   $10,000

insurance coverage for those Masons who failed to qualify for

American       Heritage     policies.              Although     disputed        by    the

Defendants, the government’s evidence showed that at the time of

the May 25 special session meeting, American Heritage was the

only insurance company then being solicited by the Defendants to

provide coverage to the Masons.

       On June 15, 2002, after ALGA and American Heritage signed a

letter    of    intent     to     provide      insurance      coverage--to      include

$25,000     split       beneficiary       policies--Chambers           presented      the

program to the executive committee of the Order of the Eastern

Star.     Again, Chambers did not disclose that the Grand Lodge

would be a partial beneficiary on any $25,000 policies issued,

although he briefly mentioned that the Grand Lodge expected to

                                            9
obtain      some   return        on   the    program       if    there     was    sufficient

participation. 3

       Following these meetings, various regional and local lodge

meetings were held around the state to inform Masons about the

availability         of    the    supplemental         insurance         program       and     to

explain its benefits.                 From June 2002 to August 2003, between

six    and    seven       hundred     Masons       across       the    state     applied      for

insurance      coverage       through        the    program;          approximately      three

hundred      $25,000      policies      were      issued    and       approximately       three

hundred and fifty $10,000 policies were issued.

       ALGA    was    responsible           for    administering         the     program      and

processing the insurance applications.                          Each of the Defendants

participated in teleconferences discussing the manner in which

ALGA       would   process        Mason      applications.              During     one       such

teleconference,           Defendant       Elliott     stated          “[t]hat    the     agents

[processing        the     applications]          should    not       disclose     the       face

amount of the policy to the applicants.”                        Id. 1015.

       Souder and Gloria Giles, the assistant vice president of

training and development at ALGA, trained the policy writing

       3
       According to Chambers, this return would come in the form
of unspecified “residuals” that would flow back to the Grand
Lodge.

                                               10
agents, both in person at ALGA’s offices in Atlanta and via

teleconference.               Giles,          who    reported        directly       to   Souder,

instructed          agents        not    to     complete          the    application      fields

relating       to    the     face       amount       of     the    death      benefit    or    the

beneficiary designation.                  Agents were directed to deliver the

signed applications to Souder’s attention at ALGA.                                  ALGA would

then determine the face amount of the death benefit, calculate

the    premium,       and    name       the    Grand       Lodge    as    a   beneficiary      for

Masons who qualified for $25,000 policies.

       When a Mason applied for insurance under the program, he

also    signed       a    “Required       Disclosure         Statement        for   Accelerated

Benefit Rider,” (“Rider”) which informed the Mason that he might

be eligible for an advance of a percentage of the death benefit,

in the event he was diagnosed with a terminal illness.                                         The

Riders also contained a generic statement that “The minimum face

amount    of    a        policy    that       this       rider    may    be   attached    to    is

$25,000.”            The      Riders,          however,           were    attached       to    all

applications, only some of which resulted in the issuance of

$25,000 policies.            Further, the Riders did not alert Masons that

the Grand Lodge would be a beneficiary on $25,000 policies.

       After issuing the policy, American Heritage delivered it to

ALGA, which then sent it to Chambers and Elliott along with a

request that the Grand Lodge remit the premium payment.                                        The

                                                    11
Grand     Lodge   did   not   forward   policies    to    insured      Masons   but

instead retained them in its files.          However, to provide insured

Masons with some evidence of their arrangement with the Grand

Lodge, Elliott and Chambers, with the assistance of Gloria Giles

at ALGA, prepared certificates of insurance that (1) listed the

name of the Mason’s designated beneficiary, (2) identified the

Grand Lodge as the owner of the policy, (3) represented that the

Mason was entitled to a $10,000 death benefit, and (4) advised

the Mason that his share of the monthly insurance premium was

$22.00.      The certificates did not, however, disclose the face

amount of policies issued for $25,000, did not reflect that the

Grand Lodge was a beneficiary of those policies, and listed a

uniform     “policy     number”   (79647)    that        did    not    match    the

individual Mason’s policy number. 4          Chambers and Elliott signed

the certificates and mailed them to participating Masons. 5

      At the annual Grand Lodge meeting in October 2003, Chambers

and     Elliott   represented     in    writing    that        the    supplemental

insurance program was a success and that it provided a $10,000

      4
       This number instead referred to the uniform billing number
created by ALGA.
      5
       The misrepresentations and omissions contained in the
certificates of insurance underpinned the government’s nine-
count indictment alleging mail fraud.

                                        12
benefit to participating Masons.                    Chambers and Elliott did not

then   disclose    that        some   Masons     had    been   insured       for   $25,000

without    their      knowledge        or     that     the     Grand     Lodge     was     a

beneficiary of such policies.

       In 2003, Chambers was defeated in his bid for re-election

as Grand Master.          The new Grand Lodge leadership terminated the

insurance program, after discovering that the Grand Lodge had

paid over $300,000 in premiums, a portion of which was funded

through the Grand Lodge’s Benevolence Fund.                        Individual Masons

paid over $50,000 in insurance premiums.                        Moreover, only one

insured Mason died during the time the program was in operation,

and his claim for benefits was denied.

       At trial, several Masons testified that they were unaware

they had been insured for $25,000 or that the Grand Lodge was a

beneficiary of their policies.                   The certificates of insurance

also   lulled     some    Masons      into     believing       they    had    a    $10,000

insurance policy with a single beneficiary, when in fact they

were   insured     for    $25,000      with    the     Grand   Lodge     as   a    partial

beneficiary.

       A jury convicted Souder, Chambers, and Elliott of the nine

counts    of   mail   fraud      charged      in    the   first    indictment.           The

district court heard argument on the Defendants’ joint post-

verdict    motion        for     judgment      of      acquittal       and    found      the

                                            13
government’s evidence insufficient as a matter of law to sustain

the    verdicts.      Accordingly,     the   district    court     granted    the

Defendants’ motion and also conditionally granted a new trial.

                                      II.

                                       A.

       The government first contends that the district court erred

in entering judgment of acquittal on the mail fraud counts.                    We

agree and reverse.

       We   review    a   district   court’s     grant   of   a    judgment    of

acquittal de novo, assessing whether, taking the evidence in the

light most favorable to the government, “a rational trier of

fact   could   have    found   the   essential    elements    of   the   charged

offense beyond a reasonable doubt.”            United States v. Singh, 518

F.3d 236, 246 (4th Cir. 2008).               A conviction for mail fraud

under 18 U.S.C. § 1341 requires the government to prove “the

existence of a scheme to defraud, and [] the use of the mails

for the purpose of executing the scheme.”                  United States v.

Godwin, 272 F.3d 659, 666 (4th Cir. 2001).               The government must

also prove that each defendant acted with specific intent to

defraud.     Id.     A scheme or artifice to defraud must employ some

material misrepresentation or concealment of fact.                  See, e.g.,

United States v. Harvey, 532 F.3d 326, 333 (4th Cir. 2008).

                                       14
Common-law       fraud        arises    not     just      from       a    failure      to   disclose

material       information        pursuant          to    a    fiduciary,            statutory,      or

other legal duty, but “ ‘includes acts taken to conceal, create a

false    impression,           mislead,       or    otherwise            deceive       in   order    to

prevent the other party from acquiring material information.’ ”

United    States        v.     Gray,     405       F.3d       227,       235    (4th    Cir.    2005)

(quoting United States v. Colton, 231 F.3d 890, 898 (4th Cir.

2000)).

        The    government        contends       the       evidence         of    the    Defendants’

conduct with respect to the Grand Lodge insurance program was

sufficient        to      sustain        the       mail        fraud       convictions.              In

particular, the government points to evidence tending to show

that the Defendants (1) failed to disclose at the May 25, 2002

meeting        that     the     supplemental            insurance         program       then    being

contemplated          would       include          policies          providing         $25,000       in

insurance coverage with a partial benefit to the Grand Lodge;

(2)   continued         to     misrepresent             the    terms       of    the    program      in

subsequent       discussions           with    Masons,         including          members      of   the

Grand Lodge’s leadership; (3) directed ALGA agents to omit the

policy        amounts     and     beneficiary            designations           on     applications

submitted by participating Masons; (4) created certificates of

insurance       for     mailing        to     participating              Masons      that   did     not

accurately represent the actual policy amounts and failed to

                                                   15
disclose that the Grand Lodge would be a partial beneficiary on

policies issued for $25,000; and (5) deprived both the Grand

Lodge    and   individual       Masons   of    the    money      used    to   fund   the

premium payments for the program.

       As    they   did   at    trial,   the    Defendants        contend     that   the

government improperly “create[d] a crime” from the Defendants’

mismanaged efforts to create an insurance program designed to

benefit both the Grand Lodge and its members.                     Appellee’s Br. 3.

The Defendants maintain that the $25,000 policies that are the

crux    of   the    government’s    case      had    not   yet    been   approved     by

American Heritage at the time of the May 25, 2002 meeting and,

thus, the Defendants could not have materially misrepresented

the terms of those policies.               Although the Defendants do not

dispute that certificates of insurance were prepared and mailed

to participating Masons, they contend that the documents served

only to provide Masons with proof that they were insured and

that their named beneficiary would receive a $10,000 benefit.

According to the Defendants, the Masons were otherwise aware of

the full scope of the insurance program implemented by the Grand

Lodge.

                                         B.

       In    granting     the   motion   for    judgment         of   acquittal,     the

district court concluded that “the Government failed to present

                                         16
substantial evidence, or any evidence for that matter, of any

material misrepresentation or omission made by Defendants with

regard to or in furtherance of a scheme to defraud the Grand

Lodge and its members.”         J.A. 2859.            Viewing the evidence in the

light most favorable to the government, we find the district

court’s conclusion at odds with the record.

        The district court first concluded that statements made by

the     Defendants     at     the    May        25,     2002    meeting      were     not

misrepresentations as to the existence of a $25,000 policy that

would    benefit     the    Grand   Lodge       because     “negotiations       between

Atlanta       Life   and    American   Heritage          [regarding        issuance    of

$25,000 policies] were not complete until June 4, 2002.”                              Id.

2833.      On this issue, however, the district court failed to

credit    the    government’s       evidence          tending   to   show     that    the

Defendants’ intent from the inception of the program was, at

least in part, to benefit the Grand Lodge directly.                            To that

end,    the    evidence    showed   that    Souder        pitched    the    program    to

Jayne Silven on May 16 or 17, 2002 as one where the Grand Lodge

would own any policies issued and would be a partial beneficiary

on certain policies.          This discussion predated the May 25, 2002

meeting at which Chambers and Souder denied that the Grand Lodge

stood to benefit from the program.                    Considering the evidence as

a whole and drawing all inferences in favor of the government, a

                                           17
rational    jury      could     conclude        that    Chambers’s          and   Souder’s

failures to inform the Masons at the May 25 meeting of the

specifics       of   the   insurance      program       then    being       contemplated,

coupled with Chambers’s statements that the Grand Lodge would

not benefit from the program, were material misrepresentations.

      Further, the jury heard evidence that Chambers provided a

summary to the Executive Committee of the Eastern Star on June

15, 2002--after American Heritage had agreed to underwrite the

$25,000 split benefit policies--where he again failed to mention

that the Grand Lodge stood to benefit from the program.                                    The

jury heard additional evidence that Chambers and Elliott made

written    representations         to    Masons    at    the    Grand       Lodge    annual

meeting    in    October    2003    that    the    program       was    a    success       and

provided a $10,000 benefit, but again omitted any reference to

the   $25,000        policies      for    which        the     Grand      Lodge      was    a

beneficiary.          Finally,     several       members       of   the      Grand    Lodge

executive committee testified that they were unaware that the

Grand Lodge was a beneficiary on issued $25,000 policies.

      Moreover, even if we were to accept the district court’s

view that the Defendants’ failure to discuss the details of the

proposed $25,000 policy program at the May 25 meeting was not a

material omission of fact because such a program had not yet

been finalized, the government presented other evidence that a

                                           18
rational jury could have accepted as sufficient to convict on

the mail fraud counts.           In particular, the district court failed

to credit the government’s evidence tending to show that the

Defendants directed ALGA agents to omit the face amount of the

policy    and    the    identity      of    the    beneficiary      on   applications

submitted      by    Masons,    and   that,       at   least   in   some      instances,

policies were issued that insured Masons for $25,000 and named

the Grand Lodge as a partial beneficiary without the knowledge

of the insured.

       The Defendants posit an innocent explanation for this state

of affairs, contending that the face amount of the policy could

not be established at the time of the application, because the

ultimate amount of coverage depended on underwriting variables

related to each insured.              That explanation, however, does not

fully address the government’s contention that Masons were never

told    that    they    could    be   approved         for   $25,000     in    insurance

coverage, or that a portion of that coverage would inure to the

benefit of the Grand Lodge.                Regardless, in apparently crediting

the    Defendants’      explanations        for   their      actions,    the    district

court failed to recognize that the jury was free to assess the

evidence       and     to   resolve        any    contradictions         against     the

Defendants.

                                            19
       As for the certificates of insurance that the Defendants

prepared, signed, and mailed to individual Masons, a rational

jury could have concluded that they were created for deceptive

purposes, contrary to the district court’s conclusion and the

Defendants’ argument on appeal.                  As we have already noted, the

certificates were inaccurate in key respects, insofar as they

omitted the face amount of the policies for those Masons who had

been insured for $25,000 and did not reflect that the Grand

Lodge    was     a     beneficiary    of    those      policies.          We   are    also

satisfied       that     a   rational      jury      could     conclude    that      these

omissions       were     material.      Indeed,        the     government      presented

testimony from a number of Masons that they never intended to

purchase $25,000 policies that would benefit the Grand Lodge and

that the certificates misled them about the true nature of the

transactions.

       The district court also concluded that the Riders signed by

each    Mason    sufficiently        alerted      those   applying    for      insurance

that they might qualify for a $25,000 policy.                       But while it is

true    that    each     Rider   included        a   generic    statement      that    the

minimum face amount of the policy to which it could be attached

was $25,000, the evidence also showed that (1) the Riders were

attached to all applications, only some of which resulted in the

issuance of $25,000 policies, and (2) the Riders did not alert

                                            20
Masons that the Grand Lodge would be a beneficiary on at least

some    of    the    policies.          Thus,      a   rational       jury    could     have

concluded that the Riders did not provide the type of notice

that the district court ascribed to them.

       The   district      court       also   determined       that    “the    Government

presented no evidence to support a jury finding that any of the

Defendants acted with the specific intent to defraud the Grand

Lodge and its members of something of value.”                          Id. 2860.        Here

again, we find the district court failed to give proper weight

to   the     government’s       evidence       tending    to    show     that     (1)      the

Defendants had reached an agreement in principle with American

Heritage--before          the    May    25,    2002    meeting--to        offer      Masons

$25,000 policies that would partially benefit the Grand Lodge;

(2) the Defendants’ agents intentionally procured the signatures

of Masons on insurance applications without including the face

amount of the policy or the identity of the Grand Lodge as a

beneficiary;        (3)   some     applications        were    processed        so    as   to

provide Masons who qualified with $25,000 in coverage and name

the Grand Lodge as a partial beneficiary without the insured’s

knowledge or consent; and (4) Masons within the Grand Lodge’s

leadership, as well as rank and file members, were unaware that

the program was issuing $25,000 policies that in part benefitted

the Grand Lodge.          Moreover, the government easily satisfied its

                                              21
burden to show that the Defendants wrongfully deprived the Grand

Lodge and its members of something of value in the form of the

premium payments tendered by these parties.

       In sum, viewing the evidence in the light most favorable to

the   government,            “a   reasonable        jury       could    conclude         that    the

defendants engaged in a scheme to defraud, and that they carried

it    out   by        use    of     the    mails,”       Godwin,       272       F.3d    at     667.

Accordingly,           we    reverse       the    district       court’s         grant    of     the

Defendants’ post-verdict motion for judgment of acquittal.

                                                 III.

       The government next asserts that the district court erred

in    conditionally           granting      a     new    trial.         Applying         the    more

deferential           standard      of    review       applicable      to    this       issue,    we

affirm.

       We review a district court’s grant of a new trial for abuse

of discretion.              Singh, 518 F.3d at 249.               The district court may

order a new trial if the evidence weighs so heavily against the

verdict     that       to    deny    a    new    trial     would       be   contrary       to    the

“interest        of    justice.”           See    Fed.    R.    Crim.       P.   33(a);       United

States      v.    Campbell,          977     F.2d       854,    860     (4th      Cir.        1992).

       Although the decision to grant a new trial lies within the

discretion of the district court, respect for the role of the

                                                  22
jury demands that a court exercise this discretion “sparingly,”

United States v. Smith, 451 F.3d 209, 217 (4th Cir. 2006), i.e.,

only when “the evidence weighs so heavily against the verdict

that it would be unjust to enter judgment.” United States v.

Arrington, 757 F.2d 1484, 1485 (4th Cir. 1985).                Nevertheless,

in contrast to the limitations imposed on a trial court when

considering a motion for judgment of acquittal, the court may

consider   the   credibility    of    witnesses   and   need   not   view   the

evidence   in    the   light   most   favorable    to   the    government   in

determining whether to grant a new trial.           Campbell, 977 F.2d at

860.

       At the outset, we reject the government’s contention that

the district court improperly granted a new trial for the same

reason it erroneously granted a judgment of acquittal: that the

evidence was insufficient to support the verdicts.               There is of

course a difference in degree and kind between a trial court’s

decision to grant a motion for judgment of acquittal and its

decision to award a new trial.             In assessing the former, the

trial court must find that the evidence was legally insufficient

to support the conviction (i.e., that no rational jury could

have voted to convict on the government’s evidence); as to the

latter, the trial court may grant relief if it determines that

the evidence--even if legally sufficient to convict--weighs so

                                      23
heavily against the verdict that it would be unjust to enter

judgment.     See id.

      As a result, our cases hold that if the evidence is legally

sufficient to affirm a criminal conviction, a trial court abuses

its discretion when, without further explanation, it grants “a

new   trial    based        on    its    finding          that     the    evidence      was

insufficient to support the verdict.”                       United States v. Wood,

340   F.   App’x    910,    911   (4th       Cir.    2009).        In    this   vein,   the

government argues here that “the same factors that the judge

considered    in    granting      the        judgment     of     acquittal      apparently

provided the basis for its grant of a new trial,” and thus “the

fundamental error that tainted the district court’s decision to

grant a judgment of acquittal also tainted its decision to grant

a new trial.”       Appellant’s Br. 56-57.

      Pressing its point further, the government analogizes the

instant case to Singh and United States v. Wilson, 118 F.3d 228

(4th Cir. 1997).           In Singh, however, we reversed a judgment of

acquittal     and    the     grant      of     a    new    trial    for     a    corporate

defendant, finding with respect to the latter that “the evidence

. . . did not at all weigh heavily against the verdict . . . but

was wholly sufficient to support it.”                       518 F.3d at 250.            The

district court’s error, we concluded, rested on its erroneous

determination that the criminal conduct of the defendant’s agent

                                              24
or employee could not be imputed to the defendant.                                Id. at 251.

This error, we held, tainted the district court’s analysis with

respect to the judgment of acquittal and the grant of a new

trial.      Id.        In this case, however, the district court did not

commit the type of foundational legal error that compelled us to

reverse in Singh.            Rather, “we interpret the district court’s

ruling as a finding that the verdict was against the cumulative

weight of the evidence[, which] is a proper ground upon which to

grant a new trial.”          Campbell, 977 F.2d at 860 n.6.

      In Wilson, we reversed a judgment of acquittal and affirmed

a denial of a motion for a new trial.                                 We held there that

because “abundant evidence support[ed] the jury’s verdict,” the

district court did not abuse its discretion in denying a motion

for a new trial based on the weight of the evidence.                                 118 F.3d

at   237.         Contrary      to    the       government’s         suggestion,     however,

Wilson   does      not    hold       that       a    trial   court    is   foreclosed      from

granting     a    motion     for      a    new       trial    in   every   case    where    the

evidence is legally sufficient to support a jury’s verdict.                                And

while Wilson teaches that “a district court should exercise its

discretion        to    grant    a        new       trial    ‘sparingly’    and     that   the

district court should grant a new trial based on the weight of

the evidence ‘only when the evidence weighs heavily against the

verdict,’ ” id., we evaluate such a ruling against the backdrop

                                                    25
of the district court’s “broad power” to independently weigh the

evidence    when      considering         such   a   motion,     as   well    as    the

deferential standard of review we must apply to that decision,

Arrington, 757 F.2d at 1485.

       Although the district court’s memorandum opinion could have

been clearer on the point, we are satisfied that the able and

experienced trial judge presiding over this case understood the

extent, and limits, of his discretion in considering the motion

for a new trial.           And while the trial court erred by drawing

inferences unfavorable to the government with respect to the

Defendants’     motion        for    acquittal,      it    was    under      no    such

constraint when considering whether the verdicts were against

the cumulative weight of the evidence.

       In that regard, the district court noted that only a few

hundred    of   the    over      18,000    members   of   the    Grand    Lodge    were

present at the May 25, 2002 meeting where, according to the

government, the Defendants first planted the seeds of deception

with respect to the supplemental insurance program.                      Indeed, the

vast   majority       of   the    Masons     received     information     about     the

program through regional and local lodge meetings held around

the state at which the Defendants were not present.

       Moreover, three Masons called by the government testified

that they understood the program offered $25,000 policies or

                                            26
that those policies had a split benefit provision where some

portion of the death benefit would be paid to the Grand Lodge.

The Defendants also called four additional Masons, who testified

that they too were aware of the $25,000 split benefit policies

and understood that the Grand Lodge would receive some portion

of the death benefit from the policies.                  On the strength of this

evidence,      the    district       court,     now     considering       the    record

pursuant to Rule 33, opined that the government’s “evidence with

regard to material omissions was based on the recollections of

Masons who attended meetings regarding the [insurance program],

some of whom testified to having knowledge of the very facts

that the Government contends the Defendants materially omitted

or concealed [from Grand Lodge members].”                 J.A. 2859-60.

      The     testimony      of     government        witness    James      Lightfoot

provides a      stark    example     of   the   confusion       endemic    among     the

Masons      regarding     the      specifics     of     the   insurance         program.

Lightfoot attended the May 25, 2002 meeting that the government

portrays as the genesis of the scheme to defraud.                          Lightfoot,

however, insisted at trial that Chambers told those present that

the program would include a split beneficiary arrangement to

partially benefit the Grand Lodge, but that Chambers backpedaled

on   this    aspect     of   the    program     after    several    Masons        voiced

objections.     Lightfoot did not recall, however, hearing Chambers

                                          27
tell     those       assembled    that    the     Grand       Lodge    would      own     the

policies.

       The government’s evidence at trial included a transcript of

the 25 May meeting, which was produced from an audio recording.

Tellingly, the transcript does not corroborate Lightfoot’s view

as     to    what     Chambers    purportedly          said    regarding       the      split

beneficiary arrangement, although it confirms what Chambers said

(and Lightfoot could not remember) about the ownership of the

policies.        Our point here is this:               We cannot say the district

court       abused    its    discretion    when--in       considering         whether     the

verdicts were against the cumulative weight of the evidence--it

questioned precisely what Masons were told, or remembered some

six years later, regarding the particulars of the supplemental

insurance program.

       The district court also placed great weight on the Riders

attached       to     each    insurance     application,          which     contained       a

declaration that the minimum face amount of the policy to which

they may be attached was $25,000.                 The district court found that

the     Riders       supported    the     view    “that       there     was     widespread

knowledge among the members of the Grand Lodge’s offering of

$25,000 policies.”            Id. 2836.     While the district court erred in

drawing       such     an    inference    on     the     motion       for     judgment     of

                                            28
acquittal, it was entitled to weigh this evidence as it saw fit

when determining whether to grant a new trial.

        Further,      the   record     is   unclear        as    to     precisely       which

policies       were    available       to   Masons,        as     opposed        to    merely

contemplated or agreed upon in principle, at the time of the May

25,    2002    meeting.        The     district      court       concluded       that       only

$10,000 policies were available for issuance at that time and

thus the Defendants could not have misrepresented any facts at

the May 25 meeting related to $25,000 policies that had not yet

been     approved.          Here   again,     we     can     discern        no    abuse       of

discretion in such a determination by the district court.

        The    district      court     further      accepted          as    credible         the

Defendants’        explanation     that     agents    were       instructed       to        leave

blank the “amount of insurance” field on a Mason’s application

because the underwriters could determine the actual amount of

coverage only upon review of a completed application.                             Regarding

the certificates of insurance issued by the Grand Lodge that the

government argued served to perpetuate the fraud, the district

court     concluded     instead      that    Chambers           and    Elliott        did    not

specifically intend to defraud their fellow Masons, but rather

asked ALGA to help them respond to the requests of individual

Masons by creating a document that would “serve as proof to the

members       of   their     death’s      benefit     [sic]”          and   “reflect         the

                                            29
relationship        between     the      Grand      Lodge    and   its    members.”       Id.

2839.        In    that    regard,       the   district       court      found   “that    the

information         contained       in    the       certificates         is   correct     and

accurately represents the information that had been conveyed to

the      members”       regarding     the      Grand    Lodge’s       ownership      of   the

policies,         the     Mason’s     $10,000        death     benefit,       the    Mason’s

designated beneficiary, and the Mason’s monthly premiums.                                 Id.

2839-40.            The    government          understandably         infers        something

entirely different from this evidence, but it bears repeating

that on a motion for a new trial, it is the district court’s

prerogative to draw its own inferences, Campbell, 972 F.2d at

860. 6

         Finally, Chambers and Souder testified at trial and denied

any intent to conceal the particulars of the insurance program

or to defraud the Grand Lodge or its members.                                 Rather, they

contended their intent, even if poorly executed, was “to create

an insurance program that would inure to the benefit, and not

         6
       The government criticizes the district court for not
providing a point-by-point rebuttal of its evidence regarding
the alleged scheme or artifice to defraud.    Perhaps so, but we
are unaware of any law requiring the level of detail that the
government insists on. We are satisfied that the district court
gave sufficient and careful consideration to all of the evidence
in this case before determining that the verdicts were against
the greater weight of that evidence.

                                               30
the deprivation, of the Grand Lodge and its members.”                            J.A.

2843.     Although not an express point of emphasis in the district

court’s memorandum opinion, it seems clear that the district

court chose to credit the Defendants’ innocent explanations for

their actions over the sinister interpretation posited by the

government.       And while the government would wish it otherwise,

it is precisely this kind of credibility determination that is

the trial court’s call to make on a motion for a new trial.

        At bottom, in urging reversal of the district court as to

this issue, the government would have us ignore the standard we

are bound to apply on appeal.                   While reasonable judges might

view this record differently if allowed to consider it in the

first instance, and we have nothing but the utmost respect for

the jury that considered this difficult matter over thirteen

days,     we   cannot    say     that     the    district      court   abused       its

discretion      in    holding    that    the     evidence   weighed    so    heavily

against the verdicts so as to warrant a new trial.                        See, e.g.,

Evans v. Eaton Corp. Long Term Disability Plan, 514 F.3d 315,

322    (4th    Cir.   2008)     (“At    its    immovable    core,   the     abuse    of

discretion standard requires a reviewing court to show enough

deference to a primary decision-maker’s judgment that the court

does    not    reverse    merely       because    it   would    have   come     to   a

different result in the first instance.”).

                                          31
                               IV.

     For the foregoing reasons, we reverse the district court’s

judgment of acquittal, affirm the conditional grant of a new

trial, and remand to the district court for further proceedings.

                                                AFFIRMED IN PART,
                                                REVERSED IN PART,
                                                     AND REMANDED

                               32