United States v. Hogue ( 1998 )

REVISED, JANUARY 28, 1998
UNITED STATES COURT OF APPEALS
For the Fifth Circuit
No. 96-11378
UNITED STATES OF AMERICA,
Plaintiff-Appellee
VERSUS
KENNY HOGUE and JESSE MEEKS,
Defendants-Appellants.
Appeals from the United States District Court
for the Northern District of Texas
Dallas Division
__________________________________________________
January 12, 1998
Before DeMOSS and DENNIS, Circuit Judges, and LEE*, District Judge.
DENNIS, Circuit Judge:
This is the second appeal involving the prosecution of Jesse
B. Meeks (“Meeks”) and Kenny Ray Hogue (“Hogue”)on an indictment
under 18 U.S.C. § 656 for the misappropriation of Krugerrands from
safe deposit boxes in the vault of First Republic Bank Dallas, N.A.
(the “Bank”). At the time of their alleged offenses, Meeks and
*
District Judge of the Southern District of Mississippi,
sitting by designation.
Hogue were engaged in their employment as locksmiths by Underwood
Safe and Vault Service (“Underwood Safe”), which had contracted
with the Bank to provide locksmith services to the Bank for the
repair and maintenance of its safe deposit boxes. In the first
case, the district court dismissed the indictment on grounds that,
under the facts stipulated to by the parties, the defendants were
not amenable to conviction because they were not “connected in any
capacity” with the Bank as required by the statute. Upon the
government’s appeal, this court reversed, holding that the district
court incorrectly construed the statute by reading into it the
requirement that the offender must have occupied a position of
trust with the bank at the time of the offense. United States v.
Meeks, 69 F.3d 742, 743 (5th Cir. 1995), cert. denied, __ U.S. __,
116 S. Ct. 1337 (1996) (“Meeks I”). On remand, after a bench trial,
the district court convicted Meeks and Hogue, stating that it was
compelled by this court’s decision in Meeks I to find that they
were connected in a capacity with the Bank at the time of the
offenses. Meeks and Hogue appealed. Because we cannot determine
from the present record whether the district court found beyond a
reasonable doubt that Meeks and Hogue were connected in any
capacity with the Bank at the time of the alleged offenses, we now
vacate the district court judgment and remand the case for further
proceedings.
FACTS
Meeks and Hogue were employees of Underwood Safe, an
independent contractor that contracted with the Bank to provide
2
locksmith services for the Bank’s safe deposit vault, which
included drilling safe deposit boxes that had been abandoned by
depositors and changing the locks and keys on safe deposit boxes.
The Bank required that all such locksmith work be monitored by bank
employees. Sometime in 1985, while Meeks was inside the vault
performing his locksmith duties, Ms. Maria del Carmen Garcia-
Rendueles de Roberdo (“Rendueles”), the lessee of several safe
deposit boxes, asked Meeks to help her remove a box. While Meeks
was assisting Rendueles, he discovered that the box contained
Krugerrand coins that were being transferred into two other boxes
leased by Rendueles or her company.
Meeks reported the existence of the Krugerrands to his
employer, Erwin Underwood (“Underwood”), the owner of Underwood
Safe. At Underwood’s urging, Meeks agreed to force open Rendueles’
safe deposit boxes, take the Krugerrands, and split the coins
between them. Hogue, who was also employed by Underwood Vault,
agreed, in exchange for receiving a share of the stolen property,
to assist in the theft and act as a lookout during the crime.
Sometime between 1985 and 1987, Meeks and Hogue removed all of the
Krugerrands from two of the three boxes by forcibly prying open the
door hinges of the boxes with a metal tool.
In 1994, seven years after the theft of the coins was
discovered, Meeks and Hogue were indicted under 18 U.S.C. § 656.1
At the time of the offenses, Section 656 provided that “[w]hoever,
1
Despite the evidence of his involvement, Erwin Underwood was
not indicted.
3
being an officer, director, agent or employee of, or connected in
any capacity with” certain banks or institutions, who embezzles,
abstracts, purloins, or willfully misapplies certain assets
belonging or entrusted to the banks or institutions, shall be fined
or imprisoned, or both. 18 U.S.C. § 656 (1976).2
In the indictment, the appellants were charged with violations
of 18 U.S.C. § 656 while acting as “employees of Underwood Safe and
Vault Company, a contractor connected with First Republic Bank.”
The appellants moved to dismiss the indictment on the ground that
it failed to state an offense because it did not allege facts
sufficient to establish that appellants were “connected in any
capacity with” the Bank, as required by 18 U.S.C. § 656.
Ordinarily, a motion to dismiss an indictment for failure to
state an offense challenges the sufficiency of the indictment
itself, requiring the court to take the allegations of the
indictment as true and to determine whether an offense has been
stated. United States v. Cadillac Overall Supply Co., 568 F.2d
1078, 1082 (5th Cir.), cert. denied, 437 U.S. 903 (1978). If the
district court dismisses an indictment because it does not allege
an offense, on review the indictment is to be tested not by whether
its allegations are in fact true but by the indictment’s
“sufficiency to charge an offense.” United States v. Mann, 517
F.2d 259, 266 (5th Cir. 1975) (quoting United States v. Sampson,
2
The alleged criminal activities of Meeks and Hogue occurred
between 1985 and 1987, before the 1989, 1990 and 1994 amendments to
§ 656.
4
371 U.S. 75, 78-79 (1962)), cert. denied, 423 U.S. 1087 (1976).
In Meeks I, however, neither the district court nor this court
of appeals based its decision strictly upon the facts recited in
the indictment. Because the Government and the defendants entered
into a joint stipulation of facts for purposes of the motion to
dismiss the indictment, each court considered the allegations of
the indictment as expanded by the stipulated facts. The district
court dismissed the indictment, concluding that the stipulated
facts showed that Meeks and Hogue were not “sufficiently ‘connected
in any capacity with’ a bank pursuant to § 656 [because Meeks and
Hogue did not] exercise some position of control over the bank’s
affairs, enjoy a relationship of trust with the bank, or [were]
entrusted with bank funds or property.” (Mem. Op. and Order at 7).
Upon the Government’s appeal in Meeks I, this court reversed,
holding that (1) § 656 does not require that the offender exercise
control over the bank’s affairs, occupy a position of trust with
the bank, or be entrusted with bank funds or property, in order to
be “connected in any capacity” with a bank under the statute; (2)
the words of the statute should be given their common, ordinary
meaning; and (3) under the facts alleged in the indictment and the
joint stipulation, it could not be said that no reasonable trier of
the facts could have found that Meeks and Hogue were “connected in
any capacity with” the Bank at the time of the charged offenses.
Meeks I, 69 F.3d 744-45.
On remand, after a bench trial, the district court convicted
Meeks and Hogue of violations of 18 U.S.C. § 656. Meeks and Hogue
5
filed the present appeal (Meeks II). In Meeks II, the major
controversies concern the meaning and effect of (1) this court’s
decision in Meeks I and (2) the district court’s findings of fact
and conclusions of law upon remand following Meeks I.
DISCUSSION
1.
When a person is charged with a crime, he is entitled to a
presumption of innocence and may insist that his guilt be
established beyond a reasonable doubt. Herrera v. Collins, 506
U.S. 390, 398 (1993); In re Winship, 397 U.S. 358, 364 (1970). As
a result, the prosecution bears the burden of proving all elements
of the offense charged and must persuade the fact finder beyond a
reasonable doubt of the facts necessary to establish each of those
elements. Sullivan v. Louisiana, 508 U.S. 275, 277-78 (1993); see
also Estelle v. McGuire, 502 U.S. 62, 69 (1991)(“[T]he prosecution
must prove all the elements of a criminal offense beyond a
reasonable doubt.”); United States v. Gaudin, 515 U.S. 506, 523
(1995)(Rehnquist, C.J., concurring). Therefore, a judge may not
direct a verdict of guilty no matter how conclusive the evidence.
United States v. Johnson, 718 F.2d 1317, 1321 (5th Cir. 1983) (en
banc) (citing Connecticut v. Johnson, 460 U.S. 73, 84 (1983)
(plurality opinion) (quoting United Bhd. of Carpenters & Joiners v.
United States, 330 U.S. 395, 408 (1947))). Accord Sullivan, 508
U.S. at 277.
The Winship doctrine requires that the fact finder will
rationally apply the fundamental substantive constitutional beyond-
6
a-reasonable-doubt standard to the facts in evidence. Jackson v.
Virginia, 443 U.S. 307, 316-17 (1979). Under Winship, the trier of
facts is bound by this duty whether it is a court or a jury. Id.
at 317 n.8.; see Winship, 397 U.S. at 360 (arising from a juvenile
adjudicatory hearing in which a state family court judge found that
the juvenile had committed an act which, if done by an adult, would
constitute larceny).
The fact finder in a criminal case traditionally has been
permitted to enter an unassailable but unreasonable verdict of “not
guilty.” This is the logical corollary of the rule that there can
be no appeal from a judgment of acquittal, even if the evidence is
overwhelming. Jackson, 443 U.S. at 318 n.10. The power of the
fact finder to err upon the side of mercy, however, has never been
thought to include a power to enter an unreasonable verdict of
guilty. Id. (citing Carpenters & Joiners, 330 U.S. at 408); cf.
Capital Traction Co. v. Hof, 174 U.S. 1, 13-14 (1899).
2.
At the time of the alleged offenses, 18 U.S.C. § 656, in
pertinent part, provided:
Whoever, being an officer, director, agent or employee
of, or connected in any capacity with any Federal
Reserve bank, member bank, national bank or insured bank.
. . embezzles, abstracts, purloins or willfully
misapplies any of the moneys, funds or credits of such
bank or any moneys, funds, assets or securities intrusted
to the custody or care of such bank. . . shall be fined
not more than $5,000 or imprisoned not more than five
years, or both. . . .
The essential elements of the crime Meeks and Hogue were
accused of are that they (1) were connected in a capacity with a
7
federally insured bank (2) when they embezzled, purloined or
willfully misapplied (3) moneys, funds, or assets (4) entrusted to
the custody or care of such bank. Accordingly, in the present
case, the district court, in the bench trial, was required to find
beyond a reasonable doubt, inter alia, that Meeks and Hogue were
connected in some capacity with the bank at the time the
Krugerrands were misappropriated, in order to convict them of
violating 18 U.S.C. § 656.
3.
Federal Rule of Criminal Procedure 23(c), in pertinent part,
provides: “In a case tried without a jury the court shall make a
general finding and shall in addition, on request made before the
general finding, find the facts specially. Such findings may be
oral.” Although the district court was not requested to do so, it
orally made special findings of facts as well as a general
finding.3 The purpose of special findings of facts is to afford a
reviewing court a clear understanding of the basis of the trial
court’s decision. United States v. Johnson, 496 F.2d 1131, 1138
n.7 (5th Cir. 1974) (citing Gulf King Shrimp Co. v. Wirtz, 407 F.2d
508, 515 (5th Cir. 1969); Featherstone v. Barash, 345 F.2d 246, 249
(10th Cir. 1965)), cert. denied, 420 U.S. 972 (1975). Certain of
the standards for determining whether a trial court’s findings of
fact are adequate are the same in civil and criminal cases. See
3
Some judges make findings in all criminal cases in which the
jury is waived, even though there has been no request from a party.
See 2 CHARLES A. WRIGHT, FEDERAL PRACTICE AND PROCEDURE § 374, at 311-12 &
n.5 (2d ed. 1982).
8
Johnson, 496 F.2d at 1138 n.7. “‘The ultimate test as to the
adequacy of findings will always be whether they are sufficiently
comprehensive and pertinent to the issues to provide a basis for
decision.’” Id. (quoting Gulf King Shrimp Co., 407 F.2d at 515
(quoting Carr v. Yokohama Specie Bank, Ltd., 200 F.2d 251, 255 (9th
Cir. 1952))). “‘Findings may be sufficient if they permit a clear
understanding of the basis of decision of the trial court,
irrespective of their mere form of arrangement.’” Id. (quoting
Featherstone, 345 F.2d at 250).
Applying these standards, we conclude that the district
court’s oral findings are inadequate because they do not permit a
clear understanding of whether its decision was based on its own
finding beyond a reasonable doubt that Meeks and Hogue were persons
“connected in any capacity” with the Bank or, rather, upon its
erroneous conclusion that it was bound by a finding to this effect
contained in the Meeks I appellate opinion. The district court’s
oral findings are susceptible to either interpretation and
therefore create grave doubt as to whether the defendants were
convicted without the trier of the facts having found the existence
of every essential element of the crime charged beyond a reasonable
doubt. See Haywood v. United States, 393 F.2d 780, 782 (5th Cir.
1968).
We therefore remand this case to the district court to conduct
proceedings as to this question and to make written findings of
fact supportive of its ultimate conclusion. Should the district
court find beyond a reasonable doubt that Meeks and Hogue were
9
persons connected in any capacity with the Bank at the time of the
charged offenses, the convictions and sentences should be
sustained. On the other hand, if the district court finds that
proof of this essential element of the crime is not sufficient, the
charges should be dismissed.
4.
The Government argues that the convictions and sentences
should be affirmed because this court in Meeks I held as a matter
of law that employees of an independent contractor that contracted
to repair and maintain a bank’s safe deposit boxes are persons
“connected in any capacity” with the bank within the meaning of 18
U.S.C. § 656. In support of this argument, the Government quotes
two passages from the Meeks I opinion:
[T]he statute’s plain language provides no basis for a
narrow reading of its scope. The words “connected in any
capacity”, as normally used, comprise a broad modifying
phrase. Absent binding contrary precedent, we cannot
distort the usual meaning of the phrase to require a more
specialized type of connection with the bank than that
held by Meeks and Hogue.
The capacity in which Meeks and Hogue were connected
with the bank was as employees of an independent
contractor that provided the bank with a necessary
service, which required (and permitted) its employees to
be in a restricted area of the bank. Irrespective of the
outer limits of the statute’s reach, we cannot say that
these defendants fell beyond that reach when they
serviced the safe deposit boxes from within the vault of
the bank.
Meeks I, 69 F.3d at 744 (citation omitted).
The Government reads too much into these portions of the
opinion. Meeks I made these statements in explaining why it
rejected the interpretation of the statute that had been adopted by
the district court, viz., that “to be sufficiently ‘connected in
10
any capacity with’ a bank pursuant to § 656, the defendant must
exercise some position of control over the bank’s affairs, enjoy a
relationship of trust with the bank, or be entrusted with bank
funds or property.” Within this context, Meeks I rejected the
district court’s narrow interpretation of § 656 that read into the
statute the extra essential element that the defendant must have
occupied a position of trust or control with the Bank. Meeks I
also held that persons in Meeks’ and Hogue’s circumstances are not
immune from prosecution under § 656 simply because they are
employees of an independent contractor and not direct employees or
contractors of the Bank.
Meeks I does not hold, however, that as a matter of law the
employee of an independent contractor providing locksmith services
for the bank’s safety deposit boxes, regardless of the particular
circumstances of each case, is a person “connected in any capacity
with” the bank within the meaning of 18 U.S.C. § 656. The plain
words of the opinion do not purport to add extra words to the
statute or to read into its coverage specialized types of
connections. On the contrary, the Meeks I court admonished that
the words of the statute must be given their common, ordinary
meaning; and that an appellate court’s discussion of factors that
impacted its decision that a particular defendant is amenable to
prosecution under § 656 “does not mean that each of those factors
becomes, from that day forward, a necessary attribute of a person
whose conduct is reached by the statute.” Id. at 744-45.
Additionally, we decline to adopt the Government’s reading of
11
Meeks I because it would be tantamount to having this court do what
we and the Supreme Court have held that due process prohibits a
trial court from doing, i.e., directing a verdict for the
Government on, or otherwise withdrawing from the trier of the facts
the function of finding beyond a reasonable doubt, an essential
element of the crime charged. See Winship, 397 U.S. at 361, 363;
Gaudin, 515 U.S. at 522-23; Sullivan, 508 U.S. at 277-78; Johnson,
718 F.2d at 1321. That the trier of facts in this case was a judge
and not a jury “is of no constitutional significance.” See
Jackson, 443 U.S. at 317 n.8.
CONCLUSION
Accordingly, the judgment of the district court is VACATED,
and the case is REMANDED WITH INSTRUCTIONS.
ENDRECORD
12
DeMOSS, Circuit Judge, specially concurring:
I concur fully in the reasoning and disposition of the
foregoing opinion. I write separately to identify another problem
which the district court should address on remand.
At the time of the criminal conduct made the subject of this
prosecution, the criminal statute in question expressly provided
that what was embezzled or wilfully misapplied must be "the monies,
funds or credits of such bank or any money, funds or credits
intrusted to the custody or care of such bank." 18 U.S.C. § 656
(1988), (current version at 18 U.S.C.A. § 656 (West Supp. 1997)).
There is absolutely nothing in the stipulation of facts filed by
the parties in this case which would indicate that the Krugerrands
in the safety deposit boxes leased by First RepublicBank Dallas,
N.A. (the "Bank") to Mrs. Roberdo or her company, La Madrid Corp.,
N.V., were the property of any person or entity other than Mrs.
Roberdo and her corporation. Consequently, absent some other
direct proof, it would seem clear to me that the Krugerrands were
not "the money, funds or credits ... of such bank." Likewise,
there is nothing in the stipulation of facts which would indicate
that the Krugerrands in the safety deposit box had been "intrusted
to the custody or care of such bank." To the contrary, the safety
deposit lease agreement appended as Exhibit A to the Stipulations
expressly exempts the Bank from any liability "for the safekeeping
of the contents of the safe or for any loss, damage, or expense
which results from or is caused by, in whole or in part, any of the
following: ... (iii) loss, disappearance ... theft, burglary,
embezzlement or other criminal act ...." Consequently, unless
there is other documentary evidence establishing an agreement on
the part of the Bank to be responsible for the Krugerrands in the
safety deposit box, it would appear to me that the Krugerrands were
never "intrusted to the custody or care of such bank." Therefore,
I think there is a serious question as to whether the statutory
requirements as to the Bank’s ownership or care and custody of the
Krugerrands have been established in this case; and the district
court should undertake to resolve this question upon remand.
14