United States v. Boutte ( 1994 )

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 93-4128
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
GREGORY BOUTTE,
Defendant-Appellant.
Appeal from the United States District Court
for the Eastern District of Texas
(January 27, 1994)
Before VAN GRAAFEILAND,* SMITH and WIENER, Circuit Judges.
VAN GRAAFEILAND, Circuit Judge:
Gregory Boutte appeals from a judgment convicting him on five
counts of wire fraud (18 U.S.C. § 1343), five counts of submitting
false claims to a federal agency (18 U.S.C. § 287) and thirteen
counts of making false statements to a federal agency (18 U.S.C.
§ 1001). Boutte contends that the district court committed
reversible error in denying certain pretrial motions, making an
improper evidentiary ruling and giving defective instructions to the
*
Circuit Judge of the Second Circuit, sitting by designation.
jury. He also argues that the district court erroneously calculated
his sentence. Finding no merit in these contentions, we affirm.
During government fiscal years 1988 through 1991, Boutte and his
accounting partnership, Boutte, Elmore & Company, operated the
Triplex Minority Business Development Center. Triplex was one of a
number of development centers funded by the United States Department
of Commerce for the purpose of promoting the growth of minority-owned
businesses. The Department of Commerce awarded Triplex funding of
$165,000 for each fiscal year. To establish that Triplex continued
to meet the goals of the program, Boutte and the partnership were
required to submit quarterly narrative reports ("QNRs") to the
Department. The QNRs summarized the level of contract opportunities
or financing that minority businesses had received with the
assistance of Triplex. They also identified the partnership
personnel assigned to Triplex and the percentage of time these
employees devoted to Triplex matters. Triplex's failure to report a
sufficient amount of services provided to minority businesses could
jeopardize the continued federal funding of the center.
The Triplex QNRs from 1988 through 1991 stated that Triplex
rendered assistance on numerous occasions to W.B. Construction,
J. Allen Contractors and Family Construction. Indeed, these
businesses were the purported recipients of most of the assistance
Triplex reported during this period. The majority of the QNRs also
identified the partnership personnel assigned to Triplex and
indicated the percentage of each person's time allegedly devoted to
2
Triplex matters, the percentages varying from 35 percent to
100 percent.
Employees of W.B. Construction, J. Allen Contractors, Family
Construction and other businesses testified that they never received
the bulk of the assistance reported in Triplex's QNRs. Moreover,
Boutte and other partnership employees solicited and received from
some of these businesses copies of construction contracts that were
entered into without the help of Triplex. Boutte also obtained
information about contracts and financing from records the
partnership maintained as regular accountant for certain businesses,
and Boutte fraudulently added these contracts and financing to the
QNRs to bolster Triplex's assistance statistics. In addition, both
clients and employees of Boutte, Elmore & Co. testified that
individuals assigned to work for Triplex devoted significantly less
of their time to Triplex matters than was reported in the QNRs.
Boutte attempted to disguise these discrepancies by creating two
different sets of timesheets --- one for Triplex and one for the
partnership.
After being fired, Agustus Bodah, a partnership employee who was
reported to have devoted 100 percent of his time to Triplex,
contacted Commerce officials to report the occurrence of fraudulent
activities. Federal agents then obtained a search warrant for the
Triplex offices and a storage warehouse, and seized voluminous
documents at both locations. On October 17, 1991, a 23-count
indictment was returned against Boutte, the partnership and several
employees. Boutte moved before trial for production of the search
3
warrant affidavit, for leave to file a suppression motion within a
reasonable time after receiving the affidavit, and for a bill of
particulars. The Government opposed these motions and requested that
the search warrant affidavit be reviewed in camera because it
disclosed the identity of a confidential informant.
The district judge denied all three motions. With regard to the
warrant affidavit, he said that he had reviewed it in camera and
found it more than sufficient to support the issuance of the warrant.
Defense counsel was given a copy of the affidavit during the trial.
However, it was not made part of the record, and we have no knowledge
of its contents except that we are given to understand that the
confidential informant was Bodah.
We must express some wonderment as to why the district court
deemed it necessary to protect the identity of the informant Bodah
and why the warrant affidavit could not have been redacted
sufficiently to remove Bodah's name. Having said this, we hasten to
add that Boutte has not disclosed any prejudice requiring reversal.
Boutte has had a copy of the warrant affidavit in his possession
since June 29, 1992, and he has not deemed it necessary to get it
before this Court. We assume that, if the affidavit was inadequate
or if any of its contents were prejudicial, Boutte would have made
certain that a copy of the affidavit was in our hands. We disagree
with Boutte's argument that simply "by thwarting the application of
the Federal Rules of Criminal Procedure, the trial court deprived the
appellant of due process of law under U.S. CONST. amend. V."
(Appellant's Brief 13) The Rules of Criminal Procedure per se are
4
not the equivalent of constitutional dogma. Boutte must show with
some specificity why the district court's ruling hampered him in his
defense. See United States v. Diaz, 655 F.2d 580, 585-89 (5th Cir.
1981); United States v. Hare, 589 F.2d 242, 243 (5th Cir. 1979); see
also United States v. Mueller, 902 F.2d 336, 341 (5th Cir. 1991).
Boutte's argument that the district court's rulings deprived him
of his Sixth Amendment right to the benefit of counsel contains no
citation of supporting authority, and, of course, there is none.
The district court did not abuse its discretion in denying
Boutte's motion for a bill of particulars. Boutte requested the
identification of an individual whose working hours were at issue in
counts 1-5, and who was described only as a Triplex "business
specialist." Boutte also sought identification of the "various
clients" who, according to counts 11-23 of the indictment, did not
receive the services reported in Triplex's QNRs. The information
Boutte sought was available to him in the QNRs he submitted to the
Department of Commerce, and he failed to establish that the district
court's ruling resulted in "`actual surprise at trial and . . .
prejudice to his substantial rights.'" United States v. Moody, 923
F.2d 341, 351 (5th Cir.) (quoting United States v. Marrero, 904 F.2d
251, 258 (5th Cir.), cert. denied, 498 U.S. 1000 (1990)), cert.
denied, 112 S. Ct. 80 (1991); see United States v. Diecidue, 603 F.2d
535, 563 (5th Cir. 1979), cert. denied, 445 U.S. 946 (1980).
Boutte also contends that the district judge erred in
instructing the jury on the concept of deliberate ignorance.
Although Boutte does not challenge the correctness of the instruction
5
as an abstract statement of the law, he asserts that the evidence
below did not support the instruction because it created no inference
that he purposely contrived to avoid becoming aware that the QNRs
contained incorrect and deceptive statements.
A deliberate ignorance instruction must not be simply an
abstract statement of the law; it must state the legal principles as
they might be applied to the facts of the case being tried. United
States v. Cartwright, 6 F.3d 294, 300 (5th Cir. 1993). There is
nothing to indicate that Boutte consciously avoided becoming aware of
the fraudulent activities related to Triplex. Rather, the evidence
shows that Boutte took steps to become actively involved in the
illegal conduct. For example, he personally solicited copies of
contracts from certain construction firms for deceptive inclusion in
the QNRs; he personally assigned Triplex personnel to perform work
for the partnership that was charged to Triplex; he instructed
Triplex personnel to prepare two sets of time sheets in order to
disguise their partnership work, and he personally reviewed these
dual time sheets. His claim that he did not believe his acts were
wrongful does not demonstrate that he took steps to avoid learning of
the illegal conduct at the time of its commission. See United States
v. Lara-Velasquez, 919 F.2d 946, 951 (5th Cir. 1990).
To the extent that the district court's charge was error,
however, the error was harmless. In Cartwright, supra, this Court
held that, where there is no evidence of conscious ignorance, a
deliberate ignorance instruction "is `surplusage' and thus does `not
create the risk of prejudice.'" 6 F.3d at 301 (quoting United States
6
v. Samuel, 980 F.2d 1443 (5th Cir. 1992) (unpublished), cert. denied,
113 S. Ct. 2967 (1993)). Giving an instruction on deliberate
ignorance also constitutes harmless error where substantial evidence
of actual knowledge exists. See id.; United States v. Rivera, 944
F.2d 1563, 1572-73 (11th Cir. 1991).
We find no merit in Boutte's contention that with respect to the
misrepresentations alleged in counts 6-10 of the indictment, the
district court's charge omitted the allegations in the indictment
specific to his case. Although the district judge did not recite the
specific language of the indictment with respect to counts 6-10, he
did not permit the jury to convict Boutte "upon a factual basis that
effectively modifies an essential element of the offense charged."
United States v. Doucet, 994 F.2d 169, 172 (5th Cir. 1993). The
district judge properly set forth the elements of the offense
described in 18 U.S.C. § 287 and correctly paraphrased the language
of that section. He predicated conviction upon a factual basis that
satisfied the essential elements of section 287. Moreover, there was
little or no variance between the allegations of counts 6-10 and the
evidence introduced at trial. Thus, no uncertainty exists as to
whether the jury convicted Boutte for an offense not charged in the
indictment. See United States v. Young, 730 F.2d 221, 223-24 (5th
Cir. 1984).
We also reject Boutte's contention that the district court erred
in failing to instruct the jury adequately on unanimity with respect
to counts 6-10 and counts 11-23. With respect to counts 6-10, the
7
district judge instructed the jury solely with respect to the filing
of improper claims, not QNRs:
For you to find any defendant guilty of this crime you
must be convinced that the government has proved each of
the following beyond a reasonable doubt. First, that such
defendant knowingly presented to an agency of the United
State a false or fraudulent claim against the United
States, and second, that such defendant knew that the claim
was false or fraudulent.
These claims, entitled "Request for Funds," were admitted into
evidence as exhibits 64-68; they are the specific claims set forth
and identified in the indictment. Boutte is wrong, clearly wrong, in
his contention that under the court's charge the jury could have
convicted him on counts 6-10 of either making false claims for
payment or filing false QNRs. Moreover, the fact that the jury might
have based its finding of guilt based upon either the falsity or
fraudulence of the filed claims did not vitiate the verdict. See
Turner v. United States, 396 U.S. 398, 420 (1970); Smith v. United
States, 234 F.2d 385, 389 (5th Cir. 1956); Heflin v. United States,
223 F.2d 371, 373-74 (5th Cir. 1975); with specific reference to 18
U.S.C. § 287 see United States v. Murph, 707 F.2d 895, 896-97 (6th
Cir.), cert. denied, 464 U.S. 844 (1983); United States v. Maher, 582
F.2d 842, 846-47 (4th Cir. 1978), cert. denied, 439 U.S. 1115 (1979).
Boutte's further contention that, although the judge's charge
"included some general language requiring unanimity," it "did not
require the jury to be unanimous as to which of the two theories for
conviction, i.e., either `fraudulent' claims for payment or merely
`false' quarterly reports, supported a guilty verdict in Counts 6
through 10" (Appellant's Brief 32) simply repeats appellant's
8
misinterpretation of the court's charge already discussed in the
preceding paragraphs.
Counts 11-23, on the other hand, deal clearly with the making of
false and fraudulent QNRs, each count referencing a specific, dated
report. The district court instructed the jurors that their verdict
must be unanimous on each count. No request for a more detailed
instruction on unanimity was made, and the suggestions for greater
specificity contained in appellant's brief, e.g., the jury must
"unanimously agree on the factual basis," are meritless.
Boutte next asserts that the district court erred in allowing
the reading in evidence of the letter which Bodah wrote to the
Department of Commerce to initiate the Government's investigation of
Boutte's activities. The letter was not used to refresh Bodah's
recollection. Neither was it offered as a prior consistent
statement. Instead, it was offered as a lead-in or guide for Bodah's
oral testimony. Its use in this manner was improper. However,
Boutte's counsel did not object to this use of the letter, and the
error in its use was not so "fundamental as to have resulted in a
miscarriage of justice." United States v. Garcia, 995 F.2d 556, 561
(5th Cir. 1993) (per curiam); Ettelson v. Metropolitan Life Ins. Co.,
164 F.2d 660, 667 (3d Cir. 1947); Buckley v. United States, 33 F.2d
713, 717 (6th Cir. 1929). Its contents were largely cumulative to
the extensive testimony of numerous witnesses, including Bodah
himself.
Boutte's final contention is that the district court erred in
increasing his Guideline-controlled sentence by four levels for his
9
role in the offense as an organizer or leader. Boutte asserts that
the criminal activity for which he was convicted did not involve five
or more participants within the meaning of the Guidelines. However,
the district court did not clearly err in finding by a preponderance
of the evidence that the Guideline requirement was satisfied. See
generally United States v. Mergerson, 4 F.3d 337, 347 (5th Cir.
1993). In addition to Boutte himself, see United States v.
Barbontin, 907 F.2d 1494, 1498 (5th Cir. 1990), the evidence
presented at trial indicated that at least four other employees
participated in the fraudulent activities leading to Boutte's
conviction. Contrary to Boutte's assertions, these individuals need
not have been charged or convicted with him in order to count as
participants in the criminal activity; they need only have
participated knowingly in some part of the criminal enterprise. See
United States v. Alfaro, 919 F.2d 962, 967 (5th Cir. 1990); U.S.S.G.
§ 3B1.1, comment. (n.1). Boutte has failed to demonstrate that these
Triplex employees did not knowingly play a role in the fraudulent
activities and that the district court's finding of participation was
clearly erroneous.
The judgment of conviction is AFFIRMED.
10