United States v. Cohen, Karen D. , 209 F. App'x 576 ( 2006 )

UNPUBLISHED ORDER
Not to be cited per Circuit Rule 53
United States Court of Appeals
For the Seventh Circuit
Chicago, Illinois 60604
Argued November 6, 2006
Decided December 20, 2006
Before
Hon. KENNETH F. RIPPLE, Circuit Judge
Hon. ANN CLAIRE WILLIAMS, Circuit Judge
Hon. DIANE S. SYKES, Circuit Judge
No. 06-1503
UNITED STATES OF AMERICA, Appeal from the United States District
Plaintiff-Appellee, Court for the Central District of Illinois.
v. No. 05 CR 30002
KAREN D. COHEN, Jeanne E. Scott,
Defendant-Appellant. Judge.
ORDER
Karen D. Cohen was convicted by a jury of committing perjury in violation of 18
U.S.C. § 152(3) based on statements she made before the United States Bankruptcy
Court in December 2000. Cohen contends that her conviction should be overturned
because the questions posed to her during the bankruptcy proceedings were
fundamentally ambiguous. Because we conclude that the questions were not
ambiguous, let alone, fundamentally ambiguous, we affirm her conviction.
I. BACKGROUND
In 1982, Cohen won a million dollar lottery prize from the Illinois State Lottery
(“Lottery”), which was to be paid in twenty annual installments of $34,500 (after taxes)
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ending in 2001. At the time Cohen won the lottery, she was married to Steven Shanle.
They divorced the following year, and as part of their divorce settlement, Cohen agreed
to pay Shanle $9000 annually until 2001 to resolve the dispute over whether the lottery
prize was marital or non-marital property. Until 1996, Shanle received his annual
payments from Cohen as arranged.
In January 1997, Cohen took out a $60,000 loan, which she agreed to repay in
four $25,500 annual installments. Pursuant to the terms of the loan agreement, Cohen
opened a bank account in which the Lottery would deposit annual lottery payments
and gave her lender sole authority to withdraw funds from the account. The
agreement also acknowledged Shanle’s right to receive $9000 of the lottery winnings
each year, but did not provide the lender with the authority to send any money directly
to Shanle. Instead, the lender agreed to pay Cohen $9000 as a yearly installment so
that she might fulfill her obligation to Shanle.
Later that year, the Lottery deposited an annual lottery payment into the bank
account. The lender collected its share and distributed the $9000 balance to Cohen.
One month later, Cohen sent a $9000 check to Shanle. This was the last lottery
payment that Cohen made to Shanle.
In 1998, the lender again collected its share of the annual lottery payment and
sent Cohen a check for $9000. Cohen deposited the check in June 1998, but, as she
indicated at her perjury trial, she failed to forward those funds to Shanle. Shanle
thereafter obtained a court order holding Cohen in contempt in part for failing to
provide him with his portion of the 1998 lottery winnings. The court ordered Cohen
to pay Shanle the $9000 payments due in 1998 and 1999. Those funds were garnished
from Cohen’s 1999 lottery payment.
Since the 1999 lottery funds had been garnished, Cohen’s lender did not receive
any payment on Cohen’s loan in 1999, resulting in the default of the loan. The lender
therefore filed a garnishment action against the Lottery, and the Lottery was ordered
to pay Cohen’s lender the approximately $70,000 due on the loan out of the remaining
lottery proceeds.
Cohen filed for bankruptcy in July 2000 and sought to discharge, among other
debts, her obligation to pay Shanle the $9000 payments for 2000 and 2001. Shanle
filed an objection to the discharge, claiming that Cohen had embezzled his portion of
the lottery winnings.
At the bankruptcy proceeding, Cohen answered questions posed by Shanle’s
lawyer about whether she had received Shanle’s portion of the lottery winnings. After
the court established that Cohen assigned her rights to the lottery proceeds to her
lender, the following exchange ensued between Shanle’s attorney and Cohen:
Q. And when you did that [assigned rights to the lottery proceeds], you sold
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not only your right to the $37,500 or whatever it was after taxes, but you
also sold Mr. Shanle’s $9,000?
A. No, no, there was an agreement in that I did not receive his $9,000, that
it would be kept back and he would receive it every year. I did not get
that money, no.
...
Q. And you didn’t pay to [Shanle] his $9,000?
A. Because they were to pay it.
Q. You didn’t pay the $9,000, correct?
A. I didn’t get it. They gave –
Q. So your answer is that you did not, correct?
A. I didn’t pay it. I didn’t have it.
App. at 30-31. Based on Cohen’s representations that she thought her lender, and
not she, was obligated to make payments to Shanle, the bankruptcy court
discharged the $18,000 she owed to Shanle.
After discharging Cohen’s debt, the bankruptcy judge directed that an
investigation be undertaken to determine whether Cohen’s lender had possession of
any lottery proceeds due to Shanle. During the course of the investigation, the lender
produced copies of cancelled checks for $9000, which had been issued to Cohen in 1997
and 1998. Subsequently, Federal Bureau of Investigation (FBI) agents interviewed
Cohen at her home. During the interview, Cohen again stated that it was her lender’s
responsibility to pay Shanle his $9000 portion of the lottery winnings on an annual
basis. When Cohen was shown the 1997 and 1998 cancelled checks, she confirmed
that she had endorsed the checks, but denied ever receiving them. She explained that
the checks may have been pre-signed at the time she obtained the loan. Following the
FBI investigation, Cohen was indicted for perjury.
At her perjury trial, Cohen offered an explanation for her testimony before the
bankruptcy court. She stated that when she testified at the bankruptcy proceeding
that she did not receive Shanle’s money, she meant that she did not receive Shanle’s
money at the time that she obtained the loan in 1997. She claimed her answers were
not false because she believed Shanle’s attorney was asking about whether she had
failed to pay Shanle $9000 out of her initial loan of $60,000. She testified that her
answer “because they were to pay it” meant that she did not pay the $9000 at the time
she received the loan because her lender was going to pay her the $9000 at a later
date. Cohen also acknowledged that she was interviewed by FBI agents regarding the
two checks, and said that she thought the agents were questioning her about the
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checks for 2000 and 2001. Disbelieving Cohen, the jury returned a guilty verdict.
II. ANALYSIS
In reviewing a defendant’s sufficiency of the evidence challenge, we view all
evidence in the light most favorable to the government. United States v. Olson, 450
F.3d 655, 664 (7th Cir. 2006). We will only reverse the conviction if we conclude that
no rational trier of fact could have found the defendant guilty of the charges beyond
a reasonable doubt. Id.Cohen contends that there was insufficient evidence to support her perjury
conviction because the government did not prove that she made a “false declaration.”
See 18 U.S.C. § 152(3) (Any person who “knowingly and fraudulently makes a false
declaration . . . under penalty of perjury” during a bankruptcy proceeding is guilty of
perjury). She asserts that the questions posed to her during the bankruptcy
proceeding were “fundamentally ambiguous,” (and therefore inappropriate for
submission to a jury) because Shanle’s attorney did not refer to a specific year when
he questioned her about whether she had received Shanle’s lottery proceeds.
The Seventh Circuit has held that when a question and answer may have “more
than one meaning standing alone, their intended meaning is ordinarily” a jury issue,
but where there is a “fundamental ambiguity,” the issue must be taken from the jury.
United States v. Martellano, 675 F.2d 940, 942 (7th Cir. 1982). This court has yet to
squarely define what constitutes a fundamentally ambiguous question, and we need
not do so here. When we consider the questions asked of Cohen in context, as we
must, the questions are neither ambiguous, nor fundamentally so. See Martellano,
675 F.2d at 943 (“The context of the question and answer is often of critical
importance if it is claimed the question was ambiguous or was misunderstood as it is
in this case.”).
Although Cohen claims that she was hopelessly confused by Shanle’s attorney’s
questions, it is clear that Shanle’s attorney was referring to Cohen’s obligation to pay
Shanle in 1998. As the government noted at oral argument, the questions posed to
Cohen could only relate to the years following her receipt of the loan–1997, 1998,
1999, 2000, 2001. Given that the bankruptcy proceeding occurred in 2000, Shanle’s
attorney could not have been accusing Cohen of failing to pay the 2001 debt, which
was not yet due. Nor could Shanle’s attorney have been referring to the 2000 or 1999
checks, which were garnished by her lender and Shanle, respectively. Since Cohen
paid Shanle his $9000 in 1997, only the 1998 check could have been at issue.
Nonetheless, if we assume that Cohen was somehow confused by Shanle’s
attorney’s questions, we note that she offered the same responses to the bankruptcy
judge’s subsequent questions of unmistakable clarity:
Q. Okay. So in the documents that you signed with them [the lender], it
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authorized them to cash the [lottery] check.
A. Right.
Q. And you indicate that it was your understanding with whoever that
$9,000 was to be withheld to be paid to Mr. Shanle.
Q. That’s correct.
A. Who was to withhold that money, the Lottery or [the lender]?
Q. I was under the impression that [the lender] was to do that.
A. Okay. So that when they got the check, they were to take out 9,000 for
Mr. Shanle and then the balance went to them?
Q. Right.
App. at 33-34. Without question, then, Cohen intended to represent to the bankruptcy
court that the obligation to make the annual $9000 payments to Shanle always rested
with the lender. Despite her contrary representation, the jury could have found that
Cohen knew that she, in fact, had the obligation to pay Shanle his annual lottery
payment. Indeed, Cohen admits that in 1997 she deposited a $9000 check received
from her lender and turned that sum over to Shanle.
Finally, that Cohen boldly denied having received two $9000 checks bearing her
endorsement (dated in 1997 and 1998) from the lender suggests a pattern of deception
and cuts against any argument that her prior false testimony was unintentional or the
result of misunderstanding. The jury was certainly at liberty to conclude that Cohen
intentionally made a false declaration during the course of the bankruptcy
proceedings.
The judgment of the district court is therefore AFFIRMED.