State v. Oki ( 2020 )

NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER
Electronically Filed
Intermediate Court of Appeals
CAAP-XX-XXXXXXX
05-JUN-2020
07:58 AM
NO. CAAP-XX-XXXXXXX
IN THE INTERMEDIATE COURT OF APPEALS
OF THE STATE OF HAWAI#I
STATE OF HAWAI#I,
Plaintiff-Appellee/Cross-Appellant,
v.
PATRICK H. OKI,
Defendant-Appellant/Cross-Appellee
APPEAL FROM THE CIRCUIT COURT OF THE FIRST CIRCUIT
(CRIMINAL NO. 1PC151000488)
MEMORANDUM OPINION
(By: Leonard, Presiding Judge, Chan and Wadsworth, JJ.)
Defendant-Appellant/Cross-Appellee Patrick H. Oki (Oki)
appeals from the Amended Judgment of Conviction and Sentence
(Amended Judgment) and the Free-Standing Order of Restitution,
both filed on May 24, 2018, by the Circuit Court of the First
Circuit (circuit court).1 Plaintiff-Appellee/Cross-Appellant
State of Hawai#i (State) cross-appeals.
I. BACKGROUND
This case arises from incidents that occurred between
2011 and 2014, when Oki was managing partner of a local
1
The Honorable Colette Y. Garibaldi initially presided over the
matter until at least May 5, 2016. Although the record is unclear as to the
exact date, it appears the matter was then reassigned to the Honorable Paul B.K.
Wong. Judge Wong presided until his recusal on July 11, 2016. The Honorable
Rom A. Trader then presided over the remainder of the proceedings.
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accounting firm, PKF Pacific Hawaii, LLP (PKF).2 Over that time,
PKF's other former partners, Lawrence Chew (Chew), Deneen
Nakashima (Nakashima), Dwayne Takeno (Takeno), and Trisha Nomura
(Nomura), began to suspect, based on Oki's actions, that Oki had
devised and used four schemes to fraudulently obtain money from
PKF. The former partners reported the matter to the Honolulu
Police Department (HPD) on February 20, 2014. On April 1, 2015,
Oki was indicted by a grand jury and charged with: four counts of
Theft in the First Degree (Theft 1), in violation of Hawaii
Revised Statutes (HRS) §§ 708-830.5(1)(a)3 and 708-830(2)4; three
counts of Money Laundering, in violation of HRS § 708A-
3(1)(a)(ii)(A)5; two counts of Use of a Computer in the
2
PKF has since changed its name to Spire Hawaii, LLP (Spire).
3
HRS § 708-830.5 (2014) provides, in relevant part:
§708-830.5 Theft in the first degree. (1) A person
commits the offense of theft in the first degree if the person
commits theft:
(a) Of property or services, the value of which
exceeds $20,000;
. . . .
(2) Theft in the first degree is a class B felony.
4
HRS § 708-830 (2014) provides, in relevant part:
§708-830 Theft. A person commits theft if the person
does any of the following:
. . . .
(2) Property obtained or control exerted through
deception. A person obtains, or exerts control over, the
property of another by deception with intent to deprive the
other of the property.
5
HRS § 708A-3 (2014) provides, in relevant part:
§708A-3 Money laundering; criminal penalty. (1) It is
unlawful for any person:
(a) Who knows that the property involved is the
proceeds of some form of unlawful activity, to
knowingly transport, transmit, transfer, receive,
or acquire the property or to conduct a
transaction involving the property, when, in fact,
the property is the proceeds of specified unlawful
activity:
2
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Commission of a Separate Crime (Use of a Computer), in violation
of HRS § 708-893(1)(a)6; and four counts of Forgery in the Second
Degree (Forgery 2), in violation of HRS § 708-8527. The
Indictment charged as follows:
COUNT 1: On or about January 23, 2011, through and
including July 18, 2013, in the City and County of Honolulu,
State of Hawaii, Patrick H. Oki, did intentionally obtain
and exert control over the property of PKF Pacific Hawaii
LLP, including but not limited to, Lawrence Chew, Deneen
. . .
(ii) Knowing that the transportation, transmission,
transfer, receipt, or acquisition of the property
or the transaction or transactions is designed in
whole or in part to:
(A) Conceal or disguise the nature, the
location, the source, the ownership, or the
control of the proceeds of specified
unlawful activity[.]
. . . .
(4) This section shall not apply to any person who
commits any act described in this section unless:
. . .
(b) The value or the aggregate value of the
property transported, transmitted,
transferred, received, or acquired is
$8,000 or more.
6
HRS § 708-893 (2014) provides, in relevant part:
§708-893 Use of a computer in the commission of a
separate crime. (1) A person commits the offense of use of a
computer in the commission of a separate crime if the person:
(a) Intentionally uses a computer to obtain control
over the property of the victim to commit theft in
the first or second degree[.]
7
HRS § 708-852 (2014) provides:
§708-852 Forgery in the second degree. (1) A person
commits the offense of forgery in the second degree if, with
intent to defraud, the person falsely makes, completes,
endorses, or alters a written instrument, or utters a forged
instrument, or fraudulently encodes the magnetic ink character
recognition numbers, which is or purports to be, or which is
calculated to become or to represent if completed, a deed,
will, codicil, contract, assignment, commercial instrument, or
other instrument which does or may evidence, create, transfer,
terminate, or otherwise affect a legal right, interest,
obligation, or status.
(2) Forgery in the second degree is a class C felony.
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Nakashima, Dwayne Takeno, and Trisha Nomura in their
capacities as partners of PKF Pacific Hawaii LLP, by
deception, with intent to deprive PKF Pacific Hawaii LLP,
including but not limited to, Lawrence Chew, Deneen
Nakashima, Dwayne Takeno, and Trisha Nomura in their
capacities as partners of PKF Pacific Hawaii LLP, of the
property, and Patrick H. Oki was aware or believed that the
value of the property did exceed Twenty Thousand Dollars
($20,000.00), and the value of the property did, in fact,
exceed Twenty Thousand Dollars ($20,000.00), thereby
committing the offense of Theft in the First Degree, in
violation of Section 708-830.5(1)(a) and 708-830(2) of the
Hawaii Revised Statutes.
Count 1 relates to a fraudulent reimbursement scheme
that involved misrepresentations about expenses allegedly
incurred in connection with Kamakura Corporation. (HPD
Report No. 14-088031).
COUNT 2: On or about August 3, 2013, through and
including October 9, 2013, in the City and County of
Honolulu, State of Hawaii, Patrick H. Oki, did intentionally
obtain and exert control over the property of PKF Pacific
Hawaii LLP, including but not limited to, Lawrence Chew,
Deneen Nakashima, Dwayne Takeno, and Trisha Nomura in their
capacities as partners of PKF Pacific Hawaii LLP, by
deception, with intent to deprive PKF Pacific Hawaii LLP,
including but not limited to, Lawrence Chew, Deneen
Nakashima, Dwayne Takeno, and Trisha Nomura in their
capacities as partners of PKF Pacific Hawaii LLP, of the
property, and Patrick H. Oki was aware or believed that the
value of the property did exceed Twenty Thousand Dollars
($20,000.00), and the value of the property did, in fact,
exceed Twenty Thousand Dollars ($20,000.00), thereby
committing the offense of Theft in the First Degree, in
violation of Section 708-830.5(1)(a) and 708-830(2) of the
Hawaii Revised Statutes.
Count 2 relates to a fraudulent reimbursement scheme
that involved misrepresentations about expenses allegedly
incurred in connection with AMC Associates. (HPD Report No.
15-037395).
COUNT 3: On or about July 29, 2013, through and
including November 18, 2013, in the City and County of
Honolulu, State of Hawaii, Patrick H. Oki, did intentionally
obtain and exert control over the property of PKF Pacific
Hawaii LLP, including but not limited to, Lawrence Chew,
Deneen Nakashima, Dwayne Takeno, and Trisha Nomura in their
capacities as partners of PKF Pacific Hawaii LLP, by
deception, with intent to deprive PKF Pacific Hawaii LLP,
including but not limited to, Lawrence Chew, Deneen
Nakashima, Dwayne Takeno, and Trisha Nomura in their
capacities as partners of PKF Pacific Hawaii LLP, of the
property, and Patrick H. Oki was aware or believed that the
value of the property did exceed Twenty Thousand Dollars
($20,000.00), and the value of the property did, in fact,
exceed Twenty Thousand Dollars ($20,000.00), thereby
committing the offense of Theft in the First Degree, in
violation of Section 708-830.5(1)(a) and 708-830(2) of the
Hawaii Revised Statutes.
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Count 3 relates to a fraudulent reimbursement scheme
that involved misrepresentations about expenses allegedly
incurred in connection with Asia Market Corporation. (HPD
Report No. 15-037396).
COUNT 4: On or about August 18, 2013, through and
including October 8, 2013, in the City and County of
Honolulu, State of Hawaii, Patrick H. Oki, did intentionally
obtain and exert control over the property of PKF Pacific
Hawaii LLP, including but not limited to, Lawrence Chew,
Deneen Nakashima, Dwayne Takeno, and Trisha Nomura in their
capacities as partners of PKF Pacific Hawaii LLP, by
deception, with intent to deprive PKF Pacific Hawaii LLP,
including but not limited to, Lawrence Chew, Deneen
Nakashima, Dwayne Takeno, and Trisha Nomura in their
capacities as partners of PKF Pacific Hawaii LLP, of the
property, and Patrick H. Oki was aware or believed that the
value of the property did exceed Twenty Thousand Dollars
($20,000.00), and the value of the property did, in fact,
exceed Twenty Thousand Dollars ($20,000.00), thereby
committing the offense of Theft in the First Degree, in
violation of Section 708-830.5(1)(a) and 708-830(2) of the
Hawaii Revised Statutes.
Count 4 relates to a fraudulent reimbursement scheme
that involved misrepresentations about expenses allegedly
incurred in connection with Sumitomo. (HPD Report No.
15-037397).
. . . .
COUNT 5: On or about January 23, 2011, through and
including July 18, 2013, in the City and County of Honolulu,
State of Hawaii, Patrick H. Oki, knowing that the property
involved was the proceeds of some form of unlawful activity,
to wit, theft, did knowingly transfer the property, and
conduct a transaction involving the property, when, in fact,
the property was the proceeds of said specified unlawful
activity, knowing that the transfer and transaction was
designed in whole or part to conceal and disguise the source
and ownership of the proceeds of said specified unlawful
activity, and the value or aggregate value of the property
transferred was $8,000.00 or more, thereby committing the
offense of Money Laundering, in violation of Sections
708A-3(1)(a)(ii)(A) and 708A-3(1)(4)(b) of the Hawaii
Revised Statutes. Patrick H. Oki is subject to sentencing
under Section 708A-3(5)(b) of the Hawaii Revised Statutes,
where the value or aggregate value of the property
transferred was $10,000.00 or more.
A person commits the offense of Theft in the First
Degree, in violation of Section 708-830.5(1)(a) and
708-830(2) of the Hawaii Revised Statutes, if the person
obtains and exerts control over the property of another, the
value of which exceeds Twenty Thousand Dollars ($20,000.00),
by deception, with intent to deprive the other of the
property.
Count 5 relates to money that was obtained as a result
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of the offense set forth in Count 1 herein above,
specifically, money from the Kamakura Corporation-related
scheme. (HPD Report No. 15-037398).
COUNT 6: On or about August 3, 2013, through and
including October 9, 2013, in the City and County of
Honolulu, State of Hawaii, Patrick H. Oki, knowing that the
property involved was the proceeds of some form of unlawful
activity, to wit, theft, did knowingly transfer the
property, and conduct a transaction involving the property,
when, in fact, the property was the proceeds of said
specified unlawful activity, knowing that the transfer and
transaction was designed in whole or part to conceal and
disguise the source and ownership of the proceeds of said
specified unlawful activity, and the value or aggregate
value of the property transferred was $8,000.00 or more,
thereby committing the offense of Money Laundering, in
violation of Sections 708A-3(1)(a)(ii)(A) and
708A-3(1)(4)(b) of the Hawaii Revised Statutes. Patrick H.
Oki is subject to sentencing under Section 708A-3(5)(b) of
the Hawaii Revised Statutes, where the value or aggregate
value of the property transferred was $10,000.00 or more.
A person commits the offense of Theft in the First
Degree, in violation of Section 708-830.5(1)(a) and
708-830(2) of the Hawaii Revised Statutes, if the person
obtains and exerts control over the property of another, the
value of which exceeds Twenty Thousand Dollars ($20,000.00),
by deception, with intent to deprive the other of the
property.
Count 6 relates to money that was obtained as a result
of the offense set forth in Count 2 herein above,
specifically, money from the AMC Associates-related scheme.
(HPD Report No. 15-037399).
COUNT 7: On or about July 29, 2013, through and
including November 18, 2013, in the City and County of
Honolulu, State of Hawaii, Patrick H. Oki, knowing that the
property involved was the proceeds of some form of unlawful
activity, to wit, theft, did knowingly transfer the
property, and conduct a transaction involving the property,
when, in fact, the property was the proceeds of said
specified unlawful activity, knowing that the transfer and
transaction was designed in whole or part to conceal and
disguise the source and ownership of the proceeds of said
specified unlawful activity, and the value or aggregate
value of the property transferred was $8,000.00 or more,
thereby committing the offense of Money Laundering, in
violation of Sections 708A-3(1)(a)(ii)(A) and
708A-3(1)(4)(b) of the Hawaii Revised Statutes. Patrick H.
Oki is subject to sentencing under Section 708A-3(5)(b) of
the Hawaii Revised Statutes, where the value or aggregate
value of the property transferred was $10,000.00 or more.
A person commits the offense of Theft in the First
Degree, in violation of Section 708-830.5(1)(a) and
708-830(2) of the Hawaii Revised Statutes, if the person
obtains and exerts control over the property of another, the
value of which exceeds Twenty Thousand Dollars ($20,000.00),
by deception, with intent to deprive the other of the
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property.
Count 7 relates to money that was obtained as a result
of the offense set forth in Count 3 herein above,
specifically, money from the Asia Market-related scheme.
(HPD Report No. 15-037400).
. . . .
COUNT 8: On or about August 3, 2013, through and
including October 9, 2013, in the City and County of
Honolulu, State of Hawaii, Patrick H. Oki, did intentionally
use a computer to obtain control over the property of PKF
Pacific Hawaii LLP, including but not limited to, Lawrence
Chew, Deneen Nakashima, Dwayne Takeno, and Trisha Nomura in
their capacities as partners of PKF Pacific Hawaii LLP, to
commit Theft in the First Degree, thereby committing the
offense of Use of a Computer in the Commission of a Separate
Crime, in violation of Section 708-893(1)(a) of the Hawaii
Revised Statutes. A person commits the offense of Theft in
the First Degree, in violation of Section 708-830.5(1)(a)
and 708-830(2) of the Hawaii Revised Statutes, if the person
obtains and exerts control over the property of another, the
value of which exceeds Twenty Thousand Dollars ($20,000.00),
by deception, with intent to deprive the other of the
property.
Count 8 relates to the use of a computer to obtain
money to perpetrate the AMC Associates-related scheme set
forth in Count 2 herein above. (HPD Report No. 15-099033).
COUNT 9: On or about July 29, 2013, through and
including November 18, 2013, in the City and County of
Honolulu, State of Hawaii, Patrick H. Oki, did intentionally
use a computer to obtain control over the property of PKF
Pacific Hawaii LLP, including but not limited to, Lawrence
Chew, Deneen Nakashima, Dwayne Takeno, and Trisha Nomura in
their capacities as partners of PKF Pacific Hawaii LLP, to
commit Theft in the First Degree, thereby committing the
offense of Use of a Computer in the Commission of a Separate
Crime, in violation of Section 708-893(1)(a) of the Hawaii
Revised Statutes. A person commits the offense of Theft in
the First Degree, in violation of Section 708-830.5(1)(a)
and 708-830(2) of the Hawaii Revised Statutes, if the person
obtains and exerts control over the property of another, the
value of which exceeds Twenty Thousand Dollars ($20,000.00),
by deception, with intent to deprive the other of the
property.
Count 9 relates to the use of a computer to obtain
money to perpetrate the Asia Market Corporation-related
scheme set forth in Count 3 herein above. (HPD Report No.
15-099034).
. . . .
COUNT 10: On or about August 1, 2013, in the City and
County of Honolulu, State of Hawaii, Patrick H. Oki, did,
with intent to defraud, utter a forged instrument, to wit, a
written contract bearing the logo "AMC" and the title
"Contract For Legal Translation Consulting Services" and
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bearing a signature in the name of "Hide Tanaka", which is
or purports to be, or which is calculated to become or to
represent if completed, a contract or other instrument which
does or may evidence, create, transfer, terminate, or
otherwise affect a legal right, interest, obligation, or
status, thereby committing the offense of Forgery in the
Second Degree, in violation of Section 708-852 of the Hawaii
Revised Statutes.
Count 10 relates to a fraudulent contract bearing the
name AMC Associates. (HPD Report No. 15-099035).
COUNT 11: On or about January 26, 2014, in the City
and County of Honolulu, State of Hawaii, Patrick H. Oki,
did, with intent to defraud, utter a forged instrument, to
wit, an Internal Revenue Service Form W-9 dated January 24,
2014 bearing the name "AMC Associates", which is or purports
to be, or which is calculated to become or to represent if
completed, a contract or other instrument which does or may
evidence, create, transfer, terminate, or otherwise affect a
legal right, interest, obligation, or status, thereby
committing the offense of Forgery in the Second Degree, in
violation of Section 708-852 of the Hawaii Revised Statutes.
Count 11 relates to a fraudulent IRS Form W-9 bearing
the name AMC Associates. (HPD Report No. 15-099036).
COUNT 12: On or about July 15, 2013, in the City and
County of Honolulu, State of Hawaii, Patrick H. Oki, did,
with intent to defraud, utter a forged instrument, to wit, a
written contract bearing the name "Asiamarket Corporation"
and the title "Consulting Agreement" and bearing a signature
in the name of "Gerald Woodard", which is or purports to be,
or which is calculated to become or to represent if
completed, a contract or other instrument which does or may
evidence, create, transfer, terminate, or otherwise affect a
legal right, interest, obligation, or status, thereby
committing the offense of Forgery in the Second Degree, in
violation of Section 708-852 of the Hawaii Revised Statutes.
Count 1[2] relates to a fraudulent contract bearing
the name Asiamarket Corporation. (HPD Report No. 15-099037).
COUNT 13: On or about January 27, 2014, in the City
and County of Honolulu, State of Hawaii, Patrick H. Oki,
did, with intent to defraud, utter a forged instrument, to
wit, an Internal Revenue Service Form W-9 dated January 10,
2012 bearing the name "Asiamarket Corporation", which is or
purports to be, or which is calculated to become or to
represent if completed, a contract or other instrument which
does or may evidence, create, transfer, terminate, or
otherwise affect a legal right, interest, obligation, or
status, thereby committing the offense of Forgery in the
Second Degree, in violation of Section 708-852 of the Hawaii
Revised Statutes.
Count 13 relates to a fraudulent IRS Form W-9 bearing
the name Asiamarket Corporation. (HPD Report No. 15-099038).
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On April 20, 2016, Oki filed a "Motion to Suppress
Evidence Due to Issuance and Execution of Unlawful Search
Warrant" (Motion to Suppress Evidence from Unlawful Search
Warrant), seeking to suppress evidence obtained from a search
warrant of bank records of Oki's accounts at First Hawaiian Bank
and any evidence deriving therefrom. Oki argued that there was
no probable cause to support the issuance of the search warrant.
On the same day, Oki filed a "Motion to Dismiss Counts
8 and 9 of the Indictment" (MTD Counts 8 & 9), seeking to dismiss
the two counts charging him with Use of a Computer. Oki argued
that his prosecution in Counts 8 and 9 was unconstitutional
because: (1) the statute on which the counts were based, HRS §
708-893(1)(a), imposed penalties that amount to "cruel and
unusual punishment"; (2) Counts 8 and 9 violated the equal
protection clause because by being charged under HRS § 708-893,
Oki was treated differently from other individuals charged with
Theft 1, and the statute, as applied to Oki, is overbroad and not
rationally related to the purpose of the statute or the
underlying offense of Theft 1; and (3) Counts 8 and 9 provided
Oki with insufficient notice of the nature and cause of the
accusations. As to his "cruel and unusual punishment" argument,
Oki also pointed out that there were pending bills before the
House and Senate in the 2016 legislative session that recommended
the repeal of HRS § 708-893(1)(a), as it applies to theft
offenses.8 Oki also filed an "Amended Motion to Dismiss Counts 8
and 9 of the Indictment" (Amended MTD) on July 8, 2016.9
8
The bills were subsequently passed and HRS § 708-893(1)(a), as it
read at the time of Oki's offenses, was repealed. 2016 Haw. Sess. Laws Act 231,
§ 42 at 758-59. The legislature explained its actions as "[r]epealing [the]
provision that subjects a person to a separate charge and enhanced penalty for
using a computer to commit an underlying theft crime because it seems unduly
harsh, given the prevalence of "smart phones" and other computing devices." 2016
Haw. Sess. Laws Act 231, § 35 at 756.
9
The Amended MTD most notably provided an updated "Background"
section regarding Oki's "cruel and unusual punishment" argument. The updated
section contained a more current discussion of the legislative action pending at
the time of the motion.
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On April 21, 2016, Oki filed a "Motion to Suppress
Evidence From Warrantless Search and Seizure" (Motion to Suppress
Evidence from Warrantless Search), seeking to suppress evidence
gathered by Nomura and provided to HPD detectives, and any
evidence deriving therefrom. Oki argued that Nomura was acting
as a government agent when she gathered company records and other
materials and turned them over to HPD, thus conducting an illegal
search and seizure.
The circuit court held a three-day evidentiary hearing
on the various motions on September 21, 22, and 27, 2016.10 On
September 22, 2016, the circuit court orally denied the MTD
Counts 8 & 9. The circuit court held that the penalty for HRS §
708-893(1)(a) did not amount to cruel and unusual punishment
under the Freitas11 analysis, his equal protection arguments had
no merit, and the charges were sufficient and not vague.
On September 27, 2016, the circuit court orally denied
the Motion to Suppress Evidence from Unlawful Search Warrant,
holding that there was probable cause for the issuance of the
subject search warrant. As to the Motion to Suppress Evidence
from Warrantless Search, the circuit court took the matter under
advisement until October 20, 2016, when the circuit court orally
denied the motion. The circuit court held that Nomura and the
other partners of PKF were not acting as agents of the State when
they gathered information and materials pertaining to the
allegations against Oki.
The circuit court entered its written orders denying
the subject motions on November 30, 2016.
10
The evidentiary hearing was held to address multiple other pre-trial
motions to dismiss in addition to the subject MTD Counts 8 & 9, Motion to
Suppress Evidence from Unlawful Search Warrant, and Motion to Suppress Evidence
from Warrantless Search. On the second day of the hearing, the court took
judicial notice of the documents attached as exhibits to the various motions,
including a copy of the exhibits and the transcript from the grand jury
proceedings. The circuit court considered these documents in ruling on the
various motions.
11
State v. Freitas, 61 Haw. 262, 602 P.2d 914 (1979).
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The circuit court held a jury-waived trial beginning
February 6, 2017, and concluding on February 17, 2017. A total
of twenty-eight witnesses testified, including the former
partners, HPD employees, police officers from other
jurisdictions, business executives and representatives, and Oki
himself. The circuit court received "approximately 175 exhibits
[into evidence,] which included hundreds of pages of financial
records, spreadsheets, invoices, contracts, business records,
emails and other documents."
On July 20, 2017, the circuit court issued its
"Findings of Fact, Conclusions of Law and Decision" (Decision),
finding Oki guilty as charged, except for Count 4, as to which
the circuit court found Oki guilty of the lesser-included offense
of Theft in the Second Degree (Theft 2), HRS §§ 708-831(1)(b)12
and 708-830(2). The circuit court found that Oki caused
actual and substantial financial loss to the firm as
follows:
a) $345,122.74 in connection with the Kaimana/Kamakura
scheme employed from January 23, 2011 to July 18, 2013;
b) $49,668.70 [13] in connection with the AMC Associates
scheme employed from August 3, 2013 to October 9, 2013;
c) $35,483.75 in connection with the Asia Market scheme
employed from July 29, 2013 to November 18, 2013; and
d) $9,883.35 in connection with the Sumitomo scheme employed
from August 18, 2013 to October 8, 2013, as charged in the
Indictment.
12
HRS § 708-831 (2014) provides, in relevant part:
§708-831 Theft in the second degree. (1) A person
commits the offense of theft in the second degree if the
person commits theft:
. . .
(b) Of property or services the value of which exceeds
$300[.]
13
The circuit court appears to have made a typographical error in
stating the total loss in connection with the AMC Associates scheme. Throughout
trial, the parties and witnesses referred to the loss caused by the AMC
Associates scheme to be $49,688.70. The circuit court also references the
$49,688.70 value in other portions of its Decision. The circuit court
incorrectly references $49,668.70 at one other point in the Decision.
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On October 2, 2017, the State filed "State's Motion for
Restitution" (Motion for Restitution), asking the court to order
Oki to pay restitution in the total amount of $440,178.54,
distributed as $110,044.63 each to Chew, Takeno, Nakashima, and
Nomura. Oki filed a Memorandum in Opposition to State's Motion
for Restitution on October 11, 2017.
On October 17, 2017, the circuit court held a hearing
to address sentencing and, inter alia, the Motion for
Restitution. The circuit court sentenced Oki to indeterminate
terms of imprisonment of ten years each for Counts 1-3, five
years for Count 4, ten years each for Counts 5-7, twenty years
each for Counts 8-9, and five years each for Counts 10-13, with
all terms to be served concurrently with credit for time served.
The circuit court reserved the question of restitution.
On November 20, 2017, Oki filed a Second Memorandum in
Opposition to State's Motion for Restitution.
The State filed "State's Supplemental Motion for
Restitution" (Supplemental Motion for Restitution) on November
20, 2017, seeking restitution in the total amount of $440,178.54
to be distributed to the partners first based on the equity
interest of each partner and then divided equally as restitution
for lost wages. The State explained:
13. Regarding restitution based on "equity ownership
interest", the prosecution is requesting that the Court
order that Defendant pay restitution as follows:
Lawrence Chew: 10.19% equity
10.19% of $440,178.54 equals $44,854.19
Dwayne Takeno: 5.66% equity
5.66% of $440,178.54 equals $24,914.10
Deneen Nakashima: 5.66% equity
5.66% of $440,178.54 equals $24,914.10
Trisha Nomura: 3.77% equity
3.77% of $440,178.54 equals $16,594.73
Total restitution based on equity ownership: $111,277.12
. . . .
20. Regarding restitution based on "lost wages",
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therefore, the prosecution is requesting that the balance of
the $440,178.54 be divided equally by four and that it be
designated as "lost wages" sustained by Chew, Takeno,
Nakashima, and Nomura, pursuant to State v. Demello. The
basic calculation is as follows:
$440,178.54 (total losses proven at trial)
- $111,277.12 (aggregate equity ownership interest
restitution amount)
= $328,901.42 (remaining balance owed to be
designated as "lost wages")
21. The balance of $440,178.54 after deducting the
partners' "equity ownership interest" is $328,901.42. The
prosecution is requesting that that amount be divided by
four to reflect restitution for "lost wages". $328,901.42
divided by 4 equals $82,225.35.
22. Thus, the prosecution is requesting that the
Court issue a free-standing order of restitution that orders
that Defendant pay restitution to Chew, Takeno, Nakashima,
and Nomura as follows:
Lawrence Chew: $82,225.35 (lost wages)
$44,854.19 (equity ownership)
Total: $127,079.54
Dwayne Takeno: $82,225.35 (lost wages)
$24,914.10 (equity ownership)
Total: $107,139.45
Deneen Nakashima: $82,225.35 (lost wages)
$24,914.10 (equity ownership)
Total: $107,139.45
Trisha Nomura: $82,225.35 (lost wages)
$16,594.73 (equity ownership)
Total: $98,820.08
(Emphases omitted and original formatting altered.)
Oki filed a response to the Supplemental Motion for
Restitution on December 11, 2017.
On May 22 and 24, 2018, the circuit court held a
hearing to address the motion for restitution. The circuit court
took judicial notice of the records and files in this matter,
including the Presentence Diagnosis and Report (Presentence
Report) prepared by the Adult Client Services Branch. As part of
the Presentence Report, Nomura, Nakashima, Takeno, and Chew had
submitted victim impact statements and requests for restitution.
Spire had also submitted a victim impact statement and request
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for restitution.14 The circuit court also noted that it had
received letters from Grant Thornton, LLP, (Grant Thornton) and
Spire, asserting rights to restitution payments.15
Chew, Takeno, Nakashima, and Nomura all testified as to
their asserted losses. As support for their requests for
restitution, each partner submitted a spreadsheet and documents
indicating the amount of guaranteed payments they asserted they
should have received during the relevant years and compared it to
the amount of compensation actually received during that time.
The difference between the two values was what they calculated to
be their lost wages due to Oki's crimes. The partners asserted
that their losses were a result of Oki's crimes because, if Oki
had not committed theft of PKF's funds, the firm would have had
the cash resources to pay the partners' compensations and other
expenses. On cross-examination, the partners testified that
there was no formal written agreement as to the amounts of the
partners' guaranteed payments.
The circuit court also allowed a representative of
Spire to make a statement at the restitution hearing, but did not
allow a representative from Grant Thornton to do so.
The circuit court orally ruled on the motion for
restitution, granting it in part and denying it in part. The
circuit court held:
[T]he Court will find that the State has met its burden of
14
The Presentence Report listed the victims as Nomura, Nakashima,
Takeno, and Chew, but noted that it had also contacted Spire because Oki's
attorney had stated that PKF was named as a victim in the present matter and that
PKF had changed its name to Spire.
15
Grant Thornton asserted that PKF had not yet paid the purchase price
for acquiring its accounting practice from Grant Thornton and that Grant Thornton
was therefore PKF's largest creditor. Grant Thornton stated: "It would be
grossly unfair for any restitution payments to go to former (or current) partners
in PKF/Spire without being used to pay down the still-existing, and past-due,
debt owed to Grant Thornton."
Spire asserted that it was the direct victim in the matter because
it was the entity formerly known as PKF and that Spire was left in significant
debt after the former partners compensated themselves during their ownership and
then left the partnership without satisfying the firm's outstanding obligations.
Spire contended that it resorted to submitting a letter directly to the court
because the State refused to acknowledge Spire as a victim.
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proving that the total amount of loss in this case as
reflected previously in the Court's written decision in the
amount of $440,178.54, and that that loss was caused by Mr.
Oki's crimes.
The Court finds that [sic] this amount to be
reasonable and verified based upon the evidence adduced at
trial and during the course of these -- this hearing, and
that the State charged and proved that at trial that the
defendant committed the four different thefts that were
charged in Counts 1 through 4 against the victims identified
as PKF Pacific Hawaii, LLP, including but not limited to,
Lawrence Chew, Deneen Nakashima, Dwayne T[a]keno, and Trisha
Nomura in their capacity as partners of PKF Pacific Hawaii,
LLP.
And so here, the term "victim" really does broadly
encompass both the business entity as well as these named
partners, and these partners are victims, not in their
individual capacity, but only by virtue of their position as
partners of this particular firm. And clearly the
partnership is entitled to restitution from the defendant.
Clearly, the four partners are entitled to restitution from
the defendant, but only in their capacity as partners of
PKF.
And then to the extent that Spire comes along at a
later date after these crimes have been committed and really
stands in the shoes of PKF -- it's the same entity rebranded
-- while there may be certain agreements that may or may not
have been made as to what Spire took on, for all intents and
purposes, the Court is looking at Spire as standing in the
shoes of PKF.
On May 24, 2018, the circuit court entered its Amended
Judgment, which additionally ordered Oki to pay $440,158.5416 in
restitution as follows:
Count 1: $345,122.74 (Kaimana/Kamakura)
(from January 23, 2011 to July 18, 2013)
Count 2: $49,668.70 (AMC Associates)
(from August 3, 2013 to October 9, 2013)
Count 3: $35,483.75 (Asia Market)
(from July 29, 2013 to November 18, 2013)
Count 4: $9,883.35 (Sumitomo)
(from August 18, 2013 to October 8, 2013)
Defendant is ordered to pay restitution to PKF Pacific
Hawaii, LLP, including but not limited to Lawrence Chew,
Deneen Nakashima, Dwayne Takeno & Trisha Nomura in their
16
As discussed supra in footnote 13, it appears the circuit court made
a typographical error in stating the total loss in connection with the AMC
Associates scheme. The error further led to an erroneous calculation of the
total restitution amount. The actual total losses from all four schemes is
$440,178.54, but the circuit court awarded $440,158.54 in restitution.
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capacities as partners of PKF Pacific Hawaii, LLP, as it
existed between January 23, 2011 to November 18, 2013. All
payments shall be deposited into a designated account and
thereafter subject to future claims by the defunct entity,
PKF Pacific Hawaii, LLP, its former partners, as well as,
any other entity including Spire, LLP and Grant Thornton,
LLP, able to establish a legally recognized and enforceable
claim by way of a civil judgment, civil order or settlement
agreement.
(Emphases omitted.) The circuit court also entered a Free-
Standing Order of Restitution providing the same.
On June 19, 2018, Oki timely appealed.
On June 22, 2018, the State timely cross-appealed.
On July 5, 2018, the circuit court filed its "Findings
of Fact, Conclusions of Law, and Order Granting State's Motion
for Restitution" (Order Granting Restitution).
II. POINTS OF ERROR
On appeal, Oki asserts the following points of error:
(1) the circuit court erred in denying Oki's Motion to Suppress
Evidence from Warrantless Search; (2) the circuit court erred in
denying Oki's Motion to Suppress Evidence from Unlawful Warrant;
(3) the circuit court erred in denying Oki's MTD Counts 8 & 9;
(4) there was insufficient evidence that Oki intended to
permanently deprive the partnership of any property; and (5) the
circuit court erred in granting the State's Motion for
Restitution.
On cross-appeal, the State argues that the circuit
court erred in refusing to order Oki to pay restitution directly
to Chew, Nakashima, Takeno, and Nomura, in their capacities as
the sole partners of PKF at the time of Oki's offenses.
III. STANDARDS OF REVIEW
A. Motion to Suppress Evidence
An appellate court reviews a trial court's ruling on a
motion to suppress de novo to determine whether, as a matter of
law, the ruling was right or wrong. State v. Eleneki, 106
Hawai#i 177, 188, 102 P.3d 1075, 1086 (2004). "[F]actual
determinations made by the trial court deciding pretrial motions
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in a criminal case [are] governed by the clearly erroneous
standard," and "conclusions of law are reviewed under the
right/wrong standard." State v. Edwards, 96 Hawai#i 224, 231, 30
P.3d 238, 245 (2001) (quoting State v. Eleneki, 92 Hawai#i 562,
564, 993 P.2d 1191, 1193 (2000)).
"A finding of fact is clearly erroneous when (1) the
record lacks substantial evidence to support the finding, or (2)
despite substantial evidence in support of the finding, the
appellate court is nonetheless left with a definite and firm
conviction that a mistake has been made." State v. Okumura, 78
Hawai#i 383, 392, 894 P.2d 80, 89 (1995) (internal quotation
marks and citation omitted), abrogated on other grounds by State
v. Cabagbag, 127 Hawai#i 302, 315, 277 P.3d 1027, 1040 (2012).
When applying the "clearly erroneous" test, it must be remembered
that
[i]t is for the trial judge as fact-finder to assess the
credibility of witnesses and to resolve all questions of
fact; the judge may accept or reject any witness's testimony
in whole or in part. As the trier of fact, the judge may
draw all reasonable and legitimate inferences and deductions
from the evidence, and the findings of the trial court will
not be disturbed unless clearly erroneous. An appellate
court will not pass upon the trial judge's decisions with
respect to the credibility of witnesses and the weight of
the evidence, because this is the province of the trial
judge.
State v. Eastman, 81 Hawai#i 131, 139, 913 P.2d 57, 65 (1996)
(citations omitted).
B. Constitutional Law
The appellate court reviews questions of constitutional
law de novo under the "right/wrong" standard and, thus, exercises
its "own independent judgment based on the facts of the case."
State v. Jenkins, 93 Hawai#i 87, 100, 997 P.2d 13, 26 (2000)
(internal quotation marks and citations omitted).
C. Statutory Interpretation
The proper interpretation of a statute is a question of
law that is reviewed de novo under the right/wrong standard.
Kimura v. Kamalo, 106 Hawai#i 501, 507, 107 P.3d 430, 436 (2005).
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D. Sufficiency of Evidence
It is well established that evidence adduced in the
trial court
must be considered in the strongest light for the
prosecution when the appellate court passes on the legal
sufficiency of such evidence to support a conviction; the
same standard applies whether the case was before a judge or
a jury. The test on appeal is not whether guilt is
established beyond a reasonable doubt, but whether there was
substantial evidence to support the conclusion of the trier
of fact. Indeed, even if it could be said in a bench trial
that the conviction is against the weight of the evidence,
as long as there is substantial evidence to support the
requisite findings for conviction, the trial court will be
affirmed.
State v. Matavale, 115 Hawai#i 149, 157-58, 166 P.3d 322, 330-31
(2007).
Substantial evidence as to every material element of the
offense charged is credible evidence which is of sufficient
quality and probative value to enable [a person] of
reasonable caution to support a conclusion. And as trier of
fact, the trial judge is free to make all reasonable and
rational inferences under the facts in evidence, including
circumstantial evidence.
State v. Batson, 73 Haw. 236, 248-49, 831 P.2d 924, 931 (1992)
(internal quotation marks and citations omitted).
E. Sentencing
"The authority of a trial court to select and determine
the severity of a penalty is normally undisturbed on review in
the absence of an apparent abuse of discretion or unless
applicable statutory or constitutional commands have not been
observed." State v. Reis, 115 Hawai#i 79, 83, 165 P.3d 980, 984
(2007) (internal quotation marks and citation omitted).
[W]hile a sentence may be authorized by a constitutionally
valid statute, its imposition may be reviewed for plain and
manifest abuse of discretion.
Admittedly, the determination of the existence of clear
abuse is a matter which is not free from difficulty and each
case in which abuse is claimed must be adjudged according to
its own peculiar circumstances. Generally, to constitute an
abuse it must appear that the court clearly exceeded the
bounds of reason or disregarded rules or principles of law
or practice to the substantial detriment of a party
litigant.
State v. Gaylord, 78 Hawai#i 127, 144, 890 P.2d 1167, 1184 (1995)
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(original brackets omitted) (quoting State v. Kumukau, 71 Haw.
218, 227–28, 787 P.2d 682, 688 (1990)); see State v. Rauch, 94
Hawai#i 315, 322, 13 P.3d 324, 331 (2000).
IV. DISCUSSION
A. Motion to Suppress Evidence from Warrantless Search
Oki argues that the circuit court erred in denying his
Motion to Suppress Evidence from Warrantless Search. Oki
contends that Nomura and the other PKF partners conducted an
illegal, warrantless search because they were acting as agents of
the State, rather than as private individuals, when they accessed
the firm's files and gathered numerous documents to submit to
HPD. Therefore, Oki argues, the documents provided to HPD by
Nomura and the other partners should have been suppressed.
The proponent of the motion to suppress has the burden of
establishing, by a preponderance of the evidence, that the
statements or items sought to be excluded were unlawfully
secured and that his or her right to be free from
unreasonable searches or seizures was violated under the
fourth amendment to the United States Constitution and
article I, section 7 of the Hawai#i Constitution.
State v. Spillner, 116 Hawai#i 351, 357, 173 P.3d 498, 504 (2007)
(quoting State v. Kaleohano, 99 Hawai#i 370, 375, 56 P.3d 138,
143 (2002)).
The fourth amendment to the United States Constitution
and article I, section 7 of the Hawai#i Constitution "ensure that
an individual's legitimate expectations of privacy will not be
subjected to unreasonable governmental intrusions." State v.
Kahoonei, 83 Hawai#i 124, 129, 925 P.2d 294, 299 (1996) (quoting
State v. Meyer, 78 Hawai#i 308, 311-12, 893 P.2d 159, 162-63
(1995)). Thus, any evidence obtained by private individuals,
acting wholly on their own initiative, is not protected by the
fourth amendment or article I, section 7, and is admissible in a
criminal trial. Id. However, if an individual conducts a search
while acting as an agent of the government, "the full panoply of
constitutional provisions and curative measures applies." Id. at
127, 925 P.2d at 297 (quoting State v. Boynton, 58 Haw. 530, 536,
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574 P.2d 1330, 1334 (1978)).
In Kahoonei, the Hawai#i Supreme Court held that
when determining whether a private individual is a
government agent under article I, section 7 or the fourth
amendment, there is no bright-line rule of application.
Instead, we must examine the totality of the circumstances
to determine whether the governmental involvement is
significant or extensive enough to objectively render an
otherwise private individual a mere arm, tool, or
instrumentality of the state. In so doing, we focus on the
actions of the government, because . . . the subjective
motivation of a private individual is irrelevant.
83 Hawai#i at 130, 925 P.2d at 300. As to the totality of the
circumstances inquiry, the supreme court has delineated several
factors to be considered, including "whether the private
individual: (1) was actively recruited; (2) was directed by a
government agent; (3) acted for a private purpose; and (4)
received any payment for his or her services." Id. at 127, 925
P.2d at 297 (citing Boynton, 58 Haw. at 537-38, 574 P.2d at
1335).
According to testimony from the partners and HPD, on
February 20, 2014, Nomura, Nakashima, and Takeno met with HPD
Detective Ioane Keehu (Detective Keehu) and HPD Lieutenant John
McCarthy (Lieutenant McCarthy) to report the schemes they
believed Oki was perpetuating to defraud PKF of money. The
partners brought a large binder with over a thousand pages of
documents, including written summaries of the alleged schemes
written by Nomura, spreadsheets, and copies of credit card
statements, invoices, and emails relating to Oki's claimed
expenses. A copy of the binder's contents was introduced into
evidence as Exhibit 40 during the hearing on the Motion to
Suppress Evidence from Warrantless Search.
The PKF partners testified that the binder was compiled
while they were conducting their own internal inquiry into
suspected wrongdoing by Oki and prior to their first meeting with
HPD. After concluding that Oki was involved in fraudulent
activity involving the firm, the PKF partners decided to report
the matter to HPD because they felt they had a fiduciary
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responsibility to the partnership and to protect the partnership
and its clients. At the end of the February 20, 2014 meeting,
Detective Keehu and Lieutenant McCarthy told the PKF partners
that HPD would conduct an investigation into the allegations.
When the meeting ended, the PKF partners took the binder with
them.
The day after the meeting, Nomura sent Detective Keehu
an email with an electronic file of PKF's partnership agreement
as an attachment. Detective Keehu testified that he had
requested the partnership agreement to confirm that the partners
were authorized to report the matter on behalf of the
partnership. Aside from the partnership agreement, Detective
Keehu did not ask the partners to send him any documents or
gather any evidence on his behalf.
On February 25, 2014, Nomura sent the physical binder
and a hard drive to Detective Keehu. The hard drive contained
the electronic files of the binder's contents as well as a
historical copy of Oki's work email account. The decision to
send the hard drive with the electronic copy of the binder's
contents and Oki's email account was made by the PKF partners,
without the involvement of HPD. Detective Keehu did not direct
the PKF partners to make a copy of Oki's email account or provide
electronic files of the binder's contents and was not aware that
the PKF partners were intending to do so until Nomura notified
him that it would be delivered to him. Nomura testified that the
PKF partners decided to make a copy of Oki's email account
because they had concerns about the firm's civil liability for
financial and business transactions entered into by Oki. The
hard drive was not accessed until October 1, 2014, when Detective
Keehu obtained a search warrant to examine its contents.
Oki primarily argues that Detective Keehu directed
Nomura to gather evidence and that several email exchanges
between Detective Keehu and Nomura indicate such direction.
Contrary to Oki's contention, however, the subject emails do not
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reflect that Detective Keehu directed Nomura to take any action.
Rather, the emails show that Detective Keehu contacted Nomura
several times with follow up questions to clarify his
understanding of the information that had been provided at their
initial meeting on February 20, 2014, or in the hard drive that
he had accessed with a search warrant. It is undisputed that the
binder provided to HPD at the February 20, 2014 meeting contained
over a thousand pages of documents. Based on our review of the
emails between Detective Keehu and Nomura contained in the
record, we conclude that any instances where Detective Keehu
asked for evidence17 were not requests for Nomura to search for
and gather any new evidence, but were instead requests for
assistance in locating or explaining the appropriate document
among the numerous documents in the materials that had been
provided by the PKF partners.
Detective Keehu testified that he did not: recruit any
of the PKF partners to take any action on his behalf, offer any
inducement or incentive to gather information on his behalf, or
encourage or instigate the PKF partners to gather evidence or
information on his behalf. Lieutenant McCarthy also testified
that he did not instruct the PKF partners to take any action or
to gather any evidence on behalf of HPD, nor did he hear
Detective Keehu give such instructions. The PKF partners'
testimonies established that their gathering and submission to
HPD of any documents was for the private purpose of preserving
PKF, was of their own volition, and that they were not instructed
by HPD to do so.
17
For example, in an email from Detective Keehu to Nomura, dated
October 17, 2014, Detective Keehu stated: "[W]e need evidence that Oki was
reimbursed for these submitted expenses." Nomura responded by explaining how Oki
was being reimbursed and by directing Detective Keehu to a file on the hard
drive. In another email from Detective Keehu to Nomura, dated October 20, 2014,
Detective Keehu wrote: "The question now is what sort of evidence does PKF have
to substantiate the 'receivable' that Patrick owed? And the evidence showing
that the 'receivable' was paid down by PKF?" In another email on the same day,
Detective Keehu asks for more specific records relating to the same issue.
Nomura responded by directing Detective Keehu to documents in the hard drive and
particular entries in Oki's email account.
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The circuit court found the testimony of Lieutenant
McCarthy, Detective Keehu, and the PKF partners to be credible.
"It is well-settled that an appellate court will not pass upon
issues dependent upon the credibility of witnesses and the weight
of the evidence; this is the province of the trier of fact."
State v. Bailey, 126 Hawai#i 383, 406, 271 P.3d 1142, 1165 (2012)
(internal quotation marks, citation, and brackets omitted).
The totality of the circumstances in this case thus
show that the PKF partners were not acting as agents of HPD when
they gathered the documents. Therefore, any evidence provided by
them is not subject to the fourth amendment of the United States
Constitution or article I, section 7 of the Hawai#i Constitution.
Accordingly, the circuit court did not err in denying Oki's
Motion to Suppress Evidence from Warrantless Search.
B. Motion to Suppress Evidence from Unlawful Search Warrant
Oki argues that the circuit court erred in denying his
motion to suppress evidence obtained through a search warrant (SW
2014-193) for Oki's bank records at First Hawaiian Bank. Oki
contends that probable cause did not exist to support the search
warrant and that Detective Keehu's affidavit in support of the
search warrant is "based on unsubstantiated suspicions by unknown
declarants, with conclusory statements that criminal conduct has
occurred, based on Oki's alleged failure to prove a negative,
that they were not false transactions."
The determination of whether probable cause supported
the issuance of a search warrant is reviewed de novo. State v.
Navas, 81 Hawai#i 113, 123, 913 P.2d 39, 49 (1996). "Probable
cause exists when the facts and circumstances within one's
knowledge and of which one has reasonably trustworthy information
are sufficient in themselves to warrant a person of reasonable
caution to believe that an offense has been committed." Id. at
116, 913 P.2d at 42. "This requires more than a mere suspicion
but less than a certainty." State v. Detroy, 102 Hawai#i 13, 18,
72 P.3d 485, 490 (2003) (internal quotation marks and citation
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omitted). "Direct evidence, however, is not necessary for a
probable cause determination by the magistrate." Navas, 81
Hawai#i at 116, 913 P.2d at 42.
"The finding of probable cause may be based upon
hearsay evidence in whole or in part." Hawai#i Rules of Penal
Procedure Rule 41(c). When hearsay is relied upon to establish
probable cause, however, the courts apply the two prong test in
Aguilar v. Texas, 378 U.S. 108 (1964), and expounded upon in
Spinelli v. United States, 393 U.S. 410 (1969). The affiant must
set forth: (1) the underlying circumstances from which the
informant drew the conclusion regarding criminal activity; and
(2) the underlying circumstances which led the affiant to believe
that the informer was credible and the informer's information was
reliable. State v. Decano, 60 Haw. 205, 210, 588 P.2d 909, 914
(1978); see Detroy, 102 Hawai#i at 18, 72 P.3d at 490. If the
information provided by the informant alone is found inadequate
under Aguilar, "the other allegations which corroborate the
information contained in the hearsay report should then be
considered." Detroy, 102 Hawai#i at 19, 72 P.3d at 491 (internal
quotation marks omitted) (quoting Spinelli, 393 U.S. at 415).
Oki argues that the second prong of the Aguilar test is not met.
Detective Keehu's affidavit asserts that there was
probable cause to believe that Oki committed the offense of Theft
in the First Degree and that Oki's bank records at First Hawaiian
Bank would provide evidence relating to the offense.
The information providing the facts and circumstances
establishing probable cause was gathered through Detective
Keehu's investigation. Detective Keehu stated that he had met
with PKF partners to discuss their suspicions that Oki was
stealing money from the firm. Each partner had an ownership
interest in the firm. At the meeting, Nomura "detailed several
schemes where OKI deceived the Partners, and used the Firm's
money for his own personal use without authorization."
Detective Keehu then outlined the facts pertaining to
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the multiple schemes that Oki allegedly perpetuated to commit
Theft in the First Degree. For the first scheme, Detective Keehu
described the following facts: (1) Oki told his fellow PKF
partners that he was approached by the U.S. government to enter
into a secret arrangement with the U.S. government and a client
firm, Kamakura Corporation (Kamakura), under which Oki would pay
expenses to a third-party consulting firm, Kaimana Consulting
(Kaimana), and PKF would then be reimbursed by Kamakura; (2) Oki
submitted multiple expense reimbursement requests relating to the
alleged secret arrangement; (3) PKF reimbursed Oki for his
expenses with checks payable to Oki or by direct deposit into
Oki's First Hawaiian Bank personal account; (4) PKF was never
reimbursed by Kamakura for the money PKF had given Oki relating
to the alleged secret arrangement, which exceeded $450,000; and
(5) Oki did not provide contact information for his government
contact and the PKF partners could not confirm the existence of
the secret arrangement through inquiries with Kamakura. As to
the second scheme, the facts included: (1) Oki informed the PKF
partners that he began working on a due diligence engagement with
Sumitomo Realty and Development (Sumitomo) for their intended
acquisition of Hawaiian Cement and Ameron; (2) Oki charged large
amounts on his work credit card for hotel stays and other
services he claimed he fronted the costs for as a favor to
Sumitomo, many of which were unaccompanied by evidence that they
were work-related or that any services were actually received;
(3) most amounts were paid through PayPal and did not have
supporting invoices; (4) Oki assured the PKF partners that
Sumitomo would reimburse PKF for the charges; (5) Oki claimed
that the Sumitomo engagement was part of another secret
government arrangement; (6) many of the charges referenced a
"Kishi Sato" who Oki claimed was his Sumitomo contact; (7) Oki
attributed credit card charges for stays at the Trump Hotel to
Kishi Sato, but Detective Keehu discovered that Oki and an
individual named Eunae Harrison were the registered guests; (8)
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when the PKF partners contacted Sumitomo, they were told that
there was no employee named "Kishi Sato"; (9) when one of the PKF
partners asked to be included on emails with Kishi Sato, he
received an email from an individual named Kishi Sato, but the
domain name of the sender's email address did not match the true
domain names of any Sumitomo branch, and was instead a domain
that had been created the same day the email was sent; and (10)
PKF was never reimbursed by Sumitomo for the charges, which
exceeded $170,000 in total. For the third scheme, the facts
included: (1) Oki informed the PKF partners that he would be
traveling to New York with a "Mr. Harrison" for work-related
business; (2) Oki's work credit card showed charges made in both
Chicago and New York during the time period he originally stated
he would be in New York; (3) the charges included airfare to
Chicago and a hotel stay in Times Square, New York, and meal and
entertainment charges in New York; (4) there were further
inconsistencies within Oki's explanations for the inconsistencies
between his credit card charges and the travel plans relayed to
the PKF partners; (5) the name listed on an airline ticket,
Eunael Harrison, was very similar to an individual named Eunae
Harrison who had mail delivered to the PKF office address in a
previous month; (6) Oki initially stated that Eunael Harrison and
Eunae Harrison were two different individuals but later
acknowledged that he had lied and the two were indeed the same
person; and (7) Detective Keehu's search for "Eunae L. Harrison"
on Honolulu Infotrack Investigative Query and Hawai#i Driver's
License database resulted in identifying a Eun Ae Lee Harrison, a
30-year-old woman.
The affidavit stated that the PKF partners approached
Detective Keehu to report the matter on behalf of the alleged
victim partnership, in which each partner had an ownership
interest. The partners volunteered to provide information about
Oki's suspected wrongdoing. The partners were witnesses to the
alleged wrongdoing and parties to the conversations with Oki.
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Furthermore, Detective Keehu also corroborated some of the
information provided by the partners with information obtained
independently.18 These circumstances support a conclusion that
the source of the information was credible. See State v. Decano,
60 Haw. 205, 211, 588 P.2d 909, 914 (1978); cf. State v. Galon,
No. 29654, 2011 WL 2126425, at *2-3 (Haw. App. May 26, 2011)
(SDO) (holding that an officer's affidavit provided sufficient
information of the underlying circumstances to support the
officer's conclusion that the informant was credible or the
information she provided was reliable where the informant had
approached the police as a crime victim and, in volunteering to
provide information about others involved in drug trafficking,
admitted to her own involvement in illegal drug activity, and the
affidavit provided independent information corroborating aspects
of informant's statement).
Oki also argues that the facts set forth in the
affidavit do not amount to evidence that Oki was involved in
criminal activity. Although the facts established in the
affidavit may not constitute direct evidence of any wrongdoing on
Oki's part, we conclude that when the facts are taken together
with the reasonable inferences from those facts, and considered
as a whole, they are sufficient to "warrant a person of
reasonable caution to believe that [the offense of Theft in the
First Degree] has been committed." Navas, 81 Hawai#i at 116, 913
P.2d at 42; see also id. ("Direct evidence, however, is not
necessary for a probable cause determination by the
magistrate."); Decano, 60 Haw. at 209, 588 P.2d at 913 ("It is
clear that only the probability, and not a prima facie showing,
of criminal activity is needed to establish probable cause.").
18
Regarding part of an alleged scheme where Oki had submitted a credit
card invoice for stays at the Trump Hotel attributed to Kishi Sato, who the
partners believed to be a fictional person, Detective Keehu stated that he
checked with the Trump Hotel Honolulu and discovered that Oki and an individual
named Eunae Harrison were the registered guests, and that surveillance photos at
check-in show a male and female that strongly resembled Oki and Eunae Harrison.
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Therefore, we conclude that the facts and circumstances
set forth in Detective Keehu's affidavit established probable
cause to issue the search warrant and the circuit court did not
err in denying the Motion to Suppress Evidence from Unlawful
Warrant.
C. Dismissal of Counts 8 and 9
Oki argues that the circuit court erred in denying his
MTD Counts 8 & 9, which charged Oki with Use of a Computer. Oki
contends that Counts 8 and 9 should have been dismissed because
the statute on which the charges were based, HRS § 708-
893(1)(a),19 was unconstitutional in that it imposed cruel and
unusual punishment for using a computer in the commission of
theft, and also violated the Equal Protection Clause. Oki
further contends that Counts 8 and 9 were vague and did not
provide him with adequate notice of the nature of the charges
against him.
1. Cruel and Unusual Punishment
We first consider the constitutionality of HRS § 708-
893(1)(a). At the time Oki was charged with Use of a Computer,
HRS § 708-893(1)(a) provided that a person who intentionally uses
a computer to commit theft in the first or second degree commits
the separate offense of Use of a Computer. HRS § 708-893(2)
(2014) provided:
Use of a computer in the commission of a separate crime is
an offense one class or grade, as the case may be, greater
than the offense facilitated. Notwithstanding any other law
to the contrary, a conviction under this section shall not
merge with a conviction for the separate crime.
Counts 8 and 9 were charged in connection with Counts 2 and 3,
for Theft 1. Theft 1 is a class B felony punishable by an
indeterminate term of imprisonment of ten years. HRS § 708-
830.5(2); HRS § 706-660(1)(a) (2014). Pursuant to HRS § 708-
893(2), if Oki was convicted of Use of a Computer along with the
19
HRS § 708-893 has since been amended and the provision Oki
challenges has been repealed, as discussed infra.
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underlying offense of Theft 1, the counts for Use of a Computer
would be class A felonies, each carrying indeterminate terms of
imprisonment of twenty years without the possibility of
suspension of sentence or probation. HRS § 706-659 (2014).
Oki argues that the enhanced penalty for Use of a
Computer in the commission of theft amounts to cruel and unusual
punishment, in violation of the eighth amendment to the United
States Constitution and article I, section 12 of the Hawai#i
Constitution.20 Oki specifically maintains that: (1) he did not
commit any violent offense; (2) he had no criminal history and
held an otherwise reputable position in the community and in his
profession; (3) his use of online banking to commit the theft was
not the type of computer use that the legislature intended to
criminalize; (4) Hawai#i was the only state that imposed a
mandatory twenty-year term for using a computer to commit Theft
1; and (5) the penalty was disproportionate as compared to more
serious, violent offenses.
The supreme court has held that "[t]he question of what
constitutes an adequate penalty necessary for the prevention of
crime is addressed to the sound judgment of the legislature and
the courts will not interfere with its exercise, unless the
punishment prescribed appears clearly and manifestly to be cruel
and unusual." Freitas, 61 Haw. at 267, 602 P.2d at 919,
overruled on other grounds by State v. Auld, 136 Hawai#i 244, 361
P.3d 471 (2015).
The standard by which punishment is to be judged under the
'cruel and unusual' punishment provisions of both the United
States and Hawai#i Constitutions is whether, in the light of
developing concepts of decency and fairness, the prescribed
punishment is so disproportionate to the conduct proscribed
and is of such duration as to shock the conscience of
reasonable persons or to outrage the moral sense of the
community.
State v. Kahapea, 111 Hawai#i 267, 282, 141 P.3d 440, 455 (2006)
20
In his opening brief, Oki incorrectly refers to the prohibition
against cruel and unusual punishment as falling under "Section 14 of the Hawaii
Constitution."
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(brackets omitted) (quoting Freitas, 61 Haw. at 267-68, 602 P.2d
at 920).
In Freitas, the supreme court adopted a three-pronged
test to determine whether a punishment is cruel and unusual,
which directs us to consider:
(1) the nature of the offense and/or the offender, with
particular regard to the degree of danger posed by both to
society; (2) the extent of the challenged penalty as
compared to the punishments prescribed for more serious
crimes within the same jurisdiction; and (3) the extent of
the challenged penalty as compared to the punishment
prescribed for the same offense in other jurisdictions.
61 Haw. at 268, 602 P.2d at 920; see State v. Solomon, 107
Hawai#i 117, 132, 111 P.3d 12, 27 (2005). "[T]he nature of the
offense and the danger the offender poses to society are the key
factors in this determination." Freitas, 61 Haw. at 268, 602
P.2d at 920.
In Act 141 of 2006, the legislature amended the offense
of Use of a Computer in HRS § 708-893 to include the intentional
use of a computer in facilitating the commission of theft in the
first or second degree. 2006 Haw. Sess. Laws Act 141, § 1 at
390. The legislature's purpose in this amendment was to "deter
Internet fraud." H. Stand. Comm. Rep. No. 679-06, in 2006 House
Journal, at 1368; S. Stand. Comm. Rep. No. 3116, in 2006 Senate
Journal, at 1511. The legislature recognized:
The use of a computer to commit theft is a growing problem
in Hawai[#]i and the number of crimes that are perpetrated
via the Internet is increasing. The use of a computer as an
instrument of the crime offers the perpetrator relative
anonymity, a quick and easy mechanism to commit fraud, and
the potential for sizable financial gain. According to the
Federal Trade Commission (FTC), Hawai[#]i ranks fifth in the
nation in internet fraud complaints per capita.
S. Stand. Comm. Rep. No. 3116, in 2006 Senate Journal, at 1511.
Furthermore, the legislature expressly contemplated:
[Use of a Computer] carries a penalty one class or grade
above the offense facilitated by the use of a computer.
Thus, in [sic] any theft where the property taken exceeds
$300 would be punishable as a class B felony under [Use of a
Computer]. The use of a computer to steal property valued
in excess of $20,000, would be punishable as a class A
felony under [Use of a Computer].
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H. Stand. Comm. Rep. No. 679-06, in 2006 House Journal, at 1368.
In this case, Oki was charged with Use of a Computer in
Counts 8 and 9 in connection with the charges for Theft 1 in
Counts 2 and 3, respectively. In Counts 2 and 8, Oki was alleged
to have committed theft of over $49,000.21 In Counts 3 and 9,
Oki was alleged to have committed theft of $35,483.75. The
alleged schemes involved Oki creating fictitious identities,
companies, email addresses, websites, and accounts for online
payment services in order to obtain money from PKF. While these
offenses did not involve any violence, we cannot say that the use
of a computer to create fake companies, identities, and online
accounts to obtain money far exceeding the $20,000 threshold for
Theft 1 does not pose a danger to society. Cf. Kahapea, 111
Hawai#i at 282, 141 P.3d at 455 (denying a cruel and unusual
punishment argument for a public official defendant who was
involved in a bid-rigging scheme and was convicted of multiple
counts of theft in the first degree and sentenced to five
consecutive terms of ten years each, citing the "destructive,
deceitful, and wasteful, albeit nonviolent, character of
[defendant's] offenses," despite the defendant's arguments that,
inter alia, he lived a law-abiding life for a substantial period
of time prior to his offenses (emphasis added)). Oki's use of
the computer--specifically, using his work credit card to deposit
money into accounts for online payment services that he created
under the guise of fictitious companies, and later transferring
the money to his personal bank accounts--fall within the purview
of the type of conduct the legislature intended to prevent and
21
During the grand jury proceedings, Detective Keehu testified that
Count 2 was based on theft of $49,688.70, while Count 8 was based on theft of
$49,250.96. Counts 2 and 8 were both based on the AMC Associates scheme, wherein
Oki was alleged to have used his work credit card to deposit money into a Square
account, and then transfer the money to his personal American Savings Bank
account. Oki allegedly deposited $49,688.70 from his work credit card into his
Square account, and then transferred $49,250.96 to his American Savings Bank
account. The lesser dollar amount was "attributed to the fees that Square takes
off of each transaction."
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subject to an enhanced penalty.22 See Solomon, 107 Hawai#i at
132, 111 P.3d at 27 (examining the legislative purpose in
enacting a statute and finding that it evinced the danger the
offense posed to society).
As to the second prong of the Freitas test, compared to
the penalties prescribed for more serious crimes, a sentence of
twenty years for the use of a computer in committing first degree
theft is not so disproportionate as to "shock the conscience of
reasonable persons or to outrage the moral sense of the
community, in light of developing concepts of decency and
fairness." Kahapea, 111 Hawai#i at 282, 141 P.3d at 455. For
example, the more serious offenses of first degree murder, first
degree attempted murder, and second degree murder that is
unnecessarily torturous to a victim, carry sentences of life
imprisonment without the possibility of parole. HRS § 706-656
(2014), HRS § 706-657 (2014). Classifying the use of a computer
to commit first degree theft as a class A felony is comparable to
the classification of other computer crimes as class A felonies.
See HRS § 708-892(2) (2014) ("Computer damage in the first degree
is a class A felony."); HRS § 708-891(2) (2014) ("Computer fraud
22
Oki also contends that the legislature's decision to remove theft
from the purview of HRS § 708-893 in 2016 supports his argument that the statute
imposed cruel and unusual punishment. See 2016 Haw. Sess. Laws Act 231, § 42 at
758-59. Oki specifically points to House Bill 2561, which led to the removal of
theft in the first or second degree as underlying offenses that would subject a
person to the separate offense of Use of a Computer and enhanced penalties. See
H.B. 2561, 28th Leg., Reg. Sess. (2016). House Bill 2561 recommended amending
HRS § 708-893 by "[r]epealing a provision that subjects a person to a separate
charge and enhanced penalty for using a computer to commit an underlying theft
crime because it seems unduly harsh, given the prevalence of 'smart phones' and
other computing devices." Id. (emphasis added). Oki argues that the
legislature's description of the provision as "unduly harsh" lends support to his
argument that the statute unconstitutionally imposes cruel and unusual
punishment.
We do not agree that the legislature's characterization of the
provision as "unduly harsh" indicates an acknowledgment that the statute violated
the protection against cruel and unusual punishment. The Act contained a savings
clause, providing that the repeal of the provision held only proactive effect and
did not have any retroactive effect: "This Act does not affect rights and duties
that matured, penalties that were incurred, and proceedings that were begun
before its effective date[.]" 2016 Haw. Sess. Laws Act 231, § 70 at 775. If the
legislature intended to, it could have made the law have retroactive effect, but
it did not.
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in the first degree is a class A felony."); HRS § 708-895.5(2)
(2014) ("Unauthorized computer access in the first degree is a
class A felony.").
As to the third and final prong of the Freitas test, it
appears that Michigan is the only other state that has a separate
offense for the use of a computer in the commission of a crime.
See Mich. Comp. Laws Ann. § 752.796 (West 2020).23 Michigan
limits the additional penalty for the use of a computer in the
commission of a crime to the maximum term of imprisonment
prescribed for the underlying crime. See Mich. Comp. Laws. Ann.
§ 752.797 (West 2020).24 Thus, the third Freitas factors weighs
23
Mich. Comp. Laws Ann. § 752.796 (West 2020), effective from
September 19, 2000, provides:
Sec. 6 (1) A person shall not use a computer program,
computer, computer system, or computer network to commit,
attempt to commit, conspire to commit, or solicit another
person to commit a crime.
(2) This section does not prohibit a person from being charged
with, convicted of, or punished for any other violation of law
committed by that person while violating or attempting to
violate this section, including the underlying offense.
(3) This section applies regardless of whether the person is
convicted of committing, attempting to commit, conspiring to
commit, or soliciting another person to commit the underlying
offense.
24
Mich. Comp. Laws Ann. § 752.797(3) (West 2020), effective from
September 19, 2000, provides:
(3) A person who violates section 6 is guilty of a crime as
follows:
(a) If the underlying crime is a misdemeanor or a felony with
a maximum term of imprisonment of 1 year or less, the person
is guilty of a misdemeanor punishable by imprisonment for not
more than 1 year or a fine of not more than $5,000.00, or
both.
(b) If the underlying crime is a misdemeanor or a felony with
a maximum term of imprisonment of more than 1 year but less
than 2 years, the person is guilty of a felony punishable by
imprisonment for not more than 2 years or a fine of not more
than $5,000.00, or both.
(c) If the underlying crime is a misdemeanor or a felony with
a maximum term of imprisonment of 2 years or more but less
than 4 years, the person is guilty of a felony punishable by
imprisonment for not more than 4 years or a fine of not more
than $5,000.00, or both.
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in favor of finding that the enhanced penalty imposed by HRS
§ 708-893(1)(a) constituted cruel and unusual punishment.
In considering all three factors together, with
particular focus on the nature of the offense and the danger the
offender poses to society, see Freitas, 61 Haw. at 268, 602 P.2d
at 920, we conclude that the enhanced penalty imposed by HRS
§ 708-893(1)(a) for use of a computer in committing an underlying
theft crime was not unconstitutional.
2. Equal Protection
Oki next argues that HRS § 708-893(1)(a) violated his
equal protection rights under the U.S. Constitution and the
Hawai#i Constitution.
The Equal Protection Clause mandates that all persons
similarly situated shall be treated alike, both in the
privileges conferred and in the liabilities imposed. It
does not, however, require that state legislation operate or
apply equally upon every citizen of a state. A legislative
classification which is reasonable and not arbitrary, and
which is based upon some ground of difference bearing a
rational relation to the objectives sought to be achieved by
the legislation is permissible. . . . And because a statute
is presumed to be constitutional, the party challenging the
constitutionality of a statute on equal protection grounds
bears the heavy burden of showing that the statute is
arbitrary and capricious, and as such, objectionable.
Id. at 271, 602 P.2d at 922 (footnote and citations omitted).
The rational basis standard applies here, where Oki does not
allege that either a fundamental right or a suspect
(d) If the underlying crime is a felony with a maximum term of
imprisonment of 4 years or more but less than 10 years, the
person is guilty of a felony punishable by imprisonment for
not more than 7 years or a fine of not more than $5,000.00, or
both.
(e) If the underlying crime is a felony punishable by a
maximum term of imprisonment of 10 years or more but less than
20 years, the person is guilty of a felony punishable by
imprisonment for not more than 10 years or a fine of not more
than $10,000.00, or both.
(f) If the underlying crime is a felony punishable by a
maximum term of imprisonment of 20 years or more or for life,
the person is guilty of a felony punishable by imprisonment
for not more than 20 years or a fine of not more than
$20,000.00, or both.
(Footnote omitted.)
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classification is implicated. Tax Found. of Hawai#i v. State,
144 Hawai#i 175, 205, 439 P.3d 127, 157 (2019) ("It is
well-established that unless fundamental rights or suspect
classifications are implicated, we will apply the rational basis
standard of review in examining a denial of equal protection
claim." (internal quotation marks and citation omitted)).
As discussed supra, the legislative purpose behind
including theft in the first and second degree as underlying
offenses upon which Use of a Computer could be charged was to
prevent internet fraud in a time when the "use of a computer to
commit theft [was] a growing problem in Hawai[#]i and the number
of crimes that [were] perpetrated via the Internet [was]
increasing." S. Stand. Comm. Rep. No. 3116, in 2006 Senate
Journal at 1511. The legislature acted within its authority when
it provided an enhanced penalty for the use of a computer in the
commission of first and second degree theft to combat the growing
incidence of these crimes. Jenkins, 93 Hawai#i at 114, 997 P.2d
at 40. ("The question of what constitutes an adequate penalty
necessary for the prevention of crime is addressed to the sound
judgment of the legislature[.]" (quoting Freitas, 61 Haw. at 267,
602 P.2d at 920)). Furthermore, Oki has not shown that HRS
§ 708-893(1) no longer bore a rational relationship to its
purpose at the time of his offense. See State v. Bloss, 62 Haw.
147, 157, 613 P.2d 354, 361 (1980) (holding that although a
statute was justified when enacted, it violated the equal
protection guarantee of the U.S. and Hawai#i constitutions where
it no longer bore a rational relationship to the harm it sought
to avoid).
Oki has not met his burden of showing that HRS § 708-
893(1)(a) was arbitrary and capricious.
3. Overbreadth
Oki asserts that HRS § 708-893 is overbroad because
"[o]nline banking is not a crime and does not constitute Internet
fraud" and that the "Legislature could not have intended to 'cast
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such a wide net' when it adopted this statute in 2006
criminalizing so common and innocent an activity as online
banking[.]"
"Generally, one who alleges that a statute is
unconstitutionally overbroad must be directly affected by the
claimed overbroad aspects. That is, the doctrine is generally
limited to challengers who allege that their innocent conduct has
been improperly swept into the reach of the statute." State v.
Alangcas, 134 Hawai#i 515, 527, 345 P.3d 181, 193 (2015)
(quotation marks, ellipsis, and citations omitted).
Oki was convicted of offenses involving Theft 1, which
is the requisite underlying offense for Use of a Computer. HRS
708-893(1)(a). Therefore, Oki's asserted use of "online banking"
is not "innocent conduct [that] has been improperly swept into
the reach of the statute" as he is a person to whom HRS §
708-893(1)(a) directly applies, and he therefore does not have
standing to assert an overbreadth challenge. See Alangcas, 134
Hawai#i at 527, 345 P.3d at 193; State v. Guidry, 105 Hawai#i 222,
240, 96 P.3d 242, 260 (2004) (finding that because the defendant
was a person as to whom a statute directly applied, he does not
have standing to assert an overbreadth challenge based on
hypothetical applications of the statute). HRS § 708-893(1)(a)
requires that a person "[i]ntentionally use[] a computer to
obtain control over the property of the victim to commit theft in
the first or second degree[.]" Use of a computer to conduct
innocent online banking is not prohibited by HRS § 708-893(1)(a),
and thus a substantial amount of constitutionally protected
conduct is not implicated. See Alangcas, 134 Hawai#i at 528, 345
P.3d at 194 ("A court may also entertain a facial overbreadth
challenge when the enactment reaches a substantial amount of
constitutionally protected conduct." (quotation marks and
citation omitted)).
4. Sufficiency of the Charges
As to Oki's contention that Counts 8 and 9 were vague
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and insufficient to provide him with notice of the nature and
cause of the accusations against him, we find this contention has
no merit.
"Where the statute sets forth with reasonable clarity
all essential elements of the crime intended to be punished, and
fully defines the offense in unmistakable terms readily
comprehensible to persons of common understanding, a charge drawn
in the language of the statute is sufficient." State v.
Jendrusch, 58 Haw. 279, 282, 567 P.2d 1242, 1245 (1977); see
Schwartz v. State, 136 Hawai#i 258, 286, 361 P.3d 1161, 1189
(2015).
Counts 8 and 9 were both drawn in the language of the
statutes pursuant to which they were brought and contain all
essential elements of the offense of using a computer in the
commission of theft in the first degree, as well as the
definitions of applicable terms. Both counts provided sufficient
notice that Oki was being charged based on his intentional use of
a computer to obtain control over the property of PKF, as set
forth in Counts 2 and 3. Counts 8 and 9 were therefore
sufficient.
Based on the foregoing, we conclude that the circuit
court did not err in denying Oki's MTD Counts 8 & 9.
D. Sufficiency of Evidence
Oki argues that there was insufficient evidence that he
had the intent to permanently deprive the partnership of any
property. Oki maintains that he was simply collecting what was
due to him based on his capital contributions to the partnership
and his share of the profits, and that, therefore, the
partnership suffered no loss.
During trial, Oki freely admitted that he deliberately
engaged in misleading and deceitful conduct to obtain money from
the firm. Oki also testified that he knew that the money was the
firm's property. Oki used the money that he obtained through his
various schemes for personal expenses.
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Oki testified, however, that he was entitled to any
money that he obtained through his various schemes. During
direct examination, Oki testified that he did not believe he was
committing theft from PKF, explaining as follows:
I felt like I had been underpaid for at least a couple
years, and based on the Partnership Agreement, I'm entitled
to that share of profit based on my ownership percentage.
Also, I was authorized to receive advanced distributions
from the company or from the firm. I also believe there was
no harm made to the firm or to the partners.
Oki also testified that he did not intend to deprive PKF of any
of its property "[b]ecause the money was for [himself]." The
circuit court found Oki's testimony to be "less than credible"
and rejected this argument in finding Oki guilty. On appeal,
this court will not pass upon issues resting on credibility of
witnesses and weight of evidence. Bailey, 126 Hawai#i at 406,
271 P.3d at 1165.
Despite Oki's testimony regarding his belief that he
was entitled to the money he obtained through his fraudulent
schemes, when viewed in a light most favorable to the State,
there was sufficient evidence showing that Oki, knowing that the
money belonged to the partnership,25 intended to keep the money
and use it for himself, thereby depriving the partnership of the
money and the other partners of their ownership interest in the
money. See HRS § 708-830; HRS § 708-830.5; Matavale, 115 Hawai#i
at 157-58, 166 P.3d at 330-31; Batson, 73 Haw. at 248-49, 831
P.2d at 931. There was thus sufficient evidence of Oki's intent
to deprive to support Oki's convictions.
E. Restitution
Notwithstanding the apparent typographical errors
25
HRS § 425-110 (2004) provides: "§425-110 Partnership property.
Property acquired by a partnership is property of the partnership and not of the
partners individually."
HRS § 425-126 (2004) provides: "§425-126 Partner not co-owner of
partnership property. A partner is not a co-owner of partnership property and
has no interest in partnership property which can be transferred, either
voluntarily or involuntarily."
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discussed supra in footnotes 13 and 16, neither party expressly
challenges the $440,158.54 total amount of restitution ordered by
the circuit court. The parties instead dispute the manner in
which the restitution should be collected/distributed. In its
cross-appeal, the State argues that the circuit court should have
ordered Oki to pay restitution of $440,178 directly to Chew,
Takeno, Nakashima, and Nomura, rather than pay the restitution
into a designated account, subject to claims by any person or
entity able to establish a legally recognized and enforceable
claim by way of a civil judgment, order or settlement agreement.
On the other hand, Oki argues that any restitution should not be
paid directly to the other partners as they were not considered
direct victims for restitution purposes. Oki contends that any
restitution should be to PKF alone, subject to the partnership
agreement and any claims by former partners and other entities
with an interest in the firm.
At the time of Oki's sentencing, HRS § 706-646 (2014 &
Supp. 2017) provided, in relevant part:
§706-646 Victim restitution. (1) As used in this
section, "victim" includes any of the following:
(a) The direct victim of a crime including a
business entity, trust, or governmental
entity[.]
. . . .
(2) The court shall order the defendant to make
restitution for reasonable and verified losses suffered by
the victim or victims as a result of the defendant's offense
when requested by the victim. The court shall order
restitution to be paid to the crime victim compensation
commission if the victim has been given an award for
compensation under chapter 351. If the court orders payment
of a fine in addition to restitution or a compensation fee,
or both, the payment of restitution and compensation fee
shall be made pursuant to section 706-651.
(3) In ordering restitution, the court shall not
consider the defendant's financial ability to make
restitution in determining the amount of restitution to
order. The court, however, shall consider the defendant's
financial ability to make restitution for the purpose of
establishing the time and manner of payment. The court
shall specify the time and manner in which restitution is to
be paid. While the defendant is in the custody of the
department of public safety, restitution shall be collected
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pursuant to chapter 353 and any court-ordered payment
schedule shall be suspended. Restitution shall be a dollar
amount that is sufficient to reimburse any victim fully for
losses, including but not limited to:
(a) Full value of stolen or damaged property, as
determined by replacement costs of like
property, or the actual or estimated cost of
repair, if repair is possible[.]
The purpose of restitution in the criminal context is "not only
to repay the person injured by the criminal act, but also to
develop in the offender 'a degree of self-respect and pride' for
having 'righted a wrong committed.'" State v. Feliciano, 103
Hawai#i 269, 272, 81 P.3d 1184, 1187 (2003) (quoting State v.
Murray, 63 Haw. 12, 19 n.11, 621 P.2d 334, 339 n.11 (1980),
overruled on other grounds by Gaylord, 78 Hawai#i at 152-53, 890
P.2d at 1192-93). This court has adopted a preponderance of the
evidence standard in restitution hearings. See State v. Demello,
130 Hawai#i 332, 342-45, 310 P.3d 1033, 1043-46 (App. 2013)
(Demello I), reversed in part on other grounds by State v.
Demello, 136 Hawai#i 193, 361 P.3d 420 (2015) (Demello II).
Chew, Nakashima, Takeno, and Nomura each requested
restitution based on: (1) their equity ownership interest in PKF;
and (2) lost wages suffered as a result of Oki's conduct. The
partners asserted that they should have received a certain amount
of guaranteed compensation each year but did not receive the
amounts they were entitled to, or at some times, did not receive
any compensation at all. Their asserted lost wages were the
differences between the guaranteed compensation they should have
received and the compensation they actually received during the
specified time period.
The circuit court also allowed a representative of
Spire to make a statement in support of its request for
restitution. Spire asserted that it was entitled to restitution
because it was the entity formerly known as PKF. To the extent
that PKF was the direct victim of Oki's crimes, Spire asserted
that Spire was now the appropriate entity to receive the
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restitution payments.
As charged in the Indictment, the victims of Oki's
theft crimes in Counts 1-4 were identified as "PKF Pacific Hawaii
LLP, including but not limited to, Lawrence Chew, Deneen
Nakashima, Dwayne Takeno, and Trisha Nomura in their capacities
as partners of PKF Pacific Hawaii LLP." In its Order Granting
Restitution, the circuit court found and concluded that "both the
business entity, 'PKF Pacific Hawaii, LLP,' as well as, each of
the four partners, 'Lawrence Chew, Deneen Nakashima, Dwayne
Takeno and Trisha Nomura in their capacities as partners of PKF
Pacific Hawaii, LLP' are 'victims' for purposes of restitution."
During trial, Oki testified on several occasions that
the money that he obtained through his schemes belonged to PKF.
Notably, the circuit court, in its Decision, concluded:
5. In Counts 1, 2 and 3, Theft in the First Degree,
the prosecution has proved beyond a reasonable doubt that
during the dates alleged, the Defendant intentionally
obtained and exerted unauthorized control over the property
of PKF, the value of which exceeded $20,000, by deception
with the intent to deprive PKF of the property. . . .
6. In Count 4, Theft in the Second Degree, the
prosecution has proved beyond a reasonable doubt that during
the dates alleged, the Defendant intentionally obtained and
exerted unauthorized control over the property of PKF, the
value of which exceeded $300, by deception with the intent
to deprive PKF of the property. . . .
(Emphases added.) Thus, PKF itself was clearly a "direct victim"
of Oki's crimes, for purposes of HRS § 706-646. No party
disputes that the entity formerly known as PKF, however, now
exists as Spire.26 An entity's name change is a mere formality
26
The circuit court also made findings, unchallenged on appeal,
regarding PKF's name change in its Decision:
81. On September 14 and October 15, 2015, Defendant
filed a separate Statement of Change reporting Lucas Sayin and
Lucas Sayin, LLC as PKF's partners. See, State's Exhibit 195.
82. On October 23, 2015, PKF submitted a Statement of
Amendment reporting PKF Pacific Hawaii, LLP, had changed its
name to Spire Hawaii, LLP ("Spire"). See, State's Exhibit
194.
83. On[] that same date, Spire submitted a Statement of
Change reporting the removal of Patrick Oki and Oki
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and the legal entity itself still remains in existence. Cf. W.T.
Rawleigh Medical Co. v. Bunning, 176 N.W. 85, 86 (Neb. 1920) ("A
change of corporate name does not make a new corporation, but
only gives the corporation a new name." (citation omitted). It
follows, therefore, that Spire, standing in the shoes of PKF, is
the direct victim of Oki's crimes in this matter.
The State, however, asserts that the former partners of
PKF (Chew, Takeno, Nakashima, and Nomura) are also direct victims
and entitled to restitution based on their equity ownership
interest and their lost wages. We disagree. Oki was found to
have committed theft of PKF's property despite Oki having a
majority ownership interest in the property precisely because of
the principle under partnership law that individual partners do
not own any of the partnership assets. See HRS § 425-110
("Property acquired by a partnership is property of the
partnership and not of the partners individually."). For the
same reason, the other partners cannot be found to be owners of
the PKF funds that Oki stole. PKF is a legally separate entity
from the individual partners that constitute the partnership.
HRS § 425-108(a) (2004) ("A partnership is an entity distinct
from its partners.").
The former partners' requests for restitution based on
lost wages also fail for the same reasons. During the
restitution hearing, each partner testified that their lost wages
were a result of Oki's actions because, but for Oki's theft of
PKF funds, PKF would have had sufficient funds available to pay
the partners' guaranteed compensation. This assertion, however,
innately acknowledges that the funds were the property of PKF,
subject to further distribution.
A point of contention during the lower court
proceedings was the nature of how the partners were compensated
Accounting, LLC, as general partners of the firm. See,
State's Exhibit 194.
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and therefore whether the money taken by Oki could be considered
"lost wages" recoverable by the other partners as restitution.
See Demello II, 136 Hawai#i at 197, 361 P.3d at 424 (holding that
reasonable and verified lost wages are recoverable as
restitution). The partners testified at the restitution hearing,
however, that there was no formal written agreement providing the
nature of the guaranteed compensation, that it was done by oral
agreement among all partners, including Oki, and that the only
written documentation were email trails referencing the amounts
of the guaranteed compensation. The partners' purported lost
wages were therefore not verifiable by the circuit court. See
HRS § 706-646 (requiring restitution for reasonable and verified
losses suffered). Adjudicating the actual nature of the
partners' compensation, and therefore what each partner was
entitled to in lost wages, is a determination that requires a
more extensive civil proceeding. Demello II, 136 Hawai#i at 197,
361 P.3d at 424 ("Where lost wages cannot be verified, which may
be the case if the victim was unemployed or if the request is for
expected future income, adjudication will require a more
extensive civil proceeding.").
To the extent that the other partners were identified
by the circuit court as "victims," they were identified as such
solely in their capacities as partners of PKF. Any claim they
have therefore only arises from their relationship to PKF, which
exists as a separate entity. PKF was the sole victim and
therefore the sole entity entitled to restitution. Any dispute,
however, as to the proper allocation of the restitution funds
amongst Chew, Takeno, Nakashima, and Nomura, in their capacities
as PKF's partners at the time of the crimes, would best be
resolved in a civil proceeding. Demello II, 136 Hawai#i at 197,
361 P.3d at 424; see O'Neal v. State, 426 S.W.3d 242, 252-53
(Tex. App. 2013).
V. CONCLUSION
Based on the foregoing, the Amended Judgment of
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Conviction and Sentence, entered on May 24, 2018, in the Circuit
Court of the First Circuit, is affirmed in part and vacated in
part. We also vacate the Free-Standing Order of Restitution. We
vacate the circuit court's order of restitution "into a
designated account and thereafter subject to future claims by the
defunct entity, PKF Pacific Hawaii, LLP, its former partners, as
well as, any other entity including Spire, LLP and Grant
Thornton, LLP, able to establish a legally recognized and
enforceable claim by way of a civil judgment, civil order or
settlement agreement," and remand this matter to the circuit
court to order restitution directly to Spire, the entity formerly
known as PKF. The Amended Judgment is affirmed in all other
respects.
DATED: Honolulu, Hawai#i, June 5, 2020.
On the briefs:
/s/ Katherine G. Leonard
Brian R. Vincent, Presiding Judge
Deputy Prosecuting Attorney,
City and County of Honolulu,
for Plaintiff-Appellee/ /s/ Derrick H. M. Chan
Cross-Appellant. Associate Judge
Peter Van Name Esser,
for Defendant-Appellant/ /s/ Clyde J. Wadsworth
Cross-Appellee. Associate Judge
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