Unpublished Disposition, 872 F.2d 431 (9th Cir. 1989)Annotate this Case
United States Court of Appeals, Ninth Circuit.
Before CYNTHIA HOLCOMB HALL and LEAVY, Circuit Judges, and EARL H. CARROLL,* District Judge.
Alice Skinner, Defendant-Appellant, contends that there was insufficient evidence to prove that she had knowledge of alleged illegal activities concerning Jet Air, Inc.'s sale of burner cans to Aerospace to support the jury verdicts, and thus insufficient evidence to support her convictions of conspiracy to defraud Pratt & Whitney through use of the mails, mail fraud (7 counts), conspiring to defraud the United States, and unlawful sale of property manufactured on government contract (11 counts). We review the sufficiency of the evidence by determining whether viewing the evidence in the light most favorable to the government, a rational trier of fact could have found the accused guilty beyond a reasonable doubt of the offenses charged. United States v. Dadanian, 818 F.2d 1443, 1446 (9th Cir. 1987).
In Count One of the indictment Skinner was charged with being a member of a conspiracy, the purposes of which were to defraud Pratt & Whitney by using its blueprints to manufacture burner cans for Aerospace, and sending progress billings to Pratt & Whitney which included labor and materials for the burner cans sold to Aerospace.
Counts Two, Three, Four, Six, Eight, Nine and Eleven allege mail fraud arising out of the scheme to defraud Pratt & Whitney alleged in Count One.
There is no evidence, direct or circumstantial, that Skinner was aware of Pratt & Whitney's blueprints, or the proprietary restriction on the use of the blueprints. Similarly, there is no evidence that Skinner was involved in the preparation or mailing of progress billings to Pratt & Whitney.
The fact that several witnesses involved in contract administration or quality control activities were aware of the Pratt & Whitney proprietary restriction does not establish that Skinner had this knowledge. In this regard, the Government's contention (Brief, p. 33)1 that "The evidence quite clearly established that it was a matter of common knowledge that drawings or specifications or blueprints received from Pratt & Whitney in connection with a particular contract could be used only for the purpose of completing that contract and not for another purpose" is misleading, inasmuch as several witnesses including Kenneth R. Anderson, Production Control Manager and a principal government witness, did not testify in this manner.
The circumstances in this case are similar to those at issue in United States v. Krasovich, 819 F.2d 253, 255 (9th Cir. 1987). Krasovich's conviction for conspiracy to defraud the government by impeding the Internal Revenue Service in its collection of income taxes from a drug dealer was set aside. Although Krasovich knew that he was helping drug dealers hide ownership of property from the Government (they gave him money to purchase a pickup in his name), the Court of Appeals concluded:
... there was no evidence, direct or circumstantial, to indicate that when Krasovich purchased the truck in April of 1985, he intended or agreed with anyone else to impede the Internal Revenue Service in its collection of taxes, as charged in the indictment. The appellant therefore argues, and we hold, that the evidence was insufficient to permit a jury reasonably to find Krasovich guilty of the crime charged in the indictment. The conviction must be reversed.
This was so, even though "there may well have been ample evidence that Andrea Drummond intended to use Krasovich to hide the true ownership of property in order to evade income taxes." After noting that there was "no basis on which a reasonable jury could conclude that the defendant Krasovich had the same objective with respect to the transaction", the Court went on to point out that there were other reasons besides concealment to evade taxes, i.e., "to hide ownership of the truck", "use it in illegal activities", to avoid drawing attention to herself or her finances", "or because she feared seizure of the truck under the forfeiture statute if her ownership became known." Id. at 256.
Here, Skinner was obviously aware that 90 burner cans were being selected to fill an order from Aerospace and that some efforts were undertaken to conceal that fact from Pratt & Whitney. There is, however, an absence of proof that she was aware of the objective of the alleged Pratt & Whitney conspiracy or intended to participate in it. Skinner's activities were arguably for the same purpose as Kenneth Anderson, i.e., to keep Pratt & Whitney from learning that Jet Air was selling burner cans to Aerospace at times when it was delinquent in its deliveries to Pratt & Whitney. (Transcript, August 25, p. 168). Consistent with the holding in Ingram v. United States, 360 U.S. 672, 679, 79 S. Ct. 1314, 1320 (1959), "this is not a case where efforts at concealment would be reasonably explainable only in terms of motivation to" defraud Pratt & Whitney as alleged in Counts One, Two, Three, Four, Six, Eight, Nine and Eleven.
In an effort to draw Skinner into the Pratt & Whitney conspiracy, the government contends that Skinner knew that Straza had cancelled the Aerospace order for 90 burner cans (Brief, p. 33). The transcript reference provided does not support this claim--all that it discloses is that Straza told Fred Lorenzen to cancel the purchase order and work order No. 10897, and to give the Aerospace purchase order to Skinner--nothing more. (Transcript August 26, p. 139). Lorenzen did not testify that he told Skinner the purchase order and work order numbers were cancelled. The only reasonable inference from the record is that Skinner did not know of the cancellation, as she used work order No. 10897 on Aerospace invoices which she later typed. (Transcript August 26, 13-14). The Aerospace purchase order was preceded by a Telex from Aerospace. The copy of this Telex (TWIX) which was posted on a bulletin board behind Skinner included the work order number.
A review of the trial transcripts establishes that there is a lack of evidence to demonstrate that Skinner knew of the conspiracy alleged in Count Twelve to defraud the government through Pratt & Whitney, or to sell burner cans to Aerospace which were being made under a contract with the government.
The government's efforts to show this knowledge are unpersuasive and lack support in the record.
Whatever its significance otherwise, the record does not establish, as asserted by the government (Brief, p. 33) that Skinner "was aware that the burner cans were being removed from the Production line (RT August 28, p. 135) immediately preceding the stage when the Pratt & Whitney logo would have been placed on the burner can (RT August 25, pp. 17-19)". (Transcript references in the Brief). Anderson did not testify that he told Skinner how or where he was getting the burner cans needed to fill the Aerospace order. Any pre-taking discussion that the Aerospace burner cans should not have a Pratt & Whitney logo involved Anderson, Straza, Costa and Eddie Hadide (Transcript August 26, pp 47-48).
Aerospace invoices prepared by Skinner included copies for Jet Air's Accounting Department and the cashiers checks received from Aerospace were routinely forwarded by her to Accounting.
As discussed previously, the record does not establish Skinner's awareness of the progress billings, or their relationship to the government. There is nothing to suggest that Skinner was aware that the burner cans belonged to the government--assuming that to be the fact--at the time they were selected for eventual delivery to Aerospace.
There was insufficient evidence presented at trial for a reasonable jury to conclude that Skinner knew about the proprietary language in the blueprints, the title provision in the Pratt & Whitney purchase order or the D.A.R. language on the fly sheet attached to the Pratt & Whitney purchase order. Without evidence that Skinner was told of this information, or had read the documents, there is no basis for finding that she conspired to steal government property, take property being manufactured for the government, or that she is guilty of the eleven crimes charged in Counts Thirty-six through Forty-six (unlawful sale of government property in violation of 18 U.S.C. § 641).
Skinner's convictions are REVERSED on all Counts of which she was convicted.
The Honorable Earl H. Carroll, United States District Judge for the District of Arizona, sitting by designation
This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by Ninth Circuit Rule 36-3
References are to Appellee's corrected Brief