Unpublished Disposition, 917 F.2d 566 (9th Cir. 1987)

MEMORANDUM^* 

James Brimhall appeals his convictions for wire fraud, racketeering, aiding and abetting, and conspiracy. Brimhall contends that he suffered a violation of his right to due process due to preindictment delay. He also contends that insufficient evidence supports his conviction for conspiracy and that the district court erred in refusing to allow attorney participation in voir dire, refusing a change of venue, limiting the scope of cross-examination, and admitting evidence. We have jurisdiction pursuant to 28 U.S.C. 1291 (1988). We affirm.

This case involves Brimhall's involvement in fraudulent financing arrangements used to generate capital for a project called "The Farmer's Market" in Las Vegas, Nevada. The Farmer's Market project involved renovating an old department store into a shopping center. Sam Calabrese conceived and promoted the Farmer's Market project. Farmer's Market was a wholly owned subsidiary of A.V.A. Investments. Due to Calabrese's reputation as a con-artist and past criminal convictions for fraud, Calabrese employed three other persons to act as officers and directors of A.V.A..

One of Calabrese's schemes to raise capital for construction costs for Farmer's Market was a lease back agreement. Brimhall, who has extensive experience in tax-oriented equipment leasing was hired in order to develop a lease proposal.

Brimhall, with the assistance of the principals of Farmer's Market, eventually put together a lease proposal which was accepted by E.F. Hutton. The lease agreement provided that Hutton would finance the purchase of five million dollars worth of equipment slated for use in the Farmer's Market project. Hutton would retain ownership of that equipment and then lease it back to Farmer's Market.

Showcase International acted as an intermediary between Hutton and Farmer's Market. Hutton believed that Showcase International would purchase the necessary equipment and then bill Hutton. Unbeknownst to Hutton, Calabrese co-owned Showcase International with Joe Heller.

Calabrese, acting through Showcase International, diverted payments for equipment lease payments made by Hutton for construction costs to Allstate Thrift, Glacier Assurance Company, and First Nevada Capital. Calabrese had control over both Allstate and First Nevada. Brimhall helped Calabrese divert many of these payments by vastly overstating the value or amount of equipment purchased or by falsely billing nonexistent charges.

A jury found Brimhall guilty of two counts of conspiracy to commit wire fraud, in violation of 18 U.S.C. § 371, nine counts of wire fraud, and aiding and abetting wire fraud in violation of 18 U.S.C. §§ 1343, 2.

The conduct leading to Brimhall's indictment occurred in April to June of 1983. The prosecution filed its indictment on May 19, 1987. Brimhall first claims that he suffered preindictment delay because of the amount of time that elapsed between Calabrese's death and his indictment.

In order to establish a claim for preindictment delay, Brimhall must first establish, in a definite and non-speculative manner, actual prejudice. United States v. Sherlock, 865 F.2d 1069, 1073 (9th Cir. 1989). Brimhall contends that Calabrese would have testified to Brimhall's lack of knowledge of any scheme to defraud. It is difficult to see how Calabrese's death is related to preindictment delay. Calabrese died in 1984. Brimhall does not claim that the prosecution should have indicted him prior to Calabrese's death--he merely claims he suffered prejudice because the government waited too long after Calabrese's death. However, Calabrese's testimony would be just as unavailable right after his death as three years after his death. Moreover, Brimhall offers no testimony to support his assertion. Vague and conclusory allegations of prejudice due to the death or unavailability of certain witnesses or the loss or destruction of exculpatory evidence are uniformly rejected. See, e.g., United States v. Horowitz, 756 F.2d 1400, 1405 (9th Cir.), cert. denied, 474 U.S. 822 (1985).

Brimhall claims he suffered preindictment delay because he did not know the government was investigating him and if he had, he would not have testified at unrelated civil trials during the investigation. Again, we refuse to find Brimhall suffered actual prejudice from his own testimony given at civil trials. A review of the record reveals that the strongest evidence against him comes not from his own testimony, but from the testimony of Brimhall's coconspirators who testified as to Brimhall's active and willing participation in the diversion of Hutton funds. Furthermore, any prejudice resulting from Brimhall's own testimony is fairly balanced by the reason for the delay. See United States v. Moran, 759 F.2d 777, 781 (9th Cir. 1985) (delay must be balanced against reasons for delay to determine if due process was violated), cert. denied, 474 U.S. 1102 (1986). The Farmer's Market case was an investigative effort which required investigation of several thousand documents and resulted in numerous indictments brought against ten different defendants. Four years is a reasonable amount of time to accomplish such a task. See United States v. Lovasco, 431 U.S. 783, 792-96 (1977) (prosecutors are not compelled to file charges until they are satisfied they can establish the suspect's guilt beyond a reasonable doubt). We reject Brimhall's claim that he suffered preindictment delay.

Brimhall contends that the district court erred by refusing to permit his attorney to participate in voir dire. Participation by Brimhall's attorney was necessary, Brimhall argues, because: 1) the failure of Allstate Thrift allegedly caused a number of the residents of Nevada to feel animosity towards persons associated with Calabrese; and 2) certain Nevadans were prejudiced against Brimhall due to his participation in anti-union activities while working for the Landmark Hotel.

"The district court has considerable discretion in determining the manner and scope of voir dire." United States v. Toomey, 764 F.2d 678, 682 (9th Cir. 1985), cert. denied, 474 U.S. 1069 (1986). We will disturb the exercise of that discretion only if the district court abused it. Id. Pursuant to Fed. R. Crim. P. 24(a), the district court may conduct the examination itself or allow the attorneys to do so. Id. If the district court chooses to conduct voir dire, "it must exercise sound judicial discretion in accepting or rejecting supplemental questions proposed by counsel." Id. The district court must ask questions "reasonably sufficient" to test jurors for bias or partiality. United States v. Baldwin, 607 F.2d 1295, 1297 (9th Cir. 1979).

Nothing in the record indicates that the district court abused its discretion in conducting the voir dire itself. Furthermore, the district court accepted questions which reasonably tested jurors for bias arising out of the failure of Allstate Thrift, Farmer's Market or Brimhall's anti-union activities. The district court asked whether: 1) a juror had good or bad experiences with banks and lending institutions; 2) a juror had any involvement with Farmer's Market or Allstate Thrift; 3) a juror had any holdings with Hutton; 4) a juror had any union affiliation; and 5) a juror had any affiliation with Landmark Hotel. Moreover, in order to solve the problem of guilt by association with Calabrese, the district court granted Brimhall's motion for severance from the trial of the principals of A.V.A. linked to Calabrese. The district court did not abuse its discretion in denying Calabrese's motion for attorney participation in voir dire or in conducting the voir dire itself.

Brimhall contends that the district court abused its discretion in denying his motion for change of venue because of the amount of pretrial publicity generated by the failure of Allstate Thrift. The district court has broad discretion in denying a motion for change in venue. United States v. Rewald, 889 F.2d 836, 863 (9th Cir. 1989).

Brimhall must demonstrate either presumed prejudice or actual prejudice in order to warrant a change in venue. Id. Presumed prejudice is only "rarely applicable." Harris v. Pulley, 852 F.2d 1546, 1553 (9th Cir. 1988), cert. denied, 110 S. Ct. 854 (1990). Presumed prejudice exists only where:

the pretrial publicity was so extensive or the examination of the entire panel revealed such prejudice that a court could not believe the answers of the jurors and would be compelled to find bias or preformed opinion as a matter of law.

Id. (citing Beck v. Washington, 369 U.S. 541, 557 (1962)). Brimhall did not introduce facts sufficient to meet this difficult standard. Although newspapers carried stories about the misdeeds surrounding Farmer's Market only a small percentage of these related to Brimhall. See United States v. Neal, 718 F.2d 1505, 1510-11 (10th Cir. 1983) (no prejudice where little pretrial publicity specifically implicated the defendant), cert. denied, 469 U.S. 818 (1984).

Nor does Brimhall show actual prejudice. Brimhall moved for change of venue prior to voir dire and failed to renew that motion anytime thereafter. We find that, given that Brimhall's challenge to voir dire is unsuccessful because the district court asked questions sufficient to test juror bias, any personal vendettas held by members of the community were screened from Brimhall's trial. See United States v. McDonald, 576 F.2d 1350, 1354 (9th Cir. 1978) (ultimate question is whether it is possible to select a fair and impartial jury and the proper occasion for that determination is the voir dire examination), cert. denied, 439 U.S. 830 (1978). The district court did not abuse its discretion in denying Brimhall's motion for change of venue.

Brimhall contends insufficient evidence supports a necessary element for his conspiracy convictions--knowing participation in the conspiracy to defraud Hutton. We review de novo whether the prosecution admitted evidence such that any rational trier of fact could have found the essential elements of conspiracy beyond a reasonable doubt. See United States v. Power, 881 F.2d 733, 736-737 (9th Cir. 1989).

Brimhall's claim borders on the frivolous. He does not dispute that the following evidence, which is only a sampling of the evidence indicating his knowing conspiracy, was introduced at trial: 1) Heller testified that he, Brimhall and Calabrese had discussed the payment of $675,000 to Allstate Thrift in violation of the Hutton lease agreement; 2) Heller testified that he instructed Brimhall to falsify equipment invoices to justify overcharging Hutton; 3) Heller testified that Calabrese questioned Brimhall on ways to divert $685,000 from Hutton funds to pay for debts incurred by A.V.A. and construction costs; 4) Ron Remund, one of the directors of A.V.A. installed by Calabrese, testified that he discussed diverting Hutton funds for construction costs with Brimhall; and 5) Remund and Smith testified that, after Hutton refused to permit Hutton funds to be used for constructing a clock tower and domes for the Farmer's Market building, Brimhall told Heller to bill falsely those construction costs as equipment costs. Sufficient evidence supports Brimhall's convictions for conspiracy.

E. RESTRICTION OF THE SCOPE OF CROSS-EXAMINATION

We review a district court's decision to limit cross-examination for an abuse of discretion. United States v. Feldman, 788 F.2d 544, 554, (9th Cir. 1986), cert. denied, 479 U.S. 1067 (1987). Brimhall contends the district court erred by refusing to permit cross-examination of Ronald Johnson, Brimhall's former employer at First Nevada Leasing and the person in charge of handling the Farmer's Market account prior to Brimhall's participation, with regard to a $500,000 loan Brimhall alleges was made by Johnson without collateral. Brimhall sought to introduce evidence of that loan in order to contradict Johnson's earlier testimony that Johnson had not made such a loan and thereby impugn Johnson's credibility.

The district court has the discretion to permit inquiry into specific instances of conduct for purposes of credibility "if probative of truthfulness or untruthfulness." Fed.R.Evid. 608(b). We find that the district court did not abuse its discretion in deciding that, although evidence of the alleged existence of the loan would have impugned Johnson's credibility, that evidence would only serve to waste the jury's time on a collateral matter. Moreover, any minor disadvantage Brimhall suffered from the inability to cross-examine Johnson on this matter was harmless. See United States v. Jenkins, 884 F.2d 433, 436 (9th Cir. 1989) (applying harmless error analysis to restriction of cross-examination), cert. denied, 110 S. Ct. 568 (1989). Not only was much of Johnson's testimony cumulative of other testimony admitted against Brimhall, the evidence of Brimhall's guilt was overwhelming. See id. (whether error was harmless depends upon whether testimony was cumulative and strength of prosecution's case).

Brimhall also sought to cross-examine Robert L. Bambach, president of Hutton, with regard to $12,500 of a due diligence fee Brimhall alleges that Bambach misappropriated; and Robert L. Smith, a contractor, with regard to money Brimhall alleges Smith received in kickbacks from A.V.A.. Neither Bambach or Smith asserted they did not misappropriate funds. Thus the cross-examination Brimhall sought would have impugned their credibility only indirectly if at all--the jury might have concluded that they were not credible because they had taken part in unethical conduct. Given the complexity of the transactions in which Bambach and Smith were alleged to have participated, and the tenuous link of misconduct to credibility, we find that the district court did not abuse its discretion in balancing the probativeness of this evidence against waste of the jury's time and denying cross-examination for purposes of attacking credibility.

Lastly, Brimhall contends that cross-examination of Johnson, Bambach and Smith was necessary in order to show their attempts at minimizing their role in the Farmer's Market scheme, thereby implicating Brimhall in order to protect themselves. Brimhall fails to prove this contention and it is difficult to imagine how he would do so. We do not see, and Brimhall does not make clear, how Johnson's, Bambach's and Smith's alleged attempts to hide their alleged prior misdeeds "implicates" Brimhall or affects the likelihood that Brimhall took part in the activity for which he was convicted--conspiracy to defraud. The district court did not err in restricting Brimhall's attempts at cross-examination.

F. INTRODUCTION INTO EVIDENCE OF NEWSPAPER EDITORIAL

We review the district court's decision to admit evidence for an abuse of discretion. United States v. Lee, 846 F.2d 531, 536 (9th Cir. 1988). Brimhall contends the district court abused its discretion by admitting into evidence, in violation of Fed.R.Evid. 403 (barring evidence if the probative value of that evidence is substantially outweighed by its prejudicial effect), a newspaper article which details Calabrese's prior felonies and possible misconduct in relation to the Farmer's Market project.

Brimhall's contention is again meritless. The prosecution admitted the article not for the truth of any of the statements it contained, but rather to show that Brimhall had knowledge of Calabrese's criminal background during the time Brimhall was diverting Hutton funds. Proof of that knowledge was relevant to refute Brimhall's constant assertions that he had no knowledge of, or reason to know of, the fraud perpetrated by Calabrese. At trial, the government introduced into evidence the portions of Brimhall's deposition testimony wherein Brimhall admitted that he had read the article, thereby conclusively refuting his feigned ignorance of Calabrese's criminality. Moreover, that article had limited prejudicial effect relative to Brimhall--nowhere does the article mention Brimhall's name or his involvement in the Farmer's Market project. The district court did not abuse its discretion in admitting the article.

The judgment of the district court is AFFIRMED.