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United States v. Brack

October 31, 1984


Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 83 CR 99 -- Paul E. Plunkett, Judge.

Author: Bauer

Before BAUER, POSNER, Circuit Judges and CAMPBELL, Senior District Judge.*fn*

BAUER, Circuit Judge. Defendant Robert J. Brack appeals his conviction of two counts of mail fraud, in violation of 18 U.S.C. § 1341,*fn1 and two counts of making false statements, in violation of 18 U.S.C. § 1001.*fn2 Defendant appeals on the grounds that the indictment was insufficient or that, even if sufficient, there was a variance between the indictment and the evidence presented by the government at his first trial. Defendant also contends that the evidence presented at his first trial, which resulted in a hung jury and a mistrial, was insufficient, and that therefore his retrial violated his Double Jeopardy and Due Process rights. Finally, defendant argues that the evidence presented at his second trial was insufficient, and that he was denied a fair trial by improper attempts to impeach his testimony and by improper comments during the prosecutor's closing argument.

Facts of the Case

Defendant owned and operated Joseph Construction Company, a general contractor. In May of 1979, defendant entered into a contract to complete a roofing project at Hines V.A. Hospital. The project was originally contracted out to Cleary Waterproofing Company [hereinafter Cleary], but Cleary had defaulted on the contract after completing approximately 80% of the work. Cleary's surety, International Fidelity Insurance Company [hereinafter I.F.I.C.], then entered into a contract with defendant to complete the project.

Cleary had obtained a performance bond from I.F.I.C., and this bond was in turn guaranteed by the Small Business Administration as part of a program designed to assist small contractors in obtaining work. Under its bond guaranty program, the SBA guarantees sureties that it will pay 90% of the losses they may suffer as a result of guaranteeing the performance of small contractors who default. Pursuant to this agreement, the SBA was obligated to reimburse I.F.I.C. for 90% of the cost of its contract with Joesph Construction to complete the roofing project at Hines.

I.F.I.C., which is located in New Jersey, had hired Chrismar Management Corporation [hereinafter Chrismar] to investigate the extent of the work already performed by Cleary on the Hines project and the amount of work needed to complete the project. Chrismar is owned and operated by defendant's brother, Thomas Newhall. After its investigation of the Hines project, Chrismar received a bid of $27,500 form Larson Roofing Company to complete the project. Antonio Alvarado, an architect at Chrismar who investigated the Hines project, determined that Larson Roofing's bid to complete the project was reasonable. I.F.I.C., however, was not informed of Larson Roofing's bid.

Shortly after Chrismar had received Larson Roofing's bid, defendant was contacted by Joseph Consentino, an insurance broker with American Bonding Company, the local agent for I.F.I.C. Consentino described himself as a close personal friend of defendant. Consentino requested an estimate from defendant of the cost of completing the Hines project. Defendant, in turn, requested a bid from Rainey-Harris Roofing Company. Rainey-Harris submitted a bid for $125,185, which included the complete removal of all the roofing material, including work already done by Cleary. At this time, defendant was also informed of Larson Roofing's bid. Defendant then discussed both bids with Consentino, and entered into an agreement with Consentino whereby Joseph Construction would complete the Hines project for $88,547. Shortly after reaching this agreement, on May 21, 979, defendant subcontracted Larson roofing to complete the Hines project for $30,000.

On May 30, 1979 defendant submitted a sworn statement regarding the costs of the Hines project, along with an architect's affidavit, to I.F.I.C. The statement disclosed that Joseph Construction had entered into a contract with Larson Roofing for $34,500 to do roofing work on the project. In fact, Joseph Construction had hired Larson Roofing to complete the Hines project for $30,000. Further, the statement indicated that Joseph Construction has entered into a contract with Stanton Bay Construction to do "Slate Repair" for $31,381. In fact, Joseph Construction had no contract whatsoever with Stanton Bay, which was not qualified to do the roofing work needed on the Hines project. The statement also included amounts of $10,400 and $12,266 to Joseph Construction for "Supervision" and "General Conditions," respectively. Finally, the architect's affidavit was signed by Newhall, who is not an architect, before the figures above were entered on it by defendant.

The May 30 statement sought payment of $39,560 from I.F.I.C. for "work already completed." The statement indicated that the payment requested would be divided as follows: $11,500 to Larson Roofing, $20,460 to Stanton Bay, and $7,600 to Joseph Construction. Upon receipt of the statement, I.F.I.C. issued a check for $39,560 to Joseph Construction. It was not until July 20, however, that Larson Roofing sent its first request for payment to Joseph Construction in the amount of $10,000, and, as just stated, no money was due to Stanton Bay for work on the Hines project.

On July 30, 1979, I.F.I.C. received a similar statement from Joseph Construction, requesting payment in the amount of $29,954. This statement incorporated the figures listed in the May 30 statement and indicated that payments had been made to Larson Roofing and Stanton Bay in the amounts listed in that statement. In fact, no payments to either company had been made. The July 30 statement also indicated that portions of the payment requested would be sent to Larson Roofing and Stanton Bay. Newhall again signed a blank architect's affidavit for the July 30 statement.

Apparently due to a dispute involving payment for other jobs which Joseph Construction had been hired by I.F.I.C. to complete, no payment was made to Joseph Construction based on the second request. Rather, in October of 1979, I.F.I.C. made no direct payment of $30,000 to Larson Roofing, which had received no money from Joseph Construction, for the completion of the Hines project. In fact, Larson Roofing was the only contractor to work on the Hines project, which it successfully completed for $30,000.

On February 7, 1983, defendant was indicted and charged with two counts of mail fraud and two counts of making false statements. The indictment alleged that defendant devised a scheme to defraud the government by obtaining a fraudulently inflicted contract with I.F.I.C. and by submitting false statements to I.F.I.C. to conceal the fraudulent nature of the contract. Defendant's first trial ended in a hung jury and a mistrial. At that trial, defendant moved for a directed verdict and, after the mistrial was declared, for judgment of acquittal based on the insufficiency of the evidence. Neither motion was granted, and a second trial was ordered, at which defendant was convicted of all four charges against him.

I. Sufficiency of the Indictment

Defendant first contends that the indictment was insufficient to allege violations of both the mail fraud counts*fn3 and the false statement counts.*fn4 An indictment is sufficient if it contains the elements of the offense charged and adequately informs the defendant of the specific charges against him, enabling him to prepare a defense for trial and permitting him to plead an acquittal or conviction in order to bar any future prosecution for the same offense. Hamling v. United States, 418 U.S. 87, 117-18, 41 L. Ed. 2d 590, 94 S. Ct. 2887 (1974); United States v. Debrow, 346 U.S. 374, 376, 98 L. Ed. 92, 74 S. Ct. 113 (1953); Hagner v. United States, 285 U.S. 427, 431, 76 L. ...

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