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UNITED STATES v. STEURER

September 30, 1996

UNITED STATES OF AMERICA, Plaintiff,
v.
DALE F. STEURER, Defendant.



The opinion of the court was delivered by: REINHARD

 Defendant, Dale F. Steurer, is charged in an eleven-count indictment with four counts of making false statements of material fact to an institution, the accounts of which are insured by the Federal Deposit Insurance Corporation, for the purpose of influencing action of such institution upon a loan in violation of 18 U.S.C. § 1014 and with seven counts of willfully misapplying money belonging to, and intrusted to the care and custody of, such institution with the intent to injure and defraud in violation of 18 U.S.C. § 656. Consolidated for purposes of this opinion are defendant's Motion to Dismiss: Statute of Limitations, which seeks dismissal of Counts I, II, and III, defendant's Motion to Dismiss Counts I, III, IV, VI, VII, IX, X and XI of the indictment and defendant's Motion for Further Discovery.

 I. Motion to Dismiss: Statute of Limitations

 Defendant initially moved to dismiss Counts I, II and III on the basis that those counts were brought after the expiration of the five-year statute of limitations set forth at 18 U.S.C. § 3282. In its response, the government points out that section 3282 is not applicable to the offenses alleged in Counts I, II and III, rather, the applicable statute of limitations is found at 18 U.S.C. § 3293, which provides for a ten-year period. In his consolidated reply, defendant appropriately concedes that section 3293 is the applicable statute of limitations and moves to withdraw the motion to dismiss these counts on the basis of the statute of limitations. The court, therefore, deems this motion withdrawn.

 II. Motion to Dismiss Counts I, III, IV, VI, VII, IX, X and XI

 Defendant moves to dismiss Counts I, IV, VII and X, each alleging a violation of 18 U.S.C. § 1014, on the basis of duplicity in that each count alleges that defendant made four separate false statements, each of which constitutes a separate violation of section 1014. Each count alleges that defendant prepared a promissory note which contained a fictitious borrower's name, taxpayer identification number, address and purpose for borrowing the funds. Defendant contends that these counts expose him to the risk of being convicted on less than unanimous verdicts.

 Similarly, defendant moves to dismiss Counts III, VI, IX and XI, each alleging a violation of 18 U.S.C. § 656, on the basis of duplicity in that each count alleges that defendant violated section 656 by alternative means. Defendant contends that section 656, which punishes one who "embezzles, abstracts, purloins or willfully misapplies any of the moneys, fund or credits" of a protected institution or "any moneys, funds, assets or securities intrusted to the custody or care" of such an institution, can be violated in at least twelve different ways. *fn1" Because each count tracks the language of section 656, defendant contends that each count, in essence, alleges twelve alternative violations of section 656. Defendant contends that these counts do not give him adequate notice of the charges against him and that these counts expose him to the risk of being convicted on less than unanimous verdicts.

 Duplicity is the "joining of two or more offenses in a single count." United States v. Marshall, 75 F.3d 1097, 1111 (7th Cir. 1996). The adverse effects a duplicitous count can have on a defendant include "improper notice of the charges against him, prejudice in the shaping of evidentiary rulings, in sentencing, in limiting review on appeal, in exposure to double jeopardy, and of course the danger that a conviction will result from a less than unanimous verdict as to each separate offense." Id. ; see also United States v. Kimberlin, 781 F.2d 1247, 1250 (7th Cir. 1985), cert. denied, 479 U.S. 938, 93 L. Ed. 2d 370, 107 S. Ct. 419 (1986). Defendant's motion raises concerns with respect to notice and verdict unanimity.

 Duplicity is not always fatal to an indictment, as corrective instructions and other measures can cure any prejudice that might exist. See, e.g., Kimberlin, 781 F.2d at 1251. Nonetheless, the court must first determine whether the counts at issue are duplicitous. Duplicity exists if a count contains "more than one distinct and separate offense." United States v. Berardi, 675 F.2d 894, 897 (7th Cir. 1982). It does not exist if the count merely charges the "commission of a single offense by different means." Id. ; see also United States v. Kramer, 711 F.2d 789, 797 (7th Cir.), cert. denied, 464 U.S. 962, 78 L. Ed. 2d 339, 104 S. Ct. 397 (1983). Rule 7(c) of the Federal Rules of Criminal Procedure specifically permits a count to allege that the offense was committed by "one or more specified means." Rule 7(c) has been interpreted to contemplate the joining of two or more acts, each one of which would constitute a violation of the same offense standing alone, without offending the rule against duplicity. Berardi, 675 F.2d at 898. While it is often a fine line to draw, a count is not duplicitous where it alleges multiple acts, which independent of each other constitute separate violations of the same statute, if the multiple acts are part of a continuing course of conduct. Id. ; see also United States v. Bruce, 319 U.S. App. D.C. 245, 89 F.3d 886, 890 (D.C. Cir. 1996) (involving a bank fraud scheme comprised of several transactions); United States v. Shorter, 257 U.S. App. D.C. 358, 809 F.2d 54, 57 (D.C. Cir.), cert. denied, 484 U.S. 817, 98 L. Ed. 2d 35, 108 S. Ct. 71 (1987) (involving an ongoing scheme to evade taxes).

 As to Counts I, IV, VII and X, each count alleges that the different promissory note referred to in each count contained four separate false statements. Clearly, each false statement, by itself, violates section 1014. This fact alone, however, does not make these counts duplicitous. Each count concerns a single transaction and document. At least three circuit courts of appeal to confront this issue have found that the making of multiple false statements to a lending institution in a single document constitutes only one criminal violation under section 1014. See, e.g., United States v. Mangieri, 224 U.S. App. D.C. 295, 694 F.2d 1270, 1281 (D.C. Cir. 1982); United States v. Sue, 586 F.2d 70, 71 (8th Cir. 1978); United States v. Sahley, 526 F.2d 913, 918 (5th Cir. 1976). Thus, in those circuits, the government would be precluded from proceeding on an indictment which divided each false statement into a separate count. The First Circuit has taken a slightly different approach and found that no duplicity existed where the false statements were interrelated and each was required to complete the loan transaction. See United States v. Canas, 595 F.2d 73, 78-79 (1st Cir. 1979).

 The Seventh Circuit has not addressed this issue in the context of section 1014. It has, however, addressed the issue in the context of other criminal statutes. See Berardi, 675 F.2d at 898. In Berardi, the Seventh Circuit held that it was permissible to join three acts, each of which could have constituted independent violations of 18 U.S.C. § 1503 (obstruction statute), in one count where the conduct could fairly be characterized as a single, continuing offense. Id. The court also noted that the joining of multiple acts in one count is, in part, a practice which is left to the discretion of the prosecution. Id. (citing United States v. Alsobrook, 620 F.2d 139, 142 (6th Cir.), cert. denied, 449 U.S. 843, 66 L. Ed. 2d 51, 101 S. Ct. 124 (1980); United States v. Tanner, 471 F.2d 128, 138 (7th Cir.), cert. denied, 409 U.S. 949, 34 L. Ed. 2d 220, 93 S. Ct. 269 (1972)). Of course, this discretion is not without limits, as the indictment must eventually be measured in terms of whether it exposes a defendant to any of the inherent dangers of a duplicitous indictment. Alsobrook, 620 F.2d at 142.

 This court need not go so far as the Fifth, Eighth and D.C. Circuits and hold that false statements made in connection with one loan transaction can never constitute more than one offense under section 1014; rather, the court need only decide whether it is proper for the government to join four false statements in one count where the false statements were made in the same document and in connection with the same loan. The court concludes that it is proper, as these four false statements are inextricably related and are clearly part of a continuing course of conduct. In fact, they are even more than that, they are actually part of a single course of conduct. In such circumstances, it is entirely appropriate to join the four statements in a single count. The alternative to charging defendant in this manner would have been to charge him with sixteen counts of violating section 1014 instead of with only four. Instead of indicting defendant with a monkey-pile of counts under section 1014, the government reasonably sought an indictment which charges defendant with four violations of section 1014 which correspond with four separate loan transactions. The court cannot conclude that these counts offend the rule against duplicity.

 Defendant nonetheless claims that there remains a risk that he could be convicted by a non-unanimous jury verdict, relying on Bins v. United States, 331 F.2d 390, 393 (5th Cir.), cert. denied, 379 U.S. 880, 13 L. Ed. 2d 87, 85 S. Ct. 149 (1964). The holding in Bins -- that any acts capable of being charged as separate offenses must be alleged in separate counts--is inapposite to the Seventh Circuit's holding in Berardi, which held that it was permissible to allege three acts of obstruction in a single count where they occurred in a continuing course of conduct notwithstanding the fact that each act by itself could have constituted an independent violation of the statute. Berardi, 675 F.2d at 898; accord United States v. Aracri, 968 F.2d 1512, 1518 (1st Cir. 1992) (rejecting Bins). Any risk of a non-unanimous verdict in this case can be cured with a proper jury instruction. See Berardi, 675 F.2d at 899. *fn2" Accordingly, defendant's motion is denied as to Counts I, IV, VII and X,.

 With respect to Counts III, VI, IX and XI, the court has little difficulty in concluding that no duplicity exists in these counts. The fact that each of these counts tracks, in part, the language of section 656 by alleging alternative means of violating the statute does not make each count duplicitous. Charging a defendant with alternative commissions of the same offense in the same count, as distinguished from charging him with alternative offenses, is expressly authorized by Rule 7(c) and does not offend the rule against duplicity. United States v. Kramer, 711 F.2d 789, 797 (7th Cir.), cert. denied, 464 U.S. 962, 104 S. Ct. 397, 78 L. Ed. 2d 339 (1983); United States v. Epperson, 552 F. Supp. 359, 361 (S.D. Ill. 1982) (count charging the defendant with misapplying "money, funds, and credits" under section 656 not duplicitous); see also United States v. Acosta, 748 F.2d 577, 579 (11th Cir. 1984) (count charging the defendant with willfully embezzling, abstracting, purloining and misapplying money under section 656 not duplicitous). Defendant's claim that these counts do not provide sufficient notice of the charges against him is without merit. In addition to alleging various means of commission, each count sets forth in detail that which was embezzled. In Count Three, it is $ 3,000 in the form of a check made payable to Robert Keister-- in Count Six, $ 5,000, in Count Nine, $ 5,000 and in Count Eleven, $ 35,000. Nor is there a risk of a non-unanimous verdict with respect to these counts. Where a statute provides for alternative means of commission and these alternative means are alleged in a single count, the jury need not agree upon the means of commission in rendering a general ...


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