The opinion of the court was delivered by: Judge Blanche M. Manning
Defendants John Sullivan, his brother Dan Sullivan, and Patrick Rooney are charged with operating a scheme in which they convinced elderly homeowners to refinance their homes in order to hire the defendants' home repair business for work the defendants never intended to perform.
The two Sullivan defendants and the government have filed numerous motions in limine in advance of trial. Evidence should be excluded on a motion in limine "only when evidence is clearly inadmissible on all potential grounds . . . [and][u]nless evidence meets this high standard, evidentiary rulings should be deferred until trial." See Steck v. Bimba Mfg Co., No. 96 CV 7442, 1997 WL 685003, at *1 (N.D. Ill. Oct. 30, 1997). The denial of a motion in limine does not mean that the evidence is necessarily admissible, rather, it means only that the party moving in limine has not demonstrated that there is no possible basis for the admission of the evidence. See Holmes v. Sood, No. 02 CV 7266, 2006 WL 1988716, at *1 (N.D. Ill. July 12, 2006). The denial of a motion in limine does not preclude a party from objecting to the admission of any evidence at trial. See United States v. Connelly, 874 F.2d 412, 416 (7th Cir.1989) ("a ruling [on motion in limine is] subject to change based upon the court's exposure to the evidence at trial").
Keeping in mind these observations, the court addresses the parties' motions in limine in turn.
DEFENDANT JOHN SULLIVAN'S MOTIONS
1. Motion to Bar Evidence of Defendant's Alleged Flight [101-1] J. Sullivan seeks to bar evidence that he fled authorities. The government does not intend to present such evidence unless first raised by the defendant, so the motion is granted.
2. Motion to Bar Evidence of Defendant's Alleged Drug Use [102-1] J. Sullivan seeks to bar evidence of his alleged drug use. The government does not intend to present evidence that J. Sullivan used drugs himself. However, it does anticipate presenting evidence that J. Sullivan compensated a former employee involved in the alleged scheme with cocaine. J. Sullivan's alleged payments in cocaine are relevant to the charged conduct and therefore such evidence is not excluded. However, the motion to exclude evidence of J. Sullivan's own alleged use of illegal substances is granted.
3. Motion to Bar Evidence of Money Found in Ex-Wife's Home [103-1] J. Sullivan seeks to bar evidence of money found in a safe in his ex-wife's home. The government does not object to the motion and, therefore, the motion is granted.
4. Motion to Bar Evidence of Alleged Thefts from Customers' Homes [104-1] Next, J. Sullivan seeks to bar evidence of thefts of items from the homes of his customers. J. Sullivan contends that such evidence is irrelevant because he did not "direct, participate in, authorize, or ratify" any of the thefts. Motion [104-1] at 1. However, the indictment alleges that J. Sullivan schemed with his co-defendants and, as part of the scheme, if "a customer requested a copy of the contract, defendants JOHN SULLIVAN, DANIEL SULLIVAN and PATRICK ROONEY, and others acting with them and at their direction, later returned to the house and attempted to steal the customer's copy of the contract." Superseding Indictment [45--1] ¶ 12. The thefts are therefore evidence of the charged scheme and, for that reason, the motion to bar evidence of the thefts is denied.
5. Motion to Bar Evidence of Breach of Contract Lawsuit [105-1] J. Sullivan seeks to bar evidence of a breach of contract lawsuit filed against him in 2010 in the Circuit Court of Cook County. The government does not object to the motion and, therefore, it is granted.
6. Motion to Bar Evidence of Defendant's Prior Conviction [106-1] J. Sullivan seeks to bar evidence of his prior state court conviction for theft/deception. J. Sullivan contends that evidence of his prior conviction will unduly prejudicial under Federal Rule of Evidence 609(a)(1) because jurors may conclude that if J. Sullivan was guilty of the prior offense, he must also be guilty of the instant offense.
Under Rule 609(a)(1), evidence of prior crimes may be used to impeach a witness at trial, unless the witness is a criminal defendant and the court determines that the probative value of the impeaching evidence is outweighed by its prejudicial effect. One of the conditions the state court imposed as part of J. Sullivan's sentence for his state court conviction was prohibiting him from engaging "'in home repair, home rebuilding, remodeling of any kind, nor any construction contracting of any kind.'" Response [139-1] at 10 (quoting state court conviction). Therefore, the conviction is highly probative of his knowledge and intent to engage in the instant offense of fraud involving home repairs. Because the evidence is highly probative, it outweighs the risk of any prejudicial effect of the conviction.
Accordingly, the motion to exclude is denied.
7. Motion to Bar Evidence of Injunction against Defendant [107-1] Next, J. Sullivan seeks to bar evidence of a permanent injunction entered in 2004 that imposed a lifetime ban on the defendant's involvement in the home repair industry in Chicago, whether paid or unpaid. The injunction was the result of a lawsuit filed against him by the City of Chicago alleging home repair fraud. In support of his motion to bar evidence of the injunction, J. Sullivan contends that the injunction is "entirely irrelevant" to the wire fraud allegations he faces in this case.
To convict J. Sullivan of wire fraud, the government must prove each of the following elements: (1) the defendant knowingly devised or participated in a scheme to defraud or obtain money or property by means of materially false pretenses, representations, promises, or omissions; (2) the defendant did so knowingly and with the intent to defraud; and (3) the defendant employed an interstate telephone call or electronic communication in furtherance of the scheme. United States v. Fenzi, No. 09 CR 376, 2011 WL 2020825, at *3 (N.D. Ill. May 24, 2011). According to the superseding indictment, J. Sullivan participated in a scheme that targeted elderly Chicago residents by convincing them they needed home repairs the defendants never intended to perform, and to pay for the repairs by refinancing their homes and wiring the proceeds into the defendants' bank account. The scheme also allegedly involved mailing flyers to potential Chicago customers advertising the company that J. Sullivan controlled as being licensed, bonded and insured when, in fact, J. Sullivan was enjoined from being involved in home repairs. Evidence of the injunction is therefore relevant to whether J. Sullivan made materially false representations, and whether he did so knowingly and with intent.
Accordingly, the motion to bar evidence of the injunction is denied.
8. Motion to Bar Evidence of Third Party Financial Transactions [108-1]
In this motion, J. Sullivan seeks to bar evidence of financial transactions undertaken by third parties. Specifically, he seeks to exclude any evidence that customers of his home repair business refinanced their homes, allegedly in order pay for the repairs. J. Sullivan contends that such evidence is irrelevant because the refinancing transactions were handled not by himself, but by third parties.
The superseding indictment alleges that, as part of the charged scheme, the defendants convinced homeowners to hire their company to perform expensive repairs and "to refinance their homes to pay for those repairs." Superseding Indictment [45-1] ¶ 3. Therefore, the relevance of the refinancing transactions turns not on the personal involvement of J. Sullivan, but rather the allegation that they were part of the scheme in which he allegedly participated.
Accordingly, the motion to bar evidence that customers refinanced their homes is denied.
9. Motion to Bar Evidence of Settled Lawsuits [109-1]
10. Motion to Bar Evidence of Complaints About Defendant's Home Repair Work [112-1]
In these motions, J. Sullivan seeks to bar evidence of lawsuits filed in state court and complaints made to the Illinois Attorney General's office, the Better Business Bureau, and similar entities, about repair work that he allegedly performed or failed to perform. J. Sullivan contends that these lawsuits and complaints are inadmissible hearsay under Federal Rules of Evidence 801 and 802, irrelevant under Rule 402, and unduly prejudicial under Rule 403. He also contends that evidence that any of the lawsuits were settled is also inadmissible to prove liability under Federal Rule of Evidence 408.
In response, the government contends that it seeks to introduce evidence of the lawsuits and complaints not to prove liability but, rather, to show intent and knowledge. For instance, the government expects to present evidence that after one victim filed suit, the defendants went to the victim's home posing as attorneys and got the victim to sign a statement that she "did not know Dan Sullivan, John Sullivan or any other Sullivan," and that the Sullivans had not tricked her into refinancing her home. In response to another lawsuit, the government expects to introduce evidence that the Sullivans directed one of their employees to go to a victim's home posing as a city inspector, and to attempt to stall the victim and his lawsuit in hopes the victim would lose his memory or die.
Thus, the proposed evidence is relevant to J. Sullivan's knowledge and intent to defraud, and is further evidence of J. Sullivan's alleged scheme. Although J. Sullivan cursorily argues that the evidence should also be excluded because it would be unduly prejudical, that argument is undeveloped and therefore forfeited. See White Eagle Cooperative Ass'n v. Conner, 553 F.3d 467, 476 n. 6 (7th Cir. 2009) (undeveloped arguments unsupported by citations to authority are forfeited).
Accordingly, the motions to exclude evidence of the lawsuits and complaints are denied. However, the court will consider giving a limiting instruction to jurors regarding the evidence of other lawsuits and complaints. If the defendant seeks to have a limiting instruction given, the parties shall confer in order to present the court with an agreed-upon instruction.
11. Motion to Bar Evidence of Alleged Use of Racial Epithets [110-1] J. Sullivan seeks to bar evidence of his alleged use of a specific racial epithet, often referred to as the "n" word. The government responds that it does not intend to elicit such evidence and, therefore, the motion is granted.
12. Motion to Bar Testimony of Jeffrey Kleinberg [118-1]
In this motion, J. Sullivan seeks to bar the government from presenting any trial testimony from Jeffrey Kleinberg. The government responds that it does not intend to call Kleinberg as a witness in its case-in-chief. Accordingly, the defendant's motion is granted, though the court will revisit the issue should the government seek to question Kleinberg for purposes of rebuttal or impeachment.
13. Motion to Bar Testimony of James Browning [119-1] Next, J. Sullivan seeks to bar the government from presenting any trial testimony from James Browning. J. Sullivan anticipates that the government will question Browning about blank contracts he allegedly obtained at the direction of co-defendant Dan Sullivan so that contracts signed by customers could later be manipulated. J. Sullivan argues that such evidence would be irrelevant as to him because Browning dealt only with Dan Sullivan.
To convict J. Sullivan of wire fraud under 18 U.S.C. § 1343, it must prove he participated in a scheme to defraud. A scheme to defraud includes not only those acts in which the defendant personally took part, but also acts taken by others in furtherance of the scheme, even acts of which J. Sullivan was unaware. See United States v. Adeniji, 221 F.3d 1020, 1026 (7th Cir. 2000) ("Allismith need not even have been aware of Adediran's identity or his specific acts in furtherance of the fraudulent scheme, so long as the evidence adequately establishes Allismith's own knowing participation in the same scheme.").
Because the anticipated testimony by Browning involves details of the scheme in which J. Sullivan alleged participated, the motion to bar Browning's testimony on the grounds of relevance is denied.
14. Motion to Bar Testimony of Stephanie Lacy [120-1] J. Sullivan seeks to bar the government from presenting testimony from Stephanie Lacy at trial. J. Sullivan contends that any testimony from Lacy would be entirely irrelevant because she "had nothing whatsoever to do with any of the transactions at issue in this case." Motion [120-1] at 1. However, the government expects her to testify that she worked as a telemarketer for the defendants and targeted homeowners on the south and west sides of Chicago to solicit home repair work. The government also expects her to testify that J. Sullivan was her boss, that he ran the day-to-day operations of the home repair company, and that her telemarketing script directed her to offer refinancing to customers.
J. Sullivan also seeks to bar as irrelevant any reference to Lacy as being a drug addict. However, J. Sullivan's alleged scheme involved targeting recovering drug addicts to be employees of the home repair business because he believed them to be easier to manipulate. Therefore, evidence that Lacy was living at a drug rehabilitation center when she was offered a job at the home repair business is relevant to the scheme in which J. Sullivan is accused of participating.
J. Sullivan also cursorily states that evidence of Lacy's addiction would be unduly prejudicial to him and should be excluded under Federal Rule of Evidence 403. But he develops no argument to explain how such evidence would unduly prejudice him and, therefore, the argument is forfeited. See White Eagle Cooperative Ass'n v. Conner, 553 F.3d 467, 476 n. 6 (7th Cir. 2009) (undeveloped arguments unsupported by citations to authority are forfeited).
The testimony anticipated from Lacy would be relevant to the allegations of wrongdoing that J. Sullivan faces and, therefore, the motion to bar her testimony is denied.
15. Motion to Bar Testimony of Joyce Love [121-1] Next, J. Sullivan seeks to bar the government from presenting testimony from Joyce Love that the defendants' home repair company targeted the elderly, females, and African-Americans.
J. Sullivan argues that Love's testimony would be "speculative musings." However, Love is entitled to testify about her first-hand experiences working as a telemarketer for the home repair company. If her calls were directed at the elderly, females, and African-Americans, then such evidence appears to be relevant to the scheme in which J. Sullivan is accused of participating. Accordingly, the portion of the motion in which J. Sullivan seeks to bar Love from testifying that her telemarketing calls were directed at the elderly, females, and African-Americans is denied. However, such testimony ...