United States District Court, W.D. Virginia, Harrisonburg Division
Michael F. Urbanski United States District Judge
Before the court are renewed motions for judgment of acquittal filed pursuant to Rule 29 of the Federal Rules of Criminal Procedure by defendants Richard Shelton Fowler (ECF No. 215) and Steven Maurice Pemberton (ECF No. 217). On July 21, 2015, Pemberton, Fowler, and three other defendants-Leondra Sykes, Alexander Ayanou, and David Yarborough-were charged in a six-count superseding indictment arising from the alleged use of stolen credit card numbers to make fraudulent purchases of household goods. Specifically, the superseding indictment charged Pemberton with conspiracy to engage in credit card fraud in violation of 18 U.S.C. §§ 1029(a) (2) v (a)(5), and (b)(2) (Count 1), attempted credit card fraud in violation of 18 U.S.C. §§ 1029(a)(5), (b)(1), (c)(l)(A)(ii), and 2 (Count 3), and two counts of aggravated identity theft in violation of 18 U.S.C. §§ 1028A(a)(l), (c)(4), and 2 (Counts 4 and 5). Fowler was charged with conspiracy (Count 1), a separate count of attempted credit card fraud (Count 2), and three counts of aggravated identity theft (Counts 4, 5, and 6).
Pemberton, Fowler, and Ayanou proceeded to trial on August 3, 2015. At the close of the government's evidence, defendants moved for a judgment of acquittal on all charges. ECF No. 187. The court granted the defendants' motions to dismiss Counts 2 and 3, but reserved decision on Counts 1, 4, and 5. ECF No. 190. The defendants renewed their Rule 29 motions at the close of trial. Id. The court continued to reserve decision, and submitted the three remaining counts to the jury. Id. The jury returned a verdict finding Fowler guilty on Counts 1, 4, and 5 but could not reach a verdict as to Pemberton on any count. Ayanou was acquitted on all counts. After the jury returned its verdict, counsel for Fowler requested a poll of the individual jurors pursuant to Federal Rule of Criminal Procedure 31(d). The poll revealed a lack of unanimity as to the jury's verdict, and the court declared a mistrial as to Pemberton and Fowler. ECF No. 208. Pemberton and Fowler then submitted written briefs in support of their motions for acquittal on Counts 1, 4, and 5, and the court heard oral argument on October 22, 2015. For the reasons set forth below, both motions are DENIED.
Rule 29 of the Federal Rules of Criminal Procedure states that, "[a]fter the government closes its evidence or after the close of all the evidence, the court on the defendant's motion must enter a judgment of acquittal of any offense for which the evidence is insufficient to sustain a conviction." Fed. R. Crim. P. 29(a). The Rule further provides that a court can reserve decision on a motion for acquittal until after the jury returns a verdict or is otherwise discharged. Fed. R. Crim. P. 29(b). When, as here, the court reserves decision on a Rule 29 motion made at the close of the government's case, the court "must decide the motion on the basis of the evidence at the time the ruling was reserved." Fed. R. Crim. P. 29(b).
"A judgment of acquittal based on the insufficiency of evidence is a ruling by the court that as a matter of law the government's evidence is insufficient 'to establish factual guilt' on the charges in the indictment." United States v. Alvarez. 351 F.3d 126, 129 (4th Cir. 2003) (quoting Smalis v. Pennsylvania. 476 U.S. 140, 144 (1986)). "The test for deciding a motion for a judgment of acquittal is whether there is substantial evidence (direct or circumstantial) which, taken in the light most favorable to the prosecution, would warrant a jury finding that the defendant was guilty beyond a reasonable doubt." United States v. MacCloskey. 682 F.2d 468, 473 (4th Cir. 1982). "[Substantial evidence is evidence that a reasonable finder of fact could accept as adequate and sufficient to support a conclusion of a defendant's guilt beyond a reasonable doubt." United States v. Burgos. 94 F.3d 849, 862 (4th Cir. 1996). Accordingly, a court must deny a defendant's motion if the evidence presented at trial, viewed in the light most favorable to the government, is sufficient for a rational juror to find each element of the offense beyond a reasonable doubt. United States v. United Med. & Surgical Supply Corp.. 989 F.2d 1390, 1402 (4th Cir. 1993) (citing Jackson v. Virginia. 443 U.S. 307, 319 (19791): see also United States v. Friske. 640 F.3d 1288, 1290-91 (11th Cir. 2011) ("In reviewing a sufficiency of the evidence challenge, we consider the evidence in the light most favorable to the [g]overnment, drawing all reasonable inferences and credibility choices in the [government's favor.").
Defendants first argue that there is insufficient evidence to support a conviction on Count 1, which charges conspiracy to engage in credit card fraud. Defendants claim that there is no evidence showing that they knew of the conspiracy described in Count 1, much less that they knowingly and voluntarily joined any unlawful agreement. Defendants also challenge the credibility of key government witnesses, and urge the court to ignore their testimony.
Defendants raise similar arguments for Counts 4 and 5. For these counts, the government alleges that defendants aided and abetted commission of aggravated identity theft, and are otherwise liable as co-conspirators under Pinkerton v. United States. 328 U.S. 640 (1946). As to aiding and abetting liability, defendants claim there is no evidence they knowingly aided or abetted another's commission of aggravated identity theft or intended for that crime to take place. Likewise, defendants claim Pinkerton liability is inapplicable because the government failed to show that they were members of a conspiracy to commit credit card fraud or that the commission of aggravated identity theft was reasonably foreseeable to them. The court will address each argument in turn.
A. Count 1
Count 1 alleges a conspiracy in which individuals used stolen credit card numbers to purchase household goods from various home improvement stores. One defendant-David Yarborough-illegally obtained a series of credit card numbers from victims in and around Washington, D.C., which he then sold to Renodo Taylor. Taylor used the stolen numbers to purchase merchandise online or via phone from stores in Pennsylvania, Maryland, Virginia, North Carolina, and West Virginia. Taylor allegedly contracted with various individuals-including Pemberton and Fowler--to deliver this merchandise to the buyers Taylor identified. Occasionally, goods would be stored at Eagle Haulers, a Maryland storage facility owned by Fowler, before being delivered to one of Taylor's customers.
To meet its burden on Count 1, the government must prove: (1) that an agreement existed between two or more criminally culpable persons to commit credit card fraud; (2) that the defendants knew of the unlawful agreement; (3) that the defendants knowingly and voluntarily became a part of the unlawful agreement; (4) that at least one overt act was taken in furtherance of the unlawful agreement; and (5) that the unlawful agreement affected interstate commerce. As with any conspiracy, the government need not offer direct evidence of an agreement to commit, credit card fraud. "By its very nature, a conspiracy is clandestine and covert, thereby frequently resulting in little direct evidence of such an agreement." United States v. Burgos. 94 F.3d 849, 857 (4th Cir. 1996). "Hence, a conspiracy generally is proved by circumstantial evidence and the context in which the circumstantial evidence is adduced." Id. "Circumstantial evidence tending to prove a conspiracy may consist of a defendant's 'relationship with other members of the conspiracy, the length of this association, the defendant's attitude and conduct, and the nature of the conspiracy.'" United States v. Yearwood. 518 F.3d 220, 226 (4th Cir. 2008) (citing Burgos. 94 F.3d at 858). Moreover, "a member of a conspiracy may not know its full scope or partake in its full range of activities." United States v. Leonard. 777 F.Supp.2d 1025, 1033 (W.D. Va. 2011). Thus, "the evidence need only establish a slight connection between a defendant and the conspiracy to support conviction." United States v. Green. 599 F.3d 360, 367 (4th Cir. 2010).
1. Evidence of Fowler's Role in the Conspiracy
Fowler focuses on the second and third elements of conspiracy, arguing that there is no evidence he knew about the stolen credit card numbers, nor that he knowingly and voluntarily became a part of a conspiracy to commit credit card fraud. The government counters that multiple witnesses testified to Fowler's role in the conspiracy, including one witness who testified that Fowler knew about the stolen card numbers. The government also points to circumstantial evidence of Fowler's knowledge, including his attempts to avoid detection by police, the unusually high prices he charged to transport and store Taylor's goods, and discrepancies in multiple invoices recovered from Eagle Haulers. The government argues that this evidence, when viewed in the light most favorable to the prosecution, is sufficient for a reasonable juror to convict Fowler on Count 1. The court agrees.
The government's key witness against Fowler was Renodo Taylor, the alleged leader of the conspiracy. Taylor testified that he arranged for Fowler and Eagle Haulers to store merchandise he purchased with the stolen credit card numbers. Trial Tr., Aug. 5, 2015, ECF No. 233, at 19:17- 21:10. These items included generators, hardwood floors, appliances, lawnmowers, and other household goods. Id. at 21:8-10. In some cases, Fowler would personally pick up and transport the goods to Eagle Haulers. Id. at 20:23-25. Other times, Fowler would accept delivery from third-party drivers, either paying the drivers with money provided by Taylor or paying them with his own funds and later seeking reimbursement from Taylor. Id. at 22:14-17. These deliveries were made at a parking lot located a few blocks from Eagle Haulers or directly at the Eagle Haulers warehouse. Id. at 22:1-25. Taylor would usually initiate the pick-ups himself, but Fowler would also contact Taylor directly to arrange deliveries when Fowler was returning to Eagle Haulers from other work. Id-at 33:5-13.
Taylor testified that Fowler would either store the items at Eagle Haulers until Taylor could find a buyer, or sell the items himself and pay Taylor a percentage of the sales price. Id. at 21:3- 21:25. Fowler charged approximately $500.00 to store the merchandise for a few days. Id. at 21:3-16. If Fowler made the pickup himself, he charged approximately $1, 000.00. Id. at 22:24-23:7. Taylor testified that, over time, Fowler demanded more money because of "the risk" involved. Id. at 61:9-62:1.
Other witnesses confirm that Fowler played an active role in storing merchandise Taylor purchased with the stolen credit card numbers. For example, Leondra Sykes testified that he was hired by Taylor-who he knew only as the "broker"-to pick up and deliver goods to various locations, including Eagle Haulers. Trial Tr., Aug. 5, 2015, ECF No. 234, at 7:6-11:1. Sykes testified that Fowler was present when he delivered goods to Eagle Haulers. Id. at 10:21-12:10. He also stated that he provided Fowler with the invoice for the merchandise, and would receive a cash payment from Fowler for his work. Id. at 11:14-21. On at least one occasion, Fowler gave Sykes a written receipt for his $1, 000.00 delivery fee. Id- at 17:10-16.
A third witness, Special Agent Chad Laub of the United States Secret Service, provided details about similar invoices and receipts he discovered during a search of the Eagle Haulers warehouse. Agent Laub testified that he connected a number of the invoices found at Eagle Haulers with unauthorized purchases made on multiple credit accounts. Trial Tr., Aug. 4, 2015, ECF No. 250, at 111:11-122:25. Agent Laub noted that the names and addresses on the invoices appeared to be phony, and did not match those of the account holders whose card numbers were used to make the purchase. Id. Agent Laub then linked these false identities with Taylor, describing how Taylor would use the same phony names and addresses in multiple transactions using different card numbers. Id. Some of these transactions involved goods that were later delivered to Fowler at Eagle Haulers. Id. Finally, Agent Laub testified that he observed a notice posted in the Eagle Haulers warehouse that described the company's standard moving and storage rates. Id. at 111:7- 10. The rates Fowler charged to transport and store Taylor's goods were significantly higher than these posted rates. Id. at 114:3-16.
Most importantly, the government offered evidence that Fowler knew about the stolen credit card numbers. For example, Taylor testified that he asked Fowler to steal new credit card numbers from customers at Eagle Haulers, but that Fowler declined because he no longer accepted credit cards at his business. Trial Tr., Aug. 5, 2015, ECF No. 233, at 23:14-17. Taylor also testified that Fowler expressed concerns about the delivery drivers Taylor used to transport goods to Eagle Haulers, telling Taylor he worried they might be working with law enforcement. Id. at 22:18-23. In addition, Taylor recounted a conversation in which Fowler bragged about a "contact" he had with the police who could help get Fowler out of trouble. Id. at 23:18-22. Taylor later described a specific instance in York, Pennsylvania when Fowler's "contact" helped him avoid arrest after the police began investigating a delivery Fowler made on Taylor's behalf. Id. at 23:18-24:13.
Even more significant is Taylor's testimony that he told Fowler directly that stolen credit cards were being used. During direct ...