United States v. Marcus Rosenberger , 502 F. App'x 389 ( 2012 )

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
December 17, 2012
Nos. 11-50621, 11-50632 Lyle W. Cayce
Clerk
UNITED STATES OF AMERICA
Plaintiff–Appellee
v.
MARCUS ROSENBERGER
Defendant–Appellant
Appeals from the United States District Court
for the Western District of Texas
7:10-CR-135-2
7:11-CR-60-1
Before WIENER, CLEMENT, and PRADO, Circuit Judges.
PER CURIAM*
A jury convicted Defendant–Appellant Marcus Rosenberger of conspiracy
to commit, and aiding and abetting, mail and wire fraud for his role in a
fraudulent real estate scheme. Rosenberger now appeals, bringing three claims
of error. We find no error and affirm.
*
Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
No. 11-50621, 11-50632
I. Facts & Proceedings
A. Facts
In 2009, Rosenberger and Jason Morrison went into business under the
name Vanguard Properties. Together, they conducted a fraudulent scheme to
“flip” distressed properties that were about to go into foreclosure. They would
first identify a target home and then convince the owner to deed it over to them
in exchange for their promise to prevent damage to the owner’s credit history
from a foreclosure. They would then sell the home (still subject to the original
mortgage) and pocket the proceeds, all the while doing little or nothing to
prevent foreclosure. To conceal their actions from the mortgagee, they refrained
from recording their deeds in the public records. Typically, this would result in
the mortgagee foreclosing, the new buyer being evicted, and the original owner
suffering a foreclosure on his credit history. Morrison and Rosenberger flipped
nine homes this way.
Rosenberger and Morrison divided the labor of the scheme. Morrison
would find a distressed home and convince the owner to transfer it to Vanguard,
then Rosenberger would advertise and eventually sell the home to the new
buyer. The pair nevertheless held themselves out to sellers and buyers as equal
business partners and agreed to share the profits equally.
After a dispute arose over finances, Rosenberger and Morrison divided up
their portfolio of distressed properties in October 2009. Rosenberger took total
responsibility for two of the homes in Midland, Texas, one on Harlowe Drive and
the other on Amigo Drive. He continued the scheme with respect to those two
homes, collecting payments from the buyers, failing to take any steps to prevent
foreclosure, and evading inquiries from the original owners.
B. Proceedings
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No. 11-50621, 11-50632
Rosenberger and Morrison were each indicted on one count of conspiracy,
one count of mail fraud, and ten counts of wire fraud. The substantive fraud
counts arose from communications between Morrison and the lenders and from
wire transfers from the buyers. Morrison eventually pleaded guilty; Rosenberger
was charged with aiding and abetting those counts, and he went to trial.
The government adduced the testimony of the defendant’s former business
partner that Rosenberger was very experienced in real estate transactions. The
government also called a number of the scheme’s victims who testified about
their dealings with Rosenberger. At the close of the government’s case, the
district court denied Rosenberger’s Rule 29 motion for acquittal.
Rosenberger put on an affirmative defense in which he attempted to shift
the blame to Morrison and to portray himself as an unwitting employee who
simply sold properties for Morrison. In his testimony, Morrison downplayed
Rosenberger’s role in the scheme. At the conclusion of the trial, the district court
denied Rosenberger’s renewed Rule 29 motion, and the jury convicted him on all
counts.
Rosenberger was sentenced to 33 months’ incarceration. On appeal, he
contends that (1) the evidence was not sufficient to prove the requisite mens rea
or the confection of a conspiratorial agreement, (2) the trial evidence varied
materially from the allegations of the indictment, and (3) the prosecutor made
improper comments in both opening and closing argument.1
II. Analysis
A. Standards of Review
1
After the guilty verdict, Rosenberger pleaded guilty, in a different case pending before
the same court, to one count of mail fraud arising out of an unrelated 2006 real estate
transaction. Rosenberger appeals the sentence from that conviction, contending that he should
be resentenced if he is successful in reversing his conviction in this case. As we affirm his
conviction here, that other appeal is moot.
3
No. 11-50621, 11-50632
Rosenberger preserved his challenge to the sufficiency of the evidence, so
we review that claim de novo.2 We “view all evidence, whether circumstantial
or direct, in the light most favorable to the government, with all reasonable
inferences and credibility choices to be made in support of the jury’s verdict, to
determine whether a rational trier of fact could have found the essential
elements of the crime beyond a reasonable doubt.”3 “The evidence need not
exclude every reasonable hypothesis of innocence or be wholly inconsistent with
every conclusion except that of guilt, in order to be sufficient.”4 Thus,
Rosenberger “faces an imposing standard of review.”5
Rosenberger did not, however, object to a material variance between the
evidence and the indictment or to any remarks by the prosecutor. We therefore
review these points for plain error.6 To show plain error, he must demonstrate
that the error was clear or obvious and affected his substantial rights.7 “Even
if he meets this tough standard, we will not reverse unless the error has a
serious effect on the fairness, integrity, or public reputation of judicial
proceedings.”8
B. Sufficiency of the Evidence
To prove conspiracy to commit mail fraud and wire fraud, the government
must show an agreement between the defendant and another to commit those
2
United States v. Grant, 683 F.3d 639, 642 (5th Cir. 2012).
3
Id. (internal quotation marks omitted).
4
Id. (internal quotation marks omitted).
5
United States v. Aubin, 87 F.3d 141, 144 (5th Cir. 1996) (internal quotation marks
omitted).
6
United States v. McCullough, 631 F.3d 783, 793 (5th Cir. 2011).
7
E.g., United States v. Barlow, 568 F.3d 215, 219 (5th Cir. 2009).
8
Id. (internal quotation marks omitted).
4
No. 11-50621, 11-50632
crimes.9 The agreement “need not be shown to have been explicit” and “can
instead be inferred from the facts and circumstances of the case.”10 To prove
both conspiracy and aiding and abetting mail and wire fraud, the government
must show an intent to defraud.11 “Circumstantial evidence can be sufficient to
prove fraudulent intent in mail and wire fraud cases.”12 “Typically, the same
evidence will support both a conspiracy and an aiding and abetting conviction.”13
Rosenberger challenges the sufficiency of the evidence regarding the
requisite intent to defraud and the existence of a conspiratorial agreement
between him and Morrison. He claims that Morrison’s testimony exculpated him
and that the circumstantial evidence was at least as consistent with his version
of the facts as with the government’s version. Rosenberger insists that his
convictions must be reversed because evidence equally consistent with
fraudulent or innocent intent cannot sustain a fraud conviction as a matter of
law.14
When we review the record under the appropriate standard of review, we
are satisfied that the jury had ample circumstantial evidence from which to infer
a conspiratorial agreement and intent to defraud. Rosenberger and Morrison
intended to share their ill-gotten gains equally and held themselves out as
business partners while perpetuating the fraud. Even if their division of labor
9
United States v. Ingles, 445 F.3d 830, 838 (5th Cir. 2006).
10
Iannelli v. United States, 420 U.S. 770, 777 n.10 (1975).
11
See Ingles, 445 F.3d at 838; United States v. Rivera, 295 F.3d 461, 466 (5th Cir.
2002).
12
Crowe v. Henry, 115 F.3d 294, 297 (5th Cir. 1997).
13
United States v. Vasquez, 677 F.3d 685, 695 (5th Cir. 2012) (internal quotation marks
omitted).
14
See United States v. Reveles, 190 F.3d 678, 686 (5th Cir. 1999) (“When the evidence
is in equipoise, as a matter of law it cannot serve as the basis of a finding of knowledge.”).
5
No. 11-50621, 11-50632
within the conspiracy kept Rosenberger from knowing all of the details of
Morrison’s role, a finding of fraudulent intent or conspiratorial agreement is not
precluded.15 Moreover, the jury heard ample evidence from which to infer
Rosenberger’s guilty mind. As the record unequivocally establishes that
Rosenberger was a sophisticated and experienced real estate entrepreneur, the
jury easily could have concluded that he could not have been deceived or misled
by Morrison about the nature of their business or otherwise have been unaware
of its true nature. And numerous sellers and buyers who were victims of the
scheme testified regarding communications with Rosenberger that negate any
inference of innocence or obliviousness. In particular, Rosenberger’s actions
with respect to the Harlowe Drive and Amigo Drive properties after he and
Morrison split in October 2009 were entirely consistent with the scheme. On the
totality of the evidence, the jury could have concluded beyond a reasonable doubt
that Rosenberger knew what was going on all along.
Although Morrison’s testimony could have undermined a finding of
Rosenberger’s fraudulent intent, the jury did not have to believe it. Morrison
was impeached by his guilty pleas to unrelated charges of burglary and failure
to register as a sex offender, as well as by the charges arising out of his dealings
with Rosenberger and the victims of their fraud. Indeed, if Rosenberger had
lacked fraudulent intent, then Morrison would have had no one with whom to
conspire. The jury acted well within the confines of logic and the law by
rejecting that testimony.
15
United States v. Sneed, 63 F.3d 381, 385-86 (5th Cir. 1995) (“The members of a
conspiracy which functions through a division of labor need not be privy to the details of each
aspect of the conspiracy.”) (alteration and internal quotation marks omitted).
6
No. 11-50621, 11-50632
In short, Rosenberger has not overcome the imposing burden of sufficiency
review. Viewing all evidence in the light most favorable to the verdict, the
record supports affirmance.16
C. Material Variance
Rosenberger also contends that the trial evidence materially varied from
the allegations of the indictment because his handling of the homes on Harlowe
Drive and Amigo Drive after October 2009 was not charged as an overt act. “A
material variance occurs when the proof at trial depicts a scenario that differs
materially from the scenario charged in the indictment but does not modify an
essential element of the charged offense.”17 A variance is material if it prejudices
the defendant’s substantial rights by surprising him at trial.18
The indictment charged a conspiracy lasting from March 2009 to March
2010 and affecting the Harlowe Drive and Amigo Drive properties, among
others. Thus, Rosenberger could not have been surprised at trial by evidence
pertaining to those properties during that period. Moreover, his conduct was
entirely consistent with the charged scheme, not at variance with it. Although
the discrete facts were not specifically articulated in detail in the indictment,
“the government is not limited to the overt acts pleaded in the indictment in
16
For the same reasons, we reject Rosenberger’s alternative request for a new trial,
under 28 U.S.C. § 2106. Even assuming that we could grant a new trial despite Rosenberger’s
failure to request one pursuant to Federal Rule of Criminal Procedure 33, see United States v.
Nguyen, 507 F.3d 836, 838-39 (5th Cir. 2007), we perceive no basis for such relief, see United
States v. Wright, 634 F.3d 770, 775 (5th Cir. 2011) (“In this Circuit, the generally accepted
standard is that a new trial ordinarily should not be granted unless there would be a
miscarriage of justice or the weight of evidence preponderates against the verdict.”) (internal
quotation marks omitted).
17
United States v. Mitchell, 484 F.3d 762, 769 (5th Cir. 2007) (internal quotation marks
and citation omitted).
18
United States v. Valencia, 600 F.3d 389, 432 (5th Cir. 2010).
7
No. 11-50621, 11-50632
proving a conspiracy, but may show other acts of conspirators occurring during
its life.”19 We perceive no error.
D. Improper Prosecutorial Remarks
Finally, Rosenberger raises a number of purportedly improper
prosecutorial comments, none of which he objected to at trial. Reviewing for
plain error, we find none.
First, Rosenberger challenges a remark touching on his constitutional
right not to testify at trial. The Fifth Amendment prohibits a remark if “the
prosecutor’s manifest intent in making the remark must have been to comment
on the defendant’s silence, or the character of the remark must have been such
that the jury would naturally and necessarily construe it as a comment on the
defendant's silence.”20 “The prosecutor’s intent is not manifest if there is some
other, equally plausible explanation for the remark.”21
We begin by examining the challenged remark in full context.22 At trial,
the government introduced and played recordings of telephone conversations
involving Rosenberger, and he did not object. The jury thus had the opportunity
to hear him speak and to draw inferences about his mental capabilities. In
closing argument, defense counsel suggested to the jury that Morrison had taken
advantage of Rosenberger’s limited faculties. To refute this argument, the
prosecutor referred the jury to the recordings:
Don’t be misled. Don’t be fooled by this notion that, “Gee, I
just don’t know”; he’s just a fourth grader; he doesn’t know.
19
United States v. Carlock, 806 F.2d 535, 550 (5th Cir. 1986).
20
Cotton v. Cockrell, 343 F.3d 746, 751 (5th Cir. 2003) (internal quotation marks
omitted).
21
Id.22
See id. (“[C]hallenged comments are evaluated in the context of the trial within which
they are made.”).
8
No. 11-50621, 11-50632
You heard recordings of Mr. Rosenberger. He does not have
to take the stand. It’s not his burden. It’s my burden. But you had
an opportunity to listen to him on the recordings, and you can make
that judgment for yourself.
Does he sound like any fourth grader you’ve ever met? Or
does he sound like a grown man who knows what he’s talking
about?
Read as a whole, the prosecutor’s remarks were directed at the recorded
speech that the jury actually heard, not at Rosenberger’s silence. This is a
plausible explanation for the remark, negating any manifest intent to comment
on Rosenberger’s silence. Neither is the remark one that the jury would
necessarily construe as commenting on Rosenberger’s silence. But, even if we
were to take a narrower view and conclude that alluding to Rosenberger’s right
to remain silent was unnecessary and improper, any conceivable prejudice to
Rosenberger was negligible at most and could not have affected his substantial
rights.23
Neither can we conclude that the rest of the remarks of which Rosenberger
complains constituted error, much less reversible plain error. The record
supports the prosecutor’s remarks about Rosenberger’s real estate acumen and
mathematical skill, and about his limitations in other areas. The prosecutor’s
reference to a witness’s military service was relevant in the context of the trial
and cannot plausibly be interpreted as bolstering that witness’s credibility. And,
the references to the sub-prime mortgage market and to achieving justice for
Rosenberger’s victims fall well short of any realistic likelihood of prejudice.24
23
See United States v. Delgado, 672 F.3d 320, 337 (5th Cir. 2012); see also United States
v. McMillan, 600 F.3d 434, 452 (5th Cir. 2010) (finding no error “even if we assume that the
prosecutor’s comments improperly reflected on the defendants’ failure to testify” because “the
comments were more an isolated remark than a call for the jury to focus on the fact that the
defendants did not testify”).
24
Rosenberger’s reliance on United States v. Payne, a Sixth Circuit case, is misplaced
because of its significantly more egregious facts. 2 F.3d 706, 714 (6th Cir. 1993) (reversing
conviction because of prosecutor’s “calculated effort used to evoke strong sympathetic emotions
9
No. 11-50621, 11-50632
In summary, we affirm Rosenberger’s convictions and sentences on all
counts.
AFFIRMED.
for Christmas-time activity, the poor, pregnant women, diaperless children, and laid-off
employees”).
10