Demond, Walter, PD-1636-14

Background

Walter Demond, a longtime outside counsel to Pedernales Electric Cooperative (PEC), followed directions of PEC general manager Bennie Fuelberg in hiring/engaging consultants (including Fuelberg’s brother Curtis and board member’s son William Price).
Fuelberg had plenary authority as general manager to hire outside consultants and lawyers under PEC governance.
State prosecuted Fuelberg and Demond; Demond was convicted of theft by deception (among other charges later addressed by the court of appeals). The Third Court of Appeals reversed the theft-by-deception conviction for legal insufficiency.
The court of appeals concluded the State’s evidence failed to prove that any alleged deception actually affected PEC’s judgment to pay Curtis and Price—an essential element of theft by deception under Tex. Penal Code §§ 31.01, 31.03.
The State sought discretionary review asking reversal of the court of appeals’ sufficiency ruling and alternatively argued Demond could be liable under the law-of-parties doctrine; Demond (through counsel) filed a response urging denial of review on the theft issue while urging review of other aspects of the case.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Sufficiency of evidence for theft by deception	Evidence (circumstantial testimony of PEC directors and staff) suffices to show deception induced PEC to pay consultants	Evidence is insufficient: record lacks proof PEC’s judgment to pay was affected; circumstantial evidence cannot bridge that gap	Court of appeals: Reversed—no rational factfinder could find inducement/affected judgment beyond reasonable doubt
Standard of review applied by court of appeals	Court improperly minimized circumstantial evidence, raising prosecutorial burden	Court properly reviewed evidence in light most favorable to verdict and assessed adequacy (quality v. quantity)	Court of appeals applied correct legal sufficiency standard (Brooks v. State framework)
Application of law-of-parties doctrine	Even if Demond did not directly induce PEC, he is criminally responsible as a party for Fuelberg’s conduct	Law of parties cannot apply because no underlying offense was proven to have been committed by Fuelberg either	Law of parties inapplicable—requires an underlying committed offense; court found no proven inducement by either actor
Whether reversal threatens prosecutors’ ability to rely on circumstantial evidence	State contends decision raises impossibly high bar and undermines use of circumstantial proof in theft-by-deception cases	Defense notes the court in fact presumed intent from circumstantial evidence but found inducement/affected judgment lacking; other cases similarly require victim testimony or proof on inducement element	Court’s decision is case-specific; does not categorically preclude circumstantial evidence but finds the record here inadequate

Key Cases Cited

Brooks v. State, 323 S.W.3d 893 (Tex. Crim. App. 2010) (standard for reviewing legal sufficiency — quality over quantity)
Roberts v. State, 319 S.W.3d 37 (Tex. App.—San Antonio 2010) (affirmed deception conviction where victim testimony supported inducement)
Ehrhardt v. State, 334 S.W.3d 849 (Tex. App.—Texarkana 2011) (circumstantial evidence may prove intent but may be insufficient to show deception affected victim’s final payment)
Swope v. State, 805 S.W.2d 442 (Tex. Crim. App. 1991) (law of parties principles applied where an underlying offense was committed)
King v. State, 17 S.W.3d 7 (Tex. App.—Houston [14th Dist.] 2000) (theft-by-deception affirmed where underlying inducement shown)