Demond, Walter
PD-1636-14
| Tex. App. | Feb 4, 2015Background
- Walter Demond, a partner at Clark, Thomas & Winters, represented Pedernales Electric Cooperative (PEC). He and PEC general manager Bennie Fuelberg allegedly funneled PEC funds through the firm to Fuelberg’s brother Curtis and to William Price.
- Payments were concealed by vague or misleading law-firm billing entries (block billing, mislabeling as "legal/regulatory" services) so the PEC accounting/board would not see the true recipients.
- PEC later investigated; indictments charged Demond (and Fuelberg) with misapplication of fiduciary property, theft by deception, and money laundering.
- A jury convicted Demond of misapplication (reduced to second-degree), theft by deception (first-degree), and money laundering (second-degree); sentences were suspended and community supervision conditions included county-jail time.
- On appeal the Third Court of Appeals affirmed misapplication and money laundering, reversed and vacated the theft-by-deception conviction for insufficient evidence, modified community-supervision conditions, and rejected other defense claims (recusal, juror removal). The State petitioned for review on the theft issue.
Issues
| Issue | Plaintiff's Argument (State) | Defendant's Argument (Demond) | Held |
|---|---|---|---|
| Sufficiency of evidence for theft by deception | Demond’s deceptive billing induced PEC to reimburse Clark Thomas; circumstantial evidence and law of parties suffice to prove deception-induced consent | No direct testimony that PEC would have refused payments if it had known; deception did not materially affect board’s decision | Court of Appeals: evidence insufficient for theft by deception; reversed and vacated that conviction |
| Misapplication of fiduciary property (party liability) | State: Fuelberg misapplied PEC funds; Demond aided/encouraged the scheme and is criminally responsible as a party | Demond: Fuelberg had authority to hire consultants; any value received defeats misapplication/theft | Court: evidence supports misapplication conviction on party theory; conviction affirmed (second-degree) |
| Money laundering — when funds become "proceeds" | State: funds became proceeds when PEC transferred them to Clark Thomas; Demond’s transfer to Curtis/Price was laundering of those proceeds | Demond: misapplication not complete until funds reached Curtis/Price, so earlier transfers could not be proceeds for laundering | Court: funds became proceeds when PEC lost control (to Clark Thomas); money-laundering conviction affirmed |
| Community-supervision jail "stacking" and juror removal | State: trial court may impose up to 180 days per felony conviction as condition of community supervision; trial court’s juror-disability determination was within discretion | Demond: total jail condition exceeded statutory 180‑day limit; juror’s illness was temporary so removal was error | Court: follows precedent allowing 180 days per felony (modified to remove vacated theft term); juror dismissal for disability not an abuse of discretion |
Key Cases Cited
- Clayton v. State, 235 S.W.3d 772 (Tex. Crim. App.) (standard for reviewing legal sufficiency of evidence)
- Matchett v. State, 941 S.W.2d 922 (Tex. Crim. App.) (appellate role not to reweigh evidence)
- Swope v. State, 805 S.W.2d 442 (Tex. Crim. App.) (theft-by-deception and party liability principles)
- Daugherty v. State, 387 S.W.3d 654 (Tex. Crim. App.) (deception-induced consent must be a substantial or material factor)
- Allen v. United States, 76 F.3d 1348 (5th Cir.) (funds become proceeds when they leave victim control for laundering analysis)