State v. Buttars, 468 P.3d 553

Background

David Buttars co-founded Ellipse (later MovieBlitz) and raised over $815,000 from individual investors while representing funds would be used to develop a kiosk/memory-key product; company accounts were underfunded and investor funds were frequently transferred to Buttars’s personal account and used for personal expenses.
The State’s investigator obtained investigative subpoenas for bank records from Frontier Community Bank and JP Morgan Chase; the subpoenas included secrecy language; Chase produced records with proper custodial certification, Frontier produced multiple batches but lacked adequate custodial certificates.
The district court ruled Frontier records were not authenticated under the business‑records exception (Utah R. Evid. 803(6)/902(11)) but admitted the Frontier records and the State’s Expert summaries/cover sheets under the residual hearsay exception (Utah R. Evid. 807); the Expert testified using those summaries and offered evaluative labels (e.g., "questionable," "commingled").
The jury convicted Buttars of four counts of securities fraud and one count of pattern of unlawful activity (acquitted on theft counts); Buttars appealed contesting admission of the bank records/summaries and suppression ruling regarding subpoenas’ secrecy language.
The Utah Court of Appeals reversed and remanded for a new trial, holding the Frontier records should not have been admitted under Rule 807 because the business‑records exception was the appropriate rule and the State failed to show exceptional circumstances warranting the residual exception; the error was prejudicial.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether bank records could be admitted under the residual hearsay exception (Utah R. Evid. 807) despite failing business‑records authentication	The State: records and summaries were trustworthy and admissible under Rule 807; summaries were necessary and probative	Buttars: Frontier records were hearsay without custodial certification and thus inadmissible; summaries dependent on inadmissible records	Reversed: Bank records should not have been admitted under Rule 807 because the business‑records rule (803(6)/902(11)) specifically governs such records and State showed no exceptional circumstances to justify Rule 807 use
Whether summaries/cover sheets and Expert labels were admissible under Rule 1006 / as substantive evidence	The State: summaries accurately reflected underlying records and were admissible; cover sheets aided jury	Buttars: summaries impermissibly brought inadmissible hearsay in; cover‑sheet opinions exceeded allowed content of a Rule 1006 summary	Held: Summaries cannot stand if underlying records are inadmissible; cover‑sheet notations (opinion) exceed Rule 1006’s role and are not substantive proof
Whether admission of Frontier records was prejudicial	The State: any error harmless because records could have been authenticated or Chase records sufficed	Buttars: Frontier records were critical to prove misuses and underfunding; without them conviction unlikely	Held: Admission was prejudicial — Frontier records were central and their erroneous admission created a reasonable likelihood of a different outcome
Whether subpoenas’ secrecy language warranted suppression of records (constitutional/statutory challenge)	Buttars: secrecy language violated statute and constitution, so records should be suppressed	State: statutory inclusion was error but did not make subpoenas invalid; no showing Buttars could have quashed subpoenas or that exclusion was required	Held: Statutory error was technical; suppression not warranted absent a showing of prejudice or a likely successful quash motion

Key Cases Cited

State v. Nelson, 777 P.2d 479 (Utah 1989) (residual exception is for rare, exceptional circumstances where statements have equivalent guarantees of trustworthiness)
State v. Clopten, 362 P.3d 1216 (Utah 2015) (interpreting Rule 807 and its limited use)
State v. Webster, 32 P.3d 976 (Utah Ct. App. 2001) (residual hearsay exception should be used very rarely)
State v. Workman, 122 P.3d 639 (Utah 2005) (Rule 807 is to be construed strictly)
Sunridge Dev. Corp. v. RB & G Eng'g, Inc., 305 P.3d 171 (Utah Ct. App. 2013) (a summary cannot be a vehicle for admitting inadmissible hearsay; underlying records must be admissible)
International Harvester Credit Corp. v. Pioneer Tractor & Implement, Inc., 626 P.2d 418 (Utah 1981) (documentary summaries and hearsay rules both must be satisfied)
State v. Knight, 734 P.2d 913 (Utah 1987) (harmless error/prejudice standard: conviction reversed if reasonable likelihood of a more favorable result absent error)
State v. Perea, 322 P.3d 624 (Utah 2013) (distinguishing substantive evidence from demonstrative aid)