United States v. John Westine, Jr.
883 F.3d 659
| 6th Cir. | 2018Background
- Defendants John Westine and Henry Ramer ran a multi‑phase scheme selling interests in purported oil and gas projects (Phase I → Phase II → Phase III) that produced little or no oil; investors never received promised royalties.
- Westine previously served a long prison term for a similar oil/gas securities fraud and used multiple aliases and virtual offices; Ramer ran California call centers, recruited investors, and helped conceal identities and prior regulatory actions.
- The government tried Westine and Ramer separately on counts including mail fraud (18 U.S.C. § 1341), conspiracy to commit money laundering (18 U.S.C. § 1956(h)), and securities fraud (15 U.S.C. § 78j(b)); juries convicted both; Westine received 480 months, Ramer 156 months.
- District court admitted prior‑acts and regulatory sanction evidence (Rule 404(b)) to prove identity, knowledge, intent, and absence of mistake; limited jury instruction given on purpose of that evidence.
- Defendants moved for new trials based on later‑disclosed civil investigative material showing co‑conspirator Mark Cornell ran a separate ‘‘side deal’’; district court denied relief as the material was cumulative and immaterial in light of overwhelming evidence.
- On appeal the Sixth Circuit affirmed convictions and sentences, rejecting challenges to prior‑acts admission, alleged Brady/newly discovered evidence, hearsay and business‑records rulings, expert testimony, Phase I evidence relevance, sufficiency of evidence, and Guidelines calculations.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Admissibility of prior‑acts evidence (Rule 404(b)) | Govt: prior acts prove identity, intent, knowledge, absence of mistake | Defs: evidence was propensity evidence and unduly prejudicial | Admitted — probative for identity, intent, knowledge; jury instruction mitigated prejudice; no abuse of discretion (affirmed) |
| New trial / Brady based on Cornell civil file | Defendants: unrevealed civil file was Brady/newly discovered material that would undermine Cornell’s credibility and alter outcome | Govt: file cumulative; disclosed portions not material; no Brady violation shown | Denied — evidence immaterial/cumulative vis‑à‑vis overwhelming independent proof; no reasonable probability of different result |
| Hearsay / business records (Rule 803(6)) | Defs: various statements and bank records were inadmissible hearsay | Govt: statements admissible under exceptions/res gestae; bank records authenticated by qualified witness and summaries under Rule 1006 | No plain‑error (Westine) and no reversible error (Ramer): hearsay objections failed; bank records properly authenticated by DFI witness and admissible |
| Expert testimony and reliability | Govt: expert relied on decades of production data and field experience | Ramer: underlying production reports were self‑reported/unreliable | Testimony admissible — factual basis sufficient; attacks go to weight not admissibility; forfeiture/plain‑error review fails |
| Relevance of Phase I evidence to Ramer | Govt: Phase I shows the enterprise and money movement Ramer joined | Ramer: he wasn’t involved in Phase I; Phase I only served to prejudice Phases II/III | Admissible — Phase I relevant to proving existence of enterprise and foreseeable mailings and money‑laundering conspiracy; not excluded as irrelevant |
| Sufficiency of evidence (securities & mail fraud) | Govt: instruments fall within statutory definitions of securities; mailings were in furtherance of scheme | Westine: contracts were not securities or mailings were legitimate/attributable to JMack only | Convictions supported — contracts qualify as securities under statute; mailings could be viewed as incident to and in furtherance of the scheme |
| Sentencing enhancements (TRO violation, relocation, sophisticated means, loss) | Govt: enhancements supported by TRO violation, relocations to evade detection, complex concealment, and loss calculations tied to timeframe of Ramer’s involvement | Defs: TRO not "prior" to charged conduct; relocations/ sophistication, and loss amount overstated or misattributed | Affirmed — district court’s factual findings not clearly erroneous; legal applications proper; loss estimate reasonable and limited to post‑August 2013 investments attributable to Ramer |
Key Cases Cited
- United States v. White, 492 F.3d 380 (6th Cir. 2007) (standard for reviewing evidentiary rulings)
- United States v. Churn, 800 F.3d 768 (6th Cir. 2015) (Rule 404(b) analysis)
- United States v. Mack, 258 F.3d 548 (6th Cir. 2001) (proper purposes for other‑acts evidence)
- United States v. Woods, 613 F.2d 629 (6th Cir. 1980) (identity via distinctive signature‑like conduct)
- United States v. Coffman, [citation="574 F. App'x 541"] (6th Cir. 2014) (authentication of bank records by qualified non‑bank witness)
- United States v. Warshak, 631 F.3d 266 (6th Cir. 2010) (mail fraud: mailings in ordinary course or incident to scheme)
- United States v. Frost, 125 F.3d 346 (6th Cir. 1997) (mail fraud foreseeability/ordinary course rule)
- SEC v. W.J. Howey Co., 328 U.S. 293 (1946) (investment‑contract test — note: statute here made Howey unnecessary for statutory securities)
- Bagley v. United States, 473 U.S. 667 (1985) (Brady materiality standard)
- Kyles v. Whitley, 514 U.S. 419 (1995) (reasonable probability standard undermining confidence)