Case Information
*1
[Cite as
State v. Castile
,
IN THE COURT OF APPEALS OF OHIO TENTH APPELLATE DISTRICT State of Ohio, :
Plaintiff-Appellee, :
No. 13AP-10 v. : (C.P.C. No. 11CR-07-3857) Isaac J. Castile, III, : (REGULAR CALENDAR)
Defendant-Appellant. :
D E C I S I O N
Rendered on May 6, 2014 Ron O’Brien , Prosecuting Attorney, and Michael P. Walton , for appellee.
Sam B. Weiner , for appellant.
APPEAL from the Franklin County Court of Common Pleas KLATT, J.
Defendant-appellant, Isaac J. Castile, III, appeals from a judgment of
conviction and sentence entered by the Franklin County Court of Common Pleas. For the following reasons, we reverse that judgment and remand the matter for resentencing. I. Factual and Procedural Background On July 21, 2011, a Franklin County Grand Jury indicted appellant with
three counts of securities fraud, in violation of R.C. 1707.44(G), three counts of false representations in the sale of securities, in violation of R.C. 1707.44(B)(4), three counts of the sale of unregistered securities, in violation of R.C. 1707.44(C)(1), and three counts of theft, in violation of R.C. 2913.02. The charges arose out of different transactions in which appellant accepted money from three Ohio citizens: John Prater, Jennette Stevens, *2 and Raymond Smith pursuant to offerings from the Metropolitan Enhancement Treasure- Backed Investements, Ltd. ("METBI"). Appellant was one of the managers of METBI. Appellant entered a not guilty plea to the charges and proceeded to a jury trial.
{¶ 3} At trial, Harvey McCleskey, Enforcement Attorney for the Ohio Division of Securities ("the division"), testified about his investigation of appellant. The division's investigation of appellant began in late 2006 or early 2007 after it received complaints from out-of-state investors. McCleskey learned of Prater, Stevens, and Smith during the investigation. Specifically, Stevens invested $6,000 with appellant in 2006 and received a 10 percent Convertible Subordinated Debenture from METBI, which is a security that entitled her to receive her principal plus interest at the end of the stated term. Prater initially invested $250,000 with appellant for a similar debenture in 2005 and rolled that investment over for another year in 2006. Smith invested $5,000 in another similar investment in 2008. A Private Placement Memorandum ("PPM") that went along with the
debentures contained details about the investment. The PPM provided that 100 percent of the proceeds available after expenses of the offering would be used to purchase treasury bills which would then be used to acquire bank guarantees. Those guarantees would be swapped in a repurchase agreement for fixed rate commercial notes. The PPM also warned investors that the securities were speculative and involved a high degree of risk. McCleskey obtained bank records from appellant and METBI and looked for purchases of treasury bills in accordance with the PPM. McCleskey could not find any evidence that appellant purchased treasury bills with money he received from Prater, Stevens, and Smith. Upon his review of the financial records, McCleskey concluded that appellant was collecting money from investors and using that money to pay off other investors as well as his own personal expenses in what McCleskey termed a Ponzi scheme. (Tr. 113-14.) Each of the three victims testified about making what they thought were investments with appellant. Although Stevens did receive a small portion of her investment back, neither Prater nor Smith received any of their investments back. The jury found appellant guilty of all counts except one of the theft counts. The trial court sentenced appellant accordingly.
II. The Appeal Appellant appeals and assigns the following errors:
[1.] When the trial court actively participates in plea negotiations before trial, the fair trial rights of the accused are violated, contra the Fourth, Fifth, Sixth, and Fourteenth Amendments to the Constitution and Article I, Section 10 of the Ohio Constitution.
[2.] (A) When the trial court responds to a jury question during deliberations, that emphasizes conviction, the accused is denied his fair trial and due process rights under the Sixth and Fourteenth Amendments to the Constitution.
(B) The trial court directed a verdict in favor of the prosecution when it gave an instruction in answering a jury question, contra the Fifth, Sixth, and Fourteenth Amendments to the Constitution.
[3.] (A) The trial court erred when it imposed consecutive sentences without making the required findings required by statute.
(B) The trial court erred when it failed to merge the two securities fraud counts that involved the same conduct and a single state of mind of the accused, contra the double jeopardy clause of the Fifth, and Fourteenth Amendments to the Constitution.
[4.] When the state, through the testimony of a primary witness, introduces prejudicial inadmissible evidence, said misconduct results in violation of the Fifth, Sixth, and Fourteenth Amendments to the Constitution of the accused.
[5.] When the record established judicial bias, from the pre- trial proceedings, during the course of the jury trial, and at the sentencing hearing, the result is a structural error contra the Fifth, Sixth, and Fourteenth Amendment rights of the accused. For analytical clarity, we address the assignments of error out of order.
III. Appellant's First and Fifth Assignments of Error–Judicial Conduct These assignments of error focus on the trial court's conduct in these proceedings. Specifically, appellant claims that the trial court violated his fair trial rights *4 by actively involving himself with the plea negotiations before trial and because of his "established judicial bias." We reject both claims.
A. Involvement in Plea Negotiations Appellant alleges that the trial court improperly participated in plea
negotiations before his trial. We disagree. Appellant supports his argument with extensive reliance on the Supreme
Court of Ohio's decision in
State v. Byrd
,
Although this court strongly discourages judge participation in plea negotiations, we do not hold that such participation per se renders a plea invalid under the Ohio and United States Constitutions. Such participation, however, due to the judge's position in the criminal justice system presents a great potential for coerced guilty pleas and can easily compromise the impartial position a trial judge should assume.
As a consequence we hold that a trial judge's participation in the plea bargaining process must be carefully scrutinized to determine if the judge's intervention affected the voluntariness of the defendant's guilty plea. Ordinarily, if the judge's active conduct could lead a defendant to believe he cannot get a fair trial because the judge thinks that a trial is a futile exercise or that the judge would be biased against him at trial, the plea should be held to be involuntary and void under the Fifth Amendment and Section 10, Article I of the Ohio Constitution.
Id. at 293-94. Byrd and its progeny address the potentially coercive effect of a trial court's
involvement in plea negotiations when determining the voluntariness of a guilty plea.
State v. Finroy
, 10th Dist. No. 09AP-795,
B. Judicial Bias
{¶ 13}
Appellant also argues that the trial court was biased. Under R.C.
2701.03(A), when a party believes that the trial judge is biased, the proper avenue for
redress is filing an affidavit of disqualification.
See
Ohio Constitution, Article IV, Section
5(C). " 'An affidavit of disqualification must be filed as soon as possible after the incident
giving rise to the claim of bias and prejudice occurred or affiant becomes aware of
circumstances that support disqualification. A party may be considered to have waived its
objection to the judge when the objection is not raised in a timely fashion and the facts
underlying the objection have been known to the party for some time.' "
State v. Were
,
{¶ 14} For all these reasons, we overrule appellant's first and fifth assignments of error.
IV. Appellant's Fourth Assignment of Error–Prosecutorial Misconduct Appellant argues that the state engaged in a pattern of calculated misconduct by soliciting the admission of inadmissible evidence throughout McCleskey's testimony. We disagree. The standard of review for prosecutorial misconduct is whether the
comments and questions by the prosecution were improper and, if so, whether they
prejudiced appellant's substantial rights.
State v. Treesh
,
victims of appellant's conduct. During the state's examination of McCleskey, the prosecutor asked him how appellant came to the attention of the division. McCleskey commented that the division had received complaints from out-of-state investors. (Tr. 43.) The trial court overruled appellant's objection but instructed the witness to "stay in *6 the generality of why we're here." (Tr. 43.) During cross-examination, appellant's trial counsel asked McCleskey if he started the investigation into appellant's conduct as the result of a complaint filed by Prater. McCleskey replied again that he began the investigation in 2007 as a result of complaints from out-of-state investors. (Tr. 119.) Trial counsel then noted that McCleskey did not refer his investigation to the prosecutor's office until 2011. On re-direct, the prosecution asked McCleskey to explain the delay that occurred between the beginning of the investigation in 2007 and the referral in 2011. McCleskey explained that part of the delay occurred because of the out-of-state complaints. (Tr. 172.) Appellant also argues that the prosecutor improperly elicited McCleskey's
testimony that appellant was arrested and briefly jailed during the investigation of this case as a result of appellant's failure to comply with a subpoena the division issued in 2007 and that appellant requested an attorney after the service of the subpoena. (Tr. 174- 75.) This testimony was elicited by the prosecutor to explain the four-year delay between the beginning of the investigation in 2007 and the referral in 2011. In essence, appellant is claiming that McCleskey's responses to the
prosecutor's questions were improper, not that the prosecutor's questions themselves
were improper. This is not grounds for prosecutorial misconduct. The prosecutor's
questions were not improper. The prosecutor simply asked McCleskey to explain why the
division investigated appellant and why there was a delay in the investigation–a delay that
appellant's own trial counsel brought to the jury's attention. The prosecutor did not seek
to elicit any details about the out-of-state complaints, the subpoena, or appellant's arrest.
Further, the trial court twice provided the jury with a limiting instruction
regarding McCleskey's testimony. The instruction regarding the out-of-state complaints
warned the jury to only consider them "as to why [McCleskey] did something. * * * They
are not before you as an issue. You're not getting any evidence on those, so the mere fact
that they have complainants in other states, you are not to take into consideration any
other factor other than, of course, why [McCleskey] did something." (Tr. 173.) Then, after
the testimony regarding appellant's arrest, the trial court instructed the jury "to disregard
testimony about the warrant and what happened in the civil proceeding. It has nothing to
do with the factual issues in this case. You are directed to disregard it. * * * [T]he fact that
*7
State Highway Patrol arrested him has nothing to do with this, had nothing to do with
your indictment and they are to disregard that fact." (Tr. 175-76.) Such a limiting
instruction reduces the risk of prejudice as the result of any alleged prosecutorial
misconduct.
See Columbus v. Aleshire
,
{¶ 21} Having found no prosecutorial misconduct, we overrule appellant's fourth assignment of error.
V. Appellant's Second Assignment of Error–The Trial Court's Answer to Jury Question Appellant argues in his second assignment of error that the trial court erred
in its response to a jury question. We disagree. Generally, a trial court enjoys discretion to determine how to respond to a
jury question.
State v. Carter
,
duty to disclose he was under investigation?" (Tr. 405.) The trial court provided the following answer to the question: "If you find that he knew he was under investigation at the time of the sale then you can consider: If it is a material factor in the investor determination to purchase, please see the definition of 'material.' See page 7 of the instruction." (Tr. 414.) Appellant objected to the response, arguing that the issue of this nondisclosure was not alleged in his indictment and was never "part of the case." (Tr. 413.)
{¶ 25} Appellant argues that the trial court's response "essentially instructed them that he was guilty" and "in essence directed a verdict in favor of the prosecution." (Appellant's brief, at 28, 30.) While the rationale for appellant's argument is not clear to this court, it appears that appellant claims the trial court's response instructed the jury that being under investigation was a material factor. We disagree.
{¶ 26}
We first reject appellant's claim that nondisclosures were never part of this
case. Appellant faced counts of securities fraud in violation of R.C. 1707.44(G). Fraud in
that context refers to both affirmative misrepresentations as well as nondisclosures where
there is a duty to disclose.
State v. Warner
,
VI. Appellant's Third Assignment of Error–Sentencing Issues
Appellant takes issue with two aspects of his sentencing. First, he argues
that the trial court failed to make the required findings in order to sentence him to
consecutive sentences pursuant to R.C. 2929.14(C)(4). Upon a review of the sentencing
hearing, we agree. Nevertheless, the state argues that the trial court did not need to make
those findings because appellant committed his offenses before the effective date of the
reenactment of that statute in 2011 and that a failure to make the findings is not plain
error. This court has previously rejected both of the state's arguments.
State v. Simms
,
10th Dist. No. 13AP-299,
convictions for securities fraud for purposes of sentencing. We disagree. At sentencing, appellant did not request the merger of these two offenses
and therefore has forfeited this argument on appeal absent plain error.
State v.
*9
McClurkin
, 10th Dist. No. 11AP-944,
(A) Where the same conduct by defendant can be construed to constitute two or more allied offenses of similar import, the indictment or information may contain counts for all such offenses, but the defendant may be convicted of only one.
(B) Where the defendant's conduct constitutes two or more offenses of dissimilar import, or where his conduct results in two or more offenses of the same or similar kind committed separately or with a separate animus as to each, the indictment or information may contain counts for all such offenses, and the defendant may be convicted of all of them. To determine whether offenses are allied and of similar import and
therefore subject to merger, "the question is whether it is possible to commit one offense
and commit the other with the same conduct, not whether it is possible to commit one
without committing the other. * * * If the offenses correspond to such a degree that the
conduct of the defendant constituting commission of one offense constitutes
commission of the other, then the offenses are of similar import."
State v. Johnson,
128
Ohio St.3d 153,
must determine whether the offenses were committed by the same conduct, i.e., 'a single
act, committed with a single state of mind.' "
Johnson
at ¶ 49, quoting
State v. Brown,
Prater's investment of $250,000 should have merged because the same $250,000
investment was the basis for each conviction. The state argues that the two convictions
were based on separate conduct and done with separate animus. We agree. Count one
alleges that the fraud took place on or about July 26, 2005, when Prater initially invested
the money with appellant. That investment matured on July 26, 2006. Count two alleges
that the fraud took place on or about July 26, 2006, when Prater rolled over his initial
investment for another year. The fraud appellant committed in these two counts, be it
either affirmative misrepresentations or nondisclosures, were separate and occurred on
different dates.
State v. Copeland
, 12th Dist. No. CA2003-12-320,
consecutive sentences under R.C. 2929.14(C)(4), we sustain that portion of appellant's third assignment of error. We overrule the remaining portions of the third assignment of error.
VII. Conclusion In conclusion, we sustain in part and overrule in part appellant's third assignment of error. We overrule appellant's remaining assignments of error. This case is reversed and remanded to the Franklin County Court of Common Pleas for resentencing.
Judgment reversed; case remanded for resentencing.
BROWN and CONNOR, JJ., concur.