Case Information
*1 Before W OOD Chief Judge , C UDAHY R OVNER , Cir cuit Judges .
W OOD Chief Judge
. More years ago, Supreme Court announced Maryland, (1963), prosecutors duty turn over upon request any favorable defense. One think now failures comply rule rare. But issues continue arise. Often, non disclosure comes price prosecutors, courts *2 find withheld would created a “reasonable probability a different result.” Kyles Whit ‐ ley (1995) (quotation omitted). We must leave for another day a closer examination incentive structure created by Brady ’s harmless error exception, cause case before us another which viola tions do drive result. The implicating Hec tor a vast mail fraud scheme overwhelming, are confident prosecution’s alleged vi olation (a failure disclose two possibly exculpatory emails until after trial) made difference. We therefore affirm district court’s denial motion for a new trial.
I son Hector Morales, Jr. (Junior) operated business they called Intelligent Payment Services (IPS). The thing intelligent about it, however, served Moraleses profitably vehicle for defrauding small
businesses. Sales agents trained would contact business owners offer collect bad checks from businesses’ customers exchange for small commission. agents would tell business owners they worked either “American Processing Services” “National Set tlements Corporation,” IPS. agents then ask business owners certain personal information request voided check, ostensibly so IPS later wire funds obtained through its collection efforts them. fact, IPS put information shadier use. Once possession critical data, IPS made unauthorized drawals businesses’ bank accounts through various financial intermediaries. IPS tell intermediaries withdrawals covered payments leases credit *3 ‐ card processing equipment. In reality, IPS neither collected bad checks nor leased credit card processing equipment. In all, IPS fraudulently withdrew about $645,000 from its cus tomers’ accounts.
On July a team led Secret Service Jason Kane executed a search warrant on IPS’s office in Liber tyville, Illinois. IPS’s office suite consisted a small recep tion area and two adjacent offices. Upon entering suite, office on left was Junior’s office, and office on right was Morales’s. When agents knocked on IPS’s front door, receptionist Carmen Donaire person in reception area, and door Morales’s office closed. Before agents entered, and daughter Paulina walked out office and moved reception area.
Agents found trove incriminating on premises. They recovered laptop from Morales’s office which credit card “lease collection” form open partially filled out. addition, they recovered from same office personal financial information from ten victims $8,000 cash. Elsewhere premises agents found documents in Morales’s handwriting describing check collec tions, commissions paid agents, an accounting IPS’s finances notations reflecting more $20,000 re versed transactions over nine day period. Forensic analysis laptop discovered office laptop dis covered Junior’s office revealed both machines were fraud.
Other documentary also connected scheme. Bank statements showed during preced ing months, deposited funds IPS totaling *4 ‐ ‐ $439,000 in his personal accounts and used an additional $55,000 in IPS funds for personal credit card bills and car payments. (Morales even deposited IPS funds after date of raid.) Telephone records showed numerous calls and faxes related scheme from Morales’s private residence and office. Finally, investigators obtained a document pur porting credit card lease contract between one Walter Corea and IPS that filled out entirely in Morales’s handwriting. At trial, Corea testified that he had never heard IPS, nor had agreed lease any credit card equipment. Corea had, however, spoken with someone claiming work “National Settlements Corporation”; that person con vinced him sign up bad check collection service never produced dollar recovered funds.
Morales indicted nine counts mail fraud vio lation U.S.C. § 1341. At trial, government presented dozens witnesses, including Corea and nine other victims, forensic analysts, Donaire, and Kane. Donaire testified Morales and Junior jointly operated IPS. She noted Junior their respective laptops and times directed her call businesses Texas California offer bad check collection services. She identi fied handwriting various documents. Finally, Donaire testified she received numerous angry calls from customers complaining IPS made unauthor ized withdrawals their businesses’ accounts. Donaire said seemed “kind surprise[d]” when told about calls presented bank statement faxed one customer. Soon after, Donaire testified, Junior heated conversation behind closed doors one offices, but Donaire hear they said. *5 ‐
Agent Kane’s testimony was primarily used lay foundation for introduction of documents other evi dence recovered during search. Kane explained where in facility various pieces of were found, so that government could then introduce seized an exhibit. Kane also testified about search did not find, namely, signs of legitimate business activity in check collecting or credit card equipment leasing. Morales’s cross examination Kane was fruitful. It consisted mostly of Kane’s admitting he personally identify Mo rales’s handwriting understand Spanish. defense, argued scheme was perpe
trated entirely by Junior had knowledge it. According Morales, Junior betrayed him by using business perpetrate fraud. Morales’s counsel argued hundreds thousands IPS funds deposited Mo rales’s account pay his bills was legitimate re muneration Morales’s work IPS. The government opened its closing arguments by saying been caught “red handed” laptop office, which all accounts was Morales’s computer, showed partially completed “lease collection” form presumably an instrument fraud. The government then rattled off litany other record connecting Mo rales crimes. jury convicted all counts, sentenced nine years prison.
Three weeks after trial, an assistant attorney sent lawyer two emails Kane previously disclosed. first email, sent April message counsel government. It read:
Just another nugget info. When entered do search warrant inside Hector Morales Seniors office lap top [ sic ] was on a small desk beside his. According Daughter [Paulina Morales], she was entering items computer. Here is a picture was computer time. A screenshot from laptop as it appeared when discov ered office was attached.
The second email, sent June also a message from Kane government counsel. That email responded note government counsel indicating grand jury subpoena Paulina available be picked up. June email said:
Matt, got message[.] I will pick it [the sub poena] up I will serve it arrest every body house you know some body going jail [ sic ] more ever somebody maybe pet will tazered!
Despite Kane’s bluster, did arrest Morales, Paulina, any other suspect. Nor did Kane or anyone else “tazer” any person, much less pets. Rather, agents simply served subpoena Paulina leaving with her father their home.
After receiving copies Kane’s emails, filed motion new trial, asserting government’s holding emails until trial over violated constitutional rights . district court denied motion sentenced months’ impris onment. This appeal followed. *7 7 1103
II
A Brady claim has three components: (1) the evidence at issue must be favorable to the accused, either because it is exculpatory or because is impeaching; (2) the evidence must suppressed by the government, (3) the evidence must be material, is, there must be “a reasona ‐ ble probability the suppressed evidence produced different verdict.” Strickler v. Greene , U.S. 263, 281–82 (1999); see Kyles , U.S. (citing United States v. Bagley , U.S. (1985)). The only issue appeal re ‐ lates to third these elements. parties assumed there is threshold ques
tion this case, which is whether evidence must be admis sible be considered material Brady . We conclude end answer does matter outcome here, because either way result is same. We discuss point, however, there is difference opinion among circuits. Supreme Court’s holding Brady itself does an
swer question; there Court said broadly “the suppression by prosecution favorable accused upon request violates due process where evi dence material either guilt or punishment.” , 87; see also Cone Bell U.S. n.15 (2009) (“Although Due Process Clause Fourteenth Amendment, interpreted mandates dis closure material evidence, obligation disclose evi dence favorable defense may arise more broadly un der prosecutor’s ethical statutory obligations.”). number decisions, understood Court be saying suppressed must more *8 8 12 3558 13 1103 guilt punishment—it must actually be admissible order trigger analysis. E.g. United States v. Dimas , 3 F.3d 1015, 1019 (7th Cir. 1993) (“[M]ost important, court must determine whether extent [withheld] evi dence … be admissible at trial.”); United States v. Silva , 71 F.3d 667, 670 (7th Cir. 1995) (“[E]vidence have been admissible at trial is immaterial it could affected trial’s outcome.”); United States v. Salem , 578 F.3d 682, 686 (7th Cir. 2009) (“Of course … only admissi ble evidence can be material, for admissible evidence could possibly lead different verdict.”); Jardine v. Dittman , 658 F.3d 772, 777 (7th Cir. 2011) (“Logically, inad missible evidence immaterial this rule.”). Fourth Circuit agrees this position. See Hoke v. Nether land , 92 F.3d 1350, 1356 n.3 (4th Cir. 1996). First, Second, Third, Sixth, Eleventh Circuits read so narrowly. See Johnson v. Folino , 705
F.3d 117, 130 (3d Cir. 2013) (“[I]nadmissible evidence may be if could led discovery admissible evidence.”); Ellsworth v. Warden , 333 F.3d 1, 5 (1st Cir. 2003) ( en banc ); United States v. Gil , F.3d 93, 104 (2d Cir. 2002); Bradley v. Nagle , F.3d 559, (11th Cir. 2000); United States v. Phillips , F.2d (6th Cir. 1991); see also United States v. Pflaumer , U.S. (1985) (remanding without opinion further consideration light Bagley where appeals court stated “[i]n order be material, suppressed must admissible trial”).
Courts both sides question look support Supreme Court’s opinion Wood Bartholomew (1995). Compare Ellsworth F.3d ( Wood “implicitly assumes” inadmissible “so promising *9 a lead to strong exculpatory evidence that there could be no justification for withholding it”), with Hoke F.3d at n.3 (citing Wood for the proposition that inadmissible evi dence is, “as matter of law, ‘immaterial’”). In Wood the Court considered case which the undisclosed evidence unquestionably “inadmissible state law, even impeachment purposes.” at 6. At outset, the Court acknowledged that evidence “could have had direct effect outcome of trial” it “not ‘evidence’ at all.” Id . (emphasis added). Nevertheless, Court did end its opinion with that observation, it would have done if inadmissibility were end mat ter.
Instead, Court proceeded analyze whether withheld information “might have led [defendant’s] counsel conduct additional discovery might have led some additional been utilized.” Id . It concluded answer question no. so do ing, noted court appeals failed specify might been found, if suppressed ma terials turned over. Id. record provided strong support finding immateriality: defendant’s counsel “acknowledge[d] disclosure affected scope cross examination” implicated witness. Id . at 7–8. Under those circumstances, Court concluded, “it [was] ‘reasonably likely’ disclosure … resulted different outcome trial.” Id. 8. We find Court’s methodology Wood more consistent with majority view courts appeals rule restricts formally admissible evidence. *10 1103 fact evidence that can be only for im ‐
peachment is subject to Brady rule also supports ma ‐ jority position. See Giglio United States , U.S. 154–55 (1972); Bagley , U.S. at 676. Although extrinsic evidence is not admissible prove specific instances witness’s con ‐ duct, see F ED . R. E VID . 608(b), withholding such evidence defendant still falls within ambit Brady if ‐ quiring about witness’s conduct during cross ‐ examination “may [have made] difference between con ‐ viction acquittal.” Bagley , U.S. at 676; see, e.g. , Salem , F.3d at (explaining witness’s alleged involve ‐ ment first degree murder may material im peachment evidence under Brady ). It is hard find princi pled basis for distinguishing inadmissible impeachment evi dence other inadmissible evidence that, if disclosed, would lead discovery evidence reasonably likely affect trial’s outcome.
If, despite all this, we were adhere our existing rule materiality inadmissible for pur poses, case would over. If we thought Mo rales might prevail majority rule, we would enter tain idea reconsidering our approach. As we now ex plain, however, we conclude would lose matter circuit in, so is occasion any such reconsideration.
As already noted, is purposes if there “reasonable probability” its disclosure defense changed result trial. Kyles 433–34 (quoting Bagley U.S. 682). defendant need prove disclosure more likely resulted acquittal, nor *11 evidence been insufficient convict if timely disclosure had made. Id. at 434–35. Rather, “favorable evidence is subject constitutionally mandated disclosure when it reasonably be taken put the whole case in such different light undermine confidence in the ver ‐ dict.” Cone at (quotation omitted). Because “the effect that particular piece of evidence likely outcome of trial must determined light of full context of weight and credibility of all evidence ac ‐ tually presented at trial,” we review district court’s deni al new trial motion based finding of lack of materi ality an abuse discretion. Silva F.3d 670.
Morales argues that Kane’s April email was because (a) email contradicted govern ment’s “trial theme” that Morales was caught “red handed,” (b) email was useful impeachment its “inconsisten[cy] Kane’s trial testimony [Paulina Morales] was within sight front entrance IPS” when agents arrived raid. We consider these points turn.
Although April email contains Paulina hearsay statement she, rather her father, was enter ing items computer, see likelihood her statement affected outcome trial. To begin with, exaggerates when says gov ernment’s “trial theme” it caught red handed. government’s position intimately involved fraud every step, ample back up. It showed trained recruited sales agents, falsified documents, kept books, collected profits fraud. That Mo *12 1103 rales may or may not been “caught red handed” dur ing the office raid was not crucial to the government’s case. Even if Morales did not enter information in his computer immediately before the agents’ arrival, that do almost nothing to advance his argument that he no involve ment in the fraud, given the wealth other evidence. Cf. Strickler , (rejecting claim where “there was considerable forensic other physical link ing petitioner to the crime”). using the expression “caught red handed” during
closing arguments, the government’s attorney was urging jury draw inference was caught in the act perpetuating fraud because computer he regularly was in office from which he emerged showed fraudulent lease form in progress. Even if Paulina Morales’s statement she was “entering items computer” when agents arrived revealed jury, government could just easily urged jury draw inference caught red handed his daughter midst helping him carry out fraudulent scheme. Whether, ex tent which, Paulina involved scheme does not mitigate own substantial role.
Moreover, Paulina’s hearsay statement April email contains information should al ready known. See United States v. Mahalick F.3d 478–79 (7th Cir. 2007) (“ requires disclosure exculpatory known government but defendant.”) (quoting United States Dawson F.3d (7th Cir. 2005)). contends known before disclosure April email *13 13 1103 his daughter was entering into his computer and that, had he known, he would have called her to testify. But is nonsense. Morales knew the moment the agents con ducted their raid Paulina was with him in his office; all he had to do was ask her what she was doing. By the time trial, knew exactly the agents found the laptop in office. Nothing in the contested emails would helped him decide whether call Paulina to stand. notion called Paulina witness if April email available impeach her, her testimony affected trial, is too speculative availing. See Wood (reject ing finding materiality where “judgment is based mere speculation”).
Nor April email im peach Kane’s testimony. See Salem F.3d (“[O]rdinarily, newly discovered impeachment will warrant new trial .”). Indeed, see noth ing in April email contradicts Kane’s testimony. Kane’s account Paulina Morales’s location was clear consistent email. Using blueprint offices, Kane pinpointed every person’s location. Donaire corrobo rated Kane’s account by testifying Paulina were office when agents arrived, but came out reception area by time they entered. At most, April email reveals slight discrepancy between these accounts Paulina’s. But discrepancy resolved reading word “entered” mean “arrived.” When agents “arrived” execute search warrant, Paulina was office. By time agents walked into premises, Paulina reception area. None matters, however. Whether Paulina reception area when *14 officers entered execute the search warrant has no bearing on Morales’s guilt or innocence. Because the April email does not undermine confidence the verdict, it imma ‐ terial purposes. argument about June email fares no bet
ter. He contends June email because it could have been impeach Kane’s testimony on grounds of bias. Once again, we conclude email could had no discernible effect trial.
This argument founders it hard see how June email demonstrates any bias. Kane’s little show of bravado an internal email colleague no real world consequence, as neither arrested nor tazed anyone (or anyone’s pet). Because impeachment value min imal best, has not shown disclosure of June email created reasonable probability different outcome. See United States Agurs 109–10 (1976) (“The mere possibility an item undis closed information might helped defense … does establish ‘materiality’ constitutional sense.”).
Finally, see cumulative effect belated dis closure two emails. government’s case did rest entirely, even principally, Kane’s testimony. government called different agent testify about office layout location items were seized Kane discredited. Indeed, did: sev eral witnesses, well as documentary forensic evi dence, corroborated Kane’s testimony. light strength against Morales, emails do undermine our confidence verdict.
Under any test might apply, conclude dis trict court did err when denied motion new trial.
A FFIRMED .