Justia U.S. 7th Circuit Court of Appeals Opinion Summaries

Romasanta worked in Chicago as an expediter, helping developers obtain construction permits. In testifying against Curescu, a developer, she admitted bribing 25 to 30 city employees between 2004 and 2007. She paid an $8,000 bribe to a zoning inspector on behalf of Curescu. Convicted of bribery of an agency that receives federal assistance, 18 U.S.C. 666 and conspiracy, 18 U.S.C. 371, Curescu was sentenced to six months and the zoning inspector to 41 months in prison. The Seventh Circuit affirmed, rejecting various challenges to testimony and to the court's refusal to severe the cases.

Sanchez rose through the ranks of Chicago politics and became Commissioner of Streets and Sanitation. He was a leader of the Hispanic Democratic Organization, and, acting as a city official and a political operative, participated in a scheme to award city jobs to campaign workers in violation of orders and consent decrees, known as the Shakman decrees, enjoining the city from patronage hiring for most positions. Del Valle managed campaigns staffed by Sanchez's branch of the HDO and had significant influence in choosing individuals for positions. On retrial, Sanchez was convicted of mail fraud, 18 U.S.C. 1341 and Del Valle of perjury, 18 U.S.C. 1623. The Seventh Circuit affirmed, rejecting arguments concerning the court's handling of testimony about driving while intoxicated and arguing with a police officer; denial of severance; and the government's failure to prove economic loss. City jobs are money or property for purposes of mail fraud and the indictment sufficiently alleged deprivation of money or property.

In 2009, fire severely damaged the insureds' home. They submitted a claim to under their homeowners’ policy the next day. The insurer began requesting documents, authorizations, and interviews and learned that the insureds had at least two businesses, held numerous personal and business accounts, and were involved in several lawsuits. A fire investigator concluded that the fire was intentionally set. The insurer requested additional documents: detailed phone records, bank histories, tax returns, and mortgage information and reminded the insureds that proof of loss was due by May 2. The insurer granted extensions; on the day of the final deadline the insureds delivered almost 1,000 pages of documents. Several months later, the insurer had not received most of the requested documents or an explanation why they could not be produced. After initially acknowledging their failure to produce the documents, the insureds attempted to impose a deadline for settlement of the $2.6 million claim. The district court entered summary judgment for the insurer in the insureds' breach of contract suit. The Seventh Circuit affirmed. The insureds failed to perform the specific "duties after loss" listed in the policy.

Following published stories about an investigation of their business practices, principals of a waste-management company improved their chances of winning a bid for a contract to refurbish garbage carts for the City of Chicago by slashing their bid. They encouraged other companies to bid in hopes of being hired as a subcontractor if another company won the bid. Each bidder had to certify that it had not entered into any agreement with any other bidder or prospective bidder relating to the price, nor any agreement restraining free competition among bidders. The company won the bid, and after a Justice Department investigation for antitrust violations, the principals were convicted of mail and wire fraud. The Seventh Circuit reversed, reasoning that the purpose of "colluding" with other potential bidders had not been to prevent them from underbidding but to provide insurance against the bid being rejected based on the earlier investigation. There was no harm as a result of the company encouraging additional bidders.

While working as office manager and executive assistant for three successive businesses, defendant embezzled more than $240,000 by making personal purchases on company credit cards, falsifying expense reimbursement claims, and depositing corporate checks in her personal account. She pleaded guilty to one count of wire fraud, 18 U.S.C. 1343, reserving the right to challenge a recommendation of a two-level sentencing increase for abuse of a position of trust, U.S.S.G. 3B1.3. The district court accepted the recommendation, which resulted in a guidelines range of 27 to 33 months, and imposed a sentence of 27 months. The Seventh Circuit affirmed, acknowledging that it was a "borderline" case for abuse-of-trust enhancement, and deferring to the trial court findings.

Defendant, a medical doctor, was convicted of distributing fentanyl, a Schedule II narcotic controlled substance, 21 U.S.C. 841(a)(1) and obtaining morphine by misrepresentation, fraud, and deception, 21 U.S.C. 843(a)(3) and was sentenced to 48 months. The Seventh Circuit affirmed.The government was not required to present expert testimony, in light of overwhelming evidence of defendant's unprecedented and undocumented prescriptions of profoundly addicting and potent painkillers, which he personally administered in multiple, private houses and hotel rooms The district court properly enhanced his sentence for obstruction of justice because defendant lied to the U.S. Drug Enforcement Administration agents.

Defendant was convicted of 14 counts of willfully assisting in preparation of tax returns containing materially false and fraudulent claims, including phony medical and business expenses and charitable donations. The evidence at trial proved tax loss of $31,849. At sentencing, the government proposed a tax loss figure of $1.6 million by identifying 662 returns that contained materially false claims similar to those proven at trial and eliminating contested returns. The district court discounted the loss to $400,000- to $1-million to compensate for possible selection bias in a sample of 100 returns and imposed a sentence of 42 months. The Seventh Circuit affirmed. The tax loss figure was not outside the realm of permissible computations. The district court considered defendant's family circumstances as well as substantial aggravating circumstances, including her education, financial and intellectual abilities, knowledge of the tax code and duty to provide truthful information, and that her actions caused the IRS to audit her clients. Defendant also failed to appear for a sentencing hearing, was dishonest to the court, frivolously denied the court had jurisdiction over her, and similarly asserted she was an independent sovereign protected by the Eleventh Amendment.

A jury convicted the defendant of defrauding a large bank. The district judge sentenced him to 96 months in prison and ordered him to forfeit the money that he had obtained from the fraud, which the judge determined to be $16,241,202, plus property that he had bought with proceeds of the fraud, and to pay restitution to the bank also in the amount of $16,241,202. Defendant challenged the order of restitution. The Seventh Circuit reversed in part. Restitution, unlike forfeiture, is limited to the victim's loss, 18 U.S.C. 3664(f)(1)(A); the court remanded for determination of that loss. The court noted that loss has been limited by the government's decision to convey forfeited assets to the victim up to the limit of the loss.

A supervising building inspector was convicted of conspiracy to commit bribery, 18 U.S.C. 371, and two counts of making false statements to federal agents, 18 U.S.C. 1001(a)(2) and was sentenced to a total of 60 months' imprisonment. The Seventh Circuit affirmed. The district court properly allowed testimony about the 2005 gift list of a city businessman; the testimony was probative of intent and not so prejudicial as to cause the jury to decide the case on an improper basis. Although the court erred by admitting the list itself as a business record, the error was harmless. The court properly barred recordings between defendant and one of the witnesses who testified against him, which contained self-exculpatory statements. The court properly held defendant accountable for more than $112,500 in bribes, which resulted in an eight-level increase to the USSG offense level.

The title company provided real estate closing services. From 1984 through 1995, it served as exclusive agent for defendant and managed an escrow account that defendant contractually agreed to insure. The title company was not profitable and its managers used escrow funds in a "Ponzi" scheme. In 1989, there was a $26 million shortfall. To fill the hole, the managers began looting another business, Intrust, to pay defendant's policyholders ($40.9 million) and to pay defendant directly ($27 million), so that defendant was a direct and indirect beneficiary of the title company's arrangement with Intrust. In 2000 the state agency learned that the funds were missing, took control of Intrust and placed it in receivership. In July 2010, the Receiver filed suit for money had and received, unjust enrichment, vicarious liability), aiding and abetting breach of fiduciary duty, and conspiracy. The district court dismissed based on the statute of limitations. The Seventh Circuit affirmed. The Illinois doctrine of adverse domination does not apply. That doctrine tolls the statute of limitations for a claim by a corporation against a nonboard-member co-conspirator of the wrongdoing board members.