710 F.

2d 639

UNITED STATES of America, Plaintiff-Appellee,

v.
Steven S. GLICK, Defendant-Appellant.
No. 82-1375.

United States Court of Appeals,

Tenth Circuit.
June 10, 1983.
Rehearing Denied July 27, 1983.

Dennis A. Fischer of Fischer & Hill, Los Angeles, Cal. (Nancy Gaynor,
Fischer & Hill, Los Angeles, Cal., and Michael S. Axt, Denver, Colo.,
with him on the brief), for defendant-appellant.
Charles H. Torres, Asst. U.S. Atty., Denver, Colo. (Robert N. Miller, U.S.
Atty., Denver, Colo., with him on the brief), for plaintiff-appellee.
Before SETH, Chief Judge, and BREITENSTEIN and SEYMOUR,
Circuit Judges.
SEYMOUR, Circuit Judge.

Steven Glick was convicted after a jury trial of eight counts of mail fraud, 18
U.S.C. Sec. 1341 (1976),1 and two counts of travel in interstate commerce to
execute a scheme to defraud, 18 U.S.C. Sec. 2314 (1976).2 On appeal, Glick
argues that the court improperly instructed the jury on the issue of fraudulent
intent, and that he was denied effective assistance of counsel because his
attorney failed to conduct adequate pretrial investigation. We affirm.

I.
THE FACTS
2

Viewed in the light most favorable to the Government, see United States v.
Petersen, 611 F.2d 1313, 1317 (10th Cir.1979), cert. denied, 447 U.S. 905, 100
S.Ct. 2986, 64 L.Ed.2d 854 (1980), the facts are briefly as follows. Reginald

Chisholm, the mastermind of the fraudulent scheme, was described as a man of

great charm and personal magnetism. He held himself out during 1975 and
1976 as a very wealthy person who could package and obtain loans for people
seeking financing. He charged a nonrefundable front fee for this service.
Chisholm told his victims that as part of his service he would guarantee the
loans, and that his guarantee would carry weight with lending institutions
because of his wealth. To support these representations, Chisholm showed his
victims financial statements describing Chisholm's personal wealth and that of
three corporations he owned or controlled. These statements were prepared by
Glick, a certified public accountant, and included letters by Glick declaring that
the statements fairly presented the subject's financial position in conformity
with generally accepted auditing standards and accounting principles.
3

The principal asset of Chisholm and his corporations was his claim to mineral
rights in limestone formations in National Forest lands. These rights had been
transferred by Chisholm to one of his corporations, and then from corporation
to corporation, each transfer resulting in an increased valuation of the mining
claims.

Chisholm and Glick were indicted, and Chisholm pled guilty prior to trial.
Chisholm had previously been convicted in a federal criminal proceeding in
Portland, Oregon, on charges apparently arising from other acts involving the
same fraudulent plan.

The actual value of Chisholm's mineral rights, and the nature of his title to
them, were major issues at Glick's trial. The testimony of the Government's
expert, a geologist with the Department of Interior, indicated that the value of
the claims was far below that shown on the financial statements. He stated that
Chisholm faced insurmountable obstacles in any effort to mine the limestone or
to obtain the fee simple title necessary for a proposed real estate development.

Glick testified that before and during the time he had prepared the financial
statements, four appraisals had been made that substantially supported the
values contained in the statements. Glick was unable to remember the authors
or the details of the two earliest appraisals. The third report was prepared by a
real estate appraiser, Smith, who was not a geologist and had an interest in the
Chisholm business enterprises. Glick testified that he had not accepted the
Smith appraisal at face value because Smith was not independent. Glick stated
that Smith's results had been verified by another independent real estate
appraiser, Goldring, who had based his evaluation on facts and figures supplied
by Smith. Although the Smith report was admitted into evidence, Glick was
unable to produce the Goldring report.

Chisholm had obtained a fifth appraisal in 1978 in preparation for his Portland
trial. This preliminary evaluation, from a geologist named Stickel, stated that
one of the mineral claims contained sufficient limestone deposits to warrant
consideration of commercial mining. This appraisal was admitted into evidence
by stipulation of the parties, although Stickel himself did not testify.

The Government presented expert testimony that the financial statements

prepared by Glick contained blatant violations of basic accounting principles.
Glick himself had conceded that no lending institution would furnish a loan
based on the Chisholm financial statements. Glick testified that he knew
Chisholm was obtaining fees by presenting the financial statements to people,
claiming that the documents could be used to back up loan applications.
However, Glick testified that he believed the limestone deposits were of
considerable value to Chisholm, and that he thought Chisholm's loan packaging
business was bona fide when he prepared the financial statements.

II.
THE INTENT INSTRUCTIONS
9

"Mail fraud is a specific intent crime. The government is required to prove

beyond a reasonable doubt that the defendant intended to defraud." United
States v. Martin-Trigona, 684 F.2d 485, 492 (7th Cir.1982). The district court
gave the following instruction on deliberate ignorance as part of its charge on
the type of knowledge which satisfies the requisite fraudulent intent:

10

"However, the element of knowledge may be established by proof that a

defendant deliberately closed his eyes to what otherwise would have been
obvious to him. In other words, the requirement that the defendant has acted
knowingly does not mean that the defendant needed to have positive
knowledge. If the defendant failed to have positive knowledge only because he
conscientiously avoided acquiring it, the requirement of knowledge is
satisfied."

11

Rec., vol. VIII, at 673. On appeal, Glick contends that this instruction is an
erroneous formulation of the law because it permitted the jury to convict upon
proof of a lesser degree of knowledge than that required by the statute.

12

In recommending the use of a deliberate ignorance instruction, this court has

pointed out that "[w]hile negligence is not sufficient to charge a person with
knowledge, one may not wilfully and intentionally remain ignorant of a fact,
important and material to his conduct, and thereby escape punishment. The test

is whether there was a conscious purpose to avoid enlightenment." Griego v.

United States, 298 F.2d 845, 849 (10th Cir.1962) (footnotes omitted). Thus, the
type of instruction at issue here may be given when the evidence points to
deliberate ignorance and conscious avoidance of actual knowledge. See United
States v. Garzon, 688 F.2d 607, 609 (9th Cir.1982); United States v.
Ciampaglia, 628 F.2d 632, 642-43 (1st Cir.), cert. denied, 449 U.S. 956, 101
S.Ct. 365, 66 L.Ed.2d 221, 449 U.S. 1038, 101 S.Ct. 618, 66 L.Ed.2d 501
(1980); United States v. Brien, 617 F.2d 299, 312 (1st Cir.), cert. denied, 446
U.S. 919, 100 S.Ct. 1854, 64 L.Ed.2d 273 (1980); United States v. Batencort,
592 F.2d 916, 918 (5th Cir.1979).
13

Glick argues that giving a deliberate ignorance instruction was inappropriate in

light of the evidence presented at trial. This argument is apparently based on
Glick's assertion that the record does not contain sufficient evidence of his
willful ignorance in the face of facts known to him that would have made
obvious the existence of the fraudulent scheme.

14

In denying Glick's motion for directed verdict, the trial judge determined that
the instruction was proper because a reasonable juror could find that Glick had
intentionally remained ignorant despite his subjective awareness of facts plainly
indicating the fraudulent nature of Chisholm's business. The court specifically
noted evidence of Glick's numerous blatant violations of accounting principles
and auditing standards, his belief in 1975 that the mineral claim evaluations
were unrealistic, his acknowledgment that no one would give a loan on the
basis of the financial statements, his knowledge that fees were obtained for
packaging loans which would likely not go through, and his knowledge of the
nature of the corporate financial activities. This evidence is sufficient to enable
a jury to find beyond a reasonable doubt that Chisholm's loan packaging
business was a fraudulent scheme from its inception, and that Glick either knew
it or deliberately avoided acquiring positive knowledge. Accordingly, we
conclude that an instruction on deliberate avoidance was appropriate. See
Griego, 289 F.2d at 849.

15

Glick also argues that even if a deliberate ignorance instruction was warranted,
the form of the instruction given in this case was inadequate because it failed to
require the jury to find that "the defendant was subjectively aware of a high
probability of the existence of the fact whose knowledge is imputed, and that
knowledge of that fact may not be imputed if the defendant actually believed
that such fact did not exist." Brief of Appellant at 17. To insure that a defendant
is only convicted if his ignorance is willful, rather than negligent, the
preferable form of the instruction informs the jury, in addition to the charge
given in this case, "(1) that the required knowledge is established if the accused

is aware of a high probability of the existence of the fact in question, (2) unless
he actually believes it does not exist." United States v. Jewell, 532 F.2d 697,
704 n. 21 (9th Cir.) (en banc), cert. denied, 426 U.S. 951, 96 S.Ct. 3173, 49
L.Ed.2d 1188 (1976); see also United States v. Aulet, 618 F.2d 182, 190-91 (2d
Cir.1980). Glick urges that the court's failure to add this language to its charge
is grounds for reversal. We disagree.
16

In response to counsel's general objection to the instruction, the district court

repeatedly offered to modify the instruction if counsel wished to propose a
language change.3 Defense counsel responded that his objection was not to the
language of the instruction, but to the propriety of such an instruction in any
form. Because Glick failed to suggest to the trial court the language he now
claims was erroneously omitted, we may reverse only if the omission
constitutes plain error. Fed.R.Crim.P. 52(b).

17

The jury was instructed that Glick could not deliberately close his eyes to what
would otherwise be obvious to him, that he could not be convicted for an act
done because of mistake, accident, or innocent reason, and that he was innocent
even if he prepared fraudulent financial statements if he did not intentionally
and knowingly participate in the scheme or artifice to defraud.4 Although
inclusion of the omitted language would have been preferable, the omission in
this case did not constitute plain error. See United States v. Cincotta, 689 F.2d
238, 243-44 (1st Cir.), cert. denied, --- U.S. ----, 103 S.Ct. 347, 74 L.Ed.2d 387
(1982); United States v. Eaglin, 571 F.2d 1069, 1074-75 (9th Cir.1977), cert.
denied, 435 U.S. 906, 98 S.Ct. 1453, 55 L.Ed.2d 497 (1978); Jewell, 532 F.2d
at 704 n. 21.

III.
ADEQUACY OF COUNSEL
18

Glick claims he was denied effective assistance of counsel because his trial
attorney5 allegedly failed to conduct adequate pretrial preparation and was
therefore unable to present an effective defense at trial. Glick points
specifically to counsel's failure both to investigate the existence and nature of
the two earliest mineral appraisals and the Goldring appraisal, and to determine
the possibility of obtaining favorable independent expert testimony from Stickel
concerning the value of the limestone.

19

"The Sixth Amendment demands that defense counsel exercise the skill,
judgment and diligence of a reasonably competent defense attorney." Dyer v.
Crisp, 613 F.2d 275, 278 (10th Cir.) (en banc), cert. denied, 445 U.S. 945, 100

S.Ct. 1342, 63 L.Ed.2d 779 (1980). In considering an allegation of incompetent

counsel, the court must first determine whether the attorney's performance fell
below this standard. The court must then determine whether the inadequacy
"has had or threatens some adverse effect upon the effectiveness of counsel's
representation or has produced some other prejudice to the defense." United
States v. Morrison, 449 U.S. 361, 365, 101 S.Ct. 665, 668, 66 L.Ed.2d 564
(1981).6
20

The proper standards for evaluating a claim of ineffective assistance of counsel

based upon allegations of inadequate trial preparation were recently addressed
in Washington v. Strickland, 693 F.2d 1243 (5th Cir.1982) (en banc), petition
for cert. granted, --- U.S. ----, 103 S.Ct. 2451, 75 L.Ed.2d ----. Effective counsel
must "conduct a reasonable amount of pretrial investigation," id. at 1251, which
"will necessarily depend upon a variety of factors including the number of
issues in the case, the relative complexity of those issues, the strength of the
government's case, and the overall strategy of trial counsel." Id.

21

"[A]n attorney who makes a strategic choice to channel his investigation into
fewer than all plausible lines of defense is effective so long as the assumptions
upon which he bases his strategy are reasonable and his choices on the basis of
those assumptions are reasonable." Id. at 1256. "Courts presume, in accordance
with the general presumption of attorney competence, that counsel's actions are
strategic." Id. at 1257; see DuPree v. United States, 606 F.2d 829, 830 (8th
Cir.1979) (per curiam), cert. denied, 445 U.S. 919, 100 S.Ct. 1284, 63 L.Ed.2d
605 (1980). An attorney's decision not to interview witnesses and to rely on
other sources of information, if made in the exercise of professional judgment,
is not ineffective counsel. Plant v. Wyrick, 636 F.2d 188, 189-90 (8th
Cir.1980). "Whether to call a particular witness is a tactical decision and, thus,
a 'matter of discretion' for trial counsel." United States v. Miller, 643 F.2d 713,
714 (10th Cir.1981). Counsel is not inadequate in failing to call a witness
whose testimony would only have been cumulative in nature. Id.

22

In applying the above standards to the allegations before us, we note the lack of
any objective showing that the missing appraisals were available, credible, or
favorable to Glick. We have only Glick's self-serving statements as to the
existence and contents of the two early appraisals and the Goldring report.
Moreover, we will presume in the absence of any evidence to the contrary that
counsel's decision not to produce the documents, even if they were available,
was a matter of trial strategy.

23

We also conclude that defense counsel's decision not to call Stickel as a witness
was a question of trial tactics. The Stickel report, which tended to support

Glick's assertion that the limestone was valuable, was admitted into evidence.
Counsel stated to the court that he was unsure of Stickel's value as a witness for
Glick because Chisholm still owed Stickel about $40,000. Counsel had read the
transcript of Stickel's testimony on behalf of Chisholm in the Portland trial, and
was thus in a position to evaluate the benefits and drawbacks of calling Stickel
to testify for Glick. Under these circumstances, the determination not to call
Stickel for the defense was a reasonable tactical decision. See Washington v.
Strickland, 693 F.2d at 1255. We have considered Glick's other allegations of
inadequacy and find them unpersuasive.
24

Finally, we note that Glick's trial counsel is a criminal law specialist, a former
prosecutor, and a member of the California Council of Criminal Justice. He had
been hired by the Justice Department to represent United States Attorneys
charged with perjury.

25

After reviewing the record, we agree with the Government that counsel's trial
strategy was apparently to convince the jury that the Government had hidden
witnesses and documents helpful to the defense. Moreover, the absence of the
documents and testimony made it possible for counsel to imply to the jury that
the evidence would have been favorable to Glick. We conclude on this record
that Glick received effective assistance of counsel.

26

AFFIRMED.

18 U.S.C. Sec. 1341 (1976) provides:

"Whoever, having devised or intending to devise any scheme or artifice to
defraud, or for obtaining money or property by means of false or fraudulent
pretenses, representations, or promises, or to sell, dispose of, loan, exchange,
alter, give away, distribute, supply, or furnish or procure for unlawful use any
counterfeit or spurious coin, obligation, security, or other article, or anything
represented to be or intimated or held out to be such counterfeit or spurious
article, for the purpose of executing such scheme or artifice or attempting so to
do, places in any post office or authorized depository for mail matter, any
matter or thing whatever to be sent or delivered by the Postal Service, or takes
or receives therefrom, any such matter or thing, or knowingly causes to be
delivered by mail according to the direction thereon, or at the place at which it
is directed to be delivered by the person to whom it is addressed, any such
matter or thing, shall be fined not more than $1,000 or imprisoned not more
than five years, or both."

18 U.S.C. Sec. 2314 (1976) provides in pertinent part:

"Whoever, having devised or intending to devise any scheme or artifice to
defraud, or for obtaining money or property by means of false or fraudulent
pretenses, representations, or promises, transports or causes to be transported,
or induces any person to travel in, or to be transported in interstate commerce in
the execution or concealment of a scheme or artifice to defraud that person of
money or property having a value of $5,000 or more; ...
"...
"Shall be fined not more than $10,000 or imprisoned not more than ten years,
or both."
Glick was also charged under 18 U.S.C. Sec. 2(a) (1976) with aiding and
abetting the above crimes.

Specifically, the court said:

"THE COURT: I am happy to change the language. I think the plaintiff is
entitled to this theory. If you want to switch it around a little better, take some
other language from one of these cases, I am happy to do it.
"MR. BRAUN: I don't think they are entitled. I think I will go further than that.
I don't think they are entitled to that theory. I don't think the Jewell case is good
authority for that. I think the case is--you know--maybe we should say the
fundamental problem with citing cases for jury instructions is that a court
writes a decision with one purpose in mind and one state of the law and we
prepare a jury instruction for the purpose of instructing laymen as to what their
duties as jurors are.
"THE COURT: I have no problem in modifying it, if you will give me the
suggested language. I think the theory is proper for this case; but I am happy to
change the language."
Rec., vol. VIII, at 559-60.
"THE COURT: I would be happy to take the quote right out of [Jewell ], if you
would like to take the quote out of that case."
Id. at 582.

The court instructed as follows on the definition of "knowingly":

"An act is done knowingly if done voluntarily and intentionally and not because

of mistake or accident or other innocent reason.

"The purpose of adding the word 'knowingly' is to ensure that no one would be
convicted for an act done because of mistake or accident or innocent reason."
Rec., vol. VIII, at 670. It then instructed on fraudulent intent and deliberate
ignorance:
".... In order to convict the defendant in this case, you must find that he acted
knowingly.
"It is not necessary, however, for the Government to prove that the defendant
was aware of every detail of the alleged scheme to defraud, so long as you find
beyond a reasonable doubt that he was a knowing participant in the scheme.
"It is not sufficient for you to find beyond a reasonable doubt that Mr. Glick
knew the financial statements were used to guarantee loans, since such
transactions are legal. For you to convict Mr. Glick, you must find beyond a
reasonable doubt that he was aware of the fraudulent aspects of the transactions.
"However, the element of knowledge may be established by proof that a
defendant deliberately closed his eyes to what otherwise would have been
obvious to him. In other words, the requirement that the defendant has acted
knowingly does not mean that the defendant needed to have positive
knowledge. If the defendant failed to have positive knowledge only because he
conscientiously avoided acquiring it, the requirement of knowledge is satisfied.
"....
"THE COURT: It is not sufficient to merely prove that Steven Glick prepared
fraudulent financial statements. The prosecution must also prove beyond a
reasonable doubt that Mr. Glick knowingly participated in the scheme or
artifice involved in this case. Thus, if you find that Mr. Glick prepared
fraudulent financial statements but did not intentionally and knowingly
participate in the scheme or artifice involved in this case, you must find him not
guilty."
Id. at 672-73.
5

Glick is represented by different counsel on appeal

Because of our conclusion that Glick has failed to establish trial counsel
ineffectiveness, we need not decide what degree of prejudice must be shown.
See generally, e.g., Washington v. Strickland, 693 F.2d 1243, 1258-63 (opinion

of the court), 1270-74 (Tjoflat, J., concurring), 1287-88 (Roney, J., dissenting)
(5th Cir.1982) (en banc)