U.S. v. Petlechkov

922 F.3d 762 (2019) United States Court of Appeals for the Sixth Circuit 2019-05-01

criminal appeal from jury convictions on 20 counts of mail fraud; sufficiency challenge limited to materiality rejected for all counts; Counts 6, 13 and 19 affirmed, the other 17 counts dismissed without prejudice for unproved venue; remanded for resentencing (result: mixed)

Facts

  1. 1 Scheme or artifice to defraud satisfied conceded
    In order to obtain such a discount, Dimitar Petlechkov lied to FedEx and claimed he was a vendor for a high-volume shipper.
  2. 1 Scheme or artifice to defraud satisfied conceded
    Petlechkov concedes that he made a misrepresentation but contends that it was not material.
  3. 3 Material deception satisfied proved
    A fraudulent scheme must include a material misrepresentation, which is a misrepresentation that could influence the decision of a "person[ ] of ordinary prudence and comprehension."
  4. 3 Material deception satisfied proved
    His misrepresentation was simple: he called FedEx's account manager for General Dynamics-one of FedEx's larger clients-and claimed he was a General Dynamics vendor entitled to its discounted shipping rate.
  5. 3 Material deception satisfied proved
    And indeed, FedEx's standard "operating procedure" was to extend a customer's discounts to its vendors.
  6. 3 Material deception satisfied proved
    Thus, Petlechkov's false statement was capable of influencing FedEx's decision.
  7. 3 Material deception satisfied proved
    And indeed, it actually influenced FedEx's decision-FedEx gave him a discount that lasted for several years.
  8. 3 Material deception satisfied proved
    Newborn did testify that in some circumstances unwritten discounts violate Sarbanes-Oxley.
  9. 3 Material deception satisfied proved
    Despite Petlechkov's arguments to the contrary, a rational juror could have found his misrepresentation material.