An Email State of Mind: Confessions of an Online Fraudaholic

A Criminal Defendant maintained an online business that was a shame: Orders were made and money paid, but the items ordered were either not sent or non-conforming goods instead.  This is all fun and games for the Defendant until an undercover FBI agent placed orders in a sting operation. 

The Defendant challenged the admission of customer email messages from the trial as they “were hearsay and that their admission was highly prejudicial and violated the spirit of the Confrontation Clause of the Sixth Amendment.”  United States v. Levy, 2009 U.S. App. LEXIS 14163, 8-9 (4th Cir. Va. June 30, 2009).   The Court did not agree.

Background Facts: Online Business Fraud

An online business owner ran two companies selling women’s fashions.  The Defendant served as the victim’s supplier.  Levy, 1-2. Both online businesses failed because of customer’s complaining they did not receive the ordered merchandise and demanded refunds.  Levy, 2-3.

The Defendant set up her own online business, with a laundry list of people not getting what they ordered for several years.  

One person made several attempts to get her merchandise through the Defendant’s website, which cost the Defendant a transaction fee with each attempt.  The Defendant sent the customer fraudulent documents from a make believe law firm that included a falsified complaint, apparently to scare the victim off.  Levy, 3-4.  

An undercover FBI agent placed an order through the Defendant’s website and true to form, did not get what she ordered.  The FBI eventually searched the Defendant’s house after the FBI orders were never shipped. Levy, 4.

The Government introduced into evidence at trial emails collected from the Defendant’s computer.  The emails were exchanges with angry customers and the Defendant’s replies.  Levy, 5.

The Defendant was convicted of three counts of mail fraud and four counts of wire fraud.  Levy, 5-6.  The Court estimated at least eighty-two victims who suffered $ 168,300.77 in damages.  Id. The Defendant was sentenced to 46 months’ imprisonment and pay $ 168,300.77 in restitution. Levy, 1.

The Defendant’s appealed followed.

Email & Hearsay: The Truth of the Matter Asserted

The Defendant challenged the customer email evidence on appeal as 1) hearsay and 2) the evidence was highly prejudicial and violated the 6^th Amendment Confrontation Clause.  Levy, 8-9.

The Court did not agree.  The Court held the email messages were not hearsay, because they were not offered for the truth of the matter asserted.  Levy, 9.

The customer email messages were offered so the Defendant’s party admissions in her email would show the context of the Defendant’s “intent, lack of mistake, and notice.” Levy, 9.

As such, the customer email messages were not hearsay and thusly did not violate the Confrontation Clause.  Levy, 9.

The Defendant’s conviction was upheld, but her sentence was vacated on sentencing grounds and remanded. Levy, 13.

Bow Tie Thoughts

Many of the e-Discovery admissibility examples are coming from criminal cases, since they go to trial more.  As more civil cases go to trial, Courts will likely look to the “e-admissibility” cases from criminal convictions for guidance in authenticating ESI, addressing hearsay and other evidentiary issues.

Admissibility of Text Messages: Challenging Authenticity

A criminal defendant appealing his conviction on ineffective counsel and insufficient evidence to support his convictions challenged text message evidence.  State v. Loye, 2009 Minn. App. Unpub. LEXIS 660, 1 (Minn. Ct. App. 2009).

The Defendant’s key argument at trial was challenging his victim’s credibility as the only witness to his attack upon her.  Loye, 2. Judging by his conviction, this obviously did not work out well for him. 

The Defendant argued the court erred in excluding text messages the victim sent after the assault.  The Defendant claimed these messages were relevant and were not barred as hearsay.  Loye, 3.    

The Court found no error.  Loye, 3.

Trial Procedure & Rules of Evidence

The trial court did allow some text message evidence that the victim “loved” the Defendant.  Loye, 3. 

Instead of offering text messages acquired from a cell phone with a tool such as Paraben, a collection expert who could explain collection methodology or a subpoena to a cell phone service provider to produce text messages, the Defense counsel offered a handwritten transcript of the text messages.  Loye, 4.

There was no one offered to authenticate this handwritten text message transcript.  The Prosecution objected to introducing the trial exhibit.  Loye, 3. 

The Defense successfully used the handwritten transcript to refresh the victim’s recollection and read into the record.  Loye, 4.  The handwritten notes were only admitted as a court exhibit and never went to the jury.

Flashbacks to Trial Advocacy 

Trial Advocacy and Evidence professors teach law students that “authenticity is a precondition to the admissibility of evidence.” Loye, 4.  

The Court found that the Defendants failed to lay any foundation with the handwritten text message transcript, thus the trial court properly excluded the evidence.  Loye, 4.  This might have been different if the Defendant had offered either the cell phone or a transcript from the cell phone service provider.

 

“If I Can’t Have It, No One Can”

The Defense tried arguing in the alternative that no text message evidence should have been admitted.  Loye, 4-5.  The Defense claimed that since the handwritten transcript was read to the jury to refresh the victim’s recollection, “The court erred by letting defense counsel cross-examine the alleged victim with the evidence without an accurate record that could be entered into evidence.”  Loye, 5.

Claiming prejudice because a jury has to rely on their own memories instead of text messages did not fly with the Court.  The Court noted jurors often rely on testimony and there was no explaination how this was prejudicial.  Loye, 5.

Admissibility Battles Can Be Avoided

Defense counsel could have avoided their inability to authenticate text messages with better case planning.  A subpoena could have been sent to the cell phone service provider on the victim’s text messages over the relevant time period.  A collection examiner could have defensibly imaged the victim’s (or the Defendant’s) text messages.  Photos could have been taken of the phone itself with the text messages.  However, none of those things happened.

A Note on Judicial Notice of Blogs and Admissibility of Electronically Stored Information

In a trade secret case, the Defendants attempted to strike the Plaintiffs’ complaint pursuant to the California Anti-SLAPP statute.  The Defendants failed to make a prima facie showing that the complaint arose from protected activity.  World Fin. Group v. Hbw Ins. & Fin. Servs., 2009 Cal. App. LEXIS 553 (Cal. App. 2d Dist. Apr. 16, 2009).

The Defendants on appeal requested judicial notice of blogs, online articles and websites.  This argument and request was made for the first time on appeal.  The Defendants claimed the online material showed the content of the communications at issue here involve a matter of public interest.  Defendants claimed the Court needed to take judicial notice of the evidence pursuant to California Evidence Code section 459(a)(2).  World Fin. Group, fn 7, 13-14.

California Evidence Code 459(a)(2) states, in relevant part:

The reviewing court shall take judicial notice of :…(2) each matter that the trial court was required to notice under Section 451 or 453. The reviewing court may take judicial notice of any matter specified in Section 452. The reviewing court may take judicial notice of a matter in a tenor different from that noticed by the trial court.

The Court pointed out one an error in Defendants’ use of California Evidence Code 459(a)(2): The statute does not compel judicial notice of documents that were NOT offered in the trial court.  World Fin. Group, fn 7, 14.  The argument that Defendants’ speech involved a matter of public interest (as evidenced by the online material) was being advanced for the first time on appeal and had not been presented to the trial court.  Id. This ran counter to the judicial notice statute and was denied for additional reasons. 

Judicial Notice was designed so a party does not have to formally present evidence to prove a fact that is “outside the area of reasonable controversy.”  Michael R. Arkfeld, Arkfeld on Electronic Discovery and Evidence, §8.6(B), citing FED. R. EVID. 201, Advisory Committee Note. 

Examples of judicial notice for electronically stored information include:

Online videos of “The Guy from Boston” from a local news channel, other websites and a blog.  Ligotti v. Garofalo, 2008 DNH 123, fn 15, 21-22 (D.N.H. 2008).

Website information from Amazon.com and American Academy of Allergy Asthma & Immunology in ERISA action.  Arkfeld, §8.6(C), citing Wible v. Aetna Life Ins. Co., 375 F. Supp. 2d 956 (C.D.Cal.Jun.20, 2005).

Online meeting minutes from the City’s Board of Mayor and Aldermen attached to an attorney’s affidavit as a public record.  Williams v. City of Franklin, 586 F. Supp. 2d 890, 894 (M.D. Tenn. 2008).

The admissibility of electronically stored information can take many paths in court, from party admissions on blogs, present sense impressions on Twitter or layered hearsay on cell phone video sent with an accompanying text message.  However, these issues almost always have to be raised at the trial court and not for the first time on appeal.