McKINSTER, J. —
Defendants and appellants James William Riley and Ryan Jay Robinson appeal their convictions on three counts each of commercial bribery, in violation of Penal Code section 641.3, subdivision (a).
On appeal, defendants assert that there is insufficient evidence that they acted "corruptly," i.e., with the specific intent to injure or defraud Robinson's employer, as required by the statute. (§ 641.3, subds. (a), (d)(3).) They also assert, in response to our request for supplemental briefing, that there is insufficient evidence to support their convictions on two of the counts against each of them because the evidence showed that as of the date of those charged offenses, Robinson was no longer employed by Pechanga Resort and Casino.
The grand jury indicted Riley and Robinson on three counts of grand theft (§ 487, subd. (a), counts 1-3) from Pechanga Resort and Casino, and indicted each of them on three counts of commercial bribery (§ 641.3, subd. (a), counts 4, 6, 8 (Riley) and 5, 7, 9 (Robinson)). As to each count of commercial bribery, the indictment alleged that the bribe paid or accepted was in excess of $1,000. The grand jury also indicted Riley on three counts of money laundering. (§ 186.10, subd. (a), counts 10-12.) The indictment alleged that in count 12, the transaction exceeded $50,000, within the meaning of section 186.10, subdivision (c)(1)(A), and alleged that both defendants committed two or more related felonies involving embezzlement as a material element and that the pattern of felonies involved the taking of more than $500,000, within the meaning of section 186.11, subdivision (a)(2).
At defendants' first trial, counts 2 and 3 were submitted to the jury only as to Riley. The jury was unable to return a verdict as to any count of the indictment. Upon motion by defendants, the trial court dismissed counts 1 through 3 and 10 through 12, as well as the special allegations related to those counts, in the interest of justice. The court cited insufficient evidence to support a finding of guilt beyond a reasonable doubt. The court set the remaining counts for retrial.
Following a second trial, Riley was found guilty on counts 4, 6 and 8, and Robinson was found guilty on counts 5, 7 and 9. The jury found true the allegations that each count involved a bribe in excess of $1,000. As to Riley, the court imposed the lower term of one year four months on count 4 with consecutive terms of eight months on counts 6 and 8, and imposed associated fines and fees. As to Robinson, the court imposed the lower term of one year four months on count 5 with consecutive terms of eight months on counts 7 and 9, and imposed associated fines and fees. Each defendant filed a timely notice of appeal.
STATEMENT OF FACTS
Defendant James Riley had been a licensed commercial insurance broker since 1989. In 1996, while working for a firm called Austin Cooper and Price,
Approximately four years after Riley obtained the account, Robinson became the chief financial officer (CFO) for Pechanga Resort and Casino. (Hereafter sometimes referred to as the casino.) As CFO, Robinson was responsible for insurance for the casino. Robinson had worked for the casino for several years before he became CFO and, during that time, he and Riley had become friends.
On a number of occasions, beginning in April 2005, Riley gave Robinson large sums of money in the form of cashier's checks. Riley transferred the money from RGA's operating account into his personal savings account and then obtained the cashier's checks. Riley testified that the payments were personal loans or gifts motivated solely by friendship and, in one instance, an investment in a business Robinson was involved with, unrelated to Pechanga. He denied that the payments were related to or intended to influence Robinson with respect to Pechanga's insurance.
The first such payment took place in April 2005. This incident was not one of the charged offenses, but was offered to show the beginning of the pattern of activity. On April 28, 2005, $55,000 was deposited into Riley's personal savings account. On that same date, $55,000 was withdrawn from the account and a cashier's check in the amount of $40,000 was issued to Robinson, who
On March 30, 2006, RGA invoiced Pechanga for a deposit on the April 1 renewal of a policy issued by Hudson Insurance Company. The invoice was for $1,682,148.45. The financing agreement dated March 31, 2006, showed that the down payment was to be $1,091,606.45. The total premium on the policy was $8.2 million. On a revised financing agreement for the same policy, dated April 6, 2006, the policy premium was shown as $7.38 million, a difference of $820,000. On the April 6 financing agreement, the fee charged by RGA was increased by that amount over the March 31 financing agreement.
On June 8, 2006, a financing agreement from FIFC required a renewal down payment in the amount of $167,926.20. The balance of the premium was $1,511,335.80. RGA invoiced Pechanga for $367,926.20 for the renewal down payment. On July 11, 2006, $50,000 was transferred from RGA's general account into Riley's savings account. On that same date, Riley withdrew $20,000 from his savings account and obtained a cashier's check in that amount, payable to Robinson. Robinson deposited the check into his bank account.
On July 28, 2006, FIFC issued a financing agreement for premiums totaling $11.6 million. The agreement required a cash down payment in the amount of $1.16 million. Pechanga paid RGA's invoice for $1.16 million for the down payment on August 22, 2006.
On August 16, 2006, $100,000 was deposited to Riley's savings account. On that same date, $80,000 was withdrawn from the account, and four cashier's checks, each in the amount of $20,000, were made payable to Robinson. All were deposited into Robinson's bank account.
The $11.6 million transaction in July and August 2006 ultimately led to the discovery of the outside financial dealings between Riley and Robinson. That transaction was for obtaining additional "difference in conditions" (DIC) insurance, which covered property losses from earthquake and flood. Pechanga's DIC policy ran from April to April. In insurance years 2005 through 2006, Pechanga carried approximately $1.2 billion dollars in DIC insurance. In 2006, the availability of such insurance became severely limited as a result of Hurricane Katrina,
Robinson approved the purchase of the additional DIC coverage and signed the financing agreement for $11.6 million for the package of coverage, which would bring the total DIC coverage up to $700 million.
By the time this transaction took place, Robinson was no longer Pechanga's CFO. In May 2006, Robinson had been hired by the Pechanga tribal government as its CFO. Jerry Konchar, the CFO of PDC, took over as interim CFO of the casino until a permanent replacement could be hired. Robinson told Konchar he was going to continue to handle the casino's insurance, and Konchar apparently agreed to this because he was immersed in an annual audit, which needed to be completed and a report filed with the NIGC, or National Indian Gaming Commission.
The invoice for the premium financing the down payment for the DIC insurance was sent to Robinson. The down payment was $1.16 million. Robinson issued a check request, which was eventually forwarded to Konchar, along with the invoice. Konchar had previously signed off on a check request issued by Robinson for an insurance policy renewal in the amount of approximately $12,500, which he did not question, but he was unwilling to sign off on the request for $1.16 million. Konchar was familiar with property insurance in general, but not with DIC insurance, and he did not understand why it was so expensive. There was no insurance information in Robinson's office, so Konchar was unable to determine the basis for the $1.16 million down payment. Konchar testified that he did not understand why the cost of the DIC insurance had more than doubled from April 2006 to August 2006. In meetings and via e-mails to Konchar, Riley and Robinson explained the reasons that the DIC premium was so high.
Ironically, Riley was able to obtain more DIC insurance in 2006 for the Pechanga casino than almost any of the other tribal casinos in California, and at lower cost per million than most. Accordingly, despite Konchar and Brink's suspicions, there was in fact nothing untoward about the July 2006 transaction involving DIC insurance except, arguably, the size of Riley's fee.
The evidence showed that between 2003 and 2006, Robinson made large payments to Thomas LaValle in connection with gambling activities and some stock purchases. Robinson also lent money to LaValle. Riley testified that Robinson also had large expenses resulting from a divorce.
THE PROSECUTION DID NOT MEET ITS BURDEN OF PROOF WITH RESPECT TO COUNTS 6 THROUGH 9
Section 641.3 provides in relevant part, "Any employee who solicits, accepts, or agrees to accept money or any thing of value from a person other than his or her employer, other than in trust for the employer, corruptly and without the knowledge or consent of the employer, in return for using or agreeing to use his or her position for the benefit of that other person, and any person who offers or gives an employee money or any thing of value under those circumstances, is guilty of commercial bribery." (§ 641.3, subd. (a), italics added.)
In this case, the indictment specifies three dates upon which alleged acts of commercial bribery took place: on or about April 27, 2006 (count 4 as to defendant Riley and count 5 as to defendant Robinson); on or about July 11, 2006 (count 6 as to defendant Riley and count 7 as to defendant Robinson); and on or about August 16, 2006 (count 8 as to defendant Riley and count 9 as to defendant Robinson). Each count alleges that Robinson was on the
In her supplemental brief, the Attorney General asserts that the record shows that Robinson was an employee of "Pechanga" throughout the entire period alleged in the indictment, apparently referring to the Pechanga tribe. She notes that Konchar testified, "[W]e all work for the Tribe." The indictment did not allege that Robinson was an employee of the Pechanga tribe, however; it alleged that he was an employee of Pechanga Resort and Casino. Even if it is true that employees of the casino and of the tribal government do ultimately work "for the Tribe," it is also true that not all employees of the tribe work for the casino. Konchar testified that the Pechanga tribal government was an entirely separate entity from Pechanga Resort and Casino. He described each as an "entity" of the Pechanga tribe, but testified that each had its own physical location and operating structure, and that Robinson's new position as CFO of the tribal government was not a transfer but a new job. He specifically stated that as of May 22, 2006, Robinson "was no longer an employee of the casino." Tjeerd Brink, who became the permanent CFO of the casino after Robinson moved to the tribal government, also testified that working for the tribal government is considered "a complete and separate employment from the Pechanga Resort and Casino." There was no contrary evidence. Accordingly, the undisputed evidence shows that Robinson's change in employment was not an internal transfer within a single organization but rather a new job for a separate legal entity.
The Attorney General also argues that the conclusion that Robinson was "a Pechanga employee" throughout the relevant period is supported by the evidence that even after changing jobs, "Robinson still handled the purchase of property and casualty insurance for the Resort and Casino." She implies that doing so was still Robinson's job. However, at trial, the prosecutor used the fact that Robinson did not work for the casino when he had insurance invoices sent to him at the tribal government office and persuaded Konchar to approve them as evidence that Robinson was improperly exercising his influence to ensure that Riley's allegedly inflated fees and commissions would be paid, even though he had no authority to sign off on insurance for the casino or to approve payment for the casino's insurance. Even if it is true that Robinson was trying to induce Konchar to approve payment of the invoice for DIC insurance for a wrongful purpose — as opposed to attempting to ensure that the casino had an adequate amount of DIC insurance — it was undisputed that Robinson was not an employee of the casino at that time.
SUBSTANTIAL EVIDENCE SUPPORTS THE VERDICTS
Defendants contend that there was insufficient evidence to support the verdicts because (1) there was no evidence that any payment from Riley to Robinson was related to any specific insurance transaction, and (2) there was no substantial evidence that defendants acted with the specific intent to injure or defraud Pechanga.
Underlying defendants' first contention is the assumption that section 641.3 requires evidence of a direct relationship between each bribe and a specific benefit conferred. This is a question not of the sufficiency of the evidence, but of statutory interpretation, i.e., whether the statute requires evidence of a direct quid pro quo. The meaning of a statute is a question of law which we decide de novo. (People ex rel. Lockyer v. Shamrock Foods Co. (2000) 24 Cal.4th 415, 432 [101 Cal.Rptr.2d 200, 11 P.3d 956].)
In reviewing a claim of insufficient evidence, we review the entire record to determine whether it contains substantial evidence to support the judgment or finding in question. (People v. Johnson (1980) 26 Cal.3d 557, 577 [162 Cal.Rptr. 431, 606 P.2d 738].) We review the evidence "`in a light most favorable to respondent and presume in support of the judgment the existence of every fact the trier could reasonably deduce from the evidence.'" (Id. at p. 576.) Substantial evidence is evidence that is reasonable, credible and of solid value, such that a reasonable trier of fact could find the defendant guilty beyond a reasonable doubt. (Ibid.) We do not reweigh the evidence or resolve credibility issues or conflicts in the evidence; those functions are reserved for the trier of fact. (People v. Young (2005) 34 Cal.4th 1149, 1181 [24 Cal.Rptr.3d 112, 105 P.3d 487].)
Here, there is substantial evidence that in return for the numerous payments he received from Riley, Robinson exercised no oversight over the fees Riley charged. The evidence showed that in one instance, Riley obtained a lower premium on a policy than he had originally quoted to the casino, but that instead of giving the casino the benefit of the reduction, he merely added the difference to his own fee. There is no evidence that the additional fee was justified by any additional work performed by Riley to obtain the lower premium. And, there is evidence that in at least one instance, Riley charged
Riley contends that Robinson cannot be faulted for his lack of scrutiny because both Konchar and Brink testified that they did not ask Riley to break
Defendants urge us to consider all of the favorable evidence and the weaknesses in the prosecution's case in determining whether there truly is substantial evidence of specific intent to injure or defraud the casino. Even if we view the evidence in the light most favorable to defendants — which is the opposite of the standard we actually apply (People v. Johnson, supra, 26 Cal.3d at p. 576) — we can at most say that reasonable minds could differ as to whether the prosecution convincingly demonstrated that defendants acted with the necessary specific intent. If our review of the record shows that there is substantial evidence to support the judgment, we must affirm, even if there
The convictions on counts 6, 7, 8 and 9 are reversed for insufficient evidence. The trial court is directed to enter a judgment of acquittal on those counts and to issue amended abstracts of judgment and sentencing minutes, and to provide certified copies of the amended documents to the Department of Corrections and Rehabilitation and to the parties. The judgment is otherwise affirmed.
Ramirez, P. J., and King, J., concurred.
The focus in this case was on insurance transactions for the casino, to which the parties frequently referred simply as "Pechanga."
We granted rehearing and also granted Riley's motion for late transmission of exhibits. Having reviewed the pertinent exhibit, we reject Robinson's contention. Neither the exhibit nor any other portion of the record Robinson cited establishes that the invoice was related to the workers' compensation program. Nor, we should point out, is there any evidence that a fee of over $1 million would have been justified by the amount of work RGA performed in administering that program.
We also reject Riley's argument that the exhibit merely shows the broker fee paid to Affinity Insurance and the agency fee paid to RGA and does not also reflect the premium paid by Pechanga. The exhibit states a "package renewal" in the amount of $1,105,000, a broker fee to Affinity Insurance in the amount of $50,000, and an agency fee to RGA in the amount of $1,055,000, with a total of $2.21 million billed to Pechanga. On its face, the invoice rationally supports the conclusion stated ante.
Robinson also complains that this invoice reflects a transaction in 2004, which is two years earlier than the offense charged in counts 4 and 5 of the indictment. However, neither party disputes the sufficiency of the evidence that Riley made a payment to Robinson on or about April 27, 2006, which is the act alleged in counts 4 and 5. The undisputed evidence showed that on that date, Riley paid Robinson $60,000. As we have discussed ante, the prosecution did not have the burden of proving that in return for the amount Robinson provided a direct benefit to Riley. The evidence that Riley and Robinson engaged in a course of conduct over several years in which bribes were paid and benefits accrued to Riley is sufficient to satisfy the requirements of section 641.3, as long as there is evidence that they acted with the necessary intent.