United States v. Kyle Grasso

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

UNITED STATES OF AMERICA, No. 10-50116 Plaintiff-Appellee, D.C. No. v. 2:07-cr-00755-

DDP-

KYLE JOHN GRASSO,

Defendant-Appellant. OPINION

Appeal from the United States District Court for the Central District of California Dean D. Pregerson, District Judge, Presiding

Argued and Submitted December 6, 2012—Pasadena, California

Filed July 26, 2013

Before: Marsha S. Berzon, Sandra S. Ikuta, and Jacqueline H. Nguyen, Circuit Judges.

Opinion by Judge Ikuta; Partial Concurrence and Partial Dissent by Judge Berzon SUMMARY*

Criminal Law

The panel affirmed convictions for money laundering, bank fraud, loan fraud, and conspiracy to commit loan and bank fraud stemming from a Los Angeles-based scheme to defraud mortgage lenders.

Affirming the conspiracy conviction, the panel held that the government presented more than sufficient evidence that the defendant knew the objectives of the fraudulent scheme.

Affirming the loan fraud convictions, the panel held that a jury could reasonably (1) conclude that the defendant knew that his false…

*1081 OPINION

Kyle Grasso appeals his convictions for money laundering, bank fraud, loan fraud, and conspiracy to commit loan and bank fraud, stemming from a Los Angeles-based scheme to defraud mortgage lenders. We conclude that the evidence adduced at trial, taken in the light most favorable to the government, was adequate to enable a rational trier of fact to find the essential elements of each conviction. See United States v. Nevils, 598 F.3d 1158, 1163-64 (9th Cir.2010) (en banc). Accordingly, we affirm on all counts.

I

We have already explained how this scheme operated in United States v. Rizk, 660 F.3d 1125 (9th Cir.2011) (affirming conviction of Lila Rizk, a real estate appraiser in the scheme and one of Grasso’s co-defendants). Therefore, we provide only a brief overview of the scheme before detailing the particular aspects relevant to Grasso’s appeal.

A

The scheme, as crafted by Mark Abrams, a mortgage broker, and Charles Elliott Fitzgerald, a real estate developer, took advantage of the real estate frenzy of the early 2000s. The conspirators would enter into a purchase agreement for a home in an exclusive Westside Los Angeles community, and then obtain a loan for…

concurring in part and dissenting in part:

I concur in Parts I and II.A-C of the panel’s opinion but write separately with regard to Part II.A and respectfully dissent from Part II.D.

I.

The Reed case relied on in Part II.A of the panel’s opinion says the following: “Once a conspiracy is established, only a slight connection to the conspiracy is necessary to support a conviction. The term ‘slight connection’ means that a defendant need not have known all the conspirators, participated in the conspiracy from its beginning, participated in all its enterprises, or known all its details. A connection to the conspiracy may be inferred from circumstantial evidence. Innocent association, even if it is knowing, does not amount to a ‘slight connection.’ ” United States v. Reed, 575 F.3d 900, 924 (9th Cir.2009) (internal citations, quotation marks, and alterations omitted); see Maj. Op. at 1086. The majority relies on Reed , and, although it slightly paraphrases the language of the opinion, I understand the majority opinion to incorporate Reed’s holding concerning the limited import of the “slight connection” locution. I therefore concur in Part II.A of the opinion.

I nonetheless write…