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United States v. Starr

United States Court of Appeals for the Second Circuit

September 23, 1986, Argued ; April 9, 1987, Decided

Nos. 86-1219, 86-1220

Opinion

 [*95]  MESKILL, Circuit Judge.

This is an appeal from judgments of conviction entered on May 2, 1986, in the United States District Court for the District of Vermont, Billings, J., after a jury trial. The jury returned a verdict of guilty on all counts under a fifteen count indictment charging defendants Charles L. Starr, Jr. and Charles L. Starr, III with mail fraud and wire fraud in violation [**2]  of 18 U.S.C. §§ 1341 and 1343 (1982). 1 The indictment alleged that defendants engaged in a scheme to defraud customers of their so called "lettershoppe" business, American Mailing Systems (AMS), by means of "burying" higher rate mailings in lower rate bulk mailings and failing either to pay the postal service the correct postage due or to refund the excess funds to their customers. This appeal followed. We reverse the judgment of the district court.

BACKGROUND

The principals in this criminal prosecution, Charles L. Starr, Jr. (Charles Starr) and Charles L. Starr, III (Larry Starr), father and son, formed Starr Industries, Inc. in 1981 and shortly thereafter began operating a lettershoppe service for bulk mail customers. In the period covered by the grand jury's indictment, September 4, 1981, through May 1984, the Starrs performed these bulk mailing services under the name American Mailing Systems.

The Starrs had no prior experience in the operation or management of a [**3]  lettershoppe business. To compensate for their shortfall in practical experience, the Starrs hired Douglas Whitaker to work for and advise them in developing their business. Whitaker, an unindicted co-conspirator, testified for the government, describing the Starrs' conduct that supposedly showed a scheme to defraud their customers. 2 

Most of AMS' customers were institutional entities who advertised educational seminars. They sent unsorted, unaddressed mailing brochures to AMS in one bulk shipment. AMS addressed the brochures,  [*96]  then sorted and packaged them for delivery to the post office.

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816 F.2d 94 *; 1987 U.S. App. LEXIS 4936 **

United States of America, Appellee, v. Charles L. Starr, Jr., and Charles L. Starr, III, Defendants-Appellants

Prior History:  [**1]  Appeal from a judgment of conviction entered in the United States District Court for the District of Vermont, Billings, J., on May 2, 1986, upon a jury verdict of guilty under an indictment charging defendants in fifteen counts with mail fraud in violation of 18 U.S.C. § 1341 and wire fraud in violation of 18 U.S.C. § 1343.

Disposition:  Judgment reversed and indictment dismissed.

CORE TERMS

customers, mail, postage, post office, defraud, mail fraud, appellants', indictment, lettershoppe, bargain, promises, funds, fraudulent intent, intent to defraud, representations, colleagues, postal service, scheme to defraud, wire fraud, dissenting opinion, district court, material fact, obtain money, concealed, benefits, postal, nonprofit, imprints, induced, fraudulent pretenses

Criminal Law & Procedure, Standards of Review, Substantial Evidence, General Overview, Fraud, Wire Fraud, Elements, Fraud Against the Government, Mail Fraud, Trials, Burdens of Proof, Prosecution