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Circuit Court: Spreadsheets OK as evidence

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A Terre Haute company and its president lost an appeal of their convictions and sentence for making materially false statement reports under the Clean Water Act.

In United States of America v. Derrik Hagerman and Wabash Environmental Technologies, LLC, Nos. 07-3874, 07-3875, Derrik Hagerman argued the District Court erred in admitting into evidence copies of certain electronic spreadsheets that recorded test results of waste liquid that weren't charged in indictment. Hagerman believed the test results are evidence of prior bad acts that should have been excluded under Fed. Rule of Evid. 404(b).

Wabash Environmental treated industrial liquid waste and discharged the treated liquid into the Wabash River. The company was required to make monthly reports disclosing the test results of the waste using EPA-approved procedures.

The spreadsheets in question in the appeal cover the same period of time that Hagerman and his company were charged with misrepresenting results of tests. It would have been infeasible to separate out the evidence to eliminate any hint that Hagerman had also falsified other test results, wrote the 7th Circuit in the per curium opinion. The judges also dismissed Hagerman's argument that by admitting those spreadsheets, which showed misconduct not charged in the indictment, the District Court allowed the indictment to be "constructively amended."

The 7th Circuit affirmed the District Court judge's jury instruction on the requirement Hagerman was to certify each report was accurate and complete by using language from Wabash Environmental's discharge permit. Hagerman believed it should be up to the jury to determine whether Wabash Environmental had a system in place to ensure the test results were properly gathered and evaluated.

"The judge's instruction that the testing methods must 'conform to applicable federal regulations' was a correct interpretation of the permit, and the meaning of the permit presented an issue of law that the judge was entitled to determine, rather than leave to the jury," wrote the court.

The 7th Circuit also upheld Hagerman's 60-month prison sentence over Hagerman's arguments that imprisonment will make paying restitution difficult and that he's made considerable contributions to his community.

In September 2008, Hagerman's appeal of the District Court's dismissal of the government's petition for relief after Wabash agreed to start paying restitution and furnish specific financial information was dismissed because Hagerman and Wabash Environmental weren't represented by an attorney. The 7th Circuit ruled owners of limited liability companies must have an attorney to appeal a decision in federal court.

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  1. Well, maybe it's because they are unelected, and, they have a tendency to strike down laws by elected officials from all over the country. When you have been taught that "Democracy" is something almost sacred, then, you will have a tendency to frown on such imperious conduct. Lawyers get acculturated in law school into thinking that this is the very essence of high minded government, but to people who are more heavily than King George ever did, they may not like it. Thanks for the information.

  2. I pd for a bankruptcy years ago with Mr Stiles and just this week received a garnishment from my pay! He never filed it even though he told me he would! Don't let this guy practice law ever again!!!

  3. Excellent initiative on the part of the AG. Thankfully someone takes action against predators taking advantage of people who have already been through the wringer. Well done!

  4. Conour will never turn these funds over to his defrauded clients. He tearfully told the court, and his daughters dutifully pledged in interviews, that his first priority is to repay every dime of the money he stole from his clients. Judge Young bought it, much to the chagrin of Conour’s victims. Why would Conour need the $2,262 anyway? Taxpayers are now supporting him, paying for his housing, utilities, food, healthcare, and clothing. If Conour puts the money anywhere but in the restitution fund, he’s proved, once again, what a con artist he continues to be and that he has never had any intention of repaying his clients. Judge Young will be proven wrong... again; Conour has no remorse and the Judge is one of the many conned.

  5. Pass Legislation to require guilty defendants to pay for the costs of lab work, etc as part of court costs...

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