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United States v. Clark

United States District Court, D. Nebraska

April 22, 2014

JAMES M. CLARK, Defendant.


JOSEPH F. BATAILLON, District Judge.

This matter is before the court on defendant's objections, Filing No. 59, to the findings and recommendation of the magistrate judge, Filing No. 58, on the defendant's motion to dismiss, Filing No. 40. The defendant is charged with embezzling funds from the Westside Community School District ("the District"). Filing No. 1, Indictment. The magistrate judge recommended that this court deny the defendant's motion to dismiss, finding, as a matter of law, that the acts of the school district were not attributable to the government. Filing No. 58, F&R at 2. The defendant objected to those findings, contending that he was entitled to a hearing on the issue. This court agreed and an evidentiary hearing was held on February 25 and 26, 2014.

In his motion to dismiss, Clark contends that his due process rights have been violated in that evidence that would prove his innocence has been destroyed. He argues that the destruction of evidence is attributable to the government.


Three file folders containing records that the defendant maintained in connection with his duties as Westside Community School District's accountant are at issue. One was a file containing records of gift cards purchased at Nebraska Furniture Mart ("NFM"). Testimony adduced at the hearing showed that the NFM file had been located in the office of the defendant's former supervisor, Dr. Allan J. Inzerello. Another was a red expandable folder that contained credit card statements and receipts of purchases of office supplies, etc., which was kept in the vault ("the Discover Card file"). Last, there was a file that contained a running tally of baked goods that the defendant had purchased for office events such as birthday and retirement parties (the "bakery-barter" file). The defendant kept the bakery-barter file in a cupboard above his desk.

At the hearing, Jean Davis, a retired secretary to the Superintendent of the District, testified that she had worked in the payroll and accounts payable department with defendant Clark until April 2007, when she retired. She testified that Dr. Inzerello, former Assistant Superintendent of the District, retired shortly before she did. He was replaced by Dr. Sue Evanich, and Davis then worked for Dr. Evanich.

She testified she worked in the District's Administration Building. She also stated that there were often parties in the Administration Building for employees' birthdays and retirements. Cakes were generally purchased for those events and for other functions. She testified defendant Clark's wife worked at the bakery at Hy-Vee grocery store and would make the cakes. She testified the business department paid for the cakes. She stated there was a record of the purchases-Clark would pay for the cakes and kept a running total. The records were maintained in a file folder in a cabinet above Clark's desk. She stated the file was a regular-colored manila folder with probably about 10 to 12 sheets of lavender notepaper inside it. There were handwritten numbers in a column on the pages.

Davis also testified that the district had a policy of giving employees NFM gift cards on some occasions. She stated Dr. Inzerello gave her a gift card once and he also told her that he had given NFM gift cards to maintenance men. She also testified that defendant Clark had been compensated with an NFM gift card when he returned early from a vacation to work on a project. She testified that records of the NFM gift card purchases were kept in a blue folder in Dr. Inzerello's office.

She also testified that the District had an account with Sam's Club. At one time, ten employees had Sam's Club cards and could purchase District supplies there. At some point, Sam's Club recommended switching to a Discover Card that could be used at stores other than Sam's Club. Defendant Clark then asked the other employees to turn in their Sam's Club cards and a Discover card was issued to Clark.

She testified that the monthly statements for that Discover card were kept in a red expandable folder in the vault. She described it as an accordion expandable file, four to five inches thick.

Jim Clark was terminated in the spring of 2010. Davis stated that she has no personal knowledge of what files were in his office after she left in 2008. She did not know where the files were on March 30, 2010.

Rick Jaworski testified that he was employed by the District as a custodial engineer from 1976 to 2011. He stated that one of his duties was to purchase or pick up paper towels, Kleenex, hand-sanitizer, pop, water, and other District supplies. Clark accompanied him at times and they went to Sam's Club for larger quantities. He would also pick up phones, furniture, carpet, televisions, etc., at NFM.

He stated that he remembers a red folder. If he bought anything with cash, he would bring in the receipt and Jim Clark would put it in the red folder. He would then be reimbursed for the things he had purchased. Jaworski also testified that he received a NFM gift card when he retired.

Another of Jaworski's responsibilities was scheduling the shredding of District documents and records, which was generally done each year in May or June. Jaworski testified that Bob Zagozda replaced Clark. At first, Zagozda worked in a cubicle, but later moved into Clark's former office. Clark's office was later emptied and he was told by Zagozda to call the shred truck. Thereafter, Jaworski saw 8 to 10 boxes stacked up in the hallway. He arranged for shredding after checking with a supervisor that he was authorized to do so. The shredding occurred on September 13, 2010. See Ex. 101, Invoice and Certificate of Destruction from InfoSafe Shredding, Inc.; Reference #10480, dated 9/13/10. The invoice shows that two 64-gallon containers of documents were shredded. Id.

Jaworski testified that the files that were shredded were folders with tabs in binders. He took them out of the binders, threw them in a bankers box, and then into the dumpster. He stated he saw sticky tabs or yellow Post-its with handwritten notations on the documents.

Jaworski also testified that Clark often brought cakes or other baked goods to the office and Jaworski would help carry them in. He also testified he never saw defendant Clark buy any personal items, all were purchased for the District.

Jaworski also testified that while he worked for the District, he normally ate lunch in the office downstairs, and had opened a drawer with Westside Community Schools Foundation documents in it. After Clark's termination, he came in one day and all of the documents were gone.

Dr. Alan J. Inzerello, the former Assistant Superintendent of the District, and Clark's direct supervisor until 2007, also testified. He testified he started working for the school district as a student teacher in 1969 and retired in 2007. He testified to the District's practice of providing refreshments such as baked goods for meetings- including staff development meetings, parent meetings, morning breakfast meetings- and for retirements, holidays and birthdays. Routinely, sheet cakes were purchased for these events. He stated that Jim Clark and his wife regularly furnished the baked goods. He testified that he assumed Clark was compensated through a reimbursement procedure that had been in place before Dr. Inzerello became Assistant Superintendent.

Dr. Inzerello explained the relationship between the District and the Westside Community Schools Foundation ("the Foundation") and the Early Childhood Development ("ECD") Center. The District, in association with the community, formed the Foundation long ago to provide philanthropic support to the District in the form of grant applications, staff development, and funding for buildings such as a performing arts facility. The Foundation also created the ECD Center, which provides prekindergarten classes in the District's buildings. The Foundation exists only to support the District.

He also stated that the District's former policy of giving employees a VCR, DVD player, or TV, at retirement, had evolved over the years to the practice of giving NFM gift cards. He stated gift cards were regularly purchased at NFM by the District. Further, he testified that the District would contribute to the Foundation's fundraising events, such as the golf tournament, and that these prizes were often purchased at NFM. Prizes for staff-recognition golf tournaments and end-of-the-year celebrations were also purchased at NFM. He testified that NFM gift cards ...

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