Submitted: March 18, 2016
Appeal from United States District Court for the District of North Dakota - Fargo
Before MURPHY, BEAM, and GRUENDER, Circuit Judges.
MURPHY, CIRCUIT JUDGE.
A jury convicted Aaron Johnson of conspiracy to defraud the United States in violation of 18 U.S.C. § 371, making false statements to influence the United States Department of Agriculture (USDA) in violation of 18 U.S.C. §§ 2 and 1014, and making false statements to law enforcement in violation of 18 U.S.C. § 1001. The district court sentenced Johnson to 48 months in prison after applying sentencing enhancements based on obstruction of justice and the total loss amount. Johnson appeals his convictions and sentence. We affirm.
Johnson and his brother were potato farmers in North Dakota. The Risk Management Agency of the USDA administered a crop insurance program by which the Johnsons obtained insurance coverage for shortfalls between their annual potato production and a production baseline. Their insurance policies also covered damage from "soft rot" (the watery breakdown of the inner potato) to their stored crops. The Farm Service Agency of the USDA also administered a crop disaster program authorizing payments to farmers for crop losses sustained during particular years. Each of these federal programs covers only losses resulting from certain natural occurrences, not from intentional acts by an insured.
In November 2006 the Johnsons filed notices of loss under their insurance policies. An adjuster inspected Aaron Johnson's stored potatoes at a warehouse near Cooperstown, North Dakota (the Cooperstown warehouse) and determined that soft rot had caused a total loss of that crop. Johnson and his wife also later applied for disaster relief based on that loss. In his insurance claim and disaster relief application, Johnson certified that his potato crop had been damaged by naturally occurring soft rot. The government ultimately paid out several hundred thousand dollars in indemnity and disaster relief.
The USDA investigated Johnson for fraud, suspecting he had intentionally damaged the potatoes at the Cooperstown warehouse. Johnson was later indicted on one count of conspiracy to defraud the United States, 18 U.S.C. § 371, two counts of making a false statement to influence the USDA, id. §§ 2, 1014, and two counts of making a false statement to law enforcement, id. § 1001. The evidence at trial established the following facts.
Johnson's employee Leo Borgen had served as a paid informant in the government's investigation of Johnson. Borgen testified that at Johnson's direction in 2006 he had sprayed the potatoes at the Cooperstown warehouse with Rid-X and Flush, chemicals used to break down solids in septic systems. Johnson had also instructed him to add frozen potatoes to the stored potato piles and to turn up the heat in the warehouse. As a result, the potatoes began to rot. Borgen further testified that Johnson had directed him to damage prior potato crops by similar means. On cross examination, Borgen admitted that he had a long criminal history and that the prosecution had dropped charges against him in exchange for his testimony against Johnson. He also admitted that he had "double crossed" investigators by revealing to Johnson that he was a government informant.
Other witnesses testified that Johnson had told them he intentionally damaged his crop using Rid-X and frozen potatoes. The government also introduced evidence showing several large purchases of Rid-X and Flush at hardware stores in Grand Forks and Cooperstown, North Dakota shortly before Johnson submitted his notice of loss. One of those purchases had been made with Johnson's credit card. The government also introduced expert testimony that application to potatoes of septic products, frozen potatoes, and heat would accelerate rotting. The government's expert also explained that the damage to the stored potatoes could not have resulted from an infection caused by the dirt floor of the warehouse as Johnson claimed.
The jury convicted Johnson on all counts. At sentencing, the district court calculated a base offense level of seven and applied a fourteen point enhancement for a total loss amount of between $400, 000 and $1 million. The court also added two points each for Johnson's role as a leader and for obstruction of justice based on two conversations between Johnson and Borgen. First, the court found that Johnson had attempted to induce Borgen to testify favorably during a phone call in which he said he planned to sue the federal government for $30 million and would "remember [his] friends" during that lawsuit. The court also found that the two men had staged a conversation they knew the government was monitoring, intending to obstruct the government's investigation. A total offense level of 25 was calculated, and Johnson was sentenced to 48 months after a downward variance was applied. Johnson appeals the sufficiency of the evidence supporting his conviction, as well as the district court's application of sentencing enhancements based on obstruction of justice and the total loss amount.
We review a challenge to the sufficiency of the evidence de novo, viewing the evidence in the light most favorable to the verdict, accepting all reasonable inferences supporting it, and affirming "if there is any interpretation of the evidence that could lead a reasonable-minded jury to find the defendant guilty beyond a reasonable doubt." United States v. Scofield, 433 F.3d 580, 585 (8th Cir. 2006). The parties agree that the key issue on appeal is whether sufficient evidence showed ...