Sunday, September 13, 2015

Case o' The Week: Ninth OK with (Account Expert) Lay -- Aubrey and (Non)-Expert Accountant Opinion

  He could have been admitted as an expert, but instead the government accountant testified as a lay witness.
  He could have shown the evidence of misappropriation, but instead the government accountant showed a “summary chart” that became the evidence.
   Coulda, shoulda, woulda . . .
United States v. Aubrey, 2015 WL 5201800 (9th Cir. Sept. 8, 2015), decision available here.

Players: Decision by Judge N.R. Smith, joined by Judges O’Scannlain and Ikuta. Hard-fought appeal by Chief Ass’t Michael Kennedy, and Defender Rene Valladares, D. Nev. FPD.  

Facts: HUD allocates money to Indian tribes to construct affordable housing. Id. at *1. Aubrey was a contractor whose companies built houses on Indian lands. Id. at *2. He received HUD funds for a housing project, and placed them in a comingled account with his own funds. Id. at *3. Id. His subcontractors who did authorized work on Indian housing did not receive the payments cut by HUD; payments that had wound their way to Aubrey. Id. He was charged with conversion and misapplication of tribal funds. Id. at *4. At his trial, a HUD forensic accountant testified, introduced summary charts tracing the movement of funds, and explained he had used the “last-in-first-out” accounting method. Id. at *4. The accountant – who had not been admitted as an expert – testified over defense objection. Id. Aubrey was convicted. Id. at *5.

Issue(s): “Aubrey argues that the district court erred in admitting [the accountant’s] testimony as summary testimony and by admitting the summary exhibits, because he was not certified as an expert witness.” Id. at *5.

Held: “[The accountant] was not required to be certified as an expert. [The accountant] testified about his own personal investigation . . .  in his capacity as a HUD auditor in accordance with [FRE] 701. Although [the accountant] might have been eligible to be certified as an expert, the district court properly restricted his testimony to the areas in which he had personal knowledge (the documents, investigation, and the methods he used to prepare his summary) and prevented him from providing in-depth analysis of various accounting methods. Simply because [the accountant] stated that he used ‘last-in-first-out’ to construct his summary charts did not transform his testimony into expert testimony. Instead, [the accountant] was merely providing foundation for the evidence he was presenting. Further, when [the accountant] was prompted by the prosecution to discuss the merits of the “last-in-first-out” accounting method, the district court properly prevented [the accountant] from answering, as that sort of testimony could stray into the realm of expert testimony. Accordingly, two passing references to the ‘last-in-first-out’ method (when explaining his own procedure in constructing the charts) is not sufficient to require the district court to certify [the accountant] as an expert witness.” Id. at *11.

Of Note: A parallel issue was the use of summary charts, under FRE 1006. Id. at *11. The accountant prepared these charts after going through bankers boxes of evidence. Id. The Court upheld admission of these charts as evidence, because the underlying docs were (apparently) admissible (though not admitted?), were given to the defense, there was no objection as to accuracy, and there was a pattern limiting instruction. Id. Important to note, though, that the Court resorts to plain error analysis because there was no objection to the charts below. Id. at *12. This seems a squirrely and dangerous area of evidence: the jury is instructed that the charts are “only as good as the underlying supporting material,” but the jury is never actually given the underlying supporting material to evaluate. The Ninth’s Pattern Instruction4.16 could use some work: maybe a requirement that supporting docs referenced in a summary chart must actually be admitted and made available to the jury?

How to Use: It is bad enough when a gov’t agent (cop) testifies as both a lay witness and expert. See, e.g., Torralba-Mendia, 784 F.3d 652 (9th Cir. 2015), blogged here Aubrey is worse: this accountant should have gone through qualifying as an expert, but wasn’t offered as an expert at all. Fortunately, the Ninth emphasizes the court’s limitations on explanations of accounting procedures – a limitation to emphasize when faced with this type of witness.
For Further Reading: This case is big news, with downstream consequences, in the Navajo Nation. See Navajo Times article here.  

Image of cufflinks from

Steven Kalar, Federal Public Defender N.D. Cal. Website available at


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