## Facts

- James Montgomery and his wife, Louise, operated Sun Village Realty, Inc., a vacation-home realty and property-management business in Oregon; the business provided rental management and issued monthly mailed “owners’ statements” reflecting rental activity and charges.
- The reservation system used both a wall calendar and a computer; reservations not entered into the computer did not appear on the owners’ statements.
- After James’s sister, Mary O’Connor, assumed office and accounting functions, owners complained of discrepancies between reported rentals and amounts shown on mailed statements.
- The government alleged that Montgomery and O’Connor concealed rental proceeds by booking rentals without computer entry, used owners’ homes without consent or compensation, and omitted certain rental income from statements.
- A federal investigation resulted in an indictment charging Montgomery, O’Connor, and Louise with conspiracy and mail fraud; Louise cooperated, testified for the government, and charges against her were dismissed.
- At trial, over Montgomery’s objection, the government introduced a letter from Louise to Montgomery and related evidence concerning their private communications about suspected wrongdoing.
- A jury convicted Montgomery of conspiracy (18 U.S.C. § 371) and five counts of mail fraud (18 U.S.C. § 1341), and convicted O’Connor of conspiracy and two counts of mail fraud; both received prison terms and joint-and-several restitution.

## Issues

1. Whether the district court improperly admitted confidential marital communications over Montgomery’s marital-communications-privilege objection, and, if so, whether the error was harmless.
2. Whether the evidence was sufficient to sustain the conspiracy and mail-fraud convictions, particularly as to O’Connor’s knowing participation and intent.
3. Whether the indictment, the admission of a summary exhibit under Federal Rule of Evidence 1006, or sentencing determinations (including loss and restitution calculations) required reversal or remand.

## Decision

- Montgomery’s convictions were reversed because the district court admitted privileged marital communications, and the error was not harmless.
- O’Connor’s convictions were affirmed; the court found sufficient evidence of a fraudulent scheme and use of the mails to execute it.
- O’Connor’s sentence was vacated and remanded for resentencing based on identified sentencing errors; Montgomery’s sentencing issues were mooted by reversal.

## Legal Principles

- Confidential communications between spouses made during a valid marriage are privileged if intended to be private when made; the privilege survives the end of the marriage.
- Later disclosure of a confidential marital communication by one spouse does not automatically extinguish the other spouse’s ability to invoke the privilege.
- A “joint criminal enterprise” or crime-fraud type exception requires a showing that the marital communication was made to further or conceal criminal conduct; discussions expressing suspicion or concern are not enough without that showing.
- Mail fraud requires proof of a scheme to defraud and use of the mails for the purpose of executing the scheme; mailed periodic account statements can satisfy the mailing element when used to carry out concealment.
- Rule 1006 permits summary exhibits of voluminous records where the underlying materials are available and the summary’s admission is within the trial court’s discretion.

## Conclusion

The Ninth Circuit held that admitting a spouse’s confidential letter and related marital communications against Montgomery violated the marital communications privilege and substantially affected the verdict, requiring reversal, while evidence independently supported O’Connor’s conspiracy and mail-fraud convictions; her sentence, however, required remand for resentencing.


United States v. Montgomery, 384 F.3d 1050 (9th Cir. 2004)