## Facts

- William D. Pierce served as executive officer of Right Step Academy, a Minnesota charter school; Shirley Best Pierce served on the school’s board.
- The school received state and federal funding and was subject to public-school audit and financial oversight requirements.
- The Pierces, as officers/directors, owed fiduciary duties under Minnesota nonprofit law.
- While operating the school, the Pierces engaged in self-dealing, including using an entity they controlled (Right Group) to route school funds for personal benefit.
- They used sham invoices and treated personal expenses as school/business expenses.
- Diverted funds were not properly reported on their federal tax returns.
- Audits identified major operational and financial problems, and the school ultimately closed.
- A federal jury convicted both defendants of conspiracy, filing false tax returns, mail fraud, and wire fraud; the district court imposed prison terms and ordered $489,239.65 restitution to the State of Minnesota.

## Issues

1. Whether the district court’s Pinkerton instruction improperly directed a verdict by stating the jury “should” (rather than “may”) find a conspirator guilty of foreseeable substantive offenses committed by a co-conspirator in furtherance of the conspiracy.
2. Whether the district court abused its discretion by denying a requested special verdict form and relying instead on a unanimity instruction.
3. Whether the district court abused its discretion in ordering $489,239.65 in restitution to the State of Minnesota based on the proof of loss.

## Decision

- The Eighth Circuit affirmed the convictions and restitution order.
- The “should find” Pinkerton instruction was not reversible error because, read with the full charge, it did not misstate the law or relieve the government of proving elements beyond a reasonable doubt; any arguable wording defect was harmless.
- The district court did not abuse its discretion in denying a special verdict form where a specific unanimity instruction adequately protected the defendants’ rights.
- The restitution amount was supported by a preponderance of the evidence, including audit and agency evidence; imprecision in loss calculation was attributable to the defendants’ inadequate recordkeeping.

## Legal Principles

- Under Pinkerton, a conspirator may be held liable for a co-conspirator’s substantive offense if the defendant was a member of the conspiracy, the offense was committed in furtherance of it, and the offense was reasonably foreseeable.
- Jury instructions are evaluated as a whole; wording that is potentially directive does not require reversal absent a realistic risk of misleading the jury, shifting burdens, or removing factfinding from the jury, and any error is subject to harmless-error review.
- Criminal special verdict forms are generally disfavored and are not required where a proper unanimity instruction and element-by-element instructions ensure a unanimous verdict.
- Restitution must be supported by a preponderance of the evidence; the district court may use reasonable estimates grounded in the record, especially when the defendant’s conduct makes precise calculation difficult, and the award is reviewed for abuse of discretion.

## Conclusion

The Eighth Circuit upheld the Pierces’ fraud- and tax-related convictions connected to charter-school self-dealing, concluding that the Pinkerton instruction language did not warrant reversal, the refusal of a special verdict form fell within the district court’s discretion, and the restitution award was adequately supported by audit-based loss evidence despite recordkeeping failures attributable to the defendants.


United States v. Pierce, 479 F.3d 546 (8th Cir. 2007)