U.S. v. Zehrbach

Defendants Darus Zehrbach and Alex Mervis appeal from jury verdicts convicting them each of two counts of bankruptcy fraud and one count of conspiracy to commit bankruptcy fraud, in violation of 18 U.S.C. § 152 (1988) and 18 U.S.C. § 371 (1988). In their appeals, Zehrbach and Mervis asserted two grounds for reversal. First, they argued that the district court erred in instructing the jury that the government need not prove, as an essential element of the crime, that they knew their actions to be illegal. Second, they asserted that comments made by the prosecutor in his closing argument, regarding two of the defense witnesses, triggered a rule of per se reversal under United States v. DiLoreto, 888 F.2d 996 (3d Cir. 1990). Their appeals were first heard by a panel of this court. On the basis of the panel decision, Zehrbach and Mervis petitioned for rehearing in banc, which was granted as to both issues. For the reasons that follow, we will overrule our ruling in DiLoreto, insofar as it established a per se rule, and we will affirm the convictions.