State of Minnesota, Appellant,

This opinion is nonprecedential except as provided by
Minn. R. Civ. App. P. 136.01, subd. 1(c).

STATE OF MINNESOTA
IN COURT OF APPEALS
A21-1404

State of Minnesota,
Appellant,

vs.
Peggy Lynn Nelson,
Respondent.

Filed March 28, 2022
Reversed and remanded
Smith, Tracy M., Judge

Otter Tail County District Court
File No. 56-CR-20-695

Keith Ellison, Attorney General, St. Paul, Minnesota; and

Michelle M. Eldien, Otter Tail County Attorney, Benjamin G. A. Olson, Assistant County
Attorney, Fergus Falls, Minnesota (for appellant)

Melvin R. Welch, Welch Law Firm LLC, Minneapolis, Minnesota (for respondent)

Considered and decided by Connolly, Pres iding Judge; Smith, Tracy M., Judge; and
Klaphake, Judge.

NONPRECEDENTIAL OPINION
SMITH, TRACY M., Judge
Appellant the State of Minnesota charged respondent Peggy Lynn Nelson with theft
of movable property based on alleged unauthor ized transactions she made involving her

 Retired judge of the Minnesota Court of A ppeals, serving by appoi ntment pursuant to
Minn. Const. art. VI, § 10.
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employer’s financial accounts. Before trial, the district court issued an order establishing
the jury instructions in the case, and those instructions directed that electronic funds
deposited into a financial account are not “m ovable property” for purposes of the theft
statute. In this pretrial appeal, the state ar gues that the district court’s instructions are
erroneous and that the pretrial order has a critical impact on its prosecution because it will
lead to dismissal of the charge or a judgment of acquittal. We agree, and we reverse and
remand.
FACTS
The criminal complaint alleges that Nelson, an employee at InVision Eye Care, set
up an unauthorized PayPal account that was linked to InVision’s business checking account
and business credit card and that she used that PayPal account to make personal purchases
and to make payments to her son and to herself. The complaint further alleges that Nelson
made an unauthorized withdrawal of funds from InVision’s business account “as a bonus”
and that she added personal time to her employee account without authorization, resulting
in overpayment to her. Based on these alleged actions, the st ate charged Nelson with one
count of felony theft of movable property , in violation of Minn. Stat. § 609.52,
subd. 2(a)(1) (2016).
Before trial, the state submitted proposed ju ry instructions. The district court then
drafted its own proposed jury in structions and sent them to counsel. The relevant portion
of the district court’s proposed instructions read as follows:
The elements of theft are:

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First, the defendant took, us ed, transferred, concealed,
or retained possession of movable property.

“Movable property” is property whose physical location
can be changed.

Intangible property, such as funds deposited in a
financial account or funds accessed using a financial
transaction card, is not “movable property.”

(Emphasis added.)
The first sentence in the pr oposed instructions was drawn from the standard jury
instruction stating the elements of theft. See 10 Minnesota Practice , CRIMJIG 16.02
(2015). The second sentence was the standa rd jury instruction defining “movable
property,” see CRIMJIG 16.77, which mirrors the statutory definition of “movable
property,” see Minn. Stat. § 609.52, subd. 1(2) (2016 ). The third sentence, in italics, was
drafted by the district court to describe its understanding of the law as applicable to this
case.
The state objected to the italicized langua ge. When the district court overruled the
state’s objection, the state informed the district court of its intent to appeal the decision per
Minn. R. Crim. P. 28.04, subd. 2. The district court then issued its written order, confirming
its instructions. In the accomp anying memorandum explaining its reasoning, the district
court stated that, based on its review of caselaw, funds in a financial account do not have a
“physical location” because “[t]hey are bookkeeping entries without any obvious physical
manifestation,” and, because th e funds lack a physical loca tion, their physical location
cannot be moved.
The state appeals.
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DECISION
Critical Impact
As a preliminary matter, we must determine whether we will even reach the merits
of the state’s appeal. Although the rules of criminal proced ure permit the state to seek
appellate review of a pretrial order, see Minn. R. Crim. P. 28.04, subd. 1(1), we will reverse
a pretrial order only if the state can (1) show that the district court’s ruling was erroneous
and (2) “clearly and unequivocally show . . . th at the [district] court’s order will have a
critical impact on the state’s ability to prosecute the defendant successfully.” State v.
Zanter, 535 N.W.2d 624, 630 (Minn. 1995) (quotation omitted); see also State v. Serbus,
957 N.W.2d 84, 87 (Minn. 2021). Critical impact is a threshold issue, and appellate courts
will not review a pretrial order absent such showing of critical impact. See State v. Osorio,
891 N.W.2d 620, 627 (Minn. 2017).
We agree with the state that the critical impact standard is met in this case. All the
“movable property” at issue relates to transactions in financial accounts. As the state
argues, under the district court’s determination of the applicable law, the charge is subject
to dismissal for lack of prob able cause. An order for dismi ssal of a charge satisfies the
critical-impact standard. See State v. Underdahl , 767 N.W.2d 677, 684 (Minn. 2009)
(“[A]n order that dismisses DWI charges, ev en when other charges remain, will have a
critical impact on the prosecution’s case.”); see also Serbus, 957 N.W.2d at 87 (stating that
“[b]ecause the district court dismissed the charge, critical impact is met”). As the state also
asserts, if the case is not dismissed but rather goes to trial, it is s ubject to a judgment of
acquittal; in fact, the district court stated in its pretrial order that “if the State were to
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proceed to a jury on the current Complaint, then Defe ndant could move for a directed
verdict at the close of the State’s case, and the Court would grant th is motion as a matter
of law.” An acquittal as a matter of law clea rly would also have a critical impact on the
state’s prosecution.
Nelson argues that, because the state could charge her under alternative theories of
theft other than movable-property theft, such as theft by false representation, see Minn.
Stat. § 609.52, subd. 2(a)(3)(i) (2016), theft by swindle, see id., subd. 2(a)(4) (2016), or
theft of corporate property, see id. , subd. 2(a)(15) (2016), the state has not shown any
critical impact. But this argument misses the mark. What matters in our consideration of a
pretrial ruling’s critical impact is whether the ruling has a critical impact on the current
charge. See Underdahl, 767 N.W.2d at 684. Here, the pretrial ruling will lead to dismissal
of the theft-of-movable property charge against Nelson or an acquittal as a matter of law.
The state has established the ruling has a critical impact on the state’s ability to prosecute
its case.
Jury Instructions
With the threshold for reviewing the pretrial order satisfied, we turn to the merits of
the state’s appeal. The state argues that the district court erred in how it defined “movable
property,” contending that the district court’s definition is contrary to the plain language of
section 609.52, subdivision 1(2). We agree.
Generally, we review “a district court’s jury instructions for an abuse of discretion.”
State v. Stay , 935 N.W.2d 428, 430 (M inn. 2019) (citation and quotation omitted). “A
district court abuses its discretion if it fails to properly instruct the jury on all elements of
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the offense charged.” Id. “An instruction is in error if it materially misstates the law.” State
v. Kuhnau , 622 N.W.2d 552, 556 (Minn. 2001) (citation omitted). Here, the issue is
whether the district court properly defined a statutory term in its proposed jury instructions.
This is a question of statutory inte rpretation that we review de novo. See State v.
Thonesavanh, 904 N.W.2d 432, 435 (Minn. 2017).
The object of statutory interpretation is to “ascertain and effectuate the intention of
the legislature.” Minn. Stat. § 645.16 (2020); see also Roberts v. State, 945 N.W.2d 850,
853 (Minn. 2020). We apply the plain meaning of a statutory provisi on if the legislative
intent “is clear from the unambi guous language of the statute.” Staab v. Diocese of St.
Cloud, 853 N.W.2d 713, 716-17 (Minn. 2014). “When the wo rds of a law in their
application to an existing situation are clear and free from all ambiguity, the letter of the
law shall not be disregarded under the pretext of pursuing the spirit.” Minn. Stat. § 645.16.
“A statute is to be enforced literally as it reads, if its language embodies a definite meaning
which involves no absurdity or contradiction.” Arlandson v. Humphrey, 27 N.W.2d 819,
823 (Minn. 1947) (quotation omitted).
Under the relevant provision of the theft statute, a person commits theft when they
“intentionally and without clai m of right take[], use[], transfer[], conceal[] or retain[]
possession of movable property of another without the other’s consent and with intent to
deprive the owner permanently of possession of the property.” Minn. Stat. § 609.52, subd.
2(a)(1) (emphasis added). Movable property is defined as “prope rty whose physical
location can be changed, including without limitation things growin g on, affixed to, or
found in land.” Id., subd. 1(2). From this statutory definition, the district court determined
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that “intangible property, such as funds deposited in a financial account or funds accessed
using a financial transaction card” do not qualify as “movable property.”1
A plain reading of the statute does not suppor t the district court’s conclusion that
the funds were immovable property. For property to be “movable,” the property’s physical
location must be able to be changed. Id. While funds deposited in a checking account are
not stored as physical currency, the fund s representing that currency can move from
account to account. When an account holder transfers funds from one account to another,
the funds physically move into the new account even though they were not touched.
The state presents a persuasive example illustrating this point. Because withdrawn
funds become currency—which is movable pr operty—the funds themselves must be
movable property before their withdrawal. He re, InVision deposited currency into its
business account. Then, when Nelson allegedl y transferred the funds electronically, she
could have w ithdrawn the funds from her personal ch ecking account as currency. In
addition, assuming that Nelson’s personal account was at a different bank than InVision’s

1 We pause to address the use of the term “intangible” in the district court’s instruction. As
noted above, Nelson argues that the state coul d charge her under a different provision of
the theft statute rather than the movable-property provision. Each of the provisions that
Nelson cites requires the theft of “property.” See Minn. Stat. § 609.52, subd. 2(a)(3)(i)
(theft by false representation), subd. 2(a)(4) (t heft by swindle), subd. 2(a)(15) (theft of
corporate property). “Property” is defined by the statute as “all forms of tangible property.”
Id., subd. 2 (2016) (emphasis added). By arguing that these other provisions of theft apply,
Nelson necessarily concedes that the funds qualify as “property” and were thus “tangible.”
Though the district court stat ed that it was using the word “intangible” simply as a
“descriptive term” to a ssist the jury, we observe that using the term “intangible” might
confuse the jury about whether the funds are, in fact, “property,” a matter that does not
appear to be at issue in the case.
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account, the funds would have had to move from one bank to another before Nelson could
withdraw the funds as currency.
Nelson’s arguments that the district cour t properly interpreted section 609.52,
subdivision 1(2), are unpersuasive. Nelson argues that, because the definition of “movable
property” is narrower than the definition of “property,” “movable property” must exclude
certain property and thus must exclude the property here. But the statute already excludes
some “property” from “movable property”—under the statute, real property is not movable
property. See id., subd. 1(1) (2016). Thus, while “movable property” is a narrower category
than “property,” Nelson’s argument that “m ovable property” must exclude the property
here is unavailing.
Nelson also argues that the principle that a statute must be construed to give effect
to all of its provisions leads to the conclusion that the property is not “movable property”
because other provisions under the statute “c ould encompass the conduct alleged” in this
case. It is true that we must interpret a statut e “to give effect to al l its provisions.” Minn.
Stat. § 645.16. But the fact that conduct mi ght qualify as theft under more than one
provision of the theft statute (a fact that Nelson concedes by citing several provisions that
could apply) does not mean that our interpretation of the movable-property definition does
not give effect to all of the statute’s provisions.
We conclude that the district court erred when it classified the funds as non-movable
property in its proposed jury instructions. We therefore reverse the pretrial order and
remand for further proceedings.
Reversed and remanded.