September 2011 Archives

September 30, 2011

The Ninth Circuit Holds That Once The Government Is Done Investigating You, You Get To See The Warrant That Let Them Into Your House

If you have had a search warrant executed at your house, you're likely to want to know why. If you committed a crime, perhaps it's obvious why. If not, you'd likely want to see why the government thought you were up to something suspicious.

Christopher Kortlander was in exactly that situation. In 2005 and 2008 the federal government got a warrant and searched his house. He was under investigation, as the Ninth Circuit put it, for unlawfully attempting to sell migratory bird parts and for fraudulently misrepresenting the provenance of historical artifacts for sale."

Ultimately, the government declined to go forward with charges.

Mr. Kortlander wanted to see the search warrant. Federal Rule of Criminal Procedure 41(i) requires that search warrants, and related documents, be kept in the clerk's office of the district court that they are issued from.

So, Mr. Kortlander asked that district court for copies of those documents.

The United States government opposed that request. It argued that the documents contained information that was collected by the grand jury and, therefore, was secret.

Mr. Kortlander pointed out that he had already seen the information, with his lawyer, during the investigation.

The government then removed it's objection and said, instead, that it was ok for Mr. Kortlander to see the documents, but only if Mr. Kortlander agrees to "limit dissemination of the material to Kortlander's personal review and/or for inclusion in any future court filings." In support of this restriction, the government said that "concerns have been raised that information collected by Kortlander may be posted on web sites."

You have to admire the use of the passive voice.

The district court, exercising its independent control over the documents that were in its clerk's office, adopted the government's suggestion without making any findings to support a restriction of Mr. Kortlander's ability to distribute the documents.

Mr. Kortlander appealed, and the Ninth Circuit reversed in United States v. Kortlander.

The court of appeals explained that there are two rights of access to court documents - a right under the common law and a First Amendment right. The appellate court held that the common law right required disclosure without restriction. It did not reach the First Amendment argument.

The Ninth Circuit started by observing that

Whether the common law right of access applies to warrant materials after an investigation has ended is a question of first impression in this circuit. We have held that the common law right of access does not apply to warrant materials "during the pre-indictment stage of an ongoing criminal investigation." Id. at 1221. But we expressly reserved whether the common law right of access applies to warrant materials after "an investigation has been terminated." Id. We answer that question today, and hold that, as the government concedes, the common law right of access applies under these circumstances. In doing so, we join a number of courts that have reached the same conclusion. See, e.g., In re EyeCare Physicians of Am., 100 F.3d 514, 517 (7th Cir. 1996); In re Newsday, Inc., 895 F.2d 74, 79 (2d Cir. 1990); Baltimore Sun Co. v. Goetz, 886 F.2d 60, 62 (4th Cir. 1989); United States v. Wells Fargo Bank Account Number 7986104185, 643 F. Supp. 2d 577, 583-84 (S.D.N.Y. 2009); In re N.Y. Times Co., 585 F. Supp. 2d 83, 92 (D.D.C. 2008); Commonwealth v.Fenstermaker, 530 A.2d 414, 417-19 (Pa. 1987); see also In re Search Warrant for Secretarial Area Outside Office of Gunn, 855 F.2d 569, 575-76 (8th Cir. 1988) (Bowman, J., concurring).

As the Ninth Circuit explained, quoting, at length, from the Fourth Circuit,* when the government is still investigating, there is an interest in not disclosing warrant documents.

Once the investigation is over, that interest is gone, and the public's interest in knowing how it's government requires that the warrant documents be released to the public.

As the Ninth Circuit said, quoting the Eighth Circuit,

public access to documents filed in support of search warrants is important to the public's understanding of the function and operation of the judicial process and the criminal justice system and may operate as a curb on prosecutorial or judicial misconduct.

The court of appeals also ordered the government to pay Mr. Kortlander's costs in the appeal.

* !

September 29, 2011

Bribery in New Jersey. No, really.

Sometimes, the cooperating witness in a case seems a little shadier than the guy who got caught.

Herman Friedman owned an apartment building in West New York, New Jersey. He rented out 16 apartments. One day, a building inspector visited Mr. Friedman's property. He noticed that the building had only 15 legal units - not 16. The inspector issued a Notice of Violation.

To try to sort this out, Mr. Friedman went to meet with a Construction Code Official, Franco Zanardelli. Perhaps like many New Jersey zoning officials, Mr. Zanardelli was working for the FBI. He was trying to get a sentence reduction under 5K1.1 after he was caught taking bribes in a prior investigation.

Mr. Friedman told Mr. Zanardelli that the apartment had 16 legal units when he bought it and that he shouldn't be penalized. Mr. Friedman asked Zanardelli to issue a variance for his 16th unit.

Zanardelli took no official action in response. One can imagine that he shrugged.

Without a resolution from Zanardelli, Mr. Friedman went to Municipal Court. The court told him to try to work things out with Zanardelli because the penalty for having an illegal apartment is $500 a day.

Mr. Friedman called Zanardelli, desperate for help. Zanardelli asked him "What, what do you want to do? You just want to legalize the unit?"

Mr. Friedman indicated that this was exactly what he wanted to do.

They met at the building. Mr. Friedman pointed out that the 16th unit had obviously been there a while. Zanardelli said it wasn't in the tax records. He asked again what Mr. Friedman wanted to do.

Mr. Zanardelli told Mr. Friedman he could go for a variance. That wouldn't solve the $500 a day problem. They had this exchange,


Zanardelli:  [y]ou're gonna have to go for a variance. That's it. I mean, I mean what are you gonna do.

Friedman: "Well, you know what you could do, what you can do?

Zanardelli:  "So what are you suggesting here?

Friedman:  "You tell me . . . Whatever it is."

Zanardelli: "I can't tell you, you tell me."

If you couldn't guess, "whatever it is" was a bribe.

Using hand gestures, the two worked out a bribe of $5,000. Mr. Zanardelli lifted the complaint.

Months passed. Mr. Friedman didn't come through with the money. He avoided Mr. Zanardelli's calls. Mr. Zanardelli pressured him at the direction of the FBI, reissuing the complaint.

Mr. Friedman put the building up for sale. He found a buyer who would buy it only if the building had 16 units. Mr. Friedman, finally, paid $5,000 to Zanardelli. He didn't lift the complaint. The sale fell through.

Close to a year later, Mr. Friedman was indicted.

The Trial

At trial, Mr. Friedman tried to introduce evidence that the records in Mr. Zanardelli's office actually showed that the building had 16 legal apartments. According to a witness from the local zoning office, the best, most recent documents, showed that Mr. Friedman was allowed to have 16 units there.

The trial judge didn't let the evidence in, because it was "a whimsical argument that this is somehow related to entrapment."

Mr. Friedman was convicted.

The Sentencing

At sentencing, the government and Mr. Friedman disagreed about the loss amount from the bribery guidelines.

The bribery guidelines are particularly hard on people convicted of a crime. The loss amount that U.S.S.G. § 2C1.1 aren't based on the amount of the bribe, but, rather, based on "the benefit received or to be received in return for the payment."

So, the loss number shouldn't be $5,000 - the amount of the bribe - but, rather, the amount of money that the city of West New York lost out on.

The government figured that to be a very high number indeed, based on the accumulation of daily penalties. Mr. Friedman disagreed, and said that number was too inchoate.

The sentencing judge split the baby. He declined to find a loss number, or resolve what the right guidelines are. Instead, the sentencing judge said that thought a sentence of 34 months was about right.

A sentence of 34 months was imposed on Mr. Friedman.

The Appeal

The Third Circuit heard a number of challenges to Mr. Friedman's conviction. In United States v. Friedman, it rejected them all.

The court of appeals did, however, vacate his sentence and remand for resentencing. After the guidelines were made nonbinding in Booker, the Supreme Court, and then the courts of appeals, set out a procedure for sentencing in a federal case.

First, the district court has to calculate the guidelines. A district court cannot sentence a person in federal court without first determining the appropriate guidelines.

Since that didn't happen here - the sentencing judge cut to the chase of what it thought a fair sentence is - the court of appeals remanded to do it again.


September 28, 2011

Immigration Fraud and the Sentencing Guidelines Numbers Game

The federal sentencing guidelines love numbers.

Numbers, according to the guidelines, are how you know how bad something is. If the amount of loss from a fraud is higher, the fraud is worse. If there are more drugs, the drug distribution is worse. If there are more victims, or guns, or illicit images, or years of illegal peonage, the crime is always, under the guidelines, worse.

The guidelines like numbers for the same reason that lawyers like rankings - they force a crisp objectivity. Columbia is ranked higher than the University of Chicago - if you're choosing between the two, the decision just got easier.

People crave definite information in difficult decisions, whether they're law students deciding where to go to school or federal judges deciding how to punish a crime.

This focus on numbers may not capture all that we want about how bad a crime is. Maybe a woman who steals $7,000 to pay for insulin for her aging father is less bad than the man who steals $5,000 to buy mint condition Paul Anka LPs.

Maybe she's less bad in more than one way.

As troubling as whether numbers get it right, is how hard it is to get the numbers themselves right.

The Second Circuit,* in United States v. Archer, clarified how these numbers of bad things should be counted when the numbers translate into additional time in prison.

Mr. Archer's Troubles

Mr. Archer was an immigration attorney. He helped people fill out I-687 legalization applications. As it happened, several of the legalization applications he completed for people contained numerous material falsehoods.

The details of how I-687 legalization applications work is complex. I'm going to ignore them. If you're really into these, please read the opinion.

The bottom line is that Mr. Archer completed 171 I-687 applications. At sentencing, there was evidence that four of them contained false statements. If more than 100 contain material false statements, Mr. Archer's guidelines level increases. It's in U.S.S.G. § 2L2.1(b)(2)(C).

The government said that he should get the enhancement for having more than 100 false documents, because all four of the ones the government looked at were false. The sentencing court bit on that argument - the enhancement for more that 100 false documents was imposed.

"Ghost Dope" and Statistics

The Second Circuit was not so keen to use that analysis. As the court of appeals noted, it had previously held that

To sustain quantity-based enhancements for relevant conduct, the court must base its findings on "specific evidence" that the offense involved the requisite quantity of items. This evidence can, however, be circumstantial. United States v. Shonubi ("Shonubi II"), 103 F.3d 1085, 1090 (2d Cir. 1997). This requirement has two parts: (a) there must be evidence regarding the quantity of illicit or fraudulent goods and (b) it has to be specific to the defendant.

Shonubi was a heroin case.

(Quantity-based guidelines enhancements are the great equalizer of the federal sentencing guidelines - the same rule about how to count them applies to a guy who swallowed balloons of heroin to come through JFK as applies to Jeff Skilling or Conrad Black.)

In Shonubi, the person accused of the crime made eight trips to the United States from Nigeria to transport heroin. On the last trip, he was found with 427 grams of heroin. The district court multiplied 427 times eight and sentenced him as though he was caught with that quantity of heroin. In the Bureau of Prisons, I understand that this quantity is referred to as the "Ghost Dope."

The Second Circuit vacated the ghost dope sentence. On remand, the district court had an elaborate hearing, where it heard evidence about how heroin traffickers from Nigeria normally operate. It then imposed the same sentence as before appeal.

The Second Circuit, again, reversed. The court of appeals instructed that a sentencing court has to have some specific evidence relating to the actual person who is being sent to prison, not just folks who are like him or her.

It's an enlightened approach to ghost dope.

Statistics And Mr. Archer

The Second Circuit has noted that in the second Shonubi opinion

In so vacating, our court was careful to point out that "specific" evidence need not be "direct" and, when correctly considered, circumstantial evidence could be sufficient. Id. For example, the court approved of statistical extrapolation to arrive at an estimate of drug quantity when the sample was randomly selected from a known population. Id. at 1092 (approving of the method of testing four randomly selected heroin balloons to estimate the quantity of heroin contained in 103 balloons found inside the defendant's body).

So, if you have a sample that is random and comes from a known population, you can use it to extrapolate for guidelines purposes.

In Mr. Archer's case, the government argued that it had done exactly that. It looked at four of the 171 applications, and found that they all contained false statements. Since, as a matter of statistics, there's only a 10% chance that there would be fewer than 100 false documents from a sample of four (it's worked out in footnote 6 on page 19 of the opinion), that's good enough for government work.

The problem with this analysis, the court of appeals noted, is that these four applications were not randomly selected - rather, the government seems to have picked the very worst applications.

The Government's Other Argument

The government had an alternative argument,

The government notes that 100 percent of the applications involved aliens who claimed to have entered the country illegally, that 96 percent of these aliens allegedly did so in 1981, that 90 percent of the applications claimed travel outside the country between June and October 1987, and that 26 percent involved one or more fill-in-the-blank affidavits.

Based on these remarkable similarities, the government said that these applications simply had to be false.

The Second Circuit was unimpressed with this line of reasoning.

That information is interesting, but without a baseline as to what the national pool of I-687 applications (filed by, we must assume, honest lawyers) looked like to compare it to--and [the government expert] admitted he had no such baseline--the data tell us nothing about the truth or falsity of the applications. It is like saying that Dr. Jones's patients died, on average, a year after their initial visit with her: if most of her patients were healthy people coming for a check-up, this information suggests a finding that Dr. Jones is a terrible physician; if, on the other hand, Dr. Jones is an oncologist, all of whose patients had terminal cancer of a sort that had a national average life expectancy of two months, the same information makes her look very good indeed. Context is essential; but the government did not take the time and make the effort to provide any.

The Second Circuit vacated Mr. Archer's sentence and remanded.


* Two things about the Second Circuit that you may not care about. First, the court's RSS feed is annoying to work with - it doesn't automatically update in my Google Reader Feed for new published opinions for the Federal Circuit Courts (though, at least they aren't the 6th Circuit which doesn't even have an RSS feeder). Second, they issue their opinions in Goudy Old Style, a font I'm really enjoying, and which Matthew Butterick called "generally acceptable" in Typography for Lawyers.

September 28, 2011

The Increasing Number of Ways The Feds Can Prosecute You Troubles The Wall Street Journal

Those tree-huggers over at the Wall Street Journal have published a characteristically liberal piece about how the federal government is throwing more of its citizens in prison for no good reason.

As the article starts,

For centuries, a bedrock principle of criminal law has held that people must know they are doing something wrong before they can be found guilty. The concept is known as mens rea, Latin for a "guilty mind." This legal protection is now being eroded as the U.S. federal criminal code dramatically swells. In recent decades, Congress has repeatedly crafted laws that weaken or disregard the notion of criminal intent. Today not only are there thousands more criminal laws than before, but it is easier to fall afoul of them. As a result, what once might have been considered simply a mistake is now sometimes punishable by jail time.

The article lays the blame squarely on Congress in some pretty funny ways. It's worth a read.

This has me wondering if the problem of overcriminalization (and, yes, if the NACDL and the Heritage Foundation both think something is a problem, then odds are it is) stems from having legislatures, instead of judges, making criminal laws.

If you have a common-law model for when crime is caused, you're much less likely, I think, to have such weak politically-motivated and poorly-conceived crimes for people to run afoul of.

September 27, 2011

Conrad Black Writes About His Prosecution

Over at the Huffington Post, Conrad Black writes, from prison, about his experience with the United States criminal justice system. (Spoiler Alert - he doesn't like it).

Mr. Black was prosecuted for fraud by the United States government. He's on the last few months of a prison sentence. Here are some of his thoughts:

Before this cataract of horrors began, I had known that there were some dodgy aspects to the U.S. legal system, and feared that the plea bargain system was essentially a bazaar for the exchange of inculpatory perjury for reduced sentences or immunities, a traffic that would lead to the disbarment of prosecutors in most serious jurisdictions.

He also notes that the United States has too many people in prison, and that our nation doesn't recognize people's rights:
The United States has six to 12 times as many incarcerated people per capita as other comparable, prosperous and sophisticated democracies: Australia, Canada, France, Germany, Japan, and the United Kingdom. The Fifth, Sixth, and Eighth Amendment guaranties of due process, the grand jury as assurance against capricious prosecution, no seizure of property without fair compensation, access to counsel, an impartial jury, prompt justice, and reasonable bail, (I enjoyed none of these rights), have all been jettisoned while the Supreme Court has been drinking its own bathwater.

Moreover, he is skeptical of how prosecutors use their power and about the efficacy of public defenders:
Prosecutors routinely seize and freeze defendants' assets on the basis of false affidavits to prevent engagement of (avaricious) counsel of choice; there are many catch-all charges apart from the Honest Services statute that the Supreme Court rewrote in our case, that are impossible to defend, and prosecutors attack with unfeasible numbers of counts and have the last word before unsophisticated juries that have to rely on their memories of lengthy and complex proceedings and have been pulled from jury pools that have been softened up by an unanswerable prosecution lynching in the media. The public defenders are Judas Goats of the prosecutors rewarded for the number of victims they load on to the conveyor belt to the prison industry, not for the services they perform.

Finally, Mr. Black is leaving this country as soon as he's released, and he's not planning on returning.

Also, he's publishing a memoir.

September 27, 2011

Retroactivity In The Federal Sentencing Guidelines and The Parol Evidence Rule

One of the hardest things about representing a person charged with a crime in federal court is that the law is often changing. A decision that makes sense based on the law at the time, may not make sense later, if the law moves.

Fortunately, sometimes when the law changes, it changes for the better. And, sometimes when the law changes for the better, a person charged with a crime can benefit from it.

The Sixth Circuit provides a nice example of this in United States v. Cornell Smith.

Mr. Smith was charged with distributing more than a kilogram of crack cocaine. His lawyer negotiated a plea agreement for him under Federal Rule of Criminal Procedure 11(c)(1)(C).

Federal Rule of Criminal Procedure 11(c)(1)(C)

A plea under Rule 11(c)(1)(C) - commonly referred to as "C" plea by those who practice federal criminal law - binds the court at sentencing. Normally, a United States District Judge has complete discretion to impose a sentence up to the statutory maximum, or down to probation if there is no mandatory minimum.*

Under a C plea though, the parties agree either on a specific range or a specific sentence. The sentencing judge then has a choice - she can accept the agreed sentence or reject the plea entirely and the person can go to trial.

Some district court judges routinely reject C pleas because they feel that they encroach on their power too much. Some prosecutors routinely refuse to enter into them because they fear a reaction from the judge.

Mr. Smith's C Plea

Mr. Smith's C plea was to 15 years. Mr. Smith and the prosecutor attached to the plea agreement a sentencing worksheet that said that the guidelines range, as they calculated it, was 168 months to 210 months. Presumably, the guidelines worksheet was there to convince the sentencing court that the C plea should be accepted. In any event, it was a C plea to 15 years.

Trouble Brews

The presentence report, though, found that the guidelines range really should be 210 months to 262 months, because the United States Probation Officer who wrote the presentence report found that a guidelines enhancement applied that the parties thought should not have.**

In response to this calculation, Mr. Smith's attorney wrote to the Probation Officer that:

The Present Report as authored is a firm commitment to the mandatory guidelines. The guidelines are dead. United States v. Booker, 125 S. Ct. 738, 739 2005; United States v. Oliver, 397 F.3d 369 (6th Cir. 2005). [sic] declared the mandatory guidelines unconstitutional. The plea agreement entered into between the United States Attorneys Office [sic] and Defense Counsel was not based on the guidelines and therefore, there is no miscalculation by the attorneys. The plea agreement reached between the attorneys and their clients was based on the fact that a 15 year maximum sentence was sufficient and in the interests of justice. The Presentence Report failed to consider the validity and worthiness of the plea agreement entered into by the parties. The plea agreement was valid and in the interests of justice. Worshiping the dead mandatory guidelines gives honor to the deceased guidelines and gives them more weight and respect than the rulings of the United States Supreme Court and the Sixth Circuit Court of Appeals. The mandatory guidelines should be left in their crypt and not brought above ground level. (emphasis added)

It probably felt good to write.

The Court, in any event, accepted the C plea and sentenced Mr. Smith to 15 years in prison.

The Law Changes

After Mr. Smith was sentenced, the United States Sentencing Commission changed the sentencing guidelines for crack cocaine. The Sentencing Commission decided that the change in the crack guidelines is retroactive.

Normally, once someone is sentenced in a federal court, their case is over, and the sentence cannot be changed. There are a few narrow exceptions to this rule though.

One of them is if the guidelines have changed, and the sentencing commission makes the change retroactive. As 18 U.S.C. § 3582(c)(2) says, such a resentencing can happen

in the case of a defendant who has been sentenced to a term of imprisonment based on a sentencing range that has subsequently been lowered by the Sentencing Commission pursuant to 28 U.S.C. 994(o), upon motion of the defendant or the Director of the Bureau of Prisons, or on its own motion, the court may reduce the term of imprisonment, after considering the factors set forth in section 3553(a) to the extent that they are applicable, if such a reduction is consistent with applicable policy statements issued by the Sentencing Commission.

Though this only happens if the person was originally sentenced based on the sentencing guidelines.

So, for Mr. Smith, the question is whether he was sentenced based on the sentencing range under his C plea.

C pleas And Sentencing Ranges

The Supreme Court very recently held that a C plea does not prevent someone from getting the benefit of a retroactive change in the guidelines under 18 U.S.C. § 3582(c)(2) if the person's sentence was based on the guidelines in Freeman v. United States. So Mr. Smith is eligible for a new sentence if his C plea was based on the guidelines.

There is, though, the problem of his lawyer's statement to the Probation Officer, which expressly said that the sentence was not based on the guidelines, but, rather, on "the interests of justice."

As this case shows, in federal criminal practice, sometimes it's better not to talk about the interests of justice.

The Parol Evidence Rule

Happily, the Sixth Circuit held that when determining whether a C plea is based on the sentencing guidelines, you don't look at parol evidence.

Most criminal defense lawyers choose their practice area so they don't have to think about the parol evidence rule. They'd rather think about parole evidence (get it?).

The Parol Evidence Rule is the rule that when interpreting a contract, like a plea agreement, you don't look at evidence outside of what's in the document.

So, here, the court of appeals looked only at the plea agreement itself, and not at the defense lawyer's statement, and determined that Mr. Smith's plea was based on the sentencing guidelines.

As a result, the Sixth Circuit sent Mr. Smith's case back for resentencing under section 3582.

* This discretion is sometimes overly celebrated among those charged with a crime. Just because a judge can give probation for, say, health care fraud with more than $100 million in losses doesn't mean that the judge will. It's a bit like how I could sell you my car for $100. Sure, I've got the legal ability to do it, but I'm not going to.

** For those not in the know, before sentencing in every federal criminal case, a presentence report is written by a United States Probation Officer. The report contains a calculation of the now advisory sentencing guidelines, as well as a social history of the person being sentenced. And, yes, this is not what you normally think of Probation Officers doing.

September 27, 2011

New York Times Uncovers A Trial Penalty In Federal Cases. Also, the Sun Rises.

Yesterday, the New York Times reported that there is a trial penalty in criminal cases - that is, people accused of a crime spend more time in prison if they go to trial and lose than if they plead guilty.

The Times also reported that federal prosecutors have a lot of power.

September 23, 2011

Mortgage Fraud Is Not Money Laundering, Or, Why Not To Buy A House With A Drug Dealer

It's money laundering week here at the Federal Criminal Appeals Blog. Yesterday, I wrote about Walter Blair, the lawyer who was convicted for performing extra-legal services.

Today, the Third Circuit issued a happier decision (though not for the government) in United States v. Richardson.

The Dream of Home Ownership

Asya Richardson was the fiancé of Alton Coles, a known drug dealer in Philadelphia. Mr. Coles was also something of a renaissance man, promoting a series of nightclub events and running a record label, Take Down Records. The nightclub generated revenue and broke even. Take Down Records was not financially successful.

Ms. Richardson and Mr. Coles wanted to realize the American dream of home ownership. This presented a problem. Ms. Richardson only made $22,800 a year as a customer service representative at Bank of America. Mr. Coles asserted that he made $100,000 a year as the CEO of Take Down Records. Unfortunately, Mr. Coles, like many entrepreneurs, had bad credit.

The solution? Mortgage fraud. The couple decided to put the house in Ms. Richardson's name, and they said in their paperwork that she made more than $110,000 per year.

This allowed the couple to purchase the house together, but place it in Ms. Richardson's name.

Closing Costs

They still needed money for the down payment though. Here's how the court of appeals describes how they funded part of the money they brought to settlement.

The day of settlement was marked by a flurry of banking activity. At 12:08 p.m., a $9,800 cash deposit was made into Coles' and Richardson's joint checking account at PNC Bank. This deposit took place at a PNC branch located in Philadelphia. At 1:12 p.m., Coles made a $9,140 cash deposit into Take Down Records' business account. The funds were later transferred to Coles' personal checking account and used towards the down payment. Half an hour later, at the same bank branch, Coles deposited $9,200 in cash directly into his personal checking account. At 3:33 p.m., Richardson made a $9,200 cash deposit into the couple's joint checking account. This deposit was made at a PNC branch located in Stratford, New Jersey, which was near the location of the settlement. Finally, at 4:00 p.m., Coles made a $6,160 cash deposit into a Wachovia checking account belonging to his son. This deposit, too, occurred at a branch located in Stratford.

The settlement went smoothly and the couple became happy homeowners.

Trouble Brews


shortly after the couple had moved into the new home, a federal grand jury returned an indictment charging Coles with a single count of possession of a firearm by a convicted felon. Three superseding indictments followed charging Coles and others with various drug trafficking and firearms crimes. On March 22, 2006, a fourth superseding indictment was filed charging Coles and Richardson with money laundering, 18 U.S.C. § 1956(a)(1)(B)(i), conspiracy to commit money laundering, 18 U.S.C. § 1956(h), and wire fraud, 18 U.S.C. § 1343.

The couple went to trial, along with others. Mr. Coles was convicted of the drug distribution charges, as well as the money laundering. Ms. Richardson was convicted of money laundering. Both were acquitted of wire fraud.

Ms. Richardson was sentenced to twenty-four months in prison.

The Appeal

On appeal, Ms. Richardson argued that there was not enough evidence to support her conviction for money laundering.

As the Third Circuit explained, to find someone guilty of money laundering, the government has to prove:

  1. an actual or attempted financial transaction;

  2. involving the proceeds of a specified unlawful activity;

  3. knowledge that the transaction involves the proceeds of some unlawful activity; and

  4. knowledge that the transaction was designed in whole or in part to conceal the nature, location, source, ownership, or control of the proceeds of a specified unlawful activity.(internal textual modifications omitted)

Ms. Richardson argued that there was not enough evidence that she knew that the transaction was being used to launder drug money to convict.*

The government countered that the intricate set of deposits on the day of settlement strongly indicated that something was afoot. All the deposits were under $10,000, giving a strong argument that they were made to defeat the reporting requirement that is triggered by a $10,000 deposit.

This, by the way, is itself a crime, prohibited by 31 U.S.C. § 5324, and known as smurfing.**

However, as the court noted, there was precious little showing that Ms. Richardson herself was aware of the pattern of deposits.

The government argued that not having Mr. Coles name on the loan was suspicious. And, the government pointed out, that Ms. Coles lied about her income to get the loan - surely that's suspicious.

In a passage sure to warm the hearts of mortgage brokers everywhere, the court noted,

These circumstances show that Richardson lied about her income and had the property titled in her name, not to hide Coles' involvement (which by then was perfectly obvious), but to get around Coles' bad credit and purchase the house as planned. No jury could have reasonably reached a different conclusion.

(internal citation omitted)

This wasn't money laundering - it was mortgage fraud. With a little more than a year left on her sentence, Ms. Coles conviction was vacated.


* She also argued, based on United States v. Santos, that the money laundering statute only applies to profits from drug dealing, not gross receipts, and that the money here involved gross receipts. The court of appeals rejected that argument.

** And, yes, that's my second Smurf reference in a money laundering post this week. Here's an odd article on how "smurf" is used that doesn't include this NSFW varation.

September 22, 2011

Money Laundering, Obstruction of Justice, And A Full-Service Lawyer

Walter Blair was a full-service lawyer. He received a phone call from a woman who wanted to hire a criminal defense lawyer. The woman's name was Ms. Nicely. Ms. Nicely had a relatively intricate problem.

The Safe Full of Money

As it happened, she was in possession of a safe that contained a substantial amount of money that belonged to Mr. Rankine. Mr. Rankine was a drug-dealer. The money was drug money. Mr. Rankine's girlfriend had been found murdered, and Mr. Rankine was missing.

Ms. Nicely had been receiving threats about the money in the safe and became frightened. Through a referral from a co-worker, Mr. Henry, she contacted Mr. Blair.

They met. Mr. Blair told her to open the safe "by any means necessary" and bring the money to him. She did.



Mr. Blair and Mr. Henry counted the money - there was approximately $170,000. Mr. Blair made up a cover story about a joint investment headed by Mr. Rankine's girlfriend. Since she was no longer living, she couldn't repudiate the story.

Mr. Blair then had his law partner create a corporation to take the money so that Ms. Nicely and Mr. Henry could invest in real estate. This was in 2003 when investing in real estate seemed less like investing in Smurf collectibles.

Mr. Blair also told Mr. Henry and Ms. Nicely that they would need to set aside money to cover the legal fees for two of Mr. Rankine's colleagues who had been arrested and were charged in the U.S. District Court in Richmond Virginia.

The Federal Case In Virginia

Mr. Blair reached out to two Virginia lawyers to represent Mr. Rankine's colleagues. Mr. Blair also retained himself to represent the men. Eventually, he filed a pro hac vice motion in the federal case in Virginia.

(A pro hac vice motion is a motion that lets an attorney practice law in a court that she is not otherwise admitted to practice in for one time only, provided certain conditions are met).

As a part of the pro hac vice motion, Mr. Blair told the court that he had never been disciplined by any bar association. As it happened, that was not entirely accurate - Mr. Blair had previously had his law license suspended in West Virginia for witness tampering.

Things Break Bad

Mr. Blair gave Ms. Nicely a set of things to memorize about how all of these transactions were supposed to have gone down. Sadly, when interviewed by the FBI, Ms. Nicely was not 100% in line with Mr. Blair's instructions. Oh what a tangled web we weave.

Mr. Blair was indicted for money laundering, in violation of 18 U.S.C. § 1956 and § 1957 for his handling of the funds brought into his office. He was charged with obstruction of justice for his false statement in his pro hac vice motion under 18 U.S.C. § 1503. He was also charged with failing to file a tax return.

On appeal, he had two main challenges. The Fourth Circuit gave Mr. Blair a split decision in United States v. Blair.

The Money Laundering Safe Harbor Issue

First, the money laundering statute has a safe harbor provision for criminal defense attorneys who are receiving money from someone to mount a defense. Mr. Blair contended that this safe harbor provision sheltered him from one of the money laundering charges against him.

There's been a lot of attention to this issue lately, particularly since the Eleventh Circuit rejected a government money laundering prosecution in United States v. Velez. The basic rule of the safe harbor provision is that if a person has money that was derived from illegal conduct, and uses that money to pay for a defense attorney, that transfer cannot be the basis of a money laundering conviction. Section 1957(f)(1) recognizes that the Sixth Amendment protection of the right to counsel is more important than criminalizing this behavior.

Here, though, the Fourth Circuit rejected the safe harbor provision's application to Mr. Blair. As Judge Wilkinson said,

Blair used someone else's criminally derived proceeds to bankroll counsel for others.

This, the majority found, exceeds the scope of the safe harbor provision. Though Judge Traxler wrote a forceful dissent arguing that the safe harbor provision should apply.

Obstruction of Justice Challenge

Mr. Blair fared much better on his challenge to the obstruction of justice conviction. The government argued that lying on a pro hac vice motion is obstruction of justice. To do that, the prosecutors had to successfully "establish a nexus between the false statement and the obstruction of the administration of justice." That is, the government had to show that Mr. Blair's false statement "had a natural and probable effect of impeding justice."

The Fourth Circuit found no evidence that Mr. Blair lying about his West Virginia disciplinary troubles caused any problems, or was likely to cause any problems, with anything. Mr. Blair's representation was already a massive conflict of interest - his lie was just icing.

The court of appeals concluded that the government's allegations rested on "mere speculation."

The appellate court, then, vacated Mr. Blair's conviction for obstruction of justice, and remanded for resentencing without that count of conviction.

September 22, 2011

My Guest Post on the ACS Blog on the War on Drugs

Over at the American Constitution Society's blog, I have a guest post on how President Obama has handled the war on drugs.

By way of a teaser, Reason Magazine has an article called "Bummer" which is very critical of President Obama. The post is my take on how Obama has fared - I think he's not a full-on bummer, but he's also not the President I thought he'd be when he was running.


September 21, 2011

Important White-Collar Crime Decision By the Federal District Court in D.C.

Judge Huvelle on the U.S. District Court for the District of Columbia issued an opinion in United States v. Ring that is tremendously important for white-collar practitioners specifically, or people who are interested in sentencing in federal criminal cases more generally. It dodges, in a very nice way, the question of how much of a penalty the government can try to assess on a person accused of a federal crime who decides to go to trial.

The Washington Post has a story, as does Sentencing Law & Policy.

Mr. Ring was accused of being involved in Jack Abramoff’s illegal deeds. Unlike everyone else in the case – indeed, unlike most white-collar defendants – Mr. Ring went to trial. He was convicted.

The government asked the court to impose massively higher sentencing guidelines adjustments than it requested for others who had entered a guilty plea and cooperated with the government. As Judge Huvelle noted,

 As Ring points out, the government now advocates for a Guidelines methodology that it has never asked for before (and that the Court has not previously employed) with respect to calculating the sentences of his co-conspirators.

The increased guidelines were significant.* Mr. Ring argued that they were the result of the government wanting to punish him for making them go to trial.
Defendant’s position is that the government is retaliating against him for exercising his Sixth Amendment right to trial. It is easy to see why such an inference might be justified, since the government’s new methodology for calculating defendant’s offense level (prior to adjustments for role in the offense and obstruction of justice) would result in a Guidelines sentence of between 121 and 151 months—nearly nine years longer than it would otherwise have been. . . . Indeed, the government’s position is that Ring’s total offense level (37) should be the highest of all participants in the conspiracy, despite the fact that Abramoff (whose offense level was 34, not including acceptance of responsibility) and Scanlon (whose offense level was 27, not including acceptance of responsibility) were clearly more culpable.

Mr. Ring asked the court to apply the guidelines that were used for the others in the case, instead of using the higher guidelines the government asked for.

Judge Huvelle was sympathetic,

The notion that an ostensibly objective system of sentencing guidelines can produce such wildly varying results for essentially the same offense conduct is deeply troubling, and indeed, as Ring argues, if the Guidelines are “subject to manipulation” in this fashion, it would mock the very consistency the Guidelines were meant to impose on such elementary concepts as “offense level.”

Judge Huvelle did not find that the government was imposing a trial penalty, though. Instead, she adopted the guidelines applicable to the others through a straightforward guidelines analysis, ultimately concluding that Mr. Ring’s guidelines were in line with the others in the case.

* For the folks who are into the details of the guidelines issues, to summarize so you can see if you want to read the opinion, the main issues are: (1) the application of a bribery cross-reference under § 2C1.7 that would apply the bribery sentencing guidelines under § 2C1.1 instead of the § 2C1.7 Honest Services Fraud guidelines; (2) the “more than one bribe” enhancement under § 2C1.1; (3) loss calculation under § 2C1.1(b)(2); (4) a manager enhancement under § 3B1.1; (5) an obstruction of justice enhancement under §3C1.1; and (6) whether Ring can get acceptance under § 3E1.1 even though he went to trial.

All issues were resolved under the 2003 version of the guidelines, for ex post facto reasons. (and, though I normally like to link to the guidelines sections themselves, I didn't here, because they are only available in pdf).

September 20, 2011

The "Snowstorm" That Wasn't There, or, Why DNA Doesn't Get Collected From Every Misdemeanant On Probation

Mark Twain may have said that the coldest winter he ever spent was a summer in California. Or maybe not. Regardless, the quote suggests itself as the inspiration behind the United States Attorney's Office for the Northern District of California's charging decision in United States v. Baker.

Robert Baker was a passenger in car in a high-speed chase in Northern California. The chase was "speedy" in two senses - in addition to driving fast, there was methamphetamine in the car.

The chase ended badly for the chasee - the police caught up to the car and charged Mr. Baker with conspiracy to possess with intent to distribute methamphetamine.

In the car, the police found only 10 grams of meth. The government charged Mr. Baker, though, with much more, based on the testimony of two police officers who said that Mr. Baker was throwing bags of white powder at their car, which would explode on the windshield and create a "snowstorm" effect for a few seconds.

The government asserted that the white powder was meth, and that the "snowstorm" was caused by a much larger quantity of meth, more than 50 grams, and that Mr. Baker should be punished for having that larger amount of the drug.

Mr. Baker called another officer in his defense, who said he was a part of the chase and saw no "snowstorm." He also produced radio runs from the police that were free of any winter weather reports.

The jury went with Mr. Baker, acquitting him of the felony conspiracy charge and, instead, convicting him of a misdemeanor based on the drugs in the car.

At his sentencing for the misdemeanor, he was placed on probation for three years.

The sentencing judge, as a condition of probation, ordered that Mr. Baker be required to provide DNA to the Attorney General.

Mr. Baker appealed this condition of probation, and asked the Ninth Circuit Court of Appeals to order the destruction of all the DNA he had provided.

A sentencing court can only order that DNA be collected if it has the authority from Congress to enter such an order. The statute is 42 U.S.C. § 14135a.

As it happens, the statute provides no ability for a district court to order DNA collected from someone who is on probation, and, therefore not in custody, and who was only convicted of a misdemeanor.

So, if Mr. Baker had been convicted of a felony, the government could take his DNA for the national DNA database. If he was in jail, even for a little bit, the government could take his DNA for the national DNA database. But with a misdemeanor conviction and probation, Mr. Baker's DNA gets to stay with him.*

The Ninth Circuit reversed, remanded, and ordered all the DNA already collected destroyed.

* Did you know DNA evidence can be faked? Check out this article in the New York Times.

September 19, 2011

Judge Posner on Narcotics Wholesalers and Drug Quantity

I'm a big fan of Judge Richard Posner. As I've mentioned here before, Judge Posner is very bright - and has almost single-handedly revolutionized the role that economics plays in thinking about the law.

I was, therefore, happy to see that Judge Posner authored an opinion for the Seventh Circuit dealing with the relationship between heroin wholesalers and heroin retainers in United States v. Alvarado-Tizoc.

Alvarado-Tizoc dealt with two men who sold wholesale quantities of heroin and fentanyl. As Judge Posner explains,

Fentanyl is a very potent synthetic narcotic, used lawfully as a painkiller and unlawfully as a substitute for heroin. Because of its potency it must be greatly diluted before being consumed; otherwise it will kill. Deaths from overdoses of fentanyl by heroin addicts soared in 2006. Addicts' demand for fentanyl apparently had been augmented by a shortage of high- quality heroin, but it has fallen since 2006, probably because the deaths caused by overdosing on fentanyl induced more intensive efforts by law enforcers to disrupt the supply of the drug.

(Internal citations omitted. In this passage from the opinion, there were so many internal citations it almost drove me to Bryan Garner's position that citations should be in footnotes)

As wholesalers, the men who were sentenced in this case sold the drug to retailers, knowing that it would be diluted - this caused an odd sentencing result. As the court of appeals explained,
The defendants were wholesalers of heroin and fentanyl for illicit use. Their customers, the retail dealers, diluted the fentanyl (which already had been diluted to some extent) that they bought from the defendants in order to make it safer to consume. The dilution produced mixtures that contained less than 1 percent fentanyl, and the retailers sold these mixtures (doses) to their customers. The quantity (as measured by weight) of the greatly diluted fentanyl sold by the retailers was 11 to 16 times the quantity of fentanyl that the defendants had sold them. For sentencing purposes the weight of an illegal drug includes the weight of a mixture containing a controlled substance. U.S.S.G. § 2D1.1(c) n. A and Application Note 1; United States v. Sowemimo, 335 F.3d 567, 574 (7th Cir. 2003); cf. 21 U.S.C. § 841(b). Hence for sentencing purposes the retailers were selling much more fentanyl than their suppliers, who are the defendants in this case.

The sentencing court found that the men who were appealing were in league with the retailers. Because they were necessarily relying on the retailers to sell the fentanyl, the district court reasoned, they were all jointly liable for the retailers quantity of drug distribution. They were all, in the language of the guidelines, engaged in a jointly undertaken criminal activity - akin to being coconspirators, even though that wasn't the charge against them.

Judge Posner thought this would be an odd kind of conspiracy, noting that,

the fact that the buyers diluted the fentanyl they received (and that this was foreseeable to the defendants) no more proved a conspiracy than the fact that a seller of chocolate syrup to a soda fountain knows that the syrup will be mixed with milk or soda to make chocolate milk shakes or chocolate sodas rather than being sold in its original, undiluted form makes the seller a conspirator in the retail sale of adulterated chocolate drinks.

Because a buyer and seller are not, necessarily, in a conspiracy under Seventh Circuit law, the court of appeals rejected the argument that the wholesalers in this case were conspirators with the retailers.

Because there was no jointly undertaken criminal activity, the men who were appealing their case were sentenced using the wrong guidelines range - it should have been calculated using only their drug quantities instead of those of the retailers. Their sentences were reversed and sent back to the district court.

There are two things about this that are striking to me.

First, it is crazy to use the weight of a mixture or substance containing a drug for sentencing purposes, instead of using the amount of the drug itself. Judge Posner, and, apparently, the Seventh Circuit, agrees:

Emphasis on the weight of a defendant's drugs (in this case the weight of the dilute drugs sold by customers of defendants), whether or not they are diluted, has the perverse effect of giving drug dealers an incentive to possess and sell drugs of high purity or potency and makes the length of sentences depend perversely on the weight of the inactive ingredients in the drugs.

Second, this case hangs on Judge Posner's willingness to find that wholesalers and retailers are not engaged in a joint activity. The only way he gets there is by looking at an analogy to the business world, where thinking of a run of the mill soda distributor being in cahoots with a manager of a gas station that has a soda fountain would be unthinkable.

But, if a judge without that economics background looked at this case, the result could have been much different. Many people, and many judges, think of drug dealers as an undifferentiated mass of lawless people. If you don't see differences between different kinds of roles in the web of drug distribution, you can see how it would be easier to lump drug wholesalers and drug retailers into the same kind of conspiracy, without really thinking about their unique roles.

Perhaps this is a perverse argument for much more prosecution of commercial crimes.

September 16, 2011

The Federal Government Asks The Ninth Circuit To Hear The Obama Threats Case En Banc

Earlier, during the summer, I blogged about a Ninth Circuit opinion that vacated a conviction for making racially-motivated threats against President Obama.

As I noted at the end of that post, I am really looking forward to seeing how this gets resolved en banc.

And, apparently, I am now closer to getting to see that. The government has filed a petition for the Ninth Circuit to rehear the case. Politico's Josh Gerstein has detailed coverage and a link to the government's filing.

September 16, 2011

The Ninth Circuit Rejects A Car Search In Mr. Rodger's Neighborhood

In many ways, riding in a car is so much worse for you than, say, walking or riding a bike. When I drive, I know I'm not exercising; I can almost feel my muscles convert to fat. Driving burns gasoline, which is bad for the environment. Cars clog roads.

Other than the massive convenience and the ability to privately listen to bad radio, cars don't have much to recommend them.

Cars are even worse when you realize that driving a car also diminishes your Fourth Amendment rights. If the police have probable cause to think you have some contraband, they normally need a warrant to go in your house. Not so for your car. Because cars can move, the courts don't require a warrant to search a vehicle - mere probable cause is enough.

If you're arrested on the street, the police can search, "incident to arrest," anything you could reasonably be thought to reach while you're being subdued and arrested. If you're arrested in a car, the police can search, incident to your arrest, anything inside the car.

Perhaps this is one reason so few drug dealers on The Wire drive minivans. Or perhaps the lack of minivans on The Wire has more to do with this video.

In any event, given the law on the Fourth Amendment and vehicle searches, United States v. Rodgers, from the Ninth Circuit, is a breath of fresh air.

Mr. Rodgers was pulled over at 3:30 in the morning on the mean streets of Lakewood, Washington. His registration information showed that his car was one color - his car was, in fact, another. He was in a neighborhood known for crime, specifically juvenile prostitution.

The police officer who pulled him over approached the car. He recognized Mr. Rodgers as someone he'd pulled over before. Many times.

The officer also saw a girl who he estimated was about fifteen years old. He asked Mr. Rodgers why he was driving the girl at 3:30 in the morning. Mr. Rodgers said that he was taking her to an apartment building as a favor.

The officer suspected that Mr. Rodger's transportation involved a different kind of favor. He asked the girl for identification. She didn't have any. He asked her name, she gave him one.

The officer ran the name and found that there was an arrest warrant out for the girl. He pulled Mr. Rodgers and the girl out of the car, separately, for questioning. He asked the girl again for identification. She had no purse, and no identification in her pockets.

The officer then decided to search the car, near where the girl was sitting, for her identification.

He searched her seat and the center console. He found crystal meth.

He arrested Mr. Rodgers, then searched the entire car. He found a handgun and other drugs. Mr. Rodgers was charged in federal court with federal gun and drug charges.

He challenged the search of his car, but the district court denied his motion.

He was convicted at a bench trial, and determined to be an armed career criminal under 18 U.S.C. § 924(e)(1).

The Ninth Circuit reversed, finding that the search violated Mr. Rodger's rights.

The court of appeals rejected the government's position that the officer could search Mr. Rodger's car for the girl's identification, saying,

[The officer] did not identify any particular facts or observations that led him to believe [the girl] had identification and that it was inside Rodgers' car. Nor can we find any such facts in the record. There is, for example, no indication that [the officer] saw [the girl] trying to hide anything in the car, that [she] was eyeing anything inside the car, that [she] made any furtive movements, or that any papers or objects appearing to be identification were in plain view. Indeed, the only relevant fact [the officer] offered--that he never saw a purse or bag that might have contained [the girl's] identification--cuts against a finding of probable cause to search the car.

Because there was no probable cause, or other lawful reason, to search the car for the girl's identification, the evidence found had to be suppressed. Everything found after that was fruit of the same illegal search.

September 15, 2011

A Clever Defendant In The Ninth Circuit Wins, Then Loses, Arguing Double Jeopardy

People love a criminal defendant who tries to outwit the system. I suspect it says something profound about the American impulse to root for the underdog.* I've written before (here and here) about federal criminal defendants in the Ninth Circuit who have been rewarded by being clever about their cases.**

And, in United States v. Alvarez-Moreno, defense counsel cleverly navigated his client to an appellate issue.

Mr. Alvarez-Moreno was charged with transporting an alien for profit under 8 U.S.C. S 1324.

Two weeks before he was to start a jury trial, Mr. Alvarez-Moreno and the government agreed that the trial could be a bench trial. The court also agreed. (One odd feature of the federal system is that you can only have a bench trial on a felony if the government, the person who would be on trial, and court all agree under Federal Rule of Criminal Procedure 23.).

Everyone came to this conclusion right before trial. In the last minute push to get rid of a jury and go to the bench trial, no one noticed that Mr. Alvarez-Moreno never waived a jury trial in writing as required by Rule 23.

Mr. Alvarez-Moreno was convicted at the bench trial.

After he was convicted, he filed a "Motion to Set Aside Verdict By Trial Court" because Mr. Alvarez-Moreno did not properly waive his right to a jury trial. There's no question but that Mr. Alvarez-Moreno's conviction would be reversed on appeal if allowed to stand.

The district court treated that motion as a motion for a new trial, which it granted. The court set a new trial date.

Here's where things get interesting.

Mr. Alvarez-Moreno filed a motion to vacate the order for a new trial and dismiss the indictment because double jeopardy had attached. The trial court denied the motion.

Mr. Alvarez-Moreno appealed. (Normally, you can't appeal a criminal case until after sentencing. One of the narrow exceptions is for a violation of double jeopardy - the idea is that the harm in a double jeopardy violation is the second trial, so the appellate court will hear the decision before that harm can take place.)

The Ninth Circuit found that a new trial would violate double jeopardy. Jeopardy attached in the first trial when the judge started hearing evidence. Once jeopardy attaches, a person accused of a crime can only be retried - consistent with double jeopardy - in certain narrow circumstances.

One of those circumstances is if the defendant himself asks for a new trial. The district court construed Mr. Alvarez-Moreno's motion to set aside the verdict as a motion for a new trial. The Ninth Circuit said, basically, no. For that reason, a new trial would violate double jeopardy and the Ninth Circuit vacated the court's order granting one.

The appeals court, however, went a little further, denying Mr. Alvarez-Moreno's win much pleasure. The court of appeals directed the district court, on remand, to deny Mr. Alvarez-Moreno's original motion to set aside the court's verdict.

The Ninth Circuit then laid out Mr. Alvarez-Moreno's options:

If Alvarez-Moreno wants to correct the legal error, he can make a proper motion under Rule 33 for a new trial, or he can appeal the final judgment after he is sentenced; in either event, under the principles discussed earlier, he would have consented to retrial. Alternatively, Alvarez- Moreno may view those two routes as merely prolonging the inevitable, and so may decide that he does not want to undergo the stress of another trial. If so, he is, of course, entirely free to forego any Rule 33 motion or appeal and accept the sentence meted out on the basis of the conviction after it is reinstated upon remand. That sentence would not be void, but voidable, and if the sentence is complied with he could not be punished again for the same offense.

Perhaps cleverness has its limits.


* Though, as Adam Levin rightly reminds us in The Instructions, "anyone can tell his own underdog story. Be wary of underdogs."

** Why does this stuff only happen in the Ninth Circuit? You almost never see a clever defendant appeal come out in a defense-friendly way in, say, the Fourth Circuit.

September 14, 2011

Sex Offenders, Supervised Release, and The Eighth Circuit

As I think I've mentioned here before, Congress really does not like sex offenders. As it happens, neither do a number of federal district court judges.

The Eighth Circuit Court of Appeals recently made it a little harder for sentencing judges to act out of unthinking distaste for sex offenders in United States v. Springston.

A little background on Mr. Springston

Mr. Springston was required to register as a sex offender based on a 1986 conviction for sexual assault. Apparently, the sexual assault did not involve a child.

Mr. Springston had not registered as a sex offender. He was indicted for failing to register as a sex offender under 18 U.S.C. S 2250.

He was convicted and sentenced to three years in prison. The sentencing court also imposed ten years of supervised release on the end of his sentence.

A little background on supervised release

Supervised release, for those not familiar with the federal system, is a lot like what you think of as parole, only significantly less pleasant. A person on supervised release has not gotten out of prison earlier than the end of his sentence, and, if he violates his supervision, is not limited in the amount of additional prison time that he can receive by the remaining term of supervision.

When a person is given a sentence that includes supervised release, the sentencing court also sets conditions of supervision - things the person has to do, or he can be violated. If the person is violated, he can be sent back to prison.

Mr. Springston's supervised release conditions

The sentencing judge imposed three conditions of supervised release that were challenged in his appeal:

  1. He could not have unsupervised contact with a minor

  2. He could not have internet access at his house, or access the internet without the probation officer's supervision

  3. He had to have mental health treatment.

The sentencing court didn't spend a lot of time talking about these conditions. From the opinion, it looks like he just took the internet away from Mr. Springston without much thought (which, when you think about things like this, may not be so bad).

The Eighth Circuit vacated these conditions.

What a district court judge has to do when imposing conditions of supervised release, even for a sex offender

First, the law. Eighteen U.S.C. section 3583(d) requires

that a special condition must be reasonably related to the nature and circumstances of the offense of conviction, the defendant's history and characteristics, the deterrence of criminal conduct, the protection of the public from further crimes of the defendant, and the defendant's educational, vocational, medical, or other correctional needs.

More importantly, a district court judge can't just make stuff up for special conditions, even for sex offenders. Rather,

In fashioning a special condition of supervised release, a court must make an individualized inquiry into the facts and circumstances underlying a case and make sufficient findings on the record so as to ensure that the special condition satisfies the statutory requirements.

The Eighth Circuit finds that that the district court can't just rely on views about sex offenders as a class of people to impose conditions of supervised release

The Eighth Circuit vacated all three challenged conditions.

As to the condition that Mr. Springston not have the internet in his house, the court of appeals observed,

The record . . . is devoid of evidence that Springston has ever used a computer for any purpose.

About the condition that Mr. Springston never be near a child unsupervised - despite that his offense did not involve a child - or that he needed mental health treatment, the district court only explained that

"Mr. Springston's history as a sex offender justifies all of those conditions."

The Eighth Circuit disagreed, and vacated these conditions of supervised release.

A condition of supervised release has to be based on an individualized inquiry about the person being sentenced. Mr. Springston's conditions weren't.

September 13, 2011

The Seventh Circuit Reminds Us That Loss Is Not Equal To Restitition (also, pleading open has benefits).

Tomas Leiskunas, a man who "at 26 years old . . . had a minor criminal history and at least two aliases," was charged with being a straw purchaser in a mortgage fraud scheme in the federal district court in Chicago.

The folks who were engaged in the scam, according to the Seventh Circuit's opinion in United States v. Leiskunas, would take out fake mortgages in Mr. Leiskunas's name* on houses that he was never going to live in. He would attend real estate closings and say that he was going to live in the houses.

That's against the law.

Mr. Leiskunas decided to plead guilty. He declined to accept a plea agreement from the government, deciding, instead, that he would like to plead open. (For prior posts on defendants who have done well on appeals by pleading open, check out this post, this post, or this post).

The biggest effect of an open guilty plea is that there are no agreements about the person's sentencing guidelines. In a fraud case, as in almost any white-collar case, loss amount is the largest question on the table. In Mr. Leiskunas's case, it was also responsible for his win in the Seventh Circuit.**

The starting point for most white-collar sentencing guidelines is section 2B1.1 of the federal sentencing guidelines. The biggest factor driving a white-collar case is normally loss amount.

The guidelines say that the loss amount is the amount of money that is reasonably foreseeable to be lost to the person charged with the crime.

In Mr. Leiskunas's case, the government had a novel and concrete theory of loss.

The total amount loaned in the closings that Mr. Leiskunas participated in was $4,473,161.55.

Because, as you may have noticed, the housing market is not doing well, each house involved in Mr. Leiskunas's case was foreclosed on (that they were a part of a mortgage fraud conspiracy may have been a contributing factor). The total value of money raised at these foreclosure sales was $1,792,000 less than the total amount loaned.

Thus, the government argued, the amount the banks lost must have been the amount that was reasonably foreseeable to Mr. Leiskunas.

The district court adopted the government's calculation of loss without much discussion.

The Seventh Circuit reversed because the district court did not offer an explanation for accepting the government's position.

The appeals court did not opine on the merits of the government's position. It did not note, for example, that there was no way Mr. Leiskunas could have known what the houses would fetch later at a foreclosure sale. The court of appeals did not explain that the amount used as a loss number was the amount of harm actually suffered, which is very different than the amount of harm that Mr. Leiskunas would have been able to predict when he participated in the mortgage fraud. The Seventh Circuit also did not point out that the government's test completely fails to account for the way the guidelines explicitly say that loss amount should be calculated.

Nope, the Seventh Circuit just sent it back for a better explanation.


* Or, if not his actual name, one he would be willing to answer to during a real estate closing.

** Sort of. The Seventh Circuit also reversed on the district court's determination that Mr. Leiskunas did not play a minor role in the mortgage fraud scheme. The district court expressed the belief that the law was that Mr. Leiskunas could not be a minor player if he was essential to the scheme or was involved, in a minor way, a number of times. This was not the law, according to the Seventh Circuit. For more, see USSC S 3B1.2.

September 12, 2011

Dismiss a Case Because of a Speedy Trial Act Violation? Not so fast.

The Speedy Trial Act is an odd thing. Normally, a person charged with a federal crime - be it a white-collar crime or a drug distribution charge - has spent less time looking at the government's evidence than the government. Often, a defendant is going to want more time to prepare for trial than the 70 days provided by the Speedy Trial Act, at 18 U.S.C. 3161. (Though not always, Senator Ted Stevens didn't seek more time and that worked out well for him.)

That said, normally the government wants more time too. And, for that matter, the trial court often wants more time. That's likely less the case in, say, the Eastern District of Virginia, but in a number of federal courts around the country - especially as the pace of judicial confirmations slows - the trial judge is hoping that a trial isn't going to happen 70 days into the case as much as anyone.

As a result, in many cases there winds up being a conspiracy between the government, the court, and, sometimes, the defendant to defeat the Speedy Trial Act.

The Act excludes any time that a motion is pending during the 70 day time. So, normally, the defendant files a motion to suppress evidence, or, quixotically, to dismiss the indictment, and that stops the Speedy Trial Clock.

This gets tricky, however, because if the Speedy Trial Act is not complied with, the Act requires that the indictment gets dismissed - though more on that later. So a defendant both wants to stop the clock, and benefit from the clock not being stopped.

In the Eight Circuit's recent opinion in Bloate v. United States, the court of appeals addressed an interesting Speedy Trial Act issue.

Mr. Bloate was convicted and sentenced to 30 years in prison. He filed a motion to dismiss the indictment under the Speedy Trial Act. It was denied. He appealed, complaining about the Speedy Trial Act. His appeal lost. He went to the United States Supreme Court. The Supreme Court held that the Eighth Circuit should not have denied his Speedy Trial Act claim for the reason it did. The Court remanded for the Eighth Circuit to take a mulligan on the Speedy Trial Question.

Here's the timeline for Speedy Trial Analysis - Mr. Bloate was indicted on August 24. His motions were due on September 13. On September 7, he filed a motion for more time that the court granted the same day. On September 25, Mr. Bloate filed something with the court called a "Waiver of Pretrial Motions" - it indicated that he wasn't going to file any pretrial motions (it was well named).

On October 4, the district court had a hearing, where it asked Mr. Bloate if he understood he could file motions and was deciding not to on purpose - this is, whether the waiver was knowing and voluntary. It was, and nothing happened until the government filed motions on February 23 of the next year, which stopped the clock.

There are more than 70 days between August 24 and February 23.

The Supreme Court looked at this timeline and was called to resolve whether the time Mr. Bloate had to prepare pretrial motions, from when the scheduling order issued on August 24 until the court's hearing on October 4 was excludable. In an opinion by Justice Thomas, the Court concluded that it isn't.*

The Eight Circuit then had the case on remand to see if filing a "Waiver of Pretrial Motions" counts as a pretrial motion. If it does, the time while it was pending would be excluded. The Eighth Circuit walks through a number of reasons why it isn't (in the same way that a waiver of a right to a trial is not a trial). The court of appeals concludes that a "Waiver of Pretrial Motions" is not a pretrial motion.

But, just when you thought Mr. Bloate was going home and avoiding 30 years in prison, the Eighth Circuit directed the district court to decide whether Mr. Bloate's indictment should be dismissed with prejudice or without - basically whether the government could just seek a new indictment to bring charges against Mr. Bloate anew.

What do you think the district court will decide?


* Justice Thomas's originalism has been the subject of a lot of attention lately, thanks largely to Jeffrey Tobin's piece in the New Yorker. This opinion looks like a kind consequence of originalism - you stick with what the words actually mean, even if they make prosecuting people harder.

September 9, 2011

A Federal Judge Dismisses An Indictment On A Pretrial Motion Based On Determination About The Facts In The Case, And All I Do Is Complain

One of the massively frustrating things about federal criminal procedure is that you cannot normally challenge, through a pretrial motion, whether the facts that the government think happened actually violate some criminal law.

By contrast, in a civil case, if I'm suing you, you can file a motion that says my lawsuit should be dismissed. This is a good thing.

For example, suppose I file suit against you and say, in my complaint, "You gave me a banana. That was negligent. The Court should give me 20 million dollars. A jury trial is requested." The very first thing you would do is file a motion that says "Matt said that I was negligent, but didn't say how, other than that I gave him a banana, which is not normally negligent. His law suit should be dismissed."

And, when a judge read that, he, or she, would seriously think about whether to dismiss my lawsuit, before everyone spent thousands of dollars preparing and worrying and yelling at each other on the phone.

In a criminal case, though, this is normally not possible. The government can put in an indictment "Larry gave Susan a banana. He distributed cocaine in violation of 21 U.S.C. S 841 in the District of Columbia." and that will pass muster. If the person charged with the crime tries to file a motion to dismiss, they'll lose - Federal Rule of Criminal Procedure 7 requires just about nothing in the way of factual specificity. On to trial you'll go.*

Sometimes, the government and the defendant agree about what happened for the purposes of a pretrial motion. The government thinks that it was a crime, and the person accused thinks that it wasn't a crime. Normally, there is little way for the person accused to ask the court if the conduct was a crime, before everyone spends a tremendous amount of money, and the person accused of the crime undergoes a tremendous amount of stress. The most reliable way to handle something like this is on a stipulated facts trial, like in the Ninth Circuit's case on racially motivated threats against President Obama. Of course, then the person charged with the crime doesn't get to have a meaningful trial.

Most federal district court judges, in most cases, will not consider a motion to dismiss an indictment if it relies on any assumptions about what the facts of the case are.

Happily, Judge Boasberg on the United States District Court for the District of Columbia,** granted a motion to dismiss a count on an indictment based on a pretrial determination about the facts in the case in United States v. Nitschke.

Judge Boasberg dismissed an indictment where the facts of the case - as set out by pretrial motion which were not objected to by the government - showed that there was no crime.

The opinion defends the normal practice, though, asserting that,

"[i]t would certainly be improper to force the government in the normal case to proffer its evidence pretrial so that the defense might test its sufficiency. That could, for instance, curtail the government's ability to obtain additional evidence or locate additional witnesses."

I just don't understand that point. What would be bad about putting the government's theory of the evidence to the test? If there are additional witnesses the government needs, why is it indicting?

Robust pretrial motions practice in civil cases - dismissing bad lawsuits before they go too far - is a good thing. It saves money, time, and stress.

What's so broken about our civil justice system that it won't work for criminal cases?

* Though perhaps you could file a motion to strike the part about the banana. It's kind of surplus language.

** Yes, this is is strictly speaking not about a federal criminal appeal. Here's to hoping it doesn't undermine the thematic content of this blog too much.

September 9, 2011

The Second Circuit Joins The Ninth In Rejecting Restitution In A Child Porn Case

As devoted readers will recall, the Ninth Circuit recently rejected a restitution claim by a woman who was depicted in child pornography when she was a child. The Second Circuit just agreed with the Ninth Circuit, in United States v. Aumais. Yet another Circuit jumps on the anti-restitution for child porn victims freight train.

The Second Circuit held that "proximate cause is a deeply rooted principle in both tort and criminal law that Congress did not abrogate" when it created the statute that allows restitution, 18 U.S.C. S 2259. Because the woman seeking restitution couldn't show that the defendant's conduct was a proximate cause of her harm, her restitution award was vacated.

The opinion in Aumais rejects a restitution claim made by the same woman that was at issue in the prior Ninth Circuit case, Kennedy, and for the same reasons.

All of this got me thinking. In both opinions, the woman, "Amy", describes feeling trauma whenever she gets a victim notification from the United States Department of Justice. Why they doesn't DOJ just stop sending notices?

In any event, the Second Circuit now agrees with many others that if the district court is going to charge some one for the financial costs of a crime, the person has to have caused the harm that the court is holding the person responsible for.

September 8, 2011

Maybe the Fourth Circuit is trying to protect its brand?

Orin Kerr, one of the Volokh conspirators, published on that august blog the rates of unpublished opinions of the federal courts of appeals from September 2009 to September 2010. As a guy who practices in the Fourth Circuit, I knew they had a thing for unpublished opinions, I just didn't realize how far out of line the Fourth Circuit is from its sister circuits.

Here's the table:

Circuit/Percentage of Opinions that are Unpublished

4th Circuit/ 93.0%

3rd Circuit/ 89.8%

11th Circuit/ 89.6%

2nd Circuit/ 88.3%

5th Circuit/ 87.4%

9th Circuit/ 86.9%

6th Circuit/ 83.6%

10th Circuit/ 77.5%

8th Circuit/ 71.8%

1st Circuit/ 65.1%

DC Circuit/ 62.3%

7th Circuit/ 59.8%

What is up with that? It's massively frustrating for litigants to think that their case doesn't matter. When the court stamps -- on 93% of it's cases -- language that says, in effect, "we're not going to pay attention to this decision later", the court undermines the confidence that litigants have that they're getting a fair shake.

What explains the Fourth Circuit's much higher rate of unpublished opinions, particularly in comparison to the D.C. Circuit? Do they have three times the number of Anders briefs?

September 8, 2011

The First Circuit Vacates A Conspiracy Conviction

Federal conspiracy charges are challenging. What counts as a conspiracy is broad enough to make conspiracy charges a favorite of federal prosecutors. Yet, the precise bounds of any given conspiracy are very difficult to trace.

Courts swing back and forth between whether to restrict conspiracy charges or let federal prosecutors have a freer reign with them. Opinions, or, worse, jury instructions, setting out the evidence required to prove a conspiracy swing back and forth.

On one hand, the government has to show that there's an agreement between the people who are supposedly in the conspiracy. On the other hand, an agreement doesn't have to be in writing, or even acknowledged as an agreement, and it can be inferred from the actions of the people who are accused of a crime. Yet mere temporal or physical proximity between the alleged co-conspirators is not enough to prove a conspiracy. Though a person can become a co-conspirator without knowing all the parts of the conspiracy, mere knowledge of the conspiracy is not enough to make a person a conspirator.

Reading these opinions reminds me of the Simpson's Halloween Special where Homer buys a toy for Bart at a creepy ancient medicine store:

Shopkeeper: [Homer has agreed to purchase a Krusty doll for Bart's birthday] Take this object, but beware it carries a terrible curse!

Homer: Ooh, that's bad.

Shopkeeper: But it comes with a free frogurt!

Homer: That's good.

Shopkeeper: The frogurt is also cursed.

Homer: That's bad.

Shopkeeper: But you get your choice of toppings.

Homer: That's good!

Shopkeeper: The toppings contain potassium benzoate.

[Homer looks puzzled]

Shopkeeper: ...That's bad.

Homer: Can I go now?

(the clip is available on Hulu here - sorry for the lack of embeddable video)

The First Circuit's recent decision in United States v. Szpyt illustrates a serious problem with conspiracy prosecutions - the conspiracy the prosecutor thinks he or she has, and sets out in the indictment, may not actually be the conspiracy that gets proven at trial.

In Mr. Szpyt's case, he was charged with being in a single conspiracy to distribute cocaine and marijuana with a man named Sanborn (who was also charged). They were alleged to sell both kinds of drugs to and with the members of a biker gang in Maine named the Iron Horsemen.

The government put on a wealth of evidence that Sanborn ran what the First Circuit called a "marijuana distribution emporium." Sanborn sold marijuana and cocaine - the evidence at trial only showed that Szpyt sold cocaine. There was no credible evidence that Szpyt was a marijuana dealer.

Because the government said that both Sanborn and Szpyt both sold both drugs, they argued that the government's evidence showed a different conspiracy than the one the government described in the indictment.

As the First Circuit explained the problem,

Perhaps this case is best understood if we think of Sanborn as a drug supermarket owner, who sold different products, cocaine and marijuana, rather than bananas and tomatoes, from different distributors: cocaine from the . . . Szpyt chain and marijuana from the Demarco and Boivin-Chase suppliers. Were we actually considering such fruit distribution chains in the context of an actual supermarket, we would be hard put to argue that the intersection of those two separate fruit product distribution chains would be of any legal significance as far as somehow making the members of the two separate chains overall business partners. Neither would it be reasonable to argue that merely distributing tomatoes to the supermarket, by itself, would make the tomato distributor a partner in the supermarket's overall business of selling bananas and other foods. When we transfer this bucolic scenario to the present case, we can perceive no legally significant difference in the outcome. The Vizcaino-Dellosantos- Szpyt criminal conspiracy to distribute cocaine was a different criminal enterprise than the Boivin-Chase-Sanborn-Jordan marijuana enterprise, with different products, a different source of supply, different goals, and a different history. Similarly, distributing cocaine (rather than tomatoes) to Sanborn's drug supermarket does not, by itself, make Vizcaino, Dellosantos and Szpyt partners in Sanborn's drug supermarket business of distributing cocaine and marijuana.

Thus, the First Circuit ruled, the government's evidence varied from the allegations in the indictment. The evidence showed that two conspiracies existed, not one.

Not all variances require a reversal though. The court of appeals will only find that the government's failure to prove what it said happened triggers a reversal if it prejudices the person convicted.

Here, the First Circuit found that there was substantial prejudice. The defendant, and his lawyer, went to trial thinking they were responding to one kind of conspiracy. When they got there, they faced evidence of another. The First Circuit held that this unfairly compromised their ability to prepare for trial.

Accordingly, the court of appeals vacated the convictions.

If you have questions about how federal criminal charges are different than state criminal charges, please visit this page on Maryland federal criminal charges.

September 7, 2011

Please say nice things about this blog to the ABA

Dear readers,

The American Bar Association is asking people to tell it what law-related blogs are good.* If you like this blog, I would very-much appreciate it if you would say something nice to the ABA about it. The ABA puts together a list of the 100 law-related blogs in the country that it thinks are funny, cool, or reflect good parenting by the blogger's Mom and Dad. These blogs are crowned the best blogs in the country.

Much like The Onion's campaign to win a Pulitzer Price, I suspect my quest for honor may not be rewarded. At least I didn't ask Tom Hanks to do a YouTube video.

Here is the link to say nice things about a blog to the ABA. The deadline's September 9, 2011, which is Friday (the day after tomorrow)

If you don't like this blog, please feel free to send me an email telling me why (yes, you can use profanity). You can email me here.

Ok, that's enough self-promotion in one day for a guy raised in Iowa.

* Many in this world call a law-related blog a "blawg", including the ABA. I don't, mainly because the phrase sounds, to my ear exactly like "blog." When I try to say it out loud so that there is a difference in the way it sounds compared to "blog", the word feels too chewy to me -- like a raisin stuffed with cold oatmeal. But far be it for me to tell you, or the ABA, how to refer to a law-related blog. Use the language any way you'd like.

September 7, 2011

How The Eighth Circuit Saved Christmas

Legislators like to punish repeat offenders. That's just good politics - "Mike Sloss puts repeat offenders behind bars" sounds better than "Mike Sloss has a balanced policy on recidivism" when put on a bumper sticker.

So it isn't surprising that the Armed Career Criminal Act, located at 18 U.S.C. S 924(e)(1), jacks up the penalties for a person convicted of being a felon in possession of a firearm if the person who is convicted has at least three prior convictions for drug dealing or a violent crime.

In a nod to fairness, though, Congress does require that those prior convictions be committed "on occasions different from one another."

What counts as an "occasion" though? The Eighth Circuit, in United States v. Willoughby, faced exactly that question.

Mr. Willoughby pled guilty to being a felon in possession of a firearm. At sentencing, the district court had to figure out if one of Mr. Willoughby's prior convictions counted as one prior conviction, or as two. He had been convicted of two counts of conduct in the one previous case.

According to the police report in the prior case, an undercover cop went with a confidential information to Mr. Willoughby's house. The affidavit in support of the complaint said that when the officer and CI got there,

Michael Willoughby was sitting in a chair in the northeast corner of the living room. . . . Willoughby was wearing a tan/off white t-shirt and blue jeans. He was also wearing red suspenders hanging down by his legs. These are commonly referred to as ["]braces["] by Neonazi/skinhead groups.

Undeterred by the menacing "braces", the law enforcement officer and the CI asked Mr. Willoughby if they could by drugs. Willoughby left the room to get some drugs.

When Willoughby returned to the living room he had two sandwich bags containing a green leafy substance in his hand. He started to give both to the C/I. I held out my left hand. Willoughby gave one to the C/I then gave one to me. The C/I gave Willoughby the $25 I gave him. I gave Willoughby $50. I smelled the contents of the bag Willoughby gave me. It smelled and looked like marijuana. We immediately left the house.

The district court found that this course of conduct was actually two different "occasions." Because handing the drugs to the undercover cop was a different "occasion" than handing drugs to the CI, this transaction gave rise to two drug offenses. Willoughby was, therefore, determined to be an Armed Career Criminal. As a result, he faced a mandatory minimum sentence of fifteen years.

If Willoughby had handed all the drugs to the CI, perhaps it would have been one "occasion." But that quarter of a second between when the CI took the drugs and when the undercover cop did, Willoughby restarted the "occasion" clock, according to the sentencing judge.

So many "occasions"

This makes me wonder what holidays, and other special "occasions", are like at the district judge's house. Personally, I like special "occasions" because they're a time with family. Hearing of the district court's approach to the term "occasion" in our shared language, though, makes me think that I'm wrong.

Apparently, at Thanksgiving, when I take a piece of turkey, it's a different "occasion" than when I take the mashed potatoes. And there's no "occasion" where I get to eat with my family all gathered together - by the time my dad takes his food, it's already a different "occasion" than when my son did.

No wonder so many people feel lonely around the holidays.

Happily, the Eighth Circuit rejected an interpretation of "occasion" that leads to such isolation.

The Eighth Circuit held that Willoughby's drug dealing was a single "occasion" because "the sale was, in actuality, one 'continuous course of conduct.'"

There are strict limits, though, to what counts as one "occasion" even for the Eighth Circuit. The court of appeals explained

"'[c]rimes occurring even minutes apart can qualify [as separate 'occasions'] if they have different victims,' thereby reflecting a lack of substantive continuity, 'and are committed in different locations,'

As guidance for the holidays, I think that means that if your dad and brother go out to the radial-arm saw in the garage to have a cigar and a glass of cognac, they aren't celebrating the same special "occasion" as the folks inside still finishing off the pecan pie. At least according to the Eighth Circuit.

Though that result, at least, seems consistent with my own intuitions.

September 6, 2011

More Valor Stolen From The Stolen Valor Act

The Stolen Valor Act, at 18 U.S.C. 704, makes it a federal crime to lie about having certain military honors.

The Ninth Circuit, in an opinion that can almost never be quoted enough, held that the Stolen Valor Act is unconstitutional. Judge Kozinksi writes,

Saints may always tell the truth, but for mortals living means lying. We lie to protect our privacy ("No, I don't live around here"); to avoid hurt feelings ("Friday is my study night"); to make others feel better ("Gee you've gotten skinny"); to avoid recriminations ("I only lost $10 at poker"); to prevent grief ("The doc says you're getting better"); to maintain domestic tranquility ("She's just a friend"); to avoid social stigma ("I just haven't met the right woman"); for career advancement ("I'm sooo lucky to have a smart boss like you"); to avoid being lonely ("I love opera"); to eliminate a rival ("He has a boyfriend"); to achieve an objective ("But I love you so much"); to defeat an objective ("I'm allergic to latex"); to make an exit ("It's not you, it's me"); to delay the inevitable ("The check is in the mail"); to communicate displeasure ("There's nothing wrong"); to get someone off your back ("I'll call you about lunch"); to escape a nudnik ("My mother's on the other line"); to namedrop ("We go way back"); to set up a surprise party ("I need help moving the piano"); to buy time ("I'm on my way"); to keep up appearances ("We're not talking divorce"); to avoid taking out the trash ("My back hurts"); to duck an obligation ("I've got a headache"); to maintain a public image ("I go to church every Sunday"); to make a point ("Ich bin ein Berliner"); to save face ("I had too much to drink"); to humor ("Correct as usual, King Friday"); to avoid embarrassment ("That wasn't me"); to curry favor ("I've read all your books"); to get a clerkship ("You're the greatest living jurist"); to save a dollar ("I gave at the office"); or to maintain innocence ("There are eight tiny reindeer on the rooftop").

The Stolen Valor Act has recently been found unconstitutional by another jurist, Magistrate Judge DiGirolamo on the United States District Court for the District of Maryland. Here's the opinion. (for more coverage, see the Washington Examiner)

If you accept the premise set out by Garrett Epps in the Atlantic that the debate over the Stolen Valor Act is really just a debate about whether lies have First Amendment protection, then Judge DiGirolamo comes squarely down on a reading of a more expansive First Amendment. He writes,

First Amendment protection does not hinge on the truth of falsity of the matter stated. While some false speech may be proscribed, the Supreme Court has made it clear that not all of it is.
September 6, 2011

Summary Evidence And White-Collar Crimes: The Tenth Circuit Says You Can't Summarize What Isn't In Evidence

White-collar criminal cases present unique challenges. White-collar cases often involve vast amounts of information - in addition to a subject matter that's complicated and all the difficulties of a general federal criminal case.

For example, I had a case that had close to 60 gigabytes of evidence produced by the government, not counting the information that I collected through my own investigation.

The information deluge is a problem in figuring out a case. It's also a problem in figuring out how to present a case to a jury.

Yet the way this information is conveyed to the jury in a white-collar case is the same as in any trial - it is primarily explained through witnesses or other demonstrative evidence. No trial lawyer sends the jury back with 80 boxes of documents and tells them that if they examine it all, they'll reach the right verdict.

The government often handles this challenge by using summary evidence. Basically, the Federal Rules of Evidence lets a party introduce evidence that summarizes other evidence in a case. So, the government will frequently make a chart that summarizes what other documents in the case revealed, or what other witnesses said. The summary is admitted as evidence - it gets shown to the jury during trial and it goes back to the jury room during deliberations.*

Of course, summary evidence is often not a friend to the defense. By cherry picking the worst parts of the documents, the government can create an impression for the jury that's unhelpful in the quest for an acquittal.

The Tenth Circuit, in a mortgage fraud case, recently reversed (one count of) a conviction because the district court admitted a summary chart that was clearly inadmissible. The case is United States v. Irvin.

The core of the mortgage fraud case was that the people on trial - Mr. Vanatta and Mr. Miller - had provided false information on behalf of home buyers so that they could get mortgages. Mr. Sparks helped and was charged. He preferred his chances with the United States Attorney's Office's 5K1.1 committee, and testified for the government.

As the Tenth Circuit explained the allegations,

In order to ensure that otherwise unqualified buyers could obtain financing, Sparks and Vanatta enhanced such buyers' apparent creditworthiness by, among other things, overstating the buyers' income, altering bank statements to add deposits, and drafting false letters of employment. The mortgage lenders were further induced to extend financing through Miller's use of inflated home appraisals, overvaluing the relevant properties and thereby enhancing the lenders' perceived loan-to-collateral ratio.

If you've been reading the news lately, or purchased a home between 2003 and 2008, these kinds of allegations are probably not new to you.

The summary evidence in United States v. Irvin summarized a large number of loan documents.

The underlying loan documents, though, were not admitted into evidence. In fact, they were inadmissible as hearsay, because they contained thousands of statements of facts.

Hearsay, for the uninitiated, includes statements in documents that someone wants to get in front of a jury - it isn't limited to someone repeating what another person said from the witness stand.

So, if you have an email from Larry, and Larry describes something that happened, Larry's email is hearsay.

Hearsay can be a part of a trial, but there has to be an exception that applies to allow it to be admissible. There are many hearsay exceptions.**

One hearsay exception is for business records. If, for example, a mortgage company keeps certain records for it's business, and you can meet certain criteria, and have someone from the mortgage company testify that those criteria are met, then you can introduce the loan documents.

Though in Irvin, the government didn't do that. It had no witness from the company to show that the hearsay exception applied, so it wasn't able to admit them.

Since the documents that made up the summary document were inadmissible, the summary document itself was inadmissible.

* This is not the same, as a matter of legal doctrine, as a summary witness. The government really likes to use those too. When the government uses a summary witness, an agent will get on the stand and basically narrate what she can about what happened in the case - it's like the government gets to provide another opening statement. As the D.C. Circuit has observed, there are some problems with summary witnesses too.

** Here's a cute video on hearsay exceptions that may not make any sense if you haven't been to law school.

(Why do lawyers think it's funny to see legal terms used in a song?)

September 5, 2011

My Guest Post on the American Constitution Society Blog

Happy Labor Day!

I hope you're spending the day with something, or someone, that isn't on the internet. In case my hopes are frustrated, and you're looking for something to read, I have a guest post on the American Constitution Society's blog:

What Can the Rumble in Rhode Island Tell us About the Obama Administration and the Death Penalty?

September 2, 2011

A Man's Cleverness Reduces His Sentence By 14 Years: The Ninth Circuit, Apprendi, and Pleading Open

Stacy Hunt - a man with multiple prior convictions, who attempted to pick up a package of drugs at an airport in Alaska, flipped on others involved in the drug deal, then fled to California where he was rearrested - appears to have outsmarted the United States Department of Justice and a federal district court judge.

The case is United States v. Hunt, from the Ninth Circuit.

To see how Mr. Hunt was clever, you need to understand two rules of federal criminal law.

First, 21 U.S.C. S 841(a)(1) prohibits possessing drugs with the intent to distribute. The statute prohibits possessing any controlled substance - it doesn't get specific as to the type of drug.

The statutory maximums for section 841(a)(1) for the different kinds of drugs are set out at 841(b). The language is a bit baroque, but, basically, if you violate section 841(a) for possessing cocaine, the statutory maximum is 20 years. If you violate section 841(a) for possessing a Schedule V drug - like codeine , the maximum is 1 year. See section 841(b)(3).

So, to be clear, the first thing you need to know is that the statutory maximum penalty for possession with intent to distribute depends on the kind of drug involved. If it's codeine, the statutory maximum is one year: if it's cocaine, the statutory maximum is twenty-years.

Second, the Supreme Court of the United States held, in Apprendi v. New Jersey that,

Other than the fact of a prior conviction, any fact that increases the penalty for a crime beyond the prescribed statutory maximum must be submitted to a jury, and proved beyond a reasonable doubt.

Mr. Hunt was charged with a violation of 21 U.S.C. S 841(a). He fired his lawyer and handled his case himself. He told the court that he wanted to enter a guilty plea - which is his right. He pled guilty to attempting to possess with intent to distribute a controlled substance.

Every plea has to have a factual basis for the judge to accept it - that is, the judge has to make sure that the person pleading guilty admits facts that meet each and every element of the crime.

Here's how the Ninth Circuit recaps the conversation that the court had with Mr. Hunt to make sure he admitted that he violated section 841(a):

First, in response to the court's inquiry regarding the elements of the offense, the Assistant United States Attorney (AUSA) stated that the government would need to prove at trial that Hunt "attempted to possess a parcel that contained a little over a kilogram of cocaine . . . and that he did so knowingly." Hunt stated that he understood those elements. After a few moments passed, the AUSA stated that he forgot to include the element that "Mr. Hunt attempted to possess that cocaine with the intent to distribute it thereafter." Hunt responded that he understood that additional element.

The court then restated the elements of the offense as follows: "So you attempted to possess cocaine, you knew it was cocaine or some illegal drug, and you did it with the intent to distribute. I guess those are the three elements, okay?"(emphasis added). Hunt replied, "To those elements, yes, I agree." Hunt then asked that the government state the elements one last time. The AUSA responded that the government would have to prove that "Mr. Hunt attempted to possess a parcel which contained a little over a kilogram of cocaine [and] . . . [w]e'd have to prove that Mr. Hunt's attempt to possess that cocaine was done knowingly and then we'd have to prove that he intended to distribute that cocaine after coming into possession of it." Hunt replied, "Yes I understand those elements. As far as the specific amount, I don't have personal knowledge of it . . . as I never opened the package and weighed it, but I do accept responsibility for whatever it was."

After the government stated the facts it expected to prove if the case were to proceed to trial--including that Hunt was found in possession of a package of over 500 grams of cocaine and later admitted that he had ordered the drugs in a written statement--Hunt said, "For the most part, the facts are true. I admit all the elements of 841(a)(1), and also as I said, I did not receive the package and open it, so I have no specific knowledge of what it contained other than it did contain a controlled substance, that I do know, and I did attempt to possess that controlled substance." Hunt also confirmed that he had intended to sell or give away the controlled substance. The court then asked the government, "That sounds sufficient, doesn't it, counsel?" The AUSA agreed that Hunt's admission was sufficient to supply a factual basis for the offense, and the court accepted Hunt's plea.

The presentence report determined that Mr. Hunt's crime involved cocaine. Accordingly, the presentence report found that the statutory maximum was 20 years.

The sentencing court adopted this finding, and determined that a 20-year statutory maximum applies to Mr. Hunt.

Mr. Hunt objected to this determination, and he had this exchange with the sentencing court:

HUNT: Also, when I made my objections, which has been overlooked, I also objected on the grounds that I did not at plea colloquy admit to a specific type of controlled substance, and I only agreed that I attempted to possess a controlled substance.


HUNT: Not crack, cocaine, or marijuana, or anything like that. I only agree to a Schedule II -- not even a Schedule II. I only agree to a controlled substance. So are you also making a finding for the type of drug also?

THE COURT: Yes, okay.

HUNT: So I'd like to make sure that my (indiscernible) objection is in for not just quantity but also as to type of drugs. And my position is that I should fall back to marijuana for no remuneration, with a statutory max of five years [sic], up -- under (b)(1)(D).

THE COURT: Very well. Boy, you're smart. You've made your record, but I -- you haven't changed my mind.

HUNT: Okay, that's fine.

The sentencing court heard evidence as a part of the sentencing proceeding. Folks testified that the drugs were cocaine. Mr. Hunt was sentenced on the assumption that the statutory maximum is 20 years. The court gave him a sentence of 15 years in prison.

On appeal, the Ninth Circuit found that the district court's sentence is not consistent with Apprendi. Because Mr. Hunt did not admit that the controlled substance was cocaine, rather than, say, codeine, and no jury found that the drugs were cocaine, the statutory maximum cannot be more than one year. As the Court held, "any fact that increases the penalty for a crime beyond the prescribed statutory maximum must be submitted to a jury, and proved beyond a reasonable doubt."

Mr. Hunt's sentence was vacated, and the Ninth Circuit remanded the case with instructions to sentence Mr. Hunt with a statutory maximum of one year.

September 1, 2011

Why The Government Has To Prove They Don't Make Computers in Iowa

Rarely has conduct at a hockey game exposed such an interesting constitutional feature of federal criminal law.

Randy Johnson was taking photographs at a hockey game in Des Moines, Iowa. He was a professional photographer. His assistant, Dawn, was helping by removing memory cards from Mr. Johnson's cameras and transferring the photographs on those memory cards onto his laptop.

While she was downloading and organizing his photographs, she noticed a folder labeled "girls". They appeared to be photographs of girls - not women referred to in a mildly sexist way. Without going into details, photographs of such a nature as those are illegal to possess.

Dawn took the laptop to a police officer at the hockey game. The police officer took Mr. Johnson to the police station.

He was indicted for receiving child pornography and possessing child pornography. He went to trial and was convicted on both counts. The sentencing judge imposed a sentence of 120 months on the possession count and 136 months on the receipt count. The sentences were to run concurrent.

Mr. Johnson appealed his sentence on two grounds. First, that the evidence wasn't sufficient for a conviction on the receipt count. Second, if it was, double jeopardy bars a prosecution for both. (astute readers will recall seeing this issue before).

In United States v. Johnson, the Eighth Circuit reversed Mr. Johnson's conviction - why the conviction was reversed exposes an interesting constitutional trick at the core of many criminal statutes.

To find someone guilty of receipt of child pornography, you need to prove, basically, that the person received child pornography using something that crossed a state line. More specifically, the government has to prove that the person received child pornography

using any means or facility of interstate or foreign commerce or that has been mailed, or has been shipped or transported in or affecting interstate or foreign commerce, or which contains materials which have been mailed or so shipped or transported, by any means including by computer, or knowingly reproduces any visual depiction for distribution using any means or facility of interstate or foreign commerce or in or affecting interstate or foreign commerce or through the mails

18 U.S.C. 2252(a)(2)

This is normally called the "jurisdictional element" - it's an element of the crime, and the only reason it's there is to make sure that Congress has the power to make the law.

Congress cannot make any law that it wants - rather it needs to make sure that every law it makes is made through the exercise of some power delegated by the constitution.

The most popular clause for Congress to use to justify it's power to make law is the Commerce Clause. This is the justification offered for Congress's power to enact the health care reform law, slowly making it's way to the Supreme Court. Justice Thomas has distinguished himself by wanting to roll back the breadth of the Commerce Clause. That Clause is kind of a big deal.

In federal criminal cases, the jurisdictional element, and the Commerce Clause in general, is very rarely a deal.

In Mr. Johnson's case, two errors combined, and, as a result, the government did not prove that Mr. Johnson's receipt of child pornography affected interstate commerce.

First, the government charged that the images were downloaded from the internet in the indictment. Downloading from the internet, a means of interstate commerce, counts. Yet, at trial, the government's own expert testified that he wasn't sure if the pictures came from the internet - there are a lot of ways to transfer files and he could have gotten them from a CD or DVD from someone else.

Second, the trial court gave the wrong instruction to the jury about the jurisdictional element. The judge instructed the jury that, to find Mr. Johnson guilty, they would have to find that

"[t]he material[s] containing the [illicit] visual depictions were produced using materials that had been mailed, shipped, or transported by computer in interstate or foreign commerce."

As the court of appeals explained, the Eighth Circuit has previously held that if the government shows that the computer used to download the contraband crossed state lines before the child pornography was downloaded, that's enough to meet this element.

And, of course, it's easy as rhubarb pie to show that a computer in Iowa crossed state lines - they don't make computers in Iowa.

Yet, because the government failed to introduce evidence that met the jurisdictional element, Mr. Johnson's conviction cannot stand.