June 2012 Archives

June 13, 2012

The Tenth Circuit Offers A Recent History Of Fake Drug Checkpoints And The Fourth Amendment

No one likes a liar.

Well, almost no one. Chief Judge Kozinski seems to like liars, at least some of the time.

But, generally, lying leaves a bad taste in our societal mouth. This is true even when the police do the lying.

1377780_highway_in_the_sky.jpgDriving Through Rural Kansas

Dennis Neff was driving through rural Kansas on the interstate around noon in late July. He passed signs that warned of a drug checkpoint ahead in Spanish and English. The signs warned that drug dogs were in use.

Instead of continuing to the checkpoint, Mr. Neff pulled off at the next exit onto Spring Creek Road.

Spring Creek Road is "a rural, gravel road speckled with residences but no businesses."

It may go without saying that Mr. Neff was not from around those parts.

The Police Lied

As it happens, there was no drug checkpoint. That would have taken time, resources, and money.

Instead, the police were watching who pulled off onto Spring Creek Road to avoid the drug checkpoint, especially cars that didn't seem to be from the area.

A trooper in a marked police car followed Mr. Neff's car after it turned off onto Spring Creek Road. Mr. Neff passed a driveway, then turned into a second driveway.

As he started to back his car out of the second drive way to turn around, back in the direction of the interstate, he saw the trooper.

The trooper said later that Mr. Neff looked startled to see him.

Mr. Neff tried to drive back toward the interstate, but the trooper ordered him to stop. The trooper approached Mr. Neff's car, pulled him out and gave him a pat down search. He found nothing.

Mr. Neff, pretty close to immediately after the pat down, told the trooper that he was carrying a crack pipe.

In a search of the car a few minutes later, they trooper found seven kilogram-sized bags of cocaine in the car.

The District Court Proceedings

Mr. Neff was charged with conspiracy to possess with intent to distribute cocaine and possession with intent to distribute cocaine.

He filed a motion to suppress, challenging his stop. At the hearing, the trooper explained why he thought he had reasonable articulable suspicion to stop Mr. Neff:

The reason I stopped him is they got off the interstate after seeing the drug check lane ahead signs, it was a Shawnee County car went into a rural Wabaunsee County area, pulling into a driveway where I don't think the vehicle belonged, the surprised look that the driver gave me, the short time that they stayed there, the surprised look that he gave me. I thought something is very suspicious about this that I didn't really care for or didn't like. Therefore, I stepped out of the vehicle when he pulled out. That's when I stopped them.

The district court thought that was good enough and denied the motion. Mr. Neff convicted and sentenced to five years in prison.

The Appeal to the Tenth Circuit

In United States v. Neff, the Tenth Circuit reversed.

The standard is well-known, but here's how the 10th Circuit explained it,

This case presents the familiar question of what level of proof is required to establish reasonable, articulable suspicion of criminal activity. As a general matter, "police can stop and briefly detain a person for investigative purposes if the officer has a reasonable suspicion supported by articulable facts that criminal activity 'may be afoot,' even if the officer lacks probable cause." United States v. Sokolow, 490 U.S. 1, 7 (1989) (quoting Terry, 392 U.S. at 30). In reviewing an investigatory stop for reasonable suspicion, we must consider "the 'totality of the circumstances' of each case to see whether the detaining officer has a 'particularized and objective basis' for suspecting legal wrongdoing." United States v. Arvizu, 534 U.S. 266, 273 (2002) (quoting United States v. Cortez, 449 U.S. 411, 417-18 (1981)). While certain facts, taken in isolation, may be "quite consistent with innocent travel," these facts may, in the aggregate, add up to reasonable suspicion.

Of course, an actual drug checkpoint is unconstitutional - according to the Supreme Court in City of Indianapolis v. Edmond.

But the "ruse" drug check point is a clever twist - maybe that's ok!

As the Tenth Circuit explained, fake drug checkpoints v.1.0 worked like this:

In the wake of Edmond's rebuke of suspicionless drug checkpoints, some lawenforcement organizations began the practice of setting up ruse drug checkpoints. In what may be understood as the first generation of post-Edmond drug checkpoints, police would set up "drug checkpoint ahead" signs on the highway but then operate a full-scale checkpoint at the next (likely rural) off-ramp. The theory behind this alteration was that the police would have an element of individualized suspicion for every vehicle that took that ramp because there were few "legitimate" reasons for using an exit in an isolated area.

The Eighth Circuit said these are generally not ok - here's how the Tenth Circuit summarized the Eighth Circuit's opinion:

The court recognized that while the modified program differed from the practice in Edmond, the same constitutional problems persisted. While some drivers may have taken the exit to avoid police conduct, that did not "create individualized reasonable suspicion of illegal activity as to every one of them." Id. "Indeed, as the government's evidence indicated, while some drivers may have wanted to avoid being caught for drug trafficking, many more took the exit for wholly innocent reasons--such as wanting to avoid the inconvenience and delay of being stopped or because it was part of their intended route."

Mr. Neff was caught in version 2.0 of the fake drug checkpoint - one has to love the way law enforcement innovates. Version 2.0 is some signs in front of a rural road that no one would want to turn off on (perhaps including those who lived along it).

This turned out not to be ok.

The Tenth Circuit, agreeing with the Eighth Circuit, noted that

a driver's decision to use a rural highway exit after seeing drug checkpoint signs may serve as a valid, and indeed persuasive, factor in an officer's reasonable suspicion analysis. (listing as one valid factor that "the defendants took an exit which was the first exit after a narcotics check lane sign, and an exit that was seldom used"). But standing alone, it is insufficient to justify even a brief investigatory detention of a vehicle.

There wasn't anything else present that tipped things over the edge into reasonable articulable suspicion for the court of appeals. Indeed,

The connection between the checkpoint signs and Neff's decision to use the nearby Spring Creek Road exit was tenuous. There was no testimony that Neff suddenly swerved to make the exit, changed lanes abruptly, or otherwise drove erratically in response to the signs.

As to Mr. Neff's decision to turn around in a driveway:

Neff's decision to turn around in a driveway is plausibly evasive. The government suggests turning around in the driveway was part of Neff's pattern of evasive conduct, but without some evidence Neff was even aware of the trooper's presence, his turning around in the driveway provides minimal support to justify the stop. In contrast, the defendant in Carpenter realized he was being followed, made a U-turn, and pulled to the side of the road and stopped. Similarly, Neff's "startled look" adds little of value to the equation. Exhibiting surprise at the sudden appearance of an officer on a rural road is hardly comparable to . . . "nervous, evasive behavior."

So, the Tenth Circuit concluded that the stop was not permissible.

These facts, when taken together, do not fairly suggest that Neff was attempting to evade police. To be sure, an officer is "entitled to make an assessment of the situation in light of his specialized training and familiarity with the customs of the area's inhabitants." But even considering the totality of the circumstances, Neff's conduct conformed to the patterns of everyday travel.

Because he shouldn't have been stopped in the first place, Mr. Neff's conviction was vacated, and he is free to go.

According to the BOP webpage, he was released from custody on Monday.

June 12, 2012

The Tenth Circuit Holds That A Federal Sentencing Expert Was Correct That His Own Federal Sentence Was Wrong

Howard Kieffer really liked federal sentencing practice.

He co-counseled in cases in federal district court and some federal circuit courts. He gave presentations on how people who are facing a sentencing hearing can prepare, and he helped people who were going to the Bureau of Prisons position things so that they could make an easier transition.

Mr. Kieffer even ran a website and a listserve for people who were interested in sentencing and the Bureau of Prisons - lots of lawyers contributed.

Sadly, though, as the 10th Circuit, in United States v. Kieffer, noted:

All the while, [Mr. Kieffer] had a secret. He is not and never has been an attorney. He never went to law school, never sat for a bar exam, and never received a license to practice law.

68920_law_education_series_5.jpgGail Shifman

In 2006, at a conference for the National Association of Criminal Defense Lawyers, Mr. Kieffer met Gail Shifman - a criminal defense lawyer in San Francisco. One can imagine that they discussed lawyer stuff - cases and clients and how to work in a broken system.

At some point, though, Ms. Shifman learned that Mr. Kieffer was not a lawyer. She emailed him.

It was a pointed email. Ms. Shifman wrote:

if it is correct that you are not a licensed attorney, then you've directly lied to me on more than one occasion.

Mr. Kieffer's response may not have been as direct. Among other things he wrote:

In short, I am "licensed"--if that is the operative term (and I am not sure that it is) in no state, but I have been admitted (for various purposes) or specially appeared in accord with local rules) in certain (federal) jurisdictions.

I went to Antioch Law School--and graduated.

Somehow, Ms. Shifman was not satisfied with this response. She contacted the FBI.

As the 10th Circuit noted, "this was not the first time the FBI received a complaint about [Mr. Kieffer's] legal escapades."


As it happened, Mr. Kieffer came to enter his appearance on behalf of a person charged with a crime in the United States District Court in Colorado. He appeared on the person's behalf at a competency hearing. The person was convicted.

Mr. Kieffer was paid $65,750 for this representation.

He was charged with wire fraud. Mr. Kieffer was convicted in a federal district court in Colorado.

Interestingly, this was also not Mr. Kieffer's first federal conviction.

North Dakota

Flash back to before Mr. Kieffer was convicted in Colorado.

Shortly after his Colorado client's trial, the District of North Dakota had issued a show cause order challenging some of the statements he made in an application for admission to that court.

Mr. Kieffer hired counsel to represent him with the North Dakota order. He admitted that he wasn't a member of any state bar, and that he didn't graduate from Antioch College of Law.

He was convicted in federal court in North Dakota of making a materially false application to the court and sentenced to 51 months.

Back to Colorado

He was then suspended from practicing law in the District of Colorado (which is a little funny when you think about it, since he wasn't a lawyer).

Then came his Colorado conviction and, later, sentencing.

Was North Dakota Any Different?

At sentencing, the court decided that this conduct was separate from his North Dakota conduct. This did not work into Mr. Kieffer's favor. Indeed, it looks like a pretty good approach if the court wanted to make things worse for Mr. Kieffer.

Treating the North Dakota sentence as separate did two things - each of which was challenged on appeal.

First, it meant that his North Dakota conviction counted as a prior conviction for criminal history purposes. Mr. Kieffer pointed out that the government's position was that he had engaged in a continuing scheme - his prior conviction was a part of that scheme.

The government agreed that this was error. The 10th Circuit did too.

More fundamentally, though, was whether Mr. Kieffer's sentence on this offense would run concurrent or consecutive to his North Dakota conviction.

To quote the 10th Circuit:

[Mr. Kieffer] rightly claims that in addition to its erroneous criminal history calculation, the district court erred in manipulating the calculation of his offense level so it could ignore U.S.S.G. § 5G1.3(b) and ostensibly impose a within guideline range sentence on him while running that sentence consecutive to the sentence he received in the District of North Dakota.

Section 5G1.3(b)'s "central aim" is to "ensure no defendant is punished twice for the same crime." Here, the district court counted Mr. Kieffer's related prior conviction as unrelated just to evade § 5G1.3(b). The 10th Circuit said that was incorrect.

Because the district court misapplied section 5G1.3, and miscalculated Mr. Kieffer's criminal history category by, in both cases, treating his North Dakota offense as unrelated, the case was remanded for resentencing.

It's good to see that Mr. Kieffer was vindicated in two ways - he won his appeal, and he showed that he is an expert at federal sentencing law after all.

June 7, 2012

Sometimes You Can Challenge An Agency Action In A Criminal Case, Says The Ninth Circuit

Ours is a large and complicated government. Much of it isn't run by statutes or cases, but by regulations.

Violating a regulation can be a crime - depending on the regulation.

Regulations are strange animals. They can be challenged under the Administrative Procedures Act. If you don't like what an agency does, the APA gives you a mechanism to complain about it to a judge.

1389337_mount_hood.jpgWhat happens if you're prosecuted for violating a regulation that can be enforced with a criminal penalty, and you think the regulation is no good? Can you complain about it in your criminal case?

The Ninth Circuit answered that, in United States v. Blacklund, with a resounding maybe.

Mr. Blacklund's Choice of Residence

Mr. Blacklund and his wife lived on a mine in a national forest. [FN1]

It was in the Umpqua National Forest in Oregon.

If you want to live on a mine in a national forest, you have to get the permission of the United States Forest Service.

The Forest Service will only give you permission to build a place to live on your mining site in a national forest if it's necessary to the mining operations to have a year-round residence in the forest.

As to the Blacklund's residence, the Forest Service determined that "year round occupation of the permanent camp trailer with the added room, roof, porch and fire wood storage area, is excessive even during the mining season."

The Blacklunds took exception to this decision, and things went back and forth with the Forest Service. Eventually, the Blacklunds appealed to the final level of administrative appeal within the Forest Service.

For those with an admin law background, they "exhausted their administrative remedies."

They did not then go to federal court to challenge the agency's determination.

Criminal Charges Are Brought

The U.S. Attorney's Office in Oregon then brought a misdemeanor criminal information against Mr. Blacklunds for violating 16 U.S.C. § 551 and 36 C.F.R. § 261.10(b).

Mr. Blacklund indicated that he intended to challenge the agency's action, as he would if he brought a suit against them through the APA. Mr. Blacklund wanted to assert that challenge as an affirmative defense.

The district court shut him down, preventing him from making such an affirmative defense.

He entered a guilty plea that preserved his ability to challenge the district court's decision.

The Administrative Procedures Act, Criminal Charges, And the Ninth Circuit

The Ninth Circuit reversed his conviction. It held that a person charged with a crime based on an agency action is able to challenge the agency's decision as an affirmative defense under certain circumstances.

The Ninth Circuit noted that there is a six-year statute of limitations for bringing a suit in federal court to challenge an agency action.

So, anytime during that six-year period, if the person exhausted their administrative remedies by previously challenging things with the agency, the person could bring a lawsuit to challenge the agency's action.

As the Ninth Circuit held,

We therefore hold that the APA affords a person in Blacklund's position at least two options for obtaining judicial review of the disputed agency action. He may file suit in federal district court under the APA, or he may challenge the agency's decision in a subsequent criminal proceeding. In either case, he must act within the six-year time limit.

Because a district court's erroneous decision to preclude a defense requires reversal unless the error is harmless, the conviction was vacated and the case was sent back.

What Happens Next?

One thing I don't understand from this is how the agency's action is challenged in the trial.

Normally, the legality of an agency's action is a question that a judge resolves. Normally, affirmative defenses are resolved by the jury.

Does the jury have to make the determination of whether the Forest Service's action complied with, say, the authorizing statute? Are they to be given jury instructions in Chevron deference?

[FN1] - There are mines in national forests? Huh?

June 6, 2012

I'm Also Writing At Above The Law

Faithful readers,

I hope this finds you well.

1038827_u_s__supreme_court_1.jpgI know you come here for the very best in myopic and cheeky descriptions of federal criminal appeals. Thank you for your readership.

I wanted to let you know that I'm also writing a column over at Above the Law about the Supreme Court - and not just about federal criminal stuff. I wrote last week about how dull I find bankruptcy lawyers.

If you'd like to see what I'm writing over there, please feel free to do so at this link.

It's a different audience over at Above the Law - an audience made of people that has never had to explain that while, yes, technically, the judge could give you probation in light of Booker, it doesn't mean that the judge is going to vary 13 years downward to do it.

The Above the Law readers are people who don't know what Corrlinks is.

They're people who have never walked out of a courthouse carrying a garbage bag containing their client's wallet, belt, and keys after a surprisingly bad hearing to review conditions of pretrial release.

But I'm sure they're fine people nonetheless. Except for the people who write stuff in the comments - I assume they're deeply unhappy third-year associates drowning in law school debt, document review, and Dewar's.

In any event, I wanted to let you know, gentle readers, that you're my people too. And posts will continue to be posted here with about the same frequency that they have been.

Thanks very much for reading. Hope you're well,


June 5, 2012

The Fourth Circuit Holds That Money Laundering Only Applies To The Profits Of A Crime, Not The Expenses

William Cloud believed in the American dream of home ownership. He worked to make buying a home easy for people in his community.

He wanted to make buying a house easy, even if it would be the second or third house that a person would own.

1389529_house.jpgTo make sure the houses he was helping people buy were up to snuff, he'd buy them first and do some work on them. He'd then sell them - or, using the government's language - he'd "flip" them to the people he was helping to become real estate investors.

He made money on each sale, because, of course, a man has to eat. And he didn't disclose these payments to himself because it didn't want to cloud his good works with the ugly taint of money.

Also, he knew that people could buy more houses if their credit was good. So, he'd work with people to purchase a number of houses quickly, so that they only had to use the one credit report for the series of mortgages. That way, the first house wouldn't show up on the credit report for the second or third house.

Unfortunately, like so many of us in this modern life, Mr. Cloud spread himself too thin. He was available to help folks get into the houses, but wasn't able to make the time to help his neighbors pay their mortgages.

Many of the homes were foreclosed on.

The government, immune to the pull of Mr. Cloud's good works, indicted him for mortgage fraud and money laundering.

Mortgage fraud, because Mr. Cloud told a number of people to make false statements on mortgage applications and also, uh, helped them make those false statements.

Money laundering because Mr. Cloud paid a number of people to help him with this home ownership vision - he paid people to find others to buy houses and facilitate real estate closings.

A jury convicted Mr. Cloud.

In United States v. Cloud, the Fourth Circuit reversed his money laundering conviction.

Money laundering is, generally, when a person take the profits from a crime and cleans them up by transferring the money.

However, the money has be profits from a crime. As the Supreme Court explained in United States v. Santos [FN1]:

Few crimes are entirely free of cost, and costs are not always paid in advance. Anyone who pays for the costs of a crime with its proceeds--for example, the felon who uses the stolen money to pay for the rented getaway car--would violate the money laundering statute. And any wealth-acquiring crime with multiple participants would become money laundering when the initial recipient of the wealth gives his confederates their shares. Generally speaking, any specified unlawful activity, an episode of which includes transactions which are not elements of the offense and in which a participant passes receipts on to someone else, would merge with money laundering.

And, of course, if money laundering merges with the underlying crime a person can't be convicted of both offenses without violating double jeopardy.

So - if a person is prosecuted for a substantive offense, that person can't be charged with money laundering for transferring expenses associated with that offense.

Or, as the Fourth Circuit explained,

Cloud's money laundering convictions are based on payments to recruiters, buyers, and other coconspirators for the role each person played in the mortgage fraud scheme. Cloud's mortgage fraud depended on the help of others, and their help, in turn, depended on payments from Cloud. Such payments are no different than "the felon who uses the stolen money to pay for the rented getaway car" or "the initial recipient of the wealth" in "any wealth-acquiring crime with multiple participants . . . [who] gives his confederates their shares." Santos, 553 U.S. at 516 (plurality opinion). Because Cloud's money laundering convictions on Counts 28-33 were based on paying the "essential expenses" of his underlying fraud, we find a merger problem.

Mr. Cloud's money laundering convictions were then vacated.

The Fourth Circuit also reversed an order that Mr. Cloud had to pay the costs of his court-appointed attorney's time.

The case was sent back for resentencing.

[FN1] - Strictly speaking this was just Justice Scalia writing for a plurality. But it's really good language.

See also:

Paying For Drugs Is Not Money Laundering