Federal Trial Issues

Published on: August 16, 2012

Delay in filing an indictment caused by plea negotiations is not excludable time without a specific court order stating that the ends of justice served by the delay outweigh the best interests of the public and the defendant in a speedy trial

Charges were brought against the defendant in U.S. v. Mathurin for various armed robberies in Miami-County, but he was initially charged by information as a juvenile under the Juvenile Justice and Delinquency Act. After the defendant waived his rights not to be prosecuted as an adult, the defendant and the government began plea negotiations, starting about August 27, 2009. There was dispute as to when plea negotiations actually ended, but the defendant was indicted in federal court in Miami on December 29, 2009. The charges in the indictment were identical to the charges in the juvenile information under which he had been held in custody. Eventually, the defendant went to trial and was convicted of various counts and sentenced to 492 months.

Under the Speedy Trial Act the government is required to file an indictment against the defendant within 30 days from the date of arrest. The act provides for excludable time for delay resulting from “proceedings concerning the defendant,” including periods of delays from specific enumerated categories of proceedings. One of those categories of delay includes a “delay resulting from consideration by the court of a proposed plea agreement to be entered into by the defendant and the government.” 18 U.S.C. §3161(h)(1)(G). The remedy for a violation of the 30-day time limitation is dismissal of the complaint.

The 11th Circuit found the 30 day clock began to run when the defendant gave his consent to be prosecuted as an adult on August 27, 2010. The government argued that the time period from August 27, 2009, through December 22, 2009, (the date of a status conference on an the plea negotiations), was all excludable time. The 11th Circuit disagreed and concluded it was not excludable time because the district court was never asked to review a proposed plea agreement during this interim period. A delay resulting from plea discussions between the government and the defendant is not automatically excludable as “proceedings concerning the defendant.” For the delay to be excludable, the procedure under the Speedy Trial Act requires the district court to approve the delay by a finding that the “ends of justice served by taking such a delay outweigh the best interest of the public and the defendant in a speedy trial.” 3161(h)(7)(A). While the parties may delay the filing of an indictment as long as they want, without a court order containing this language, the Speedy Trial Act is not waived. Plea negotiations do not fall under the category of events that automatically exclude delay. The 11th Circuit held that the indictment had to be dismissed because it was filed beyond the 30 day time limitation and the delay for plea negotiations was not automatically excludable time. Whether the dismissal will be with or without prejudice would be left for the district court to decide on remand. The 11th Circuit did not address this issue.

Published on: August 12, 2012

Tolling of the Statute of Limitations upheld under 18 U.S.C. § 3292, which allows for its suspension while the government makes an official request to a foreign country for evidence the government reasonably believes can be found in the foreign country

by The Swartz Law Firm

In U.S. v. Broughton, the defendants were charged in one count with conspiracy to commit mail fraud, wire fraud, and insurance fraud and in a second count with money laundering. The fraud conspiracy was a scheme to create fraudulent capitalization for insurance companies. State and federal law requires that companies offering insurance or credit backing on behalf of other companies in the United States must be licensed. To be licensed, a company must show it has sufficient capital to meet the insuree’s obligations and that it possesses sufficient capital reserves in the event of future claims. The capital requirements include Treasury Notes, Certificates of Deposits, stocks, and bonds but this capital can only be claimed as an asset on an insurance company’s financial statement if it is owned and controlled by the company claiming the assets. Beginning around 1996 the I.R.S. launched an insurance fraud investigation that looked at companies/people that “rented” assets that others owned to include in their own balance sheet as assets. The investigation focused on individuals and companies that marketed themselves as insurance providers on the basis of rented assets. Evidently, these fraudulent companies would collect insurance proceeds without intending to pay out any claims.

The I.R.S. investigation led to meeting between a co-conspirator and an I.R.S. agent posing as a businessman looking for assets to start an insurance company. Over time, the defendants described how they market their fraudulent shell company with its “unqualified audit opinion” and they provide the appearance of nonexistent Treasury Notes and CDs as rented assets. The conspirators described how to structure the insurance company with subsidiary companies holding the fraudulent rented assets. The undercover agents agreed to rent $10 million in assets to capitalize their insurance company and made cash payments in exchange.

The defendants moved to dismiss the indictment returned January 17, 2006, on statute of limitations grounds arguing that the statute was improperly suspended under 18 U.S.C. § 3292. This provision allows the district court to suspend the running of the statute of limitations if, prior to filing the indictment, the government makes an official request to a foreign country or court for evidence that reasonably appears to be located in the country to which the request was made. The defendants argued the government failed to satisfy these requirements for the following reasons:

Published on: July 11, 2012

Amendment 750 to the crack cocaine guidelines did not apply to a defendant whose original guidelines sentence was the statutory minimum sentence

by The Swartz Law Firm

In U.S. v. Glover the defendant moved to reduce his sentence under 18 U.S.C. §3582(c)(2) based on a retroactive amendment to the sentencing guidelines that lowered base offense levels for certain crack cocaine crimes. Glover pled guilty to 50 grams or more of crack cocaine violation 18 U.S.C. §841, but his relevant conduct involved two kilograms of crack cocaine. With his criminal history category of II, his guideline range would normally have been 188 to 235 months, except that he faced a mandatory life sentence under the sentencing enhancement provision of 21 U.S.C. §841(b)(1)(A) because he had at least two prior convictions for felony drug offenses. For this reason the statutory mandatory life sentence became his guideline sentence. The PSI recommended life and the sentencing judge adopted this recommendation. However, the government filed a §5K1.1 motion based on his substantial assistance to the government and the district court departed downward from the life sentence reducing his sentence to 208 months.

Amendment 750 lowered the crack cocaine penalties. The Sentencing Commission also made the amendment retroactive. In Glover’s case, the two kilogram quantity dropped from level 38 to 34. This would have given Glover an offense level 31 and a range of 121 to 151 for his criminal history category of II. Like many federal criminal lawyers in Miami that have applied for sentence reductions under this amendment, so did Glover. Unfortunately for Glover, the 11th Circuit held that §3582 does not allow for a reduction in his case. While the amendment normally applies where a sentencing range has been subsequently lowered by the Commission, the original guidelines were dictated by the statutory minimum. The amendment only applies if the amended guideline range is not affected by the operation of another other statute or guidelines. Here, Glover’s original guideline sentence was the statutory minimum of life, according to section 841(b)(1)(A). The statutory minimum was not affected by the Amendment.

The 11th Circuit held that the statute does not permit the defendant to receive a lower sentence than any sentence he would have receive if the amendment had been in effect at the time of his sentencing. The goal is to treat a defendant sentenced before the amendment the same as those sentenced after the amendment. Therefore, because the original sentence was based on a mandatory minimum sentence, the court lacks jurisdiction to consider a 3582(c)(2) motion even when an amendment would lower an otherwise applicable guidelines sentence.

Published on: July 2, 2012

Conviction for inducing a girl under 18 years of age into prostitution does not require proof the defendant knew she was underage

by The Swartz Law Firm

In U.S. v. Daniels the 11th Circuit took up the issue of whether a conviction under 18 U.S.C. 2422(b) requires the government to prove that the defendant knew the victim was a minor. The statute makes it a crime for someone to use any interstate of foreign commerce to knowingly induce, entice, or coerce any individual who has not reached the age of 18 to engage in prostitution or any illegal sexual activity. Daniel was charge with persuading, inducing, enticing, or coercing a girl under the age of 18 to engage in prostitution in violation of section 2422(b) and with knowingly transporting the girl across state lines to engage in prostitution. Daniels, a pimp, drove to Miami with a woman named Head, to engage in prostitution. After arriving in Miami they met a girl (A.W.) on the street who was then 14 years old. They convince her to work as a prostitute for Daniels. Head explained the details of working for Daniels what to charge for certain services how to act with a trick. There was no mention about her age. When trouble began between the two prostitutes, Daniels decided to sell A.W. to another pimp for $200. He took her to a bus station in Miami where she boarded a bus bound for Memphis, Tennessee, where she worked truck stops for the pimp who bought her.

Sending A.W. to another pimp was enough proof Daniels induced her.

Daniels’ federal criminal defense attorney argued the evidence was insufficient to convict of a violation of 18 U.S.C. § 2422 because no reasonable jury could have found that he persuaded induced enticed or coerced A.W. to engage in prostitution because she was already a prostitute in Miami. The fact that she was already working as a prostitute when she came to work for him is not sufficient evidence to conclude that he persuaded her to be a prostitute. The 11th Circuit found that Daniel’s actions in arranging to sell her to another pimp and putting her on a bus so she could reach him falls within the definition of induce.

Published on: June 29, 2012

Reverse sting drug conspiracy conviction upheld but conviction for possession of an obliterated serial number firearm reversed for lack of proof the defendant knew it was obliterated

by The Swartz Law Firm

In U.S. v. Haile defendants Haile and Beckford were convicted of conspiracy to distribute more than five kilograms of cocaine, possession of five firearms, including a machine gun, in furtherance of a drug-trafficking offense, possession of an unregistered machine gun, and with possession of a firearm with obliterated serial number. The charges arose out of a reverse-sting operation where a Drug Enforcement Agent posing as a marijuana supplier met with Beckford who the undercover agent believed was looking to purchase marijuana. They discussed delivering 1,000 pounds to Beckford. The agent introduced Beckford to another undercover agent posing as a gun seller, and they discussed exchanging guns for marijuana. After the marijuana was delivered, the defendants were arrested. Haile had a Glock pistol. Beckford had cash, a loaded handgun, two rifles with obliterated serial numbers, and an M-11 machine gun.

The defendants’ lawyers challenged the conviction for knowing possession of a firearm in furtherance of a drug trafficking crime, claiming the indictment conflated the two elements of 18 U.S.C. § 924(c) that trigger the statute’s application. This is a penalty that federal criminal defense lawyers in Miami and across the county commonly face. The enhance penalty of statute is triggered two ways: (1) during and in relation to any crime of violence or drug trafficking crime…uses or carries a firearm, or (2) who in furtherance of any such crime, possesses a firearm. Both of these clauses were written in the indictment and defendants claimed that by conflating the elements it violated their 6th Amendment right to be informed of the nature of the accusations against them. The 11th Circuit rejected this claim, finding the indictment referred to the correct statute and place the defendants on notice of the two elements that trigger the enhancement.

Jury instruction for machine gun possession was correct.

Published on: June 29, 2012

Conviction for violating U.S. embargo against selling Communist Chinese made ammunition to the U.S. Army upheld

by The Swartz Law Firm

In U.S. v. Merrill, the defendant was convicted in federal court in Miami of the federal crime of knowingly selling ammunition made by a Communist Chinese military company to the U.S. Army. Here are the facts. AEY, a munitions dealership based in Miami Beach, Florida, placed a bid with U.S. Army for a contract to supply the Afghanistan Security Forces with various types of military munitions including 500 million rounds of AK-47 ammunition. The contract called for AEY to supply certain ammunition to the Afghan National Police and the Afghan National Army over a two year period. As an investor in AEY, Merrill advised AEY how to prepare the bid, and used his contacts in the arms business to find prices for ammunition. When the army requested details about the financial viability of AEY, Merrill provided letters from two of his companies promising a loan of $36 million to support the contract. Merrill and codefendant agreed to split the profits. Their bid price of $298 million was accepted by the U.S. Army. AEY acquired its munitions from a munitions supplied called MEICO located in Albania. When one of the AEY representatives went to Albania to oversee shipping, he discovered Chinese characters on the wooden crates containing the ammunition and contacted the other principles of AEY. One of the coconspirators sent an email to the Directorate of Defense Trade Controls Response Team at the State Department asking about the legality of brokering Chinese ammunition to the Army if it had been sitting for about 20 years with a company in Albania that acquired it before the U.S. enacted the arms embargo against China purchasing military equipment manufactured by the Communist Chinese military companies. The response given by the State Department was that the transaction could not be authorized. The coconspirators went ahead with it anyway by removing the Chinese characters form the crates and packaging. As the ammunition was shipped, the coconspirators sent about 30 certificates of conformance containing false statements that MEICO was the manufacturer of the ammunition and not the Communist Chinese military company that actually made it. Merrill was charged federal crimes of making false statements to the Army; defrauding the Army by making false statements, wire fraud against the Army, and defrauding the government in the procurement of property.

1. The court rejected Merrill’s motion to dismiss indictment.

Merrill challenged the indictment on the grounds that MEICO had acquired the ammunition from Communist China forty years before AEY acquired it from MEICO. It also argued that AEY had no contract with the Chinese military company. The 11th Circuit held that the charges were valid, finding that the ban on any sales of ammunition made by Communist Chinese military company does not include any exception for munitions that left China before the regulation was enacted. Merrill’s interpretation would leave a “gaping” loophole that the Department of Defense could not have intended.

Published on: June 25, 2012

Federal courts have jurisdiction over a MARPOL violation on a ship found in a U.S. port flying a foreign flag

by The Swartz Law Firm

In U.S. v Pena the defendant was charged with a federal crime of conspiracy to knowingly fail to maintain an accurate oil record book on board the vessel, in violation of 33 U.S.C. §1908; for failing to conduct a complete survey of the vessel Island Express in violation of 33 U.S.C. 1908; and for making a materially false statement to the Coast Guard, in violation of 18 U.S.C. 1001. Under an multinational maritime treaty called MARPOL, these federal criminal statutes were enacted to prohibit ships from dumping bilge water into the ocean unless the oil content has been reduced to less than 15 parts per million. The law required a ships over 400 tons to have a functional oily water separator to filter bilge water before discharging it. If the water is not filtered through a separator, then it must me collected and retained in tanks and discharged at a proper facility on shore.

The Coast Guard conducted an inspection of the Island Express, docked in Ft. Lauderdale, Florida, and examined the certificate of compliance which showed that the ship was properly outfitted with a functioning oily water separator to filter bilge water and reduce its oily content before discharging it into the ocean. A surveyor is the person who is qualified to inspect and issue the certificate of compliance. Hugo Pena was the surveyor who issued a Certificate for the Island Express stating that he inspected the vessel and that it was in compliance with the statute. The Coast Guard discovered that the oily water separator did not operate, and the ship did not had a bilge holding tank for storing bilge water for later discharge.

Pena challenged the Miami federal court’s jurisdiction over a MARPOL violation on a ship flying a foreign flag. The Island Express was registered in Panama. The 11th Circuit held that relevant statutes do give the federal courts jurisdiction over violations of MARPOL committed on foreign flagged ships in U.S ports and Congress has not surrendered jurisdiction to the flagged ship.

Published on: June 14, 2012

The 11th Circuit disapproved a modified jury instruction on constructive possession but found that overall the jury was not misled

by The Swartz Law Firm

In U.S. v. Cochran the issue before the jury was whether drugs and drug related materials inside of a house belonged to a defendant or someone else who could have had access to the house. Though this happened in the Middle District of Florida, it is a common issue seen in federal drug cases in Miami as well. To prove the case the government offered a modification to the constructive possession jury instruction given in a drug possession case. The 11th Circuit disapproved of the modification; however it did not amount to reversible error. The facts leading to the Defendants arrest are this.

1. Agents executed a search warrant at house where they suspected he was staying.

2. Inside they found a small quantity of cocaine and a digital scale drugs along with forks and a measuring cup bearing drug residue in various parts of the house.

Published on: June 11, 2012

New charges for alien smuggling filed after the Defendant’s acquittal for drug trafficking were not subject to dismissal as vindictive

by The Swartz Law Firm

In Kendrick’s first trial where he faced federal charges of trafficking in marijuana and possession of a firearm he was acquitted. Shortly after his acquittal, he was indicted for the charge of smuggling an alien into the U.S. for purpose of financial gain 8 U.S.C. 1324(a)(2)(B)(ii). The Defendant claimed his prosecution for alien smuggling was based purely on prosecution vindictiveness for his beating the government at the drug and gun charges and the defendant moved to dismiss the indictment. In U.S. v. Kendrick, the 11th Circuit found no basis for prosecution vindictiveness and refused to dismiss the indictment. This is what happened.

1. The Coast Guard boarded a vessel that Kendrick was piloting off the coast of Florida and discovered 900 pounds of marijuana, a firearm and a previously deported illegal alien. Initially he was only charged with drug smuggling and firearm possession.

2. At his trial he denied knowing about the marijuana but admitted he had gone to the Bahamas to bring back illegal aliens into the U.S. for $25,000. He claims he called off the alien smuggling plan when he found they had no passports. He then backtracked from this admission and claimed he was only going there to bring back legal aliens and that was his financial motive.

Published on: May 2, 2012

Padilla v. Kentucky is not retroactive for postconviction habeas relief

by The Swartz Law Firm

Deportation is always a common problem for alien criminal defendants in Miami and other parts of Florida who a convicted of a crime. In U.S. v. Figueroa-Sanchez, the 11th Circuit faced two issues: 1) whether the district court properly denied defendant’s 2255 motion for federal habeas post-conviction relief as successive, and 2) whether Padilla v. Kentucky, 130 S.Ct. 1473 (2010) announced a retroactively new rule of law. Deportation is always a problem for an alien defendant convicted of a crime. The Supreme Court’s decision in Padilla v. Kentucky offered habeas relief to defendants who were not advised of the deportation consequence prior to entering a plea. Figueroa-Sanchez was a citizen of the Dominican Republic who lived in the U.S. since 1972. After his drug trafficking conviction in April of 2004, he faced deportation. In July of 2008, he filed a pro se motion to vacate judgment pursuant to Rule 60(b) Federal Rules of Civil Procedure. The district court treated this motion as a §2255 motion, and then denied it as time barred because it was filed over one year after the judgment became final in 2004. Two years later, he filed a 2255 motion to vacate his conviction based on Padilla because his counsel failed to inform him of the risk of deportation before pleading guilty. The district court dismissed for lack of jurisdiction, noting that it had construed the July 2008 motion as a 2255 motion, and therefore the Padilla motion to vacate was successive.

The 11th Circuit decided it was not successive because the district court failed to give the defendant the warnings required by Castro v. United States 124 S.Ct. 786 (2003) when it recharacterized the defendant’s Rule 60(b) motion. Castro held that a district court must take the following steps to assure that the defendant is aware the motion is being recharacterized as a 2255 motion: 1) advise the litigant of the recharacterization; 2) warn the litigant he will be restricted in any subsequent 2255 motions, and 3) give the litigant an opportunity to withdraw the motion. Because the district court did not follow Castro, the 11th Circuit held that this motion could not be dismissed as successive.

Unfortunately for Figuero, the 11th Circuit held that Padilla could not retroactively apply as a basis for the defendant to vacate his conviction. Section 2255 grants an additional one year for petitioners to file a 2255 motion from the date on which the right asserted was initially recognized by the Supreme Court so long as the decision is retroactively applicable to cases on collateral review. The 11th Circuit held that Padilla was not retroactive. Though Padilla announced a new rule of constitutional law, it did not announce a watershed rule of criminal procedure nor did it alter any bedrock of criminal proceedings. Even if a defendant demonstrates constitutionally deficient representation under Padilla, a petitioner must still prove prejudice under Strickland v. Washington. “In order to show prejudice, a petitioner must show that there is a reasonable probability that, but for counsel’s errors, he would not have pleaded guilty and would have insisted on going to trial.” The 11th Circuit found Figueroa-Sanchez cannot show prejudice required by Strickland.