US v. Torlai, No. 11-10359 (8-26-13)(Bybee with Wallace and Farris).

The loss calculations in a Federal Crop Insurance Act were affirmed. Fraud is fraud. As such, he was not entitled to set offs between legitimate and illegitimate claims.

US v. Hilger, No. 12-30192 (8-26-13)(McKeown with Ikuta and Carney, D.J.).

In affirming a supervised release violation, the 9th holds that a defendant's uncorroborated confession suffices. The Opper rule, which requires some other corroboration, only applies to guilt beyond a reasonable doubt. SR has a much lower standard of proof.



US v. Swor, No. 12-30250 (8-27-13)(per curiam with Kozinski, Berzon and Hurwitz). 

A fraudster introduces investor to another fraudster:  does the first fraudster owe restitution when the investors are bilked?  No, said the 9th, because the introduction was not part of the fraudulent scheme.  The first fraud involved a group of investors, the defendant, and a co-defendant.  The defendant introduced other investors to the co-defendant, who, after the defendant ended his fraud, continued to defraud the investors in a separate scheme.  The court could not order the defendant to pay restitution to the second group.

US v. Evans, No. 11-30367 (8-27-13)(Paez with Fisher; dissent by Gould). 

FRE 104 concerns preliminary issues of witness qualifications, privilege existence, or admissibility.  The question here is whether 104 serves as a gatekeeper function, whereby a judge can determine whether evidence is fraudulent or genuine or whether 104 allows the determination subject to another substantive provision outside of 104.  The case here involved a delayed birth certificate issued by Idaho in a 1326 case and a separate fraudulent documents case.  In each case, the delayed birth certificate was key to the defense that he was indeed a US citizen.  The district court held a pretrial hearing, where three government witnesses cast doubt on the delayed birth certificate.  The court concluded it was procured by fraud.  The 9th, on appeal, vacated and remanded.  The district court could not use FRE 104 by itself to preclude; it had to use another substantive provision.  To allow a court to act as an "umbrella" gatekeeper in this fashion would mean the court weighs and judges the evidence as a gatekeeper independent of other provisions.  The evidence in this case revolved around the delayed birth certificate.  The 9th, mindful of the due process concerns too, said the evidence must be allowed, and that FRE 403 would not bar.  Gould, dissenting, argues that the court has to have the authority to assess the genuineness of evidence, independent of weighing.  He would also find that any error was harmless.

Case o' The Week: It Pays to Discover - Sedaghaty and Brady Violations

  An embarrassing Brady violation in a high profile and expensive

federal prosecution in the Pacific Northwest will surely send the message, and finally put DOJ on the path of real discovery reform.

   So we said after Ted Stevens.

  Déjà vu all over again. United States v. Pirouz Sedaghaty, 2013 WL 4490922 (9th Cir. Aug. 23, 2013), decision available here.

Players: Decision by Judge McKeown, joined by Judge Schroeder. Dissent by Judge Tallman. Big win by D. Oregon FPD Steven Wax.

Facts: The defendant, known as Pete Seda, lived in Ashland and was active in causes promoting the understanding of Islam. Id. Seda was the secretary of the U.S. branch of a Saudi aid organization, Al-Haramain. Id. at *3. The government suspected that Al-Haramain also funded mujahideen fighters in Chechnya. Id. at *3. At one point, foreign funds were put in Al-Haramain’s account in Ashland, an Al-Haramain officer came to the US, went to an Ashland bank with Seda, and together the officer and Seda withdrew over $140,000 in cashier’s checks. Id. The government argued those funds later went to the mujahideen. Id. at *4. Later, this same officer returned to Ashland and used $300,000 in travelers checks for the purchase of a prayer house. Id.  

  In 2001, Seda signed an IRS Form 990 – required for tax exempt organizations – that inaccurately reported some of the above transactions. Id. Seda was indicted for, among other things, filing a False Form 990. Id. 

  “The central issue at trial was whether the errors on the Form 990 were willful.” Id. at *5. The government characterized one witness, “Barbara Cabral,” as “critical” to its efforts to prove willfulness. Cabral’s was the only direct testimony linking Seda to efforts to fund the mujahideen. Id. at *8. 

  Seda was convicted at trial, and then the government revealed “a significant amount of evidence relating to” witness Cabral. Id. This undisclosed evidence included payments to Cabral’s husband, an offer of payment to Cabral herself shortly before trial, and undisclosed reports, draft reports, and interview notes. Id. 

  The district court found a discovery violation, but held it was not material to the conviction. Id.

Issue(s): “[T]he government concedes . . . that the withheld information is favorable to Seda and that it should have been turned over before trial. Our Brady analysis therefore hinges on materiality.” Id. at *9.

Held: “Viewing the suppressed evidence holistically in light of the other evidence, the withheld evidence undermines confidence in the outcome of the trial. . . . We conclude that Cabral's testimony was important enough that a changed perception of her credibility creates a reasonable probability of a different verdict. . . .  In light of the importance of allowing a full and fair cross examination of government witnesses whose testimony is important to the outcome of the case, Seda has established a Brady violation that merits a new trial.” Id. at *12 (internal quotations and citations omitted).  

Of Note: Here are some Sedaghty points gleaned for your next Brady argument.

• Materiality is evaluated “in terms of the suppressed evidence considered collectively, not item by item.” Id. at *9. 

• “Payments to a government witness are no small thing.” Id. at *10.

• The “uncertain nature” of an informal payment promise is particularly material, because it creates a greater incentive to please the promisor. Id.

• Exclusion of other impeachment evidence can increase the materiality of non-disclosed Brady material. Id. at *11.

How to Use: Sedaghty is a long opinion brimming good defense holdings. One important Fourth challenge relates to the overbreadth of computer searches. Judge McKeown asks, “May a broad ranging probable cause affidavit serve to expand the express limitations imposed by a magistrate in issuing the warrant itself?” Id. at *22. The Ninth’s view is clear: “We believe the answer is no. The affidavit as a whole cannot trump a limited warrant.” Id. . . . “We have never held that an affidavit could expand the scope of a legitimate warrant beyond its express limitations nor do we do so here.” Id. It’s a new Ninth rule, and a great one at that – a welcome addition to the line of Fourth Amendment law on overbroad computer searches.

                                               

For Further Reading: In an important development, A.G. Holder has warned in an editorial that the impact of sequestration on indigent defense undermines the right to a fair trial. See editorial here.

“Hello, my name is Brady” image from https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjq_IthaW4kdNZ3c2GshQq5GgLkHISqxU2tm81l_HbwNXhf0-BnAX57ohsLcdvgOwIzk_pq7gMQ6k1H1zZjUaR1Uu1gDjz4VNp602Q_qFsqFSjWIAbOFnJGs6SYi9e7vZ2qO-jTwQ/s320/hello-my-name-is-brady.jpg

Steven Kalar, Federal Public Defender N.D. Cal. Website at www.ndcalfpd.org

US v. Sedaghaty, No. 11-30342 (8-23-13)(McKeown with Schroeder; partial concurrence/dissent by Tallman).

This was a tax fraud case that was transformed into a terrorism case. Charitable contributions supposedly for a mosque in Missouri were allegedly were sent to terrorists in Chechnya. The 9th reversed and remanded for a new trial, and to see if evidence should be suppressed, based upon Brady violations, and a search outside the contours of the warrant. The case, and trial, was played out with evidence deemed classified. This lead to summaries, slanted according to the 9th, being used; and Brady material on a key witness being withheld. The Brady withholding was especially troubling, and caused a remand, as well as the computer search that ranged far afield beyond the warrant. Dissenting from the reversal and remand, Tallman argued that the 9th viewed the evidence from the vantage of the defendant, while a more neutral view revealed DOJ and the gov't taking extraordinary measures to disclose. The text of the search warrant is unduly restricted in the majority's reading.

Congrats to Steve Wax, FPD for Oregon.

US v. Cohen, No. 12-10240 (8-22-13)(Christen with Fletcher and Gould).


The 9th affirms the district court's applying to defendant a sentencing adjustment for misrepresenting that he was acting for a charitable organization even when his acts are not on behalf of a charity, but supposedly would benefit a charity. Here, the defendant had a scheme that promised great returns, the skyrocketing values of which could be used for the charity. He posed as a wealthy philanthropist, but instead of donating to the charity, he gave its donors the "opportunity" to invest in his company's shares at a below market cost and to reap the benefits. The benefits were not reaped, and losses followed. This offer was akin to misrepresenting a charitable donation.



US v. Reed, No. 12-10420 (8-22-13)(Anello, D.J., with O'Scannlain and M. Smith).

This is an Assimilated Crimes Act case. It arises from a driving under the influence in the Lake Mead National Recreation Area. The 9th held that Nevada's per se drugged driving law is assimilated and can be used for charging and conviction, because the federal CFR does not have a per se drugged component.

Case o' The Week: The Ninth Gets Cable, Too -- Ermoian and Obstruction of Justice

“The facts of this case read like an episode of the fictional television

drama Sons of Anarchy.” United States v. Ermoian, 2013 WL 4082072 (9th Cir. Aug. 14, 2013), *1, decision available here.

A great teaser opening, for a great Ninth decision.

Players: Decision by Judge O’Scannlain, joined by Judges Goodwin and N.R. Smith. Big win by former ED Cal AFPD John Balazs and others.

Facts: Federally-funded cops were investigating a motorcycle shop with suspected Hells Angel affiliations. Id. at *1. The cops suspected internal leaks, so they released a watered-down bulletin about some surveillance. Id. David Johnson – a Deputy Sheriff and bailiff – took the bait, and called Gary Ermoian – a private investigator. Deputy Johnson warned Ermoian that he had seen some of the surveillance photos and told Ermoian to advice a target to “watch his back.” Id. Wiretaps then picked up a “flurry of activity” as the various targets were warned of and reacted to the tip. Id. Ultimately, twelve defendants were indicted for RICO and other offenses. Id. at *3. Johnson and Ermoian were indicted on charges of conspiracy to obstruct justice, in violation of 18 USC § 1512(c)(2). At every opportunity before and during the trial Johnson and Ermoian objected that the FBI investigation did not qualify as an “official proceeding” under the obstruction statute. Id. Those challenges were denied, the jury convicted, and the defendants appealed.

Issue(s): “We must decide whether an FBI investigation qualifies as an ‘official proceeding’ under a federal statute criminalizing obstruction of justice.” Id. at *1. The defendants “primarily focus on one issue: Did the district court err when it determined that an FBI investigation qualifies as an ‘official proceeding’ under the statute criminalizing obstruction of justice?” Id. at *3.

Held: “[I]n light of the plain meaning of the term ‘proceeding,’ its use in the grammatical context of the ‘official proceeding’ definition, and the broader statutory context, we conclude that a criminal investigation is not an ‘official proceeding’ under the obstruction of justice statute.” Id. at *7.

Of Note: In a case of first impression, Judge O’Scannlain brings the Ninth onto the right side of a circuit split. Id. at *6-*7 (rejecting Second Circuit analysis as unpersuasive, and adopting the approach of the Fifth Circuit). Will the Supremes resolve this split? If so, Justice Scalia will hopefully note Judge O’Scannlain’s shout-out for Reading Law: The Interpretation of Legal Texts. Justice Scalia’s book, explains the Ninth, “aptly explains” the principle of statutory interpretation used to get to the result in Ermoian. Id. at *5. Like Justice Scalia, Judge O’Scannlain isn’t too keen on the Congressional record: because the meaning of the statute is “plain and unambiguous” he “decline[s] the Government’s invitation to consult the statute’s legislative history.” Id. at *7 & n.6; id. at *6 (rejecting Second Circuit’s reliance on Congressional “purpose”).  

How to Use: Ermoian is an interesting statutory construction case, because the word at issue in the obstruction statute – “proceeding” – has both a lay definition and a legal definition. Id. at *4. The lay definition is broad enough to encompass an “investigation” (which would have meant a government win), but Judge O’Scannlain holds that the more-narrow legal definition controls because of the context of the word in the statute. Id. at *5. Add Ermoian to the arsenal of statutory interpretation cases for the proposition that a common lay definition may not necessarily carry the interpretative day.

                                               

For Further Reading:  It was a most-eventful week, for CJA funding. 

   CJA Lawyer Rep Rob Ruth has posted on his blog a recent email of Judge Catherine Blake, Chair of the Defender Services Committee of the Judicial Conference. See blog here. In her email Judge Blake describes last week’s decision of the Executive Committee, including a $15 per hour cut to the CJA rate and four weeks deferral of CJA payments in Fiscal 2014. 

  For a thoughtful overview of the impact of this decision for both siblings in the CJA family, see a Tampa Tribune article here.

“Sons of Anarchy” poster from http://all-things-andy-gavin.com/wp-content/uploads/2012/10/Sons_of_Anarchy_Poster.jpg

Steven Kalar, Federal Public Defender ND Cal. Website at www.ndcalfpd.org

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Griffin v. Harrington, No. 12-57162 (8-16-13)(Trott with Lucero and Fletcher).

"I swear....." the witness states when he takes the oath. But what if he refuses to take the oath? This occurred in a state murder trial, where the only eyewitness who identified the petitioner as the shooter recanted, and then refused to take the oath when called by the State (who impeached with a recorded statement). The defense counsel failed to object. The unsworn statement came in, the impeachment took place, and the cross examine was two questions. The state affirmed the conviction on appeal, and then in state post-conviction, found no IAC because of tactical (!?) reasons. The district court granted habeas relief, and the 9th affirmed. It found the state court's reliance on Supreme Court cases unreasonable. There was no tactical advantage to be gained.

US v. Edwards, No. 12-10204 (8-15-13)(Schroeder with Ripple and Callahan).

The 9th vacated and remanded a sentence. The 9th held that Nevada's attempted burglary was not a categorical crime of violence, and since the statute was not divisible, a modified categorical approach was not available under Deschamps.

US v. Grant, No. 12-50209 (8-15-13)(N. Smith with Gould and Du, D.J.).

Sending a letter to the court, with your new address in the block, is not the same as informing your probation officer of your change in address. The probationer here changed addresses, and failed to inform her probation officer. The letter she had sent to the court asking for early termination, with a new address, did not act as informing her probation officer. The fact she also subsequently picked up a state conviction didn't help. The 9th affirmed the violation and sentence.

US v. Moschella, No. 11-50377 (8-14-13)(Zipps, D.J., with Berzon and Ikuta). 

The defendant pled guilty to fraud counts.  The plea agreement had the government recommending the low end of the Guidelines range; the defendant being able to argue for a departure or variance downward, which the government could oppose;  and an agreement on restitution.  The defendant, at sentencing argued for a variance downward.  The government did not tacitly breach a plea agreement in arguing against defendant's variance.  The government recommended the low end, and its arguments against a lower sentence due to the harm and motivation (greed) of the defendant were consistent with the terms.  The court did vary, but upward.  This was in permissible.  Because  it was a variance, the court did not have to give notice.  Lastly, the court could order restitution for two newly found victims of the fraud.

US v. Ermoian, No. 11-10124 (8-14-13)(O'Scannlain with Goodwin and N. Smith).

Word leaked out about an ongoing FBI investigation of the Hell's Angels motorcycle club attempts to establish a chapter in Modesto, California.  The leaks were traced to the defendant, and he was charged and convicted of obstruction of justice under 18 U.S.C. § 1512.  The 9th held that the obstruction was during an investigation, and not during an "official proceeding." Thus, it falls outside the scope of the statute.  An official proceeding has to be a convened action or hearing or  determination, and not an investigation.  Congress limited the reach.

US v. Acosta-Chavez, No. 12-10324 (8-14-13)(Wood, Sr. D.J., with Tashima and Bybee).

Another "categorical" decision in a 1326 case. In sentencing on a 1326 conviction, the defendant had a prior Illinois conviction which was found by the court to be an aggravated felony. The 9th held that the Illinois statute defining minor in a forcible sex offense (here in a range of 13 to 17 years old) was broader than the minor definition in the generic federal statute. It is also not divisible, and therefore not open to a modified categorical approach. See Deschamps, 133 S. Ct. 2276 (2013).

Congrats to CJA counsel David Basham of the Tucson panel.

Case o' The Week: No Appetite in Ninth for Underwood -- Probable Cause and Leon Good Faith

 

The devil’s in the details (or lack thereof), when law enforcement cuts and pastes facts into search warrant affidavits. United States v. Underwood, 2013 WL 3988675 (9th Cir. Aug. 6, 2013), decision available here.

Players: Decision by Judge Pregerson, joined by Judges Noonan and Paez.

The Hon. Harry Pregerson

Facts: DEA agents investigated an ecstasy distribution conspiracy headed by one of Underwood’s co-defendants. Id. at *1. They saw two co-Ds meet with Underwood and transfer two unmarked crates from Underwood’s vehicle into their own. Id. Agents tracked the crates to the Heavy’s house: the crates were later found to contain thousands of ecstasy pills. Id. The DEA got search warrants for all involved, including Underwood’s “home.” Id. When they arrived to search Underwood’s house, they found his mother who explained he didn’t live there. Id. Mom told the officers where Underwood lived, they did a “protective sweep” of the second house, found a small amount of pot, then got a state search warrant based on the federal search affidavit. Id. The state search warrant affidavit had probable cause facts that were literally cut and pasted from the federal agent’s affidavit, without clarification of which affiant was speaking. Id. at *2. The (102-page) federal search warrant affidavit was not attached to the state warrant application; the state magistrate never asked to review it. Id. at *3. The search revealed cocaine, ecstasy, cash, and other evidence. Id. In district court, Underwood challenged the probable cause for the search and argued that the Leon good faith exception did not apply. Id. “In a lengthy, scholarly order,” Judge Stephen Wilson granted the motion to suppress. Id. The government appealed. Id.

Issue(s): “The government appeals the district court’s grant of Underwood’s motion to suppress, arguing that (1) the warrant was not supported by probable cause, and (2) if the warrant was not supported by probable cause, the good faith exception applies.” Id. at *4.

Held: “We are not persuaded by these arguments.” 

1. Probable cause: Id. “When viewed in the totality of the circumstances, the affidavit here fails to provide a sufficient basis for probable cause. Like the affidavit in [United States v.] Weber, [923 F.2d 1138, 1145 (9th Cir. 1990)], the affidavit in Underwood’s case includes only two facts, foundationless expert opinion, and conclusory allegations.” Id. at *5.  

2. Leon Good Faith: “An analysis of the totality of the circumstances, including extrinsic factors, establishes that reliance on the search warrant . . . was objectively unreasonable. Thus, even assuming the affidavit was not entirely lacking in indicia of probable cause, the good faith exception is not met in this case.” Id. at *11.    

Of Note: Can extrinsic evidence be used in the Leon good faith analysis, to save a bare bones affidavit? The government argued yes, relying on the Supreme’s decision in Messerschmidt v. Millender, 132 S.Ct. 1235 (2012). 

  The Ninth is unpersuaded: “when we have determined that the affidavit is a bare bones affidavit, as we have here, even if the extrinsic factors point to reasonableness, they would not change the result. Reliance upon a bare bones affidavit is never reasonable.” Id. at *10. This little corner of the opinion contains an important Leon holding: a welcome limitation on the seemingly limitless Leon good faith exception.

How to Use: Underwood is terrific, and provides many useful principles for Fourth fights. Of particular interest is Judge Pregerson’s common sense analysis of the probable cause “showing” in the state search warrant affidavit. For example, a personal use amount of marijuana does not indicate the use of ecstasy – the target of this search, and certainly does not indicate that someone “is an ecstasy trafficker.” Id. at *5 (emphasis in original). The relationship between different types of drugs can be so attenuated that possession of one type does not establish probable cause than another type is present – a useful cite for future probable cause battles.

                                               

For Further Reading: In this era of bitter partisan rancor, one issue brings opposing legislators together: saving Federal Public Defenders. In a remarkable letter, Senators Coons (D-Del) and Sessions (R-Ala.) have together urged C.J. Traxler – Chair of the Executive Committee of the Judicial Conference – to review the impact that sequestration cuts are having on the Federal Defender Services account. See Senator Coon’s website and letter here.

  A critical bipartisan show of support from the branch of government that actually controls the dough.

Image of the “Underwood” Deviled Ham logo from http://farm2.staticflickr.com/1182/5160192097_ac439114c3_z.jpg

Image of the Honorable Harry Pregerson from https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgc3rM4iQOUZ8Vc2zxi3r9nh3y3Au34PbRpiBBQfxVUswhjRhPV1mEFxrXF688W3EurRVO6AizV24ILYsMQczhL351MqvAAqHjG2xnIBa5nJJkMhnjrZti-1Mqfwyy_1zeiWy4X/s640/david+rothman+and+judge+pregerson.jpg

Steven Kalar, Federal Public Defender, Northern District of California. Website at www.ndcalfpd.org

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