Tuesday, April 24, 2012

Lengthy Detention of Vehicle OK, Use of Prior Bad Act Not So Much

US v. McBride: Officers in South Carolina were performing surveillance of a club parking lot at about 6:15 in the evening.  Their attention was drawn to the club, which has in the past been a site of drug dealing, because there were several cars in the parking lot at the time, although the officers thought the club usually opened around midnight.  Officers saw what they thought might be a drug deal, which transpired in and around a black Cadillac SLS in the parking lot.  When one of the men involved drove away in the rain without his lights on, the officers pulled him over.  A subsequent search of that vehicle uncovered a large amount of cash.

The officers returned the club and went inside and were met at the door by McBride, who was the other man involved in the alleged drug deal they had observed.  The officers repeatedly told McBride and the others in the club that they were free to leave, but their vehicles outside were being detained pending the arrival of a drug dog from the next county.  At first, McBride claimed that the SLS was his, but after the drug dog was mentioned he "got very[,] very loud, nervous, [began] pacing back and forth, [and was] sweating profusely."  He also recanted his claim to ownership of the SLS.  After again being told he was free to leave (without his car), McBride left the club.  The drug dog arrived about an hour after the "detention" began and alerted on the SLS.  A later search pursuant to a warrant uncovered cash, drugs, and a firearm.

McBride was charged with gun and drugs offenses and moved to suppress the evidence seized from the SLS, which the district court denied.  McBride went to trial, where the Government introduced prior bad act evidence under FRE 404(b) from a CI who had tried to purchase crack from McBride in the past, but could not because the drugs were in the process of being cooked from powder to crack cocaine.  The district court instructed the jury that it could only consider the CI's testimony as to the issue of McBride's knowledge, intent, or lack of mistake.  McBride was convicted on all counts and sentenced to 235 months.

On appeal, McBride challenged both the denial of his motion to suppress and the admission of the 404(b) evidence.  As to the search, he made two arguments, both of which the Fourth Circuit rejected.  First, he argued that the officers lacked reasonable suspicion to detain the SLS.  The court disagreed, pointing to the officers' prior knowledge of the club and McBride, the potential drug deal that took place in the parking lot (and the resulting traffic stop and search), and the fact that so many people were at the club during non-business hours.  Second, McBride argued that even if the initial detention of the SLS was proper, the nearly hour-long delay caused by waiting for the drug dog was unreasonable.  The court disagreed, noting that the nature of the detention "did not impede McBride during any travel, because McBride already had arrived at his club" and that the duration of the detention, while lengthy, was not the result of any lack of diligence on the part of the officers.  As to the 404(b) evidence, the court agreed with McBride that it was improperly admitted because it was of dubious relevance to McBride's charged drug offense (possession with intent) and unduly prejudicial.  Further, the court was unable to conclude that the error was harmless.  Thus, McBride's convictions for possession with intent and using a gun during a drug trafficking offense were reversed, while the conviction for being a felon in possession of a firearm was affirmed.

Judge Wilkinson dissented on the 404(b) issue, arguing that the majority's position "pulls the trial process away from both the trial court and the jury, substituting its own assessment of the relevance and weight of the defendant's prior criminal activity."

Commerce Clause Covers Cockfighting; DIY Wikipedia Research from Juror Requires Reversal

US v. Lawson and US v. Gibert: These two cases involve multiple prosecutions and convictions under the federal statute criminalizing "animal fighting venture[s]" (in this case, cockfighting).  Lawson and his codefendants went to trial, while Gibert and codefendants entered guilty pleas.  Although the cases were argued together, the court entered separate opinions at the same time due to their "distinct legal issues."

Gibert (and his codefendants) pleaded guilty to conspiring to violate 7 USC 2156, which prohibits (among other things) "sponsor[ing] or exhibit[ing] an animal in an animal fighting venture."  As part of a plea agreement, he reserved the right to challenged the constitutionality of the statute on appeal.  He did so on two grounds, that the statute exceeds Congress's authority under the Commerce Clause and that, to survive scrutiny, the statute must be read to require the Government to prove that the defendant knew the animal fighting venture was "in or affected interstate commerce."  The Fourth Circuit rejected both arguments.  As to the Commerce Clause argument, the court noted that section 2156 (from the Animal Welfare Act) is part of a "comprehensive regulatory scheme" and quoted liberally from the legislative history leading to its enactment.  The court concluded that "we have no difficulty concluding that Congress acted within the limitations established by the Commerce Clause."  Specifically, the court found that the statute had the required nexus to interstate commerce.  As to the scienter argument, the court concluded that similar statutes based on the interstate nexus do not require the defendant's knowledge and neither does this one.

Lawson and many codefendants went to trial and were convicted on multiple counts relating to the cockfighting operation.  On appeal, he raised several issues, most of which the Fourth Circuit rejected.  First, it relied on Gibert to reject Lawson's argument that the statute violated the Commerce Clause.  Second, the court rejected Lawson's argument that because the Government had to prove an additional element during prosecutions in districts where animal fighting was legal (no states and only a few territories meet that criterion) it violated equal protection.  Third, the court concluded that the district court did not clearly abuse its discretion to deny Lawson's request for a trial separate from his codefendants. 

The court also rejected two arguments raised by four of Lawson's codefendants (referred to collectively as Dyal) who were convicted of conspiracy to engage in an illegal gambling business and operating an illegal gambling business.  First, the court concluded that the district court did not err by failing to instruct the jury that the Government must prove that Dyal knew their conduct was illegal under state law and that they weren't operating in good faith.  Second, the court concluded that the district court did not err by instructing the jury that the state gambling statute at issue was violated when "a person pays a fee to enter a contest of skill and the winnings depend on the number of entries."

However, the court did vacate Lawson's convictions, due to juror misconduct.  During deliberations, one of the jurors did some research on Wikipedia (really!) on the meaning of "sponsorship" (one of the elements of the offenses) and brought the fruits of his/her labor into the jury room.  Applying a presumption of prejudice due to the juror's DIY research, the court concluded that the Government could not rebut that presumption.  As a result, the convictions of the defendants convicted under AWA were vacated, although the conspiracy counts related to gambling (with two exceptions) were not.

Rule 11 Doesn't Require Notice of Loss of Benefits

US v. Nicholson: Nicholson was charged with federal workers comp fraud and entered a guilty plea.  Prior to sentencing, Nicholson asked to withdraw his plea on several grounds, including that he was under the influence of prescription pain killers at the time and "credibly asserting his legal innocence."  Although the item that spurred him to move to withdraw his plea was a letter from the government "terminating all future benefits and wages," that was not among the grounds cited as a basis to withdraw the plea.  The district court denied the motion to withdraw and sentenced Nicholson to probation.

On appeal, Nicholson raised several issues with regards to his plea, all of which the Fourth Circuit rejected.  First, the court concluded (applying plain error) that there was no violation of Rule 11 by the district court when it failed to explain to Nicholson that a conviction would make him ineligible for future benefits because that was a collateral, not direct, consequence of his conviction.  Second, the court concluded that the district court conducted an adequate inquiry into Nicholson's competency at the Rule 11 hearing, inquiring if he had taken any substances prior to the hearing and what those were.  Finally, the court concluded that the district court did not abuse its discretion by denying the motion to withdraw Nicholson's plea because there was no fair and just reason for doing so.

Counterfeit Goods Convictions Affirmed

US v. Lam: Lam and his codefendant, Chan, "owned or otherwise controlled" at least 10 companies that imported handbag and wallets into the United States.  Some of them were allegedly counterfeit.  After a seizure of goods in Norfolk in 2005, Lam and Chan were charged with conspiracy to traffic in counterfeit goods, trafficking, and smuggling, based on purses that bore markings and logos similar to those on products made by Burberry.  At trial, the main issue was whether the marks on the seized bags were "identical or substantially indistinguishable from" the Burberry marks.  After the district court denied their pretrial motion to have "substantially indistinguishable" declared unconstitutionally vague, Lam and Chan were convicted after a jury trial of conspiracy, trafficking, and smuggling (although not with regards to all the alleged fraudulent goods).  The verdict was "based, in part, on [the jury's] determination that the plaid displayed on the goods seized . . . was a counterfeit of the Burberry Check mark."

Lam and Chan raised several issues on appeal, all of which the Fourth Circuit rejected.  First, they argued that there was insufficient evidence to support their convictions.  The court concluded otherwise, holding that the fact that the seized goods included plaid mark with a knight imposed upon it could be found sufficiently similar to good with just a plaid mark (adding that those, in some cases, had an equestrian mark superimposed on them) and noting that counterfeit goods are not required to be exact matches of the products they are copying.  Second, the court rejected their argument that the jury plainly erred in instructing the jury about what it could consider when determining if the goods were counterfeit.  Third, the court concluded that "substantially indistinguishable" was "sufficiently clear to allow an ordinary person to understand what conduct it punishes" and was therefore not unconstitutionally vague, as all other circuits to deal with the issue also concluded.  Finally, Lam and Chan argued that they were entitled to a new trial (which the district court erred by not giving them) due to comments by the prosecution during trial that misstated the "perspective the jury should use" when determining if the goods were counterfeit, relying on a "average person on the street" view rather than the jurors' own judgment.  The court concluded that it was not an abuse of discretion for the district court to conclude that its instructions cured any problems raised by the Government's statements.

Judge Floyd dissented, arguing that the Government's comments about the "average person on the street" perspective were not overcome by the district court's instructions, noting that the Government "misstated the legal standard governing the key issue" eight times, six times after the first of the defense's four objections.

Third Time's the Charm for Terrorism Enhancement

US v. Chandia: This is the third appeal for Chandia as to his sentence, imposed following his conviction for providing and conspiring to provide material support to terrorists and a foreign terrorist organization.  All the appeals revolve around the district court's application of the "federal crime of terrorism" enhancement in USSG 3A1.4.  In the first appeal, the Fourth Circuit vacated Chandia's sentence and remanded for a "fresh analysis" about the enhancement, particularly whether Chandia had the intent necessary to trigger it.  In the second appeal, the Fourth Circuit vacated the sentence due to the district court's failure to resolve factual disputes and explain its findings.  On remand for the second time, the district court again concluded that the enhancement applied and imposed a sentence of 180 months in prison.

On appeal, Chandia challenged his sentence as procedurally unreasonable.  This time, the Fourth Circuit affirmed.  First, it rejected Chandia's argument that the factual basis for the enhancement should have been found by clear and convincing evidence due to the severity of the enhancement.  Second, it rejected Chandia's argument that the factual basis, even under a preponderance standard, was not sufficient to support the enhancement (the court spends several pages laying out the details of the facts of the case).  Finally, the court rejected Chandia's argument that the district court did not adequately consider all the relevant 3553(a) factors before imposing a within-the-Guideline-range sentence.