Friday, March 28, 2014

Defendant appeals conviction; government cross-appeals forfeiture request rejection

US v. Blackman:  Khalil Blackman received two convictions after a bench trial for his part as the fence in an armed robbery conspiracy.  The other conspirators took pleas and agreed to cooperate with the Government.  He was convicted of conspiracy to commit robbery, and using or carrying a firearm during and in relation to a crime of violence.  At sentencing, the district court imposed a restitution award of the value of the stolen goods (imposed jointly and severally with co-conspirators), but rejected the Government’s request for forfeiture in the same amount.  On appeal, Blackman challenged the sufficiency of the evidence; the Government cross-claimed, arguing the district court erred in denying its forfeiture request.

On appeal, Blackman argued that the evidence was insufficient to support his conviction, especially his conviction for carrying a firearm during a crime of violence, as he did not personally participate in the armed robberies; also, that the district court erred in basing its judgment on Pinkerton when the indictment did not mention that case.  The Fourth Circuit panel cited to an earlier case, U.S. v. Ashley, in which it held that it is not necessary for an indictment to mention Pinkerton in order for that case to serve as the basis for a conviction. Further, “when one reaps the benefits of a collective criminal enterprise, one should be prepared to accept collective consequences.”

With respect to the government’s cross-claim, the panel reversed the district court’s forfeiture ruling as unsupported by any legal authority.  According to statute, when the necessary prerequisites are met, forfeiture must be imposed; it is not a matter for judicial discretion.  Here, the necessary predicates had been met, and the Fourth Circuit determined that the district court erred when it decided to not order forfeiture.  The panel remanded this portion of the case back to the district court for the imposition of a forfeiture money judgment in the amount of the stolen goods.

Tuesday, March 18, 2014

Supervised release does not begin during civil detention under Adam Walsh Act

US v. Neuhauser:  The issue in this case reached the Fourth Circuit following Neuhauser’s appeal of the district court’s decision to deny his motion to terminate his supervised release.  In 1999, he had been imprisoned for child sex offenses, a sentence which included three years of supervised release.   Prior to his release from prison, the government certified him as “sexually dangerous,” under the Adam Walsh Act, preventing his release from incarceration for the next four-and-a-half years.  At that time, the district court determined that Neuhauser did not meet the criteria for further civil commitment, so he was released from prison.

Upon his release from civil detention, Neuhauser moved to terminate his supervised release, arguing that the term imposed had started upon the end of his criminal sentence while he was still in jail on a civil commitment.  Further, he argued that civil confinement does not constitute imprisonment.  The district court disagreed, reasoning that “release from imprisonment” occurs only when a person is freed from confinement; and that Neuhauser’s supervised release started when his civil detention ceased.  Neuhauser timely appealed.

The Fourth Circuit panel started with the statute governing release from prison, 18 U.S.C. § 3624(e), in which it states, the “term of supervised release commences on the day the person is released from imprisonment.” The panel found Neuhauser’s definition of imprisonment did not jive with the broad definition of “imprisonment” it read in the statutory language.  Moreover, the panel found related Supreme Court analysis which rejected Neuhauser’s argument, holding that supervised release has no statutory function until confinement ends.  Additionally, other courts considering this precise issue have recently held that supervised release does not begin until an individual detained pursuant to the Adam Walsh Act is released from confinement (Eighth Circuit and District of Maryland).  The Fourth Circuit affirmed the denial of Neuhauser’s motion to terminate his supervised release.

NCIC report & other government corroboration establish the fact of an old conviction by a preponderance of the evidence, yet Sixth Amendment claim carries some force

US v. McDowell:  Ernest McDowell pleaded guilty to possession with intent to distribute heroin and being a felon in possession of a firearm.  At sentencing, the probation officer recommended McDowell be sentenced as an armed career criminal, based upon three prior convictions that allegedly met the definition of “violent felony,” except that one of these convictions, a 1971 NY conviction for second degree assault, lacked a formal judgment documenting it.  The government, in order to establish the existence of this conviction, relied on an NCIC report for its proof but failed to incorporate it into the record.  The district court sentenced McDowell as an armed career criminal, and he appealed.

In the first appeal, the Fourth Circuit found error by the district court by basing its sentence on the NCIC without making the report part of the record.  On remand, McDowell renewed his argument that the NCIC was “inherently unreliable” as a means of proving the existence of this conviction (which he never conceded) for ACCA purposes.  The district court entered the NCIC into the record, in addition to some other corroborative information the government located, i.e., NY Dept. of Corrections info and fingerprint analysis results that indicated the 1971 conviction was McDowell’s.  The district court sentenced McDowell again as an armed career criminal, but imposed a shorter sentence than the first one imposed, on account of McDowell’s “good behavior in the interim.”

On this appeal, McDowell raises a procedural and constitutional challenge to his sentence, arguing that the NCIC report cannot establish the fact of the 1971 conviction by a preponderance of the evidence, and that his Sixth Amendment rights have been violated because he has a right to have a jury find each element of his offense beyond a reasonable doubt.  The constitutional question provided McDowell more traction, as the Fourth Circuit panel finds the Supreme Court’s Sixth Amendment exception at play here (normally, “any facts that increase the prescribed range of penalties to which a criminal defendant is exposed are elements of the crime” that a jury must find beyond a reasonable doubt,” Shepard v. United States) “incompatible with constitutional principles that are by now well settled.” Yet, the panel affirmed McDowell’s sentence based on the current state of the law.

Friday, March 14, 2014

Restitution Order affirmed

US v. Abdelbary:  In this appeal, the Fourth Circuit considers the propriety of an order requiring a defendant to pay attorneys’ fees incurred by a creditor in a bankruptcy proceeding as a part of restitution; the Fourth Circuit approved and affirmed.

Youssef Abdelbary received convictions in connection with a fraudulent bankruptcy filing. As part of his sentence, the district court imposed a restitution award to his creditor, Jordan Oil, for its attorneys’ fees. On his first appeal, the Fourth Circuit remanded because the district court failed to designate the statutory basis for the restitution, and overlooked the predicate factual findings required by the appropriate act, here, the Victim and Witness Protection Act ("VWPA") or the Mandatory Victim Restitution Act ("MVRA"). On remand, the parties agreed that the MVRA governed the issue. The district court again imposed a restitution award, finding as a factual matter that the attorneys’ fees for Jordan Oil were incurred as a result of the bankruptcy fraud; Abdelbary countered that attorneys’ fees should never be included as compensable costs as part of restitution under the MVRA, or in the alternative, that Jordan Oil was not a victim of Abdelbary’s bankruptcy offense.

In order to reach its decision, the Fourth Circuit discussed the background of both the VWPA and the MVRA, showing how particular types of losses could be included in restitution for certain types of crimes, including those involving damage to or loss or destruction of property, crimes involving bodily injury, and pertinently, for certain categories of offenses "that directly and proximately caused a victim to suffer either a physical or a pecuniary loss." The district court in this case found that Jordan Oil was a "victim" of Abdelbary’s offense because his attempt to discharge his debts to that company (via fraudulent bankruptcy filings) directly and proximately caused Jordan Oil to shell out cash for attorneys’ fees in order to protect its interests against Abdelbary’s fraud.

In dissent, Justice Diaz argues that the finding that all of Jordan Oil’s attorneys’ fees were directly and proximately caused by Abdelbary’s fraudulent bankruptcy, and that such a conclusion takes too broad a view of Abdelbary’s criminal conduct. He posits that Abdelbary may well have been able to file for bankruptcy without making any fraudulent representations, which would have dragged Jordan Oil into court, incurring attorneys’ fees all the while; the government failed to show, he states, that even if the defendant had been utterly truthful, that Jordan Oil would not have suffered the same harm.

Cross-reference's "purpose" requirement construed broadly

US v. Cox:  In this appeal, the Fourth Circuit considered a challenge to the application of a sentencing guideline cross-reference, which application resulted in a 13-level increase to the defendant’s sentence. The sentencing guideline in play was U.S.S.G. § 2G2.2, governing possession of material depicting the sexual exploitation of a minor.

Mr. Cox pleaded guilty to faking his death which caused to Coast Guard to search for him off the Carolinas when he was hiding out in Florida; and also to his knowing possession of material containing images of child pornography. Mr. Cox had in his possession multiple polaroid images he had taken while he sexually abused his minor niece. At sentencing, the district court determined that Mr. Cox was responsible for causing a minor to engage in sexually explicit conduct "for the purpose of" producing a visual depiction of that conduct.

On appeal, Mr. Cox claimed that the district court improperly applied the cross-reference found in the sentencing guideline that pertains to the possession of material depicting the sexual exploitation of a minor. The cross-reference applies when the offense conduct involved causing a minor to pose for the purpose of producing a visual depiction of the criminal conduct. Mr. Cox argued that there was insufficient evidence to support a finding that he acted for the purpose of producing a visual depiction, though he did not dispute that he caused the victim to engage in sexually explicit conduct, nor that he took pictures; rather, he contended that taking the pictures was not a "central component" of the criminal activity.

The Fourth Circuit agreed with the Ninth and Seventh Circuits on this issue, that producing the depiction need not be the defendant’s sole or primary purpose. The cross-reference’s "purpose" requirement "is satisfied anytime one of the defendant’s purposes was to produce a visual depiction" of the criminal conduct. The Fourth Circuit affirmed the application of the cross-reference.

Thursday, March 06, 2014

Knowledge of Minor's Age Not Necessary For Sex Trafficking Conviction

US v. Washington: In 2012 Washington met RC, a teenage runaway, in Maryland.  Although she was actually 14 years old, she told Washington she was 19.  He became her pimp, taking her to various states and advertising her availability on the internet.  Washington was arrested as part of a sting operation in Richmond.  He was charged with interstate transportation of a minor to engage in prostitution.  He was found guilty at trial, after the district court instructed the jury that the Government did not need to prove that he had any knowledge of MC's actual age.  At sentencing, the district court imposed a sentence of 240 months in prison, well above the top of the advisory Guideline range

Washington appealed, challenging his conviction and sentence, both of which the Fourth Circuit affirmed.  On the conviction, the court rejected Washington's argument that the district court erred by instructing the jury that he did not have to know MC was a minor in order to convict him.  The court concluded that its prior decision rejecting that argument had not been undermined by a more recent Supreme Court decision (involving identity theft) that expanded the reach of "knowingly" in a criminal statute, a conclusion reached by other Circuits.  As for the sentence, the court concluded that the district court properly considered the Guidelines, the 3553(a) factors, and that the variance itself and its extent were reasonable.