In United States v. Hernandez, 16-2765, the Second Circuit (Kearse, Cabranes, Lohier) affirmed the conviction of a member of La Mara Salvatrucha (MS-13), a street gang that operates in certain parts of the country, arising out of an initiation shooting in Brentwood.
In Split Decision, Court Again Applies Castleman To Interpret the “Force Clause” of the Armed Career Criminal Act
In Villanueva v. United States, the Second Circuit held by a 2-1 vote (Newman and Leval, with Pooler dissenting) that a conviction for first degree assault under Connecticut law qualifies as a violent felony under the Armed Career Criminal Act of 1984 (“ACCA”). The question before the Court was whether the Connecticut statute, analyzed under the “modified categorical approach,” is a violent felony that requires the use of physical force. The Court reversed the district court’s decision to grant the petition under Section 2255 and remanded the case for resentencing.
In Narrow Decision, Court Holds Dishonorably Discharged Veterans May be Denied Gun (and Bullet) Ownership
In United States v. Jimenez, the Second Circuit (Pooler, Raggi, Droney) rejected an as-applied Second Amendment challenge to a provision of the Gun Control Act of 1968 that makes it illegal for a person who has been dishonorably discharged from the military to possess guns or ammunition, 18 U.S.C. § 922(g)(6). In the decision, which marks the first time a federal court of appeals has grappled with the statute’s constitutionality post-District of Columbia v. Heller, 554 U.S. 570 (2008), the Court was careful to note that it was not considering a facial challenge and limited its discussion to persons, as here, who have been dishonorably discharged for “felony-like” military offenses.
On July 11, 2018, the Court of Appeals issued a short per curiam opinion (Wesley, Chin, Furman D.J. by designation) in Massey v. United States, affirming the sentence imposed on an individual who was convicted of possession of a firearm after a felony conviction pursuant to 18 U.S.C. § 922(g). Massey had committed three prior felonies in New York: third-degree robbery, second-degree assault, and second-degree attempted assault. Each of these was deemed a crime of violence under the “force clause” of the Armed Career Criminal Act (“ACCA,” codified at 18 U.S.C. § 924(e)). The question presented to the Court of Appeals was whether Massey’s sentence pursuant to the ACCA should be affirmed in light of the Supreme Court’s decision in Johnson v. United States, 135 S. Ct. 2551, 2563 (2015) (Johnson II), holding that the “residual clause” of the ACCA was unconstitutionally vague.
In United States v. Gasperini, the Court (Cabranes, Lynch, Carney) resolved various challenges by Fabio Gasperini, an Italian citizen, to his conviction under the Computer Fraud and Abuse Act of 1986 (“CFAA”). Gasperini was convicted following an elaborate hacking scheme in which he exploited a “backdoor” of certain internet-connected devices around the globe to seize control of the devices, used the compromised devices to search for other vulnerable devices to grow his computer army, and then unleashed his “botnet” of over 155,000 machines to generate “ad click” revenue and launch distributed denial-of-service attacks. Gasperini was ultimately arrested in the Netherlands and tried in the Eastern District of New York.
Circuit Holds That Pending State Counts Qualify as “Anticipated” Sentence for Purposes of Sentencing Guidelines on Concurrent Sentencing
Is a term of imprisonment “anticipated” if charges are pending but the defendant has not yet pled or been found guilty? In a per curiam decision, United States v. Olmeda, No. 15-3449 (Katzmann, Leval, and District Judge Carter by designation) (June 22, 2018), the Circuit addressed whether a defendant facing pending state charges is subject to an “anticipated” sentence – which, under Section 5G1.3(c) of the Sentencing Guidelines, would require his federal sentence to run concurrently with any state sentence later imposed. Upon reviewing the relevant legislative history and case law, the Circuit determined that a state sentence is sufficiently anticipated for federal sentencing purposes even when the defendant's guilt has not yet been established in state court. This decision will make sentences marginally shorter for defendants who are in the unfortunate position of being prosecuted in both state and federal court at the same time.
What Was Decided Before Has Been Decided Again: The Amended Opinion in Martoma Cuts Back On The Initial Decision, But Still Affirms
On Monday a divided Second Circuit panel (Katzmann, Pooler, Chin) issued an amended decision upholding the conviction of former SAC Capital portfolio manager Mathew Martoma on one count of conspiracy to commit securities fraud and two substantive counts of securities fraud. The amended decision—like the original decision—is a major decision expounding on the common law of insider trading, from the leading Court on questions of federal securities law. The decision—both the majority and the dissent—requires close study not only of its 61 combined pages, but several prior Supreme Court and Second Circuit decisions upon which it is premised. In this regard, the decision reflects the continuing uncertainty that is created by the absence of a statute that specifically addresses insider trading. Both the majority and the dissent make compelling arguments, and the question of what should be permitted and prohibited would be resolved most constructively by the legislative branch.
Be Careful Where You Park: Circuit Finds No Legitimate Expectation of Privacy in Common Residential Lot
Earlier this year, in Collins v. Virginia, the U.S. Supreme Court held that the “automobile exception” to the warrant requirement does not authorize “a police officer, uninvited and without a warrant, to enter the curtilage of a home in order to search a vehicle parked therein.” 138 S.Ct. 1663, 1668 (2018). Earlier this week, in United States v. Jones, No. 16-87 (Jacobs, Cabranes, Raggi) (June 19, 2018), the Circuit had its first opportunity to grapple with the import of Collins. But it had little difficulty finding that a vehicle parked in a common lot shared by multi-family apartment buildings is not entitled to the same expectation of privacy as a vehicle parked “within the curtilage of one’s home,” and in a published opinion, affirmed the district court’s denial of a motion to suppress. In a separate summary order, the Circuit addressed and disposed of the defendant’s other arguments, and affirmed his conviction and sentence in full.
Circuit Vacates Child Pornography Sentence For Second Time, Citing District Court’s Failure to Follow Circuit’s Mandate
On June 19, 2018, in a split decision in United States v. Sawyer, No. 15-2276 (Jacobs, Pooler, Crawford) the Circuit issued a firm rebuke of a District Court judge who – per the Circuit’s mandate – reduced the defendant’s sentence on remand, but did so without curing certain deficiencies the Circuit had identified as making the sentence substantively unreasonable. The majority opinion makes clear that when the Circuit issues a mandate on remand, the district court is not at liberty to ignore it – even if the district court can achieve the same outcome (here, a reduced sentence) through different means. As the dissent (Jacobs, J.) observes, however, the holding yields the anomalous result whereby the District Court may have remedied the substantive unreasonableness of the initial sentence on remand, but because it did so for the wrong reasons – i.e., by expressly declining to link the reduction to the two variables identified in the mandate – the sentence could not stand.
No Shortcuts: District Court Must Calculate Guidelines Range Before Ruling on Sentencing Reduction Motion
In United States v. Brooks, the Court (Leval, Pooler, Hall) reiterated that district courts are required to calculate the applicable Sentencing Guidelines range when faced with a § 3582(c)(2) motion for a sentence reduction, and suggested that the failure to do so will rarely be harmless.
Court Allows Wife of Criminal Defendant to Amend Challenge to Forfeiture of Allegedly Commingled Assets on Due Process Grounds
In United States v. Daugerdas, the Court (Walker, Lynch, Chin) offered a lifeline to the wife of a defendant convicted of tax fraud, who sought to assert a third-party interest in funds that the Second Circuit had previously determined were forfeitable to the government as proceeds of the defendant’s crimes. The U.S. District Court for the Southern District of New York concluded that petitioner Eleanor Daugerdas failed to state a claim that she was entitled to retain funds that her husband, defendant Paul Daugerdas, had gratuitously transferred to her. She sought to argue that the tainted funds had been commingled with legitimately earned funds prior to their transfer and therefore could not easily be traced back to Paul’s crimes. But the question of whether the seized funds arose from Paul’s criminal activity had been decided in the affirmative by the district court as part of Paul’s sentencing. As a result, the district court held that Eleanor could not relitigate the issue of whether those funds should be characterized not as criminal proceeds but as substitute assets, which would require the government to seek forfeiture of other property belonging to Paul.
In United States v. Rose, the Court (Katzmann, Walker, and Bolden, sitting by designation) rejected a jurisdictional challenge to a guilty plea to violating the Hobbs Act, potentially giving rise to a Circuit split. The defendant, Floyd Rose, was charged with robbing his victim by forcing them to withdraw money from their bank’s ATM and then hand it over to Rose. After pleading guilty to Hobbs Act robbery, Rose argued that his plea should be set aside because the robbery lacked any connection to interstate commerce.
Robert du Purton was convicted of mail fraud and conspiracy to commit mail and wire fraud in 2001 for participating in an “elaborate scheme of fraudulent representations” in his rare coin business. According to trial evidence, du Purton lied to customers about the sources of coins, concocted phony auctions to drive up prices, and had his employees impersonate competitors or independent sources, among other things. His conviction was affirmed on direct appeal. Nearly fifteen years later, he brought a petition for writ of error coram nobis, claiming that the government presented false expert testimony at trial. In a per curiam decision, the Second Circuit (Katzman, Leval, Andrew Carter, District Judge) affirmed the denial of the petition.
In Amended Decision, Circuit Leaves In Place that “Hobbs Act” Robbery is a Categorical “Crime of Violence” Based on “Force Clause” but Eliminates Constitutional Blessing of “Risk-of-Force” Clause
Over a year and a half after issuing its initial decision in United States v. Hill, 14-3872-cr (August 3, 2016), the Court amended its decision on May 9, 2018. The amended decision maintains the Court’s holding that a Hobbs Act robbery is a categorical “crime of violence” under the so-called “force clause” clause (§ 924(c)(3)(A)). However, the amended decision excises the Court’s prior holding that the “risk-of-force” clause (§ 924(c)(3)(B), also called the “residual clause”) was not void for vagueness and also qualified the a Hobbs Act robbery as a categorical “crime of violence.”
Sentencing Court Must Provide Sufficient Reasons for Sentence Imposed to Determine if Factual Error Influenced Sentence
In United States v. Derek Armstrong, 18-368, the Second Circuit (Sack, Raggi, Kaplan) issued a summary order vacating a three-month prison sentence imposed on the defendant by the U.S. District Court for the Eastern District of New York for violating probation by failing to report for random drug testing. The defendant had previously been sentenced in 2015 to three years’ probation for filing false tax returns and it was his violation of that probation that resulted in the challenged sentence. On appeal, he argued that his prison sentence was procedurally unreasonable because it was based on an erroneous fact asserted by the government at sentencing: that the defendant had failed to pay any of the back-tax payments ordered by the district court.
In United States v. Mark Henry, the Second Circuit (Jacobs, Cabranes, and Wesley, Js.) affirmed that the Arms Export Control Act (“AECA”), 22 U.S.C. § 2751 et seq., does not constitute an unconstitutional delegation of legislative authority to the executive branch, in addition to addressing various issues of trial procedure. The defendant, Mark Henry, appealed his 2014 conviction following a jury trial of violating and attempting to violate the AECA by exporting “ablative materials”—military-grade technology used in rockets and missiles—and microwave amplifiers to customers in Taiwan and China. The AECA prohibits the exportation of ablative materials, microwave amplifiers, and other “defense articles” except pursuant to a license issued by the Directorate of Defense Trade Controls, a division of the U.S. Department of State. The government presented evidence at trial that the defendant was aware of the need for an export license, that he did not have such a license, and that instead of acquiring a license the defendant took steps to conceal his exportation of restricted materials through the use of intermediaries, fictitious companies, and falsified documents, among other things. The court allowed the defendant, who is from China and primarily speaks Mandarin, to testify at trial in English through the help of a standby interpreter, although the court otherwise required a translator to assist the defendant throughout the trial.
On May 2, 2018, the Second Circuit held in United States v. Jamaal Brooks (Parker, Lynch, Chin) (per curium) that the district court erred in imposing a sentence of lifetime supervised release on a defendant who had violated prior terms of supervised release due to continued drug use and failure to report to scheduled drug testing. The Court stressed that while the sentencing court has substantial discretion in fashioning an appropriate sentence, a term of supervised release is nonetheless substantially unreasonable if it is improperly justified by retribution and deviates significantly from the sentence given to similarly-situated violators. Supervised release imposes real burdens on both defendants and the justice system, and this decision is a reminder that, as in other aspects of federal sentencing, the punishment should fit the crime.
In United States v. Litvak, the Second Circuit (Winter, Chin, Korman D.J.) reversed the conviction of Jesse Litvak, a securities trader at investment bank Jefferies & Co., for securities fraud premised on Litvak’s misrepresentations to trading counterparties about Jefferies’ profits on the transaction. The Court held that the district court improperly admitted testimony that Litvak’s counterparty believed that Litvak was acting as his fiduciary agent—even though in fact no such relation existed. The Court explained that the counterparty’s erroneous, subjective belief was irrelevant as to the objective materiality of the misstatement, but likely swayed the jury in convicting. The decision also raises interesting questions about expectations between traders and their customers, and the Government’s role in policing that relationship. For our discussion and commentary on this decision, please see our article on Law 360.
On May 1, 2018, the Second Circuit (Lynch, Carney, Hellerstein D.J. (concurring)) reversed the district court’s denial of Defendant Robert Alexander’s motion to suppress guns found after a search of a bag in front of a shed in Alexander’s backyard. The panel closely reviewed Supreme Court case law on whether certain areas near the home are considered the “curtilage,” and thus are protected to by the Fourth Amendment. The decision also includes a notable concurrence from Judge Hellerstein, who argued for extending Terry v. Ohio’s “stop and frisk” doctrine to include searches of areas near the home based on reasonable suspicion of wrongdoing.
In 2014, a federal jury acquitted Gerald E. Bove of one count of Hobbs Act conspiracy and one count of Attempted Hobbs Act extortion. Following his acquittal, Bove applied for reimbursement of the attorney’s fees and expenses he incurred in defending the criminal charges, pursuant to a rarely-litigated statutory provision known as the Hyde Amendment of 1997, codified at 18 U.S.C. § 3006A. On April 26, 2008, the Second Circuit (Cabranes, Livingston, Carney, Js.) affirmed the district court’s denial of Bove’s application, and in doing so confirmed that the standard for criminal defendants to recover fees and costs is high, and the discretion afforded district courts presented with Hyde Amendment applications is wide.
In a case arising out of the CityTime scandal, the Second Circuit issued a thoughtful opinion addressing the operation of restitution and asset forfeiture on victims of white-collar crime. The decision, Federal Insurance Company v. United States of America, Nos. 16-2967-op and 16-3402-cr, emphasizes that though restitution and forfeiture are both means for victims to be made whole, they are not subject to the same analysis. Ultimately, the Court (Parker, Lynch, Carney) affirmed the decision denying restitution, but remanded for additional proceedings on forfeiture. The decision is worth a careful read for those representing victims in white-collar criminal matters, and also serves as a road map for how district court judges might approach these issues in the future.
Sneaking Isn’t Laundering: Second Circuit Reverses Money Laundering Conviction for Insufficient Evidence of Intent to Disguise
In United States v. Rodriguez, a panel of the Second Circuit (Judges Katzmann, Walker, and Bolden (D. Conn., sitting by designation)) reversed the conviction of a defendant for money laundering. It concluded that the Government had established only that the defendant, Angelo Rodriguez, had attempted to deliver $300,000 in cash proceeds from sales of cocaine to what turned out to be an undercover agent—but not that the purpose of the transaction was to “to conceal or disguise the nature of . . . the proceeds of specified unlawful activity,” as the money-laundering statute requires. See 18 U.S.C. § 1956(a)(1)(B)(i). Although the panel acknowledged that the Government had presented evidence that the attempted delivery of cash was covert, it held that the circumstances of the transaction were “equally consistent with the purpose of paying off a drug supplier or purchasing additional drugs, which aims do not entail the intent to conceal required by” the money-laundering statute. In other words, the panel made clear that the mere covert delivery of money in connection with an illicit scheme does not amount to money laundering: the Government must prove that the transaction was specifically intended to disguise the use of the funds for an unlawful purpose.
Second Circuit Remands Ineffective Assistance Claim for Lawyer’s Failure to Apprise Naturalized U.S. Citizen of Denaturalization Risk Before Guilty Plea
In Rodriguez v. United States, the Second Circuit remanded the case to the district court to hear evidence on a defendant’s application to vacate her guilty plea, on the grounds that she would not have entered into the plea if her counsel had properly advised her as to its immigration consequences. The Circuit, in a summary order written by Judges Walker, Lynch, and Chin, concluded that there was a reasonable probability that, had she been properly advised, she may have chosen not to plead guilty and thus may have avoided the immigration consequences that later ensued. Accordingly, it remanded the case to the district court to develop an evidentiary record and make a finding on those issues. The order requiring a hearing on a defendant’s right to extraordinary relief represents a reminder to judges and prosecutors that the immigration consequences of a guilty plea are no less central to the plea allocution than the contemplated term of imprisonment. The decision follows the Supreme Court’s decision last term in Lee v. United States, 137 S. Ct. 1958, 1967 (2017). In Lee, the Court held that a defendant who would not have pleaded guilty but for counsel’s errors concerning the deportation consequences of his or her plea has demonstrated ineffective assistance.
Missing Texts, Unfair Trial: Second Circuit Remands Case for Possible Brady Violations and Sentencing Irregularities
In United States v. Djibo, the Second Circuit vacated and remanded a judgment of conviction entered in the Eastern District of New York (Johnson, J.) following the defendant’s trial on charges arising from an international heroin-smuggling conspiracy. In a summary order by Judges Sack, Hall, and Droney, the Circuit concluded that errors had affected both the trial and the sentencing, and reassigned the case to a new judge on remand.
Court Declines to Allow Defendants in Fraud Scheme to Utilize 28 U.S.C. § 2255 or Writ of Coram Nobis to Challenge Order of Restitution
In United States v. Rutigliano, No. 16-3754 et al., the Second Circuit (Jacobs, Raggi, Droney) refused to endorse the reduction of a restitution order against defendants who had conspired to submit fraudulent disability pension applications, either via a motion under 28 U.S.C. § 2255, or via a petition for a writ of coram nobis pursuant to 28 U.S.C. § 1651. Although the panel declined to hold that such vehicles could never be used by criminal defendants to collaterally attack an order of restitution, the Court made clear that the facts at hand rendered both § 2255 and § 1651 relief unavailable to these defendants, and vacated the district court’s order reducing defendants’ restitution obligations.
Promises, Promises: Second Circuit Reverses District Court’s Ruling That Suppressed Post-Arrest Statements Based On Allegedly Coercive Promises By Law Enforcement
In United States v. Haak, 16-3876-cr, the Second Circuit (Raggi, Hall, Carney) reversed a suppression order, finding that local law enforcement authorities did not falsely promise the defendant immunity from prosecution and his statements therefore were not coerced in violation of the Fifth Amendment.
The Second Circuit Counts to Three: How One Defendant Became a Career Criminal Over the Course of an Hour
In United States v. Bordeaux, 17-486-cr (Cabranes, Raggi, Vilardo), the Second Circuit held that the defendant’s three prior Connecticut state convictions for first-degree robbery—all of which took place during a single night—satisfied the requirements for conviction under the Armed Career Criminal Act (ACCA), 18 U.S.C. § 924(e). The opinion confirms that a conviction under Connecticut’s first-degree robbery statute constitutes a “violent felony” within the meaning of the ACCA and continues the majority approach to interpreting the “different occasions” requirement of the Act—which places the greatest emphasis on whether a defendant had time to contemplate his actions between the incidents giving rise to his prior convictions. Much is at stake for the defendant: a conviction under Section 924(e) carries with it a mandatory consecutive 15-year term of imprisonment.
The Price of a Drug Conspiracy Conviction: Second Circuit Remands $5 Million Forfeiture Order in Light of Recent Supreme Court Precedent
In United States v. Papas (17-cr-1591-cr), the Second Circuit remanded by summary order a $5 million forfeiture order entered in the Southern District of New York (Daniels, J.) after the defendant pleaded guilty to conspiracy to distribute marijuana. Judges Cabranes, Carney, and Caproni (sitting by designation) were on the panel.
In United States v. Ballard, 17-427-cr, the Second Circuit reversed a sex trafficking conviction by summary order (JAC, RR, Villardo, J. by designation) due to improper argument by the government during rebuttal summation.
The Court rejected the defendant’s arguments that some of the rhetoric in the government’s main summation amounted to error. Defense counsel did not object to these comments, which included calling the defendant a “dead beat,” a “pimp,” and similar to “Genghis Khan or some other Wall Street person.”
In United States v. Dove, 14-1150-cr, the Second Circuit (Walker, Pooler, Chin) upheld a drug conspiracy conviction against claims that the government improperly shifted its case away from the broader conspiracy charge in the indictment. The defendant alleged that this amounted to a constructive amendment or a prejudicial variance, in violation of the Fifth Amendment Grand Jury Clause. The 2-1 decision, with Judge Chin dissenting, raises thorny questions about the evidence necessary to prove a defendant’s awareness of his role in a larger conspiracy and the government’s ability to thwart a lack-of-awareness defense through its selection of evidence at trial. Although the Court affirmed, the extended discussion and the dissent may be useful to future litigants who wish to invoke these defenses.
Second Circuit Holds Government Can Establish Venue By Directing Cooperator to Place Calls to Co-Conspirators From That District
In United States v. Tank Yuk, et al., 15-131 (March 15, 2018), the Second Circuit (Chin (dissenting), Carney, Forrest, sitting by designation) affirmed the convictions of three defendants in a drug trafficking conspiracy who were prosecuted and convicted by a jury in the U.S. District Court for the Southern District of New York, despite the fact that the bulk of defendants’ criminal activities took place in the U.S. Virgin Islands and Florida. The central issue on appeal was whether venue was proper in the S.D.N.Y.; the majority held that it was, but Judge Chin dissented, concluding that it was not foreseeable to the defendants that an act in furtherance of the conspiracy would occur in the S.D.N.Y.
In United States v. Smith, No. 15-3313-cr, the Second Circuit (Winter, Cabranes, Restani, sitting by designation) held that New York second-degree robbery is a “crime of violence” under § 4B1.2(a) of the 2014 United States Sentencing Guidelines. As the panel acknowledged, Smith follows directly from United States v. Jones (2d Cir. Oct. 5, 2017), covered here and here, which held that New York first-degree robbery is a crime of violence under the same Guidelines provision because the official commentary lists robbery as a crime of violence, and New York generically defines first-degree robbery to include as an element the taking of property from another person, or person’s immediate presence, by force or intimidation. The panel reasoned that the rationale of Jones was “directly applicable” because New York second-degree robbery has the same element involving the use of force or intimidation.
Second Circuit Reminds Courts They Must Advise Defendants of the Immigration Consequences of Guilty Pleas
In United States v. Gonzales, 16-4318 (March 13, 2018), the Second Circuit (Sack, Parker, Carney) in a per curiam order vacated the conviction of a defendant who had pled guilty without being informed that he was likely to be deported at the end of his sentence. On June 23, 2015, Wilfredo Gonzales appeared before the Western District of New York (Geraci, C.J.) and pled guilty pursuant to a plea agreement to one count of conspiracy to manufacture, possess with intent to distribute, and distribute cocaine, and one count of possessing a firearm in furtherance of a drug trafficking offense. During the plea colloquy, the District Court failed to inform Gonzales, who was a lawful permanent resident, that he could be removed from the United States as a result of his conviction.
In United States v. Holcombe, 16-1429-cr, the Second Circuit (Jacobs, Leval, Lohier) resolved three open issues involving a conviction for failing to register pursuant to the Sex Offender Registration and Notification Act (“SORNA”), 18 U.S.C. § 2250(a). First, the Court held that the interstate travel offense at issue “began” in the state the defendant left, New York, and thus venue in SDNY was proper. Second, the Court held that any potential vagueness in a 30-day window for updating registration did not render defendant’s conviction here void for vagueness given the passage of at least 18 months. Last, the Court rejected defendant’s claim that the SORNA registration requirement violated his constitutional right to travel.
In a recent nonprecedential summary order, the Second Circuit (Winter, Lynch, Chin) vacated and remanded a sentence due to a condition of supervised release that prohibited the defendant from having unsupervised contact with any minor, including his nine-year old son. The summary order in United States v. Donohue, 17-943-cr, reflects the Circuit’s continuing concern that the conditions of supervised release be appropriate given the defendant’s conviction and personal circumstances.
In United States v. Carosella, 17-896-cr, the Second Circuit clarified an open issue relating to Amendment 782 to the Sentencing Guidelines. Amendment 782 is sometimes called the “drugs minus two” amendment because it reduced the base offense level for drug offenses by two levels. Amendment 782 was made retroactive through Amendment 788, and allows for an offender to be resentenced when its application leads to a reduced Guidelines range. Amendment 782 has led to the reduction of more than 31,000 sentences—but more than 48,000 defendants have sought such relief, meaning that more than one-third of those defendants were turned away empty-handed. One defendant who did not receive such relief in the district court was Anthony Carosella, and in a per curiam opinion (Walker, Lynch, Chin), the Second Circuit affirmed this decision.
In a short opinion in United States v. Ohle, 16-601-cr, the Second Circuit (Leval, Calabresi, Cabranes) resolved two open questions about the application of Federal Rule of Appellate Procedure 4, both in the context of a proceeding brought under Title 21, United States Code, Section 853(n). Section 853(n) is the provision of forfeiture law that can be invoked by a third party who claims to have a superior interest in assets that the government is seeking to forfeit. The Circuit held that although 853(n) proceedings arise in the aftermath of a criminal conviction, these ancillary proceedings are civil in nature. The Circuit also held that when the district court issues a short order resolving a motion and promises that a more detailed opinion will follow, plaintiffs may not wait for the more detailed opinion; the time to appeal begins to run upon the issuance of the initial order.
In United States v. Gomez, 16-181-cr (Parker, Wesley, and Droney), the Second Circuit found that the defendant’s Fourth Amendment rights were violated during a five-minute traffic stop because the police officers extended the stop for reasons unrelated to the defendant’s traffic violations. However, the Court nonetheless affirmed the conviction, ruling that the good-faith exception applied given that the officers acted legally under the Second Circuit’s prior precedent.
On February 9, 2018, the Second Circuit issued a summary order vacating a sentence imposed for a violation of supervised release. United States v. Kalaba, 17-328, involved a defendant who had been convicted for credit card theft and who was sentenced to 70 months’ imprisonment. After his time in prison concluded, he began a three-year term of supervised release. Before his supervised release term ended, Kalaba was arrested and indicted with multiple narcotics offenses, for which he was sentenced to 84 months’ imprisonment, well below the 240 month sentence recommended by the U.S. Probation Office.
In a 12-page summary order issued on February 9, 2018, the Second Circuit affirmed an order of restitution in United States v. Quatrella, 17-1786. The order is interesting primarily because it addresses the question of when a victim of an offense is not really a victim but rather a fellow participant in the criminal scheme. The rule in the Circuit is clear: no order of restitution should be granted that has the effect of treating a coconspirator as a victim. At the same time, a victim may not be denied restitution simply because the victim had greedy or dishonest motives, so long as the victim’s intentions were not in pari materia with the defendant’s.
In a short summary order issued on February 9, 2018, in the case of United States v. Muir, 17-150, the Second Circuit affirmed a sentence and reminded everyone that nothing about Apprendi, Booker and their progeny changes the rule that existed even prior to the Sentencing Reform Act: uncharged and acquitted conduct can be relied upon by the district court at sentencing. This is not a violation of either the Due Process Clause or the Double Jeopardy Clause of the Fifth Amendment, nor does it violate the Sixth Amendment’s guarantee of the right to trial by jury. So long as the court finds that the relevant facts are proved by a preponderance of the evidence and do not increase either the statutory minimum or maximum sentence, there is no violation of law.
In United States v. Zukerman, No. 17-948 (2d Cir. Feb. 6, 2018) (ALK, RAK, RSP) (summary order), the appellant, Morris Zuckerman, challenged the substantive and procedural reasonableness of his sentence, which was imposed following his pleading guilty for tax evasion and obstruction of the IRS, see 26 U.S.C. §§ 7201, 7212(a). While Zukerman’s plea agreement contained a stipulated fine range of $25,000 to $250,000, the district court (Torres, J.) imposed a fine of $10 million. Given that tax fraud defendants are typically required to resolve their civil tax liabilities in parallel proceedings, it is unusual for such a large fine to be imposed in this type of case. After acknowledging that fine calculations are typically committed to the discretion of the sentencing judge, the Second Circuit held that Judge Torres’ comments at the sentencing hearing and in the written statement of reasons did not provide the panel with a sufficient basis to determine how she reached the $10 million fine amount. Rather than try to guess what considerations went into this calculation, the Court ordered a so-called “Jacobson remand”—wherein it remands “partial jurisdiction to the district court to supplement the record on a discrete factual or legal issue while retaining jurisdiction over the original appeal”—and directed the district court to “elaborate on its rationale for imposing a fine greater than those typically imposed in tax prosecutions.”
Circuit Says “I’ll Drink To That,” Grants Defendant’s Appeal Challenging Alcohol-Ban Condition of Supervised Release
Update: The Second Circuit’s decision in United States v. Betts (No 17-231), which was initially released as a non-precedential summary order on February 5, 2018, was re-released as a published opinion on March 28, 2018. A copy of the opinion can be found here. This upgrade to a precedential opinion is consistent with the Circuit’s recent focus on reasonableness review of the conditions of supervised release. For more on that subject, see our recent post on United States v. Donahue (17-943-cr) Second Circuit Continues To Give A Close Look To Supervised Release Conditions. We also welcome the Court’s decision to make this ruling one with precedential impact rather than a summary order. Even when the legal standard is neither disputed nor newly pronounced, the development of the law requires the application of the standard to different sets of facts, so that attorneys may argue by analogy. Given the relative infrequency with which sentences are reversed for being unreasonable, more guidance from the Circuit is always appreciated.
Joseph Tigano’s Ticking Clock: Circuit Reverses Conviction of Defendant Forced to Wait Seven Years for Trial
On November 15, 2017, the Second Circuit reversed by summary order the conviction of Joseph Tigano III on drug charges, determining that he had been deprived of his Sixth Amendment right to a speedy trial and indicating that an opinion would follow. This week, the court issued its opinion, detailing the “exceptional facts” that had culminated in a nearly seven-year lapse between Mr. Tigano’s arrest and his trial, despite his repeated invocation of his right to a speedy trial. Indeed, the Court stated that the pretrial detention here “appears to be the longest ever experienced by a defendant in a speedy trial case in the Second Circuit.” The Court held that that length of time, combined with other relevant factors, compelled the conclusion that his Sixth Amendment rights had been violated. Judge Pooler authored the opinion, and was joined by Judge Winter and Judge Walker.
On January 9, 2018, the Second Circuit (Kearse, Cabranes, Wesley) rejected a request by ex-AOL Inc. employee Jason Smathers to junk the restitution component of his sentence, which requires him to recompense the online service provider for the losses it incurred after Smathers sold 92 million AOL screen names to spammers in the early 2000s—one of the earliest large-scale data security breaches of the Internet age. Smathers argued that his restitution award should be offset by damages later obtained by AOL in litigation against Smathers’s co-conspirators.
In a summary order on January 2, 2018 in United States v. Reyes, the Court (Winter, Lynch, Droney) vacated and remanded a life sentence as procedurally unreasonable on the ground that the district court failed to properly apply a reduction for acceptance of responsibility under U.S.S.G. § 3E1.1. The decision reiterates that a three-level reduction is mandatory under certain circumstances if the district court has already imposed a two-level reduction, and that the government must formally move for a three-level reduction in order to bind the court’s hands. The third point of acceptance of responsibility under the Guidelines is not a matter of grace or kindness by the district court. When a defendant is entitled to receive the third point, the district court is obliged to award it.
In Ganek v. Leibowitz, No. 16-1463, 2017 U.S. App. LEXIS 20226 (2d Cir. Oct. 17, 2017), the U.S. Court of Appeals for the Second Circuit recently reversed a district court’s determination that federal prosecutors and agents were not entitled to qualified immunity from plaintiffs’ Bivens claims for money damages for violations of the Fourth and Fifth Amendments in procuring and executing a search warrant.
Second Circuit Remands for New Trial Based on District Court’s Improper Exclusion of Advice-of-Counsel Testimony
In United States v. Scully, 16-3073-cr (Pooler, Lynch, Cogan), the Second Circuit vacated the defendant’s conviction for various offenses, including mail and wire fraud, conspiracy to defraud the United States, the sale of misbranded and unapproved drugs, and the unlicensed wholesale distribution of prescription drugs, finding that the District Court erred in excluding evidence related to his advice-of-counsel defense. The opinion provides a helpful overview of the requirements of Rule 403 balancing and the nature of the burden in establishing an advice-of-counsel defense.
In Rare Ruling Vacating Sentence as Both Procedurally and Substantively Unreasonable, Second Circuit Expounds on the Role of Mercy in Sentencing
In United States v. Singh, 16-1111-cr (Kearse, Hall, Chin), the Second Circuit vacated the defendant’s 60-month prison sentence—which was nearly three times the top of his Guidelines range—for illegally reentering the United States after the commission of an aggravated felony on the grounds that it was both procedurally and substantively unreasonable. This opinion stands out as a rare ruling striking down a sentence as substantively unreasonable. It is also notable for the Court’s musings on the role of mercy in the sentencing process.
On Tuesday in Washington v. Griffin, 15-3831-pr (Katzmann, Kearse, Livingston), the Second Circuit affirmed the denial of a petition for a writ of habeas corpus on a Confrontation Clause challenge. At issue was whether it was proper for the New York trial court to admit DNA profile evidence without affording the petitioner, Kenneth Washington, the opportunity to cross-examine the analysts who tested his DNA. This case illustrates the special challenges faced by habeas petitioners where, as in the Confrontation Clause context, Supreme Court precedent is developing and fractured. It also reflects the Circuit’s uncertainty about the state of the law in light of a series of Supreme Court precedents. This line of authority began in 2004 with Crawford v. Washington, 541 U.S. 36 (2004), which stated a definitive rule that out-of-court statements that were “testimonial” could only be offered so long as the witness was available for cross-examination, and has continued through Williams v. Illinois, 132 S. Ct. 2221 (2012), which is far more ambiguous due to the absence of a majority opinion.
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