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Second Circuit Reverses In Part and Affirms In Part In Appeal From Convictions Under Sarbanes-Oxley and Accessory-After-The-Fact Statutes

On February 23, 2017, the Second Circuit (Chief Judge Katzmann, Judge Winter, and District Judge Sidney Stein, by designation) issued a per curiam decision in United States v. Natal, et al., that led to a partial reversal and remand for resentencing in the case of one defendant, Hector Morales. The Court held that the conviction of one defendant—Hector Morales—for destruction and concealment of evidence must be vacated because his conduct was not prohibited by Title 18, United States Code, Section 1519. This was a direct result of the Supreme Court’s decision in Yates v. United States, 135 S. Ct. 1074 (2015), which limited the reach of the relevant statute to the destruction of objects that can be used to record or preserve information. We have previously reported on this important decision. Here, the repainting of a van allegedly used to drive away from a crime scene was held to be outside of the reach of Section 1519, as limited by Yates. This reversal of the Section 1519 count requires that Morales be given a de novo resentencing.

The Court also accepted Morales’s argument that the lower court incorrectly applied the Sentencing Guidelines because it did not group the three counts of conviction for accessory-after-the-fact. The trial court mistakenly treated each of the three counts as separate because there were three victims of the underlying offense—a fatal arson—and the Guidelines provide that offenses involving different victims are generally not to be grouped. However, the specific offense here was not the underlying arson but a conviction for accessory-after-the-fact, which the Court held is “differently punished” because it is not an offense against the victims of the underlying crime. Rather, it is an offense against the administration of justice. As a result, the counts should have been grouped. Grouping would have resulted in a Guidelines range of 121-151 months’ imprisonment, rather than the range of 168 to 210 months’ imprisonment that was applied at sentencing.

The Second Circuit also adopted an important new rule, proposed by the defense, relating to the admissibility of cell phone tower testimony when offered by the government as evidence of a suspect’s location. The Court held that prosecutors seeking to introduce testimony regarding how cell towers operate must do so using an expert witness, and must disclose that expert opinion in discovery pursuant to Rule 16 of the Federal Rules of Criminal Procedure. In the trial here, the government did not provide the defense with notice of its intention to offer locational cell phone tower evidence, nor did it offer such evidence through an expert witness. Rather, the testimony was given by a lay witness who lacked the required expertise to provide the adduced testimony. Because the government did not disclose the nature of this testimony prior to trial, the defense was unable to cross-examine the government’s witness, and neither could it offer expert testimony of its own to rebut the government’s witness. The Court nevertheless concluded that on the particular facts presented here, these preserved errors were harmless, and therefore the Court did not order a new trial.

All other arguments presented by Morales and by his co-defendant, Hector Natal, were turned aside by the Court.

Patterson Belknap Webb & Tyler LLP represented Hector Morales, pursuant to the Criminal Justice Act, in this appeal.

-By George LoBiondo and Harry Sandick