Tuesday, July 30, 2013

Career Offenders Convicted of Crack Offenses Are Not Eligible for a Sentence Reduction Pursuant to 18 U.S.C. § 3582(c) if the District Court Granted a Downward Departure Under U.S.S.G. § 4A1.3 at Sentencing

In United States v. Flemming, No. 12-1118, the Third Circuit held that crack defendants who were designated as career offenders, but were granted downward departures from their career offender status pursuant to U.S.S.G. § 4A1.3, are not entitled to a sentence reduction under 18 U.S.C. § 3582(c).

Flemming’s crack guideline range was 92 to 115 months imprisonment under U.S.S.G. § 2D1.1. Due to his designation as a career offender under U.S.S.G. § 4B1.1(a), however, his resultant guideline range became 262 to 327 months. The district court found that the career offender guideline overstated Flemming’s criminal history and granted a downward departure pursuant to U.S.S.G. § 4A1.3, finding that the crack guideline range of 92 to 115 months was more appropriate. The court ultimately sentenced Flemming to 175 months - 115 months for the crack offense, and a consecutive 60 month sentence for his 18 U.S.C. § 924(c) conviction. The district court reduced Flemming’s sentence under Amendment 706 to the guidelines, issued in 2007, which lowered the guideline ranges for crack offenses. See United States v. Flemming, 617 F.3d 252, 254-55 (3d Cir. 2010). Flemming was re-sentenced to 137 months - 77 months for the crack offense, and a consecutive 60 month term for the 924(c) conviction. He then moved for a second sentence reduction under Amendment 750 to the Guidelines, which further decreased the guidelines for crack offenses in response to the Fair Sentencing Act of 2010. The district court denied his motion.

The Third Circuit affirmed, holding that the Sentencing Commission’s policy statement § 1B1.10(a)(2)(B), precluding sentence reductions if a defendant’s "applicable guideline range" is not reduced by the amendment, prevented reductions in cases like these. During Flemming’s first appeal, the Third Circuit held that the Guidelines’ definition of "applicable guideline range" was ambiguous, and thus the rule of lenity allowed him to move for his first sentence reduction. Flemming, 617 F.3d at 270. Amendment 759 to the Guidelines, however, added a new definition of "applicable guideline range" in 2010. It is now defined as "the guideline range that corresponds to the offense level and criminal history category determined pursuant to § 1B1.1(a), which is determined before consideration of any departure provision in the Guidelines Manual or any variance."

The Third Circuit reasoned that since the definition states that the applicable guideline range is "determined before consideration of any departure provision in the Guidelines Manual or any variance," it is clear that a § 4A1.3 departure is ignored for purposes of determining a defendant’s applicable guideline range. See U.S.S.G. § 1B1.10 cmt. N. 1(A). Any § 4A1.3 departure is to be calculated after the applicable guideline range is calculated. The Court explained that its reading is supported by the Commission’s stated reason for adding a new definition of "applicable guideline range." The Commission meant to adopt the approach of those Circuit Courts of Appeal that have held that career offenders granted § 4A1.3 departures are not eligible for resentencing. U.S.S.G. app. C., amend. 759. Thus, Flemming was not entitled to a second sentence reduction under 18 U.S.C. § 3582(c).

Thursday, July 11, 2013

Issuance of United States Passport Is Not Conclusive Proof Of Citizenship/ No Brady Violation Where Defense Declines Continuance/ No Judicial Estoppel Where Inconsistencies Explained

United States v. Moreno , No. 12-1460 (3d Cir. 7/3/13) concerned a conviction for  false representation of United States citizenship. Ms. Moreno, born in Mexico in 1971, was adopted by  U.S. citizen nine years later. In 1981, New Mexico issued a birth certificate stating that her place of birth was Mexico.  Her conviction for possession with intent to distribute a controlled substance and false imprisonment, led to deportation proceedings, and after the Fifth Circuit affirmed a Board of Immigration Appeals determination that she was not a citizen, she was deported, in 2006, to Mexico.

In 2007, without permission, she returned to the United States and applied for a passport, listing New Mexico as her place of birth. The passport was issued, but seized by the Border Patrol in Texas. The passport was never revoked though. She was detained by ICE, but released pending further investigation.  In 2011, after she asked, DHS told her she was not a citizen.  Later that year, she traveled to the United States Virgin Islands and in response to a question about her citizenship, she gave an immigration officer her New Mexico driver’s license.  She also stated, in response to questions, that she was a U.S. citizen, gave them a certificate of live birth from New Mexico, and a copy of her U.S, passport.  Following inquiries to DHS, Ms. Moreno was arrested for falsely representing herself to be a U.S. citizen in violation of 18 U.S.C. §911. Following a jury trial, she was convicted.

On appeal, Ms. Moreno raised five issues. The first was that the District Court erred in denying her motion for acquittal because the issuance of a passport constituted conclusive proof of citizenship. 22 U.S.C. §2705   provides that a passport is proof of citizenship. However, §2705 provides that the passport is proof of citizenship only if it is issued to a citizen of the United States. Ms. Moreno was never a citizen, so the passport was not proof of citizenship. (A passport can be issued not only to a United States citizen, but to a United States “national,” which includes persons, though not citizens, owe permanent allegiance to the United States. 8 U.S.C. §1101(22) Ms. Moreno did not argue she was a United States national.). The Court noted that some other courts have held that a passport is conclusive proof of citizenship, but it expressly declined to adopt that interpretation.

The next issue Ms Moreno raised was whether the District Court erred by not instructing the jury that the issuance of the passport was conclusive proof of United States citizenship. Given its first ruling, the Court decided that failure to give that instruction was not error.

Ms. Moreno next argued that the government’s disclosure, the day before trial , of documents showing a DHS investigation concluding the passport was valid but calling for further investigation into her citizenship and that deportation should be stayed until her passport was revoked. She claimed this was a Brady violation, but she forewent an offer of a continuance, and an opportunity to cross-examine a government witness about the documents. Because she had sufficient opportunity to use the documents she did not suffer prejudice from the untimely disclosure.

Ms. Moreno’s argument that the District Court unfairly prevented her from introducing and FOIA documents and an FBI report listing her citizenship as “United States.” Because the jury had already heard evidence about government decisions listing her as  United States citizen, the documents were cumulative and would have caused juror confusion. The Court also rejected her argument that the government was judicially estopped from denying that she was a citizen because the passport had not been revoked. Passports issued in error are not automatically revoked, so the government had not asserted inconsistent positions.

Judge Smith dissented, posting that under  22 U.S.C. §2705, the passport should have been treated as conclusive proof of citizenship.

Wednesday, July 10, 2013

Court Finds Longest Insider-Trading Sentence Ever Imposed Reasonable (and rejects other sentencing challenges)

In United States v. Kluger, No. 12-2701 (July 9, 2013), the Court addressed numerous challenges to Kluger’s mid-range, 144-month sentence, "a term thought to be the longest insider trading sentence ever imposed." Kluger, a law student, and then lawyer for five different securities law firms over the course of his career, was the source of tips for a three-man insider-trading scheme that spanned seventeen-years, "and, so far as is known, constituted the longest such scheme in United States history." The Court rejected Kluger’s complaints about the calculation of his Guidelines range, purported procedural errors in his sentencing, and the procedural and substantive reasonableness of his lengthy term of imprisonment.

Guidelines calculation: Under § 2B1.4, the district court attributed all of the scheme’s monetary gain (nearly $50 million) to Kluger, even though his share of the profits was far less than that of one of his co-defendants. Kluger and both of his co-defendants had agreed to limit their trades in an effort to avoid detection, but one co-defendant had violated the agreement. Kluger therefore argued that, under § 1B1.3(a)(1)(B)’s reasonable foreseeability test, the district court should have reduced the gains attributable to him. Applying United States v. Cespedes, 663 F.3d 685, 689 (3d Cir. 2011), the Court held that the "unless otherwise specified" exception in § 1B1.3(a) required it to look first to the insider trading guideline. There, it found that "[t]he plain language of the commentary’s background unequivocally attributes all of [the co-defendant’s] gains to Kluger because [the co-defendant] was ‘a person[] acting in concert with the defendant,’ as well as one ‘to whom the defendant provided inside information.’" The Court emphasized that this result "reinforc[es] the deterrence message sent to would-be tippers."

Procedural errors: (1) Evidentiary Hearing. The district court did not err in refusing to grant Kluger an evidentiary hearing, since the Rules do not require an evidentiary hearing, and the district court did afford an "extensive sentencing hearing . . . in which the parties addressed the Court." Kluger had not disputed the total gain or that he was the source of the tips, so an evidentiary hearing would not have altered the outcome at sentencing. (2) PSR Objections. Kluger complained that the PSR did not resolve all of his objections, including to the characterization of the scheme and the description of him as the initiator of it. The Court noted that, under Rule 32(g), Probation is not required to do so. Rather, under Rule 32(i), the district court must make a disposition on matters that will affect sentencing, which it did when it made its ruling under §2B1.4. (3) Discovery. Kluger claimed that his due process rights were violated when the government provided materials to Probation that were not provided to him. The Court held that Rule 32 does not provide for broad discovery of presentence materials, and that even if it did, Kluger had done no more than speculate as to the existence of such materials.

Reasonableness of Sentence: (1) Procedural Reasonableness. Kluger argued that the district court only mechanically considered the § 3553(a) factors and failed to consider the "vast disparity" between his sentence, his co-defendants’ sentences, and the sentences of other insider traders. The Court found that the district court engaged in a thorough discussion of the circumstances of the offense and the history and characteristics of the defendant, "such as Kluger’s loving and supportive family, privileged childhood, and the ability of the Bureau of Prisons to manage his poor health during his incarceration." It rejected the disparity argument, as well, citing the facts that Kluger was an attorney, the source of the tips, and that he spent most of his career involved in criminal activity ("he truly was a career criminal"). Unlike one co-defendant, Kluger did not cooperate. Unlike the other, Kluger did not have a history of community service. Compared to other cases, this one was longer, more involved, and more successful. (2) Substantive reasonableness. Noting that Kluger received a within-Guidelines sentence, which is less likely to be unreasonable than one outside the range, the Court concluded, "we cannot say that ‘no reasonable sentencing court’ would have imposed the same sentence . . . ."

Tuesday, July 02, 2013

Under The Speedy Trial Act, The Trial Clock Remains Tolled In The Time Period Between a Competency Evaluation and a Court's Final Determination of Competency.

    In a matter of first impression, the Third Circuit held that the time statutorily excludable under the Speedy Trial Act (18 U.S.C. §3161(h)(1)(A)) for a competency evaluation extends past the actual examination and continues until the court has made a final determination concerning a defendant’s competency.  U.S. v. Graves, No. 12-2688,  (3d Cir. June 21, 2013)

    Appellant Lee Graves was arraigned on March 2, 2011 on one count of possession of cocaine with intent to distribute, in violation of 18 U.S.C. §841and §846.  At the arraignment hearing, held on March 31, 2011, a magistrate judge ordered a competency evaluation pursuant to 18 U.S.C. §4241(b).   Although the trial had been scheduled to start on June 3, 2011, the Bureau of Prisons (“BOP”) did not complete an evaluation report until June 22, 2011.  The report was mailed on June 28, 2011 and received, at the earliest, by the court on July 7, 2011.  A status hearing was held on September 21, 2011, during which the District Court found Graves competent to stand trial.  At that same hearing, newly-appointed defense counsel moved for a continuance to prepare for trial.      

    A few weeks after that hearing, Graves claimed a Speedy Trial violation.  He argued that more than 70 inexcuable days had passed since his indictment without a trial.  Specifically,  Graves argued that the excludable delay for the competency review ended when the report was sent to the court, while the Government argued that the clock remained tolled until the official ruling on his competency, which did not occur until the status hearing several months later.  The District Court found no violation. 
    The Third Circuit affirmed, finding that the language in the Act, relevant to delays for mental competency, contemplated excusing the entire evaluation proceedings, not just the actual examination.  The circuit court explained that the examination and resulting report constituted just one step in the process.  A trial court must still review the report and relevant evidence to determine if a defendant is fit to stand trial.  Also, in reaching this decision, the appellate court noted that the Act does not place a limit on the length of delays for a competency proceeding.  Therefore, the Third Circuit held that the clock remains tolled even after an evaluation report is submitted to the court, until a formal ruling on competency is entered by that court.
     Accordingly, the excluded delay included the time period from the day the evaluation was ordered (March 31) until the day the court entered the order finding Graves competent to stand trial (September 21).  Additionally, the Third Circuit also found that a new period of excusable delay began when the defense requested a continuance at the same September status hearing.  Thus, in this case, the only days that counted against the Speedy Trial clock was the period between the March 2 indictment and the March 31 order for a competency evaluation, totaling 28 days.  Therefore, there was no violation of Graves’s rights under the Speedy Trial Act.

Third Circuit Finds Defendant Was Not Seized Where He Briefly Paused and Raised Hands Before Fleeing

In United States v. Amos , ---F. 4th---, 2023 WL 8636910 (3d Cir. Dec. 14, 2023), the Third Circuit affirmed a district court's denial o...