Friday, April 15, 2011

Summary Summary

Here are four recent summary orders of interest.

In United States v. Durham, No. 10-1046-cr (2d Cir. April 12, 2011), a supervised release violation case, the defendant claimed that his CJA lawyer was ineffective due to a conflict of interest. The circuit observed that in a VOSR the right to counsel is "statutory, not constitutional," and thus that "the scope of [the] right to effective assistance of counsel is arguably an open question in our Circuit." In the end, however, the court did not resolve the question because the factual basis for the conflict of interest claim was not sufficiently developed.

In United States v. Monk, No. 09-3618-cr (2d Cir. April 11, 2011), the court vacated a drug sentence because the district court's findings of fact were insufficient to support the imposition of the two-level gun enhancement. The court relied on evidence that the defendant had possessed guns in the past, and that ammunition was seized at the time of his arrest. The circuit agreed that this evidence, although it proved that "Monk at some point possessed a gun," failed to "establish the necessary connection between the gun and the offense conduct" and that to affirm the enhancement on these facts would "be expanding [its] scope ... in an unprecedented manner."

In United States v. Shay, No. 10-1543-cr (2d Cir. April 6, 2011), the court vacated a long, but within-Guideline, child pornography sentence because the district court "did not have the benefit of" Dorvee when the sentence was imposed, and the "Guidelines calculation and offense conduct in Dorvee's case were strikingly similar to those" here. This similarity made it "appropriate, at a minimum, to vacate the judgment and remand" so that the "district court can consider the potential effect or Dorvee on this case in the first instance," and decide whether the sentence it originally imposed remains appropriate.

Finally, in United States v. Windle, No. 10-620-cr (2d Cir. April 5, 2011), the court found plain error in an illegal restitution order. The district court improperly imposed a "lump sum" restitution order without identifying the victims or their actual losses.

Saturday, April 02, 2011

PC World

United States v. Perez-Frias, No. 10-1401-cr (2d Cir. March 31, 2011) (Jacobs, Calabresi, Lohier, CJJ) (per curiam)

Pedro Ruben Perez-Frias appealed his 42-month, below-Guideline illegal reenty sentence, arguing that it was substantively unreasonable. The circuit affirmed.

His case presented a particularly unsympathetic set of facts. In 1995, Perez-Frias was convicted of a drug-related manslaughter. He was selling marijuana at the time, and told his friends that he was having trouble with a rival dealer. This inspired someone else to kill the rival. Perez-Frias received a 7-to-21-year state sentence, and served about 14 years before being paroled to immigration authorities, who immediately deported him. He returned to the United States in August of 2009 and, two months later, was arrested for possessing marijuana. Within a few months he was in federal custody facing an illegal reentry charge.

Perez-Frias’ primary argument at sentencing was that a Guideline sentence was greater than necessary to satisfy § 3553(a). The sentencing judge disagreed, but granted his request for a four-month reduction to account for the uncredited time that Perez-Frias was in federal custody on a writ. The Guideline range was 46 to 57 months’ imprisonment, and the court imposed a 42-month term.

The circuit began by noting that it is “difficult to find that a below-Guidelines sentence is unreasonable,” although, in context, it seems that the court will find this difficulty only when assessing a defendant’s claim that the sentence is unreasonably high, and not when assessing a prosecutor’s claim that a below-Guideline sentence is unreasonably low. Here, according to the circuit, the district court’s assessment of the nature and circumstances of the offense and the defendant’s history and characteristics supported the sentence it chose.

Perez-Frias challenged the 16-level enhancement that he received for the manslaughter conviction as one not supported by “specific empirical data.” This is a common argument made in illegal reentry cases, and here the court pretty much shot it down. There is “no such flaw in the reentry Guideline.” Rather, the 16-level enhancement was “based on the Commission’s own determination that these increased offense levels are appropriate to reflect the serious nature of these offenses.”

Relatedly, Perez-Frias argued that the 16-level enhancement was unduly harsh because the illegal reentry itself is a non-violent act. The court rejected this, too. The guideline is not unreasonable merely because it produces an offense level that is equal to or greater than that of certain violent crimes.

Finally, Perez-Frias deployed another commonly raised argument: that the lower sentences imposed in “fast-track” districts showed that non-fast-track sentences are longer than necessary to achieve the statutory goals. The circuit disagreed because “defendants in fast-track districts are not similarly situated to defendants in non-fast-track districts.”


For those with a lot invested in illegal reentry cases - like federal defenders - this is a disturbing opinion, particularly on the issue of the empirical basis for the 16-level bump.

There has been a lot written, much of it quite compelling, that establishes that the Commission’s choice of 16-level bump was, in essence, random, and was not based on any systematic empirical study. And the quoted material that the court relies on here to find otherwise is not really an answer. That material comes from the Commission’s justification for the enhancement, and establishes only that the Commission believed that illegal reentrants with serious past convictions deserved a higher offense level. But it does nothing to explain why the Commission selected 16 levels, and not some lower number, and certain does not in any way show that the number, or even the concern behind it, was the product of a real empirical - or indeed any - investigation.

Others have observed that the 16-level bump seems to have been intended to coordinate with the statutory maximum of twenty years. But under Kimbrough that is an additional reason to give less deference to a determination by the Sentencing Commission. This opinion does not address that aspect of the enhancement at all.

Finally, as for fast-track, there is an issue that the Circuit has had before it many times but has not yet resolved: the claim that the disparity between the sentences imposed in fast-track districts and non-fast track districts is “unwarranted” under 18 U.S.C. § 3553(a)(6). Although the government will likely trot out this case in answer to that argument, in fact, this case does not shut that particular door. Its holding that the fast-track disparity does not render non-fast-track sentences longer than necessary is not a holding that such disparities can never be “unwarranted.”

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Pill Pains

United States v. Quinones, No. 09-4361-cr (2d Cir. March 29, 2011) (Walker, Straub, Katzmann, CJJ)

Antonio Quinones and his son, Herman, were convicted of conspiring to distribute controlled substances. Antonio was also convicted of a money laundering conspiracy. In this opinion, the Court tries to make sense of a confusing Supreme Court money laundering case and displays a rare difference of opinion over a conscious avoidance jury instruction.


Antonio Quinones entered the internet pharmacy business in 2002 and, for several years, ran websites where customers could purchase prescription drugs with virtually no medical oversight. The purchaser would select the drug he wanted and fill out a brief medical questionnaire. This was then submitted to a doctor who reviewed it and approved the order. The doctors were paid per questionnaire reviewed, and often reviewed more than one hundred per day. Once approved, the prescription was transmitted to an actual pharmacy that Antonio controlled and the medicine was shipped out. Typically, he would send out one thousand orders per day.

Herman’s role was more limited - he filled orders and ran the customer service call center. Eventually, he developed his own “back end” administrative website to help Antonio process payments.

An Eastern District jury convicted them both; the court sentenced Herman to eighteen months’ imprisonment and Antonio to ninety-seven.

The Appellate Court’s Decision

Money Laundering

Taking the issues in reverse order, here the court was required to sort out the confusing array of opinions relating to money laundering in United States v. Santos, 553 U.S. 507 (2008). In Santos, which involved an illegal gambling operation, a four-justice plurality applied the rule of lenity and concluded that the term “proceeds” in the money laundering statute means profits, not gross receipts. The plurality was concerned that if the definition of “proceeds” were not limited to profits, the money laundering would “merge” with the crime of running an illegal gambling business because the essence of the business itself, taking money from bettors and paying the winners, would also be money laundering transactions.

Here, Antonio argued that, under Santos, his money laundering conviction likewise could not stand because his case presented the same “merger problem.” The circuit, addressing a question of first impression, held that Santos does not apply to money laundering offenses that derive from the sale of contraband.

But getting there involved a very detailed look at Santos. The fifth vote in that case came from Justice Stevens, who held that the meaning of the term “proceeds” depended upon the nature of the underlying criminal conduct. His view of the legislative history of the money laundering statute was that Congress intended it to apply to the gross revenues, and not just the profits, of certain other activities, including “the sale of contraband.” The four justices who dissented would have held that the term “proceeds” means “gross receipts” in all circumstances. Accordingly, the circuit, in trying to identify the scope of Santos, looked to the “position taken by those Members [of the Court] who concurred in the judgment on the narrowest grounds.” Some circuits have limited Santos to its facts, while others have indicated that Santos applies more broadly, to any case that presents a “merger problem.”

Here, the court concluded that the Stevens concurrence determined the scope of Santos and thus that the statutory term “proceeds” includes “gross revenue from the sale of contraband.” It accordingly affirmed Antonio’s money laundering conviction.

Conscious Avoidance

To convict the defendants of unlawful distribution of controlled substances, the jury was required to find that they either knew or “reasonably should have known” that their doctors and pharmacists were acting in bad faith; that is, “outside the usual course of professional practice and without a legitimate medical purpose.” Their defense was good faith reliance on the determinations of the doctors and pharmacists. Here, the district court gave a conscious avoidance charge but the charge neglected to mention that the concept of conscious avoidance did not apply if the jury found that the Quinoneses actually believed that the doctors and pharmacists were acting in good faith.

A two-judge majority held that the error was harmless because defendants’ “actual but unreasonable belief in the existence of ... the doctors’ and pharmacists’ good faith” could not absolve the defendants of culpability.

The government introduced “overwhelming evidence that the defendants knew or reasonably should have known that the doctors and pharmacists on whom they relied were acting in bad faith.” The defendants knew that their internet pharmacies permitted no interaction at all between a customer and a doctor. In fact, days after Florida enacted a law prohibiting Florida doctors from writing prescriptions without physically consulting with their patients, Antonio moved his filling pharmacy to New York. Moreover, he regularly changed locations as law enforcement raided or shuttered his pharmacies. Antonio was also aware that someone else in the same business had been arrested and that federal agents had informed some of his employees that his internet pharmacies were illegal.

Accordingly, the majority affirmed on this point as well.

Judge Straub vigorously dissented. In his view, the flawed language of the instruction required a new trial. The “actual belief” language is critical to the conscious avoidance instruction. “When knowledge of the existence of a particular fact is an element of an offense, such knowledge is established if a person is aware of high probability of its existence, unless he actually believes that it does not exist.” This language “must be incorporated into every conscious avoidance charge” and is particularly important in cases like this one, where the defendant “relied on his lack of knowledge of a crucial fact as a central element of his defense.” The conscious avoidance charge here was “completely silent on the Quinones’ actual beliefs” and thus was “wholly deficient and clearly erroneous.”

Judge Straub also found the error to be prejudicial. First, he disagreed with the majority’s premise that the Quinones’ actual but unreasonable belief in the doctors’ and pharmacists’ good faith could not absolve them. In his view, if the jury found that the Quinoneses actually believed that the doctors and pharmacists were acting in good faith, it could not have convicted them on a conscious avoidance theory.

Judge Straub also found significant evidence that the Quinoneses did indeed believe that the doctors and pharmacists were acting in good faith. Antonio testified; he explained the steps he took to ensure that his business was legal, and asserted that he actually believed that the doctors and pharmacists were acting in good faith. He also consulted with an attorney, who conducted an investigation and advised him that the businesses were legal. He moved his business out of states where it was not legal, and had a “block list” to prevent drug abusing customers from repeatedly purchasing pills.

Judge Straub also disagreed with the majority that there was “overwhelming evidence” that the Quinoneses should have known that the practitioners were acting in bad faith. The record here contained “conflicting testimony as to what the Quinoneses knew and believed,” as well as “clear evidence that Antonio consulted with both the doctors [and] attorneys about whether his business was legal.” Accordingly, “a jury should determine whether the Quinoneses are guilty after hearing a proper jury charge.”

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