Down to the Wire (Application)
The U.S. Court of Appeals for the Second Circuit in United States v. Goffer examined what to do
when the government uses a wiretap to investigate crimes that are
not enumerated in the Wiretap Act as predicates for obtaining a
wiretap. Title III of the Omnibus Crime Control and Safe Streets
Act, 18 U.S.C. §§ 2510 et seq., lists certain predicate
crimes for which wiretap orders may be issued. Wire fraud is listed
among them; securities fraud is not. The statute allows evidence of
nonpredicate offenses to be used in a subsequent prosecution in the
absence of bad faith. Goffer stemmed from the investigation into
securities fraud in connection with the Galleon Group cases. The
government convicted the defendants in part on the strength of
wiretap evidence, even though they were charged with
securities-fraud offenses, but not wire-fraud offenses. The
defendants unsuccessfully sought to exclude the wiretap evidence in
the district court. After their convictions, they appealed, arguing
the wiretap evidence should have been excluded for two reasons: (1)
securities fraud is not a predicate under Title III, and (2) any
interceptions of nonpredicates can be admitted only if they were
inadvertent. The court of appeals rejected these arguments. In so
doing, it noted that the government's wiretap applications were
premised on a wire-fraud investigation, but noted that "they
expected to uncover evidence of securities fraud (which, they
expressly noted, is 'not a predicate offense under 18 U.S.C.
§ 2516')." This language, the court reasoned, ensured
there was no "'subterfuge'" in obtaining the
wiretap authorizations.
Reprieve Resulting from Skilling Is Not a Slam
Dunk
In United States v. Caso, the D.C. Circuit
vacated the conviction of former congressional aide Russell James
Caso, Jr., who had pleaded guilty to honest-services wire fraud. In
2005, a consulting firm had solicited Caso's boss in the House
of Representatives to take legislative action on two proposals. The
firm then hired Caso's wife to work on those proposals and paid
her $19,000 over the course of a few months for de minimis
services. As a congressional employee, Caso was required to file a
form to report his wife's income over $1,000. He did not
include her income on the form, even though he swore under the
penalties of perjury that the form was accurate. After being
charged with wire fraud on an honest-services theory, Caso pleaded
guilty. After the U.S. Supreme Court's ruling in Skilling v.
United States, Caso sought to vacate his conviction. Caso argued he
was "actually innocent" of wire fraud, which excused his
procedural default on his habeas petition for not raising the issue
on direct appeal. But to avoid the procedural default, one must
show "actual innocence" on not only the offense of
conviction, but also any other more serious offense the government
might have forgone in agreeing to the plea bargain. The district
court held Caso did not satisfy the conditions of "actual
innocence" because he had not shown he was actually innocent
of "not only the crime for which he was charged and convicted
. . . but also of the separate, uncharged offense of making a
'materially false . . . statement' to the government."
Reasoning that the false-statement charge was less serious than the
wire-fraud charge, the court of appeals reversed, holding that Caso
was not required to prove "actual innocence" with respect
to both. The court held that to determine whether the uncharged
crime was more serious than the charged crime, courts should look
to the potential penalties under the U.S. Sentencing Guidelines as
well as the underlying statutes.
Foreign Forfeiture Fun
The D.C. Circuit's opinion in Luan v. United States waded into the murky
waters of interpreting 28 U.S.C.
§ 2467(d)(3). That statute authorizes federal courts to
issue orders to restrain property in the United States at the
request of foreign governments to "preserve the availability
of property subject to civil or criminal forfeiture under foreign
law." The statute also directs that a court can issue the
restraining order only if the foreign claimant has the same due
process protections as would a domestic claimant were the United
States seeking a restraining order under 18 U.S.C. § 983(j). In Luan, a magistrate
in Hong Kong had issued an arrest warrant for the claimant and an
order restraining the proceeds of his alleged smuggling operation,
which amounted to some $23 million. Hong Kong asked the United
States to restrain the claimant's U.S. assets. The district
court issued the restraining order, and Luan appealed, claiming
that the restraining order was improperly issued because it was not
"issued in a manner consistent with the procedural due process
protections of § 983(j)(1)(A)." The issue before the
court was whether Hong Kong's actions provided the protections
required by due process. The court of appeals affirmed the
restraining order, holding that whatever the requirements of
§ 2467(d)(3) were, the claimant's due process was
adequately protected by the filing of the Hong Kong arrest warrant,
the restraining order and the adversarial hearing.
Government Forms Don't Amount to Business
Records
The Ninth Circuit in United States v. Morales held that government
immigration forms could not be admitted as business records under
Federal Rule of Evidence 803(6), which excepts
such out-of-court statements from the normal hearsay bar. Morales
had been driving five illegal aliens who were secreted in her truck
in Arizona. When she was stopped by the police, the aliens were
discovered. Upon their arrest, each was presented with immigration
form I-826, on which each admitted to his or her illegal status and
requested deportation. Morales was arrested and charged with
various offenses relating to the illegal transportation of aliens.
At her trial, the government was allowed to introduce into evidence
the forms I-826 as business records to establish that each of the
passengers was, in fact, an alien. After her conviction, Morales
appealed, claiming these forms were improperly admitted because
they were not business records. The court of appeals agreed,
holding that because the I-826s were government forms, their
admissibility is governed by Rule 803(8), not 803(6), and they
failed to satisfy that rule. Alas, the conviction was left
unmolested because the court found the error was harmless.
Not Guilty, But Hardly Innocent
The Seventh Circuit in Pulungan v. United States clarified that a
judgment of acquittal is not the same as a finding of innocence. In
this case, Doli Syarief Pulungan had been prosecuted for attempting
to export defense articles without a license in violation of 22 U.S.C. § 2778. He spent 23 months in
prison both pretrial and after the jury conviction for the offense.
On appeal, the Seventh Circuit vacated the judgment, holding there
was insufficient evidence to show beyond a reasonable doubt that
Pulungan knew a license was required. After his release from
incarceration, he sought from the district court a certificate of
innocence under 28 U.S.C. § 2513, which would allow
Pulungan to obtain compensation under 28 U.S.C. § 1495 for the period of his
incarceration. The district court gave him the certificate, ruling
that the court of appeals opinion showed he was innocent. The
United States appealed, and the Seventh Circuit made plain that a
finding of insufficient evidence to support a conviction is not a
finding of innocence for the purposes of § 2513. As the court
put it, "[a] conclusion that the prosecutor did not prove a
charge beyond a reasonable doubt differs from a conclusion that the
defendant is innocent in fact." The court also proffered its
view of Pulungan's case by concluding, "[h]e is now the
plaintiff in civil litigation, so the burdens of production and
persuasion are his. If he decides not to testify, that would be a
good basis for an adverse inference."
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.