Friday, March 4, 2016

D.C. Circuit Opinion in Sprawling NonTax Case (3/4/16)

My automated daily searches picked up this opinion, United States v. McGill, 2016 U.S. App. LEXIS 3734 (DC Cir. 2016), here.  It is not a tax crimes case.  Rather, it involved charges arising from an alleged conspiracy "to run a large-scale and violent narcotics-distribution" business. Here is the part pick up by the automated searches:
Finally, while the Alfreds, Simmons, and McGill object to evidence of their failure to pay taxes during the course of the conspiracy, "[i]t is well settled that in narcotics prosecutions, a defendant's possession and expenditure of large sums of money, as well as his or her failure to file tax returns, are relevant to establish that the defendant lacked a legitimate source of income and that, in all probability, the reason for the failure to report this income is due to the defendant's participation in illegal activities." United States v. Briscoe, 896 F.2d 1476, 1500 (7th Cir. 1990); see also United States v. Chandler, 326 F.3d 210, 215 (3d Cir. 2003) (same). 
That rationale holds true here. Simmons, McGill, and Ronald Alfred all suggested that they were operating a business or otherwise supporting themselves through legitimate means. Their failure to pay taxes thus was relevant to show that they were in fact getting income from illicit activities like drug trafficking that they assuredly did not want to report to the IRS. With respect to James Alfred, he failed to object to the tax-filing evidence in district court, and the court's failure to sua sponte exclude that evidence of his lack of a licit income source while in the drug conspiracy was not plain error. See United States v. Spriggs, 102 F.3d 1245, 1257 (D.C. Cir. 1996) ("Because appellants did not make a timely objection to [admitting evidence], we review its admission for plain error.").
I will let that reasoning stand for what it is.  Of course, if the inference sought is correct, the defendants could have been charged with a tax crime -- at least failure to file, § 7203.

Several other things about the case struck me.

1. The opinion is 178 pages long in the pdf format.  That is not your ordinary opinion.  The case was argued in February 2015, so there was a long time to produce the 178 pages (and of course, the judges and their clerks were working on other cases during the period).

2. Perhaps related to the first, the opinion is "per curiam."  Per curiam may mean a number of things, but one thing it does mean is that no single judge claimed authorship.  Perhaps it was a collaborative effort of the judges and the law clerks.

3. The opinion (at least parts of it) is an interesting read.  Readers who want to dig in might look at the following  which are the parts that particularly interested me (Paragraph numbers are the courts and page numbers supplied by me are to the pdf copy).

I. Removal of Juror  (pp. 4 - 28), regarding the removal of a rogue juror.

II. Government Overview Testimony (pp. 28 - 37), regarding the prosecution use of an initial "overview" witness -- here the FBI agent.  Referring to its holding in an earlier case related to the present one, the Court said:
We found that result to be highly problematic, and we therefore joined the other courts of appeals "that have addressed the issue in condemning" the government's use of overview witness testimony. Id. at 60. We noted that there were several "obvious" problems posed by the government's use of an overview witness. Id. at 56. "First, the jury might treat the summary evidence" from the overview witness "as additional or corroborative evidence that unfairly strengthens the government's case." Id. Second, the overview witness might serve as a conduit for the introduction of "otherwise inadmissible evidence." Id. And third, an overview witness "might permit the government to have an extra [opening] argument." Id. We also determined that the "[a]voidance of those dangers is largely beyond the ability of the district court, much less the defense." Id. at 60.
Nevertheless, the Court sustained that use on the plain error standard.

III. The Admission of "Other Crimes" Evidence (pp. 37 - 60).  This discusses the commonly encountered use of bad acts and the scope of FRE 403 and 404(b).  I won't get into the weeds of the particular facts, but the Court does open with the background for use of this type of evidence, particularly whether the evidence is intrinsic to the charged crimes and thus not within FRE 404(b):
Rule 404(b) generally bars the admission of "[e]vidence of a crime, wrong, or other act . . . to prove a person's character in order to show that on a particular occasion the person acted in accordance with the character." Fed. R. Evid. 404(b)(1). That same evidence, however, may "be admissible for another purpose, such as proving motive, opportunity, intent, preparation, plan, knowledge, identity, absence of mistake, or lack of accident." Fed. R. Evid. 404(b)(2). That means that, in practice, Rule 404(b) "does not prohibit character evidence generally, only that which lacks any purpose but proving character." United States v. Bowie, 232 F.3d 923, 930, 344 U.S. App. D.C. 34 (D.C. Cir. 2000). A prosecutor seeking to use evidence of other criminal or bad acts for one of those permitted purposes must, upon request, provide the defendant with reasonable notice, usually pretrial, of the anticipated evidence. Fed. R. Evid. 404(b)(2). 
A threshold question in determining the admissibility of evidence of other crimes and bad acts is whether the evidence, in actuality, relates to acts unconnected with those for which the defendant is charged, or instead is intertwined with the commission of charged crimes. Acts "extrinsic" to the crime charged are subject to Rule 404(b)'s limitations; acts "intrinsic" to the crime are not. See Bowie, 232 F.3d at 927; see also United States v. Mahdi, 598 F.3d 883, 891, 389 U.S. App. D.C. 374 (D.C. Cir. 2010). In other words, Rule 404(b) only applies to truly "other" crimes and bad acts; it does not apply to "evidence . . . of an act that is part of the charged offense" or of "uncharged acts performed contemporaneously with the charged crime . . . if they facilitate the commission of the charged crime." Bowie, 232 F.3d at 929. 
In conspiracy prosecutions, the prosecution is "usually allowed considerable leeway in offering evidence of other offenses 'to inform the jury of the background of the conspiracy charged . . . and to help explain to the jury how the illegal relationship between the participants in the crime developed.'" United States v. Mathis, 216 F.3d 18, 26, 342 U.S. App. D.C. 127 (D.C. Cir. 2000) (quoting United States v. Williams, 205 F.3d 23, 33-34 (2d Cir. 2000)). In addition, "where the incident offered is a part of the conspiracy alleged[,] the evidence is admissible under Rule 404(b) because it is not an 'other' crime." United States v. Hemphill, 514 F.3d 1350, 1357, 379 U.S. App. D.C. 441 (D.C. Cir. 2008) (quoting United States v. Mejia, 448 F.3d 436, 447 (D.C. Cir. 2006)). We have also permitted the introduction of "other acts" evidence in conspiracy cases (i) to link a defendant to other defendants and drug transactions for which the conspiracy was responsible, United States v. Gaviria, 116 F.3d 1498, 1532, 325 U.S. App. D.C. 322 (D.C. Cir. 1997); (ii) to show the nature of a conspiracy and "the kind of organizational control" a defendant exercised, Mahdi, 598 F.3d at 891; and (iii) to show the defendants' intent to act in concert, Mathis, 216 F.3d at 26; see also United States v. Straker, 800 F.3d 570, 590 (D.C. Cir. 2015) (evidence of uncharged hostage takings was "relevant to . . . how those defendants started to work together as kidnappers"). 
However, in defining the contours of intrinsic evidence that is not subject to Rule 404(b), we have rejected the rule embraced by some of our sister circuits that evidence is intrinsic if it "complete[s] the story" of the charged crime. Bowie, 232 F.3d at 928 (citing United States v. Hughes, 213 F.3d 323, 329 (7th Cir. 2000); United States v. Carboni, 204 F.3d 39, 44 (2d Cir. 2000)). That is because "all relevant prosecution evidence explains the crime or completes the story" to some extent, and the fact that "omitting some evidence would render a story slightly less complete cannot justify circumventing Rule 404(b) altogether." Bowie, 232 F.3d at 929. Instead, if the government wishes to introduce such "other crimes" evidence, we "see no reason to relieve the government and the district court from the obligation of selecting from the myriad of non-propensity purposes available to complete most any story." Id. 
Beyond Rule 404(b)'s specific limitations on the admission of prior bad acts, Federal Rule of Evidence 403 permits a court to exclude otherwise-relevant evidence "if its probative value is substantially outweighed by a danger of . . . unfair prejudice, confusing the issues, misleading the jury, undue delay, wasting time, or needlessly presenting cumulative evidence." Fed. R. Evid. 403. As relevant here, this court has recognized that "[e]vidence of other crimes or acts having a legitimate nonpropensity purpose," and thus unaffected by Rule 404(b), may nevertheless "contain the seeds of a forbidden propensity inference." Bowie, 232 F.3d at 931. As a result, Rule 403's balancing of prejudice and probativeness may still bar the introduction of evidence, even if Rule 404(b) by itself would not. Id.; see also Mathis, 216 F.3d at 26. 
We review the district court's admission of evidence under both Rule 403 and Rule 404(b) for an abuse of discretion. See United States v. Johnson, 519 F.3d 478, 483, 380 U.S. App. D.C. 218 (D.C. Cir. 2008) (Rule 404(b)); United States v. Clarke, 24 F.3d 257, 265, 306 U.S. App. D.C. 251 (D.C. Cir. 1994) (Rule 403). This court is "extremely wary of second-guessing the legitimate balancing of interests undertaken by the trial judge" in this context. United States v. Ring, 706 F.3d 460, 472, 403 U.S. App. D.C. 410 (D.C. Cir. 2013) (quoting Henderson v. George Washington Univ., 449 F.3d 127, 133, 371 U.S. App. D.C. 173 (D.C. Cir. 2006)). An erroneous admission of "other crimes" evidence must be disregarded as harmless error unless it had a "substantial and injurious effect on the jury's verdict." United States v. Clark, 747 F.3d 890, 896, 409 U.S. App. D.C. 160 (D.C. Cir. 2014) (quoting Kotteakos v. United States, 328 U.S. 750, 776, 66 S. Ct. 1239, 90 L. Ed. 1557 (1946)) (ellipsis and brackets omitted).
I note also that there is a subsequent discussion of bad acts used for impeachment (X. Impeachment with Prior Bad Acts (McGill), pp. 93-99).

XVII. Prosecutorial Misconduct During Closing and Rebuttal Arguments (pp. 118 - 126).  The Government made closing arguments based on inferences from facts not in evidence.  The Court said:
The government now concedes that the playbook theme's implication "that appellants, their counsel, or the defense witnesses had consulted the letters seized from Andrews' cell in formulating the defense strategy . . . was without any factual basis," Appellee's Br. 221-22, and the argument was "in some respects, ill-advised," id. at 221. 
"Ill-advised" indeed. The prosecution's argument theme and statements were entirely improper, unprofessional, and wholly unbefitting of those who litigate in the name of the United States of America. There was no evidentiary basis for even inferring, let alone repeatedly trumpeting, that appellants knew anything about Andrews's letters. See United States v. Valdez, 723 F.3d 206, 209, 406 U.S. App. D.C. 183 (D.C. Cir. 2013) (prosecutor's remarks were improper where there was "no factual basis" for them). Worse still, under our Constitution, prosecutors have no business in gratuitously maligning as lies, falsehoods, and corruption, without any evidentiary basis, the defendants' exercise of their Fifth and Sixth Amendment rights to present a defense in court. Cf. United States ex. rel. Macon v. Yeager, 476 F.2d 613, 615 (3d Cir. 1973) (prosecutor may not seek to raise in the jurors' mind an inference of guilt from the defendant's exercise of his Sixth Amendment rights). 
Prosecutors "ha[ve] an obligation 'to avoid making statements of fact to the jury not supported by proper evidence introduced during trial,'" Moore, 651 F.3d at 51 (quoting Gaither v. United States, 413 F.2d 1061, 1079, 134 U.S. App. D.C. 154 (D.C. Cir. 1969)), and this court expects prosecutors to litigate with the recognition that they represent "a sovereignty whose obligation to govern impartially is as compelling as its obligation to govern at all," Berger v. United States, 295 U.S. 78, 88, 55 S. Ct. 629, 79 L. Ed. 1314 (1935). A just outcome obtained through a fair, even-handed, and reliable process should be the government's goal; it is not to win at any cost. 
District courts, too, must remain vigilant. While counsel may be afforded a long leash in closing argument, they should not be given free rein. Courts must stand in the gap to protect defendants and the judicial process from abusive arguments like this. That did not happen here. Appellants repeatedly objected, and "[w]hy the [166]  district court refused to sustain the defense objection[s] is beyond us," Maddox, 156 F.3d at 1283. "When a prosecutor starts telling the jury" that the defendants, their lawyers, and some of their witnesses all consulted the same letters—a so-called playbook for a false defense—without any factual basis to support that argument, "it is time not merely to sustain an objection but to issue a stern rebuke and a curative instruction, or if there can be no cure, to entertain a motion for a mistrial." Id. Instead, the district court wrongly, and without explanation, denied appellants' repeated objections to this blatantly impermissible closing argument. 
While we find the closing argument to be deeply troubling, we cannot conclude on the record of this case that it actually resulted in substantial prejudice. "[T]here was overwhelming evidence of appellants' guilt," Moore, 651 F.3d at 53; the "case was not close," Becton, 601 F.3d at 599. In addition, the playbook theme was not mentioned in the government's initial closing argument, and was primarily confined to the first hour of the three hour rebuttal argument. The misconduct was thus limited "to relatively small portions of lengthy . . . closing [and rebuttal] arguments." Moore, 651 F.3d at 54. Just as a short and simple trial can make a "prosecutor's improper remarks all the more potent," Maddox, 156 F.3d at 1283, here the length of the trial (nearly six months) and the relatively cabined nature of the improper conduct mitigated any possible prejudice to appellants. 
Finally, the district court specifically instructed the jury right before it began deliberating that "[t]he opening statements and closing arguments of counsel are also not evidence," J.A. 5450; see Moore, 651 F.3d at 53-54. Such an instruction "is usually a strong ameliorative consideration" when evaluating "prosecutorial misconduct during . . . closing argument[.]" Id. at 54 (citations omitted).

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