Justia Criminal Law Opinion Summaries

Durham, Cochran, and Snow took control of Fair Finance Company, a previously well-established and respected business, and used money invested in Fair to support their lavish lifestyles and to fund loans to related parties that would never be repaid. When auditors raised red flags, the auditors were fired. When Fair experienced cash-flow problems, it misled investors and regulators so it could keep raising capital. One of the company’s directors, under investigation in a separate matter, alerted the FBI that Fair was being operated as a Ponzi scheme. The FBI seized Fair’s computer servers and, after an investigation uncovered more than $200 million in losses to thousands of victims, many of them elderly or living on modest incomes, arrested the three. A jury convicted them of conspiracy, securities fraud, and wire fraud. The Seventh Circuit affirmed, except with respect to Durham’s wire fraud convictions. The government failed to enter into the trial record key documentary evidence supporting those counts. The court rejected arguments relating to sufficiency of the evidence; sufficiency of the wiretap application; the court’s refusal to give a proposed theory-of-defense jury instruction on the securities fraud count; alleged prosecutorial misconduct during the rebuttal closing argument; and claimed sentencing errors. View "United States v. Durham" on Justia Law

After being caught establishing a fraudulent worker’s compensation insurance program, , Neal was convicted of wire fraud, 18 U.S.C. 1343, and sentenced to 327 months’ imprisonment. He is incarcerated in Terre Haute, Indiana. Prison administrators discovered that he had signed a court document with an alias. They disciplined him for violating a prison rule which forbids forging any document, identification, money, or official paper by revoking his commissary and telephone privileges for 180 days. Neal sought a writ of habeas corpus, 28 U.S.C. 2241, claiming denial of due process. Neal moved three times to stay proceedings and compel arbitration, submitting a purported arbitration agreement, executed by a representative of the Bureau of Prisons and himself, under his assumed name. The district court denied the motion, noted that the only penalties Neal suffered were the loss of privileges, neither of which affected custody, so that relief under section 2241 was unavailable. The Seventh Circuit affirmed, stating that there is no basis for an arbitration claim. Neal's documents are obvious fabrications and the Federal Arbitration Act governs only maritime contracts and contracts involving interstate commerce. The court imposed an additional fine of $500 on Neal. Until he pays all outstanding fees and sanctions, clerks of all federal courts within the circuit must return unfiled any papers he submits in any habeas corpus action unless the petition attacks a state-court criminal judgment. The court also ordered Neal to show cause why not to sanction him under FRAP 38 for filing a frivolous appeal and forwarded the file for consideration of prosecution for perjury. View "Neal v. Oliver" on Justia Law

Contending that a guard had assaulted him during a pat-down by inserting a finger in his anus, inmate Rivera filed suit under 42 U.S.C. 1983. Drake, the guard, moved to dismiss because Rivera had failed to exhaust administrative remedies. Rivera provided an affidavit claiming to have filed an administrative complaint on the day after the alleged assault. The judge granted summary judgment to the guard, deeming the events too trivial to justify damages. The Seventh Circuit reversed. On remand, Rivera testified that he had filed a written grievance. The judge found that the affidavit and testimony were false. Prison records contained more than 100 of Rivera’s grievances, but none relating to assault during a pat-down until August 2009. Rivera conceded in that grievance (which did not mention Drake) that it was untimely and had been filed only “for exhaustion purposes”. Prison officials testified about how grievances are collected and recorded; the judge concluded that there was little chance that a written grievance would be lost. The judge observed that Rivera’s initial allegation had been that he made an oral complaint, not a written grievance. The court dismissed, concluding that by committing perjury Rivera had forfeited his claim. The Seventh Circuit affirmed and issued an order requiring Rivera to show cause why it should not revoke his privilege of litigating in forma pauperis and imposing financial sanctions that, if unpaid, will lead to the entry of a litigation-control order. “Rivera has made deceit the norm in his litigation. He is a frequent plaintiff, and many of his suits entail dissembling.” View "Rivera v. Drake" on Justia Law

At a supervised release revocation hearing, the key substantive evidence against Jordan was a report prepared by a Texas State Trooper (Wilson) who arrested Jordan after a traffic stop. His report said that Jordan had been driving a car containing nearly 30 pounds of marijuana. The court admitted the hearsay report over Jordan’s objection and relied upon it to return Jordan to prison. The Seventh Circuit reversed because the court admitted the report without making a finding about the interest of justice under FRCP 32.1(b)(2)that could have excused the failure to allow the defendant to cross-examine the trooper. On remand, Wilson testified via two-way video conference and confirmed the events described in the police report. The government also introduced a forensic laboratory report confirming that the leafy green substance found in Jordan’s car was marijuana. Wilson testified that the report was the same one that the lab had provided to him. The district court overruled Jordan’s objection, saying that such reports are generally considered reliable and imposed the original sentence of 24 months in prison and no additional supervised release, within the guideline range for a Grade A supervised release violation of 18 to 24 months for Jordan’s criminal history. The Seventh Circuit affirmed, rejecting challenges to the testimony by video conference and to admission of the report. View "United States v. Jordan" on Justia Law

In 2004 Miller was charged with First Degree Sexual Assault of a Child. Miller entered a plea of no contest and was sentenced to 10 years in prison. In 2006, Miller filed notice of intent to pursue post-conviction relief, alleging that he failed to understand his original plea. The court appointed Grau to represent Miller. Grau filed a post-conviction motion. Miller, however, withdrew the motion during an April 2007 hearing. In May, Grau informed Miller that Grau felt there was no legal basis for pursuing post-conviction relief. Miller did not hear back from Grau for months and wrote to the State Public Defender’s Office, which wrote back that the Office “will not appoint successor counsel when a defendant disagrees with the legal conclusions of appointed counsel or wants a second opinion as to the merits of an appeal” and informed Miller that he could proceed pro se, hire a different attorney at his own expense, or direct Grau to file a no-merit report. Miller directed Grau to file a no-merit report; Grau failed to do so. In January, 2008, Miller filed a pro se petition for habeas corpus in a Wisconsin court, arguing ineffective assistance of appellate counsel. The court granted Miller’s petition and advised Miller to seek assistance from the State Public Defender. Miller never did so. Miller petitioned the Wisconsin Supreme Court. After additional proceedings and disputes, Miller proceeded pro se and unsuccessfully sought federal habeas relief. The Seventh Circuit affirmed. The Wisconsin court’s denial of Miller’s request for new appellate counsel was not clearly contrary to or an unreasonable application of clearly established federal law and his challenge to the validity of his plea was procedurally defaulted. View "Miller v. Smith" on Justia Law

Twenty three members of the Almighty Latin Kings Nation were indicted, prosecuted, and sentenced for their roles in a major drug trafficking ring, linked 19 homicides. Anaya did not appeal his conviction but challenged the enhancement of his sentence based on a finding that Anaya killed Campos, conduct for which he had been acquitted, and the drug quantity attributed to his conspiracy to traffic narcotics conviction. The Seventh Circuit remanded for correction of an error in the judgment, but affirmed the sentence. The recommended sentence for Anaya was life, and he received 360 months. Gonzalez, Bernal, and Reyes pleaded guilty and waived their rights to appeal their convictions and sentences on all grounds except for a claim of “ineffective assistance of counsel relate[d] directly to th[e] waiver or its negotiation.” Appointed counsel for Gonzalez and Bernal concluded that appeal was frivolous. Their clients did not respond to their Anders briefs and the court allowed them to withdraw. Reyes’ counsel argued that the district court failed to have a sufficient colloquy with Reyes before accepting his guilty plea. Rejecting the claim, the Seventh Circuit stated that the lone fact that a defendant responds to the court’s questions with only “yes” or “no” answers does not defeat the presumption that his answers were truthful and that he actually understood the consequences of changing his plea to guilty, noting that Reyes has a master’s degree and speaks fluent English. View "United States v. Bernal" on Justia Law

Chicago police saw Chapman carrying a bag with what looked like the barrel of a rifle protruding from it. As officers approached, Chapman ducked into an abandoned duplex. An officer followed Chapman and saw him drop the bag in the living room; another caught Chapman as he tried to escape through a window. In the bag they found a distribution quantity of heroin and an assault rifle. Chapman was charged with possessing heroin with intent to distribute, possessing a firearm in furtherance of a drug-trafficking crime, and possessing a firearm as a felon. The jury returned a factually inconsistent verdict, convicting Chapman of possessing the drugs but acquitting him on the gun-possession counts. The Seventh Circuit vacated the conviction because the judge erroneously admitted details of his prior heroin-trafficking conviction for the purpose of proving that he knew how heroin is packaged and intended to distribute the drugs. The relevance to those issues depends entirely on a forbidden propensity inference. Even if the evidence was relevant in a nonpropensity way, its probative value was substantially outweighed by the risk of unfair prejudice given that Chapman’s defense was that he did not possess the bag. The error was not harmless. The judge also erroneously precluded him from explaining his six prior felony which had been admitted for impeachment purposes. Chapman wanted to blunt the impact by telling the jury that he had pleaded guilty and accepted responsibility in his earlier cases. The judge properly refused to compel the testimony of an eyewitness who might have supported his version of events. The witness was facing drug charges in a separate case and invoked his Fifth Amendment privilege against self-incrimination. View "United States v. Chapman" on Justia Law

Brothers Daniel and John owned four companies that offered remodeling services to homeowners. They provided honest work on construction jobs for cash customers, but duped numerous people into refinancing their homes and paying the loan proceeds directly to their companies, then left the jobs unfinished. They targeted neighborhoods on the South and West sides of Chicago, using telemarketers who looked for “elderly, ignorant homeowners,” and had customers sign blank contracts. They referred homeowners to specific loan officers and required the homeowners to sign letters of direction, so the title companies sent checks directly to the companies. From 2002 to 2006, the brothers collected about $1.2 million from more than 40 homeowner-victims. They were convicted of wire fraud, 18 U.S.C. 1343. The district court found that the loss calculation was more than $400,000 but less than $1,000,000 and accordingly increased the offense level, then applied enhancements because the conduct involved: vulnerable victims; violation of a prior court order; sophisticated means; mass-marketing; and leadership or organization of the scheme. The district court sentenced each brother to 168 months’ imprisonment. The Seventh Circuit affirmed. The district court reasonably estimated the amount of loss and properly enhanced the offense level further for the other five aggravating factors View "United States v. Sullivan" on Justia Law

The family of Johnson’s girlfriend told police that after an argument, Johnson had returned to their home, wearing all black and pointing a gun. Johnson was not present when police arrived at the home, searched the alley, and discovered an Intratec TEC-9 handgun, its loaded high-capacity magazine, and a dark work glove a short distance from the house. Shortly thereafter, police stopped the vehicle in which Johnson, his girlfriend, and another man were riding. The police saw marijuana in the car. Johnson admitted possessing drugs and was arrested. Johnson was convicted as a felon in possession of a firearm, 18 U.S.C. 922(g). The Seventh Circuit affirmed the district court’s application of a four-level enhancement to his sentence under U.S.S.G. 2K2.1(b)(6)(B) for possessing a firearm on another’s property in connection with another felony. The court reversed and remanded that part of the sentence imposing conditions that were not orally announced at Johnson’s sentencing hearing and directed the district court to clarify Johnson’s conditions for supervised release.View "United States v. Johnson" on Justia Law

In 2003, Smith, serving a 90-year sentence for murder, walked behind another inmate and stabbed him several times with scissors. The victim required surgery and was in the hospital for 12 days. The attack was observed by several guards. Facing charges for attempted murder and aggravated battery in LaPorte County, Smith had a court-appointed public defender, Cupp. Smith himself composed numerous motions, which Cupp believed were meritless and did not file. During the next several months, Smith repeatedly complained about Cupp and attempted to act pro se. The trial proceeded over his objections Smith was convicted and sentenced to 34 years in prison, to be served consecutively to his current term. On direct review, the Indiana court of appeals held that “[d]efense counsel did not, for all practical purposes, mount a defense on Smith’s behalf” because he cross-examined only one witness and called none in defense, while objecting only to one potential prosecution exhibit, but that Smith he failed to show any prejudice. The Seventh Circuit affirmed denial of federal habeas relief, stating that Smith’s counsel was particularly deficient, but Smith failed to show how his lawyer’s substandard effort prejudiced his case in light of the overwhelming evidence against him. View "Roy Smith v. Richard Brown" on Justia Law