Opinion
Criminal Action No.: 10-0083 (JLL).
November 16, 2010
ORDER
Currently before this Court are Motions by the Defendant to (1) dismiss all extortion counts in the Indictment, (2) dismiss the Federal Program Bribery Charge under 18 U.S.C. § 666, (3) grant an evidentiary hearing regarding Defendant's entrapment defense or permit Defendant to assert the entrapment defense as a matter of law, (4) dismiss the indictment on Due Process grounds, (5) grant discovery and an evidentiary hearing regarding the grand jury's investigation, (6) grant a bill of particulars, (7) produce discovery materials under Rule 16, Federal Rule of Evidence 404(b), trial exhibits, Brady and Giglio evidence, and Jencks Act materials, (8) provide a list of all co-conspirator statements and conduct a James hearing, a minimization hearing, and a hearing concerning the admissibility of the recorded conversations, (9) provide discovery regarding the Government's official guidelines for using confidential informants, and (10) permit Defendant to file additional motions as necessary. The Government also made an application for reciprocal discovery. The Court held oral argument on November 1, 2010 and now rules as follows:
1. Motion to Dismiss Counts 1 through 3: Defendant argues that the Indictment alleges only that he accepted payment in exchange for "official influence" but not for "official acts," thus falling outside of the requirements of the Hobbs Act, 18 U.S.C. § 1951, and rendering the Act unconstitutionally vague as applied to Defendant. Proof of a specific official act need not be made to sustain a Hobbs Act conviction. United States v. Antico, 275 F.3d 245, 258 (3d Cir. 2001). The Indictment alleges numerous facts to support a reasonable conclusion that the cooperating witness offered corrupt payments "in exchange for defendant Smith's official assistance, action, and influence." (Cts. 1-3, ¶ 2.) The Court thus concludes that Counts 1 through 3 sufficiently allege violations of the Hobbs Act.
Due process requires that a statute provide fair warning to make it "reasonably clear at the relevant time that the defendant's conduct was criminal." United States v. Lanier, 520 U.S. 259, 266-67 (1997). The Indictment alleges facts that would show that Defendant was aware that the cooperating witness was soliciting him to engage in criminal activity. (See, e.g., Ct. 1, ¶ 4.) The Court thus concludes that the Hobbs Act is not unconstitutionally vague as applied to Defendant.
2. Motion to Dismiss Counts 4 and 5: Defendant argues that 18 U.S.C. § 666 cannot be applied to Defendant because the statute targets only non-public officials, and even if it does apply to Defendant, the Government cannot establish that the state agencies that the cooperating witness sought to influence received more than $10,000 in federal funds during one year, as required by the statute. Section 666 states, "Whoever . . . being an agent of an organization, or of a State, local, or Indian tribal government, or any agency thereof corruptly solicits or demands for the benefit of any person. . . ." 18 U.S.C. § 666(a)(1)(B). The language of the statute serves to "enlarge and clarify the class of persons subject to the federal bribery laws" beyond just federal public officials. United States v. Cicco, 938 F.2d 441, 445 (3d Cir. 1991). The Indictment alleges that Defendant was a New Jersey State Assemblyman during the relevant time period. (Ct. 1, ¶ 1(A).) The Court thus concludes that the Government has sufficiently alleged that 18 U.S.C. § 666 applies to Defendant.
The statute further requires that "the organization, government, or agency [described in § 666(a)(1)(B)] receives, in any one year period, benefits in excess of $10,000 under a Federal program involving a grant, contract, subsidy, loan, guarantee, insurance, or other form of Federal assistance." 18 U.S.C. § 666(b). The Indictment alleges that "the DEP and DOT were state agencies that received more than $10,000 in federal funds during the relevant one-year period." (Ct. 4-5, ¶ 2.) The Court thus concludes that the Government has sufficiently plead the requirements of 18 U.S.C. § 666(b).
Accordingly, it is on this 15 day of November, 2010,
ORDERED that Defendant's Motion to dismiss Counts 1 through 3 of the Indictment is DENIED for the reasons set forth above; and it is further
ORDERED that Defendant's Motion to dismiss Counts 4 and 5 of the Indictment is DENIED for the reasons set forth above; and it is further
ORDERED that Defendant's Motion to hold an evidentiary hearing regarding the entrapment defense or permit Defendant to introduce evidence at trial relevant to the entrapment defense is DENIED for the reasons set forth in the Court's corresponding Opinion; and it is further
ORDERED that Defendant's Motion to dismiss the indictment based on outrageous conduct by the Government and to grant discovery and an evidentiary hearing regarding the grand jury's investigation is DENIED for the reasons set forth by this Court in United States v. Beldini (Criminal Action No. 09-637) andUnited States v. Manzo (Criminal Action No. 09-759); and it is further
ORDERED that Defendant's Motion to grant a bill of particulars is DENIED as sufficient information is given in the Indictment; and it is further
ORDERED that Defendant's Motion to produce Brady and Giglio evidence is DENIED as moot, as the Government has represented to this Court that it already so complied; and it is further
ORDERED that the parties shall continue to comply with the Court's Standing Order as it pertains to evidence admissible under Federal Rule of Evidence 404(b); and it is further
ORDERED that the Government shall produce all Jencks material at least one day prior to the relevant witness's testimony; and it is further
ORDERED that, to the extent that the Government has not done so, the Government shall comply with all discovery requests under Rule 16; and it is further
ORDERED that Defendant's Motion to produce a list of all co-conspirator statements and to conduct a James hearing is DENIED without prejudice, to be reexamined at trial in the event that the Government fails to produce appropriate foundational evidence to establish the admissibility of any co-conspirator statements it seeks to introduce; and it is further
ORDERED that Defendant's Motion to conduct a minimization hearing and a hearing concerning the admissibility of the recorded conversations is DENIED at moot, as the parties have indicated to the Court that they have stipulated to the authenticity and admissibility of the recordings; and it is further
ORDERED that Defendant's Motion to provide discovery regarding the Government's official guidelines for using confidential informants is GRANTED; and it is further
ORDERED that Defendant's Motion seeking permission to file additional motions is DENIED. Both parties must seek leave of the Court prior to filing any further motions; and it is further
ORDERED that Government's Motion for reciprocal discovery is GRANTED.
IT IS SO ORDERED.
OPINION
Currently before this Court is a Motion filed by Defendant requesting that the Court hold an evidentiary hearing regarding the entrapment defense, or, in the alternative, permit Defendant to introduce evidence at trial relevant to this defense. In its reply brief, the Government requests that the Court rule the entrapment defense barred as a matter of law. The Court held oral argument on November 1, 2010.I. BACKGROUND
In 2008, federal law enforcement authorities began using Solomon Dwek as a cooperating witness to investigate public corruption within the state of New Jersey. The cooperating witness held himself out to be real estate developer David Essenbach and claimed to be interested in developing the greater Hudson and Bergen County, New Jersey, areas. The Government instructed the cooperating witness to express interest in such development to local public officials and offer these officials payments in exchange for expediting his projects and providing other official assistance.
On February 16, 2010, Defendant L. Harvey Smith was indicted on charges of conspiracy and attempt to commit extortion under color of official right under the Hobbs Act, 18 U.S.C. § 1951(a), accepting corrupt payments under 18 U.S.C. § 666, and money laundering under 18 U.S.C. § 1956. These charges arise from Defendant's alleged acceptance of corrupt payments from the cooperating witness. The indictment alleges that four meetings took place between the cooperating witness, Defendant, and Defendant's associates, Edward Cheatam, Jack Shaw, and Richard Greene, and that at those meetings the following events were captured on audio and video recordings:
• On April 24, 2009, the cooperating witness allegedly met with Defendant, Cheatam, and Shaw and discussed his intention to offer corrupt payments to Defendant. (Ct. 1, ¶ 4(A)-4(C).)
• On April 30, 2009, the cooperating witness allegedly met with Defendant, Cheatam, Shaw, and Greene and delivered a $5,000 corrupt payment to Greene. At a later date, Greene allegedly gave that money to Cheatam, who in turn provided it to Defendant in the form of laundered bank checks. (Ct. 1, ¶ 4(D)-4(N).)
• On July 16, 2009, the cooperating witness allegedly met with Defendant, Cheatam, and Shaw and discussed his intention to offer further corrupt payments to Defendant. (Ct. 1, ¶ 4(O)-4(Q).)
• On July 17, 2009, the cooperating witness allegedly met with Defendant, Cheatam, and Shaw and delivered a $10,000 corrupt payment to Cheatam. (Ct. 1, ¶ 4(R)-4(T).)
Defendant alleges that from as early as January 7, 2009, an agreement existed among Cheatam, Shaw, and the cooperating witness to target local officials and offer them corrupt payments. (Def.'s Br. at 10.)
II. DISCUSSION
Entrapment is a "relatively limited defense" that is applicable only "when the Government's deception actually implants the criminal design in the mind of the defendant." United States v. Russell, 411 U.S. 423, 436 (1973). To establish entrapment, the defendant first bears the burden of producing evidence of "(1) government inducement of the crime, and (2) a lack of predisposition on the part of the defendant to engage in the criminal conduct." United States v. Wright, 921 F.2d 42, 44 (3d Cir. 1990). Government inducement goes beyond merely providing the "opportunity to commit a crime," such as conducting a sting,Jacobson v. United States, 503 U.S. 540, 550 (1992), and requires improper conduct by the government, such as the use of intimidation or threats, coercive tactics, dogged insistence, or pleas based on need, sympathy, or friendship. United States v. Fedroff, 874 F.2d 178, 185 (3d Cir. 1989), United States v. Gendron, 18 F.3d 955 (1st Cir. 1994). The second element, lack of predisposition, looks for the existence of a similar course of criminal conduct in the past, an "already formed design" to commit the crime, or a willingness to commit the crime as evidenced by a "ready response" to the Government's inducement.Fedroff, 874 F.2d at 183. If the defendant carries its burden of production on both of these elements, "the government then has the burden of proving beyond a reasonable doubt that it did not entrap the defendant." Wright, 921 F.2d at 44. Defendant Smith alleges that he was entrapped both by the actions of his associates and by the actions of the cooperating witness.
A. Entrapment by the Actions of Cheatam and Shaw
Defendant argues that Cheatam and Shaw acted as the cooperating witness's "unofficial yet de facto agents," luring the Defendant into meeting with the cooperating witness by falsely representing to Defendant that the cooperating witness was a "legitimate businessman." (Def.'s Br. at 48.) Defendant points to wiretapped conversations between "Team Cheatam-Shaw" in which the two discussed their "financial stake in [the cooperating witness's] ability to pass bribes to political figures." (Id. at 50.) Defendant argues that these conversations further show that Cheatam and Shaw not only stood to profit from the cooperating witness, but that they in fact believed that the cooperating witness was working for the Government and was therefore not who he had held himself out to be. (Hr'g Tr. 24:20-25:24, Nov. 1, 2010.)
In the Third Circuit, "an entrapment defense cannot be predicated on the actions of a party who has not agreed explicitly or implicitly to help the government make its case against the person who complains of entrapment." United States v. Beverly, 723 F.2d 11, 12 (3d Cir. 1983). Thus, the defense of "vicarious entrapment" is not recognized. Id.; see United States v. Montgomery, 2007 WL 4570180, at *2 n. 1 (D.N.J. Dec. 21, 2007) (so holding); see also United States v. Twigg, 588 F.2d 373, 376 (3d Cir. 1978) (noting that the entrapment defense "would not be available to [the defendant] because he was brought into the criminal enterprise by [a person who was] not a government agent").
Here, there is no evidence that Cheatam and Shaw acted as agents of the Government. Evidence that they helped to bring Defendant into a criminal enterprise and stood to profit therefrom only tends to prove their status as co-conspirators. If Cheatam or Shaw were somehow aware that the cooperating witness was working for the Government, such awareness is belied by their alleged actions and in any case could not, under Beverly, constitute entrapment unless Cheatam and Shaw had an implicit or explicit agreement to help the Government. Defendant does not allege that Cheatam and Shaw actually agreed to cooperate, only that they were aware that they were dealing with a Government agent. Thus, any actions that Defendant's alleged co-conspirators may have taken in "luring" Defendant into criminal activity cannot, as a matter of law, constitute entrapment. Defendant may not argue at trial that the actions of Cheatam, Shaw, or Greene provide evidence that he was entrapped by the Government.
B. Entrapment by the Actions of the Cooperating Witness
Defendant argues that even if the actions of Cheatam and Shaw do not constitute evidence of entrapment, the actions of the cooperating witness do. Because the entrapment defense asks whether the Government has "implant[ed] the criminal design in the mind of the defendant," it bears on the question of whether the defendant possessed the intent necessary to commit the crime.Russell, 411 U.S. at 436. As such, the determination of whether a defendant has met his burden of production with respect to an entrapment defense is typically reserved until after a full hearing of the evidence at trial. See Mathews v. United States, 485 U.S. 58, 63 (1988) ("The question of entrapment is generally one for the jury, rather than for the court"). However, where there is no evidence to support an entrapment claim, the court may resolve the issue in a pretrial hearing. See United States v. Osborne, 935 F.2d 32, 38 (4th Cir. 1991); United States v. Yater, 756 F.2d 1058, 1062 (5th Cir. 1988); United States v. Fadel, 844 F.2d 1425, 1430-31 (10th Cir. 1988) (citing Mathews).
Defendant has indicated that he plans to produce specific evidence at trial to demonstrate based on the "totality of the circumstances" that the cooperating witness induced Defendant to commit the crimes charged. (Hr'g Tr. 39:9.) First, Defendant points to the substantial government involvement in this case, as evidenced by the Government's provision of expenses, transportation, recording devices, and general training to the cooperating witness. (Id. at 33:4-8.) Defendant further points to the cooperating witness's awareness of the relationship between Defendant and Cheatam, Shaw, and Greene and argues that the cooperating witness played upon the trust inherent in this relationship. (Id. at 33:9-16.) Defendant stresses that Greene acted as his "spiritual advisor" and that this fact was known to Cheatam, Shaw, and the cooperating witness. (Id. at 33:17-34:3) Defendant further argues that the cooperating witness consistently made fraudulent misrepresentations and "continuously played upon the fact that he was a donor" because he knew that Defendant was in the midst of a campaign and therefore needed to raise money. (Id. at 36:14-37.17.) Defendant finally argues that the recordings show that whenever Defendant attempted to disassociate himself from the alleged illegal activity, the cooperating witness "bulldozed" him by "trying to put words in Mr. Smith's mouth, words that do not come from Mr. Smith." (Id. at 37:18-23.)
To the extent that the Government was "substantially" involved in the case, such involvement was typical of any law enforcement sting and cannot support a finding of inducement. Jacobson, 503 U.S. at 550. And, as the Court has already held, to the extent that Defendant's arguments rely on the actions of Cheatam, Shaw, and Greene as confidants or "spiritual advisors," such evidence cannot support a finding of inducement. Defendant's two remaining arguments, his "need" for campaign funds and the cooperating witness's "bulldozing," both rely on events captured at the recorded meetings. The Court has reviewed the recordings in camera and finds that they capture both the statements and demeanor of Defendant during the conversations in which Defendant alleges he was entrapped. The recordings also capture the statements, but not the demeanor, of the cooperating witness, as the recording device was affixed to his person. Based on this review and in light of the arguments presented by Defendant in his brief and at oral argument, the Court concludes that there is no evidence to support a conclusion that Defendant was induced by the Government to commit the crimes charged.
First, the recordings provide no evidence that Defendant was in such dire need of money to fund his campaign that he was induced by the cooperating witness's corrupt solicitations. When courts have recognized a defendant's need as a basis for a finding of inducement, those cases have involved, for example, a defendant who had lost his job and needed money for his family's food and rent, Gendron, 18 F.3d at 961 (citing United States v. Kessee, 992 F.2d 1001, 1003 (9th Cir. 1993)), or a heroin addict from whom the Government has threatened to cut off his drug supply,United States v. Brooks, 215 F.3d 842, 846 (8th Cir. 2000). At oral argument, defense counsel began to compare Defendant's need for funding to that of addict's need for drugs, but stopped short of making such strained comparison. (See Hr'g Tr 36:9-37:11.) The recordings show that if Defendant even acknowledges a need for campaign funds, he never expresses anything resembling the level of need that a person in need of food, rent, or drugs would exhibit. Defendant appears to be engaged in nothing more than a business transaction. Based on this scant evidence, no reasonable jury could conclude that the cooperating witness induced Defendant to accept corrupt payments by preying upon his "need" for campaign funds.
The recordings also provide no evidence that the cooperating witness "bulldozed" Defendant's attempts to distance himself from the alleged conspiracy. The recordings do show that Defendant makes statements to the cooperating witness that could be interpreted as exhibiting an unwillingness to accept bribes — for example, that he is a "straight guy" who does not engage in "quid pro quo." The recordings further show that the cooperating witness tends to respond to such statements by indicating that he "understands" and by making statements that could be interpreted as attempting to imply an unspoken, corrupt agreement — for example, "Call it what you want" and "I support you, you support me." In making these statements, the cooperating witness appears to be attempting to redirect the conversation and solidify the corrupt agreement he is trying to make. However, the cooperating witness in no way impedes Defendant from expressing himself, and under no reasonable interpretation could his tactics rise to the level of "dogged insistence until [Defendant] capitulated" to accepting a bribe. Gendron, 18 F.3d at 961 (quoting United States v. Rodriguez, 858 F.2d 809, 815 (1st Cir. 1988)). The recordings thus provide no evidence that Defendant was "bulldozed" into the alleged conspiracy.
Thus, even when viewed in light of the "totality of the circumstances," none of the materials that Defendant plans to use at trial contains any evidence to support a finding that Defendant was induced by the cooperating witness to engage in the crimes charged. Absent any evidence of inducement, the Court concludes that the entrapment defense is not appropriate in this case.
III. CONCLUSION
Defendant's arguments that the actions of Defendant's co-conspirators induced him to commit the crimes charged fail as a matter of law, and the audio and video recordings provide no evidence that the Defendant was induced by the actions of the cooperating witness to commit such crimes. Defendant's request to hold an evidentiary hearing regarding the entrapment defense and Defendant's request to introduce evidence at trial relevant to this defense are therefore denied. An appropriate Order accompanies this Opinion.
DATED: November 15, 2010