Opinion
No. 2 CA-CR 2015-0152-PR
07-29-2015
THE STATE OF ARIZONA, Respondent, v. DIANNA LYNN DEMAREE, Petitioner.
COUNSEL Mark Brnovich, Arizona Attorney General By Renee T. Bennett, Assistant Attorney General, Tucson Counsel for Respondent Harold L. Higgins PC, Tucson By Harold L. Higgins Counsel for Petitioner
THIS DECISION DOES NOT CREATE LEGAL PRECEDENT AND MAY NOT BE CITED EXCEPT AS AUTHORIZED BY APPLICABLE RULES.
NOT FOR PUBLICATION
See Ariz. R. Sup. Ct. 111(c)(1); Ariz. R. Crim. P. 31.24.
Petition for Review from the Superior Court in Pima County
No. CR20121458001
The Honorable Christopher Browning, Judge
REVIEW GRANTED; RELIEF DENIED
COUNSEL Mark Brnovich, Arizona Attorney General
By Renee T. Bennett, Assistant Attorney General, Tucson
Counsel for Respondent
Harold L. Higgins PC, Tucson
By Harold L. Higgins
Counsel for Petitioner
MEMORANDUM DECISION
Presiding Judge Vásquez authored the decision of the Court, in which Judge Howard and Judge Brammer concurred. VÁSQUEZ, Presiding Judge:
The Hon. J. William Brammer, Jr., a retired judge of this court, is called back to active duty to serve on this case pursuant to orders of this court and the supreme court. --------
¶1 Dianna Demaree seeks review of the trial court's order denying her petition for post-conviction relief filed pursuant to Rule 32.1(b), Ariz. R. Crim. P., in which she argued the court had lacked jurisdiction to render judgment against her. We grant review but deny relief.
¶2 Demaree pled guilty to criminal impersonation, admitting she acted as an accomplice to her brother's conduct in impersonating their deceased father in order to gain access to his military retirement pay. The trial court suspended the imposition of sentence, placed Demaree on a three-year term of probation, and ordered her to serve a thirty-day jail term as a condition of probation. Demaree then sought post-conviction relief, arguing, as she had in a previous motion to dismiss, that the court had lacked subject-matter jurisdiction because federal law preempted state law regarding federal military retirement benefits, including the fraudulent receipt of such benefits. The court summarily denied relief, and this petition for review followed.
¶3 Although we review de novo issues of federal preemption of Arizona law, "'[t]he party claiming preemption bears the burden of demonstrating that federal law preempts state law.'" State v. Barragan-Sierra, 219 Ariz. 276, ¶ 29, 196 P.3d 879, 889 (App. 2008), quoting E. Vanguard Forex, Ltd. v. Ariz. Corp. Comm'n, 206 Ariz. 399, ¶ 18, 79 P.3d 86, 92 (App. 2003). Federal preemption of state law under the Supremacy Clause occurs in three instances: "(1) express preemption, when Congress explicitly defines the extent to which an enactment preempts state law; (2) field or implied preemption, when state law regulates conduct in a field Congress intended the federal government to occupy exclusively; and (3) conflict preemption, when state law actually conflicts with federal law." Hutto v. Francisco, 210 Ariz. 88, ¶ 7, 107 P.3d 934, 936 (App. 2005); see also U.S. Const. art. XI, cl. 2. If federal preemption applies, a state court lacks jurisdiction over the action. See Smith v. CIGNA HealthPlan of Ariz., 203 Ariz. 173, ¶ 11, 52 P.3d 205, 209 (App. 2002) (state "'has no power to adjudicate'" preempted action), quoting Int'l Longshoremen's Ass'n, AFL-CIO v. Davis, 476 U.S. 380, 393 (1986); State v. McMurry, 184 Ariz. 447, 449, 909 P.2d 1084, 1086 (App. 1995) (concluding state had jurisdiction over forgery charge in absence of federal preemption).
¶4 Demaree asserts that Title 38 of the United States Code governs benefits for military veterans, including retirement benefits. She notes that, pursuant to 38 U.S.C. § 6102(b), the receipt of "any money or check under any of the laws administered by the Secretary [of Veterans Affairs] without being entitled to it, and with intent to defraud the United States or any beneficiary of the United States, shall be fined . . . , or imprisoned not more than one year, or both." See 38 U.S.C. § 101(1) (defining "Secretary" as "Secretary of Veterans Affairs"). Demaree acknowledges that Title 38 has no express preemption clause but argues that, because federal military retirement pay "is exclusively a federal responsibility and function" and Title 38 includes a statute prohibiting the "theft or fraud of military pension benefits," implied and conflict preemption apply.
¶5 We first observe that it is not clear whether Demaree's conduct would be subject to prosecution under 38 U.S.C. § 6102(b). The grand jury transcript and her admission at the change-of-plea hearing both indicate that she fraudulently obtained her father's military retirement payments. Military retirement is governed by Title 10 of the United States Code and overseen by the Secretary of Defense. See generally 10 U.S.C. §§ 113, 1201-1467. Section 6102(b) of Title 38, in contrast, is concerned with payments administered by the Secretary of Veterans Affairs. We readily could conclude, on this basis alone, that Demaree has not met her burden of demonstrating federal preclusion.
¶6 Even if we assume without deciding that Demaree's conduct could be prosecuted under 38 U.S.C. § 6102(b) or pursuant to some other statute under Title 10, we nonetheless conclude federal law does not preempt her prosecution under state law. A state, pursuant to its police power, has the authority "to prosecute crimes based on acts that might also violate federal law." Barragan-Sierra, 219 Ariz. 276, ¶ 30, 196 P.3d at 899; see also Reed-Kaliher v. Hoggatt, 235 Ariz. 361, ¶ 16, 332 P.3d 587, 591 (App. 2014). "Thus, we must presume that 'the historic police powers of the States [are] not to be superseded by' federal law 'unless that [is] the clear and manifest purpose of Congress.'" Reed-Kaliher, 235 Ariz. 361, ¶ 16, 332 P.3d at 591, quoting Cipollone v. Liggett Grp., Inc., 505 U.S. 504, 516 (1992) (alterations in Cipollone).
¶7 Demaree nonetheless argues her prosecution runs afoul of our federal government's "overriding interest" in "issues such as which person[s] are entitled to veterans' benefits, or the level of benefit to which each is entitled." Demaree does not explain, however, how her state prosecution for fraudulently obtaining another person's benefits results in a state determination of the proper receipt or amount of federal benefits. The mere fact that there is a parallel penalty does not result in preemption. See McMurry, 184 Ariz. at 449, 909 P.2d at 1086 (no federal preemption in prosecution for forgery based on possession of counterfeit United States currency).
¶8 Demaree further contends preemption is evident because her misrepresentations were made to the federal government. This argument ignores the obvious fact that her victim lived in Arizona and received his benefits here. Arizona's police power obviously empowers it to protect its own residents from fraud. Moreover, the authority she cites in support of this argument is readily distinguishable; both involve crimes committed solely against federal entities in judicial or quasi-judicial proceedings, not a crime also victimizing a private individual. See Thomas v. Loney, 134 U.S. 372, 375-76 (1890) (state lacked authority to prosecute perjury committed in federal court); People v. Hassan, 86 Cal. Rptr. 3d 314, 323-24 (Ct. App. 2008) (state could not prosecute for fraudulent conduct committed in course of federal immigration investigation).
¶9 Demaree additionally suggests Arizona law is in conflict with federal law because violation of the federal statute is only a misdemeanor. Thus, she asserts, the statute "interferes with the methods by which the federal statute was designed to reach the goal" of "ensuring that its entitled veterans receive the benefits to which they are entitled." An actual conflict exists only "when it is impossible to comply with both federal and state law" or where state law would interfere with the "'full purposes and objectives of Congress.'" Hutto, 210 Ariz. 88, ¶ 10, 107 P.3d at 936, quoting Hernandez-Gomez v. Volkswagen of America, Inc., 201 Ariz. 141, ¶ 3, 32 P.3d 424, 425-26 (App. 2001). Again, Demaree does not explain how the state's punishing her for fraud perpetrated on one of its residents interferes with the federal government's distribution of military retirement benefits. Nor has she identified any Congressional objective to prevent the punishment of fraud under state law.
¶10 Numerous decisions in other jurisdictions support our conclusion here. For example, the New Mexico Court of Appeals found no federal preemption even when the fraudulent obtaining of veteran benefits did not involve an individual victim. State v. Herrera, 315 P.3d 311, 313, 319 (N.M. Ct. App. 2013); see also People v. Lewis, 693 N.E.2d 916, 918-20 (Ill. App. Ct. 1998) (allowing prosecution for fraudulent claim of federal unemployment benefits); State v. Wallace, 828 N.E.2d 125, ¶¶ 14-20 (Ohio Ct. App. 2005) (state-law prosecution for theft of social security benefits not preempted); Commonwealth v. Morris, 575 A.2d 582, 584-86 (Pa. Super. Ct. 1990) (same); State v. Jones, 958 P.2d 938, 941-43 (Utah Ct. App. 1998) (no preemption of prosecution for fraud involving federal disability benefits).
¶11 We conclude Demaree has not sustained her burden of establishing that the trial court erred as a matter of law or otherwise abused its discretion. See State v. Swoopes, 216 Ariz. 390, ¶ 4, 166 P.3d 945, 948 (App. 2007) (appellate court will not disturb trial court's ruling on petition for post-conviction relief absent abuse of discretion); see also State v. Wall, 212 Ariz. 1, ¶ 12, 126 P.3d 148, 150 (2006) (error of law constitutes abuse of discretion). We therefore grant review but deny relief.