Federal Defense Attorney Hope Lefeber Discusses Recent Third Circuit Opinions

Third Circuit Spring Recap

U.S. v. Velazquez, 749 F.3d 161 (3d Cir. 2014)

In U.S. v. Velazquez, the Third Circuit ruled that the government’s minimal efforts to apprehend Velazquez violated his Sixth Amendment right to a speedy trial. In 2005, the Philadelphia DEA sought to arrest Velazquez for dealing up to 10kg of cocaine. Learning that he was likely a resident of California, the DEA handed the case over to the U.S. Marshalls. Despite being indicted in 2005, neither Velazquez nor his lawyer were ever told of the indictment. The the only action taken by the government in the five intervening years was running Velazquez’s name through a government database a couple of times and uploading his name to the “most wanted” section on the Philadelphia DEA website—even though all evidence pointed to him living in California.

In 2010 and 2011, the government increased its efforts to find Velazquez and in December 2011, he was arrested for an unrelated narcotics charge in California. He was extradited to the Eastern District of Pennsylvania and was charged with his initial 2005 drugs offense. Velazquez moved to dismiss the case because of the delay, but the District Court rejected the motion and Velazquez pled guilty.

The decision was overturned on appeal. The Third Circuit applied the four-factor test advanced by the Supreme Court in Barker v. Wingo, 407 U.S. 514 (1972) and ruled that: (1) since the delay was over five years, it could be grounds for a Sixth Amendment violation; (2) five years without any follow-up, surveillance, or contact with Velazquez’s lawyer or family was not “reasonably diligent” government conduct; (3) since Velazquez only learned about the indictment when he was arrested, his subsequent motion to dismiss was timely; and (4) the government failed to rebut the presumption of prejudice which automatically applies to all cases with such a delay. The Court concluded as follows:

[w]e recognize the significance of our decision. A defendant who pleaded guilty to serious drug charges will no longer have to answer those charges. But we accept such rare outcomes as the necessary cost for the protection of the speedy trial right set forth in the Constitution.

U.S. v. Smith, 751 F.3d 107 (3d Cir. 2014)

In U.S. v. Smith, the Third Circuit was faced with a number of sentencing-related issues arising from a large bank fraud case. The underlying offenses were comprised of multiple convictions of bank fraud and identity theft, affecting a total of 146 victims. In light of new developments in the substantive law, the Third Circuit affirmed each defendant’s convictions but vacated the sentences. The cases were remanded to the District Court for re-sentencing. At the re-sentencing hearing, the District Court heard evidence from two customers affected by the fraud and from one postal inspector who recounted his interviews with numerous other affected customers. This hearing led the District Court to impose a two-level sentencing enhancement and the group of defendants appealed their sentences on numerous grounds.

The first argument raised on appeal was that the District Court were incorrect to re-open the record by allowing new evidence at the sentencing hearing. The Third Circuit disagreed and ruled that reopening the record is only incorrect if it causes prejudice. Here, the defendants were given notice of the evidence that the government planned to present and they had an opportunity to challenge and examine these witnesses. Moreover, the defendants were free to call their own witnesses to counter. Because no prejudice existed, the Third Circuit affirmed the District Court’s decision to re-open the record.

The next issue raised on appeal related to the postal inspector’s introduction of interviews conducted with other affected customers. The defendants alleged that these interviews violated their rights under the Confrontation Clause and that the evidence was hearsay. Again, the Third Circuit disagreed and affirmed the District Court’s decision to accept the evidence. The Court cited the “well-settled rule” that the Confrontation Clause only applies to issues determining guilt or innocence; therefore, because the evidence was only admitted for sentencing purposes, the defendants did not have a right to confront the makers of these statements. Likewise, hearsay, that might be inadmissible at trial, can be permitted during a sentencing hearing once it bears “some minimal indicium of reliability beyond mere allegation.”

Next, the defendants argued that their Sixth Amendment rights were violated because their sentences were increased on the basis of “judge-made facts.” The Third Circuit easily disposed of this argument by reiterating that that the Sixth Amendment only applies to facts that relate to the elements of the crime—the District Court judge is free to engage in additional fact finding at sentencing the stage.

The final—and most important—issue related to the sentence enhancements which were imposed after the sentencing hearing. A two-level enhancement was imposed on each defendant because the fraud was committed on over 10 “victims.” The defendants challenged the meaning of victims, in light of the Third Circuit’s recent case of U.S. v. Kennedy, claiming that those who were reimbursed could no longer be victims. The Third Circuit took this as an opportunity to build on its Kennedy decision and ruled that “victims” needed to suffer “actual loss.” Crucially, the Court ruled that the affected customers presented at the sentencing hearing all spent money to regain control of their accounts—for example, traveling costs, phone costs, time from work, and once even employed the service of a credit service investigator. Such costs, the Court ruled, were “actual costs” and therefore the customers were “victims” within the meaning of the Sentencing Guidelines. Accordingly, the Third Circuit affirmed the sentencing enhancement.

U.S. v. Harris

In U.S. v. Harris, the Third Circuit issued a brief, but interesting, opinion rejecting all of Harris’ challenges to his sentence. After consuming a large amount of alcohol and drugs at a bar, Harris took out a handgun and waived it around the bar. He was arrested and charged with unlawful possession of ammunition and unlawful possession of a firearm by a felon. Because he was so intoxicated, Harris pled nolo contendere (no contest) to his possession offense and was sentenced to the statutory maximum sentence of 120 months’ imprisonment. Harris appealed on numerous grounds.

While most of his challenges were easily rejected by the Third Circuit, he did present one somewhat novel challenge on appeal. Harris appealed the District Court’s failure to impose the two-level sentencing reduction mandated by the Sentencing Guidelines when the defendant “accepts responsibility.” In Harris’ mind, nolo contendere was the most accurate plea because he had no memory of the events in question and could not contest the prosecution’s case. He believed that he therefore deserved the “accepting responsibility” reduction and that he shouldn’t have to perjure himself by pleading guilty to an offense which he did not remember simply to get the reduced sentence.

The Third Circuit ruled that the District Court judge is always in the best position to make sentencing determinations. The District Court judge watched Harris’ demeanor during the entire trial and concluded that, notwithstanding the nolo contendere plea, Harris didn’t demonstrate the requisite level of remorse upon learning of his actions from the security footage and 911 call. Therefore, although the District Court could have imposed the reduction, its decision not to was not a “clear error” and the Third Circuit affirmed the sentence.