MARIANO H. OSPINA, PETITIONER V. UNITED STATES OF AMERICA No. 90-6719 In The Supreme Court Of The United States October Term, 1990 On Petition For A Writ Of Certiorari To The United States Court Of Appeals For The Eleventh Circuit Brief For The United States In Opposition OPINIONS BELOW The orders of the court of appeals (Pet. App. 1) and the district court (Pet. App. 2-3) denying petitioner's motion for relief under 28 U.S.C. 2255 are not reported. The opinion of the court of appeals on petitioner's direct appeal of his criminal convictions is reported at 798 F.2d 1570. JURISDICTION The judgment of the court of appeals was entered on July 25, 1990. The petition for a writ of certiorari was filed on December 20, 1990, and is therefore out of time under this Court's Rule 13.1. The jurisdiction of this Court is invoked under 28 U.S.C. 1254(1). QUESTIONS PRESENTED 1. Whether petitioner's due process rights were violated by the alleged destruction of evidence that he claims would have been exculpatory. 2. Whether the evidence was sufficient to support petitioner's convictions on charges of conspiracy and concealment of material facts from the United States relating to the existence, source, and transfer of currency in amounts exceeding $10,000. 3. Whether the government engaged in "outrageous conduct" by failing to require a bank to file currency transaction reports. 4. Whether the district court committed plain error by failing to use a special verdict form requiring the jury to identify the objectives of the conspiracy. 5. Whether the district court improperly allowed into evidence a trial witness's grand jury testimony. 6. Whether petitioner's trial and appellate counsel ineffectively argued or failed to argue the points he now raises on collateral attack. STATEMENT After a jury trial in the United States District Court for the Southern District of Florida, petitioner was convicted on one count of conspiracy (18 U.S.C. 371) and five substantive counts of concealing, by scheme and device, material facts relating to the existence, source and transfer of currency in amounts exceeding $10,000 (18 U.S.C. 1001). The district court sentenced petitioner to a total of ten years in prison, consisting of a five-year term on the conspiracy conviction to be followed by five concurrent five-year prison terms on the substantive counts. The court of appeals affirmed. 798 F.2d 1570. After his convictions were affirmed, petitioner instituted a series of motions in the district court pursuant to Fed. R. Crim. P. 35 and 28 U.S.C. 2255 challenging his sentence and convictions. Those motions were referred to a magistrate, who recommended that they be denied. The district court agreed with that recommendation and, on May 1, 1989, issued a final order denying petitioner's request for relief under 28 U.S.C. 2255. Pet. App. 2-3. The court of appeals affirmed this order without opinion. Pet. App. 1. 1. The facts underlying petitioner's convictions are set forth in the court of appeals' opinion on direct appeal. 798 F.2d 1570. Briefly, the evidence showed that petitioner and his brother Rudolfo had hired Mauricio Lehrer to launder large sums of currency. /1/ Lehrer, in turn, unwittingly hired undercover Internal Revenue Service (IRS) agents to assist him in laundering the cash. Id. at 1571-1576. In June and July 1984, Lehrer and the undercover agents engaged in five separate money laundering transactions on behalf of petitioner and his brother. Lehrer generally would hand the agents large sums of cash (sometimes in the presence of petitioner and/or his brother), which the agents would then exchange at the Flagship National Bank in Miami for cashier's checks. The agents represented to Lehrer that they had a bank contact who would assure that currency transaction reports (CTRs) would not be filed with the federal government; in actuality, the agents identified themselves to bank officials as IRS agents and the bank did not file reports. All told, petitioner and his brother paid Lehrer and the agents approximately $52,000 in commissions to launder approximately $1.3 million cash. 798 F.2d at 1571-1576. The government presented evidence at trial from which the jury could have concluded that the laundered $1.3 million were drug proceeds. For example, the agents subjected the money from two of the transactions to trained narcotics sniffing dogs who alerted to the presence of narcotics scent on the money. 798 F.2d at 1573, 1574. Moreover, the agents once complained to Lehrer that the money was always extremely dirty, had a powdery substance on it, and caused them headaches because little clouds would come up when they put it through a counting machine. Lehrer responded that he knew this but "(t)hat's the business these people are in" and Lehrer would "only handle the money * * * transactions" without "get(ting) involved in that end of it." Id. at 1574. 2. The court of appeals affirmed petitioner's convictions, as well as Lehrer's convictions, on direct appeal. 798 F.2d 1570. The court concluded, as to the substantive convictions under 18 U.S.C. 1001, that petitioner had illegally concealed material information that both Lehrer and Flagship National Bank should have provided for each transaction that they conducted in excess of $10,000. The court explained that Lehrer had a legal obligation to file CTRs under the then-governing Treasury Department regulations. See id. at 1578-1579 (citing the relevant regulation, which is currently codified in revised form at 31 C.F.R. 103.11(i)(3)). The court also explained that Flagship National Bank was required to file CTRs on the currency transactions as well. /2/ The court further held that there was sufficient evidence to show that petitioner knew of the legal requirement that CTRs must be filed for the currency transactions in question and that he took affirmative steps to obstruct the filing of those reports. 798 F.2d at 1580-1581. The court cited as "direct evidence" of petitioner's knowledge the testimony of the office manager of a commodities firm handling petitioner's accounts that he had told petitioner that banks must report the details of cash transactions over $10,000. Ibid. Moreover, the court concluded that the clandestine and secretive manner in which petitioner and Lehrer dealt with the agents, as well as the fact that petitioner was willing to pay more than $52,000 for the sole purpose of laundering $1.3 million, "refutes any claim of innocent conduct." Id. at 1581. Finally, the court held that the evidence was sufficient to support petitioner's conviction on the conspiracy charge under 18 U.S.C. 371. 798 F.2d at 1582-1583. The court noted that the three objects of the conspiracy were to defraud the IRS by obstructing its collection of information on CTRs, to violate 18 U.S.C. 1001 by concealing material facts relating to currency transactions, and to violate 18 U.S.C. 1952 by using interstate commerce to facilitate a business involving narcotics and controlled substances. 798 F.2d at 1576. The court rejected petitioner's challenge to the sufficiency of the government's proof of the third object, holding that "the evidence was fully sufficient to show that the laundered money was proceeds from drug transactions." Id. at 1582. The evidence relied on by the court included Lehrer's co-conspirator statement that the money was powdery because of petitioner's business and the fact that trained narcotics dogs alerted to the scent of cocaine when they sniffed the money. Id. at 1582-1583. In addition, the court explained that "(t)he amount of money (itself) coupled with the short period of time it was transferred in could lead to a reasonable conclusion by the jury that it was the proceeds of a narcotics business." Id. at 1583. ARGUMENT Petitioner raises issues that, for the most part, were rejected by the court of appeals on his direct appeal of his convictions. The new issues petitioner has raised on collateral attack, including the claim that his counsel ineffectively argued certain issues and failed to raise others, are without merit. Accordingly, there is no warrant for this Court's review. 1. Petitioner contends (Pet. 14-24) that the government violated his due process rights by destroying "favorable and exculpatory evidence." According to petitioner, the government improperly failed to preserve and test the residue that collected on the machine the agents used to count the currency. Petitioner hypothesizes that the agents failed to preserve and test the residue because it was actually "baby talc powder" rather than cocaine. Id. at 20. This Court has held that "unless a criminal defendant can show bad faith on the part of the police, failure to preserve potentially useful evidence does not constitute a denial of due process of law." Arizona v. Youngblood, 488 U.S. 51, 58 (1988). Petitioner has a difficult task in establishing the factual predicate for his claim. There was no showing at trial that the residue was of sufficient quantity, or that it was collected in a manner to allow, for drug testing. More importantly, petitioner provides no basis for believing that the agents acted in bad faith in failing to collect and preserve the residue. In any event, petitioner was not meaningfully prejudiced by the failure to preserve the residue. Defense counsel elicited the agent's admission that the residue was not preserved for testing (see Pet. 20-21) and offered expert testimony that virtually all currency in South Florida contains cocaine residue (see Gov't C.A. Br. 41). Moreover, as we explain further below, other circumstances of the transactions indicated that the currency was related to narcotics trafficking and the issue whether the currency was drug-related bore on only one objective of a conspiracy charge that was independently sustainable based upon the two other objectives. 2. Petitioner's challenges to the sufficiency of the evidence as to his convictions were addressed and correctly rejected by the court of appeals on petitioner's direct appeal. There is no merit to petitioner's attempt reformulation of these already rejected claims. Petitioner first contends (Pet. 25-36) that the evidence failed to show that an object of the conspiracy was to violate the Travel Act (18 U.S.C. 1952) by using interstate commerce to facilitate a narcotics business. The court of appeals correctly held (798 F.2d at 1582-1583) that there was sufficient evidence (including the facts that trained dogs alerted to the scent of cocaine and that co-conspirator Lehrer explained the money was powdery because of petitioner's business) to show that the laundered cash was drug-related. There is no merit to petitioner's claims that the proof failed to establish that interstate commerce was used and that "thereafter" an overt act was performed to further this narcotics business. As the court of appeals explained (798 F.2d at 1581), petitioner and his co-conspirators used interstate facilities by wire-transferring the laundered funds through several domestic financial institutions and they thereafter transferred the funds out of the United States to a secret account established in the Cayman Islands. Thus, even if all elements of a substantive Travel Act violation must be established where a defendant is charged only with conspiring to violate it, the evidence was sufficient. /3/ Petitioner also contends (Pet. 36-40) that the evidence was insufficient to show he affirmatively concealed material facts in a matter within the jurisdiction of the United States. See United States v. Woodward, 469 U.S. 105, 108 & n.5 (1985) (conviction under 18 U.S.C. 1001 for concealing material facts requires an affirmative act of concealment). Contrary to this claim, there was ample evidence that petitioner affirmatively schemed to conceal the fact that he was actually the source of the $1.3 million laundered through the financial institutions. Had petitioner directly deposited this money into a bank, the bank would have been required to file CTRs with the Treasury Department identifying petitioner as the person conducting the transaction. See 31 U.S.C. 5313(a); 31 C.F.R. 103.22. Petitioner paid intermediaries approximately $52,000 for the sole purpose of exchanging his cash into cashier's checks and concealing his involvement. The evidence amply showed that, far from simply passively failing to provide information, petitioner and Lehrer committed affirmative acts constituting a trick, scheme or device by which they sought to conceal material facts. See 798 F.2d at 1580-1581. 3. There is no merit to petitioner's claim (Pet. 41-44) that his convictions must be vacated because the government engaged in "outrageous misconduct" that violated his constitutional rights. The alleged misconduct is the agents' instructions to Flagship National Bank officials not to file CTRs. Even assuming the agents specifically instructed the bank not to file CTRs, rather than simply identifying themselves as federal undercover agents and leaving the decision up to the bank, that would have been a reasonable decision made to further a legitimate undercover operation. While a CTR technically was required under these circumstances (see 798 F.2d at 1579-1580), the agents' on-the-spot decision to the contrary would have caused the government no harm and certainly would not have violated petitioner's constitutional rights. Cf. Hampton v. United States, 425 U.S. 484 (1976) (rejecting attempted constitutional claim, by defendant convicted of selling heroin to undercover agent, of outrageous government misconduct). 4. Petitioner also contends (Pet. 44-47) that the court improperly failed to employ a special verdict form that would have required the jury to indicate which of the three alleged objectives petitioner had conspired to commit. Contrary to petitioner's claim, the district court was not required to employ a special verdict form requiring the jury to indicate the conspiracy objective(s) upon which it based its general guilty verdict. In this case, while counsel for petitioner's co-defendant Lehrer initially requested use of a special verdict form, Lehrer's counsel later withdrew that request and petitioner's counsel indicated that he was not requesting special verdicts. The court specifically instructed the jurors that they "all must agree unanimously as to which purpose of the conspiracy the defendants agreed to accomplish." Gov't C.A. Br. 35-36 (quoting instructions). That instruction fully protected petitioner's right to a unanimous jury verdict. Petitioner's contention that the court was required to go beyond its unanimity instruction by using special verdicts is especially unavailing in light of defense counsel's express decision not to request such verdicts. Except in forfeiture cases (Fed. R. Crim. P. 31(e)), the Federal Rules do not provide for special verdicts in criminal cases, and this Court has explained that "no general practice of these techniques (special verdicts and interrogatories) has developed in American criminal procedure." Stein v. New York, 346 U.S. 156, 178 (1953). Accordingly, the courts of appeals consistently uphold denials of special verdicts. /4/ We are aware of no case holding that a court's failure to use special verdicts is reversible error, and there is certainly no case holding that it is plain error where such verdicts were not requested. Nor is there merit to petitioner's claim that his counsel rendered ineffective assistance by not requesting special verdicts. Courts have discouraged the use of special verdict forms in multi-object conspiracy cases on the theory that they impermissibly tend to lead the jury toward a guilty verdict. /5/ As one court recently explained, the "preference for general verdicts" stems for the most part "from the unique rights of criminal defendants." United States v. Coonan, 839 F.2d 886, 891 (2d Cir. 1988). Because special verdicts are disfavored, and general verdicts generally are thought to favor the defense, petitioner's counsel did not render constitutionally ineffective assistance by deciding against seeking special verdicts on the conspiracy count. 5. Petitioner also contends (Pet. 48-51) that the district court improperly allowed into evidence the grand jury testimony of a witness who testified at trial. The testifying witness was Victor Henriquez, the office manager of a commodities firm at which petitioner had an account. After the prosecutor asked whether Henriquez had ever discussed the CTR filing requirement with petitioner, Henriquez responded, "I think I did, but I don't recall exactly." Gov't C.A. Br. 28-29 (quoting transcript). The prosecutor then was allowed, over objection, to read Henriquez's grand jury testimony that he had once told petitioner that "any cash in excess of $10,000 that would be given to me would have to be reported by the bank * * * ." Id. at 29. After his grand jury testimony was read back to him at trial, Henriquez acknowledged that he remembered it. Ibid. There is no merit to petitioner's argument that the challenged testimony was inadmissible hearsay. Henriquez testified at trial and adopted the statement after it was used to refresh his recollection. Hence, the statement was not hearsay. See Fed. R. Evid. 801(d)(1) Advisory Comm. note ("If the witness admits on the stand that he made the statement and that it was true, he adopts the statement and there is no hearsay problem."). Accord 4 J. Weinstein & M. Berger, Weinstein's Evidence Paragraph 801(d)(1)(A)(02), at 801-147 to 801-148 (1990) (citing cases). Moreover, even if Henriquez had not ultimately adopted his grand jury testimony, it could have been admitted as substantive evidence under Fed. R. Evid. 801(d)(1)(A) because it then would have been a prior inconsistent statement given under oath in a grand jury proceeding. See Weinstein's Evidence Paragraph 801(d)(1)(A)(01), at 801-142 ("a witness' lack of memory will also be grounds for substantive use" of prior sworn statement); cf. United States v. Owens, 484 U.S. 554, 563 (1988) ("It would seem strange, for example, to assert that a witness can avoid introduction of testimony from a prior proceeding that is inconsistent with his trial testimony, see Rule 801(d)(1)(A), by simply asserting lack of memory of the facts to which the prior testimony related.") (citing United States v. Murphy, 696 F.2d 282, 283-284 (4th Cir. 1982), cert. denied, 461 U.S. 945 (1983)). 6. Finally, there is no merit to petitioner's general claims that his counsel at trial and on appeal was ineffective for failing to argue the points he now raises on collateral attack. Many of the points petitioner now raises were effectively presented in somewhat different form by counsel on direct appeal, and the court of appeals correctly rejected them. The arguments that petitioner did raise for the first time on collateral attack are devoid of merit. Accordingly, it was reasonable for counsel not to advance these arguments, see Jones v. Barnes, 463 U.S. 745, 751-752 (1983) (effective advocates recognize "the importance of winnowing out weaker arguments on appeal and focusing on one central issue if possible, or at most on a few key issues"), and petitioner cannot establish he was prejudiced by counsel's failure to raise them. See Kimmelman v. Morrison, 477 U.S. 365, 384 (1986). CONCLUSION The petition for a writ of certiorari should be denied. Respectfully submitted. KENNETH W. STARR Solicitor General ROBERT S. MUELLER, III Assistant Attorney General SEAN CONNELLY Attorney FEBRUARY 1991 /1/ Lehrer was charged and convicted along with petitioner, and the court of appeals also affirmed his convictions. 798 F.2d 1570. Rudolfo Ospina was indicted together with petitioner and Lehrer, but had not been apprehended when the court of appeals affirmed the others' convictions. See id. at 1573 n.4. /2/ The court rejected the defense argument that, because the undercover agents had identified themselves as IRS agents, this removed Flagship's duty to file CTRs. Instead, the court interpreted the then-applicable exemption from the filing requirement (currently codified at 31 C.F.R. 103.22(b)(2)(iii)) as reaching only "transactions in the normal course of government business" rather than transactions conducted by undercover government agents on behalf of suspected criminals. 798 F.2d at 1579-1580. The court concluded that the "crucial" fact was that Flagship would have been obligated to file CTRs if petitioner and Lehrer had done their banking transactions directly and that their unwitting use of "an undercover agent to engage in the transactions does not change this fact." Id. at 1580. /3/ Moreover, the conspiracy conviction is independently sustainable because the evidence indisputably established the other two objectives of defrauding the IRS by obstructing collection of information on CTRs and of concealing material facts relating to currency transactions. As we explained in acquiescing to the certiorari petition in Griffin v. United States, No. 90-3562 (granted Feb. 19, 1991), most courts, but not all, hold that factual insufficiency of the evidence as to one object of a conspiracy does not affect the conviction if the proof established the other alleged object(s). The disposition of Griffin should not affect this case because, as discussed above, the court of appeals correctly held the evidence sufficient to show that the conspiracy here also encompassed using commerce to facilitate a narcotics business. /4/ See, e.g., United States v. Frezzo Brothers, Inc., 602 F.2d 1123, 1129 (3d Cir. 1979), cert. denied, 444 U.S. 1074 (1980); United States v. Shelton, 588 F.2d 1242, 1251 (9th Cir. 1978), cert. denied, 442 U.S. 909 (1979); United States v. Munz, 542 F.2d 1382, 1389 (10th Cir. 1976), cert. denied, 429 U.S. 1104 (1977); United States v. Jackson, 542 F.2d 403 (7th Cir. 1976). /5/ United States v. Spock, 416 F.2d 165, 182 (1st Cir. 1969); United States v. James, 432 F.2d 303, 307-308 (5th Cir. 1970), cert. denied, 403 U.S. 906 (1971); cf. United States v. O'Looney, 544 F.2d 385, 392 (9th Cir.) (use of special verdicts requiring jury to identify objects of conspiracy upheld where defendants consented), cert. denied, 429 U.S. 1023 (1976). See generally United States v. Ruggiero, 726 F.2d 913, 927 (2d Cir. 1984) (Newman, J., concurring in part and dissenting in part) ("There is apprehension that eliciting 'yes' or 'no' answers to questions concerning the elements of an offense may propel a jury toward a logical conclusion of guilt, whereas a more generalized assessment may have yielded an acquittal.").