Monthly Archives: June 2017

When an investigation involves potential fraud, almost any document or record could be related to it. Prosecutors often need to show that transactions that appear to be legal were misleading or deceptive, which might not be apparent on the face of the documents. So the description in the warrant of what the government can seize in a white-collar case is usually quite broad, covering general categories of records and computer files created over a substantial period of time, but cannot be so vague that almost anything could be seized.

The government obtained warrants to search Mr. Weys company, New York Global Group, and his New York City apartment for evidence that he used other companies and investors as part of a plan to manipulate the shares of companies used for mergers with China-based businesses. The warrants listed 12 categories of documents that related to transactions with 220 individuals and companies, including the seizure of computers and other electronic devices that might contain records related to them.

The key to any warrant that covers so much material is to properly identify the specific crimes that were committed so that there is some limitation on what types of records can be seized. It was on this point that Judge Nathan found the warrant in Mr. Weys case had failed.

The primary flaw was that while the affidavit submitted by an F.B.I. agent to a magistrate judge gave a reasonable description of the crimes under investigation, that document was not incorporated in the warrant, or even attached to it, to establish the parameters for the search.

Because there were no apparent limits to what could be seized, the agents executing the warrants seemed to take just about everything they could get their hands on. In particular, Judge Nathan was troubled that agents took personal items with no apparent connection to the investigation, like X-rays of family members, childrens sports schedules, divorce papers, passports and family photographs.

In finding that the search violated the Fourth Amendment, the judge pointed out that failure to reference the suspected crimes would alone be enough to render the warrants insufficiently particularized.

The importance of including the crimes under investigation was highlighted in another recent case, involving the appeal of Ross W. Ulbricht, who once operated under the moniker Dread Pirate Roberts. He was sentenced to life in prison for helping set up and operate Silk Road, an anonymous online marketplace used to sell drugs and broker other illegal services. Crucial evidence came from his laptop, which was searched shortly after his arrest in a public library in San Francisco in 2013.

The warrant allowed agents to open every file to view the first few pages of a document, and search terms could be used to scan the laptops entire memory. In upholding the search, the United States Court of Appeals for the Second Circuit in Manhattan pointed out that files and documents can easily be given misleading or coded names, and words that might be expected to occur in pertinent documents can be encrypted; even very simple codes can defeat a preplanned word search.

While the description of what could be searched on Mr. Ulbrichts laptop was broad, it was permissible under the particularity requirement of the Fourth Amendment because the affidavit outlining the crimes under investigation was incorporated into the warrant, providing the necessary limitations on what could be viewed. Although that meant a very intrusive search that could include many personal documents, the appeals court found that such an invasion of a criminal defendants privacy is inevitable, however, in almost any warranted search.

Why did the government fail to meet this seemingly simple requirement of incorporating the description of the crimes under investigation in the warrant to search Mr. Weys office and apartment? There is no good explanation for that mistake, which led Judge Nathan to conclude that the warrants are in function if not in form general warrants, the death knell for any search.

One way the government could have seized virtually everything from Mr. Weys business and home would have been to offer evidence in the warrant application that his operation was completely fraudulent. Courts recognize that if a company is thoroughly permeated by fraud, such as a boiler-room operation or a bogus prescription drug dispensary, then any records connected to it would constitute evidence.

Although prosecutors made this argument to defend the seizure from Mr. Wey, they could not overcome two hurdles. First, this type of warrant is usually limited to a business rather than a home, at least unless there is substantial evidence that the home was really just an extension of the illegal operation. There was nothing in the warrant application involving Mr. Weys apartment that would indicate its primary use for that purpose, even though his wife assisted his advisory business from there.

Second, Judge Nathan found that the government did not set forth any evidence, explicit or implicit, that the scheme either constituted just the tip of iceberg with respect to fraudulent activity at Mr. Weys operation, or that the claimed fraudulent activity infused the entire business.

Perhaps the ultimate fallback in any case involving a flawed search warrant is the claim that the agents acted in good faith. The exclusionary rule is designed to deter governmental misconduct, and the Supreme Court noted in United States v. Peltier that where the official action was pursued in complete good faith, however, the deterrence rationale loses much of its force.

That exception does not apply when a warrant is so clearly flawed that no reasonable agent would rely on it. Judge Nathan found that the warrants did not have any meaningful linkage to the suspected criminal conduct and limited only, at the outer boundaries, to some relationship to the owner/occupant of the premises being searched. Therefore, a claim of good faith to salvage the fruits of an otherwise unlawful search could not be supported, so the exclusionary rule required suppression of all the evidence seized.

I expect that the Justice Department will challenge the decision because the suppressed evidence is at the heart of the case against Mr. Wey. Although a defendant cannot appeal a denial of a suppression motion until after a conviction, the Criminal Appeals Act authorizes prosecutors to seek review of a decision granting such a motion so long as the United States attorney certifies that the appeal is not for the purpose of delay and the material would be substantial proof of a fact material in the proceeding.

Judge Nathans decision sends a clear message to agents and prosecutors in white-collar-crime investigations to tread carefully when using a search warrant to gather evidence. Although a treasure trove of materials can be obtained this way, failing to pay attention to the details of properly writing and executing a warrant can have devastating consequences for a case.

Read the original here:
Mishandle a Fraud Search, and All That Fine Evidence Could Be for Nothing - New York Times

Posted Mon, June 26th, 2017 4:23 pm by Amy Howe

It has been a little over seven years since 15-year-old Sergio Hernandez was shot by Jesus Mesa, a U.S. Border Patrol agent, while Hernandez was standing on the Mexican side of the border. Hernandezs family filed a lawsuit against Mesa, arguing that (among other things) the shooting violated Hernandezs right under the Fourth Amendment to be protected against excessive deadly force. Both Mesa and the U.S. government urged the Supreme Court to uphold the lower courts rulings dismissing the familys lawsuit, but their case survived at least for now. Acknowledging that the facts outlined in the familys lawsuit depict a disturbing incident resulting in a heartbreaking loss of life, the justices sent the case back to the lower court for it to take another look.

The Hernandez family had asked the justices to weigh in on two questions: whether the Fourth Amendments bar on excessive deadly force applies outside the United States and how courts should make that determination; and whether, even if Hernandez was protected by the Fifth Amendments guarantee that his life would not be taken without proper judicial proceedings, Mesa is immune from suit. But the justices asked the two sides to brief another question: whether the Hernandez family can rely on the Supreme Courts 1971 decision in Bivens v. Six Unknown Named Agents, holding that a plaintiff can bring a private federal case for damages against federal officials who allegedly violated his constitutional rights, at all.

View of the courtroom on the last day of opinions (Art Lien)

In an unsigned opinion, the Supreme Court emphasized today that the lower court had not given any consideration to the Bivens question. The justices noted that plaintiffs cannot rely on Bivens when there are special factors counselling hesitation in the absence of affirmative action by Congress. And in another decision last week, the court continued, it indicated that the focus of that inquiry should be whether courts are well suited, absent congressional action or instruction, to consider and weigh the costs and benefits of allowing a damages action to proceed. Therefore, the court concluded, the case should go back to the lower court for it to consider what effect that ruling might have on the Bivens question in this case. Doing so, the court indicated, might eliminate any need for the court of appeals to decide whether Hernandez was protected by the Fourth Amendment which, the court seemed to suggest, could be preferable to deciding the sensitive and potentially far reaching Fourth Amendment question.

The court disagreed with the lower courts conclusion that Mesa was entitled to qualified immunity from the familys Fifth Amendment claim. That conclusion, the court explained, rested on the fact that Hernandez was not a U.S. citizen and did not have any connection to the United States. But that fact isnt relevant to whether Mesa can be immune from a lawsuit, the court countered, because Mesa only learned after the shooting that Hernandez was not a U.S. citizen. Here too, the court stressed, the lower court had not addressed whether the familys claim could even proceed under Bivens; it will now consider that question, as well as a series of other arguments about qualified immunity, on remand.

Justice Clarence Thomas wrote separately to indicate that, in his view, the Hernandez family could not rely on Bivens at all. This case, he contended, arises in circumstances that are meaningfully different from those at issue in Bivens and its progeny in particular, conduct that occurs across an international border. He would not have sent the case back to the lower court; instead, he would have put a halt to it altogether.

Justice Stephen Breyer dissented, joined by Justice Ruth Bader Ginsburg. In his view, Hernandez was protected by the Fourth Amendment when he was shot. Even if he was on the Mexican side of the border, Breyer reasoned, his location should not, standing alone, be dispositive. This is particularly true, Breyer continued, when you consider several factors. For example, Mesa who shot Hernandez is a federal law-enforcement officer, and the culvert where Hernandez was shot is in fact a special border-related area run by an international commission to which the United States contributes tens of millions of dollars each year. Moreover, a finding that Hernandez was not protected by the Fourth Amendment would create an anomalous result: Mesa could be held liable for shooting Hernandez if Hernandez was on the U.S. side of the imaginary mathematical borderline running through the culverts middle, but not if Hernandez was just a few feet on the other side of that line, even if everything else about the case, including Mesas behavior, remained the same. When all of these things are considered together, Breyer concluded, there is more than enough reason for treating the entire culvert as having sufficient involvement with, and connection to, the United States to subject the culvert to Fourth Amendment protections. He would therefore decide the Fourth Amendment question in favor of Hernandez and send the case back to the lower court for it to decide the Bivens and qualified immunity questions.

Posted in Hernndez v. Mesa, Analysis, Featured, Merits Cases

Recommended Citation: Amy Howe, Opinion analysis: Court sends cross-border shooting lawsuit back to lower court, SCOTUSblog (Jun. 26, 2017, 4:23 PM), http://www.scotusblog.com/2017/06/opinion-analysis-court-sends-cross-border-shooting-lawsuit-back-lower-court/

See original here:
Opinion analysis: Court sends cross-border shooting lawsuit back to lower court - SCOTUSblog (blog)

Last month, attorneys for former Park County prosecutor Sam Krone filed a motion to suppress bank record evidence they say was obtained on flimsy grounds, violating Krones Fourth Amendment rights.

If the suppression motion succeeds, the States most damaging evidence against Krone may never see the inside of a courtroom. Pinedale District Judge Marvin Tyler, overseeing the case due to Krones previous relationships with much of Park Countys legal community, will rule on the filing at a July 11 hearing.

Since last July, Krone has been fighting three felony and four misdemeanor counts of theft from the Park County Bar Association. The charges stem from 2010 to 2013, when Krone was treasurer of the organization and prosecutors say over $9,600 went missing from the groups bank accounts.

It was another incident in a trying period for Krone. In March 2016, he was fired from his job as Park County deputy prosecutor. In August of that same year, the incumbent lost, by a more than 2-to-1 margin, his primary bid to represent Wyoming House District 24.

In a May 18 filing on the theft case, Krones attorneys argue that Lander District Court Judge Norman Young did not have sufficient evidence to issue the search warrant that revealed many of the Bar Associations financial irregularities.

Young issued the warrant after Park County Bar Association President Andrea Earhart voiced suspicions about Krones management of Bar Association funds. She eventually got a bank ledger showing less than $100 in one of the groups accounts, and she passed that information along to Wyomings Division of Criminal Investigation.

Earhart said Krone had told her the account had $2,000 to $3,000 in it, and that Krone didnt respond to her request for a treasurers report from him.

At the end of April 2016, Judge Young used that information as the basis for a warrant allowing agents for DCI to search multiple accounts managed by the Bar Association. Those records revealed a number of questionable transactions, which Krone has described as reimbursements for Bar Association expenses.

Krones suppression filing argues that Young didnt have enough evidence to justify searching three of the Bar Associations accounts and that evidence should therefore be excluded. The filing also contends Young couldnt prove that Krone held a position of authority with those accounts, and without proving that authority existed, the rationale for searching them couldnt stand up.

The Wyoming Attorney Generals Office, prosecuting the case in place of Park County prosecutors because of Krones previous job, argue otherwise.

Phillip Donoho of the Attorney Generals office contends bank records do not enjoy Fourth Amendment protections. Furthermore, since the accounts belonged to the Bar Association instead of Krone personally, Krone lacks standing to object to their being searched.

Filings also indicate Donoho and his team are seeking to introduce evidence that Krone borrowed money from a number of friends during the period in question. And Krones campaign finance records may also be introduced.

Read more:
Motion to suppress evidence filed in Krone theft case - Cody Enterprise