U.S. v. Patel
| Citation | 762 F.2d 784 |
| Decision Date | 28 June 1985 |
| Docket Number | Nos. 84-1143 and 84-1146,s. 84-1143 and 84-1146 |
| Parties | UNITED STATES of America, Plaintiff-Appellee, v. Hemant PATEL, Raoji Patel, Bridgewater Development Co., and Pacific Food Beverages, Inc., Defendants-Appellants. to 84-1148. |
| Court | United States Courts of Appeals. United States Court of Appeals (9th Circuit) |
Peter Robinson, Asst. U.S. Atty., San Francisco, Cal., for plaintiff-appellee.
Marcus S. Topel and William M. Goodman, Topel and Goodman, San Francisco, Cal., for defendants-appellants.
Appeal from the United States District Court for the Northern District of California.
Before WRIGHT, PREGERSON and POOLE, Circuit Judges.
On November 9, 1983, appellants Hemant Patel, Raoji Patel, Bridgewater Development Company, and Pacific Food and Beverages were charged in a three-count indictment by the Federal Grand Jury in San Francisco. All appellants were charged in Count One with conspiracy to defraud the United States under 18 U.S.C. Sec. 371 1 by failing to comply with the International Coffee Agreement of 1962, 14 U.S.T. 1911, T.I.A.S. No. 5505, 2 and in Count Two with importation of coffee contrary to the provisions of that agreement, hence violating 18 U.S.C. Sec. 545, the smuggling statute. 3 Appellants Raoji Patel and Bridgewater Development Company were charged in Count Three with false statements in violation of 18 U.S.C. Sec. 1001. 4 Count Three was dismissed upon motion of the government.
The appellants pleaded not guilty to all charges. Venue was ordered changed to Guam on December 19, 1983. On March 21, 1984, a jury found appellants guilty of Counts One and Two.
Motions for judgment of acquittal or for new trial were denied. On May 14, 1984, Hemant Patel was sentenced to one year in prison and a $10,000 fine on Count One, to five years probation and a consecutive $10,000 fine on Count Two, and was ordered to pay the costs of prosecution in the amount of $8,920.00. Raoji Patel was placed on five years probation and fined $20,000. The corporate defendants were each fined $20,000.
Appellants filed timely notices of appeal and we assumed jurisdiction under 28 U.S.C. Sec. 1291. The cases were consolidated on appeal. We affirm.
The importation of coffee into the United States is governed by the International Coffee Agreement (ICA), which Congress has implemented in 19 U.S.C. Sec. 1356a. 5 Administration of the ICA is the responsibility of the International Coffee Organization (ICO), headquartered in London. The agreement regulates both the import and export coffee trade of all signatories to the document. The goals of the ICA are generally the achievement of a reasonable balance between world coffee supply and demand avoidance of excessive fluxuations in the levels of world coffee supplies, stocks, and prices; development of coffee producing nations; promotion of coffee consumption; and furtherance of international cooperation in connection with world coffee problems. 6 Quotas are established to limit the amount of coffee sold for export to the United States and other member countries of the ICO. Coffee sold for export to nonmember countries is unlimited, but sells at a lower price than coffee exported to member countries. Guam is a nonmember country.
In July 1982, Hemant Patel approached Joseph McDonald, the Director of the Department of Commerce for the Territory of Guam, with a proposal to ship raw coffee beans to Guam for transshipment to the United States. Patel provided details concerning his processing plans and represented to the Guam government his intention to conduct an extensive coffee bean processing operation through February 1983.
Joseph McDonald advised the appellants that under Headnote 3(a) of 19 U.S.C. Sec. 1202 of the United States Tariff Schedules, the coffee could enter the United States as a product of Guam if the beans were processed on Guam. As a product of Guam, the coffee would then be exempted from tariffs and duties, and other United States trade restrictions, since Guam is an "insular possession" of the United States whose goods qualify for the Headnote exemption.
On or about December 23, 1982, Hemant Patel purchased approximately 3,000 metric tons of processed coffee beans from Honduras and shipped them to Guam, allegedly for processing. Patel falsely represented to the Honduran coffee seller that the coffee was destined for Hong Kong, which, like Guam, is a nonmember country of the ICO. Patel was therefore able to purchase the coffee at $54 per bag instead of $120 per bag, which would have been the price had the coffee been billed for shipment to an ICO member country. A Certificate of Origin was forwarded to the ICO indicating that the shipment was destined for Hong Kong.
When the Honduran coffee arrived in Guam, Anil Patel explained to customs officials that the discrepancy between the country of origin noted on the ship manifest (Hong Kong) and the port clearance documents (Honduras) arose because a third buyer at sea had diverted the ship to Guam. Anil Patel also told the customs officials that the beans were being graded on Guam, and that the coffee had been inspected by Malaysian surveyors in Honduras. Neither statement was true.
Once in Guam, the coffee was off-loaded, tagged with a card reading "Processed in Guam, USA" and loaded onto a ship headed for the United States. By that time, Joseph McDonald was no longer employed by the government and had been retained by appellants as a consultant. In February 1983, McDonald obtained a Certificate of Origin from the Guam Customs Department for the Honduran coffee, which already was in transit to the United States. The Certificate of Origin identified the shipment as processed agricultural beans, rather than coffee.
When the coffee reached the United States, the Food and Drug Administration insisted that the Patels identify the bean by its Latin name before the product could be released. In response, Raoji Patel informed his import broker that the Latin name was "coffea." This information was conveyed to the U.S. Customs Service, which then seized the coffee in March 1983. Proceedings were instituted to forfeit the illegally imported coffee and for civil penalities totaling $9,302,682.20.
Appellants raise three main arguments for reversal: insufficiency of the evidence to support the convictions, reversible error in jury instructions, and prosecutorial misconduct during closing argument. Additionally, appellants challenge the propriety of the trial court's assessment against Hemant Patel of the costs of transferring the case to Guam. We find no merit in any of the arguments for reversal nor any abuse of discretion in assessing costs.
Appellants claim that the government failed to prove that the quotas imposed by the International Coffee Agreement were in effect at the time the coffee was imported into the United States. Consequently, they contend that the evidence was insufficient to support their convictions because proof of the existence of quotas was required for them to be found guilty of importing coffee contrary to law under 18 U.S.C. Sec. 545, and for conspiracy to defraud the United States under section 371.
The trial court instructed the jury that, in order to find the defendants guilty under those counts, the government had to prove beyond a reasonable doubt that "... the International Coffee Agreement and its quotas at all times relevant herein were operative and in effect." We believe that the district court, by its denial of the Rule 29 motions, and the jury, by its verdicts of guilty, necessarily found that the evidence showed the existence of ICA quotas when the coffee reached the United States. Even though the government had the burden of proof on this issue, see In Re Winship, 397 U.S. 358, 364, 90 S.Ct. 1068, 1072, 25 L.Ed.2d 368 (1970), evidence was introduced at trial that would support a logical inference that quotas were operative. 7
The jury verdict stands unless, viewing the evidence in the light most favorable to the government, no rational jury could have found beyond a reasonable doubt that the ICA quotas to be in effect. See Jackson v. Virginia, 443 U.S. 307, 318-19, 99 S.Ct. 2781, 2788-89, 61 L.Ed.2d 560 (1979) (); Glasser v. United States, 315 U.S. 60, 80, 62 S.Ct. 457, 469, 86 L.Ed. 680 (1942) (same); United States v. Abushi, 682 F.2d 1289, 1293 (9th Cir.1982) (same). On this record, a rational jury could have concluded beyond a reasonable doubt that all essential elements of the crimes charged were proven.
Appellants assert five claims of error regarding the instructions given by the trial court. First, they contend that the instruction concerning the requirements of the ICA shifted to appellants the burden of proof. The challenged instruction (hereinafter referred to as the "unlawful importation instruction") states:
Accordingly, the only law which you must consider in determining whether the coffee was lawfully imported into the United States is the ICA.
* * *
* * *
The ICA allows coffee to be lawfully imported into the United States as follows:
If you find that the coffee is a product of Honduras, an exporting member of the ICA,
(1) the coffee shipment must be accompanied by an International Coffee Organization Certificate of Origin Form O and export stamps which certify that the coffee may be exported under Honduras' coffee export quota.
If you find that the coffee is a product of Guam, a non-member of the ICA,
(1) the coffee shipment must be entered into the United States under the import quota which applies to coffee imported from non-member countries.
It is well settled that jury instructions are to be viewed as a whole. United States v. Park, 421 U.S. 658, 674, 95 S.Ct....
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