U.S. v. Green

• Citation: 648 F.3d 569
• Decision Date: 09 August 2011
• Docket Number: 09–3482,09–3681.,Nos. 09–3098,s. 09–3098
• Parties: UNITED STATES of America, Plaintiff–Appellee,v.James GREEN, Joseph Miller, and Alonzo Braziel, Defendants–Appellants.
• Court: United States Courts of Appeals. United States Court of Appeals (7th Circuit)

648 F.3d 569

UNITED STATES of America, Plaintiff–Appellee,

v.James GREEN, Joseph Miller, and Alonzo Braziel, Defendants–Appellants.

Nos. 09–3098

09–3482

09–3681.

United States Court of Appeals, Seventh Circuit.

Argued March 29, 2011.Decided Aug. 9, 2011.

Christopher J. Stetler (argued), Attorney, Office of the United States Attorney, Chicago, IL, for Plaintiff–Appellee.Ralph J. Schindler, Jr. (argued), Attorney, Chicago, IL, for Defendant–Appellant in No. 09–3098.Anthony R. Burch (argued), Attorney, Burch & Associates, Chicago, IL, for Defendant–Appellant in No. 09–3482.Michael J. Petro (argued), Attorney, Chicago, IL, for Defendant–Appellant in No. 09–3681.Before ROVNER, WILLIAMS, and HAMILTON, Circuit Judges.HAMILTON, Circuit Judge.

Appellants Alonzo Braziel, Joseph Miller, and James Green were found guilty of participating in a fraudulent scheme to obtain mortgage loans by providing false information to lenders. The scheme involved a complex web of players: Recruiters enlisted buyers to buy properties with fraudulently obtained mortgage funds. Financiers provided funds to the buyers to facilitate the transactions. Administrators bought fake documents to enable the buyers to obtain mortgages. Loan officers prepared fraudulent mortgage applications and sent them to the lenders. Between 2003 and 2005, the group acquired over seventy properties in the Chicago area for which lenders provided $7.2 million in loans. Most of the properties went into foreclosure when the buyers could not make the mortgage payments, resulting in losses to the lenders of $2.2 million.

On February 5, 2008, a grand jury indicted Braziel, Miller, Green, and fifteen others for mail fraud and wire fraud in violation of 18 U.S.C. §§ 1341 and 1343. Braziel and Miller were tried with two of their co-defendants. A jury convicted Braziel of three counts of mail fraud and Miller of three counts of wire fraud and three counts of mail fraud. Defendant Green was tried separately and was found guilty of three counts of wire fraud. The defendants now challenge various aspects of their convictions and sentences in these consolidated appeals. We consider the issues for each defendant, and we affirm all of their convictions and sentences.

I. Alonzo Braziel

Alonzo Braziel first became involved in the scheme in 2004 as a buyer applying for mortgage loans at the direction of others. The indictment charged that Braziel participated in fraud surrounding the purchases of three residential properties in the Chicago area located at 1430 Portland Avenue, 14820–22 South Hoyne Street, and 7321 South Evans Avenue.

Braziel raises two issues on appeal. He argues that the district court erred by admitting a statement made by one of his co-defendants in which Braziel was implicated, in violation of Bruton v. United States, 391 U.S. 123, 88 S.Ct. 1620, 20 L.Ed.2d 476 (1968). Second, Braziel asserts that the district court should not have applied a two-level sophisticated means enhancement in calculating his guideline sentence.

A. The Bruton Issue

In Bruton v. United States, the Supreme Court held that a defendant's Sixth Amendment right to confront witnesses against him is violated when the confession of a nontestifying co-defendant implicating the defendant as a participant in the crime is admitted in a joint trial of both defendants. 391 U.S. at 137, 88 S.Ct. 1620. A Bruton violation may be avoided, however, by redacting the reference to the defendant and substituting a generic reference such as “another person” or “another member of the group.” The issue here is whether the redaction used by the government, substituting for Braziel's name the words “straw buyer,” was sufficient to solve the Confrontation Clause problem. Braziel argues that, despite the redaction, the “straw buyer” reference still pointed to him as a participant in the crime. Although this is a close case, we conclude that the use of the edited statement with the “straw buyer” reference did not violate Bruton here.

1. The Co–Defendant's Statement

The government sought a pretrial ruling on the admissibility of statements made by Braziel's co-defendants, as well as an order to limit defense counsel from eliciting portions of these statements that would give rise to a violation of Bruton. The motion stated that the government would call as a witness FBI Special Agent Donald Kaiser who would relate co-defendant Donald Thomas' confession. Thomas, also on trial with Braziel and Miller, would not testify and thus would not be subject to cross-examination on the statement. The motion summarized the statement that the government would elicit from Special Agent Kaiser. It included a description of the property transaction, but it did not mention that Braziel was incriminated in that section, nor did it provide any description of the redaction that the government intended to use.

The day before Special Agent Kaiser's testimony at trial, the government discussed with defense counsel and the court how it had redacted Thomas' statement to conceal Braziel's identity. The prosecutors noted that the original statement referred to Braziel as the purchaser of 14820–22 South Hoyne Avenue, but they had replaced his name with the term “straw buyer.” Braziel's counsel made no objection at that time. At trial the next day, Special Agent Kaiser offered his testimony:

Q: Did Donald Thomas tell you about getting money for any particular properties?

A: Yes, he told me that he received $20,000 for the sale of 14822 South Hoyne in Harvey.

Q: Did he tell you anything else about that transaction?

A: Yes. Mr. Thomas explained to me that he had found a straw buyer, his term, for that property, and he explained the arrangement he had with that straw buyer. Specifically, he stated that the agreement was the straw buyer would purchase the property and then deed the property back to Mr. Thomas. Mr. Thomas would, had agreed to then purchase the property from that straw buyer several months later, and in that time frame Mr. Thomas was supposed to make the mortgage payments until he was able to repurchase that property.

Q: Did Donald Thomas say whether he had paid the straw buyer?

A: Yes, he indicated that he had agreed to and that he actually did pay that straw buyer $5,000 for the purchase of that property.

Several minutes later, Braziel's counsel objected and requested a mistrial, claiming that the jury could identify Braziel as the straw buyer, so that admitting Thomas' incriminating statement without the opportunity to cross-examine him violated Braziel's Confrontation Clause rights under Bruton. ¹

Although the Thomas statement was redacted, the jury heard other witnesses read mortgage and bank records naming Braziel as the purchaser of 14820–22 South Hoyne Avenue. Heather McCartney, an employee of lender Fremont Investment & Loan, read the following from a real estate contract in Fremont's loan application for the South Hoyne property as part of her testimony:

Q: Who is the buyer?

A: Alonzo Braziel.

Q: What is the street address of the property at issue?

A: 14820 and 22 South Hoyne, Harvey, Illinois 60426.

A few minutes before Special Agent Kaiser read from Thomas' statement, he had testified about bank records he had reviewed as part of his investigation:

A. The first real estate transaction is 14822 Hoyne Avenue in Harvey, and that transaction closed or funded on 12/20/2004. The seller was the Marquette Bank Trust 16575, and the [buyer] was Alonzo Braziel.²

Putting these pieces together, the jury could have inferred that Braziel was the straw buyer to whom Thomas referred.

The court deferred ruling on Braziel's mistrial motion until later that day when it reviewed the transcript from the conference the day before. Acknowledging some potential confusion in their prior discussion, the court then denied the mistrial motion. Braziel renewed his motion at the close of the trial, and the court again denied the motion.

2. Analysis

On appeal, Braziel maintains that the district court erred by denying his motion for a mistrial. We review the district court's denial for an abuse of discretion, United States v. Tanner, 628 F.3d 890, 898 (7th Cir.2010), but we begin by reviewing the court's application of Bruton de novo. See United States v. McGowan, 590 F.3d 446, 453 (7th Cir.2009); United States v. Nash, 482 F.3d 1209, 1218 (10th Cir.2007).

After the Supreme Court's further refinement of Bruton in Richardson v. Marsh, 481 U.S. 200, 107 S.Ct. 1702, 95 L.Ed.2d 176 (1987), and Gray v. Maryland, 523 U.S. 185, 118 S.Ct. 1151, 140 L.Ed.2d 294 (1998), it is clear that a redacted confession of a nontestifying co-defendant may be admitted as long as the redaction does not “obviously” refer to the defendant. This determination, focusing on the minutiae of the substituted word or phrase and surrounding context, is not always easy to make. See Gray, 523 U.S. at 195–96, 118 S.Ct. 1151. A district court's evaluation becomes especially difficult when the defendant's identity can be established through other evidence offered at trial, as here. Statements that “despite redaction, obviously refer directly to someone, often obviously the defendant, and which involve inferences that a jury ordinarily could make immediately” are prohibited under Bruton. Id. at 196, 118 S.Ct. 1151; see also United States v. Brooks, 125 F.3d 484, 501 (7th Cir.1997) (describing the Richardson Court's distinction between “specific testimony” identifying the defendant and an “inferential incrimination”). This case falls close to that subtle line.

We have navigated these murky waters in several of our prior cases. In United States v. Stockheimer, 157 F.3d 1082, 1086–87 (7th Cir.1998), we found no Bruton violation where the altered statement did not incriminate the nontestifying defendants by itself. In that case, the government used an open-ended reference (“inner circle”) that avoided a one-to-one correspondence between the statement and the defendant, even if...