U.S. v. Phillips

• Decision Date: 20 March 1987
• Docket Number: No. 86-7272,86-7272
• Citation: 812 F.2d 1355
• Parties: UNITED STATES of America, Plaintiff-Appellant, v. George A. PHILLIPS, and Luke A. Finkelstein, Defendants-Appellees.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1355

812 F.2d 1355

UNITED STATES of America, Plaintiff-Appellant, v. George A. PHILLIPS, and Luke A. Finkelstein, Defendants-Appellees.

No. 86-7272.

United States Court of Appeals Eleventh Circuit.

March 20, 1987.

John C. Bell, U.S. Atty., Mongtogmery, Ala., Gloria Phares, U.S. Dept. of Justice, Washington, D.C., for plaintiff-appellant.

Joel H. Pearson, Whitesell, Morrow & Romine, P.C., Calvin M. Whitesell, Montgomery, Ala., David Cromwell Johnson, Johnson, Cory & McNamee, Birmingham, Ala., for defendants-appellees.

Appeal from the United States District Court for the Middle District of Alabama.

Before FAY and JOHNSON, Circuit Judges, and HENDERSON, Senior Circuit Judge.

PER CURIAM:

In this case we review the district court's order granting the suppression of statements made by appellees to police officers and to agents of the Bureau of Alcohol, Tobacco, and Firearms (hereinafter Bureau). The district court found that appellees were in custody within the meaning of Miranda v. Arizona, 384 U.S. 436, 86 S.Ct. 1602, 16 L.Ed.2d 694 (1966) at the time the statements were made and that appellees were not given their Miranda rights. The United States appeals from the district court's order. Because we find that appellees were not in custody for the purposes of Miranda at the time the statements were made, we reverse the district court's order granting the motion to suppress.

FACTUAL BACKGROUND

Appellees Luke Finkelstein and George Phillips are engaged in the business of selling firearms at the Capital Pawn Shop, Inc., (hereinafter the Shop) Montgomery, Alabama, which is licensed by the Bureau. On March 4, 1985, Terry Bracken and Billy Joe Pearson, North Carolina residents, came to the Shop to purchase a .45 caliber semi-automatic pistol. Finkelstein initially refused to sell the gun when he discovered, by examining their driver's licenses, that Bracken and Pearson were out-of-state residents. At this time, however, Phillips, who also operates a tavern next door, came into the Shop, and upon being apprised of the situation, offered to buy the gun on paper. Finkelstein then prepared a Bureau Form 4473 Firearms Transaction Record, which listed Phillips as the purchaser of the gun, and recorded the sale in the Shop's Acquisition and Disposition Record book. Phillips, in turn, gave the gun to Pearson and Bracken, who paid Finkelstein $200.00. The Bureau calls this type of transaction a "straw man" sale. Subsequently, the gun was used by Pearson in an armed robbery and murder in North Carolina on March 26, 1985. ¹

On April 23, 1985, E.T. Hill, a North Carolina detective investigating the Pearson murder, contacted Montgomery police Officer Corporal Dan Carmichael, who was assigned to all the pawn shops in the Montgomery Officer Carmichael testified that when he asked Finkelstein to come to the police station, he intended to obtain a statement from Finkelstein. It is undisputed that Finkelstein knew Officer Carmichael well and that they saw each other every day since Officer Carmichael was assigned to pawn shop detail. At the police station, Finkelstein was first taken to a large holding room and then transferred to a smaller office. Only Officer Carmichael and Detective Hill were present. Officer Carmichael testified that at this point he advised Finkelstein of his Miranda rights by way of the police department's Miranda rights form. Finkelstein testified that he was not given his Miranda rights and denied ever signing a Miranda rights form. Officer Carmichael testified that the rights form was delivered to the Bureau. The record does not contain the Miranda rights form allegedly given to Finkelstein. The district court found that, "insofar as the record shows," appellees did not receive their Miranda rights.

                area.  On April 24, 1985, Detective Hill, Officer Carmichael, and Terry Bracken, who had purchased the gun earlier with Billy Pearson, went to the Shop.  Bracken, wearing a body wire, attempted to purchase a second gun from Finkelstein.  Knowing that selling a gun to a non-resident was "wrong", Finkelstein refused to sell a second gun to Bracken.  Officer Carmichael at this time asked Finkelstein to accompany the officers to the police station.  Finkelstein agreed and the three drove to the station. 2   Officer Carmichael also took possession of Finkelstein's Firearm Transaction Record, Form 4473, which listed Phillips as the purchaser of the gun
                

It is undisputed that Finkelstein was not placed under arrest, nor was he handcuffed or locked into the small office at the police station. While neither Officer Carmichael nor Detective Hill informed Finkelstein that he was free to leave, Officer Carmichael testified that Finkelstein could have left the police station at any time.

Finkelstein became apprehensive when the officers began asking questions. At this point, Detective Hill told Finkelstein that he was not interested in Finkelstein's conduct. Detective Hill stated that he was just investigating the North Carolina murder, and that Finkelstein's cooperation would be helpful. Officer Carmichael reinforced Detective Hill's position. Finkelstein then cooperated with the officers and gave a statement in which he described the straw man transaction involving Pearson, Bracken and appellee Phillips.

Finkelstein testified at the suppression hearing that he did not feel he was free to walk away from Officers Carmichael and Hill at either the Shop or the police station. He also testified, however, that the officers did nothing to prevent him from leaving the police station. It is also clear that at all times while Finkelstein was in the presence of the officers, either at the Shop or the police station, he never requested a lawyer nor made any attempt to terminate the interview.

On April 24, 1985, Officer Carmichael left word at the Shop asking Phillips to come to City Hall. ³ Phillips agreed to the meeting and drove himself to City Hall where he spoke with Officer Carmichael regarding the straw man transaction. It is undisputed that Officer Carmichael did not arrest or restrain Phillips in any way. It is also clear that Officer Carmichael did not inform Phillips of his Miranda rights. When Officer Carmichael asked Phillips about the straw man transaction, Phillips replied, "[w]hatever Luke [Finkelstein] On April 25, 1985, the day after Officer Carmichael and Detective Hill met with appellees, Officer Carmichael called the Bureau's Compliance Operations office in Birmingham and left a message that he had spoken with appellees and that they had admitted making the straw man transaction. Roger Bowling, the head of supervision for the Bureau in Birmingham, assigned Kris Fleishman, an inspector and compliance officer, to conduct a compliance inspection of the Shop. As an inspector-compliance officer for the Bureau, Fleishman commonly conducted inspections of alcohol, tobacco, and firearms industries coming under federal regulation. Pawn shops, being licensed for firearms, are governed by federal regulations and thus come under the supervision of the Bureau. Finkelstein testified that he had previously met Fleishman prior to going into the pawn shop business when Fleishman came to Finkelstein's house to explain the administrative procedures required by the Bureau for a federal firearms license.

                says is what happened."    This brief conversation between Phillips and Officer Carmichael was not reduced to a written statement
                

On May 7, 1985, Fleishman visited the Shop and spoke with Finkelstein. Fleishman testified that during the course of his visit he explained to Finkelstein that the law enforcement division of the Bureau was aware of the straw man transaction and that the Bureau would possibly conduct an investigation of the matter. Fleishman did not arrest appellee Finkelstein nor did he restrain his movement in any way. He did not advise Finkelstein of his Miranda rights. The record is clear that Fleishman made no promises to Finkelstein with respect to any future action the Bureau's law enforcement division might take in exchange for Finkelstein's cooperation. ⁴ Fleishman checked Finkelstein's inventory and paperwork, which included the Form 4473 Firearms Transaction Record and Finkelstein's false entry in the Master Log of firearms transactions which showed Phillips as the purchaser of the gun. While at the Shop, Finkelstein gave Fleishman a statement in which Finkelstein described the straw man transaction.

A copy of the April 24, 1985, statement obtained by Officer Carmichael and the May 7, 1985, statement obtained by Fleishman were sent to Bureau criminal enforcement agents, Lester Martz and Glen Kibler, who on June 13, 1985, visited the Shop. The purpose of the visit was to obtain statements from Finkelstein and Phillips regarding the firearms transaction. Martz and Kibler, who identified themselves to appellees as Bureau criminal enforcement agents, explicitly informed appellees that they were not under arrest. The agents did not advise appellees of their Miranda rights nor did they restrain appellees in any way. Both Finkelstein and Phillips were present at the Shop when the Bureau agents arrived and voluntarily discussed the sale of the handgun. Thereafter, Agent Martz and Kibler interviewed both appellees at the Shop. Both appellees gave oral statements describing the circumstances surrounding the sale.

The agents then left Finkelstein at the Shop and returned to their office where Agent Kibler reduced the oral statements given by appellees to writing. Agent Kibler testified that Finkelstein remained at the Shop so that appellees would not be forced to close their business. The agents had requested that Phillips sign his statement at Agent Kibler's office after it was reduced to writing. Phillips had agreed and followed the agents in his own car to their office where he signed his statement. The agents then returned to the Shop where Finkelstein signed his statement.

Thereafter on ...