United States v. Lee

• Decision Date: 08 August 2016
• Docket Number: August Term, 2015,Docket No. 15-458
• Citation: 833 F.3d 56
• Parties: United States of America, Appellee, v. Destin Lee, Defendant–Appellant.
• Court: U.S. Court of Appeals — Second Circuit

833 F.3d 56

United States of America, Appellee,

v.Destin Lee, Defendant–Appellant.

Docket No. 15-458

August Term, 2015

United States Court of Appeals, Second Circuit.

Argued: April 6, 2016

Decided: August 8, 2016

Scott Hartman, Assistant United States Attorney (Preet Bharara, United States Attorney for the Southern District of New York, Sarah Eddy McCallum, Assistant United States Attorney, New York, New York, on the brief), for Appellee .

Richard D. Willstatter, White Plains, New York (Green & Willstatter, White Plains, New York, on the brief), for Defendant-Appellant .

Before: KEARSE, CABRANES, and CHIN, Circuit Judges.

KEARSE

, Circuit Judge:

Defendant Destin Lee appeals from a judgment entered in the United States District Court for the Southern District of New York, convicting him following a jury trial before Vincent L. Briccetti, Judge, of theft of government property in violation of 18 U.S.C. § 641

, sentencing him principally to 30 months' imprisonment, and ordering him to forfeit $400,000 and to pay $400,000 in restitution. On appeal, Lee contends principally that his conviction of a § 641 felony violated the Grand Jury Clause of the Fifth Amendment to the Constitution because a violation of that section is a felony only if the value of the property stolen exceeded $1,000, and the indictment on which he was tried charged only a misdemeanor because it did not allege the value of the property stolen. He also challenges certain of the trial court's evidentiary rulings.

The government contends that Lee's conviction of a felony should stand, arguing principally that the indictment was adequate to charge a felony, and alternatively that if it was not, the error either was harmless or was cured by a mid-trial superseding indictment that alleged a value in excess of $1,000. We conclude that the value of the property stolen is an element of the § 641

felony offense and that, in order to charge Lee with the felony, the indictment on which he was tried should have alleged that the value of the property stolen exceeded $1,000. However, in the circumstances of this case, in which, inter alia, the defense was fully aware, well in advance of the trial, of the government's intent to prosecute the offense as a felony, and the evidence that hundreds of thousands of dollars' worth of government property had been stolen was overwhelming, the violation of the Grand Jury Clause was harmless. Finding no merit in Lee's other arguments, we affirm his conviction.

I. BACKGROUND

Section 641 of Title 18 of the United States Code

provides as follows:

Whoever embezzles, steals, purloins, or knowingly converts to his use or the use of another, or without authority, sells, conveys or disposes of any record, voucher, money, or thing of value of the United States or of any department or agency thereof, or any property made or being made under contract for the United States or any department or agency thereof; or

Whoever receives, conceals, or retains the same with intent to convert it to his use or gain, knowing it to have been embezzled, stolen, purloined or converted—

Shall be fined under this title or imprisoned not more than ten years, or both; but if the value of such property in the aggregate, combining amounts from all the counts for which the defendant is convicted in a single case, does not exceed the sum of $1,000, he shall be fined under this title or imprisoned not more than one year, or both.

The word “value” means face, par, or market value, or cost price, either wholesale or retail, whichever is greater.

18 U.S.C. § 641 (2012)

(emphases added). “[A]n offense for which the ‘maximum term of imprisonment authorized’ is ‘more than one year’ ” is “a ‘felony.’ ” Moncrieffe v. Holder, ––– U.S. ––––, 133 S.Ct. 1678, 1683, 185 L.Ed.2d 727 (2013) (quoting 18 U.S.C. § 3559(a) ). Thus, if the value of the government property stolen exceeds $1,000, the violation of § 641 is a felony.

A. The Present Prosecution and the Evidence at Trial as to Value

The present prosecution arose out of an investigation into thefts from a United States Postal Service (“USPS” or “Postal Service”) facility of truckloads of plastic pallets (“pallets”), flat structures owned by the Postal Service that the USPS and its customers use to move large quantities of mail by forklift or pallet jack. Lee, during the pertinent period, was the senior tractor-trailer operator at the facility. The investigation—assisted by cooperating witness (“CW”) Steven Iannoccone, a participant in the thefts of the pallets—soon focused on Lee.

In October 2013, Lee was arrested and charged in a criminal complaint with having stolen pallets from the Postal Service from late 2011 to and including October 2013. (See October 22, 2013 Complaint ¶ 1.) The complaint alleged that in 2012, “LEE supplied the CW with approximately two trailers full of pallets each week, with each trailer containing between 400 and 500 pallets,” that from January to May 2013 he supplied approximately 10 truckloads of pallets per month, and that the agreed payment to Lee was $1 per pallet. (Id. ¶ 6.) In February 2014, Lee and fellow USPS employee Wilfredo Herrera were indicted, charged with one count of stealing pallets from the Postal Service in violation of 18 U.S.C. §§ 641

and 2.

After Herrera pleaded guilty, the grand jury handed down superseding indictments against Lee alone in August 2014 (“S2”) and September 2014 (“S3”). The S3 Indictment charged a violation of § 641

as follows:

1. From in or about late 2011, up to and including in or about October 2013, in the Southern District of New York and elsewhere, DESTIN LEE, the defendant, knowingly did embezzle, steal, purloin, and convert to his own use and the use of another, money and things of value of the United States and of a department and agency thereof, and did receive, conceal, and retain the same with intent to convert it to his own use and gain, knowing it to have been embezzled, stolen, purloined, and converted, and did aid and abet the same, to wit, LEE participated in a scheme to steal and did steal pallets belonging to the United States Postal Service.

(Title 18, United States Code, Sections 641

and 2.)

(S3 Indictment at 1.) It also contained a forfeiture allegation, which read in part as follows:

2. As a result of committing the offense alleged in Count One of this Indictment, DESTIN LEE, the defendant, shall forfeit to the United States ... all property, real and personal, that constitutes or is derived from proceeds traceable to the commission of the offense.

(Id. at 1-2.)

The government's evidence at trial included testimony by Lee's co-worker Herrera and Iannoccone, an independent trucker. Iannoccone testified that Lee was his principal contact at the Postal Service for thefts of pallets. Pallets were valuable because they could be resold to recyclers. When Iannoccone had buyers for pallets he called Lee, who would arrange for a Postal Service trailer containing pallets to be in a relatively secluded area of the USPS facility so they could be loaded into Iannoccone's truck with minimal observation. If Lee was not available, Herrera would sometimes make the advance arrangements. Iannoccone, with Lee and/or Herrera, transferred the pallets from the USPS trailers to the trucks driven in by Iannoccone. Iannoccone gave Lee half of the money he received from the buyers. Herrera was paid a flat fee of $50 or $100 each time he assisted.

Iannoccone testified that the thefts began in 2009 and that the pallets were sold to a succession of three buyers. His testimony indicated that the sales to the first buyer preceded the 2011-2013 period covered by the S3 Indictment, and it was imprecise as to the timing of the sales to their second buyer. However, his testimony as a whole, taken in the light most favorable to the government, along with testimony by Herrera, made clear that the thefts for sales to the third buyer occurred within the indictment period. Iannoccone testified that he sold “probably anywhere from 30 to 40 box trucks” of pallets to the third buyer (Trial Transcript (“Tr.”) at 80); Herrera testified that he first became involved in the scheme about two years before his arrest in October 2013, and that he helped Lee and Iannoccone steal pallets approximately 40 times (see id. at 345-46, 312).

Iannoccone testified that they loaded each box truck with approximately 500 pallets. Thus, if as few as 30 truckloads were delivered to the third buyer, he and Lee stole some 15,000 pallets during the period covered by the indictment.

A USPS equipment manager testified that from 2011 through 2013, the Postal Service paid an average of $15-$20 per plastic pallet. Thus, the evidence indicated that the stolen pallets had cost the government at least $225,000.

Lee testified that he was not involved in any thefts and knew nothing about them: “Lee flatly denied helping Iannoccone steal pallets. He never saw Iannoccone steal pallets but he did see him frequently with Herrera. ... He did not load any trailer with pallets to be brought to Iannoccone.” (Lee brief on appeal at 31.)

B. Submission of the Case to the Jury

The court had set a trial date of September 22, 2014, and a deadline of September 5 for the parties to submit various motions and their requests for jury instructions. On September 5, the government filed its requested instructions, which included the following:

Request No. 3: Elements of the Offense

In order for you to find the defendant guilty of the offense charged in the Indictment, the Government must prove beyond a reasonable doubt the following four elements:

....

Fourth, that the value of the property was greater than $1,000.

....

Request No. 7: Fourth Element: Value of Property

The fourth and final element the Government must prove beyond a reasonable doubt is that the value of the property stolen or knowingly converted was greater than $1,000.

(Government's Requests To Charge dated September 5, 2014, at 5, 9.)

The presentation of evidence at trial began on September 23, 2014,...