United States v. Lynch

• Decision Date: 13 September 2018
• Docket Number: No. 10-50219, No. 10-50264,10-50219
• Citation: 903 F.3d 1061
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Charles C. LYNCH, Defendant-Appellant. United States of America, Plaintiff-Appellant, v. Charles C. Lynch, Defendant-Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

903 F.3d 1061

UNITED STATES of America, Plaintiff-Appellee,

v.Charles C. LYNCH, Defendant-Appellant.

United States of America, Plaintiff-Appellant,

v.Charles C. Lynch, Defendant-Appellee.

No. 10-50219

No. 10-50264

United States Court of Appeals, Ninth Circuit.

Argued and Submitted April 13, 2018 Pasadena, California

Filed September 13, 2018

Alexandra Wallace Yates (argued), Deputy Federal Public Defender; Hilary Potashner, Federal Public Defender; Office of the Federal Public Defender, Los Angeles, California; for Defendant-Appellant.

David P. Kowal (argued), Assistant United States Attorney; Robert E. Dugdale, Chief, Criminal Division; André Birotte Jr., United States Attorney; United States Attorney's Office, Los Angeles, California; for Plaintiff-Appellee.

Joseph D. Elford, Americans for Safe Access, Oakland, California, for Amicus Curiae Americans for Safe Access.

Jenny E. Carroll, Professor of Law, Seton Hall University, Newark, New Jersey, for Amici Curiae Criminal Procedure Professors.

Paula M. Mitchell, Reed Smith LLP, Los Angeles, California, for Amici Curiae Members of Congress.

Michael V. Schafler, Benjamin B. Au, Arwen R. Johnson, and Isabel Bussarakum, Caldwell Leslie & Proctor PC, Los Angeles, California, for Amici Curiae Senators Mark Leno and Mike McGuire, and Former Senator Darrell Steinberg.

Before: John M. Rogers,^* Jay S. Bybee, and Paul J. Watford, Circuit Judges.

Dissent by Judge Watford

ROGERS, Circuit Judge:

I. Introduction

Charles Lynch ran a marijuana dispensary in Morro Bay, California, in violation of federal law. He was convicted of conspiracy to manufacture, possess, and distribute marijuana, as well as other charges related to his ownership of the dispensary. In this appeal, Lynch contends that the district court made various errors regarding Lynch's defense of entrapment by estoppel, improperly warned jurors against nullification, and allowed the prosecutors to introduce various evidence tying Lynch to the dispensary's activities, while excluding allegedly exculpatory evidence offered by Lynch. However, Lynch suffered no wrongful impairment of his entrapment by estoppel defense, the anti-nullification warning was not coercive, and the district court's evidentiary rulings were correct in light of the purposes for which the evidence was tendered. A remand for resentencing is required, though, on the government's cross-appeal of the district court's refusal to apply a five-year mandatory minimum sentence, which unavoidably applies to Lynch.

Following the filing of this appeal and after the submission of the government's brief, the United States Congress enacted an appropriations provision, which this court has interpreted to prohibit the federal prosecution of persons for activities compliant with state medical marijuana laws. Lynch contends that this provision therefore prohibits the United States from continuing to defend Lynch's conviction. We need not reach the question of whether the provision operates to annul a properly obtained conviction, however, because a genuine dispute exists as to whether Lynch's activities were actually legal under California state law. Remand will permit the district court to make findings regarding whether Lynch complied with state law.

II. Background

The facts of this case are largely unchallenged on appeal. In 2005 and into early 2006, Charles Lynch operated a marijuana store in Atascadero, California, before neighbor complaints caused the town to shut down Lynch's operations. In 2006 Lynch moved his activities to Morro Bay, opening what he called Central Coast Compassionate Caregivers (CCCC) in April of that year. Lynch's dispensary proved to be a popular one, employing around 10 subordinates and selling $2.1 million in marijuana and marijuana-related products during the period in which the dispensary operated.

Lynch's dispensary soon also attracted the attention of federal authorities. In March 2007, the DEA obtained a search warrant and raided Lynch's home, along with the dispensary. Lynch continued to operate CCCC, but his efforts there were short-lived. On July 13, 2007, the United States indicted Lynch on five counts: conspiracy to manufacture, possess, and distribute marijuana, in violation of 21 U.S.C. §§ 841(a)(1), 841(b)(1)(B), 846, 856, and 859 (Count 1); aiding the distribution of marijuana to persons below 21 years, in violation of 18 U.S.C. § 2 and 21 U.S.C. §§ 841(a)(1), 859(a) (Counts 2 and 3); marijuana possession with intent to distribute, in violation of 21 U.S.C. §§ 841(a)(1), 841(b)(1)(B) (Count 4); and maintenance of a drug-involved premise, in violation of 21 U.S.C. § 856(a)(1) (Count 5). Lynch went to trial, took the stand, and admitted what he now concedes were "sufficient facts to find him guilty of the five counts charged." The jury convicted Lynch on all counts.

Lynch's arguments on appeal largely depend on legal developments beginning over a decade before CCCC opened its doors. In 1996, California voters decriminalized the use of marijuana for medical purposes. See Cal. Prop. 215, codified at Cal. Health & Safety Code § 11362.5. The U.S. Supreme Court subsequently held that Congress's determination that marijuana was a Schedule I substance under the Controlled Substances Act meant that marijuana had no medical value, United States v. Oakland Cannabis Buyers' Co-op. , 532 U.S. 483, 491, 121 S.Ct. 1711, 149 L.Ed.2d 722 (2001), and that federal prohibition of and prosecution for marijuana-related activities remained permissible. Gonzales v. Raich , 545 U.S. 1, 22, 125 S.Ct. 2195, 162 L.Ed.2d 1 (2005). Lynch maintained a somewhat different view of the Controlled Substances Act from that of the Supreme Court, however. Lynch testified at trial that he had thought, based on the Tenth Amendment, that the 1996 referendum had overridden federal law, and thus made medical marijuana legal in California.

In accordance with this belief, Lynch claims that before opening CCCC, he had called the DEA, and reached a man, whose name or position Lynch did not know. Lynch stated that he had inquired of this person "what you guys are going to do about all of these medical marijuana dispensaries around the State of California." Lynch testified that the person responded that "it was up to the cities and counties to decide how they wanted to handle the matter." Lynch then allegedly also told the man that he intended to open a dispensary, to which the man is alleged to have repeated what he had told Lynch before, that it was "up to the cities and counties to decide."

This alleged advice did not turn out to be accurate, however. Lynch was indicted and scheduled for trial in the Central District of California. Several of the district court's actions before and during trial remain the subject of dispute in this appeal. At voir dire, the district court responded to a potential juror's invocation of jury nullification with a caution to the voir dire panel that "[n]ullification is by definition a violation of the juror's oath" and that, if selected as a juror, "you cannot substitute your sense of justice, whatever it may be, for your duty to follow the law, whether you agree with the law or not." Then, in its rulings in motions in limine and at trial, the district court permitted various evidence that Lynch contends should have been excluded as impermissibly inflammatory, and also excluded evidence that Lynch contends should have been allowed to support Lynch's defenses. Finally, Lynch alleges that the district court engaged in improper ex parte communications with the jury, and also did not disclose the contents of these communications to Lynch.

At trial, Lynch took the stand in his own defense, and, although forcefully defending his position that the DEA call had led him to believe that his activities were permitted, he also conceded facts sufficient to ensure his conviction if that defense failed. Lynch therefore requested that that the court give an instruction on entrapment by estoppel. The district court allowed an instruction on this defense with regard to counts 1, 4, and 5—general distribution, possession with intent to distribute, and maintaining a drug-involved premises—but refused to allow this defense as against counts 2 and 3, the distribution to minors charges, because the district court determined that Lynch's facts, even if believed, did not suffice to allow the defense as against those charges.

After a day of deliberation, the jury convicted Lynch on all counts. Lynch filed several post-conviction motions for a new trial, including, as relevant here, a fourth new-trial motion claiming a Brady violation. This motion stated that a prosecutor post-trial had said that the office focused its resources on targeting those marijuana dispensaries "that more clearly violated state law," and Lynch contended that this statement was exculpatory of him. The district court denied this and the other new-trial motions, however.

Following Lynch's conviction and after the failure of his new-trial motions, Lynch faced two possible mandatory-minimum sentences: a one-year mandatory minimum for distribution to persons under the age of 21, see 21 U.S.C. § 859(a), and a five-year mandatory minimum for the total amount of marijuana in his conspiracy, see 21 U.S.C. § 841(b)(1)(B)(vii). Following a lengthy sentencing process, the district court held that Lynch was not subject to the five-year minimum because, the court held, it had discretion under the so-called "safety valve," 18 U.S.C. § 3553(f), not to apply this sentence to Lynch. The court determined that the safety valve could not apply to Lynch's § 859(a) sentence, however, and so it sentenced Lynch to one year and one day in prison, suspended pending this appeal.

Lynch subsequently filed this timely appeal, challenging his conviction and objecting to the application of the one-year mandatory minimum. The government also cross-appeals, arguing for imposition of the five-year mandatory minimum.

Subsequent to Lynch's conviction,...