U.S. v. Douglas

• Citation: 996 F.Supp. 969
• Decision Date: 20 February 1998
• Docket Number: No. CR 96-0348 THE.,CR 96-0348 THE.
• Parties: UNITED STATES of America, Plaintiff, v. Richard DOUGLAS, Defendant.
• Court: U.S. District Court — Northern District of California

996 F.Supp. 969

UNITED STATES of America, Plaintiff, v. Richard DOUGLAS, Defendant.

No. CR 96-0348 THE.

United States District Court, N.D. California.

February 20, 1998.

John W. Keker, Elliott R. Peters, Keker & Van Nest, San Francisco, CA, for Plaintiff.

Eduardo G. Roy, U.S. Attorney's Office, Criminal Div., San Francisco, CA, Theodore Greenberg, Robert E. O'Neill, Deputy Independent Counsel, Alexandria, VA, Donald C. Smaltz, San Francisco, CA, for Defendant.

ORDER DISMISSING GRATUITIES COUNTS

HENDERSON, Chief Judge.

This case arises out of an investigation by the Office of Independent Counsel ("OIC" or government) of the former Secretary of Agriculture Michael Espy. The defendant, Richard Douglas, was charged with giving, offering or promising unlawful gratuities to Espy and with making, and causing others to make, unlawful campaign contributions to the political campaign of Henry Espy, Michael Espy's brother. At the close of the government's case, the defendant moved for acquittal under Federal Rule of Criminal Procedure 29, arguing that the government failed to provide any evidence at trial that the defendant committed the charged crimes in the Northern District of California. For the reasons set forth below, the Court hereby grants defendant's motion.

OVERVIEW

The defendant Richard Douglas was Senior Vice-President for Corporate Affairs at Sun-Diamond Growers, a large agricultural collective of growers of raisins, walnuts, prunes, figs, and hazelnuts headquartered in Pleasanton, California.¹ Douglas was indicted for, among other things,² two separate counts of providing illegal gratuities to then Secretary of Agriculture Michael Espy in violation of 18 U.S.C. sections 201(c)(1)(A) and 2. Section 201(c)(1)(A) prohibits the giving, offering, or promising of things of value to public officials for or because of any official act performed or to be performed by the public official. Count One charged that between January, 1993 and May, 1994, Douglas provided Espy with meals, luggage, and entertainment in the Northern District of California. Count Two charged that Douglas reimbursed Patricia Dempsey, Espy's then girlfriend, for a plane ticket to Athens, Greece so she could accompany Espy to an international conference on tree nuts. The remaining six counts concerned a scheme to make illegal campaign contributions to the political campaign of Henry Espy, Michael Espy's brother.

At trial, the OIC provided evidence that Douglas gave numerous gifts to Espy. The evidence showed that: Douglas gave Espy a set of luggage worth $2,427.40 in Bethesda, Maryland; Douglas treated Espy to several dinners at restaurants in Washington, D.C., Bethesda, Maryland, Atlanta, Georgia, New York City, and Los Angeles, California; and, Douglas provided Espy with tickets to the U.S. Open tennis tournament and limousine rides in New York City. The evidence also showed that Douglas expensed each of these gifts to Sun-Diamond Growers and that Sun-Diamond reimbursed him for the cost of these gifts.

In regard to Count Two, the OIC adduced evidence at trial that in Washington, D.C. Douglas gave over $3,000 in cash to Patricia Dempsey to reimburse her for transportation to Greece so that she could accompany Espy, who was to address a conference sponsored by the International Nut Council. The International Nut Council reimbursed Douglas for this expense. The International Nut Council sent a copy of the invitation asking Espy to attend the nut conference to Douglas in Pleasanton, California so that he would forward the invitation to Espy. The OIC also presented evidence that Douglas faxed the invitation from Pleasanton to the Department of Agriculture in Washington, D.C., and that Espy mailed his acceptance of this invitation to Douglas in Pleasanton.

In order to prove the intent element of the gratuities counts — that Douglas provided these gifts to Espy "for or because of" any official act performed or to be performed by the Secretary of Agriculture — the OIC provided evidence that issues of importance to Douglas were pending before the Department of Agriculture at the time Douglas gave these gifts. The majority of these issues were important to Douglas because they were important to Sun-Diamond Growers. However, the OIC also provided evidence, over Douglas' repeated objections, of an additional matter pending before the Department of Agriculture that was of importance to Douglas, but not to Sun-Diamond: the Elsmere "land swap" deal. This was a deal between the Elsmere Corporation and the United States Forest Service, an agency within the United States Department of Agriculture, to trade land owned by the United States Forest Service in Elsmere canyon for land owned by the Elsmere Corporation, so that the corporation could create a landfill in Elsmere canyon. The Elsmere Corporation retained Douglas as a lobbyist to help arrange this deal.

At the close of the government's case, the defendant moved for a judgment of acquittal pursuant to Federal Rule of Criminal Procedure 29, arguing that the OIC failed to provide any evidence that the defendant committed any part of the charged crimes in the Northern District of California. The Court reserved ruling on defendant's motion and submitted the case to the jury. The jury returned a guilty verdict on Count One, hung on Count Two, and acquitted the defendant on each of the remaining counts. After the jury announced its verdict, the Court asked the defendant and the OIC to brief the issues raised in defendant's Rule 29 motion as they relate to Counts One and Two, the gratuities counts.

LEGAL STANDARD

Rule 29(a) requires a court to enter a judgment of acquittal "if the evidence is insufficient to sustain a conviction." FED. R.CIV.P. 29(a). In considering a Rule 29 motion, the Court "must determine whether, viewing the evidence in the light most favorable to the government, the jury could reasonably find the defendant guilty beyond a reasonable doubt."³ United States v. Merriweather, 777 F.2d 503, 507 (9th Cir.1985) (quoting United States v. Hazeem, 679 F.2d 770, 772 (9th Cir.1982)). The trial court may, as the Court did in this case, reserve decision on a Rule 29(a) motion made at the close of the government's case. FED.R.CRIM.P. 29(b). If it does reserve decision, it must decide the motion on the basis of the evidence presented to the jury at the time the ruling was reserved. FED.R.CRIM.P. 29(b).

ANALYSIS

Article III (Section 2, Clause 3) and the Sixth Amendment of the United States Constitution, as well as Federal Rule of Criminal Procedure 18, guarantee that a criminal defendant be tried in the district where the crimes were committed. United States v. Evans, 62 F.3d 1233, 1236 (9th Cir.1995);United States v. Corona, 34 F.3d 876, 878-79 (9th Cir.1994). The requirement of venue in a criminal trial cannot be taken lightly as it raises "deep issues of public policy." United States v. Johnson, 323 U.S. 273, 276, 65 S.Ct. 249, 89 L.Ed. 236 (1944). The government bears the burden of proving venue, United States v. Beech-Nut Nutrition Corp., 871 F.2d 1181, 1188 (2d Cir.1989), and proof may be direct or circumstantial. Childs, 5 F.3d at 1332. Because venue is not an essential element of the crime,⁴ the government need only prove venue by a preponderance of the evidence, not beyond a reasonable doubt. United States v. Powell, 498 F.2d 890, 891 (9th Cir.1974). When more than one crime is charged, venue must lie for each crime. Beech-Nut, 871 F.2d at 1188.

Where, as here, "the federal statute defining an offense does not indicate explicitly where Congress believes the criminal act is committed, `the locus delicti must be determined from the nature of the crime alleged and the location of the act or acts constituting it.'" Id. (quoting United States v. Anderson, 328 U.S. 699, 66 S.Ct. 1213, 90 L.Ed. 1529 (1946)); see also United States v. Angotti, 105 F.3d 539, 542 (9th Cir.1997). "In order to determine for venue purposes where a crime occurred `we examine the key verbs in the statute defining the criminal offense to find the scope of relevant conduct.'" Corona, 34 F.3d at 879 (quoting United States v. Georgacarakos, 988 F.2d 1289, 1293 (1st Cir.1993)). The key verbs in the gratuities statute are "give," "offer," and "promise."⁵ The issue here is not one of sufficiency of evidence. The OIC provided no evidence whatsoever at trial that the defendant gave, offered, or promised a thing of value to Espy in the Northern District of California. Thus, the gratuities charges must be dismissed for lack of venue.

The OIC counters that the gratuities charges are continuing offenses, and that part of the ongoing gratuities scheme was the defendant's reimbursement by Sun-Diamond Growers. Because the corporate head-quarters of Sun-Diamond is located in Pleasanton, California, which in turn is located in the Northern District of California, the government argues that venue was proper in this district.

The government's argument is misplaced. Sun-Diamond's reimbursement of the defendant's expenses in providing gifts to the Secretary of Agriculture is circumstantial evidence that the defendant harbored the requisite intent to be found guilty on the gratuities charges, i.e. that the gifts were "for or because of official acts." However, the reimbursement was not itself an element of the crimes charged. "When a crime is an offense that is not unitary but instead spans space or time, it may be governed by 18 U.S.C. § 3237(a)." Beech-Nut, 871 F.2d at 1188. This statute provides:

[e]xcept as otherwise expressly provided by enactment of Congress, any offense against the United States begun in one district and completed in another, or committed in more than one district, may be ... prosecuted in any district in which such offense was begun, continued, or completed.

18 U.S.C. § 3237(a).

The defendant concedes that the gratuities offenses may be considered continuing offenses under section 3237(a). However,...