United States v. Valenzuela, 022417 FED1, 16-1009

Docket Nº:16-1009
Opinion Judge:STAHL, Circuit Judge.
Attorney:Julie K. Connolly, with whom Julie Connolly Law, PLLC was on brief, for appellant. Seth R. Aframe, Assistant United States Attorney, with whom Emily Gray Rice, United States Attorney, was on brief for appellee.
Judge Panel:Before Howard, Chief Judge, Souter, Associate Justice, and Stahl, Circuit Judge.
Case Date:February 24, 2017
Court:United States Courts of Appeals, Court of Appeals for the First Circuit




No. 16-1009

United States Court of Appeals, First Circuit

February 24, 2017


Julie K. Connolly, with whom Julie Connolly Law, PLLC was on brief, for appellant.

Seth R. Aframe, Assistant United States Attorney, with whom Emily Gray Rice, United States Attorney, was on brief for appellee.

Before Howard, Chief Judge, Souter, Associate Justice, [*] and Stahl, Circuit Judge.

STAHL, Circuit Judge.

Beginning in May of 2009, the FBI launched a sting operation, codenamed Operation Dark Water, targeting the Sinaloa Drug Cartel. Undercover agents held themselves out as an organized crime operation, led by an Italian mafia boss who went by the name El Viejo ("the Old Man"), which sought to procure a long-term source of cocaine from the cartel. Among the high-level cartel members eventually ensnared by this investigative web was Rafael Humberto Celaya Valenzuela ("Celaya"), a financial planner and lawyer with close personal ties to the Cartel's then-leader, Joaquin Guzman-Loera, known more commonly as "El Chapo." Celaya was charged in the District of New Hampshire with conspiracy to distribute and possess with intent to distribute controlled substances, in violation of 21 U.S.C. § 846. He was convicted following a five-day jury trial and sentenced to 210 months imprisonment, and now appeals both his conviction and sentence. Finding no merit to his various claims, we AFFIRM.

I. Facts & Background

Celaya first came to the attention of law enforcement in August 2010, when he accompanied Jesus Manuel Gutierrez-Guzman ("Guzman"), El Chapo's cousin and close confidant, and other co-conspirators to a meeting with the undercover agents (the "FBI Organization") in Hallandale, Florida.1 At that meeting, Celaya was introduced as a lawyer and financial planner. The parties discussed how their partnership could move forward, with the FBI Organization expressing a preference for using seaports on the east coast of the United States as a transit point for shipments of cocaine from South America to Europe. The FBI represented to the Chapo Organization that because of their contacts in the longshoremens' unions at the ports, they could ensure smooth entry into and out of the ports, while avoiding detection by customs authorities. They suggested this method would be advantageous because shipments sent directly from South America to Europe would be more likely to raise suspicion. The specific ports discussed, and subsequently included on code sheets drawn up by the Chapo Organization for use in future communications, were Philadelphia, Newark, Providence, and Portsmouth, New Hampshire.

Celaya made statements at this meeting that it was his understanding that the FBI Organization had contacts in the stevedores' unions that would allow the drugs to be repackaged and sent on to Europe. He reiterated that the Chapo Organization did not have a preference for a particular port, but would simply "prefer the port that you say is the safest one for you." When Guzman expressed concerns that "the gringos are really fucking with everyone about coming into the United States, " the defendant sought to allay these fears by suggesting that "if the product is sent directly [to] Europe it will have a red flag on it already . . . Once it's brought in [to U.S. ports], relabeled and sent . . . [i]t practically goes preapproved." The defendant added that using U.S. ports, where the FBI Organization had local dockworkers in on the scheme, would be a "green light." The following day, the parties met again to discuss methods for laundering the proceeds from the drug sales. Celaya was a central player in these discussions, apparently because of his legal and financial expertise.

On April 21, 2011, Guzman met with El Viejo, the FBI agent purporting to be the head of the crime organization, at a hotel in New Hampshire near Portsmouth. The purpose of the meeting was to discuss the first shipment on which the two sides would be cooperating, which would originate in Ecuador and be shipped to Spain. While Guzman explained that it was El Chapo's preference for this first shipment to proceed directly from Ecuador to Spain without stopping in any U.S. ports, he said that the Chapo Organization was open to "modifying" the delivery method in the future.

Also in that meeting, El Viejo told Guzman that the cocaine provided by the Chapo Organization would be distributed in Europe and the United States, because he had many clients that needed the drugs, including in Florida and New Hampshire. El Viejo told Guzman that "everybody thinks I'm a legitimate businessman, " adding that "I'm like the American Donald Trump . . . except I don't have the hair" and "there is going to be an explosion of business" once El Viejo could obtain El Chapo's "high quality product." Guzman replied that he understood that distribution in the United States was one of El Viejo's objectives. Guzman also made reference to the defendant, telling El Viejo that Celaya was a trusted member of the Chapo Organization and that he had personally met with El Chapo and "explained everything to him." Other meetings followed, including one in Boston in August 2011 at which the defendant was present.

Initially, a series of delays, including the Chapo Organization's desire to run several test shipments without contraband, prevented the actual shipment of cocaine to Europe. In order to maintain the goodwill of the FBI Organization, on June 7, 2012, Guzman arranged for the delivery of heroin to the FBI Organization in Detroit, Michigan. In July 2012, the Chapo Organization finally sent 346 kilograms of cocaine from Brazil to Algeciras, Spain, bypassing U.S. ports. The following month, Guzman traveled to Spain to meet with El Viejo. At that meeting, El Viejo reiterated that the United States would be one of the destinations for the cocaine shipped by the Chapo Organization in the future, to which Guzman replied, "Yes, sir."

Shortly after this meeting, Spanish authorities placed Celaya under arrest. After Celaya waived his Miranda rights, the FBI then interviewed him. In that interview, Celaya admitted that he had conspired to distribute cocaine, and that in March 2011, after one of the initial meetings, he had travelled to Mexico to personally meet with El Chapo. At that meeting, he told El Chapo that he believed the FBI Organization was a real drug cartel and that El Chapo should proceed with the plan to supply it with cocaine.

Celaya was indicted in the District of New Hampshire and charged with conspiring, between March 2009 and September 2012, to distribute and possess with intent to distribute a quantity of heroin, methamphetamine, and 1, 000 kilograms or more of cocaine, in violation of 21 U.S.C. §§ 846 and 841(a)(1). The case proceeded to a jury trial. At the close of the government's case-in-chief, the defendant moved for a judgment of acquittal under Federal Rule of Criminal Procedure 29, claiming that there was insufficient evidence that he had participated in the conspiracy, and that there was insufficient evidence of venue. More specifically, he argued that at the time the actual shipments took place, he "was no longer in the picture" and was not involved in the conspiracy. On the venue point, he argued that the only overt act in furtherance of the conspiracy that occurred in New Hampshire was the Portsmouth meeting, and since it was an FBI source who drove Guzman from Boston's Logan Airport to the meeting, the government had "manufactured" venue in New Hampshire.

The district court denied this motion, and after a five-day trial, the jury returned a guilty verdict against Celaya. Six months after the verdict, Celaya filed a motion to reconsider the denial of his earlier Rule 29 motion, raising for the first time the argument that the overarching conspiracy did not have a sufficient jurisdictional nexus to the United States, and that the government had failed to present any evidence that Celaya knew that an object of the conspiracy was to possess or distribute controlled substances in the United States. The district court denied this motion as untimely, but also concluded that the defendant's argument on jurisdictional nexus would have failed on the merits in any event since the evidence introduced at trial was sufficient for a jury to conclude that the conspiracy envisioned the distribution of drugs into the United States and the use of seaports on the east coast of the United States as transit points on the way to Europe, and that overt acts in furtherance of the conspiracy took place on U.S. soil.

At sentencing, the district court calculated...

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