Plany v. United States

• Decision Date: 30 July 2020
• Docket Number: No. CR-12-01606-02-PHX-SRB,No. CV-19-00370-PHX-SRB,CV-19-00370-PHX-SRB,CR-12-01606-02-PHX-SRB
• Parties: Joseph John Plany, Petitioner, v. United States of America, Respondent.
• Court: U.S. District Court — District of Arizona

Joseph John Plany, Petitioner, v. United States of America, Respondent.

No. CV-19-00370-PHX-SRB

No. CR-12-01606-02-PHX-SRB

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA

July 30, 2020

NOT FOR PUBLICATION

ORDER

The Court now considers Petitioner Joseph John Plany ("Petitioner")'s Motion Under 28 U.S.C. § 2255 to Vacate, Set Aside, or Correct Sentence by a Person in Federal Custody ("Motion") (Doc. 1, Mot.). The matter was referred to Magistrate Judge Deborah M. Fine for a Report and Recommendation ("R&R"). (Doc. 16, R. & R.)

I. BACKGROUND

A. Factual Background

The factual background of this case was summarized in the R&R and is incorporated herein:

I. INDICTMENT

On September 11, 2012, [Petitioner] was indicted along with co-Defendant Paxton Jeffrey Anderson ("Anderson") on thirty-one counts of bank fraud pursuant to 18 U.S.C. § 1344, and one count of conspiracy under 18 U.S.C. § 1349. As asserted in the indictment, [Petitioner] was employed during the period relevant to the charges by Dynamite Custom Homes ("Dynamite") and subsequently by J.R. Custom Homes. Co-Defendant Anderson was the owner of Dynamite and worked as a home builder through Dynamite and then through J.R. Custom Homes. The charges centered on allegations of bank fraud in that Defendants "devised a scheme to purchase real properties that misrepresented both material information in a uniform residential loan application" and required supporting documentation such as the applicant's assets, income, liabilities, sources of intended down-payment, and intent to occupy the improved property as a primary residence." The indictment further described the scheme as including falsifying invoices, misrepresenting to lenders that work had been completed, and forging construction draw requests in order to obtain funds from the lenders.

The conspiracy charge asserted that [Petitioner], Anderson, and others "conspired, confederated and agreed with each other" to commit bank fraud "by engaging in an ongoing conspiracy to obtain real estate based on loan applications misrepresenting material information to the lender and misrepresenting that draw requests were used for construction expenses when in fact the draws were used for personal expenses of Anderson." The indictment alleged that the conspiracy would be accomplished by Anderson recruiting his family members, friends and others as "straw buyers" of construction loans with the purpose of obtaining draw requests from the lender. As part of the conspiracy, the indictment further alleged that Anderson and [Petitioner] "copied and pasted signatures from one document to another in order to qualify buyers for loans or directed others to do so." The indictment also alleged that Anderson deposited money into prospective borrowers' accounts to make it appear [as though] the borrowers had adequate assets to qualify for loans, and also gave the borrowers money for down payments, knowing it was being misrepresented to the lender that such payments were being made by the borrower. The indictment alleged that [Petitioner] falsified draw requests and also assisted borrowers by "falsely inflating borrower's bank accounts."

II. SUMMARY OF COURT PROCEEDINGS

On May 8, 2014, the case went to trial before a jury. At the close of the Government's case and on motion by the Government, the court dismissed with prejudice four bank fraud counts for lack of sufficient evidence. After a 13-day trial, on June 4, 2014, the jury found [Petitioner] guilty on 23 counts of bank fraud and on the conspiracy count.

On May 18, 2015, the Court sentenced [Petitioner] to 48 months of imprisonment to be followed by 5 years of supervised release. [Petitioner] and Anderson were ordered to jointly and severally pay restitution in the amount of $2,909,017.46.

Through appointed counsel, [Petitioner] filed a notice of appeal with the Ninth Circuit on August 25, 2015. [Petitioner] and Anderson appealed the Court's order denying their motion for acquittal and alternative motion for a new trial. In an unpublished memorandum opinion filed on October 10, 2017, the Ninth Circuit held there was not sufficient evidence tosupport Count 1 in the indictment for bank fraud because "the evidence was insufficient to allow any rational juror to find, beyond a reasonable doubt, that M&I Bank was the lender for Count One." [Petitioner] had been acquitted on Count 1, and the Ninth Circuit's decision reversed Anderson's conviction on Count 1. However, the Ninth Circuit held there was "sufficient evidence to allow reasonable jurors to find that M&I Bank and TierOne were FDIC-insured institutions and were the lenders on the remaining counts." Among other holdings, the Ninth Circuit held that the conspiracy count in the indictment was not duplicitous, the Court did not err by "failing to give a specific unanimity instruction sua sponte" or by failing to reduce [Petitioner]'s sentence, or in its restitution order.

At trial, [Petitioner] was represented by retained counsel Thomas Hoidal. On appeal, [Petitioner] was represented by Michael J. Bresnehan. Counsel Anders V. Rosenquist represents [Petitioner] in these habeas proceedings.

III. [PETITIONER]'S HABEAS GROUNDS

[Petitioner] asserts three grounds for relief. In Ground One, [Petitioner] claims his trial counsel's performance was deficient because counsel failed to recognize early on in the case that [Petitioner] was not a "major participant" in the crimes alleged and failed to approach the prosecutor to negotiate a cooperating witness agreement.

[In] Ground Two[,] [Petitioner] claim[s] . . . that his due process rights were violated . . . when counsel agreed to a joint defense with co-defendant Anderson under which [Petitioner] agreed not to testify.

In Ground Three, [Petitioner] complains the Court lacked jurisdiction on several counts charged in his case because FDIC insurance for M&I Bank did not extend to M&I Mortgage Company, and "[m]any of the financial transactions supporting the charges in this case were made by M&I Mortgage Company, not M&I Bank."

(R. & R. at 2-4 (record citations omitted).)

B. Procedural Background

Petitioner filed the instant Motion on January 24, 2019. (Mot.) Respondent United States of America filed its Response on May 20. (Doc. 7, Resp. to Mot.) The Magistrate Judge issued her R&R on April 17, 2020, recommending that the Court: (1) deny Petitioner's Motion without an evidentiary hearing, and (2) deny a certificate of appealability because Petitioner failed to make a substantial showing of the denial of a constitutional right. (R. & R. at 20-21.) Petitioner timely filed his Objections on May 1.(Doc. 17, Obj. to R. & R. ("Obj.").)

II. LEGAL STANDARD

A federal prisoner may seek relief under 28 U.S.C. § 2255 if his sentence was "imposed in violation of the United States Constitution or the laws of the United States, . . . was in excess of the maximum authorized by law, or is otherwise subject to collateral attack." 28 U.S.C. § 2255(a). When a prisoner moves for post-conviction relief, the court "may accept, reject, or modify, in whole or in part, the findings or recommendations made by the magistrate." 28 U.S.C. § 636(b)(1). If a petitioner files timely objections to the report and recommendation, the district court must make a de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made. Id.; see also United States v. Reyna-Tapia, 328 F.3d 1114, 1121 (9th Cir. 2003) (en banc) (stating that district court is not required "to review, de novo, findings and recommendations that the parties themselves accept as correct").

III. ANALYSIS

A. Ineffective Assistance of Counsel

To prevail on an ineffective assistance of counsel ("IAC") claim, a petitioner must show that (1) counsel's representation fell below an objective standard of reasonableness, and (2) the deficiency prejudiced the defense. Strickland v. Washington, 466 U.S. 668, 687 (1984). The "objective reasonableness standard" does not demand best adherence to best practices—or even adherence to common custom. See Harrington v. Richter, 562 U.S. 86, 105 (2011). With respect to the second prong, a petitioner must affirmatively prove prejudice by "show[ing] that there is a reasonable probability that, but for counsel's unprofessional errors, the result of the proceeding would have been different. A reasonable probability is a probability sufficient to undermine confidence in the outcome." Strickland, 466 U.S. at 694. Recognizing the temptation for defendants to second-guess the efficacy of counsel's representation following an unfavorable ruling, Strickland mandates a strong presumption of both adequate assistance and the exercise of reasonable professional judgement on the part of counsel. Id. at 690; see Cullen v. Pinholster, 563 U.S. 170, 189(2011). And although the Strickland test is dual-pronged, a court may consider either prong first. Strickland, 466 U.S. at 697; see also LaGrand v. Stewart, 133 F.3d 1253, 1270 (9th Cir. 1998) (stating that courts need not look at both deficiency and prejudice if petitioner cannot establish one or other).

1. Ground One: Witness Agreement

a. "Major Participant"

In Ground One, Petitioner claims that his trial counsel's performance was deficient because counsel failed to "make himself aware of Petitioner's role in the case." (See Mot. at 9.) Petitioner argues that because he was "not a major participant" in the conspiracy, but merely a "lower level person who could testify [as] to how the conspiracy worked," counsel's failure to approach the prosecutor to negotiate a cooperating witness agreement gives rise to an IAC claim. (Id. at 9-10.) In his Objections, Petitioner maintains that he was not a "major participant" in the conspiracy, and the R&R's conclusion otherwise is "inconsistent with the evidence presented at trial." (Obj. at 2; see R. & R. at 6.) Petitioner highlights the following statements made by the trial court during his sentencing:

'But [P

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