U.S. v. Griffin

• Decision Date: 22 May 1996
• Docket Number: Nos. 94-3030,94-3340 and 95-1564,s. 94-3030
• Citation: 84 F.3d 912
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Steven C. GRIFFIN, Marvin M. Rux, and Andrae Scurlock, Defendants-Appellants.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 912

84 F.3d 912

UNITED STATES of America, Plaintiff-Appellee, v. Steven C. GRIFFIN, Marvin M. Rux, and Andrae Scurlock Defendants-Appellants.

Nos. 94-3030, 94-3340 and 95-1564.

United States Court of Appeals Seventh Circuit.

Argued Nov. 8, 1995.

Decided May 22, 1996. ^*

Rehearing En Banc Denied July 30, 1996.

Patrick M. Collins (argued), Office of the U.S. Atty., Crim. Div., Chicago, IL, Barry Rand Elden, Chief of Appeals, Office of the U.S. Atty., Crim. Appellate Div., Chicago, IL, for the U.S.

Joseph R. Lopez (argued), Chicago, IL, for Steven C. Griffin.

Gerardo S. Gutierrez (argued), Chicago, IL, for Marvin M. Rux.

Scott J. Frankel (argued), Frankel & Cohen, Chicago, IL, for Defendant-Appellant.

Before KANNE and DIANE P. WOOD, Circuit Judges, and SKINNER, District Judge. ^**

KANNE, Circuit Judge.

A federal jury in Chicago convicted Steven Griffin, Marvin Rux, and Andrae Scurlock of various offenses alleged in a twenty-three count indictment, including conspiracy to possess cocaine with intent to distribute, money laundering, and structuring financial transactions. Griffin and Rux appeal from their convictions alleging procedural errors and a lack of evidence sufficient to support their convictions under certain counts of the indictment. Scurlock appeals from the district court's denial of his motion for a new trial under FED.R.CRIM. P. 33. The appellants' arguments are unavailing, and we accordingly affirm the convictions.

I

A grand jury handed down a third superseding indictment on April 27, 1993, which alleged twenty-three counts of unlawful conduct and one count of criminal forfeiture. Count one charged Griffin and Scurlock with conspiracy to possess cocaine with intent to distribute in violation of 21 U.S.C. § 846 and charged Rux with aiding and abetting that conspiracy in violation of 18 U.S.C. § 2. Count two charged Griffin with possession of cocaine with intent to distribute in violation of 21 U.S.C. § 841(a)(1). Counts three and twenty-three charged Griffin with laundering the proceeds of a specified unlawful activity in violation of 18 U.S.C. § 1956(a)(1)(B)(i), and count twenty two charged Griffin with engaging in transactions using proceeds of a specified unlawful activity in violation of 18 U.S.C. §§ 1957(a), 1961(1). Counts four through twenty-one charged both Griffin and Rux with laundering the proceeds of a specified unlawful activity in violation of § 1956(a)(1)(B)(i) and (ii) and/or with structuring financial transactions so as to evade the currency transaction reporting requirements of 31 U.S.C. § 5313 in violation of 31 U.S.C. §§ 5322(a), 5324. The final, unnumbered count alleged the basis for criminal forfeiture under 21 U.S.C. § 853(a) of several parcels of real property and two automobiles, all of which were owned by Griffin.

Prior to the date of the third superseding indictment, Griffin and his then-attorney entered into plea negotiations with the government. In the course of these negotiations, Griffin signed a proffer letter on September 22, 1992, which outlined the terms and conditions of his agreement with the government, and signed an ensuing plea agreement on September 24 in which he agreed to plead guilty to count one of the second superseding indictment and admitted to the allegations contained in counts one through twenty-three. Griffin subsequently had a change of heart and a change of counsel, and the district court granted the government's motion to revoke the plea agreement. Following the revocation of the plea agreement, the grand jury issued the third superseding indictment, and the case headed to trial.

The evidence presented at trial focused upon Griffin's and Scurlock's collaborative efforts to distribute cocaine and to launder the profits of that business with the aid and assistance of Rux. The government presented testimony from, among others, several cooperating witnesses involved in the conspiracy, namely, Dwayne Hemphill, Gregory Hawkins, and Terence Ferguson; ¹ Scurlock's girlfriend, Joy Sanchez; and Rodney Rhodes, one of Scurlock's retail cocaine buyers. Their testimony, combined with the other evidence presented by the government, painted a picture of an expanding and lucrative cocaine distribution business that laundered its cash profits through various devices in an attempt to conceal the source of its income and to legitimize that income. ²

Griffin began his foray into the cocaine trade as a retail distributor supplied by Scurlock. Hemphill testified that he began working for Griffin on a part-time basis in 1985 delivering relatively small amounts of cocaine to Griffin's customers out of Griffin's hair salon at 79th Street on the south side of Chicago. The business steadily expanded from 1985 through 1988 and began to move wholesale (i.e., kilogram) quantities of cocaine. In light of this increasing traffic and the attendant profit opportunity, Hemphill became Griffin's full-time assistant in 1987, planning the movement and storage of the product and personally conducting the transactions with Scurlock.

Two government witnesses testified that Scurlock was actively involved in distributing cocaine. Joy Sanchez, Scurlock's longtime girlfriend, testified that Scurlock had been involved in cocaine distribution since the early 1980s and that he regularly weighed and packaged cocaine both at his apartment and at the coach house at 4530 South Ellis in Chicago, where he moved in 1985. Sanchez stated that she had asked Scurlock to stop selling cocaine and that he had threatened her with physical harm should she contact the law enforcement authorities. Rodney Rhodes testified that he and another person purchased one quarter kilogram of cocaine from Scurlock at a "three or four flat" apartment on Chicago's south side in March 1989.

In the spring of 1988, Griffin initiated a business relationship with Mario Lloyd, who would supply Griffin with at least thirty kilograms of cocaine in four separate transactions that year. Griffin terminated his dealings with Lloyd in late 1988 after Lloyd's assistant, Troy Shelton, was arrested in possession of twenty-four kilograms of cocaine. Following Shelton's arrest, Griffin relied on Scurlock as his primary source for a steadily increasing volume of product.

As the volume of cocaine increased, the conspiracy suffered some growing pains, including the arrests of several subordinates and the firings of others (including Hemphill). However, the evidence suggests that these events were only speed bumps for the Griffin-Scurlock partnership that continued into 1989. The two principals enjoyed the fruits of their relationship by spending large sums on automobiles, clothing, and accessories--"living the good life," as the government puts it. The business was generating large sums of cash, and Griffin and Scurlock decided to employ the services of Rux, a licensed attorney with an office at 97th and Western streets on Chicago's southwest side.

The evidence at trial shows that Rux primarily involved himself in real estate transactions and employed Terence Ferguson as an assistant. In late 1987, Rux and Ferguson formed Real Estate Investment Systems ("REIS") for the purpose of buying financially distressed properties and spinning them out of foreclosure at a profit. Rux wanted to solicit investors with large volumes of cash in need of laundering, and Ferguson testified that Rux viewed cocaine merchants as the ideal clients for his investment scheme. Rux had met Scurlock in late 1987 and Griffin some time later, and he subsequently directed Ferguson to assist Griffin as he began his business relationship with Rux and REIS.

Ferguson testified about the details of Rux's and Griffin's laundering and structuring activities, which included the Griffin-financed purchases of real property by REIS. In response to Rux's solicitation, Griffin made several investments in REIS totaling approximately $39,000 in exchange for a fixed 210% annualized interest rate over a sixty-day period. REIS used the money to purchase financially distressed real properties, and it then recruited nominal buyers to purchase the properties. These buyers would put mortgages on the properties and use the proceeds to pay off the REIS investments, which bore the usurious interest. While the return was nothing to sneeze at, Griffin had a more urgent motivation--the detergent effect REIS had upon his ill-gotten gains. REIS rinsed Griffin's principal and then paid him the principal and interest by check, which he could deposit in a bank account as purportedly legitimate income without triggering a currency transaction report under 31 U.S.C. § 5313. The evidence at trial demonstrates that Griffin did not have a legitimate source of income to account for his investment in REIS, particularly in light of his immersion in "the good life."

Ferguson also recounted the details of Griffin's purchases in late 1988 of a convenience store in Calumet Park, a house in Country Club Hills, and a six-unit apartment building in Chicago. Prior to each transaction, Rux directed Ferguson to convert Griffin's cash, which Griffin usually left in Ferguson's office, into several cashier's checks, each for less than $10,000, and to use the cashier's checks for the downpayments. The evidence showed that Ferguson converted a total of $99,810 into sixteen cashier's checks at Rux's and Griffin's behest, all in amounts under the $10,000 threshold of 31 U.S.C. § 5313.

The jury convicted Griffin, Rux, and Scurlock on all counts of the third superseding indictment on February 24, 1994. Griffin and Rux filed motions for judgments of acquittal or alternatively for new trials under FED.R.CRIM. P. 29 and 33, respectively, which the district court denied. The district court entered judgment of conviction against Griffin on August 22, 1994, ³ and against Rux on October 4, 1994. Scurlock filed a motion for new trial under FED.R.CRIM. P. 33 on August 26, 1994, based upon the allegedly false...