U.S. v. King

• Decision Date: 01 October 1997
• Docket Number: No. 1042,D,1042
• Parties: UNITED STATES of America, Appellant, v. Don KING and Don King Productions, Inc., Defendants-Appellees. ocket 97-1495.
• Court: U.S. Court of Appeals — Second Circuit

Page 394

126 F.3d 394

UNITED STATES of America, Appellant, v. Don KING and Don King Productions, Inc., Defendants-Appellees.

No. 1042, Docket 97-1495.

United States Court of Appeals, Second Circuit.

Argued Sept. 11, 1997.

Decided Oct. 1, 1997.

Baruch Weiss, New York City, Assistant United States Attorney, Southern District of New York (Mary Jo White, United States Attorney for the Southern District of New York, Christine H. Chung, Laura Grossfield Birger, Assistant United States Attorneys, on the brief), for Appellant.

Peter E. Fleming, New York City (Curtis, Mallet-Prevost, Colt & Mosle, Benard V. Preziosi, Jr., Michael Quinn, on the brief), for Defendant-Appellee King.

William H. Murphy, Jr., New York City (William H. Murphy, Jr. & Associates, William H. Murphy, III, Anthony B. Covington, Deborah Liu, on the brief), for Defendant-Appellee Don King Productions, Inc.

Before: WINTER, Chief Judge, FEINBERG and NEWMAN, Circuit Judges.

FEINBERG, Circuit Judge:

The government appeals from an order of the United States District Court for the Southern District of New York, Lawrence M. McKenna, J., dismissing for prosecutorial vindictiveness a superseding indictment as to defendant Don King Productions, Inc. (the "Corporation") obtained after the trial on the original indictment, which charged only defendant Don King individually, ended in a mistrial. The district court found that the indictment of the Corporation constituted an enhancement of the potential penalties faced by King, the Corporation's 100% shareholder. The court ruled that because of the circumstances surrounding the mistrial this enhancement raised a presumption of vindictiveness, which the government failed to rebut. For reasons set forth below, we reverse.

I. Background

Defendant King is a well-known boxing promoter who operates his business by means of the wholly-owned Corporation, which also holds the various licenses from state athletic commissions that are needed to engage in the promotion of boxing matches. In 1991, King obtained (through the Corporation) a $750,000 insurance policy from a syndicate of Lloyd's of London underwriters, hereafter referred to as the Insurer. The policy insured the Corporation against certain losses in the event that a scheduled boxing match between Julio Cesar Chavez and Harold Brazier was cancelled due to the non-appearance of one of the boxers. Shortly before the fight Chavez was injured while sparring, and the fight was postponed. After the postponement, the Corporation filed a claim with the Insurer for over $670,000 and submitted documents to support this claim, including what purported to be the contract between Chavez and King regarding promotion of the Chavez-Brazier fight.

In July 1994, King was indicted on nine counts of violation of the wire-fraud statute, 18 U.S.C. § 1343, in connection with this insurance claim. Particularly at issue is language typed at the bottom of the first page of the contract submitted to the Insurer, which reads in relevant part "$350,000.00 for maintenance non-refundable training expenses hereby acknowledged and received by JULIO CESAR CHAVEZ" (the "Rider"). The government alleges that King added this language to the contract after the injury to Chavez in order to convince the Insurer (falsely) that King had paid Chavez $350,000 in non-refundable money, for which King was now entitled to reimbursement under the policy. The government claims that King and Chavez had not made this arrangement, and that a payment by King to Chavez, which King used to support part of the insurance claim, was considered by both King and Chavez to be a loan. It further alleges that loans, being refundable, are not covered by the policy. King disputes, among other things, the government's interpretation of both the terms of the contract between King and Chavez and the scope of coverage of the insurance policy, and asserts that no fraud took place. Significantly for our purposes, at trial King also disclaimed personal involvement in the preparation of the insurance claim. Although the same facts would have supported an indictment of the Corporation, the government decided not to indict the Corporation at the time it originally charged King.

Jury selection for the trial began on September 21, 1995 and the jury began to deliberate on November 13. On November 15, one juror (who was African-American) reminded the court that she had long-standing plans to leave the country on November 17. The juror had informed the court of these plans at the outset of jury selection and had been left on the jury in the hope that the trial would conclude by then, and with the assurance of Judge McKenna that she would be able to go on the trip. On November 16, the jury indicated that a majority of jurors felt the jury was "irretrievably deadlocked."

Citing both the deadlock and the impending loss of an African-American member of the jury, King moved for a mistrial on November 16, 1995. The prosecution objected to a mistrial and instead requested an Allen charge. Allen v. United States, 164 U.S. 492, 17 S.Ct. 154, 41 L.Ed. 528 (1896). With respect to the imminent departure of one juror, the prosecution suggested that deliberations could continue with eleven jurors, pursuant to Fed.R.Crim.P. 23(b). Judge McKenna decided not to give an Allen charge and instead to discharge the jury. At the request of the government, Judge McKenna delayed discharging the jury so that the prosecution could seek a writ of mandamus ordering him to give an Allen charge.

That afternoon the parties appeared before Judge Mahoney of this court, who set the matter for argument before the next day's regularly-scheduled panel and asked Judge McKenna to await the panel's determination. Later that evening, the prosecution withdrew its mandamus petition, explaining to Judge Mahoney that it could not meet the standard for a writ of mandamus. The next morning, November 17, Judge McKenna indicated that since the petition for a writ of mandamus had been withdrawn, he was ready to discharge the jury. The prosecution stated that, in light of a press report it had received the previous night indicating that certain jurors had discussed the case with an alternate, it now joined in the motion for a mistrial. The judge declared a mistrial and the jury was discharged.

In March 1997, after the judge had denied King's post-trial motion for a judgment of acquittal pursuant to Fed.R.Crim.P. 29(c), the government obtained a superseding indictment, which contained the same nine counts against King but added the Corporation as a defendant on seven of the counts. Thereafter, King and the Corporation moved to dismiss the indictment as to the Corporation for prosecutorial vindictiveness.

In an opinion filed in August 1997, Judge McKenna found no evidence of actual vindictiveness on the part of the prosecution. However, he held that the circumstances of the mistrial gave rise to a rebuttable presumption of vindictiveness with respect to the added charges, found that the government had failed to rebut the presumption and, accordingly, dismissed the indictment as to the Corporation. King remains a defendant.

This appeal by the government followed. We expedited the appeal because commencement of the retrial is imminent.

II. Discussion

The doctrine of prosecutorial vindictiveness has its roots in two Supreme Court decisions: North Carolina v. Pearce, 395 U.S. 711, 89 S.Ct. 2072, 23 L.Ed.2d 656 (1969), and Blackledge v. Perry, 417 U.S. 21, 94 S.Ct. 2098, 40 L.Ed.2d 628 (1974). In the former case, Pearce successfully appealed a conviction and was retried on the same charges. He was convicted again, and received a longer sentence than at his first trial. The Supreme Court held that such an increase in sentence, unless supported by independent reasons in the record, violates due process because it appears to penalize a defendant for exercising his right to appeal. In Blackledge, the defendant exercised a state-law right to retrial de novo of his misdemeanor conviction. Before retrial, the prosecution indicted the defendant on a felony charge based on the same conduct. The Supreme Court, applying the reasoning of Pearce, held that this prosecutorial conduct also violated due process. Actual vindictiveness must play no part in a prosecutorial or sentencing decision and, "since the fear of such vindictiveness may unconstitutionally deter a defendant's exercise of [his rights]," the appearance of vindictiveness must also be avoided. Pearce, 395 U.S. at 725, 89 S.Ct. at 2080; Blackledge, 417 U.S. at 28, 94 S.Ct. at 2102-03.

This need to avoid the appearance of vindictiveness has taken the form of a presumption of prosecutorial vindictiveness, United States v. Goodwin, 457 U.S. 368, 373, 102 S.Ct. 2485, 2488-89, 73 L.Ed.2d 74 (1982), applied when (but only when) the circumstances of a case pose a "realistic likelihood" of such vindictiveness, Blackledge, 417 U.S. at 27, 94 S.Ct. at 2102. When the presumption is applied, it may be rebutted "by objective evidence justifying the prosecutor's action." Goodwin, 457 U.S. at 376 n. 8, 102 S.Ct. at 2490 n. 8. Otherwise, the tainted action must be thrown out.

A vindictive motive "will be found where there is direct evidence of actual vindictiveness, or a rebuttable presumption of a vindictive motive may arise under certain circumstances." United States v. White, 972 F.2d 16, 19 (2nd Cir.1992). See also Lane v. Lord, 815 F.2d 876, 879 (2nd Cir.1987); United States v. Contreras, 108 F.3d 1255, 1262 (10th Cir.1997). Judge McKenna found no evidence here of actual vindictiveness on the part of the prosecution, a finding with which we agree. The Corporation can prevail, therefore, only if vindictiveness can be presumed from the facts of this case and the government failed to rebut this presumption.

A. Presumption of Vindictiveness

In this circuit, we have declined to apply a presumption of vindictiveness to a superseding indictment...