U.S. v. Lueth

• Decision Date: 16 December 1986
• Docket Number: Nos. 85-1981,85-1984 and 85-2037,85-1982,s. 85-1981
• Citation: 807 F.2d 719
• Parties: UNITED STATES of America, Appellee, v. Amel F. LUETH, Appellant. UNITED STATES of America, Appellee, v. Patrick J. McMAHON, Appellant. UNITED STATES of America, Appellee, v. Susan M. LUETH, Appellant. UNITED STATES of America, Appellee, v. Timothy M. McCARTHY, Appellant.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 719

807 F.2d 719

UNITED STATES of America, Appellee, v. Amel F. LUETH, Appellant.

UNITED STATES of America, Appellee, v. Patrick J. McMAHON, Appellant.

UNITED STATES of America, Appellee, v. Susan M. LUETH, Appellant.

UNITED STATES of America, Appellee, v. Timothy M. McCARTHY, Appellant.

Nos. 85-1981, 85-1982, 85-1984 and 85-2037.

United States Court of Appeals,

Eighth Circuit.

Submitted June 12, 1986.

Decided Dec. 16, 1986.

Lawrence F. Scalise, Des Moines, Iowa, for A. Lueth.

John J. Reefe, Jr., Omaha, Neb., for McMahon.

Donald W. Kleine, Omaha, Neb., for McCarthy.

Paul H. Rosenberg, Des Moines, Iowa, for S. Lueth.

John Jarvey, Washington, D.C., for U.S.

Before JOHN R. GIBSON, Circuit Judge, FAIRCHILD, ^* Senior Circuit Judge, and MAGILL, Circuit Judge.

JOHN R. GIBSON, Circuit Judge.

This group of appeals arises from the purchase, distribution, and sale of large amounts of marijuana and cocaine between 1980 and 1985. Amel Lueth was convicted in the district court ¹ of knowingly engaging in a continuing criminal enterprise in violation of 21 U.S.C. Sec. 848 (1982); several counts of conspiracy to distribute, possession with intent to distribute, or distribution of marijuana and cocaine; conspiracy to defraud the United States in violation of 18 U.S.C. Sec. 371 (1982); and income tax evasion and filing false income tax returns in violation of 26 U.S.C. Secs. 7201, 7206(1) (1982). Susan M. Lueth, his wife, Timothy McCarthy, and Patrick J. McMahon were convicted of various counts relating to conspiracy, possession, and distribution of marijuana and cocaine. On appeal, the defendants raise as error the district court's denial of their motions to suppress evidence seized pursuant to a warrant based on what they contend was a fatally deficient affidavit; the intrusion of the district judge into their trial as a prosecutor; the district court's refusal to sever the tax charges from the drug charges; and the submissibility of the continuing criminal enterprise charge against Amel Lueth. We affirm the convictions on each of the counts as to each of the defendants.

The evidence produced at the four-week trial of Amel Lueth and his codefendants established that Amel Lueth was the head of a major marijuana and cocaine trafficking organization centered in Council Bluffs, Iowa, and Omaha, Nebraska. He began distributing large quantities of marijuana to Raymond Hughes in Council Bluffs prior to 1979. In the summer of 1979, Lueth traveled to Florida, intending to purchase marijuana. He was unable to obtain the marijuana, however, and he returned to Council Bluffs with four kilograms of cocaine. There was evidence that the following year the Lueth organization was embarrassed by the sale of a large quantity of cocaine containing spoiled diluent. This cocaine was later "reconstituted" and resold with a different diluent.

There was evidence that Lueth's mother, Laura Lueth, was involved in his activities. In 1979, Lueth set up a corporation through which he received funds from his parents' farm in Manilla, Iowa. In turn, he invested some of the profits of his drug operation in the farm, purchasing land and farm equipment. The Lueth organization also used the farm as a storage facility for drugs and money.

By 1981 Lueth and his associates were using the facilities and premises of Horticulture Supply, Inc., located in Omaha, to receive and repackage large quantities of marijuana, some of which came from Illinois, Delaware, and Florida. Lueth organized trips to transport this marijuana, and often flew to Florida to direct the actual purchase of the drugs, leaving codefendant Patrick McMahon or government witness Greg Bixler to drive a van to Florida and back to Iowa, carrying the marijuana. Bixler purchased a fraudulent birth certificate from Lueth at the Horticulture Supply facility; Lueth was once seen with a dozen such certificates, used to obtain fraudulent driver's licenses, in a briefcase.

Bixler and Sally Pflug, another government witness, were expelled from the Lueth organization in 1981. Both had been accused by Lueth of stealing $100,000 of Lueth's money. Evidently, all three were also involved in a romantic triangle. After their expulsion, Laura Lueth discovered the money in the family freezer at the Iowa farm in a package labelled "rib eyes."

By 1983, the Lueth organization was purchasing high-quality Mexican marijuana from a supplier in Tucson, Arizona. There was evidence that Lueth employed McMahon to haul the marijuana to Council Bluffs. Additional purchases were evidently made in San Francisco, California. On March 24, 1983, law enforcement officials searched the residences of Lueth and several of his codefendants. This search led to the discovery of records of the trafficking activities, and the seizure of a GMC motor home, a Saab motor vehicle, a large sum of money, and quantities of marijuana, cocaine, and Valium.

Shortly after the 1983 search, Lueth and several other members of his organization moved away from Council Bluffs. There was evidence, however, that they continued to use Council Bluffs and Omaha as drug storage and distribution centers during 1983 and 1984. Following the return of an indictment against Lueth and his codefendants on February 8, 1985, federal and state officials searched the Manilla, Iowa, farm and discovered five bags of silver coins, records detailing Lueth's investments in farm land and equipment, and records of ongoing narcotics trafficking.

As only Amel Lueth raises the question of the sufficiency of the evidence to support his conviction, we need not further elaborate upon the facts developed at the trial. Insofar as further factual details are relevant to the contentions of the parties, we will relate them presently.

A single multi-count, multi-party indictment was filed against Amel Lueth, Susan Lueth, Patrick McMahon, Timothy McCarthy, and other alleged members of the Lueth organization. All defendants moved to suppress the fruits of the 1983 search because the affidavit underlying the warrant refers to a confidential informant as being of proven reliability when the agent making the affidavit knew that the Federal Bureau of Investigation, the Douglas County Sheriff's office, and the Omaha Police Department had ceased using him as an informant. The district court denied this motion.

The trial followed. Amel Lueth was convicted under Count I of the indictment of engaging in a continuing criminal enterprise (CCE) in violation of 21 U.S.C. Sec. 848. Amel Lueth, Susan Lueth, Patrick McMahon, and Timothy McCarthy were convicted under Count II of conspiracy to distribute marijuana and cocaine in violation of 21 U.S.C. Sec. 846. The jury convicted Amel Lueth of possession of cocaine with intent to distribute in violation of 21 U.S.C. Secs. 841(a)(1), 841(b)(1)(A) and 18 U.S.C. Sec. 2 under Count III. Amel Lueth was convicted of possession with intent to distribute marijuana under Count VI, in violation of 21 U.S.C. Secs. 841(a)(1), 841(b)(1)(A) and 18 U.S.C. Sec. 2. He was convicted under Count VII of an additional count of possession with intent to distribute cocaine. Amel and Susan Lueth were convicted under Count VIII of the lesser included offense of possession of diazapam (Valium) in violation of 21 U.S.C. Secs. 841(a)(1), 841(b)(2). Amel Lueth and Susan Lueth were convicted under Count IX of an additional count of possession with intent to distribute cocaine. Both were also convicted under Count X of an additional count of possession with intent to distribute marijuana. Amel Lueth was convicted under Count XI of another count of possession with intent to distribute cocaine. Under Counts XIII, XIV, XV, and XVI, Amel Lueth was convicted of conspiracy to defraud the United States of income tax, in violation of 18 U.S.C. Sec. 371, filing false income tax returns in 1979 and 1980, in violation of 26 U.S.C. Sec. 7206(1), and income tax evasion, in violation of 26 U.S.C. Sec. 7201.

Amel Lueth was sentenced to twenty years on Count I, and received sentences ranging from one year to fifteen years on the remaining counts. All sentences were to run concurrently; twenty years without parole was the maximum sentence imposed. Susan Lueth was sentenced to one year and one day on Count II and three months on Count VIII, to run concurrently, and was placed on three years probation following release as to Counts IX and X. Patrick McMahon was sentenced to five years on Count II. Timothy McCarthy was sentenced to four years on Count II. Various other members of the Lueth organization, not involved in this appeal, pled guilty or were convicted by the jury, and were sentenced under the several counts of the indictment. Some defendants were dismissed or acquitted.

On appeal, Amel and Susan Lueth, and Timothy McCarthy contend that the district court erred in refusing to suppress the evidence seized in March, 1983, pursuant to a search warrant that they argue was based on an affidavit that did not establish probable cause and was deficient under Franks v. Delaware, 438 U.S. 154, 98 S.Ct. 2674, 57 L.Ed.2d 667 (1978). Amel Lueth also contends that the trial judge abandoned his neutral role and injected himself into the trial as prosecutor. Patrick McMahon argues that the district court erred in refusing to sever the tax charges against Amel Lueth from the drug charges against the remaining defendants. And, finally, Amel Lueth argues that the government did not make a submissible case against him on the charge that he engaged in a continuing criminal enterprise under Count I of the indictment.

I.

Amel Lueth, Susan Lueth, and Timothy McCarthy argue that the district court erred in denying their motion to suppress the evidence seized during the search of their premises on March 24, 1983. They contend that the affidavit underlying the search warrant, prepared by Donald E. Nelson, a special agent of the Drug Enforcement Agency, contains a material, deliberate falsehood, and...