U.S. v. McAleer, s. 97-8047

• Decision Date: 10 March 1998
• Docket Number: Nos. 97-8047,97-8049 and 97-8051,97-8048,s. 97-8047
• Citation: 1998 WL 101804,138 F.3d 852
• Parties: 98 CJ C.A.R. 1228 UNITED STATES of America, Plaintiff-Appellee, v. James L. McALEER, Defendant-Appellant. UNITED STATES of America, Plaintiff-Appellee, v. Mary A. GILMORE, Defendant-Appellant. UNITED STATES of America, Plaintiff-Appellee, v. Shirley D. McALEER, Defendant-Appellant. UNITED STATES of America, Plaintiff-Appellee, v. Anthony J. CARTA, Defendant-Appellant.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 852

138 F.3d 852

98 CJ C.A.R. 1228

UNITED STATES of America, Plaintiff-Appellee, v. James L. McALEER, Defendant-Appellant.

UNITED STATES of America, Plaintiff-Appellee, v. Mary A. GILMORE, Defendant-Appellant.

UNITED STATES of America, Plaintiff-Appellee, v. Shirley D. McALEER, Defendant-Appellant.

UNITED STATES of America, Plaintiff-Appellee, v. Anthony J. CARTA, Defendant-Appellant.

Nos. 97-8047, 97-8048, 97-8049 and 97-8051.

United States Court of Appeals Tenth Circuit.

March 10, 1998.

David A. Kubichek and Lisa E. Leschuck, Assistant United States Attorneys (David D. Freudenthal, United States Attorney, with them on the brief), Casper, WY, for Plaintiff-Appellee.

Scott J. Engelhard, Seattle, WA, for Defendant-Appellant James L. McAleer.

James H. Barrett, Assistant Federal Public Defender, Cheyenne, WY, for Defendant-Appellant Mary A. Gilmore.

Thomas B. Jubin, Cheyenne, WY, for Defendant-Appellant Shirley D. McAleer.

Jo Ann Fulton, Laramie, WY, for Defendant-Appellant Anthony J. Carta.

Before TACHA, McWILLIAMS, and BALDOCK, Circuit Judges.

BALDOCK, Circuit Judge.

Defendants appeal the district court's denial of their respective motions to dismiss the indictment on grounds that the Double Jeopardy Clause of the Fifth Amendment bars their retrial. ¹ Our jurisdiction arises under 28 U.S.C. § 1291. See Abney v. United States, 431 U.S. 651, 662, 97 S.Ct. 2034, 2041-42, 52 L.Ed.2d 651 (1977). We affirm.

I.

This case centers around a fraudulent investment scheme orchestrated by James Gilmore to induce individuals to invest in a plan referred to as the "Master Transaction." ² The "Master Transaction" involved $157 trillion allegedly held on deposit in various European banking institutions by the Mafia, the United States Central Intelligence Agency, the Vatican, and a mysterious group called the "Illuminati." Potential investors were told that once James Gilmore coordinated the release of these funds, investors would receive a return on their investment at the rate of 2,000 to one. James Gilmore hired International Trading, Inc., (hereinafter "ITI") to sell shares in the "Master Transaction."

In October 1992, the Securities Exchange Commission (hereinafter "SEC"), obtained a temporary restraining order prohibiting Gilmore from soliciting money through ITI in violation of federal securities laws. Gilmore then began obtaining investors through Morgan Investment Pool, Inc., which employed Defendant James McAleer, and the Allington Association of Business Administrators (hereinafter "AABA"), of which McAleer was a member of the board of directors. McAleer, along with his wife Shirley, began soliciting investors for various Gilmore programs representing that investors would receive a 2,000 to one rate of return once the "Master Transaction" or "European Fortune" was completed. Incredibly, Defendants obtained large sums of money from investors, including approximately $1,072,000 from AABA members.

In October 1994, James McAleer formed another entity, the Rafter Lafter Association (hereinafter "RLA"), to promote James Gilmore's scheme. RLA hired Defendant Anthony Carta to serve as a bodyguard for Defendant Mary A. Gilmore. Carta and Gilmore traveled throughout the United States during 1994 and 1995 promoting the "Master Transaction" and soliciting investors for RLA. During the four-year operation of the scheme, Defendants collected approximately $1.8 million from investors. The proceeds were distributed among Defendants and James Gilmore. ³

On January 26, 1996, Defendants were indicted for their involvement in the "Master Transaction" scheme. Mary A. Gilmore was charged with violating 18 U.S.C. § 1956(h), conspiracy to launder money. Shirley McAleer was charged with violating 18 U.S.C. § 1956(h) and 18 U.S.C. §§ 1343, 2, wire fraud and aiding and abetting. James McAleer was charged with violating 18 U.S.C. § 1956(h); 18 U.S.C. § 1343; 18 U.S.C. § 1341, mail fraud; and 15 U.S.C. §§ 77q(a)(1)-(3) & § 77x, securities fraud. Anthony Carta was charged with violating 18 U.S.C. § 1956(h) and 18 U.S.C. § 1343.

The Defendants' trial commenced on November 6, 1996. Almost six weeks into the trial, during her cross-examination, the Government asked Mary Gilmore about the assertion of her Fifth Amendment privilege against self-incrimination during earlier SEC proceedings. Gilmore was asked if she remembered "taking the Fifth Amendment 41 times" during those proceedings. Counsel for Gilmore objected and moved for a mistrial. The district court denied the motion and overruled the objection on the ground that the questioning was relevant to Gilmore's credibility. The cross-examination of Gilmore resumed, with the Government referring approximately twenty-five times to Gilmore's use of her Fifth Amendment privilege during a 1992 SEC deposition and a 1994 civil contempt proceeding against James Gilmore. The Government also asked Gilmore if she had told her co-defendants that she had previously invoked her Fifth Amendment privilege.

The following day Defendants joined in a renewed motion for mistrial. The district court denied the motion, but agreed to give a curative instruction directing the jury to only use Gilmore's assertion of her Fifth Amendment privilege in assessing Gilmore's credibility. On December 20, 1996, after a seven-week trial, a jury returned guilty verdicts on all the counts.

In various post-trial motions, all of the Defendants sought judgments of acquittal or new trials. The Government conceded that its questioning of Gilmore regarding her Fifth Amendment privilege constituted clear error, and on February 14, 1997, the district court granted Gilmore a new trial. On March 14, 1997, the district court conducted a hearing regarding the remaining Defendants' post-trial motions. On April 15, 1997, the district court denied the motions for judgment of acquittal, concluding that the evidence was sufficient to sustain the guilty verdicts. The district court granted Defendants' motions for a new trial, however, holding that the attack by the Government on Gilmore's use of her Fifth Amendment privilege prejudiced all of Defendants and was not harmless error. All of the Defendants then filed motions to dismiss the indictment on double jeopardy grounds. On June 5, 1997, the district court denied Defendants' motions and this appeal followed.

II.

We review de novo the district court's denial of a motion to dismiss the indictment on double jeopardy grounds. United States v. Cordoba, 71 F.3d 1543, 1545 (10th Cir.1995). The Double Jeopardy Clause of the Fifth Amendment protects defendants from repeated prosecutions or multiple punishments for the same offense. United States v. Dinitz, 424 U.S. 600, 606, 96 S.Ct. 1075, 1078-79, 47 L.Ed.2d 267 (1976). As part of this protection, the Double Jeopardy Clause affords a criminal defendant the right "to have his trial completed by a particular tribunal." Wade v. Hunter, 336 U.S. 684, 689, 69 S.Ct. 834, 837, 93 L.Ed. 974 (1949). However, the Double Jeopardy Clause does not "guarantee" that the State will enforce the criminal laws in one proceeding. Oregon v. Kennedy, 456 U.S. 667, 672, 102 S.Ct. 2083, 2087-88, 72 L.Ed.2d 416 (1982). Double jeopardy does "not go so far as to compel society to so mobilize its decisionmaking resources that it will be prepared to assure the defendant a single proceeding free from harmful governmental or judicial error." United States v. Jorn, 400 U.S. 470, 484, 91 S.Ct. 547, 556, 27 L.Ed.2d 543 (1971).

Defendants argue that under Oregon v. Kennedy, 456 U.S. 667, 102 S.Ct. 2083, 72 L.Ed.2d 416 (1982), and the line of cases preceding it, their retrial is barred. The district court, applying the analysis set forth in Kennedy, determined retrial was not barred. In Kennedy, the Supreme Court expounded on a prosecutorial misconduct exception to the general rule that if a mistrial is declared at the defendant's request, double jeopardy does not bar reprosecution for the same offense. Kennedy, 456 U.S. at 673, 102 S.Ct. at 2088. This narrow exception articulated in Kennedy provides that if governmental misconduct was intended to "goad" the defendant into moving for a mistrial, double jeopardy does indeed bar reprosecution. Id. at 676, 102 S.Ct. at 2089-90.

Defendants argue that the prosecutor's repeated questioning of Mary Gilmore about her Fifth Amendment privilege was intended to provoke them into seeking a mistrial. Therefore, Defendants maintain, under the Kennedy exception for prosecutorial misconduct, their retrial would violate double jeopardy. Defendants' reliance on Kennedy is misplaced, however, because no mistrial was declared in this case. The district court never granted Defendants' motions for a mistrial. The case proceeded to the jury and guilty verdicts were returned. Defendants did not obtain a mistrial, but instead succeeded in having the district court set aside the guilty verdicts. Although Defendants attempt to characterize the district court's order setting aside the jury verdicts and granting a new trial as the functional equivalent of a mistrial, Defendants miss a crucial distinction. The Kennedy prosecutorial misconduct exception is a narrow one, designed to protect the defendant's right to "have his trial completed before the first jury empaneled to try him." Kennedy, 456 U.S. at 673, 102 S.Ct. at 2088. Without this exception a prosecutor could intentionally provoke a defendant into requesting a mistrial and the defendant would then be prevented from later invoking a double jeopardy bar to his retrial. Such a result would render a defendant's "valued right to complete his trial before the first jury" a "hollow shell." Id. Defendants, however, do not require such protection because without the declaration of a mistrial, they were not deprived of their "valued right" to have their case submitted to the first jury, and perhaps have the dispute end with an acquittal. For these reasons, we conclude that the mistrial...