U.S. v. Tamez, 89-30320

• Decision Date: 30 July 1991
• Docket Number: No. 89-30320,89-30320
• Citation: 941 F.2d 770
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Frank Javier TAMEZ, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 770

941 F.2d 770

UNITED STATES of America, Plaintiff-Appellee, v. Frank Javier TAMEZ, Defendant-Appellant.

No. 89-30320.

United States Court of Appeals Ninth Circuit.

Argued and Submitted Feb. 7, 1991.

Decided July 30, 1991.

Howard N. Schwartz, Dauber, Bartheld & Schwartz, Yakima, Wash., for defendant-appellant.

Donald E. Kresse, Asst. U.S. Atty., Yakima, Wash., for plaintiff-appellee.

Appeal from the United States District Court for the Eastern District of Washington.

Before WIGGINS, BRUNETTI and NELSON, Circuit Judges.

BRUNETTI, Circuit Judge:

Frank Javier Tamez appeals his conviction and sentence under 21 U.S.C. § 856(a)(2), for making available a building for the purpose of narcotics trafficking. We have jurisdiction under 28 U.S.C. § 1291 and affirm in part and reverse and remand in part.

I. Background

In October 1987 the DEA began an investigation of defendant Tamez after receiving information that his used car dealership, consisting of five lots in and around Yakima, Washington, was being used to distribute cocaine. On October 22 an undercover officer purchased an ounce of cocaine from Sigifredo Escamilla, a Tamez employee, at one of the lots. Sigifredo told the officer that Tamez was his source of cocaine and that through Tamez he could supply whatever drugs were required.

Gerald Dauenhauer, a government witness, testified that he purchased more than three kilograms of cocaine from Sigifredo at the dealership over several months in 1987. He testified that Sigifredo referred to the drug distribution scheme as "Frank's operation" and claimed to be selling fifty kilograms per month from the dealership.

There was testimony that Robert Wilhelm, a government witness, purchased cocaine at the dealership. On one occasion Sigifredo drove a dealership-owned car to his repair shop and cocaine that was concealed within the vehicle was removed at the shop for distribution. Sigifredo told Wilhelm that Tamez was using proceeds from the drug distribution effort to purchase cars for the dealership.

David Reed was employed by Tamez to repossess cars. He testified that on three occasions Tamez instructed him to travel in a company car to a rest area in northern California, to leave the vehicle with the keys under the seat, and to return to Yakima in a designated car parked at a rest area across the freeway. The return vehicle was driven back to the dealership though Reed testified he never saw these vehicles on the lot for sale. For each trip, Reed was paid $1200 though he received only between $50 and $125 for a repossession. He also testified that he was aware of other such car swaps that did not appear to be related to car sales or repossessions.

Elizabeth Evans, a government informant and agent in this investigation, made a total of five cocaine purchases from Tamez employees during the period of the operation. Some actual drug transfers took place at the lot and a kilogram purchase occurred, apparently for security reasons, at the residence of a Tamez employee. Evans also testified that Tamez explained to her that he had financed his car business with the proceeds of narcotics sales.

Terry Evans, also a government agent, went to work for Tamez as a mechanic. He described several conversations between himself and Tamez in which Tamez acknowledged that his employees were engaged in cocaine trafficking and did not express any objection to these activities.

Teresa Ball, also a government witness, testified that she attempted to purchase drugs on the premises of the used car lot and that on one occasion she smoked cocaine with Tamez, in his office, together with Vince Williams, a Tamez employee.

In November 1988 agents searched Tamez' residence and found $50,000 and a gun. In April 1989 a Washington grand jury indicted Tamez for conspiracy to distribute cocaine, 21 U.S.C. § 846, and making available for use a building for the purpose of narcotics trafficking, 21 U.S.C. § 856(a)(2). A jury found Tamez not guilty of the conspiracy charge, but found him guilty of the § 856(a)(2) violation. He was sentenced to 37 months imprisonment, five years supervised release, and a $50,000 fine.

II. Discussion

A. Applicability of 21 U.S.C. § 856(a)(2)

Tamez argues that the jury verdict is unsound because § 856(a)(2) was not intended to be applied in this kind of case. Interpretation of a statute is a question of law this court reviews de novo. United States v. Arrellano, 812 F.2d 1209, 1211 (9th Cir.1987), amended, 835 F.2d 235 (1987).

Section 856(a)(2) states:

[I]t shall be unlawful to--

(2) manage or control any building, room, or enclosure, either as an owner, lessee, agent, employee, or mortgagee, and knowingly and intentionally rent, lease, or make available for use, with or without compensation, the building, room, or enclosure for the purpose of unlawfully manufacturing, storing, distributing, or using a controlled substance.

Tamez argues that application of this statute to the facts of this case was improper because the statute was intended only to apply to "crack houses" or manufacturing operations. He argues the statute requires the building be intended by the defendant to be used for the purpose of manufacturing or other prohibited activities. The buildings in this case, he asserts had no purpose other than use in the operation of a successful used car dealership.

As Tamez suggests, most cases applying § 856 involve large scale drug storage facilities, manufacturing operations, or crack houses. See United States v. Wicker, 848 F.2d 1059 (10th Cir.1988) (methamphetamine lab); United States v. Martinez-Zyas, 857 F.2d 122 (3rd Cir.1988) (cocaine warehouse and packaging facility); United States v. Bethancurt, 692 F.Supp. 1427 (D.C.D.C.1988) (crack house); United States v. Restrepo, 698 F.Supp. 563 (E.D.Pa.1988) (cocaine warehouse). Because there was no evidence of storage, manufacturing or the kind of use associated with a crack house here, Tamez argues the statute is inapplicable.

Tamez also relies on the "short title" of § 856 which is "Establishment of manufacturing operations." He argues that the statute was not intended to subject to liability every person who owns a building where drug activities are conducted. The statute, in his view, should not be applied in this case because there was no evidence of manufacturing operations. Finally, Tamez cites a synopsis of § 856 in the Congressional Record which describes the statute as "Outlaw[ing] operation of houses or buildings, so called 'crack houses' where 'crack,' cocaine and other drugs are manufactured and used." H.R. 5484, 99th Cong., 2nd Sess., 132 Cong.Rec. S13779 (daily ed. September 26, 1986). Because there was no evidence that Tamez' dealership was used as a crack house, he argues, it was error to apply the statute in this case.

Tamez ignores the plain language and application of the statute. Although the short title and the Congressional Record synopsis refer to manufacturing and crack houses, the words of the statute clearly imply more expansive coverage. First, the words of the statute are not ambiguous: the statute prohibits allowing the use of a building for "manufacturing, storing, distributing, or using a controlled substance." There is no reason to believe that this language was intended to apply only to storage facilities and crack houses. There was evidence that the dealership was used as a distribution center and this is sufficient, under the plain language of the statute to constitute a section 856(a)(2) violation.

Tamez' assertion that the statute requires that he intend to use the building for a prohibited purpose under section 856(a)(2) also ignores the plain meaning and interrelation of the two § 856 provisions. Section 856(a)(1) states: "[I]t shall be unlawful to--(1) knowingly open or maintain any place for the purpose of manufacturing, distributing, or using any controlled substance...." This provision applies to purposeful activity and as such, if illegal purpose is, as Tamez suggests, a requirement of 856(a)(2), the section would overlap entirely with 856(a)(1) and have no separate meaning.

The fifth circuit addressed this issue in United States v. Chen, 913 F.2d 183 (5th Cir.1990). In that case, Chen was convicted of violating both 856(a)(1) and (2). The trial court charged the jury that with regard to both § 856 provisions, the defendant is guilty of knowing violations if she deliberately ignored unlawful conduct that should have been obvious. The fifth circuit reversed with regard to the section 856(a)(1) conviction, deciding that § 856(a)(1) requires purpose or intention to manufacture, distribute, or use a controlled substance whereas

§ 856(a)(2) is designed to apply to the person who may not have actually opened or maintained the place for the purpose of drug activity, but who has knowingly allowed others to engage in those activities by making the place "available for use ... for the purpose of unlawfully" engaging in such activity. Therefore, under § 856(a)(2) the person who manages or controls the building and then rents to others, need not have the express purpose in doing so that drug related activity is engaged in by others (i.e., others have the purpose).

Id. at 190.

We reject Tamez' argument on the logic of Chen. Both provisions of § 856 must have meaning, and from the language of the provision it is clear that (a)(1) was intended to apply to deliberate maintenance of a place for a proscribed purpose, whereas (a)(2) was intended to prohibit an owner from providing a place for illegal conduct, and yet to escape liability on the basis either of lack of illegal purpose, or of deliberate ignorance. The government established that a significant degree of distribution activities emanated from Tamez' dealership. Although there was no evidence that the business or its buildings were established or maintained for the purpose of drug activities, section 856(a)(2) requires only that proscribed activity...