United States v. Farias

• Decision Date: 01 September 2016
• Docket Number: No. 14–15804,14–15804
• Parties: United States of America, Plaintiff–Appellee, v. Antonio Farias, Defendant–Appellant.
• Court: U.S. Court of Appeals — Eleventh Circuit

836 F.3d 1315

United States of America, Plaintiff–Appellee,

v.Antonio Farias, Defendant–Appellant.

No. 14–15804

United States Court of Appeals, Eleventh Circuit.

Date Filed: September 1, 2016

Amit Agarwal, Aileen Cannon, Wifredo A. Ferrer, Alison Whitney Lehr, Francisco Raul Maderal, Jr., Kathleen Mary Salyer, Emily M. Smachetti, U.S. Attorney's Office, Miami, FL, for Plaintiff–Appellee.

Richard Carroll Klugh, Jr., Law Offices of Richard C. Klugh, Miami, FL, for Defendant–Appellant.

Before MARCUS and FAY, Circuit Judges, and FRIEDMAN,^* District Judge.

MARCUS

, Circuit Judge:

Over the course of about 10 months, Antonio Farias purchased more than 18 million unstamped Marlboro cigarettes from undercover agents of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”), at a significantly below-market price, and he arranged to have the cigarettes transported for sale on an Indian reservation in upstate New York. The agents told Farias they had stolen the cigarettes from cargo trucks. Farias was charged and convicted at trial of one count of conspiring, in violation of 18 U.S.C. § 371

, to traffic in stolen goods, 18 U.S.C. § 2314, and to traffic in contraband cigarettes, 18 U.S.C. § 2342(a). The district court sentenced Farias to 36 months in prison and ordered him to forfeit his proceeds from the offense, which the parties agreed were $331,426. On appeal, Farias challenges: (1) the denial of his motion to dismiss the indictment as untimely; (2) the denial of his motion to compel discovery or alternatively to dismiss the indictment based on claimed government misconduct; (3) the sufficiency of the evidence to sustain his conviction for conspiracy; (4) the district court's jury instructions; and (5) the court's authority to enter a forfeiture judgment at the sentencing hearing, where it had failed to enter a preliminary forfeiture order as soon as practicable after the verdict, as required under Fed. R. Crim. P. 32.2. After careful review, and having the benefit of oral argument, we affirm.

I.

In 2005, special agents of the ATF began investigating Farias for unlawfully trafficking in cigarettes in Miami–Dade County, Florida, based on a tip they had received from a confidential informant. On June 20, 2006, a second confidential informant working with the special agents sold Farias more than one million unstamped Marlboro cigarettes.¹ After that transaction, ATF placed the investigation on hold for about a year because the second confidential informant was serving a federal prison sentence. Thereafter, on seven separate occasions between June 23, 2008, and April 2, 2009, undercover ATF special agents Peter Alles and Richard Checo, working with the first confidential informant, sold Farias a total of more than 18 million unstamped Marlboro cigarettes. The agents sold Farias the cigarettes at a price per carton of only $19.50—significantly below the going list price, which was between $27 and $36 per carton. Generally, the list price, which includes federal but not state taxes, is the lowest possible price at which a direct wholesaler can buy Marlboro cigarettes. During the course of each of the seven cigarette transactions, the agents recorded their conversations with the defendant, Farias.

After purchasing the cigarettes from the undercover agents, Farias immediately resold them to Stephen Valvo, who had arranged with his and Farias's mutual friend to haul the cigarettes to an Indian reservation in Salamanca, New York. Special Agent Alles explained at trial that, in order to evade detection by law-enforcement officers, cigarette traffickers often transport contraband cigarettes for sale on Indian reservations in New York and in other northeastern states. Farias initially sold Valvo the cigarettes at a price per carton of $21.95, but later increased the price to $24.95.

On June 21, 2013, a federal grand jury sitting in the Southern District of Florida initially indicted Farias and Valvo on one count of conspiring to traffic in contraband cigarettes, in violation of 18 U.S.C. §§ 371²

and 2342(a),³ and seven substantive counts of trafficking in contraband cigarettes, in violation of 18 U.S.C. §§ 2342(a) and 2. The indictment specifically charged that the conspiracy ran from April 7, 2006, through April 2, 2009. Moreover, it alleged 15 overt acts as part of the conspiracy, including the June 20, 2006 transaction between Farias and the second confidential informant, the 7 transactions that occurred between June 23, 2008, and April 2, 2009, and 7 wire transfers between Valvo and Farias during that time frame.⁴ The indictment was sealed until Farias was arrested on June 16, 2014.

On July 17, 2014, the federal grand jury returned a superseding indictment, which again charged both Farias and Valvo with conspiring to violate 18 U.S.C. § 371

. The superseding indictment alleged that the conspiracy, again, included trafficking in contraband cigarettes, in violation of § 2342(a), and that it also involved trafficking in stolen goods, in violation of 18 U.S.C. § 2314.⁵ Notably, the superseding indictment dropped the seven substantive § 2342(a) counts against Farias and Valvo, and shortened the time span of the conspiracy to a period commencing on or about June 4, 2008, and ending on or about April 2, 2009. The superseding indictment re-alleged the same overt acts that originally had been alleged in the initial charge (overt acts numbers 2–15), except that it dropped the June 20, 2006 transaction between Farias and the second confidential informant (overt act number 1).

Farias moved the district court to dismiss the superseding indictment because it was allegedly untimely under the governing five-year statute of limitations found in 18 U.S.C. § 3282(a)

,⁶ since it was filed more than five years after the last alleged overt act, which had occurred on April 2, 2009. In the alternative, the defendant claimed that the government had violated the Due Process Clause of the Fifth Amendment by waiting until June 21, 2013 to bring the initial charge. He claimed that both the superseding and original indictments should be dismissed as being untimely. The district court denied each argument, reasoning that, while the superseding indictment was indeed filed outside the five-year statutory limitations period, it plainly related back to the original, timely indictment because no broadening of the charges occurred. The district court also denied Farias's due-process claim because he failed to show either actual prejudice or that the delay was an intentional construction used by the government to obtain tactical advantage over him. See United States v. Marion, 404 U.S. 307, 324, 92 S.Ct. 455, 30 L.Ed.2d 468 (1971).

Farias proceeded to trial. On the morning trial commenced, he moved the court to compel the government to produce details of the ATF's investigation, including the agency's dealings with Phillip Morris and other cigarette companies. Alternatively, he urged the district court to dismiss the superseding indictment based on claimed outrageous government misconduct. Again, the district court denied Farias's motions, characterizing the allegations that cigarette companies were financing ATF's enforcement activities as being “pretty speculative.”

In its case-in-chief, the government played each of the agents' recorded conversations with Farias for the jury, and also provided clarifying testimony. In the recordings, the undercover agents repeatedly indicated that they were dealing with stolen goods. Thus, for example, Special Agent Checo told Farias prior to the June 23, 2008 transaction that the conspirators' cigarette supply was unpredictable because they could only get the product “[w]hen it falls” off the back of a truck. Checo explained that this terminology was designed and intended to convey that the undercover agents had stolen the cigarettes from cargo trucks that were transporting the merchandise. Notably, Farias responded: “Of course .... I know how it works.” An employee of Altria Group Distribution Company—Marlboro and Phillip Morris's parent company—testified that Phillip Morris maintains a consistent supply of Marlboro cigarettes, so that the product is always available for purchase through legitimate channels.

In another recording, made on October 31, 2008, Special Agent Alles told Farias that he wanted to change trucks and let everything “cool down a bit” before selling the cigarettes. Alles explained that he was speaking in code, telling Farias that “because the product is stolen, I have to move it ... basically to avoid detection by law enforcement.” Farias's response was: “Of course.” In fact, Farias then told the undercover agent that he didn't want to spend “too much time” at the warehouse, where the sale would take place. Special Agent Alles explained that Farias wanted to minimize his time at the warehouse because he was concerned that customs agents might come to inspect the warehouse and ask to see documentation for the cigarettes. In still another recording, made on November 6, 2008, Farias said he wanted to break up larger transactions into smaller shipments, which would be less likely to attract law-enforcement attention.

Farias had also explained to Special Agent Checo, prior to the July 24, 2008 transaction, that they would have nothing to worry about once the cigarettes made it onto the New York Indian reservation, where state and federal law-enforcement authorities couldn't investigate the cigarettes for sale. During that conversation, Farias specifically asked undercover agent Checo to confirm if the cigarettes he was purchasing were stolen. Checo responded, “You don't want to know the answer to that.” Farias then said: “Yeah, because I'm afraid. I mean, so many cases. They're after that, you know.”

Valvo, who had entered a plea and agreed to cooperate with the government and to testify against Farias, explained that he knew the cigarettes he bought from Farias had been stolen, and that they were unstamped. At the...