United States v. Lynch, 091318 FED9, 10-50219

Docket Nº:10-50219, 10-50264
Opinion Judge:ROGERS, CIRCUIT JUDGE.
Party Name:United States of America, Plaintiff-Appellee, v. Charles C. Lynch, Defendant-Appellant. United States of America, Plaintiff-Appellant, v. Charles C. Lynch, Defendant-Appellee.
Attorney:Alexandra Wallace Yates (argued), Deputy Federal Public Defender; Hilary Potashner, Federal Public Defender; Office of the Federal Public Defender, Los Angeles, California; for Defendant-Appellant. David P. Kowal (argued), Assistant United States Attorney; Robert E. Dugdale, Chief, Criminal Divis...
Judge Panel:Before: John M. Rogers, Jay S. Bybee, and Paul J. Watford, Circuit Judges. WATFORD, Circuit Judge, dissenting
Case Date:September 13, 2018
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit
 
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United States of America, Plaintiff-Appellee,

v.

Charles C. Lynch, Defendant-Appellant.

United States of America, Plaintiff-Appellant,

v.

Charles C. Lynch, Defendant-Appellee.

Nos. 10-50219, 10-50264

United States Court of Appeals, Ninth Circuit

September 13, 2018

Argued and Submitted April 13, 2018 Pasadena, California

Appeal from the United States District Court Nos. 2:07-cr-00689-GW-1, 2:07-cr-00689-GW-1 for the Central District of California George H. Wu, District Judge, Presiding

Alexandra Wallace Yates (argued), Deputy Federal Public Defender; Hilary Potashner, Federal Public Defender; Office of the Federal Public Defender, Los Angeles, California; for Defendant-Appellant.

David P. Kowal (argued), Assistant United States Attorney; Robert E. Dugdale, Chief, Criminal Division; André Birotte Jr., United States Attorney; United States Attorney's Office, Los Angeles, California; for Plaintiff-Appellee.

Joseph D. Elford, Americans for Safe Access, Oakland, California, for Amicus Curiae Americans for Safe Access.

Jenny E. Carroll, Professor of Law, Seton Hall University, Newark, New Jersey, for Amici Curiae Criminal Procedure Professors.

Paula M. Mitchell, Reed Smith LLP, Los Angeles, California, for Amici Curiae Members of Congress.

Michael V. Schafler, Benjamin B. Au, Arwen R. Johnson, and Isabel Bussarakum, Caldwell Leslie & Proctor PC, Los Angeles, California, for Amici Curiae Senators Mark Leno and Mike McGuire, and Former Senator Darrell Steinberg.

Before: John M. Rogers, [*] Jay S. Bybee, and Paul J. Watford, Circuit Judges.

SUMMARY

[**]

Criminal Law

The panel (1) affirmed Charles Lynch's conviction for conspiracy to manufacture, possess, and distribute marijuana, as well as other charges related to his ownership of a marijuana dispensary in Morro Bay, California; (2) on the government's cross-appeal, remanded for resentencing; and (3) instructed the district court on remand to make a factual determination as to whether Lynch's activities were in compliance with state law.

The panel held that the district court's exclusion of testimony from a lawyer about Lynch's phone call to the DEA, as well as a recording of this lawyer discussing that call on a radio program, was correct because both pieces of evidence were hearsay to which no exception applied.

The panel held that the district court did not abuse its discretion in excluding repetitive and irrelevant evidence about Lynch's compliance with local laws.

The panel held that evidence of a dispensary employee's marijuana sale to a government agent was not more prejudicial than probative, and was generally harmless given Lynch's concession of factual guilt. The panel held that the district court correctly excluded as hearsay a statement the employee made to an investigator that Lynch "didn't know anything about this deal."

The panel held that there was no error in the district court's handling of a number of pieces of evidence that Lynch contends were impermissibly inflammatory, and that any would be harmless.

The panel rejected Lynch's claim that evidence he subsequently discovered about the United States' prosecution priorities should have been disclosed to him pursuant to Brady v. Maryland. The panel held that the evidence was not exculpatory of Lynch or otherwise relevant to his case.

The panel held that because Lynch did not show facts providing a basis on which a reasonable jury could find that he was entitled to the defense of entrapment by estoppel, he was not entitled to present that defense in the first place, and the district court did not err in any decisions it made with respect to it.

The panel held that the district court did not commit any error by warning during voir dire against jury nullification. The panel held that the admonition was an appropriate exercise of a district court's duty to ensure that a jury follows the law, and was additionally justifiable given that the need for the warning was a risk that Lynch's counsel had invited.

The panel held that the district court did not abuse its discretion in not allowing him to inform the jury of the mandatory minimum sentence that he faced if convicted.

The panel rejected the Lynch's challenges to the district court's handling of jury communications because the district court did not actually permit any ex parte communications and the other limitations were reasonable exercises of a district court's power to manage its trial proceedings.

On the government's cross-appeal, the panel held that the district court erred in not applying the five-year mandatory-minimum sentence under 21 U.S.C. § 841(b)(1)(B)(viii) on the ground that Lynch was eligible for the safety valve set forth in 18 U.S.C. § 3553(f). The panel held that Lynch was not eligible for the safety valve, given his role leading the dispensary, an organization involving more than five participants; and that Lynch was therefore required to be sentenced to the five-year mandatory minimum. The panel rejected the government's request that the case be reassigned to another district judge on remand.

The panel did not need to reach the question of whether a congressional appropriations rider (enacted following the filing of this appeal), which this court has interpreted to prohibit the federal prosecution of persons for activities compliant with state medical marijuana laws, operates to annul a properly obtained conviction. The panel explained that a genuine dispute exists as to whether Lynch's activities were actually legal under California state law, and therefore remanded to the district court for a factual determination as to state-law compliance.

Dissenting, Judge Watford would reverse and remand for a new trial because, in his view, in trying to dissuade the jury from engaging in nullification, the district court violated Lynch's constitutional right to trial by jury, and the government can't show that this error was harmless beyond a reasonable doubt.

OPINION

ROGERS, CIRCUIT JUDGE.

I. Introduction

Charles Lynch ran a marijuana dispensary in Morro Bay, California, in violation of federal law. He was convicted of conspiracy to manufacture, possess, and distribute marijuana, as well as other charges related to his ownership of the dispensary. In this appeal, Lynch contends that the district court made various errors regarding Lynch's defense of entrapment by estoppel, improperly warned jurors against nullification, and allowed the prosecutors to introduce various evidence tying Lynch to the dispensary's activities, while excluding allegedly exculpatory evidence offered by Lynch. However, Lynch suffered no wrongful impairment of his entrapment by estoppel defense, the anti-nullification warning was not coercive, and the district court's evidentiary rulings were correct in light of the purposes for which the evidence was tendered. A remand for resentencing is required, though, on the government's cross-appeal of the district court's refusal to apply a five-year mandatory minimum sentence, which unavoidably applies to Lynch.

Following the filing of this appeal and after the submission of the government's brief, the United States Congress enacted an appropriations provision, which this court has interpreted to prohibit the federal prosecution of persons for activities compliant with state medical marijuana laws. Lynch contends that this provision therefore prohibits the United States from continuing to defend Lynch's conviction. We need not reach the question of whether the provision operates to annul a properly obtained conviction, however, because a genuine dispute exists as to whether Lynch's activities were actually legal under California state law. Remand will permit the district court to make findings regarding whether Lynch complied with state law.

II. Background

The facts of this case are largely unchallenged on appeal. In 2005 and into early 2006, Charles Lynch operated a marijuana store in Atascadero, California, before neighbor complaints caused the town to shut down Lynch's operations. In 2006 Lynch moved his activities to Morro Bay, opening what he called Central Coast Compassionate Caregivers (CCCC) in April of that year. Lynch's dispensary proved to be a popular one, employing around 10 subordinates and selling $2.1 million in marijuana and marijuana-related products during the period in which the dispensary operated.

Lynch's dispensary soon also attracted the attention of federal authorities. In March 2007, the DEA obtained a search warrant and raided Lynch's home, along with the dispensary. Lynch continued to operate CCCC, but his efforts there were short-lived. On July 13, 2007, the United States indicted Lynch on five counts: conspiracy to...

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