United States v. Mann

• Decision Date: 13 October 2015
• Docket Number: No. 2:14–CR–14–D.,2:14–CR–14–D.
• Citation: 140 F.Supp.3d 513
• Court: U.S. District Court — Eastern District of North Carolina
• Parties: UNITED STATES of America, Plaintiff, v. Harry C. MANN, Defendant.

140 F.Supp.3d 513

UNITED STATES of America, Plaintiff,

v.Harry C. MANN, Defendant.

No. 2:14–CR–14–D.

United States District Court, E.D. North Carolina, Northern Division.

Signed Oct. 13, 2015.

Felice Corpening, Susan B. Menzer, Joshua B. Royster, Stephen A. West, U.S. Attorney's Office, Raleigh, NC, Dennis M. Duffy, U.S. Dept. of Justice, Raleigh, NC, for Plaintiff.

Elliot Sol Abrams, Cheshire Parker Schneider & Bryan, PLLC, Raleigh, NC, Raymond C. Tarlton, Tarlton Law, PLLC, Raleigh, NC, for Defendant.

ORDER

JAMES C. DEVER III, Chief Judge.

On December 11, 2014, the court held a pretrial conference and set this matter for trial for April 13, 2015 [D.E. 49]. On April 5, 2015, Harry C. Mann ("Mann" or "defendant") filed a motion for an order directing the United States ("government") to produce to this court for in camera review the criminal history records of the witnesses it intends to call at trial to determine if there was exculpatory or impeachment material in those records that should have been disclosed under Brady v. Maryland, 373 U.S. 83, 83 S.Ct. 1194, 10 L.Ed.2d 215 (1963), Giglio v. United States, 405 U.S. 150, 92 S.Ct. 763, 31 L.Ed.2d 104 (1972), and their progeny. See [D.E. 61]. On April 6, 2015, the court granted Mann's motion [D.E. 67]. On April 8, 2015, the court held a pretrial conference. See [D.E. 70]. At the conference, the government admitted that it had not produced to defense counsel a full criminal history concerning one of its witnesses, Rudy Lozano, an alleged coconspirator who had already entered a guilty plea in a related case and had agreed to cooperate with the government as part of his plea agreement. See [D.E. 78] 16–18; Plea Agreement at 3, United States v. Lozano, No. 2:13–CR–11 (E.D.N.C. May 9, 2013), [D.E. 17]. The court ordered the government to immediately produce all Giglio material to defense counsel and to file a notice with the court by April 9, 2015, confirming that the government had complied with its Giglio obligations. See [D.E. 78] 18–19, 30.

On April 11, 2015, Mann moved to dismiss the indictment for "wrongful deprivation of defendant's right to counsel of his choice" or, alternatively, for the release of seized assets [D.E. 75]. On April 12, 2015. Mann moved to dismiss the indictment for Brady and Giglio violations [D.E. 76]. On April 13, 2015, Mann filed a "notice of additional facts" regarding his motions to dismiss [D.E. 77].

In light of the allegations raised in Mann's motions and notice, the court continued the trial and ordered the government to respond to Mann's motions [D.E. 79]. On April 17, 2015, the government filed a notice of compliance with Giglio [D.E. 81]. On May 1, 2015, the government responded in opposition to Mann's motions to dismiss [D.E. 86, 87]. On May 8, 2015, Mann replied [D.E. 89, 90]. On May 22, 2015, the government filed a surreply to Mann's motion to dismiss for Brady and Giglio violations [D.E. 93]. On May 27, 2015, the government filed a surreply to Mann's motion to dismiss for wrongful deprivation of the right to counsel [D.E. 94].

On June 16, 2015, Mann filed a motion to dismiss the indictment for grand jury and other government misconduct [D.E. 96], a motion for discovery [D.E. 97], a motion to dismiss counts one, two, and three for failure to state an offense [D.E. 98], and a motion for a subpoena [D.E. 99]. On June 22, 2015, the government responded to Mann's motion to dismiss the indictment for grand jury and other misconduct [D.E. 105]. On June 23, 2015, Mann replied [D.E. 106]. On June 26, 2015, the government responded to Mann's motion for discovery. See [D.E. 110, 112]. On June 27, 2015, Mann replied [D.E. 111]. On June 30, 2015, the government responded to Mann's motion to dismiss counts one, two, and three for failure to state an offense [D.E. 113]. On July 9, 2015, the government filed a second response to Mann's motion to dismiss for grand jury and other government misconduct [D.E. 114].

On July 24, 2015, the court held oral argument on all pending motions. At oral argument, the court granted in part and denied in part Mann's motion for discovery, denied Mann's motion to dismiss counts one, two, and three for failure to state an offense, and granted Mann's motion for a subpoena. See [D.E. 124]. As explained below, the court denies defendant's remaining motions to dismiss, but grants defendant's alternative motion for the release of seized assets.

I.

In August 2010, the Naval Criminal Investigative Service ("NCIS") began investigating allegations that Mann, manager of the Navy Dare County Bombing Range ("Range"), was stealing government property. The alleged scheme involved acquiring surplus equipment from the Defense Reutilization and Marketing Office ("DRMO") at no cost and then selling the property.

NCIS Special Agent Bates learned that the Range had acquired at least $8,376,183 in property from DRMO between December 2006 and August 2010. See [D.E. 87–2]; [D.E. 87] 12–13 & 13 n. 8 (claiming that the figure was closer to $12 million). Agent Bates also learned from Inspector Gillam of the North Carolina Division of Motor Vehicles that Mann was selling functional pieces of equipment at a fraction of their value, that the scheme involved a man named Rudy Lozano, and that a Dresser front-end loader valued at $64,774 that was supposed to be at the Range was on Jerry Mansfield's property. Agent Bates confirmed via surveillance that the Dresser front-end loader was on Mansfield's property and had been painted yellow to cover its original Army green color. See [D.E. 87] 2–3.

During January 2011, agents interviewed Navy employees at other bombing ranges to learn the procedures for disposing of surplus government property (whether functional or destroyed). Agents learned, among other things, that ordnance technicians had to certify that all items removed from a Navy range were ordnance-free before removal. See [D.E. 87–3].

In March 2011, NCIS Agent Ryan temporarily replaced Agent Bates. [D.E. 87] 3. On March 3, 2011, Inspector Gillam told Agent Ryan that he had conducted a traffic stop of a truck containing military helicopter parts. Id. 3–4. According to the driver, Rudy Lozano had obtained the helicopter, largely whole, from the Range, cut it up, and sold the parts to local metal recyclers. See id.

On March 7, 2011, Agent Ryan interviewed Lozano. Id. 4. Lozano told Agent Ryan that he had taken property from the Range since 2004 and, in return, paid Mann cash kickbacks. Id. Lozano estimated earning approximately $100,000 from the property he removed. Id. Lozano said he would assist the investigation, but that Mann had barred Lozano from the Range in 2010. Id. Lozano stated that he believed that Mann replaced Lozano with John Williams (and others) because Williams and others would pay Mann more than Lozano would pay. Id. Lozano also told Agent Ryan how he paid Mann, that Mann demanded cash, and that Mann insisted that Lozano make payments to Mann only when no one else was present. See [D.E. 87] 4.

On March 8, 2011, Agent Ryan obtained a federal search warrant to seize the government property on Manfield's property. See id.; [D.E. 87–10] ¶ 22(a). On March 8, 2011, agents executed the search warrant and seized the yellow Dresser front-end loader and a trailer with a U.S. Navy license plate. See [D.E. 87] 4; [D.E. 87–10] ¶ 22(a). Agents interviewed Mansfield, who told agents that Williams owned the Dresser front-end loader. [D.E. 87–5]. Mansfield also told agents that he regularly drove a truck onto the Range, removed equipment from the Range, and hauled the equipment to recyclers in North Carolina and Virginia. Id. Mansfield examined a photograph of Mann and identified Mann as the "bossman." See id.

On March 31, 2011, agents interviewed Williams, who agreed to cooperate in the investigation. Id. Williams told the agents that he had been removing property from the Range for about a year, selling the property, and paying cash to Mann. Id. According to Williams, he removed approximately 171,000 pounds of aluminum from the Range, sold it for 80 cents a pound, received $137,000, and paid Mann $59,000. Id. Williams also said that he still owed Mann another $1,100. See id.

Agent Ryan asked Williams to be part of an undercover operation concerning Mann, and Williams agreed. Id. 5–6. On April 1, 2011, Williams met with Mann while Mansfield and Jerry Brickhouse, who worked for Williams, removed several large metal boxes from the Range. Id. 6. Mansfield then took the metal boxes to Sims Metal Management ("Sims") in Chesapeake, Virginia, and received a check payable to Williams for $7,920. Id. The next weekend, Mansfield returned to the Range, picked up six loads of large metal boxes, hauled them to Sims, and received a check from Sims payable to Williams for $51,964. Id.

Williams provided both checks to Agent Ryan. Id. With Inspector Gillam's help, the agents opened an undercover account at Southern Bank and deposited the two checks, which totaled $59,884. See id.

During the weekend of April 16, 2011, Mann and Williams supervised while Mansfield and others removed more metal boxes from the Range. Id. Williams, who was wearing an audio recording device, told Mann that he estimated the boxes weighed a total of 200,000 pounds. Id.; [D.E. 87–4] 5–6. At fifteen cents per pound, Williams told Mann that he estimated Mann's payoff would be $30,000. [D.E. 87–4] 5–6; [D.E. 87–5] 6. Williams also handed Mann $1,100 and said, "That's the ... money for the rest of the aluminum runway." [D.E. 87] 7; [D.E. 87–4] 7.

After the weekend of April 16, 2011, Williams became ill and could not travel.

[D.E. 87] 7. Mann, however, continued to call Williams about removing property from the Range and paying Mann the cash that Mann was due. Id. On May 12, 2011, Williams told Agent Ryan that Mann had called Williams at approximately 10:00 a.m. and asked where his money was and when Williams could return to the Range to remove 60 to 90 aluminum bomb fins. See id.

At Agent Ryan's...