United States v. Mutschler

• Decision Date: 07 January 2016
• Docket Number: CR14–328 TSZ
• Parties: United States of America, Plaintiff, v. Richard Thayne Mutschler, Defendant.
• Court: U.S. District Court — Western District of Washington

152 F.Supp.3d 1332

United States of America, Plaintiff,
v.
Richard Thayne Mutschler, Defendant.

CR14–328 TSZ

United States District Court, W.D. Washington, at Seattle.

Signed January 7, 2016

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Roscoe Jones, US Attorney's Office, Seattle, WA, for Plaintiff.

ORDER

Thomas S. Zilly, United States District Judge

THIS MATTER has prompted the Court to question the now nationwide practice of routinely approving plea agreements containing unilateral waivers of the right to appeal. Recent statistics indicate that, each year, roughly 97% of all federal convictions result from guilty pleas. See Missouri v. Frye, ––– U.S. ––––, 132 S.Ct. 1399, 1407, 182 L.Ed.2d 379 (2012) ; see also Dept. of Justice, Bureau of Justice Statistics, Sourcebook of Criminal Justice Statistics Online, Table 5.22.2010 (http://www.albany.edu/sourcebook/pdf/t5222010.pdf). Yet, in perhaps no other context involving such unequal bargaining positions have the courts so fully abdicated their responsibility for evaluating the conscionability of the parties' agreement. Federal prosecutors in virtually every district have been permitted to demand that defendants entering guilty pleas waive almost the entire panoply of rights, including the right to appeal.

Guilty pleas are generally negotiated outside the courtroom, between just the lawyers, without the defendant, and in the absence of any witness or recording mechanism. See Robert E. Scott & William J. Stuntz, Plea Bargaining as Contract, 101 Yale L.J. 1909, 1911 (1992). This “scandalously casual” process of “horse trading,” which determines who goes to prison and for how long, is “not some adjunct to the criminal justice system; it is the criminal justice system.” Id. at 1911–12 (emphasis in original). To ensure that this system does not become “so deregulated that the conditions essential to assuring basic fairness are undermined,” United States v. Perez, 46 F.Supp.2d 59, 61 (D.Mass.1999), district courts should rigorously assess whether a unilateral waiver of appellate rights is acceptable in each case. See United States v. Melancon, 972 F.2d 566, 568 (5th Cir.1992) (observing that “a district court's refusal to accept such a waiver ... would be within its discretion”). In this particular case, the Court is persuaded that the Government's attempt to require defendant to waive his right to

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challenge future sentencing decisions is fundamentally unjust, and the Government's motion, docket no. 33, seeking reconsideration of the Court's oral ruling striking the appellate waiver in the Plea Agreement, docket no. 32, is DENIED.

Background

By Indictment filed on November 5, 2014, docket no. 1, defendant Richard Thayne Mutschler was charged with four counts of mail fraud, pursuant to 18 U.S.C. § 1341, and four counts of wire fraud, pursuant to 18 U.S.C. § 1343. Each count of mail fraud occurred on a different date between December 24, 2009, and March 4, 2010, and involves a different check addressed to the Brookfield Condominium Association (the “Association”), for which defendant served as president. Each count of wire fraud occurred on a different date from November 10, 2009, through December 8, 2009, and involves a different online credit card payment from the Association's account. All eight counts of the Indictment are alleged to be part of the same scheme and artifice to defraud the Association.

The parties negotiated a Plea Agreement pursuant to which defendant entered a plea of guilty to the first count of mail fraud in exchange for the Government's agreement to dismiss all other counts in the Indictment and not to prosecute defendant for any other offenses known at the time of the Plea Agreement. For purposes of calculating the applicable United States Sentencing Guidelines (“USSG”) range, the parties agreed that the base offense level is 7, and that a 12–level increase is appropriate because the loss at issue exceeded $250,000.¹ See USSG § 2B1.1. This amount far exceeds the total of all checks and credit card payments described in the eight counts of the Indictment. See Indictment at 5–6 (docket no. 1) (indicating an aggregate of only $11,819.01). Under the terms of the Plea Agreement, the parties “are free to argue the application of any other provisions of the United States Sentencing Guidelines.” Plea Agreement at ¶ 6 (docket no. 32). During the colloquy that accompanied defendant's change of plea before the undersigned, the Government indicated that it would likely seek a two-point increase for violation of a position of trust, a two-point increase for using a sophisticated scheme, and “another one or two enhancements” for reasons that had, at the moment, escaped the Assistant United States Attorney. Tr. (Oct. 19, 2015) at 14 (docket no. 31). The possibly 8–level increase proposed by the Government would more than double defendant's USSG range.²

“Although plea bargaining is a matter of criminal jurisprudence, a plea

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bargain itself is contractual in nature and ‘subject to contract-law standards.’ ” United States v. Krasn, 614 F.2d 1229, 1233 (9th Cir.1980) (quoting United States v. Arnett, 628 F.2d 1162, 1164 (9th Cir.1979) ). The terms of a plea agreement are interpreted according to “objective standards” and, in the event of a dispute, the “dispositive question” is what the parties “reasonably understood.” Arnett, 628 F.2d at 1164. Plea agreements are contracts of adhesion, and must be strictly construed against the Government. See Standard Oil Co. of Cal. v. Perkins, 347 F.2d 379, 383 n. 5 (9th Cir.1965) (describing an adhesion contract as a standard form “prepared by one party and submitted to the other on a ‘take it or leave it’ basis”); see also United States v. Mezzanatto, 513 U.S. 196, 216, 115 S.Ct. 797, 130 L.Ed.2d 697 (1995) (Souter, J., dissenting ) (“As the Government conceded during oral argument, defendants are generally in no position to challenge demands for these waivers, and the use of waiver provisions as contracts of adhesion has become accepted practice.”); All Pac. Trading, Inc. v. Vessel M/V Hanjin Yosu, 7 F.3d 1427, 1431 (9th Cir.1993) (observing that contracts of adhesion are strictly construed against the drafter).

As presented to the Court, the Plea Agreement indicated that defendant waived the right to challenge the Court's calculation of the USSG range. See Plea Agreement at ¶ 14(a) (stricken) (docket no. 32). Paragraph 14(a) stated that defendant waived:

to the full extent of the law ... any right conferred by Title 18, United States Code, Section 3742, to challenge, on direct appeal, the sentence imposed by the Court,

provided such sentence is within or below the USSG range. Id. This provision is asymmetric, requiring defendant to waive appellate rights, but leaving the Government fully able to seek review if it does not agree with the Court's calculation of the USSG range or if the Court imposes a sentence below the guideline range. See 18 U.S.C. §§ 3742(b)(2) & (3). Paragraph 14(a) is “standard language,” Tr. (Oct. 19, 2015) at 16:23 (docket no. 31), and the unilateral waiver at issue was neither specifically negotiated nor, in any real sense, optional.

Before accepting defendant's plea of guilty to Count I of the Indictment, the Court struck Paragraph 14(a) of the Plea Agreement, and set a ten-day deadline for the Government to object. Tr. (Oct. 19, 2015) at 16–20 (docket no. 31). The Government timely set forth its objections in the motion for reconsideration, docket no. 33, now before the Court. Defendant acquiesced in the motion in an effort to forestall the Government from trying to rescind the Plea Agreement. See Resp. (docket no. 34). As a result, the Court has not received the benefit of defendant's (or his attorney's) views. Thus, despite the Court's refusal to accept the unilateral waiver of appellate rights, the waiver has done its job of muting the party with the most at stake and inhibiting the development of balanced jurisprudence.

Discussion

A. Authority to Strike Paragraph 14(a)

Striking a presentence waiver of appellate rights is not without precedent. See Perez, 46 F.Supp.2d at 63 ; see also United States v. Teeter, 257 F.3d 14, 27 (1st Cir.2001) (severing the appeal waiver because the district court failed to make an adequate inquiry during the plea colloquy and orally contradicted its terms); cf. United States v. Banos–Mejia, 588 Fed.Appx. 522 (9th Cir.2014) (refusing to enforce an ambiguous waiver of the right to appeal); United States v. Gonzales–Garcia, 541 Fed.Appx. 764 (9th Cir.2013) (same); United States v. Baltazar–Neri, 540 Fed.Appx. 630 (9th Cir.2013) (same);

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United States v. Aguilar–Balbuena, 475 Fed.Appx. 222 (9th Cir.2012) (same). These decisions are consistent with contract principles allowing courts to refuse to enforce, or to strike, terms that are unconscionable or against public policy. See United States v. Ready, 82 F.3d 551, 559 (2d Cir.1996) (“courts may apply general fairness principles to invalidate particular terms of a plea agreement” (citing Restatement...