United States v. Robins

Decision Date14 December 2016
Docket Number15-1893(L),15-2530 (Con)
PartiesUNITED STATES OF AMERICA, Appellee, v. JERRY ROBINS, AKA Jerry Robbins, DBA Finish Line Auto Sales, AKA Finish Line Auto, Defendant-Appellant.
CourtU.S. Court of Appeals — Second Circuit

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007 IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT'S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION "SUMMARY ORDER"). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

At a stated term of the United States Court of Appeals for the Second Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 14th day of December, two thousand sixteen.

PRESENT: DENNY CHIN, SUSAN L. CARNEY, Circuit Judges, RICHARD M. BERMAN, District Judge.*

FOR APPELLEE:

MONICA J. RICHARDS, Assistant United States Attorney, for William J. Hochul, Jr., United States Attorney for the Western District of New York, Buffalo, New York.

FOR DEFENDANT-APPELLANT:

BRUCE R. BRYAN, Syracuse, New York.

Appeal from the United States District Court for the Western District of New York (McAvoy, J.1).

UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that the judgment of the district court is AFFIRMED IN PART and REVERSED IN PART, and the case is REMANDED.

Defendant-appellant Jerry Robins appeals a June 2, 2015 judgment of the district court, convicting him, after a jury trial, of three counts of money laundering, three counts of willfully violating a transaction-reporting law, and one count of doing so while violating another law of the United States. The district court sentenced Robins principally to 63 months' imprisonment and entered a final order of forfeiture of $70,275 and specified real property. On appeal, Robins argues: (1) the evidence was insufficient to sustain his convictions; (2) the jury was erroneously instructed; and (3) he was denied his Sixth Amendment right to counsel. We assume the parties' familiarity with the underlying facts, procedural history, and issues on appeal.

1. Sufficiency of the Evidence

Robins contends that the evidence was insufficient to convict him of money laundering and transaction-reporting violations.

In an appeal challenging the sufficiency of the evidence, we review the evidence in "the light most favorable to the government and credit every inference that the jury might have drawn in the government's favor." United States v. Salameh, 152 F.3d 88, 151 (2d Cir. 1998) (per curiam). "A verdict of guilty may be based entirely on circumstantial evidence as long as the inferences of culpability drawn from the circumstances are reasonable." United States v. MacPherson, 424 F.3d 183, 190 (2d Cir. 2005). "Nonetheless, a conviction based on speculation and surmise alone cannot stand." United States v. D'Amato, 39 F.3d 1249, 1256 (2d Cir. 1994) (citations omitted).

a. Money Laundering

To convict a defendant of money laundering, the government must prove:

(1) that the defendant conducted a financial transaction; (2) that the transaction in fact involved the proceeds of specified unlawful activity . . .; (3) that the defendant knew that the property involved in the financial transaction represented the proceeds of some form of unlawful activity; and (4) that the defendant knew [the] transaction was designed in whole or in part [either] to conceal or disguise the source . . . of those proceeds [or to avoid transaction-reporting requirements].

United States v. Maher, 108 F.3d 1513, 1527-28 (2d Cir. 1997); see 18 U.S.C. § 1956(a)(1)(B)(ii). Robins argues that the evidence was insufficient to prove that certaincustomers used drug conspiracy proceeds to purchase cars from his dealership in Buffalo, New York ("Finish Line"), or that he knew such money was the proceeds of unlawful activity. We conclude that the evidence was sufficient to convict on Counts 3 and 8 of the indictment, but not on Count 7. We discuss each count, in turn.

Count 3 concerned a February 27, 2006 sale of a 2001 GMC Yukon to Robert DeWitt Stevenson for $25,000 in cash. Robins argues that evidence that he knew Stevenson paid with proceeds of illegal activity was lacking. The argument fails. Stevenson testified that the money came from his drug distribution business. Although Stevenson also testified that he never spoke to Robins about drugs, the government presented evidence that Robins (1) failed to report the all cash sale to the Financial Crime Enforcement Network ("FinCEN"), see 31 U.S.C. § 5331(a) (requiring such reporting), (2) registered the vehicle to Stevenson's stepfather, and (3) placed a lien on the Yukon despite receiving full payment. A reasonable jury could have concluded from this evidence that Robins knew that the money came from illegal sources and sought to conceal its origin. Accordingly, the evidence was sufficient to convict Robins of money laundering on Count 3.

Count 8 concerned a June 9, 2007 sale of a 2004 Infiniti to Henry Lloyd and Tyrone Pennick for $34,455. Robins again argues that evidence that he knew they paid with proceeds of illegal activity was lacking. Lloyd testified, however, that Lloyd and Pennick purchased the vehicle with proceeds of their cocaine wholesaling business,Lloyd had told Robins that he sold drugs, and Pennick told him that they "got to go get cashier checks and money orders because [Robins] wouldn't take [$35,000] cash." App. at 401. When asked if he knew why Robins would not take the cash, Lloyd testified: "Because it was over 10,000, I guess" -- the amount that triggers federal reporting requirements. App. at 402. The jury reasonably could have drawn this same inference. Accordingly, the evidence was sufficient to convict Robins of money laundering on Count 8.

Count 7 concerned an April 27, 2007 purchase of a 2002 Chevrolet Suburban by Jerome Davis for $10,820. Robins contends that the evidence was insufficient to prove that those funds were "in fact . . . the proceeds of" a drug distribution conspiracy. 18 U.S.C. § 1956(a)(1) (emphasis added); 18 U.S.C. § 1956(c)(7)(A); § 1961(1); 21 U.S.C. § 841. Drawing all reasonable inferences in favor of the government, the evidence established that: (1) Davis pled guilty to possession of four grams of a controlled substance in 2004 and served a year and a half in jail; (2) in 2007, Davis accompanied Robins to an auction where Robins bid on the Suburban and Davis paid Robins for it in cash; (3) the Suburban was registered to Davis's fiance, Tameca Love; (4) dealership receipts listed inconsistent prices for the Suburban, one greater than $10,000 and the other less; (5) Robins did not report the transaction to FinCEN; and (6) Davis and Love testified that they did not deal drugs and paid with legitimate money.

In denying Robins's motion for judgment of acquittal, the district court reasoned that one could infer that drug proceeds were involved because Davis was "connected to drugs" and other circumstances suggested an effort to avoid reporting. S. App. at 10. We disagree that a rational jury could infer on this evidence that the 2002 Suburban was purchased in 2007 with drug proceeds.

Davis' testimony that, in 2004, he pled guilty to possession of four grams of a controlled substance is the only evidence that he was "connected to drugs." Id. at 10. The record is devoid of evidence of other salient facts, even which substance he was convicted of possessing. Our cases are clear that a person's mere possession of a small quantity of drugs, without more, does not support an inference that the person is dealing drugs. See, e.g., United States v. Boissoneault, 926 F.2d 230, 234 (2d Cir. 1991) (evidence insufficient to sustain conviction for possession with intent to distribute where "the quantity of cocaine at issue, 5.31 grams (.19 oz.), was not inconsistent with personal use" and defendant possessed no other instrumentalities of the drug trade); United States v. Wallace, 532 F.3d 126, 129 (2d Cir. 2008) ("[A] defendant who holds narcotics solely for personal use is in possession; one who delivers or transfers narcotics to another -- for consideration or gratis -- is distributing."). The same logic applies here. No rational juror could infer that Davis dealt drugs in 2007 solely because he was convicted of possessing four grams of an unspecified controlled substance in 2004.

Nor, in the absence of evidence tying the $10,820 to narcotics activity, could a rational juror have found that Davis purchased the Suburban with proceeds of such activity. Cf. D'Amato, 39 F.3d at 1256 ("[T]he government must do more than introduce evidence at least as consistent with innocence as with guilt."); United States v. Martinez, 54 F.3d 1040, 1045 (2d Cir. 1995) (Calabresi, J., concurring) ("[T]he aggregation of many small pieces of data . . . every one [of which] is in equipoise . . . can never establish proof beyond a reasonable doubt [because] [t]he adding of zeros to zeros, no matter how many, cannot amount to more than zero."). Accordingly, the judgment of conviction on Count 7 is reversed.

b. Transaction Reporting

Section 5331 of Title 31 of the United States Code required Robins to file a report with FinCEN whenever "in the course of [his] . . . business, [he] receive[d] more than $10,000 in coin or currency in 1 transaction (or 2 or more related transactions)." 31 U.S.C. § 5331.2 A willful failure to do so is a crime. 31 U.S.C. § 5322. "To establish that a defendant 'willfully violated' [a transaction-reporting requirement], the Government must prove that the defendant acted with knowledge that his conduct was unlawful." Raizlaf v. United States, 510 U.S. 135, 137 (1994). Therefore, to convict Robins under § 5322(a) here, the government had to...

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