United States v. Sou

• Decision Date: 30 November 2011
• Docket Number: CRIMINAL NO. 09-00345 SOM
• Parties: UNITED STATES OF AMERICA, Plaintiff, v. ALEC SOUPHONE SOU, (01) MIKE MANKONE SOU, (02) Defendants.
• Court: U.S. District Court — District of Hawaii

UNITED STATES OF AMERICA, Plaintiff,

v.ALEC SOUPHONE SOU, (01) MIKE MANKONE SOU, (02) Defendants.

CRIMINAL NO. 09-00345 SOM

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF HAWAII

Dated: November 30, 2011

ORDER DENYING MOTION FOR ATTORNEYS' FEES AND EXPENSES

ORDER DENYING MOTION FOR ATTORNEYS' FEES AND EXPENSES

I. INTRODUCTION.

The United States charged Defendants Alec and Mike Sou with obtaining forced labor from forty-four Thai nationals between 2003 and 2005, and with related offenses. Shortly after trial began, the United States dismissed all charges against the Sous. The Sous now seek to recover attorneys' fees and costs pursuant to the Hyde Amendment on the ground that the case against them was frivolous. The court denies the motion.

II. BACKGROUND.

A grand jury first indicted the Sous on August 27, 2009. See Indictment ("Original Indictment"), Aug. 27, 2009, ECF No. 1. The Original Indictment charged (1) conspiracy to commit forced labor in violation of 18 U.S.C. §§ 371 and 1589; (2) conspiracy to commit document servitude in violation of 18 U.S.C. §§ 371 and 1592, allegedly in the course of violating § 1589; and(3) conspiracy to commit visa fraud in violation of 18 U.S.C. §§ 371 and 1546. Id.

The Original Indictment alleged that the Sous had participated in a scheme to recruit workers from Thailand to work on the Sous' commercial farm, Aloun Farms, on Oahu, and that the workers were then forced to work under threat of serious financial harm. Original Indictment ¶ 17.

Each of the Sous entered into a plea agreement pursuant to which each pled guilty to conspiracy to commit forced labor. See Memorandum of Plea Agreement, Jan. 13, 2010, ECF Nos. 38, 39; Acceptance of Plea of Guilty, Feb. 18, 2010, ECF No. 49. While the court accepted the guilty pleas, it left the separate issue of acceptance of the plea agreements for the sentencing hearing.

The sentencing proceedings spanned more than one hearing. In the course of those hearings, the Sous, in the hope of avoiding lengthy prison terms, contested certain factual assertions that, if relied on by the court, might have enhanced their sentences. The Sous argued vigorously that their guilty pleas remained in effect in spite of their challenges to various factual assertions. Thus, for example, Mike Sou's counsel argued, "Again, at no time will I suggest to you that they are not, in our opinion, guilty of participation in this conspiracy. But what I want to argue to you is that none of the victims said anything to implicate these defendants in the most serious andlurid allegations that have been made." Transcript of Proceedings on July 19, 2010, for Continued Sentencing/Various Motions ("Sentencing Hearing 1") at 73:20-24, ECF No. 118. Defense counsel continued, "We do not in any way seek to withdraw those pleas or to in any way minimize the fact that the conspiracy occurred and that these two men were part of it." Id. at 81:7-9.

This court expressed concern about whether the Sous were retracting various admissions made in the plea agreements. Thus, for example, the court asked, "And is Alec Sou agreeing with paragraph 25 of his plea agreement, which says that he told the Thai workers that he would send them home to Thailand if they were disobedient, failed to follow directions, or if they tried to leave, knowing of the workers' debts in Thailand and the workers' fear of losing their family homes and land?" In response, Alec Sou indicated that he wanted a chance to speak with his attorney. Id. at 114:24 - 115:5. See also id. at 119:16 - 124:25 (Alec Sou stating that he himself did not do what is asserted in paragraph 25 of his plea agreement).

The court also questioned whether, if the Sous were retracting certain factual admissions contained in their plea agreements, there was sufficient factual support for their guilty pleas. Id. at 124:5 - 126:1. Ultimately, at the sentencing hearing on September, 9, 2010, citing concerns about whether theSous were disputing provisions in the plea agreements they had signed, the court rejected the plea agreements. Transcript of Proceedings on Sept. 9, 2010, for Continued Sentencing/Various Motions ("Sentencing Hearing 2") at 27:22 - 28:4, ECF No. 119. Once the court rejected the plea agreements, it advised the Sous that they could withdraw their guilty pleas, which they did. Sentencing Hearing 2 at 29:6-16. The case was then set for trial.

On October 27, 2010, a twelve-count First Superseding Indictment was filed. First Superseding Indictment ("Indictment"), Oct. 27, 2010, ECF No. 127. This Indictment charged the Sous with one count of conspiracy to commit forced labor, five counts of forced labor, two counts of document servitude, one count of visa fraud conspiracy, two counts of harboring aliens for financial gain, and one count of obstructing or impeding an official proceeding. Id.

Jury selection began on July 27, 2011, and concluded the next day. See ECF Nos. 266-67. On July 29, 2011, the parties presented their opening statements, and two witnesses for the United States testified. Following a break that included the weekend, trial resumed on August 2, 2011. On that day, the jury heard testimony by Matee Chowsanitphon, a major witness for the United States who had pled guilty to a crime related to the charges against the Sous. In the course of being cross-examinedby the defense, Chowsanitphon testified that he had pled guilty after learning from counsel for the United States during grand jury proceedings that he had broken the law by obtaining recruiting fees from Thai workers. In fact, such fees were not illegal at the time in issue. The lead counsel for the United States at trial was the attorney who had conducted the grand jury proceeding in issue. During trial, that attorney, in response to the court's questions out of the presence of the jury, conceded that her statement about the illegality of recruiting fees before the grand jury was inaccurate. Shortly thereafter, she informed the court that she was experiencing symptoms of a pre-existing medical condition, and the court ended trial proceedings early that day. Chowsanitphon's testimony continued the next day, August 3, 2011, without that attorney but with the continued participation of other attorneys for the United States who had been active throughout trial proceedings.

On August 4, 2011, the United States moved to dismiss all charges against the Sous. The court granted the motion. See ECF No. 289. On September 2, 2011, the Sous brought the present motion to recover attorneys' fees pursuant to the Hyde Amendment. Defendants Alec Souphone Sou and Mike Mankone Sou's Notice of Motion and Motion for Attorney's Fees and Expenses Pursuant to Hyde Amendment ("Motion"), Sept. 2, 2011, ECF No. 299.

III. LEGAL STANDARD.

The Hyde Amendment permits a prevailing defendant in a criminal prosecution to recover legal fees upon showing that the United States' position was either vexatious, frivolous, or in bad faith. United States v. Capener, 608 F.3d 392, 400 (9th Cir. 2010) (citing 18 U.S.C. § 3006A note). The Amendment provides in relevant part:

the court, in any criminal case (other than a case in which the defendant is represented by assigned counsel paid for by the public) . . . may award to a prevailing party, other than the United States, a reasonable attorney's fee and other litigation expenses, where the court finds that the position of the United States was vexatious, frivolous, or in bad faith, unless the court finds that special circumstances make such an award unjust.

Pub. L. No. 105-119, S 617, 111 Stat. 2440, 2519 (1997) (reprinted in 18 U.S.C. § 3006A, historical and statutory notes). The Hyde Amendment test is "disjunctive--satisfaction of any one of the three criteria (vexatiousness, frivolousness, or bad faith) should suffice by itself to justify an award." United States v. Braunstein, 281 F.3d 982, 994 (9th Cir. 2002). A moving defendant bears the burden of proving entitlement to fees. Id.

The Hyde Amendment targets "prosecutorial misconduct, not prosecutorial mistake." Capener, 608 F.3d at 401 (quoting Braunstein, 281 F.3d at 995). "[M]ere faulty judgment is not vexatious, frivolous, or in bad faith." Id. (citing UnitedStates v. Tucor Intern., Inc., 238 F.3d 1171, 1170 (9th Cir. 2001)). The court is not to engage in "an exercise in 20/20 hindsight based solely on reasonableness." Id.

IV. ANALYSIS.

The Sous argue that the charges in the Indictment were unfounded and that the United States failed to conduct a sufficient investigation before bringing this case. As a result, the Sous contend, the United States' position throughout the proceedings was frivolous under the Hyde Amendment.

While the Hyde Amendment does not define the term "frivolous," the Ninth Circuit has defined a "frivolous" case as "one that is groundless. . . . [A] case is frivolous when the government's position was foreclosed by binding precedent or so obviously wrong as to be frivolous." Capener, 608 F.3d at 401 (quoting United States v. Manchester Farming Partnership, 315 F.3d 1176, 1183 (9th Cir. 2003)). A showing that a jury may have had reasonable doubt is not enough, as saying "in hindsight that a case could not be proved beyond a reasonable doubt is hardly the same as showing that the case was unfounded." United States v. Sherburne, 249 F.3d 1121, 1127 (9th Cir. 2001).

The United States urges the court to look at the case as a whole to determine whether it was frivolous, rather than assessing individual allegations or charges. See United States v. Shaygan, 652 F.3d 1297, 1315 (11th Cir. 2011) ("The HydeAmendment allows an award of attorney's fees and costs against the United States only when its overall litigating position was vexatious, frivolous, or in bad faith."); United States v. Schneider, 395 F.3d 78, 90 (2d Cir. 2005) (Hyde Amendment "does not allow an award for any instance of vexatious, frivolous, or bad-faith conduct. An award is allowed only where the court finds that 'the...