US v. Hunter, 92-CR-80770-DT.

• Decision Date: 02 September 1994
• Docket Number: No. 92-CR-80770-DT.,92-CR-80770-DT.
• Citation: 863 F. Supp. 462
• Parties: UNITED STATES of America, Plaintiff, v. D-1 Daniel HUNTER, D-2 John Stemple, D-3 Robert Landies, D-4 George Dodson, Defendants.
• Court: U.S. District Court — Eastern District of Michigan

863 F. Supp. 462

UNITED STATES of America, Plaintiff, v. D-1 Daniel HUNTER, D-2 John Stemple, D-3 Robert Landies, D-4 George Dodson, Defendants.

No. 92-CR-80770-DT.

United States District Court, E.D. Michigan, Southern Division.

September 2, 1994.

Diane Donohue, Asst. U.S. Atty., Detroit, MI, for plaintiff.

Richard O'Neil, FDO Detroit, MI, for Hunter.

Robert Sanders, Washington, DC, for Stemple.

James Jeffries, Greensboro, NC, for Landies.

Ed Wishnow, Southfield, MI, for Dodson.

OPINION AND ORDER REGARDING DEFENDANT STEMPLE'S MOTION TO QUASH SEARCH WARRANT, SUPPRESS EVIDENCE AND DISMISS INDICTMENT, MOTION TO SEVER, AND MOTION FOR BILL OF PARTICULARS; DEFENDANT LANDIES' MOTION FOR RECONSIDERATION; AND DEFENDANT DODSON'S MOTION FOR DISCOVERY

ROSEN, District Judge.

I. INTRODUCTION

On January 24, 1994, this Court issued an opinion and order resolving a series of pretrial motions filed by Defendants Hunter, Landies and Dodson and by defendants in a companion case. See United States v. Hunter, 843 F.Supp. 235 (E.D.Mich.1994) (hereinafter Hunter I). Before proceeding to trial, however, this Court must decide a second round of pretrial motions brought with this Court's permission by Defendant Stemple on January 18. They are (1) Stemple's motion to quash a search warrant, suppress evidence, and dismiss indictment; and (2) Stemple's motion for severance.¹

Defendant Landies also moved this Court on February 25 to reconsider its holding in Hunter I that machinegun conversion kits are "firearms" for purposes of Title 18 of the United States Code. See 843 F.Supp. at 256.

II. DISCUSSION

A. SUMMARY OF THE INDICTMENT.

1. Count I: Conspiracy To Violate Federal Firearms Laws In Violation Of 18 U.S.C. § 371.²

Prior to 1986, George Dodson, who was neither a federally licensed firearms manufacturer nor a licensed dealer, arranged for the manufacture and/or acquisition of M-2, M-10, and M-11 .30 caliber machinegun conversion kits.³ Dodson lived and/or worked at all times relevant to the indictment in Dearborn, Michigan.

Before May, 1986, Dodson agreed to transfer the conversion kits to Daniel Hunter, a licensed firearm manufacturer in the Eastern District of Michigan d/b/a the Broadhead Armory, Inc. Hunter, in turn, filed registration forms with the U.S. Department of Treasury's Bureau of Alcohol, Tobacco and Firearms ("ATF") on May 7, 1986, showing that the Broadhead Armory manufactured the conversion kits.⁴

On May 28, 1987, Hunter signed and forwarded twenty ATF Form 3s (Application for Tax-Exempt Transfer of Firearm and Registration to Special (Occupational) Taxpayer) requesting permission to transfer twenty M-1 and M-2 .30 caliber carbine conversion kits with serial numbers BAV 082-BAV 101 to John Stemple, a federally licensed firearms manufacturer in Ohio. On August 31, 1987, Stemple made an entry in his bound book showing receipt of the twenty conversion kits listed above from Hunter, even though he allegedly received the weapons directly from Dodson. On September 2, 1987, Stemple filed and forwarded ATF Form 3s requesting permission to transfer the above twenty conversion kits to Robert Landies, a federally licensed firearms manufacturer in Ohio d/b/a the Collector's Corner. The Form 3s showed the conversion kits as being .50 caliber machineguns. On September 18, 1987, Landies made an entry in his bound book showing receipt of twenty ".50 caliber full autos."

On December 7, 1989, Landies still had in his possession the twenty .30 caliber conversion kits with serial numbers BAV 082-BAV 101. On December 14, 1987, Hunter had in his possession 328 conversion kits manufactured by Dodson but registered as being manufactured by himself. Similarly, on March 8, 1988, Stemple had in his possession some 75 conversion kits manufactured by Dodson but registered as being manufactured by Hunter. On July 10, 1989, Hunter had in his possession 299 conversion kits he received from Dodson but listed as being manufactured by himself. And, on March 21, 1990, Stemple had in his possession 87 conversion kits which he received from Dodson, but which were registered as being manufactured by Hunter.

The indictment alleges that all of these acts violated 18 U.S.C. § 371. In particular, the indictment alleges that the Defendants knowingly conspired to violate 18 U.S.C. §§ 922(a)(1)(A)⁵, 992(o),⁶ 923(g)(1)(A),⁷ 924(a)(2)⁸ and 924(a)(3).⁹

2. Count II: Possession Of Machineguns In Violation Of 18 U.S.C. § 922(o) (Landies).

On or about December 7, 1989, Landies knowingly possessed twenty machinegun conversion kits with serial numbers BAV 082-BAV 101 in violation of § 922(o).

3. Count III: Possession Of Machineguns In Violation Of 18 U.S.C. § 922(o) (Hunter).

On or about December 14, 1987, Hunter knowingly possessed 328 machinegun conversion kits in violation of § 922(o).

4. Count IV: Possession Of Machineguns In Violation Of 18 U.S.C. § 922(o) (Stemple).

On or about March 8, 1988, Stemple knowingly possessed 75 machinegun conversion kits in violation of § 922(o).

5. Count V: Possession Of Machineguns In Violation Of 18 U.S.C. § 922(o) (Hunter).

On or about July 10, 1989, Hunter knowingly possessed 299 machinegun conversion kits in violation of § 922(o).

6. Count VI: Possession Of Machineguns In Violation Of 18 U.S.C. § 922(o) (Stemple).

On or about March 21, 1990, Stemple knowingly possessed 87 machinegun conversion kits in violation of § 922(o).

7. Count VII: False Or Fraudulent Statements In Violation Of 18 U.S.C. § 1001 (Stemple).¹⁰

On September 2, 1987, Stemple knowingly filed false ATF Form 3s to transfer machinegun conversion kits to Landies in violation of 18 U.S.C. § 1001.

8. Count VIII: Engaging In The Business Of Firearms Without A License In Violation Of 18 U.S.C. §§ 922(a)(1)(A) And (a)(2) (Hunter, Stemple, Dodson).¹¹

From on or about September, 1987, through March, 1990, Hunter, Stemple and Dodson willfully engaged in firearms dealing without a license in violation of §§ 922(a)(1)(A) and 922(a)(2).

B. STEMPLE'S MOTION TO QUASH SEARCH WARRANT, SUPPRESS EVIDENCE AND QUASH INDICTMENT.¹²

1. Stemple's Challenges Of Search Warrant And Search Return.¹³

a. The search warrant.

On March 21, 1990, ATF agents searched Stemple's business/home on 6529 Alum Creek Drive in Groveport, Ohio, pursuant to a search warrant issued the day before. The warrant was issued on the grounds that probable cause for a search was shown by ATF Agent Tim Sullivan's affidavit. See Stemple's Brief, Ex. IV (hereinafter "Affidavit").

Stemple argues that this affidavit fails to set forth sufficient probable cause for the warrant to issue. Specifically, Stemple asserts that the affidavit fails to establish a nexus between Defendant Hunter's alleged illegalities and Stemple's activities. Instead, Stemple contends that it sets forth a series of complicated facts which could be easily misconstrued. In addition, Stemple argues that the warrant contains false and misleading statements, in that it did not contain the following pieces of information also known to Agent Sullivan at the time: (1) that Stemple was not under investigation for illegal registration of firearms; (2) that Agent Sullivan did not know for sure if Hunter was transferring actual firearms or, as he suspected, only paper registrations for the same; (3) that Agent Sullivan knew Stemple traded in bulk in firearms; (4) that most of Hunter's machinegun registrations were, in fact, legal; and (5) that a less intrusive form of investigation was available to ATF. Because of the allegedly misleading nature of the Affidavit, Stemple asks either for a suppression of the evidence seized from his business/home, or for a hearing in accord with Franks v. Delaware, 438 U.S. 154, 98 S.Ct. 2674, 57 L.Ed.2d 667 (1978), to determine the sufficiency of the Affidavit.

The Government counters that it is Stemple who is attempting to mislead the Court on the sufficiency of Agent Sullivan's Affidavit. It relies on the search warrant affidavit and Agent Sullivan's grand jury testimony in support of its position.

The Court has reviewed the search warrant affidavit and the portions of the grand jury transcript cited by Stemple, and it finds that the Government is absolutely correct. The search warrant affidavit clearly establishes the following:

1. On June 2 and 6, 1987, an ATF inspector visited Daniel Hunter's Broadhead Armory and recorded the presence of certain machinegun receivers and conversion kits. Affidavit ¶¶ 10, 10A and 11.

2. Hunter transferred to Stemple many of these receivers and conversion kits, and Stemple himself, in turn, transferred these items on to others. See ¶¶ 12-20.

3. These transfers appeared improper because what was transferred was either not what Hunter had originally registered or was something other than what appeared on the transfer records Hunter and Stemple filed. See ¶¶ 16, 21.

4. Hunter, with the probable assistance of Stemple, had engaged in a number of schemes to transfer only the "paper" for firearms, i.e., their valid registrations, and not to additionally transfer the actual firearms. See ¶ 23. This was evidenced by the following:

a. The events involving the defendants in 92-80769, a companion case to the instant action. Id.

b. The fact that with respect to alleged Broadhead Armory gun transferees, including Stemple, Hunter retained firearms even though the transfer records of Hunter, the alleged transferee, and ATF stated that they had been transferred. See ¶¶ 23 & 24.

c. The fact that other "paper only" transfers involving Stemple were possible because what he actually received from Hunter and either kept or transferred elsewhere did not correspond with Hunter's original registrations. See ¶ 23.

From all this, Agent Sullivan stated:

Your affiant, through the investigation set forth in this affidavit, has probable cause to believe that ... John Stemple ... received or possessed illegally manufactured firearms and/or received or possessed firearms not

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