US v. Rosenthal

• Decision Date: 26 April 2006
• Docket Number: 03-10370.,No. 03-10307,03-10307
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Edward ROSENTHAL, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

445 F.3d 1239

UNITED STATES of America, Plaintiff-Appellee, v. Edward ROSENTHAL, Defendant-Appellant.

Nos. 03-10307, 03-10370.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted September 13, 2005.

Filed April 26, 2006.

Dennis P. Riordan, Donald M. Horgan, and Joseph D. Elford, San Francisco, CA, for the appellant.

Amber S. Rosen, George L. Bevan, Jr., Hannah Horsley, and Kevin V. Ryan, U.S. Attorney's Office, San Jose, CA, for the appellee.

Before B. FLETCHER, JOHN R. GIBSON,^* and BERZON, Circuit Judges.

BETTY B. FLETCHER, Circuit Judge.

Edward Rosenthal appeals a three-count conviction for violations of the Controlled Substances Act ("CSA"), 21 U.S.C. §§ 801 et seq., asserting an as-applied Commerce Clause challenge, a claim of immunity pursuant to 21 U.S.C. § 885(d), erroneous evidentiary rulings and instructions by the district court, prosecutorial misconduct, juror misconduct, and the improper denial of a hearing under Franks v. Delaware, 438 U.S. 154, 98 S.Ct. 2674, 57 L.Ed.2d 667 (1978). The government cross-appeals, claiming that the district court erroneously found Rosenthal eligible for the "safety valve" and erroneously departed downward to impose a single day of confinement.

We have jurisdiction pursuant to 28 U.S.C. § 1291 and 18 U.S.C. § 3742(b), and we reverse the conviction solely on the issue of jury misconduct. We affirm the district court on all other grounds and dismiss the government's claims regarding sentencing as moot.

I

In November 1996, Californians passed, by voter initiative, Proposition 215, the Compassionate Use Act, which allows patients to obtain marijuana for "personal medical purposes . . . upon the written or oral recommendation or approval of a physician." CAL. HEALTH & SAFETY CODE § 11362.5(d). One of the purposes of the Compassionate Use Act is

to ensure that seriously ill Californians have the right to obtain and use marijuana for medical purposes where that medical use is deemed appropriate and has been recommended by a physician who has determined that the person's health would benefit from the use of marijuana in the treatment of cancer, anorexia, AIDS, chronic pain, spasticity, glaucoma, arthritis, migraine, or any other illness for which marijuana provides relief.

Id. The statute shields patients and their primary caregivers from prosecution under state-law provisions outlawing the possession and cultivation of marijuana. See id. § 11362.5(d).

A

After passage of the Compassionate Use Act, a number of "medical cannabis dispensaries" were formed to make marijuana accessible to seriously ill patients. In support of those efforts, the Oakland City Council, on July 28, 1998, adopted Ordinance No. 12076 ("the Oakland Ordinance"), which intends to "ensure access to safe and affordable medical cannabis pursuant to the Compassionate Use Act of 1996." Oakland, Cal., Ordinance 12076 § 1(C) (July 28, 1998) (codified as amended at OAKLAND, CAL., MUN. CODE ch. 8.46). The Oakland Ordinance purports to "provide immunity to medical cannabis provider associations pursuant to Section 885(d) of Title 21 of the United States Code." Id. § 1(D). Under the Ordinance, the City Manager designates "one or more entities as a medical cannabis provider association."¹ That entity would then designate individuals to help distribute medical cannabis to seriously ill persons.

The City of Oakland designated the Oakland Cannabis Buyers' Cooperative ("OCBC") an official medical-cannabis-provider association. Jeffrey Jones, OCBC's executive director, designated Rosenthal to be an agent of the OCBC and to cultivate marijuana plants for distribution to authorized medical-cannabis users. That designation, memorialized in a letter from Jones to Rosenthal on September 4, 1998, specifically states that "you are deemed a duly authorized `officer of the City of Oakland' and as such are immune from civil and criminal liability under Section 885(d) of the federal Controlled Substances Act."

B

After California's approval of the Compassionate Use Act, questions surfaced as to whether cannabis dispensaries actually were immune from prosecution under state and federal drug laws. In 1997, a California Court of Appeal held that cannabis-cultivating clubs are not "primary caregivers" within the meaning of the Compassionate Use Act and are therefore not shielded from prosecution under the state's controlled-substances laws. See People ex rel. Lungren v. Peron, 59 Cal. App.4th 1383, 70 Cal.Rptr.2d 20, 31-32 (1997).² On May 19, 1998, the same district court from which the instant appeal is taken entered a preliminary injunction order barring the OCBC (and five other cannabis dispensaries) from manufacturing, distributing, or possessing marijuana with the intent to manufacture or distribute, in violation of federal law. See United States v. Cannabis Cultivators Club, 5 F.Supp.2d 1086, 1106(N.D.Cal.1998).

The OCBC, after designation as an official cannabis dispensary, sought dismissal of the complaint, but the district court denied that request, rejecting the OCBC's claim that the Oakland Ordinance immunized it from federal liability under 21 U.S.C. § 885(d). The district court further denied OCBC's requests to modify the injunction to permit an exception in cases of medical necessity.³

Rosenthal continued cultivating marijuana for distribution to both the OCBC and San Francisco's Harm Reduction Center from October 2001 until February 12, 2002, the day of his arrest.

C

Rosenthal filed a series of pre-trial motions and, eventually, a motion to dismiss the indictment. He claimed his prosecution exceeded the federal government's powers under the Commerce Clause, violating the Tenth Amendment to the U.S. Constitution; that the government engaged in selective prosecution; that he was immune from prosecution under the federal immunity provision; and that the indictment was tainted due to entrapment-by-estoppel. The district court denied all of Rosenthal's motions. It also granted the government's motions in limine, which precluded Rosenthal from putting on a "medical marijuana" defense, introducing evidence or argument aimed at jury nullification, or introducing evidence or argument related to an entrapment-by-estoppel defense.

D

On January 31, 2003, at the conclusion of the trial, the jury found Rosenthal guilty of one count of manufacturing marijuana, in violation of 21 U.S.C. § 841(a)(1); one count of conspiracy to manufacture marijuana, in violation of 21 U.S.C. § 846; and one count of maintaining a place for the manufacture of marijuana, in violation of 21 U.S.C. § 856(a)(1).

Rosenthal moved for a new trial pursuant to Federal Rule of Criminal Procedure 33, arguing that the court erred by excluding his defense of entrapment by estoppel; the court improperly excluded 19 jurors who expressed pro-medical-marijuana beliefs; the court erroneously instructed the jury regarding its right to engage in nullification; and Rosenthal was entitled to a new trial because of juror and prosecutorial misconduct. As to juror misconduct, Rosenthal submitted declarations from two jurors, one of whom, on the eve of the verdict, consulted with an attorney-friend who admonished the juror to follow the judge's instructions or risk "getting into trouble." The district court held an evidentiary hearing on April 1 and 8, 2003, and denied the motion for a new trial in a published order. See United States v. Rosenthal, 266 F.Supp.2d 1068 (N.D.Cal. 2003) ("Rosenthal I").

On June 4, 2003, the district court sentenced Rosenthal to one day of imprisonment. See United States v. Rosenthal, 266 F.Supp.2d 1091 (N.D.Cal.2003) ("Rosenthal II"). The court found Rosenthal eligible for safety-valve relief pursuant to United States Sentencing Guidelines § 5C1.2, entitling him to a sentence below the mandatory five-year minimum. See id. at 1097. The court departed downward by ten levels based on the determination that Rosenthal honestly and reasonably believed he was not disobeying federal law given the promises made by Oakland officials. See id. at 1098-100. Rosenthal was sentenced to three concurrent sentences of one day, with credit for time served.

II

Rosenthal raises a claim of immunity pursuant to 21 U.S.C. § 885(d), challenges to the district court's evidentiary rulings and instructions regarding argument, claims of prosecutor and juror misconduct, and the denial of a Franks hearing.⁴ The government cross-appeals, arguing that the district court erred in finding that Rosenthal was eligible for the "safety valve" and in departing from the minimum sentence to impose a single day of confinement.

III

The district court issued a thorough and well-reasoned order articulating its basis for denying one of the evidentiary objections, the prosecutorial-misconduct claim, and the jury-instructions claim, see Rosenthal I, 266 F.Supp.2d at 1079-82, 1085 n. 5, and ruled on the other evidentiary issue and the Franks hearing issue orally. We agree with the district court's written and oral analysis of those issues and adopt its reasoning in whole. However, we reverse the district court on the jury-misconduct claim.

We independently review the question regarding immunity under 21 U.S.C. § 885(d) to underscore our holding that the provision does not apply to individuals, such as Rosenthal, who are involved with medical-cannabis dispensaries.

Finally, we dismiss as moot the government's cross-appeal challenging the length of the sentence.

IV

Rosenthal claims that he is immune from prosecution under 21 U.S.C. § 885(d). We review de novo a district court's decision to dismiss an indictment based on an interpretation of a federal statute. United States v. Marks, 379 F.3d 1114, 1116 (9th Cir.2004), cert. denied, 543 U.S. 1170, 125 S.Ct. 1355, 161 L.Ed.2d 148 (2005).

21 U.S.C. § 885(d) states, in full:

Except as provided in sections 2234 and 2235 of Title 18relating to illegal procurement and execution of search warrants, no civil

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