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United States v. Carpenter

United States District Court, D. Massachusetts

February 20, 2019

UNITED STATES OF AMERICA
v.
DANIEL E. CARPENTER, Defendant.

          OPINION AND ORDER

          GEORGE A. O'TOOLE, JR. UNITED STATES DISTRICT JUDGE

         The defendant was convicted by a jury of nineteen counts of mail and wire fraud. His convictions were affirmed on direct appeal. The defendant now brings numerous motions challenging this Court's forfeiture and sentencing decisions, as well as a motion to vacate his conviction and sentence under 28 U.S.C. § 2255 and a motion for a new trial pursuant to Federal Rule of Criminal Procedure 33. I address each motion in turn.

         I. Motion for Reconsideration of Forfeiture Order (dkt. no. 477)

         The defendant moves to reconsider the order of forfeiture. At the sentencing hearing, I requested additional briefing from the parties regarding their forfeiture arguments. (See Sentencing Tr. 30-33 (dkt. no. 446).) After considering those additional papers and arguments, I ordered forfeiture in the amount of $14, 053, 715.52.

         The Court of Appeals has held:

Motions for reconsideration are not to be used as a vehicle for a party to undo its own procedural failures or allow a party to advance arguments that could and should have been presented to the district court prior to judgment. Instead, motions for reconsideration are appropriate only in a limited No. of circumstances: if the moving party presents newly discovered evidence, if there has been an intervening change in the law, or if the movant can demonstrate that the original decision was based on a manifest error of law or was clearly unjust.

United States v. Allen, 573 F.3d 42, 53 (1st Cir. 2009) (citations and internal quotation marks omitted). The defendant fulfills none of those requirements here.

         His primary argument is that his forfeiture amount should be reduced by the amount of money he and his company, BPETCO, “voluntarily” paid out to all Exchangors in 2000 and 2001, which, he argues, should be accounted for as statutory “direct costs.” See 18 U.S.C. § 981(a)(2)(B). This argument fails for several reasons.

         First, this argument was not raised prior to the Court's forfeiture decision, despite extensive briefing. (See, e.g., Daniel E. Carpenter's Mem. in Reply to Gov't Sentencing Mem. 1-2 (dkt. no. 434); Def. Daniel E. Carpenter's Resp. in Opp'n to U.S.' Suppl. Br. in Supp. of Entry of Money J. in the Amount of $14, 053, 715.52 (dkt. no. 455); Assented-To Mot. For Leave to File Sur-Reply (dkt. no. 470) (sur-reply attached to motion).) Instead, the defendant's argument then focused on whether this Court had the power to order forfeiture and how the amount to be forfeited should be calculated. He had ample opportunity to develop a theory that payments to Exchangors were a direct cost within the statutory meaning. The defendant's contention that arguments on direct costs were “premature” or “not in dispute” at the time is not persuasive. The burden of proof of direct costs lies with the defendant. See 18 U.S.C. § 981(a)(2)(B). After discussion on forfeiture at the sentencing hearing, I requested additional briefing specifically to address forfeiture issues. That was the time to present all arguments regarding the issue.[1]

         Second, the defendant makes no attempt to link the payments paid to the Exchangors with the specific counts for which forfeiture was ordered.

         Third, the statutory term “direct costs” clearly refers to the costs of doing business in the ordinary course of transactions that would have been legal but for the fraud.

         To the extent that the defendant makes other arguments about forfeiture elsewhere in his filings, including in his Section 2255 petition, (see Mot. to Vacate Conviction & Reduce Sentence 41-44 (dkt. no. 497)), those arguments merely reexamine issues already decided in the original forfeiture order.

         II. Motion under 28 U.S.C. § 2255 to Vacate, Set Aside, or Correct Sentence (dkt. no. 496)

         In his motion for post-conviction relief under 28 U.S.C. § 2255, the defendant makes a variety of arguments why his conviction and sentence should be vacated. Relief under § 2255 “is an extraordinary remedy, available only on a sufficient showing of fundamental unfairness.” Singleton v. United States, 26 F.3d 233, 236 (1st Cir. 1994).

         Given the lengthy history of this litigation, it should be unsurprising that many, if not all, of the issues raised by the defendant now have already been addressed by this Court or by the First Circuit. Generally speaking, “issues disposed of in a prior appeal will not be reviewed again by way of a 28 U.S.C. § 2255 motion.” Singleton, 26 F.3d at 240 (quoting Dirring v. United States, 370 F.2d 862, 864 (1st Cir. 1967)). Absent some working of significant injustice, relitigating points already decided is wasteful and undercuts confidence in the judicial process. See Ellis v. United States, 313 F.3d 636, 646-47 (1st Cir. 2002); see also United States v. Matthews, 643 F.3d 9, 12- 13 (1st Cir. 2011) (discussing the doctrine of law of the case).

         A. Venue

         The defendant raises a No. of arguments regarding venue. Whether venue was proper has been extensively litigated in this case and is addressed in previous decisions by this Court. See, e.g., United States v. Carpenter (Carpenter I), 405 F.Supp.2d 85, 88-92 (D. Mass. 2005). The defendant has put forward no new reason to reexamine this issue.

         B. Ineffective Assistance of Counsel

         Strickland v. Washington, 466 U.S. 668 (1984), requires that a defendant make two showings in order to prove that his counsel was constitutionally ineffective: (1) “that counsel's performance was deficient, ” and (2) “that the deficient performance prejudiced the defense.” Id. at 687.

         Concerning deficient performance, “there is a ‘strong presumption' that counsel's strategy and tactics fall ‘within the range of reasonable professional assistance,' and courts should avoid second-guessing counsel's performance with the use of hindsight.” Knight v. Spencer, 447 F.3d 6, 15 (1st Cir. 2006) (quoting Strickland, 466 U.S. at 689). “Judicial scrutiny of the defense counsel's performance is ‘highly deferential,' and the defendant must overcome a ‘strong presumption . . . that, under the circumstances, the challenged action “might be considered sound trial strategy.”'” Bucci v. United States, 662 F.3d 18, 30 (1st Cir. 2011) (alteration in original) (quoting Strickland, 466 U.S. at 689). Concerning prejudice, the defendant must show that there is a reasonable probability that the outcome of the prior proceedings would have been different but for counsel's deficiencies. Strickland, 466 U.S. at 694.

         The defendant raises a host of alleged errors committed by his privately retained counsel. The defendant is relatively brief in describing the “litany of errors, ”[2] (Mot. to Vacate Conviction & Reduce Sentence 20), and I shall be as well.

         First, the defendant complains that his counsel “[f]ail[ed] to discover, investigate, or even get a copy of the February 2008 Iantosca lawsuit.” (Id.) The defendant in no way explains what specifically about that lawsuit would have helped his case, or how the opinion he attached, decided in November 2008, could have helped him during his trial in June of that year. See Iantosca v. Merrill Lynch Pierce Fenner & Smith, Inc., Opinion No. 106524, Docket No. 08-0775-BLS2, 2008 Mass. Super. LEXIS 479 (Mass. Super. Ct. Nov. 25, 2008). That case was dismissed at the motion to dismiss stage, and thus it is unclear what, if anything, the fruits of additional investigation into that case might have been.

         Second, the defendant cites the lack of objection to the prosecutor's statement of “that's fraud” during his closing argument. The First Circuit concluded that “[t]aken in context, it is clear that the prosecution's comments were permissible comments on the evidence in the case rather than the prosecutor's own opinion.” United States v. Carpenter (Carpenter IV), 736 F.3d 619, 632 (1st Cir. 2013). While the Circuit's analysis was under plain error review, it is equally clear that under the Strickland standard, this comment is not so extreme that counsel's failure to object fell below an objective standard of reasonableness.

         Third, the defendant argues that his counsel failed to move for a new trial based on newly discovered evidence concerning Merrill Lynch. He claims that his counsel failed to so move because they were representing Merrill Lynch and had conflicting interests. The defendant's argument is factually inaccurate. Defense counsel did argue for a new trial on that basis. (See Def.'s Reply in Supp. of His Suppl. Mem. Concerning New Evid. (dkt. no. 359).) I rejected that particular argument but did grant a new trial for a different reason. See United States v. Carpenter (Carpenter III), 808 F.Supp.2d 366, 386 (D. Mass. 2011). The Court of Appeals reversed that order. Carpenter IV, 736 F.3d at 632.

         Fourth, the defendant complains that counsel was deficient in failing to press for a particular jury instruction based on a case decided long after his trial. See United States v. Gray, 780 F.3d 458 (1st Cir. 2015). Not only is it impossible for counsel to be ineffective for failure to predict an appellate decision seven years in the future, but the jury instructions in this case were affirmed on direct review. See U ...


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