Opinion
98 CR 0696 (SJ), 01 CV 7826 (SJ).
August 14, 2006
ROSLYNN R. MAUSKOPF, ESQ., United States Attorney, Eastern District of New York, Brooklyn, NY, By: Mary M. Dickman, Esq., Attorney for the United States.
HERMAN E. FREDERICK, Brooklyn, NY, Defendant Pro Se.
MEMORANDUM AND ORDER
Presently before the Court is a motion from Defendant Herman Frederick ("Defendant") to vacate, set aside or modify an order of restitution and/or supervised release (the "Post-Conviction Motion"). Defendant also moves this court to appoint counsel to represent him in proceedings related to the Post-Conviction Motion. For the reasons stated herein, the Post-Conviction Motion is hereby TRANSFERRED to the United States Court of Appeals for the Second Circuit (the "Second Circuit") for review as a second or successive habeas petition. The related motion for appointment of counsel is hereby DENIED.
BACKGROUND
Familiarity with the underlying facts and procedural history of this case are presumed and, therefore, only the facts relevant to the disposition of the instant motion will be recounted here.
Defendant was convicted on December 13, 1999, after a jury trial, of conspiracy to aid in defrauding the United States, in violation of 18 U.S.C. § 371. The conspiracy for which Defendant was convicted involved the systematic preparation of false income tax returns for clients of his business, Century 21 Financial Services. In the charged scheme, which occurred from January 1993 to July 1994, Defendant advised his clients to reduce their tax liabilities by filing tax forms that fraudulently claimed personal expenses as business expenses.
At sentencing, the United States of America (the "Government") advised the Court that taxpayers had wrongfully deducted a total of $1,396,794 in business expenses on income tax returns prepared by Defendant's business during the course of the conspiracy. (See Declaration of Mary Dickman ("Dickman Decl."), Ex. C. ("Sentencing Tr.") at 3-5.) The Government also determined that Defendant's filing of false deductions resulted in an actual tax loss to the IRS in an amount equal to $391,102, that is, 28 percent of the total of the improperly claimed deductions ($1,396,794). (Sentencing Tr. 3-4, 8-9; Dickman Decl., Ex. D.).
Defendant originally objected to a greater loss figure originally set forth in the Pre-Sentence Report prepared by the United States Probation Department ("Probation"). (See Dickman Decl., Ex. D.) After engaging in discussions with Defendant's counsel, the Government provided the Court with two alternative calculations of the tax deductions that were wrongfully claimed as part of the charged conspiracy: (1) $2,281,168, which included all tax returns received by the Government from a cooperating witness, who took copies of returns prepared in the course of the conspiracy when the witness left Defendant's company and (2) $1,396,794, which included only those tax returns to which Defendant raised no objection. (See Dickman Decl., Ex. D.) The Court used the lesser of the two amounts in determining the actual tax loss to the Government and in sentencing Defendant (see U.S. Sentencing Guidelines § 2T4.1 (2000) (setting forth certain base offense levels for various amounts of tax loss).
On May 1, 2000, the Court sentenced Defendant in accordance with the Victim and Witness Protection Act of 1982 (the "VWPA"), codified at 18 U.S.C. § 3663, to a term of imprisonment of 60 months, to be followed by a three-year term of supervised release. The sentence also required Defendant to pay a special assessment of $100.00 and restitution, based on the amount of the tax loss to the Government, in the amount of $391,102. The Court also ordered that Defendant, as a condition of supervised release, make payments toward his restitution obligation at the rate of $100.00 per month, with payments to begin upon his release from prison. (Sentencing Tr. 8-9.) Defendant did not object to the restitution order at sentencing.
The VWPA provides, in relevant part, that a court sentencing a defendant convicted of an offense under title 18 of the United States Code "may order . . . that the defendant make restitution to any victim of such offense. . . ." 18 U.S.C. § 3663(a). The VWPA is a predecessor statute for the Mandatory Victims Restitution Act of 1996 (the "MVRA"), codified at 18 U.S.C. § 3663A, which supplemented and amended the VWPA. The MVRA provides for mandatory restitution to the victims of certain identified offenses, including, as here, offenses against property. See 18 U.S.C. §§ 3663A(a)(1), (c)(1)(A)(ii).
Defendant appealed his conviction to the Second Circuit on numerous grounds, including that the Court sentenced him based on an "unproven tax loss." United States v. Frederick, 242 F.3d 368, 2001 WL 10364, at *1 (2d Cir. Dec. 28, 2000) (unpublished op.). On December 28, 2000, the Second Circuit affirmed Defendant's conviction and dismissed Defendant's appeal. Id. On September 27, 2002, Defendant filed a petition for rehearing with the Second Circuit, seeking en banc review of his appeal; this request was denied on January 23, 2003. (Dickman Decl., Ex. E. at 1.)
On November 26, 2001, Defendant filed a motion to vacate, set aside, or correct the conviction and sentence imposed in his criminal case, pursuant to 28 U.S.C. § 2255 (the "§ 2255 Motion"). Herman Frederick v. United States, No. 01 CV 7826, 2005 U.S. Dist. LEXIS 31580, at *1 (E.D.N.Y. Sept. 8, 2005). Although Defendant's § 2255 Motion set forth twenty-four (24) separate grounds of relief, none of these grounds alleged that this Court erred in determining the restitution amount for which Defendant would be responsible. On August 23, 2005, in a lengthy Memorandum and Order, this Court denied Defendant's § 2255 Motion. Id.
Defendant alleged the following grounds for relief in the § 2255 Motion: (1) ineffective assistance of counsel with regard to all three of Defendant's attorneys; (2) the Court's lack of subject matter jurisdiction over Defendant's criminal case; (3) defects in the indictment; (4) judicial amendment to the indictment; (5) this Court's foreknowledge of facts; (6) improper denial of Defendant's pre-trial discovery motion; (7) violation of Defendant's right to counsel of choice with respect to court-appointed counsel; (8) failure of this Court to advise Defendant of the right to counsel; (9) violation of Defendant's right to adequately prepare for trial; (10) violation of the Sixth Amendment right to call, confront and cross-examine witnesses; (11) violation of Defendant's right to preparation time with regard to Defendant's November 22, 1999 continuance request; (12) conflict of interest with retained counsel; (13) Speedy Trial Act violation; (14) impermissible ex parte communication between the Government and the Court during Defendant's trial; (15) defective jury instructions; (16) Brady violations; (17) variance in proof regarding multiple other conspiracies; (18) defective jury instructions; (19) insufficient evidence to support the guilty verdict; (20) conviction of a crime not properly charged; (21) trial counsel's failure to introduce a "good faith" defense at trial; (22) violation of Defendant's Sixth Amendment right to testify; (23) the Court's improper granting on October 8, 1999 of a continuance allegedly requested by the prosecution; and (24) improper sentencing enhancements based on Probation's incorrect designation of Defendant as leader or organizer of the charged conspiracy.
Defendant was released from prison on December 24, 2004. As of March 20, 2006, Defendant had paid only $500.00 toward his restitution obligation. Including the payments made during his incarceration, the Government alleges that Defendant has paid a total of $755.10 toward the restitution judgment of $391,102.00. (Gov't Mem. Law Opp'n Post-Conviction Mot. 4.)
On January 31, 2006, Defendant filed the Post-Conviction Motion, requesting, without providing a statutory basis for such a request, that the order of restitution be vacated, set aside, or modified. Defendant specifically argues that the restitution judgment should be vacated because the tax loss attributed to him by the Court, and used to calculate restitution, was not a statutory or charged element of the offense for which he was convicted, and that the Court ordered him to pay restitution for tax losses based upon offenses for which he was not charged. He also contends that, by basing the amount of restitution upon the amount of wrongfully claimed deductions, the Court "almost certainly" sentenced him to pay restitution for potential, rather than actual, losses. Defendant further requests that the Court stay the enforcement of the restitution judgment during the pendency of the Post-Conviction Motion.
On or about January 8, 2006, Defendant filed a motion seeking a modification of the restitution payment schedule (the "January 8 Motion"). Specifically, Defendant requested a reduction from the $100.00 per month payment schedule imposed by the Court to $25.00 per month. See Docket No. 98 CR 696, Entry No. 134. In response to the January 8 Motion, the Court requested, via Probation, that Defendant produce information with respect to his financial condition no later than February 1, 2006, to facilitate Probation's determination of whether a change in the payment schedule was required. See 18 U.S.C. § 3664(k) (permitting adjustment of restitution payment schedule based upon material change in defendant's economic circumstances). Defendant did not provide the requested financial information by the February 1 deadline. Rather, Defendant informed the Government that he wished to withdraw the January 8 Motion and instead have the Court consider the instant motion. In accordance with Defendant's request, the January 8 Motion is hereby DISMISSED.
DISCUSSION
In addressing the Post-Conviction Motion, the Court is mindful that Defendant is proceeding pro se, and his submissions will therefore be liberally construed and read to raise the strongest arguments they suggest. See, e.g., Abrahamson v. United States, No. 03 CV 4677, 2004 U.S. Dist. LEXIS 7150, at *2-3 (S.D.N.Y. Apr. 26, 2004).
I. The Post-Conviction Motion
Before examining its merits, the Court must determine whether it has jurisdiction to consider Defendant's Post-Conviction Motion, as Defendant does not cite any statutory basis for the relief requested therein. The Court will thus identify and discuss potential bases for jurisdiction in turn.
A. Motion to Correct or Reduce a Sentence
Rule 35(a) of the Federal Rules of Criminal Procedure provides, as it did at the time of Defendant's sentencing, that a sentence may be corrected within seven days after sentencing for arithmetical, technical, or other clear error. Fed.R.Crim.P. 35(a). Only defendants that adduce proof that their sentences are affected by error may apply for a Rule 35(a) correction. Id.
Here, the time permitted for a Rule 35(a) motion has long since passed. Defendant was sentenced on May 1, 2000; thus, the seven-day limitation period would have expired on May 10, 2000. Rule 35(a) relief is therefore unavailable to Defendant at this juncture. B. Appellate Review of a Sentence, pursuant to 18 U.S.C. § 3742
This date was calculated in accordance with Rule 45 of the Federal Rules of Criminal Procedure, which requires that a computation of any period of time specified in the federal criminal rules should "[e]xclude intermediate Saturdays, Sundays and legal holidays when the period is less than 11 days." Fed.R.Crim.P. 45.
To the extent that Defendant contends that he is entitled to another appeal, this argument is meritless, as the limitations period for filing a notice of appeal has long since passed. A defendant may file a notice of appeal in a district court for review of an otherwise final sentence in certain instances, including when a sentence is imposed in violation of law or imposed as a result of an incorrect application of the sentencing guidelines. See 18 U.S.C. § 3742(a). However, this notice of appeal must be filed with the district court within 10 days of the date of entry of judgment. Fed.R.App.P. 4(b)(1)(A).
A restitution order is a final criminal judgment, notwithstanding the fact that it can be corrected, modified, appealed, amended, or adjusted. See 18 U.S.C. § 3664(o). The final order of restitution for Defendant was entered on May 8, 2000. See Docket No. 98 CR 696, Entry 91.
Given that the 10-day appeals period applicable to Defendant's criminal case has expired, the Court cannot vacate, set aside, or modify the Court's restitution judgment on this basis.
C. Change in Economic Circumstances That Affects Restitution Payment
Rather than requiring payment in full at sentencing, a court may, in the interest of justice, allow a defendant to make restitution payments on a certain date or in installments. 18 U.S.C. § 3572(d)(3). If, however, a change in economic circumstances occurs that might affect their ability to pay restitution, defendants may notify the sentencing court. 18 U.S.C. § 3664(k). After the victims to whom restitution is owed are notified of these changed circumstances, the court may adjust the payment schedule, or require immediate payment in full, as the interests of justice require. Id.
Such as the statutes and rules previously discussed herein, neither 18 U.S.C. § 3664(k) nor 18 U.S.C. § 3572(d)(3) can provide Defendant with the relief requested in the Post-Conviction Motion. These provisions only provide the Court with authority to adjust Defendant's restitution payment schedule upon a demonstration of circumstances warranting such a remedy, not with broad discretion to vacate, set aside, or modify the underlying restitution judgment. The Post-Conviction Motion invites the Court to engage in the latter, a course of action which is proscribed in the context of this case, without providing any evidence that will allow the Court to do the former. Therefore, neither of the cited statutes confers jurisdiction over Defendant's Post-Conviction Motion.
D. Modification of the Terms of Supervised Release, pursuant to 18 U.S.C. § 3583(e)(2)
Section 3583(e)(2) of Title 18 of the United States Code permits a sentencing court to "modify, reduce, or enlarge the conditions of supervised release, at any time prior to the expiration or termination of the term of supervised release." This statute is, like the others discussed before it by the Court, unavailing to Defendant.
Although 18 U.S.C. § 3583(e)(2) does in fact authorize the court to modify supervised release conditions, it is settled in the Second Circuit that the illegality of supervised release conditions, such as a schedule for restitution payments is not a proper ground to modify the terms of supervised release. United States v. Lussier, 104 F.3d 32, 34 (2d Cir. 1997). Therefore, the Court cannot review Defendant's Post-Conviction Motion on this basis.
Notably, in Lussier, as here, the defendant first unsuccessfully argued before the Second Circuit that the sentencing district court improperly calculated the loss attributable to him under the Sentencing Guidelines. Lussier, 104 F.3d at 33. After that failed appeal, the Lussier defendant argued before the sentencing court, for the first time in post-conviction motions pursuant to 18 U.S.C. §§ 3582(e)(2) and 3663(g), that the restitution order imposed against him was illegal because it improperly included losses that were not the basis for any of his counts of conviction. Id. The district court concluded that it lacked authority under 18 U.S.C. § 3582(e) to modify or rescind the restitution order on the ground of illegality, a decision that was affirmed by the Second Circuit.Id. at 37.
E. Motion to Vacate, Set Aside, or Correct a Sentence, pursuant to 28 U.S.C. § 2255
Given the unavailability of any other cognizable bases for this Court to consider the Post-Conviction Motion, the Court finds that the only remaining means by which Defendant may seek relief is for this Court to construe the instant motion as one to vacate, set aside, or correct his sentence, pursuant to 28 U.S.C. § 2255. This section provides, in pertinent part:
A prisoner in custody under sentence of a court established by Act of Congress claiming the right to be released upon the ground that the sentence was imposed in violation of the Constitution or laws of the United States, or that the court was without jurisdiction to impose such sentence, or that the sentence was in excess of the maximum authorized by law, or is otherwise subject to collateral attack, may move the court which imposed the sentence to vacate, set aside or correct the sentence.28 U.S.C. § 2255. A petitioner may not, however, employ a § 2255 petition to re-litigate claims already raised and considered on direct appeal. See United States v. Sanin, 252 F.3d 79, 83 (2d Cir. 2001). In addition, a petitioner generally may not assert a claim in a § 2255 petition that he or she failed to raise on direct appeal unless the petitioner shows cause for the omission and prejudice resulting therefrom, or actual innocence. See Bousley v. United States, 523 U.S. 614, 622-3 (1998).
Procedural default is not the only hurdle faced by § 2255 petitioners. Section 105 of the Antiterrorism and Effective Death Penalty Act of 1996 ("AEDPA"), Pub.L. No. 104-132, 110 Stat. 1214, went into effect on April 24, 1996, and imposed a requirement that relief under § 2255 is now generally subject to a one-year statute of limitations. Federal habeas petitions must be filed within a one-year period, which begins to run, with certain exceptions, either after the petitioner has exhausted direct appeals or after the time for seeking appellate review has expired. This limitations period may, however, be equitably tolled in rare and exceptional circumstances. Smith v. McGinnis, 208 F.3d 13, 17 (2d Cir. 2000) (internal quotation marks and citation omitted).
Specifically, § 2255 states:
A 1-year period of limitation shall apply to a motion under this section. The limitation period shall run from the latest of —
(1) the date on which the judgment of conviction becomes final;
(2) the date on which the impediment to making a motion created by governmental action in violation of the Constitution or laws of the United States is removed, if the movant was prevented from making a motion by such governmental action;
(3) the date on which the right asserted was initially recognized by the Supreme Court, if that right has been newly recognized by the Supreme Court and made retroactively applicable to cases on collateral review; or
(4) the date on which the facts supporting the claim or claims presented could have been discovered through the exercise of due diligence.28 U.S.C. § 2255.
In this case, the Court may not entertain Defendant's Post-Conviction Motion as one made pursuant to § 2255 because it is a second habeas petition that must be certified for review by the Second Circuit. AEDPA proscribes a district court's consideration of a second or successive habeas petition unless the party seeking habeas relief "move[s] in the appropriate court of appeals for an order authorizing the district court" to do so. 28 U.S.C. § 2244(b)(3)(A).
The Court notes that, although the text of 28 U.S.C. § 2244 only makes reference to habeas petitions brought under 28 U.S.C. § 2254, the federal habeas statute makes no material distinction between petitions under § 2254 and § 2255 in defining a "second or successive" petition. Murray v. Greiner, 394 F.3d 78, 81 (2d Cir. 2005) (citation omitted). Indeed, § 2255 incorporates the gatekeeping procedures for second or successive § 2254 petitions set forth in § 2244. Id., 28 U.S.C. § 2255 ("A second or successive motion must be certified as provided in section 2244. . . .").
Upon review of such applications, the court of appeals will only authorize the filing of a second or successive application if it determines that the application makes a prima facie showing that the application contains (1) a newly discovered factual predicate that, if proven and viewed in light of the evidence as a whole, would be sufficient to establish by clear and convincing evidence that, but for constitutional error, no reasonable factfinder would have found the movant guilty of the offense; or (2) a new rule of constitutional law, made retroactive to cases on collateral review by the Supreme Court, that was previously unavailable. 28 U.S.C. §§ 2244(b)(3)(C), 2244(b)(2).
The Court finds that Defendant's Post-Conviction Motion offers nothing more than new attacks on his criminal conviction and sentence and, thus, constitutes a second or successive habeas petition. During his direct appeal, Defendant challenged the method by which the Court computed the tax loss figure ultimately used to determine his base offense level under the Sentencing Guidelines. United States v. Frederick, 2001 WL 10364, at *4. Defendant specifically argued that the government did not provide proof that all of the allegedly fraudulent tax returns were in fact filed, were false, or that he had any connection with said returns. Id. However, conspicuously absent from Defendant's direct appeal is any dispute regarding the legality of the Court's imposition of a restitution order pursuant to the VWPA, an order based on the same set of calculations used to determine Defendant's guidelines sentence.
As previously noted, the restitution amount in this case is the same as the tax loss used for sentencing purposes, that is, $391,102. Sentencing Tr. 8:19-22, 9:1-5; Dickman Decl., Ex. A at 4.
In addition to failing to challenge the restitution order on appeal, Defendant did not raise such arguments in his § 2255 Motion. As previously noted, Defendant challenged his conviction and sentence on 24 different grounds in the § 2255 Motion filed on November 26, 2001, and the Court denied that motion on August 23, 2005. Frederick v. United States, 2005 U.S. Dist. LEXIS 31580, at *1. However, none of the 24 grounds for relief set forth by Defendant challenged the legality of the restitution order now at issue.
Given that the restitution-based arguments are making their first appearance in the instant motion, and the dearth of other statutory bases upon which to consider the arguments set forth therein, the Court deems the Post-Conviction Motion to be a second habeas petition. Accordingly, this Court must transfer this motion to the Second Circuit in order that it authorize this Court's review of Defendant's latest collateral attack. See 28 U.S.C. § 2244(b)(3)(A); Poindexter v. Nash, 333 F.3d 372, 382 (2d Cir. 2003) ("Where the [district] court determines that an application raises only claims which are properly brought under § 2255, that the applicant has filed a prior § 2255 motion which was dealt with on the merits, and that no authorization from the court of appeals has been obtained as mandated by § 2244(b)(3), the district court must transfer the motion to [the Second Circuit].") (emphasis added) (internal quotation marks and citations omitted).
II. Motion for Appointment of Counsel
Defendant also requests that this Court appoint counsel to represent him in Post-Conviction Motion proceedings. Section 1915(e) of Title 28 of the United States Code states that "[t]he court may request an attorney to represent any person unable to afford counsel." The Second Circuit in Cooper v. A. Sargenti Co., Inc., 877 F.2d 170 (2d Cir, 1989) has offered guidance for appointment of pro bono counsel in civil cases. The Cooper court emphasized that the threshold inquiry is "whether the indigent's position was likely to be of substance." Id at 172; see also Hodge v. Police Officers, 802 F.2d 58, 61 (2d Cir. 1986). Only where the plaintiff meets this threshold requirement of likely merit should the Court consider other criteria. See Cooper at 172. These secondary criteria include:
plaintiff's ability to obtain representation independently, and his ability to handle the case without assistance in the light of the required factual investigation, the complexity of the legal issues, and the need for expertly conducted cross-examination to test veracity.Id.; see also Hendricks v. Coughlin, 114 F.3d 390, 392 (2d Cir. 1997).
Having construed the Post-Conviction Motion as a second or successive habeas petition that must be transferred to the Second Circuit for review prior to a consideration of the merits, the Court is unable, and precluded by AEDPA from, determining whether Defendant's motion is likely to be one of substance. Therefore, the Court declines to appoint counsel at this time.
CONCLUSION
For the reasons stated above, the Court hereby TRANSFERS the Post-Conviction Motion to the Second Circuit for review, pursuant to the provisions of 28 U.S.C. § 2244(b)(3). In accordance with Defendant's request, the January 8 Motion, located at Entry 134 for docket number 98 CR 696, is hereby DISMISSED. Defendant's motion for appointment of counsel, located at Entry 35 for docket number 01 CV 7826, is hereby DENIED.
SO ORDERED.