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[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 12-13608
________________________
D.C. Docket No. 5:11-cr-00207-VEH-PWG-1
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
versus
JERRY DWAYNE LANG,
Defendant - Appellant.
________________________
Appeal from the United States District Court
for the Northern District of Alabama
________________________
(October 3, 2013)
Before CARNES, Chief Judge, TJOFLAT, Circuit Judge, and MARRA,* District
Judge.
CARNES, Chief Judge:
* Honorable Kenneth A. Marra, United States District Judge for the Southern District of
Florida, sitting by designation.
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The lifeblood of many crimes is cash. So that federal law enforcement can
more readily trace the flow of large amounts of cash, the law requires a financial
institution to file with the Department of the Treasury reports of cash transactions
by any person on a single day that exceed $10,000. If that were all, the reporting
requirement could be evaded through the simple expedient of dividing large cash
transactions into amounts small enough not to trigger it. To prevent that and
similar end runs, the law makes it a crime to structure cash transactions for the
purpose of evading the reporting requirement. See
31 U.S.C. § 5324(a)(3).
Jerry Lang was indicted on 85 counts of violating § 5324(a)(3). See App. A
to this opinion. The jury acquitted him of 15 of those counts (1–12, 15, and 72–73)
and convicted him of the other 70. He raises several issues in this direct appeal,
but we need not go beyond his challenge to the sufficiency of the indictment.
An indictment is sufficient if it: “(1) presents the essential elements of the
charged offense, (2) notifies the accused of the charges to be defended against, and
(3) enables the accused to rely upon a judgment under the indictment as a bar
against double jeopardy for any subsequent prosecution for the same offense.”
United States v. Dabbs,
134 F.3d 1071, 1079 (11th Cir. 1998). Because Lang
failed to challenge the indictment in the district court, however, we must find it
sufficient “unless it is so defective that it does not, by any reasonable construction,
charge an offense for which the defendant is convicted.” United States v. Pena,
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684 F.3d 1137, 1147 (11th Cir. 2012) (quoting United States v. Gray,
260 F.3d
1267, 1282 (11th Cir. 2001)). If the indictment “provides facts and the specific
statute under which the defendant is charged, the court will find the indictment
sufficient.”
Id. at 1148. The indictment in this case does not provide the necessary
factual allegations. It fails under any reasonable construction to charge all of the
elements of the offense.
Section 5324(a)(3) prohibits a person from “structur[ing] or assist[ing] in
structuring, or attempt[ing] to structure or assist in structuring, any transaction with
one or more domestic financial institutions” for the purpose of evading
31 U.S.C. §
5313(a)’s requirement that a financial institution report to the government cash
transactions exceeding a particular amount.
31 U.S.C. §§ 5324(a)(3), 5313(a).
That amount is set by regulation at $10,000.00.
31 C.F.R. § 1010.311
(implementing § 5313(a) and setting the reporting threshold at “more than
$10,000”). Section 5324 does not expressly define the term “structuring,” but the
Supreme Court has explained that the crime of structuring includes “break[ing] up
a single transaction above the reporting threshold into two or more separate
transactions . . . for the purpose of evading a financial institution’s reporting
requirement.” Ratzlaf v. United States,
510 U.S. 135, 136,
114 S.Ct. 655, 657
(1994).
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Another regulation promulgated under § 5313(a), the statute requiring
financial institutions to file currency transaction reports, provides that a person
structures a transaction if he:
conducts or attempts to conduct one or more transactions in currency, in any
amount, at one or more financial institutions, on one or more days, in any
manner, for the purpose of evading the reporting requirements under
§ 1010.311.
31 C.F.R. § 1010.100(xx). In order to be “for the purpose of evading” the
reporting requirements, the structured transaction must involve an amount that is
more than $10,000; otherwise, evasion would not be necessary or possible because
there would be no reporting requirement anyway.
When the evasion takes the form of breaking down a single amount that
exceeds $10,000 into cash transactions that do not, the question arises whether one
or more than one structuring crime has been committed. Two other circuits have
answered that question about the proper unit of prosecution for structuring. In
United States v. Davenport,
929 F.2d 1169, 1171–72 (7th Cir. 1991), the defendant
was convicted of twelve counts. The first charged a conspiracy to structure; the
second charged the structuring of $81,500 in proceeds from a transaction by
breaking that amount into ten deposits of cash, each under $10,000; and the last ten
counts individually charged that each one of those ten deposits of cash was a
separate structuring crime. The Seventh Circuit held that those last ten counts
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“should have been thrown out” because “[t]he statute does not forbid the making of
deposits. It forbids the structuring of a transaction.”
Id. at 1171. The court
explained that the one substantive structuring crime was breaking up the larger
amount of cash, the deposit of which would have exceeded the reporting threshold
had it not been divided into smaller amounts.
Id. The conclusion: “[T]he
structuring itself, and not the individual deposit, is the unit of crime.”
Id. at 1172.
The Tenth Circuit reached the same conclusion in United States v. Nall,
949
F.2d 301 (10th Cir. 1991). There a third party paid the defendant $26,000, from
which the defendant paid $24,000 to a bank as mortgagor; he did so with cash
payments of $9,000, $9,000, and $6,000 on three separate days.
Id. at 307–08.
The indictment charged each of those three cash payments as a separate structuring
crime, but the Tenth Circuit held that there was only one structuring crime, which
was comprised of the three cash payments.
Id. We agree with the Seventh and
Tenth Circuits and hold that the proper unit of prosecution in structuring is the
amount exceeding the reporting threshold that is structured into smaller amounts
below that threshold, not each of the resulting sub-threshold transactions.
In this case, each count of the indictment charges as a separate structuring
crime a currency transaction involving a single check. Each check alleged is for an
amount less than $10,000, and no combination of two or more checks is alleged in
any count. See App. A. A cash transaction involving a single check in an amount
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below the reporting threshold cannot in itself amount to structuring because the
crime requires a purpose to evade the reporting requirement, and that requirement
does not apply to a single cash transaction below the threshold. The government’s
theory (at least its current theory) is that Lang received from one source 21
payments exceeding $10,000 over a period of eight months, he had those larger
payments broken into multiple checks each of which was less than $10,000, and he
then cashed those checks separately in a way that evaded the reporting
requirements. That is all well and good, but it is not what is alleged in the
indictment. Instead of a series of counts each alleging a payment or payments
totaling more than $10,000 that were structured into checks of smaller amounts,
which were then cashed, the indictment consists of 85 counts each of which
separately alleges that a single check in an amount less than $10,000 was
structured. That is not possible. When cashed checks come to the structuring
dance, it takes at least two to tango.
Paragraph 1, which is realleged by reference into each count, does state that
Lang’s alleged structuring was “part of a pattern of illegal activity involving more
than $100,000 in a 12-month period.” That is not, however, a sufficient allegation
of the government’s belated grouping theory. The government does not contend
that Lang structured a single payment exceeding $100,000 by breaking it down
into amounts of $10,000 or less. Instead, the quoted language is an attempt to
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plead the factual predicate for the enhanced penalties provided by
31 U.S.C. §
5324(d)(2) (“Whoever violates this section while violating another law of the
United States or as part of a pattern of any illegal activity involving more than
$100,000 in a 12-month period shall be” subject to a higher fine and sentence of
imprisonment.).
We cannot combine the allegations from separate counts to allege what the
indictment itself does not. Instead, “each count of an indictment must be regarded
as if it were a separate indictment and must stand on its own content without
dependence for its validity on the allegations of any other count not expressly
incorporated.” United States v. Huff,
512 F.2d 66, 69 (5th Cir. 1975). 1
Allegations in one count of an indictment are not automatically incorporated into
another; express incorporation is required. United States v. Schmitz,
634 F.3d
1247, 1262 (11th Cir. 2011). We have said that where a challenge to the
sufficiency of an indictment is raised for the first time on appeal, “the court can
consider the content of other counts of the indictment in order to give context to
the challenged count so long as the defendant fails to show actual prejudice.”
Pena, 684 F.3d at 1148 n.8. The problem here, however, is not lack of context but
the failure to plead a crime in any of the counts. When every count suffers from
1
In Bonner v. City of Prichard,
661 F.2d 1206, 1209 (11th Cir.1981) (en banc), we
adopted as binding precedent all decisions of the former Fifth Circuit handed down before
October 1, 1981.
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the same insufficiency, nothing pleaded in one insufficient count can cure the
insufficiency in another. Because all of the parts suffer from the same problem,
the whole cannot solve it. The only way to remedy the defects in the indictment
would be to rewrite it, and that we may not do. See Huff,
512 F.2d at 69 (“A grand
jury indictment may be amended only by resubmission to a grand jury ‘unless the
change is merely a matter of form.’”) (quoting Russell v. United States,
369 U.S.
749, 770–71,
82 S.Ct. 1038, 1050 (1962)).
For these reasons, we conclude that the indictment is “so defective that it
does not, by any reasonable construction, charge an offense for which the
defendant is convicted.” Pena, 684 F.3d at 1147 (quotation marks omitted). This
is not a mere multiplicity situation where some counts may be upheld if others are
vacated. See United States v. Bonavia,
927 F.2d 565, 571 (11th Cir. 1991); United
States v. Mastrangelo,
733 F.2d 793, 802 (11th Cir. 1984). Where no count in the
indictment charges a crime, the defendant is entitled to have the judgment vacated
and the case remanded with instructions that the indictment be dismissed.
Accordingly, the judgment is VACATED and the case is REMANDED with
directions that the indictment is to be dismissed.
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