United States v. Daugerdas ( 2022 )

21-605-cr
United States v. Daugerdas
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
SUMMARY ORDER
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT.
CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS
PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE
32.1 AND THIS COURT=S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER
IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE
FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION
ASUMMARY ORDER@). A PARTY CITING TO A SUMMARY ORDER MUST SERVE
A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
At a stated term of the United States Court of Appeals for the Second
Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley Square,
in the City of New York, on the 31st day of January, two thousand twenty-two.
PRESENT:
AMALYA L. KEARSE,
JOHN M. WALKER, JR.,
RICHARD J. SULLIVAN,
Circuit Judges.
_____________________________________
United States of America,
Appellee,
v. No. 21-605
Paul M. Daugerdas,
Defendant-Appellant. ∗
_____________________________________
∗
The Clerk of Court is respectfully directed to amend the case caption as set forth above.
FOR APPELLEE: Stanley J. Okula, Jr., Nanette L. Davis, Special
Assistant United States Attorneys, David
Abramowicz, Assistant United States
Attorney, for Damian Williams, United States
Attorney for the Southern District of New
York, New York, NY.
FOR DEFENDANT-APPELLANT: Paul M. Daugerdas, pro se, Wilmette, IL.
Appeal from an order of the United States District Court for the Southern
District of New York (Pauley, J.).
UPON DUE CONSIDERATION, IT IS HEREBY ORDERED,
ADJUDGED, AND DECREED that the February 22, 2021 order of the district
court is AFFIRMED.
Paul M. Daugerdas was convicted after a jury trial of seven counts of tax
evasion and mail fraud in connection with a tax-fraud conspiracy that generated
over $160 million and from which he personally received over $95 million in
proceeds. The district court sentenced him to a 180-month term of imprisonment
followed by three years of supervised release; it also ordered him to forfeit
$164,737,500 and make restitution payments totaling $371,006,397. After an
unsuccessful appeal and petition for collateral review, Daugerdas filed a petition
for a writ of audita querela, arguing that the monetary penalties imposed against
2
him violate Honeycutt v. United States, 137 S. Ct. 1626 (2017), and Nelson v. Colorado,
137 S. Ct. 1249 (2017), both of which were decided after Daugerdas’s conviction
and appeal. 1 The district court denied the petition, and Daugerdas appealed.
Though Daugerdas was represented by counsel at trial and on direct appeal, he is
now proceeding pro se. We assume the parties’ familiarity with the underlying
facts, the procedural history of the case, and the issues on appeal.
We review de novo the grant or denial of a writ of audita querela. United
States v. Richter, 510 F.3d 103, 104 (2d Cir. 2007). While the writ has been
abolished in civil cases, it “remain[s] available in very limited circumstances with
respect to criminal convictions,” such as “where there is a legal, as contrasted with
an equitable, objection to a conviction that has arisen subsequent to the conviction
and that is not redressable pursuant to another post-conviction remedy.” United
States v. LaPlante, 57 F.3d 252, 253 (2d Cir. 1995); see also United States v. Valdez-
Pacheco, 237 F.3d 1077, 1079 (9th Cir. 2001) (noting that the writ “survive[s] only to
the extent that [it] fill[s] ‘gaps’ in the current systems of postconviction relief”). In
1
In Honeycutt, the Supreme Court held that under 21 U.S.C. § 853, “a defendant may [not] be
held jointly and severally liable for property that his co-conspirator derived from the crime but that
the defendant himself did not acquire,” 137 S. Ct. at 1630, while Nelson concluded that defendants
are entitled to be refunded any monetary penalties they have already paid pursuant to a conviction
if the conviction is subsequently vacated without retrial or nullified by acquittal upon retrial, 137
S. Ct. at 1252.
3
other words, the writ is unavailable if a defendant could have sought relief through
a direct appeal or a § 2255 motion.
The writ is unavailable here because Daugerdas could have sought relief
through other legal avenues. Daugerdas argues that the writ is the only way he
could have obtained relief from the monetary penalties that he claims are unlawful
under both Honeycutt and Nelson. Not so. Although a § 2255 motion generally
may not attack non-custodial aspects of a sentence, we have not “pronounced fines
and restitution orders to be, ipso facto, noncustodial so as categorically to preclude
their § 2255 review,” and instead “left open the possibility of a restitution order
imposing such a severe restraint on individual liberty as to” allow for a § 2255
challenge. United States v. Rutigliano, 887 F.3d 98, 105, 106 (2d Cir. 2018) (citations
and quotation marks omitted). Certainly, Daugerdas could have at least
attempted to argue in his § 2255 challenge that his monetary obligations – which
totaled over half a billion dollars – constituted such a restraint. He did not.
More importantly, Daugerdas could have raised his claims on direct appeal.
In fact, Daugerdas did challenge aspects of the forfeiture order in his direct
appeal — but not the joint and several liability he now challenges in seeking the
writ; he also asserted many of the arguments that he now brings forward under
4
Nelson about the validity of his convictions. See United States v. Daugerdas, 837
F.3d 212, 224–25, 228, 231 (2d Cir. 2016). Moreover, Daugerdas also had the
opportunity to raise a Honeycutt-type joint and several liability claim in his direct
appeal. The fact that our precedent at the time was unfriendly to such an
argument, see, e.g., United States v. Roberts, 660 F.3d 149, 165 (2d Cir. 2011), does not
mean that the claim was “not redressable,” LaPlante, 57 F.3d at 253, particularly
because Daugerdas appealed this court’s decision to the Supreme Court, which of
course would not have been bound by any of our joint and several liability cases,
see United States v. Daugerdas, 138 S. Ct. 62 (2017) (denying petition for certiorari).
Daugerdas thus procedurally defaulted by failing to raise his Honeycutt-type claim
on direct appeal.
Procedural default can be excused, however, if a defendant shows “cause
and prejudice” for his failure to raise an argument on appeal. Yick Man Mui v.
United States, 614 F.3d 50, 54 (2d Cir. 2010). Daugerdas attempts multiple
arguments to demonstrate “cause” sufficient to overcome his procedural default.
First, he argues that he should not have been required to raise a joint and several
liability challenge on direct appeal because our pre-Honeycutt precedent permitted
district courts to impose monetary penalties on that basis and any challenge would
5
have been unsuccessful. See, e.g., Roberts, 660 F.3d at 165. However, simply
positing that “a claim was unacceptable to [a] particular court at [a] particular
time” does not show “cause.” Gupta v. United States, 913 F.3d 81, 84–85 (2d Cir.
2019) (citation and quotation marks omitted). Indeed, “[t]he question is not
whether subsequent legal developments have made counsel’s task easier, but
whether at the time of the default the claim was available at all.” Id. at 85 (citation
and quotation marks omitted). And the joint and several liability argument was
available to Daugerdas. “Honeycutt was simply a matter of statutory
interpretation; the Supreme Court did not announce a new constitutional right or
overturn any Supreme Court precedent.” United States v. Bane, 948 F.3d 1290,
1297 (11th Cir. 2020) (holding that defendants failed to establish cause sufficient to
overcome procedural default). Daugerdas therefore cannot overcome his
procedural default simply because of our previously unfriendly precedent on joint
and several liability for forfeiture payments.
Daugerdas also argues that his appellate counsel’s ineffective assistance –
demonstrated by his failure to raise the joint and several liability claim on direct
appeal – constitutes adequate “cause.” The district court, however, correctly
determined that Daugerdas waived this claim by not raising it until his reply brief.
6
See Knipe v. Skinner, 999 F.2d 708, 711 (2d Cir. 1993). Even if it was not waived
before the district court, it is waived on appeal, as Daugerdas merely makes a
conclusory allegation — without additional argument — as to his former counsel’s
efforts. 2 See Niagara Mohawk Power Corp. v. Hudson River-Black River Regulating
Dist., 673 F.3d 84, 107 (2d Cir. 2012) (“Merely mentioning or simply stating an issue
in an appellate brief is insufficient to preserve it for our review.”) (citation and
quotation marks omitted) (alterations adopted).
Nor can Daugerdas establish entitlement to a writ of audita querela based on
his Nelson claim. This argument is likewise procedurally defaulted, and
Daugerdas is unable to establish “cause and prejudice” for his failure to raise it on
direct appeal or in his § 2255 petition. It also clearly fails on the merits. In
Nelson, the Supreme Court held that criminal defendants do not have to pay
restitution once their convictions are vacated without a contemplated retrial or if
they are acquitted after a retrial. 137 S. Ct. at 1252. Daugerdas was convicted of
seven charges of conspiracy, mail fraud, and tax evasion, and his restitution and
2
Although pro se litigants are generally entitled to special solicitude, including the liberal
construction of their pleadings and briefs to effectively raise all arguments they attempt to invoke,
Daugerdas is not so entitled because he was an attorney – albeit now a disbarred one. Tracy v.
Freshwater, 623 F.3d 90, 101–02 (2d Cir. 2010) (stating that “a lawyer representing himself
ordinarily receives no such solicitude”); see also United States v. Pierce, 649 F. App’x 117, 117
n.1 (2d Cir. 2016) (summary order) (declining to afford “special solicitude” to disbarred attorneys
proceeding pro se).
7
forfeiture obligations were imposed pursuant to those convictions, which we
affirmed on appeal. His insistence that the district court improperly imposed
monetary penalties in connection with counts on which he was actually acquitted
is simply incorrect. See Daugerdas, 837 F.3d at 231 (“The district court correctly
concluded that the money sought to be forfeited had been obtained through
Daugerdas’s mail fraud.”). Because Daugerdas’s monetary penalties were
imposed pursuant to valid convictions, Nelson does not apply.
We have considered Daugerdas’s remaining arguments and find them to be
without merit. Accordingly, we AFFIRM the order of the district court.
FOR THE COURT:
Catherine O=Hagan Wolfe, Clerk of Court
8