United States v. McNamara ( 1996 )

PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
UNITED STATES OF AMERICA,
Plaintiff-Appellant,
v. No. 95-6126
WARREN HARDING MCNAMARA, JR.,
Defendant-Appellee.
Appeal from the United States District Court
for the Eastern District of Virginia, at Newport News.
Robert E. Payne, District Judge.
(CR-93-50, CA-94-58-4)
Argued: September 27, 1995
Decided: February 2, 1996
Before ERVIN, Chief Judge, and RUSSELL and HAMILTON,
Circuit Judges.
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Reversed and remanded by published opinion. Judge Russell wrote
the opinion, in which Chief Judge Ervin and Judge Hamilton joined.
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COUNSEL
ARGUED: William Graham Otis, Senior Litigation Counsel,
UNITED STATES ATTORNEY'S OFFICE, Alexandria, Virginia,
for Appellant. Kevin Paul O'Connell, KEVIN O'CONNELL, P.C.,
Portland, Oregon, for Appellee. ON BRIEF: Helen F. Fahey, United
States Attorney, Vincent L. Gambale, Assistant United States Attor-
ney, Alexandria, Virginia, for Appellant. Ronald L. Smith, Hampton,
Virginia, for Appellee.
OPINION
RUSSELL, Circuit Judge:
On July 19, 1993, a federal jury convicted Warren Harding McNa-
mara, Jr. ("McNamara") of illegally structuring financial transactions
to avoid currency reporting requirements in violation of 31 U.S.C.
§ 5324(a)(3) ("antistructuring law") and§ 5322(a). He received
twenty-one months imprisonment, three years supervised release, and
a $4,000 fine. One year later after forgoing direct appeal of either his
conviction or sentence, McNamara filed a motion under 28 U.S.C.
§ 2255 asking the district court to vacate his sentence. He advanced
two grounds for his motion: (1) that he was denied effective assis-
tance of counsel because his trial counsel had failed to object to the
jury instruction on the "willfulness" element of unlawful structuring;
and (2) that there had been an intervening substantive change in the
antistructuring law which required a reversal of his conviction.
The district court found ineffective assistance of counsel and
granted McNamara's motion, vacating his sentence and ordered a new
trial. McNamara v. United States, 867 F. Supp. 369 (E.D. Va. 1994).
The district court reasoned that McNamara's trial counsel should have
objected to the jury instruction because at the time of trial, the
Supreme Court had granted certiorari in Ratzlaf v. United States, 976
F.2d 1280 (9th Cir. 1992), a case addressing the willfulness element
of the antistructuring statutes. In accordance with our recent decision
in Kornahrens v. Evatt, 66 F.3d 1350 (4th Cir. 1995), we reject the
district court's holding and conclude that McNamara's counsel was
neither ineffective for following the controlling circuit law at the
time, nor for being unaware that the Supreme Court had granted
certiorari in Ratzlaf.
I.
The antistructuring law under which McNamara was convicted
makes it a crime for an individual to "structure or assist in structuring
or attempt to structure or assist in structuring, any transaction with
one or more domestic financial institutions." 31 U.S.C. § 5324(a)(3).
And section 5322(a) provides the punishment for a person "willfully
violating this subchapter or a regulation prescribed under this sub-
2
chapter . . . ." 31 U.S.C. § 5322(a) (1988), amended by 31 U.S.C.A.
§ 5322(a) (Supp. 1994) (emphasis added). This Circuit's controlling
authority, in 1993, did not require the defendant to have specific
knowledge of the illegality of his conduct. See United States v.
Rogers, 962 F.2d 342, 345 (4th Cir. 1992). The district court was not
required, therefore, to instruct juries that the government must prove
that the defendant knew his conduct was illegal. 1 In April of 1993, 90
days prior to McNamara's trial, the Supreme Court granted certiorari
in a Ninth Circuit case to resolve a conflict in the circuits on
"[whether] a defendant's purpose to circumvent a bank's reporting
obligation suffice[s] to sustain a conviction for ``willfully violating'
the antistructuring provision." Ratzlaf v. United States, 114 S. Ct. 655,
657 (1994). Six months after McNamara's sentence, the Supreme
Court overruled Rogers (and the decisions of nine other courts of
appeal),2 holding that the structuring statute did, in fact, require the
Government to prove that the defendant acted with specific knowl-
edge that his conduct was illegal. Id. Because of Ratzlaf, juries must
be instructed that in order to convict the defendant of structuring, they
find that he knew he was engaged in unlawful conduct.
Following the Supreme Court's Ratzlaf decision, the district court
found that if McNamara's trial counsel had more thoroughly prepared
for trial, his research would have discovered the certiorari grant in
Ratzlaf and he would have preserved the issue for appeal. Specifi-
cally, the district court concluded that:
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1 Bound by Rogers, the district court submitted an instruction on will-
fulness to the jury. Neither the Government nor McNamara's trial coun-
sel objected to the instruction or brought Ratzlaf to the court's attention.
2 Prior to McNamara's trial, nine other circuits had issued opinions in
accord with our holding in Rogers. See United States v. Scanio, 900 F.2d
485 (2d Cir. 1990); United States v. Shirk, 981 F.2d 1382 (3d Cir. 1992);
United States v. Beaumont, 972 F.2d 91 (5th Cir. 1992); United States
v. Baydoun, 984 F.2d 175 (6th Cir. 1993); United States v. Jackson, 983
F.2d 757 (7th Cir. 1993); United States v. Gibbons, 968 F.2d 639 (8th
Cir. 1992); United States v. Hoyland, 914 F.2d 1125 (9th Cir. 1990);
United States v. Dashney, 937 F.2d 532 (10th Cir. 1991), cert. denied,
112 S. Ct. 402 (1991); United States v. Brown , 954 F.2d 1563 (11th Cir.
1992).
3
[A] lawyer must be aware of the fact that an element of an
offense he must defend at trial is under examination by the
Supreme Court, particularly where the decision on that issue
has the potential to alter the controlling rule in the circuit
and likely will be issued while his client's case is on direct
appeal if an appeal is taken. At least at the confluence of
these factors, it is beyond the wide range of acceptable pro-
fessional conduct to be unaware of developments in the law.
McNamara, 867 F. Supp. at 376. Accordingly, the district court held
McNamara's trial counsel to be constitutionally deficient for failing
to object to the willfulness element of the instruction.3
In accordance with our recent opinion in Kornahrens, we find the
district court's reasoning unpersuasive. In Kornahrens, we examined
whether Kornahrens' trial counsel was constitutionally ineffective for
failing to preserve an issue at trial based merely on the Supreme
Court's grant of certiorari in a case which raised the issue. Specifi-
cally, at the time of Kornahrens' trial, South Carolina law prohibited
the proffering of expert evidence of future adaptability. The Supreme
Court had granted certiorari in State v. Skipper, 328 S.E.2d 58 (S.C.),
cert. granted, 474 U.S. 900 (1985), to review the constitutionality of
this practice. The Supreme Court eventually overturned the South
Carolina law prohibiting admission of this evidence. Skipper v. South
Carolina, 476 U.S. 1 (1986). Kornahrens asserted his trial counsel
was ineffective for failing to preserve the admissibility issue in light
of the grant of certiorari in Skipper . We rejected Kornahrens' argu-
ments and held that an attorney's failure to anticipate a new rule of
law was not constitutionally deficient. Kornahrens, 66 F.3d at 1360.
Our decision in Kornahrens is consistent with our prior decisions in
this area. We concluded that Kornahrens' trial counsel was not consti-
tutionally deficient "because he followed a long-standing and well-
settled rule of South Carolina criminal law--even when that rule was
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3 Applying the Strickland v. Washington, 466 U.S. 668 (1984), analysis
for determining ineffective assistance of counsel, the district court found
that McNamara was prejudiced by his trial counsel's constitutionally
deficient performance. Because we hold that the district court erred in
finding counsel's performance deficient, we need not reach the prejudice
issue.
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under attack in the United States Supreme Court at the time of trial."
Id. See also Honeycutt v. Mahoney, 698 F.2d 213, 217 (4th Cir. 1983)
(holding that defendant's trial counsel was not ineffective for failing
to object to instruction regarding presumptions of malice and unlaw-
fulness, where Supreme Court decisions supporting challenges to
such presumptions had not yet been rendered at time of trial);
Nickerson v. Lee, 971 F.2d 1125, 1136 (4th Cir. 1992), cert. denied,
113 S. Ct. 1289 (1993) (holding that Nickerson's trial counsel could
not have been expected to object to the State's peremptory challenges,
despite that certiorari in Batson had been granted six months before
trial, since Nickerson's trial predated the Batson decision by several
months); Randolph v. Delo, 950 F.2d 243 (8th Cir. 1991), cert.
denied, 504 U.S. 920 (1992) (ruling that trial counsel was not ineffec-
tive by failing to raise Batson challenge two days before Batson was
decided).
We find Kornahrens directs this case's disposition. Like
Kornahrens, McNamara's trial counsel, mindful of the controlling cir-
cuit law at the time, had no basis for objecting to the willfulness ele-
ment of the given jury instruction. Furthermore, post-trial testimony
reveals that McNamara's trial counsel made adequate efforts to pre-
pare himself for trial. In light of these facts and our previous deci-
sions, we conclude that the district court erred in finding McNamara's
trial counsel to be constitutionally deficient.
II.
Although McNamara's § 2255 motion requested that his sentence
be vacated pursuant to Ratzlaf, the district court did not address
whether McNamara could retroactively take advantage of the substan-
tive rule announced in Ratzlaf. Because we believe that a more thor-
ough discussion of Ratzlaf's retroactive application to McNamara's
appeal would be dispositive, we remand this issue to the district court
for further proceedings.
III.
For the foregoing reasons, we reverse the district court's order,
reinstate McNamara's sentence, and remand the case to the district
5
court for further consideration of the retroactive application of the
substantive rule in Ratzlaf.
REVERSED AND REMANDED
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