United States v. Michael Butler ( 2016 )

NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS AUG 9 2016
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, No. 15-30061
Plaintiff-Appellee, D.C. No.
3:13-cr-00080-SLG-1
v.
MICHAEL BUTLER, MEMORANDUM*
Defendant-Appellant.
Appeal from the United States District Court
for the District of Alaska
Sharon L. Gleason, District Judge, Presiding
Submitted August 2, 2016**
Anchorage, Alaska
Before: FISHER, PAEZ, and HURWITZ, Circuit Judges.
Michael Butler was convicted after a jury trial of ten counts of mail fraud, 18
U.S.C. § 1341, one count of conspiracy to launder money, 18 U.S.C. § 1956(h), and
one count of conspiracy to make false statements regarding the distribution of
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The panel unanimously concludes this case is suitable for decision without
oral argument. See Fed. R. App. P. 34(a)(2).
cigarettes, 18 U.S.C. §§ 371, 2342(b), 2344(b). Butler challenges the district court’s
refusal to compel the testimony of his codefendant and former stepdaughter, Kim
Sims-Crandell, who had pleaded guilty but was awaiting sentencing. He also argues
that there was insufficient evidence to satisfy the mailing requirement of 18 U.S.C.
§ 1341. We affirm.
1. As Butler recognizes, Mitchell v. United States holds that the Fifth
Amendment privilege against self-incrimination extends through sentencing. 526
U.S. 314, 325-27 (1999). He argues, however, that we should exempt from the
Mitchell rule witnesses who, like Sims-Crandell, have entered plea agreements under
Federal Rule of Criminal Procedure 11(b) in which the government has agreed to a
particular sentencing recommendation.
2. We disagree. “The purpose of Rule 11 is to inform the defendant of what
she loses by forgoing the trial, not to elicit a waiver of the privilege for proceedings
still to follow. A waiver of a right to trial with its attendant privileges is not a waiver
of the privileges which exist beyond the confines of the trial,” including the “right
to remain silent at sentencing.” Id. at 324, 325. Thus, “[a] convicted but
unsentenced defendant retains his Fifth Amendment rights.” United States v. Paris,
827 F.2d 395, 399 (9th Cir. 1987). The district court was not required to follow the
government’s sentencing recommendation, and incriminating testimony elicited
from Sims-Crandell could have established relevant conduct for sentencing
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purposes. See U.S. Sentencing Guidelines Manual § 1B1.3 (U.S. Sentencing
Comm’n 2015). The district court therefore did not err in concluding that Sims-
Crandell “could legitimately refuse to answer essentially all relevant questions” and
refusing to compel her testimony. United States v. Klinger, 128 F.3d 705, 709 (9th
Cir. 1997) (quoting United States v. Tsui, 646 F.2d 365, 368 (9th Cir. 1981)).
3. “There are two elements in mail fraud: (1) having devised or intending to
devise a scheme to defraud . . . and (2) use of the mail for the purpose of executing,
or attempting to execute, the scheme.” Schmuck v. United States, 489 U.S. 705, 721
(1989). “To be part of the execution of the fraud, however, the use of the mails need
not be an essential element of the scheme. It is sufficient for the mailing to be
incident to an essential part of the scheme, or a step in the plot.” Id. at 710-11(alterations, citations, and quotation marks omitted). Butler argues that the
fraudulent scheme was “complete each time [he] received cigarettes from the
wholesalers,” and that the tax returns submitted by wholesalers detailing the number
of cigarettes sold that were exempt from Anchorage’s excise tax were therefore not
mailed in furtherance of that scheme. The Court rejected a virtually identical
argument in Schmuck. In that case, the defendant purchased used cars, rolled back
their odometers, and sold the cars to retail dealers at inflated prices. 489 U.S. at 707.
The innocent dealers then resold the cars to customers, and mailed title
applications—legally required in order to transfer title of the cars—to the state
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Department of Transportation. Id. In rejecting Schmuck’s argument that the
mailings were “routine and innocent” and made “after the fraud ha[d] come to
fruition,” the Court found that the scheme was an “ongoing fraudulent venture”
which “would have come to an abrupt halt if the dealers either had lost faith in
Schmuck or had not been able to resell the cars obtained from him.” Id. at 711-12.
The tax returns here were likewise “a step in the plot” “essential to the perpetuation”
of the ongoing fraudulent scheme. Id. (alteration and quotation marks omitted).
AFFIRMED.
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