United States v. Falcon

UNITED STATES, Appellee
v.
Esteban FALCON, Postal Clerk Seaman
U.S. Navy, Appellant
No. 07-0105
Crim. App. No. 200401483
United States Court of Appeals for the Armed Forces
Argued October 15, 2007
Decided January 9, 2008
ERDMANN, J., delivered the opinion of the court, in which
EFFRON, C.J., and BAKER, STUCKY, and RYAN, JJ., joined.
Counsel
For Appellant: Major Richard D. Belliss, USMC (argued);
Lieutenant Brian L. Mizer, JAGC, USN.
For Appellee: Lieutenant David H. Lee, JAGC, USN (argued);
Major Brian K. Keller, USMC (on brief); Commander Paul C.
LeBlanc, JAGC, USN, and Lieutenant Jessica M. Hudson, JAGC, USN.
Military Judge: John G. Baker
This opinion is subject to revision before final publication.
United States v. Falcon, No. 07-0105/NA
Judge ERDMANN delivered the opinion of the court.
Postal Clerk Seaman Esteban Falcon entered guilty pleas and
was convicted of two specifications of opening and stealing
mail, in violation of Article 134, Uniform Code of Military
Justice (UCMJ), 10 U.S.C. § 934 (2000), and three specifications
of making and uttering checks without sufficient funds, in
violation of Article 123a, UCMJ, 10 U.S.C. § 923a (2000). On
appeal to the United States Navy-Marine Corps Court of Criminal
Appeals, Falcon argued that the military judge erred in
accepting his guilty pleas to the bad check offenses without
first informing him of the availability of the “gambler’s
defense” that was recognized in United States v. Wallace, 15
C.M.A. 650, 653, 36 C.M.R. 148, 151 (1966). The Court of
Criminal Appeals found that the defense was not applicable to
the Article 123a, UCMJ, offenses and that the pleas were
provident. United States v. Falcon, 65 M.J. 582, 584-85 (N-M.
Ct. Crim. App. 2006). Before this court Falcon again argues
that his pleas were not provident to the bad check charges
because of the gambler’s defense. We agree with the conclusion
of the Court of Criminal Appeals and take this opportunity to
review the continuing validity of the Wallace decision. We find
that the rationale supporting the gambler’s defense is no longer
valid and therefore overrule Wallace.
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United States v. Falcon, No. 07-0105/NA
Falcon also asserts that during the providence inquiry the
military judge should have inquired into the possibility of a
partial mental responsibility defense because of statements made
during the trial relating to Falcon’s gambling addiction and his
diagnosis as pathological gambler. We hold that the military
judge did not abuse his discretion when he did not advise Falcon
of the possibility of a partial mental responsibility defense.
Background
Over the course of four months, Falcon wrote forty-nine
checks totaling $4300.00 at two enlisted clubs.1 Falcon
testified that he would cash his checks at the clubs’ cash cages
and immediately take the money and use it in the slot machines
located near the cash cages. Falcon stipulated that he knew
that he did not have enough money in his checking account to
cover the checks and that his conduct was wrongful and unlawful.
At the plea inquiry, Falcon stated he never represented to
the cashiers that he did not have enough money in the account to
cover the checks and his actions were designed to mislead the
staff into thinking each check was valid. Additionally, Falcon
1
Falcon was found guilty of three specifications of making and
uttering checks without sufficient funds. The Court of Criminal
Appeals’ factual summary reflects that he wrote forty-three
checks for a total of $3100.00. See United States v. Falcon, 65
M.J. 582, 583 (N-M. Ct. Crim. App. 2006). However, those
figures do not include the checks in the third specification.
The correct figures are forty-nine checks for a total of
$4300.00.
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United States v. Falcon, No. 07-0105/NA
stipulated that the clubs did not actively facilitate or
otherwise have any knowledge of any gambling that Falcon might
have engaged in after they cashed the checks. Falcon testified
he intended to defraud the two clubs through his check-writing
practices.
During the sentencing portion of the trial, Falcon
testified that he had a gambling addiction and described his
gambling practices. The Government called Staff Sergeant (SSgt)
Daniel Poole during sentencing, who was the head of the
Pathological Gambling Counseling Services program at the base
hospital. Poole testified that Falcon had been diagnosed as a
“pathological gambler” by a doctor at the Naval Hospital and
that Poole had performed an initial evaluation on Falcon and had
recommended counseling.
Discussion
Applicability of the Gambler’s Defense to Article 123a, UCMJ
In Wallace, the defendant was convicted under Article 134,
UCMJ, with making worthless checks by dishonorably failing to
maintain sufficient funds in his account. Id. at 650, 36 C.M.R.
at 148. Wallace held that under the circumstances of that case,
the failure to maintain sufficient funds was not “dishonorable”
and could not be the basis of a criminal prosecution. Id. at
653, 36 C.M.R. at 151. In addition, Wallace concluded that
courts should not lend their offices to the enforcement of
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United States v. Falcon, No. 07-0105/NA
gaming transactions that were against public policy. Id. at
653, 36 C.M.R. at 151. This aspect of Wallace has come to be
known as the gambler’s defense.
Falcon was charged with making worthless checks without
sufficient funds under Article 123a, UCMJ. He contends the
Wallace gambler’s defense should apply to Article 123a, UCMJ,
offenses as well as Article 134, UCMJ, offenses because there is
no substantive difference between the two offenses. He argues
that the policy considerations behind the defense should apply
for all worthless check offenses where, as here, the checks were
written to a military-operated club for cash that was spent in
the club’s nearby gambling facilities and where the worthless
checks were accepted with the club’s implicit awareness and
encouragement.
The Government responds that the two offenses contain
different elements and that an Article 134, UCMJ, offense occurs
after the check is written when the servicemember fails to keep
money in his or her account, as opposed to an Article 123a,
UCMJ, offense where the actus reus is complete when the check is
written. Due to the differences in the two statutes, the
Government argues that the gambler’s defense does not apply to
Article 123a, UCMJ, offenses.
The service courts are divided as to whether the Wallace
gambler’s defense applies to Article 123a, UCMJ, offenses. The
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United States v. Falcon, No. 07-0105/NA
Army Court of Criminal Appeals extended Wallace to Article 123a,
UCMJ, offenses but did so without analysis, simply assuming that
the gambler’s defense was applicable. See United States v.
Greenlee, 47 M.J. 613 (A. Ct. Crim. App. 1997); United States v.
Thompson, 47 M.J. 611 (A. Ct. Crim. App. 1997); United States v.
Green, 44 M.J. 828 (A. Ct. Crim. App. 1996). The Air Force
Court of Criminal Appeals held that the Wallace gambler’s
defense was not applicable to Article 123a, UCMJ, offenses based
on the structural differences in the statutes and the different
“intent” elements. United States v. Ewing, 50 M.J. 622, 627-28
(A.F. Ct. Crim. App. 1998). The Navy-Marine Corps Court of
Criminal Appeals, in the decision below, followed the Air Force
court’s approach. Falcon, 65 M.J. at 584.
A worthless check offense under Article 134, UCMJ, requires
that the accused “dishonorably fail[ed] to maintain funds” after
the check was made and uttered. Manual for Courts-Martial,
United States pt. IV, para. 68 (2005 ed.) (MCM). In contrast,
the elements of Article 123a, UCMJ, include knowledge by the
accused that the accused did not have sufficient funds at the
time of writing the check and “that the act was committed with
the intent to defraud.” MCM pt. IV, para. 49.b.(1). The
Article 134, UCMJ, offense does not require an intent to defraud
or knowledge by the accused that he has insufficient funds to
cover the check. In fact, Article 134, UCMJ, can be satisfied
6
United States v. Falcon, No. 07-0105/NA
with bad faith or gross indifference, which is a lesser mens rea
than the specific intent to defraud required in Article 123a,
UCMJ. See MCM pt. IV, para. 68.c. We therefore reject Falcon’s
argument that the elements of these two offenses are without
difference.
In Wallace, the court concluded that issuing worthless
checks to a service club, which accepted the checks for a
gambling transaction knowing they were worthless, was not
“dishonorable” conduct under Article 134, UCMJ. 15 C.M.A. at
653, 36 C.M.R. at 151. While the actions of the service club
impacted the “dishonorable” determination in Wallace, the
actions of the payee have no impact where an offense requires
the payor to act with a specific intent to defraud, as does
Article 123a, UCMJ. An Article 123a, UCMJ, offense, unlike an
Article 134, UCMJ, offense, is complete once the check is
proffered and before the club acts or the accused uses the money
for gambling, which further distinguishes the gambler’s defense
and Article 123a, UCMJ. See United States v. Margelony, 14
C.M.A. 55, 59, 33 C.M.R. 267, 271 (1963).
Based on these differences in the two statutes, we conclude
that the gambler’s defense does not extend to Article 123a,
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United States v. Falcon, No. 07-0105/NA
UCMJ, and that the military judge did not err in accepting
Falcon’s guilty pleas without informing him of the defense.2
Revisiting Wallace
We now turn to the background and underpinnings of the
gambler’s defense. In 1957, this court addressed a conviction
where the accused wrote worthless checks to co-participants in
an illegal gambling game, so that he could continue gambling.
United States v. Walter, 8 C.M.A. 50, 23 C.M.R. 274 (1957). The
court held that a conviction for larceny under those
circumstances could not be upheld because the actions in which
the participants were engaged were against public policy. Id.
at 53-54, 23 C.M.R. at 277-78. A year later, the court held
that a worthless check used to buy poker chips was “neither
legally nor morally” valid and that the accused’s refusal to
make good on a gambling debt was not “dishonorable.” United
States v. Lenton, 8 C.M.A. 690, 693-94, 25 C.M.R. 194, 197-98
(1958). Both of these decisions were based on public policy
considerations and dealt with gambling that was illegal.
Lenton, 8 C.M.A. at 693-94, 25 C.M.R. at 197-98; Walter, 8
C.M.A. at 53-54, 23 C.M.R. at 277-78.
2
Even if the gambler’s defense had been available to Falcon
under Article 123a, UCMJ, the facts in this record would not
support its application. Falcon admitted that the clubs had no
knowledge of his gambling practices or that the checks were
worthless.
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United States v. Falcon, No. 07-0105/NA
We next addressed the criminal liability of servicemembers
who wrote worthless checks to participate in gambling conducted
lawfully on a military installation. Wallace, 15 C.M.A. at 650,
36 C.M.R. at 148. Wallace was convicted under Article 134,
UCMJ, of dishonorably failing to maintain funds to support
checks he wrote to an officers’ club located in Germany. Id. at
650, 36 C.M.R. at 148. Wallace wrote these checks to the club
in exchange for quarters he used to play the slot machines in
the same club. Id. at 651, 36 C.M.R. at 149.
Wallace wrote checks of increasing value to cover the
returned checks. Id. at 651, 36 C.M.R. at 149. Although he had
no formal agreement with the club about his worthless checks,
the Board of Governors of the club (of which he was a member)
was aware of Wallace’s practice. Because the Board was
confident he would eventually pay these debts, it allowed the
practice to continue. Id. at 651, 36 C.M.R. at 149. As in
Walter and Lenton, the court’s decision was based on public
policy considerations. The court stated that the legality of
slot machines in American military establishments overseas was
an issue that they need not decide because “[w]hether gaming is
legal or illegal, transactions involving the same or designed to
facilitate it are against public policy, and the courts will not
lend their offices to enforcement of obligations arising
therefrom.” Id. at 651, 36 C.M.R. at 149.
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In reversing Wallace’s conviction, the court stated that
the “issuance of a worthless check in a gambling game or as a
means of facilitating a gaming transaction [could not] be made
the basis of a criminal prosecution.” Id. at 653, 36 C.M.R. at
151. The court also concluded that Wallace’s actions were not
dishonorable under Article 134, UCMJ, because the club
facilitated his bad-check writing practice by knowingly cashing
them. Id. at 653, 36 C.M.R. at 151.
Almost thirty years after Wallace, the Air Force Court of
Criminal Appeals rejected the rationale of Wallace in United
States v. Allbery, 41 M.J. 501, 502 (A.F. Ct. Crim. App. 1994).
The Air Force court found that legal gambling was not against
public policy and therefore “it no longer makes sense to follow
Wallace.” Id. On appeal, this court was unanimous in holding
that the lower court did not have the discretion to depart from
our precedents, although only a plurality found that public
policy as to gambling had not changed since Wallace. United
States v. Allbery, 44 M.J. 226, 227-31 (C.A.A.F. 1996).
The public policy rationale of Walter and Lenton was based
on the illegality of gambling. Wallace extended the public
policy basis for not criminalizing gambling debts to both
illegal and legal gambling. In the fifty years since Walter and
the forty-one years since Wallace, our society has seen legal
gambling grow both in acceptance and popularity. Governments at
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United States v. Falcon, No. 07-0105/NA
all levels sanction and often tax a broad scope of gambling
activities.3 Public policy relating to gambling is primarily a
legislative function, and therefore, courts look to legislative
enactments for determinations of public policy. Cf. Building
Serv. Employees Int’l Union, Local 262 v. Gazzam, 339 U.S. 532,
537-38 (1950) (finding legislative action on the organization of
laborers for bargaining purposes to be the state’s public
policy). There can be little dispute that public policy on
legal gambling has changed over the past fifty years. In this
environment, when the military allows gambling at service clubs
around the globe, it is inconsistent for this court to continue
to classify legal gambling as being against public policy.
Debts and offenses that result from legal gambling should
not be treated differently than those that occur from other
legal conduct. When a servicemember writes a check to
participate in legal gambling, he or she should not be able to
3
In fiscal year 2005 over $50 billion were spent on state
sponsored lotteries in the United States producing over $15
billion in revenue for the states. Alicia Hansen, Tax
Foundation, Gambling with Tax Policy: States’ Growing Reliance
on Lottery Tax Revenue 1 (2007), available at http://www.tax
foundation.org/files/bp54.pdf. In 2005 commercial casinos in
the United States took in over $30 billion and paid almost $5
billion in direct gaming taxes. American Gaming Association,
State of the States: The AGA Survey of Casino Entertainment 2
(2006), available at http://www.americangaming.org/assets/files
/2006_Survey_for_Web.pdf.
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rely on antiquated public policy to avoid his or her legal
obligations.4
We are “not unmindful of the importance that the doctrine
of stare decisis plays in our decision-making.” United States
v. Rorie, 58 M.J. 399, 406 (C.A.A.F. 2003). Applying stare
decisis is “‘the preferred course because it promotes the
evenhanded, predictable, and consistent development of legal
principles, fosters reliance on judicial decisions, and
contributes to the actual and perceived integrity of the
judicial process.’” Id. (quoting Payne v. Tennessee, 501 U.S.
808, 827 (1991)). However, “Stare decisis is not an inexorable
command; rather, it ‘is a principle of policy and not a
mechanical formula of adherence to the latest decision.’”
Payne, 501 U.S. at 828 (citation omitted).
The gambler’s defense was neither rooted in statute nor
constitutional law, but was a court-made principle based wholly
on public policy. Where a judicial decision is based on public
policy and that policy has changed, the doctrine of stare
decisis does not prohibit this court from revisiting that
4
We will address allegations that third party complicity negates
a required element of a charged offense on a case-by-case basis
and not with a sweeping defense based on public policy. The
government maintains the burden of proving each element beyond a
reasonable doubt and the accused remains free to raise such
facts that show his conduct does not satisfy a necessary
element.
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decision. Cf. Vasquez v. Hillery, 474 U.S. 254, 266 (1986).5 We
therefore conclude that Wallace should be, and is now,
overruled.6
Partial Mental Responsibility Defense
We now turn to whether the military judge abused his
discretion when he did not inquire into and resolve alleged
factual inconsistencies that arose during the sentencing portion
of the trial. During sentencing Falcon testified about his
gambling addiction and gambling practices, and SSgt Poole
testified that Falcon had been diagnosed as a pathological
gambler.
Falcon argues these statements are inconsistent with the
factual stipulation and his testimony during the providence
inquiry where he acknowledged he acted knowingly with the intent
to defraud. Falcon argues this inconsistency required the
military judge to reopen the providence inquiry and determine
whether the possibility of a defense of partial mental
5
The Supreme Court stated that precedent can be overruled if
“changes in society or in the law dictate that the values served
by stare decisis yield in favor of a greater objective.”
Vasquez v. Hillery, 474 U.S. 254, 266 (1986). The rise of
government sanctioned gambling reflects both a change in society
and a change in law.
6
We do not address the ongoing validity of United States v.
Walter, 8 C.M.A. 50, 23 C.M.R. 274 (1957), and United States v.
Lenton, 8 C.M.A. 690, 25 C.M.R. 194 (1958), because the case
before us addresses legal gambling and those cases dealt with
illegal gambling.
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responsibility existed. In contrast, the Government argues the
evidence raised only the “mere possibility” of a defense and
there is no authority to support the assertion that a
pathological gambling diagnosis could negate Falcon’s specific
intent to defraud the clubs.
“A guilty plea will be rejected only where the record of
trial shows a substantial basis in law and fact for questioning
the plea.” United States v. Harris, 61 M.J. 391, 398 (C.A.A.F.
2005). We review de novo the military judge’s legal conclusion
that an appellant’s pleas were provident. Id.A military judge is obligated to reopen the plea inquiry
when a possible defense has been raised and not satisfactorily
refuted because such a matter would be inconsistent with the
accused’s guilty plea. United States v. Shaw, 64 M.J. 460, 462
(C.A.A.F. 2007); see also Article 45(a), UCMJ, 10 U.S.C. § 845(2000). However, the “mere possibility” of a defense, without
more, does not give rise to this obligation. Shaw, 64 M.J. at
462 (citation omitted).
In Harris we held that where a military judge had
determined that the accused suffered from a severe mental defect
or disease at the time of the offenses, and the accused was not
aware that he suffered from such a disease at the time of the
offense, the military judge had an obligation to inquire into
the possible impact of those mental health issues on the
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appellant’s guilty pleas. 61 M.J. at 398. In Shaw we held that
the appellant’s reference to his diagnosis of bipolar disorder
without more, “at most raised only the ‘mere possibility’ of a
conflict with the plea.” 64 M.J. at 464.
Initially, we disagree with Falcon’s assertion that his
statements during sentencing were inconsistent with the
stipulation of facts and his earlier testimony. At sentencing
in response to a question from defense counsel if he ever
thought about how he was going to pay for his next bet, Falcon
responded, “I -- actually -- never really thought about it,
ma’am, it just happened. I mean -– I guess I was -– I guess
just write a check maybe get money to [gamble].” That testimony
does not directly contradict his earlier testimony that he knew
he was writing worthless checks and that he intended to defraud
the clubs. Similarly, the sentencing testimony that he had a
gambling addiction and had been diagnosed as a pathological
gambler does not directly contradict his earlier testimony that
he had a gambling problem and continued to gamble in order to
win back the money he lost and to feel the rush or high that
came from playing the slot machines.
Nor do we agree with Falcon’s contention that this
testimony placed the military judge on notice to make inquiry
into the possibility of a defense of partial mental
responsibility. In Shaw we held that the appellant’s reference
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United States v. Falcon, No. 07-0105/NA
to a bipolar disorder, without more, was not enough to require
the military judge to make further inquiry. 64 M.J. at 464. We
made that holding even though we had previously recognized that
a bipolar disorder may constitute a severe mental disease or
defect. See Harris, 61 M.J. at 397-98; United States v. Martin,
56 M.J. 97, 103 (C.A.A.F. 2001). While Harris and Martin
established that bipolar disorder “may exist with enough
severity to raise a substantial question regarding the issue of
the accused’s mental responsibility[,] . . . the disorder does
not negate responsibility in all cases.” Shaw, 64 M.J. at 463.
Falcon has provided no authority that a diagnosis of
pathological gambling can constitute a defense of lack of mental
responsibility or partial mental responsibility. One of the
factors the court looked at in Shaw was that there was no
factual record before the court indicating how, if at all,
Shaw’s condition influenced his plea. Id. at 462. Based on the
lack of any testimony that Falcon’s diagnosis could have
affected his ability to form the specific intent to defraud, and
on the lack of any authority that such a diagnosis may provide a
partial mental responsibility defense, we hold that the military
judge did not abuse his discretion when he failed to reopen the
providence inquiry.
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Conclusion
We hold the Wallace gambler’s defense does not apply to
Falcon’s Article 123a, UCMJ, 10 U.S.C. § 923a (2000), conviction
for worthless checks and that the military judge did not abuse
his discretion in not inquiring into a possible partial mental
responsibility defense. Finally, we prospectively overrule
United States v. Wallace, 15 C.M.A. 650, 36 C.M.R. 148 (1966),
and the concept of a gambler’s defense. The decision of the
United States Navy-Marine Corps Court of Criminal Appeals is
affirmed.
17