United States v. Jodi C. Silvio

[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
FILED
________________________ U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
MARCH 28, 2012
No. 10-14228
JOHN LEY
________________________
CLERK
D. C. Docket No. 1:08-cr-00327-CG-B-1
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
A. SAMUEL KELLEY, II,
Defendant-Appellant.
________________________
No. 10-14560
________________________
D.C. Docket No. 1:08-cr-00327-CG-B-2
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
JASON R. KELLEY,
Defendant-Appellant.
________________________
No. 10-14791
________________________
D.C. Docket No. 1:08-cr-00327-CG-B-3
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
JODI C. SILVIO,
Defendant-Appellant.
________________________
Appeals from the United States District Court
for the Southern District of Alabama
________________________
(March 28, 2012)
Before DUBINA, Chief Judge, COX, Circuit Judge and GOLDBERG,* Judge.
*
Honorable Richard W. Goldberg, United States Court of International Trade Judge, sitting
by designation.
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PER CURIAM:
Samuel Kelley, Jason Kelley, and Jodi Silvio (collectively “Appellants”)
were convicted by a jury for conspiring to distribute and dispense anabolic
steroids—a controlled substance—outside the usual course of professional
practice and without a legitimate medical purpose, in violation of 21 U.S.C. § 846;
illegally distributing anabolic steroids to both adults and persons under the age of
21, in violation of 18 U.S.C. § 2 and 21 U.S.C. §§ 841(a) and 859(a); money
laundering, in violation of 18 U.S.C. § 1956(a)(1)(A)(i); and money laundering
conspiracy, in violation of 18 U.S.C. § 1956(h). Sam Kelley and Jason Kelley
were sentenced to 120 months’ imprisonment, followed by four years of
supervised release, while Silvio was sentenced to 78 months’ imprisonment,
followed by three years of supervised release. Appellants urge reversal of their
convictions because they contend (1) there was insufficient evidence to support
their convictions on each charge; (2) the district court improperly denied Samuel
Kelley’s motion for severance; (3) the district court incorrectly ruled on various
evidentiary issues; (4) the district court improperly rejected their requested jury
instructions; (5) the prosecutor’s remarks during the opening and closing
statements were improper; and (6) the district court abused its discretion in
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denying their motion for a mistrial or a new trial. For the foregoing reasons, we
reject the Appellants’ arguments and affirm their convictions.
I.
Sam Kelley was the President and Chief Executive Officer of Applied
Pharmacy Services (“Applied”), Jason Kelley was the Chief Operating Officer and
Treasurer, and Silvio was a part-time pharmacist, part-owner, and Secretary.
Applied was a compounding pharmacy that combined drug ingredients to create
patient-specific medications that were not commercially available. At trial, the
Government presented evidence that Applied filled steroid prescriptions for clients
who wished to become more muscular. Evidence was also presented that Sam and
Jason Kelley facilitated those transactions by cultivating relationships with doctors
who were willing to prescribe steroids for no legitimate medical purpose and with
salesmen who pursued high volume sales without regard to actual medical need.
Between March 2003 and August 2006, Applied illegally dispensed a significant
amount of anabolic steroids from its base in Mobile, Alabama, to recipients across
the country. As a result of these relationships and sales, Applied became very
profitable, and Appellants were compensated with monthly dividends of
approximately $500,000 for Jason Kelley and Silvio and approximately
$1,000,000 for Sam Kelley. The Government presented evidence that Applied
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continued its suspect steroid dispensing practices despite warnings from the
Alabama Board of Pharmacy and the United States Drug Enforcement Agency.
Steroids are a regulated Schedule III controlled substance under federal
law—they have some accepted medical uses with a moderate potential for abuse.
Some types of steroids are approved only for use in animals and must be
prescribed by a licensed veterinarian. Because steroids are a controlled substance,
pharmacists bear a responsibility to ensure the drugs are properly prescribed and
dispensed. A pharmacist can legally dispense steroids only if a physician acting in
the usual course of professional practice issues a prescription for a legitimate
medical purpose. A pharmacist who fills a prescription knowing it is invalid is in
violation of the controlled substance laws.
II.
Challenges as to the sufficiency of the evidence are reviewed de novo, with
this court viewing the evidence “in the light most favorable to the government,
with all inferences and credibility choices drawn in the government’s favor.”
United States v. Garcia-Bercovich, 582 F.3d 1234, 1237 (11th Cir. 2009) (internal
quotation marks omitted) cert. denied, 130 S. Ct. 1562 (2010). A district court’s
denial of a motion to sever will not be reversed absent a “clear abuse of
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discretion.” United States v. Chavez, 584 F.3d 1354, 1360 (11th Cir. 2009) cert.
denied, 131 S. Ct. 436 (2010).
This court reviews a district court’s evidentiary rulings for abuse of
discretion. United States v. Perez-Oliveros, 479 F.3d 779, 783 (11th Cir. 2007).
However, where Appellants fail to contemporaneously object to an evidentiary
ruling, this court will review the ruling for plain error. United States v. Turner,
474 F.3d 1265, 1275 (11th Cir. 2007). Finally, this court will review de novo
whether an evidentiary ruling violated a constitutional guarantee. United States v.
Sarras, 575 F.3d 1191, 1210 n.24 (11th Cir. 2009).
This court reviews the district court’s denial of a requested jury instruction
for abuse of discretion. United States v. Morris, 20 F.3d 1111, 1114 (11th Cir.
1994). Appellants timely objected to the prosecutor’s remarks during closing
argument; therefore, the propriety of those remarks will be reviewed de novo. See
United States v. Schmitz, 634 F.3d 1247, 1259 (11th Cir. 2011). Because
Appellants did not timely object to the prosecutor’s remarks during the opening
statement, we will review the propriety of those remarks for plain error. Id. This
court reviews a district court’s denial of motions for a mistrial and for a new trial
for abuse of discretion. See Chavez, 584 F.3d at 1362; United States v. Hunt, 526
F.3d 739, 744 n.1 (11th Cir. 2008).
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Lastly, this court reviews the district court’s denial of a requested jury
instruction for abuse of discretion. United States v. Morris, 20 F.3d 1111, 1114
(11th Cir. 1994). The refusal to give a certain jury instruction is reversible error
only if “(1) the requested instruction was a correct statement of law, (2) its subject
matter was not substantially covered by other instructions, and (3) its subject
matter dealt with an issue in the trial that was so important that failure to give it
seriously impaired [Appellants’] ability to defend [themselves].” United States v.
Dean, 487 F.3d 840, 847 (11th Cir. 2007) (per curiam).
III.
A. Sufficiency of the Evidence1
i. Distributing and Conspiring to Distribute Anabolic Steroids
In order to establish the Appellants engaged in a conspiracy to distribute
steroids, the Government must have presented sufficient evidence that there was an
agreement between two or more people to unlawfully dispense steroids outside the
1
Jason Kelley attempts to adopt Sam Kelly’s sufficiency of the evidence argument with
regard to the distributing and conspiracy to distribute a controlled substance counts; however, this
court has stated that “[s]ufficiency arguments . . . are too individualized to be generally adopted.”
United States v. Cooper, 203 F.3d 1279, 1285 n.4 (11th Cir. 2000). Therefore, we will not consider
any sufficiency argument on these counts as to Jason Kelley because he did not properly raise this
issue on appeal. See id. With regard to the money laundering and conspiracy to commit money
laundering counts, Sam Kelley and Jodi Silvio adopted Jason Kelley’s arguments on the sufficiency
of the evidence. The Government conceded that Sam Kelley and Silvio could adopt Jason Kelley’s
arguments on the sufficiency issue. See, e.g., United States v. Garcia, 405 F.3d 1260, 1269 n.7 (11th
Cir. 2005).
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usual course of professional practice for no legitimate medical purpose and that
each person willfully joined the plan knowing its unlawful purpose. See generally
United States v. Smith, 289 F.3d 696, 706 (11th Cir. 2002). The Government
presented testimony from businessmen, salesmen, and doctors stating that they
each developed a relationship with Applied through either Sam Kelley or Jason
Kelley in order to send prescriptions for steroids to Applied for clients who had no
medical need for them. The Government was able to show that each of the
Appellants’ actions facilitated the common goal of the steroids distribution
conspiracy. See United States v. Richardson, 532 F.3d 1279, 1284–86 (11th Cir.
2008) (holding that in order to establish a single conspiracy, the government must
demonstrate a common goal, the nature of the underlying scheme, and the overlap
of participants.). The Government also presented evidence to rebut Sam Kelley’s
defense that he was simply a detached Chief Executive Officer who did not
participate in, or have knowledge of, Applied’s illegal activities. Viewing this
evidence in the light most favorable to the Government, we affirm Sam Kelley’s
conviction on this count because a rational trier of fact could have found the
essential elements of the offense established beyond a reasonable doubt. Garcia-
Bercovich, 582 F.3d at 1237.
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The same evidence that supports a conspiracy to distribute steroids also
supports Sam Kelley’s conviction for aiding and abetting steroid distribution. In
order to determine guilt of an aiding and abetting offense, the trier of fact must
“determine whether a substantive offense was committed by someone, whether
there was an act by [Sam Kelley] which contributed to and furthered the offense,
and whether [Sam Kelley] intended to aid its commission.” United States v. Jones,
913 F.2d 1552, 1558 (11th Cir. 1990). The Government presented evidence that
Sam Kelley increased Applied’s business by providing assurances that Applied
would liberally fill steroids prescriptions, signed paychecks to salesmen who sold
steroids to many of Applied’s under age-30 customers, rewarded employees for
record sales, and made attempts to conceal from investigators Applied’s business of
dispensing large quantities of veterinary steroids that were not approved for human
use. This evidence was sufficient for a rational trier of fact to have found that the
Government established the essential elements of the offense of aiding and abetting
the distribution of steroids beyond a reasonable doubt. Garcia-Bercovich, 582 F.3d
at 1237.
ii. Promotion Money Laundering
In order to sustain a conviction for promotion money laundering, the
Government must have presented sufficient evidence that (1) Appellants
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“conducted or attempted to conduct a financial transaction;” (2) with the
knowledge that “the property involved in the transaction represented the proceeds
of unlawful activity; (3) the property involved was in fact the proceeds of the
specified unlawful activity;” and (4) the financial transactions were conducted
“with the intent to promote the carrying on of the specified unlawful activity.” 18
U.S.C. § 1956(a)(1)(A)(i); see also United States v. Calderon, 169 F.3d 718, 721
(11th Cir. 1999) (internal quotation marks omitted). The monthly dividend
payment to Applied shareholders—including between $500,000 and $1,000,000 to
Appellants—formed the basis for each substantive count charged under this statute.
Sam Kelley contends that the Government did not present sufficient evidence to
establish that the dividend payments were intended to promote Applied’s steroid
distribution activity, which generated the unlawful proceeds.
The Government presented sufficient evidence that the monthly dividend
payments were designed to give the principal players in the steroid distribution
scheme an incentive to continue their activities despite the risks inherent in such
activity. See United States v. Williamson, 339 F.3d 1295, 1301–02 (11th Cir.
2003). Contrary to Appellants’ argument, there is no requirement that the funds
were reinvested into the illegal activity from which they came. See, e.g., United
States v. Carcione, 272 F.3d 1297, 1302–03 (11th Cir. 2001). Therefore, we
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conclude that the Government presented sufficient evidence to sustain Jason Kelly,
Jodi Silvio, and Sam Kelley’s convictions for promotion money laundering.
iii. Money Laundering Conspiracy
A conspiracy count charging multiple objects will not be overturned simply
“because one of the possible bases of conviction [is] . . . unsupported by sufficient
evidence.” Griffin v. United States, 502 U.S. 46, 56, 112 S. Ct. 466, 472 (1991).
The jury returned a general verdict of guilty as to the conspiracy count, which
“stands if the evidence is sufficient with respect to any one of the acts charged.”
Id. at 56–57, 112 S. Ct. at 473. The Government presented two bases for the
conspiracy charge: the dividend payments to Sam Kelley, Jason Kelley, and Silvio;
and the commission payments to a salesman, Brett Branch, and his company,
Infinite Health. Applied paid Branch a car allowance and approximately $68,000
in commissions for steroids sales between 2005 and 2006. Additionally, Sam
Kelley and Jason Kelley wrote checks to Branch, and the prospect of earning more
commissions spurred Branch to continue participating in the scheme. This is a
legally valid basis for the conspiracy conviction, and it is supported by sufficient
evidence. We affirm Appellants’ convictions on this charge.
B. Motion for Severance
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In order for Sam Kelley to prevail upon his request for a new trial due to the
district court’s denial of his motion to sever his trial from Jason Kelley and Silvio,
he bears “the heavy burden of demonstrating the lack of a fair trial due to actual,
compelling prejudice” that is “beyond the curative powers of a cautionary
instruction.” Chavez, 584 F.3d at 1360. Sam Kelley has not sustained his burden.
Accordingly, we conclude from the record that the district court did not abuse its
discretion in denying Sam Kelly’s motion for severance.
C. Evidentiary Rulings
Appellants raise numerous allegations of evidentiary error by the district
court: the refusal to allow cross-examination of Lisa Yanoff after questioning by
the court; the refusal to allow Sam Kelley to introduce portions of recorded phone
calls or related phone calls to those introduced by the Government pursuant to
Federal Rule of Criminal Procedure 106; the preclusion of references to Kelley
Tucker’s previous criminal convictions due to the overly prejudicial nature of the
evidence; the preclusion of defense witness Steve Burkow’s testimony regarding
Applied’s practices in 2008; the exclusion of defense expert David Brushwood; the
admission of Jeffrey Weiser’s testimony regarding communications between him
and Sam Kelley; the admission of evidence of Appellant Jason Kelley’s personal
use, possession, or distribution of recreational drugs, which were controlled
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substances,2 under Rule 404(b); and the admission of testimony from Government
experts Dr. Gary Wadler and Paul Doering. We see no abuse of discretion in the
district court’s disposition of these issues; therefore, we summarily affirm the
district court’s evidentiary determinations.
Sam Kelley and Jason Kelley argue that the district court violated the
Confrontation Clause of the Constitution by allowing Agent Craig Underwood to
testify to out-of-court statements by co-defendants Robin Kelley and Mallory
Mallon—pharmacists at Applied. The Confrontation Clause “is violated when a
facially incriminating statement of a non-testifying co-defendant is offered into
evidence at a joint trial.” United States v. Taylor, 186 F.3d 1332, 1335 (11th Cir.
1999) (per curiam). The statements proffered by Agent Underwood did not directly
implicate either Sam Kelley or Jason Kelley. The statements would be
incriminating only after being linked with other evidence regarding the doctors’
prescription practices; therefore, we conclude that there was no violation of the
Confrontation Clause. See United States v. Arias, 984 F.2d 1139, 1142–43 (11th
Cir. 1993).
D. Requested Jury Instructions
2
The district court admitted the evidence of Jason Kelley’s personal recreational drug use
only as to Jason Kelley and gave a limiting instruction. On appeal, only Sam Kelley challenges the
admission of this evidence.
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Appellants allege that the district court erred by not giving the requested
good faith defense jury instruction. Appellants also contend that the district court
erred by not instructing the jury pursuant to the heightened standard for willfulness.
Because they were charged with knowingly aiding and abetting the violation of the
Controlled Substances Act through invalid prescriptions, the Appellants assert that
the district court should have used the pattern instruction that requires the
defendant to have a particularized knowledge of the law being violated.
The charge that the court gave substantially covered the good faith defense
and correctly articulated the knowledge and intent requirements for the drug
conspiracy and drug distribution counts. See United States v. Hill, 643 F.3d 807,
853 (11th Cir. 2011) (finding that the defendant’s requested instruction on good
faith was covered in the instructions on the element of the crime and the definitions
of the required state of mind). The district court’s failure to give the requested
charge did not seriously impair Appellants’ ability to present an effective defense.
Accordingly, we conclude that the district court did not abuse its discretion by
failing to give Appellants’ requested instruction that was not legally correct.
E. Prosecutor’s Challenged Remarks
In order for the prosecutor’s remarks during opening statement and closing
arguments to adversely affect the Kelleys’ substantial rights, her remarks must have
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suggested to the jury that “an uncalled witness would have corroborated another
witness’s testimony on an important point.” United States v. Hands, 184 F.3d 1322,
1333 (11th Cir. 1999). Because the prosecutor did not say what these witnesses
would have said in their testimony, the comments were not improper.
Appellants also challenge the prosecutor’s remarks in her rebuttal argument.
Her remarks, in context, did not affect the Kelleys’ substantial rights. Even if they
did, the district court sufficiently instructed the jury at the outset of the trial, during
the trial, and in its final charge that the jury was to base its verdict solely on the
evidence presented and that the lawyers’ arguments were not evidence.
Accordingly, there was no error.
F. Motions for Mistrial and a New Trial
Appellants assert that a mistrial was warranted because the prosecutor
improperly commented on Sam Kelley’s failure to testify by asking an Applied
employee whether it would be true if Sam said that he did not know what was
going on in Applied’s business. This question would infringe Sam’s rights only if it
was manifestly intended to highlight his failure to testify or if the jury necessarily
understood it to do so. United States v. Knowles, 66 F.3d 1146, 1162–63 (11th Cir.
1995). The question did neither. Nonetheless, the district court sustained Sam
Kelley’s objection to the prosecutor’s question. Appellants further contend that the
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information the Government obtained by performing a search of Applied’s
computers was not attributed to any one defendant, so it prejudiced all of them and
should not have been admitted into evidence. The district court determined that any
failure to tie specific searches to a particular defendant went to the weight of the
evidence, not its admissibility.
Additionally, Appellants take issue with the district court’s admission of Dr.
Levine’s testimony as it related to co-defendant Mallory Mallon. The testimony
was relevant and probative as to Mallon and as to the case as a whole given the
evidence on Levine’s steroids-dispensing practices. This court agrees that the
district court did not err by not giving a limiting instruction with respect to Dr.
Levine’s testimony; however, if it did err, it was harmless error in light of the
overwhelming evidence of guilt.
Lastly, Appellants argue that they are entitled to a new trial based on the
cumulative effect of trial errors. A review of the record does not reveal any errors
so there can be no cumulative effect of trial errors. Accordingly, the district court
did not abuse its discretion in denying the motion for new trial.
IV.
For the foregoing reasons, we affirm the Appellants’ convictions.
AFFIRMED.
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