United States v. Mahamed

05-6949-cr
United States v. Mahamed
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
_______________________________
August Term, 2006
(Argued: May 4, 2007 Decided: September 19, 2008)
(Petitions for Rehearing Decided: August 21, 2009)
Docket No. 05-6949-cr
Amended Opinion
_______________________________
UNITED STATES OF AMERICA,
Appellee,
v.
ABDIRASHID MOHAMED HASSAN,
Defendant-Appellant.
____________________________________
Before: CALABRESI and POOLER, Circuit Judges.*
____________________________________
Defendant-Appellant Abdirashid Mohamed Hassan appeals from the November 28, 2005
judgment of the United States District Court for the Eastern District of New York (Garaufis, J.),
convicting him, following a jury trial, of one count of conspiracy to import cathinone, in
*
The Honorable Sonia Sotomayor, originally a member of the panel that decided this
case, was elevated to the Supreme Court on August 8, 2009. The two remaining members of the
panel, who are in agreement, have determined the matter. See 28 U.S.C. § 46(d); Local Rule
0.14(2); United States v. Desimone, 140 F.3d 457 (2d Cir. 1998).
1
violation of 21 U.S.C. §§ 952(a), 963, one count of conspiracy to distribute and to possess with
intent to distribute cathinone in violation of 21 U.S.C. §§ 841(a), 846, one count of conspiracy to
launder money in violation of 18 U.S.C. § 1956(a)(1), (h), and forty-one substantive counts of
money laundering, in violation of 18 U.S.C. § 1956(a)(1). Because we conclude that the
evidence was insufficient to convict Hassan of the forty-one substantive counts of money
laundering, in violation of 18 U.S.C. § 1956(a)(1), we REVERSE the judgment on these counts,
and direct the district court to enter an order of acquittal. Because we conclude that the district
court made a fundamental error in its jury instructions, we now VACATE the judgment as to the
remaining counts. This opinion replaces in its entirety our earlier decision in United States v.
Hassan, 542 F.3d 968 (2d Cir. 2008) (“Hassan I”).
IRA M. FEINBERG, Hogan & Hartson, L.L.P., New York, NY, for
Defendant-Appellant.
MARY K. BARR, Assistant United States Attorney (Roslynn R.
Mauskopf, United States Attorney for the Eastern District of New York,
Barbara D. Underwood, Counsel to the United States Attorney, on the
brief), Brooklyn, NY, for Appellee.
_________________________________
POOLER, Circuit Judge:
Defendant-Appellant Abdirashid Mohamed Hassan appeals from the November 28, 2005
judgment of the United States District Court for the Eastern District of New York (Garaufis, J.),
convicting him, following a jury trial, of one count of conspiracy to import cathinone, in
violation of 21 U.S.C. §§ 952(a), 963, one count of conspiracy to distribute and to possess with
intent to distribute cathinone in violation of 21 U.S.C. §§ 841(a), 846, one count of conspiracy to
2
launder money in violation of 18 U.S.C. § 1956(a)(1), (h), and forty-one substantive counts of
money laundering, in violation of 18 U.S.C. § 1956(a)(1). On appeal, Hassan argues that: (1)
the district court erred in its instructions to the jury; (2) the statute and regulations governing
cathinone do not provide fair warning as to what conduct is unlawful; (3) the evidence was
insufficient to support his convictions; (4) the government’s failure to correct false and
misleading testimony denied him a fair trial; (5) trial counsel provided ineffective assistance; (6)
the district court erred in admitting a chemist’s testimony and exhibits regarding the testing of
three samples of khat; and (7) the district court’s sentencing determination was erroneous and
unreasonable. Because we conclude that the evidence was insufficient to convict Hassan of the
forty-one substantive counts of money laundering, in violation of 18 U.S.C. § 1956(a)(1), we
REVERSE the judgment on these counts, and direct the district court to enter an order of
acquittal. Because we conclude that the district court made a fundamental error in its jury
instructions, we now VACATE the judgment as to the remaining counts.1
1
As noted, this amended opinion replaces in its entirety our earlier decision in United
States v. Hassan, 542 F.3d 968 (2d Cir. 2008) (“Hassan I”), to which both parties petitioned for
rehearing. Having reviewed the petitions, we have concluded that each presents at least one valid
ground for granting rehearing and have amended the opinion accordingly. We grant Hassan’s
request that we consider the sufficiency of the evidence for the single count of money laundering
conspiracy because we agree that we are required to reach that issue since Hassan’s retrial would
be barred by Double Jeopardy if the evidence presented by the government was insufficient. See
United States v. Riggi, 541 F.3d 94, 108 (2d Cir. 2008). We conclude that the trial evidence was
sufficient to support a conviction on this count. We decline Hassan’s invitation to revisit our
conclusion that the trial evidence was sufficient to prove that he was dealing with khat containing
cathinone. We grant the government’s request that we amend the opinion’s description of the
elements of a Controlled Substances Act (“CSA”) conspiracy and have deleted that language in
Hassan I indicating that there is an overt act requirement for conspiracies charged under the
Controlled Substances Act (“CSA”). See United States v. Shabani, 513 U.S. 10, 15 (1994). We
also grant the government’s request that we amend the opinion to clarify that “scienter with
respect to the type and quantity of controlled substance is not required to convict a defendant
under the CSA,” Gov’t Pet. for Reh’g at 5-6, but make only limited amendments as we think our
3
I. BACKGROUND
A. Khat
Hassan was convicted of controlled substance and money laundering offenses involving
cathinone, a stimulant that is sometimes present in “khat.” Khat is the leaf of the plant catha
edulis, a shrub that grows in parts of East Africa and the Arabian Peninsula. See United States
Food and Drug Administration, Basis for the Recommendation for Control of Cathinone into
Schedule I of the Controlled Substance Act 9 (Nov. 5, 1992) [hereinafter “FDA Report”]; United
States v. Hassan, 03-cr-567, slip op. at 1 (E.D.N.Y. Oct. 12, 2005). “The plant’s leaves are
chewed or brewed in tea and, once ingested, produce a stimulant effect on the central nervous
system.” Id.While “khat is . . . ingested as regularly in East African countries (such as Somalia, where
the defendant is from) as coffee is ingested in the United States,” id. at 8, the two stimulants that
can sometimes be found within khat, cathinone and cathine, have nonetheless been deemed
“controlled substances” under United States law, see 21 C.F.R. §§ 1308.11(f), 1308.14(e); see
also 21 U.S.C. § 812. Cathinone, which has properties similar to those of amphetamines, is the
stronger of the two substances. It is “very unstable” and “rapidly decomposes into less potent
substances,” including cathine. See FDA Report at 9. According to the Drug Enforcement
Administration, “[w]ithin 48 hours of harvest Khat’s chemical composition breaks down and at
decision read as a whole makes clear that we adhere to that rule. However, we deny the
government’s request that we revisit our conclusion that a “conviction based on cathine, rather
than cathinone, would have been an impermissible constructive amendment of the indictment.”
Hassan I, 542 F.3d at 991. We adhere to that conclusion. See United States v. Abdulle, 564 F.3d
119, 126-27 (2d Cir. 2009) (explaining why conviction based on cathine, rather than cathinone, is
constructive amendment rather than variance). We deny the government’s and Hassan’s
petitions in all other respects.
4
that point Khat contains only Cathine, the schedule IV substance.” U.S. Drug Enforcement
Administration, Fact Sheet, Khat, AKA: Catha Edulis,
http://www.dea.gov/pubs/pressrel/pr072606a.html (last visited August 10, 2008); see also FDA
Report at 11-12 (“Khat leaves have been reported to lose their effect within . . . three days after
harvesting.”); Hassan, 03-cr-567, slip op. at 1 (“When the leaves are first cut, they contain a
stimulant called cathinone. Over a period of approximately 48-72 hours, the cathinone in the
plant degrades into cathine, a milder stimulant.”). Moreover, according to a recent article in the
Journal of Drug Issues, “[a]ny claim that khat always contains cathine is unsubstantiated.”
Edward G. Armstrong, Research Note: Crime, Chemicals, and Culture: On the Complexity of
Khat, 2008 J. Drug Issues 639. Additionally, as the Fourth Circuit has noted: “At this juncture,
there is no reasonable basis for the conclusion that khat always contains cathine.” Argaw v.
Ashcroft, 395 F.3d 521, 526 (4th Cir. 2005).
Khat itself is not a controlled substance under United States law. However, khat is
subject to an unusual and, indeed, unique dual regulatory scheme that employs a distinction
based upon the chemical composition of khat. “When khat contains cathinone, khat is a
Schedule I substance,” and “[w]hen khat does not contain cathinone, but does contain cathine,
khat is a Schedule IV substance.” Schedules of Controlled Substances: Placement of Cathinone
and 2,5-Dimethoxy-4-ethylamphetamine Into Schedule I, 58 Fed. Reg. 4316, 4317 (Jan. 14,
1993); see also United States v. Caseer, 399 F.3d 828, 833 (6th Cir. 2005) (“[N]either the U.S.
Code nor the Code of Federal Regulations controlled substances schedules refers to the plant
from which cathinone is derived, Catha edulis, commonly known as ‘khat.’”); Argaw, 395 F.3d
at 527 (“[K]hat is not a controlled substance . . . .”); United States v. Hussein, 351 F.3d 9, 17 (1st
5
Cir. 2003) (“[K]hat, unlike cocaine, is not a controlled substance per se . . . .”). Importation or
distribution of cathinone, the Schedule I substance, is subject to a maximum penalty of twenty
years, see 21 U.S.C. § 960(b)(3) (importation); 21 U.S.C. § 841(b)(1)(C) (distribution), while
importation of cathine, which was “temporarily” placed on Schedule IV in 1988,2 see 53 Fed.
Reg. 17,459 (May 17, 1988), is subject to a maximum penalty of five years, see 21 U.S.C. §
960(b)(4); see also 21 U.S.C. § 841(b)(2) (maximum penalty for possessing cathine with intent to
distribute is three years’ imprisonment).
B. Hassan’s Trial
1. The Evidence
The evidence at trial demonstrated that Hassan had been importing khat into the United
States for several years with the assistance of a United States Customs broker named Patrick
Fuller. Fuller provided Hassan with counterfeit customs stamps, which helped release goods
from United States Customs quickly and without inspection. Hassan’s khat shipments were
falsely labeled as printed matter, or similar material, and used fake return addresses. Hassan,
who was first introduced to Fuller in 1997 or 1998, was one of Fuller’s principal clients. Fuller
estimated that he helped Hassan import two to three shipments of khat per week, and Hassan
paid Fuller $1,500 for each successful shipment. Hassan also took Fuller to London and
introduced him to a man named Omar Hashi who told Fuller that he was Hassan’s khat supplier.
Fuller worked with several other khat importers, including a man named Mohamed
2
Hassan argues that cathine’s listing as a controlled substance is no longer valid because
a temporary listing cannot substitute indefinitely for the required rulemaking process. Because
Hassan was not charged with a cathine offense, we do not reach this issue.
6
Hassan -- no relation to defendant -- who cooperated with the government [hereinafter “the
cooperator”]. The cooperator testified that, like a number of other khat importers, he regularly
took waybills to Fuller to be stamped with the counterfeit customs stamps. In 2002, another khat
importer, Ahmed Mussa, introduced the cooperator to a man named Leban. The cooperator met
with Leban several times, but, ultimately, the two did not successfully negotiate a deal. The
cooperator later identified defendant Hassan as Leban in a photo array; however, when asked to
identify Leban in the courtroom during trial, the cooperator failed to identify defendant Hassan as
Leban.
Prior to his arrest in 2003, Hassan had two khat-related encounters with law enforcement
authorities. On April 4, 2001, Hassan was briefly detained at John F. Kennedy Airport (“JFK”)
when he and another individual tried to pick up two shipments of khat from a cargo facility. At
the time, Hassan told United States Customs Special Agent Paul Kastava that he thought that
khat was legal in the United States, because it was legal in Great Britain. In response, Special
Agent Kastava informed Hassan that khat is illegal in the United States.3 However, Kastava did
not inform Hassan that khat is illegal because it is, or can be, a controlled substance. Rather, he
simply told Hassan that khat is illegal.
Although the shipment of khat was seized, Hassan was not arrested. The government
argues, and the district court found, that testimony about this encounter supports the argument
that Hassan knew “that khat contains a controlled substance.” Hassan, 03-cr-567, slip. op. at 12.
Hassan, on the other hand, argues that this encounter actually supports his assertion that he was
3
Kastava thus misstated the law regarding khat to Hassan. Khat itself is not illegal,
rather, only khat containing cathinone or cathine is illegal. See supra Part I(A).
7
not aware that khat is, or can be, a controlled substance in the United States. Special Agent
Kastava did not state that khat was a controlled substance, and Hassan was not arrested, although
one would expect to be, if caught importing controlled substances into the United States by a
United States Customs Agent. Thus, Hassan argues that his encounter at JFK with Special Agent
Kastava merely proves that he was aware that importing khat violates U.S. Customs laws.
Hassan’s second encounter with law enforcement regarding khat was on May 9, 2002, at
a bond hearing for fellow khat importer Ahmed Mussa. Having been caught importing khat into
the United States, Mussa was not charged with violating United States drug laws, but rather was
charged with importing merchandise into the United States, by means of a false statement to
Customs, in violation of 18 U.S.C. § 542. Hassan, who described himself as a friend of Mussa’s
family who did not know Mussa himself, testified briefly at the hearing and co-signed a bond on
Mussa’s behalf. The bond did not identify the charges against Mussa. During the hearing, the
prosecutor and Mussa’s attorney both made reference to the fact that “the underlying conduct
here was importation of drugs” and “the underlying offense involves drugs.”
Hassan was arrested on April 16, 2003. Investigating agents from the Bureau of
Immigration and Customs Enforcement traced a United Parcel Service (“UPS”) delivery of khat
to an office building at 19 West 22nd Street in New York City (the “office building”).
Immediately after the package was delivered by the UPS driver, and signed for by co-defendant
Mahamed Mahamed (the “co-defendant”), Special Agent Stephen Lee went to the office building
and asked the co-defendant to take him to the UPS package. The co-defendant showed Special
Agent Lee the package, which had been placed on the floor of a closet adjacent to the office
building’s lobby. In response to questioning, the co-defendant told the investigating agents that
8
Hassan was responsible for arranging shipments of khat to the office building, that the co-
defendant would sign for the packages, and that the two men would split the contents. Hassan
arrived shortly thereafter and was arrested. Hassan initially told the agents that he was at the
office building to pick up a key to the co-defendant’s residence, where a sick relative was
staying. After further questioning, Hassan acknowledged that he had previously run into trouble
with U.S. Customs when he tried to pick up khat at Newark Airport.4
After he was arrested, Hassan allowed agents to search his backpack and apartment.
Among other things, the backpack contained $12,642 in cash, a UPS airway bill addressed to the
office building, and receipts for postal money orders. The backpack also contained notebooks
and date books which appeared to be records of khat transactions, listing names of couriers and
known co-conspirators, city names, and calculations. In Hassan’s apartment, investigating agents
found more money order receipts and UPS air waybills addressed to the office building, as well
as a luggage tag bearing the name and address of an individual who had been arrested three
months earlier at JFK for smuggling khat in his luggage. After Hassan’s arrest, investigating
agents obtained additional records of money orders purchased by Hassan between December 21,
1998, and May 15, 2000, payable to his khat supplier in London, Omar Hashi.
At trial, the government offered evidence attempting to connect Hassan to other
importations of khat. A customs officer testified that on June 3, 2000 he had seized khat from
the bags of Robert Lightbody, a citizen of the United Kingdom, who was attempting to enter the
United States at JFK. Customs records showed that an individual of the same name also arrived
4
As stated previously, it was actually at JFK, not Newark, that Hassan had run into
previous trouble with U.S. Customs.
9
in the United States on November 8, 1999; Lightbody’s name appeared in one of Hassan’s
calendars for that date, along with the notation “Lightbody, 400 plus 120.”
The government also presented the testimony of a Drug Enforcement Administration
(“DEA”) chemist, Brian Hall. Hall testified about analyses he performed on three packages of
khat to determine the chemical composition of the khat, i.e., whether the khat contained either
cathinone or cathine. Hall did not analyze the package of khat that was seized the day that
Hassan was arrested, and thus provided no testimony as to the chemical composition of that khat
shipment. Instead, Hall testified about three packages of khat that the DEA had seized after
Hassan was arrested. None of the packages were addressed to Hassan. However, the first
package was apparently seized at the office building. The other two packages were seized at a
UPS facility. Hall testified that each of the samples that he tested from these three packages
contained both cathinone and cathine. He also testified that cathinone, which cannot be detected
without chemical testing, begins to lose its potency within 48 to 72 hours, when it starts to break
down into cathine.
2. Procedural History
The case was tried before a jury from July 11, 2005, to July 14, 2005. On the first day of
trial, Hassan filed a motion in limine seeking to prevent the prosecution or its witnesses from
stating, inter alia, that khat is a controlled substance. The government conceded that “khat in and
of itself, without any cathinone[,] is not necessarily a controlled substance,” but pointed out that
khat “may contain” cathinone. The district court ruled that the government “would not be
permitted to introduce evidence that khat per se is a controlled substance.” Hassan, 03-cr-567,
slip. op. at 15. Nothwithstanding this restriction, a number of individuals testified throughout the
10
trial that khat is, in fact, a controlled substance. Among these were several law enforcement
personnel. Special Agent Kastava testified that to his “understanding” khat is “an illegal
substance in the United States.” Special Agent Lee testified that Hassan was arrested for
“[c]onspiracy to import khat,” answered affirmatively that khat is a “narcotic” and “is on the
controlled substance list,” and stated that “I’m familiar with khat . . . and I’m familiar that it is
illegal to bring khat into the United States.” Special Agent David Villanucci, a Special Agent
with the Immigration Customs Enforcement, testified that he arrested Hassan for “[i]mportation
of khat” and another individual for “attempting to import khat.” Ralph Cafasso, an officer with
the United States customs and border protection service, testified that khat is “an illegal
substance.”
In addition to the testimony of several law enforcement officers to the effect that khat
itself is illegal because it is a controlled substance, the customs broker Patrick Fuller also
testified to the effect that khat itself is illegal in the United States because it is a controlled
substance. He testified that he pleaded guilty to “[c]onspiracy to import khat,” that khat is “a
controlled substance, so that falls under drugs,” and that “my charges is [sic] conspiracy to
import khat.” Additionally, the cooperator indicated that he pleaded guilty to “importing
forbidden stuff to the United States.” When asked to clarify what he meant by “forbidden stuff,”
the cooperator responded, “[t]he khat.”
While Hassan’s trial counsel did not explicitly object to this testimony, he did try to
highlight the inaccurate nature of this testimony through his cross-examination. After hearing
Special Agent Lee inaccurately testify that khat is illegal in the United States because it is on the
controlled substance list, Hassan’s attorney sought to contradict Special Agent Lee’s testimony to
11
this effect by presenting the actual wording of the Controlled Substances Act to the witness.
However, after the prosecutor objected to this line of questioning, stating that it “is beyond the
scope of my direct,” the district court sustained the government’s objection. In response to the
district court’s decision to sustain the objection, Hassan’s counsel asked to “respond for the
record.” However, the district court denied this request, stating, “[w]e’ll put it on the record
later. Let’s keep going.” Later in the trial, after Fuller also testified that khat is a controlled
substance, Hassan’s counsel again tried to undermine these statements by questioning Fuller
about the chemical composition of khat. Again, the government objected to this questioning, and
the district court sustained the government’s objection.
At the close of the government’s case, Hassan moved for a judgment of acquittal under
Federal Rule of Criminal Procedure 29(a). The district court denied the motion, but deferred
consideration of Hassan’s constitutional challenge to the regulatory scheme for post-trial
briefing. Hassan rested without presenting a defense case.
At the charging conference, defense counsel objected to the following language in the
proposed jury charge for Count One:
While you must find that the defendant knew it was drugs he was conspiring to
bring into the United States, you need not find that the defendant knew or believed
that it was cathinone, as long as the government proves that he knew and intended
that some controlled substance would be imported into the United States.
Defense counsel argued that this charge was far too broad, because the government’s burden was
to prove that Hassan intended to import or distribute cathinone, and not merely khat. The court
overruled these objections, but agreed “in the interest of fairness” to change the instruction
slightly to indicate that the jury need not find that the defendant believed he was importing “a
12
drug called” cathinone. The charge as delivered also contained the following language, which
the government characterizes as a “reminder that cathinone was the controlled substance at issue
in the case”:
While you must find that the defendant knew it was a controlled substance he was
conspiring to bring into the United States, you need not find that the defendant
knew or believed that it was a drug called cathinone, as long as the government
proves that he knew and intended that some controlled substance would be
imported into the United States. As I told you earlier, cathinone is a controlled
substance.
Similar language in the charge for Count Two was not modified after trial counsel’s initial
objection. After brief deliberations, the jury found Hassan guilty on all counts.
Following his conviction, Hassan moved again for a judgment of acquittal under Rule 29
and also for a new trial under Rule 33. Fed. R. Crim. P. 29, 33. On October 12, 2005, the
district court denied these motions in a written opinion. Hassan, 03-cr-567, slip. op. at 1-18.
Relying primarily upon the First Circuit’s decision in United States v. Hussein, 351 F.3d 9, 17
(1st Cir. 2003), the district court rejected Hassan’s due process challenge to the statutory scheme,
because it found that the statutory requirements regarding specific intent mitigated any vagueness
in the regulatory scheme for khat. Hassan, 03-cr-567, slip. op. at 8-9. The district court
concluded that the government had offered sufficient evidence to satisfy the intent element,
namely: (1) Hassan “expended great effort to conceal the khat he imported into the United States
from law enforcement;” id. at 11, (2) Hassan “made efforts to import khat into the United States
as quickly as possible;” id. at 12, and (3) Hassan “was informed on two occasions that khat
contains a controlled substance,” id. Finally, the court concluded that the evidence was
sufficient to sustain the money laundering charges, because Hassan’s notebooks “recorded his
13
khat sales,” Hassan’s Social Security statements and tax returns showed that the value of the
money orders purchased exceeded his declared income, and the jury could infer that Hassan
knew “that these financial transactions involved proceeds of some form of unlawful activity”
because Hassan made “efforts to conceal his actions from law enforcement.”
In his Rule 33 motion, Hassan argued that he should be granted a new trial because the
government had repeatedly violated the court’s pre-trial ruling by referring to khat as a controlled
substance and discussing cathine. The district court rejected this argument on several grounds.
First, the district court found that the examples cited by Hassan were “not direct violations of the
in limine order.” Second, the district court concluded that, even if the order were deemed
violated, Hassan had not carried his burden, because it would not be a manifest injustice to let the
verdict stand in light of the substantial evidence of his guilt. Third, the district court found that
Hassan had “effectively waived” any objection pursuant to Rule 33, by failing to object at trial to
the relevant testimony and by failing to request a limiting instruction on this issue.
The district court sentenced Hassan to eighty-seven months’ imprisonment and three
years of supervised release on each count, to run concurrently, and imposed a special assessment
of $4,400. The court also ordered a $21,100 forfeiture.
This appeal followed. We agreed to consider the case on an expedited basis, and, in an
order filed on May 9, 2007, after oral argument, we granted Hassan’s motion for bail pending
appeal. See 18 U.S.C. § 3143(b). We now reverse the judgment of the district court as to the
forty-one substantive counts of money laundering in violation of 18 U.S.C. § 1956(a)(1) because
we find that the evidence was insufficient to sustain those convictions, and vacate the judgment
of the district court on the remaining counts, because we find that the district court made a
14
fundamental and prejudicial error in its jury instructions.
II. DISCUSSION
Almost all of the issues raised by Hassan in this appeal are intertwined in that they all
implicate scienter. Thus, while sufficiency of the evidence is a threshold issue that may obviate
other challenges, see United States v. Allen, 127 F.3d 260, 264 (2d Cir. 1997), we begin here by
addressing Hassan’s due process challenge, because we believe it helps frame the key issues
raised in Hassan’s appeal. Cf. Caseer, 399 F.3d at 832-33 (addressing vagueness first); Hussein,
351 F.3d at 13 (same).
A. Due Process Challenge
1. Standard of Review
We review de novo challenges to the constitutionality of a statute. United States v.
Giordano, 442 F.3d 30, 38-39 (2d Cir. 2006).
2. The Controlled Substance Act is Not Unconstitutionally Vague as Applied to Hassan
Hassan contends that the Controlled Substance Act (“CSA”) is unconstitutional as it
applies to khat, 21 U.S.C. § 841, because it violates the Due Process Clause of the Fifth
Amendment by failing to provide the defendant with fair warning that his conduct is unlawful.
Specifically, Hassan argues that a person of ordinary intelligence would not be able to determine
-- even upon close inspection of the relevant statute and regulations -- that the importation or
distribution of khat is unlawful, that khat may contain a controlled substance, the nature of that
controlled substance, or the seriousness of a khat-related offense. Hassan roots his argument in
15
the fact that the CSA does not explicitly mention the word “khat” while other botanical sources
are listed in the CSA; that the chemicals that are mentioned in the CSA relating to khat --
cathinone and cathine -- are obscure and unknown to the average person; and that because
cathinone rapidly deteriorates into cathine, it is impossible to know without chemical testing
whether these chemicals are present in any particular supply of khat. Furthermore, Hassan notes
that the obscurity of the CSA as it relates to khat is especially troublesome given that khat is legal
and socially accepted in a large portion of the world, including Hassan’s native Somalia, and that
its effects are that of a relatively mild stimulant similar to caffeine.
Hassan’s argument is an issue of first impression in our Circuit. The First, Sixth, and
Eighth Circuits, however, have all rejected due process challenges to the khat-related regulatory
scheme in the CSA. See Caseer, 399 F.3d at 835-39; United States v. Sheikh, 367 F.3d 756, 763-
64 (8th Cir. 2004) (relying entirely on the First Circuit’s reasoning in Hussein); Hussein, 351
F.3d at 14-16. Here, the district court, while noting the troubles associated with the vagueness of
the CSA as it relates to khat, found that the statute was constitutional because the “scienter
requirement mitigates any vagueness in the law.” Because we find persuasive the reasoning of
the district court below, and of the Sixth Circuit, we affirm the district court’s determination that
the statute is not unconstitutional under the vagueness doctrine.
The vagueness doctrine requires that, in order to be constitutional, a statute must “give
the person of ordinary intelligence a reasonable opportunity to know what is prohibited” and
“provide explicit standards for those who apply [it].” Grayned v. City of Rockford, 408 U.S.
104, 108 (1972). However, the Supreme Court has also made clear that “[w]hen the validity of
an act of the Congress is drawn in question, and even if a serious doubt of constitutionality is
16
raised, it is a cardinal principle that this Court will first ascertain whether a construction of the
statute is fairly possible by which the question may be avoided.” Crowell v. Benson, 285 U.S. 22,
62 (1932); see also Chapman v. United States, 500 U.S. 453, 464 (1991) (“Every reasonable
construction must be resorted to, in order to save a statute from unconstitutionality.” (internal
citation and quotation marks omitted)). We are thus required to find a federal statute
constitutional whenever possible.
We believe, as the district court found, that what saves the statute at issue here -- the CSA
as it relates to khat -- from constitutional trouble is the fact that scienter is required for a
conviction. See Caseer, 399 F.3d at 839; see also Vill. of Hoffman Estates v. Flipside, Hoffman
Estates, Inc., 455 U.S. 489, 499 (1982) (“[T]he Court has recognized that a scienter requirement
may mitigate a law’s vagueness, especially with respect to the adequacy of notice to the
complainant that his conduct is proscribed.”); Screws v. United States, 325 U.S. 91, 102-03
(1945) (“[W]here the punishment imposed is only for an act knowingly done with the purpose of
doing that which the statute prohibits, the accused cannot be said to suffer from lack of warning
or knowledge that the act which he does is a violation of law. . . . [A] requirement of a specific
intent . . . saves the Act from any charge of unconstitutionality on the grounds of vagueness.”).
Crimes arising out of the importation of controlled substances, and crimes for possession of
controlled substances with intent to distribute -- such as Hassan was charged with and convicted
of -- require proof that the defendant committed the offense “knowingly or intentionally.” 21
U.S.C. §§ 841(a)(1) & 960(a)(1). As the Sixth Circuit explained in Caseer, “the concern that a
person of ordinary intelligence could unwittingly expose himself or herself to criminal penalties
due to the vagueness of the controlled substances schedules with respect to khat is overcome here
17
because . . . conviction requires a showing of actual knowledge that khat contains a controlled
substance.” 399 F.3d at 839. It is this requirement of proof of specific intent for the conviction
at issue -- i.e. that the defendant “knowingly or intentionally” imported or possessed with intent
to distribute khat with a controlled substance (indeed, as we will explain, as charged in this case,
cathinone specifically) -- that persuades us that the statute governing khat is constitutional as
applied to Hassan.
Nonetheless, while we believe the statute is constitutional, we are sympathetic to
Hassan’s argument because the statutory scheme, as it relates to khat, is troubling. Here, rather
than including the words “khat”or “catha edulis” in the applicable regulations, the regulatory
scheme references only khat’s key chemical ingredients, cathine and cathinone. In contrast to the
regulatory treatment of khat, Congress did list four botanical sources -- cannabis, coca, peyote,
and poppy -- in the CSA in addition to their chemical ingredients.5 We agree with Hassan, and
the district court, that it would be helpful to people, who actually resort to statutes and
regulations to determine whether their conduct is lawful, for Congress, through the statutory or
regulatory scheme, to include the word “khat” in the CSA. However, we do not believe that
Congress was required to do so. See Hussein, 351 F.3d at 15 (“Due process does not require the
statute specifically to prohibit either ‘khat’ or ‘khat containing cathinone’ as a precondition to
5
We are aware that, similar to khat, “magic mushrooms” are not listed in the CSA while
their psychedelic ingredients, psilocybin and psilocyn, are. Thus, we agree with the First Circuit
that there is no reliable pattern here. Hussein, 351 F.3d at 16. Nonetheless, we also agree with
Judge Holschuh that: (1) “two wrongs do not make a right;” and (2) “when dealing with the
constitutional right to be fairly notified that to engage in certain conduct is a crime, [it is not] ‘a
stretch’ to believe that persons of ordinary intelligence, seeing other plants specifically listed as
being illegal but not the khat plant, could reasonably conclude that they can lawfully possess the
khat plant.” Caseer, 399 F.3d at 852 (Holschuh, J., concurring in part and dissenting in part).
18
conviction.”); see also United States v. Powell, 423 U.S. 87, 94 (1974) (“The fact that Congress
might, without difficulty, have chosen clearer and more precise language equally capable of
achieving the end which it sought does not mean that the statute which it in fact drafted is
unconstitutionally vague.” (internal quotation and citation omitted)).
As the Sixth Circuit emphasized in Caseer, while the due process challenges raised in
khat cases are unique, they nonetheless implicate serious constitutional concerns because
“[w]hen a statute is precise on its face yet latently vague, the danger of persons being caught
unaware of the criminality of their conduct is high.” 399 F.3d at 836. Moreover, while
ignorance of the law is no excuse, that principle “may be abrogated when a law is ‘so technical or
obscure that it threatens to ensnare individuals engaged in apparently innocent conduct.’” Id. at
837 (quoting United States v. Napier, 233 F.3d 394, 397-98 (6th Cir. 2000)). “Here, the term
‘cathinone’ is sufficiently obscure that persons of ordinary intelligence reading the controlled
substances schedules probably would not discern that possession of khat containing cathinone
and/or cathine constitutes possession of a controlled substance.” Id. at 838.6 Furthermore,
mainstream dictionaries provide no help, as they do not define cathinone or mention it when they
define khat. Id. (citing AMERICAN HERITAGE DICTIONARY OF THE ENGLISH LANGUAGE ,
MERRIAM -WEBSTER ’S COLLEGIATE DICTIONARY , and the OXFORD ENGLISH DICTIONARY ).
Thus, while we agree with our sister circuits that the statute withstands constitutional scrutiny
because of the scienter requirement, i.e., that the government was required to prove that
6
Testimony that occurred at trial supports this position: The cooperator (Mohamed
Hassan), a witness who had made his career in the khat trade, testified that he had never heard of
“cathinone;” and the government’s DEA chemist testified that he had never heard the term
cathinone until trained by the DEA.
19
defendant intended to import or distribute khat with a controlled substance, we share the Sixth
Circuit’s concern regarding criminal statutes that “rely on obscure technical or scientific terms
foreign to ordinary persons.” Id.
B. Sufficiency of the Evidence
Because sufficiency of the evidence is a threshold issue that may obviate other challenges,
see Allen, 127 F.3d at 264, we next examine Hassan’s contention that the evidence was
insufficient to support his convictions on the three khat-related conspiracy charges and the forty-
one substantive counts of money laundering.
1. Standard of Review
We review de novo challenges to the sufficiency of the evidence. United States v.
Rangolan, 464 F.3d 321, 324 (2d Cir. 2006). To succeed on such a challenge, Hassan must satisfy
a “heavy burden,” United States v. Santos, 449 F.3d 93, 102 (2d Cir. 2006), as we consider “only
‘whether the record evidence could reasonably support a finding of guilt beyond a reasonable
doubt,’” United States v. Rodriguez, 392 F.3d 539, 544 (2d Cir. 2004) (quoting Jackson v.
Virginia, 443 U.S. 307, 318 (1979)). We analyze the evidence in the light most favorable to the
prosecution, crediting “every inference that the jury may have drawn” in the government’s favor.
United States v. Finley, 245 F.3d 199, 202 (2d Cir. 2001) (quoting United States v. Gore, 154
F.3d 34, 40 (2d Cir. 1998)). Moreover, “the government is entitled to prove its case solely
through circumstantial evidence, provided, of course, that the government still demonstrates each
element of the charged offense beyond a reasonable doubt.” Rodriguez, 392 F.3d at 544. Thus,
we will uphold a conviction so long as “‘any rational trier of fact could have found the essential
20
elements of the crime beyond a reasonable doubt.’” Id. (quoting Jackson, 443 U.S. at 319).
Nevertheless, Hassan’s burden, while heavy, is “not an impossible one.” United States v.
Jones, 393 F.3d 107, 111 (2d Cir. 2004). “[I]f the evidence viewed in the light most favorable to
the prosecution gives equal or nearly equal circumstantial support to a theory of guilt and a theory
of innocence, then a reasonable jury must necessarily entertain a reasonable doubt.” United States
v. Glenn, 312 F.3d 58, 70 (2d Cir. 2002) (internal quotation marks omitted). After all, “‘it would
not satisfy the Constitution to have a jury determine that the defendant is probably guilty.’”
Rodriguez, 392 F.3d at 544 (quoting Sullivan v. Louisiana, 508 U.S. 275, 278 (1993) (alteration
marks omitted).
2. The Evidence was Sufficient to Convict Hassan of the Khat Conspiracy Charge
“To sustain a conspiracy conviction, the government must present some evidence from
which it can reasonably be inferred that the person charged with conspiracy knew of the existence
of the scheme alleged in the indictment and knowingly joined and participated in it.” Rodriguez,
391 F.3d at 545 (internal quotation marks omitted). The government need not show that any
controlled substance was actually imported or distributed in order to convict a defendant of
intentionally participating in the crime of conspiring to import or distribute a controlled substance.
After all, “impossibility of success is not a defense.” United States v. Jimenez Recio, 537 U.S.
270, 276 (2003) (internal quotation marks and citation omitted). The essence of the crime of
conspiracy is “the agreement to commit the crime.” Id. at 275.
As we noted earlier, khat may sometimes, but does not always, contain one or two
stimulants that are controlled substances under U.S. law: cathinone and cathine. See 21 C.F.R. §§
1308.11(f), 1308.14(e); see also 21 U.S.C. § 812. In this case, Hassan was convicted on two khat-
21
related conspiracy charges: conspiracy to import cathinone, in violation of 21 U.S.C. §§ 952(a),
963, and conspiracy to distribute and to possess with intent to distribute cathinone, in violation of
21 U.S.C. §§ 841(a), 846. The government’s evidence at trial clearly established, and Hassan
does not dispute, that Hassan knowingly conspired to import and distribute khat. Therefore,
Hassan knew of and knowingly joined and participated in the scheme alleged. The only matter in
dispute is whether the government presented evidence sufficient to demonstrate that Hassan
“knowingly engaged in the conspiracy with the specific intent to commit the offenses that were
the objects of the conspiracy.” United States v. Samaria, 239 F.3d 228, 234 (2d Cir. 2001),
abrogated on other grounds by United States v. Huezo, 546 F.3d 174, 180 n.2 (2d Cir. 2008)
(emphasis added).
That is, because “[c]onspiracy is a specific intent crime . . . [p]roof that the defendant
knew that some crime would be committed is not enough.” United States v. Morgan, 385 F.3d
196, 206 (2d Cir. 2004) (internal quotation marks and citation omitted). A conspiracy conviction
cannot be sustained unless the government established beyond a reasonable doubt that the
defendant had the specific intent to violate the substantive statute. United States v. DiTommaso,
817 F.2d 201, 218 (2d Cir. 1987). Further, if direct evidence is absent, “[c]ircumstantial evidence
of knowledge and specific intent sufficient to sustain a conviction must include some indicia of
the specific elements of the underlying crime.” Samaria, 239 F.3d at 235. Therefore, the
government could not meet its burden by offering evidence sufficient to show that Hassan
conspired to import or distribute khat; rather, the government had the burden of proving “beyond
a reasonable doubt that [Hassan] actually knew that khat contained a controlled substance.”
Caseer, 399 F.3d at 841 (emphasis added).
22
As we previously explained, khat itself is not a controlled substance. See Argaw, 395
F.3d at 527 (“Khat is not a controlled substance”); Hussein, 351 F.3d at 17 (“The government
concedes that it is not enough to show that the appellant knowingly possessed khat.”). Instead, it
is only “[w]hen khat contains cathinone, [that] khat is a Schedule I substance.” 58 Fed. Reg. at
4317 (emphasis added). Furthermore, the government concedes on appeal that it was required,
based on the indictment, to prove that Hassan knew he was dealing with khat containing
cathinone, or that substance by some other, or unknown, name. We hold the government to this
concession. Therefore, in this case, the government could not meet its burden by demonstrating
that Hassan knew he was dealing with khat containing cathine, the chemical ingredient regulated
by Schedule IV, but rather had to prove that Hassan knew he was dealing with khat containing
cathinone. Cf. United States v. Morales, 577 F.2d 769, 776 (2d Cir. 1978) (“[T]he law is settled
that a defendant need not know the exact nature of a drug in his possession to violate § 841(a)(1);
it is sufficient that he be aware that he possesses some controlled substance.”). Nonetheless,
given that we must grant every inference that the jury may have drawn in favor of the government,
we find that the government -- barely -- met its burden of providing evidence sufficient to convict
Hassan.
What differentiates this case from the khat cases that other circuits have confronted is that
there was no direct evidence that any of the khat Hassan imported actually contained a controlled
substance – cathinone, in this case. Cf. Caseer, 399 F.3d at 832; Hussein, 351 F.3d at 12. While
the government seized the khat imported by Hassan on the day of his arrest, the government failed
to offer any evidence at trial regarding the chemical analysis of this package of khat. Absent any
direct evidence of cathinone importation, the government relied on circumstantial evidence to
23
establish Hassan’s intent. See Samaria, 239 F.3d at 235. Although the government has no
obligation to establish that the conspiracy was successful, the government does bear the burden of
proving, at a minimum, that there is evidence sufficient to prove beyond a reasonable doubt that
Hassan “knew that he was dealing with a substance regulated by federal drug abuse laws,”
cathinone specifically, as charged by the indictment. Hussein, 351 F.3d at 11; Caseer, 399 F.3d at
841 (“[T]o convict [defendant] properly of the charged offenses, the district court would need to
have found beyond a reasonable doubt that [defendant] actually knew that khat contained a
controlled substance.”).7
Because of the lack of direct evidence, the government sought to prove the requisite intent
in several ways. First, the government presented testimony about Hassan’s encounter with Agent
Paul Kastava at JFK in 2001; second, it presented evidence about Hassan’s presence at a bond
hearing for Ahmed Mussa; and third, it presented evidence that Hassan tried to bring the khat into
the country expeditiously. While all of this evidence indicates that Hassan believed it was illegal
to import khat into the United States, none of it, alone, supports what is required by law, i.e., “that
the defendant knew he possessed [the] controlled substance [charged, cathinone], (even [if] he
was either mistaken about or did not know its exact identity).” Hussein, 351 F.3d at 19 (emphasis
7
“This is not to suggest that in all Controlled Substances Act prosecutions the
government must prove beyond a reasonable doubt that the defendant had actual knowledge that
the substance at issue is controlled. For substances such as cocaine that are controlled per se
under the controlled substances schedules and for which there are no due process fair-warning
concerns, constructive knowledge inferred from the listing of the substance in the controlled
substances schedules may suffice. However, when a targeted item, such as khat, is not itself
listed in the controlled substances schedules, due process requires that the government prove
beyond a reasonable doubt that the defendant had actual knowledge that the targeted item
contained a controlled substance regulated under federal drug abuse laws.” Caseer, 399 F.3d at842 n.8 (emphasis added).
24
added). Nevertheless, we are obligated to review all of the evidence collectively, not to review
each piece of evidence alone. See United States v. Autuori, 212 F.3d 105, 114 (2d Cir. 2000). It
is with this understanding that we review the evidence presented by the government.
Although neither the government nor the district court lingered on this point, we begin by
noting that Hassan’s potential awareness, from his time living in Somalia, of the stimulant effect
of khat was not enough to put him on notice that khat contained cathinone, or indeed some other
controlled substance. Contra United States v. Sheikh, 367 F.3d 756, 763 (8th Cir. 2004).
“Although actual knowledge that a substance is controlled might in some cases be inferred from
the physical effects caused by the substance, in this case the stimulant effect of khat is too mild to
permit a reasonable inference that [Hassan] knew that khat contained a controlled substance. . . .
The seeming ubiquity of coffee houses in the United States attests to the fact that consuming
products with stimulating effects is common custom in the United States, and the average
American coffee drinker most likely does not pause to consider while drinking his or her morning
‘cup of Joe’ whether he or she may be subject to criminal sanction for possession of a controlled
substance.” Caseer, 399 F.3d at 843. Thus, general knowledge of the fact that khat contains
ingredients that are stimulants is not sufficient to raise even an inference that Hassan knew that
khat contained cathinone.
We now turn to the evidence that the government argues supports the jury’s finding that
Hassan was guilty of conspiring to import and distribute cathinone. First, Hassan was present at a
bond hearing for a fellow khat importer, Ahmed Mussa. At that hearing, importation of khat was
referred to at least twice as importation of a “drug” and it was compared to marijuana for the
purposes of sentencing. Hassan participated in part of the hearing, being asked to come to the
25
front of the room to testify. A jury could reasonably conclude that he was present in the room
when khat, drugs, and marijuana were referenced. This is close to sufficient circumstantial
evidence from which a jury could rationally conclude that Hassan knew that khat contained a
controlled substance.
Second, the government argues that the speed with which Hassan attempted to bring the
khat into the United States and the fact that he hired people to help him get khat out of Customs
quickly -- using Fuller’s fraudulent stamps to secure quick release of the packages and employing
overnight delivery services -- indicate that he knew he was importing the controlled substance
cathinone. This evidence could have been construed in light of testimony that, over time,
cathinone degrades into weaker chemicals. Transport speed is therefore directly related to
cathinone’s potency, and the faster khat is shipped, the greater the probability that it will contain
cathinone when it arrives at its intended destination. Combined with proof that Hassan spent
between $3,000 and $4,500 a week to ensure that the khat was imported with sufficient speed, the
jury was free to infer that Hassan intended to deal not merely in khat, but khat with cathinone,
specifically. The impact of this cumulative evidence is weakened, however, because there is
nothing in the record with respect to how much time it actually took to ship the khat to the United
States, i.e., how much time had elapsed between the moment the khat was picked in Northeast
Africa and the time it arrived in the United States. Nevertheless, it does aid the government’s
case. Further, because Hassan’s importation methods included efforts to conceal the nature of his
packages, the shipping evidence adds to Hassan’s presence at the bond hearing to help show that
Hassan knew cathinone to be a regulated substance.
Finally, the government introduced evidence that Hassan knew khat could be seized at
26
Customs. Of course, “[n]ot all items that may be seized by the U.S. Customs Services, however,
are classified as controlled substances . . . .” Caseer, 399 F.3d at 844 (internal quotation marks
and citation omitted). Thus, while a jury could infer from Agent Kastava’s testimony that Hassan
“knew importation of khat violated U.S. customs laws,” it does not, alone, support the inference
that Hassan “knew he would be violating U.S. drug laws by importing” cathinone. Id. But it does
add something to what a jury could infer from Hassan’s presence at Mussa’s bond hearing and
from his attempted speed in bringing khat to the United States.8
All this should make clear that we have deeply serious concerns regarding the sufficiency
of the evidence in this case. We nevertheless find that the evidence -- when viewed collectively --
permits a finding of guilt. See Autuori, 212 F.3d at 114 (asserting that we must “consider the
evidence in its totality, not in isolation”); United States v. Guadagna, 183 F.3d 122, 130 (2d Cir.
1999). This is because of our exceedingly deferential standard of review: we must analyze the
evidence in the light most favorable to the prosecution, again crediting “every inference that the
8
The government also proffered “evidence” that we do not believe supports its case that
Hassan was guilty of conspiring to import and distribute a Schedule I drug. The government
presented evidence that it tested several packages of khat that were obtained after Hassan’s
arrest, and the DEA chemist testified that these packages contained both cathinone and cathine.
Assuming arguendo both that the chemist’s testimony was admissible as relevant, and that DEA
forms recording the three additional seized packages were admissible hearsay -- two assumptions
about which we have grave doubts -- this additional evidence does not help show even that
Hassan intended to import khat, nor does it support an inference that the seized packages were
connected to the charged conspiracy. The government provided no evidence, for instance, about
how these packages were addressed and labeled, from where they were mailed, how long they
were in transit, or any other information that would have provided stronger circumstantial proof
that these packages were connected to Hassan
And while Agent Kastava testified that he told Hassan that khat was illegal in the United
States -- a statement which is in fact inaccurate, as khat is only illegal when it contains a
controlled substance -- he did not testify that he told Hassan it was illegal because it could
contain controlled substances, or more importantly, for the purposes of this case, cathinone. As
such, this evidence has little use.
27
jury may have drawn” in the government’s favor. Finley, 245 F.3d at 202. We believe that when
the evidence is viewed collectively -- especially Hassan’s presence at Mussa’s bond hearing, his
efforts to avoid detection by law enforcement, and his manifest desire to speed the transit of khat
into the United States -- there is sufficient circumstantial evidence from which a jury could have
inferred the requisite scienter, i.e., that Hassan knowingly intended to import and possess with
intent to distribute khat containing cathinone.
3. The Evidence was not, However, Sufficient to Convict Hassan of the Substantive
Money Laundering Charges
Hassan was also charged with forty-one substantive counts of money laundering, in
violation of 18 U.S.C. § 1956(a)(1), based on money orders he purchased between December 21,
1998, and May 15, 2000. To sustain the substantive money laundering charges, the government
must establish that Hassan (1) knowing that the property involved in a financial transaction
represented the proceeds of some form of unlawful activity, (2) conducted or attempted to conduct
a financial transaction, (3) which in fact involved the proceeds of specified unlawful activity, (4)
either with (a) the intent to promote the carrying on of specified unlawful activity or (b) the
knowledge that the transaction was designed at least in part to conceal or disguise the nature,
location, source, ownership, or control of the proceeds of specified unlawful activity. See 18
U.S.C. § 1956(a); United States v. Gotti, 459 F.3d 296, 334 (2d Cir. 2006). The specified
unlawful activity charged was “narcotics trafficking,” in violation of 21 U.S.C. §§ 841(a)(1), 846,
and 963.
The third requirement is dispositive in this case. To sustain the substantive money
laundering charges, in stark contrast to the conspiracy charges, the government must show not
28
simply that Hassan laundered money that he believed to be the proceeds of cathinone sales, but
that the funds he laundered were in fact the proceeds of cathinone sales. As the government
conceded at oral argument, “[w]e don’t have any seizures from that time period, so there’s no
direct evidence” to show that the underlying transactions actually involved the proceeds of
cathinone trafficking. Moreover, there is no circumstantial evidence to show that Hassan actually
trafficked in cathinone during this period. Instead, the government relies on the abundant
evidence of Hassan’s khat-related activities. For instance, the government argues that the money
laundering charges are supported by the notebooks and date books Hassan kept detailing his khat
transactions. In addition, the government contends that the fact that Hassan’s declared income
was an amount far less than the value of the money orders he purchased supports an inference that
he used the proceeds of unreported khat sales to purchase the money orders. However, none of
this evidence speaks to whether Hassan actually imported cathinone during this time period.
Because cathinone can disappear from khat in a matter of days, and must be imported from the
Horn of Africa or the Arabian Peninsula, the mere presence of khat in the United States certainly
does not support an inference that cathinone is present. See United States v. Muse, No. 06-cr-600,
2007 WL 391563, at *4 (S.D.N.Y. Jan. 30, 2007); Argaw, 395 F.3d at 526 (“[W]ithout scientific
testing on a case-by-case basis, it cannot be determined when cathine or cathinone appears in
khat.”). The circumstantial evidence that the government presented does not, in any way, support
an inference that Hassan’s proceeds were the result of the specified illegal activity, i.e., the
importation of cathinone. Thus, the substantive money laundering charges cannot be sustained.
We therefore reverse the judgment of the district court, and the case is remanded with instructions
to enter a judgment of acquittal on all forty-one substantive counts of money laundering, in
29
violation of 18 U.S.C. § 1956(a)(1).
4. The Evidence was Sufficient to Convict Hassan of Conspiring to Launder Money.
Hassan was also charged with one count of conspiracy to launder money, in violation of 18
U.S.C. § 1956(h). “In order to establish that a defendant conspired to launder monetary
instruments in violation of 18 U.S.C. § 1956(h), the government must show that the defendant
agreed to: 1) conduct a financial transaction; 2) involving the proceeds of specified unlawful
activity; 3) knowing that the property involved in the transaction represented the proceeds of some
form of unlawful activity; and 4) knowing that the financial transaction was designed in whole or
in part to conceal or disguise the nature, source, location, ownership, or control of those
proceeds.” United States v. Henry, 325 F.3d 93, 103 (2d Cir. 2003).
The evidence presented at trial was sufficient to sustain a conviction on this count, which
charged Hassan with conspiring to launder money “between December 1998 and April 2003.” [A
36] The money orders, unreported income, date books, and notebooks allowed the jury to infer
that Hassan agreed to conduct various financial transactions, knowing that the transactions were
structured to disguise the nature and source of the funds involved. Having found the evidence
sufficient to convict Hassan of the cathinone conspiracy charges, the jury could have easily
inferred that Hassan believed that the funds related to cathinone trafficking. Because the
government presented money orders purchased by Hassan in November 2002, after his
participation in the bond hearing and following his encounter with Agent Kastava, the jury was
able to also conclude that Hassan knew cathinone was a regulated substance during the period
charged in the indictment. However, as we explain below, we believe there was a fundamental
and prejudicial error in the district court’s instructions to the jury on scienter. Because we fear
30
that this error may have affected the jury’s determination on this issue, we vacate the judgment of
the district court, and remand for a retrial on the one count of conspiracy to launder money, in
violation of 18 U.S.C. § 1956(h). For the same reasons, discussed in further detail below, we also
vacate the judgments on the one count of conspiracy to import cathinone, in violation of 21 U.S.C.
§§ 952(a), 963, and the one count of conspiracy to distribute and to possess with intent to
distribute cathinone, in violation of 21 U.S.C. §§ 841(a), 846.
C. Erroneous Jury Instructions
1. Standard of Review
We review de novo a claim of error in jury instructions, “reversing only where, viewing
the charge as a whole, there was a prejudicial error.” United States v. Aina-Marshall, 336 F.3d
167, 170 (2d Cir. 2003). However, the government contends that here de novo review is not
appropriate. Rather, the government asserts that a plain error standard applies, because Hassan
failed to present his challenge to the charge on intent to the district court. See, e.g., United States
v. Miller, 116 F.3d 641, 672 (2d Cir. 1997). We disagree, and instead find that de novo review is
appropriate.
The government’s claim sweeps too broadly. At the charging conference, defense counsel
clearly raised an objection to the jury instructions that dealt with precisely the issues now before
us. With respect to Count One, importation, defense counsel stated:
The only controlled substance involved in this case is cathinone. If it’s not
cathinone, we’ve stipulated cathine could not be regarded, khat is not a controlled
substance. I don’t know--they can’t argue heroin or cocaine. There is no
evidence of anything other than cathinone. This . . . broadens it so wide.
. . . I just think the sentence should be deleted.
31
. . . The officer sat on the stand, testified that khat was a controlled substance.
. . . The chemist witness went further, he even said cathine, I found cathine, and
it’s on schedule four. . . . What if the jury heard that and they say oh that cathine
business, it might have been cathine.
Hassan’s trial counsel thus made clear that he believed that portions of the jury charge should be
stricken so as to assure that the jury did not convict Hassan, improperly, on the basis of his
conspiring to import “some controlled substance” other than cathinone. Although Hassan did not
explicitly reiterate his objection to the jury instruction relating to Count II, the same charging
language was at issue in both drug counts. There was no reason for Hassan to limit his challenge
to Count I, nor for the court to believe he was doing so. It is true that, as the government argues,
if Hassan had specifically objected to the charge for Count II, the court may have made the same
modifications to the scienter instruction as it did for Count I. However, that is immaterial on this
appeal, because Hassan is arguing that -- even as modified -- the charge for Count I was
erroneous.
The government also claims that the arguments being raised on appeal are not preserved
because trial counsel, after objecting to the jury instructions, failed to propose alternative
language. This argument also fails. Rule 30(d) requires only that a party “inform the court of the
specific objection,” Fed. R. Crim. P. 30(d), and does not require that a party propose alternate
language in order to preserve a challenge for appeal. As the cited portion of counsel’s statements
indicates, the substance of the claim now being raised on appeal was squarely raised below:
counsel made it clear to the trial court that he objected to the charge because he believed it
permitted the jury to convict Hassan based on a finding that Hassan intended to import and
distribute khat or khat containing cathine. Cf. United States v. Masotto, 73 F.3d 1233, 1237-38
32
(2d Cir. 1996) (concluding that specific objection was preserved so long as counsel’s arguments
were “sufficient to direct the district court to his contention,” even if counsel failed to mention the
specific language he was requesting); see also 2A Charles A. Wright et al., Federal Practice &
Procedure § 484 (3d ed. 2000) (“A party may object to an instruction given by the court although
it has not requested an instruction of its own on the point.”); United States v. English, 409 F.2d
200, 201 (3d Cir. 1969) (“[W]e note that counsel’s exception to the charge, although no requests
for charge were submitted, was sufficient to preserve the error for assignment on appeal.”). Thus,
we review de novo Hassan’s claim that there was prejudicial error in the jury instructions.
2. The District Court Made a Fundamental Error in its Jury Instructions
“A jury instruction is erroneous if it misleads the jury as to the correct legal standard or
does not adequately inform the jury on the law.” Anderson v. Branen, 17 F.3d 552, 556 (2d Cir.
1994). Therefore, “[a]n erroneous instruction, unless harmless, requires a new trial.” Id. “An
error is harmless only if it is clear beyond a reasonable doubt that a rational jury would have found
the defendant guilty absent the error.” United States v. Quattrone, 441 F.3d 153, 177 (2d Cir.
2006) (quoting United States v. Carr, 424 F.3d 213, 218 (2d Cir. 2005) (internal quotation marks
omitted)).
We begin by noting that, in this case, the instruction to the jury on the requirement of
intent is critical for two reasons. First, as noted above, scienter is what preserves the relevant
statutory and regulatory scheme from a successful due process challenge. Second, Hassan has
been charged only with conspiracy, and thus the government does not need to prove that Hassan
ever actually imported or possessed cathinone with intent to distribute, but only that he intended
to do so. See United States v. Morgan, 385 F.3d 196, 206 (2d Cir. 2004) (“Conspiracy is a
33
specific intent crime . . . .”); United States v. Soto, 716 F.2d 989, 993 (2d Cir. 1983) (stating that
the government must “establish[] beyond a reasonable doubt that the defendant had the specific
intent to violate the substantive statute[s]” charged as the object of the conspiracy (citation
omitted)). In a conspiracy case, “[p]roof that the defendant knew that some crime would be
committed is not enough.” Morgan, 385 F.3d at 206 (citation omitted).
Count One charged Hassan with conspiring to import cathinone, a Schedule I controlled
substance, in violation of 21 U.S.C. §§ 952(a), 963. As to Count One, the district court instructed
the jury that in order to convict Hassan, the jury “must find that the defendant knew it was a
controlled substance he was conspiring to bring into the United States,” and explained that the
jury “need not find that the defendant knew or believed that it was a drug called cathinone, as long
as the government proves that he knew and intended that some controlled substance would be
imported into the United States.” Count Two charged Hassan with conspiring to possess with
intent to distribute cathinone in violation of 21 U.S.C. §§ 841(a)(1), 846. As to Count Two, the
district court instructed the jury that, in order to convict Hassan, the jury had to find that Hassan
“acted with the specific intent of possessing the controlled substance,” and explained that “[t]he
government need not, however, prove that the defendant knew the exact nature of the controlled
substance in his possession. It is enough that the government proves that the defendant knew that
he possessed some kind of a controlled substance.”
Hassan argues that the charges to the jury on the conspiracies to import and distribute
cathinone were erroneous and not accurate explanations of the law, because they left open the
possibility that the jury could convict Hassan on an improper basis -- either on the basis that he
intended to import and distribute khat (which is not a controlled substance) or on the basis that he
34
imported or distributed cathine (which, as the government has acknowledged, was not the
controlled substance which Hassan was charged with possessing in the indictment). Hassan
points out that the district court did not explain to the jury that khat itself is not a controlled
substance, or that defendant’s intent to import or possess khat could not be the basis for his
conviction without proof that he intended to import or possess khat with cathinone. Furthermore,
the district court did not explain to the jury that cathine is a different, and less serious controlled
substance, and could not be the basis for Hassan’s conviction of the crimes charged in the
indictment.
Hassan contends that the problems with the jury instructions are of particular import,
because at trial, government witnesses repeatedly suggested -- incorrectly, and without correction
by the court -- that khat itself is a controlled substance. Because khat is not, per se, a controlled
substance, the district court ruled before trial that the “[g]overnment would not be permitted to
introduce evidence that khat is per se a controlled substance.” Nonetheless, at trial numerous
government witnesses suggested that khat was in fact a controlled substance. For example,
Special Agent Kastava testified that khat is “an illegal substance in the United States,” Special
Agent Lee testified that khat is a “narcotic” and “is on the controlled substance list,” Special
Agent Villanucci testified that he arrested Hassan for “[i]mportation of khat” and arrested another
individual earlier for “attempting to import khat,” Fuller testified that he pled guilty to
“[c]onspiracy to import khat,” and that khat is “a controlled substance,” and Mohamed Hassan
testified that he pled guilty to importing “forbidden stuff . . . [t]he khat.”9 Furthermore, a
9
Defense counsel actually highlighted some of this testimony when objecting to the jury
instructions, but the judge indicated that a law enforcement officer’s testimony that khat was a
controlled substance was a matter “for the jury.” We are troubled by this comment; regardless of
35
government witness also discussed the illegality of khat with cathine. Specifically, the DEA
chemist testified that khat may contain cathine, that cathine is a Schedule IV controlled substance,
and that the khat tested in connection with this case in fact contained both cathine and cathinone.
Despite this repeated testimony, the district court did not clarify to the jury that Hassan was
charged with importing or possessing khat with cathinone, not khat, nor khat with cathine. Thus,
Hassan argues that these statements by witnesses, combined with the jury instructions, allowed the
jury to believe that it could convict Hassan because he intended to import and possess khat, or
intended to import and possess khat with cathine.
The government makes a number of arguments concerning the evidence in this case. First,
the government argues that Hassan misreads the jury instructions, taking one sentence out of
context, and that a review of the entire charge shows that Hassan’s argument has no merit. While
the government concedes that witnesses testified that khat is an unlawful controlled substance, it
nonetheless dismisses this testimony as “not literally false” given the fact that khat is a controlled
substance when it contains either cathinone or cathine, like the khat at issue. But cf. Argaw, 395
F.3d at 527 (“[k]hat is not a controlled substance”); Hussein, 351 F.3d at 17 (“But khat, unlike
cocaine, is not a controlled substance per se, and the government concedes that it is not enough to
show that the appellant knowingly possessed khat.”); 58 Fed. Reg. at 4317 (“When khat contains
cathinone, khat is a Schedule I substance;” and “[w]hen khat does not contain cathinone, but does
contain cathine, khat is a Schedule IV substance.”). The government also claims that the DEA
chemist corrected any such misconception by testifying “unequivocally” that khat was not on the
how the legal status of khat is characterized, it is a legal issue for the judge to decide, and clarify
for the jury, not a question of fact reserved for the jury.
36
controlled substances list. We disagree with the government’s characterization of this testimony;
to the contrary, we believe that Hall’s testimony was clearly equivocal. When asked whether
khat, the plant, was on the controlled substance list, he replied, “No, it’s not. Not that I know of.”
Moreover, the jury was still free to weigh Hall’s testimony against the misleading testimony of the
other government witnesses, including law enforcement officers, and could have reasonably
reached the conclusion that khat was, in fact, a controlled substance.
But the question before us is not, as the government suggests, whether this trial testimony
was literally false, but rather whether, in light of the testimony, the judge’s instructions failed to
present the jury with a correct explanation of the law. The government argues that Hassan takes a
single sentence in the jury instructions out of context and that the charge as a whole properly
instructed the jury that an element of each charged crime was the intent to import or possess the
controlled substance cathinone, regardless of whether Hassan knew the substance by name. The
government is correct that references to cathinone appear frequently in the jury instructions:
[Reading from the indictment:] “Count One: Conspiracy to Import Cathinone. . . .
[defendant] did knowingly and intentionally conspire to import into the United
States . . . a substance containing cathinone.
“I instruct you that cathinone is a controlled substance under the law and for the
purposes of these statutes.”
“Before you may convict the defendant of conspiracy to import cathinone as
charged in the indictment, the government must establish each of the following
elements beyond a reasonable doubt.”
“[Y]ou need not find that the defendant knew or believed that it was a drug called
cathinone, as long as the government proves that he knew and intended that some
controlled substance would be imported into the United States. As I told you
earlier, cathinone is a controlled substance.”
[From the indictment:] “Count Two: Conspiracy to Possess with Intent to
Distribute Cathinone. . . . [defendant] did knowingly and intentionally conspire to
distribute and possess with intent to distribute a controlled substance, which
offense involved a substance containing cathinone . . . .”
“I have already instructed you that cathinone is a controlled substance under the
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law.”
“[Y]our decision as to whether the defendant conspired to commit a particular
unlawful act, either distribution of cathinone or possession with intent to
distribute cathinone, must be unanimous.”
“The elements of possession with intent to distribute are: First, that the defendant
possessed cathinone; Second, that the defendant knew that he possessed a
controlled substance; and Third, that the defendant possessed cathinone with
intent to distribute it.”
“The elements of the crime of distribution of cathinone are: First, that the
defendant distributed cathinone; Second, that the defendant distributed the
cathinone knowingly.”
Moreover, cathinone is the only controlled substance identified in the jury instructions.
The government therefore argues that the purpose and the effect of the jury instruction was
to inform the jury that Hassan need not know that the controlled substance at issue was named
cathinone, so long as Hassan realized it was a controlled substance. While we agree that this was
likely the district court’s purpose in stating the jury instructions as it did, we disagree with the
government as to the effect that the instructions may have had. We emphasize, again, that in this
case the scienter requirement is what prevents the entire regulatory scheme, as it relates to khat,
from being unconstitutional. Therefore, we must scrutinize the instructions regarding scienter,
and the context in which they were given, very closely. Here, we believe that the jury instructions
failed to correctly inform the jury that a bare intent to import or possess khat, or khat with cathine,
would not be sufficient to sustain Hassan’s conviction. Instead, in light of the evidence presented
to the jury throughout the trial, the jury may have very well convicted Hassan on the erroneous
belief that khat is a controlled substance, or on the basis of a belief that Hassan must have known,
at a minimum, that he was importing with intent to distribute cathine. We therefore find that there
was a fundamental error in the jury instructions. Furthermore, given how close we believe the
sufficiency of the evidence was in this case, and the essential role that the scienter requirement
38
played in our due process analysis, this error was not harmless.
We are also unpersuaded by the government’s remaining arguments. First, the
government argues that the charge as a whole was adequate because cathinone was the only
substance identified as a controlled substance in the jury charge. While this is so, as we explained
above in detail, the jury also heard inaccurate testimony to the effect that khat is illegal, along
with accurate testimony that cathine is also illegal. The district court’s jury instruction thus left
open the possibility that the jury would convict on one of these alternative bases. Second, the
government argues that it is inconceivable that Hassan intended to import anything other than
cathinone in light of his overnight delivery methods. This is obviously not true. Hassan’s
customers may have preferred fresh khat containing cathine, or simply fresh khat containing no
controlled substances. Despite the expedited means of delivery, there was absolutely no evidence
in the record of when the khat arrived, much less that it arrived in the United States within 48-72
hours of it being cut. See U.S. Drug Enforcement Administration, Fact Sheet, Khat, AKA: Catha
Edulis, http://www.dea.gov/pubs/pressrel/pr072606a.html (last visited Aug. 10, 2008)(stating that
“[c]athinone . . . dissipates within 48 hours of harvest”); FDA Report 11-12 (stating that khat
leaves have been reported to lose their effect within three days of harvesting).
Finally, and perhaps most troubling, the government cites our decision in United States v.
Morales, 577 F.2d 769, 776 (2d Cir. 1978), to argue that Hassan could have been lawfully
convicted by the jury even if the jury found that he intended to import an illegal substance with
cathine, and not an illegal substance with cathinone. First, as stated previously, we believe the
jury instructions, in light of testimony at trial, created a real possibility that the jury may have
convicted Hassan on the erroneous belief that khat, itself, was a controlled substance, and
39
therefore this argument is unpersuasive. Second, the government conceded at trial that it was not
trying an “any” controlled substance charge, but rather, was limiting itself to trying a cathinone-
related charge, as listed in the indictment. Moreover, the government’s attempt to use Morales to
argue that any error in the jury instructions was harmless runs squarely into Hassan’s constructive
amendment claim. A conviction based on cathine, rather than cathinone, would have been an
impermissible constructive amendment of the indictment. See United States v. Wozniak, 126
F.3d 105 (2d Cir. 1997) (holding that an instruction permitting the jury to convict on the basis of
marijuana transactions, when indictment alleged only cocaine and methamphetamine transactions,
was an impermissible constructive amendment of the indictment). Under Morales, the
government could have charged this case as one involving either cathinone or cathine, or both.
However, the government made the deliberate choice to indict Hassan with conspiring to import
and possess cathinone; we assume, because it wanted to invoke the harsh penalties applicable to a
Schedule I controlled substance.
By making this charging decision, Hassan’s alleged intent to import and possess this
Schedule I substance was critical to a conviction. See Wozniak, 126 F.3d at 109. “[A] defendant
has the right to be tried only on charges contained in an indictment returned by a grand jury. An
unconstitutional amendment of the indictment occurs when the charging terms are altered, either
literally or constructively.” Id. (internal quotation marks and citation omitted). Constructive
amendments are “per se violation[s] of the Grand Jury Clause of the Fifth Amendment that
require[] reversal even without a showing of prejudice to the defendant.” Id. (internal quotation
marks and citation omitted). Hassan’s intent was an essential element of the offense, and an
impermissible constructive amendment of the indictment occurs if the impermissible alteration
40
“affect[s] an essential element of the offense.” United States v. Patino, 962 F.2d 263, 266 (2d Cir.
1992). The jury charge, which completely failed to explain the unique regulatory scheme, and
allowed the jury to convict if Hassan conspired to import or distribute “some controlled
substance,” simply does not satisfy the burden assumed by the government in this case.
Therefore, we vacate the judgment, and remand for a new trial.
We understand that the khat-related regulatory scheme poses unique and complicated
issues for the government, defendants, and district courts. We are not unsympathetic to those
problems. In this case, however, given the terms of the indictment, the misleading evidence
allowed at trial concerning the illegality of khat, and the potentially confusing evidence
concerning cathine, the jury instructions were clearly erroneous. Furthermore, the jury
instructions were not harmless. Under the circumstances of this case, to be valid, the jury charge
needed to explain explicitly to the jury that (1) khat itself is not a controlled substance and Hassan
cannot be convicted simply for intending to import or possess with intent to distribute khat; (2) if
the jury found that Hassan had the intent to import and possess khat with cathine, that too would
not be sufficient to convict Hassan; and (3) that the government is bound by the scienter burden it
assumes in the crimes it charges -- the government was required to prove here that Hassan had the
intent to import and possess khat with cathinone.
D. Remaining Claims
We are reversing and ordering an entry of acquittal on forty-one of Hassan’s substantive
money laundering charges, and vacating and remanding to the district court for retrial on all
remaining charges. Therefore, we need not consider Hassan’s remaining arguments that he was
41
denied a fair trial because the government failed to correct false and misleading testimony, his
trial counsel was ineffective, the district court erred in admitting the DEA chemist’s testimony
and the exhibits regarding the testing of three samples of khat, and that his sentence was
erroneous and unreasonable.
III. CONCLUSION
Because we conclude that the evidence was insufficient to convict Hassan of the forty-one
substantive counts of money laundering, in violation of 18 U.S.C. § 1956(a)(1), we REVERSE the
judgment on these counts, and direct the district court to enter an order of acquittal. Because we
believe there was a fundamental error in the jury instructions that was not harmless, we VACATE
Hassan’s conviction on the remaining counts and remand to the district court for retrial, if the
government should wish to pursue the matter.
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