United States v. Ghali

United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
June 7, 2006
FOR THE FIFTH CIRCUIT
Charles R. Fulbruge III
Clerk
No. 05-10250
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
MOHAMMED KHALIL GHALI
Defendant-Appellant.
Appeal from the United States District Court
for the Northern District of Texas
Before GARWOOD, HIGGINBOTHAM and CLEMENT, Circuit Judges.
GARWOOD, Circuit Judge:*
Mohammed Khalil Ghali appeals his bench-trial conviction on
fifteen counts of a nineteen-count indictment, arguing that the
district court erred by denying his motion to suppress evidence and
also that the evidence was insufficient to support his conviction
on counts ten through eighteen, the “money laundering–sting” counts
*
Pursuant to 5TH CIR. R. 47.5 the Court has determined that this opinion
should not be published and is not precedent except under the limited
circumstances set forth in 5TH CIR. R. 47.5.4.
(18 U.S.C. § 1956(a)(3)(A)),1 because it did not show he was
expressly informed the goods in question were stolen. Ghali also
appeals his sentence, arguing that the district court erred by
applying sentence enhancements for the use of a minor to commit an
offense and for obstruction of justice. We hold that the district
court properly denied the motion to suppress evidence, we reject
Ghali’s contentions as to the sufficiency of the evidence, and we
conclude that the district court did not err in applying the
challenged sentence enhancements. Accordingly, we affirm.
Facts and Proceedings Below
Mohammed Khalil Ghali (Ghali)2 owned and operated Sunshine
Market, a convenience store in Arlington, Texas, and Sunshine
Wholesale, a wholesale business in a warehouse in Grand Prairie,
Texas.3 Ghali also owned A-1 Market, another convenience store in
Arlington, Texas. The government suspected that Ghali, through his
convenience stores and wholesale business, was buying and reselling
stolen goods. Beginning September 12, 2001, the Ghali organization
was investigated by a federal task force consisting of
1
In this opinion, we adopt the indictment’s description of a violation of
18 U.S.C. § 1956(a)(3)(A) — “money laundering–sting.” Section 1956(a)(3)(A)
criminalizes conducting a financial transaction involving property that is
represented by federal law enforcement agents to be the proceeds of specified
unlawful activity.
2
Of the Ghali family members mentioned in this opinion, only Mohammed Ghali
will be referred to simply as “Ghali.” All others will be referred to by their
full name or by their first name.
3
The record shows that Stephanie Ghali (Stephanie), the second wife of
Ghali, was the record owner of Sunshine Market and Sunshine Wholesale.
Regardless, Mohammed Ghali effectively owned and controlled these businesses.
2
representatives from the FBI, the U.S. Food and Drug
Administration’s Office of Criminal Investigations, the Internal
Revenue Service’s Criminal Investigation Division, the U.S. Customs
Service, and the Fort Worth Police Department. The task force’s
investigation continued until Ghali’s arrest on May 21, 2003.
The investigation included a sting operation using
confidential informants as well as an undercover officer. During
the course of the sting operation, Ghali’s organization paid
approximately $230,000 for property that was represented by task
force agents to have been stolen in Oklahoma and then brought from
Oklahoma to Texas for sale.4 There were numerous transactions in
which somebody in the Ghali organization, although never Ghali in
person, purchased property thus represented as stolen. Nine of
these transactions, occurring from November 2002 to May 2003,
involved property valued at more than $5,000, which led to the nine
counts of money laundering–sting. Although Ghali did not
personally make the payments in these nine transactions, the
government connected Ghali to the approval of each charged
transaction through recorded phone calls. On May 14, 2003, after
one of the largest of these transactions, Ghali instructed his
brother Luai Ghali (Luai) to use Ghali’s minor son Amir to help
move the property represented to be stolen into a storage facility.
4
It appears that in most of these transactions the representation to the
Ghali organization was that the seller had purchased the property in Texas from
the thief (or another party) who had brought it from Oklahoma.
3
Amir did in fact help Luai store 936 cases of infant formula and
712 cartons of cigarettes.
The federal task force’s investigation also included the
inspection of outbound shipments from Sunshine Wholesale to various
entities via Federal Express (FedEx). The first of these searches,
all of which were conducted without a warrant, occurred on May 6,
2002, after FedEx employees in Irving noticed that a shipment of
infant formula from Sunshine Wholesale in Grand Prairie, Texas, to
United Trading in Lexington, Kentucky, was mislabeled as baby
products.5 A federal task force officer had previously alerted
FedEx to be on the lookout for suspicious shipments of infant
formula, and so this shipment was brought to the attention of the
federal task force, which then searched the shipment and found cans
of infant formula that had previously been represented as stolen.
After this, the FedEx employees in Irving contacted a member of the
federal task force every time that Sunshine Wholesale made a
shipment, or received an interstate shipment, via FedEx. In
response to these contacts, a member of the task force would go to
the FedEx warehouse to search the shipment.
Although the record indicates that the task force made
numerous warrantless searches of Sunshine Wholesale’s FedEx
shipments, only the evidence from certain of these searches was
5
According to the unchallenged testimony of a FedEx witness, a shipment of
baby products can be shipped in the same trailer as hazardous material, but a
shipment of food products, such as infant formula, cannot.
4
introduced in the guilt-innocence phase of the trial.
Specifically, the introduced evidence was obtained in January,
February, and March of 2003 from the searches of FedEx shipments
from Sunshine Wholesale to Power Supply, a company in Florida owned
by the family of Mirco Vietti (Vietti). Prior to these particular
searches, the federal task force had obtained the full cooperation
of Vietti in support of its investigation of the Ghali
organization.
Ghali moved to suppress the evidence obtained during the task
force’s warrantless searches, arguing that the searches were
unconstitutional. Following a pre-trial suppression hearing, the
district court denied the motion to suppress after finding that,
due to Vietti’s close cooperation, the evidence from the shipments
to Power Supply inevitably would have been discovered. The
district court alternatively found that Vietti had impliedly
consented to the government’s warrantless searches at FedEx.
Following a bench trial, Ghali was convicted of one count of
conspiring to commit offenses against the United States (18 U.S.C.
§ 371), one count of possessing goods stolen from an interstate
shipment (§ 659), three counts of transporting stolen property in
interstate commerce (§ 2314), nine counts of money laundering–sting
(§ 1956(a)(3)(A)), and one count of conspiring to commit a money-
laundering offense (§ 1956(h)). At sentencing, post-Booker, the
district court determined the advisory guideline range by applying
5
the following offense-level enhancements: fourteen levels for a
loss amount of $528,627 (U.S.S.G. § 2B1.1(b)(1)(H)); two levels for
receiving and selling stolen property (§ 2B1.1(b)(4)); two levels
for a conviction under § 1956 (§ 2S1.1(b)(2)(B)); four levels for
being an organizer or leader (§ 3B1.1(a)); two levels for using a
minor to commit a crime (§ 3B1.4); and two levels for obstruction
of justice (§ 3C1.1). The court sentenced Ghali to 168 months’
imprisonment (stating that “[t]his consists of” concurrent terms of
60 months on count 1, 120 months on each of counts 6-9, and 168
months on each of counts 10-19) followed by concurrent three year
terms of supervised release on each such count and a $1500 special
assessment ($100 for each of the counts of conviction). Certain
forfeitures were also ordered.
Discussion
A. The motion to suppress evidence
Reviewing a district court’s ruling on a motion to suppress,
this court accepts the district court’s factual findings “unless
clearly erroneous or influenced by an incorrect view of the law.”
United States v. Alvarez, 6 F.3d 287, 289 (5th Cir. 1993). The
district court’s conclusions of law are reviewed de novo. Id. “In
reviewing a ruling on a motion to suppress, this Court views the
evidence taken at trial as well as the evidence taken at the
suppression hearing.” Id. (citing United States v. Rideau, 969
F.2d 1572 (5th Cir. 1992) (en banc)).
6
Ghali moved to suppress all evidence seized without a warrant
from the shipments of Sunshine Wholesale.6 Following the
suppression hearing, the district court denied the motion to
suppress because the evidence inevitably would have been
discovered, and also because the addressee, Mirco Vietti, had
impliedly consented to the searches. While the district court
orally denied the motion to suppress prior to commencement of the
trial, it also informed the parties that it would issue a written
opinion and order, which it did on April 2, 2004, after the
conclusion of the trial.
In analyzing whether the inevitable-discovery exception
applied to the exclusionary rule, the district court relied on the
legal standard from our decision in United States v. Cherry, 759
F.2d 1196 (5th Cir. 1985): “In order for the [inevitable-discovery]
exception to apply, the prosecution must demonstrate both a
reasonable probability that the evidence would have been discovered
in the absence of police misconduct and that the government was
actively pursuing a substantial alternate line of investigation at
the time of the constitutional violation.” Id. at 1205–06. The
prosecution must make this demonstration by a preponderance of the
evidence. Nix v. Williams, 104 S.Ct. 2501, 2509 (1984).
6
Specifically, Ghali’s motion addressed the following: “Evidence seized
without a warrant on February 11th and 28th, and March 24th, 2003, and other
times unknown from Federal Express Co., the United States Mail, and other
carriers by ‘ICE agents’ Ft. Worth Police, Customs, Immigration and the Dept. Of
‘Homeland Security’.”
7
In its opinion, the district court noted that Ghali’s motion
to suppress was directed to the warrantless searches conducted in
early 2003 of Sunshine Wholesale’s FedEx shipments to Mirco
Vietti’s company, Power Supply. Based on evidence that the
government was actively pursuing a substantial alternate line of
investigation through Vietti in Florida, and based on evidence of
Vietti’s full cooperation with the government, the district court
found that the government had met its burden to establish that the
evidence from the shipment to Vietti inevitably would have been
discovered. Based on our review of the record, the district
court’s findings were neither clearly erroneous nor the result of
an incorrect view of the law.
Ghali’s appeal on this issue does not seriously challenge the
district court’s finding that the evidence obtained from the
warrantless search of the FedEx shipments to Vietti inevitably
would have been discovered. Instead, Ghali argues that the trial
court erred by focusing only on the FedEx shipments to Vietti.
Ghali conclusorily states, “It is undisputed that the Government
introduced evidence, not only coming from Vietti in Florida, but
from the Shallash family in Kentucky and others in an effort to
convince the court that everything Appellant did with connection to
Sunshine Wholesale was tainted by stolen property.” Ghali argues
that evidence from warrantless searches of Sunshine Wholesale’s
FedEx shipments to other customers should not have been admitted
because Vietti’s cooperation had nothing to do with the search of
8
those shipments. However, contrary to Ghali’s assertions, none of
the evidence from the other warrantless searches was admitted
during the guilt-innocence phase of the trial.
Ghali has pointed to no evidence that was admitted during the
trial that was obtained during a warrantless search of a FedEx
shipment that was not going to Vietti’s company. The only specific
evidence that Ghali has come close to complaining of is the May 6,
2002 FedEx shipment of infant formula from Sunshine Wholesale to
United Trading, which was owned by “the Shallash family in
Kentucky.” After reviewing the record, however, we agree with the
government that the evidence from the May 6, 2002 shipment was not
introduced during the trial, although it was properly introduced
during the suppression hearing. While Ghali speaks vaguely of
evidence from other searches, he has not shown that any such
evidence was admitted, nor has he argued that the evidence that was
admitted was obtained from illegal searches (other than those in
2003 of shipments to Vietti’s company).7 In summary, because the
7
At oral argument, Ghali’s counsel contended that he did indeed make a
“fruit of the poisonous tree” argument by quoting in his Appellant’s Brief the
following language from the district court opinion: “While FedEx may have been
suspicious of Sunshine Wholesale based on the odd appearance of its May 6, 2002
shipment of baby formula, this suspicion was insufficient to permit FedEx to
initiate an open-ended consent to inspection by the U.S. Customs Service of all
packages from Sunshine Wholesale.” Even if quoting portions of the district
court opinion could be considered making an argument, this language does not
constitute a “fruit of the poisonous tree” argument. Indeed, the warrantless
search of the May 6, 2002 shipment was valid due to its suspicious nature. See
United States v. Blum, 329 F.2d 49, 52 (2d Cir. 1964) (upholding a U.S. Customs
warrantless search of a package that the carrier could tell without opening
contained contents that had been misdeclared). Therefore, the warrantless search
of the May 6, 2002 shipment is not itself a “poisonous tree.” The district court
found subsequent warrantless searches at FedEx to be improper (and the government
does not challenge this ruling), but found that, for the evidence the government
9
only evidence obtained during the government’s improper warrantless
searches of the FedEx shipments that was admitted during the guilt-
innocence phase of the trial came from the shipments to a company
controlled by a fully cooperating individual (Vietti), that
evidence inevitably would have been discovered. Therefore, the
district court did not err in denying Ghali’s motion to suppress
evidence.
B. Sufficiency of the evidence
Ghali challenges the sufficiency of the evidence for his
conviction on nine counts of violating 18 U.S.C. § 1956(a)(3)(A).8
Specifically, Ghali argues that the government failed to prove that
the items purchased by Ghali or his agents were actually
represented to him as stolen. When reviewing a challenge to the
sufficiency of the evidence, we view the evidence in the light most
favorable to the verdict and affirm if a rational trier of fact
sought to admit, the exclusionary rule did not apply (and in any event Vietti’s
implied consent sustained those searches of shipments to his company). Ghali has
not argued that the admitted evidence was obtained from such improper searches
(other than those of the 2003 shipments to Vietti).
8
These counts are the money laundering-sting counts, count ten through
count eighteen of the superseding indictment. The relevant portion of the money-
laundering statute provides:
“Whoever, with the intent – (A) to promote the carrying on of
specified unlawful activity . . . conducts or attempts to conduct a
financial transaction involving property represented to be the
proceeds of specified unlawful activity, or property used to conduct
or facilitate specified unlawful activity, shall be fined under this
title or imprisoned for not more than 20 years, or both. For
purposes of this paragraph and paragraph (2), the term ‘represented’
means any representation made by a law enforcement officer or by
another person at the direction of, or with the approval of, a
Federal official authorized to investigate or prosecute violations
of this section.” 18 U.S.C. § 1956(a)(3)(A).
10
could have found that the government proved all essential elements
of the crime beyond a reasonable doubt. United States v.
Puig-Infante, 19 F.3d 929, 937 (5th Cir. 1994).
Ghali argues that the property involved was not represented to
him as stolen, as was alleged in the indictment and as is required
by section 1956(a)(3). He concedes that the property involved was
probably represented to his co-indictees as stolen, but he argues
that there is no proof in the record that it was ever represented
to him that the property was stolen. Ghali claims that “the
Government had the duty to explicitly represent that the property
was proceeds of an unlawful activity (actually stolen).” However,
in United States v. Castaneda-Cantu, 20 F.3d 1325 (5th Cir. 1994),
we rejected an argument similar to the one made by Ghali:
“Law enforcement agents do not have to make express
representations that the funds to be laundered were
proceeds of specified unlawful activity. ‘It is enough
that the government prove that an enforcement officer or
other authorized person made the defendant aware of
circumstances from which a reasonable person would infer
that the property was drug proceeds.’” Id. at 1331(quoting United States v. Kaufmann, 985 F.2d 884, 893
(7th Cir. 1993)).
In this case, the evidence showed that a reasonable person in
Ghali’s circumstances would infer that the property involved was
stolen property. Ghali’s specific argument on this issue,
therefore, fails. Aside from this argument, Ghali has explicitly
conceded every element of the government’s case on these counts.
11
We affirm Ghali’s convictions on the nine counts of money
laundering–sting.
C. The sentence enhancements
Ghali also argues that the district court erred by enhancing
his sentence for the use of minors (U.S.S.G. § 3B1.4) and
obstruction of justice (§ 3C1.1). The district court's
interpretation and application of the guidelines is reviewed de
novo and its factual findings are reviewed for clear error. United
States v. Infante, 404 F.3d 376, 393–94 (5th Cir. 2005).
There was evidence presented that Ghali’s minor children were
frequently included (albeit at a low level) in the Ghali
organization’s operations in furtherance of the conspiracy. For
example, Ghali’s children were used for unloading and storing
stolen property and for counting out large amounts of cash to be
paid for the stolen property.9 We find no error in the district
court’s application of the § 3B1.4 enhancement.
9
Ghali argues that he did not personally use or attempt to use any of his
minor children to commit any of the offenses or to assist in avoiding detection
of, or apprehension for, the offenses, and that his sentence should not be
enhanced under § 3B1.4 simply because his co-conspirators so used the minor
children. For support, Ghali cites to United States v. Pojilenko, 416 F.3d 243(3d Cir. 2005), a case in which the court did indeed hold that that the § 3B1.4
enhancement is not appropriate based only on a co-conspirator’s reasonably
foreseeable use of a minor. The Pojilenko court acknowledged that its holding
on this issue was in conflict with the Eleventh Circuit’s opinion in United
States v. McClain, 252 F.3d 1279 (11th Cir. 2001). We need not decide between
the reasoning of Pojilenko and McClain in this case, however, because there is
evidence that Ghali personally instructed Luai to use Ghali’s minor son Amir to
help unload the “stolen” property into a storage facility and that Amir did so
help.
12
There was also evidence that Stephanie had received threats as
a result of her decision to testify against Ghali and that, during
the trial testimony of a confidential informant, a spectator in the
courtroom made a throat-slashing gesture that frightened the
witness. In the circumstances of this case, we cannot say it was
clearly erroneous for the court to infer that Ghali was indirectly
attempting to threaten or intimidate witnesses. Accordingly, we
find no error in the district court’s application of the § 3C1.1
enhancement.
Conclusion
For the foregoing reasons, we affirm the judgment of the
district court.
AFFIRMED.
13