State v. Howell

2016 UT App 90THE UTAH COURT OF APPEALS
STATE OF UTAH,
Appellee,
v.
GREGORY KENT HOWELL,
Appellant.
Memorandum Decision
No. 20120204-CA
Filed April 28, 2016
Third District Court, Salt Lake Department
The Honorable Judith S.H. Atherton
No. 091902210
B. Kent Morgan and Benjamin R. Dyer, Attorneys
for Appellant
Sean D. Reyes and Karen A. Klucznik, Attorneys
for Appellee
JUDGE GREGORY K. ORME authored this Memorandum Decision,
in which JUDGE STEPHEN L. ROTH and SENIOR JUDGE PAMELA T.
GREENWOOD concurred.1
ORME, Judge:
¶1 Gregory Kent Howell (Defendant) appeals his conviction
and sentence on three counts of securities fraud and one count of
pattern of unlawful activity, for which the trial court sentenced
him to four concurrent prison terms of one to fifteen years. We
affirm.
1. Senior Judge Pamela T. Greenwood sat by special assignment
as authorized by law. See generally Utah R. Jud. Admin. 11-
201(6).
State v. Howell
¶2 In 2006, Defendant and his former colleague
(Codefendant) sought to buy and complete a large residential
development known as the Fruitland Project. They solicited
investors by overstating their experience and understating the
risk, and Codefendant funneled investor funds to an undisclosed
side project called Alpha Bay. After the Fruitland Project failed
and investors complained, the State investigated and ultimately
charged both Defendant and Codefendant. Codefendant entered
into a plea agreement which, among other things, required him
to testify against Defendant in exchange for a reduced sentence.
After a jury trial in which Codefendant testified against him,
Defendant was convicted. Defendant now argues that the trial
court erred in convicting him under Utah’s Pattern of Unlawful
Activity Act, that he received ineffective assistance from his trial
counsel, that the State failed to show that he acted willfully and
therefore did not prove every element of securities fraud, that
the prosecution withheld material evidence, and that his
sentence was unconstitutionally disproportionate to that of
Codefendant.2 Each of Defendant’s five arguments fails.
2. Defendant articulated a sixth argument: a challenge to the
definition of ‚security‛ as used in this case. But Defendant has
not developed that argument. Instead, Defendant addressed the
issue in one sentence, without citing any authority, in his
statement of the issues. While ‚adequate briefing . . . is not a
‘hard-and-fast default notion,’‛ State v. Roberts, 2015 UT 24, ¶ 18,
345 P.3d 1226 (quoting State v. Nielsen, 2014 UT 10, ¶ 40, 326 P.3d
645), rule 24 of the Utah Rules of Appellate Procedure sets out
substantive requirements that parties must satisfy or risk having
their briefs ‚disregarded or stricken,‛ Utah R. App. P. 24(k). An
opening brief ‚shall contain the contentions and reasons of the
appellant with respect to the issues presented . . . with citations
to the authorities, statutes, and parts of the record relied on.‛ Id.R. 24(a)(9). ‚[A]ppellants who fail to follow [those] requirements
will likely fail to persuade the court of the validity of their
(continued…)
20120204-CA 2 2016 UT App 90State v. Howell
¶3 Defendant’s first argument is that his conduct did not fall
within Utah’s Pattern of Unlawful Activity Act. Defendant
claims that criminal conduct spanning only a few weeks or
months, with no threat of future criminal conduct, ‚do*es+ not
constitute a pattern of unlawful activity.‛ He argues that the
relevant events occurred in the span of about one month, which
he contends was too short to constitute a ‚pattern‛ under the
statute. We do not reach the merits of Defendant’s claim,
however, because he has not complied with our preservation
requirement. See Utah R. App. P. 24(a)(5) (requiring all opening
briefs to include a ‚citation to the record showing that the issue
was preserved in the trial court . . . or . . . a statement of grounds
for seeking review of an issue not preserved in the trial court‛).
Defendant’s opening brief provides no preservation citation for
this issue. Only after the State pointed out his lack of
preservation did Defendant, in his reply brief, claim that the
plain error exception to our preservation rule applies.
¶4 But dealing with preservation in the reply brief is too late.
‚[W]e have consistently refused to consider arguments of plain
error raised for the first time in an appellant’s reply brief, even if
the plain error argument is in response to a dispute over
preservation raised for the first time in the appellee’s brief.‛
Marcroft v. Labor Comm’n, 2015 UT App 174, ¶ 4, 356 P.3d 164(citation and internal quotation marks omitted). Because
Defendant made no mention of the plain error exception until
the reply brief, we will not consider whether this alleged error
was plain. See id.(…continued)
position.‛ Roberts, 2015 UT 24, ¶ 18. Because this potential sixth
issue is inadequately briefed, we are wholly unpersuaded and
simply assume for purposes of this appeal that the transactions
in question involved securities.
20120204-CA 3 2016 UT App 90State v. Howell
¶5 Defendant’s second argument is that he received
ineffective assistance from his trial counsel. A defendant
claiming ineffective assistance of counsel must show both ‚that
counsel’s performance was deficient‛ and ‚that the deficient
performance prejudiced the defense.‛ Strickland v. Washington,
466 U.S. 668, 687 (1984). See also State v. Hards, 2015 UT App 42,
¶ 18, 345 P.3d 769 (‚*F+ailure to prove either element defeats the
claim.‛). ‚Performance is deficient when it falls below an
objective standard of reasonableness. . . . A defendant suffers
prejudice when, absent the deficiencies of counsel’s
performance, there is a reasonable likelihood that the defendant
would have received a more favorable result at trial.‛ Hards,
2015 UT App 42, ¶ 18. To determine if prejudice occurred, we
‚must consider the totality of the evidence‛ and ask if the
alleged error ‚had a pervasive‛ or ‚an isolated, trivial effect.‛
Strickland, 466 U.S. at 695–96.
¶6 Defendant claims that trial counsel’s performance was
deficient because counsel did not impeach Codefendant’s
testimony during cross-examination by asking about the terms
of Codefendant’s plea agreement, which failure Defendant says
was prejudicial given the importance of Codefendant’s
testimony to the State’s case. But even assuming that counsel’s
performance was objectively deficient, Defendant has not shown
that any such deficiency prejudiced the defense. Trial counsel’s
decision not to impeach Codefendant did not deprive Defendant
of a fair trial when Codefendant would have testified that the
only plea agreement in effect at that time called for him to plead
guilty and testify against Defendant, when that plea and ensuing
conviction would put Codefendant at risk of deportation, and
that no subsequent, more favorable deal had been finalized as of
that time.
¶7 Further, the totality of the evidence would weigh in favor
of guilt even if Defendant’s trial counsel had successfully
impeached Codefendant’s testimony by highlighting his plea
agreement because of the investors’ testimony regarding
20120204-CA 4 2016 UT App 90State v. Howell
Defendant’s deceptive statements and Defendant’s own
admissions. Thus, we conclude that Defendant’s trial counsel did
not render constitutionally ineffective assistance by failing to
question Codefendant about the terms of his plea agreement
because Defendant has not demonstrated that any errors in this
regard prejudiced him.
¶8 Defendant’s third argument is that the State did not prove
every element of securities fraud because it did not prove
willfulness. When reviewing the sufficiency of evidence
following a jury trial, ‚we review the evidence and all inferences
which may reasonably be drawn from it in the light most
favorable to the verdict.‛ State v. Shumway, 2002 UT 124, ¶ 15, 63
P.3d 94. And we will reverse ‚only when the evidence is
sufficiently inconclusive or inherently improbable that
reasonable minds must have entertained a reasonable doubt‛ as
to Defendant’s guilt. Id.
¶9 The requisite mental state for securities fraud is
willfulness, see Utah Code Ann. § 61-1-21 (LexisNexis 2011),3
which requires proof that a defendant ‚desire[d] to engage in the
conduct or cause the result,‛ id. § 76-2-103 (2012), and ‚act*ed]
deliberately and purposefully, as distinguished from merely
accidentally or inadvertently,‛ State v. Larsen, 865 P.2d 1355, 1358
n.3 (Utah 1993). ‚Willful does not require an intent to violate the
law or to injure another or acquire any advantage.‛ Id.
¶10 Defendant contends that he could not have acted willfully
because he did not know at the outset about Codefendant’s plan
to funnel money away from the Fruitland Project and into Alpha
Bay and because he was never a signatory on the accounts or an
3. Although various statutes at issue in this case have been
amended or renumbered since 2006, the changes are
inconsequential in the context of this case. Therefore, for ease of
reference, we cite the most recent codification of these statutes.
20120204-CA 5 2016 UT App 90State v. Howell
active participant in the scheme that ultimately defrauded the
investors. The fraudulent conduct, however, did not consist only
of Codefendant’s diversion of the funds but also included
Defendant’s withholding information regarding the diversion
from the investors. Codefendant told Defendant of his plan to
divert some funds away from the Fruitland Project and to
temporarily use that money to fund Alpha Bay before Defendant
began soliciting investor funds. Instead of informing potential
investors about the Alpha Bay plan, however, Defendant
expressed concern to Codefendant about the plan. But
Codefendant apparently convinced Defendant that the transfer
would be short term and might actually benefit the Fruitland
Project. In any event, Defendant failed to notify the investors of
Codefendant’s expressed plan and his own misgivings about it.4
¶11 Furthermore, the investors testified to several instances in
which Defendant made fraudulent statements: (1) Defendant
falsely represented that he and Codefendant had been involved
in ‚projects,‛ causing investors to believe that Defendant ‚had
been involved in several large-scale commercial projects‛; (2)
Defendant told one investor that ‚fifty percent of the lots were
already under contract,‛ but failed to disclose that these
‚contracts‛ were not legally binding and instead represented
only reservations of particular lots; and (3) Defendant told other
investors that lots in the development already had deposits on
them, totaling $12 million, when in fact there were no such
4. Defendant contends that the only evidence of his dishonesty
comes from Codefendant’s testimony, in violation of Utah law.
See State v. Christean, 533 P.2d 872, 876 (Utah 1975) (conviction
may not rest solely on testimony of accomplice). But as
explained above, see infra ¶ 11, Codefendant’s testimony is not
the only evidence that Defendant willfully misled the investors.
See id. (‚Although a conviction may not rest solely upon the
testimony of an accomplice, all of the circumstances may be
viewed together to determine the facts.‛).
20120204-CA 6 2016 UT App 90State v. Howell
deposits. Investors also testified that Defendant never clarified
that neither Defendant nor Codefendant had previously
participated in a large real estate development project. Evidence
of each of these statements and omissions was before the jury,
and the evidence shows that the jury’s conclusion that
Defendant acted willfully in misleading the investors is not
inconclusive or inherently improbable such that reasonable
minds would necessarily have entertained reasonable doubts
about Defendant’s guilt.
¶12 Defendant’s fourth argument is that the State failed to
turn over material evidence that would have affected the
outcome if Defendant had known about it. He claims that the
State failed to timely disclose that Codefendant was a Canadian
citizen facing deportation and that the State would eventually
agree to a further reduced sentence to help Codefendant avoid
deportation.5 At the time of trial, Codefendant’s plea deal had
not changed, but Defendant alleges that the fact of
Codefendant’s Canadian citizenship made it inevitable that the
State would offer Codefendant a new, improved deal to limit the
risk of his deportation. Thus, Defendant argues that the State’s
withholding of that evidence necessitates a new trial under Brady
v. Maryland, 373 U.S. 83 (1963), and its progeny, especially Giglio
v. United States, 405 U.S. 150 (1972). But Defendant has not
shown that he properly preserved this issue, and he has not
shown that the plain error doctrine applies and warrants our
review of the issue.
¶13 ‚To preserve an issue, counsel must raise the issue in the
trial court ‘in such a way that the trial court has an opportunity
5. At Defendant’s trial, Codefendant testified that there had been
no promises other than those made in the first plea agreement.
Defendant’s argument assumes that the State must surely have
known what it would eventually do and that he was entitled to
have that knowledge shared with him before trial.
20120204-CA 7 2016 UT App 90State v. Howell
to rule on that issue.’‛ State v. Bird, 2015 UT 7, ¶ 10, 345 P.3d
1141 (quoting Pratt v. Nelson, 2007 UT 41, ¶ 15, 164 P.3d 366). We
consider whether the issue was raised in a timely and specific
manner along with ‚supporting evidence or relevant legal
authority‛ in assessing whether the trial court had a legally
sufficient opportunity to rule on the issue. Pratt, 2007 UT 41, ¶ 15
(citation and internal quotation marks omitted). Defendant
argues that he preserved the issue in his rule 60(b) motion for a
new trial. As the State notes, however, Defendant failed to timely
file for a new trial, and the trial court dismissed the motion on
jurisdictional grounds.6 Therefore, the rule 60(b) motion did not
provide the trial court with an opportunity to rule on the merits
of the Brady issue so as to preserve it for appeal. And while the
trial court noted that Defendant had filed a timely appeal, such
knowledge would ordinarily reflect, at most, that the trial court
knew of Defendant’s dissatisfaction with the verdict against him,
not that it had the opportunity to rule on any particular issue.7
6. ‚If the trial court refuses to address the merits of the newly
advanced argument, the issue remains unpreserved for appellate
review and may be addressed only if the challenging party can
show plain error or exceptional circumstances.‛ State v. Pinder,
2005 UT 15, ¶ 46, 114 P.3d 551.
7. This case is in a somewhat unique posture. The parties and the
trial court engaged in an extensive discussion of the alleged
Brady violation during oral argument on Defendant’s rule 27
motion to stay the sentence pending appeal. Rule 27 of the Utah
Rules of Criminal Procedure requires a defendant who is seeking
to avoid incarceration pending appeal to ‚file a written motion‛
and memorandum with the trial court that, among other things,
‚identif[ies] the issues to be presented on appeal and support[s]
the defendant’s position that those issues raise a substantial
question of law or fact reasonably likely to result in a reversal.‛
Utah R. Crim. P. 27(b)(2)(A). The trial court then determines
whether to issue a certificate of probable cause. See id.(continued…)
20120204-CA 8 2016 UT App 90State v. Howell
Because the motion was not timely and the trial court was not
legally bound to address the merits, including the Brady issue,
Defendant’s Brady claim is not preserved.
¶14 Therefore, our review of Defendant’s Brady claim is
limited to the review for plain error alternatively sought by
Defendant. See State v. Gailey, 2015 UT App 249, ¶ 7, 360 P.3d
805. Plain error applies only when an appellant shows that ‚(i)
[a]n error exists; (ii) the error should have been obvious to the
trial court; and (iii) the error is harmful, i.e., absent the error,
there is a reasonable likelihood of a more favorable outcome for
the appellant, or phrased differently, our confidence in the
verdict is undermined.‛ State v. Dunn, 850 P.2d 1201, 1208–09
(Utah 1993). Even assuming Defendant has met the first two
elements of plain error—and it is difficult to see how the
requirement of obviousness to the trial court would have been
met—he cannot prove that the State’s failure to provide evidence
of Codefendant’s Canadian citizenship (and the possible
deportation implications) was a harmful error such that it
undermines our confidence in the jury verdict. The mere
possibility of a more favorable deal for Codefendant would not
substantially affect Codefendant’s credibility as a witness.
Indeed, if counsel had questioned Codefendant on the issue and
he had testified truthfully, he would have said that the only deal
then agreed upon was Codefendant’s initial plea agreement,
which ultimately may have bolstered Codefendant’s credibility
because he was willing to testify against Defendant even though
the guilty plea entailed the risk of deportation. Thus, even if this
(…continued)
R. 27(b)(1)(A)–(b)(3)(B). Although the Brady issue was addressed
in this context, the court only had authority to assess the
strength of Defendant’s issues for appeal in the process of
deciding whether Defendant should remain incarcerated during
appeal—not to rule on whether to grant a new trial. (The trial
court denied Defendant’s Rule 27 motion.)
20120204-CA 9 2016 UT App 90State v. Howell
was an error and even if the error was plain, Defendant has not
shown that the State’s failure to turn over this information was
prejudicial. Because Defendant has not established prejudice, we
cannot conclude that the plain error exception to preservation
applies.
¶15 Defendant’s final argument is that his sentence violates
the ban on ‚cruel and unusual punishment‛ set forth in Article
1, section 9 of the Utah Constitution.8 We determine whether a
sentence is unconstitutionally cruel and unusual by asking if
‚the sentence imposed in proportion to the offense committed is
such as to shock the moral sense of all reasonable men as to what
is right and proper under the circumstances.‛ State v. Nance, 438
P.2d 542, 544 (Utah 1968). Accord Monson v. Carver, 928 P.2d 1017,
1024 (Utah 1996). Defendant, in contrast, asserts that his sentence
was cruel and unusual because it was disproportionate to
Codefendant’s sentence. And he argues, based on the Utah
Supreme Court’s plurality opinion in State v. Gardner, 947 P.2d
630 (Utah 1997), that the trial court should have considered the
proportionality of his sentence to Codefendant’s sentence as well
as to the severity of the crime itself. But in Gardner, a majority of
8. Defendant cited only the Utah Constitution in his opening
brief, but he referenced the Eighth Amendment to the United
States Constitution in his reply brief. Although we focus our
analysis on the Utah Constitution because that is how the issue
was framed for us in Defendant’s opening brief, see supra ¶ 4, we
note that the outcome would be no different under the U.S.
Constitution. See State v. Houston, 2015 UT 40, ¶ 145, 353 P.3d 55(Lee, J., concurring) (‚[N]o majority of [the Utah Supreme Court]
has ever adopted an independent standard of proportionality
under article 1, section 9 of the Utah Constitution. For the most
part we have simply conflated the state and federal standards
and treated them as indistinguishable. . . . And the sole exception
to that rule is Gardner, in which a majority of the court refused to
embrace any independent state standard.‛).
20120204-CA 10 2016 UT App 90State v. Howell
the Court compared the defendant’s sentence only to the
defendant’s offense, which is the traditional method of assessing
proportionality. See id. at 652. Further, the Utah Supreme Court
has expressly rejected arguments that proportionality review
includes comparing a defendant’s sentence to that of a defendant
in an already decided case who was convicted of the same crime.
State v. Carter, 888 P.2d 629, 656 (Utah 1995), superseded by statute
on other grounds as recognized by Archuleta v. Galetka, 2011 UT 73,
¶ 70, 267 P.3d 232.
¶16 Given the Utah Supreme Court’s refusal to compare for
proportionality the sentences of defendants in different cases
who are guilty of the same crime, we see no obvious reason why
a different rule would apply in the case of codefendants. And
Defendant has not persuaded us otherwise.9 It is true that
9. Indeed, disparate sentences among codefendants are not
uncommon in our jurisprudence, and they have been upheld by
other appellate courts. See, e.g., United States v. Kuhrt, 788 F.3d
403, 408, 424–25 (5th Cir. 2015) (affirming defendant’s disparate
sentence even though defendant was merely an employee of his
coconspirator who orchestrated a multi-billion-dollar Ponzi
scheme when defendant’s sentence fell within the
federal guidelines and the coconspirator ‚plead*ed+ guilty,
accept*ed+ responsibility and testif*ied+ at multiple trials‛);
United States v. McKinney, 53 F.3d 664, 678 (5th Cir. 1995)
(affirming defendant’s disparate sentence when defendant’s
sentence was within the federal sentencing guidelines and his
only challenge was based on the lesser sentence of his more-
culpable codefendant); United States v. Rackstraw, 7 F.3d 1476,
1482 (10th Cir. 1993) (holding ‚that the sentencing disparity
[did] not violate the Eighth Amendment‛ when coconspirators
in the transport of crack cocaine received roughly equal
sentences despite one coconspirator transporting 1,040 ounces
during a two-year period while the other transported ‚only
sixteen-and-one-half . . . ounces on one occasion‛).
20120204-CA 11 2016 UT App 90State v. Howell
Defendant faces between one and fifteen years in prison in
addition to his obligation to pay restitution to the investors while
Codefendant, who testified against him but arguably played a
more important role in the scam, is obligated only to serve
probation and pay restitution. Although these sentences are
disparate, Defendant’s only challenge to the legality of his
sentence is to point out the disparity of the two sentences and
Codefendant’s greater culpability. And as explained above,
proportionality review does not turn on such a comparison.10
¶17 Affirmed.
10. Defendant also argues on appeal that the trial court
improperly considered his refusal to admit guilt as a factor in its
sentencing decision, an argument he supports by alleging,
without record citations, that the State raised his refusal to admit
guilt during sentencing. Even assuming that the State made an
improper remark about Defendant’s refusal to admit guilt in
support of its argument for incarceration, ‚the trial court is
presumed to have disregarded the prosecutor’s commentary.‛
State v. Phillips, 2012 UT App 286, ¶ 25, 288 P.3d 310. Thus,
‚‘there will not be a reversal unless it affirmatively appears that
the court was misled or improperly influenced by such
remarks.’‛ Id. (quoting People v. Myatt, 384 N.E.2d 85, 88 (Ill.
App. Ct. 1978)). Defendant has pointed to no affirmative
evidence that the trial court considered the State’s alleged
improper remark. Thus, we will not disturb the sentence the trial
court imposed on that ground.
20120204-CA 12 2016 UT App 90