Free Order on Motion for Miscellaneous Relief - District Court of Arizona - Arizona

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

WO

IN THE UNITED S TATES DIS TRICT COURT FOR THE DIS TRICT OF ARIZONA

United States of America, Plaintiff, vs. Calvin B. Schaefer, Defendant.

) ) ) ) ) ) ) ) ) ) ) )

No. CR 03-1167-PHX-DGC

ORDER DENYING MOTION TO DIS MIS S COUNTS ONE AND TWO

Pending before t he Court is Defendant Calvin B. Schaefer's M otion to Dismiss Counts One and Two of the Superceding Indictment. (D kt . 956.) The Government filed a response opposing Defendant's motion. (Dkt. 1071.) No reply has been filed. DIS CUS S ION In Counts One and Two of the Second Superceding Indict ment ("Indictment"), Defendant is charged, respectively, with racketeering under the Racketeer Influenced and Corrupt Organization Act ("RICO"), in violation of 18 U .S.C. § 1962(c), and RICO conspiracy, in violation of 18 U.S.C. § 1962(d). (Dkt. 541.) Defendant seeks dis missal of these Counts on the grounds that the Indictment fails to support the element s of the charges. Specifically, Defendant claims, wit h respect to both Counts, that the Indictment

fails to allege that Defendant engaged in a pattern of racketeering activity. The elements of a RICO cons p iracy as alleged in Count Two include a substantive RICO violation. See U nited States v. Frega, 179 F.3d 793, 821 (9th Cir. 1999). Therefore, Document 1175 Filed 02/03/2006 Page 1 of 6

Case 2:03-cr-01167-DGC

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

each of the challenged counts must allege a pattern of racketeering activity. of the Indictment incorporates Count One's general allegations

Count Two the

concerning

racketeering enterprise, its purpose, and its means and met hods of operation. (Dkt. 541 at 10.) These incorporated allegations do not include the detailed allegations of predicat e

acts set forth in Section E of Count One, but they do refer to the criminal conduct that is described in more detail in the predicate act s . (Id. at 3-5.) M oreover, the Defendants

named in Count Two all appear in Count One as well. (Id. at 10.) T he Court concludes that Count Two adequat ely incorporates the pattern of racketeering alleged in Count One and that a defendant reading the Indictment would be on notice of the racketeering charges against him.1 In considering a pre-trial motion to dismiss an indictment for failure to state an offense, the Court must accept the truth of the allegations in the indictment. See United States v. Jensen, 93 F .3d 667, 669 (9th Cir.1996). In analyzing whether an offense has been

properly charged, the Court is bound by the four corners of the indictment. U.S. v. Boren, 278 F.3d 911, 914 (9th Cir. 2002); see Jensen, 93 F.3d at 669. "The indict ment either states an offens e or it doesn't. There is no need for an evidentiary hearing." U.S. v. Boren, 278

17 F.3d at 914. 18 charged offens e s o as to ensure the right of the defendant not to be placed in double 19 20 21 22 23 24 25 26 27 28 -2Case 2:03-cr-01167-DGC Document 1175 Filed 02/03/2006 Page 2 of 6 Defendant argues t hat t he criminal acts at issue in Count Two are not clear. He assert s , for example, that the murder allegation in Count Two is ambiguous because the Defendants alleged to have committed the murder of Cynthia Garcia ­ Augustiniak and Eischeid ­ are not alleged to be part of the Count Two conspiracy and Count Two therefore must refer t o some unidentified murder. (Dkt. 956.) Defendants Augustiniak and Eischeid are, however, expressly included in Count Two. (Dkt. 541 at 10, lines 8-9.) In fact , each of the Defendants named in Count Two is also named in Count One, and the language incorporated from Count One includes the s ame kinds of crimes as are alleged in the specific predicate acts of Count O ne. The Court concludes that Count Two sufficiently makes clear that the pattern of racketeering alleged in the two counts is the same.
1

"Generally, an indictment is s ufficient if it sets forth the elements of the

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

jeopardy and to be informed of the offense charged." United States v. Rodriguez, 360 F.3d 949 (9th Cir. 2004) (quoting United States v. Woodruff, 50 F.3d 673, 676 (9th Cir.1995)). Because the Indictment follows the statutory language and adequately sets out t he elements of the offenses ­ describing the racketeering enterprise and identifying the racketeering act s ­ t he Court will focus on Defendant's challenge to the sufficiency of the facts the Indictment alleges with respect t o the pattern-of-racketeering-activity element. A s it does so, the Court is informed by the Supreme Court's admonition that " RICO is t o be read broadly" and "liberally construed to effectuate its remedial purposes." Sedima,

S.P.R.L. v. Imrex Co., Inc., 473 U.S. 479, 497 (1985); see Ikuno v. Yip, 912 F.2d 306, 309 (9th Cir. 1990). Count 1 alleges that Defendant violated 18 U.S.C. § 1962(c): It shall be unlawful for any person employ ed by or associated with any enterprise engaged in, or the activit ies of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt. Violat ion of 18 U.S.C. § 1962(c), therefore, requires four elements: "(1) conduct (2) of

16 an enterprise (3) through a pattern (4) of racketeering activity." Sedima, 473 U .S. at 496; see 17 18 19 20 21 22 23 24 25 26 27 28 -3Case 2:03-cr-01167-DGC Document 1175 Filed 02/03/2006 Page 3 of 6 United States v. Fernandez, 388 F.3d 1199, 1221 (9t h Cir. 2004); Howard v. America Online Inc., 208 F.3d 741, 746 (9th Cir. 2000). A pattern of racketeering activity requires at least two predicate acts, a predicate act being defined as " any act or threat involving murder, kidnapping, gambling, arson, robbery, bribery, ext ortion, dealing in obscene matter, or dealing in a controlled substance . . ." that is an offense under state law "and punishable by imprisonment for more than one year." 18 U.S.C. § 1961(1). The Indictment alleges t hat from 1999 through August 31, 2004, the Hells Angels M otorcycle Club ("HAM C") was an enterp rise that engaged in racketeering activities. (Dkt. 541 at 5.) The Indictment further charges that HAM C members and associates, including

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18

Defendant , commit t ed 20 specific racketeering acts.2

(Id. at 5­9.) Defendant asserts that

the Indictment fails to allege a connection between these predicate acts sufficient to establish a pattern of racketeering activity. (Dkt. 956 at 3.) A "`pattern of racket eering activity' requires at least two acts of racketeering activity, . . . the last of which occurred w it hin ten years (excluding any period of imprisonment) after the commission of a prior act of racketeering activity." 18 U.S.C. § 1961(5). Analyzing the statute's language and legislative history, the Sup reme Court has

held that the occurrence of two predicate acts is necessary but not sufficient to establis h a "pattern of racketeering activity." H.J. Inc. v. Northwestern Bell Telephone Co., 492 U.S. 229, 237-238 (1989). Two additional requirements must be met: t he G overnment must show "that the racketeering predicates are related, and that they amount to or p os e a threat of continued criminal activity." Id. at 239 (emphasis in original); Fernandez, 388 F.3d at 1221 n. 11. A pattern of racketeering activity, therefore, requires proof that the acts are "related" and pose a threat of "continuity." Predicates acts are related if they "have the same or s imilar purposes, results, participants, victims, or methods of commission, or otherwise are interrelated by distinguishing characteristics and are not isolated events." (quoting 18 U.S.C. § 3575(e)). H.J. Inc., 492 U.S. at 240

As alleged in the Indictment, each of the predicate acts

19 occurred under the auspices of t he H A M C, was committed by an HAM C member or 20 associate, and was undertaken for the purpose of furthering the HAM C's objective of 21 protecting and expanding its territory and aut hority. 22 which must be taken as true for the purpose of ruling on Defendant 's motion, are sufficient 23 24 25 26 27 28 -4Case 2:03-cr-01167-DGC Document 1175 Filed 02/03/2006 Page 4 of 6 Defendant is alleged to have committed three predicate acts: the attempted murder of M ongols (members of a rival motorcycle gang) in the District of Nevada on or about April 27, 2002; dis t ribution of methamphetamine in the District of Arizona on or about February 12, 2003; and distribution of methamphetamine in the District of Arizona on or about February 18, 2003. (Dkt. 541.)
2

(Dkt. 541 at 4.)

These allegations,

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18

to satisfy the requirement of relatedness.

See United States v. Yarbrough, 852 F.2d 1522,

1544 (9th Cir. 1988) (evidence was sufficient to sustain RICO conviction where defendant committed three predicate acts "on the Order's behalf"); Unit ed States v. Smith, 413 F.3d 1253, 1269­70 (10th Cir. 2005) (predicate acts including murder and conspiracy to murder rival gang members were sufficient to show relatedness); United States v. Delgado, 401 F.3d 290, 298 (5th Cir. 2005) (predicate act s "committed in furtherance of [the gang's] business" were related). Predicate acts sat is fy the continuity requirement if they "amount to or threaten longt erm criminal activity." H.J. Inc., 492 U.S. at 239. The threat of continuity "is sufficiently established where the predicates can be attributed to a defendant operating as part of a long-term association that exists for criminal purposes." Id. In addition, "the threat of

cont inuit y may be established by showing that the predicate acts or offenses are part of an ongoing entity's regular way of doing busines s ." Id. Continuity also exists where "the

racketeering acts themselves include a specific threat of repetition extending indefinitely into the future, and thus supply the requisite threat of continuity." Id. The facts alleged in the Indict ment satisfy the continuity requirement. The

Indictment alleges that HAM C members engaged in 20 racketeering acts over a p eriod of more t han five years. (Dkt. 541.) Along with the acts alleged against Defendant, the

19 Indictment charges HAM C members with commit t ing p redicate acts of kidnaping, murder, 20 conspiracy to murder, witness tampering, and drug dis t ribut ion. 21 alleges that these acts were committed under the direction of the HAM C to further it s 22 unlawful nature, to maintain and increase its influence, and to benefit it s members. 23 These allegations, which must be taken as true for purposes of this motion, support a 24 finding that Defendant's role in three of the racketeering acts represented a threat of 25 26 27 28 -5Case 2:03-cr-01167-DGC Document 1175 Filed 02/03/2006 Page 5 of 6 continuing criminal activity. (Id.) (Id.) The Indictment

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

"Where the enterprise is an entity whose business is racketeering activity, an act performed in furtherance of that business aut omatically carries with it the threat of continued racketeering activity." United States v. Indelicato, 865 F.2d 1370, 1383­84 (2d Cir. 1989); see United States v. Torres, 191 F.3d 799, 808 (7th Cir. 1999); United St at es v. Diaz, 176 F.3d 52, 93­94 (2d Cir. 1999). As the Second Circuit has explained: in cases where t he act s of the defendant or the enterprise were inherently unlawful, such as murder or obstruction of justice, and were in p urs uit of inherently unlawful goals, such as narcotics trafficking or embez z lement, the courts generally have concluded that the requisite threat of continuity was adequately established by the nature of the activity, even though the period spanned by the racketeering activity was short. United States v. Aulicino, 44 F.3d 1102, 1111 (2d Cir. 1995). Here, the life of the racketeering activity alleged in the Indictment w as not s hort. The p redicat e acts extended over a substantial period of time and inherently threatened future criminal conduct. H ow ard, 208 F.3d at 750. The Indictment in effect alleges that the HAM C was "operating as part of a long-t erm association that exists for criminal purposes" and that t he racketeering acts were "part of an ongoing entity's regular way of doing business." H.J., Inc., 492 U.S. at 242. Accepting the allegat ions as true for purposes of Defendant's motion, the Court finds that the Indictment sets forth a sufficient factual basis to show that Defendant engaged in a pattern of racketeering activity characterized by relatedness and continuit y as required under 18 U.S.C. § 1962(c). IT IS O RD ERED that Defendant's motion to dismiss Counts One and Two of the Superceding Indictment (Dkt. 956) is denied. DATED this 2nd day of February, 2006.

-6Case 2:03-cr-01167-DGC Document 1175 Filed 02/03/2006 Page 6 of 6