This column reports on several significant, representative decisions handed down recently in the United States District Court for the Eastern District of New York. Judge Jack B. Weinstein explained the reasons for departing well below the guidelines range in sentencing defendant to incarceration for only two months. Judge Weinstein terminated, rather than revoking, the supervised release of a defendant well on the road to rehabilitation whose marijuana addiction had caused him to violate the terms of supervised release. And Magistrate Judge Cheryl L. Pollak, deciding several discovery motions, found communications between a law firm and a retained accountant to be privileged under the circumstances.
Lenient Sentence – Personal and Family Circumstances
In United States v. Smith, 17 CR 221 (EDNY, July 18, 2018), Judge Weinstein stated the reasons for sentencing defendant to two months’ incarceration to be followed by six months’ supervised release where the guideline range was imprisonment for 51 to 63 months and supervised release for one to three years.
In June 2016, defendant was stopped at JFK Airport before boarding a flight to Istanbul. Customs and Border Protection (CBP) officers seized handgun components from his checked bag and explained to him that he needed an export license to transport these parts. A friend had convinced defendant to pack these materials and, if he was stopped, to explain that he was taking them to Turkey to be engraved in the ancient tradition. Defendant naively gave the officers that explanation, which made no sense because the components he carried could not be seen by the covering parts of the handgun.
Acting again on his friend’s advice, he packed more of the components and this time boarded a flight to Turkey from Cleveland, with a stop first at JFK, in the hope that he would avoid JFK’s CBP agents. The officers again stopped defendant and seized the gun parts from his checked bag.
Some months later, he pled guilty to attempting to export to Turkey firearm components without a proper license or State Department approval, in violation of 22 U.S.C §2778(6)(2) and 2778(c) (Arms Export Control Act).
Regarding the relevant sentencing considerations under 18 U.S.C. §3553(a), Weinstein noted that defendant, now 40, had moved here from Turkey in 2004 and was naturalized several years later. He married in 2005. The couple have a 10-year-old son and divorced in 2017. Defendant regularly sees his son, drives him to and from school, and supports the boy and his ex-wife. As a truck driver for a produce company, he works long hours at night. He has a steady history of employment and no prior criminal record.
His “aberrational criminal conduct” was apparently fueled by a cocaine addiction. Slip op. 3. Cocaine use is “not uncommon among night truckers who have grueling jobs.” Slip op. 6 (citation omitted). He spent about $200,000 on cocaine during the five years leading to his arrest. Feeding his habit motivated him to supplement his income by the instant offense. For the past year he has refrained from cocaine use.
The sentence, Weinstein observed, “balances the serious nature of the crime … and the compelling need for the defendant to take his child to and from school and guide the boy.” A two-month sentence will enable defendant to keep his apartment and, in all likelihood, to be promptly reemployed. Slip op. 7.
Drug treatment as a condition of release will help defendant from relapsing in the “stressful months” after release from jail. “Based on his lack of criminal history and improvement while on pretrial supervision, he seems unlikely to recidivate.” Slip op. 8.
As to the policies justifying a shortened term of supervised release, Weinstein cited United States v. Trotter, discussed below.
Supervised Release Terminated
In United States v. Trotter, 15 CR 382 (EDNY, July 12, 2018), Judge Weinstein “revisit[ed] and reconsider[ed]” supervised release in the context of a defendant addicted to marijuana. The court elected not to revoke supervised release and order further incarceration for defendant’s marijuana use. Instead, it terminated supervised release, concluding that “[c]ontinued supervision is unlikely to help rehabilitate [him].” Slip op. 42.
Defendant was sentenced to two years’ imprisonment and three years’ supervised release (the mandatory minimum) after pleading guilty to one count of conspiracy to distribute heroin. Defendant violated the terms of supervised release by using marijuana and failing to comply with drug treatment orders. The Probation Department recommended an additional four months of incarceration.
Weinstein recognized that many states and municipalities had decriminalized marijuana use, including New York City, which has done so through “systemic non-enforcement” of marijuana laws. Marijuana use, however, is still illegal for all purposes under federal law and constitutes a violation of supervised release. As a result, a supervised person using marijuana can be returned to prison.
The purpose of supervised release is to rehabilitate. It may be revoked and the defendant returned to prison if the defendant has violated a condition of supervised release, but it must be revoked if a defendant tests positive for illegal controlled substances more than three times over the course of a year. The majority of district judges, including Weinstein, do not support mandatory revocation for drug use.
A court has discretion to terminate supervised release early if the conduct of the defendant warrants it and termination is in the interests of justice. Relevant factors include: (1) the nature of the offense and the history of the defendant; (2) the need for deterrence; (3) the kind of sentence imposed and sentencing range; (4) Sentencing Commission policy statements; and (5) the need to avoid sentencing disparities among similar defendants. Slip op. 31-32. A district court may terminate supervised release before the expiration of a mandatory minimum period. Marijuana users present a problem for courts because, under federal law, defendants must be sent back to prison for violation of supervised release, while under state law use of marijuana is legal or quasi-legal.
While supervised release is required in less than half of all federal cases, it is imposed as part of nearly every sentence and the length has increased over time. Weinstein discussed various suggestions for improvement, such as tailoring supervised release to each defendant and waiting until the end of a prison term to impose supervised release. The Probation Department has taken measures to mitigate over-supervision by easing up on supervision after the early years.
Weinstein concluded that continued supervision here would probably interfere with defendant’s rehabilitation. Since he was released from prison, defendant had not committed any crimes, had been working and has had the support of friends and family. On the other hand, he had no desire to stop his marijuana habit (in his words, “it’s keeping me calm and on the right path”), and he would probably end up cycling between supervised release and prison. Accordingly, the court terminated defendant’s term of supervised release, so that he would not have to return to prison.
In future cases, Weinstein vowed to: “(1) impose shorter terms of supervised release as needed; (2) give greater consideration to the appropriateness of conditions; (3) provide for earlier termination where indicated; and (4) avoid violations of supervised release and punishment by incarceration merely for habitual marijuana use.” Slip op. 3.
In Chartwell Therapeutics Licensing v. Citron Pharma, 16 CV 3181 (EDNY, July 17, 2018), Magistrate Judge Pollack decided three discovery motions in a matter concerning the sale of pharmaceutical product.
Plaintiff Chartwell Therapeutics Licensing retained Hahn & Hessen (H&H) as counsel in the litigation. Prior to that, H&H had hired the accounting firm of Grassi & Co. to assist in a different litigation for Chartwell concerning the same product. Once retained by Chartwell here, H&H “expanded the scope of the retainer to ask Grassi to advise H&H and Chartwell as to the parties’ respective rights under the Net Sales Share component of the contract between Chartwell and [defendant] Citron[.]” Slip op. 2. Citron then sought discovery of all communications relating to this case between H&H or Chartwell, on the one hand, and Grassi on the other.
Pollak found these communications to be within the scope of the attorney-client privilege. In United States v. Kovel, 296 F.2d 918, 922 (2d Cir. 1961), the Second Circuit, analogizing accountants to translators, had held that communications with accountants retained to assist attorneys in complex matters fall within the attorney-client privilege. Pollak found Kovel controlling: “In light of the complex factual and numerical issues presented by this case, it is eminently reasonable for counsel to rely extensively on the services of an accountant to assist the lawyer in rendering legal advice.” Slip op. 6.
Citron was granted leave to amend its responses to certain notices to admit, regarding its receipt of invoices from Chartwell. Slip op. 6-9. Under Fed. R. Civ. P. 36(b), a court may permit amendment of an admission if it would (1) promote resolution on the merits, and (2) not prejudice the other party in maintaining or defending the action on the merits. Citron argued principally that information it had obtained in discovery rendered its answers inaccurate; Chartwell argued principally that it would be prejudiced by the need to engage in additional discovery on the subjects of the notices.
Pollak allowed amendment because “[w]hether and when certain invoices were received has been a contentious issue in this case,” and the additional discovery amounted to “mere inconvenience or delay” insufficient to demonstrate prejudice “of the kind with which Rule 36(b) is concerned: prejudice in litigation on the merits.” Slip op. 8, 9.
The court denied Citron’s motion to compel Chartwell to produce documents concerning its agreements to supply “Doxycycline suspension.” Slip op. 9-10. Doxycycline suspension was not mentioned in the complaint, which was concerned with “Doxycycline Hyclate tablets and capsules.” Citron failed to demonstrate that discovery regarding Doxycycline suspension was “relevant to any party’s claim or defense and proportional to the needs of the case,” as required by Fed. R. Civ. P. 26(b)(1). Pollak also denied Citron’s footnote request for leave to file a motion to amend if its discovery requests were deemed outside the pleadings because Citron did not provide “sufficient information for the Court to determine if such a motion would be appropriate.” Slip op. 10. But the denial was without prejudice to the right “to file a proper request.”
Harvey M. Stone and Richard H. Dolan are partners at Schlam Stone & Dolan.