# United Stat es Court of Appeals For the First C ircuit

No. 02-1281 UNITED STATES OF AMERICA, Appellee,

v. THOMAS RONALD THEODORE, Defendant, Appellant.

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS (Hon. Reginald C. Lindsay, U.S. District Judge )

Before Selya, Circuit Judge , Coffin, Senior Circuit Judge , and Stahl, Senior Circuit Judge .

RaymondJ. Rigat , with whom Gilbride & Rigat was on brief for Defendant-Appellant. Paul G. Levenson , Assistant United States Attorney, with whom Michael J. Sullivan , United States Att orne y, and Adam J. Bookbinder , Assistant United States Attorney, were on brief for Appellee.

December 12, 2003-2- STAHL, Senior Circuit Judge . Defendant-appellant Thomas RonaldTheodore appeals from his con victio n and sentence on nine counts of mail fraud, in violation of 19 U.S.C. § 1341, and three counts of violat ing t he Food Drug and Cosmetic Act, 21 U.S.C. §§ 331(a), (d), & (p). He contends that the district court erred: (1) when it denied defense counsel's motion to withdraw and request for

a continuance; (2) when it did not declare mid-trial a mistrial sua sponte ; (3) when it did not conduct an evidentiary hearing on Theodore's post-trial motion for a new trial and denied his motion for a new trial based on ineffective assistance of counsel; and (4) when it ordered restitution to victims without holding an evidentiary hearing. Because this case presents serious claims of ineffective assistance of counsel, we remand for an evidentiary hearing on Theodore's post-trial motion for a new trial based on ineffective assistance.

We note that the almost universal rule in these cases is that petitioners cannot raise ineffective assistance of c ounsel claims for the first time on direct review, the concern being that there is often no opportunity to develop th e n ecessary evidence where the claim is first raised on direct appeal. See Ellis v. UnitedStates , 313 F.3d 636, 652 (1st Cir. 2002); United States v. Knight , 37 F.3d 769, 774 (1st Cir. 1994); United States v. Jadusingh , 12 F.3d 1162, 1169-70 (1st Cir.1994); United States v. Mala , 7 F.3d 1058, 1063 (1st Cir.1993) , cert. denied , 511 U.S. 1086-3-

(1994). This rule does not apply in thi s in stance because the recordhere is sufficiently developed t o warrant further

c onsideration of the previously raised issue of ineffect iv e assistance of counsel as the entirety of the appeal revolves around the question of whether Theodore's counsel was ineffective within the strictures of Stricklandv. Washington , 46 6 U.S. 668 (1984). See United States v. Sotomayor-Vazquez , 249 F.3d 1, 13 (1st Cir. 2001); United States v. Ademaj , 170 F.3d 58, 64 (1st Cir.), cert. denied , 528 U.S. 887 (1999) .

Here, we have a series of claims impli cati ng the effectiveness of counsel and enough indicia of ineffectiveness to warrant remanding for an evidentiary hearing on Theodore's motion for new trial. We stress that we are not deciding whether the totality of the circumstances in this case amounts to ineffective assistance. Rather, we remand to the district court where it can determine in the first instance whether defense counsel's total performance was such that a new trial is warranted. I. BACKGROUND

Fr om 1 992 until approximately April 1995, Theodore and Thomas Rodgers, Jr. solicited about $1.6 million of investments in

a company called Private Biologicals Corporation (PBC) by claiming that they had inv ented a promising new drug called "LK-200." Investors were told that, because th e drug was not FDA-approved,-4-

PBC had manufactured it overseas using a proprietary production method. In actuality, "LK-200" was not "proprietary." As a subject of medical research, the substance and the methods for making it had been well-known for years and produced by researchers at the University of Pennsylvania. None of PBC's product was made

overseas but instead was produced in a manufacturing facility that Theodore had set up in Woburn, Massachusetts. Over the course of three years, Theodore and Rodgers, in addition to mi slea ding investors about the claimed invent io n and overseas operation, manufacturedLK-20 0 in sub-standard conditions that exposed the product to contamination. At the same time, Theodore misrepresented himself as a medical doctor.

On April 6, 2000, a federal grand jury returned a fourteen-count indictment against Theodore for conspiracy, mail fraud, and violations of the Food Drug and Cosmetic Act. Theodore

was represented by a series of attorneys throughout the pro ceedings. The first was John Bonistalli, who represent e d Theodore at his initial appearance on January 24, 2000. On April 11, 2000, John Noonan, now acting as Theodore's counsel, filed a motion for another attorney, Gordon White, to appear pro hac vice

as co-counsel. White, a Texas-based atto rne y, and Noonan filed several motions on Theodore's behalf and on October 23, 2000, both attorneys appeared at an evidentiary hearing on one of the motions,-5-

a motion to dismiss based on an implied promise of immunity. White

was the only one to actively participate in that hearing. This was the last time the record reflects the presence of White on behalf of Theodore, despite the fact that Theodore was soon to undergo a fifteen-day trial on the underlying criminal charges. The record indicates that until White disappeared from the scene, Noonan's role was simply that of local counsel.

At a February 1, 2001 pretrial conference, Noonan for the first time appeared as Theodore's sole counsel. The district court set the trial back a week and denied several of Theodore's pretrial motions as untimely. At this hearing, it was apparently made clear that White would no longer be representing Theodore, despite never havin g form ally withdrawn his appearance. In response to the district court's determination that th e pretrial motions were untimely, Noonan explained that "Mr. White is supposedly an expert in federal courts and was supposed to handle all these things." Towards the end of the conference, the court inquired into Noonan's

com fort with representing Theodore in federal court. Noon a n respondedthat he was concerned that there might be a Sixth Amendment problem, admitting that he was "very uncomfortable." It

was Noonan's fir st trial i n federal court in his forty years of practice. At a subsequent conference on February 2, 2001, Theodore stated that he did not want Noonan to represent him and that from-6-

the start, Noonan had told him that he was not competent to try the

case. He movedto replace counsel. The government countered that it had dealt with Noonan since the beginning of the case, that he hadalways seemed familiar with the case, and that he had had an opportunity to review the local procedural rules. The court denied Theodore's motion and instead appointed Dennis Kelly, a lawy er experiencedin handling federal criminal cases, as standby counsel to advise Noonan about federal procedure. Theodore reiterated his objection to having Noonan as his counsel.

On the first day of trial, February 12, 2001, Noonan fileda motion to withdraw as Theodore's counsel and requested a continuance so that another attorne y coul d be appointed. The court , howe ver, denied the motion and ruled that Noonan would continue to represent Theodore.

During Noonan's opening statement at trial, the district court sustained two objections made by the government. Throughout trial, his attempts at cross-examination were riddled with

sus tainedobjections for relevance and assuming facts not i n evidence. Nine days into trial, the district court received a note from a juror named Babchak inquiring about the possibility of the government offer ing Theodore a plea bargain. The court brought Babchak into chambers and asked about the note. Babchak responded, "I'mwondering if the defendant is being properly represented." The court then interviewed each juror. Two jurors, Moynihan and-7-

Birch, stated that they could no longer remain open-minded about Theodore's guilt. Birch expressed his belief th at Theodore was being inadequately represented. Noonan resp onde d that he agreed wi th Birch and that his inadequate performance was "really a fundamental problem all the way through here." The court removed these two jurors, but not Babchak.

On the tenth day of trial, Noonan informed the court that he had thirteen witnesses to call. As it turned out, the only witness that he actually attempted to call succeeded in having his subpoena quashed, as Noonan had failedto follow federal procedure. Noonan took no steps to oppo se th e motion to quash the subpoena,

nor did he appear at the hearing. The reaf ter, Noonan told the court that he had no witnesses to present to the jury. The government, apparently concerned, requested the court to instruct Theodore that he had a right to call witnesses. Fin ally, during Noonan's closing a rgument, the court sustained eight objections made by the government, again due to his commentary on facts not in evidence. Theodore was convicted of every charge in the indictment. For sentencing and post-trial motions, new counsel was appointed to represent Theodore. Together with his motion for a new trial, Theodore presented an affidavit from Noonan stating that he had a drinking problem that resurfaced during Theodore's trial and that he had not examined thousands of pages of evidence disclosedby the-8-

govern ment. Noonan also indicated that contrary to his pretrial representations to the court, he had never represented a defendant accusedof murder. Theodore requested an ev identi ary hearing on the new trial motion. The court denied his request as well as the motion. Theodore was ultimately sentenced to 121 months in prison andordered to pay $1,535,240.00 in restitutio n to t he defrauded investors. II. DISCUSSION A. Noonan's Motion to Withdraw

We review for abuse of d iscretion the district court's denial of defense counsel's motion to withdraw and request for a continuance. See United States v. Woodard , 291 F.3d 95, 106 (1st Cir. 2002). We accord "'extraordinary deference'" to the district court's decision when "allowance of the motion would necessitate a last-minute continuance." Id. at 107. "Only an unreasoning and arbitrary insistence upo n ex peditiousness in the face of a justifiable request for delay violates the right to the assistance of counsel." Id. at 106 (citation omitted).

Though we do not address the merits of Theodore's ineffective assistance claim under Strickland , it is important to set out the constitutional standard for such claims. To successf ully claim ineffective assistance of counsel under the Sixth Amendment, a defendant must es tabl ish that his counsel's performance fell below an objective standard of reasonableness and-9-

"that there was a reasonable probability that, but for counsel's unprofessional errors, the results of the proceeding would have been different." Strickland , 466 U.S. at 687-94.

The government argues that Noonan and Theodore nev e r intendedto make their claim of inadequate representation until the district court inquired into Noonan's comfort in trying the case, and that the motion was a "patent attempt to parlay the district court's solicitude into some advantage for" Theodore. It contends that Noonan seemed prepared to represent Theodore and that the district court's compromise of appointing Kelly as standby counsel compensated for Noonan's lack of experience in federal court.

Theodore responds that up to the point of his motion to withdraw, Noonan utterly failed to develop and present a defense. Counsel had not filed any subs tan tive pre-trial motions and had several procedural motions denied as untimely. On the other hand, Noonan did say to the district court that he "did a ll the preliminary work that needs to be done." He met with prosecutors to discuss the trial, came to the U.S. Attorney's Office to review documents, and produced documents and marked exhibits that he apparently intended to use at trial.

As replacing defense counsel so close to the beginning of trial is a measure appropriate for only the most extraordinary circumstances, we cannot hold that t he dis trict court abused its discretion when it crafted a compromise solution and denied-10-

Noonan's motion to substitute counsel. The court's accommodation

o f Noonan's claimed unfamiliarity with federal procedu re wa s reasonable under the circumstances and satisfied Theodore's Sixth Amendment right to effective assistance. See United States v. Nivica , 887 F.2d1110, 1121 (1st Cir. 1989); see also Woodard , 291 F.3dat 106 (the Sixth Amendment "does not provide an absolute right to counsel of a defendant's choosing"). The fact that Kelly provedto be available for only seven out of the fifteen trial days is another matter, better dealt with in connection with Theodore's motion for a new trial.

Given the deferent ial standard of review, we hold that the district court did not abuse i ts discretion when denying Noonan's motion to withdraw and request for a continuance. B. Mistrial Sua Sponte

We review the district court's decision not to declare a mistrial sua sponte for plain error. See United States v. Smith , 101 F.3d 202, 212 (1st Cir. 1996). A mist ria l is declared in a

cr iminal case only when manifest necessity requires it. S e e Illinois v. Somerville , 410 U.S. 458, 462 (1973).

Theodore claims that when the jurors expressed concerns about Noonan's performance as counsel, manifest necessity required the district court to declare a mistrial, even if Noonan failed to

move for one. Theodore further argues that the jurors' concerns

were yet another indication that Theodore effectively "had no-11-

representation throughout all phases of the trial." Though Noonan's performance was concededly less than stellar, it did not amount to "no representation"--Noonan still cond ucted voir dire, presented opening and closing statements, objected to prosecution evidence, cross-examined witnesses, offered evidence on Theodore's behalf, and requested jury instructions.

Moreover, the court took steps to address the jurors'

concerns about Noonan's representation by suspending the trial and questioning each juror individually about the memo. When two of the jurors admitted that they could no longer be impartial, the court excused them and replaced them with alternates. It was not plain error for the court to conclude, despite the jurors' concerns andNoonan's performance thus far, that the trial couldgo on after it had taken measures to investigate and remedy those concerns. By declaring a mistrial sua sponte under such circumstances, the court wouldhave impos ed on Theodore its view of counsel's performance anddeprived him of "his option to go to the jury first, and, perhaps, endthe dispute then and there with an acquittal." United States v. Jorn , 400 U.S. 470, 484 (1971). Again, given the very high standard of review, we decline to find plain error. C. Post-Trial Motion for a New Trial and Evidentiary Hearing

We review the district court's denial of an evidentiary hearing for an abuse of discretion. See United States v. Alicea , 205 F.3d 480, 487 (1st Cir. 2000). The pa r ty seeking an-12-

evidentiary hearing on a motion for a new trial must make "a sufficient threshold showing that material facts [are] in doubt or dispute ." Id. ( citing United States v. Panitz , 907 F.2d 1267, 1273 (1st Cir. 1990)).

Theodore sought an evidentiary hearing to address

concerns about Noonan's veracity and how previous misrepresentations by Noonan to the court might bear on Theodore's ineffective assist ance claim. In particular, he produced an affidavit submitted by Noonan admitting that he had misrepresented his past trial experience to the court. A determination of Noonan's credibili ty bears on the issue of whether the district court might have handled Theodore's (and Noonan's) repeated claims of ineffective assistance differently, and ultimately whether Theodore satisfied Strickland .

Similarly, revelations of Noonan's alcohol abuse during trial and failure even to glance at volumes of government evidence bear strongly on factual issues of Noonan's overall competency and performance. We already know that Noonan failed to appear at the hearing held on the motion to qu ash made by the only defense witness subpoenaed for trial, not due to any tactical choice, but because of negligence and his utter ignorance of federal procedure despite the availability of standby counsel. The same goes for the several pre-trial motions denied as untimely by the district court. Andthough a finding of "no representation" is reserved only for1 We caution, how ever, that prejudice may be presumed only in

three narrowly circumscribed situa tio ns: "First, a trial is presumptively unfair if the accused is completely deni ed the presence of counsel at a critical stage of the proceedings. Second, such a presumption is warranted if counsel entirely fails to subject the prosecution's case to meaningful a dve rsarial testing. Third, prejudice may be presumed in the presence of circumstances under which a c ompete nt lawyer would likely not be able to render effective assistance." Ouber v. Guarino , 293 F.3d 19, 33 (1st Cir. 2002) (internal citations and quotation marks omitted). -13- the most extreme cases of ineffective assistance, facts adducedat the hearing may lend some support to Theodore's claim that he was constructively abandoned by his co unse l throughout trial. See United States v. Cronic , 466 U.S. 650, 659 (1984). 1

The government's contention that Theodore failed to satisfy Stricklandin his request for an evidentiary hearing misses the thrust of the request. Indeed, the poin t of an ev identiary hearing would be to consider evidence upon which a new trial might be ordered pursuant to Strickland . Where a defendant "[provide]s adequate factual specification beyond bald speculation," an evidentiary hearing is warranted. United States v. Rodriguez Rodriguez , 929 F.2d 747, 752 (1st Cir. 1991). Theodore's claims of ineffective assistance before and throughout trial already present close cases--the addition of N oona n's affidavits post-trial make thi s case all the more unusual and troubling. As the distri c t court itse lf e xpressed concerns regarding Noonan's veracity upon considering Theodore's new trial motion, w e h old that the court abusedits discretion by not holding an evidentiary hearing to2 In the event the district court orders a n ew t rial, the

restitution order becomes moot.-14- resolve or clarify factual issues ultimately crucial to Theodore's claimof ineffective assistance of counsel. We leave to the district court the determination of whether a new trial should be gr anted, taking into account what happened at trial and whatever evidence is adduced at the hearing. D. Restitution Order 2

As Theodore never requested an evidentiary hearing regarding the question of victim restitution, we review the district court's decision for plain error. See Johnson v. United States , 520 U.S. 461, 467 (1997). We review the restitution order itself for an abuse of discretion and subsidiary factual findings for clear error. See United States v. Vaknin , 112 F.3d 579, 586 (1st Cir. 1997).

Theodo re ar gues that without a hearing, the district court had no evidentiary basis on which to make a fair and reasoned restitution order. We disagree and find that the evidence at trial

as well as the Pre-Sente nce Report (PSR) provided sufficient support for the court's order.

The PSR set forth a schedule of victims and the amount of restitution owed to each. Moreover, Gary Coulter, who had served

as counsel to PBC, identified a contemporaneous schedule of investor s' co ntributions, which detailed the identities of the3 Under 18 U.S.C. § 3663(a)(1)(B)(i), the court, in determining

whether to order restitution, must consider: (I) the amount of the loss sustained by each victim as a result of the offense; and (II) the financial resources of the defendant, the financial needs and earning ability of the defendant and the defendant's dependents, and such other factors as the court deems appropriate. -15- investors, the amounts they invested in the company, and the dates on which they did so. In his only objection to the PSR, Theodore statedthat he never solicited, raised, or received any funds on behalf of PBC or for the production and distribution of LK-200. Evidence at trial, however, showed that though others may have playedleading roles in PBC's financial operat ions , Theodore was integral to the initiation of the fraudulent scheme and was directly responsible for the key falsehoods upon which the scheme rested. We have noted that

restitution for all criminal conduct done in the course of a single scheme, conspiracy, or pattern of activity is now appropriate, whether or not the defendant has been convictedof (or even charged with) the specific acts, as long as the offense of conviction has an element in the broader scheme, conspiracy, or pattern. Vaknin , 112 F.3d at 582 n.1. Though Theodore may not have been implicatedin each and every step of the fraudulent scheme, what

was proved at trial is more than enough for purposes of finding him liable for the amount in the restitution order.

Theodore also claims that without an evidentiary hearing, the district court could not have determinedwhether Theodore would be able to pay restitution. 3 The record, however, refl ects that-16-

the court was aware of Theodore's financial status and considered it in fashioning the order. The court provided for installment payments in the event that immediate payment of the entire amount provedimpossible. It also determined that he did not have to pay interest. Finally, it c hose not to impose a fine. It is enough that the court "made implicit findings or otherwise adeq uate ly evinced[its] consideration" of Theodore's ability to pay. United States v. Savoie , 985 F.2d 612, 618 (1st Cir. 1993).

We therefore affirm th e di strict court with respect to (1) its denial of Noonan's motion to withdraw and reques t for a continuance, (2) its decision not to declare a mistrial sua sponte , and(3) its restitution order. We vacate the district court's order denying Theodore's motion for a new trial based on ineffective assistance of coun s el and remand for further proceedings consistent with this opinion.