Opinion ID: 778643
Heading Depth: 2
Heading Rank: 1

Heading: Statute of Limitations Over Conspiracy Count

Text: 25 Count Two charged St. Germain with conspiring to engage in monetary transactions of criminally derived property in violation of 18 U.S.C. § 1956(h)(2001). The statute of limitations for actions brought under § 1956(h) is five years. 18 U.S.C. § 3282 (2000). 26 In order for the conspiracy charge alleged in Count Two to fall within the statute of limitations, (1) the conspiracy must still have been ongoing within the five year period preceding the indictment, and (2) `at least one overt act in furtherance of the conspiratorial agreement [must have been] performed within that period.' United States v. Ben Zvi, 242 F.3d 89, 97 (2d Cir.2001) (quoting Grunewald v. United States, 353 U.S. 391, 396-97, 77 S.Ct. 963, 1 L.Ed.2d 931 (1957)) (alteration in original). 2 In this case, the superseding indictment was returned on July 26, 2000. Therefore, for the conspiracy charge in Count Two to have fallen within the statute of limitations, the conspiracy must have continued until at least July 26, 1995. 27 [T]he crucial question in determining whether the statute of limitations has run is the scope of the conspiratorial agreement, for it is that which determines both the duration of the conspiracy, and whether the act relied on as an overt act may properly be regarded as in furtherance of the conspiracy. Grunewald, 353 U.S. at 397, 77 S.Ct. 963. St. Germain argues that the scope of the conspiracy was limited to putting St. Germain's share of the Cerplex proceeds into his control. Therefore, according to St. Germain, the conspiracy was complete and the last possible overt act committed on July 6, 1994, when Elkins sold his last share of Papago Place to Papago Place L.L.C., a company controlled by St. Germain. 28 The government argues that the conspiracy continued into 1998 when St. Germain sold Papago Place. According to the government, the scope of the conspiracy included any monetary transactions made by the conspirators with the Cerplex money. Thus, the government argues that two acts alleged in the indictment — St. Germain's withdrawal of approximately $118,000 from a certificate of deposit in March 1996 and the sale of Papago Place in 1998 — as well as several additional acts proven at trial bring Count Two within the statute of limitations. 29 We reject St. Germain's characterization of the scope of the conspiracy because it is unduly narrow, but we do not fully embrace the government's position. The government's reading of the scope of the conspiracy to include any monetary transactions made by the conspirators with the Cerplex money is overbroad. We do agree with the government's conclusion that the 1996 and 1998 transactions fell within the scope of the conspiracy because the conspirators did not receive their anticipated economic benefits from the conspiracy until the 1998 sale of Papago Place. The conspiracy continued at least until then, well within the limitations period. 30 A conspiracy involves an agreement by at least two parties to achieve a particular illegal end. United States v. Stavroulakis, 952 F.2d 686, 690 (2d Cir.1992). In order for a defendant to be convicted of conspiracy, there must be proof beyond a reasonable doubt that [the conspirators] agreed on the `essential nature of the plan.' Id. (quoting Blumenthal v. United States, 332 U.S. 539, 557, 68 S.Ct. 248, 92 L.Ed. 154 (1947)). We therefore focus on the essence of the underlying illegal objective to determine the scope of the conspiracy. Id. 31 St. Germain was convicted under 18 U.S.C. § 1956(h) of conspiring to engage in monetary transactions in violation of 18 U.S.C. § 1957(a). Section 1957 makes it a crime to knowingly engage[] or attempt[] to engage in a monetary transaction in criminally derived property of a value greater than $10,000 [that] is derived from specified unlawful activity. 18 U.S.C. § 1957(a) (2001). The illegal objective of a conspiracy to engage in monetary transactions in violation of § 1957(a) is the monetary transaction involving unlawfully obtained property, not the underlying act of unlawfully obtaining it. See Stavroulakis 952 F.2d at 691; United States v. Holmes, 44 F.3d 1150, 1154 (2d Cir.1995). Therefore, because the monetary transaction is the illegal objective, a conspiracy to engage in such transactions continues as long as one or more conspirators engages in monetary transactions as contemplated by the conspiratorial agreement. 32 St. Germain argues persuasively that construing the conspiracy to continue as long as one conspirator engages in any monetary transactions involving the criminally derived property, irrespective of whether the transactions are intended to further the initial aims of the conspiracy, results in an indeterminate extension of the statute of limitations. The Supreme Court has warned that it view[s] with disfavor attempts to broaden the already pervasive and wide-sweeping nets of conspiracy prosecutions. Grunewald, 353 U.S. at 404, 77 S.Ct. 963. The Court has further instructed that in determining whether the statute of limitations has run, we should analyze the scope of the conspiratorial agreement, for it is that which determines both the duration of the conspiracy, and whether the act relied on as an overt act may properly be regarded as in furtherance of the conspiracy. Id. at 397, 77 S.Ct. 963. Accordingly, the conspirators' purpose or intent informs the scope of the conspiracy. Otherwise, a conspiracy knowingly to engage in monetary transactions in criminally derived property, 18 U.S.C. § 1957(a), would be an indefinitely continuing offense with an indeterminate statute of limitations, Krulewitch v. United States 336 U.S. 440, 456, 69 S.Ct. 716, 93 L.Ed. 790 (1949) (Jackson, J., concurring). 33 The government argues that our holding in United States v. Monaco, 194 F.3d 381 (2d Cir.1999), supports the proposition that the scope of a conspiracy includes any transaction involving the criminally derived property. We disagree. In Monaco, we noted that a conspiracy to launder proceeds from drug trafficking and piracy was within the statute of limitations even though the monetary transactions in furtherance of the laundering conspiracy were made as many as twelve years after the drug trafficking and piracy ended. Id., 194 F.3d at 387 n. 2. The Monaco defendants continued until then to commit acts in furtherance of their conspiracy to conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity, id. at 386 (quoting 18 U.S.C. § 1956(a)(1)(B)(I)), viz., drug trafficking and piracy. Contrary to the government's reading of Monaco, the monetary transactions were not deemed to be within the scope of the conspiracy simply because they involved the drug trafficking and piracy proceeds. The transactions were deemed part of the conspiracy because they furthered the original aims of the conspiracy, to conceal and disguise the nature, source, the ownership or control of the proceeds. Monaco, therefore, like Krulewitch and Grunewald, analyzed the aims of the conspiracy to determine whether a specific act fell within its scope. 34 But we disagree with St. Germain's alternative and unduly narrow characterization of the scope of the conspiracy as limited to putting St. Germain's share of the Cerplex proceeds into his control. Where the object of a conspiracy is economic, the conspiracy generally continues until the conspirators receive their anticipated economic benefits. United States v. Mennuti, 679 F.2d 1032, 1035 (2d Cir.1982); accord id. at 1035-36 (collecting cases for the same proposition). If the conspirators received their anticipated economic benefits after placing St. Germain's share of the proceeds within his control, then that placement did not end the conspiracy. 35 We need not speculate about the outer limits of the conspiratorial agreement to conclude that both the 1996 withdrawal from the certificate of deposit and the 1998 sale of Papago Place were within the scope of the conspiracy. 36 The trial court found proof beyond a reasonable doubt that St. Germain conspired with Schultz and Elkins to engage in a series of monetary transactions with the money derived from the Cerplex scheme. The scheme began with Schultz and Elkins receiving money from business that St. Germain steered to Cerplex. Schultz and Elkins then kicked portions of their commissions back to St. Germain. In an effort to hide the kickback scheme, St. Germain, Schultz, and Elkins used the Cerplex money in several monetary transactions between 1992 and 1998. In 1992, Elkins, acting as a strawman for St. Germain, used part of St. Germain's proceeds from the Cerplex scheme to purchase Papago Place. In 1993 and 1994, St. Germain used several shell companies to engage in monetary transactions with proceeds from the Cerplex scheme. In 1994, Elkins used Cerplex money to pay off the mortgage on Papago Place and subsequently transferred complete title to St. Germain through Papago Place L.L.C. In March 1996, St. Germain withdrew approximately $118,000 from a certificate of deposit he had established with Cerplex proceeds in 1994. Finally, in August 1998, St. Germain caused Papago Place L.L.C. to sell Papago Place, resulting in a wire transfer of approximately $1.7 million into the account of Papago Place L.L.C. Thus, St. Germain and Schultz did not receive their anticipated economic benefits as contemplated by the conspiratorial agreement until the sale of Papago Place. The conspiracy was therefore ongoing until at least 1998 when Papago Place was sold. 37 St. Germain argues that the withdrawal from the certificate of deposit and the wire transfer from the sale of Papago Place were not transactions contemplated by the conspiratorial agreement because he acted alone in making these transactions. However, while conspirators must agree on the `essential nature' of the conspiracy, they need not agree on every detail of their venture. Stavroulakis, 952 F.2d at 690 (noting that [t]he policies underlying conspiratorial liability could easily be thwarted by the careful compartmentalization of information, and `conspirators would go free by their very ingenuity,' if it were required that they agree on all details of the scheme (quoting Blumenthal, 332 U.S. at 557, 68 S.Ct. 248)). The conspirators had agreed to launder the proceeds of the scheme. They did not have to agree further on the details of each transaction in furtherance of that objective. 38 Moreover, the 1996 and 1998 transactions were part of a series of transactions made throughout the life of the conspiracy and thus part of a single ongoing agreement. First, the money withdrawn in 1996 was Cerplex commission money that St. Germain placed in a certificate of deposit in 1994 under the name of a shell company created to carry out the sham commission agreement with Schultz. Second, Papago Place had originally been bought to disguise St. Germain's involvement in the Cerplex scheme. Several monetary transactions resulted from the purchase, ending with the sale of the property in 1998. At the time Papago Place was sold, St. Germain and Schultz were still co-owners of the property, thus demonstrating the conspirators' continued involvement with the Cerplex money and with each other. Therefore, the 1996 and 1998 transactions were contemplated by the conspiratorial agreement and demonstrate that the conspiracy was ongoing as late as 1998. 39 In addition to establishing the continued existence of the conspiracy, the 1996 and 1998 transactions qualify as overt acts in furtherance of the conspiracy, assuming such overt acts are required. See footnote 2, supra. To constitute an overt act for purposes of the statute of limitations the act must involve some affirmative conduct or deliberate omission on the part of [a conspirator]. Ben Zvi, 242 F.3d at 97. An overt act[] ... [is] meaningful only if [it is] within the scope of the conspiratorial agreement, Grunewald, 353 U.S. at 414, 77 S.Ct. 963, but an overt act may be made by only a single one of the conspirators and need not be itself a crime. Braverman v. United States, 317 U.S. 49, 53, 63 S.Ct. 99, 87 L.Ed. 23 (1942). 40 As discussed above, the withdrawal of Cerplex money in 1996 and the wire transfer from the sale of Papago Place in 1998 fell within the scope of the conspiracy. The transactions were part of a single continuing agreement and were made by St. Germain, a conspirator who had not withdrawn from the conspiracy. Therefore, the transactions were overt acts in furtherance of the conspiracy. 3 41 In summary, the conspiracy in this case continued at least until the conspirators received their anticipated economic benefits from the Cerplex scheme. Because the conspirators did not receive their anticipated economic benefits until the sale of Papago Place in 1998 and the government proved that the conspiracy continued at least until that date, Count Two was not barred by the statute of limitations.