Opinion ID: 2800048
Heading Depth: 2
Heading Rank: 3

Heading: Kiley’s Trial Attorney

Text: At the district court, Kiley retained attorney H. Nasif Mahmoud to represent him. Kiley now asserts he was denied his Sixth Amendment right to competent assistance of counsel at trial because “Mahmoud labored under multiple conflicts of interest while representing” Kiley. Kiley also argues the district court’s failure to address the conflicts violated his Fifth Amendment right to Due Process. Count 23 in the indictment (Count 17 in the original indictment) charged that on July 7, 2009, Kiley engaged in money laundering via a “[w]ire transfer of $100,000.00 from the Basel Group, LLC, bank account at Associated Bank to the account of an attorney.” Well before trial, in a “motion for inquiry,” the government apprised the district court that the attorney cited in Count 23 was Kiley’s attorney, Mahmoud. The government advised the district court (1) Mahmoud might be a necessary witness because he attended meetings and purportedly stayed at the mansion where the schemers conducted the business of the currency program for as much as three weeks in July 2009; (2) during that time, Cook told Mahmoud that Cook initiated the Count 23 wire transfer, not Kiley; (3) Mahmoud currently represented “Individual A,” who would “certainly” be called as a trial witness; and (4) Mahmoud formerly represented “Individual B,” a “likely” government witness. The government advised the district court to explore the potential conflict issues in order to ensure Kiley’s Sixth Amendment right to counsel was protected. In a strong response to the government’s motion, Kiley stated Mahmoud was “not a necessary witness” because other attorneys were present at the meetings, and they could testify rather than Mahmoud. Kiley stated the government’s motion was “a transparent attempt to prevent Kiley from securing the attorney of his choice” and on five occasions suggested the district court “consider sanctions against the -26- government.” Although Kiley was also represented by a local attorney, David Zins, Kiley suggested disqualifying Mahmoud would result in hardship because Zins was less experienced and knew less about the case than Mahmoud. Kiley also stated Individual A was not a necessary witness because he was “the wrong witness” and Mahmoud had represented “Individual B on a one time basis” “years before.” Kiley went so far as to suggest the money-laundering count was included in the indictment in “an effort to keep Kiley’s present defense counsel [Mahmoud] from representing Kiley.” A magistrate judge granted the government’s motion for inquiry and heard argument on the matter. At the hearing, after explanation by the magistrate judge, Kiley waived his rights as to any conflict with Individual A, Steve Nortier, and Individual B, Thietje. Also at the hearing, Kiley personally volunteered, “I have the utmost confidence in Mr. Mahmoud in many areas. His veracity, his commitment.” Kiley expressly “waive[d] any potential conflict of interest” and declared, “I want to keep Mr. Mahmoud.” After the hearing, Kiley filed written “waivers of potential conflicts of interest” as to Nortier and Thietje. The magistrate judge recommended Mahmoud not be disqualified because of Kiley’s waivers and because Mahmoud was not a necessary witness, and the district court agreed. Kiley now argues the district court erred by not considering the conflict inherent in Count 23 itself—that Kiley was convicted of a crime that implicated his attorney, Mahmoud. This potential conflict was not raised by the government in its motion for inquiry, nor raised by Kiley at the magistrate judge’s hearing, nor addressed by the magistrate judge or the district court before trial. At trial, several witnesses testified as to Mahmoud’s receipt of the charged wire transfer. Mahmoud asked a witness about it himself, referring to himself in the first person—Mahmoud asked Kiley’s administrative assistant, “In July of 2009, about the time you sent that -27- wire to me, what was [Kiley’s] condition from what you observed when he learned of the fraud?” Kiley now suggests the potential conflict regarding Count 23 was (1) so obvious the district court should have investigated the matter whether or not Mahmoud raised it on Kiley’s behalf, and (2) so grave it violated Kiley’s Fifth Amendment right to due process. “Where a constitutional right to counsel exists, our Sixth Amendment cases hold that there is a correlative right to representation that is free from conflicts of interest.” Wood v. Georgia, 450 U.S. 261, 271, 272-73 (1981) (vacating and remanding on due process grounds where defendants “were represented by their employer’s lawyer,” and “[a]ny doubt as to whether the court should have been aware of the problem [wa]s dispelled by the fact that the State raised the conflict problem explicitly and requested that the court look into it”). In the context of an assertion of ineffective counsel due to multiple representation of co-defendants in state court, trial courts [must] investigate timely objections to multiple representation. But nothing in our precedents suggests that the Sixth Amendment requires state courts themselves to initiate inquiries into the propriety of multiple representation in every case. Defense counsel have an ethical obligation to avoid conflicting representations and to advise the court promptly when a conflict of interest arises during the course of trial. Absent special circumstances, therefore, trial courts may assume either that multiple representation entails no conflict or that the lawyer and his clients knowingly accept such risk of conflict as may exist. . . . [T]rial courts necessarily rely in large measure upon the good faith and good judgment of defense counsel. . . . Unless the trial court knows or reasonably should know that a particular conflict exists, the court need not initiate an inquiry. Cuyler v. Sullivan, 446 U.S. 335, 346-47 (1980) (footnotes omitted). Nevertheless, as we have stated, -28- The Supreme Court [has rejected the] argument that, where the trial judge has failed to make a Sullivan-type inquiry notwithstanding an apparent attorney conflict of interest, reversal is automatic regardless of whether the conflict affected the attorney’s performance. . . . The Supreme Court [has] concluded that, where the trial court knew or reasonably should have known about a potential attorney conflict of interest and yet failed to make an inquiry, the petitioner, in order to void the conviction, must show that the conflict of interest had an adverse effect on his or her counsel’s performance. Koste v. Dormire, 345 F.3d 974, 975, 981-82 (8th Cir. 2003) (citing Mickens v. Taylor, 535 U.S. 162, 172-74 (2002)) (reviewing a petition for relief under 28 U.S.C. § 2254 asserting a conflict that did not involve multiple representation); see also Ausler v. United States, 545 F.3d 1101, 1102, 1104 (8th Cir. 2008) (reviewing a motion for relief under 28 U.S.C. § 2255 that did not involve multiple representation and stating, “[I]n cases involving a [district court’s] failure to inquire into . . . potential conflicts [other than one attorney representing co-defendants, a] defendant [must] show that ‘a conflict of interest actually affected the adequacy of’” his attorney’s representation, as opposed to “Strickland prejudice” (quoting Mickens, 535 U.S. at 170-71 & nn.3, 4)).14 In this case, the district court relied on (1) Mahmoud’s assurance that no conflict existed and his adamant response to the government’s motion for inquiry and (2) Kiley’s clear statement to the magistrate judge he wanted Mahmoud to represent him—“I want to keep Mr. Mahmoud.” See Powell v. Alabama, 287 U.S. 45, 53 (1932) (“It is hardly necessary to say that the right to counsel being conceded, a 14 To the extent later cases conflict with Ausler, see, e.g., Noe v. United States, 601 F.3d 784, 790 (8th Cir. 2010) (“[W]e have not yet determined whether [Sullivan’s] presumed prejudice analysis extends beyond conflicts arising from multiple representation.”), we must follow the earliest opinion, Ausler. See Mader v. United States, 654 F.3d 794, 800 (8th Cir. 2011) (en banc) (explaining we are bound by prior panel opinions). -29- defendant should be afforded a fair opportunity to secure counsel of his own choice.”). Unlike Wood, the government’s motion for inquiry did not apprise the district court of the Count 23 issue Kiley now raises. We therefore reject Kiley’s due process challenge raised under the Fifth Amendment, and we find the district court was not required to address sua sponte the potential Count 23 conflict in the midst of this complex and lengthy trial. As to Kiley’s ineffective-assistance challenge, the district court has not heard argument on the alleged inherent conflict in Count 23. Because Kiley “must show that the” alleged “conflict of interest had an adverse effect on” Mahmoud’s performance, Koste, 345 F.3d at 981, and the district court has not passed on this issue, we decline to address it on direct appeal in the first instance. Cf. United States v. Hubbard, 638 F.3d 866, 869 (8th Cir. 2011) (“‘We will consider ineffectiveassistance claims on direct appeal only where the record has been fully developed, where not to act would amount to a plain miscarriage of justice, or where counsel’s error is readily apparent.’” (quoting United States v. Ramirez-Hernandez, 449 F.3d 824, 827 (8th Cir. 2006))); United States v. McAdory, 501 F.3d 868, 872-73 (8th Cir. 2007) (stating ineffective-assistance claims are ordinarily deferred to 28 U.S.C. § 2255 proceedings). Whether the alleged Count 23 conflict resulted in ineffective assistance by Mahmoud is more appropriately addressed in a § 2255 proceeding with the benefit of the fact-finding and appraisal by the trial judge, who is in a better position to assess Mahmoud’s performance.