Court Opinion

ID: 1019091
Source: CourtListenerOpinion
Date Created: 2013-07-04 22:30:22.641268+00
Date Added: 2024-06-11T15:37:49.421220
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UNPUBLISHED

                   UNITED STATES COURT OF APPEALS
                       FOR THE FOURTH CIRCUIT

                            No. 04-4794

UNITED STATES OF AMERICA,

                                             Plaintiff - Appellee,

          versus

MARSHALL NICHOLSON, SR.,

                                            Defendant - Appellant.

------------------------

UNITED STATES BANK NATIONAL ASSOCIATION,

                                                           Movant.

                            No. 04-4941

UNITED STATES OF AMERICA,

                                             Plaintiff - Appellee,

          versus

MARSHALL NICHOLSON, JR., a/k/a King,

                                            Defendant - Appellant.

-------------------------

UNITED STATES BANK NATIONAL ASSOCIATION,

                                                           Movant.
                             No. 04-4980

UNITED STATES OF AMERICA,

                                              Plaintiff - Appellee,

          versus

ROBERT EDWARD TURNER,

                                             Defendant - Appellant.

                             No. 05-4004

UNITED STATES OF AMERICA,

                                              Plaintiff - Appellee,

           versus

GLADYS PAYNE NICHOLSON, a/k/a Gladys Marie
Nicholson,

                                             Defendant - Appellant.

Appeals from the United States District Court for the District of
Maryland, at Greenbelt. Alexander Williams, Jr., District Judge.
(CR-03-268-AW)

Argued:   February 3, 2006                 Decided:   April 18, 2006

Before WILKINSON, LUTTIG, and MICHAEL, Circuit Judges.

                                  2
Affirmed by unpublished per curiam opinion. Judge Michael wrote an
opinion concurring in part and concurring in the judgment.

ARGUED: Hughie Duvall Hunt, II, KEMET & HUNT, P.L.L.C., College
Park, Maryland, for Appellants. Chan Park, Assistant United States
Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Greenbelt,
Maryland, for Appellee. ON BRIEF: Thomas J. Saunders, Baltimore,
Maryland, for Appellant Marshall Nicholson, Sr.; Michael S.
Blumenthal, Landover, Maryland, C. William Michaels, Baltimore,
Maryland, for Appellant Marshall Nicholson, Jr.; Allen H. Orenberg,
North Bethesda, Maryland, for Appellant Robert Edward Turner. Rod
J. Rosenstein, United States Attorney, Deborah Johnston, Assistant
United States Attorney, Patrick M. Pericak, Special Assistant
United States Attorney, Greenbelt, Maryland, for Appellee.

Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).

                                3
PER CURIAM:

       Defendants in this case appeal their convictions and sentences

arising out of a large operation to distribute drugs in Prince

George’s County, Maryland.            We conclude that their claims lack

merit, and affirm the judgment on all accounts.

                                        I.

       Defendants are Marshall Nicholson, Jr. (Nicholson, Jr.), his

father, Marshall Nicholson, Sr. (Nicholson, Sr.), his mother,

Gladys Payne Nicholson (Ms. Nicholson), and an associate, Robert

Edward Turner.        A grand jury indicted defendants on fourteen

counts, all of which stemmed from an investigation of a large-scale

drug distribution ring in Prince George’s County, Maryland. A jury

trial was held beginning on February 24, 2004, and it continued

over twenty-four days.

       The government introduced extensive evidence at trial, and we

merely    summarize     it    here.     The    evidence    demonstrated    that

Nicholson, Jr. had distributed a large amount of drugs since the

1980s, often from the home of his parents at 7533 Allendale Drive,

Palmer   Park,   Maryland     (the    Palmer   Park    home).     The   evidence

consisted of, inter alia, witness testimony, statements obtained

from    wiretaps,     and    physical   evidence      recovered   in    numerous

searches.    We will review each in turn.

                                        4
     Several witnesses testified as to Nicholson, Jr.’s drug-

related   activities.       Kenneth       Pickens,    for      example,    regularly

obtained a half-ounce to an ounce of crack from Nicholson, Jr.

every week beginning in 1997, for about six months to a year.                      Some

of these transactions took place at the Palmer Park home.                    As late

as January 2003, cooperating with law enforcement, Pickens bought

62 grams of crack from Nicholson, Jr. at the Palmer Park home.

     Patricia Tucker testified that she purchased 3.5 grams of

crack from Nicholson, Jr. about once a week between 1996 and 2000,

often at the Palmer Park home.          She and Alan Sarvis also testified

that they traveled to Los Angeles with Nicholson, Jr. to purchase

eight kilograms of powder cocaine in July 2001.                   Tucker took four

kilograms of cocaine in her suitcase, and returned to the Palmer

Park home, where the cocaine was unpacked.                     Sarvis and another

individual   hid   the    other    four       kilograms   on     their    bodies   and

returned to Maryland on July 29, 2001.               Law enforcement officers

intercepted them at the Baltimore-Washington International Airport,

and they were arrested.

     Jermaine Woodbury testified that he obtained 31 grams of crack

from Nicholson, Jr. in March or April 2000.               He further noted that

in March 2001, he had Nicholson, Jr. convert 125 grams of powder

cocaine   into   crack.     A     few   days     later,     he   also    arranged     a

transaction in which Nicholson, Jr. bought six kilograms of cocaine

                                          5
from another individual.     Woodbury further testified that on July

17, 2002, he purchased 62 grams of crack from Nicholson, Jr.

     Stephen Brown testified that he and Nicholson, Jr. often

collaborated in buying cocaine.         Brown facilitated a purchase in

1999 in which Nicholson, Jr. obtained a kilogram of cocaine.

Additionally, between September 2002 and June 2003, they bought

approximately 25 kilograms of cocaine from a source in California.

Nicholson, Jr. would convert the powder cocaine into crack and they

would then sell it.       Finally, Weldon Barnett testified that he

often obtained up to a half-kilogram of crack from Nicholson, Jr.

at the Palmer Park home beginning in 1998.             Several of these

witnesses testified that Nicholson, Sr. and Ms. Nicholson were in

the home when they obtained drugs from Nicholson, Jr.

     Ernest Cox, a longtime associate of Nicholson, Sr., testified

that during a visit with Nicholson, Sr. in March 2003, Nicholson,

Sr. asked him if he knew anyone who sold cocaine.            Cox asked how

much Nicholson, Sr. needed, and he responded that he would have to

ask his son.    Cox later located a potential source, and Nicholson,

Sr. stayed in contact with Cox to help his son arrange the purchase

of between five and ten kilograms of cocaine.               Nicholson, Jr.

eventually traveled to Texas and Mexico to discuss the sale of this

cocaine, but the transaction fell through.

     In addition to the multiple witnesses who testified, the

government     also   introduced   at    trial   numerous    tape-recorded

                                    6
conversations occurring between March and June 2003 that it had

obtained through the use of wiretaps. Law enforcement officers had

placed wiretaps on various phones, including several cell phones

used by Nicholson, Jr. and the phone at the Palmer Park home.

These wiretaps revealed that Nicholson, Jr. would call Nicholson,

Sr. to discuss who had come by the home and who had left messages

for him.   According to law enforcement officers, father and son

talked in code about drug distribution.

     Physical evidence was also recovered as a result of several

searches conducted on June 12, 2003, which marked the end of the

investigation.      After obtaining search warrants, law enforcement

officers searched several homes. At the Palmer Park home, officers

recovered a handgun, ammunition, and $85,339 in cash.             They also

searched defendant Turner’s residence, and found a handgun hidden

in a sofa in the basement. Officers located Nicholson, Jr.’s Dodge

pickup truck, and searched and seized it as well.               Among other

contraband, they found an RF detector, which detects body wires.

     Finally, the government presented evidence to show that Ms.

Nicholson had engaged in money laundering when she bought a home

with her son’s money.      On September 9, 1999, Ms. Nicholson closed

a deal with Raymond Procopio Builders to purchase a home located at

3220 Dunbratton Court, Waldorf, Maryland (the Waldorf home).            From

the financial records, it appears that the price of the home was

about   $500,000,    and   that   the   down   payment   was   approximately

                                        7
$23,000.    Nicholson, Jr. was present at the closing.          He later told

associates that he in fact had purchased the home, that he had put

down $100,000 on it, and that he had his mother place the home in

her name.   When the builder was later called to make repairs on the

home, he noted that Nicholson, Jr. was the only person present that

he knew.

       Detective Dennis Hallinger of the Prince George’s County

Police Department questioned Ms. Nicholson about her son and the

Waldorf home during the search of her own home conducted on June

12, 2003.       She said that she did not know what Nicholson, Jr. did

for a living and that she owned no other property other than the

Palmer Park home.       She refused to acknowledge that she had placed

the Waldorf home in her name, but did indicate she had done so for

her daughter-in-law’s home.           Ms. Nicholson had for several years

deducted mortgage interest she allegedly paid on the Waldorf home

from her taxable income on her tax returns.

       The jury returned its verdict on April 2, 2004.           It acquitted

defendants on some counts, but convicted each defendant on at least

one.   Nicholson, Jr. was convicted of numerous counts.              First, the

jury convicted him of conspiracy to distribute, inter alia, five

kilograms of cocaine and fifty grams of crack from 1999 to June 12,

2003, in violation of 21 U.S.C. § 846 (2000).                    He was also

convicted of possessing with intent to distribute five kilograms of

cocaine    on    July   29,   2001,   and   of   possessing   with   intent   to

                                        8
distribute fifty grams of cocaine base on July 17, 2002 and January

22, 2003, all in violation of 21 U.S.C. § 841.              Finally, he was

convicted of using a communication facility to further a drug

conspiracy, in violation of 21 U.S.C. § 843(b), and of a money

laundering conspiracy, in violation of 18 U.S.C. § 1956(h) (2000).

He was sentenced to a mandatory minimum of life imprisonment based

on the drug convictions.        See 21 U.S.C. § 841(b)(1)(A).

     The jury also convicted Nicholson, Sr. of conspiracy to

distribute drugs, and of using a communication facility to further

that conspiracy.       See 21 U.S.C. §§ 843(b), 846.        In addition, it

convicted him of making available his family home to store and

distribute drugs, in violation of 21 U.S.C. § 856(a)(2).             He was

sentenced   to   135   months   in   prison.   The   jury    convicted   Ms.

Nicholson of money laundering for her role in the purchase of the

Waldorf home, in violation of 18 U.S.C. § 1956(a)(1)(B)(I).              The

district court sentenced her to twelve months and a day.           Finally,

the jury convicted Turner of being a felon in possession of a

firearm, in violation of 18 U.S.C. § 922(g)(1).         He was sentenced

to 70 months.

                                     II.

     Defendants initially contend that various pieces of evidence

should have been suppressed at trial, because they were obtained in

                                      9
violation of either statutory or constitutional provisions.          We

find no merit in these arguments.

                                   A.

     Nicholson, Sr. argues that the government failed to satisfy

the statutory “exhaustion” requirement for obtaining wiretaps. See

18 U.S.C. § 2518(1)(c), (3)(c).         “Prior to granting an order

authorizing a wiretap, the issuing judge must find, in addition to

probable cause, that ‘normal investigative procedures have been

tried and have failed or reasonably appear to be unlikely to

succeed if tried or to be too dangerous.’”            United States v.

Oriakhi, 57 F.3d 1290, 1298 (4th Cir. 1995) (quoting 18 U.S.C.

§ 2518(3)(c)).   The government’s burden in making this showing “is

not great,” and we owe “considerable deference to the district

court’s   determination   that   exhaustion   has   been   shown.”   Id.

(internal quotation marks omitted).

     The government’s affidavits in support of the wiretaps were

drafted in some detail, and satisfied its burden under 18 U.S.C.

§ 2518.   The affidavits illustrated that law enforcement officers

had utilized several traditional methods of investigation prior to

requesting the wiretaps.    The officers had, for example, examined

telephone records, employed several confidential informants and an

undercover officer, and engaged in trash searches and physical

surveillance.    Yet through all these investigative techniques, the

                                   10
officers were not able to uncover the full scope of the drug

conspiracy.      The affidavits detailed the limitations of each

investigative technique attempted thus far.             As a result, the

affiant claimed wiretaps were necessary. The issuing judge agreed,

and we affirm.

                                     B.

     Nicholson, Sr. also asserts that the search of his Palmer Park

home on June 12, 2003 violated the Fourth Amendment, because the

search warrant was improperly based on information obtained from

unlawful   wiretaps.    But   this    argument   is    foreclosed   by   our

conclusion that the wiretaps were proper.         And even disregarding

the evidence obtained through wiretaps, the affidavit in support of

the search warrant still presented overwhelming evidence that drug

distribution was taking place at the home.            See United States v.

Wright, 991 F.2d 1182, 1186 (4th Cir. 1993) (“The inclusion of

tainted evidence does not invalidate a search warrant if enough

untainted evidence supports it.”).        Confidential informants had,

for example, repeatedly visited the Palmer Park home to purchase

drugs from Nicholson, Jr.     There is thus no basis to suppress the

evidence gathered from the search.

                                     11
                                   C.

     Nicholson, Jr. contends that the contraband recovered from his

Dodge pickup -- including the RF detector -- should have been

suppressed, because the police did not have a warrant to search the

truck.     We disagree.    A warrant is not required to search an

automobile if it “is readily mobile and probable cause exists to

believe it contains contraband.”         United States v. Brookins, 345

F.3d 231, 238 (4th Cir. 2003) (internal quotation marks omitted);

see also Maryland v. Dyson, 527 U.S. 465, 466-67 (1999) (per

curiam) (noting that there is “no separate exigency requirement”).

These conditions are met here.     Nicholson, Jr.’s truck was mobile,

and officers had repeatedly witnessed him taking the truck to meet

with other coconspirators before they seized it.            The contraband

obtained from the truck was, therefore, properly admitted at trial.

                                   D.

     Ms.    Nicholson   alleges   that   the   statements    she   made   to

Detective Hallinger during the search of her Palmer Park home on

June 12, 2003 should have been suppressed because she was not given

Miranda warnings. Her contention is mistaken. A defendant’s Fifth

Amendment Miranda right “relates only to custodial interrogation.”

McNeil v. Wisconsin, 501 U.S. 171, 178 (1991).         “A person is ‘in

custody’ for purposes of Miranda either if the person has been

arrested or if his freedom of action has been curtailed to a degree

                                   12
associated with arrest.”     United States v. Sullivan, 138 F.3d 126,

130 (4th Cir. 1998).    Whether someone is in custody is an objective

determination based on the totality of the circumstances and on

“how a reasonable man would have understood the suspect’s position

at the time.”    United States v. Parker, 262 F.3d 415, 419 (4th Cir.

2001).

     In this case, Ms. Nicholson was not restrained to a degree

associated with arrest.      Detective Hallinger expressly stated to

her that she was not under arrest and that she was not being

charged with a crime.    She was questioned in her home, and was not

handcuffed.     Indeed, she was allowed to go outside to smoke a

cigarette     during   the   questioning.       Based   on   all   these

circumstances, we cannot conclude that Ms. Nicholson was in custody

when Hallinger spoke with her, and Miranda warnings were thus not

required.     See Parker, 262 F.3d at 419 (defendant not in custody

when she was told she was not under arrest, was questioned in her

home, was not handcuffed or otherwise restrained, and was never

told she was not free to leave).         The district court, therefore,

properly admitted her statements.

                                  III.

     Ms. Nicholson also alleges that the district court erred in

not severing her trial from that of the other defendants.            We

review a district court’s decision to deny a motion to sever for

                                   13
abuse of discretion.       United States v. Rivera, 412 F.3d 562, 571

(4th Cir. 2005).    “Generally, individuals indicted together should

be tried together.”       Id. (internal quotation marks omitted).             To

prove   a   district     court   abused     its   discretion,    therefore,   a

defendant must show prejudice resulted from the refusal.                See id.

A   district   court’s    cautionary      instruction   can     help   alleviate

potential prejudice, see United States v. Johnson, 219 F.3d 349,

357 (4th Cir. 2000), and “[c]onvictions should be sustained if it

may be inferred from the verdicts that the jury meticulously sifted

the evidence,” Rivera, 412 F.3d at 571 (internal quotation marks

omitted).

      In the instant case, the district court instructed the jury

that the case against each defendant must be based on the evidence

against that defendant, and that the jury’s verdict as to one

defendant did not control as to the guilt or innocence of another

defendant.     It is clear, moreover, that the jury carefully sifted

the evidence, as it convicted Ms. Nicholson on one count, but

acquitted her on two others on which one or more co-defendants were

convicted.     It, for example, acquitted her on the count of making

available her Palmer Park home for drug distribution, but convicted

her husband.     We, therefore, find no basis to conclude that the

district court abused its discretion here.

                                       14
                                    IV.

     Ms.    Nicholson    next   challenges   the    district   court’s    jury

instructions. We review a district court’s decision whether or not

to give a jury instruction for abuse of discretion.              See United

States v. Abbas, 74 F.3d 506, 513 (4th Cir. 1996).              We conclude

that the district court did not abuse its discretion in its jury

instructions.

                                     A.

     Ms. Nicholson first suggests that the district court gave an

inappropriate “willful blindness” jury instruction regarding the

money laundering charge for her involvement in the purchase of the

Waldorf home.    The district court instructed the jury that:

          You may infer that a defendant acted knowingly from
     circumstantial evidence or from proof that a defendant
     deliberately closed his eyes to what would otherwise have
     been obvious to him.
          Stated another way, a defendant’s knowledge of a
     fact may be inferred from willful blindness to the
     existence of that fact. Willful blindness exists when a
     defendant whose suspicion has been aroused deliberately
     fails to make further inquiries.     If you find that a
     defendant had a strong suspicion that someone withheld
     important facts, yet shut his eyes for fear of what he
     would learn, you may conclude that he acted knowingly.

It also instructed the jury, in addition, that a person cannot act

knowingly     “because     of    ignorance,        mistake,    accident    or

carelessness.” As relevant here, to convict Ms. Nicholson of money

laundering under 18 U.S.C. § 1956(a)(1)(B)(I), the government had

to show that she had knowledge: “(1) that the funds involved in the

                                     15
transaction were the proceeds of illegal activity; and (2) that the

transaction was designed to conceal the nature of the proceeds.”

United States v. Campbell, 977 F.2d 854, 857 (4th Cir. 1992).

     Although     we   have     indicated   that   a   willful   blindness

instruction should be given sparingly, see United States v. Ruhe,

191 F.3d 376, 385 (4th Cir. 1999), we have repeatedly upheld the

use of such an instruction.        See United States v. Guay, 108 F.3d

545, 551 (4th Cir. 1997); United States v. Withers, 100 F.3d 1142,

1145 (4th Cir. 1996).         And we have done so specifically in the

money laundering context.        See United States v. Collins, 372 F.3d

629, 634 (4th Cir. 2004) (citing Campbell, 977 F.2d at 857-59).

The “instruction is appropriate when the defendant asserts a lack

of guilty knowledge but the evidence supports an inference of

deliberate ignorance.”        Guay, 108 F.3d at 551 (internal quotation

marks omitted). In determining whether the instruction was proper,

“we consider the evidence and any reasonable inferences in the

light   most   favorable   to    the   government.”    United    States   v.

Whittington, 26 F.3d 456, 463 n.6 (4th Cir. 1994).

     In this case, Ms. Nicholson’s defense to the money laundering

charge was that she lacked the requisite knowledge.          We find that

the evidence was sufficient to support an inference of deliberate

ignorance.     A large portion of Nicholson, Jr.’s drug transactions,

which dated back to the 1980s, took place in Ms. Nicholson’s Palmer

Park home.     Testimony also showed that she was sometimes in the

                                       16
house when individuals came to engage in drug transactions.              And

law enforcement officers had conducted a search of her Palmer Park

home in 1995 pursuant to a valid search warrant in which crack,

PCP, marijuana, and a scale all were found.            In addition, she told

Detective Hallinger that she did not even know whether her son was

employed.   Yet Nicholson, Jr. was able to make a large payment on

the   Waldorf   home,   and   had   expensive   cars    and   jewelry.   Ms.

Nicholson also failed to mention the fact that she had signed the

papers for the Waldorf home when Detective Hallinger questioned her

about it.       She withheld this information even though she had

benefited from the transaction, which allowed her to deduct the

mortgage interest from her taxable income for several years.

      Although there may have been some evidence to the contrary,

there was sufficient evidence from which the jury could reasonably

infer that Ms. Nicholson was, to say the least, deliberately

ignorant of the illegal nature of her son’s assets.           The jury could

likewise infer that there would be little reason -- other than to

obfuscate the source of the funding -- for her to act as the

nominal purchaser of the Waldorf home.          Although the seller of the

Waldorf home may have been aware that Nicholson, Jr. was behind the

purchase, evidence supports the conclusion that Ms. Nicholson’s

role was to keep this information from government authorities, and

that she was deliberately ignorant of this fact.

                                      17
     The   district   court,   moreover,   gave   an   instruction   that

knowledge cannot be based on mistake or accident. This instruction

goes a long way to reducing the risk that the jury might find

knowledge based only on Ms. Nicholson’s negligent failure to

discover that drug money was the source of the home purchase.        See

Withers, 100 F.3d at 1145.     For these reasons, the district court

did not abuse its discretion in giving the willful blindness

instruction.

                                 B.

     Ms. Nicholson also contends that the district court improperly

failed to advise the jury that good faith was “an absolute defense”

to the money laundering charge.        Her argument is mistaken.      The

district court did not have to give this good faith instruction,

because it properly informed the jury on the knowledge requirements

of the money laundering offense.      See United States v. Fowler, 932

F.2d 306, 317 (4th Cir. 1991) (refusing to require separate good

faith instruction if instruction on specific intent is adequate).

                                  V.

     Ms. Nicholson next asserts that the district court abused its

discretion in refusing to grant her a new trial, because the

government’s evidence at trial was much broader than the money

laundering charge in the indictment.       Specifically, she contends

                                  18
that   the    government    improperly       introduced     evidence    that   she

committed mortgage and tax fraud.             We cannot agree.         It is true

that the Fifth Amendment grand jury trial right is violated when a

defendant is convicted of an offense that was beyond the charges in

an indictment.        See United States v. Randall, 171 F.3d 195, 203

(4th Cir. 1999).       But in this case the evidence that Ms. Nicholson

might have lied on her loan application for the Waldorf home, and

that she took mortgage interest deductions in her tax returns from

this home was used to prove the knowledge element of the money

laundering count, which was clearly charged in the indictment. The

district court, therefore, did not abuse its discretion in refusing

to grant a new trial.

                                       VI.

       All four defendants further claim that the district court

erred in not granting their motions for judgment of acquittal,

because      their    convictions    were    not   supported    by     sufficient

evidence. “A defendant challenging the sufficiency of the evidence

to support a conviction must overcome a heavy burden.”                     United

States v. Hamlin, 319 F.3d 666, 672 (4th Cir. 2003) (internal

quotation     marks    omitted).      “[V]iewing      the   evidence     and   the

reasonable inferences to be drawn therefrom in the light most

favorable to the Government,” we must sustain the conviction if

“the   evidence       adduced   at   trial    could   support    any     rational

                                       19
determination of guilty beyond a reasonable doubt.”    United States

v. Burgos, 94 F.3d 849, 863 (4th Cir. 1996) (en banc) (internal

quotation marks omitted). We have reviewed each of the defendants’

claims with care, and find there to be sufficient evidence to

support all the convictions.

                                VII.

     Lastly, Nicholson, Jr. claims that sentencing him under the

mandatory Sentencing Guidelines violated United States v. Booker,

125 S. Ct. 738 (2005).   His argument is misplaced, because his life

term was based not on the Guidelines but instead on a statutory

mandatory minimum.   See 21 U.S.C. § 841(b)(1)(A).       “Booker did

nothing to alter the rule that judges cannot depart below a

statutorily provided minimum sentence.” United States v. Robinson,

404 F.3d 850, 862 (4th Cir. 2005).     While one of the prerequisites

for the mandatory minimum was a finding that Nicholson, Jr. had

committed two prior drug felonies, Booker does not preclude proper

judicial determination of prior convictions.     See United States v.

Cheek, 415 F.3d 349, 352-53 (4th Cir. 2005).      The district court

thus did not err in applying the mandatory minimum sentence in

§ 841(b)(1)(A).

                                 20
                             VIII.

     For the foregoing reasons, the convictions and sentences of

all defendants are

                                                       AFFIRMED.

                               21
MICHAEL, Circuit Judge, concurring in part and concurring in the
judgment:

          Spending money is legal.    Laundering money by concealing

is not.   The line between these two categories of commercial

transactions is sometimes blurry.       That line can become even

blurrier in a money laundering prosecution when the government

obtains the (rarely used) willful blindness instruction.     A jury

following the instruction may infer from circumstantial evidence

the defendant’s deliberate ignorance of the transaction’s criminal

aspect, which in turn allows the jury to infer guilty knowledge.

The potentially slippery combination of the willful blindness

instruction and a concealment money laundering charge cannot be

permitted to eviscerate the defendant’s right to be convicted only

upon proof beyond a reasonable doubt.     Thus, when the government

considers requesting a willful blindness instruction, it (and the

district court if the request is made) must be especially careful

in examining   the evidence that might support such an instruction.

          While I believe that the government fell demonstrably

short here in its duty to examine, I ultimately conclude that the

record provided the bare minimum for allowing the willful blindness

instruction in the concealment money laundering prosecution of

Gladys Payne Nicholson.   I emphasize, however, that the evidence

supporting the instruction was far weaker than the government would

have us believe.   For these reasons, I am unable to join part IV.A

                                 22
of the court’s opinion, although I concur in the judgment as to

that part.   I otherwise concur.

                                   I.

           According to the trial evidence, defendant Ms. Nicholson

resided at a modest home in Palmer Park, Maryland, with her

husband, defendant Marshall Nicholson Sr.            Their son, defendant

Marshall Nicholson Jr., often engaged in drug sales at the family

home, and Nicholson Sr. facilitated or even conducted some of these

sales.   In 1995 Ms. Nicholson posted bond for her son after he was

arrested on state drug charges; the authorities later recovered

receipts from that bond transaction in a search of the home.            Ms.

Nicholson was never a party to any drug sales, and there was no

evidence that she ever witnessed such sales.

           The   concealment   money    laundering    count   against   Ms.

Nicholson stems from her role in the purchase of a house at 3220

Dunbratton Court in Waldorf, Maryland.        Nicholson Jr. eventually

lived in the house.    The transaction closed on September 9, 1999.

Although the house had a price tag of $500,000 as reported on the

mortgage documents, the seller, Raymond F. Procopio Builders, Inc.,

actually accepted a lower price.        At closing Ms. Nicholson paid

$23,669.     A lender, Equicredit Corporation of Maryland, paid

$340,726, and it was Ms. Nicholson who borrowed this money from

Equicredit by signing appropriate loan documents.             The builder

                                   23
retained a deposit of $25,000.     It appears that the cash sum of

$7,905 was used at the closing.        The origin of this cash is not

clear; the seller’s representative, Raymond F. Procopio, testified

that no cash changed hands at closing.     Nicholson Jr. later told an

associate that he put down $100,000 toward the purchase of the

house.

            Ms. Nicholson, who worked for the U.S. Department of

Health and Human Services, earned as much as $62,000 a year in

wages until her retirement in 2000; thereafter her income was about

$45,000 a year.     (Nicholson Sr., who was wheelchair bound, had

negligible income other than social security.)        Ms. Nicholson’s

ordinary income after taxes was thus not enough to pay the monthly

mortgage installments on the Dunbratton Court house. Nicholson Jr.

must have paid the mortgage, but his only apparent source of

legitimate income was a car washing and detailing service that he

operated.

            On June 12, 2003, while law enforcement executed a search

warrant at the family home, Prince George’s County Police Detective

Dennis Hallinger asked Ms. Nicholson several questions about her

ownership of property.      Asked whether she had her name on any

property other than her home, Ms. Nicholson indicated that she was

record owner of the house in which her daughter-in-law Cheryl

Nicholson resided, but that Cheryl paid the mortgage on that house.

Hallinger testified that he then asked Ms. Nicholson, “Do you own

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any other property that you just put in your name for someone else

like you did for Cheryl?.”     She said she did not.

                                  II.

                                   A.

             Count Twelve of the indictment (the sole count upon which

the jury convicted Ms. Nicholson) charged that Ms. Nicholson

violated   the   concealment   money    laundering   statute,   18   U.S.C.

§ 1956(a)(1)(B)(I), when she bought the Dunbratton Court house. To

obtain a conviction under § 1956(a)(1)(B)(I) the government must

prove that

     (1) the defendant conducted or attempted to conduct a
     financial transaction having at least a de minimis effect
     on interstate commerce . . .; (2) the property that was
     the subject of the transaction involved the proceeds of
     specified unlawful activity; (3) the defendant knew that
     the property involved represented the proceeds of some
     form of unlawful activity; and (4) the defendant knew
     that the transaction was designed in whole or part, to
     conceal or disguise the nature, the location, the source,
     the ownership, or the control of the proceeds of the
     unlawful activity.

United States v. Wilkinson, 137 F.3d 214, 221 (4th Cir. 1998)

(citation omitted). The first two elements are undisputed here but

the second two are; each disputed element requires a knowing

mindset.     The elements thus require that Ms. Nicholson knew (1)

that buying the house involved proceeds from Nicholson Jr.’s drug

distribution, and (2) that buying the house was a transaction that

                                   25
at least partially was designed to conceal or disguise those

proceeds.

            “[W]hen the defendant asserts a lack of guilty knowledge

but the evidence supports an inference of deliberate ignorance,”

the court may instruct the jury on willful blindness.                          United

States v. Ruhe, 191 F.3d 376, 384 (4th Cir. 1999).                The instruction

allows the defendant’s deliberate ignorance of a fact to be treated

as   knowledge    of    that   fact,   and    the    government    may    establish

deliberate ignorance by offering circumstantial evidence.                        “The

record need not contain direct evidence . . . that the defendant

deliberately avoided knowledge of wrongdoing; all that is necessary

is evidence from which the jury could infer deliberate avoidance of

knowledge.”      United States v. Whittington, 26 F.3d 456, 463 (4th

Cir. 1994).      In evaluating the propriety of the willful blindness

instruction,      “we    consider      the    evidence    and     any    reasonable

inferences in the light most favorable to the government.”                     Id. at

463 n.6.

            We have cautioned district courts, however, that “the

deliberate     blindness       instruction      is     only     proper    in    rare

circumstances.”        Ruhe, 191 F.3d at 385.        And although the majority

correctly notes, ante at [16], that we have allowed juries in money

laundering cases to receive the willful blindness instruction,

United States v. Collins, 372 F.3d 629, 634 (4th Cir. 2004), United

States v. Campbell, 977 F.2d 854, 858-59 (4th Cir. 1992), careful

                                         26
examination shows that those cases are not easily squared with this

one.

                                       B.

           In   Collins     one   of    the    defendants   helped    finance

burglaries and regularly served as a “fence” who bought stolen

goods with cash and checks; the other assisted with the burglaries

and received part of his share of the ill-gotten gains through

seemingly legitimate payments on his credit card debt.               Collins,

372 F.3d at 631-32.    The defendants thus played important, direct

roles in the illegal activity that generated the profits they then

helped to conceal.    By contrast Ms. Nicholson was neither a direct

participant in nor a direct observer of any drug sale.               She also

did not derive any direct profit from any such sale.

          The defendant in Campbell was a licensed realtor who,

after spending a good deal of time with the buyer (a drug dealer),

relayed to the sellers the buyer’s proposal to pay $60,000 in cash

under   the   table   and   lower      the    contract   price   accordingly.

Campbell, 977 F.2d at 855-56.          By contrast Ms. Nicholson, a long-

time federal government employee, was not in the business of buying

and selling real estate.          As a result, although the government

stressed that there were numerous irregularities in the documents

Ms. Nicholson signed when she bought the Dunbratton Court house,

and that the reported sales price of the house exceeded the price

                                       27
actually paid, this evidence is of little force.                      Ms. Nicholson,

who was not a realtor by trade, may well have been unaware of the

significance of these irregularities.              In addition, while Campbell

involved a huge cash payment that should have by itself been a red

flag for the realtor that something was amiss, less than $8,000 in

cash   was    tendered    at     the     closing    in     which      Ms.   Nicholson

participated.        This amount was not so large that it should have

aroused Ms. Nicholson’s suspicions as to the source of that cash.

             Finally, the defendant in Campbell did not challenge the

propriety of the willful blindness instruction.                   See Campbell, 977

F.2d   at    857   (“Neither     party    disputes       the    adequacy    of   these

instructions on willful blindness or their applicability to this

case.”) (emphasis added).         That obviously limits Campbell’s value

as a precedent because Ms. Nicholson disputes the use of the

instruction in her case.

                                         III.

             Other    circuits    have     recognized          that   fact-intensive

inquiry is particularly important in concealment money laundering

cases, such as this one, which are quite different from the

traditional example of money laundering.             “In [money laundering’s]

classic form, the money launderer folds ill-gotten funds into the

receipts of a legitimate business, such as a restaurant or a

concert ticket service (two common destinations).                     The variations,

                                          28
however,   are       endless,    and    it   can    be     difficult   to    categorize

transactions that deviate from the paradigm.”                       United States v.

Esterman, 324 F.3d 565, 570 (7th Cir. 2003).                    It is essential for

us,    “even    if    difficult    at    times,      to    ensure   that     the    money

laundering statute not turn into a ‘money spending statute.’”                         Id.

at 573 (quoting United States v. Sanders, 929 F.2d 1466, 1472 (10th

Cir. 1991).       Where, as here, the willful blindness instruction is

applied to the concealment money laundering statute’s requirement

that there be knowledge with respect to two distinct elements of

the crime, our evaluation of the asserted basis for the instruction

must be especially thorough and exacting.

                                             A.

               This evaluation reveals that a good deal of evidence the

government points to as supporting the money laundering count is

less   pertinent      to   the    critical        mental    state   issues    than   the

government asserts.          I begin with the evidence concerning drug

deals that occurred years after Ms. Nicholson bought the Dunbratton

Court house.         This evidence is of negligible value in drawing

inferences about Ms. Nicholson’s awareness of any illegal activity

by Nicholson Jr. before she bought the house.                       For example, the

government emphasizes the conversation recorded in January 2003

between    witness      Kenneth        Pickens      and    Nicholson    Jr.    at     Ms.

Nicholson’s home.          Ms. Nicholson was present in the room when

                                             29
Pickens and Nicholson Jr. were talking; the conversation led to a

drug deal that day between the men.   Nevertheless, this evidence

has little logical relevance to Ms. Nicholson’s knowledge of her

son’s drug dealing when she bought the Dunbratton Court house in

1999, because a criminal conviction requires a defendant to have

the requisite guilty mind at the same instant the defendant is

performing the bad act prohibited by statute.     “[I]t is a basic

premise of Anglo-American criminal law that the physical conduct

and the state of mind must concur.”   United States v. McDougald,

990 F.2d 259, 263 (6th Cir. 1993) (quoting W. Lafave & A. Scott,

Criminal Law § 3.11, at 268 (2d ed. 1986)).   Even if Ms. Nicholson

realized in January 2003 that Nicholson Jr. was selling drugs and

that he arranged to have her buy the house in her name to conceal

his drug profits by making mortgage payments with them, she would

not have been guilty of concealment money laundering because she

would not have possessed the required mindset when she bought the

house in September 1999.

          In addition, witness testimony that Nicholson Jr. sold

drugs out of the parental home “since the early 1980s,” Appellee’s

Br. at 52, does nothing to establish Ms. Nicholson’s deliberate

ignorance of those drug sales absent some other evidence that Ms.

Nicholson could have perceived the transactions as they were taking

place.   Since she worked during the day, she simply may not have

been home when the drug sales occurred.   That her husband and son

                                30
were drug dealers and that she lived in proximity to them cannot be

enough to rationally impute knowledge of the dealing or even

deliberate ignorance of the dealing to her.                  “[M]ere association

with those implicated in an unlawful undertaking is not enough to

prove knowing involvement.”           McDougald, 990 F.2d at 262 (quoting

United States v. Nusraty, 867 F.2d 759, 764 (2d Cir. 1989)).

              Finally, the government exaggerates the import of Ms.

Nicholson’s answers to Detective Hallinger’s questions on June 12,

2003.    Ms. Nicholson never told the detective, for example, that

the house was held in Nicholson Jr.’s name rather than her name, or

that she paid the mortgage even though Nicholson Jr. apparently

did.           We      distinguish       such     affirmative          exculpatory

misrepresentations from denials of guilt.               “While general denials

of    guilt    later   contradicted      are    not    considered      exculpatory

statements, any other exculpatory statement which is contradicted

by evidence at trial” permits the jury to infer consciousness of

guilt   from    the    demonstrably    false    alibi.        United    States   v.

McDougald, 650 F.2d 532, 533 (4th Cir. 1981) (per curiam).                       Ms.

Nicholson’s answers are properly classified as denials of guilt,

not as false exculpatory statements.                  In addition, since the

government’s theory of the concealment money laundering count is

essentially that Nicholson Jr. used Ms. Nicholson as a straw buyer

for    the    house,   Ms.   Nicholson    would       only   have   advanced     the

transaction’s concealment purpose by holding herself out as the

                                        31
true owner of the house.        By tending to deny such ownership, Ms.

Nicholson reduced her effectiveness as a straw buyer.           Thus, Ms.

Nicholson’s responses to the detective do not rationally support

the government’s theory.

                                    B.

          I now turn to the evidence that rationally supports an

inference that Ms. Nicholson deliberately ignored (1) the source of

the money Nicholson Jr. contributed to the house purchase, and (2)

the design of the purchase as a concealing transaction.          As to the

first element, Ms. Nicholson posted bond for her son when state

police arrested him on drug charges in 1995.             The jury could

logically conclude that she knew of his drug dealing in 1995, and

that when participating in the house deal in 1999 she deliberately

ignored the illegal source of her son’s money (which he needed to

pay off the $340,726 loan taken out to pay for the house).

          As to the second element, the government’s evidence

established   a   significant    discrepancy   between   Ms.   Nicholson’s

annual income as reported on her tax return in 1998 (in particular,

$58,238 in wages plus $3,065 deferred into her retirement fund) on

the one hand, and the amount of money ($340,726) borrowed from

Equicredit to buy the house in 1999 on the other hand.           The jury

was entitled to conclude from this discrepancy (and from the bond

posting in 1995) that Ms. Nicholson knew in 1999 that she could not

                                    32
have afforded to buy the house herself and that her son could not

have afforded the house either -- unless he paid with illicit funds

that he wanted to conceal.

            The only legal income Nicholson Jr. had was from a car

detailing business, and the jury could have relied on common sense

in concluding that the business simply would not have generated the

amount of money Nicholson Jr. needed each month to pay off the

mortgage.    Conversely, if the discrepancy between any legitimate

income source and the value of the house had been very small, it

would have been far more likely that Ms. Nicholson was simply

negligent -- but not deliberately ignorant -- of the transaction’s

concealment aspect.        The bond posting and the income-mortgage

discrepancy are not strong pieces of evidence, but we must view

them in the light most favorable to the government.        Whittington,

26 F.3d at 463 n.6.       In that light there was enough evidence that

Ms. Nicholson was deliberately ignorant to allow the jury to

receive   the   willful    blindness    instruction.   Accordingly,   the

majority is correct in denying Ms. Nicholson a new trial and

affirming her conviction.

                                    IV.

            This case is unusual in that it involves a concealment

money laundering prosecution not of Nicholson Jr., the principal,

but of Ms. Nicholson, the third party nominee in the Dunbratton

                                       33
Court house purchase.       The willful blindness instruction allowed

the jury to infer her guilty knowledge as to two distinct elements

of the concealment money laundering statute.           The basis for the

instruction was ultimately adequate, but I have explained why it

was not nearly as substantial as the government’s brief indicates.

I trust that the government will take care in the future to make a

thorough   and   exacting    inquiry   before   it   requests   a   willful

blindness instruction in any case, especially a money laundering

case.   Any failure to do that would disrespect our warning that the

instruction “is only proper in rare circumstances.” Ruhe, 191 F.3d

at 385.

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