Court Opinion

ID: 2683745
Source: CourtListenerOpinion
Date Created: 2014-07-15 16:00:47.747534+00
Date Added: 2024-06-11T13:13:37.916626
License: Public Domain

United States Court of Appeals
                             For the Eighth Circuit
                         ___________________________

                                 No. 13-1455
                         ___________________________

                              United States of America

                         lllllllllllllllllllll Plaintiff - Appellee

                                            v.

                                Tang (Janny) Nguyen

                       lllllllllllllllllllll Defendant - Appellant
                                       ____________

                     Appeal from United States District Court
                      for the District of Nebraska - Lincoln
                                  ____________

                             Submitted: March 24, 2014
                                Filed: July 15, 2014
                                  ____________

Before LOKEN, BYE, and BENTON, Circuit Judges.
                           ____________

LOKEN, Circuit Judge.

       Tang (Janny) Nguyen and five others were charged with various offenses after
they imported from Vietnam and sold in Nebraska thousands of cigarettes without
paying pertinent federal, state, and local taxes. The most culpable defendants pleaded
guilty and agreed to cooperate. The case went to trial against Ms. Nguyen and a co-
defendant, who was acquitted by the jury of all charges.
      The multi-count indictment charged Ms. Nguyen with conspiracy to violate 18
U.S.C. §§ 545, 1341, 2342(a), and 26 U.S.C. §§ 5701(b) and 5762(c)(3); fraudulent
importation of “contraband cigarettes”; evasion of federal cigarette taxes; and five
counts of mail fraud. After a five-day trial, the jury acquitted her of those charges.
In addition, Count VI alleged that Ms. Nguyen “did knowingly ship, transport,
receive, possess, sell and distribute ‘contraband cigarettes’” in violation of 18 U.S.C.
§ 2342(a) on or about March 22, 2012. The jury convicted Ms. Nguyen of that
charge. She appeals, arguing the evidence was insufficient to convict her of
knowingly trafficking in contraband cigarettes. We agree and therefore reverse.

                                           I.

        In May 2011, an informant notified the County Sheriff’s Office that a person
later identified as Van Phan was selling Vietnamese cigarettes in Nebraska City, some
fifty miles east of Lincoln, Nebraska. An extensive investigation revealed multiple
packages from Vietnam addressed to locations in the Lincoln area, including the
home of Ms. Nguyen and the nearby home of her sister, Kim Nguyen. From
December 2011 to March 2012, Immigration and Customs Enforcement agents
conducted five “border searches” of packages addressed to those homes, opening the
packages, photographing and inventorying the Vietnamese cigarettes inside, and
resealing the packages for postal delivery. At trial, ICE Agent Stewart testified that
he also obtained a warrant and searched eleven packages addressed to Ms. Nguyen
on April 4. Inside the packages were cartons and packs containing 11,680
Vietnamese cigarettes. None of the cigarette packs had a Nebraska cigarette tax
stamp, which is required to lawfully sell cigarettes in that State. Neb. Rev. Stat. § 77-
2606. The eleven packages were then delivered to Ms. Nguyen’s home and were the
basis for the Count VI offense. During the investigation, agents searched a total of
twenty-eight packages addressed to Ms. Nguyen, all of which contained unstamped
Vietnamese cigarettes.

                                          -2-
       On April 24, investigator Marlan Hohnstein interviewed Ms. Nguyen during
a warrant search of her home after giving Miranda warnings in both English and
Vietnamese. At trial, Hohnstein testified that Ms. Nguyen “acknowledged that there
were many packages that had come to her residence . . . from Vietnam and she knew
that they contained cigarettes.” Ms. Nguyen admitted to signing for the delivery of
some packages; many others arrived while she was at work. When packages arrived,
Ms. Nguyen said “her job was to . . . get them to her sister Kim.” Ms. Nguyen would
call Kim and ask her to pick them up. She knew “Kim sold the cigarettes on the
street.” Her brother in Vietnam sent the packages, and during a visit to Vietnam she
had once gone with him to seal and mail packages to the United States.

       Kim Nguyen testified for the government pursuant to a plea agreement in
which she agreed to cooperate. Kim testified that she began receiving shipments of
untaxed cigarettes from relatives in Vietnam around March 2011. She did not have
a license to import or sell the cigarettes and never paid federal or state cigarette taxes.
Early on, Kim asked if she could “borrow [Ms. Nguyen’s] address so cigarette[s] can
be sent to her address and she agree[d].” Kim told Ms. Nguyen that the packages
contained cigarettes. Relatives in Vietnam mailed two or three packages to Kim and
Ms. Nguyen every one to three weeks. The packages contained six cartons of
cigarettes. Kim sold some of the cigarettes herself, sending the profits back to
relatives in Vietnam, and gave cigarettes to Hoa Van Huynh and Teo Van Phan, two
resellers who also pleaded guilty and testified for the government at trial.

       Kim testified that she picked up packages delivered to Ms. Nguyen’s home.
Kim did not pay Ms. Nguyen for receiving the packages of cigarettes. Ms. Nguyen
did not sell any cigarettes but knew that money from sales of the cigarettes was sent
to their brother in Vietnam. Kim did not discuss with Ms. Nguyen that the cigarettes
coming from Vietnam “were not taxed by the United States.” At one point Ms.
Nguyen “scream[ed]” at Kim to “stop sending to my address.”

                                           -3-
                                         II.

        Ms. Nguyen was convicted of violating 18 U.S.C. § 2342(a), which provides:
“It shall be unlawful for any person knowingly to ship, transport, receive, possess,
sell, distribute, or purchase contraband cigarettes or contraband smokeless tobacco.”
“Contraband cigarettes,” an element of the offense, is defined in § 2341(2):

            (2) the term “contraband cigarettes” means a quantity in excess of
      10,000 cigarettes, which bear no evidence of the payment of applicable
      State or local cigarette taxes in the State or locality where such
      cigarettes are found, if the state or local government requires a stamp,
      impression, or other indication to be placed on packages or other
      containers of cigarettes to evidence payment of cigarette taxes, and
      which are in the possession of any person other than [one who holds
      under proper authorization].

At trial, the government proved that more than 10,000 Vietnamese cigarettes bearing
no evidence of the payment of applicable Nebraska cigarette taxes were received and
sold in Nebraska by one or more persons who were not authorized to receive and sell
them. The fighting issue was whether Ms. Nguyen knowingly violated § 2342(a).

       Prior to and during trial, defense counsel requested a jury instruction that a
violation of § 2342(a) “requires proof of specific intent,” that is, proof that Ms.
Nguyen “knowingly did an act which the law forbids, purposely intending to violate
the law.” The district court denied this request, explaining that it agreed with the
Sixth Circuit that the Supreme Court’s decision in United States v. Liparota, 471 U.S.
419 (1985), adopting a specific intent requirement for knowing violations of the
federal food stamp fraud offense, does not apply to knowing violations of § 2342(a).
United States v. Elshenawy, 801 F.2d 856, 859 (6th Cir. 1986), cert. denied, 479 U.S.
1094 (1987), followed in United States v. Baker, 63 F.3d 1478, 1491-93 (9th Cir.
1995), cert. denied, 516 U.S. 1097 and 516 U.S. 1117 (1996).

                                         -4-
      We agree that § 2342(a) is not a specific intent statute, but that does not resolve
the question of what the government must prove to establish a “knowing” violation.
On this question, the record and appellate briefs are silent, but the Supreme Court has
provided substantial guidance:

      [T]he term “knowingly” does not necessarily have any reference to a
      culpable state of mind or knowledge of the law. As Justice Jackson
      correctly observed, “the knowledge requisite to knowing violation of a
      statute is factual knowledge as distinguished from knowledge of the
      law.” . . . Thus, unless the text of the statute dictates a different result [as
      in Liparota], the term “knowingly” merely requires proof of knowledge
      of the facts that constitute the offense.

Bryan v. United States, 524 U.S. 184, 192-93 (1998) (citations omitted). This was not
an issue in Elshenawy, because the defendant conditionally pleaded guilty to
violating § 2342(a), admitted “he knew that the cigarettes in his possession bore no
indicia and . . . assumed that no state taxes had been paid,” and appealed the district
court’s ruling that the government need not prove knowledge of the state taxing
requirement. 801 F.2d at 857.

        When a criminal statute introduces the elements of a crime with the word
“knowingly,” we apply that word to each element of the crime unless special context
or background calls for a different reading. United States v. Bruguier, 735 F.3d 754,
758 (8th Cir. 2013) (en banc). Thus, the district court properly instructed the jury that
the government must prove beyond a reasonable doubt that Ms. Nguyen knowingly
(i) trafficked in more than 10,000 cigarettes that (ii) “bore no evidence of the payment
of applicable State or local cigarette taxes.” However, in denying Ms. Nguyen’s post-
verdict motion for judgment of acquittal, the court lost sight of the second half of this
instruction, which properly focused on whether the cigarettes “bore evidence” that
applicable taxes had been paid, as § 2341(2) required. Instead, the court concluded,
Ms. Nguyen’s admissions to investigator Hohnstein that she knew packages mailed

                                            -5-
to her contained cigarettes, signed for some of the packages, and left them for Kim
to pick up “is certainly sufficient to support the jury’s determination that the
defendant knowingly possessed contraband cigarettes.”

       On appeal, Ms. Nguyen argues, as she did to the district court, that “there is no
evidence in the record that [Ms. Nguyen] was aware of any applicable sales taxes on
the cigarettes. This was a fact that the actual importer, Kim Nguyen, did not discuss
with her.” The government’s brief responded, citing page 373 of the trial transcript:
“Nguyen informed Deputy Hohnstein she knew her brother and nephew were sending
packages from Vietnam to her and her sister and that the packages contained untaxed
Vietnamese cigarettes.” (Emphasis added.) This is an inexcusable misstatement of
the trial record. At pages 373-75, Hohnstein testified:

      Q. What did she tell you regarding the packages that had come to her
      residence from Vietnam?

      A. She acknowledged that there were many packages that had come to
      her residence that came from Vietnam and she knew that they contained
      cigarettes.

                                  *   *    *    *   *

      Q. What did she say to you regarding who she identified as the sender
      of those packages?

      A. She told me that her brother had sent them from Vietnam.

                                  *   *    *    *   *

      Q. What did she tell you with regard to her understanding of the process
      for the packages mailed from Vietnam to her address?

      A. She told me that she was actually with her brother at a time when
      those packages had been sent from Vietnam. They would take them to

                                          -6-
      the post office in Vietnam and present the packages, a person there
      would look at the packages and then they would be sealed up and sent
      away.

                                 *   *    *    *   *

      Q. What did she tell you regarding the packages mailed to her sister?

      A. She said that she knew her sister Kim had received the same kind of
      packages, boxes with cartons of cigarettes in them.

       This was the only evidence in the government’s fifteen-witness case regarding
Ms. Nguyen’s knowledge of whether the cigarettes received at her home from
Vietnam “bore no evidence of the payment of applicable State or local cigarette
taxes.”1 Contrast this lack of proof with the substantial evidence suggesting the need
for affirmative proof on this issue: (1) The packages arriving from Vietnam bore no
outward sign that they contained cigarettes. Investigating agents had to open the
packages and remove individual cigarette packs from their cartons to determine the
packs bore no Nebraska tax stamp. (2) There was no evidence Ms. Nguyen ever
opened a package received at her home. She left the packages on her kitchen table
for Kim to pick up. (3) The warrant search of Ms. Nguyen’s home uncovered no
evidence that any box was opened at her home. No one testified that Ms. Nguyen
ever possessed or even saw an individual pack of untaxed cigarettes after it arrived
from Vietnam in Nebraska. (4) There was no evidence Ms. Nguyen ever sold or
distributed the cigarettes, or profited from their distribution. She just delivered
packages received at her home from Vietnam, unopened, to her sister.

      Our review of this evidence persuades us that the government simply failed to
prove a knowing violation of § 2342(a). There was sufficient evidence she

      1
       The government did not include any of its 636 trial exhibits in the record on
appeal, leaving us to infer their contents and appearance from witness testimony.

                                         -7-
knowingly received the packages,2 but not that she knowingly received “contraband
cigarettes” hidden inside the packages. This might have been sufficient to convict
Ms. Nguyen of conspiracy to violate § 2342(a), but the jury acquitted her of that more
serious offense. It is not unreasonable that Ms. Nguyen knew that the cigarettes
delivered to her home for her sister to distribute “bore no evidence of the payment of
applicable State or local cigarette taxes” and therefore had sufficient “knowledge of
the facts that constitute the offense,” Bryan, 524 U.S. at 193. But speculation will not
take the place of proof. The government had ample opportunity to prove that fact, for
example, through better questioning of Ms. Nguyen by Deputy Hohnstein, better
questioning of cooperating witness Kim at trial, or presenting testimony by Ms.
Nguyen’s son. It did not do so. And its closing argument to the jury simply ignored
this element of the offense -- knowingly trafficking in “contraband cigarettes” as
defined in the statute -- telling the jury it should convict because Ms. Nguyen
“knowingly received those cigarettes. Those cigarettes were more than 10,000
cigarettes and those cigarettes bore no tax stamp.” By telling the jury that the word
“knowingly” in § 2342(a) did not apply to the “bear no evidence” element of the
offense, the government committed the same error that required reversal in Bruguier,
735 F.3d at 757-58, 763. But there is one important difference. In this case, the jury
was properly instructed; the government simply ignored those instructions.

      This is not an easy issue because of our overriding obligation to give proper
deference to the jury verdict. We review the sufficiency of the evidence de novo, but
we must “view[] the evidence in the light most favorable to the verdict and draw[] all
reasonable inferences in its favor.” United States v. Vore, 743 F.3d 1175, 1180 (8th

      2
       The parties briefed this case as though § 2342(a) prohibits only unlawful
possession of contraband cigarettes. But the statute is directed at unlawful trafficking
and therefore prohibits acts beyond actual or constructive possession. In this case,
for example, the evidence was sufficient to prove that Ms. Nguyen knowingly
“received” the packages, even if she did not sign for them and was not present when
they were delivered and picked up by sister Kim.

                                          -8-
Cir. 2014). “[T]he relevant question is whether, after viewing the evidence in the
light most favorable to the prosecution, any rational trier of fact could have found the
essential elements of the crime beyond a reasonable doubt.” Jackson v. Virginia, 443
U.S. 307, 319 (1979). Here, having thoroughly reviewed the record on appeal in that
manner, we conclude that, in a lengthy trial focused primarily on other issues, the
government failed to perceive what was needed to prove that Ms. Nguyen knowingly
trafficked in contraband cigarettes and, in highlighting for the jury what it did prove,
misled a properly instructed and otherwise rational jury into convicting Ms. Nguyen
of a crime the government had failed to prove. Thus, the verdict convicting Ms.
Nguyen of Count VI must be overturned. In addition, as this was a failure of proof
at a trial in which the government had fair opportunity “to offer whatever proof it
could assemble,” the Double Jeopardy Clause requires entry of judgment of acquittal,
rather than grant of a new trial. Burks v. United States, 437 U.S. 1, 16-17 (1978).

      The judgment of the district court is reversed.
                     ______________________________

                                          -9-