Court Opinion

ID: 9488826
Source: CourtListenerOpinion
Date Created: 2023-08-05 12:56:40.543547+00
Date Added: 2024-06-11T17:53:07.631598
License: Public Domain

WALKER, Circuit Judge,
dissenting:
When Michael Peck requested the district court to instruct the jury that the government was required to prove that he knew that structuring his transactions to avoid the cash transaction reporting requirements was a crime, the district judge rejected the request in appropriate reliance on the then-existing law in this circuit. See United States v. Caming, 968 F.2d 232, 238-41 (2d Cir.), cert. denied, 506 U.S. 956, 113 S.Ct. 416, 121 L.Ed.2d 339 (1992). Peck did not appeal his conviction. Subsequently, in Ratzlaf v. United States, — U.S. -, -, 114 S.Ct. 655, 663, 126 L.Ed.2d 615 (1994), the Supreme Court held that the government must prove that the defendant knew that structuring was unlawful when he structured the transactions. Shortly thereafter, Peck filed a petition under 28 U.S.C. § 2255 requesting, among other things, that his conviction be vacated because the jury should have been given the Ratzlaf-type charge he had requested.
The district court rejected Peck’s argument with respect to the erroneous instruction on the ground that there was no “fundamental unfairness.” In reversing, the majority holds that Peck has demonstrated both cause for his failure to raise the issue on direct appeal and actual prejudice arising therefrom. Because I believe that the district court was correct and that Peck has failed to satisfy the test of Brecht v. Abrahamson, 507 U.S. 619, 113 S.Ct. 1710, 123 L.Ed.2d 353 (1993), I respectfully dissent.
In Brecht, the Supreme Court held that in collateral proceedings the test for whether a “trial error” is sufficient to warrant reversal is “whether the error ‘had substantial and injurious effect or influence in determining the jury’s verdict.’” 507 U.S. at 637, 113 S.Ct. at 1722 (quoting Kotteakos v. United States, 328 U.S. 750, 66 S.Ct. 1239, 90 L.Ed. 1557 (1946)). In so doing, the Court rejected for collateral review, the standard of “harmless beyond a reasonable doubt” announced in Chapman v. California, 386 U.S. 18, 87 S.Ct. 824, 17 L.Ed.2d 705 (1967) for direct review of constitutional error. The inquiry is therefore two-fold: first, whether the failure to give the Ratzlaf instruction was a “trial error”; second, if it was, whether the error “ ‘substantially influenced the jury’s decision,’ ” O’Neal v. McAninch, — U.S. -, -, 115 S.Ct. 992, 995, 130 L.Ed.2d 947 (1995).
A. Trial Error
I have no difficulty concluding that the error by the district court, viewed in hindsight from the perspective of Ratzlaf, was trial error. The Supreme Court has found, in most cases, that even constitutionally-deficient jury instructions are “trial errors,” not “structural errors,” and thus are subject to harmless error analysis. See United States v. Gaudin, — U.S. -, -, 115 S.Ct. *12302310, 2321, 132 L.Ed.2d 444 (1995) (Rehnquist, C.J., concurring) (citing cases). For example, the Court has applied harmless error analysis in cases where the trial court incorrectly charged the jury that it could determine obscenity with reference to statewide standards rather than to a reasonable person standard, Pope v. Illinois, 481 U.S. 497, 502-04, 107 S.Ct. 1918, 1921-23, 95 L.Ed.2d 439 (1987), where an unconstitutional burden-shifting jury instruction was given, Yates v. Evatt, 500 U.S. 391, 402, 111 S.Ct. 1884, 1892, 114 L.Ed.2d 432 (1991), and where erroneous presumption instructions were given, Carella v. California, 491 U.S. 263, 266, 109 S.Ct. 2419, 2421, 105 L.Ed.2d 218 (1989) (per curiam); Rose v. Clark, 478 U.S. 570, 579-80, 106 S.Ct. 3101, 3106-07, 92 L.Ed.2d 460 (1986). The Court has carved out a single exception: where the trial court fails to give a proper “reasonable doubt” instruction, the error requires automatic reversal. See Sullivan v. Louisiana, 508 U.S. 275,-, 113 S.Ct. 2078, 2082, 124 L.Ed.2d 182 (1993).
I believe that the proper question for us, then, is whether the failure to give a Ratzlaf instruction is consistent with the numerous cases of faulty instructions in which harmless error review has been applied, or the singular situation, per se not harmless, in which the trial court gives an improper reasonable doubt instruction. The caselaw of the Supreme Court and of this circuit leads me to the conclusion that the error in this case falls within the former category and thus is amenable to harmless error analysis.
In Sullivan, Justice Sealia, writing for the Court, distinguished a failure to give a reasonable doubt instruction from other errors. He reasoned that when the reasonable doubt instruction is flawed, “the question whether the same verdict of guilty-beyond-a-reasonable-doubt would have been rendered absent the constitutional error is utterly meaningless. There is no object, so to speak, upon which harmless-error scrutiny can operate.” 508 U.S. at -, 113 S.Ct. at 2082. That logic, though, is irrelevant in this ease. Unlike the situation in Sullivan, Peck was convicted by a jury of his crime beyond a reasonable doubt, and therefore, we are not prevented from concluding, if the evidence so warrants, “that the jury’s actual finding of guilty beyond a reasonable doubt would surely not have been different absent the constitutional error.” Id.
In this circuit, we have applied harmless error analysis to an erroneous jury instruction on collateral review. In Ianniello v. United States, 10 F.3d 59, 63-64 (2d Cir.1993), we concluded that a failure to give a proper RICO pattern charge' was not subject to automatic reversal, and we affirmed “because the evidence demonstrate^] beyond a reasonable doubt the missing element in the jury instruction.” In my view, harmless error analysis applies to the erroneous Ratzlaf charge no less than to the improper RICO pattern charge in Ianniello. See also United States v. Parmelee, 42 F.3d 387 (7th Cir.1994), cert. denied, — U.S. -, 116 S.Ct. 63, 133 L.Ed.2d 25 (1995); People v. Avila, 35 Cal.App.4th 642, 43 Cal.Rptr.2d 853 (1995).
B. Harmless Error Under § 2255.
The remaining question is whether the failure to give the Ratzlaf instruction was harmless, an inquiry that I equate to the “actual prejudice” test under United States v. Frady, 456 U.S. 152, 102 S.Ct. 1584, 71 L.Ed.2d 816 (1982). As the First Circuit has noted, there is confusion in the caselaw over the proper standard to apply: 1) whether the jury must have made findings so nearly equivalent to the missing finding that the error is harmless, or 2) whether the evidence presented at trial established the missing element beyond a reasonable doubt. See United States v. Marder, 48 F.3d 564, 573 (1st Cir.), cert. denied, — U.S. -, 115 S.Ct. 1441, 131 L.Ed.2d 320 (1995). While the majority appears to adopt the first approach in this case, see supra at 1227, I believe that, at least in the context of collateral review, the second is more consistent with the precedents of the Supreme Court and of this circuit.
Under the test the majority uses, the failure to give a proper instruction must always result in a reversal unless “it is clear that the jury’s findings resolved in the government’s favor the issue that would have been posed *1231by a jury instruction that incorporated the new element.” See supra at 1227. The effect of this standard will be to ensure that in almost every case in which the trial court fails to properly instruct on an element of an offense, a reversal of the conviction will be required. Only in the few cases where the jury’s findings on other issues would necessitate a conclusion in the government’s favor on the missing element will the error be found to be harmless.1
The sources cited by the majority do not support its narrow view. Sullivan, as I noted above, was not a harmless error case at all, but rather a ease in which the Supreme Court found a reasonable doubt instruction to be a structural error, requiring automatic reversal. In Frady, the Court held that the failure to give a proper malice instruction was not prejudicial because “the strong un-eontradicted evidence of malice in the record, coupled with Frady’s utter failure to come forward with a colorable claim that he acted without malice, disposes of his contention that he suffered actual prejudice.” 456 U.S. at 172, 102 S.Ct. at 1596. Far from supporting the majority’s rule, Frady illustrates the Supreme Court’s directive that, in connection with a § 2255 petition, we must examine the actual evidence at trial to see if a harmless error occurred.
Finally, the majority’s citation to lanniello does not aid its conclusion. To be sure, we said there that courts may uphold a jury verdict despite an erroneous charge where the “facts found by a jury are so conclusive on an ultimate factual issue ... that the error in the charge and resultant absence of an actual jury finding on the ultimate issue are harmless.” 10 F.3d at 64. However, we went further. We stated that “a conviction should be affirmed where a reviewing court can find that the record at trial established guilt beyond a reasonable doubt and where no rational jury could conclude otherwise.” Id. at 65 (internal citations and quotations omitted) (citing Pope, 481 U.S. at 501-04, 107 S.Ct. at 1921-23).
The better view, I believe, is that we may affirm a conviction despite an erroneous Rat-zlaf instruction where we are convinced that a properly instructed and rational jury, after hearing all the evidence, would necessarily have found the defendant guilty beyond a reasonable doubt. This view is supported not only by the foregoing cases, but also by the decisions of other courts. For example, in United States v. Parmelee, 42 F.3d 387 (7th Cir.1994), cert. denied, — U.S. -, 116 S.Ct. 63, 133 L.Ed.2d 25 (1995), the Seventh Circuit affirmed the defendants’ convictions despite an erroneous mens rea instruction. The defendants had been convicted of conspiring to transport illegal aliens in violation of 8 U.S.C. § 1324(a)(1)(B), inter alia. The Seventh Circuit held that a conviction under § 1324(a)(1)(B) required not only knowledge by the defendant that the alien had entered the United States illegally, but also that the defendant knowingly transported the alien to further the alien’s violation. Despite the trial court’s failure to give the proper instruction, the Seventh Circuit affirmed. The court reasoned that a rational jury, having found that the defendants knew that the aliens were illegal, necessarily would have found that the defendants knew that they were furthering the aliens’ violation of the law. Id. at 393. Significantly, the court noted that, while a jury conceivably could have reached a different result, a jury could not have done so rationally given the jury’s actual findings and the unrebutted mens rea evidence. Id.; see also Avila, 43 Cal.Rptr.2d at 866-67.
Moreover, because this ease involves a § 2255 petition we should be even more cautious in granting relief than the Parmelee court, which was directly reviewing a conviction. A common theme of the Supreme Court’s decisions has been that collateral relief is available only for those who have been “ ‘grievously wronged.’ ” Brecht, 507 U.S. at 637, 113 S.Ct. at 1721. Thus, “ ‘an error that may justify reversal on direct appeal will not *1232necessarily support a collateral attack on a final judgment. The reasons for narrowly limiting the grounds for collateral attack on final judgments are well known and basic to our adversary system of justice.’” Frady, 456 U.S. at 165, 102 S.Ct. at 1593 (quoting United States v. Addonizio, 442 U.S. 178, 184, 99 S.Ct. 2235, 2239, 60 L.Ed.2d 805 (1979)). The majority’s approach, however, will grant relief to all petitioners on collateral review who can show that their jury was not properly instructed on the intent element in a structuring prosecution. But to grant ha-beas corpus relief to anyone who demonstrates that the trial judge did not give a Ratzlaf instruction, even if one is quite sure that the petitioner would have been convicted had the proper instruction been given, ignores Brecht’s command that relief be limited to those “grievously wronged.” I believe that Brecht requires us to discriminate among those petitioners who have shown a failure by the district court to give a proper Ratzlaf instruction and to grant relief only where, based on all the evidence at trial, we are not convinced that a rational jury would have convicted the petitioner if they had received a proper instruction.
Applying these principles, Peck cannot prevail. The evidence the government presented against Peek was overwhelming and would have been viewed that way by a properly charged, reasonable jury. The government demonstrated that Peck had engaged in repeated cash transactions, often on consecutive days, which were all below the $10,000 reporting limits for Currency Transaction Reports (“CTRs”), and which cumulatively would have exceeded the limits. For instance, the evidence at trial showed that Peck opened a new checking account at Northeast Savings Bank on Friday, March 27, 1992. The following Monday, March 30, he withdrew $6500 in cash. On each of the next two days, he withdrew $6000 in cash. The day after that, April 2nd, he withdrew $6500 in cash. Then,- on Friday, April 3rd, he tried to take out $6000 more, but was unable to do so and instead withdrew $7000 from each of two accounts at other banks. The following Monday, April 6th, Peck attempted to withdraw $5000 from an account at the Bank of Boston, but upon being informed that a CTR would have to be filed by the bank, he left and instead withdrew $5000 from an account at the Society for Savings. These transactions, over six consecutive business days, totaled $44,000 in actual withdrawals, through seven different transactions, none of which triggered the CTR reporting requirements.
Of course, the issue is not whether Peck knew about the reporting obligations and intended to evade them, but whether he knew that structuring the transactions was a crime. See Ratzlaf, — U.S. at -, 114 S.Ct. at 663. However, as the Supreme Court pointed out, a jury may “find the requisite knowledge on defendant’s part by drawing reasonable inferences from the evidence of defendant’s conduct.” Id. at -n. 19, 114 S.Ct. at 663 n. 19. Thus, the government was not required to present direct evidence that the Peck knew about the requirement; it could, and in my view did, meet its burden by providing circumstantial evidence that Peck had to have known that what he was doing was illegal. See United States v. Hurley, 63 F.3d 1, 15-16 (1st Cir.1995); United States v. Tipton, 56 F.3d 1009, 1012 (9th Cir.1995); Marder, 48 F.3d at 574; see United States v. Walker, 25 F.3d 540, 548 n. 8 (7th Cir.), cert. denied, — U.S. -, -, 115 S.Ct. 371, 531, 130 L.Ed.2d 323, 434 (1994). But see United States v. Wynn, 61 F.3d 921, 927-28 (D.C.Cir.), cert. denied, — U.S. -, 116 S.Ct. 578, 133 L.Ed.2d 501 (1995); United States v. Vazquez, 53 F.3d 1216, 1225 (11th Cir.1995). In addition to the “intricate and odd structuring of transactions,” Walker, 25 F.3d at 548 n. 8, so as to avoid the reporting requirements and the evidence that Peek refused to withdraw money when told it would trigger the CTR requirements, the government offered the testimony of one bank teller that she had explained the CTR rules to Peck in 1990. Moreover, Peck himself was a lawyer.
Peck’s only evidence in defense seems to have been his own testimony, to which the jury gave no credence. As the majority notes, Peck’s own testimony at trial “oscillated between the implausible and the preposterous.” Supra at 1228. Peck denied knowledge of the criminality of structuring in one *1233very same sentence in place only: in the which he claimed, falsely in the eyes of the jury or they would not have convicted him, that he had not structured his transactions to avoid the CTR requirements. The jury was perfectly free to add its disbelief of Peck’s testimony to the considerable proof of Peek’s mens rea produced by the government. See, e.g., United States v. Aulicino, 44 F.3d 1102, 1114 (2d Cir.1995) (“The defendant’s testimony may thus add weight to the government’s ease.”); United States v. Stanley, 928 F.2d 575, 577 (2d Cir.) (“[T]he jury [is] entitled to disbelieve [the defendant’s] testimony, and use its disbelief to supplement the other evidence against him.”), cert. denied, 502 U.S. 845, 112 S.Ct. 141, 116 L.Ed.2d 108 (1991). There is no reason to believe that the jury credited his denial of knowledge that structuring was a crime any more than his self-serving statement that he was not intentionally trying to evade the CTR requirements, which by its verdict the jury rejected.
Presented with the evidence that Peck knew of the reporting requirements, that he acted purposefully to evade those requirements, and that he was attorney, and having necessarily rejected his flat denial of any knowledge of any of the legal requirements, I can only conclude that the jury, had it been properly charged, would still have found Peek guilty.
The standard of review used by the majority today is, in my view, inappropriate for habeas corpus review after the Supreme Court’s decision in Brecht. The Court there bottomed its application of the Kotteakos standard, and rejection of the Chapman standard, for reviewing constitutional trial error on collateral review upon the notion that “the writ of habeas corpus has historically been regarded as an extraordinary remedy, a bulwark against convictions that violate ‘fundamental fairness.’” 507 U.S. at 629, 113 S.Ct. at 1719 (citations omitted). By effectively applying the Chapman standard in this case, the majority implicitly dispenses with the important distinction between direct and collateral review with which six justices agreed in Brecht, and instead follows the dissent in that case. Because I conclude that no actual prejudice has been shown and that the judgment of the district court dismissing the § 2255 petition should be affirmed, I respectfully dissent.

. Indeed, in a case where the jury is required to find the missing element in reaching a guilty verdict under the charge that was given, there may not even be a constitutional violation. See Avila, 43 Cal.Rptr.2d at 860 (citing Victor v. Nebraska, - U.S. -, -, 114 S.Ct. 1239, 1250-51, 127 L.Ed.2d 583 (1994); Estelle v. McGuire, 502 U.S. 62, 74, 112 S.Ct. 475, 483, 116 L.Ed.2d 385 (1991)). However, resolution of that issue is not required in this case.