United States v. HoskinsUnited States v. Hoskins
RULING ON DEFENDANT’S MOTION TO DISMISS THE INDICTMENT
Defendant Lawrence Hoskins moves [Doc. # 149] to dismiss the Second Superseding Indictment [Doc. # 50] (“the In
Defendant contends that the Indictment must be dismissed in its entirety because (1) he withdrew from the charged conspiracy outside of the limitations period; (2) the Indictment fails to adequately allege that he was an agent of a domestic concern, which is an element of a FCPA offense; (3) alternatively, if he is an agent of a domеstic concern, the FCPA is unconstitutionally vague as applied; (4) the FCPA does not apply extraterritorially to non-U.S. citizens; (5) venue is not proper in this District for the money-laundering counts; and (6) alternatively, if venue lies in this District, the money-laundering counts are multiplicitous with the FCPA counts. For the reasons that follow, Defendant’s motion is denied.
I. Background
On July 30, 2013, a grand jury sitting in New Haven, Connecticut, returned the twelve-count Indictment against Mr. Hos-kins alleging that he participated in a bribery scheme that spanned from 2002 through 2009 for Alstom Power, Inc. (“Al-stom Power U.S.”), a company headquartered in Windsor, Connecticut, to secure a $118 million project to build power stations for Indonesia’s state-owned and state-controlled electricity company, Perusahaan Listrik Negara (“PLN”), known as the Tarahan Project. (Indictment ¶¶2-10, 26.) Mr. Hoskins and his co-defendants are alleged to have arranged, scheduled, and caused payments to Indonesian government officials in exchange for their assistance in awarding the contract to Alstom Power U.S. and its partners. (Id.)
From October 2001 through August 2004, Mr. Hoskins, was employed as a Senior Vice President for the Asia Region by Alstom Holdings S.A. (“Alstom”), a French holding company that is alleged to have acted through its subsidiaries, including Alstom Power U.S., “without distinction” between the different entities. (Id. ¶¶ 2, 7.) Mr. Hoskins, a citizen of the United Kingdom, worked in Paris for Alstom and never traveled to the United States in connection with his employment.
In August 2004, while the charged conspiracy was in progress, Mr. Hoskins re
II. Discussion
“It is well settled that ‘an indictment is sufficient if it, first, contains the elements of the offense charged and fairly informs a defendant of the charge against which he must defend, and, second, enables him to plead an acquittal or conviction in bar of future prosecutions for the same offense.’ ” United States v. Alfonso,
“Unless the government has made what can fairly be described as a full proffer of the evidence it intends to present at trial ..., the sufficiency of the evidеnce is not appropriately addressed on a pretrial motion to.dismiss an indictment” and the allegations in the indictment must be accepted as true. Alfonso,
A. Withdrawal from a Conspiracy
Defendant contends that the Indictment must be dismissed because his resignation from Alstom and severing of ties with his alleged co-conspirators establish his withdrawal from the charged conspiracy as a matter of law and thus the applicable five-year statute of limitations expired on all charges prior to return of the Indictment. See 18 U.S.C. § 3282. Federal Rule of Criminal Procedure 12(b)(1) provides that a “party may raise by pretrial motion any defense, objection, or request that the court can determine without a trial on the merits.”
There is no dispute that Mr. Hoskins resigned from Alstom on August 31, 2004. Thus, if as Mr. Hoskins contends, his resignation constituted withdrawal from the charged conspiracy, the applicable statute of limitations would have еxpired on August 31, 2009, four years before Mr. Hoskins was indicted on July 30, 2013. See Smith v. United States, — U.S. -,
In Smith, the Supreme Court clarified that withdrawal is an affirmative defense that a defendant bears the burden of proving by a preponderance of the evidence.
In outlining the contours of a withdrawal, defense based on resignation from a “criminal enterprise,” the Second Circuit has adopted the following principles:
(1) resignation from the enterprise does not, in and of itself, constitute withdrawal from a conspiracy as a matter of law;
(2) total severing of ties with the enterprise may constitute withdrawal from the conspiracy; however (3) even if the defendant completely severs his or her ties with the enterprise, the defendantstill may remain a part of the conspiracy if he or she continues to do acts in furtherance of the conspiracy and continues to receive benefits from the conspiracy’s operations.
Berger,
Defendant acknowledges that his resignation from Alstom does not establish his withdrawal from the charged conspiracy as a matter of law (Def.’s Mem. Supp. [Doc. # 149-1] at 16); but contends that the Court can “assume that the Indictment’s allegations are true, including the existence, objects, duration, and membership of the alleged conspiracy” (Reply [Doc. # 174] at 6) and that he can establish withdrawal “if he proves by a preponderance of the evidence that he: (i) terminated his employment ties with Alstom in a manner reasonably calculated to reach his alleged co-conspirators; (ii) did nothing post-resignation to participate in or otherwise promote the alleged conspiracy; and (iii) received no additional benefits from the alleged conspiracy’s continued operation after his resignation.” (Def.’s Mem. Supp. at 16).
But the facts supporting this withdrawal defense are not and need not be pled in the indictment, see United States v. Sisson,
However, the Court cannot make such factual determinations pretrial because “[t]here is nо federal criminal procedural mechanism that resembles a motion for summary judgment in the civil context.” United States v. Yakou,
Where a defendant asserts an affirmative defense that is not plain from the face of the indictment and that he or she bears the burden of proving, there must usually be a factual determination оf the merits of the charged offense, which must be made at trial by the jury in the first instance. See United States v. Doe,
Despite the absence of a summary judgment procedure in criminal cases, some courts have dismissed an indictment pretrial where the government stipulates to or does not contest the relevant facts. See, e.g., Alfonso,
Defendant maintains that pretrial adjudication is nevertheless appropriate because of the “unique set of circumstances that make[s] Mr. Hoskins’s withdrawal defense independent from the evidence of the conspiracy alleged.” (Reply at 6 n. 6.) Even if true, Defendant offers no authority suggesting that the Court can without the Government’s consent make a pretrial factual determination of an affirmative defense that would otherwise be decided by the jury at triаl. Cf. Fed.R.Crim.P. 23(a)(3) (requiring the government’s consent to a non-jury trial).
Nor does the Supreme Court’s holding in Smith “make[] a withdrawal defense more conducive to pre-trial determination,” as Defendant maintains. (Reply at 5.) It simply resolved a circuit split and adopted the Second Circuit’s “long-standing precedent that withdrawal from a conspiracy is an affirmative defense which the defendant must prove by a preponderance of the evidence.” United States v. Hamilton,
At trial, Mr. Hoskins will have the opportunity to offer an evidentiary basis for his defense that he withdrew from the charged conspiracy for assessment by the jury. Notwithstanding Defendant’s characterization of his post-resignation activities, the Government identifies a number of factual disputes that must be resolved at trial, such as whether, in resigning from Alstom, Mr. Hoskins “intend[ed] that the bribery scheme would end” or rather “that it would continue as he pursued greener pastures”; whether Defendant’s attendance at the 2007 meeting with his former
B. Withdrawal as to Substantive Counts
The Government' maintains that even if Defendant could prove his withdrawal from the charged conspiracy, it would not be a defense to the substantive FCPA and money laundering counts under a theory of aiding and abetting because the statute of limitations for aiding and abetting does not toll until the substantive crimes are complete. (Gov’t’s Opp’n at 23.) “[I]t is unsettled if a defendant can withdraw from aiding and abetting a crime. Unlike a conspiracy, which by its very nature involves an agreement that can be refuted, accomplice liability can arise from merely encouraging the principal. Given the relatively minor participation that can trigger accomplice liability, it is unclear what actions an individual may take — if any — to immunize himself from liability for a crime that he previously enabled.” United States v. Burks,
In United States v. Arocena, the Second Circuit noted without elaboration that “withdrawal is not a defense to the substantive crime of aiding and abetting a murder.”
The Tenth Circuit has concluded that “it is conceivable that a defendant could withdraw from aiding and abetting a Dyer Act violation,” prohibiting interstate transportation of stolen vehicles, but that the defendant bore the burden of proving withdrawal and failed to do so. Burks,
A fully informed examination of the elements of the substantive crimes in light of the trial evidence is necessary for the Court to adequately apply the reasoning of Smith and Arocena. The parties have not cited any cases examining accomplice withdrawal in an FCPA or money laundering case and “[e]very court to foreclose the withdrawal defense to an accomplice has closely examined the elements and nature of the underlying crime and limited their holding to that crime.” Burks,
C. FCPA Counts
1. Agent of a Domestic Concern
The FCPA provides that it “shall be unlawful for any domestic concern ... or for any officer, director, employee, or agent of such domestic concern ... to make use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay, or authorization of the payment of any money, or offer, gift, promise to give, or authorization of the giving of anything of value tо” a foreign official. 15 U.S.C. § 78dd-2(a).
As Defendant acknowledges, the Indictment alleges that he “was an agent of a ‘domestic concern,’ [Alstom Power U.S.], as that term is used in the FCPA.” (Indictment ¶ 13.) He nevertheless contends that “because the Indictment by its own words describes him as something other than an ‘agent,’ ” it is facially deficient and has “failed to allege a crime.” (Reply at 8-9.) Citing United States v. Aleynikov,
In Aleynikov, the Second Circuit held that an indictment was “legally insufficient” where it charged the defendant with theft of “computer source code” under the National Stolen Property Act, 18 U.S.C. § 2314, which criminalizes interstate transportation of any stolen “goods, wares, merchandise, securities or money.” The Second Circuit held the “plain and ordinary meaning” of the statute demonstrated that it applied only to tangible items and that “source code” did not constitute “goods,” “wares,” or “merchandise.”
The FCPA does not define the term “agent” and “[w]here no definition is provided, courts first ‘consider the ordinary, common-sense meaning of the words,’ ” United States v. Bodmer,
The existence of an agency relationship is a “highly factual” inquiry, considering factors, such as “the situation of the parties, their relations to one another, and the business in which they are engaged; the general usages of the business in question and the purported principal’s business methods; the nature of the subject matters and the circumstances under which the business is done.” Cleveland v. Caplaw Enterprises,
While Mr. Hoskins is alleged to have been employed by non-“domestie concern” Alstom, rather than its domestic subsidiary Alstom Power U.S., based in Connecticut, the Indictment alleges that Mr. Hoskins “was responsible for retaining consultants in connection” with the efforts of both Alstom and Alstom Power U.S.’s “efforts to obtain and retain contracts in Asia, including Consultant A and Consultant B for the Tarahan Project, knowing that a portion of the payments” was intended to be bribes, and outlinеs Defendant’s efforts on behalf of Alstom Power U.S. in this regard. ' (Indictment ¶¶ 13, 58, 66-67, 69-70.)
Unlike in Aleynikov where the court could independently determine without any factual record if “computer source code” was a “good” as used in the statute, whether Mr. Hoskins acted as an agent of Al-stom Power U.S. despite being titled as an executive of its parent company is necessarily the kind of factual question that cannot be decided pre-trial.
2. Constitutional Challenge
Next, Defendant contends that if the FCPA can be interpreted to include him within the definition of an agent of a domestic concern, the statute is “unconstitutionally vague as” applied, because “Mr. Hoskins could not have had fair notice that his conduct as a member of the parent company — overseeing, approving, and authorizing certain activity of subsidiary companies — could somehow result in a conclusion that he was acting under the control of a subsidiary company.” (Def.’s Mem. Supp. at 30.)
A constitutionаl vagueness challenge seeks to bar enforcement of “a statute which either forbids or requires the doing of an act in terms so vague that [individuals] of common intelligence must necessarily guess at its meaning and differ as to its application.” United States v. Lanier,
Defendant does not contend that the FCPA is vague as to the conduct prohibited — bribery of foreign officials — or that the term “agent” is necessarily ambiguous. Rather, Defendant . contends that the FCPA is unconstitutionally vague as applied to him because (1) applying the term “agent” to Mr. Hoskins, “contravenes the statute’s plain meaning;” (2) “because the term agent is facially clear, any interpretation drawing Mr. Hoskins within its scope would constitute judicial overreach;” and (3) “any contrary interpretation of the term ■ ‘agent’ as used in the FCPA would render that term ambiguous and, as such, the rule of lenity would apply.” (Def.’s Mеm. Supp. at 31-33.)
The Government counters that “the defendant’s conduct is unambiguous: he corruptly negotiated consultancy agreements to conceal a considerable bribe scheme whereby Alstom Power U.S. bribed a high-ranking member of the Indonesian Parliament and PLN officials. In so doing, he had over 100 communications to and from the U.S. persons on whose behalf he worked, arranged a sham consulting agreement with a U.S. resident, and set up a schedule of the bribe payments to be paid out of Connecticut by Alstom Power U.S. to the U.S. consultant.” (Gov’t’s Opp’n at 36.)
Defendant’s vagueness argument is a subspecies of his argument that he does not fall within the definition of the term “agent” and the resolution of his “as аpplied” challenge will require a more expansive factual record to be developed at trial regarding the “highly factual” nature of the alleged agency relationship. See Cleveland,
S. Extraterritorial Application
Defendant contends that' the FCPA does not apply extraterritorially to non-U.S. persons, such as himself. (Def.’s Mem. Supp. at 35.) However, the Indictment charges domestic conduct, alleging that “in the District of Connecticut and elsewhere, HOSKINS and POMPONI, being domestic concerns аnd employees and agents of a domestic concern, did willfully use and cause to be used the mails and means and instrumentalities of interstate commerce corruptly in furtherance of’ a payment to a foreign official. (Indictment ¶ 102.) That Mr. Hoskins may have never entered the United States in connection with his Alstom employment (Hoskins Aff. ¶ 9) is not dispositive because his physical presence within the United States is not required where the Indictment alleges that he used domestic wire transfers to promote the conspiracy, see Matter of Marc Rich & Co., A.G.,
D. Venue for Money Laundering Charges
Finally, Defendant contends that venue for the money laundering counts is-not proper in the District of Connecticut, because “[t]here is no allegation that the predicate financial transactions were conducted in the District of Connecticut” and “the Indictment alleges, instead, that the transactions were conducted (ie., initiated) from Maryland by a third-party consultant (long after Mr. Hoskins left Alstom).” (Def.’s Mem. Supp. at 39.) As the Government notes, the monеy laundering statute provides that venue lies in “any district in which the financial or monetary transaction is conducted,” 18 U.S.C. § 1956(i)(l)(A), and that, “a transfer of funds from [one] place to another, by wire or any other means, shall constitute a single, continuing transaction. Any person who conducts!
The Indictment alleges that, “HOSKINS ..., while located in the District of Connecticut and elsewhere, directed the wire transfer of, and caused to be wired, money from [Alstom U.S. Power’s] and Consortium Partner’s bank accounts in New York to Consultant A’s bank account in Maryland for the purpose of concealing and disguising the bribe payments to Official 1.” (Indictment ¶ 107.) Under 18 U.S.C. § 1956(i)(3) venue lies in the District of Connecticut. See United States v. Harris,
In his reply brief, Defendant contends for the first time that if the Government’s theory is accepted — that the money-laundering counts charge a “continuing transaction” begun in Connecticut and completed in Indonesia, making venue proper in this District — then the money-laundering counts and the FCPA counts are necessarily multiplicitous. (Reply at 14.) “An indictment is multiplicitous when it charges a single offense as an offense multiple times, in separate counts, when, in law and fact, only one crime has been committed.” United States v. Chacko,
“[T]he standard for analyzing whether offenses are the same in law is the same-elements test established in Blockburger v. United States, [
Defendant does not contend that the Blockburger test is 'violated, but instead that “the Supreme Court has recognized that when one charge may be subsumed by another, it is appropriate to look beyond the statutory elements to consider the substance of the allegations.” (Reply at 14 (citing Whalen v. United States,
Furthermore, the pretrial dismissal of the Indictment on the basis of multiplicity would be “premature,” because “[w]here there has been no prior conviction or acquittal, the Double Jeopardy Clause does not protect against simultaneous prosecutions for the same offense, so long as no more than one punishment is eventually imposed.” United States v. Josephberg,
III. Conclusion
For the reasons set forth above, Defendant’s Motion [Doc. # 149] to Dismiss is DENIED.
IT IS SO ORDERED. .
Notes
. Mr. Hoskins was arrested on April 23, 2014 upon entering the United States Virgin Islands en route to Dallas to visit his son and contends that he was unaware of the Indictment prior to his arrest. (Hoskins Aff. ¶ 13.)
. The co-deféndants in this case have all pled guilty. Frederic Pierucci, the head of global boiler sales who was based at Alstom Power U.S. during the scheme, pled guilty [Doc. #44] on July 29, 2013, to Counts One and Two of the first superseding indictment. William Pomponi, a vice president of regional sales at Alstom Power U.S., pled guilty [Doc. # 142] on July 18, 2014, to Count One of the Indictment. David Rothschild, a vice president of regional sales at Alstom Power U.S., pled guilty to a one-count information charging him with conspiracy to violate the FCPA. See United States v. Rothschild, No. 12cr223 (JBA) [Doc. # 7]; (Notice of Related Case [Doc. #185]).
. Effective December 1, 2014, after the instant motion was filed, amendments to Rule 12 became effective. Because the amendment to Rule 12(b)(1) only alters the language slightly but “[n]o change in meaning is in
. Defendant incorrectly posits that United States v. U.S. Gypsum Co.,
. Defendant contends that "in the more than one million pages of discovery and witness statements produced by the government to date, there is not one document demonstrating that Mr. Hoskins had any involvement or contact with the conspiracy or any conspirators after his departure from Alstom” (Def.’s Mem. Supp. at 18) and "there is simply no evidence that Mr. Hoskins promoted or benefited from the alleged conspiracy after he departed Alstom in 2004” (Reply at 4). However, the absence of evidence known to Defendant to support an affirmative defense is not grounds to dismiss the Indictment. See Sisson,
. Defendant contends that "Smith demonstrates that a defendant cannot be held responsible for substantive crimes committed by co-conspirators after his withdrawal and, further, that withdrawal alsо triggers the statute of limitations with respect to any other charges.” (Reply at 7.) Although Smith noted that " [withdrawal terminates the defendant's liability for postwithdrawal acts of his co-conspirators, but he remains guilty of conspiracy,”
. Likewise in Van Riper v. United States,
. Aleynikov was decided post-trial but both parties "frame[d] their arguments in terms of the sufficiency of the indictment rather than the sufficiency of the evidence,” and the Second Circuit noted that "the result and analysis would be the same under either formulation.”
. The term "conducts” is defined as including "initiating, concluding, or participating in initiating, or concluding a transaction.” 18 U.S.C. § 1956(c)(2).