Northampton County’s 1861 Court Room!!

Finding the diamond in the rough. That describes my recent drive to the Northampton County Courthouse. As my law practice takes me from the Philadelphia’s suburban counties to northeastern Pennsylvania, I routinely travel on the Pennsylvania Turnpike and its Northeast extension.
The drive this July week was rough. The weather forecast proved accurate; rain and fog through the Lehigh Valley. It was raining so hard, I missed my exit off Rt 476E at Rt 22 E. I drove an additional 20 miles each direction, turning around in Jim Thorpe. (I love the Carbon County Courthouse – see my other blogs – but I was not going there today.)
 I was uncharacteristically late, arriving at 9:25 am for a 9:00 am hearing.  I was otherwise safe.  The judge was extremely gracious and polite. The case was handled quickly.  Opposing counsel – a local assistant district attorney – offered a tour of the courthouse as I expressed my appreciation for our hearing taking place in the old courthouse, courtroom 3, as compared to the new 2004 building.
The county website states, “The original court house was built in  1764. Nearly a century later and after the courthouse had experienced a number of historical events, which included being used as a barracks by Revolutionary troops, a group of citizens petitioned for a new County Courthouse at a different location. On August 23, 1860, the County Commissioners decided to accept land offered at a price of $1.00 that was located several blocks west of the original facility.   A new brick structure was later built on a steep hill at a cost of $53,000. The first term of court was held in the new facility on June 18, 1861.  Since then, two additional wings were constructed to accommodate the growth of Northampton County and satisfy the judicial needs of the expanded population.  The second part of the courthouse was built in 1978 and the third in 2004. “
I was interested in the 1861 building and court room 1.  Finished at the out set of the Civil War.   Wow!! A majestic legal theater, refurbished in 1978 to match the import to the community when the courthouse was built. Original woodwork, plaster, and paint are renewed. County Commissioners rightfully chose to not clutter the court room with of a phalanx of computer cables, microphones, and other modern day accoutrements that clutter some other county courtrooms in which I practice.
The pictures below reveal the courtroom’s grand entrance, judicial bench, and the jury box of the times. The remarkable woodwork and attention to detail immediately reveals itself. The artisans of Pennsylvania’s counties knew their work would be on display at every important and public event of the times. The honor and respect they earned working for their local government on the most important building in the county.

Call a Lawyer, Not the Licensing Board, When Contacted by Board Counsel or Investigators

My administrative law practice takes me before many of Pennsylvania’s licensing boards and in hearings that address a variety of disciplinary actions.  It is during Pennsylvania’s professional licensing boards’ bimonthly meetings that disciplinary matters are commenced, reviewed, or finalized.  This is why after a given board’s monthly meeting I typically receive a wave of calls from new clients, mail that initiates disciplinary action in pending cases, or final decisions in cases.

Potential disciplinary actions a board may commence include: 1) reciprocal disciplinary actions; 2) emergency petitions to immediately take a license; 3) objections to license applications; 4)  approval of different consent agreements; 5) approval or rejection of hearing officer’s proposed adjudications; and 6) reviewing cases sent back from the Commonwealth Court for issuance of revised disciplinary action. Also, several boards have subcommittees that approve probable cause petitions compelling licensees to undergo mental and physical of evaluations.

After bimonthly board meetings I receive calls from both current or potential clients inquiring “What I should do? Who should I talk to?  or What information should be disclosed?   Many callers disclose prior conversations with board counsel, investigators, PHMP assessors, or other board representatives. I cringe when I hear this.

 

Board representatives, prosecutors, administrators, and/or medical professionals do not represent the licensee. These people are tasked with enforcing board regulations. They are tasked with complying with each and every administrative procedural requirement (of which the licensee has no idea). They are tasked with securing information against the licensee who is potentially, or actually, subject to disciplinary action. These people do not look out for the best interest of the licensee.  DO NOT TALK TO THESE PEOPLE ABOUT YOUR CASE, FACTS, OR MEDICAL CONDITIONS.  THEY WRITE EVERYTHING DOWN.

 

Board administrators and PHMP office staff are not sophisticated licensed professionals. They are unfamiliar with the actual medical issues, legal issues, or licensing process. They merely perform administrative functions. They lack any authority to adjust, regulate, or modify any correspondence.  Relying upon statements from these administrative level workers is frustrating and leads to incorrect practices.

 

I have heard on many occasions board clerical staff and social workers advise licensees and/or license applicants to cooperate – give statements or do other inaccurate suggestions – that are not in the licensees best interest.  Administrative workers routinely do not recommend hiring counsel to secure a better, more complete, or correct legal advice on how to respond to the legal correspondence  just received in the mail.

 

That is why I say do not contact these boards, rely upon what any administrator says, or even hope that they give you correct advice. Call an attorney and secure proper legal advice.  The best analogy I can give is: Do you call a doctor’s office and follow medical advice dispensed by the phone receptionist or want to talk to RN, LPN, or M.D.?  The obvious answer is no.  So why would you do that when calling a licensing board about your professional license you utilize every day?

 

Please call me to discuss the recent board ordered disciplinary correspondence you just received!

Try to Recognize when an Attorney is Needed

When is it important to hire an attorney in a licensing and criminal defense case? When case agent first contacts you!  Do not talk to them.  Just say thank you, I will call you back; can we meet next week; no you can not come into my house!!
Every day licensing board investigators, police detectives, human resource departments, or other government investigators reach out to targets or “individuals of interest” in a wide range of potential investigations. These law enforcement officers (most state investigators are retired police detectives) are trained to secure statements from the subject of the investigation.  They call you, show up at your house, or try to meet with you at work.  This is when you know you need a lawyer.

My blogs generate phone calls from potential clients.  A recent theme of these calls sticks out;  investigators are employing consistent, heightened and aggressive investigative techniques to surreptitiously secure statements and admissions of criminal conduct, unprofessional licensing behavior, or illegal behavior.  This is explained in one sentence; why do an investigation when an admission from the target will solve the case.

Targets give statements for one reason: ignorance and naïve understanding of the law.   Targets  or potential criminal defendants give statements because they think they are obligated to cooperate, should cooperate, or that cooperating is in their best interest.  These reasons are incorrect.
Admitting to engaging in questionable or criminal conduct eliminates investigator’s obligation and duty of proving their case through means other than an admission by the target.  Admissions to detectives and investigators eliminates their need to perform basic investigator police work.  It satisfies  the police officer’s burden of proof in securing evidence of illegal or criminal conduct against you.
Licensees who admit to a Board investigator to practicing outside the scope of their license, stealing from their clients, overcharging for services, or any other offense does the investigator’s job.  In many cases, before the statement is secured, there is only a mere suspicion of inappropriate behavior.  There is no specific evidence of a criminal act. The statement itself becomes the evidence against you. The person giving the statement creates the criminal evidence for the investigator that they did not otherwise have.   (I feel the same way  about licensees who cooperate in the PHMP VRP assessments.  Do not give the Board’s any evidence they do not have.)
Once a criminal admission is given, the police officers don’t do anymore work. The state investigators don’t do anymore work. This is why there is no legal obligation to cooperate.
Giving statements to employers in work place investigations has the same ultimate result. I have written about this many times. Choosing to not give a blood test, write a personal statement, or even provide copies of medical records cannot be held against you. You can be fired, but it can’t be held against you. At times it’s more important to choose to remain silent then to keep your job.  Anything you say in the employment setting is merely turned over to the board investigator or police.
Remaining silent and not cooperating with any investigation  — not disclosing truly damaging information — sometimes is the best defense of your license or against criminal charges.  Do not succumb to the police officer bullying. Suggestions by police that they can secure search or arrest warrants should not persuade you to give up your constitutional rights.
You do not have to give a statement. You do not have to give a DNA test. You do not have to participate in any polygraph evaluation.   If the officer does not believe your word or accept your version of events, agreeing to provide objective forensic evidence will not change their mind. You will just be giving them evidence to accumulate and use against you at a later date.
Hopefully you have the opportunity to read this blog before you have spoken to an investigator about a licensing issue, participated in the workplace related investigation, or cooperated with any police inquiry inquiry about your job or your behavior. If not, call me as soon as possible.
Whether you hire me or any other lawyer, stop stop cooperating with any police investigation.

Road Riding in the Counties

My personal and business travel is taking me to more counties throughout the Commonwealth of Pennsylvania than ever before. The local courthouse houses in the county seats are really interesting for me. The court houses — arenas of legal combat — are throw backs to more glorious days when the local big trial was the event of the year.
In the past I took for granted these architectural gems that are spread throughout the various townships and boroughs within which I practice.   Now, I seek out and explore the courthouses. Whether by car or bike, I am having fun.
This spring I bought myself a road bike. I ride ferociously around the eastern part of Pennsylvania. I have the pleasure of routinely riding through Philadelphia,  Conshohocken, Norristown, and Valley Forge Park. All are within 5-15 miles of my house.  Sometimes I ride from my house to Philadelphia and back.
A recent Saturday took me on a further ride — from West Chester to the City of Lancaster. The road ride began in West Chester and ended in Lancaster County, behind the Court House. We departed West Chester through its southern rolling-hills of Brandywine Township. We followed Brandywine Creek through East Bradford Township, Downingtown  to West Fallowfield Township. One word — marvelous.
After 90 minutes the group ride, with me at the back of the pack, entered Lancaster County. I was greeted by signs for farm fresh brown eggs, personally constructed homes, garages, sheds, and wonderful antique tractors.
Tractors, tractors, tractors. But not your ordinary tractors.  These were green, yellow and red tractors, pulled by horses. The drawn mowing tractors were hard at work, gas free, mowing lawns and fields. Some tractors were too tired to work, gathering rust. There was no worry about rubber tires rotting. Metal wheels needed no repairs.
The morning aromas changed with each turn in the road. Pungent cow, horse, pig dung awoke my sinuses.  Crushed wild blackberries and dripping vines of honeysuckles permeated homesteads. The morning dew clung to grass blades and tree branches through the Brandywine Creek bike route. Entering Lancaster and riding down Duke Street brought with it fresh bakery smells and the Lancaster County brewing Company.
In each county seat, I look for a small coffee shop. Lancaster’s Prince Street Café did not disappoint. The fresh cappuccino after a 50 mile ride awakened all of my exhausted senses. Orange juice and fresh eggs on a croissant made me even happier. The pictures below reflects the quaintness of the café and the wonderful effort the bakers and barista’s gave the Saturday morning breakfast crowd.
An unexpected joy came as I began to get ready for my drive home. Just to the west of the Prince Street Café is the Lancaster County Donuts Shop. Homemade donuts and holes are sold with every conceivable topping — as if I was in an ice cream shop — tantalized my taste buds. The sublime chocolate with vanilla cream cheese frosting carried me through the rest of my day.
I could not have been happier. Content and satisfied by a hard work out, great ride with new friends and a bulging stomach.  Blair and Clearfield counties also did not disappoint. I’ll keep you posted.

Professional License Indefinite Suspensions for Missing the Mental and Physical Evaluation

Board authority to  compel a mental and physical examination(“MPE”)  is pursuant to 63 P. S. § 2205(D)(1).  The purpose of the evaluation is to determine whether, under 63 P. S. 224(a)(2) for nurses, a licensee is unable to practice their profession with reasonable skill and safety by reason of mental or physical illness or condition or psychological or physiological dependence on alcohol, hallucinogenic on narcotic or other drugs that impair judgment and coordination.  Similar impairment evaluation provisions are contained in each of the twenty six different Pennsylvania licensing schemes.

A formal board order compelling attendance always accompanies these Petitions.  The Board signs the order to compel both attendance and compliance with document production requirements.  Typically, these petitions are filed, licensees show up at the expert’s office for the examination compliant with the terms and conditions of the MPE order.  It is the unique case where a licensee does not show up and their license is summarily suspended.

License suspension is based upon the Pennsylvania Code provisions that states,  if a licensee fails to attend the MPE,  the allegations of impairment are deemed true.  The admissions of fact and law allow the Board to conclude impairment and formal suspension is ordered.   License reinstatement after this step requires attending a PHMP expert evaluation (at the licensee’s expense) and complying with all other aspects of the suspension order.
Why or how would a licensee not go to the Mental and Physical Evaluation?  Failure to maintain an up-to-date address with one’s Pennsylvania licensing board, resulting in missed notices is the first way. Secondly, thinking these appointments can be unilaterally changed or failing to properly communicate scheduling conflicts create huge problems.  Minor inconveniences though do not warrant not attending the procedure.  The last way is the simplest; a licensee simply does not attend the evaluation for fear of the result.
Case law discussing these provisions specifically requires proper Board notification of the MPE and suspension to the licensee’s address of record.  The address on record is the address to which the Board is required to provide notice of a disciplinary action in order to honor its constitutional due process obligations.  The Board only needs to provide proof of service via regular and certified mail.  It is licensees burden to attend or reschedule the evaluation.
Why do licensees have to go to these evaluations?  Section 224(a)(2) of the Nursing law, for example, is the standard provision in every regulatory board scheme.  Board prosecutors receive information suggesting an impairment.   In seeking licensure, licensees agree to be regulated by the State.  Licensees agree to honor the provisions of Pennsylvania code and case law interpreting the code.

The MPE is just such a provision in an over arching regulatory scheme the Commonwealth has erected to protect its citizens from errant and high licensees (realtors, doctors, pharmacists, nurses and the like).  My blogs deal with my role in preparing each licensee for the MPE. However, I cannot accept mail for each licensee. Once we are retained, I am able to re-scheduled the MPE with consent of either the doctor, Board counsel or prosecuting counsel.  This allows me time to assist the licensee organize their documents and prepare for this expert examination.  I cannot receive the mail.

The consequence on the licensee of not attending the evaluation is significant. While not immediate, eventual license suspension for failure to honor a Board order will occur. Reinstatement will only take place upon attendance of that MPE.  Additional requirements include providing a criminal background check, proof of compliance with all continuing education burdens, proof of no practice during the term of suspension, and payment of investigatory costs.
As well, included in the typical MPE order is the Board paying for the evaluation.  Once a licensee refuses or fails to attend the MPE, the MPE expert evaluation expense must be borne by the licensees.   Please call me to discuss your recent mail compelling you to attend a mental and physical examination.or suspending your license for missing one.

Major US Supreme Court DUI Decision and Pennsylvania Licensees

On June 23 the United States Supreme Court decided  BIRCHFIELD v. NORTH DAKOTA, three consolidated cases addressing important substantive and procedural legal issues regarding driving under the influence (“DUI”) cases.  In each case, the North Dakota motorist, lawfully arrested or under investigation for drunk driving, was convicted of a separate crime or otherwise received an enhanced criminal penalty for refusing to submit to a warrantless blood test measuring the alcohol in their bloodstream.

All three state court cases results depended upon the proposition that criminal laws ordi­narily may not compel a motorist to give evidence against themselves in the form a blood sample or breath test unless a warrant authorizing such testing is issued by a magistrate.  The specific issue considered was how the search-incident-to-arrest doctrine applies to breath and blood tests incident to DUI arrests. The court ruled while compelled evidence from breath tests are constitutional based upon the limited inconvenience and invasion of privacy to the motorist, compelled blood tests are unconstitutional for those same reasons.

In Pennsylvania, 75 Pa C.S.A. § 1547 of the motor vehicle laws addresses motorists’ civil license suspension consequences for refusing to submit to a DUI investigation breath or blood test. Depending on how many refusals the operator of the car has previously engaged, a driver’s license suspension based upon a breath or blood test refusal starts at one year and may escalate. The court ruled that these civil collateral consequence license suspension for refusing the test remains constitutional. “Our prior opinions have referred approvingly to the gen­eral concept of implied-consent laws that impose civil penalties and evidentiary consequences on motorists who refuse to comply.”The Birchfield case did not question the constitutionality of those civil collateral consequence refusal laws, and the Supreme Court limited its ruling stating that “nothing should be read to cast doubt on them.”

In 2015 the Supreme Court ruled that the natural dissipation of alcohol from the bloodstream does not always constitute an exigency justifying the warrantless taking of a blood sample. That was the holding of Missouri v. McNeely, 569 U. S. ___, where the State of Mis­souri was seeking a per se rule that “whenever an officer has probable cause to believe an individual has been driving under the influence of alcohol, exigent circum­stances will necessarily exist because BAC evidence is inherently evanescent.”  This case set the stage for Birchfield, where the individual defendant’s objected to being criminally penalized for not submitting to the warrantless blood draw or were criminally penalized when the warrantless blood draw produced evidence that was used against them in trial.

Pennsylvania’s DUI statute, 75 Pa.C.S.A.§3802D, provides for enhanced criminal penalties for refusing to submit to a breath or blood test stemming from a DUI investigation. DUI offenders with multiple prior DUI convictions faced enhanced license suspensions and jail sentences based upon the same refusal. In Birchfield, after reviewing all of the prior case law regarding car stops, privacy concerns, and search incident to arrest case law, the court held that motorists cannot be deemed to have consented to submit to a blood test on pain of committing a criminal offense.  Motorists can not be compelled criminally to give evidence against themselves without a warrant signed by an independent magistrate.
The court has finally drawn a constitutional line in the sand limiting the extent to which a state may utilize driving-on-our-roads informed consent laws to compel motorists to give evidence against themselves so the state may investigate and prosecute them for criminal conduct. In Pennsylvania, this will mean enhanced criminal penalties associated with refusing a blood test, not breathalyzer, in any criminal DUI prosecution may no longer be constitutionally permissible.  Please call to discuss your DUI charge, your medical or professional license issue and potential discipline on your license from stemming from your first or subsequent DUI.

Drug Act Convictions and Automatic Suspensions

Pennsylvania’s licensing boards have become very proactive in learning of professional’s criminal convictions for violating Pennsylvania Drug and Cosmetic Act – 35 P.S. § 780–113 (a). Once learned, licensing board prosecutors aggressively file petitions for automatic suspensions of professionals’ licenses. At issue is whether the Boards impose, per Drug Act offense, the one year maximum suspension or a suspension for a lesser amount of time and concurrent versus consecutive for each violation.

If the proper attorney handles both the criminal case involving Drug Act allegations and the consequential administrative licensing disciplinary action, the probability of a better total result is clear. In September 2015 I wrote a blog on this exact legal issue. September 2015 Blog

In that blog, I set forth that the Drug Act, § 113(a) lists thirty six illegal actions involving drugs, prescriptions, record keeping, and other pharmaceutical issues. Section 780- 113(b) identifies which of those thirty six offenses are either felonies or misdemeanors and their respective jail penalties. Drug Act sections 780-123(b)&(c) identify a separate penalty solely targeting the licensed practitioner who is convicted of, or pleads guilty to, either a misdemeanor or felony offense set forth in 35 P.S. § 780-113(a).

When representing the licensed practitioner, 35 P.S. § 780-123(b) & (c) dictates the priority of negotiating a guilty plea to a non-Drug Act offense. An initial goal is to avoid any Drug Act criminal charge and/or conviction. A secondary goal on cases involving drugs is to secure misdemeanor graded Drug Act violations over felonies.

How these cases are defended criminally – with an eye towards the license context — is hugely important. Non-drug use or contraband related Drug Act violations need to be clearly discussed in any guilty plea. The guilty plea hearing should include a recitation of facts explicitly eliminating any question that the plea is for personal consumption conduct. The guilty plea colloquy must clearly spell out the absence of evidence regarding drug diversion, positive drug tests, or inferences of personal consumption.

In many Drug Act cases, specious criminal charges are filed for tenuous record keeping violations, charting errors, or untimely prescription dispensing errors. In these cases, the guilty plea must identify the charting errors, dispensing mistakes, or the nature and manner of typical prescription dispensing negligence that forms the foundation of the criminal charges. Emphasizing the non-diversion facts here is important as the Board will consider such when the professional suspension is decided.

Once convicted, how and what is included in the professional’s mandatory notification to the professional board is important. Attach the guilty plea transcript that sets forth the non-diversion factual predicate of the plea. The professional, through counsel, should request the Board to exercise its discretion in not instituting the automatic one year suspension, but some lesser amount. If necessary, file an application to stay the automatic suspension and an answer to the prosecutor’s motion, contesting the Board’s discretionary implementation of a one year suspension.

The perception that automatic one year suspensions are mandatory rather than discretionary stops many licensees from contesting these petitions. Applications for a stay of any license suspension in conjunction with an application answering the petition for an automatic suspension should be filed. Appropriate legal averments and complex legal strategy is necessary to stop any automatic license suspension from going into effect.

A case I recently handled, for which the proposed adjudication has yet to be handled down, is on point. It is an abuse of discretion to impose a one-year suspension of a professional’s license for old convictions that are not related to the use or diversion of any narcotics. Please call me to discuss these issues to properly insure either your license is not suspended for the one year maximum for each Drug Act conviction.

Federal Sentencing Issues: Calculation of Loss — Great Decision

On September 30, 2015, the Third Circuit decided United States v. Nagle, 2015 U.S. App. LEXIS 17187. Joseph Nagle and Ernest Fink appealed the District Court’s calculation of loss from which their lengthy prison sentences were derived. For federal sentencing fanatics, of which I am one, Nagle is momentous for reversing the District Court’s USSG actual loss sentencing enhancement.

In the 1950’s Nagle’s family formed Schuylkill Products, Inc. (“SPI”), a Pennsylvania manufacturer of concrete beams utilized in highway and mass transit construction projects. In 2004 Joseph Nagle inherited a 50.1% interest in SPI, becoming CEO. In 1993 CDS Engineers, Inc., was formed. Fink owned 49.9% and was Vice President and general manager. After 2004 SPI became a wholly-owned subsidiary of SPI, installing SPI’s manufactured concrete beams.

Federal regulations require states utilizing federal highway funds to establish and meet goals of participation for qualified disadvantaged business enterprises (“DBEs”). The DBE must be certified and perform a commercially useful function in the project. The DBE cannot be a fabricated front for an otherwise non-certified DBE. Neither SPI nor CDS were certified DBEs. Marikina Engineers and Construction Corp (“Marikina”) was a Connecticut based certified DBE subcontractor.

SPI and CDS paid Marikina a fixed fee for DBE participation in SEPTA and PennDOT contracts but kept the contracts’ profits. Nagle, through CDS, prepared and submitted project applications utilizing Marikina’s email and stationary. SPI accessed electronic PennDOT contract management systems through Marikina’s login passwords. SPI employees carried Marikina’s business cards and cellular telephones. During the conspiracy, Marikina received $54 million in SEPTA DBE contracts and over $119 million in PennDOT contracts.

Nagle and Fink were charged with and convicted of orchestrating a scheme between 1993-2008 of utilizing Marikina to bid for PennDOT and SEPTA DBE construction projects which SPI and CDS would perform but were otherwise not entitled as a non-DBE. Prior to Nagle’s trial, Fink and three of Marikina’s principles plead guilty.

As a fraud case, the sentencing court first looks at United States Sentencing Guideline (“USSG”) § 2B1.1 for the offense level associated with a specific amount of fraud. Subsection (b) lists adjustments based upon the amount of loss. As the loss increases, offense levels unscientifically increase. (A loss between $70,000 and $119,999 adds eight to the offense level. A loss over $1 million but less than $2.5 million increases 18 offense levels. Losses between $50 and $100 million allow for a 24 level increase.)

On June 30, 2010 the District Court concluded that USSG § 2B1.1(b) required Fink’s loss to equal the contracts’ face value, $135.8 million. This occurred in Nagle’s co-defendant’s case. United States v. Campbell, 2010 U.S. Dist. LEXIS 65770 (M.D. Pa., June 30, 2010). The Court employed USSG § 2B1.1, cmt.n.3(F)(ii) as the case was associated with fraudulent receipt of government benefits.

Note 3(F)(ii) reads “in a case involving government benefits (grants, loans, entitlement program payments), the loss shall be considered to be not less than the value of the benefits obtained by the unintended recipient.” The court held that § 2B1.1 cmt.n.3(A) defines actual loss as the reasonably foreseeable pecuniary harm that resulted from the offense. The court determined Note 3(A) applicable because Marikina, SPI, and CDS defendants were unintended recipients of DBE funds not entitled to a credit for services rendered and they had not refunded the contract price to allow for an eligible DBE to perform the work.

After his conviction, Nagle’s presentence report relied on the Court’s June 2010 opinion to value his § 2B1.1(b) cmt.n.3(A) loss at $54 million. This increased by 24 Nagle’s offense level calculus. Nagle’s objections, similar to Fink’s which were held under advisement until after Nagle’s trial, argued the loss is offset by the value of services rendered based upon § 2B1.1 cmt.n.3(A), United States v. White, 2012 WL 4513489 (SDNY Oct 2, 2012), and its interpretation of U.S.S.G. §2B1.1(1)(h). There the court offset the loss with the value of services provided, resulting in a 14, not 24, offense level increase. The District Court reviewed § 2B1.1(b) and (h) and rejected White.

Nagle’s cumulative offense level was 40. When combined with a Zone I criminal history his jail range was 292-365 months. Nagle received eighty four (84) months in prison. No restitution was ordered. The court concluded the Government received what it paid for in the contracts. United States v. Nagle, 2014 U.S. District Lexis 63033 (M.d.Pa. May 2014).

In reversing the District Court’s loss calculation of $54 million against Nagle, the appeals court focuses on the concepts of fraud and theft, not the USSG. In theft cases, a victim’s loss is equal to the value of the theft for which nothing is received in return. Here, a loss calculation is truly a gage of the injury inflicted.

In fraud cases, however, value passes in each direction of the transaction. Real estate secured through fraud still possesses value which can be sold to mitigate a victim’s losses. The court recognizes this analysis is an accepted ‘value of loss’ mitigation tool in mortgage fraud jurisprudence. Since 1999 the Third Circuit has also applied net loss to federal procurement fraud cases; the value of components provided reduces the § 2B1.1(b) actual loss value calculation. In adopting this reasoning to DBE fraud cases, the appeals court daftly reasserts District Courts’ authority to determine loss outside the constraints of the non-scientifically derived, and now discretionary, sentencing guidelines.

The court did comply with its obligatory responsibility of evaluating USSG definitions. After a lengthy analysis of the parties’ positions, the court rejects the government’s and Congress’ one size fits all (you stole therefore you disgorge) windfall argument. The court turned to § 2B1.1 cmt.n.3(E)(i) to buttress its fraud based conclusion that credit must be given for services and goods provided. The Court also rejects the government’s argument that solely because SPI and CDS were not the intended beneficiaries of the DBE program they could not render a valuable service.

The court’s fraud analysis compels its ruling that in DBE cases value of loss is reached only after subtracting the fair market value of labor and materials rendered and of transporting and storing the materials. This is momentous. In DBE fraud prosecutions, the government must now conduct pre-indictment contract profit analysis. Profit size and distribution, shareholders versus private corporate owners, could become a major factor in the decision to criminally charge corporate officers in DBE and other government fraud cases.

For several years district courts have enjoyed renewed latitude in sentencing defendants. Noteworthy judicial objections to specious mandatory minimum sentences and unscientific USSG offense level enhancements appear in opinions and newspapers monthly. Nagle follows this trend by limiting the Guideline’s and Congressional intent to punish through vastly overvaluing a monetary benefit to individual corporate officer defendants based solely upon the gross value of the government contract. In Nagle the Third Circuit gives district courts more sentencing authority by eliminating mandatory judicial compliance with USSG policy of exorbitant sentences enhancements randomly assigned from monetary value that lack any relation to an appropriate sentence.

Offense level calculations typically determine the high water mark of a defendant’s potential sentence. Nagle is noteworthy because it limits Guideline escalation of offense levels through arbitrary enhancements which raise suggested time of incarceration. This restriction, in turn, reinforces district courts’ sentencing discretion to vary or depart downward because that analysis will now simply start at a lower offense level. Nagle invigorates the argument that speciously derived and arbitrary USSG enhancements pursuant to the § 2B1.1(b) monetary loss figures will no longer dictate district courts’ sentences.

Nagle furthers the Supreme Court’s goal of bringing equity and sensibility to sentencing decisions. The gross cost of government contracts, for which services and goods are properly rendered, is now appropriately excluded as a basis for sentencing enhancements. To the extent the government, and thus the country’s citizens, receive the ultimate intended benefit of the federal transportation highway program (properly designed and built roads, bridges, and mass transit) the government is not entitled to a windfall and not pay for the services. Only illegally secured profits will factor into a sentencing scheme.

Your IPAD and Text Communications…No Expectation of Privacy…Sanctioned Police Conduct

This blog addresses a significant development in Pennsylvania Court’s judicial approval of a new police investigation method involving iPads and text communications. The recent case of Commonwealth v Diego, reviewed and sanctioned police departments ease dropping on a Pennsylvania citizen’s electronic communications conducted over Skype, a Wi-Fi signal, or on an iPad without a warrant.

I have written extensively on this topic as it pertains to Pennsylvania Wire Tap Act, 18 Pa. C.S.A. § 5702. My articles  are located on my website publications page, http://www.phila-criminal-lawyer.com/Publications/New-Wire-Tap-Act.shtml , and HB 2400 Balances Privacy Interests and Law Enforcement Needs, http://www.phila-criminal-lawyer.com/Publications/Cell-Phones.shtml.   I have written about the federal counterpart, the Stored Communications Act. That article is found at High Court’s GPS Ruling May Have Minimal Impact

 

 

 

​In ​Diego, the issue is was is an “interception” of an electronic communication – a text message.  Diego unknowingly planned criminal activity with a police confidential informant (“CI”) through text messages.  The CI received Diego’s texts regarding a drug transaction on his personal iPad while in the basement of the local police department with several detectives in the room. The CI engaged in the texting with Diego, who was organizing and scheduling a drug transaction.  Importantly, the CI then either relayed the information in the texts to the officers or they watched the texts in real time.  The drug transaction was then executed and Diego was arrested.  The police did not secure judicial or district attorney approval under the Wire Tap Act to engage any the conduct described.  They simply placed the CI in their office and had him text Diego.

After his arrest and securing discovery, Diego filed a motion to suppress, seeking to preclude introduction into evidence his phone number and thus identity and his text messages. Diego argued that the police department “intercepted” his iPad communications to a third person without a warrant. Diego maintained that the police department’s warrant-less observations of his text messages – a wired, electronic, or oral communication – to the CI were in violation of Pennsylvania’s Wire Tap Act. The Commonwealth claimed texts were not an electronic communication, an IPAD is not covered by the Wire Tap Act, and, alternatively, even if so, Diego did not have a reasonable expectation of privacy in the text messages he sent to the CI. The trial court disagreed and found the police needed a warrant to engage in the conduct and suppressed the evidence.  The Commonwealth appealed.

Superior Court disagreed with the Commonwealth on the first two issues, finding that an iPad is an electronic, mechanical or other device, rendering the Wire Tap Act applicable to the Commonwealth’s use and/or activities of securing information from an electronic device. The Court also found that text messages are electronic communications covered under the Act.

​However, the Diego Court agreed that Diego lacked a reasonable expectation of privacy in the contents of the text message conversation that he conducted with the unknown CI.  “Diego knew or should have known that the conversation was being recorded.” The very act of engaging in a text message communication risks each recipient sharing the contents of that conversation with a third party. For example, leaving a telephone message on an answering machine, sending an email to a chat room communication, or engaging in a group text message necessarily involves less expectation of privacy in that communication because the sender does not know who will be present when the message is retrieved.

​The Court further held that text messages are not private, whether received on an a smartphone or iPad, because the text messaging process does not include an automatic deleting protocol after receipt and review.  The court ruled the sender has a lower expectation of privacy in the text messages because a text message can remain in a recipient’s smart phone indefinitely, regardless of whether the recipient may or may not delete it,  The fact that the messages can or may be deleted is not the operative issue. Rather, it is the fact that they may not be deleted and can remain on the recipient’s electronic device.

The court analogized this factual scenario to a previous ruling in Commonwealth v. DeMarco, 578 A.2d 942 (Pa. Super. 1990).  That case states any reasonable and intelligent person leaving a message on an ordinary answering machine would have to be aware of and consent by conduct to the recording of the message on the answering machine tape. “​Absence some special showing of unique attributes of a particular answering machine cloaking its identity as an answering machine, we cannot imagine how one would not know an intended the message placed upon the answering machine message tape, be taped and by the very act of leaving of the message, expressly consents by conduct to the taping of the message.” This creates a lower expectation of privacy similar to Diego’s text messaging.

​The Diego court differentiated its the facts to those in Riley v. California, 134 S.CT. 2473 (US S.Ct. 2014). There, the Court held that the police cannot search the contents of a “a Smart phone” without obtaining the warrant. The Diego court emphasized that the local police department did not obtain the contents of Diego’s text messaging conversation by searching the CI’s phone incident to arrest. Rather, the CI gave authority to the police to observe the communications in question.

​This is consistent with Pennsylvania decisions in Commonwealth v Cruttenden, 58 A.3d 95 (Pa. 2012) and Commonwealth v Proetto, 771 A.2d 823, (Pa. Super 2001). These cases judicially sanction the police investigatory technique of having a CI or a police officer – posing as a person engaging in criminal activity – use an electronic device without a warrant to communicate directly with a person planning a criminal act.  No “interception” of a communication takes place under either Pennsylvania’s Wire Tap Act or the Federal Stored Communications Act because the target or perpetrator is communicating directly with the intended recipient. In Proetto and Cruttenden, police officers directly communicated with the defendant (cops acting as a criminal too or posing as a potential victim). These courts determined that such was specifically exempted as an intercept under the statute.  This makes sense because new electronic surveillance laws allow police to act without a warrant as a party engaging in criminal activity in order to trick, bait, or entice people to engage in such as part of an investigation.

The real issue in Diego, however, is how the CI gave the police Diego’s texts.  Factually, the court found that the CI engaged in the communication directly with Diego and then merely related the contents of that conversation to the police who were standing across the table from him and not watching the texts as they arrived on his phone.  The court stated this is not an interception under the plain meaning of the Pennsylvania’s Wiretap Act.

The Diego court allows police receive “historical” information in a text message communications from a CI posing as regular citizen engaging in criminal activity with a targeted defendant.  The court instructed that the police CAN NOT, without a warrant, observe real time text messages as such may constitute an interception under Pennsylvania law.

Unfortunately, police participate in CI real-time texting all the time.  It is what probably occurred (but the police lied under oath about it) in the Diego case.  The court ignored reality.  To accept as credible police testimony that their “CI was not typing what they told him and they did not watch real time as Diego’s texts were received in that basement investigation room” is to ignore basic police tactics.  Splitting this investigatory hair to allow police to use a CI to engage in texting, “but not watch the texts as they are received on a CI’s phone”, and have the CI “tell them what the text say,” is a a ridiculous result.  The police did not secure a warrant and the court did not want to suppress the evidence of Diego’s incriminating texts or identity on the Smart Phone

​As long as the police do not directly observe the text message communications, but rather receive them from their confidential informants, Diego now permits this type of police activity.

State Trooper Highway Automobile Dog Searches After the End of Traffic Investigation

This week the United States Supreme Court decided Rodriguez v.United States, 575 U.S. ___ (2015). The decision affirms a significant portion of Pennsylvania law in the area of extension of traffic stops beyond the initial motor vehicle code investigation. I have handled these cases in Cumberland, Lancaster, Montgomery, Bucks and Philadelphia Counties.

These cases routinely involve state troopers illegally extending basic traffic stop investigations into motor vehicle searches. These extended traffic stops discover illegal contraband leading to broader criminal charges. However, it is that extended search, based only upon a guess, hunch, or a simple illegal request to search, that is illegal.

Rodriguez v. United States rules illegal the extension of a traffic stop by calling in a dog sniff team without reasonable suspicion of criminal activity. The US Supreme Court previously stated that a dog sniff conducted during a lawful traffic stop does not violate the fourth amendment proscription unreasonable seizures. Rodriguez presents the question of whether the Fourth Amendment tolerates EXTERIOR dog sniffs after completion of a traffic stop, not during, when the time needed to handle the matter for such violation exceeds a reasonable time.

The Pennsylvania trial courts have addressed this scenario many times, leading a Chester County Judge to state, “there is a distasteful convergence of facts and circumstances … that test the bounds of credulity and requires the court’s candor in distinguishing between lawful police investigatory conduct and conduct proscribed by our Constitutions.” Commonwealth v. Parker, 2009 Pa. Dist. & Cnty. Dec. LEXIS 132 (2009)(Honorable Ronald C. Nagle, Chester County Court of Common Pleas). The Pennsylvania Supreme Court has consistently stated, “Where the purpose of an initial traffic stop has ended and a reasonable person would not have believed that he was free to leave, the law characterizes a subsequent round of questioning by the police as an investigative detention or arrest. In the absence of either reasonable suspicion to support the investigative detention or probable cause to support the arrest, the citizen is considered unlawfully detained.”

After police finish processing a traffic infraction, the determination of whether a continuing interdiction constitutes a mere encounter or a constitutional seizure centers upon whether an individual would objectively believe that he was free to end the encounter and refuse a request to answer questions. Commonwealth v. Kemp, 2008 PA Super 274, 961 A.2d 1247, 1253 (Pa. Super. 2008) citing Commonwealth v. Strickler, 757 A.2d 884 (Pa. 2000).

To determine whether interaction following a legal detention is a “mere encounter” or a detention, Pennsylvania courts analyze the totality of the circumstances including:

1) the presence or absence of police excesses; 2) whether there was physical contact; 3) whether police directed the citizen’s movements; 4) police demeanor and manner of expression; 5) the location of the interdiction; 6) the content of the questions and statements; 7) the existence and character of the initial investigative detention, including its degree of coerciveness; 8) the degree to which the transition between the traffic stop/investigative detention and the subsequent encounter can be viewed as seamless, . . . thus suggesting to a citizen that his movements may remain subject to police restraint; 9) the presence of an express admonition to the effect that the citizen-subject is free to depart is a potent, objective factor; and 10) whether the citizen has been informed that he is not required to consent to the search.

Commonwealth v. Moyer. Conferral of the ‘free-to-go’ advice is itself not a reason to forego a totality assessment’ and therefore does not constitute a controlling factor in assessing whether a person would actually credit a police indication that he was free to leave.”

In many of these cases, the police fabricate the basis for the late night car stop, picking some specious motor vehicle code violation. Allegations of traveling too closely, lane change without a blinker, a license plate lights out, obstructions from a rear view mirror, or illegal under car lights are typical deminimus traffic violations. Sometimes tickets are issued. More often than not, no warnings or violation is recorded.

After the individual is removed from the vehicle, basic cursory flashlight investigation and driver’s information computer checks are made. In many cases all is legal.  There is no evidence of criminal activity presented to justify either a consensual search or a request for a non-consensual search. Maybe two cell phones, a rental car, and a careful driver from out-of-state is present. Troopers routinely claim under oath that the person, wherever they are coming from, was traveling from a high drug area.

At this juncture, state troopers threaten dogs ripping apart vehicles. If this does not work, suggestions of long delays and “we will just get a warrant” followed by “we will then rip your car apart” are employed. These tactics are deployed to secure consent to search. It is when the search requests are denied, as in Rodriguez, that state troopers call in backup canine officers. Here the motorist must wait and is thus detained.

When the dogs arrive and conduct the exterior sniff, alerting to “contraband”,Troopers now claim reasonable suspicion to then enter the car for further searching. Rodriguez addresses the legality of this police tactic; extending an otherwise legal traffic stop that did not present reasonable suspicion of criminal activity, by requiring a motorist to wait for the canine sniff team for the exterior search which creates the only reasonable suspicion to then enter the car without consent.

It is now the law of the land that this is illegal. Rodriquez rules that the traffic stops become unlawful when prolonged beyond the time reasonably required to complete the mission of issuing a warning ticket. The seizure remains lawful only so long is unrelated inquiries do not measurably extend the duration of the traffic stop. The court ruled that a dog sniff, a measure aimed at detecting evidence of ordinary criminal wrongdoing, with out reasonable suspicion to do so extends illegally the duration of the traffic stop.

The Court squarely rejected the argument that an officer may incrementally prolonged a stop to conduct dog sniffs so long as the officer is reasonably diligent in pursuing the traffic related purpose of the stop. (The Court equated this to the officer earning bonus time to pursue an unrelated criminal investigation.) The magistrate’s finding that the detention for the dog sniff, which itself prolongs the traffic stop, was not independently supported by individualize suspicion, rendered illegal the extension of the traffic stop.

Call me to discuss your car investigation.

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