Justia U.S. 7th Circuit Court of Appeals Opinion Summaries

Most commodities trading takes place with the participants using computers to execute hyper‐fast trading strategies at speeds, and in volumes, that far surpass those common in the past. Coscia commissioned and used a computer program to place small and large orders simultaneously on opposite sides of the commodities market in order to create illusory supply and demand, to induce artificial market movement. He was convicted under the anti‐spoofing provision of the Commodity Exchange Act, 7 U.S.C. 6c(a)(5)(C) and 13(a)(2), and of commodities fraud, 18 U.S.C. 1348(1) and was sentenced to 36 months’ imprisonment. The Act defines “spoofing” as “bidding or offering with the intent to cancel the bid or offer before execution.” The Seventh Circuit affirmed, finding the convictions supported by sufficient evidence. The anti‐spoofing provision provides clear notice and does not allow for arbitrary enforcement; it is not unconstitutionally vague. With respect to the commodities fraud violation, the court upheld a jury instruction on materiality: that the alleged wrongdoing had to be “capable of influencing the decision of the person to whom it is addressed.” The district court properly applied a 14‐point loss enhancement in calculating the sentence, given the nature and complexity of Coscia’s criminal enterprise. View "United States v. Coscia" on Justia Law

Based on a tip, DEA officers followed Harden and attempted a traffic stop. In attempting to evade officers, Harden attained speeds that were at least 21 miles per hour over the 25 mph speed limit. During the chase, he threw nearly two kilograms of cocaine out of the vehicle. The cocaine was subsequently recovered by law enforcement. Harden turned into a parking lot and made a U-turn, resulting in a collision with an agent’s vehicle. After the collision, the officers pulled Harden from the vehicle, which continued to move forward as his foot released the brake. Harden was uncooperative as he was arrested. Harden pled guilty, without an agreement, to possessing with intent to distribute five kilograms of cocaine, 21 U.S.C. 841(a)(1). The district court sentenced him to the statutory mandatory minimum of 10 years’ imprisonment and five years’ supervised release, rejecting Harden’s argument that the “safety valve” provision in 18 U.S.C. 3553(f) applied to him, which would allow the court to impose a sentence beneath the mandatory minimums. The Seventh Circuit affirmed, upholding a finding that Harden’s action constituted acts of violence or the threat of violence. That finding rendered Harden ineligible for the two-level safety valve reduction. View "United States v. Harden" on Justia Law

Anderson and three accomplices had robbed a Milwaukee bank in 2014. As they drove away, a dye pack burst inside a bag of currency, leaving some of the bills stained and singed. The robbers tossed the bag from the car. A citizen found it and gave it to police. Authorities found another $561 when, a day later, they arrested Anderson’s brother driving the stolen getaway car. Anderson pleaded guilty to armed bank robbery, 18 U.S.C. 2113(a), (d), and admitted stealing $4,237 in currency and about $500 in coins. The judge imposed 156 months’ imprisonment and ordered Anderson to pay $4,131 in restitution (a miscalculated amount). On remand, the case was assigned to a different judge; Anderson again changed lawyers. His third lawyer objected to the presentence report but said nothing about restitution. The judge sought clarification of the report’s restitution calculation. The prosecutor remained silent about the $2,107 of singed and stained currency in the government’s possession. The judge sentenced Anderson to 126 months’ imprisonment and again ordered him to pay $4,131 in restitution. The Seventh Circuit again remanded, noting that defense counsel may have been unaware of the cash recovered immediately after the robbery. Under 18 U.S.C. 3664(e), the government must prove that the victim will not be made whole by returning stolen property that has been recovered. View "United States v. Anderson" on Justia Law

With a warrant, police installed and monitored a GPS locator on Holst's car, while investigating Holst’s participation in methamphetamine sales. Police tracked Holst’s car as it stopped at a particular place for more than an hour. An informant told them that Holst had traveled to buy methamphetamine. Police stopped Holst’s car as he was driving home and found that drug. Other officers obtained a warrant to search the house in whose driveway Holst’s car had stopped. The search of Castetter’s house turned up methamphetamine, other drugs, and approximately $62,000 in cash. Prosecuted under 21 U.S.C. 841(a)(1), Castetter moved to suppress the evidence, arguing that information derived from the first warrant should be ignored because Holst lives in Michigan, where the first warrant issued, while Castetter lives in Indiana. The Seventh Circuit affirmed denial of the motion. The Fourth Amendment does not concern state borders. States may decide not to authorize their police to acquire information extraterritorially or may elect to ignore information from other states’ officers, but Indiana did not do so. Tracking a car by GPS does not offend any state’s sovereign rights. While the first warrant was not based on information about Castetter, all the police learned by monitoring the GPS was the location of Holst’s car. Castetter lacked a privacy interest in that location. The Constitution is not offended if, by executing a warrant to search one person (Holst), police learn incriminating details about another (Castetter). View "United States v. Castetter" on Justia Law

Stephenson was convicted, in Indiana, of the 1996 murders of three people and of theft of ammunition from the trailer in which one victim was staying. Shell casings at the murder scene matched those taken from the trailer. The jury recommended the death penalty, which the judge imposed. Stephenson’s state appeal and petition for postconviction relief were unsuccessful. A federal judge ruled that he had been denied effective assistance of counsel because his counsel had failed to object to Stephenson having to wear a stun belt in the courtroom. The Seventh Circuit remanded. The district judge then ruled that Stephenson had not been prejudiced by his lawyer’s failure to object to his having to wear a stun belt visible to jurors in the penalty phase because the jury had already decided that Stephenson was dangerous. The Seventh Circuit affirmed with respect to guilt. Taken together, the evidence old and new, “rife with inconsistencies,” fails to establish Stephenson’s innocence. Stephenson was not prejudiced at the guilt phase by the jury foreman’s acquaintance with the sister of a victim, or two jurors’ discussion of Stephenson’s participation in a bar fight before the murders. The Seventh Circuit reversed with respect to the guilt phase, noting that the Indiana Supreme Court has barred the future use of stun belts in courtrooms, which can compromise a defendant’s participation at trial because it relies on continuous fear. It is possible that Stephenson’s having to wear the stun belt—for no reason, given that he had no history of acting up in a courtroom—contaminated the penalty phase. View "Stephenson v. Neal" on Justia Law

The defendants were involved in a North Vernon, Indiana methamphetamine‐distribution conspiracy. Neeley supplied much of the methamphetamine that she and Maggard distributed to other dealers, including Bell and Jackson. Neeley sold Jackson a particularly potent batch of capsulated methamphetamine that killed Jackson’s wife, Jessie. For several hours after friends noticed that Jessie was sweating and convulsing in bed, Jackson did not assist her. He refused to take her to the hospital or call an ambulance, although she was unconscious. An acquaintance called one. Before the ambulance arrived, Jackson disposed of his drugs and paraphernalia by passing them to a neighbor out the back door of his home. The government was already investigating the conspiracy and had orders authorizing wire and electronic surveillance of Maggard’s phones. Through this surveillance, the government intercepted communications between Maggard, Bell, and Neeley, among many others. The defendants (and 15 others) were charged with 23 counts. The indictment contained allegations about sentencing enhancements, including: “that death resulted from the use of methamphetamine distributed by [Jackson and Neeley].” The Seventh Circuit affirmed the defendants’ convictions, rejecting challenges to the sufficiency of the evidence and upholding the admission of evidence related to Jessie’s death and the government’s wiretap evidence as compliant with 18 U.S.C. 2518(3)(c). View "United States v. Neeley" on Justia Law

Jackson was convicted of three counts of transporting a minor in interstate commerce with the intent that she engage an illegal sexual activity, 18 U.S.C. 2423(a), three counts of sex trafficking of a minor, 18 U.S.C. 1591(a), and one count of possessing a firearm in furtherance of a crime of violence (sex trafficking of a minor), 18 U.S.C. 924(c). The court sentenced Jackson to 295 months’ imprisonment. The Seventh Circuit vacated the section 924(c) conviction and remanded for resentencing. Under the categorical approach, Jackson’s underlying conviction for sex trafficking of a minor does not “have as an element” the use or attempted use of force; the elements clause conviction (section 924(c)(3)(B)) stands or falls under the residual or risk‐of‐force clause, which applies when the underlying crime “by its nature, involves a substantial risk that physical force against the person or property of another may be used in the course of committing the offense. That section is unconstitutionally vague. The court stated that on resentencing, the court should not apply a two-level increase in Jackson’s offense level for being a manager or supervisor in the offense under U.S.S.G. 3B1. View "United States v. Jackson" on Justia Law

In 2000, Gray and another went to Jones’s home to buy marijuana. Avant, was present and saw the three retire to the rear of the house. The third man returned and robbed Avant.Gray ran past carrying a bag, firing into the rear of the house. Jones died from gunshot wounds. Gray’s convictions were overturned on state post-conviction review. In 2007, Gray was again convicted of felony murder, murder, robbery, attempted murder, and carrying a handgun without a license. During the retrial, the prosecution used four peremptory challenges on black jurors. The prosecution’s case hinged on testimony from Avant and White; both maintained that Gray confessed while they shared a cell. Avant initially asserted that he was not present for the robbery. He struggled to identify the assailants. White was trying to get a lighter sentence. Defense counsel introduced Gray’s similar crime against White to undermine White’s credibility. The jury initially deadlocked. Gray’s state petition for post-conviction relief stopped the one-year limitations period under the Antiterrorism and Effective Death Penalty Act, 28 U.S.C. 2244(d)(1). Gray had until January 11, 2013, to file his federal habeas corpus petition. He filed on April 29, 2013, The district court dismissed. The Seventh Circuit affirmed, finding Gray ineligible for equitable tolling, and did not address ineffective assistance of counsel, whether striking the black jurors violated Batson, and the possibility that Gray’s due process rights were violated by inaccurate juror questionnaire answers. View "Gray v. Zatecky" on Justia Law

Coexist was formed by Hubman, an admitted con man, after a court found that his previous enterprise, Hubman Foundation was not a charity but a sham designed to insulate Hubman from his debts and obligations. Hubman was introduced to Fehrenbacher, the president of a wholesale banking institution that packaged and sold mortgage notes to investment banks, and of a retail loan broker. In 2009, Fehrenbacher offered Hubman a deal via email that promised returns of 25-30% per week and that any invested funds would not be at risk and would be held in escrow. Coexist ultimately wired $2 million from Coexist, plus $2.8 million of Hubman's money to Assured Capital, following Fehrenbacher’s instructions. It was a Ponzi scheme. Hubman complained to the FBI and filed a civil suit. Assured ultimately paid him $4.3 million. Fehrenbacher then returned $1,494,250 to Coexist. The $2 million that Coexist “invested” was actually the money of Stewart, a retired professional baseball player. The Stewarts obtained a judgment for $2 million against Hubman and Coexist. Hubman did not pay. Coexist filed suit against Fehrenbacher and his companies. The Seventh Circuit affirmed a finding that the defendants violated a Florida law prohibiting the sale of unregistered securities and an order of rescission. View "Coexist Foundation, Inc. v. Fehrenbacher" on Justia Law

In 1992, Prevatte was convicted of detonating a pipe bomb that destroyed property and resulted in the death of a bystander, Antkowicz, 18 U.S.C. 844(i). If the bomb had not caused a death, the maximum sentence Prevatte could have received would have been 10 years. The judge found that the bomb did cause the death; Prevatte was sentenced to 44 years’ imprisonment. Prevatte filed a habeas corpus petition, 28 U.S.C. 2241, claiming that under the Supreme Court’s 2014 “Burrage” decision, the jury, not the judge, should have made the finding that the bomb was the but-for cause of Antkowicz’s death so that his enhanced sentence was illegal and a miscarriage of justice. The district court dismissed Prevatte’s petition. The Seventh Circuit affirmed. Burrage is not about whether a judge or jury makes the “death results” finding, but clarifies that the underlying crime, the detonation of the bomb, must be a but-for cause of death and not merely a contributing factor. Prevatte could have argued that the government did not prove that the bomb was a but-for cause of death at trial, on direct appeal or in his initial section 2255 motion. The unrebutted evidence established that the bomb was the but-for cause of Ms. Antkowicz’s death. Prevatte’s enhanced sentence is neither illegal nor a miscarriage of justice. View "Prevatte v. Merlak" on Justia Law