United States v. Carpenter, 1st Cir. (2013)
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Transcript of United States v. Carpenter, 1st Cir. (2013)
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United States Court of AppealsFor the First Circuit
No. 11- 2131
UNI TED STATES,
Appel l ant ,
v.
DANI EL E. CARPENTER,
Def endant , Appel l ee.
APPEAL FROM THE UNI TED STATES DI STRI CT COURTFOR THE DI STRI CT OF MASSACHUSETTS
[ Hon. Geor ge A. O' Tool e, J r . , U. S. Di st r i ct J udge]
Bef or e
Lynch, Chi ef J udge,St ahl and Howar d, Ci r cui t J udges.
Kel l y Begg Lawr ence, Assi st ant U. S. At t orney, wi t h whomCarmenOr t i z, Uni t ed St at es At t or ney, was on br i ef , f or appel l ant .
Mart i n G. Wei nber g, wi t h whom Rober t M. Gol dst ei n was onbr i ef , f or appel l ee.
November 25, 2013
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LYNCH, Chief Judge. The quest i on i n t hi s case i s whet her
comment s i n t he gover nment ' s cl osi ng ar gument at a second cr i mi nal
t r i al wer e i mpr oper and whet her t hey accordi ngl y warr ant ed a new
t r i al , as t he di st r i ct cour t hel d. See Uni t ed St at es v. Car pent er ,
808 F. Supp. 2d 366, 380- 85 ( D. Mass. 2011) .
Def endant Dani el Carpent er has now been t r i ed t wi ce on
char ges of wi r e f r aud and mai l f r aud. Bot h t i mes, t he j ur y
r et ur ned a convi ct i on. Af t er t he f i r st t r i al i n 2005, t he di str i ct
cour t upset t he convi ct i on and order ed a new t r i al on t he gr ounds
t hat t he government ' s cl osi ng ar gument was i mproper and may have
t ai nt ed t he j ur y' s ver di ct . See Uni t ed St at es v. Car pent er , 405 F.
Supp. 2d 85, 101- 03 ( D. Mass. 2005) . We uphel d t hat deci si on by a
di vi ded panel . See Uni t ed St at es v. Carpent er , 494 F. 3d 13, 29
( 1st Ci r . 2007) .
The case was r et r i ed i n 2008 and t he gover nment made a
di f f er ent cl osi ng ar gument . The j ur y agai n convi ct ed. The
di st r i ct cour t agai n gr ant ed a new t r i al , f i ndi ng t hat t he
di f f er ent cl osi ng ar gument l ed t he j ur y t o convi ct on an i mpr oper
basi s. See Carpent er , 808 F. Supp. 2d at 385- 86. Because t he
gover nment ' s comment s i n i t s cl osi ng ar gument at t he second t r i al
wer e not i mpr oper , we r ever se, r ei nst at e t he j ur y' s ver di ct of
convi ct i on, and r emand f or sent enci ng.
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I .
A. Backgr ound
Dur i ng t he l ate 1990s, Carpent er r an a busi ness,
Beni st ar , 1 whi ch speci al i zed i n conduct i ng " 1031 exchanges" f or
i nvest ment pr opert y owners. Sect i on 1031 exchanges t ake t hei r name
f r om a pr ovi si on of t he f eder al t ax code, 26 U. S. C. 1031, whi ch
al l ows an owner of i nvest ment pr oper t y t o def er payi ng capi t al
gai ns t axes upon t he sal e of t he pr oper t y i f t he pr oper t y i s
"exchanged" f or pr oper t y "of l i ke ki nd. " The f unds f r om t he
i ni t i al sal e may be hel d t empor ar i l y i n cash f or m wi t h no t ax
penal t y as l ong as t hey ar e used t o pur chase new pr oper t y wi t hi n
180 days and as l ong as t he i nvest or desi gnat es t he repl acement
pr oper t y wi t hi n 45 days. See 26 U. S. C. 1031( a) ( 3) . Under
f eder al r egul at i ons, t he exchangor may not t ake possessi on of t he
f unds bef ore pur chasi ng t he new pr oper t y. See 26 C. F. R.
1. 1031( k) - 1( a) . As a r esul t , exchangor s t ypi cal l y r el y on
"qual i f i ed i nt er medi ar i es" t o hol d and i nvest t he f unds unt i l t he
exchange i s compl et ed.
B. Beni st ar ' s Mar ket i ng Mat er i al s
Beni st ar of f er ed i t s ser vi ces as a qual i f i ed
i nt er medi ar y, managi ng t he pr oceeds f r om an exchangor ' s i ni t i al
1 Ther e wer e t wo r el at ed cor por at e ent i t i es - - col l ect i vel y,"Beni st ar " - - i nvol ved i n Car pent er ' s busi ness: Beni st ar , Lt d. , t hepr i mary cor porat i on, and Beni st ar Propert y Exchange Trust Company,I nc. , a l at er - f or med subsi di ar y. The di st i nct i on bet ween t hecor por at e i dent i t i es i s not r el evant .
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sal e unt i l t he 1031 exchange was compl et ed. I n adver t i si ng
i t sel f t o pot ent i al exchangor s, Beni st ar pr ovi ded a set of
mar ket i ng mat er i al s, i ncl udi ng a Power Poi nt sl i de show, a set of
"Fr equent l y Asked Quest i ons about 1031 Proper t y Exchange, " an
ar t i cl e on 1031 exchanges aut hored by Beni st ar ' s pr i nci pal
market er and publ i shed i n the New Engl and Real Est ate J our nal , and
other i nf ormat i on. When exchangors deci ded t o work wi t h Beni st ar ,
t hey woul d al so recei ve a set of f or ms set t i ng out t he t er ms of t he
account s t hey woul d hol d wi t h Beni st ar .
Car pent er di d not di r ect l y sol i ci t exchangor s, nor di d he
cr eat e t he mar ket i ng mat er i al s. However , he di d r evi ew al l of t he
market i ng mater i al s and appr oved thei r use. 2 He al so execut ed f or
Beni st ar many of t he cont r act s t he exchangors ent er ed wi t h t he
company.
On t he gover nment ' s t heory of pr osecut i on, t he market i ng
mat er i al s ef f ect i vel y pr omi sed at mul t i pl e poi nt s t hat exchangor s'
f unds woul d be kept saf e and secur e. One of t he Power Poi nt sl i des,
f or exampl e, was ent i t l ed "Choosi ng an I nt er medi ar y" and l i st ed
sever al f act or s that cl i ent s shoul d consi der . The f our t h f act or
2 Beni st ar af f i l i ates ot her t han Carpent er may have made oral
r epr esent at i ons t o pr ospect i ve exchangor s, whi ch Car pent er ar guedwere unaut hor i zed and t heref ore unat t r i but abl e t o hi m. We need noteval uat e t hat evi dence, however , because the j ur y' s gui l t y ver di ctf or al l ni net een charges, some of whi ch r el ated t o exchangors whor ecei ved no or al r epr esent at i ons, i ndi cat es t hat i t f ound t hewr i t t en mat er i al s al one t o be suf f i ci ent . We consi der onl y t hewr i t t en mar ket i ng mat er i al s.
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was l abel ed "Secur i t y of Funds" and st ated t hat exchangors shoul d
" [ a] sk about t he secur i t y of your f unds, and f i nd out what
guar ant ees ar e of f er ed. " The next sl i de went on t o st at e: "Mer r i l l
Lynch Pr i vat e Bank i s used f or al l our escr ow account s. Thi s
pr ovi des a 3% - 6% i nt er est on t he escr ow. "
Li kewi se, t he "Fr equent l y Asked Quest i ons" document
i ncl uded a quest i on aski ng "What wi l l t he i nt er medi ary do wi t h my
money?" The answer pr ovi ded:
[ Beni st ar ] has a l ong- st andi ng r eput at i on f ort r ust wor t hi ness, and i s . . . t he l ar gest 419t r ust pl an admi ni st r at or i n t he nat i on.
Beni st ar has account s wi t h maj or banki ng andi nvest ment f i r ms, such as Mer r i l l Lynch. . . .Escr ow account s ar e rest r i ct ed t o payi ng outf unds onl y f or a subsequent cl osi ng, or t or et ur n f unds t o t he or i gi nal pr oper t y owner .
A si mi l ar set of " I RC 1031 Proper t y Exchanges: Fr equent l y Asked
Quest i ons" on Beni st ar ' s websi t e l i st ed t he quest i on, "Can I Tr ust
[ Beni st ar ] wi t h My Money?" The answer expl ai ned:
[ W] e pr ot ect your asset s: We have account s wi t h maj or banki ng andi nvest ment f i r ms - - account s under our sol econt r ol , as r equi r ed f or t heseexchanges. . . . Our account s are r est r i ct ed t o payi ng outf unds onl y f or a subsequent cl osi ng, or t or et ur n f unds t o t he or i gi nal pr oper t y owner . We di st r i but e f unds onl y at your wr i t t en
r equest .Sever al other component s of t he pr omot i onal mater i al s bor e out
si mi l ar t hemes.
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Exchangors usi ng Beni st ar as an i nt er medi ary wer e gi ven
t he choi ce t o have t hei r money i nvest ed dur i ng the pendency of
t hei r exchanges f or ei t her a 3% or 6% annual i zed r et ur n. Af t er
sendi ng i n t hei r f unds f r om t he i ni t i al sal e, exchangor s r ecei ved
a conf i r mat i on l et t er st at i ng: "We have r ecei ved $____ of sal es
pr oceeds, whi ch we ar e hol di ng f or your benef i t . These f unds ar e
accrui ng i nt er est at %___. " The second bl ank woul d be f i l l ed i n
wi t h ei t her 3% or 6%. The 3% choi ce, whi ch was sel ect ed f or t he
maj or i t y of t he f unds i n t he case, was cal l ed a "Mer r i l l Lynch
Ready Asset Money Market Account " i n sever al of t he document s,
i ncl udi ng t he account sel ect i on f ormand t he Escr ow Agr eement t hat
t he exchangors si gned.
The gover nment al l eges t hat t hese mat er i al s, t aken
t oget her , l ed exchangor s t o bel i eve t hat t hei r f unds woul d be
i nvest ed i n "saf e, " i nt er est - bear i ng "escr ow" account s guar ant eei ng
a 3% or 6% r et ur n, when i n f act t hei r f unds wer e not kept i n saf e
i nvest ment s.
C. Car pent er ' s Tr adi ng St r at egy and Losses
I n r eal i t y, Car pent er used t he exchangor s' f unds t o t r ade
i n r i sky asset s, i ncl udi ng st ock opt i ons. Car pent er pr i mar i l y sol d
"put " opt i ons, whi ch al l ow t he opt i onhol der t o sel l shar es of st ock
t o t he opt i on sel l er i n t he f ut ur e at an agr eed- upon pr i ce wi t hi n
an agr eed- upon t i mef r ame. Gener al l y, t he hol der of a put opt i on
wi l l make money when t he pr i ce of t he under l yi ng st ock decreases
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dur i ng t he opt i on per i od, whi l e t he sel l er of t he opt i on wi l l make
money when t he pr i ce of t he under l yi ng st ock i ncr eases dur i ng t he
opt i on per i od. Many of Carpent er ' s t r ades were "naked" or
"uncover ed, " meani ng t hat Carpent er di d not own t he under l yi ng
shar es or t ake an of f set t i ng posi t i on. Naked or uncover ed opt i on
t r adi ng i ncreases a t r ader ' s r i sk of l oss.
Car pent er ' s t r adi ng st r at egy succeeded at f i r st , f r om
1998 t o 2000, and the addi t i onal gai ns beyond the pr omi sed 3%or 6%
annual i zed r et ur n i ncr eased t he company' s, and hi s own, pr of i t .
Dur i ng t hat t i me, Beni st ar ' s cl i ent s wer e pai d t he amount s pr omi sed
t o t hem. But Car pent er ' s i nvest ment s began t o t ur n i n t he spr i ng
of 2000. From l at e Mar ch t o l at e May 2000, Car pent er l ost
appr oxi mat el y one mi l l i on dol l ar s f r om Beni st ar ' s Mer r i l l Lynch
t r adi ng account as var i ous st ocks f el l si gni f i cant l y dur i ng t he
opt i on per i ods. Car pent er ' s st r at egy ul t i mat el y f ai l ed compl et el y
when t he NASDAQ st ock mar ket cr ashed i n l at e 2000. By the end of
Sept ember 2000, Car pent er had l ost about f our mi l l i on dol l ar s.
The per i od cover ed by t he i ndi ct ment st ar t ed t o r un af t er
Car pent er had al r eady suf f er ed si gni f i cant l osses. Even as
Car pent er ' s l osses mount ed, Beni st ar cont i nued sol i ci t i ng busi ness
usi ng t he same mar ket i ng mat er i al s wi t h t he same l anguage about
saf et y, escr ow account s, and pr omi sed r at es of r et ur n, even though
Carpent er cont i nued t o empl oy t he same t r adi ng st r ategy. By t he
begi nni ng of 2001, Car pent er had l ost appr oxi mat el y ni ne mi l l i on
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dol l ars bel ongi ng t o seven exchangors who had cont r acted wi t h
Beni st ar between August and December 2000. Those exchangor s wer e
never pai d t he pr omi sed 3% or 6% i nt er est and l ost t he vast
maj or i t y of t hei r pr i nci pal .
D. Pr ocedur al Hi st or y
1. Fi r st Tr i al
On Febr uary 4, 2004, Carpent er was i ndi ct ed wi t h ni net een
count s of wi r e f r aud and mai l f r aud i n vi ol at i on of 18 U. S. C.
1343 and 1341, r espect i vel y. The government al l eged t hat
Carpent er had f r audul ent l y i nduced t he exchangors t o use hi s
company t o per f or m t hei r exchanges i n par t t hr ough f al se pr omi ses
t hat t hei r money woul d be kept i n saf e, i nt er est - bear i ng account s.
Each of t he count s char ged i n t he i ndi ct ment r el at es onl y
t o t hose exchangors who engaged Beni st ar ' s ser vi ces i n t he per i od
af t er Car pent er began i ncur r i ng l osses i n spr i ng of 2000. The
ear l i est deposi t charged i n t he i ndi ct ment occur r ed i n August 2000,
and t he maj or i t y occur r ed i n November or December 2000. The
charges wer e based i n part on t he t heory t hat Carpent er i nt ended t o
decei ve t he exchangors as shown by hi s cont i nui ng t o make the same
r epr esent at i ons t o t hem about t he handl i ng of t hei r money even
af t er he knew of hi s i nvest ment st r at egy' s f ai l ur es.
Carpent er ' s def ense cent er ed on t he ar gument s t hat t he
market i ng mater i al s never pr omi sed t hat t he f unds woul d be kept i n
"saf e" account s, t hat t hese wer e sophi st i cat ed i nvest or s, and t hat
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whi l e Carpenter di d want t o make money, t her e was not hi ng wr ong
wi t h hi s mot i ves and he never had t he r equi si t e i nt ent t o def r aud
at t he t i me any r epr esent at i ons wer e made. Carpent er noted i n
par t i cul ar t hat t he cont r act s t he exchangor s si gned cl ear l y and
expl i ci t l y gr ant ed Beni st ar unl i mi t ed di screti on t o i nvest t hei r
f unds.
The case went t o i t s f i r st t r i al i n J ul y 2005. Af t er a
t hi r t een- day t r i al , a j ur y f ound Car pent er gui l t y on al l ni net een
count s af t er about si x hour s of del i ber at i on. The next week, on
August 5, 2005, Car pent er f i l ed mot i ons f or acqui t t al and f or a new
t r i al . On December 15, 2005, t he di st r i ct cour t deni ed t he mot i on
f or acqui t t al but gr ant ed t he mot i on f or a new t r i al on t he gr ounds
t hat t he gover nment ' s cl osi ng argument had i mproper l y made use of
an ext ended met aphor port r ayi ng Carpent er ' s act i ons as gambl i ng.
The cour t expl ai ned t hat evi dence of t he l osses Car pent er had
act ual l y sust ai ned had been admi t t ed f or t he l i mi t ed pur pose of
pr ovi ng i nt ent , but t he gover nment had repeat edl y conj ur ed i t
i mpr oper l y i n i t s cl osi ng ar gument ' s ref er ences t o gambl i ng. The
di st r i ct cour t f ound t hat i n l i ght of t he over al l st r engt h of t he
case, whi ch was not over whel mi ng and woul d have al l owed a rat i onal
j ury t o acqui t , i t was possi bl e t hat t he gover nment ' s i mproper
cl osi ng ar gument s had t ai nt ed t he j ur y' s ver di ct . However , t he
cour t al so not ed t hat t he evi dence was st i l l suf f i ci ent t o sust ai n
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a convi ct i on and order ed a new t r i al . See Carpent er , 405 F. Supp.
2d at 102- 03.
The gover nment appeal ed t he new t r i al or der f r om t hat
f i r st t r i al , and Car pent er cross- appeal ed t he deni al of hi s mot i on
f or acqui t t al . I n J ul y 2007, a di vi ded panel of t hi s cour t uphel d
t he di st r i ct cour t ' s or der s, expl ai ni ng t hat t he di st r i ct cour t had
not abused i t s di scr et i on i n det er mi ni ng t hat t he gover nment ' s
comment s coul d have tai nt ed t he ver di ct and t hat t he appel l ate
cour t l acked j ur i sdi ct i on t o r evi ew t he deni al of t he mot i on f or
acqui t t al wher e the under l yi ng convi ct i on had been vacat ed.
Car pent er , 494 F. 3d at 24- 26. Car pent er pet i t i oned f or cer t i or ar i
as t o t he concl usi on t hat t he cour t l acked j ur i sdi ct i on t o r evi ew
t he deni al of t he mot i on f or acqui t t al ; t he pet i t i on was deni ed.
See Carpent er v. Uni t ed St ates, 552 U. S. 1230 ( 2008) .
2. Second Tr i al
The second t r i al began i n J une 2008. Af t er another
t hi r t een- day t r i al at whi ch he decl i ned t o t est i f y i n hi s def ense,
Car pent er was agai n f ound gui l t y by a j ur y on al l ni net een count s.
Agai n, Car pent er chal l enged t he r esul t , f i l i ng a mot i on f or
acqui t t al or , i n t he al t er nat i ve, f or a new t r i al on J ul y 3, 2008.
I n hi s new t r i al mot i on, Car pent er ar gued t hat t he t r i al was f l awed
on sever al gr ounds; most si gni f i cant l y, he ar gued t hat t he
gover nment had knowi ngl y used per j ured t est i mony and i mproper l y
pr esent ed evi dence of Car pent er ' s act ual l osses, and t hat i t s
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cl osi ng ar gument was f l awed i n a var i et y of ways, i ncl udi ng ( 1) i t s
f ocus on Car pent er ' s l osses and t he r i ski ness of hi s i nvest ment s,
( 2) i t s char acter i zat i on of cer t ai n evi dence agai nst hi m as
def i ni t i vel y pr oven r at her t han l ef t t o i nf er ence, and ( 3) i t s use
of t he pr osecut or ' s per sonal opi ni on.
Af t er a l engt hy del ay, on Sept ember 1, 2011, t he di st r i ct
cour t deni ed t he mot i on f or acqui t t al , agai n obser vi ng t hat t he
gover nment ' s proof had been st r ong enough t o sust ai n a convi ct i on.
Car pent er , 808 F. Supp. 2d at 386. But i t al so gr ant ed t he mot i on
f or a new t r i al . I n gr ant i ng t he new t r i al , t he di st r i ct cour t
r ej ect ed t he gr ounds Car pent er asser t ed i n hi s mot i on. See i d. at
380 n. 6. Nonet hel ess, t he di st r i ct cour t expl ai ned t hat t he
gover nment had er r ed i n t hr ee ways whi l e del i ver i ng i t s cl osi ng
ar gument : ( 1) i t i mpr oper l y st at ed t hat Car pent er had pr omi sed t o
keep t he exchangor s' money i n saf e account s ( r at her t han expl i ci t l y
ar gui ng t hat t hi s pr omi se coul d be i nf er r ed f r om t he mar ket i ng
document s) ; ( 2) i t i mpr oper l y di scussed "par ki ng" t he exchangor s'
money i n "escr ow" account s as a gener al mat t er r ather t han deal i ng
wi t h t he speci f i c t r ansact i ons i n t he case; and ( 3) i t i mpr oper l y
r ef er r ed r epeat edl y t o what t he di st r i ct cour t cal l ed Car pent er ' s
"gr eed, " t hat i s, hi s pr of i t - seeki ng acti ons. See i d. at 380- 85.
The di st r i ct cour t f ur t her not ed t hat t he j ury had spent a
r el at i vel y shor t t i me - - appr oxi mat el y t wo hour s - - i n
del i ber at i ons, whi ch i t t ook as evi dence t hat t he j ur y may have
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been l ed t o convi ct on an i mpr oper basi s. I d. at 385. Concl udi ng
t hat t he government had "poi soned t he wel l " t hr ough i t s comment s,
t he di st r i ct cour t gr ant ed a new t r i al . I d. at 386.
The par t i es agai n cr oss- appeal ed. 3 The government ' s
appeal r emai ns bef ore us. The gover nment argues t hat i t s cl osi ng
ar gument was not i mpr oper , and t hat even i f i t wer e, t he di st r i ct
cour t was r equi r ed t o appl y pl ai n er r or r evi ew, gi ven t he cour t ' s
r el i ance on f act ors t he gover nment sai d had not been t he subj ect of
Car pent er ' s obj ect i ons; t hat t he di st r i ct cour t er r oneousl y
consi der ed t he br evi t y of t he j ur y del i ber at i ons i n or der i ng t he
new t r i al ; and t hat , i n any event , t he di st r i ct cour t abused i t s
di scret i on i n gr ant i ng t he new t r i al .
I I .
The ul t i mat e grant of a new t r i al i s r evi ewed f or abuse
of di scr et i on; however , we deci de de novo whet her t he under l yi ng
comment s i n t he cl osi ng argument were i mproper . See Uni t ed St at es
v. Her nndez, 218 F. 3d 58, 68 ( 1st Ci r . 2000) . The de novo r evi ew
st andar d i s t he st andar d we appl y her e. A di st r i ct cour t
necessar i l y abuses i t s di scr et i on when i t commi t s a mat er i al er r or
of l aw or r el i es upon an i mpr oper f act or . Uni t ed St at es ex r el .
J ones v. Br i gham& Women' s Hosp. , 678 F. 3d 72, 83 ( 1st Ci r . 2012) .
3 Thi s cour t , i n an or der dat ed May 3, 2013, di smi ssedCar pent er ' s cr oss- appeal f or l ack of j ur i sdi ct i on based on l aw oft he case doct r i ne and our opi ni on i n t he 2007 appeal . Carpent erhas pet i t i oned f or cer t i or ar i as t o t hat or der .
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A concl usi on t hat t her e was mi sconduct i s an i ssue of l aw. See
Uni t ed St at es v. Car t agena- Car r asqui l l o, 70 F. 3d 706, 713 ( 1st Ci r .
1995) ( descr i bi ng anal ysi s t o use i n t he event t hat pr osecut or ' s
comments ar e i mproper ) .
A. Gover nment ' s Cl osi ng Ar gument
The di st r i ct cour t hel d t hat t he gover nment ' s cl osi ng
ar gument was i mpr oper i n t hr ee r espect s: ( 1) i t over st at ed t he
degr ee t o whi ch Car pent er pr omi sed "saf et y and secur i t y" i n
i nvest ment s; ( 2) i t over l y gener al i zed t he nat ur e of "par ki ng" t he
exchangors' money i n "escr ow" account s; and ( 3) i t r epeatedl y
r ef er r ed t o Car pent er ' s pr of i t mot i ve. Car pent er , 808 F. Supp. 2d
at 380- 85. Car pent er had not expl i ci t l y r ai sed any of t hese t hr ee
i ssues as possi bl e er r or s i n hi s br i ef i ng or ar gument s i n t he
di s t r i ct cour t . 4 Rat her , t he cour t ' s f ocus on t hese t hr ee i ssues
was sua spont e, af t er t he br i ef i ng and ar gument wer e compl et ed.
Carpent er di d make ot her argument s, whi ch we f i nd, as di d t he
di st r i ct cour t , wer e i nsuf f i ci ent t o war r ant a new t r i al .
I n cont ext , none of t hese t hr ee f eat ur es of t he
gover nment ' s cl osi ng was i mpr oper . We t ur n t o t he di st r i ct cour t ' s
r easons and expl ai n our concl usi ons t o t he cont r ary.
4 The gover nment makes an al t ernat i ve ar gument t hat t hedi st r i ct cour t shoul d have appl i ed pl ai n er r or r evi ew becauseCar pent er f ai l ed t o i dent i f y t hese possi bl e er r or s i n t he di st r i ctcour t . See Uni t ed St ates v. Ol ano, 507 U. S. 725, 736 ( 1993) . Weneed not r each t hi s i ssue i n l i ght of our hol di ng her e.
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1. "Saf et y" and "Secur i t y"
The di st r i ct cour t ci t es t hree r ef er ences i n t he
pr osecut i on' s cl osi ng t o "saf et y" or "secur i t y" of t he exchangor s'
f unds as i mpr oper . I n f act , al l t hr ee ar e per mi ssi bl e ar gument s.
The f i r st st at ement t hat t he di st r i ct cour t l i st s as
wr ongf ul i s t he gover nment ' s asser t i on t hat , i n f ul l , Car pent er
" t ook i n mi l l i ons of dol l ar s i n r eal est at e exchangor s' money based
on f al se and f r audul ent pr et enses t hat Beni st ar woul d pr ot ect t he
secur i t y and saf ety of t he exchangors' money and that t he money
woul d be hel d f or t he exchangors' benef i t t o buy r epl acement
pr oper t y. " The argument , wi t hi n a f ew sent ences, went on t o say
t hat Carpent er knew not a si ngl e document advi sed exchangors t hat
he was t aki ng t he r i sks he di d wi t h t hei r money and knew t hat i f
t he exchangor s had been so advi sed, t hey never woul d have
cont r act ed wi t h Beni st ar .
The gover nment acknowl edged t hat t here was no di sput e as
t o what t he document s pr ovi ded or t he l osses suf f er ed, t hen sai d:
" [ W] hat i s i n di sput e her e i s how t hi s evi dence f i t s i nt o what you
must deci de . . . whi ch i s whet her Mr . Carpent er commi t t ed mai l and
wi r e f r aud by hi s conduct . " The gover nment argued t hat t he
exchangor s, al l i n t he r eal est at e busi ness, needed t o i dent i f y an
exchange pr opert y wi t hi n 45 days and under no ci r cumst ances coul d
t ake l onger t han 180 days t o compl et e t hei r exchanges, and t hat
Beni st ar knew i t s use of t he exchangors' money was so l i mi t ed. As
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t he pr osecut i on phr ased i t , "[ r ] i ski ng al l of t he f unds t o be hel d
shor t t er mf or r eal est at e pur poses i s si mpl y i nconsi st ent wi t h t he
busi ness Car pent er r epr esent ed [ Beni st ar ] t o be. " The pr osecut i on
t hen t ur ned t o what t he market i ng document s sai d, such as "[ a] sk
about t he secur i t y of your f unds and f i nd out what guar ant i es are
of f er ed, " and "[ Beni st ar ] has a l ongst andi ng r eput at i on f or
t r ust wor t hi ness. " The ar gument t hen cont i nued wi t h r ef er ences t o
expr ess l anguage i n t he ot her document s gi ven t o exchangors.
Thi s f i r st st at ement i s t he ver y f i r st sentence of t he
pr osecut i on' s cl osi ng and si mpl y st at es t he gover nment ' s t heor y of
t he case. Whi l e t he gover nment may not make unf ai r st at ement s i n
i t s cl osi ng, see Car pent er , 494 F. 3d at 23, i t i s not bar r ed f r om
st at i ng i t s t heor y of t he case. Cf . Fowl er v. War den, N. H. St at e
Pr i son, No. 93- 1668, 1994 WL 44833, at *2 ( 1st Ci r . Feb. 15, 1994)
( per cur i am) ( f i ndi ng seemi ngl y i mpr oper st atement not i mpr oper
when t aken i n cont ext as f i r st sent ence of cl osi ng argument
r espondi ng t o def ense' s t heor y of t he case) . Whi l e t he gover nment
di d not say expl i ci t l y t hat i t was aski ng t he j ur y t o dr aw an
i nf er ence f r om t he document s and f act s, t hat was t he st r uct ur e of
t he argument as a whol e. The st at ement was not i mper mi ss i bl e.
The second st at ement t hat t he di st r i ct cour t f aul t s i s
t he gover nment ' s asser t i on t hat " t he market i ng document s . . .
emphasi zed t he saf ety and secur i t y of t he money. " Thi s st at ement
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was not i mpermi ss i bl e. 5 Li ke t he f i r st st at ement , i t al so ser ved
as an i nt r oduct i on and was f ol l owed by di r ect quot at i ons f r om
admi t t ed document s t hat coul d easi l y be read as emphasi zi ng
pr eci sel y t hat saf et y and secur i t y. Cf . Uni t ed St at es v. Robi nson,
473 F. 3d 387, 397 ( 1st Ci r . 2007) . For exampl e, t he government
went on t o r ef er ence mar ket i ng mater i al s t hat t ol d pot ent i al
exchangor s compar i ng pot ent i al i nt er medi ar i es t o "ask about t he
secur i t y of your f unds" and t o consi der Beni st ar ' s " l ongst andi ng
r eput at i on f or t r ust wor t hi ness" and t he r el i ance on t he st at ed r ol e
of Beni st ar as a f i duci ar y.
The f i nal st at ement t hat t he di st r i ct cour t f ound
i mpr oper on t hi s subj ect was t he gover nment ' s assert i on t hat " t he
r epr esent at i ons t hat t he money i s goi ng t o be hel d f or t he
exchangor s' benef i t and t hat i t wi l l be hel d saf e and secur e [ ar e]
f al se because [ Car pent er ] can' t meet t he obl i gat i ons t hat he owes
t o ot her exchangor s. " The di st r i ct cour t ' s obj ect i on was t hat t hi s
st at ement asser t s as a f act what i s avai l abl e onl y i nf er ent i al l y,
t hat Carpent er pr omi sed t hat t he money woul d be kept saf e. Thi s
st at ement bui l ds of f of t he pr osecut i on' s ear l i er ar gument about
t he repr esent at i ons t hat wer e made and uses t he concl usi on f r om
t hat ar gument as t he st ar t i ng poi nt f or a new one. Cf . Uni t ed
St at es v. Mar t nez- Medi na, 279 F. 3d 105, 119 ( 1st Ci r . 2002)
5 I n hi s own cl osi ng, Car pent er st r essed t he l anguage of t hesame document s and di sput ed whet her t hey coul d be r ead as pr omi si ngsecur i t y at al l .
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( f i ndi ng st atement s i n cl osi ng argument not i mpr oper when t hey
"appear r easonabl y suppor t ed by t he recor d or ar e wi t hi n t he
pr er ogat i ve of t he pr osecut i on t o char act er i ze t he evi dence
pr esent ed at t r i al and ar gue cer t ai n i nf er ences t o t he j ur y. ") . I n
t he cont ext of t he cl osi ng ar gument as a whol e, we see nothi ng
i mpr oper about t hi s asser t i on. 6
2. St at ement s About "Par ki ng" Money i n "Escr ows"
The di st r i ct cour t al so f ound f aul t wi t h t he gover nment ' s
char act er i zat i on of Beni st ar ' s r epr esent at i ons of i t s busi ness as
i nvol vi ng "par ki ng" money i n "escr ows. " Thi s i ssue was not even
adver t ed t o i n t he def endant ' s obj ect i ons. The cour t t hought t hi s
char act er i zat i on cont r avened i t s j ur y i nst r uct i on t hat nei t her t he
cont r act s nor gover ni ng l aws l i mi t ed how a qual i f i ed i nt er medi ar y
coul d handl e an exchangor ' s f unds and i mpr oper l y l ed t he j ur y t o
bel i eve t hat Carpenter had breached some agr eement . Wi t hout
r est r i cti ons ei t her i n st at ut es or i n t he cont r act, t he cour t
concl uded, t he gover nment ' s argument was i mproper because " no such
r epr esent at i on [ of havi ng a l i mi t t o Beni st ar ' s abi l i t y t o ' i nvest '
f unds] coul d be i mpl i ed. " We di sagr ee and do not cr edi t t hat
concl usi on of i mpr opr i et y.
6 Car pent er ar gues t hat we shoul d not l i mi t our anal ysi s t ot he t hr ee par t i cul ar st at ement s l i st ed by t he di st r i ct cour tbecause, he ar gues, t hose i nst ances were merel y exampl es of agener al t heme of wr ongdoi ng. We have consi der ed t he ent i r e cl osi ngargument i n cont ext and di sagree.
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The gover nment di d not seek t o have t he j ury convi ct on
t he basi s t hat Car pent er was i n br each of cont r act or t r ansgr essi ng
a l aw r egul at i ng qual i f i ed i nt er medi ar i es qua i nt er medi ar i es.
Rather , i t sought t o show t hat Carpent er had mi sr epr esent ed hi s
appr oach by pur sui ng a r i ski er i nvest ment st r ategy t han exchangors
woul d have expect ed f r omt he r epr esent at i ons made and t he nat ur e of
t hei r pur poses i n ent er i ng exchange cont r act s. And he knew hi s
st r at egy di f f er ed f r om t hei r expect at i ons and he del i ber at el y
f ai l ed t o cor r ect or pr event t hose expect at i ons.
As t he government ar gued, a 1031 exchange i s commonl y
vi ewed as a conser vat i ve t r ansact i on: i t i s gener al l y pur sued by
someone who has chosen t o i nvest i n r eal est ate and i s pr i mar i l y
seeki ng t o avoi d capi t al gai ns l i abi l i t y r at her t han t o obt ai n
l ar ge, qui ck r et ur ns. Under t he gover nment ' s t heor y, t hi s sor t of
i nvest or woul d have expect ed t he f unds i n t he escr ow account s t o be
" i nvest ed" i n saf e asset s l i ke money mar ket account s or t r easur y
bi l l s. Such an i nvest i ng st r at egy coul d f ai r l y be descr i bed as
"parki ng" money, part i cul ar l y when exchangors wer e pr omi sed r et ur ns
of 3% or 6% when much hi gher r at es wer e avai l abl e i n r i ski er
i nvest ment vehi cl es. 7 By l eadi ng exchangors t o bel i eve
7 The di st r i ct cour t t ook i ssue wi t h t he speci f i c t er ms "par k"and "escr ow account " based on a t heor y, ar t i cul at ed i n i t s or derbut not t he subj ect of di scussi on at t r i al , of how banks oper at e.I n f act , each exchangor si gned a cont r act wi t h Beni st ar ent i t l ed"ESCROWAGREEMENT, " and t hose documents t hemsel ves wer e bef or e t hej ury. The cour t expl ai ned t hat an "account " i s not a separ at e"deposi t box" of money but merel y an amount a bank promi ses t o pay,
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t hat Carpent er woul d t ake t hat appr oach but i nst ead knowi ng that he
woul d i nvest i n r i ski er st ocks or opt i ons, t he gover nment ar gued,
Carpenter commi t t ed f r aud. We see not hi ng wr ongf ul i n t he manner
i n whi ch t he gover nment pr esent ed t hat argument t o t he j ur y i n t hi s
case.
3. Ref erences t o Carpent er ' s Prof i t Mot i ve
The di st r i ct cour t ' s t hi r d assi gnment of er r or was i n t he
gover nment ' s r ef er ences t o Car pent er ' s desi r e t o pr of i t of f t he
exchangor s, whi ch t he di st r i ct cour t r echar act er i zed as "greed, "
al t hough t he gover nment never used t hat t erm. The gover nment di d
r ef er t o Car pent er ' s desi r e t o t r ade i n r i ski er i nst r ument s t hat
coul d br i ng i n a gr eat er pr of i t f or hi msel f and hi s busi ness
par t ner . The gover nment al so hi ghl i ght ed t he f act t hat Car pent er
sought t o ear n t hat prof i t usi ng ot her peopl e' s money. The
di st r i ct cour t , i n i t s new t r i al or der , hel d t hat t hese comment s
i mpr oper l y dr ove t he j ur y toward a gui l t y ver di ct based on moral
and t hat banks ar e abl e t o pay i nt er est r at es i n t he f i r st pl ace byput t i ng money t o other uses. Money t hat i s "par ked, " t he cour tcont i nued, i s not i nvest ed at al l under a l i t er al under st andi ng oft he economi c t heory and t her ef ore coul d not have earned i nt er est .The di st r i ct cour t concl uded t hat " [ t ] he exchangor s, al l r el at i vel ysophi st i cat ed i n busi ness, must al l have expect ed" t hat t hei rso- cal l ed "parked" f unds woul d somehow be i nvest ed. But t he j ur ywas f r ee t o deci de that t he exchangor s, sophi st i cat ed t hough t hey
may be, under st ood "account " and "park" i n t he ordi nary sense. Thecour t ' s or der al so does not deal at al l wi t h t he evi dence act ual l ypr esent ed to t he j ur y, and Car pent er has not i dent i f i ed any poi nti n t he t r i al wher e he devel oped t hat st r i ct t heor y. I f Car pent erwant ed t he f act f i nder t o use a di f f er ent meani ng of "par k" and"escr ow account " t han an ordi nary per son woul d use, Carpent er coul dhave pr esent ed hi s al t er nat i ve t o t he j ur y.
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chast i sement of Car pent er r at her t han the el ement s of t he f r aud
cr i mes charged. We di sagr ee f or sever al r easons.
The ar gument was a l egi t i mat e one di r ect l y r el at ed t o t he
government ' s bur den of showi ng i nt ent . To have commi t t ed f r aud
agai nst t he exchangors, Carpent er must have had t he speci f i c i nt ent
t o mi sl ead t hem at t he t i me he sol i ci t ed t hei r busi ness. The
gover nment ' s ar gument went t o why Car pent er had a mot i ve t o commi t
f r aud. Thi s f r aud woul d i ncrease t he amount of money he woul d make
of f of t he exchangor s' i nvest ment s. Had t her e been f ul l
di scl osur e, especi al l y af t er Car pent er knew hi s r i sky i nvest ment
st r at egy had f ai l ed, t he exchangors woul d never have made t he
i nvest ment s t o begi n wi t h or mai nt ai ned t hem wi t h Beni st ar .
I n addi t i on, we do not t hi nk such argument coul d have
di st r acted t he j ur y f r om t he t ask bef or e i t or di st r acted i t f r om
i t s eval uat i on of t he evi dence of Car pent er ' s i nt ent .
B. New Tr i al Or der
None of t he comment s t hat t he di st r i ct cour t r el i ed upon
as t he basi s f or or der i ng a new t r i al wer e act ual l y i mpr oper .
Because t he di st r i ct cour t commi t t ed an er r or of l aw i n det er mi ni ng
t hat t he cl osi ng ar gument was i mpr oper , i t necessar i l y abused i t s
di scret i on i n gr ant i ng t he new t r i al , and we r ever se. Cf . Uni t ed
St at es v. Conl ey, 249 F. 3d 38, 47 ( 1st Ci r . 2001) ( r ever si ng
di st r i ct cour t ' s new t r i al or der when di st r i ct cour t appl i ed
i ncorr ect l egal st andard) . We need not r each t he gover nment ' s
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ot her ar gument s f or r ever sal , i ncl udi ng i t s al t er nat i ve ar gument
t hat t he di st r i ct cour t er r ed i n f ai l i ng t o appl y pl ai n er r or
r evi ew, because we have f ound t hat t here was no i mpr opr i ety i n t he
government ' s cl osi ng argument . However , we do consi der Carpent er ' s
ar gument t hat t he di st r i ct cour t or der shoul d be af f i r med f or ot her
r easons.
C. Car pent er ' s Al t er nat i ve Ar gument s
Recogni zi ng t hat t hi s cour t on appeal i s f r ee t o af f i r m
t he di st r i ct cour t ' s deci si on on any i ndependent l y suf f i ci ent
gr ound, see Uni t ed St at es v. Robl es, 45 F. 3d 1, 5 ( 1st Ci r . 1995) ,
Car pent er ar gues t hat t he t r i al cont ai ned sever al ot her er r or s t hat
suppor t af f i r mance of t he new t r i al or der . He i dent i f i es f our
er r or s wi t hi n t he gover nment ' s cl osi ng: ( 1) t he gover nment undul y
emphasi zed Carpent er ' s l osses; ( 2) t he government undul y emphasi zed
t he r i ski ness of Car pent er ' s i nvest i ng st r at egy; ( 3) t he gover nment
mi schar act er i zed part s of t he evi dence; and ( 4) t he gover nment
i mpr oper l y gave a per sonal opi ni on ( "t hat ' s f r aud") . He al so
poi nt s t o an er r or dur i ng t he gover nment ' s pr i nci pal case at t he
t r i al , cont endi ng t hat t he gover nment knowi ngl y r el i ed on f al se
t est i mony. The di st r i ct cour t pr oper l y di d not f i nd t hat any of
Car pent er ' s argument s on t hese poi nt s j ust i f i ed a new t r i al when i t
consi der ed t hem i n i t s new t r i al or der .
Carpent er di d not pr eserve t he per sonal opi ni on argument
because he f ai l ed t o obj ect cont empor aneousl y or t o i ncl ude i t i n
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hi s obj ect i ons i mmedi at el y af t er t he cl osi ng ar gument . See, e. g. ,
Uni t ed St at es v. Goodhue, 486 F. 3d 52, 55 ( 1st Ci r . 2007) ( "An
i ssue i s preserved f or appeal when t he appel l ant adequat el y
pr eser ved t he i ssue t hr ough a t i mel y and cont emporaneous obj ect i on
t o t he di st r i ct cour t . " ) . However , he pr eser ved each of t he ot her
f our ar gument s by obj ect i ng t o t hem at t he cl osi ng ( or dur i ng t he
t r i al as t o t he f al se t est i mony, whi ch was not at i ssue i n t he
cl osi ng) and hi ghl i ght i ng t hem i n hi s br i ef s on t he new t r i al
mot i on i n t he di st r i ct cour t and on appeal .
We r evi ew pr eserved obj ect i ons of t hi s sor t f or har ml ess
er r or . See Uni t ed St at es v. Sasso, 695 F. 3d 25, 29 ( 1st Ci r .
2012) . That i s because Car pent er ' s asser t i ons of er r or "ar e not of
const i t ut i onal di mensi on, " and so t he convi ct i on wi l l st and despi t e
any er r or "as l ong as i t can be sai d ' wi t h f ai r assur ance, af t er
ponder i ng al l t hat happened wi t hout st r i ppi ng t he er r oneous act i on
f r om t he whol e, t hat t he j udgment was not subst ant i al l y swayed by
t he er r or . ' " I d. ( quot i ng Kot t eakos v. Uni t ed St at es, 328 U. S.
750, 765 ( 1946) ) . We r evi ew t he unpr eserved obj ect i on f or pl ai n
er r or . See Uni t ed St at es v. Andj ar - Basco, 488 F. 3d 549, 561 ( 1st
Ci r . 2007) . Appl yi ng t hese st andards, we concl ude t hat none of
Car pent er ' s al t er nat i ve gr ounds i s suf f i ci ent t o af f i r m t he new
t r i al order .
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1. Gover nment ' s Focus on Actual Losses and Ri ski ness
Carpent er at t acks t he gover nment ' s f ocus on Carpent er ' s
act ual l osses and on t he r i ski ness of hi s i nvest ment s wi t hi n i t s
cl osi ng argument . But t he government ' s ar gument s pr oper l y went t o
i t s t heor y of Car pent er ' s f r aud: as t o r i sk, mi sr epr esent at i ons of
how t he money woul d be i nvest ed, and as t o t he l osses,
mi sr epr esent at i ons of t he f i nanci al st at e of hi s company and t he
l i kel i hood t hat exchangor s woul d act ual l y be pai d back t hei r
pr i nci pal wi t h t he pr omi sed i nt er est .
2. Gover nment ' s Knowi ng Use of Fal se Test i mony
Wi t hi n hi s compl ai nt about t he gover nment ' s f ocus on t he
r i ski ness of hi s i nvest ment s, Car pent er al so ar gues t hat t he
gover nment knowi ngl y i nt r oduced f al se t est i mony f r om one of i t s
wi t nesses. That cl ai m asser t s an er r or under Napue v. Peopl e of
t he St at e of I l l . , 360 U. S. 264 ( 1959) . Under Napue, a new t r i al
i s r equi r ed "i f t he f al se t est i mony coul d i n any reasonabl e
l i kel i hood have af f ect ed t he j udgment of t he j ur y. " Uni t ed St at es
v. Mangual - Gar ci a, 505 F. 3d 1, 10 ( 1st Ci r . 2007) ( quot i ng Gi gl i o
v. Uni t ed St at es, 405 U. S. 150, 154 ( 1972) ) ( i nt er nal quot at i on
mark omi t t ed) . However , we have r ecogni zed t hat t hi s rul e i s not
absol ut e; f or exampl e, we have decl i ned t o r equi r e a new t r i al when
t he def endant has knowl edge of t he f al se t est i mony and f ai l s t o
r ai se t he i ssue. See Mangual - Gar ci a, 505 F. 3d at 10- 11.
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The di st r i ct cour t , i n a separ at e or der denyi ng
Car pent er ' s mot i on f or a mi st r i al on t hese gr ounds, expl i ci t l y
consi der ed Car pent er ' s cl ai ms r egar di ng t he l yi ng wi t ness and
concl uded t hat t he wi t ness was i n f act l yi ng and t hat t he
government knew t he t est i mony was f al se. However , i t al so
expl ai ned t hat t he gover nment made al l necessary di scl osur es and
t hat Carpent er consequent l y was abl e t o and di d cross- exami ne t he
l yi ng wi t ness "vi gor ousl y. " The di st r i ct cour t t her ef or e
det er mi ned t hat a mi st r i al was not war r ant ed on t hi s basi s. On
appeal , Car pent er has not i dent i f i ed any r easonabl e l i kel i hood t hat
t he j ur y' s ver di ct i n t hi s case was i mpact ed by the f al se t est i mony
i n l i ght of hi s vi gor ous cr oss- exami nat i on. 8 That ends t hi s
attack.
8
Car pent er ' s sol e cont ent i on on t hi s poi nt i s t hat t he f al set est i mony "arguabl y" r ai sed doubt as t o whet her Carpent er "wasf or t hr i ght " wi t h Mer r i l l Lynch, and t hat t hi s doubt coul d haveper mi t t ed t he j ur y to bel i eve t hat he was l ess t han f or t hr i ght wi t hhi s cl i ent s as wel l . Though he nei t her r ef er s t o Feder al Rul e ofEvi dence 404( b) nor i nvokes i t s l anguage, he essent i al l y ar guest hat t he t est i mony coul d have been i mpr oper l y used as pr opensi t yevi dence i n vi ol at i on of t hat r ul e. See Fed. R. Evi d. 404( b) ( 1)( pr ohi bi t i ng use of evi dence of cr i mes, wr ongs, or bad act s t opr ove act i on i n accor dance wi t h t hat char act er ) . But Car pent er ' sRul e 404( b) ( 1) ar gument f al l s f ar shor t of t he r equi si t e" r easonabl e l i kel i hood" showi ng. For one t hi ng, Car pent er cl ai ms
t hat t he t est i mony onl y "arguabl y" r ai sed doubt s about hi sf or t hr i ght ness wi t h Mer r i l l Lynch; he does not show t hat t het est i mony "l i kel y" r ai sed such doubt . For anot her t hi ng, even i fdoubt wer e r ai sed, Car pent er asser t s mer el y t hat i t coul d haveper mi t t ed t he j ur y t o bel i eve t hat he was di shonest wi t h hi scl i ent s as wel l . He does not show t hat such an i nf er ence was"r easonabl y l i kel y. "
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3. Government ' s Al l eged Mi scharact er i zat i on ofCarpent er ' s Knowl edge
Carpent er next compl ai ns t hat t he government on r ebut t al
char act er i zed hi mas havi ng di r ect knowl edge of t he cont ent s of t he
mar ket i ng mat er i al s and per sonal l y del et i ng cer t ai n wor ds f r om
t hem. These char act er i zat i ons ar e possi bl e i nf er ences but ar e f ar
f r om r equi r ed by t he evi dence. Thr oughout t he t r i al , Car pent er
consi st ent l y pr ot est ed agai nst t r eat i ng t hemas r equi r ed i nf er ences
or pr oven f act s.
The di st r i ct cour t t ook prompt st eps t o addr ess any er r or
i n pr eci sel y the way that Car pent er ' s counsel r equest ed, gr ant i ng
a cur at i ve i nst r ucti on. The cour t ' s i nst r ucti on t ol d j ur or s
expl i ci t l y t hat "[ t ] her e i s no evi dence t hat Mr . Car pent er was
r esponsi bl e f or changi ng t he agr eement . You have evi dence of t wo
di f f er ent agr eement s, but t here' s no evi dence as t o how t hey came
t o be di f f er ent , and so t hat woul d not be an appr opr i at e t hi ng f oryou t o t ake i nt o consi der at i on. " I n l i ght of t hat cl ear and pr ompt
i nst r uct i on, i t i s not l i kel y t hat t he out come swayed. See
Ol szewski v. Spencer , 466 F. 3d 47, 60 ( 1st Ci r . 2006) ( not i ng t hat
"wher e t he pr osecut or uni nt ent i onal l y mi sst at es t he evi dence dur i ng
cl osi ng ar gument , a j ur y i nst r ucti on or di nar i l y" i s suf f i ci ent t o
cur e any er r or , "par t i cul ar l y wher e" t he i nst r uct i on "was gi veni mmedi at el y af t er t he st at ement " ) .
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4. Government ' s Use of Personal Opi ni on
Carpent er ' s f i nal argument i s t hat t he gover nment
i mpr oper l y i nt r oduced a per sonal opi ni on dur i ng i t s cl osi ng by
decl ar i ng at mul t i pl e poi nt s, "t hat ' s f r aud. " Because Car pent er
di d not cont empor aneousl y obj ect t o t hi s poi nt , our r evi ew i s f or
pl ai n er r or . 9 To pr evai l on pl ai n er r or r evi ew, Car pent er must
show t hat t he comment s " wer e pr ej udi ci al and af f ect ed hi s
subst ant i al r i ght s, " and t hat t he er r or "caused a ' mi scar r i age of
j ust i ce' or ser i ousl y undermi ned t he ' i nt egr i t y or publ i c
r eput at i on of j udi ci al pr oceedi ngs. ' " Uni t ed St at es v. Hender son,
320 F. 3d 92, 105 ( 1st Ci r . 2003) ( quot i ng Uni t ed St at es v. Ol ano,
507 U. S. 725, 736 ( 1993) ) .
Carpenter has not met t hat bur den. Al t hough t hey may
sound l i ke t he pr osecut or ' s opi ni ons i n i sol at i on, t he comment s
9 Carpent er argues t hat hi s obj ect i on was pr eser ved becauset he di st r i ct cour t i nt er r upt ed hi s at t or ney whi l e hi s at t or ney wasmaki ng a set of obj ect i ons i mmedi atel y af t er t he gover nment ' scl osi ng ar gument , ci t i ng Uni t ed St at es v. Wi hbey, 75 F. 3d 761, 769( 1st Ci r . 1996) . That ar gument f ai l s f or t hr ee r easons. Fi r st ,Wi hbey di d not hol d t hat an obj ect i on i s preserved i n such asi t uat i on, but mer el y assumed ar guendo t hat i t coul d be. See i d.Second, Wi hbey i s di st i ngui shabl e on i t s f act s, as counsel t her emoved f or a mi st r i al af t er t he pr osecut i on' s r ebut t al - -essent i al l y t he f i r st oppor t uni t y af t er t he ear l i er at t empt t oobj ect was r ebuf f ed - - wher eas t he new t r i al mot i on her e was f i l ed
af t er the j ur y r et ur ned i t s ver di ct. See i d. Fi nal l y, even i fi nt er r upt i ons gener al l y coul d be suf f i ci ent t o pr eser ve obj ect i ons,t her e i s s i mpl y no evi dence her e t hat Car pent er ' s at t or ney wasat t empt i ng t o make t he obj ect i on Carpent er now cl ai ms i s pr eserved;t he di st r i ct cour t i nt er r upt ed hi m onl y af t er he had di scussed atl engt h hi s obj ect i ons t o t he gover nment ' s emphasi s on Car pent er ' sl osses and appear ed pr i med t o cont i nue di scussi ng t hat t opi c al one.
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t hat Car pent er ci t es as i mpr oper opi ni ons act ual l y came i n t he
cont ext of pr oper l y encour agi ng t he j ur y t o eval uat e t he evi dence.
For exampl e, one of t he t wo i nst ances of i mpr oper opi ni on- gi vi ng
t hat Car pent er i dent i f i es i s i n t he ver y l ast sent ence of t he
gover nment ' s r ebut t al : "Thi s i s f r aud, l adi es and gent l emen, and
t hi s i s why you shoul d f i nd hi m gui l t y on each and ever y count . "
Taken i n cont ext , i t i s cl ear t hat t he prosecut i on' s comments wer e
permi ss i bl e comment s on t he evi dence i n t he case rat her t han t he
pr osecut or ' s own opi ni on. See Uni t ed St at es v. Smi t h, 982 F. 2d
681, 684 ( 1st Ci r . 1993) ; Uni t ed St ates v. Cai n, 544 F. 2d 1113,
1116 ( 1st Ci r . 1976) . Because t hese comment s i n cont ext were not
pr ej udi ci al , and cer t ai nl y di d not cause a mi scar r i age of j ust i ce,
t hey do not const i t ut e pl ai n er r or .
I I I .
For t he r easons st at ed above, t he di st r i ct cour t ' s gr ant
of t he new t r i al i s r ever sed, t he convi ct i on i s r ei nst at ed, and t he
case i s r emanded f or pr ompt sent enci ng. 10
So order ed.
10 We al so r egr et t hat i t t ook t hr ee year s f or t he di st r i ctcour t t o r ul e on t he mot i on f or new t r i al .
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