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U.S. v. MUBAYYID
658 F.3d 35 (2011)
United States Court of Appeals, First Circuit.
Heard October 4, 2010.
A. Factual Background We recount the essential facts of the case, drawn from the trial record, in the light most favorable to the verdict. E.g., United States v. Poulin, 631 F.3d 17, 18 (1st Cir.2011). Due to the complexity of the issues, we reserve additional factual detail for the analysis that follows. 1. Care's Formation and Operations Emadeddin Muntasser is a Libyan citizen and a permanent resident alien in the United States. In the early 1990s, Muntasser served as Director of the Boston branch of the Al-Kifah Refugee Center
("Al-Kifah"), the American face of Maktab al-Khidmat ("MAK"), a Pakistan-based organization that openly advocates violent, Islamic jihad and actively supports mujahideen in Afghanistan. In a letter of solicitation introduced at trial, Muntasser described Al-Kifah as "an organization founded by Sh[eikh] Abdullah Azzam to serve the cause of Jihad," and which "actively supports the Mujahideen in the front."3 Among its activities, Al-Kifah's Boston branch published a pro-jihad newsletter entitled "Al-Hussam," which translates from Arabic as "The Sword"; it sold books and audiotapes extolling the cause of jihad; and it promoted sermons and lectures by like-minded Muslim leaders. It also solicited substantial charitable donations through the publication of an annual Zakat Calculation Guide.4 Although the organization advertised itself as a tax-exempt charity, it had never been granted charitable status by the IRS. In early 1993, shortly after the World Trade Center bombing in New York City, both Newsweek and The New York Times ran articles linking the Brooklyn branch of Al-Kifah to "Islamic Militant groups, fighters in Afghanistan, and individuals who were alleged to have committed acts of violence." Within days, Muntasser dissolved the Boston branch of Al-Kifah and incorporated Care in Massachusetts. According to its articles of incorporation, Care was "organized exclusively for charitable, religious, educational, and scientific purposes including . . . human welfare, charitable and relief activities." The articles listed Muntasser as Care's President, Munther Baara as Treasurer, and Ahmad Nawras as Secretary, and identified Afif Kadri, Mohamad Akra, and Waseem Abu Yasin as board members. Baara, Nawras, Kadri, Akra, and Yasin had all served in identical positions for the Boston branch of Al-Kifah. The articles also stated, "It is intended that the corporation shall be entitled to exemption from federal income tax under Section 501(c)(3) of the Internal Revenue Code." Following its incorporation, Care effectively replaced Al-Kifah's Boston branch. It took over Al-Kifah's mailbox address and deposited financial contributions into Al-Kifah's bank account (though these contributions were eventually transferred to an account in Care's name). Care's activities also substantially mirrored those of Al-Kifah's Boston branch, including the sponsoring of pro-jihad speakers, the sale of books and tapes advocating jihad, and the continued publication of the "Al-Hussam" newsletter.5 Within the organization, individuals referred to Care as "Maktab," a shorthand reference to MAK. In its own newsletters, Care referred to itself as "the office of services," a name by which MAK was known in the United States. Like Al-Kifah, Care also represented itself to the public as "founded by Imam Abdullah Azzam," even though Abdullah Azzam had died more than three years prior to Care's formation. At trial, the government presented
two experts who testified regarding the overseas operations of MAK, Abdullah Azzam's philosophy on violent jihad, the general trend of using charitable organizations to covertly finance jihad and mujahideen, and the concept of "economic jihad"—the precept that, "[i]f you cannot be a fighter, fund a fighter." It also asked a witness to read fifty-five pages of the "Al-Hussam" newsletters into the record, primarily those sections that demonstrated Care's commitment to violent jihad and its financial solicitations for the mujahideen.
* Of the District of Rhode Island, sitting by designation.
1. At trial, witnesses for the government testified that "jihad" means "holy struggle," and specifically refers to the duty to fight against the enemies of Islam, while "mujahideen" refers to Islamic "holy warriors." In its own materials, Care defined "mujahideen" as "[t]hose who are going out for Jihad, fighting in the path of Allah."
2. The government does not challenge the district court's acquittal of Muntasser and Al-Monla on the charges of scheming to conceal material facts from a government agency or obstructing the administration of the Internal Revenue laws.
3. At trial, the government presented evidence that Abdullah Azzam founded MAK in the 1980s in Peshwar, Pakistan, and was largely credited with attracting foreign fighters to Afghanistan to fight alongside the mujahideen.
4. Zakat, one of the Five Pillars of Islam, is a form of obligatory charitable giving, similar to the Christian concept of "tithing." Zakat may only be given to a limited class of recipients, including those "in the path of Allah." Both Care and Al-Kifah construed this requirement to include the mujahideen.
5. A witness for the government testified that Care's "Al-Hussam" newsletter was "indistinguishable" from Al-Kifah's: "I mean, the format, the font, the little logo up on the top right, same exact newsletter."
6. Section 501(c)(3) of the Internal Revenue Code exempts from taxation designated entities that are "organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or educational purposes, or to foster national or international amateur sports competition . . . or for the prevention of cruelty to children or animals," provided that "no part of the net earnings of [the entity] inures to the benefit of any private shareholder or individual." 26 U.S.C. § 501(c)(3). An organization may serve non-qualifying purposes only if such purposes are not substantial and are merely incidental to the organization's qualifying operations.
7. One of the government's expert witnesses testified at trial that, as used by the mujahideen, the word "martyr" refers to "someone who is killed in combat, someone who is killed while defending or fighting in the cause of Islam."
8. The details of the federal investigation are sketchy, as the trial judge appropriately limited the jury's exposure to them.
9. According to testimony at trial, Hekmatyar was an Afghan warlord in the 1990s who was of particular interest to the FBI.
10. GRF was a charitable organization based in Chicago, Illinois. It was one of the recipients of Care's contributions. Muntasser informed an FBI agent during a 2003 interview that Chehade had previously lived in Boston and had been responsible for introducing Muntasser to Al-Kifah. GRF had a sister publication to Care's "Al-Hussam" entitled "Al-Thilal."
11. Although this language does not read like the end of the sentence, it is an accurate rendition of the recording.
12. In 2000, 2001, and 2002, Mubayyid amended Care's filings for the tax years 1997, 1999, and 2000, respectively. Consequently, his filings fell within the six-year limitations period set by 26 U.S.C. § 6531, whereas the Form 990 filings of the other two defendants did not.
13. For ease of reference, a table of the charges brought and their dispositions below is appended to this opinion.
14. The witness was examined by counsel for Muntasser, and primarily spoke to the sufficiency of Care's disclosures on its initial application for tax exemption, Form 1023.
15. As noted, Al-Monla was charged with denying that he knew a man named Bassam Kanj during an interview with the FBI in 2003. The evidence at trial indicated that Al-Monla admitted to knowing someone named "Bassam," but denied knowing his last name.
16. Because he was acquitted of all charges, Al-Monla is participating in this appeal only to defend his post-verdict acquittal on this count.
17. The government's theory of the case was that Muntasser had conspired with two unindicted co-conspirators, Mohammed Akra and Waseem Yassin, prior to seeking Care's tax exemption, and that Al-Monla and Mubayyid joined this conspiracy when they subsequently agreed with Muntasser and each other to aid in maintaining Care's fraudulent tax status.
18. Despite the strenuous arguments of the defendants to the contrary, the government preserved this argument by raising it in the district court. Although the court did not rule on the argument in its opinion and order, it expressed doubts during arguments on the defendants' Rule 29 motions that the government could permissibly "charge a conspiracy that began in '93 and prove that it began in '96."
19. The Fifth Amendment's Presentment Clause guarantees the defendants the right to be free from a trial for any offense other than that alleged in the grand jury's indictment. United States v. Miller, 471 U.S. 130, 134-35, 105 S.Ct. 1811, 85 L.Ed.2d 99 (1985). Its prohibition on double jeopardy requires that the record show with accuracy the extent to which the defendants' convictions bar subsequent prosecution. Hagner v. United States, 285 U.S. 427, 431, 52 S.Ct. 417, 76 L.Ed. 861 (1932). Due process precludes the defendants' conviction on any ground that was neither charged in the indictment nor presented to the jury. Dunn v. United States, 442 U.S. 100, 106, 99 S.Ct. 2190, 60 L.Ed.2d 743 (1979). The Sixth Amendment, meanwhile, ensures that the indictment provide the defendants with fair notice of the charges against which they are called to defend. Russell v. United States, 369 U.S. 749, 763-64, 82 S.Ct. 1038, 8 L.Ed.2d 240(1962).
20. They are also reflected in our test to determine whether a variance has affected a defendant's substantial rights, which we discuss infra. See United States v. Cruz-Arroyo, 461 F.3d 69, 77 (1st Cir.2006) ("There is no prejudicial variance so long as an indictment provides the defendant with sufficient detail to allow him to prepare a defense, avoid unfair surprise at trial, and plead double jeopardy when appropriate.").
21. The defendants further point to language in both Miller and our subsequent decision in United States v. DeCicco, 439 F.3d 36 (1st Cir.2006), that (outwardly) suggests that an indictment may be narrowed only where the narrowing removes "distinct and segregable components." See id. at 46. They argue that, because the maintenance of Care's fraudulent tax exemption was dependant on Care's initial fraudulent application for tax exemption, the latter is not distinct and segregable. The language to which the defendants point does not aid them here. That language refers to the principle that a variance is permissible so long as the indictment's remaining allegations are independently sufficient to constitute the charged crime. That is the case here.
22. See, e.g., Celestin, 612 F.3d at 25 & n. 4 (upholding a conviction where the trial judge's instruction to the jury "eliminated a theory of liability rather than removed an element of the crime" under the applicable statute, and thus merely "narrowed the permissible bases for conviction"); United States v. Dowdell, 595 F.3d 50, 68 (1st Cir.2010) (upholding the literal alteration of an indictment to change the controlled substance involved because the nature of the substance is not a statutory element); United States v. Gomez-Rosario, 418 F.3d 90, 104 (1st Cir.2005) (finding no constructive amendment where jury found defendant "guilty of the crime charged but responsible for a lesser quantity of drugs than that specified in the indictment" because drug quantity is not a statutory element); cf. United States v. Bello-Perez, 977 F.2d 664, 669 (1st Cir.1992) (holding that, in conspiracy with no overt act element, "the government is not limited at trial to proof of the [gratuitously] alleged overt acts").
23. Certainly, the Sixth Amendment's right to notice of one's criminal charges requires that the indictment do more than parrot the words of a statute; "the statutory language `must be accompanied with such a statement of the facts and circumstances as will inform the accused of the specific offense, coming under the general description, with which he is charged.'" United States v. Mojica-Baez, 229 F.3d 292, 309 (1st Cir.2000) (quoting Hamling v. United States, 418 U.S. 87, 117-18, 94 S.Ct. 2887, 41 L.Ed.2d 590 (1974)). Any claim that upholding their convictions on the ground of variance would deprive the defendants of fair notice of their crime is more properly a claim of prejudice, however. See infra. It does not inform our analysis of whether the government's failure to prove all that it included in the indictment impermissibly altered "the crime charged."
24. The cases that reflect the opposite conclusion involve situations where the government's failure to prove the crime as it was charged in the indictment opens the possibility that the jury convicted on the basis of conduct that was never charged. See, e.g., United States v. Narog, 372 F.3d 1243, 1247-49 (11th Cir.2004).
25. We note that the defendants conspicuously avoided almost any reference to the concept of constructive amendment in their briefing to this court. The government, on the other hand, aptly pointed out that the defendants were "[c]onflating and confusing the distinct concepts of variance and constructive amendment."
26. The memorandum accompanying Muntasser's motion read as follows:
The defendants are charged, in count two, with a conspiracy to defraud the United States. . . . But the government has introduced absolutely no evidence, direct or circumstantial, of any agreement, express or implied, between these three defendants. There is no evidence of what, if anything, they agreed to, nor any evidence tying Mr. Muntasser to any agreement, whatever it might have been, after September 1996.
27. The government's theory at trial was that Muntasser had conspired with unindicted co-conspirators in 1993 to fraudulently obtain Care's tax exemption, that Al-Monla joined that conspiracy at some later time by agreeing with Muntasser, an unindicted co-conspirator, or both, to fraudulently maintain Care's tax status for the indefinite future, and that Mubayyid subsequently conspired with Al-Monla to do the same.
28. As we have explained, the notice and "prejudicial spillover" arguments that were persuasive in United States v. Dellosantos, 649 F.3d 109 (1st Cir.2011), are not persuasive here. Unlike Dellosantos, this case does not involve two or more distinct conspiracies with "different products, a different source of supply, different goals, and a different history." See id. at 121. Rather, the defendants in this case claim a lack of notice because they erroneously believed that the conspiracy charge would fail if the government could not prove that the single tax-related conspiracy in which the defendants participated extended for the entire period of time and involved all of the tax filings alleged in the indictment. Additionally, we found the variance in Dellosantos prejudicial because it allowed the government to introduce "voluminous testimony relating to unconnected crimes in which [the appellants] took no part" perpetrated by sixteen co-defendants. Id. at 125. That evidence, wholly irrelevant to the conspiracy involving the appellants, created an impermissible risk that the jury would find the appellants guilty of one conspiracy solely because their co-defendants engaged in a different conspiracy. Id. That risk does not exist here.
29. Title 18, § 371 also requires proof of an overt act in furtherance of the conspiracy by at least one conspirator. However, there can be no serious debate that this requirement has been met here: in the years covered by the indictment, each of the three defendants filed at least one Form 990 with the IRS, through which Care maintained its fraudulently obtained tax exemption.
30. Affif Kadri, one of Care's founding directors, testified for the government in this respect. He explained that, for example, Waseem Yassin, also listed as a director, was heavily involved in the organization simply as "the go-around guy. . . . Anything that needs to be done, or you know, whatever it is, he's there when that person or people make it happen." Al-Monla eventually told the FBI during his 2003 interview that Yassin was one of the officers primarily responsible for directing Care's charitable disbursements.
31. As we noted previously, Mubayyid also joins Muntasser in claiming prejudicial spillover from the introduction of so-called "terrorism evidence." We address Muntasser and Mubayyid's joint claim separately, infra.
32. Mubayyid does not challenge the other elements required to show a violation of § 7206(1): that he filed a verified return for the year(s) at issue and that the return contained a written declaration that it was made under penalty of perjury. See Boulerice, 325 F.3d at 79-80.
33. In a footnote in United States v. Boskic, 545 F.3d 69, 91 n. 22 (1st Cir.2008), we stated, correctly, that "the question of objective reasonableness was for the judge to decide in considering whether the government had presented enough evidence to allow the jury to find the statement false." However, the fact that the judge has concluded that a defendant's interpretation of the question is unreasonable, and hence has rejected a defendant's argument that the question, so interpreted, is fundamentally ambiguous, does not mean that the jury cannot still consider the defendant's interpretation of the question in deciding whether the defendant willfully and knowingly gave a false answer to the question. To the extent that our statement in Boskic suggests otherwise, it is inaccurate.
34. Both understandings of the timing were argued to the jury. The prosecutor urged the jury to convict Mubayyid for failing to disclose in the 1997, 1999, and 2000 tax returns that Care had published the "Al-Hussam" newsletters from 1993 to 1997. Mubayyid's counsel argued that the evidence was insufficient based on the more limited temporal scope, asserting, "In 1999 there was no newsletter. In 2000 there was no newsletter. There was only this website." In rebuttal, the government argued that Mubayyid's failure to report the website was also a material non-disclosure. The court then instructed the jury to "consider whether a defendant's response was actually false under each reasonable interpretation of the question or instruction." The jury's verdict may thus be upheld if the evidence showed that Mubayyid knew that reportable activities had taken place during 1997, 1999, and 2000—i.e., that he knowingly replied falsely when asked whether, during each of those years, "the organization engage[d] in any activity not previously reported to the IRS." See United States v. Gobbi, 471 F.3d 302, 309 (1st Cir.2006) ("The law is crystalline that, when the government has advanced several alternate theories of guilt and the trial court has submitted the case to the jury on that basis, an ensuing conviction may stand as long as the evidence suffices to support any one of the submitted theories.") (citing Griffin, 502 U.S. at 49-51, 112 S.Ct. 466).
On appeal, Mubayyid also argues that a statement by the prosecutor—"That question was not limited to that tax year. . . . The question was: `Has the organization ever engaged in any activity not disclosed to the IRS?'"— was prosecutorial misconduct because it incorrectly recites the language of Question 76. In the context cited above, however, the statement is most sensibly read as the prosecutor's suggestion to the jury of how to interpret the question. It is therefore not error. See, e.g., United States v. Henderson, 320 F.3d 92, 105 (1st Cir.2003) (noting that a prosecutor "may attempt to persuade the jury to draw inferences unfavorable to the defense" (quoting United States v. Smith, 982 F.2d 681, 683 (1st Cir.1993))).
35. Given our description of the newsletter's importance to the purposes of the organization, we think it beyond debate that the falsity was "material." See Boulerice, 325 F.3d at 79 (stating that the government was required to prove that "the tax return was false as to a material matter" (quoting LaSpina, 299 F.3d at 179)).
36. 18 U.S.C. § 1001(a) provides in relevant part:
[W]hoever, in any matter within the jurisdiction of the executive, legislative, or judicial branch of the Government of the United States, knowingly and willfully—
(1) falsifies, conceals, or covers up by any trick, scheme, or device a material fact;
. . .
shall be fined under this title, imprisoned not more than 5 years or, if the offense involves international or domestic terrorism (as defined in section 2331), imprisoned not more than 8 years, or both.
37. Because the jury was instructed that it was required to find that the fact concealed was material to the IRS, Mubayyid's conviction under § 1001(a)(1) for a scheme to conceal material facts rests on the same conduct that forms the basis of his false tax filing convictions pursuant to 26 U.S.C. § 7206(1), which criminalizes materially false representations on subscribed tax filings, and his conviction for corruptly endeavoring to obstruct the due administration of the IRS pursuant to 26 U.S.C. § 7212(a).
38. Because we have ordered that the conspiracy conviction be reinstated, which will require re-sentencing, we do not consider Muntasser's additional claims related to sentencing.
39. "Retroactive misjoinder occurs where joinder was proper initially because of a conspiracy allegation, but where later developments, such as the district court's decision in the case months later to set aside a defendant's conspiracy conviction, appear to render the initial joinder improper." United States v. Deitz, 577 F.3d 672, 693 (6th Cir.2009) (alterations omitted) (quoting United States v. Warner, 690 F.2d 545, 553 (6th Cir. 1982)) (internal quotation marks omitted).
40. For example, when the government presented expert testimony describing the operations of Al-Kifah and MAK, the judge instructed the jury as follows:
Testimony concerning—or testimony has been admitted concerning the organization and activities of Al-Kifah and the organization and activities of Care. And it's to go to this issue, the successor or outgrowth issue. And you may consider that issue only for that purpose. And just to be clear, defendants are not charged with any actions or activities relating to MAK or Al-Kifah. The issue here is the successor or outgrowth issue. And you may not conclude or infer or surmise that the defendants are somehow charged with or responsible for the actions or activities of MAK or Al-Kifah. They are not. Again, it's solely this issue of successor or outgrowth and, in effect, comparing the activities or organization of the two organizations.
41. For example, the jury asked, "Does Muntasser asking for a lawyer negate his previous answer `no' twice visiting Afghanistan to Special Agent Peet?" The trial judge correctly instructed that Muntasser's request for a lawyer rendered no part of the FBI's questioning legally impermissible, but that the jury was free to consider all of the evidence concerning the interview and to give it such weight as it deserves.
42. According to Agent Peet, he would have asked such additional questions as, "Where was the safe house in Peshwar? Who was guarding that safe house? Are Pakistani authorities in compliance with [sic] that safe house?" Additionally, he stated, "We would have asked if false identification had been used to get across the border; were Pakistani authorities helping him; what Afghans were helping him; where the meeting took place; and, again, under what circumstances did the meeting take place."
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