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John Arthur Boultbee v. United States of America

August 14, 2012

JOHN ARTHUR BOULTBEE, PETITIONER,
v.
UNITED STATES OF AMERICA, RESPONDENT.



The opinion of the court was delivered by: Amy J. St. Eve, District Court Judge:

MEMORANDUM OPINION AND ORDER

Before the Court is pro se Petitioner John Arthur Boultbee's motion to vacate, set aside, or correct his sentence pursuant to 28 U.S.C. § 2255. For the following reasons, the Court denies Petitioner's Section 2255 motion and declines to certify any issues for appeal pursuant to 28 U.S.C. § 2253(c)(2).

FACTUAL BACKGROUND

I. Charges

On August 17, 2006, a federal grand jury returned a seventeen-count Third Superseding Indictment against Petitioner and his co-defendants Conrad Black, Peter Atkinson, and Mark Kipnis, all of whom were senior executives at Hollinger International.*fn1 On January 10, 2007, the government filed a Superseding Information removing some of the allegations from the Third Superseding Indictment. The Superseding Information charged Petitioner and his co-defendants with committing the following offenses: (1) mail and wire fraud in violation of 18 U.S.C. §§ 1341, 1343, including the deprivation of the intangible right to honest services in violation of 18 U.S.C. § 1346; (2) money laundering in violation of 18 U.S.C. § 1957; (3) obstruction of justice in violation of 18 U.S.C. § 1512(c)(1); (4) racketeering in violation of 18 U.S.C. § 1962(c); and (5) criminal tax violations in violation of 26 U.S.C. § 7206(2).

II. Jury Trial

On July 13, 2007, after extensive pretrial proceedings, approximately four months of trial, and two weeks of jury deliberations, a jury convicted Petitioner and his co-defendants on several counts of the Superseding Information. In particular, the jury convicted Petitioner and his co-defendants on several mail and wire fraud counts in violation of 18 U.S.C. §§ 1341, 1346, involving non-existent covenants not to compete. After the jury convicted Petitioner, the Court sentenced him to 27 months imprisonment in December 2007.

Relevant to this Section 2255 motion is Count Seven of the Superseding Information. Count Seven charged a scheme to defraud involving $600,000 in non-competition payments taken out of the reserves from two transactions -- the Forum and Paxton transactions -- in which Hollinger International's newspapers were sold. The Superseding Information specifically charged that Petitioner and his co-defendants knowingly caused a mailing in furtherance of the scheme on or about April 9, 2001, which contained four checks: $285,000 for Black; $285,000 for Radler; $15,000 for Petitioner; and $15,000 for Atkinson. To establish Petitioner guilty of Count Seven, the government had to prove beyond a reasonable doubt that: (1) Petitioner knowingly devised or participated in a scheme to defraud or to obtain money or property by means of materially false pretenses, representations, or promises; (2) Petitioner did so knowingly and with the intent to defraud; and (3) a mailing in furtherance of the scheme. See 18 U.S.C. 1341, 1343; see also United States v. Howard, 619 F.3d 723, 727 (7th Cir. 2010).

At trial, the government introduced evidence that co-schemer Radler directed $600,000 remaining in the reserves from the Forum and Paxton transactions as supplemental non-compete payments, including $15,000 to Petitioner. Although Petitioner maintains that these payments were legitimate bonuses, the trial evidence established beyond a reasonable doubt that he never received any legitimate bonus payments from any subsidiary of Hollinger International. Also, Petitioner received his check even though he never executed a non-competition agreement and the purchasers never requested any such agreements. Further, the government introduced evidence that Petitioner did not disclose the $15,000 in his proxy questionnaire related to certain United States Securities and Exchange Commission ("SEC") disclosures.

Also relevant to this Section 2255 motion is that the government submitted the fraud counts to the jury on two theories: (1) conventional pecuniary fraud; and (2) a scheme to deprive Hollinger International of its "intangible right of honest services" pursuant to 18 U.S.C. § 1346.

III. Appeals

Petitioner and his co-defendants appealed to the United States Court of Appeals for the Seventh Circuit bringing the following claims: (1) there was insufficient evidence that they engaged in conventional pecuniary fraud; (2) the government's honest services theory was legally invalid; (3) there was insufficient evidence of fraud and a criminal mailing concerning certain supplemental payments to support the fraud allegation in Count Seven; (4) the Court erred in giving the conscious avoidance ("ostrich") instruction; and (5) the Court should have given an instruction concerning misrepresentations that occurred after the dates of the charged scheme. On June 25, 2008, the Seventh Circuit rejected these arguments and affirmed the defendants' convictions. See United States v. Black, 530 F.3d 596 (7th Cir. 2008).

Thereafter, the United States Supreme Court granted the defendants' petition for certiorari and eventually held that the honest services jury instruction was erroneous because -- unless the defendants received a bribe or kickback -- 18 U.S.C. § 1346 was unconstitutionally vague. See Skilling v. United States, 561 U.S. ___, 130 S.Ct. 2896, 177 L.Ed.2d 619 (2010); Black v. United States, 561 U.S. ___, 130 S.Ct. 2963, 177 L.Ed.2d 695 (2010). The Supreme Court remanded the matter to the Seventh Circuit to determine whether this instructional error was harmless. The parties then filed their Circuit Rule 54 Statements of Position and Responses to the Seventh Circuit. Shortly thereafter, the Seventh Circuit held that the instructional error was harmless as to one of the fraud counts, namely, Count Seven, and remanded the matter for a new trial on the remaining fraud counts. The Seventh Circuit, however, also advised the government to consider dismissing the remaining fraud counts.

In its 2010 opinion on remand, the Seventh Circuit discussed the trial evidence supporting the pecuniary ...


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