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Fuchs v. United States

United States District Court, N.D. Illinois

April 24, 2014

Mitchell A. Fuchs, Defendant,
v.
United States of America, Plaintiff.

ORDER

FREDERICK J. KAPALA, District Judge.

Fuchs' motion to vacate, set aside, or correct sentence pursuant to § 2255 [1] is denied. Certificate of appealability is denied. This case is closed.

STATEMENT

On November 4, 2008, a jury convicted Mitchell Fuchs of thirteen counts of wire fraud and one count of interstate carrier fraud which revolved around his fabrication and falsification of documents in order to permit his clients to qualify for subprime loans. After a successful appeal challenging his original sentencing, Fuchs was ultimately sentenced to 117 months of imprisonment and ordered to pay $183, 956.75 in restitution. Currently before the court is Fuchs' motion to vacate, set aside, or correct his sentence pursuant to 28 U.S.C. § 2255 based on a number of arguments. For the reasons which follow, Fuchs' motion is denied.

I. BACKGROUND

Based on the evidence presented at his criminal trial, Fuchs worked for Mortgage Solutions, a mortgage broker, that helped its clients finance real-estate transactions. The jury convicted Fuchs of doctoring residential loan applications in a number of different ways to make his high-risk clients appear to be less risky, and thus qualify for various subprime loans. Fuchs received payment on a commission basis for his work. When the FBI learned of his behavior and raided Mortgage Solutions, Fuchs took a job with another broker, Leader Mortgage, and continued his behavior unabated. He was eventually connected to fourteen fraudulent loans, many of which had ended up in foreclosure. During both his trial and sentencing, Fuchs was represented by retained counsel, David Caulk.

At sentencing, the government argued for the imposition of a two-level enhancement to the guidelines range based on U.S.S.G. § 3B1.3 on the grounds that Fuchs abused a position of trust in the commission of his crime. Following precedent from other circuits, this court applied the two-level enhancement, which resulted in an advisory guidelines range of 100 to 125 months. The court varied upward from the advisory guidelines range and imposed a sentence of 144 months of imprisonment, plus restitution. Fuchs appealed, raising only the § 3B1.3 enhancement. On appeal, Fuchs was represented by a different appointed appellate attorney, April Sellers. The Seventh Circuit agreed with Fuchs, holding that the two-level § 3B1.3 enhancement does not automatically apply to the broker-mortgagor relationship and that it did not apply specifically in Fuchs' case. See United States v. Fuchs , 635 F.3d 929, 931 (7th Cir. 2011). Accordingly, the Court vacated and remanded for resentencing. Id.

After briefing and argument, but prior to the release of the opinion while the case was still pending before the Seventh Circuit, Sellers moved to withdraw from her representation of Fuchs. In her motion, she indicated that it had come to her attention that her firm, Baker & Daniels, LLP, represented ACC Capital Holdings, one of the victims whose agents testified at Fuchs' trial and one of the entities to which he owed restitution. The motion was filed nearly ten months after oral arguments and briefing were complete before the Seventh Circuit, but approximately two weeks before it released its opinion. In the motion, Sellers indicated that she did not believe she had a conflict, as the representation of ACC Capital Holdings was on a different matter and did not limit her representation of Fuchs, but moved to withdraw in any event at the request of Fuchs. The Seventh Circuit denied Sellers' motion to withdraw five days after releasing its opinion, but denied it without prejudice to raising the issue again in the district court. United States v. Fuchs, No. 09-1611, slip op. at 1 (7th Cir. Mar. 22, 2011). Following that denial, Fuchs filed a pro se motion for new appellate counsel and requested that he be permitted to raise additional unidentified issues on appeal. The Seventh Circuit denied Fuchs' motion. United States v. Fuchs, No. 09-1611, slip op. at 1 (7th Cir. Mar. 30, 2011).

On remand, this court permitted Sellers to withdraw and appointed a new attorney to represent Fuchs. Fuchs' new attorney moved the Seventh Circuit to withdraw its mandate in the original appeal, in order to assert additional issues, but that request was denied. United States v. Fuchs, No. 09-1611, slip op. at 1 (7th Cir. June 22, 2011).

At resentencing, the new advisory guidelines range was 84 to 105 months. This court again varied upward from the advisory guidelines range and imposed a sentence of 117 months. Fuchs appealed, but his new appointed attorney moved to withdraw pursuant to Anders v. California , 386 U.S. 738 (1967), asserting that there were no non-frivolous arguments to pursue on appeal. Fuchs filed a memorandum in opposition, but the Seventh Circuit ultimately ruled that the appeal was frivolous, permitted the withdrawal, and dismissed the appeal. See United States v. Fuchs, 458 F.Appx. 552, 553 (7th Cir. 2012). Fuchs filed a pro se motion for rehearing, raising some of the issues now raised before this court, but all of the active Seventh Circuit judges, and the entire original panel, rejected his request for rehearing. See United States v. Fuchs, No. 11-2657, slip op. at 1 (7th Cir. Mar. 21, 2012).

Now Fuchs has filed a motion to vacate, set aside, or correct his sentence pursuant to § 2255. In his original motion, Fuchs set out broad conclusory allegations of wrongdoing based on the actions of the courts and attorneys involved in his prosecution. The United States responded, requesting that the court permit Fuchs to file an amended motion to narrow the issues raised to cognizable legal arguments and add clarity to those claims. Fuchs has filed such an amended motion, [1] and in it has set out six grounds for relief, although each ground has multiple sub-issues identified in a shotgun-style request for relief (most of identified issues are still raised in a perfunctory and conclusory manner). The broad grounds, which this court will use to orient its analysis, are: (1) that the Seventh Circuit erred in at least eighteen ways in its various opinions, (2) that a conflict of interest existed with Sellers, (3) that his appellate counsel was otherwise ineffective on a number of grounds, (4) that his trial counsel was ineffective on a number of grounds, (5) that the United States committed various kinds of prosecutorial misconduct, and (6) that this court engaged in various kinds of misconduct and error.

II. DISCUSSION

Relief under § 2255 is "an extraordinary remedy because it asks the district court essentially to reopen the criminal process to a person who already has had an opportunity for full process." Almonacid v. United States , 476 F.3d 518, 521 (7th Cir. 2007). Accordingly, habeas relief under § 2255 is "reserved for extraordinary situations." Prewitt v. United States , 83 F.3d 812, 816 (7th Cir. 1996). "To succeed on a § 2255 petition a convicted defendant must show that the district court sentenced him in violation of the Constitution or laws of the United States or that the sentence was in excess of the maximum authorized by law or is otherwise subject to collateral attack." Id.

A. Seventh Circuit Error

Fuchs first identifies at least eighteen ways-many of which are factual or procedural "mistakes"-he believes the Seventh Circuit erred in its various orders and opinions regarding his case. The court need not set out all the different bases on which Fuchs claims the Seventh Circuit erred because, quite simply, this court is not authorized to review the actions of the Seventh Circuit a § 2255 review. See Jordan v. United States, Nos. 2:12CV529-PPS, 2:09CR32-PPS, 2013 WL 6560139, at *3 (N.D. Ind. Dec. 13, 2013) ("In any event, no error by the Court of Appeals can possibly support relief from the district court on a § 2255 motion. It goes without saying that this trial court does not give appellate-type review to the actions of the Court of Appeals that sits above it."). The only entities capable of correcting or reviewing a Seventh Circuit's opinion are the Seventh Circuit itself, either in a panel rehearing or sitting en banc, or the United States Supreme Court. This court is neither.[2] Accordingly, the motion is denied as to all of the purported errors by the Seventh Circuit identified in Fuchs' motion.

B. Conflict of Interest

Fuchs next argues that appointed appellate counsel April Sellers' firm's representation of one of the victims in an unrelated proceeding was a conflict of interest. Although Fuchs does not set out how this argument would provide him grounds for relief under § 2255, the court presumes he intends to raise the alleged conflict of interest as a violation of his Sixth Amendment right to effective counsel.

"[D]efense counsel's conflict of interest can violate a defendant's Sixth Amendment right to effective assistance of counsel." Freeman v. Chandler , 645 F.3d 863, 868 (7th Cir. 2011). "There are two ways to assert a claim based on counsel's conflict of interest." Hall v. United States , 371 F.3d 969, 973 (7th Cir. 2004). "One, under Strickland, the petitioner may show that his attorney had a potential conflict of interest and that the potential conflict prejudiced his defense; or two, the petitioner may proceed under Cuyler, where he must establish a violation by showing that an actual conflict of interest adversely affected his lawyer's performance." Id . (citations and quotations marks omitted). Demonstrating an "adverse effect" is easier than showing prejudice for the purposes of Strickland, so that showing an actual conflict of interest significantly reduces the burden on the movant. See id.

The court need not determine whether Sellers had an actual conflict or a potential conflict, as Fuchs has no right to relief even under the lower standard of showing an adverse effect. "A petitioner demonstrates an adverse effect by showing that there is a reasonable likelihood that his counsel's performance would have been different had there been no conflict of interest." Id. at 974. In this case, Fuchs does not dispute Sellers' assertion in her motion to withdraw in the Seventh Circuit that she was unaware of the conflict when she wrote the briefing and presented argument to the Seventh Circuit.[3] Fuchs has not shown that Sellers' performance would have been different had no conflict existed, because, at the time of her performance, she could not have been affected by a conflict of which she was unaware. Accordingly, the motion is denied as to ground two.

C. Ineffective Assistance of Appellate Counsel

Fuchs next argues that Sellers was otherwise ineffective on a number of grounds. "Appellate counsel's performance is... measured against that of an objectively reasonable attorney." Brown v. Finnan , 598 F.3d 416, 425 (7th Cir. 2010). The court applies the familiar Strickland test, requiring a movant to show that appellate counsel's performance was (1) deficient and (2) prejudicial. See id. at 419. "An appellate counsel's performance is deficient if she fails to argue an issue that is both obvious and clearly stronger than the issues raised." Id. at 425. To show prejudice, a movant "must show that there is a reasonable probability that the issue his appellate attorney failed to raise would have altered the outcome of the appeal, had it been raised." Id.

Before addressing the arguments individually, the court notes that Fuchs has failed to develop or provide any factual support or record citation for many of his claims. Many of the arguments take the form of "And what about this? This was an error, right?" as though the brief was drafted with an eye towards simply identifying the issues and hoping the court will engage in a lengthy investigation of the record on his behalf. See United States v. Holm , 326 F.3d 872, 877 (7th Cir. 2003) ("It is not the obligation of this court to research and construct the legal arguments open to the parties...."); Greer v. Bd. of Educ. , 267 F.3d 723, 727 (7th Cir. 2001) ("[A] lawsuit is not a game of hunt the peanut.... [N]either appellate courts nor district courts are obliged in our adversary system to scour the record looking for factual disputes." (quotation marks omitted)); see also Gross v. Town of Cicero, Ill. , 619 F.3d 697, 702-03 (7th Cir. 2010). Nevertheless, the result is that every argument is undeveloped and, with conclusory assertions aside, Fuchs fails to address the prejudice prong in any of his arguments. See Holm , 326 F.3d at 877; United States v. Lewis, 39 F.Appx. 337, 340 (7th Cir. 2002) ("Lewis cannot satisfy Strickland because he does not even attempt to demonstrate prejudice from counsel's untimely filing of pretrial motions. Lewis merely asks this court to recognize the devastating consequences' of counsel's waiver of the substantive arguments in his pretrial motions, but does not explain what those consequences are. Nor does he argue that his motions would have been granted if timely, and indeed the district court made plain that it would have denied them."). With that in mind, and out of an abundance of caution, the court will briefly address each of Fuchs' main points.

1. Failure to Object to the Original 144-Month Sentence

Fuchs first argues that Sellers was ineffective for failing to object to his original 144-month sentence, which was an upward variance from the advisory guidelines range of 100-125 months, as unreasonable. This argument is based on Fuchs' misunderstanding of the way the advisory guidelines work. Although a sentence within the advisory guidelines range is presumptively reasonable, see Rita v. United States , 551 U.S. 338, 347 (2007), a sentence outside the advisory guidelines range is not presumptively unreasonable, see United States v. Abebe , 651 F.3d 653, 657 (7th Cir. 2011). Indeed, the Seventh Circuit told Fuchs as much in its adjudication of his second appeal. See Fuchs, 458 F.Appx. at 553 ("Fuchs also maintains his above-guidelines sentence was necessarily unreasonable. On the contrary, there is no presumption that a sentence outside the guidelines' range is unreasonable." (quotation marks omitted)). The fact that a modest upward variance from the advisory range was imposed does not mean that the sentence was unreasonable. Indeed, following the recalculation, this court imposed a similar modest upward variance and was ultimately affirmed by the Seventh Circuit. See id. Accordingly, a challenge to the reasonableness of the 144-month sentence was neither obvious nor strong enough that Sellers was constitutionally required to raise the issue in addition to the challenge she made to the sentence.

Indeed, even if the performance was deficient, it certainly was not prejudicial. The relief available from challenging the reasonableness of the 144-month sentence would have been a remand for resentencing. Sellers, however, succeeded in getting a remand for resentencing based on the argument challenging the imposition of § 3B1.3. Accordingly, Fuchs already received the relief that raising the reasonableness argument would have provided, and therefore the result of the appeal was not altered by the failure to raise the issue. See Brown , 598 F.3d at 425; see also Jones v. Barnes , 463 U.S. 745, 751-52 (1983) ("Neither Anders nor any other decision of this Court suggests... that the indigent defendant has a constitutional right to compel appointed counsel to press nonfrivolous points requested by the client, if counsel, as a matter of professional judgment, decides not to present those points.... Experienced advocates since time beyond memory have emphasized the importance of winnowing out weaker arguments on appeal and focusing on one central issue if possible, or at most a few key issues.").

Fuchs makes two additional arguments concerning his original sentence-that his criminal history score was wrong and that the advisory guidelines range was incorrectly calculated. However, Fuchs provides no explanation as to what error was allegedly made which could have been raised concerning either claim, so the court is unable to address whether the failure to raise these issues was deficient or prejudicial. See Holm , 326 F.3d at 877.

In his reply brief, Fuchs fleshes out his argument concerning his criminal history score. Specifically, he argues that his appellate counsel was ineffective for failing to challenge the inclusion of two prior criminal acts, one which resulted in one criminal history point and another which resulted in three points. Initially, by raising these issues only in the reply brief-and this in spite of the fact that the court granted Fuchs an opportunity to file an amended motion addressing the deficiencies in his original motion-Fuchs has waived these arguments, as the government does not receive an opportunity to respond. See White v. United States, No. 12 C 50272, 2013 WL 1499182, at *3 n.1 (N.D. Ill. Apr. 11, 2013). Even had he not waived them, Fuchs is incorrect-both prior acts and all four points were correctly included-and thus his appellate counsel was not ineffective for failing to raise either issue.

Fuchs challenges the assignment of one point to a misdemeanor charge for giving liquor to a minor. However, U.S.S.G. § 4A1.1(c) includes one point for misdemeanors (up to a total of four points) except where exempted under one of the categories in § 4A1.2(c). Providing liquor to a minor is not one of the excludable misdemeanors, [4] and thus it was correctly assigned one criminal history point and his appellate counsel was not ineffective for failing to raise this issue. Similarly, Fuchs challenges as untimely the three points assigned for a felony conviction arising from deceptive practices which resulted in twenty-one months of incarceration. His release from incarceration was more than ten years prior to his sentencing, and thus he argues it should not have been counted. However, because he was incarcerated for an aggregate of twenty-one months on the deceptive practices charge, the applicable time period was not ten years as Fuchs argues but, rather, fifteen years, § 4A1.2(e)(1). He was released from incarceration on April 5, 1994 and commenced the instant offense conduct on December 20, 2002, less than ten years later. Thus the assignment of three points to the prior sentence was clearly appropriate. Therefore, his appellate counsel was not ineffective for failing to raise that issue, either.

2. Jury Issues

Fuchs next complains that Sellers was ineffective for failing to raise two issues concerning the jury pool, namely that (1) the government struck the only black juror from the jury pool by use of a peremptory challenge and (2) the selected jury was not a jury of his peers because they had "law enforcement background" and lacked any knowledge of mortgage brokerage or the industry in general.

As to the first jury-based challenge, Fuchs has not pointed to any portion of the record wherein a black juror was struck based on a peremptory challenge. Additionally, the court's independent review of the transcript of jury selection has not revealed the mention of any black juror who was struck by the government. Appellate counsel cannot be ineffective for failing to raise an issue with no basis in the record. See Brown , 598 F.3d at 425 (noting that appellate counsel is only deficient for failure to raise "obvious" issues).

As to the second, the Supreme Court has long held that the Sixth Amendment right to a jury trial does not guarantee a jury with any particular knowledge or one that is representative of a defendant's interests in general. See Holland v. Ill. , 493 U.S. 474, 480 (1990) ("The Sixth Amendment requirement of a fair cross section on the venire is a means of assuring, not a representative jury (which the Constitution does not demand), but an impartial one (which it does)."); id. at 483 ("Defendants are not entitled to a jury of any particular composition."). Thus, the fact that the jurors lacked mortgage experience is irrelevant. Other than a conclusory allegation that the jurors had a law enforcement background, Fuchs has not pointed to any particular juror whose experience was problematic. "Moreover, nothing prevents jurors who have characteristics about which Petitioner complains from service on juries." Thomas v. Rednour, No. 11 C 4927, 2013 WL 2251734, at *12 (N.D. Ill. May 22, 2013). Each juror was subject to an extensive voir dire, and each agreed that they could judge the case impartially. Fuchs has pointed to nothing in the record which would have made it obvious to his appellate counsel that a worthy argument existed to object to his trial on this basis.

3. Circuit Rule 36

Fuchs next argues that his appellate counsel was ineffective for failing to ask the Seventh Circuit to reassign his case on remand to a different judge on account of Circuit Rule 36. Circuit Rule 36 states:

Whenever a case tried in a district court is remanded by this court for a new trial, it shall be reassigned by the district court for trial before a judge other than the judge who heard the prior trial unless the remand order directs or all parties request that the same judge retry the case. In appeals which are not subject to this rule by its terms, this court may nevertheless direct in its opinion or order that this rule shall apply on remand.

7th Cir. R. 36. By its terms, the rule does not apply automatically-the case was not remanded for a new trial, but for resentencing. Of course, the last sentence reserves the right to order the case reassigned following any appeal, but the Seventh Circuit typically only does so where the original sentencing judge has engaged in "inflammatory, provocative, or disparaging" behavior or demonstrated that he "would be unable to follow [the Seventh Circuit's] instructions on remand." United States v. Tovar-Pina , 713 F.3d 1143, 1148 (7th Cir. 2013). Fuchs has not identified anything in the record from which his appellate counsel could have argued either inflammatory behavior or the inability to follow instructions on ...


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