U.S.A v. Miell

711 F.Supp.2d 967

UNITED STATES of America, Plaintiff,v.Robert MIELL, Defendant.

No. CR07-101-MWB.

United States District Court,

N.D. Iowa,

Cedar Rapids Division.

May 10, 2010.

COPYRIGHT MATERIAL OMITTED

Charles J. Williams, U.S. Attorney's Office, Cedar Rapids, IA, for Plaintiff.

MEMORANDUM OPINION AND ORDER REGARDING DEFENDANT'S MOTION TO WITHDRAW GUILTY PLEAS

MARK W. BENNETT, District Judge.

The court is called upon here to consider whether there is any merit to the defendant's contention that he should be allowed to withdraw his guilty pleas to charges of mail fraud and perjury on the grounds that his guilty pleas were invalid because the court failed to advise him of the maximum possible sentence, its authority to order restitution, and were the product of ineffective assistance of counsel.

I. INTRODUCTION

A. Factual Background

This criminal case has its origins in a federal civil case between defendant Robert Miell and his former insurer, American Family Mutual Insurance Company (“American Family”). On October 20, 2004, American Family filed a complaint, in this court, seeking compensatory and punitive damages from defendant Miell for inter alia, fraudulent misrepresentations and breach of contract. See Complaint American Family Mut. Ins. Co. v. Miell, C04-0142-JSS (docket no. 2). American Family asserted that Miell had schemed to defraud American Family of payments for repairs of hail damage to the roofs of over one hundred rental properties owned by defendant Miell, based on allegations that, contrary to Miell's representations to obtain such payments, the roofs had not already been repaired. Before this civil case could come to trial, defendant Miell was indicted in this court on November 28, 2007, and charged with nineteen counts of mail fraud, in violation of 18 U.S.C. § 1341. The first six counts of the Indictment centered on Miell's scheme to defraud American Family by making fraudulent insurance claims for insurance payments on his hail-damaged rental properties. Indictment United States v. Miell, CR07-101-MWB (docket no. 1).

The jury trial in the civil case began on January 7, 2008. Following six-days of trial, the jury returned a verdict in American Family's favor, awarding it compensatory damages of $547,764.44 as a result of Miell's breach of contract, $339,100.78 on its claim of fraudulent misrepresentation and punitive damages of $1,017,332.30. See Verdict Form American Family Mut. Ins. Co., C04-0142-JSS (docket no. 147). On January 31, 2008, judgment was entered accordingly. On February 14, 2008, defendant Miell filed a Motion For Judgment As A Matter of Law And/Or To Alter Or Amend The Judgment. See Motion For Judgment As A Matter Of Law And/Or To Alter Or Amend The Judgment American Family Mut. Ins. Co., C04-0142-JSS (docket no. 165). On March 4, 2008, American Family filed a timely resistance to defendant Miell's motion. In its brief, in discussing the appropriateness of the jury's punitive damage award, American Family pointed to the possible criminal penalties for Miell's fraudulent actions, including the possibility that the criminal sentences could be ran consecutively:

So, counting only the 145 claims at the core of this lawsuit, it appears that Nau mailed sixty different envelopes carrying replacement cost checks to Miell. Those mailings of replacement cost checks were an integral part of Miell's fraudulent scheme-in fact, those mailings were the goal of the scheme. Therefore, Miell could be subject to up to sixty charges under 18 U.S.C. section 1341.

For each of those sixty charges, Miell could be imprisoned up to “20 years,” for a total possible prison sentence of 1200 years. 18 U.S.C. § 1341. In addition, for each of those sixty charges, Miell could be fined. See id. Arguably, those fines could be as high as $250,000 for each of he sixty mail fraud counts see 18 U.S.C. § 3571(b)(3), for a total federal fine of $15,000,000.

Summarizing, as a result of his insurance fraud scheme against American Family, Miell could be subject to 1200 years in federal prison ... added to the enormous potential federal liability of $15,000,000 ...

American Family Br. at 40-41, American Family Mut. Ins. Co., C04-0142-JSS (docket no. 182); Gov't Ex. 1, United States v. Miell, CR07-101-MWB (docket no. 219-1). Defendant Miell's attorney in the civil lawsuit, Web Wassmer, mailed Miell a copy of American Family's brief on March 14, 2008. Wassmer subsequently discussed this brief with Miell.

Beginning in February 2008, attorney Monty Brown provided defendant Miell with criminal representation in this case. Brown acted as Miell's lead criminal attorney. In April 2008, attorney William Kutmus also undertook to represent Miell in this case. In his role as lead defense counsel, Brown reviewed the prosecution's discovery file on numerous occasions and sent Kutmus summaries of his work and investigation on the case and met with Kutmus to evaluate possible strategies and arguments.

Brown had only limited discussions with Miell about pleading guilty until late spring or early summer of 2008. In the summer of 2008, Brown and Miell discussed the pros and cons of pleading guilty and Brown had his first conversations with Miell about the possible penalties he faced. During his discussions with Miell, Brown specifically discussed the fact that each conviction on the mail fraud charges carried a maximum penalty of 20 years imprisonment and each conviction on the perjury charges carried a possible maximum sentence of five years imprisonment. Brown also discussed with Miell the possibility of consecutive sentences, advising Miell that he thought the likelihood of that occurring was “highly unlikely.” Moreover, Brown discussed the topic of restitution with Miell. From these conversations, Miell was aware that the prosecution's expert had estimated the potential restitution in his case at approximately $1,200,000.

In July 2008, Brown “crunched the guidelines” to determine what the possible guideline sentence would be for Miell. From his calculations, Brown concluded that, at worst, Miell would be assessed at an offense level of 29. Following this determination, Miell authorized Kutmus to begin negotiations on a possible plea agreement. On August 19, 2008, Brown faxed to Miell a copy of a proposed written plea agreement he had received from the prosecution. The proposed plea agreement included the following provision regarding the possible penalties Miell faced for each of the mail fraud counts:

A. _____ The defendant understands Counts 1 and 7 of the Superseding Indictment (the mail fraud counts) are each punishable by up to 20 years' imprisonment without the possibility of parole; a fine of up to $250,000 or twice the gross gain or loss (whichever is greater); and a mandatory special assessment of $100; and a term of supervised release of up to three years. ...

2. _____ The defendant understands that restitution and a term of supervised release following incarceration may be imposed in addition to any other sentence.

Proposed Plea Agreement at ¶¶ 1(A), 2; Gov't Ex. 2, United States v. Miell, CR07-101-MWB (docket no. 230-1). The proposed plea agreement also included the following provisions regarding victim restitution:

10. _____ The defendant agrees to pay full restitution to all identifiable victims of the fraud schemes to which he is pleading guilty. The defendant further understands that the amount of loss sustained by each victim will be determined during the course preparation of the presentence investigation report. The defendant agrees to cooperate in the investigation of the amount of loss and the identification of victims. The defendant understands that full restitution will be ordered regardless of the defendant's financial resources. The defendant agrees that any restitution imposed will be non-dischargeable by any bankruptcy proceeding and he will not seek a discharge or a finding of dischargeability as to the restitution obligation. The defendant agrees to make restitution to all victims of the mail fraud schemes to which he has pled guilty and his obligation to make restitution is not limited to the specific counts of conviction reflecting individual mailings made in relation to the underlying fraudulent schemes.

11. _____ In furtherance of defendant's obligation to cooperate in compensating victims of his crimes, with respect to the mail fraud scheme involving insurance payments, the defendant will, no later than the time of sentencing, pay to American Family Insurance Company $336,541.26, representing the amount of RCV payments defendant wrongly received.

Proposed Plea Agreement at ¶¶ 10-11; Gov't Ex. 2.

After consulting with counsel, defendant Miell rejected the prosecution's proposed plea agreement. After Miell rejected the proposed plea agreement, Brown continued in his efforts at trial preparation. During the course of his representation of Miell, Brown spent between 75 and 150 hours preparing for trial. Defendant Miell provided Brown with several lists of potential witnesses. Brown, along with a private investigator, Jim McDonald, conducted interviews of these potential witnesses. Based on Brown's knowledge and experience, as well as information gained from his and McDonald's interviews of possible witnesses, Brown rejected some of Miell's proposed witnesses. Brown, ultimately, identified between eight and twelve witnesses for trial. Brown had subpoenas prepared for these witnesses but did not have them served. Brown had several reasons for not serving the subpoenas immediately. First, several of the witnesses were Miell's employees who were willing to testify on his behalf and he did not anticipate having any trouble serving them. Second, Brown anticipated the trial lasting between ten and fifteen days and wanted to see how fast the trial was proceeding before deciding when to subpoena his witnesses. Finally, he anticipated that some of the witnesses he intended to call would be...