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United States v. Diaz

August 31, 2010



Defendants Larry Sixto Amaro, Gerardo Lopez Mora, Ernest Paul Killinger, Jason Michael Stewart Hanson, Bismark Martin Ocampo, Benjamin Santos Castro, Marco Anthony Gomez, Edward Fuentes, Richard Mendoza, David Perez Ramirez, Faustino Gonzales, Oscar Campos Padilla, Valdemar Salazar Cambunga, and Gabriel Carracheo filed this motion to suppress wiretap-intercepted calls and for a Franks*fn1 evidentiary hearing on the motion. Defendants argue that the three affidavits in support of the three motions for a wiretap are facially deficient because they fail to establish "necessity" and that the affidavits contain intentional or reckless material misstatements and omissions. Defendants also argue that the government's authorization to monitor the third target phone ended when the government told the court in its first periodic report that it planned to disable monitoring of the phone because it was believed that Diaz would shortly dump the phone. Defendants further argue that all evidence obtained pursuant to the three wiretap orders must be suppressed because the task force failed to abide by the court's minimization orders, and allege that the redacted portions of the Holladay affidavits related to the multi-state OCDETF investigation linked to the Diaz drug trafficking organization ("DTO") should be disclosed.

A. Facially Deficient Affidavits Title III of the Omnibus Crime Control and Safe Streets

Act of 1968, 18 U.S.C. §§ 2510-2520, allows law enforcement agencies to conduct electronic surveillance of suspected criminal activities. "This authority is not a blank check; aside from demonstrating probable cause, see 18 U.S.C. § 2518(3)(a), 'the government must prove necessity' before it resorts to a wiretap." United States v. Garcia-Villalba, 585 F.3d 1223 (9th Cir. 2009) (quoting United States v. Gonzalez, Inc., 412 F.3d 1102, 1110 (9th Cir. 2005)); see 18 U.S.C. § 2518(1)(c) (stating that an application for a wiretap must include "a full and complete statement as to whether or not other investigative procedures have been tried and failed or why they reasonably appear to be unlikely to succeed if tried or to be too dangerous"). The necessity requirement "can be satisfied by a showing in the application that ordinary investigative procedures, employed in good faith, would likely be ineffective in the particular case." United States v. McGuire, 307 F.3d 1192, 1196 (9th Cir. 2002) (citing United States v. Brone, 792 F.2d 1504, 1506 (9th Cir. 1986)). "The necessity for the wiretap is evaluated in light of the government's need not merely to collect some evidence, but to develop an effective case against those involved in the conspiracy." United States v. Decoud, 456 F.3d 996, 1007 (9th Cir. 2006). "An 'effective case' means 'evidence of guilt beyond a reasonable doubt, not merely evidence sufficient to secure an indictment.'" Garcia-Villalba, 585 F.3d at 1228 (quoting McGuire, 307 F.3d at 1198) (internal quotation marks in McGuire omitted).

Defendants argue that the three affidavits presented in support of the three wiretap applications are facially deficient in that they fail to establish the required "necessity." According to defendants, the government's stated investigative goal of dismantling the Diaz DTO and arresting all its participants and conspirators was so broad as to be impossible to accomplish and as to justify the indefinite use of wiretaps. There is no foundation for the argument---and indeed defendants present none--that large criminal organizations are immune from wiretap surveillance simply because their size makes them difficult to dismantle. See, e.g., United States v. Shryock, 342 F.3d 948, 975-76 (9th Cir. 2003) (denying motion to suppress wiretap in investigation targeting the Mexican Mafia, a group with "several hundred members and an unknown number of associates"). Furthermore, the 99-page affidavit in support of the first wiretap by Special Ageng Scott Holladay ("First Holladay Aff.") stated that the present investigation was focused on the Diaz DTO---a criminal organization operating under the umbrella of the Nuestra Familia gang. While the Diaz DTO may have had many members, conspirators, and associates, the First Holladay Affidavit stated that there already was probable cause Diaz and nine other individuals were committing the subject offenses---further contradicting defendants' argument that dismantling it was an "impossible goal."

Defendants also argue that the first wiretap should not have been issued because the First Holladay Affidavit showed that ordinary investigative procedures would have likely been successful. Specifically, Nuestra Familia gang member and informant "CW-1" had previously been successful in completing two controlled methamphetamine buys and in providing the government with incriminating evidence regarding the Diaz DTO, informant "CW-2" had been successfully used in a 120-pound methamphetamine seizure, and the government was in contact with another potential informant called "ATF source." Courts have repeatedly authorized wiretaps when the government has used or was using informants and undercover agents. See McGuire, 307 F.3d 1192, 1199 (upholding a necessity finding where "[i]nfiltration alone could not determine the scope of" the conspiracy and where "[s]tandard law enforcement techniques alone could not effectively crack the conspiracy, exposing its illicit aims and acts"); Brone, 792 F.2d 1504 (upholding a necessity finding in a case with five confidential informants and an undercover agent); see also United States v. Canales Gomez, 358 F.3d 1221, 1225 (9th Cir. 2004) ("[T]he mere attainment of some degree of success during law enforcement's use of traditional investigative methods does not alone serve to extinguish the need for a wiretap.") (quoting United States v. Bennett, 219 F.3d 1117, 1122 (9th Cir. 2000) (internal quotation marks omitted, substitution in Canales Gomez). The Holladay affidavit explained that additional controlled buys by CW-1 would be prohibitively expensive and that in any event CW-1 could not discover Diaz's drug sources, the ultimate destination of Diaz's drug money, or Diaz's money laundering activities. (First Holladay Aff. at 79, 83-86.) Likewise, CW-2 was a lower-level Nuestra Familia member such that CW-2 could only provide limited information regarding the Diaz DTO. Contrary to defendants' assertions, the First Holladay Affidavit also explained that ATF source would not be an appropriate informant because he*fn2 was currently in custody and was an illegal immigrant subject to deportation at the completion of his sentence. (Id. at 90-91.)

Defendants also argue that the government could have used pen register data obtained from Diaz's phone and phone records to identify other conspirators, build their case, and avoid the need for a wiretap. According to defendants, the First Holladay Affidavit provides nothing more than boilerplate reasons why traditional investigative techniques were not sufficient. "A full and complete statement of necessity must specify why, in the particular case at hand, the[] inherent limitations [of traditional techniques] will be insufficient." United States v. Blackmon, 273 F.3d 1204, 1209 (9th Cir. 2001). While defendants are correct that analyzing Diaz's phone records may have led the government to be able to identify other members of the Diaz DTO and its conspirators, the wiretap standard is viewed in light of the government's need to obtain evidence of guilt beyond a reasonable doubt, Garcia-Villalba, 585 F.3d at 1228, and "law enforcement officials need not exhaust every conceivable alternative before obtaining a wiretap." McGuire, 307 F.3d at 1196-97. The First Holladay Affidavit provides ample case-specific detail as to why these and other traditional investigative methods could not have provided the government with the kind of evidence necessary to obtain a conviction. (See First Holladay Aff. at 89-95). The government has therefore met its burden in showing the necessity for the first wiretap.

Defendants also argue that the second wiretap should not have been issued because the supporting Holladay affidavits showed that the first wiretap had been successful in identifying some members of the Diaz DTO conspiracy and in obtaining incriminating evidence. In the 48-page Holladay Affidavit accompanying the second application for a wiretap ("Second Holladay Aff."), Holladay stated that the government now had probable cause that eighteen individuals were engaged in the subject offenses and had identified two of Diaz's drug suppliers. (Second Holladay Aff. at 5.) According to defendants, this success meant that further wiretap surveillance was no longer necessary. The goal of the investigation, however, was to dismantle the entire Diaz DTO and its conspirators. And as explained above, necessity is determined by the government's need to obtain evidence of guilt beyond a reasonable doubt. See Garcia-Villalba, 585 F.3d at 1228. The Second Holladay Affidavit stated that there were additional conspirators and drug suppliers to the Diaz DTO that remained to be identified. (Id. at 28.) While the first wiretap may have aided the investigation, its partial success does not negate the necessity for additional wiretap surveillance. See Canales Gomez, 358 F.3d at 1225.

Defendants also argue that the government could have used a new source identified as "ATF-2" as an informant rather than seeking further wiretap surveillance. Yet ATF-2 was then in custody pending state charges so he could not have been used at that time as an informant. (Second Holladay Aff. at 38.) Even if he could have been used, there was no evidence that he could have uncovered all of Diaz's suppliers of narcotics or any of his money laundering operations. See McGuire, 307 F.3d at 1196-99. Finally, defendants make the conclusory argument that the Second Holladay Affidavit discounts the potential success of traditional investigative techniques in boilerplate language. Viewing the affidavit as a whole, it adequately provides case-specific information regarding the past shortfalls and predicted likelihood of low success of traditional investigative techniques. (See Second Holladay Aff. at 29-44.)

Defendants challenge the third wiretap on the same grounds. For the reasons previously discussed, the court finds sthe affidavit in support of the third wiretap application sufficient.

B. Material Misstatements and Omissions

The Fourth Amendment requires an evidentiary hearing at a defendant's request "where the defendant makes a substantial preliminary showing that a false statement knowingly and intentionally, or with reckless disregard for the truth, was included by the affiant in the warrant affidavit, and if the allegedly false statement is necessary to the finding of probable cause." Franks, 438 U.S. at 155-56. Defendants request such a hearing for seven types of material misstatements and omissions in the Holladay affidavits. First, argue that the Holladay affidavits misled the court about CW-1's criminal history because it did not detail every item on his rap sheet. The First Holladay Affidavit informed the court that, among other things, CW-1 "has suffered felony convictions for willfully discharging a firearm in a negligent manner and being a felon in possession of a firearm. (First Holladay Aff. at 25.) While the affidavit did not inform the court of a 1993 misdemeanor for obstructing a peace officer, a second conviction for a felon in possession of a firearm, or a 2007 DUI arrest and subsequent plea to reckless driving, the court was well aware that CW-1 was a convicted felon "involving various crimes of violence and drug-related offenses" and member of the Nuestra Familia gang. (First Holladay Aff. at 25.) These omissions, therefore, were not material and did not mislead the court as to CW-1's reliability as an informant.

Second, defendants argue that the First Holladay Affidavit misled the court in suggesting a connection between the Diaz DTO and the Sarabia seizure of 120 pounds of methamphetamine. The affidavit outlines the Sarabia seizure, CW- 2's role in it, and states that unrecorded telephone conversations between Diaz and CW-1 after Sarabia's arrest that "may indicate a connection between the DIAZ DTO and SARABIA'S large-scale drug operation." (First Holladay Aff. at 56-58.) The affidavit makes clear that "[i]t is not clear what link, if any, the DIAZ DTO has to the SARABIA'S large-scale drug trafficking." (Id. at 59.) The court was therefore not misled as to any potential link between the Diaz DTO and the Sarabia drug seizure.

The affidavit also outlines an unrecorded telephone call between CW-1 and Diaz that Holladay believed was regarding the Sarabia arrest and seizure. (Id. at 58-59.) Defendants argue that this phone call never happened, that Holladay's statements regarding the call are false, and that there was no evidence of any link between the Diaz DTO and Sarabia's drug trafficking operation. Even if the Holladay affidavit were purged of these statements, the 99-page affidavit still amply supports a finding of probable cause and necessity for the wiretap. See United States v. Meling, 47 F.3d 1546, 1554 (9th Cir. 1995) ("[I]f, when material that is subject of the alleged falsity or reckless disregard is set to one side, there remains sufficient content in the warrant affidavit to support a finding of probable cause, no hearing is required.") (quoting Franks, 438 U.S. at 171-72) (internal quotation marks omitted, substitution in Meling). Because the court was not misled that any connection between Sarabia and the Diaz DTO was speculative, the wiretap did not rely on any supposed connection between the two criminal operations.

Third, defendants argue that the First Holladay Affidavit misled the court by failing to include a summary of a March 6, 2007 telephone call between CW-1 and Diaz in which CW-1 arranged to purchase two pounds of methamphetamine from Diaz, and the Task Force's subsequent canceling of the order for lack of funds. The affidavit made clear that additional controlled buys by CW-1 would not uncover Diaz's suppliers or the origin and method of Diaz's money laundering scheme. The court has already explained why this showing satisfies the necessity ...

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