The opinion of the court was delivered by: George H. WU United States District Judge
Pro se Petitioner, a prisoner in the custody of the California Department of Corrections, challenges a conviction in California Superior Court, Sacramento County (Case No. 02F09957).
On March 12, 2004, a jury found Petitioner guilty of one count of operating an endless chain scheme in violation of California Penal Code Â§ 327. On August 26, 2004, the court ordered the imposition of judgment and sentence stayed, and placed Petitioner on five years probation.
On direct review, Petitioner asserted four claims, including the two due process claims she asserts on federal habeas corpus review. The California Court of Appeal affirmed Petitioner's conviction and sentence in an opinion dated August 23, 2006. Petitioner filed a Petition for Review in the California Supreme Court, asserting only the two claims she asserts here. That court summarily denied review on November 1, 2006.
Petitioner filed the present Petition for Writ of Habeas Corpus ("Pet.") on January 4, 2008. Respondent filed an Answer and Memorandum of Points and Authorities ("Resp. P&A") on March 5, 2008. On March 16, 2008, Petitioner filed her Reply.
The following factual summary derives from the opinion of the California Court of Appeal.
WHW [Women Helping Women] called itself a "gifting club." Participation was limited to women. The WHW terminology, like the name "Women Helping Women," has a homey, domestic theme. WHW purported to be "a group of women devoted to helping and supporting one another."
A typical WHW attestation tugs the charitable heartstrings: "I first heard about WHW from my sister who is a manicurist in Shingle Springs. She told me about this gifting club that was for women only, and the intent of the club was to help women like ourselves. Women who have big bills to pay, who have faced cancer [and] have hospital bills, who are raising children on their own, who have family members in need or kids to put through college, women who have [gone] through bankruptcy, who are getting divorced, who have attorney bills or are just plain struggling."
The core of the WHW scheme is as follows: Entering participants make a cash "gift" for the purpose of receiving eight times their initial investment. The entering participants' subscriptions fill eight positions of $5,000 each at the first level of the scheme. These positions were called "appetizer plates." Participants could subscribe for the whole $5,000 plate and receive $40,000 at payout or they could subscribe for a portion of a plate, e.g., one-quarter for $1,250 resulting in a $10,000 payout. Each plate was divided into eighths, worth $625 a piece.
If the following second generation of recruits' subscriptions fill in 16 appetizer plates, the entire first generation advances through the second level of the scheme. The second level positions were called "soup and salad plates."
If the following third generation of recruits' subscriptions fill in 32 appetizer plates, the entire first generation advances through the third level of the scheme and the entire second generation through the second level. The third level positions were called "entree plates."
If the following fourth generation of recruits' subscriptions fill in 64 appetizer plates, the entire first generation advances through the fourth level of the scheme ("desert plates") and receives the eightfold $40,000 payout, a so-called "birthday," from those subscriptions. The second and third generations also move up a level.
As each subset generation of eight appetizer plates ascended a level they were divided into two fiscally separate groups. Thus, if recruitment goes well, after three generations, each is at the apex of a subordinate pyramid, or in WHW lingo a "chart," of two entrees, four soup and salads, and eight paying appetizers.
As a result of this division, the charts are free to proceed independently, at different rates. Some chart branches with successful recruiters proliferate rapidly, while others could take longer to generate payouts, if at all. [Petitioner] did not feel sorry for charts that were progressing slowly, as "they weren't working hard enough."
Under WHW's guidelines personal recruitment of new participants was not a "mandatory" requirement to reach the payout apex of the pyramid. However, personal recruitment of three additional participants per chart was explicitly urged as a duty of all. For example, the guidelines provide that if those a participant bring in do not recruit their share, they "need to take that responsibility and work to bring their [three] ladies in for them." If a participant fulfills her duty to recruit three others then, after her "birthday" payout, she was permitted to rejoin, to ascend another derivative chart toward another payout.
WHW became a sizeable enterprise. It claimed to have 10,000 participants from Auburn to Bakersfield and to have paid out over $11 million. WHW's administration was provided by the participants.
Potential recruits, sometimes as many as 100 at a time, were given a sales pitch at a WHW social event by a "presenter." The presenter was required to understand the WHW program and to explain it to potential recruits. WHW provided a detailed script for the presenter's pitch. The presenter was also responsible for dealing with "uninvited guests (District Attorney, Police, troublemakers, etc.)[.]"
The key event of the WHW organization was the "birthday party," where the cash subscriptions for appetizer plate status were paid to the dessert plate participant(s) at the apex. A WHW "officiator" was in charge of the entire event, seeing to organization of the room, security, calling upon the appetizer plate women to make their payments, responding to problems, and turning in reporting documents to WHW.
The "counter" had the role of counting the payments for the officiator and paying them over to the birthday girls. The counter was also responsible for signing and dating the receipt sheets.
"Hostesses' provided their home or a business facility for use for a meeting. They would provide WHW literature and snacks and soft drinks.
A "chart leader" was the participant on a WHW chart who documented the activity of the chart. Chart leaders would communicate with chart participants weekly, encouraging them and inviting them to WHW dinner parties. They taught other ...