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The People v. Leonard Reubin Milstein

December 12, 2012

THE PEOPLE, PLAINTIFF AND RESPONDENT,
v.
LEONARD REUBIN MILSTEIN, DEFENDANT AND APPELLANT.



APPEAL from a judgment of the Superior Court of Los Angeles County. William C. Ryan, Judge. (Los Angeles County Super. Ct. No. BA305106)

The opinion of the court was delivered by: Zelon, J.

CERTIFIED FOR PUBLICATION

Reversed.

Appellant Leonard Milstein appeals his conviction following a plea of no contest to one count of conspiracy to defraud by false pretenses or false promises in violation of Penal Code section 182, subdivision (a)(4).*fn1 The sole issue on appeal is whether a violation of section 182, subdivision (a)(4) is subject to the three-year statute of limitations in section 801 for criminal conspiracies in general or to the four-year statute of limitations in sections 801.5 and 803, subdivision (c) for felony offenses which have fraud as a material element of the crime. We conclude that the three-year statute of limitations applies to the charged offense of conspiracy to defraud by false pretenses or false promises. Because it is undisputed that the prosecution of the offense was not commenced within three years of the last overt act in furtherance of the conspiracy, it was time-barred. Milstein's conspiracy conviction must therefore be reversed.

FACTUAL BACKGROUND AND PROCEDURAL HISTORY

I. Factual Background

This criminal action arose from an alleged fraudulent scheme in which a magazine called American Justice was distributed free to jails and prisons in Southern California. Brent Carruth, a disbarred attorney, was the publisher of the magazine. Milstein, then a member of the State Bar of California ("State Bar"), advertised a legal service entitled "early release" in the magazine. The scheme was allegedly fraudulent because, except for a few limited statutory means, inmates were not eligible for early release as advertised by Milstein. After inmates who hired Milstein served their full sentences without any work being performed on their cases, they complained to the State Bar. The State Bar investigated the inmates' claims, and in February 2002, referred the matter to the Los Angeles County District Attorney.

II. Procedural History*fn2

On July 6, 2006, the District Attorney filed a two-count complaint against Milstein and Carruth*fn3 charging them with conspiracy to defraud by false pretenses or false promises in violation of section 182, subdivision (a)(4), and conspiracy to engage in unlawful capping in violation of section 182, subdivision (a)(1). In a series of subsequent amendments to the complaint, the District Attorney omitted the count for conspiracy to engage in unlawful capping and added five counts for grand theft of personal property in violation of section 487, subdivision (a). The District Attorney also added a tolling allegation stating that the violations described in all six counts were not discovered until January 27, 2004, because documents identifying the nature and amount of loss were in the sole possession of the State Bar prior to that date. Concurrent with a preliminary hearing, Milstein and Carruth brought a motion to dismiss each count in the complaint as time-barred under the statute of limitations. The motion was denied by the magistrate judge and both Milstein and Carruth were held to answer on all six counts.

An information charging Milstein and Carruth with the same six counts was filed on February 15, 2008, and subsequently amended. In the operative second amended information filed on December 8, 2008, the District Attorney charged Milstein and Carruth with one count of conspiracy to defraud by false pretenses or false promises in violation of section 182, subdivision (a)(4) (count 1) and five counts of grand theft of personal property in violation of section 487, subdivision (a) (counts 3 through 7).*fn4 As to the conspiracy count, it was alleged that the conspiracy was committed over a period of time from August 3, 2000 to July 26, 2002, and that the last overt act in furtherance of the conspiracy occurred on July 26, 2002. As to the grand theft counts, it was alleged that the thefts were committed over a period of time with the following end dates for each count: April 30, 2002 (counts 3 and 6), November 30, 2001 (count 4), May 31, 2001 (count 5), and July 22, 2002 (count 7). As to all six counts, it was also alleged that the District Attorney did not discover the violations until on or about January 27, 2004, because documents identifying the victims and the nature and amount of their losses were in the sole possession of either the defendants or the State Bar prior to that date.

Milstein and Carruth thereafter brought a motion to dismiss each count in the second amended information as time-barred under the statute of limitations. The trial court denied the motion to dismiss as to the conspiracy count (count 1) and one of the grand theft counts (count 7), but granted the motion as to the remaining four grand theft counts (counts 3 through 6). In its written decision, the trial court concluded that all six counts were subject to the four-year statute of limitations in sections 801.5 and 803, subdivision (c). As to the grand theft counts, the court determined that, with the exception of count 7, each of the alleged thefts was completed by the defendants and discovered by the District Attorney more than four years before the filing of the original complaint on July 6, 2006, and was therefore time-barred. As to the conspiracy count, the court noted that, although the statute of limitations for most conspiracies was three years, "[t]he Legislature . . . appears to have carved out an exception in section 801.5 for all crimes, including conspiracy, that involve fraud. . . ." The court thus reasoned that "any conspiracy that has as its object fraud, as here, is subject to a four year statute of limitations rather than the three year[ ] statute that would apply to all other conspiracies." Because the last overt act in furtherance of the conspiracy was alleged to have occurred on July 26, 2002, less than four years before the filing of the original complaint on July 6, 2006, the court concluded that the conspiracy count was timely charged.

On May 17, 2011, Milstein pleaded no contest to the conspiracy count and the trial court found him guilty of that charge. Imposition of the sentence on the conspiracy count was suspended and Milstein was placed on probation subject to specific terms and conditions. Counts 3 through 7 were dismissed by the trial court in its written order pursuant to section 1385. On June 2, 2011, the trial court granted Milstein's request for a certificate of probable cause and Milstein filed a timely notice of appeal.

DISCUSSION

On appeal, Milstein argues that the judgment of conviction must be reversed because the count of conspiracy to defraud by false pretenses or false promises (§ 182, subd. (a)(4)) was barred by the statute of limitations. For purposes of this appeal, the parties agree that the last overt act in furtherance of the conspiracy was alleged to have occurred on July 26, 2002, and that the prosecution was commenced less than four years later on July 6, 2006.*fn5 Accordingly, the sole issue on appeal is whether the statute of limitations on the conspiracy to defraud count was three years under section 801, as Milstein contends, or four years under sections 801.5 and 803, subdivision (c), as the Attorney General contends. As set forth below, we ...


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