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United States v. McCall

United States District Court, N.D. California

June 9, 2014

CHARLES W. McCALL, Defendant.


WILLIAM ALSUP, District Judge.


Defendant moves to vacate, set aside, or correct his sentence pursuant to Section 2255 on the ground that his trial counsel was constitutionally ineffective. He also requests an evidentiary hearing and to be released on bail pending the resolution of his Section 2255 motion. For the reasons stated below, defendant's Section 2255 motion is DENIED. His requests for an evidentiary hearing and release on bail are DENIED.


The parties agree about the key material facts underlying this motion. Defendant Charles McCall was the chief executive officer of HBOC beginning in January 1991. After the merger of HBOC and McKesson Corporation in 1999, he became chairman of the board of directors of the combined company, McKessonHBOC. On June 3, 2003, defendant was indicted and charged with various counts involving securities fraud. Although defendant was terminated as chairman of the board of directors, McKesson nevertheless committed to paying legal expenses associated with his defense. Defendant retained the law firm of Paul, Weiss, Rifkind, Wharton & Garrison LLP to represent him, led by attorney Theodore Wells as chief counsel. Paul Weiss also associated with attorney Michael Shepard of Heller Ehrman White & McAuliffe LLP, which later and before its demise became Heller Ehrman LLP, an attorney based in San Francisco, in as much as the action was brought in the Northern District of California.

At his arraignment on June 5, 2003, defendant was advised of the maximum applicable statutory penalties based on the charges against him. In particular, he was told (Reeves Decl., Exh. A, at 4-5):

And again, the maximum penalty for [Count one] is five years imprisonment; a fine of $250, 000; three years of supervised release; $100 special assessment.
For the remaining counts... the maximum penalties are ten years of imprisonment; a $1 million fine; three years of supervised release; and a $100 special assessment.

His first jury trial commenced on September 18, 2006, before Judge Martin Jenkins. On November 3, 2006, defendant was acquitted of one count, and the jury was unable to reach a verdict as to the remaining counts of the indictment. As a result, Judge Jenkins declared a mistrial as to the remaining counts (Dkt. No. 719; Dkt. No. 1149, Br. at 9-12). This action was reassigned to the undersigned judge on April 7, 2008, when Judge Jenkins was appointed to the California Court of Appeal (Dkt. No. 748). At all material times, defendant was free on bond.

Attorney Shepard met with government counsel on June 3, 2009, to discuss issues relating to the second trial. In a subsequent email to defense co-counsel summarizing the discussion, Attorney Shepard stated that he believed that the government "[seems] amenable, perhaps even eager, for a resolution of some sort, provided it's a felony plea tied to the guidelines." He was unsure, however, whether defendant "would accept a deal that exposes him to any jail time..." (Osterhoudt Decl., Exh. 21). On June 26, 2009, Attorney Shepard met with government counsel again to discuss plea possibilities (Osterhoudt Decl., Exh. 34, at 2). In an email to defense co-counsel, Shepard stated that the government would only consider a "[Rule 11(c)(1)(C) plea agreement] but would tie it down to participation in a select list of transactions [which were not identified]... [and would subject defendant to] a much wider range [of sentencing]" (Osterhoudt Supp. Decl., Exh. 36).

Following the June 26 meeting, defendant alleges that Attorney Shepard informed him that "the prosecutors were willing to settle [his] case on terms similar to the plea dispositions they had extended to individuals involved in the charges against [him]" and that he should "consider it." At that time, defendant was aware that both individuals were sentenced to prison for two to four years (McCall Decl. ¶ 7). He informed Attorney Shepard that he would reject such a proposal because he "did not want to go to jail" (McCall Decl. ¶ 9).

Defendant's second trial commenced on October 27, 2009, before the undersigned judge (Dkt. No. 930). On November 19, 2009, defendant was convicted of four counts of securities fraud and one count of circumventing account controls. He was acquitted of one count of falsifying books, records and accounts (Dkt. No. 1011). On March 5, 2010, defendant was sentenced to 120 months in prison, along with a three-year term of supervised release following the custodial sentence, a $500 special assessment, and a $1, 000, 000 fine (Dkt. No. 1080).

Our court of appeals affirmed defendant's convictions on July 5, 2011, and denied his en banc petition on October 20, 2011 (Dkts. Nos. 1121, 1130). On June 18, 2012, the Supreme Court denied defendant's petition for writ of certiorari. McCall v. United States, 132 S.Ct. 2771 (2012). Defendant timely filed the instant Section 2255 motion on June 17, 2013. After the initial round of briefing was completed, both sides were allowed to submit several rounds of additional briefing. In addition, the Court sua sponte requested ...

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