[00:00:02] Speaker 03:
So good morning.

[00:00:03] Speaker 03:
Each side is going to have ten minutes on this case.

[00:00:06] Speaker 03:
If you would like to reserve time for rebuttal, please be aware that you are responsible for keeping track of your time, but I do want to know if you'd like to reserve any.

[00:00:15] Speaker 04:
Thank you very much.

[00:00:16] Speaker 04:
Good morning.

[00:00:17] Speaker 04:
May it please the court and council.

[00:00:20] Speaker 04:
My name is Amy Krause.

[00:00:21] Speaker 04:
I'm appearing on behalf of the appellant, Mark Avery, and I would like to reserve two minutes for rebuttal.

[00:00:28] Speaker 04:
This morning I'd like to start with the standard of review because regretfully, that was not as clear as it should have been in the briefs.

[00:00:38] Speaker 04:
And frankly, I was reminded when I saw Judge Smith this morning that when I argued before him about a year and a half ago in that argument, he referred to himself as a standard of review guy.

[00:00:49] Speaker 04:
So I think that it's appropriate to start there and beneficial to start there.

[00:00:56] Speaker 04:
Where, as here, the issue is appellate counsel's failure to raise an issue on direct appeal, then we are looking at the Strickland standard, deficient performance and prejudice.

[00:01:09] Speaker 04:
Deficient performance occurs when the attorney unreasonably failed to discover a non-frivolous claim, and prejudice occurs when that claim would have provided grounds for reversal.

[00:01:21] Speaker 04:
So on direct appeal,

[00:01:23] Speaker 04:
This court would have reviewed Mr. Avery's claim for plain error because trial counsel didn't object to the fraud instructions under Shaw.

[00:01:36] Speaker 04:
Under the plain error standard of review, the error is clear or obvious and

[00:01:43] Speaker 04:
As to this element, the government conceded in its brief that the error was evident at the time of the appeal.

[00:01:51] Speaker 04:
We agree with that.

[00:01:52] Speaker 04:
And we also agree with the government that the last two conditions for plain error are satisfied if there is a reasonable probability that the error affected the outcome.

[00:02:06] Speaker 04:
So in this way, the two standards intersect.

[00:02:09] Speaker 04:
If there is a reasonable probability that the instructional error affected the outcome, then there was plain error at trial and Strickland error on appeal.

[00:02:21] Speaker 04:
And the remedy is to remand for a new trial.

[00:02:26] Speaker 00:
However, to determine substantial rights are affected, you must show that it's more than a mere possibility or uncertainty

[00:02:40] Speaker 00:
that your argument would be successful, correct?

[00:02:45] Speaker 04:
I agree with that.

[00:02:46] Speaker 00:
So it's got to be more than a mere possibility, more than just simply uncertain.

[00:02:53] Speaker 00:
And that's where we are today, right?

[00:02:56] Speaker 00:
And then coupled with that, since it is on review of ineffective assistance at council, it's got to be prejudicial.

[00:03:11] Speaker 04:
I agree with you, Judge.

[00:03:12] Speaker 04:
And I would explain it this way.

[00:03:16] Speaker 04:
So under plain error review, there is review for harmlessness, meaning would the error have affected the outcome of the case?

[00:03:27] Speaker 04:
And that's where I think there is an overlap.

[00:03:31] Speaker 04:
Strickland prejudices, I would even argue,

[00:03:35] Speaker 04:
higher standard because the prejudice prong of the Strickland analysis requires a reasonable probability.

[00:03:42] Speaker 00:
I understand that but if we've already affected the standard of review so much to say that has got to affect substantial rights

[00:03:57] Speaker 00:
and substantial rights are only affected if it's more than a mere possibility, then it seems to me that it would be harder to sow prejudice under the Strickland standard.

[00:04:10] Speaker 04:
I agree.

[00:04:11] Speaker 04:
And of course that makes sense because

[00:04:16] Speaker 04:
It wouldn't make sense to make it easier to reverse a conviction on a necessarily Strickland error than a plain error review.

[00:04:24] Speaker 04:
So I think we're in the same place, which still requires us to look under Shaw, look at the evidence in light of Shaw, and to ask, would

[00:04:34] Speaker 04:
the jury properly instructed have would proper instructions have affected the verdict would there have been a reasonable probability of a different outcome had the jury been properly instructed given the standard of review yes and given that the judge who heard all the evidence the first time had to make a decision in this case before it got to me

[00:05:03] Speaker 00:
Why am I in a better position than that judge to make this decision?

[00:05:08] Speaker 00:
I only read the transcript and listen to good counsel like you and counsel over there.

[00:05:15] Speaker 00:
But that judge was there, heard the evidence, knew how it was presented, knew how it came in, knew why it came in, and that judge says,

[00:05:30] Speaker 00:
A jury verdict would have been the same if it had been instructed this way it should have been.

[00:05:38] Speaker 00:
Knowing the evidence.

[00:05:40] Speaker 00:
That same judge is the same judge, I was there one day, who can take the verdict away from the jury if he doesn't think there's evidence.

[00:05:51] Speaker 00:
That same judge is the same judge who can ask for a new trial if he doesn't think there's enough evidence.

[00:05:59] Speaker 00:
So why am I reading this transcript, even though I'm listening to good advocates like you, but because I suggest that probably had good advocates like you in front of that judge too.

[00:06:13] Speaker 00:
Why am I in a better position than he or she to make those determinations?

[00:06:19] Speaker 04:
Because this court has de novo review I know that of that court's decision and that's the responsibility of this court to undertake de novo review giving due deference to findings of fact, of course, but Can I ask you to talk to me about?

[00:06:38] Speaker 03:
United States versus science Saini Sianni.

[00:06:42] Speaker 03:
It's one of our Ninth Circuit cases and

[00:06:44] Speaker 03:
uh... it was same kind of i i i want to get to the or versus and in the language of course so how is this different because in that case uh... it's where intent to deceive and cheat are intertwined such as in a scheme to obtain money by deception a defendant cannot show that the jury jury's verdict would have been different with the conjunctive instruction so talk to me about that and also miller because i think they're similar

[00:07:15] Speaker 04:
In Shaw and Miller and the case that you cite that I can't pronounce.

[00:07:20] Speaker 02:
Is that say any I think how do you say I say I just go say any let's go with that.

[00:07:24] Speaker 00:
I called us Heidi.

[00:07:27] Speaker 04:
That sounds good to me.

[00:07:29] Speaker 04:
So I don't think they are intertwined in this case and I'll tell you why I think there is a

[00:07:35] Speaker 04:
superficial or visceral appeal to saying, of course there is deception and cheating because he got this money.

[00:07:42] Speaker 04:
But what Shaw tells us is that in order for a defendant to be convicted, to establish fraudulent intent, the government has to show that the defendant used some form of deception with the goal of and for the purpose of depriving the victim of money.

[00:08:01] Speaker 04:
And so in this case, if you look at the aviation plan that Mr. Avery proposed, it was an investment plan.

[00:08:09] Speaker 04:
So the question is, what was his intent?

[00:08:11] Speaker 04:
Did he intend to take that money and divert it for his own use or as

[00:08:17] Speaker 04:
He argued, and I think the evidence amply demonstrates, he was trying to build an aviation company that would be an investment and would be profitable for the trust.

[00:08:28] Speaker 04:
He wasn't trying to harm the trust at all.

[00:08:30] Speaker 02:
Ms.

[00:08:31] Speaker 02:
Krauss, if I can, I know you're trying to save time, but I don't know how I'm looking at Sione in terms of deception to misappropriate funds.

[00:08:39] Speaker 02:
The record is clear in this case that he spent many of the funds on personal mortgages, vehicles, and gifts that would have benefited himself.

[00:08:47] Speaker 02:
I mean, enormous amounts of money, having nothing to do with a business plan of any sort.

[00:08:52] Speaker 02:
And how would you distinguish this case from Saini, which says that the nature of the scheme is such that it implicates both intent to cheat and vice versa, so it makes no difference as to the disjunctive or the conjunctive?

[00:09:05] Speaker 02:
I think that argument flies in the face of the evidence in the case.

[00:09:09] Speaker 02:
He still owes $46 million to the trust, apparently, and for personal expenses.

[00:09:13] Speaker 02:
How does that not involve both intent to deceive and cheat?

[00:09:18] Speaker 04:
Well, I think you have to consider the fact that I have a minute, and I'm going to answer your question.

[00:09:24] Speaker 03:
I'll go ahead and give you two minutes for rebuttal.

[00:09:27] Speaker 03:
Thank you.

[00:09:27] Speaker 03:
Go ahead and respond.

[00:09:29] Speaker 04:
So I understand that argument, and that's exactly the argument that the government made at trial.

[00:09:35] Speaker 04:
And yet, in fact, they said the clearest evidence of Mr. Avery's intent to deceive or cheat, because that was the instruction at the time, was his personal expenditures.

[00:09:48] Speaker 04:
The jury acquitted him of one wire fraud count and hung on another wire fraud count that had associated money laundering counts that they also hung on that were for those personal expenditures.

[00:10:01] Speaker 04:
So the jury did not find that evidence compelling.

[00:10:04] Speaker 02:
He found it compelling on other accounts.

[00:10:06] Speaker 02:
He was convicted on other accounts.

[00:10:07] Speaker 02:
That is not in perpetuity in terms of how that was woven in the jury verdict.

[00:10:13] Speaker 04:
That's true, but I don't think a fair

[00:10:16] Speaker 04:
assessment, I don't think that you can discard that hung jury on that count completely.

[00:10:23] Speaker 02:
I don't mean to cut you off because we have time.

[00:10:24] Speaker 02:
I'm just trying to focus upon following up on Judge Smith's question.

[00:10:31] Speaker 02:
The evidence is abundantly clear that he paid off two mortgages, a debt on a Chevy Kodiak truck, purchased jet skis, ATVs, snow machines, motor homes, a moose boat designed for police and military escorts, a skeet steerer loader,

[00:10:45] Speaker 02:
I mean, there are all kinds of personal expenditures that are spent here.

[00:10:48] Speaker 02:
So how is it not really within the ambit of Saini in terms of the two are interwoven with that question, both intent to deceive and cheat?

[00:10:56] Speaker 04:
With respect to some of the personal items that you mentioned, those were related to counts that he was acquitted on.

[00:11:01] Speaker 04:
But with respect to other expenditures.

[00:11:04] Speaker 02:
But not all.

[00:11:05] Speaker 02:
He was convicted on personal expenditures as well on some of those counts.

[00:11:08] Speaker 04:
That's correct.

[00:11:09] Speaker 04:
But these were all accomplished by the same, you know, the language of the statute is plan or scheme.

[00:11:14] Speaker 04:
I think it's important to remember that the plan or scheme goes back to what Mr. Avery proposed at the very beginning on May 9th, May 11th, and also July 27th.

[00:11:24] Speaker 04:
And then

[00:11:26] Speaker 04:
And then how those purchases were spent.

[00:11:29] Speaker 04:
The trustees were well aware of money going into accounts of RPS.

[00:11:35] Speaker 04:
They directed that they go there.

[00:11:37] Speaker 04:
They knew that he was building an air charter business that included medevac and contracts and a pilot training school.

[00:11:45] Speaker 04:
And they didn't object.

[00:11:46] Speaker 04:
So again, I think what Shaw does is it causes the jury to have to,

[00:11:54] Speaker 04:
look at the plan that was proposed, what were its goals,

[00:11:59] Speaker 04:
What was it, how the money was to be used and what was Mr. Avery's intent?

[00:12:04] Speaker 04:
Was it to deprive the trust of money or was it to build an art air charter business that would be profitable for both himself and for the trust?

[00:12:11] Speaker 04:
And I don't think that the expenditure of those funds on some personal items obliterates his intent from the outset.

[00:12:20] Speaker 00:
But if we really look at Saini, the thing that I think is hardest for you.

[00:12:25] Speaker 04:
Yes.

[00:12:25] Speaker 00:
is that in Sione, the defendant came up and said, we're totally innocent.

[00:12:32] Speaker 00:
We didn't do anything wrong.

[00:12:34] Speaker 00:
Nothing was it.

[00:12:38] Speaker 00:
And then the court looked at it and looked at everything.

[00:12:46] Speaker 00:
They said, well, based on your defense, it's hard for you to argue what you're arguing.

[00:12:53] Speaker 00:
So then I looked at your defense.

[00:12:55] Speaker 00:
Well, your defense was, there's no way.

[00:12:59] Speaker 00:
There's no way.

[00:13:01] Speaker 00:
I'm totally innocent.

[00:13:03] Speaker 00:
I didn't have any deception.

[00:13:05] Speaker 00:
Not only I didn't have any deception, I didn't have any cheating.

[00:13:09] Speaker 00:
So you used the same defense that Signe did.

[00:13:12] Speaker 00:
And I guess this defense, you're totally innocent.

[00:13:17] Speaker 00:
How can there be substantial prejudice then, just like in Sinead, when the state had to prove both instead of just one of them because the state

[00:13:28] Speaker 00:
It's a prejudice argument.

[00:13:29] Speaker 00:
And if Saini is really, and I thank my colleague for going there, if that's really the bottom line, then you use the same defense and I guess we'd have to come out the same way they did.

[00:13:43] Speaker 04:
Different evidence, different facts.

[00:13:44] Speaker 00:
Well, but it is the defense.

[00:13:47] Speaker 00:
It's not about what evidence you had or you didn't have.

[00:13:50] Speaker 00:
It's the defense about your defense was, I'm totally innocent.

[00:13:56] Speaker 00:
So it doesn't matter.

[00:13:57] Speaker 00:
I didn't cheat.

[00:13:58] Speaker 00:
I didn't deceive.

[00:13:58] Speaker 00:
I didn't do anything.

[00:14:00] Speaker 00:
So what's the prejudice if they had to prove one or two?

[00:14:02] Speaker 00:
If your total defense was, I didn't do either.

[00:14:06] Speaker 00:
That's what Saini says.

[00:14:07] Speaker 00:
There's no prejudice.

[00:14:09] Speaker 04:
May I answer, Your Honor?

[00:14:11] Speaker 00:
Yeah.

[00:14:12] Speaker 04:
So on the deception side, because we don't know if the jury was instructed deceive or cheat.

[00:14:19] Speaker 04:
So we don't know what they found as to each counts.

[00:14:22] Speaker 04:
We don't know, obviously.

[00:14:24] Speaker 04:
So on the deception side,

[00:14:28] Speaker 04:
The things that the government argued that were variables, things that changed, that proved the deception were things that the trustees knew about and either implicitly or expressly approved.

[00:14:39] Speaker 04:
So that's how I think the evidence shows there was no deception.

[00:14:42] Speaker 04:
And then with the cheating, I take the court back to

[00:14:45] Speaker 04:
What was Mr. Avery's intent?

[00:14:48] Speaker 04:
It was to build a profitable air charter business.

[00:14:50] Speaker 04:
Maybe he went about it the wrong way, but his intent was not to steal money from the trust.

[00:14:55] Speaker 04:
He wanted to make money for the trust.

[00:14:57] Speaker 04:
He was paying interest to the trust, and he thought his business would be profitable.

[00:15:01] Speaker 02:
And he so presented that in his own testimony.

[00:15:03] Speaker 02:
He testified at trial, correct?

[00:15:05] Speaker 02:
And the jury rejected it.

[00:15:06] Speaker 02:
Some of it, at least.

[00:15:07] Speaker 03:
But they accepted some of it as well.

[00:15:10] Speaker 03:
Thank you.

[00:15:11] Speaker 03:
Thank you, counsel.

[00:15:11] Speaker 03:
I'll give you two minutes for rebuttal.

[00:15:12] Speaker 03:
We are the reason you went over time.

[00:15:25] Speaker 01:
Good morning, may it please the court, Stephen Corso of the United States.

[00:15:29] Speaker 01:
There's no reasonable possibility here that the jury could have convicted the defendant on the basis of deception alone, that is, without the intent to obtain money from the trust or the bank.

[00:15:41] Speaker 01:
It's clear beyond a reasonable doubt that the jury verdicts would have been the same, even if the court had properly instructed the jury here.

[00:15:49] Speaker 01:
Miller provides the analytical path forward.

[00:15:53] Speaker 01:
Miller placed great emphasis on other language in the instructions that were given and concluded that was the most important factor.

[00:16:01] Speaker 01:
And that instruction here was that the government had to prove a scheme or plan to defraud or obtain money by means of false or fraudulent pretenses, representations or promises.

[00:16:13] Speaker 00:
Let me ask you a question before we get to all that.

[00:16:17] Speaker 00:
Shaw has to do with bank fraud.

[00:16:20] Speaker 00:
Yes.

[00:16:21] Speaker 00:
Miller has to do with wire fraud.

[00:16:25] Speaker 00:
Yes.

[00:16:25] Speaker 00:
And with taking both of those, we come up with a problem.

[00:16:29] Speaker 00:
But this defendant was convicted of six counts of money laundering.

[00:16:36] Speaker 00:
Correct.

[00:16:36] Speaker 00:
And one count of making false statements as well.

[00:16:40] Speaker 00:
Correct.

[00:16:40] Speaker 00:
Which really have nothing to do with

[00:16:43] Speaker 00:
the Shaw problem or the Miller problem.

[00:16:47] Speaker 00:
So why don't we just impose those sentences and go on?

[00:16:53] Speaker 00:
I mean, I don't understand why we're really here.

[00:16:58] Speaker 00:
We could impose those sentences.

[00:16:59] Speaker 00:
The sentences would be done.

[00:17:01] Speaker 00:
And frankly, the sentences wouldn't be any shorter.

[00:17:05] Speaker 00:
Why are we here arguing about this?

[00:17:08] Speaker 01:
We would be happy if the court took that position.

[00:17:11] Speaker 01:
However, the money laundering counts are predicated on the wire fraud counts.

[00:17:16] Speaker 00:
That's what I thought.

[00:17:17] Speaker 01:
If the wire fraud counts are faulty, then the money laundering counts would be faulty as well.

[00:17:24] Speaker 00:
All right.

[00:17:24] Speaker 00:
Very good.

[00:17:26] Speaker 00:
What about the making false statements?

[00:17:31] Speaker 01:
I don't see that as the same problem.

[00:17:32] Speaker 01:
We think that count would survive if the court were to find

[00:17:37] Speaker 01:
prejudicial error here on the instructions.

[00:17:39] Speaker 02:
There was one count of a bank fraud and another count of false statements to a bank, two separate counts, correct?

[00:17:46] Speaker 01:
Correct.

[00:17:46] Speaker 02:
On which he was convicted.

[00:17:47] Speaker 01:
Correct.

[00:17:48] Speaker 01:
And they're both predicated on the same conduct, which is misrepresenting the assets and liabilities in his personal financial statement.

[00:17:57] Speaker 03:
What do you make of counsel on the other side's argument that the trustees were also aware of what was happening and either

[00:18:08] Speaker 03:
Participated in it or allowed it to happen does that matter should we consider that I?

[00:18:13] Speaker 01:
Think factually that's very weak Our position is that the defendant mr. Avery did not inform the trustees his co-trustees of all the personal expenditures and it multiple steps along on the way here over a several month period deceive the trustees lie to the trustees and omitted material information and I

[00:18:34] Speaker 01:
We believe very strongly that had the trustees been informed by Mr. Avery of all the personal purchases and expenditures, all the extravagance, they would have shut down the scheme immediately.

[00:18:45] Speaker 01:
It's important for the court to note that in the aftermath, when all this came to light, the co-trustee's removed Mr. Avery as a trustee.

[00:18:56] Speaker 01:
They were very angry and devastated at the defendant's conduct.

[00:19:00] Speaker 01:
And of course, the trust lost $46 million.

[00:19:04] Speaker 02:
I think following up to Judge Delba's question, I think the record also reflects that Avery did not provide documentation to his co-trustees in response to an email from co-trustee Matheny, I believe, requesting more information.

[00:19:21] Speaker 02:
He never responded.

[00:19:22] Speaker 01:
That's right, sir.

[00:19:22] Speaker 01:
That was in June of 2005, toward the end of June.

[00:19:26] Speaker 01:
And by that time, Mr. Avery had already withdrawn, I think, $35 million of the

[00:19:31] Speaker 02:
I think the request was actually the agreement with regional protective services relating to use of a margin account at RBC and give us more information.

[00:19:39] Speaker 02:
And Avery never responded to that.

[00:19:41] Speaker 01:
That's right.

[00:19:41] Speaker 01:
That's absolutely right.

[00:19:45] Speaker 01:
As the court has alluded to already, the facts and evidence, the cases presented by both sides are critical here.

[00:19:51] Speaker 01:
And the instruction demanding that the jury find a scheme to defraud

[00:20:01] Speaker 01:
Based on those two things, this court should feel very comfortable that the jury verdict would not have been altered by a different instruction.

[00:20:09] Speaker 00:
Doesn't the standard review question really turn such that if it were plain air review, we would know that the state would have the burden of proof, but now we're

[00:20:25] Speaker 00:
didn't have the objections.

[00:20:26] Speaker 00:
So at that point, it would turn the burden of proof to the defendant, right?

[00:20:32] Speaker 00:
So the defendant has the burden of proof in this particular case, right?

[00:20:37] Speaker 01:
If the court found that plain air review was the standard, we think it's de novo, however.

[00:20:43] Speaker 00:
Well, I know.

[00:20:43] Speaker 00:
But you think it's de novo only because you're really suggesting that.

[00:20:52] Speaker 00:
Given the two standards, one with an objection and one without an objection, somebody can come up with the novel review.

[00:21:00] Speaker 00:
But I'm trying to boil this down to plain science for me.

[00:21:05] Speaker 00:
It seems to me that what you're really arguing is that the defense has the standard review here.

[00:21:11] Speaker 00:
That's the real reason you've got it going the way you want it in this particular case.

[00:21:17] Speaker 01:
I don't know that we agree with that.

[00:21:18] Speaker 01:
We're happy to take the burden here.

[00:21:20] Speaker 01:
We feel the instruction, as I've alluded to, is strong.

[00:21:25] Speaker 01:
And the factual record here is strong.

[00:21:29] Speaker 01:
We would prevail on whatever standard review the court applies.

[00:21:32] Speaker 01:
The government is confident that we're going to prevail here.

[00:21:41] Speaker 01:
The court's aware, but I think it's worth mentioning again

[00:21:46] Speaker 01:
The extravagant purchases the defendant made, including buying World War II airplanes, a P-51 fighter, a Corsair fighter, a yacht, a moose boat, motor homes, ATVs, and paying personal debts.

[00:22:02] Speaker 01:
Again, he did not tell the co-trustees of all these purchases.

[00:22:06] Speaker 01:
He also lied to the trustees in other ways.

[00:22:09] Speaker 01:
He never formed an escrow account, which he mentioned when making the proposal.

[00:22:14] Speaker 01:
The court's aware that he did not provide documents to the co-trustee, Matheny.

[00:22:19] Speaker 01:
And he delayed telling the co-trustees that he had forced out Gilliland, the real expert in the aviation medevac business,

[00:22:28] Speaker 01:
delayed telling the co-trustee until the end of July of 2005, and by that time he had withdrawn $43 million in loan funds, which is about 80% of what he withdrew in total.

[00:22:40] Speaker 01:
In the aftermath of the scheme, he sold assets out from under the trust.

[00:22:43] Speaker 01:
He sold the planes at deep discounts.

[00:22:46] Speaker 01:
The Corsair, for instance, was bought for $2.4 million, but he sold it for $1 million.

[00:22:51] Speaker 01:
He never gave the trust an opportunity to sell the assets.

[00:22:55] Speaker 01:
On its own and then when he raised proceeds from selling some of these assets He kept the assets and tried to divert them from the trust and prevent the government from seizing them by depositing them with his token spirit or so to speak mr. Cain's defense attorney's accounts and

[00:23:13] Speaker 01:
He lied in his bankruptcy proceedings.

[00:23:15] Speaker 01:
He again tried to backdate a $2.6 million promissory note, all in an effort to keep that money from being seized or keep it from going to the trust.

[00:23:24] Speaker 01:
Again, he was removed as a trustee, and the trustee as a direct result of his conduct lost $46 million.

[00:23:30] Speaker 00:
Could I interrupt you a little bit?

[00:23:32] Speaker 00:
What do you have to say about the Second and Sixth Amendment claim, if anything?

[00:23:38] Speaker 01:
That's the ineffective claim of the uncertified trial.

[00:23:45] Speaker 00:
Your brief said you're not going to address it unless we think it's significant.

[00:23:48] Speaker 00:
But I'm now saying it's significant enough for you to tell me what's your argument.

[00:23:55] Speaker 01:
We agree with the trial judge's finding that the defense lawyer presented a very stout defense.

[00:24:02] Speaker 01:
It was very feisty, and then they contested every

[00:24:06] Speaker 01:
allegation, most every allegation the government made.

[00:24:09] Speaker 01:
Mr. Avery was well represented in this court, so I feel very confident that he received adequate trial.

[00:24:16] Speaker 00:
Council an adequate defense and the jury just did not buy his defense and for good reason it's very difficult to justify all these wild Purchases and the seizing of all this money well such a rapid rate There's no doubt that they can't show the prejudice that they that we would normally have on a Sixth Amendment claim, but they're Assuming prejudice based on insulting language and profanity What do you have to say about that?

[00:24:48] Speaker 01:
The relationship wasn't always a happy one, but that doesn't mean that counsel wasn't professional enough to step in in the courtroom and provide a very significant defense and challenge the government at every step.

[00:25:00] Speaker 03:
So counsel, I'm sure you're aware of Frasier, which basically says, look, a severe breakdown in communication, you can almost presume prejudice there.

[00:25:09] Speaker 03:
That's essentially, in a nutshell, what they're arguing is they didn't talk anymore.

[00:25:13] Speaker 03:
They didn't get along.

[00:25:13] Speaker 03:
Mr. Avery couldn't assist in his own representation because he couldn't talk to his attorney.

[00:25:20] Speaker 03:
What do you have to say to that?

[00:25:23] Speaker 01:
Again, despite the unhappy relationship, he did receive an outstanding defense.

[00:25:28] Speaker 01:
And that's what the trial court found.

[00:25:30] Speaker 01:
And we agree with that.

[00:25:31] Speaker 01:
And we think this court should have every confidence in that.

[00:25:33] Speaker 02:
Standard review on that is a substantial showing of a denial of a constitutional right as to the uncertified claim as a Sixth Amendment representation, correct?

[00:25:43] Speaker 02:
Yes.

[00:25:45] Speaker 03:
Thank you, Council.

[00:25:46] Speaker 01:
Thank you.

[00:25:46] Speaker 01:
Thank you, Your Honor.

[00:25:52] Speaker 03:
And Ms.

[00:25:52] Speaker 03:
Krauss, we're going to give you the two minutes for rebuttal.

[00:26:13] Speaker 04:
Thank you.

[00:26:13] Speaker 04:
I appreciate the additional time.

[00:26:15] Speaker 04:
With respect to some of the things that Mr. Corso mentioned that happened in the aftermath, I think was the word that he used of what happened at Security Aviation and including the removal of Avery as a trustee, respectfully, when the question is,

[00:26:37] Speaker 04:
What were the representations or omissions that were made?

[00:26:40] Speaker 04:
And what was Mr. Avery's intent when he made those representations?

[00:26:45] Speaker 04:
Those things are not very informative about what those representations were.

[00:26:53] Speaker 02:
You've based your argument to some extent on the fact that the jury asked for clarification on the knowledge instruction.

[00:26:59] Speaker 04:
Yes.

[00:27:00] Speaker 02:
And you argued that perhaps that would indicate the jury did not

[00:27:05] Speaker 02:
believe he had intent to deceive and cheat, correct?

[00:27:09] Speaker 02:
The knowledge instruction, essentially the original instruction was, according to the record, an act is done knowingly if the defendant is aware of the act and does not act or fail to act through ignorance, mistake, or accident.

[00:27:22] Speaker 02:
The government is not required to prove that the defendant knew that his acts or omissions were unlawful.

[00:27:26] Speaker 02:
That's a boilerplate instruction.

[00:27:28] Speaker 02:
And the jury came out with a question as to would you clarify that, what constitutes acting knowingly?

[00:27:35] Speaker 02:
And you placed emphasis upon that in your brief, I believe, in terms of your argument.

[00:27:40] Speaker 02:
The response given was that the trial judge said you've asked for clarification of instruction number 26, which defines knowingly.

[00:27:48] Speaker 02:
You should consider this response in conjunction with all instructions as a whole and not in place of another instruction.

[00:27:54] Speaker 02:
And then the court specifically instructed the jury, you may find that the defendant acted knowingly if you've

[00:27:58] Speaker 02:
If you find beyond a reasonable doubt that the defendant was aware of a high probability that the money involved in these transactions was illegally obtained as defined in these instructions and deliberately avoided learning the truth.

[00:28:12] Speaker 02:
You may not find such knowledge however if you find that the defendant actually believed

[00:28:17] Speaker 02:
that the money was legitimately obtained or if you find that the defendant was simply careless.

[00:28:22] Speaker 02:
That was the response.

[00:28:23] Speaker 02:
They heard him testify.

[00:28:25] Speaker 02:
And I just don't understand the basis of saying that they would differentiate between intent to deceive and cheat based upon your argument on knowingly that the court came back and instructed further on knowingly.

[00:28:37] Speaker 04:
So the reason that I pointed that in the brief was to distinguish in Miller where the court didn't just rely on the wire fraud instruction as providing the deceive and cheat language, they relied on

[00:28:56] Speaker 04:
instructions on another conviction and the court also mentioned and besides if the jury had a Question if they weren't if they weren't clear on what the instruction meant then they would have asked for clarification so the reason that I mentioned the jury's question in this case is to Highlight that the jury did have a question of course.

[00:29:16] Speaker 04:
We don't know what instruction it went to but what Miller says is

[00:29:22] Speaker 04:
You have to think about a jury asking for clarification What could that have meant and also not relying on that instruction at?

[00:29:29] Speaker 04:
As well if if there was nothing wrong with the wire fraud instruction that was given Miller wouldn't have had to talk about other instructions on other counts of conviction or talk about Potential jury confusion so counsel you are well over time.

[00:29:44] Speaker 03:
I am I

[00:29:45] Speaker 03:
Give me 10 seconds, I'll give you your final 10 seconds to wrap it up.

[00:29:48] Speaker 04:
My final 10 seconds is everything that the government has said varied from the original aviation plan that Avery proposed was either approved expressly or implicitly by the trustees and therefore those variations could not have been essential to the plan.

[00:30:08] Speaker 04:
And if the jury had been properly instructed, there is a reasonable probability that the outcome would have been affected, plain error occurred at trial, Strickland error occurred on appeal, and this court should vacate Mr. Avery's convictions.

[00:30:25] Speaker 04:
Okay.

[00:30:25] Speaker 03:
Thank you.

[00:30:26] Speaker 03:
Thank you.

[00:30:27] Speaker 03:
Thank you to both counsels.

[00:30:27] Speaker 03:
This matter is now submitted.