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Federal Criminal Defense Blog

Federal Criminal Defense and Civil Litigation in Georgia and Beyond

Lawyers for Mass Email Hacker Andrew “Weev” Auernheimer Argue Appeal Before the Third Circuit

Posted in Appeals, Cybercrime

Sometime prior to 2011, Andrew “Weev” Auernheimer collected 114,000 email addresses belonging to iPad 3G users and AT&T subscribers, and turned the addresses over to the website Gawker. Gawker proceeded to publish some of the addresses, partially redacted, and the FBI opened an investigation. Auernheimer was charged and found guilty of violating the Computer Fraud and Abuse Act following trial in 2012. He was sentenced to 41 months’ imprisonment, and has thus far served 12 months.

As reported in the Guardian, “Weev’s” lawyers are arguing today in the U.S. Court of Appeals for the Third Circuit for his conviction to be overturned. Auernheimer’s attorneys contend that he did not commit any crime because AT&T’s security was so lax that its customers’ email addresses were effectively publicly available.

The case is being followed closely by those interested in cyber law who are worried about the effect of Auernheimer’s conviction on the willingness of persons to report security and privacy flaws. Prominent computer scientists, academics, and researchers, including the Mozilla Foundation and a former technologist for the Federal Trade Commission, have asked the Court of Appeals to overturn “Weev’s” conviction.

I have always found that mercy bears richer fruits than strict justice. — Abraham Lincoln

Glenwood, Georgia, Woman Pleads to Making $460K in False Claims to VA

Posted in Uncategorized

Per SF Gate, Loretta Smith of Glenwood, Georgia, pled guilty last Wednesday in the U.S. District Court for the Middle District of Georgia to taking more than $460,000 in Department of Veterans Affairs benefits. Smith was alleged to have made false claims to the VA for travel expenses which she never incurred and reimbursements for medical treatments which she never received.

“Wherever Law ends, Tyranny begins.” -John Locke

GA Father and Son Sentenced for Bank Fraud for Bribing Banker in Exchange for $13 Million in Loans

Posted in Bank Fraud

Last Monday, Brad Heard, Sr., of Camilla, Georgia, and Brad Heard, Jr., of Leesburg, Georgia, were sentenced in the U.S. District Court for the Middle District of Georgia to 30 and 33 months’ imprisonment respectively, and were ordered to pay $5 million in restitution. The father and son entered guilty pleas back in September to charges of bank fraud in which they admitted to paying bribes and kickbacks to a banker and his wife in Bainbridge, Georgia, in exchange for loans totalling $13,000,000. The article appears on BainbridgeGa.com.

Lawyer: “What was the first thing your husband said to you when he woke that morning?”
Witness: “He said, ‘Where am I, Cathy?’”
Lawyer: “And why did that upset you?”
Witness: “My name is Susan.”

AC/DC Drummer Phil Rudd Acquitted on Charges of Making False Statement on Pilot’s License Application

Posted in Acquittal

Phil Rudd, drummer for the Australian hard rock band AC/DC and one of the greatest drummers of all time, was acquitted yesterday in a New Zealand District Court of charges that he lied about his prior drug use to obtain a medical certificate to enable him to renew his private pilot’s license, according to the New Zealand Herald. Rudd answered “No” to the question about having any history of drug use on a medical certificate application in 2012.

The answer predictably raised some eyebrows, including with New Zealand’s Civil Aviation Authority. The article states that Rudd was discovered with 23 grams of marijuana in his home and his boat during a police raid in 2010. Rudd was discharged without a conviction on appeal. Nonetheless, Mr. Rudd, we salute you on beating this latest charge.

“No stop signs, speed limits, nobody’s going to slow me down.  I’m on a highway to hell.” – AC/DC

Iowa Pharmacist Acquitted on Charges of Fraudulently Billing Insurer for Hemophilia Medications

Posted in Acquittal, Health Care Fraud

From The Republic comes news that Michael Stein, a pharmacist and owner of Pharmacy Matters in Iowa City, Iowa, was acquitted yesterday in the U.S. District Court for the Southern District of Iowa on charges of allegedly fraudulently billing Wellmark Blue Cross and Blue Shield for drugs for hemophilia patients. The government alleged that Mr. Stein billed Wellmark for the drugs when his pharmacy actually did little or no work dispensing the drugs, but instead acted as a “pass through” entity for certain Florida drug companies shipping the drugs to patients.

Stein defended that the patients were entitled to coverage through Wellmark for the drugs, and that the prosecution failed to prove that he intended to defraud Wellmark or made any false statements. Experts at trial disagreed regarding whether the pharmacy provided services for which it could bill Wellmark.

Pharmacy Matters previously sued Wellmark in 2009 after Wellmark refused to pay millions in reimbursements for factor drugs for hemophilia patients, which case involved the same claims as in the criminal case. Just as the judge in the civil case was preparing to rule, however, the government indicted But just as an Iowa judge was preparing to rule last year, Stein was indicted criminally over the claims.

“Law applied to its extreme is the greatest injustice” — Cicero

Leader of Hindu Temple of Georgia Indicted on Federal Fraud Charges

Posted in Fraud

From 11 Alive News comes a story on Annamalai Annamalai, the former leader of the Hindu Temple of Georgia, who was indicted last week in the U.S. District Court for the Northern District of Georgia. The government alleges that Annamalai allegedly charged Temple members’ credit cards for alleged spiritual services, allegedly often charging the cards multiple times without the members’ permission. When members disputed the alleged charges, Annamalai would allegedly provide the credit card vendors with false documents to support the transactions.

Annamalai is also alleged to have spent large amounts of Temple money on houses and cars, and to have concealed assets from creditors by diverting Temple income to a separate bank account. The Temple, which is now closed, filed for bankruptcy in 2009. Annamalai is alleged to have submitted false affidavits in bankruptcy court. He was arrested in November.

“The only man who makes no mistake is the man who does nothing.” — Theodore Roosevelt

Georgia Man Pleads Guilty to Conspiring to Operate a Motor Carrier in Violation of Federal Motor Carrier Safety Administration Order

Posted in Transportation Offenses, Uncategorized

According to FleetOwner.com, last Tuesday, Corey Daniels pled guilty in the U.S. District Court for the Middle District of Georgia to charges of conspiring to violate an imminent hazard out-of-service order by the Federal Motor Carrier Safety Administration. Daniels was charged with aiding Devasko Lewis operate trucking carriers, Eagle Transport and Eagle Trans,  after Lewis had been barred from being involved in the operation of trucking companies. The Federal Motor Carrier Safety Administration had ordered Lewis,  doing business as Lewis Trucking Company,  to cease all operations after a crash in Alabama which killed seven people in 2008. Lewis formed another trucking company, DDL Transport LLC, which was also shut down under an imminent hazard order. In 2012, Lewis pled guilty to violating the orders and was sentenced to 12 months’ supervised release, but obtained U.S. Department of Transportation numbers to form Eagle Transport and Eagle Trans using the identities of Daniels and other friends. Daniels and the other conspirators helped Lewis continue operating Eagle Trans after he reported to federal prison in November 2012. Daniels and the other conspirators were indicted in May 2013.

“No man is good enough to govern another man without his consent.” – Abraham Lincoln

Two Defendants in Drug Prosecution Receive Directed Verdict for Lack of Evidence of Connection to Alleged Conspiracy; Court Sanctions AUSA for Prosecutorial Misconduct Relating to Discovery

Posted in Conspiracy

On Thursday, as notedin the Modesto Bee, the U.S. District Court for the District of Hawaii directed its verdict in favor of two defendants in the prosecution of a methamphetamine trafficking ring, finding that the government had failed to present any admissible evidence that the defendants were even slightly connected to the alleged conspiracy.  Harry Akana and Daniel Fola left the their trial as free men. A common rule relating to alleged conspiracy is that “mere association with conspirators and mere presence at the scene of a crime do not in themselves establish participation in a criminal conspiracy…” U.S. v. Brantley, 68 F.3d 1283, 1288 n.4 (11th Cir. 1995).

Four defendants remain in the trial. The defendants were charged with conspiring to distribute more than 400 pounds of methamphetamine.

In January, the judge, U.S. District Judge Leslie Kobayashi, ruled that the government had been “sloppy” and “tardy” in providing discovery material to the defense, finding that the government had withheld evidence relating to certain witnesses who had testified. The judge sanctioned an Assistant U.S. Attorney for prosecutorial misconduct and referred him to the Department of Justice’s Office of Professional Responsibility.

“Government is not reason, it is not eloquence. It is force, and like fire, it is a dangerous servant and a fearful master.” — George Washington

West Virginia Coal Operator and Son Acquitted in Check Cashing/Structuring Prosecution

Posted in Acquittal

From the website of Bailey & Glasser, comes news that, last Thursday, a jury found David A. Cline, owner of Rock N Roll Coal Company in McDowell County, West Virigina, not guilty on charges of alleged conspiracy and structuring financial transactions at the conclusion of a twelve day trial in the U.S. District Court for the Western District of Virginia. Mr. Cline’s son, Joshua Cline, was also acquitted.

The government alleged that the defendants engaged in a check cashing scheme designed to conceal the withdrawal of more than $10 million. J.D. “Dot” McReynolds, a witness for the government, sold cash to coal operators, with an added 10% fee, and provided them with fraudulent invoices to disguise the cash purchases. McReynolds withdrew the cash from various financial institutions in West Virginia and Virginia in amounts of $10,000 or less in order to avoid transaction reporting requirements, a crime called “structuring” of financial transactions. 16 co-defendants of the Clines entered guilty pleas.

“Writing laws is easy, but governing is difficult.” ― Leo Tolstoy

Florida Physician and Pharmacist Acquitted on 44 Counts Relating to Alleged Steroid Ring

Posted in Acquittal

As reported in the Palm Beach Post, this past Thursday, a jury in the U.S. District Court for the Southern District of Florida acquitted Dr. Timothy Sigman, an internist, and pharmacist Peter Del Toro on 44 counts of drug dealing for allegedly operating a steroid ring. The jury deliberated for over six days before returning its verdict.

Dr. Sigman and Del Toro were indicted with five other doctors and others in August of 2011, as part of an investigation called “Operation Juice Doctor 2.” The five other physicians all pled guilty to conspiracy to distribute anabolic steroids, human growth hormone and oxycodone.

However, last month, the Court dismissed charges against the office manager of Treasure Coast Specialty Pharmacy, Del Toro’s pharmacy. And prior to that, the government dismissed approximately 40 charges against Del Toro’s father, a retired police officer.

Prosecutors argued that the defendants were merely drug dealers and pointed to the fact that Dr. Sigman and Del Toro did not charge patients for consultations at the anti-aging clinic they operated, but instead shared profits from drug sales. Dr. Sigman and Del Toro defended that they were passionate about  the power of hormone replacement therapy to cure a variety of age-related ills. Defense attorneys accused the government of overreaching. They argued that the physicians who testified against Dr. Sigman and Del Toro were motivated by an expectation of more lenient prison sentences.

As a result of the criminal proceedings, Sigman and Del Toro lost their licences and had to close down their businesses. Dr. Sigman told reporters that he plans to continue hormone replacement therapy once he receives his medical license back.

“A law is valuable not because it is law, but because there is right in it.” -- Henry Ward Beecher