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COMES NOW the United States of America, by and through Eric F. Melgren, United
States Attorney for the District of Kansas, Terra D. Morehead, Assistant United States
Attorney, for said District, and hereby responds to arguments raised by the defendants
alleging that the Government failed to establish probable cause pertaining to the charge
contained in the Complaint. The defendants’ argument to the Court was premised on the
representation that under a prosecution for a violation of Title 18, United States Code §
pending or underway at the time of the offense and that it would have been necessary for
the defendant’s to have been advised a Federal “official proceeding” was underway. In
making this representation, the defendant’s cited and relied upon Arthur Andersen LLP v.
United States (also referred to as Enron), 544 U.S. 696, 123 S. Ct. 2129 (2005). A review
of Enron and other cases that follow clearly do not support the defendants’ position.
The defendants herein are charged with on or about August 8, 2008, corruptly
concealing a record, document, or other object, or attempting to do so, with the intent to
Case 2:08-cr-20105-CM-JPO Document 22 Filed 08/15/2008 Page 2 of 6
impair the object’s integrity and availability for use in an official proceeding; or, otherwise
violation of Title 18, United States Code § 1512(c). (Doc. 1.) There is no requirement that
an official proceeding be pending or about to be instituted at the time of the offense. See
Title 18, United States Code § 1512(f)(1). There is also no requirement that the
Government establish the “state of mind” of the defendants that the official proceedings be
The Enron case actually involved a violation of the 2000 version of § 1512(b)(2)(A)
and (B), which involved someone knowingly using intimidation or physical force, threats,
or corruptly persuading another person. . .with intent to. . .cause that person to withhold
documents from or alter documents for use in an official proceeding. The facts established
that Enron’s auditor, Arthur Anderson, instructed its employees to destroy documents
pursuant to its document retention policy. The Supreme Court found the jury was not
properly instructed on the elements of “corrupt persuasion” because the instructions failed
544 U.S. at 706, 125 S. Ct. 2128. The Court further held that § 1512(b)(1) encompasses
a “nexus” requirement. 544 U.S. at 707-08, 125 S. Ct. 2129. This “nexus” requirement
means that to convict a defendant of obstructing justice under that subsection, “the
[obstructive] act must have a relationship in time, causation, or logic with the judicial
proceedings.” United States v. Aguilar, 515 U.S. 593, 599, 115 S. Ct. 2357, 132 L.Ed.2d
520 (1995). The Government in Arthur Anderson had argued against finding a “nexus”
§ 1512's subsections, “an official proceeding ‘need not be pending or about to be instituted
2
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at the time of the offense.’ ” Arthur Andersen, 544 U.S. at 707, 125 S. Ct. 2129 (quoting
18 U.S.C. § 1512(e)(1), now codified at § 1512(f)(1)). However, the Court noted: “It is ...
one thing to say that a proceeding ‘need not be pending or about to be instituted at the time
of the offense,’ and quite another to say a proceeding need not even be foreseen. A
‘knowingly ... corrupt persuader’ cannot be someone who persuades others to shred
documents under a document retention policy when he does not have in contemplation any
particular official proceeding in which those documents might be material.” Id. at 707-08,
The facts as presented before the Court of the Neighbors’ conduct is quite
distinguishable from the conduct of Enron’s auditior. It was clearly foreseeable in the case
at hand that an official proceeding would or might occur. Before a defendant may be
convicted of obstruction under § 1512(c)(1), he must believe that his acts will be likely to
affect a pending or foreseeable proceeding . See Arthur Andersen, 544 U.S. at 707, 125
S. Ct. 2129; United States v. Kaplan, 490 F.3d 110, 125 (2d Cir.2007) (“[A] ‘knowingly ...
corrupt persuader’ must believe that his actions are likely to affect a particular, existing or
foreseeable official proceeding.”). See also United States v. Matthews, 505 F.3d 698, 707-
When Carrie Neighbors received the call from her attorney, John Duma, after being
contacted by individuals connected to her pending Federal prosecution, she was put on
notice that authorities were looking into the defendants’ newest eBay scam. They had
obtaining a UPS mailbox in order to receive payments, maintaining a phone in the name
of “Charlie,” and even getting a bank account in the name of an unwitting participant
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(Charlie Rayton). Many of their purchases of items were done in cash and many of them
there is no internal record to memorialize the transaction. There was nothing on the face
of this newest venture that would associate the eBay business with Guy or Carrie
Neighbors or Yellow House. This was obviously done to prevent potential buyers from
knowing who they were truly dealing with and to thwart detection of their conduct by law
enforcement.
multiple brand news one at the same time, in the least, represents willful blindness that they
were engaging, once again, in the business of receiving stolen property. Whatever benefit
of the doubt the defendants might have been entitled to came to a halt on August 7, 2008,
when they were informed that one of the three computers they had received from Samples
was stolen from Kansas University. A reasonable person would have known, at that point,
by failing to cooperate and return all of the stolen materials and turn over supporting
8, 2008, was the fact that an obviously fraudulent document1 was presented to this Court
the charge herein, that the defendants did not provide the document to Detective Riner on
1
Samples told Detectives Bialek and Riner that he received a total of $1,000.00 for
the computer–$400.00 in a check and $600.00 in cash. It is interesting to note that while
this document has the serial number and model number from the stolen K.U. computer
from the initial report, it has no such information on the other two computers, although there
is a notation of 3 Dell Laptop P.C.s.
4
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August 8, 2008, in order to prevent that document’s availability for production and use in
an official proceeding.
The defendants’ arguments to the Court relying on Enron were misapplied to the
about to be initiated. Because of the original eBay case against the Neighbors, they were
on notice that official proceedings under these circumstances were foreseeable. Likewise,
the defendants’ state of mind need not be proven with respect to the circumstances that
the official proceedings are Federal. The charge contained in the Complaint is a proper
charge under the facts herein. The Government has presented probable cause that the
defendants engaged in obstructive behavior and it will be for a jury to determine the
ultimate issue.
Respectfully submitted,
Eric F. Melgren
United States Attorney
s/ Terra D. Morehead
TERRA D. MOREHEAD, # 12759
Assistant United States Attorney
500 State Avenue, Suite 360
Kansas City, Kansas 66101
(913) 551-6730 (telephone)
(913) 551-6541 (facsimile)
E-mail: Terra.Morehead@usdoj.gov
ELECTRONICALLY FILED
Attorneys for Plaintiff
CERTIFICATE OF SERVICE
I hereby certify that on the 15th day of August, 2008, the foregoing was electronically
filed with the clerk of the court by using the CM/ECF system which will send a notice of
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Cheryl Pilate
Attorney for Guy Neighbors
John Duma
Attorney for Carrie Neighbors
s/ Terra D. Morehead
TERRA D. MOREHEAD, # 12759
Assistant United States Attorney