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United States v. Gutierrez

United States District Court, D. New Mexico

September 6, 2018

UNITED STATES OF AMERICA, Plaintiff,
v.
DARRYL J. GUTIERREZ, Defendant.

          John C. Anderson United States Attorney Reeve L. Swainston Holland S. Kastrin Margaret M. Vierbuchen Assistant United States Attorneys United States Attorney's Office Albuquerque, New Mexico Attorneys for the Plaintiff.

          Jason Bowles Bowles Law Firm Albuquerque, New Mexico Attorney for the Defendant.

          AMENDED [1] MEMORANDUM OPINION AND ORDER

         THIS MATTER comes before the Court on the United States' Motion to Show Cause, filed August 8, 2016 (Doc. 29)(“Motion”). The Court held hearings on August 19, 2016; September 6, 2016; and September 28, 2016. The primary issues are: (i) whether Defendant Darryl J. Gutierrez is financially qualified under the Criminal Justice Act of 1964, 18 U.S.C. § 3006A (“CJA”), to continue to receive the unpaid assistance of a Federal Public Defender; and (ii) whether, if Gutierrez is not financially qualified, he should be compelled to make partial payment for the Federal Public Defender's representation. The Court concludes that Gutierrez is not qualified under the CJA, largely because he has an $800, 000.00 annuity to draw upon to pay an attorney. Accordingly, the Court determines that he should make a payment to the United States Department of the Treasury for his representation by the Federal Public Defender's Office. The Court grants the Motion.

         FINDINGS OF FACT

         Rule 12(d) of the Federal Rules of Criminal Procedure states: “When factual issues are involved in deciding a motion, the court must state its essential findings on the record.” Fed. R. Crim. P. 12(d). The Court makes the following findings of fact in accordance with rule 12(d) of the Federal Rules of Criminal Procedure:

         1. Gutierrez worked as an engineer at Los Alamos National Laboratories[2] from June, 1981, to April, 2009. See Transcript of Motion Proceedings at 16:22-17:10 (taken September 28, 2016)(Gutierrez, Vierbuchen)(Doc. 55)(“Third Tr.”); Letter from Los Alamos Scientific Laboratory to Darryl Gutierrez at 1-2 (dated June 16, 1981), filed August 19, 2016 (Doc. 32)(Bates No. 3239-40); HR Termination Report of Darryl Gutierrez at 1, (dated April 2, 2009)(Doc. 32)(Bates No. 3377).

         2. In 2000, Gutierrez' annual salary was approximately $80, 000.00; in 2008, it had increased to $104, 000.00. See Darryl Gutierrez 2000 W2 at 1, filed August 19, 2016 (Doc. 32)(Bates No. 2955); Darryl Gutierrez 2008 W2 at 1, filed August 18, 2016 (Doc. 32)(Bates No. 2964).

         3. From July, 2009, to September, 2012, Gutierrez worked at TechUSA, and he had an annual salary of $133, 000.00 in 2010. See Letter from Bonnie L. Bryant to Sharon M. Parker at 1 (dated June 18, 2013), filed August 18, 2016 (Doc. 32)(Bates No. 3476); Darryl Gutierrez 2010 W2 at 1, filed August 19, 2016 (Doc. 32)(Bates No. 3484).

         4. Gutierrez then worked for a brief stint at Hilton Santa Fe Buffalo Thunder Casino. See Letter from Tina Cheung to Sharon Parker at 1 (dated May 10, 2013), filed August 19, 2016 (Doc. 32)(Bates No. 1602).

         5. At the casino, Gutierrez' pay started at $14.42 per hour, and, in April, 2013, he was promoted to night manager, which had an annual salary of $37, 000.00. See Letter from Susan Rivenbark to Darry Gutierrez at 1 (dated April 19, 2013), filed August 19, 2016 (Doc. 32)(Bastes No. 1668); Personnel Authorization Form at 1 (dated January 22, 2013), filed August 19, 2016 (Doc. 32)(Bates No. 1610).

         6. Gutierrez was unemployed from August 2013 to the present. See Draft Transcript of Motion Proceedings at 31:18-20 (taken September 28, 2016)(Gutierrez)(“In Camera Tr.”).[3]

         7. On November 5, 2015, a Grand Jury returned an eleven-count indictment against Gutierrez. See Indictment at 1-9, filed November 5, 2015 (Doc. 1)(“Indictment”).

         8. Count I charges Gutierrez with corruptly endeavoring to obstruct and impede the due administration of Internal Revenue laws from 1997 to 2013, in violation of 26 U.S.C. § 7212(a), by: (i) filing false and fraudulent tax returns with the Internal Revenue Service; (ii) sending frivolous correspondence to the IRS; (iii) filing false W-4 forms with his employers; and (iv) sending correspondence to business and banking institutions to interfere with legal process by the IRS. See Indictment at 1-5.

         9. Counts II through XI charge Gutierrez with making and subscribing false income tax returns for tax years 2000 through 2009, in violation of 26 U.S.C. § 7206(1). See Indictment at 5-9.

         10. The Indictment alleges that, from 2000 to 2009, Gutierrez claimed tax refunds totaling $173, 526.00, whereas, in fact, he owed $125, 624.00 in unpaid income taxes, “such that his false claims totaled approximately $299, 150, not including interest and penalties.” Indictment at 1.

         11. In 2015, Gutierrez withdrew $128, 800.00, after taxes, from two Individual Retirement Accounts (“IRAs”). See In Camera Tr. at 36:12-14 (Court, Gutierrez); See Online Account Information (dated July 22, 2016), filed August 19, 2016 (Doc. 32)(Bates No. 4509).

         12. Gutierrez withdrew $84, 000.00 from one IRA with no taxes withheld. See Online Account Information (dated July 22, 2016), filed August 19, 2016 (Doc. 32)(Bates No. 4508)

         13. He withdrew $56, 000.00 from the other IRA, $11, 200.00 of which was withheld in taxes. See Online Account Information (dated July 22, 2016), filed August 19, 2016 (Doc. 32)(Bates No. 4509).

         14. Gutierrez was arrested on December 2, 2015. See Arrest of Darryl J. Gutierrez (entered December 2, 2015)(text-only entry).

         15. When he was arrested, Gutierrez' income was a $7, 000.00 per month distribution from an IRA. See In Camera Tr. at 30:16-19 (Gutierrez).

         16. As of September 28, 2016, however, that IRA was depleted and Gutierrez began withdrawing $6, 400.00 per month, after taxes, from a variable annuity. See In Camera Tr. at 30:21-31:12 (Court, Gutierrez); Third Tr. at 22:10-11 (Gutierrez).

         17. The annuity's total value “was a little over [$]800, 000.” In Camera Tr. at 31:16-17 (Gutierrez).

         18. Gutierrez believed that he would be able to withdraw a lump sum amount from the annuity to pay for an attorney. See In Camera Tr. at 41:17-19 (Gutierrez).

         19. He also has a credit line from which he thought he would be able to borrow funds to pay for an attorney. See In Camera Tr. at 41:19-20.

         20. Apart from the annuity, Gutierrez owns no other stocks or bonds. See In Camera Tr. at 32:25-33:4 (Court, Gutierrez).

         21. Gutierrez does not own the home in which he resides; the Housing Authority for the Pojoaque Pueblo owns the home. See In Camera Tr. at 32:5-8 (Gutierrez).

         22. Gutierrez receives, however, a $600.00 per month stipend from the Pojoaque Pueblo to maintain that house and property. See In Camera Tr. at 33:24-34:2 (Court, Gutierrez).

         23. Gutierrez owns a time share in Pagosa Springs, Colorado, valued at around $15, 000.00. See In Camera Tr. at 32:18-22 (Court, Gutierrez); id. at 35:8-9 (Gutierrez).

         24. He also owns a 2007 Toyota 4Runner valued at about $8, 000.00. See In Camera Tr. at 33:10-12 (Court, Gutierrez).

         25. Gutierrez values his personal property, e.g., furniture, paintings, at $15, 000.00. See In Camera Tr. at 35:9-10 (Gutierrez).

         26. Gutierrez' monthly expenses include “[m]onthly utilities, gas, electric, cellphone, cable, and the maintenance fees from the time share.” In Camera Tr. at 35:16-17 (Gutierrez).

         27. He has no large monthly debts, however, and he pays the balance of his credit card every month. See In Camera Tr. at 35:18-36:4 (Court, Gutierrez).

         28. Gutierrez has no dependents. See In Camera Tr. at 36:17-18 (Gutierrez).

         29. Gutierrez has not arranged for someone else to hold onto his money in that person's name and to return that money to Gutierrez at a later date. See In Camera Tr. at 33:16-21 (Court, Gutierrez).

         30. Gutierrez gambled away the majority of his 2015 $128, 800.00 IRA withdrawal. See In Camera Tr. at 36:12-14 (Court, Gutierrez); id. at 37:4-8 (Court, Gutierrez).

         31. His $7, 000.00 per month IRA withdrawal also went into gambling. See In Camera Tr. at 37:18-23 (Court, Gutierrez).

         32. The United States estimated that, without interest and penalties, it would seek in restitution about $126, 000.00 in back taxes. See Third Tr. at 35:9-11 (Vierbuchen).[4]

         33. Amber Fayerberg, a New Mexico defense attorney with Freedman Boyd Hollander Goldberg Urias & Ward P.A., represented to Gutierrez that she would take his case for $100, 000.00. See In Camera Tr. at 42:8-10 (Gutierrez); Third Tr. at 21:2-3 (Gutierrez, Vierbuchen).

         34. Since Gutierrez was arrested, he has had the resources to hire a private attorney. See In Camera Tr. at 39:7-11 (Court, Gutierrez). See id. at 30:16-19 (Gutierrez)(stating that, at the time of his arrest, Gutierrez received a $7, 000.00 per month distribution); id. at 30:21-31:12 (Court, Gutierrez)(stating that, after that IRA was depleted, Gutierrez received a $6, 400.00 per month annuity payment); Id. at 31:16-17 (Gutierrez)(stating that Gutierrez had $800, 000.00 in an annuity); Third Tr. at 17:17-19 (Gutierrez, Vierbuchen)(Gutierrez' admission that he has had the financial resources to hire an attorney).

         35. A probation officer filled out a Financial Affidavit for Gutierrez based on information Gutierrez relayed. See Third Tr. at 18:20-19:2 (Court, Gutierrez, Vierbuchen). See also Financial Affidavit at 1 (unsigned and undated)(Doc. 7)(“Financial Affidavit”).

         36. The Financial Affidavit lists that Gutierrez' monthly income is $7, 000 from an IRA. See Financial Affidavit at 1.

         37. Gutierrez did not ask for an Assistant Federal Public Defender to represent him. See Third Tr. at 17:20-24 (Gutierrez, Vierbuchen).

         38. The Honorable Steven C. Yarborough, United States Magistrate Judge for the District of New Mexico, however, appointed an Assistant Federal Public Defender -- John V. Butcher -- to represent Gutierrez. See Order Appointing Federal Public Defender (text-only order), entered December 2, 2015 (Doc. 8); Third Tr. at 19:3-6 (Gutierrez, Vierbuchen).

         39. In 2015, Mr. Butcher worked on Gutierrez' case for 26.85 hours. See Case History Report at 1-3 (dated October 19, 2016), filed October 23, 2017 (Doc. 44)(“Case History Report”).

         40. In 2016, Mr. Butcher worked on Gutierrez' case for 87.41 hours. See Case History Report at 4-22.[5]

         41. In total, Mr. Butcher worked 114.26 hours on Gutierrez' case. See Case History Report at 1-22.

         42. For 2015, the CJA billing rate was $127.00 per hour. See Email from Christopher J. Gooch, Financial Services Supervisor, to K'Aun Wild at 1 (dated December 5, 2016)(on file with the Court)(“Billing Email”).

         43. For 2016, the CJA billing rate was $129.00 per hour. See Billing Email at 1.

         44. Based on the CJA rates and hours that Mr. Butcher worked, his services to Gutierrez' case is valued at $14, 685.84. See Case History Report at 1-22; Billing Email at 1.

         45. In addition to Mr. Butcher, another Assistant Federal Public Defender, Dick Winterbottom, worked on Gutierrez' case ...


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