USA v. Shah

Opposition

D. Mass.June 20, 2018

1 UNITED STATES DISTRICT COURT DISTRICT OF MASSACHUSETTS UNITED STATES OF AMERICA ) ) v. ) Case No. 16-cr-10229-IT ) RIAZ ALI SHAH ) ) Government’s Opposition to Defendant’s Motion to Vacate Guilty Plea (Dkt. 67) Shah’s motion to vacate his guilty plea (Dkt. 67) should be denied because all the factors the First Circuit has deemed relevant weigh against him. Shah presents no evidence undermining the Court’s finding that his plea was knowing and voluntarily (he does not even allege that it was not); his motion was filed long after his plea was entered and shortly before his sentencing; his arguments that he is innocent are weak; and his plea was entered pursuant to a negotiated plea agreement that benefited him, decreasing the likelihood that his plea resulted from some sort of coercion or mistake. Moreover, permitting Shah to withdraw his plea now, over a year after he entered it, would prejudice the government, which would have to begin preparations for a trial that it bargained to avoid. Accordingly, Shah cannot establish a fair and just reason his plea should be withdrawn, and his motion should be denied. Background I. Summary of the Offense Conduct As alleged in the Information and recounted in the Presentence Report, between 2008 and 2013, Shah was the manager and 25% owner of a Mattapan takeout restaurant called New York Fried Chicken. See PSR ¶¶ 8–10. The 75% owner of the restaurant was Hazrat Khan, though his ownership interest in the restaurant was concealed in publicly filed documents. See PSR ¶¶ 9–10, New York Fried Chicken only accepted payment in cash, which Shah used to pay employees, Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 1 of 25 2 some of whom were undocumented, and to pay expenses. See PSR ¶¶ 10, 13. Shah kept approximately 25% of the profit for himself and gave the remaining 75% to Khan. PSR ¶ 10. As Shah later admitted during his plea hearing, Khan hired tax preparers for the restaurant, to whom Shah knowingly underreported the restaurant’s revenue, expenses (including payroll), and number of employees between roughly 2008 and 2013. PSR ¶¶ 11–13. As Shah and Khan intended, the result was that the tax preparers prepared and filed inaccurate tax returns that understated the restaurant’s tax liability, fraudulently increasing profit. PSR ¶¶ 13–14. In 2015, in the course of applying for United States citizenship, Shah hid this misconduct from immigration officials. Specifically, he submitted a sworn application in April 2015, which he reaffirmed, under oath, in December 2015, in which he falsely stated that he did not owe any federal, state, or local taxes that were overdue; that he had never committed a crime for which he had not been arrested; and that he had never given false or misleading information to any U.S. government official while applying for an immigration benefit. PSR ¶¶ 15–16. Those falsehoods were material to the adjudication of Shah’s application for citizenship. PSR ¶ 16. II. The Prosecution of Hazrat Khan and His Other Co-Conspirators The first prosecution related to Hazrat Khan’s network of hub-and-spoke tax conspiracies was filed in March 2015, when the government charged Fazal Rubi, an employee at one of Khan’s restaurants, with attempting to procure citizenship contrary to law, along with two related offenses. See Dkt. 1 in United States v. Rubi, No. 15-cr-10186-DPW. In August of that year, Rubi pled guilty to an Information charging him with the naturalization offense. See Dkts. 39, 44. As with Shah, Rubi’s naturalization charge was based on his false answers during the naturalization process, in this instance, answers that falsely hid from immigration authorities that he had not filed tax returns reporting his personal income from the restaurant (where he was paid Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 2 of 25 3 in cash) despite knowing he was obligated to file them. In November 2015, Rubi was sentenced to time served, a matter of a few hours or a day, approximately. See Dkts. 48 (sentencing), 9 (initial appearance). In April 2016, at roughly the same time the government charged Shah by complaint (discussed below), the government indicted Hazrat Khan and a co-conspirator named Khurshed Iqbal for a tax conspiracy that involved two fried chicken restaurants in Boston and Chelsea similar to Shah’s Mattapan store. See Dkt. 1 in United States v. Hazrat Khan, et al., No. 16-cr- 10111-RWZ. At the end of the same month, the government also charged Adalat Khan—another restaurant manager and co-owner—with conspiring with Hazrat Khan to commit tax fraud in connection with a fried chicken restaurant. See Dkt. 1 in United States v. Adalat Khan, No. 16- cr-10120-MLW. Adalat Khan pled guilty to a three-count Information in early June 2016. See Dkt. 10 in Case No. 16-cr-10120-MLW. Just under a year later, in April 2017, the government filed a superseding indictment in Hazrat Khan’s case, adding another restaurant manager and co-owner Rahman Zeb, as a co-defendant. See Dkt. 81 in Case No. 16-cr-10111-RWZ. (Like Shah, Zeb was the informal owner of 25% of a chicken restaurant, with Hazrat Khan owning the other 75%. See id. at ¶ 11.) Later in April 2017, Hazrat Khan pled guilty to a Superseding Information that expanded the charges against him to include tax fraud at eleven restaurants (including Shah’s), visa fraud, and fraud on a worker’s compensation insurance provider. See Dkts. 92–93 in Case No. 16-cr- 10111-RWZ. Khan was eventually sentenced to thirty months’ imprisonment, with restitution of over $2 million. See Dkt. 113 in Case No. 16-cr-10111-RWZ. Also in April 2017, the government filed an Information charging another friend chicken Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 3 of 25 4 restaurant manager and co-owner, Burhan Ud Din, with a tax conspiracy involving Hazrat Khan. See Dkt. 1 in United States v. Din, No. 17-cr-10098-GAO. Although Din signed a plea agreement in April 2017, on the day of his Rule 11 hearing in May 2017, he decided not to plead guilty. See Dkts. 2, 3 in Case No. 17-cr-10098-GAO. The government indicted him for the tax conspiracy in August 2017 and superseded in April 2018 to add a naturalization fraud charge based on Din’s concealment of the tax fraud during his naturalization process. See Dkts. 5, 67 in Case No. 17-cr-10098-GAO. Both Iqbal and Zeb are fugitives; neither has been arrested. Din’s trial is scheduled for October 2018. III. The Prosecution of Riaz Ali Shah Shah was initially charged by complaint and arrested in April 2016. See Dkt. 4 and docket entry dated April 15, 2016. The complaint charged Shah with one of the two crimes to which he eventually pled guilty: knowingly attempting to procure naturalization contrary to law in violation of 18 U.S.C. § 1425(a), by concealing from immigration authorities the tax fraud to which he also later pled. See generally Affidavit of Eric Weindorf (Dkt. 4). Shah was released on conditions, see Dkt. 11, and over the next few months, met with the government multiple times, represented by counsel and assisted by a translator. On August 3, 2016, the government extended Shah a written plea agreement that contemplated Shah pleading guilty to a two-count Information. See Dkt. 32 ¶ 1. The next day, the government filed the Information, charging Shah with a conspiracy to defraud the United States (specifically the Internal Revenue Service), in violation of 18 U.S.C. § 371 (Count One), and with attempt to procure citizenship contrary to law, in violation of § 1425(a) (Count Two). See Dkt. 17. Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 4 of 25 5 Shah pled guilty to both counts during a Rule 11 hearing held March 17, 2017, at which he was again represented by counsel and assisted by an interpreter. See Dkt. 34. During the hearing, as part of a lengthier Rule 11 colloquy, Shah signed a copy of the plea agreement (he had signed one earlier, but the original was not brought to court that day); admitted to the government’s and the Court’s recitation of facts establishing his guilt; and admitted his guilt to both of the crimes charged. See Rule 11 Tr. at 10–11, 28–29. At the end of the hearing, the Court found that Shah was “fully competent and capable of entering an informed plea, that the defendant [was] aware of the nature of the charges and the consequences of the plea and that plea of guilty [was] a knowing and voluntary plea, supported by an independent basis in fact, containing each of the essential elements of the offenses charged.” Id. at 29. The Court therefore accepted the plea and adjudged Shah guilty of both counts. Shah’s presentence report was prepared May 15, 2017 and circulated to counsel. After two weeks, the period for objections closed. Neither Shah nor the government objected to the presentence report. See PSR at 23. The Court initially scheduled Shah’s sentencing for June 15, 2017, see Dkt. 35 at 2, but after several sealed, joint or assented-to motions to postpone it , ultimately rescheduled the sentencing for January 30, 2018. Shortly before that date, however, the Court and the parties learned that Shah’s counsel would be unable to participate for medical reasons. See Dkt. 49. On or about January 19, 2018, the Court Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 5 of 25 6 appointed a new lawyer, Shah’s current counsel, to represent Shah. During a hearing held January 30, 2018, the Court reset Shah’s sentencing for March 13, 2018 in order to allow Shah’s new counsel time to prepare for the hearing. See Dkt. 51. On February 22, 2018, Shah asked for a continuance of unspecified duration, see Dkt. 55, which the Court allowed after a hearing on February 28, see Dkt. 59. Sentencing was rescheduled for April 9. See Dkt. 60. On April 2, Shah again moved to continue the sentencing, this time admitting that the continuance was sought, at least in part, to “marshal sufficient facts to persuade this Court that he has shown a sufficiently fair and just reason to warrant withdrawal of his guilty plea.” Dkt. 62 at 8. Over the government’s opposition (Dkt. 63), the Court granted the motion and rescheduled the sentencing for May 24, 2018. See Dkt. 64. Eight days before that date arrived, however, on May 16, 2018, Shah filed a motion to vacate his guilty plea. See Dkt. 64. In his motion and its supporting affidavits, Shah claims he is innocent of the charges in the Information and suggests variously—without ever explicitly asserting—that his plea was the product of ineffective legal counsel or of some other, unspecified sort of misunderstanding or mistake. See Motion (Dkt. 67) at 2; see also R. Shah Aff. (Dkt. 67-5) ¶ 29 (claiming innocence). As argued below, all of the factors identified by the First Circuit as relevant to this kind of motion weigh against granting Shah’s motion. Legal Standard “[A] defendant has no absolute right to withdraw his guilty plea.” United States v. Ramos-Mejia, 721 F.3d 12, 14 (1st Cir. 2013). A defendant in Shah’s position—one whose guilty plea has been accepted but on whom sentence has not yet been imposed—may withdraw Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 6 of 25 7 his guilty plea only if he “can show a fair and just reason for requesting the withdrawal.” Fed. R. Crim. P. 11(d)(2)(B). As the rule implies, “[t]he burden rests with the defendant to make this showing.” United States v. Caramadre, 807 F.3d 359, 366 (1st Cir. 2015). “The district court must consider several factors in determining whether the burden of persuasion has been met by the defendant, the most significant being whether the plea was voluntary, intelligent and knowing, within the meaning of Rule 11.” United States v. Marrero- Rivera, 124 F.3d 342, 347 (1st Cir. 1997); accord Caramadre, 807 F.3d at 366 (“Critical to the plea-withdrawal inquiry is whether the original guilty plea was knowing, intelligent, and voluntary.”). Though this factor is the most important, the Court may consider others, including: (1) the plausibility and weight of the reason given for the withdrawal, (2) the timing of the request, (3) whether the defendant is now colorably asserting legal innocence, and (4) whether the original plea was pursuant to a plea agreement. Caramadre, 807 F.3d at 366 (quoting United States v. Aker, 181 F.3d 167, 170 (1st Cir. 1999)). “If these factors, taken together, tilt in favor of allowing withdrawal, the court must then weigh the prejudice that the government would suffer if the plea were to be vacated. Caramadre, 807 F.3d at 366; accord United States v. Fernández-Santos, 856 F.3d 10, 15 (1st Cir. 2017). The prejudice to the government may provide a reason to decline a motion for withdrawal of a plea even when the other factors suggest the plea could be withdrawn. Argument I. The Factors Discussed by the First Circuit Weigh Against Withdrawal of the Plea All the factors identified by the First Circuit weigh against permitting Shah to withdraw his plea now. Below, the government addresses each factor in turn. Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 7 of 25 8 A. Shah’s Guilty Plea Was Knowing, Intelligent, and Voluntary As the First Circuit has repeatedly emphasized, the first and most important factor to consider is whether the defendant’s guilty plea was knowing, intelligent, and voluntary within the meaning of Fed. R. Crim. P. 11. See, e.g., United States v. Sanchez-Barreto, 93 F.3d 17, 23 (1st Cir. 1996) (calling this assessment “the most prominent single factor” in evaluating whether to permit withdrawal of a plea). As the Court already found during the Rule 11 hearing in March 2017, Shah’s plea met all those criteria; nowhere in his motion or supporting documents does Shah even assert the contrary. The Court may deny his motion to withdraw his plea on these bases alone. 1. The Court Scrupulously Followed Fed. R. Crim. P. 11 at the Change-of-Plea Hearing In a colloquy lasting approximately an hour at which Shah was represented by counsel, assisted by an interpreter, and under oath (Rule 11 Tr. at 4), the Court questioned Shah about his understanding and acceptance of the day’s proceedings, then accepted Shah’s change of plea. In its colloquy, the Court addressed Shah’s age and level of education (Rule 11 Tr. at 4–5); his mental and psychological state (id. at 5); whether Shah was taking medications (id.); whether he had discussed the day’s proceedings with his counsel (id. at 6); whether he was satisfied with his counsel (id.); whether someone had read Shah the plea agreement in his native language, and whether Shah understood it (id. at 8–12); whether Shah had been threatened, pressured, or induced to plead guilty (id. at 12); whether Shah understood the consequences of pleading guilty, including the possible penalties and immigration consequences of that decision (id. at 12–15; ); the functioning and non-binding quality of the Sentencing Guidelines (Rule 11 Tr. at 15–17); the waiver of Shah’s trial rights Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 8 of 25 9 entailed by a guilty plea (id. at 17–18); the rights to appeal that Shah abandoned under the plea agreement (id. at 19); the elements of the offenses charged (id. at 20–21); the factual basis for the pleas and the factual justification for that basis (id.at 21–28). After receiving satisfactory answers to all these inquiries, the Court asked Shah how he wished to plead to the two counts in the Information. Following Shah’s answer—“Guilty”—the Court found that his plea was knowing and voluntary, then accepted the plea, stating as follows: The Court finds that the defendant is fully competent and capable of entering an informed plea, that the defendant is aware of the nature of the charges and the consequences of the plea and that the plea of guilty is a knowing and voluntary plea supported by an independent basis in fact, containing each of the elements of the offense charged. The plea is therefore accepted, and the defendant is now adjudged guilty of these offenses. Rule 11 Tr. at 29. The Court’s colloquy with Shah comported with the requirements of Fed. R. Crim. P. 11(b), which should be the principal concern when a court considers a motion to withdraw a guilty plea. See, e.g., Caramadre, 807 F.3d at 367 (“Rule 11 considerations are a paramount concern in a plea-withdrawal inquiry.”); see also United States v. Cotal-Crespo, 47 F.3d 1, 4 (1st Cir. 1995) (noting that the “core concerns” of Rule 11 are “1) absence of coercion; 2) understanding of the charges; and 3) knowledge of the consequences of pleading guilty”). The transcript of the Rule 11 hearing reflects no concerns on the Court’s part that Shah did not understand what was happening or that he was being coerced or pressured in any way by his counsel or by the government. On the contrary, after observing Shah’s demeanor, his answers throughout the hearing, and his interactions with defense counsel, the Court found that his guilty plea was knowing and voluntary. In a case like this, a defendant’s attempt to withdraw his plea should be denied. See, e.g., Sanchez-Barreto, 93 F.3d at 23 (“We have found no abuse of discretion in disallowing plea withdrawal motions where Rule 11 safeguards were scrupulously Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 9 of 25 10 followed by the district court.”). This conclusion is strengthened by the fact that Shah does not explicitly challenge the Court’s findings that his plea was knowing and voluntary, though he is at pains to suggest that it was not. In his affidavit, for example, Shah states that, before the Rule 11 hearing, his counsel told him that, “if [he] did not understand anything the judge asked, to agree with her.” R. Shah Aff. ¶ 29. Shah’s son recounts a more ominous version of this exchange, stating that Shah’s counsel told Shah, “Just say yes to any of the judge’s questions and agree with what she says. You have to accept everything.” F. Shah Aff. (Dkt. 67-20) ¶ 20. But Shah never asserts that he actually misunderstood anything the Court asked during the Rule 11 colloquy, or that he knowingly answered any question falsely as a result of his counsel’s alleged instructions. This Court should not overturn its finding that his plea was knowing and voluntary when Shah himself has not even asserted that the finding was incorrect. 2. Shah’s Plea Was Not Tainted By Ineffective Assistance of Counsel Nor should the Court accept the implication in Shah’s filings—again, never made explicit—that his guilty plea was the result of ineffective legal counsel at the plea stage. See, e.g., Motion (Dkt. 67) at 4–5. Shah has neither demonstrated that his counsel was deficient nor that Shah would have insisted on going to trial had he received better legal advice. If a defendant wishes to withdraw his plea based on alleged ineffective assistance of counsel, he “must demonstrate that counsel’s performance fell below an objective threshold of reasonable care and that this deficient performance prejudiced him,” a requirement that, in turn, requires “a showing of a reasonable probability that, but for counsel’s errors, he would not have pleaded guilty and would have insisted on going to trial.” Caramadre, 807 F.3d at 371 (internal quotation marks omitted). A lawyer’s “alleged ineffectiveness is only relevant to the extent it Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 10 of 25 11 affected [the defendant’s] decision to plead guilty.” Id. Shah’s motion and supporting affidavits do not come near to establishing either that he received deficient representation or that, with better counsel, he would have insisted on going to trial. The evidence against Shah that was available to his counsel pre-plea was considerable. As recounted in the complaint affidavit, employees at Shah’s restaurant had told the government that Shah was part owner of the restaurant and handled its operations, and the restaurant’s tax preparers had told the government that Shah provided the figures for the restaurants tax returns, on which income and payroll were understated. See Weindorf Aff. (Dkt. 4-1) ¶¶ 8, 13–14. A comparison of the restaurant’s tax returns to the restaurant’s accurate records, which were seized in a July 2013 search, showed that, for years, the restaurant’s gross receipts and expenses were significantly underreported. See id. ¶¶ 10, 13. Shah himself had given multiple interviews to the government in 2013 in which he made inculpatory admissions, including that his restaurant’s tax returns were false, that he kept two sets of accounting books for the restaurant—one accurate, one false—and that he may not have reported all of his income on his personal income tax returns. See id. ¶¶ 7, 9–10. In addition, Shah’s prior counsel also attended at least two proffers with the government at which he listened to Shah make further admissions. Finally, Shah’s counsel could see that, roughly simultaneously with Shah’s charge by complaint, the government had indicted both Hazrat Khan and Khurshed Iqbal for tax offenses at two of Khan’s other restaurants. See Dkt. 1 in United States v. Khan, et al., No. 16-cr-10111-RWZ. In light of this state of affairs, it would have been reasonable for Shah’s lawyer to advise Shah to enter into a plea agreement with the government, as the government assumes Shah’s lawyer did. The prudence of that choice is especially evident where, as in this case, there were benefits associated with a speedy confession: Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 11 of 25 12 Whether or not Shah’s current counsel would have made the same decisions at the time— —the decisions were reasonable, not ineffective. Cf. Strickland v. Washington, 466 U.S. 668, 690 (1984) (“[A] court deciding an actual ineffectiveness claim must judge the reasonableness of counsel’s challenged conduct on the facts of the particular case, viewed as of the time of counsel’s conduct.”). Strategic decisions of that kind are entitled to “a heavy measure of deference,” and a reviewing court “should recognize that counsel is strongly presumed to have rendered adequate assistance and made all significant decisions in the exercise of reasonable professional judgment.”1 Id. at 690–91. In this instance, the Court should be particularly reluctant to reexamine the choices made by Shah’s prior counsel because Shah has provided almost no evidence regarding what advice he actually received.2 Whatever Shah is now telling his current counsel, Shah provides no evidence 1 2 There are clear two exceptions. One appears in a two-sentence account of a conversation shortly after Shah’s arrest in which Shah’s counsel seems accurately to have assessed Shah’s litigation risk and suggested a prudent option for dealing with it. See F. Shah Aff. (Dkt. 67-20) ¶ 13; see also R. Shah Aff. ¶ 28 (alleging, without identifying a speaker: “I was only told that things would go better if I cooperated”). The other, discussed above, is the allegation that, just before the Rule 11 hearing, Shah’s lawyer told him that he should simply agree to statements made or questions put to him during the hearing. See Shah Aff. ¶ 29; F. Shah Aff. (Dkt. 67-20) Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 12 of 25 13 about what he admitted or related to his former counsel—facts that are highly relevant to both the lawyer’s assessment of the case against Shah and to Shah’s best options at that stage in the government’s case against him. Cf. Strickland, 466 U.S. at 691 (“[W]hen a defendant has given counsel reason to believe that pursuing certain investigations would be fruitless or even harmful, counsel’s failure to pursue those investigations may not later be challenged as unreasonable.”). The burden is on Shah to provide evidence establishing that his counsel acted unreasonably in advising him to plead guilty in 2017, and Shah has not provided any. In places, Shah suggests that his prior counsel conducted an inadequate investigation, but his purported examples of this are poor, and he once again falls short of providing evidence to support his claim. Shah implies, for example, that his former counsel was deficient for letting Shah plead guilty without first requesting that the government produce copies of Shah’s individual tax returns. See Motion (Dkt. 67) at 4–5. But Shah’s individual tax returns were never the focus of the charges against him; the important tax filings were those submitted for Shah’s restaurant. See Information (Dkt. 17) ¶ 23 (alleging that Shah conspired to defraud the government in connection with “employment taxes and corporate income taxes associated with [New York Fried Chicken]”). In any event, Shah admits in his affidavit that he himself ¶ 20. This allegation should not be accepted by the Court. First, the two accounts of the lawyer’s advice (one from Shah and one from his son) conflict, making each account less likely to be true. Second, they stand at odds with the way Shah’s lawyer presented himself in the Rule 11 hearing transcript, where the transcript suggests he was both attentive (see, e.g., Rule 11 Tr. at 24–25) and cognizant of his client’s limitations ( ). The discrepancies should not be surprising. The motivations for Shah and his son to lie in their affidavits is obvious, particularly here, where Shah’s former counsel is incapacitated and unable to rebut false allegations about his conduct. It is also possible that Shah and his son simply misunderstood or misinterpreted something Shah’s lawyer said on their way into the courtroom; often, the final advice a lawyer gives his client—especially an unsophisticated or uneducated client—just before a Rule 11 hearing is more condensed, more practically oriented, and less nuanced than discussions they had previously, when the decision to plead guilty was actually made. Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 13 of 25 14 maintained copies of his individual tax returns, see R. Shah Aff. ¶ 14(l), making the timing of their production by the government irrelevant to an assessment of his counsel’s performance; if Shah’s counsel had needed to see Shah’s individual tax returns, they were available to him. For both those reasons, the fact that Shah’s current counsel may have been the first to request Shah’s individual tax returns does not “suggest[] the existence of a significant problem.” Motion at 4. Those returns were of little importance to Shah’s guilt or innocence of the charges against him. To suggest that Shah might have had defenses he could have raised at trial (namely, that Khan acted alone, with Shah’s unwitting help) stops far short of proving it was unreasonable for Shah’s counsel to advise him to plead guilty. Nearly all defendants have some defense they could raise at trial. That is what they give up when they plead guilty. Defendants are not permitted to withdraw their pleas, however, simply because they later rethink that decision. See, e.g., United States v. Muriel, 111 F.3d 975, 981 (1st Cir. 1997) (“This court has not allowed defendants, absent coercion or mistake, to renege on plea agreements on the basis that they have miscalculated their risks and benefits or have belatedly discovered a new defense.”); see also Brady v. United States, 397 U.S. 742, 757 (1970) (“A defendant is not entitled to withdraw his plea merely because he discovers long after the plea has been accepted that his calculus misapprehended the quality of the State’s case.”). As the First Circuit has found, “when a defendant pleads guilty and later tries to withdraw his plea, the ineffective assistance of counsel inquiry must focus on his lawyer’s preparation, advice, and overall performance in counseling the defendant about whether to plead guilty.” Caramadre, 807 F.3d at 371. Here, Shah has told the Court almost nothing about each of these factors, nor has he explained why, given better advice, he would have elected to proceed to trial despite the evidence against him (another relevant factor). See id. at 371–72; see also United Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 14 of 25 Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 15 of 25 16 later, contradictory claims. Santiago Miranda, 654 F.3d at 138. At Shah’s Rule 11 hearing, he accepted the government’s and the Court’s recitation of facts in their entirety after acknowledging that he understood them, and he admitted that he was, in fact, guilty of both charges against him. See Rule 11 Tr. at 27–28. The facts to which he admitted included, among other things: that he was a 25% owner of the restaurant he managed; that he was responsible for hiring and firing employees at the restaurant; that the restaurant operated in cash; that Shah did not provide employees with IRS Forms W-2; that Shah maintained accurate records of the restaurants sales and expenses, but did not provide them to the store’s tax preparers; that Shah was aware the restaurant’s tax returns were false because they underreported income and certain expenses; and that Shah knowingly provided false information concerning this conduct in his sworn application for naturalization to the United States. See id. at 21–27. As the Court correctly found, these facts are more than sufficient to meet the elements of the charged offenses. See id. at 29. In his motion to withdraw his plea, however, Shah denies many of the facts to which he earlier admitted. He now claims, for instance, he did not provide business information to his restaurant’s tax preparers during the years relevant to the Information. See R. Shah Aff. ¶ 14.j. He says he was not a part owner of the restaurant and that he had no real control over it, including over hiring and firing decisions. See id. ¶¶ 14.c, 17, 18. He asserts that he “genuinely believed” the answers he provided in his naturalization application “were true and correct.” See id. ¶ 24. The Court should reject these and other newly voiced contentions that conflict with Shah’s sworn admissions during the Rule 11 hearing.3 “Ordinarily, a defendant is stuck with the 3 The government’s disagreement with the factual allegations in Shah’s affidavit, his son’s, and Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 16 of 25 17 representations that he himself makes in open court at the time of the plea.” United States v. Padilla-Galarza, 351 F.3d 594, 598 (1st Cir. 2003); see also Blackledge v. Allison, 431 U.S. 63, 74 (1977) (“[D]eclarations in open court carry a strong presumption of verity.”). This is for good reason: those in-court statements “are more likely to be reliable than later versions prompted by second thoughts, and guilty pleas—often in the defendant’s interest—could hardly be managed any other way.” Padilla-Galarza, 351 F.3d at 598. Against the presumption that his Rule 11 admissions were truthful, Shah offers no independent evidence corroborating his new version of the facts, giving the Court no reason to accept them. His assertion, for example, that he did not sign certain tax authorization documents until long after they had been filed with the IRS, see, e.g., R. Shah Aff. ¶ 14k, Motion at 4, even if accepted, does not negate his earlier admissions that he knowingly participated in a conspiracy to file substantive tax returns that were false.4 Backdating the authorization forms5 could be consistent with multiple explanations that have no bearing on Shah’s guilt or innocence, among the motion submitted by his counsel do not end with this list, but because many of them are not important to the pending motion (the description of the search of Shah’s residence, for example), the government does not list them all here. The same is true of disagreements over irrelevant legal points, including whether Shah is a responsible person within the meaning of the tax law. See Motion (Dkt. 67) at 7 (asserting that Shah is not a “responsible person”). This designation matters in certain civil and criminal cases in which the government must prove that the defendant owed a duty to collect, account for, or pay over a particular tax, as in prosecutions under 26 U.S.C. § 7202. It is not an element of either of the crimes to which Shah pled guilty, however, and the government had no obligation to prove it. Whether or not the government agrees that Shah was not a “responsible person,” therefore, is not relevant to Shah’s motion to withdraw his plea. 4 The Court need not accept the assertion that these documents were backdated. In an interview with the government in May 2016 at which Shah was represented by counsel, Shah was shown the documents and confirmed that they bore his signature, yet it was only “[m]ore recently” that Shah informed his new attorney that the documents were backdated. R. Shah Aff. ¶ 14.k.ii (at page 5). 5 IRS Forms 8879, which document a taxpayer’s authorization to let a tax preparer to file taxes electronically on his behalf. Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 17 of 25 18 them: sloppy tax preparers who did not collect the forms when they should have, despite receiving timely verbal authorization to file from Shah; tax preparers who timely collected the forms but later lost them and sought replacements; or even tax preparers who were themselves participants in or willfully blind to the fraud Shah and Khan were committing, wishing to fraudulent paper their files.6 To make his pitch for innocence, Shah now recasts himself as Hazrat Khan’s dupe— someone who had no idea he was listed as owner the restaurant in Massachusetts organizational documents, no idea what tax returns were being filed under his apparent authority, no idea whether information was correctly being reported to the IRS, and no understanding of the tax laws of the United States. That portrayal is inconsistent with the evidence, particularly when Shah’s case is considered as part of the larger series of prosecutions brought against Hazrat Khan and the four other managers in positions analogous to Shah (one of whom, Adalat Khan, has also pled guilty for his role in the fraud at two restaurants). There are also internal implausibilities in Shah’s new account, including Shah’s professed ignorance that he was identified as a company officer in Massachusetts organizational documents when he simultaneously admits to establishing a business bank account for the restaurant using what he says is a fraudulent Business Certificate that identified him as the person who established the business. Compare R. Shah Aff. ¶ 14f with id. ¶ 20. As described in the government’s sentencing memorandum in the Hazrat Khan prosecution, Khan’s tax fraud followed a pattern at the various restaurants he co-owned, 6 To be clear, the government is not endorsing any of these alternatives. It lists them here merely to illustrate how the request to backdate these authorization forms might, indeed, have been meant to “‘pad’ the preparer’s file” (Motion at 4) yet not be probative of Shah’s guilt or innocence. Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 18 of 25 19 including Shah’s, which was a typical example. See Dkt. 110 at 3–6 in United States v. Khan, et al., No. 16-cr-10111-RWZ. That pattern included instructing managers and co-owners like Shah to maintain accounting notebooks documenting revenue and expenses without showing those figures to the tax preparers for the stores, who were fed falsely low figures to report on the restaurants’ tax filings. See id. at 4–5. During searches conducted in 2013, the government recovered accounting notebooks for eleven of these restaurants. The notebooks were all similar in layout and content, and they included the ones Shah admits he maintained at New York Fried Chicken. On the basis of those notebooks and on additional evidence, including statements from employees, tax preparers, and co-conspirators, the government has charged four other managers or co-owners in positions analogous to Shah with parallel tax conspiracies in separate criminal cases.7 Against that evidence and the weight of his own sworn admissions at the Rule 11 hearing, Shah offers only his new sworn statements, which contradict them. That showing is insufficient to establish his innocence. See United States v. Kobrosky, 711 F.2d 449, 455 (1st Cir. 1983) (“[T]he mere protestation of legal innocence cannot in and of itself be issue-determinative, for ‘[t]here are few if any criminal cases where the defendant cannot devise some theory or story which, if believed by a jury, would result in his acquittal.’”). Given the procedural posture of his case, his credibility is inherently suspect. See Padilla-Galarza, 351 F.3d at 598. What little credibility remains is further undermined by the inherent implausibility of his new assertions.8 7 They are Khurshed Iqbal, Rahman Zeb, Burhan Ud Din, and Adalat Khan. As reported in the background section above, Iqbal and Zeb are fugitives. Adalat Khan has pled guilty. Din is scheduled for trial in October before Judge O’Toole. 8 Consider, for instance, Shah’s explanation for maintaining a set of inaccurate accounting notebooks for his restaurant, and for what he told law enforcement agents about those notebooks when interviewed (two of the few inculpatory facts he does not now deny). In his affidavit, Shah claims that he maintained a false set of accounting notebooks, not with the Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 19 of 25 20 C. The Timing of Shah’s Motion Suggests That a Desire to Avoid Punishment Motivates Its Filing As a means to assess the merit of a defendant’s motion to withdraw his guilty plea, the Court may also look to the time at which the motion is filed. See, e.g., Caramadre, 807 F.3d at 366. Here, the timing of Shah’s motion suggests the motion was motivated by a desire to avoid punishment, not to vindicate him. Consequently, the timing also weighs against permitting him to withdraw his plea. As the First Circuit has explained, “[t]he timing of a motion to withdraw a guilty plea is important . . . because it is ‘highly probative of motive.’” Fernández-Santos, 856 F.3d at 18 (quoting United States v. Doyle, 981 F.2d 591, 595 (1st Cir. 1992)); see also United States v. Parrilla-Tirado, 22 F.3d 368, 373 (1st Cir. 1994) (“The timing of a motion to withdraw a guilty purpose of obstructing a potential audit or IRS inquiry, but in order to dampen interest from potential buyers who might want to purchase the restaurant and oust him as manager, leaving him unemployed. See generally R. Shah Aff. ¶ 19.d.v. (Dkt. 67-5 at pages 8–11). The false books, Shah explains, were the result of a friendly suggestion from Khurshed Iqbal (another indicted co-conspirator of Hazrat Khan’s), and they “understated gross receipts and made Store 1251 in general appear less profitable than it actually was all for the purpose of chilling any interest in the business.” Id. ¶ 19.d.v.i (at page 10). Despite this explanation for the existence of the false books—not a completely innocent one, but one unrelated to tax fraud, at least—Shah never mentioned it to the IRS agents who interviewed him prior to his guilty plea. See ¶ 19.d.v (at page 8). He only mentions the explanation now because he has “become enlightened in connection with preparing this individual affidavit.” Id. at ¶ 19.d.v.b (at page 8). These assertions are incredible. Among other reasons, Shah makes no attempt to explain why it was necessary to maintain records that falsely understated profitability during a period when he also claims that “[b]usiness at the store had been slow and receipts were down and [ ] Khan had depleted the capital of the business by being overly generous to himself.” R. Shah Aff. ¶ 19.d.v.d (at page 9). Presumably a truthful accounting of the restaurant’s finances would have been discouraging enough to would-be purchasers. See also Defendant’s Sentencing Memorandum (Dkt. 98) at 6 in United States v. Hazrat Khan, et al., No. 16-cr-10111-RWZ (admitting that the tax fraud at the restaurants involved in Khan’s tax conspiracies “often mean the difference between making money and losing money”). And second, it defies credulity that Shah would not have raised this explanation for the books earlier given that he was the one who volunteered information about the existence of the inaccurate books, and did so while being questioned by an IRS agent about the filing of inaccurate tax returns concerning his restaurant. Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 20 of 25 21 plea is significant.”). “The rule of thumb is that the longer a defendant waits before moving to withdraw his plea, the more potency his motion must have in order to gain favorable consideration.” Parrilla-Tirado, 22 F.3d at 373. “While an immediate change of heart may well lend considerable force to a plea withdrawal request, a long interval between the plea and the request often weakens any claim that the plea was entered in confusion or under false pretenses.” Doyle, 981 F.2d at 595 (quoted with approval in Fernández-Santos, 856 F.3d at 18). Even a delay of just a few weeks can be too long, indicative of a defendant motivated by something other than a genuine identification of a fair and just reason why his plea should be annulled. See, e.g., United States v. Ramos, 810 F.2d 308, 313 (1st Cir. 1987) (delay of thirteen days too long); United States v. Kobrosky, 711 F.2d 449, 456 (1st Cir. 1983) (three weeks); Nunez Cordero v. United States, 533 F.2d 726 (1st Cir. 1976) (two weeks). Here, Shah’s motion to withdraw his plea came over a year after his plea was entered, on the eve of his long-delayed sentencing. The proximity to the sentencing, as much as the remoteness from the plea hearing, suggests that the true motive behind the motion was to escape the punishment associated with Shah’s crimes, which include potential deportation.9 This motive counsels against permitting Shah to withdraw his plea. It does not help Shah that a shorter period elapsed between obtaining new counsel and filing the motion to withdraw the plea; the four months it took for his new counsel to file the 9 In his motion, Shah asserts that “[a] defendant charged with a crime must be fully apprised regarding the risk of deportation,” (Motion at 6), implying that Shah was not. This suggestion is contradicted by the plea colloquy, during which the defendant was apprised of the potential for removal and acknowledged he understood it, see Rule 11 Tr. at 13; , and by the plea agreement, which warns the defendant explicitly that pleading guilty may have immigration consequences and that, “[u]nder federal law, a broad range of crimes are removable offenses, including the offenses to which Defendant is pleading guilty,” Dkt. 32 ¶ 2. Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 21 of 25 22 motion was long enough to count against him.10 See Fernández-Santos, 856 F.3d at 20 (“[The defendant] moved to withdraw his plea two months after getting a new lawyer (and seven months after pleading guilty), so his timing weighs against him, too.”). If anything, the filing of the motion after the appointment of new counsel—and the incapacitation of Shah’s prior counsel—only emphasizes that the motion was motivated by opportunity, not Shah’s alleged innocence. D. Shah Pled Guilty Pursuant to a Plea Agreement Another factor relevant to the Court’s assessment of Shah’s motion—whether Shah pled pursuant to a plea agreement—also favors leaving the plea intact. Shah pled guilty in accordance with a plea agreement that was negotiated by his counsel, . The existence of the plea agreement decreased the risk that Shah’s plea was unfairly or unjustly entered and buttresses the many other reasons his plea should stand. II. Withdrawal of Shah’s Plea Would Prejudice the Government Substantially Even if the other factors identified by the First Circuit weighed in favor of permitting Shah to withdraw his plea, the Court should reject Shah’s motion because permitting withdrawal would prejudice the government substantially, another factor the Court must consider. See, e.g., Fernández-Santos, 856 F.3d at 15. Shah pled guilty over a year ago, in March 2017, to crimes committed between 2008 and 2013 and first charged in 2016. If Shah were permitted to 10 This is not to suggests that Shah’s new counsel was not diligent or in any way to blame for the negative inference. On the contrary, the length of time it took diligent counsel to assess, prepare, and file the motion is a reflection of the motion’s lack of merit. A fair and just reason for withdrawing the plea ought immediately to be apparent, not so deeply hidden that it takes four months to suss it out and identify evidence to support it (especially where that evidence ultimately consists of little more than an affidavit from the defendant). Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 22 of 25 23 withdraw his plea now, his case likely would not be tried until sometime in 2019, probably late in 2019. See U.S. Courts Federal Management Statistics Report (March 2018) (listing median durations exceeding one year for criminal felony trials in Massachusetts for most years dating back to 2013), available at http://www.uscourts.gov/sites/default/files/data_tables/ fcms_na_distprofile0331.2018.pdf. Before even reaching trial preparation, the government— now represented by a prosecutor who did not participate in the investigation of this case—would need to produce automatic discovery (not produced here because the defendant pled guilty pre- indictment) and respond to any additional discovery requests. In addition, the defendant may wish to file motions to suppress evidence or dispositive motions under Fed. R. Crim. P. 12, to which the government would also need to respond. Once trial were eventually reached, the government’s case would be prejudiced by the pretrial delay, which will have eroded witnesses’ memories, and by the likelihood that some of the witnesses against Shah will be unavailable, either because they could not be located or because they have been deported. (As Shah knows, some of the employees at his restaurant were undocumented immigrants.) In addition, the government would be prejudiced at trial by the restricted ability to bring additional charges against the defendant now that so much time has passed since he committed his crimes. Most of those charges—which might include substantive tax charges against Shah under, for example, 26 U.S.C. §§ 7202 or 7206(1)—now fall outside even the six-year statute of limitations for tax fraud charges. Compare 26 U.S.C. § 6531 (setting six-year statute of limitations) with Information Count One (alleging a conspiracy running from 2008 until January 2013). In a typical, contested prosecution, the government might include a variety of substantive counts to protect against the possibility of dismissal on technical grounds and to increase the likelihood of conviction at trial. Those protections were unnecessary when Shah’s case was Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 23 of 25 24 initially charged because he had agreed to plead guilty. Conclusion All of the faults with Shah’s motion to withdraw his plea are of a piece: His guilty plea was made and accepted after a thorough examination by the Court at which Shah admitted, under oath, to the accuracy of facts sufficient to find him guilty, and at which the Court found that Shah’s guilty plea was made knowingly, intelligently, and voluntarily. His motion to withdraw that plea was filed after a long delay, even allowing for his change in counsel, and his claim of actual innocence is weak. His attacks on his former lawyer lack credibility, as do his other factual assertions, which are almost wholly based on his own, self-serving affidavit. All these factors suggest his attempt to withdraw his plea is opportunistic, not meritorious. Whatever the motivation, permitting Shah to withdraw his plea would substantially prejudice the government, which would be significantly disadvantaged at a trial it bargained with Shah to avoid. All of these are reasons to deny the motion. There is no indication in this case that Shah’s guilty plea was coerced or “entered in confusion or under false pretenses.” Fernández-Santos, 856 F.3d at 18. Rather, the impression created by the motion and the leadup to it is of a simple re-assessment by Shah’s new counsel of the wisdom of Shah’s guilty plea given the consequences, including the possibility that Shah will be deported after serving whatever sentence is imposed. Doubtless Shah’s current counsel is encouraged in that re-assessment by a client who no longer wishes to face the consequences of the bargain he struck, consequences that have thus far been delayed successfully. But that bargain was considered by both sides, examined carefully by the Court, and found to be just. The Court should hold the defendant to it and deny Shah’s motion to vacate his guilty plea. Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 24 of 25 25 Respectfully submitted, ANDREW E. LELLING United States Attorney Dated: June 20, 2018 By: /s/ Brian A. Pérez-Daple BRIAN A. PÉREZ-DAPLE Assistant U.S. Attorney U.S. Attorney’s Office U.S. Courthouse, Suite 9200 Boston, MA 02210 (617) 748-3100 CERTIFICATE OF SERVICE I hereby certify that this document, filed through the ECF system, will be sent electronically to the registered participants as identified on the Notice of Electronic Filing. /s/ Brian A. Pérez-Daple Assistant United States Attorney Case 1:16-cr-10229-IT Document 76 Filed 06/20/18 Page 25 of 25