TABLE OF CONTENTS
Table of Contents i
Table of Authorities iii
Constitutional Provisions & Statute Involved viii
Statement of Jurisdiction ix
Issues Presented for Review x
Statement of the Case 1
Statement of Facts 3
Summary of Argument 25
Argument 28
I. Standard of Review 28
II. The Prosecutors’ Repeated Misrepresentations Concerning an Issue Central to Cohen’s Defense, Which Caused the Court to Instruct the Jury to Disregard Cohen’s Previously Admitted Testimony, Deprived Cohen of His Fundamental Right to a Fair Trial and Require Reversal of His Conviction 28
A. The Misrepresentations of the Trial Prosecutors Constituted
Inexcusable Misconduct 28
B. The Improper Misrepresentations of the Trial Prosecutors Deprived Cohen of His Fundamental Right to a Fair Trial, Including a Fair Opportunity to Be Heard and to Testify in his Own Defense. 32
C. The Deprivation of Cohen’s Due Process Rights Infected the Integrity and Structure of the Entire Trial and Require Reversal of Cohen’s Conviction 38
D. Even if the Deprivation of Cohen’s Due Process Rights are not Deemed Structural Errors, They Were Not Harmless and the Writ of Habeas Corpus Should be Granted 42
III. Cohen was Part of a Particular Class of Persons Targeted for Selective Prosecution Under the Wire Act in Violation of His Right to Equal Protection as Guaranteed by the Due Process Clause of the Fifth Amendment 47
A. The Government May Not Selectively Apply the Law to a Certain Class of Persons While Declining to Prosecute Others Similarly Situated 47
B. The Government Has Created An Arbitrary Distinction Between Persons Offering Wagering on NFL, NHL, NBA, and Major League Baseball Games and Those Offering Wagering on All Other Sports and Horse Racing.. 49
C. The Government’s Selective Prosecution of Cohen Was
Motivated By Discriminatory Intent 51
D. Cohen Has Made a Prima Facie Showing of Selective Prosecution Which Entitles Him to Discovery and a Hearing. 55
Conclusion 57
Certificate of Compliance 59
Certificate of Service 60
TABLE OF AUTHORITIES
Federal Cases
Alicea v. Gagnon, 675 F.2d 913 (7th Cir. 1982) 35
Arizona v. Fulminate, 499 U.S. 279 (1991) 38
Bains v. Cambra, 204 F.3d 964 (9th Cir. 2000) 44
Barber v. Johnson, 145 F.3d 234 44
Bolling v. Sharpe, 347 U.S. 497 (1954) 52
Brecht v. Abrahamson, 507 U.S. 619 (1993) 42, 43
Brewer v. Reynolds, 51 F.3d 1519 (10th Cir. 1995) 44
Brown v. Artuz, 124 F.3d 73 (2d Cir. 1997) 33
C.E. Carlson, Inc. v. SEC, 859 F.2d 1429 (10th Cir. 1988) 55
California v. Trombetta, 467 U.S. 479 (1984) 32
Campino v. United States, 968 F.2d 187 (2d Cir. 1992) 37
Chambers v. Mississippi, 410 U.S. 284 (1973) 32
Conde v. Henry, 198 F.3d 734 (9th Cir. 2001) 42
Crane v. Kentucky, 476 U.S. 685 (1986) 32
Gideon v. Wainwright, 372 U.S. 335 (1963) 38
Gilliam v. Mitchell, 179 F.3d 990 (6th Cir. 1999) 44
Grannis v. Ordean, 234 U.S. 385 (1914) 32
Hassine v. Zimmerman, 160 F.3d 941 (3d Cir. 1998) 44
Hogue v. Johnson, 131 F.3d 466 (5th Cir. 1997) 44
Horsley v. Alabama, 45 F.3d 1486 (11th Cir. 1995) 44
In Re Oliver, 333 U.S. 257, 273 (1948) 32
Lyons v. Johnson, 912 F. Supp. 679, 687-89 (S.D.N.Y.),
aff'd on other grounds, 99 F.3d 499 (2d Cir. 1996) 45
MacKenna v. Ellis, 280 F.2d 592 (5th Cir. 1960),
modified, 289 F.2d 928 (5th Cir. 1961) (en banc) 32
Marrero Pichardo v. Ashcroft, 374 F.3d 46 (2d Cir. 2004) 28
Martinez v. Ylst, 951 F.2d 1153 (9th Cir. 1991) 40
McKaskle v. Wiggins, 465 U.S. 168 (1984) 38
Monsanto v. United States, 143 F. Supp. 2d 273 (S.D.N.Y. 2001) 45
Orndorff v. Lockhart, 998 F.2d 1426 (8th Cir. 1993) 43, 44
Owens v. United States, 236 F. Supp. 2d 122 (D. Mass. 2002) 41
Oyler v. Boles, 368 U.S. 448 (1962) 51, 54
Rock v. Arkansas, 483 U.S. 44 (1987) 33, 35
Romero v. United States, No. 00 Civ. 3513 (RPP), 2001 WL 921167,
at *5 (S.D.N.Y., Aug. 15, 2001) 45
Rose v. Clark, 478 U.S. 570 (1986) 38
Santana-Madera v. United States, 260 F.3d 133 (2d Cir. 2001) 44
Santobello v. New York, 404 U.S. 257 (1971) 30
Sherman v. Smith, 89 F.3d 1134 (4th Cir. 1996) 44
Singleton v. United States, 26 F.3d 233 (1st Cir. 1994) 44
Stamler v. Willis, 415 F.2d 1365 (7th Cir. 1969) 54
Sullivan v. Louisiana, 508 U.S. 275 (1993) 38
Tumey v. Ohio, 273 U.S. 510 (1927) 38
Tyson v. Trigg, 50 F.3d 436 (7th Cir. 1995) 44
United States v. Al Jibori, 90 F.3d 22 (2d Cir. 1996) 52, 55
United States v. Alameh, 341 F.3d 167 (2d Cir. 2003) 48
United States v. Armstrong, 517 U.S. 456 (1996) passim
United States v. Barket, 530 F.2d 189 (8th Cir. 1976) 30
United States v. Barone, 467 F.2d 247 (2d Cir. 1972) 50
United States v. Bass, 536 U.S. 862 (2002) 48
United States v. Batchelder, 442 U.S. 114 (1979) 52
United States v. Bentvena, 319 F.2d 916 (2d Cir. 1963) 40
United States v. Berrios, 501 F.2d 1207 (2d Cir. 1974) 48, 50
United States v. Bifield, 702 F.2d 342 (2d Cir. 1983) 34
United States v. Butts, 630 F. Supp. 1145 (D. Me. 1986) 40
United States v. Cohen, 260 F.3d 68 (2d Cir. 2001) 1, 20
United States v. Crowthers, 456 F.2d 1074 (4th Cir. 1972) 51
United States v. Dominguez Benitez, 124 S.Ct. 2333 (2004) 39
United States v. Falk, 479 F.2d 616 (7th Cir. 1973) 51, 53
United States v. Fares, 978 F.2d 52 (2d Cir. 1992) 55
United States v. Ferrarini, 219 F.3d 145 (2d Cir. 2000) 33
United States v. Greenwood, 796 F.2d 49 (4th Cir. 1986) 55
United States v. Johnson, 216 F.3d 1162 (D.C.Cir. 2000) 44
United States v. Kellington, 217 F.3d 1084 (9th Cir. 2000) 42
United States v. Miguel, 338 F.3d 995 (9th Cir. 2003) 41, 42
United States v. Mitchell, 778 F.2d 1271 (7th Cir. 1985) 55
United States v. Ott, 489 F.2d 872 (7th Cir. 1973) 30, 31
United States v. Parham, 16 F.3d 844 (8th Cir. 1994) 55
United States v. Peete, 919 F.2d 1168 (6th Cir. 1990) 55
United States v. Ross, No. 98 CR. 1174-1 (KMV), 1999 WL 782749
(S.D.N.Y. Sept. 16, 1999) 22, 23
United States v. Steele, 461 F.2d 1148 (9th Cir. 1972) 51
Vasquez v. Hillery, 474 U.S. 254 (1986) 38
Walker v. Hood, 679 F. Supp. 372 (S.D.N.Y. 1988) 34, 35, 37
Waller v. Georgia, 467 U.S. 39 (1984) 38
Wayte v. United States, 470 U.S. 598 (1985) 48, 52
Yick Wo v. Hopkins, 118 U.S. 356 (1896) 47, 48
Yu v. United States, 183 F. Supp. 2d 657 (S.D.N.Y. 2002) 45
State Cases
State v. Dauzart, 769 So. 2d 1206 (La. 2000) 40
U.S. Constitution
U.S. Const. amend. V passim
U.S. Const. amend. VI 33
U.S. Const. amend. XIV 32
Statutes
15 U.S.C. § 3001 13, 21
15 U.S.C. § 3002 13
15 U.S.C. § 3004 13
18 U.S.C. § 1084 passim
18 U.S.C. § 371 1
28 U.S.C. § 2253 ix
28 U.S.C. § 2255 ix, 2, 24
Rules
ABA Model Rules of Prof’l Conduct R. 3.3 (2003) 31
CONSTITUTIONAL PROVISIONS & STATUTE INVOLVED
U.S. CONSTITUTION, AMEND. V
No person shall . . . be deprived of life, liberty, or property, without due process of law.
U.S. CONSTITUTION, AMEND. XIV
No State shall . . . deny to any person within its jurisdiction the equal protection of the laws.
18 U.S.C. § 1084(a), (b) (Wire Act)
§ 1084. Transmission of wagering information; penalties
(a) Whoever being engaged in the business of betting or wagering knowingly uses a wire communication facility for the transmission in interstate or foreign commerce of bets or wagers or information assisting in the placing of bets or wagers on any sporting event or contest, or for the transmission of a wire communication which entitles the recipient to receive money or credit as a result of bets or wagers, or for information assisting in the placing of bets or wagers, shall be fined under this title or imprisoned not more than two years, or both.
(b) Nothing in this section shall be construed to prevent the transmission in interstate or foreign commerce of information for use in news reporting of sporting events or contests, or for the transmission of information assisting in the placing of bets or wagers on a sporting event or contest from a State or foreign country where betting on that sporting event or contest is legal into a State or foreign country in which such betting is legal.
STATEMENT OF JURISDICTION
This is an appeal from a final order of the United States District Court for the Southern District of New York (Hon. Thomas P. Griesa), delivered in open court on March 9, 2004, denying Petitioner-Appellant Jay Cohen’s petition for a writ of habeas corpus pursuant to 28 U.S.C. § 2255. A8.[1] The district court granted a certificate of appealability on the same day, A8, and Cohen filed a timely notice of appeal on April 14, 2004. A859. This Court has jurisdiction to review the final order of the district court pursuant to 28 U.S.C. § 2253(a).
ISSUES PRESENTED FOR REVIEW
(1) Whether the repeated misrepresentations of the prosecutors concerning an issue central to Cohen’s defense, which caused the court to instruct the jury to disregard Cohen’s previously admitted testimony, deprived Cohen of his fundamental right to a fair trial and so infected the structure of the proceedings as to require reversal of Cohen’s conviction.
(2) Whether the Government selectively prosecuted Cohen in violation of his equal protection rights where the Government declined to prosecute others identically situated but for the fact that they offered wagering on a different sporting event.
x
STATEMENT OF THE CASE
On March 2, 1998, the United States Attorney’s Office for the Southern District of New York charged Jay Cohen by criminal complaint with one count of conspiracy to violate the Wire Act, 18 U.S.C. § 1084, in connection with his operation of World Sports Exchange, an offshore, Internet-based sports betting business.
Cohen voluntarily returned to the United States, where he was eventually charged by indictment with one count of conspiracy to violate the Wire Act, in violation of 18 U.S.C. § 371, and seven substantive counts of violating or aiding and abetting violations of the Wire Act. Trial commenced in Manhattan on February 14, 2000. On February 28, 2000, a jury returned a verdict of guilty on all counts. On August 9, 2000, the district court sentenced Cohen to a term of 21 months imprisonment, followed by two years of supervised release.
Cohen appealed his conviction to this Court, arguing, inter alia, that the evidence failed to establish the requisite criminal intent for both the conspiracy and substantive counts, that the district court erroneously instructed the jury with regard to mens rea, and that the district court erroneously concluded that the exception set forth in 18 U.S.C. § 1084(b) did not apply to this case. This Court affirmed. United States v. Cohen, 260 F.3d 68 (2d Cir. 2001). A738.
On June 16, 2003, Cohen filed a petition for a writ of habeas corpus pursuant to 28 U.S.C. § 2255, based upon evidence, discovered after the filing of his direct appeal, that gave rise to previously uncognizable claims that deprivations of his fundamental constitutional rights invalidated both his conviction and the initiation of Cohen’s prosecution. The district court ordered the Government to respond to Cohen’s claims, and heard oral argument on March 9, 2004. A817-58. At the conclusion of argument, the court issued a final order from the bench denying Cohen’s requests for relief, and granting a certificate of appealability. A858.
Cohen now appeals.
STATEMENT OF FACTS
In 1996, Jay Cohen was a twenty-nine year-old graduate of the University of California at Berkeley and held a lucrative position as a top trader at Group One, a San Francisco firm trading in options and derivatives. A481-90. Intrigued by the interest shown by his fellow traders in casual sports betting that mimicked the operation of the financial markets – trading in so-called sports “futures” – Cohen and his colleagues explored the possibility of establishing an Internet business that would permit such betting. A490-94. Cohen quickly found that several apparently legitimate business models existed. A494-95. Cohen took particular interest in Capital Off-Track Betting Corporation (“Capital OTB”), which was authorized by the state of New York to allow out-of-state customers to establish wagering accounts in New York and to give telephone instructions for wagers to be placed from those accounts. A517, A538. In addition to Capital OTB, Cohen found several other state-sanctioned companies that accepted wagering instructions on horse races from out-of-state bettors, as well as Sports International, an offshore, Internet-based sports wagering enterprise that was publicly traded on NASDAQ and boasted a former Congressional majority whip on its Board of Directors.
Consistent with these findings, the United States Department of Justice (“DOJ”) had publicly maintained that establishing an offshore gaming enterprise would not subject one to federal prosecution. As early as October 1995, DOJ spokesman John Russell was quoted in a news article concerning online betting as stating, “If the casinos are outside the United States, there’s not a thing we can do about it except prevail upon the host government.” Todd Copilevitz, “Betting on the Net – Old Vice, New Form: Casinos Beckon Via Home Computers,” Dallas Morning News (Oct. 22, 1995), at 1A. A17. Russell went on to acknowledge that enforcement of gambling statutes was not a federal priority: “If you look in the federal penitentiaries you’re not going to find anyone doing time for violating gambling statutes. . . . It’s not that vexing a problem.” Id.
DOJ continued to express this position throughout the next two years. In May 1997, Computer Shopper magazine quoted Russell as stating that the federal government had “yet to prosecute anyone” for domestic online gambling, and that it “can’t touch” overseas online gaming operators. Patrick Mitchell, “Online Gambling Beyond Justice Department Control,” Computer Shopper (May 1, 1997), at 101. A23. In January 1998, the New York Times reported that DOJ had declined to take action against offshore sports betting and casino operations despite requests from several state attorneys general, and quoted Russell as stating that, “We have no jurisdiction. . . . The offense has not been made on U.S. soil.” Brett Pulley, “With Technology, Island Bookies Skirt U.S. Law,” New York Times (Jan. 31, 1998). A319. Also in January 1998, Sports Illustrated attributed the following remark to Russell: “International Internet gambling? We can’t do anything about it. . . . That’s the bottom line.” Steven Crist, “All Bets Are Off,” Sports Illustrated (Jan. 26, 1998), at 85. A310.
Cohen’s research led him to conclude that he would not run afoul of United States law if his offshore company employed an “account wagering” format such as that used by Capital OTB and other off-track betting entities. A538, A540-42. In an account wagering system, the customer establishes an account with a certain minimum amount of funds in the jurisdiction where the wagering facility is located. A538. From time to time, the customer then requests, via telephone or the Internet, that funds from the account be used to place specified wagers. Id. Upon receiving such a request, the facility verifies that the account contains sufficient funds and that the requested wager otherwise complies with applicable rules and regulations, and then places the wager in the jurisdiction where the account and wagering facility are located. A547. As Cohen’s counsel explained to the district court, a number of off-track betting enterprises operated in this manner without federal government interference, despite the fact that they enjoyed no federal exemption from the statute under which Cohen was later prosecuted. See, e.g., A454-55; A549-50.