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UNITED STATES v. SPY FACTORY

January 8, 1997

UNITED STATES OF AMERICA
v.
THE SPY FACTORY, INC. d/b/a "Spy Factory," RONALD KIMBALL, MARLIN RICHARDSON, a/k/a "Brud," and TRACY EDWARD FORD, Defendants.



The opinion of the court was delivered by: SOTOMAYOR

 SONIA SOTOMAYOR, U.S.D.J.

 BACKGROUND

 The Spy Factory "is a retail store concept developed in 1989 to sell personal protection devices and personal security items to the general public and law enforcement agencies." (Defs.' Vagueness Mem. at 3) *fn1" "At the time of the initial searches and arrests in this case, Spy Factory, which is headquartered in Texas, had 16 stores located throughout the United States." (Id.).

 "In 1993, the United States Customs Service ... began an investigation of illegal bugging and wiretapping devices that were imported into the United States and sold by various so-called 'spy shops.'" (Govt Mem. at 2). According to the Government, "Spy Factory was and is the largest chain of retail spy shops' in the country." (Id.) Working across the country, but centralizing its efforts in New York City, the Government used undercover agents and confidential informants to gather evidence to prosecute the Spy Factory and the individually-named defendants for "violations of customs laws, Section 2512 of Title III, and the Communications Act of 1934." (Govt Mem. at 4).

 "On August 16, 1995, a grand jury sitting in the Southern District of New York returned an eight-count indictment . . . charging Spy Factory, its owner, Ronald Kimball, its general manager, Marlin Richardson, a/k/a 'Brud,' and its deputy general manager, Tracy Edward Ford, with a conspiracy to smuggle and sell illegal bugging and wiretapping devices .... "(Govt Mem. at 4). On June 12, 1996, a grand jury returned a 70-count superseding indictment adding to the original indictment "several objects to the conspiracy, and additional substantive violations of Title 18, United States Code, Sections 2512(1)(a), 2512(1)(b), and 545 relating to numerous sales of illegal bugging and wiretapping devices from the Southern District of New York." (Id.) The indictment also included "a conspiracy and substantive counts of money laundering." (Id.).

 On June 14, 1996, the Honorable Milton Pollack, then acting as Part One Judge of this District, signed an ex parte restraining order that put the assets of Spy Factory "under the control of a special monitor from the accounting firm of KPMG Peat Marwick, LLP, who oversees and controls expenditures of funds, including expenditures for legal expenses in this case." (Defs.' Venue Mem. at 14). "Under the terms of the Restraining Order . . . and related letter agreement . . . dated August 28, 1996, . . . the corporation is limited to $ 2,000.00 per month for the payment of legal expenses." (Defs.' Venue Mem. at 14).

 On September 16, 1996, less than four months before the scheduled trial date of January 14, 1997, and approximately one year after the first pre-trial conference in this action, the defendants filed their pretrial motions in this action. The defendants moved, inter alia, for a change of venue from the Southern District of New York to the Western District of Texas, where Spy Factory is headquartered and where all the defendants and most of the defense witnesses reside. The defendants claim that trial in New York is beyond the means of at least two of the defendants to afford and that forcing defendants and their counsel and witnesses to travel to, and be lodged in, New York, "one of the most expensive cities in the world," (Defs.' Venue Mem. at 4), would impose a tremendous financial burden upon them. Further, defendants insist that if they are forced to stand trial in the Southern District of New York, their businesses and employment in San Antonio would be seriously jeopardized. They contend that given these considerations, "the interests of justice" require that the trial be moved to San Antonio, Texas.

 The Government counters that defendants unduly delayed their filing of the change of venue motion and that such delay should militate against the Court's granting of the motion. Furthermore, the Government argues that if the trial were transferred to Texas, not only would the Government incur significant financial expenses to move all its case-related materials and personnel out-of-state, but that the trial itself inevitably would be delayed so that local assistant United States attorneys in Texas could familiarize themselves with the intricacies of the case. With respect to the defendants' assertions that their businesses and employment prospects would suffer if they were tried in New York, the Government minimizes this argument by contending that inconvenience and interference with normal occupational and personal activities occur whenever a defendant is involved in a trail [sic] facing serious charges." (Govt Mem. at 43). They conclude, "the defendants' contention that they plan to carry on their normal occupational activities during the lunch hour and after-hours of this major trial in which they face serious charges is highly dubious, and is insufficient in light of the delay and other factors in this case to warrant a change of venue." (Govt Mem. at 44).

 With respect to the personal financial burden that at least two of the defendants would have to endure by having the case tried in New York, the Government contends that the financial impact on the defendants of trial in New York can be alleviated considerably. At an oral argument held on December 13, 1996, the Court determined that both defendants Tracy Ford and Marlin Richardson qualified for appointment of CJA counsel. *fn2" The Court asked the Government whether it would agree to pay the travel and lodging expenses of these defendants in the same manner it had offered to do in United States v. Wheaton, 463 F. Supp. 1073, 1078 (S.D.N.Y.), aff'd sub nom., United States v. Williams, 614 F.2d 1293 (1979). During a conference held with the Court on December 19, 1996, the Government agreed to pay for the travel and lodging costs of defendants Tracy Ford and Marlin Richardson and their attorneys during the trial. The Government also agreed to pay for three trips home for defendants Ford and Richardson and their counsel during the course of the trial so that the effect of the defendants' separation from their families and businesses would be alleviated to some extent, At the same conference, the Government noted that the Criminal Justice Act would cover any expenditures necessary to bring relevant defense witnesses for these defendants to New York for trial.

 The defendants also move to dismiss the majority of the counts in the Indictment on the grounds that the statute upon which the prosecution is based, 18 U.S.C. § 2512, is unconstitutionally vague as applied to them. In short, the defendants argue that the terms "primarily" and "surreptitious" in the statute render its meaning unconstitutionally vague, especially when read in connection with § 2511 of the statute, which purports to legalize some forms of "surreptitious" interceptions, i.e., interceptions of conversations in which at least one party to the conversation consents, while other forms of "surreptitious" interceptions remain illegal, i.e., interceptions of conversations in which no party to the conversation consents to its interception.

 In their pretrial motions, defendants made several discovery requests and moved for the suppression of evidence seized in the search of Spy Factory stores. For the reasons set forth on the record at the December 13, 1996 conference, the Court denies the discovery requests in part and grants others, in part, and denies the suppression motion. (12/13/96 Tr. at 39-59).

 As of May 6, 1996, the Court had set a trial date of January 14, 1997. After oral argument on the instant motions, however, defendant Tracy Ford decided, after a Curcio hearing, that a potential conflict of interest *fn3" with his counsel necessitated substitution of counsel. After conferring with new CJA counsel as to the time necessary to prepare the case, the Court adjourned the trial date until February 18, 1997.

 DISCUSSION

 I. CHANGE OF VENUE

 A. THE STANDARD UNDER FED. R. CRIM. P. 21(B)

 Federal Rule of Criminal Procedure 21(b) provides that "for the convenience of parties and witnesses, and in the interest of justice, the court upon motion of the defendant may transfer the proceeding as to that defendant or any one or more of the counts thereof to another district." Rule 22 of the Federal Rules of Criminal Procedure states that such a motion to transfer "may be made at or before arraignment or at such other time as the court or these rules may prescribe." Fed. R. Cr. P. 22.

 B. THE PLATT FACTORS

 The following ten factors introduced in Platt v. Minnesota Mining Co., 376 U.S. 240, 11 L. Ed. 2d 674, 84 S. Ct. 769 (1964), are routinely considered by courts deciding motions to change venue.

 
1. Location of the Defendants
 
2. Location of the Witnesses
 
3. Location of the Events in Issue
 
4. Location of Documents and Records
 
5. Disruption of the Defendants' Business(es)
 
6. Expense to the Parties
 
7. Location of Counsel
 
8. Relative Accessibility of the Place of Trial
 
9. Docket Condition of Each District
 
10. Other Special Elements

 See United States v. Russell, 582 F. Supp. 660, 662 n.2 (S.D.N.Y. 1984) ("While not specifically adopting these factors, the Court implicitly approved them in Platt, and courts have consistently used them ever since."). A Court should weigh the ten Platt factors against one another and against the backdrop of doing what is in the overarching interest of justice. A Court should not give any one factor preeminent weight nor should it assume that the quantity of factors favoring one party outweighs the quality of factors in opposition. See United States v. Maldonado-Rivera, 922 F.2d 934, 966 (2d Cir. 1990) ("No one of these considerations [the Platt factors] is dispositive, and 'it remains for the court to try to strike a balance and determine which factors are of greatest importance.'") (citing United States v. Stephenson, 895 F.2d 867, 875 (2d Cir. 1990), cert. denied, 501 U.S. 1211 (1991). Rather, a Court should look to all of the factors and determine whether the interests of justice would be better served by changing the trial venue. In essence, "the determination of whether a particular case calls for transfer depends upon the peculiar facts and circumstances of that case." United States v. Posner, 549 F. Supp. 475, 477 (S.D.N.Y. 1982).

 1. Location of the Defendants

 The first of the Platt factors, the location of the defendants, weighs in favor of a change of venue in this action. All three of the individual defendants reside in San Antonio, and Spy Factory was incorporated in Texas and is headquartered in San Antonio. Furthermore, it is has been said that as a matter of "policy" courts should, "wherever possible," try defendants "where they reside." United States v. Russell, 582 F. Supp. 660, 662 (S.D.N.Y. 1984); see also United States v. Cashin, 281 F.2d 669, 675 (2d Cir. 1960) ("Recognizing the unfairness and hardship to which trial in an environment alien to the accused exposes him, and the important policies underlying the venue provisions of the Constitution and Bill of Rights, the Supreme Court has declared that venue statutes should, whenever possible, be construed so to permit trial at the residence of the defendant.") (citations and internal quotation marks omitted); United States v. Aronoff, 463 F. Supp. 454, 457 (S.D.N.Y. 1978) ("As ... many other judges have recognized, it can be a hardship for a defendant to face a trial far away from home and from 'appropriate facilities for defense.' ... It has been stated, therefore, that as a matter of policy, a defendant should ordinarily be tried, whenever possible, where he resides.") (citations omitted). Thus, while the Supreme Court has said that the defendant's residence has no "independent significance," and should not be given dispositive weight, see Platt v. Minnesota Mining Co., 376 U.S. 240, 246, 11 L. Ed. 2d 674, 84 S. Ct. 769 (1964), the fact that all defendants reside in San Antonio weighs in favor of the transfer of venue, absent other countervailing considerations.

 2. Location of Witnesses

 a). Defendants' Witnesses

 Defendant Ron Kimball claims that the 20 witnesses he intends to call, most of them fact witnesses, all reside in San Antonio. Defendant Marlin Richardson maintains that the 9 fact witnesses he intends to call all reside in San Antonio and that "the majority of the remainder" of his 30 witnesses reside in the proximity of San Antonio. Finally, Defendant Tracy Ford insists that he plans to call 25 witnesses, all of whom reside in San Antonio. Defendants collectively claim that "these witnesses are willing and able to appear to testify in the Western District of Texas, but, for a variety of reasons, including a lack of financial resources, are unable to travel to the Southern District of New York to appear as witnesses if the trial is commenced there." (Defs.' Venue Mem. at 2).

 The expenses for any pertinent witnesses testifying on behalf of defendants Richardson and Ford will be paid from CJA funds. Defendant Kimball has not shown himself financially incapable of paying the expenses of his witnesses. More importantly, however, as the Government points out in its response, "the defendants do not identify any of these witnesses or explain their relevance to the pending charges." (Govt Mem. at 41). Courts in other circuits have held that "generally, a naked allegation that witnesses will be inconvenienced by trial in a distant forum will not suffice for transfer.... Defendants must offer specific examples of witnesses' testimony and their inability to testify because of the location of the trial.... the court must rely on 'concrete demonstrations' of the proposed testimony." United States v. Haley, 504 F. Supp. 1124, 1126 (E.D. Pa. 1981) (citing United States v. Kelly, 467 F.2d 262, 265 (7th Cir. 1972), cert. denied, 411 U.S. 933, 36 L. Ed. 2d 393, 93 S. Ct. 1905 (1973); Jones v. Gasch, 131 U.S. App. D.C. 254, 404 F.2d 1231, 1243 (D.C. Cir. 1967), cert. denied, 390 U.S. 1029, 20 L. Ed. 2d 286, 88 S. Ct. 1414 (1968); United States v. Barrientos, 485 F. Supp. 789, 790 n.2 (E.D. Pa. 1980)). Thus, the defendants here have not met their burden of proving that the location of necessary and relevant witnesses compels a transfer to the Western District of Texas.

 b). Government's Witnesses

 The Government's witnesses are various Customs Service agents, FCC investigators and "seizing and custodial agents from each of the Spy Factory locations located in Atlanta, Chicago, Costa Mesa, Dallas, Denver, Houston, Las Vegas, San Antonio, St. Louis, Salt Lake City, San Diego, San Francisco, Seattle, Tuscon, and West Hollywood." (Govt Mem. at 40) "In addition, the Government may call as witnesses purchasers of the illegal devices in the Southern District of New York and elsewhere." (Id. at 41). Because with the exception of the purchasers in the Southern District, most of the Government's witnesses appear to be scattered around the country, and, given the defendants' failure to meet their burden, the location of witnesses does not weigh in favor of either party.

 3. Location of the Events in Issue

 Defendants contend that "the majority of the acts and conduct in furtherance of the alleged conspiracy occurred at corporate headquarters in San Antonio, Texas." (Defs.' Venue Motion at 2). They explain:

 
All correspondence and purchasing from Japan occurred from the San Antonio office. Catalog sales took place in San Antonio. Revenue from all sales throughout the country were transferred to San Antonio. Payroll and payment of all other business expenses were paid or authorized from San Antonio. All business decisions were made in San Antonio.

 (Id. at 3). Defendants also underscore that Spy Factory has no stores in New York and only minimal business contacts here. Of "'thousands' of illegal transactions [alleged to have been committed] by Spy Factory," the defendants argue that "only a few isolated telephone sales to four customers in New York are alleged in the Indictment and presumably are relied on by the Government to support venue in New York." (Id.) They further insist that "Spy Factory did no advertising in New York, ... did no direct mailing [to] New York, ... did no soliciting in New York, ... had no plans to sell in New York, ... [and] had no sales personnel in New York ...." (Defs.' Venue Reply at 6 (quoting Richardson Aff.)).

 In response, the Government explains (1) that "undercover agents of the Customs Service conducted surveillance" at Spy Factory's locations throughout the country, (2) that "the Customs Service operated an undercover company in New York City from which telephone calls were made and illegal devices were received, and (3) that "of the 70 counts of the Superseding Indictment, 45 counts are substantive counts that are based on numerous sales of illegal devices to purchasers here in the Southern District of New York." (Govt Mem. at 40). Because the criminal activity that was alleged to have occurred in this case was concededly national in scope, the location of the events at issue favors neither side. Cf. United States v. Alter, 81 F.R.D. 524, 526 (S.D.N.Y. 1979) (finding that location of events at issue favored transfer to alternate forum where "it is beyond dispute that most, if not all, of the acts and conduct in furtherance of the alleged scheme to defraud occurred in [the alternate venue] and that it was the 'nerve center' of the alleged illicit operations in carrying out the scheme ...."); United States v. Bein, 539 F. Supp. 72, 74 (N.D. Ill. 1982) (despite fact that "the entire [criminal] operation was centered in [the alternate forum]," the countervailing consideration that "victims were solicited [in the trial venue]" and that "victims wired funds from [the trial venue]," made the location of the events at issue factor weigh in favor of a transfer only by "a small margin."); United States v. Haley, 504 F. Supp. 1124, 1128 (E.D. Pa. 1981) (where "many of the overt acts described in the indictment purportedly occurred in [the transfer venue] or surrounding states," this was showing of a "nerve center" which weighed in favor of transferring venue to the alternate forum).

 4. Location of Documents and Records

 
Most of the ... documents and records are now in Chicago, but this is a result of the government having seized them in New York and bringing them here. Two things are clear:
 
(a) It would be grossly unfair to permit the government to "create" venue, or to alter the balance of relevant considerations, simply by shipping documents.
 
(b) Documents moved here can just as easily be moved back to New York, or photocopies may be shipped there.

 United States v. Bein, 539 F. Supp. 72, 74 (N.D. Ill. 1982) (finding that "this factor must therefore be viewed as essentially neutral. It thus drops out of the equation."); see also United States v. Posner, 549 F. Supp. 475 (S.D.N.Y. 1982) (Even where the Government has "five file drawers of documents," "the location of documents and records is not a major concern in these days of ...


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