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U.S. v. PHAM

June 8, 2005.

UNITED STATES OF AMERICA,
v.
CHUONG DIN PHAM, a/k/a "Quoc Thien Nguyen," Defendant.



The opinion of the court was delivered by: KEVIN FOX, Magistrate Judge

REPORT and RECOMMENDATION

TO THE HONORABLE DENISE L. COTE, UNITED STATES DISTRICT JUDGE

I. INTRODUCTION

  Before the Court is an application by the government that cash bail deposited to secure an appearance bond be forfeited and that a default judgment be entered against the defendant and the surety on his appearance bond for the full amount of the bond. The surety opposes the government's application and argues that equity warrants the court in denying that application.

  II. BACKGROUND

  Chuong Din Pham ("Pham") was arrested in September 2004 and charged with violating Title 18 U.S.C. § 1542, which makes it an offense for a person to make any false statement willfully and knowingly in an application for a passport with the intent to induce or secure the issuance of a passport under the authority of the United States. Thereafter, a United States magistrate judge, in accordance with Title 18 U.S.C. § 3142, fashioned bail conditions under which Pham might be released pending trial. They included, among other things, that Pham and one financially responsible person execute a $50,000 personal recognizance bond, that $2,000 be posted in support of the bond and that Pham restrict his travel to the Southern District of New York, the Eastern District of New York and the District of New Jersey. Pham was also placed under the supervision of the Pretrial Services Office for this judicial district.

  On January 10, 2005, Pham's trial was scheduled to commence. The prosecutor appeared in the designated courtroom on that date as did Pham's defense counsel. However, Pham elected not to attend court on that date and has not returned to court since that time. As a result of Pham's failure to attend court on the date fixed for the commencement of his trial or on any date thereafter, the government has made an application, pursuant to Rule 46 of the Federal Rules of Criminal Procedure, for an order: 1) entering judgment by default against Pham and the surety on his bond, Christy Le ("Le"), for $50,000; and 2) forfeiting to the United States the $2,000 posted as security at the time that the appearance bond was executed by Pham and Le.

  Le concedes through a written submission made to the Court "that there is no technical or statutory defense to the relief sought by the Government." Nevertheless, she opposes the application that has been made by the government. Le contends that the court should exercise the discretion vested in it by Fed.R.Civ.P. 46(f)(2) to set aside, in whole or in part, a bail forfeiture because, in the instant case, equity warrants the court in taking that action. Le explains that, in early August 2004, she became aware of Pham when she was contacted by a friend of her family who resides in Florida. Pham is acquainted with Le's family friend. Pham was described to Le as a person who was trustworthy and interested in working and learning a trade. Le, who owns and operates a nail-care business, met with Pham in mid-August 2004, and concluded that Pham was interested in learning to be a manicurist. Le agreed to train Pham in the nail-care business and to provide housing for him in her home. Pham worked at Le's nail-care establishment cleaning the facility and its utensils. Pham also polished customers' nails and processed their cash and credit card payments. In addition, Pham performed general maintenance duties at Le's home and assisted her by performing various chores and escorting her children to school when scheduling conflicts prevented Le from doing so.

  In early September 2004, Pham was arrested for the charge noted above. Le determined to assist him. She borrowed money from friends and family members to post the cash component of Pham's bail and she co-signed his appearance bond. By signing the appearance bond, Le acknowledged, along with Pham, that they were "jointly and severally ? bound to pay to the United States of America the sum of $50,000" if Pham failed to abide by the conditions set forth on the face of the bond, under which he was released from custody pending a trial.

  After Pham was released from custody, he continued to perform the domestic and workplace assignments for Le he had been performing prior to his arrest. However, according to Le, without her knowledge, Pham obtained "duplicate credit cards on ? Le's accounts" and obtained new credit card accounts in their joint names. Pham began using the credit cards to take excursions from New Jersey, where he worked and resided, to points beyond the geographical limits to which he was confined by the terms and conditions under which he was released from custody by a United States magistrate judge. In November 2004, Le learned that Pham had violated the terms and conditions under which he was released from custody when she received invoices from various credit card companies detailing Pham's travel activities. However, Le did not inform the court of Pham's misconduct; nor did she seek to withdraw as a surety on his appearance bond. By mid-November 2004, Le became aware, through a credit card invoice she received, that Pham had traveled to his native country, Vietnam, and had amassed thousands of dollars of debt using the credit cards noted above. Armed with information that Pham had fled the country, Le took no steps to: (a) inform the court of Pham's departure; or (b) terminate her role as a surety on Pham's appearance bond. Le traveled to Vietnam but was not able to locate Pham. The record before the Court does not indicate that Le provided any information she learned during her Vietnam visit to the government so that it might attempt to use its own resources to locate Pham and return him to this country.

  Le's written submission to the Court, in opposition to the government's application, indicates that she would suffer great financial hardship if Pham's bail were forfeited and a default judgment were entered against her for the full amount of the bond. Le's written submission to the Court notes that she and her husband have been separated for several years, that she is raising two children aged 11 and 14 on her own and that she does not receive support from her husband. That document also contains financial data that Le contends demonstrates that: (i) the income she derives from her business is small — less than $20,000 during the calendar years 2003 and 2004; (ii) her total monthly income, as of December 31, 2004, is equal to her total monthly expenses; and (iii) her total assets as of January 31, 2005, $362,849, exceed her total liabilities by $54,573. Therefore, according to Le, an order directing that she forfeit the $2,000 she deposited as security for Pham's appearance bond and "the imposition of a judgment in the amount of $50,000 would wipe her out and likely result in the loss of her line of credit on which she relies to run her business."

  The Court notes that the unsigned income tax returns submitted by Le, in support of her contention that equity warrants the court in denying the government's application, are income tax returns that were filed jointly by Le and her husband, although Le maintains that the couple has been "separated for several years." Furthermore, the income tax returns appear to indicate that Le's husband is her employee. Moreover, a "Monthly Budget" financial statement and a "Summary Balance Sheet" that were prepared by Le's accountant and are among the exhibits to the written submission Le made to the Court, are identified as the joint "Monthly Budget" for Le and her husband and their joint "Summary Balance Sheet." Both documents indicate that Le and her husband share the same residential address. It is the same residential address that appears on their joint income tax returns. No explanation has been provided to the Court for the accountant's determination to prepare a joint monthly budget for a couple that has been "separated for several years." According to the "Summary Balance Sheet," Le owns real estate valued at $348,000 on which a $246,000 mortgage exists. Therefore, she has equity of $102,000 in that property.

  III. DISCUSSION

  Fed.R.Crim.P. 46(f)(1) provides that a "court must declare the bail forfeited if a condition of the bond is breached." However, a "court may set aside in whole or in part a bail forfeiture upon any condition the court may impose if: (A) the surety later surrenders into custody the person released on the surety's appearance bond; or (B) it appears that justice does not require bail forfeiture." Fed.R.Crim.P. 46(f)(2). If a court does not set aside a bail forfeiture, it "must, upon the government's motion, enter a default judgment." Fed.R.Crim.P. 46(f)(3)(A). After a judgment has been entered pursuant to Fed.R. Crim P. 46(f)(3), a court "may remit in whole or in part the judgment under the same conditions specified in Rule 46(f)(2)." Fed.R.Crim.P. 46(f)(4). By the express language of Fed.R.Crim.P. 46(f)(1), the court is duty-bound to declare Pham's bail forfeited, since he has violated conditions of his bond by: (i) failing to attend court on the date fixed for the commencement of his trial or on any date thereafter; and (ii) traveling beyond the geographic limits placed on him by a United ...


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