|
UNITED STATES OF AMERICA,
Appellee, v. FREDERICK SCHULTZ, Defendant-Appellant. Docket No. 02-1357 UNITED STATES COURT OF APPEALS FOR
THE SECOND CIRCUIT 333 F.3d 393; 2003 U.S. App.
LEXIS 12834 March 10, 2003, Argued June 25, 2003, Decided SUBSEQUENT HISTORY:
As
Corrected July 28, 2003. US Supreme Court certiorari denied by Schultz v.
United States, 540 U.S. 1106, 157 L. Ed. 2d 891, 124 S. Ct. 1051, 2004 U.S.
LEXIS 70 (2004) Post-conviction relief denied at Schultz v. United States, 2005 U.S.
Dist. LEXIS 12836 (S.D.N.Y., June 24, 2005) PRIOR HISTORY: [*1] Appeal from a
judgment of conviction entered in the United States District Court for the
Southern District of New York, Rakoff, J., after a trial by jury. Affirmed.
United States v. Schultz, 178 F. Supp. 2d 445, 2002 U.S. Dist. LEXIS 15
(S.D.N.Y., 2002) COUNSEL: PAUL SHECHTMAN, New York City (Kathryn A. Meyers,
Stillman & Friedman, New York City, of counsel), for Appellant. MARCIA R. ISAACSON,
Assistant United States Attorney, Southern District of New York, New York City
(James B. Comey, United States Attorney for the Southern District of New York,
Gary Stein, Assistant United States Attorney, Southern District of New York,
New York City, of counsel), for Appellee. JUDGES: Before: MESKILL, CARDAMONE and CABRANES, Circuit
Judges. OPINION BY: MESKILL OPINION: MESKILL, Circuit Judge: Defendant-appellant Frederick Schultz (Schultz) appeals from a
judgment of conviction entered in the United States District Court for the
Southern District of New York, Rakoff, J., after a trial by jury. Schultz was
convicted of one count of conspiracy to receive stolen property that had been
transported in interstate and foreign commerce, in violation of 18 U.S.C.
§ 371. The district court had jurisdiction pursuant to 18 U.S.C.
§ 3231. Appellate [*2]
jurisdiction is appropriate because “we have jurisdiction to
consider appeals from final decisions of the district courts, which are
judgments of conviction and sentence in criminal cases.” United
States v. Ferguson, 246 F.3d 129, 138 (2d Cir. 2001). See also 28 U.S.C.
§ 1291. BACKGROUND Schultz was a successful art dealer in New York City. On July 16,
2001, he was indicted on one count of conspiring to receive stolen Egyptian
antiquities that had been transported in interstate and foreign commerce, in
violation of 18 U.S.C. § 371. The underlying substantive offense was
violation of 18 U.S.C. § 2315, the National Stolen Property Act (NSPA)
. Schultz moved to dismiss the indictment, asserting that the items he
was charged with conspiring to receive were not stolen within the meaning of
the NSPA. Specifically, Schultz contended that the Egyptian antiquities he
allegedly conspired to receive were not owned by anyone, and therefore could
not be stolen. The prosecution asserted that the antiquities were owned by the
Egyptian government pursuant to a patrimony law known as “Law
117” which declared [*3] all
antiquities found in Egypt after 1983 to be the property of the Egyptian
government. After an evidentiary hearing, the district court denied the motion
to dismiss in a written memorandum and order. See United States v. Schultz, 178 F. Supp. 2d 445
(S.D.N.Y. 2002). Schultz was tried before a jury in January and February 2002. The following facts were adduced at trial. In 1991, Schultz met Jonathan Tokeley Parry (Parry), a British
national, through a mutual friend. Parry showed Schultz a photograph of an
ancient sculpture of the head of Pharaoh Amenhotep III, and told Schultz that
he had obtained the sculpture in Egypt earlier that year from a man who
represented himself to be a building contractor. Parry had used an Egyptian
middle-man named Ali Farag (Farag) to facilitate the deal. Parry had smuggled
the sculpture out of Egypt by coating it with plastic so that it would look
like a cheap souvenir, then removed the plastic coating once the sculpture was
in England. Schultz offered Parry a substantial fee to serve as the agent for sale
of the Amenhotep sculpture, which Parry accepted. Parry and Schultz discussed
the problems that might arise if they were discovered [*4] to have the piece, and set out to
create a false provenance for the sculpture, so that they could sell it. They
decided that they would claim that the sculpture had been brought out of Egypt
in the 1920s by a relative of Parry and kept in an English private collection
since that time. Parry and Schultz invented a fictional collection, the
“Thomas Alcock Collection,” and represented to potential buyers
that the sculpture came from this collection. With Schultz’s
knowledge, Parry prepared fake labels, designed to look as though they had been
printed in the 1920s, and affixed the labels to the sculpture. Parry also
restored the sculpture using a method popular in the 1920s. Acting as Parry’s agent, Schultz attempted to sell the
Amenhotep sculpture to various parties, using the “Thomas Alcock
Collection” story, but was unsuccessful. Eventually, Parry sold the
sculpture to Schultz for $ 800,000, and Schultz sold it to a private collector
in 1992 for $ 1.2 million. In June 1995, Robin Symes (Symes), who then owned
the Amenhotep sculpture, asked Schultz to provide him with more details about
the sculpture’s origin, because he had learned that the Egyptian
government was pursuing the sculpture.
[*5] Schultz responded by asking questions regarding the Egyptian
pursuit, but did not provide Symes with any additional information regarding
the Amenhotep sculpture. Parry and Schultz became partners, in a sense. They endeavored to
bring more Egyptian antiquities into America for resale, smuggling them out of
Egypt disguised as cheap souvenirs, assigning a false provenance to them, and
restoring them with 1920s techniques. Parry testified about six items or groups
of items, in addition to the Amenhotep sculpture, that he and Schultz attempted
to remove from Egypt and sell under the false provenance of the Thomas Alcock
Collection. In 1991, Parry smuggled a sculpture of Meryet Anum (a daughter of
Pharoah Ramses II) out of Egypt and performed extensive restorations on it.
Parry brought the sculpture to New York and showed it to experts who determined
it to be a fake. In 1992, Parry sold Schultz a black top vase for $ 672, informing
Schultz that the vase had been brought out of Egypt. Parry affixed a Thomas
Alcock Collection label to the vase. Schultz and Parry acquired this vase
because they believed that including some less valuable pieces in the imaginary
Thomas Alcock Collection would [*6]
make the Collection more believable. In 1992, Parry wrote to Schultz from Egypt, telling Schultz that he
had obtained a sculpture he called “The Offeror.” Parry
smuggled The Offeror out of Egypt and performed extensive restoration work on
it. Parry believed the sculpture was authentic until testing revealed it to be
a fake. Parry delivered The Offeror to Schultz without informing him of either
the extensive restorations or the fact that the sculpture was not authentic.
However, when Schultz discovered the sculpture was a fake, he returned it to
Parry. Later, when Parry was arrested, The Offeror was confiscated by British
authorities. Schultz contacted the authorities attempting to claim The Offeror
as his own, eventually sending a forged invoice purporting to show that Schultz
had bought the sculpture from a New York art dealer and had given it to Parry
only for restoration. Schultz did not succeed in claiming The Offeror. In 1992, Parry and Farag learned that someone had reported them to the
Egyptian authorities for dealing in antiquities. Due in part to the assistance
of Farag’s father, who was a powerful Egyptian government official,
Parry and Farag were able to get their names [*7] removed from police records by paying a
bribe to certain corrupt members of the Egyptian antiquities police. These same
corrupt police officers then entered into a deal with Parry and Farag, offering
them a variety of antiquities in police possession in exchange for Parry and
Farag paying off some debts owed by the police officers. Parry chose three
items from the “bran tub” n1 full of items offered; he later
sent those items to Schultz. Parry informed Schultz of how he had obtained the
items. One of the items was marked with an Egyptian government registry number,
which Parry succeeded in partially obliterating. - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - - n1 A “bran tub” is a British term for a sort of
“grab bag” selection of items. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - In 1992, Parry purchased the top half of a limestone sculpture of a
striding figure, which he dubbed “George,” from a group of
Egyptian villagers. Apparently, when the sculpture had been found, it was in
pieces, and the pieces were divided among rival groups of villagers. Parry
wrote to Schultz telling him of the acquisition [*8] and informing Schultz that he was
attempting to obtain George’s bottom half. Parry also requested money
to assist in the purchase of George and other items. Parry and Farag eventually
succeeded in purchasing the bottom half of the sculpture, and reassembled the
whole thing. Parry then coated George in plastic, and in plaster, and painted
it to look like a tourist souvenir so it could be taken out of Egypt. Parry
kept Schultz informed of his progress and eventually brought George to New York
for Schultz to sell. When George was offered for sale, it was treated with
1920s restoration techniques and represented to be part of the Thomas Alcock
Collection. Schultz was unable to sell George, and Parry requested that Schultz
send George to Switzerland, where Parry planned to retrieve it. For reasons
that are not clear from the record, Parry was not able to retrieve George. In June 1994, Parry was arrested in Great Britain, and Farag was
arrested in Egypt. Each was charged with dealing in stolen antiquities. Schultz
was aware of the arrests and communicated extensively with Parry after his
arrest about Parry’s legal situation. Parry and Schultz also continued
to correspond regarding plans [*9] for
new acquisitions. In December 1994, Parry wrote to Schultz describing three limestone
“stelae,” or inscribed slabs, which had been discovered by
builders in Egypt and were being offered for sale. Parry had an expert review
photographs of the stelae, and the expert determined that the pieces were newly
discovered and not listed in any of the catalogs of antiquities known to the
Egyptian government. By 1995, there were ten pieces available from this find,
and although Parry had been taken into custody in Great Britain, he continued
attempting, with Schultz, to obtain the stelae. Schultz sent money for this
purpose, and Parry directed that the pieces be shipped to Switzerland for Parry
to retrieve in 1996. However, neither Parry nor Schultz ever actually obtained
the stelae. Throughout their partnership, Parry and Schultz communicated
regularly; many of their letters were introduced in evidence by the government.
Their letters indicate an awareness that there was a great legal risk in what
they were doing. This awareness is reflected both in the content of the letters
and in Parry’s and Schultz’s use of “veiled
terms,” code, or even languages other than English. The jury found [*10]
Schultz guilty on the sole count of the indictment, and on June 11,
2002, Schultz was sentenced principally to a term of 33 months’
imprisonment. This appeal followed. On appeal, the Court received three amicus curiae briefs. The National
Association of Dealers in Ancient, Oriental & Primitive Art, Inc.;
International Association of Professional Numismatists; The Art Dealers
Association of America; The Antique Tribal Art Dealers Association; The
Professional Numismatists Guild; and The American Society of Appraisers filed a
brief in support of Schultz. An ad hoc group called Citizens for a Balanced
Policy with Regard to the Importation of Cultural Property, made up of
politicians, academics, and art collectors, also filed a brief in support of
Schultz. These briefs argue primarily that allowing Schultz’s
conviction to stand would threaten the ability of legitimate American
collectors and sellers of antiquities to do business. The Archaeological
Institute of America; The American Anthropological Association; The Society for
American Archaeology; The Society for Historical Archaeology; and the United
States Committee for the International Council on Monuments and Sites
filed [*11] a brief in support of the United
States. This brief argues primarily that sustaining Schultz’s
conviction and applying the NSPA to cases such as this one will help to protect
archaeological and cultural sites around the world. DISCUSSION I. Application of the NSPA to Cases Involving Patrimony Laws In order to preserve its cultural heritage, Egypt in 1983 enacted a
“patrimony law” which declares all antiquities discovered
after the enactment of the statute to be the property of the Egyptian
government. The law provides for all antiquities privately owned prior to 1983
to be registered and recorded, and prohibits the removal of registered items
from Egypt. The law makes private ownership or possession of antiquities found
after 1983 illegal. Schultz’s primary argument is that the NSPA does
not apply to cases in which an object was “stolen” only in
the sense that it was possessed or disposed of by an individual in violation of
a national patrimony law, as opposed to “stolen” in the
commonly used sense of the word, for instance, where an object is taken from a
museum or a private collection. The government contends that the plain language
of the NSPA indicates that the NSPA
[*12] applies to any stolen property, regardless of the source of
the true owner’s title in the property. The question, in other words,
is whether an object is “stolen” within the meaning of the
NSPA if it is an antiquity which was found in Egypt after 1983 and retained by
an individual (and, in this case, removed from Egypt) without the Egyptian
government’s consent. The NSPA reads, in pertinent part, as follows: Whoever receives, possesses,
conceals, stores, barters, sells, or disposes of any goods, wares, or
merchandise, securities, or money of the value of $ 5,000 or more … which
have crossed a State or United States boundary after being stolen, unlawfully
converted, or taken, knowing the same to have been stolen, unlawfully
converted, or taken … shall be fined under this title or imprisoned not
more than ten years, or both. 18 U.S.C. § 2315 (2000). This statute is unambiguous. It applies to goods that are
“stolen, unlawfully converted, or taken.” Id. Goods that belong to
a person or entity and are taken from that person or entity without its consent
are “stolen” in every sense of that word. See, e.g.,
Black’s Law [*13]
Dictionary 989-90 (6th ed. abr. 1991) (defining
“stolen” as “acquired or possessed, as a result of
some wrongful or dishonest act or taking, whereby a person willfully obtains or
retains possession of property which belongs to another, without or beyond any
permission given, and with the intent to deprive the owner of the benefit of
ownership (or possession) permanently”); Webster’s Third New
International Dictionary 2248 (1971) (defining “stolen” as
“obtained or accomplished by theft, stealth, or craft”).
Accordingly, Schultz’s actions violated the NSPA if the antiquities he
conspired to receive in the United States belonged to someone who did not give
consent for Schultz (or his agent) to take them. That
“someone” is the nation of Egypt. In 1983, Egypt enacted Law 117. The law, which is entitled
“The Law on the Protection of Antiquities,” reads, in
pertinent part, as follows: Article 1 An “Antiquity”
is any movable or immovable property that is a product of any of the various
civilizations or any of the arts, sciences, humanities and religions of the
successive historical periods extending from prehistoric times down to a point
one hundred years [*14]
before the present, so long as it has either a value or importance
archaeologically or historically that symbolizes one of the various
civilizations that have been established in the land of Egypt or that has a
historical relation to it, as well as human and animal remains from any such
period. … Article 6 All antiquities are considered to
be public property - except for charitable and religious endowments… . It
is impermissible to own, possess or dispose of antiquities except pursuant to
the conditions set forth in this law and its implementing regulations. Article 7 As of [1983], it is prohibited to
trade in antiquities. … Article 8 With the exception of antiquities
whose ownership or possession was already established [in 1983] or is
established pursuant to [this law’s] provisions, the possession of
antiquities shall be prohibited as from [1983]. Law 117 includes a chapter entitled “Sanctions and Penalties”
detailing the criminal penalties to be imposed on persons found to have
violated the law. This section provides, inter alia, that a person who
“unlawfully smuggles an antiquity outside [*15] the Republic or participates in such an
act shall be liable to a prison term with hard labor and a fine of not less
than 5,000 and not more than 50,000 pounds.” A person who steals or
conceals a state-owned antiquity faces a prison term of three to five years and
a minimum fine of 3,000 pounds. A person who removes or detaches an antiquity
from its place, counterfeits an antiquity, or unlawfully disposes of an
antiquity faces a prison term of one to two years and a minimum fine of 100
pounds. A person who writes on, posts notices on, or accidentally defaces an
antiquity faces a prison term of three to twelve months and/or a fine of 100 to
500 pounds. Schultz moved in the district court to dismiss the indictment on the
ground that Law 117 did not vest true ownership rights in the Egyptian government,
and, accordingly, the items he conspired to smuggle out of Egypt were not
“stolen” within the meaning of the NSPA. In response to
Schultz’s motion, the district court conducted an evidentiary hearing
regarding Law 117 pursuant to Federal Rule of Criminal Procedure 26.1. n2 At
that hearing, two Egyptian officials testified as fact witnesses for the
government: Dr. Gaballa Ali Gaballa and
[*16] General Ali El Sobky. - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - - n2 Rule 26.1 reads, in pertinent part, as follows: “Issues of
foreign law are questions of law, but in deciding such issues acourt may
consider any relevant material or source — including testimony — without
regard to the Federal Rules of Evidence. “Fed. R. Crim. P. 26.1
(2003). The Advisory Committee Note to this Rule specifically acknowledges that
the Rule may be applicable where “the content of foreign law may …
be relevant in proceedings arising under 18 U.S.C. §§ 1201,
2312 to 2317.” Fed. R. Crim. P. 26.1 advisory committee’s
note. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - Dr. Gaballa is Secretary General of Egypt’s Supreme Council
of Antiquities, which is a part of the Ministry of Culture. The Supreme Council
employs more than 20,000 people. Dr. Gaballa was asked: “Who owns all
newly discovered antiquities?” He responded: “The Egyptian
government, of course.” Dr. Gaballa clarified that people who owned
antiquities prior to the adoption of Law 117 in 1983 are permitted to continue
to possess the [*17]
antiquities, but they may not transfer, dispose of, or relocate the
antiquities without notifying the Egyptian government. Dr. Gaballa testified
that pursuant to Law 117, when the Egyptian government learns that an antiquity
has been discovered, agents of the government immediately take possession of
the item. The item is then registered and given a number. In response to questioning by the court, Dr. Gaballa asserted that
there are no circumstances under which a person who finds an antiquity in Egypt
may keep the antiquity legally. The person who found the antiquity is not
compensated for the item, because it never belonged to the finder. The only
time compensation is paid is when a person owns a plot of land on which an
immovable structure is located, and the government takes possession of the
entire plot of land in order to possess the structure; in such a case, only the
value of the land itself, and not the value of the structure, is taken into
account in determining the amount of payment. The court also asked Dr. Gaballa whether Law 117 had been used to
bring legal actions against persons in Egypt who did not comply with the law,
but did not attempt to remove an antiquity from [*18] Egypt. Dr. Gaballa responded that he was
aware of cases in which Law 117 had been applied to persons whose violations of
the law took place entirely inside Egypt. The government’s second witness, General El Sobky, is the
Director of Criminal Investigations for the Egyptian Antiquities Police.
General El Sobky testified that his department, which employs more than 400
officers, regularly investigates and prosecutes people for violating Law 117.
General El Sobky testified that most of the Law 117 investigations and
prosecutions conducted by his department are of people who are trafficking in
antiquities within Egypt, as opposed to exporting them out of Egypt.
Furthermore, General El Sobky testified, even when a person is acquitted in
such a prosecution, if the person is found to possess an antiquity, that
antiquity is seized and retained by the government. Schultz called one expert witness at the hearing, Khaled Abou El Fadl,
a professor of Islamic and Middle Eastern law at the University of California -
Los Angeles (UCLA) Law School. Professor Abou El Fadl opined that Law 117 was
at times ambiguous and confusing. He further testified that the language of Law
117 did not make it [*19]
clear whether the law “intended to keep the antiquities inside
of Egypt or actually was asserting governmental ownership over the
antiquities.” Professor Abou El Fadl asserted that “nothing
in Law 117 prevents the Antiquities Authority from leaving physical possession
of even an antiquity discovered after 1983 in the hands of a private finder, so
long as the private finder promptly notifies the Authority of his find.” On cross-examination, Professor Abou El Fadl stated that he had never
practiced law in Egypt, nor was he licensed to practice law in Egypt. He
testified that he had never read Law 117 prior to being requested to do so by
Schultz’s counsel, and that he had been unable to locate any treatises
discussing Law 117. Schultz contends that in spite of its plain language, Law 117 is not a
“real” ownership law, and that Egypt does not truly claim
ownership over all antiquities, but merely seeks to restrict their export. The
district court disagreed, finding, based substantially on the testimony and
other evidence presented at the hearing, that the plain language of Law 117
accurately reflects its purpose and effect: to vest absolute and true ownership
of all antiquities found [*20] in
Egypt after 1983 in the Egyptian government. See Schultz, 178 F. Supp. 2d at
448. “Issues of foreign law are questions of law,” Fed. R.
Crim. P. 26.1 (2003), and accordingly we review the district court’s
findings regarding Law 117 de novo. See Curley v. AMR Corp., 153 F.3d 5, 11 (2d
Cir. 1998) (“[A] court’s determination of foreign law is treated
as a question of law, which is subject to de novo review.” (citing
parallel rule Fed. R. Civ. P. 44.1)). Schultz failed to present any evidence at the hearing or at trial that
Law 117 is not what its plain language indicates it is, that is, an ownership
law. Professor Abou El Fadl’s opinion that the law is ambiguous cannot
overcome the combination of (1) the plain text of the statute, and (2) the
testimony of two Egyptian government officials to the effect that the statute
is a true ownership law and is enforced as such. Although Professor Abou El
Fadl testified that he believed it would be possible for Egyptian authorities
to leave antiquities in the possession of private individuals who discovered
them, Schultz offered no evidence that the authorities ever actually had
permitted [*21] an individual to retain an antiquity
found after 1983. The Egyptian government officials testified that there was no
legal way for a private individual to retain possession of an antiquity
discovered after 1983, and that all such antiquities are seized by the
government. Law 117 defines “antiquity” and prescribes the
procedure to be followed by persons in possession of antiquities at the time
the Law takes effect, and by persons who discover antiquities thereafter. It
sets forth serious criminal penalties for the violation of its provisions. It
provides for licensure of certain foreign archaeological missions, and for
circumstances under which antiquities may be donated by the government to
foreign museums in appreciation of those missions’ work. The Law’s
provisions are directed at activities within Egypt as well as export of
antiquities out of Egypt. Law 117 makes it clear that the Egyptian government
claims ownership of all antiquities found in Egypt after 1983, and the
government’s active enforcement of its ownership rights confirms the
intent of the Law. Accordingly, we conclude that Law 117 is clear and
unambiguous, and that the antiquities that were the subject of the
conspiracy [*22] in this case
were owned by the Egyptian government. The question thus becomes whether Schultz’s actions in
conspiring to take antiquities owned by the Egyptian government pursuant to Law
117 out of Egypt violate the NSPA. Schultz argues that even if Law 117 does
intend to vest true ownership of all antiquities with the Egyptian government,
that sort of “ownership” should not be recognized by the
United States for purposes of prosecution under the NSPA. Schultz urges us to adopt a narrow reading of the NSPA. However, the
Supreme Court and this Court have acknowledged that the NSPA has a
“broad purpose,” McElroy v. United States, 455 U.S. 642, 655, 71 L. Ed.
2d 522, 102 S. Ct. 1332 (1982), and that “the statute should be
broadly construed,” United States v. Wallach, 935 F.2d 445, 469 (2d
Cir. 1991) (citing Moskal v. United States, 498 U.S. 103, 113, 112 L. Ed.
2d 449, 111 S. Ct. 461 (1990)). We have held that the language of the NSPA
“is broad enough to justify the federal courts in applying the statute
whenever they determine that the [property was] stolen in another
country.” United States v. Greco, 298 F.2d 247, 251 (2d Cir.
1962); [*23] see also United States v. Parness, 503 F.2d 430, 440
n.14 (2d Cir. 1974) (citing Greco with approval). Accordingly, there can be no
doubt that if the antiquities involved in the conspiracy were stolen in Egypt
and then shipped to the United States, the NSPA would be violated. Just as the property need not be stolen in the United States to bring
the NSPA into play, the fact that the rightful owner of the stolen property is
foreign has no impact on a prosecution under the NSPA. See United States v.
Frazier,
584 F.2d 790, 794 (6th Cir. 1978) (“The court ruled that even if it were
conceded that the defendants would be able to prove beyond a reasonable doubt
that” the victim was a foreign company, the NSPA would still apply.
“This was clearly a correct interpretation of the statute.”).
Furthermore, this Court has held that the NSPA applies to stolen property even
where the person from whom the property was stolen may not have been the true
owner of the property, and that the validity of the victim’s title in
the property is sometimes “irrelevant.” United States v.
Benson,
548 F.2d 42, 46 (2d Cir. 1977). n3 Accordingly, it does not [*24] matter that the antiquities at issue
here were stolen in a foreign country, or that their putative owner is a
foreign entity. - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - - n3 Benson involved a prosecution under a different section of the
NSPA, 18 U.S.C. § 2314, which prohibits the transport of stolen
property, as opposed to the receipt of stolen property, which is prohibited by
§ 2315. Our precedent interpreting § 2314 is persuasive in
considering § 2315, as the two sections merely address different
aspects of the same type of criminal behavior, namely dealing in stolen
property, and both are part of the same legislative scheme. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - Notwithstanding all of the above, Schultz insists that the antiquities
are not “stolen” within the meaning of the NSPA because they
were never truly owned by the Egyptian government. The leading opinion
addressing this question was issued by the Fifth Circuit, over 25 years ago, in
United States v. McClain, 545 F.2d 988 (5th Cir. 1977). The parties frame the
question on appeal [*25] as
whether the Second Circuit should adopt the reasoning set forth by the Fifth
Circuit in McClain. Schultz asserts that we should reject the holding in McClain based on existing
Second Circuit precedent, which he reads as being hostile to McClain. Schultz
then raises several additional arguments in support of his position, namely:
(1) that McClain’s approach conflicts with United States policy, (2)
that the enactment of the Convention on Cultural Property Implementation Act of
1983, 19 U.S.C. §§ 2601-2613 (CPIA), “confirms that
Congress never intended [the] NSPA to reach ownership claims based upon
national vesting laws when the property has not been reduced to the possession
of the foreign state,” and (3) that the common law definition of
“stolen” would not reach the property at issue here. We
address each of these arguments in turn. A. McClain in the Second Circuit The McClain defendants were convicted of conspiring to violate the
NSPA by importing artifacts from Mexico that were covered by a Mexican law
declaring all such artifacts to be owned by the Mexican government. See id. at 992. The [*26] defendants claimed, as Schultz does
here, that the NSPA did not apply to “stolen” objects that
were taken in violation of patrimony laws. See id. at 994. The Fifth
Circuit concluded that the NSPA did apply to such objects. n4 See id. at 996-97. - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - - n4 The McClain Court reversed the convictions on other grounds. See id. at 1003. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - The McClain Court cited precedent according an expansive meaning to the
term “stolen” in the NSPA, including United States v.
Handler,
142 F.2d 351, 353 (2d Cir. 1944), which held that embezzled property is
“stolen” within the meaning of the NSPA. See McClain, 545
F.2d at 995 (citing cases). The McClain Court also cited United States
v. Bottone,
365 F.2d 389, 393-94 (2d Cir. 1966). In Bottone, the defendants photocopied
documents detailing secret manufacturing processes, and transported the
photocopies across state lines. See Bottone, 365 F.2d at 391. The [*27] original documents were taken from the
rightful owner only briefly for copying, and were never transported in
interstate or foreign commerce. See id. at 393. The Court found that the
transport of the photocopies violated the NSPA, and the fact that the
photocopies were “never possessed by the original owner should be
deemed immaterial.” Id. at 393-94. The McClain Court also distinguished between mere unlawful export and
actual theft, holding that “a declaration of national ownership is
necessary before illegal exportation of an article can be considered theft, and
the exported article considered ‘stolen,’ within the meaning
of the [NSPA].” McClain, 545 F.2d at 1000-01. The court
engaged in a close study of the Mexican patrimony law, including its language,
history and purpose, and concluded that the Mexican government had made a
declaration of national ownership satisfying this standard. See id. at 997-1000. As
discussed above, Egypt has made a clear declaration of national ownership
through Law 117, and has enforced that law accordingly. Summarizing its decision in McClain, the Fifth Circuit stated: [*28] This conclusion is a result of our
attempt to reconcile the doctrine of strict construction of criminal statutes
with the broad significance attached to the word “stolen” in
the NSPA. Were the word to be so narrowly construed as to exclude coverage, for
example, with respect to pre-Columbian artifacts illegally exported from Mexico
after the effective date of the 1972 [patrimony] law, the Mexican government
would be denied protection of the [NSPA] after it had done all it reasonably
could do [to vest] itself with ownership to protect its interest in the
artifacts. This would violate the apparent objective of Congress: the
protection of owners of stolen property. If, on the other hand, an object were
considered “stolen” merely because it was illegally exported,
the meaning of the term “stolen” would be stretched beyond its
conventional meaning. Although “stealing” is not a term of
art, it is also not a word bereft of meaning. It should not be expanded at the
government’s will beyond the connotation depriving an owner of its
rights in property conventionally called to mind. McClain, 545 F.2d at 1001-02 (footnotes omitted). We agree that
the Fifth [*29] Circuit reached the proper balance
between these competing concerns in McClain. i. Hollinshead Although McClain is often described as the only federal appeals court
case to have considered the application of the NSPA to property deemed stolen
under a foreign patrimony law, the issue was actually first encountered by the
Ninth Circuit three years before McClain in United States v.
Hollinshead, 495 F.2d 1154 (9th Cir. 1974). The facts of Hollinshead are very similar to
those in the case at hand. “Hollinshead, a dealer in pre-Columbian
artifacts, arranged with one Alamilla, a co-conspirator, to procure such
artifacts in Central America, and to finance Alamilla in doing so.” Id. at 1155. Once the
artifacts were obtained, they were shipped to Hollinshead in the United States.
See id. Hollinshead was convicted of conspiracy to transport stolen property
in interstate and foreign commerce, in violation of 18 U.S.C. § 2314.
See id.
The trial centered on a particular artifact that had been found in a Mayan ruin
in the jungle of Guatemala and eventually shipped to Hollinshead. See id. The artifact was [*30] “stolen” as defined by
the NSPA because under Guatemalan law “all such artifacts are the
property of the Republic, and may not be removed without permission of the
government.” Id. As occurred in this case, the district court had
received testimony regarding the law of Guatemala as applied to such artifacts.
See id. The Ninth Circuit was not presented in Hollinshead with a direct attack
on the application of the NSPA to cases involving patrimony laws; that was not
the basis of the defendant’s appeal. However, the Ninth
Circuit’s discussion indicates its acceptance of the
prosecution’s theory in Hollinshead: that an object is
“stolen” within the meaning of the NSPA if it is taken in
violation of a patrimony law. See id. at 1156. We are aware of no
other federal appeals court that has reached this issue. The Second Circuit has rarely addressed McClain, and has never decided
whether the holding of McClain is the law in this Circuit. See United States
v. Long Cove Seafood, 582 F.2d 159, 163, 165 (2d Cir. 1978) (Long Cove); United
States v. An Antique Platter of Gold, 184 F.3d 131, 134 (2d Cir. 1999)
(Steinhardt). [*31] n5 Although Schultz asserts that these
cases support his position, we disagree with his interpretation of these
precedents. - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - - n5 We also cited to McClain, without discussion, in United
States v. Bennett, 665 F.2d 16, 22 (2d Cir. 1981). - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - ii. Long Cove The defendants in Long Cove were charged with violating the NSPA by
taking undersized clams from Long Island Sound and selling them to area
restaurants. See Long Cove, 582 F.2d at 161, 162. There was no dispute that the
practice of harvesting and selling undersized clams violated various
environmental laws; the question was whether the transport of these clams
across state lines constituted the interstate transport of
“stolen” goods under the NSPA. See id. at 162-63. The
government argued that the clams were “stolen” from the State
of New York because of a New York law that provides: The State of New York owns all
fish, game, wildlife, shellfish, crustacea and protected insects in the
state, [*32] except those legally acquired and held
in private ownership. Any person who kills, takes or possesses such fish, game,
wildlife, shellfish, crustacea or protected insects thereby consents that title
thereto shall remain in the state for the purpose of regulating and controlling
their use and disposition. Id. at 164 (quoting N.Y. Envtl. Conserv. Law § 11-0105). The Court stated that the key question was “whether New York
has asserted a true ownership interest in wildlife such as the Fifth Circuit,
in [McClain], held that Mexico has done since 1972 with respect to pre-Columbian
artifacts. We think not.” Id. at 165. The Court emphasized
that the New York statute stated that the purpose of asserting ownership was
only to regulate and control the use and disposition of wildlife, not to
actually take possession of it. See id. The Court further noted that
while New York claimed to own the wildlife, it was not liable for an attack by
any wild animal, as a private owner of such an animal would be. See id. The distinctions between the facts of the Long Cove case and the facts of
the case at hand are clear and require a different [*33] outcome here. First, as the testimony
before the district court made clear, Egypt does assert a possessory interest
in antiquities pursuant to Law 117. While the State of New York has never
attempted to seize all wildlife found within its borders, Dr. Gaballa testified
that the Egyptian government actively pursues any person found to have obtained
an antiquity and takes immediate possession of all antiquities of which it
becomes aware. Second, both Dr. Gaballa and General El Sobky confirmed that the
purpose of Law 117 is to bring all newly discovered antiquities within the
direct possession and control of the Egyptian government in order to ensure
that they are properly preserved and documented. Hundreds of antiquities police
are employed by the Egyptian government solely to effectuate this purpose. To
the contrary, the purpose of the New York law is simply to control the use and
disposition of wildlife. See Long Cove, 582 F.2d at 164-65. Third, the New York law explicitly excepts those wildlife
“legally acquired and held in private ownership.” Id. at 164. Law 117
provides for no exceptions for private ownership of antiquities discovered [*34] after the effective date of the law. n6
It is legal under certain circumstances for a private person to obtain and
dispose of wildlife in New York, for instance, by obtaining a hunting, fishing
or trapping license. See, e.g., N.Y. Envtl. Conserv. Law § 11-0701(4)
(McKinney 2003) (“A fishing license entitles the holder to take fish by
angling, spearing, hooking, longbow and tip ups, to take frogs by spearing,
catching with the hands or by use of a club or hook, and to take bait fish for
personal use.”). When a licensed hunter or fisherman catches wildlife in
New York, it is his to keep and dispose of as he chooses. - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - - n6 Law 117 does provide an exception for antiquities “whose
ownership or possession was already established at the time the law came into
effect.” Schultz argues that this provision renders Law 117 ambiguous,
because it suggests that the Egyptian government does not truly intend to own
all antiquities; we cannot agree. Schultz’s expert, Professor Abou El
Fadl, testified that Egypt has a constitutional provision which, like the
United States Constitution, prohibits the taking of private property by the
government without compensation. Providing an exception to the general rule of
government ownership for those who already had legal possession of antiquities
prior to the adoption of Law 117 avoids the problem of having to pay
compensation to those private owners. Viewed in this light, the exception
actually supports the government’s position that Law 117 represents an
effort to obtain true ownership and actual possession of all antiquities; if
Law 117 were merely an export law, there would be no need to exempt existing
owners, as their property rights would not be affected as long as they made no
attempt to export their antiquities. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - [*35] In Egypt, on the other hand, it is impossible for a private party to
get a license to obtain, possess or dispose of antiquities. Law 117 does
provide in Article 34 for “foreign missions” to receive
archaeological exploration and excavation licenses. However, Article 35 states
that “all antiquities discovered by foreign archaeological excavation
missions shall be state owned.” If the Antiquities Authority
determines that the foreign mission is “outstanding,” and has
performed “important excavation and restoration work,” the
Authority may reward the mission by donating certain antiquities which
“are expendable by reason of their similarity to other items excavated
from the same location.” Even then, the donated antiquities must be
“thoroughly examined and fully recorded,” and may only be
donated to a museum, not to the excavators themselves. We also note that in Long Cove we were not called upon to rule
directly on the application of the NSPA to property owned pursuant to a
patrimony law, and we did not question the correctness of McClain. Long Cove cited McClain more than once, in a
positive light, which is significant in light of the considerable publicity the
Fifth [*36] Circuit’s controversial
holding in McClain had generated at the time. See Long Cove, 582 F.2d at 163, 165.
These citations give no indication that the Court disapproved of the outcome or
analysis of McClain. iii. Steinhardt Schultz also contends that our decision in Steinhardt indicates that
we have rejected the holding of McClain. In Steinhardt, the district court had
found that an Italian antiquity should be forfeited by Steinhardt, who had
imported it into the United States, because (1) Steinhardt had made material
misrepresentations on a customs form or, (2) in the alternative, the antiquity
was properly owned by the Italian government pursuant to a patrimony law and
was therefore stolen property within the meaning of the NSPA and subject to
forfeiture. See Steinhardt, 184 F.3d at 134. On appeal, we concluded that Steinhardt
had made a material misstatement on a customs form when he represented that the
antiquity was from Switzerland, not Italy. See id. at 137. Accordingly,
the Court concluded that the antiquity was subject to forfeiture. n7 See id. at 138. The Court
declined to reach [*37]
the alternative ground relied on below, stating: “We need not
… address whether the NSPA incorporates concepts of property such as those
contained in the Italian patrimony laws.” Id. at 134. - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - - n7 Steinhardt involved the application of 18 U.S.C. § 545. As
we explained: Section 545 prohibits the
importation of merchandise into the United States “contrary to
law” and states that material imported in such a manner
“shall be forfeited.” 18 U.S.C. § 545. The
government claims that the importation of [the Italian antiquity] was illegal
because it violated 18 U.S.C. § 542, which prohibits the making of
false statements in the course of importing merchandise into the United States. Steinhardt, 184 F.3d at 134-35 (internal footnote omitted). - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - It is irrelevant that we previously reviewed a case in which it was
not necessary to reach the question now before us. It is not at all uncommon
for us [*38] to decline to reach an issue when the
case before us can be resolved on other grounds. See, e.g., Wexner v. First
Manhattan Co., 902 F.2d 169, 174 (2d Cir. 1990) (“In light of our
determination that the district court should be affirmed on other grounds, we
find it neither necessary nor appropriate to reach this issue today.”). Our
failure to address a question that is not necessary to the outcome of a case is
simply a wise exercise of our discretion. See United States v. United States
Gypsum Co333
U.S. 364, 402, 92 L. Ed. 746, 68 S. Ct. 525 (1948) (Frankfurter, J.,
concurring in part) (“Deliberate dicta, I had supposed, should be
deliberately avoided. Especially should we avoid passing gratuitously on an
important issue of public law where due consideration of it has been crowded
out by complicated and elaborate issues that have to be decided.”). n8 We
find Schultz’s reliance on Steinhardt unpersuasive. - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - - n8 The dangers inherent in a court’s reaching out to decide
issues not essential to the outcome of the case before it were perhaps most
colorfully described by the 19th century English jurist Lord Justice Bowen, who
has been quoted by our Supreme Court as saying: I am extremely reluctant to decide
anything except what is necessary for the special case, because I believe by
long experience that judgments come with far more weight and gravity when they
come upon points which the Judges are bound to decide, and I believe that
obiter dicta, like the proverbial chickens of destiny, come home to roost
sooner or later in a very uncomfortable way to the Judges who have uttered
them, and are a great source of embarrassment in future cases. Darr v. Burford, 339
U.S. 200, 214, 94 L. Ed. 761, 70 S. Ct. 587 (1950), overruled in part on other
grounds by Fay v. Noia, 372
U.S. 391, 9 L. Ed. 2d 837, 83 S. Ct. 822 (1963). - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - [*39] B. United States Policy Schultz contends that it is United States policy not to enforce the
export restrictions of foreign nations. Schultz offers no evidence in support
of this assertion, but even if his assessment of United States policy is
accurate, the outcome of this case is unaffected. We have already concluded,
based on the plain language of Law 117 and the evidence in the record, that Law
117 is an ownership law, not an export-restriction law. Two Egyptian officials
testified under oath that the law is used in Egypt to prosecute people for
trafficking in antiquities within Egypt’s borders. Law 117 provides
for a minimum five-year prison term and a fine of 3,000 pounds for persons
convicted of “theft or concealment of a state owned
antiquity.” Persons convicted of smuggling an antiquity out of Egypt
face “a prison term with hard labor and a fine of not less than 5,000
and not more than 50,000 pounds.” Clearly, theft or concealment of an
antiquity within Egypt is a different offense than smuggling an antiquity out
of Egypt, and both are prohibited by Law 117. Accordingly, even if Schultz’s
interpretation of American policy is accurate, it is not relevant here. [*40] While Law 117 does restrict exportation
of cultural objects, its scope is not limited to export restrictions. Law 117
is more than an export regulation — it is a true ownership law. C. The CPIA Schultz contends that the adoption of the CPIA shows that Congress did
not intend the NSPA to apply to objects such as the ones he conspired to bring
to the United States. The CPIA implements a United Nations convention that was
ratified by the United States in 1982, the purpose of which was to achieve
“greater international cooperation towards preserving cultural
treasures that not only are of importance to the nations whence they originate,
but also to greater international understanding of our common
heritage.” S. Rep. No. 97-564, at 21 (1982). The CPIA provides a mechanism for the American government to establish
import restrictions on “cultural property” at the request of
another signatory nation and after a determination by the President that (1)
“the cultural patrimony of [the requesting nation] is in jeopardy from
the pillage of archaeological or ethnological materials of [that
nation],” (2) the requesting nation “has taken measures …
to protect its cultural patrimony,
[*41] “ (3) the import restrictions are necessary and
would be effective in dealing with the problem, and (4) the restrictions are in
the “general interest of the international community.” 19 U.S.C.
§ 2602(a)(1)(A)-(D) (2003). Schultz argues that the CPIA was intended to be the only mechanism by
which the United States government would deal with antiquities and other
“cultural property” imported into the United States. However,
nothing in the language of the CPIA supports that interpretation, and the
legislative history shows that exactly the converse is true. As the district
court correctly noted, Schultz, 178 F. Supp. 2d at 449, the Senate Report on the
CPIA expressly states that the CPIA “neither pre-empts state law in
any way, nor modifies any Federal or State remedies that may pertain to
articles to which [the CPIA’s] provisions … apply.” S.
Rep. No. 97-564, at 22 (1982). Furthermore, the Senate Report states that the
CPIA “affects neither existing remedies available in state or federal
courts nor laws prohibiting the theft and the knowing receipt and
transportation of stolen property in interstate and foreign commerce (e.g., [*42] National Stolen Property Act, Title 18,
U.S.C. Sections 2314-2315).” Id. at 33 (emphasis added). The CPIA also bars the importation of items that have been stolen from
a museum or other cultural institution in a foreign signatory nation. See 19
U.S.C. § 2607. Schultz argues that because only those items that are
stolen from specified places are covered by the CPIA, Congress never intended
in any way to limit the import of items “stolen” only in the
sense that they were taken in violation of patrimony laws. This argument is
unpersuasive. The CPIA does not state that importing objects stolen from
somewhere other than a museum is legal. If, for instance, an artifact covered
by the CPIA were stolen from a private home in a signatory nation and imported
into the United States, the CPIA would not be violated, but surely the thief
could be prosecuted for transporting stolen goods in violation of the NSPA. The CPIA is an import law, not a criminal law; it is not codified in
Title 18 (“Crimes and Criminal Procedure”), with the NSPA, but in Title
19 (“Customs Duties”). It may be true that there are cases in which a
person will [*43] be
violating both the CPIA and the NSPA when he imports an object into the United
States. But it is not inappropriate for the same conduct to result in a person
being subject to both civil penalties and criminal prosecution, and the
potential overlap between the CPIA and the NSPA is no reason to limit the reach
of the NSPA. See, e.g., Hudson v. United States, 522 U.S. 93, 98-99, 139 L. Ed. 2d 450, 118 S.
Ct. 488 (1997) (holding that a person may be subjected to civil and criminal
penalties for the same conduct without violating the Double Jeopardy Clause). For the reasons set forth above, we conclude that the passage of the
CPIA does not limit the NSPA’s application to antiquities stolen in
foreign nations. n9 - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - - N9 Schultz notes that Senator Moynihan stated, after the adoption of
the CPIA, that part of the compromise reached in passing that law included an
agreement to later amend the NSPA to overrule McClain. See 131 Cong. Rec.
S2598-03 (Mar. 6, 1985). Senator Moynihan introduced legislation on two occasions
which would have done just that; however, neither bill passed. Accordingly,
although it may have been Senator Moynihan’s belief that the Congress
intended to overrule McClain in separate legislation after the adoption of the
CPIA, that never actually happened. We note that this history further supports
our holding that the CPIA itself did nothing to overrule McClain or alter the effect of
the NSPA with regard to foreign antiquities. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - [*44] D. Common Law Definition of “Stolen” Schultz argues that the Court must look to the common law definition
of “stolen” to determine whether the antiquities at issue are
covered by the NSPA. n10 Schultz cites United States v. Turley, 352
U.S. 407, 1 L. Ed. 2d 430, 77 S. Ct. 397 (1957), in which the Supreme Court
considered the meaning of the term “stolen” in the context of
the statute that served as the precursor and model for the NSPA. See id. at 410-11. The
Supreme Court stated: “We recognize that where a federal criminal
statute uses a common-law term of established meaning without otherwise
defining it, the general practice is to give that term its common-law
meaning.” Id. at 411. Schultz contends that interpreting the NSPA to
apply to items that are “stolen” in the sense that they are
possessed by a defendant in violation of a foreign patrimony law would be in
derogation of the common law. However, in Turley, the Supreme Court explicitly
recognized that “‘stolen’ (or ‘stealing’)
has no accepted common-law meaning.” Id. If “stolen”
has no common law meaning, we cannot look to the common law to assist us in
interpreting [*45]
that term. - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - - n10 Schultz also argues that because a thing can only be
“stolen” if it is already owned, then the term
“ownership” is implied in the NSPA (although that word never
appears anywhere in the text of the NSPA), and accordingly, we must determine
the common law meaning of “ownership.” We decline to accept
this invitation to delve into the meaning of a term that is not even present in
an unambiguous statute. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - The Supreme Court also stated in Turley that the term
“stolen” included “all felonious takings …
regardless of whether or not the theft constitutes common-law
larceny.” Id. at 417. In other words, according to the Supreme Court,
the precursor to the NSPA — and by extension the NSPA -- covers a
broader class of crimes than those contemplated by the common law. Accordingly,
we find this argument unpersuasive. E. Summary In light of our own precedents and the plain language of the NSPA, we
conclude that the NSPA applies to property that is stolen in violation of a
foreign [*46] patrimony law. The CPIA is not the
exclusive means of dealing with stolen artifacts and antiquities, and reading
the NSPA to extend to such property does not conflict with United States
policy. We believe that, when necessary, our courts are capable of evaluating
foreign patrimony laws to determine whether their language and enforcement
indicate that they are intended to assert true ownership of certain property,
or merely to restrict the export of that property. In this case, the district
court carefully evaluated the language of Law 117. The court also heard
testimony from one academic expert and two Egyptian government officials. This
evidence was sufficient to inform the court of the nature of Egypt’s
interest in the antiquities that were the subject of the conspiracy. Although we recognize the concerns raised by Schultz and the amici
about the risks that this holding poses to dealers in foreign antiquities, we
cannot imagine that it “creates an insurmountable barrier to the
lawful importation of cultural property into the United States.” Our holding
does assuredly create a barrier to the importation of cultural property owned
by a foreign government. We see no reason that [*47] property stolen from a foreign
sovereign should be treated any differently from property stolen from a foreign
museum or private home. The mens rea requirement of the NSPA will
protect innocent art dealers who unwittingly receive stolen goods, while our
appropriately broad reading of the NSPA will protect the property of sovereign
nations. II. Defense of Mistake of United States Law Schultz argues on appeal that the district court erred in refusing to
allow him to present a defense of mistake of law. Specifically, Schultz sought
to argue to the jury that he did not know that importing antiquities owned by
the Egyptian government pursuant to Law 117 violated the NSPA. n11 The
government contends that the district court was correct to bar this defense,
relying on “the venerable principle that ignorance of the law
generally is no defense to a criminal charge.” Ratzlaf v. United
States,
510
U.S. 135, 149, 126 L. Ed. 2d 615, 114 S. Ct. 655 (1994). - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - - n11 This argument is referred to by the parties as the
“mistake of American law defense.” Schultz was permitted to
present a “mistake of Egyptian law defense” to the jury. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - [*48] Schultz concedes that this is the general rule, but asserts that
certain exceptions exist. Schultz cites three cases in which he contends that
the Supreme Court found a defense of mistake of law was proper: Ratzlaf, 510 U.S. at 137
(“To establish that a defendant ‘willfully violated’ the
anti-structuring law, the Government must prove that the defendant acted with
knowledge that his conduct was unlawful.”); Cheek v. United States, 498
U.S. 192, 200, 112 L. Ed. 2d 617, 111 S. Ct. 604 (1991) (interpreting
“the statutory term ‘wilfully’ as used in the
federal criminal tax statutes as carving out an exception to the traditional
rule” that mistake of law is no defense); and Liparota v. United
States,
471
U.S. 419, 426, 85 L. Ed. 2d 434, 105 S. Ct. 2084 (1985) (reading food stamp
fraud provision to include a requirement that the defendant knew that his
actions were unlawful, where “to interpret the statute otherwise would
be to criminalize a broad range of apparently innocent conduct”). In addition, Schultz cites two federal appellate decisions from other
circuits. In United States v. Lizarraga-Lizarraga, 541 F.2d 826 (9th
Cir. 1976), [*49]
the Ninth Circuit reversed a defendant’s conviction for illegal
export of ammunition to Mexico because the district court had failed to
instruct the jury that the defendant could be convicted only if he knew it was
illegal to transport ammunition to Mexico. See id. at 828. Similarly, in
United States v. Grigsby, 111 F.3d 806 (11th Cir. 1997), the Eleventh Circuit
reversed the conviction of a defendant for illegally importing elephant tusks
because the district court had failed to instruct the jury that the defendant could
be convicted only if he knew importing the items was illegal. See id. at 821, 834. Each of
the cases relied on by Schultz is inapposite, for two reasons. First, these decisions involve specific intent statutes. For instance,
the statute at issue in Lizarraga (now repealed) made it unlawful
“willfully” to export certain items to Mexico. See Lizarraga, 541 F.2d at 827. The
inclusion of the term “willfully,” the court found, made it
clear that Congress intended to punish only those who exported ammunition
knowing it was unlawful to do so. See id. at 828. Likewise, the statute
of [*50] conviction in Grigsby specified that
“whoever knowingly violates section 4223 of this title” would
be subject to criminal penalties. 16 U.S.C. § 4224 (2000) (emphasis
added). The tax statute at issue in Cheek and the antistructuring statute
at issue in Ratzlaf each also specified that only defendants who
“willfully” violated the law would be subject to prosecution.
See 26 U.S.C. §§ 7201, 7203; 31 U.S.C. § 5322. The NSPA does not include the term “willfully.” The
section of the NSPA applicable to Schultz reads as follows: Whoever receives, possesses,
conceals, stores, barters, sells, or disposes of any goods, wares, or
merchandise, securities, or money of the value of $ 5,000 or more … which
have crossed a State or United States boundary after being stolen, unlawfully
converted, or taken, knowing the same to have been stolen, unlawfully
converted, or taken … shall be fined under this title or imprisoned not
more than ten years, or both. 18 U.S.C. § 2315 (2000) (emphasis added). The only knowledge
requirement in the NSPA is knowledge
[*51] that the goods were “stolen, unlawfully converted,
or taken.” Id.; see United States v. Rosa, 17 F.3d 1531, 1546
(2d Cir. 1994) (noting that the NSPA does not require knowledge that an item
traveled in interstate or foreign commerce, but “does include a mens
rea
element with respect to the status of the goods as having been stolen”); Godwin
v. United States, 687 F.2d 585, 588 (2d Cir. 1982) (“A violation of 18
U.S.C. § 2315 normally requires simply the act of receiving or
disposing of stolen goods of the requisite value moving in interstate commerce,
coupled with knowledge that the goods are stolen.”). A defendant
charged with violating the NSPA may argue that he did not know a certain fact
that made his conduct criminal, that is, that he did not know the objects in
question were stolen. Schultz’s “mistake of Egyptian
law” defense goes to that issue. However, if a jury finds that a
defendant knew all of the relevant facts, the defendant cannot then escape
liability by contending that he did not know the law. Second, the cases cited by Schultz are inapposite because each
concerns conduct that normally might not
[*52] be considered unlawful. The Lizarraga Court, for instance,
emphasized that in enacting the statute of conviction, Congress “did
not intend to criminally penalize innocent or negligent errors.” Lizarraga, 541 F.2d at 828. The
Supreme Court’s primary concern in Liparota was that the statute
under consideration in that case not be read in such a way as “to
criminalize a broad range of apparently innocent conduct.” Liparota, 471 U.S. at 426. In addition, the record demonstrates that Schultz’s actions
were not “innocent” or merely “negligent.”
This is not a case in which the defendant believed that he was doing something
lawful, and was surprised to find that his conduct could result in criminal
sanctions. To the contrary, Schultz was conspiring to smuggle antiquities out
of Egypt and into the United States. He was defrauding (or attempting to
defraud) potential buyers; the Thomas Alcock Collection story was invented by
Schultz and Parry for the sole purpose of deceiving people as to the origin of
the antiquities and when they had been taken out of Egypt. Schultz continued to
do business in this manner even after his partners, Parry and [*53] Farag, had been arrested. Furthermore,
Schultz and Parry demonstrated a keen awareness of the illegality of their
actions by communicating in “code,” forging documents, and
even explicitly discussing the possibility that one or more of them might end
up imprisoned. n12 - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - - n12 The jury heard substantial evidence indicating that Schultz was
actually aware that the NSPA had been applied to objects stolen in violation of
a patrimony law. Specifically, it appears that Schultz was aware of the McClain decision. In 1994, Schultz was contacted by the Turkish government. The Turkish
government requested that Schultz detail the provenance of several items in his
gallery that the Turkish authorities believed to be of Turkish origin. In this
correspondence, the Turkish government noted that all antiquities found in
Turkey are the property of the Turkish government under a patrimony law.
Schultz, acting through counsel, refused to cooperate with Turkey in this
inquiry, claimed that Schultz had no knowledge that any Turkish artifacts in
his possession were stolen, and referred to the McClain case. Schultz concedes in his appellate brief that the McClain decision was
“well publicized.” Schultz was an owner of a gallery dealing
in antiquities, and was once the president of the National Association of
Dealers in Ancient, Oriental and Primitive Art, suggesting that he would be
aware of all significant developments in the field. Accordingly, even if Schultz had been permitted to present this
defense, it is unlikely that the jury would have credited it. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - [*54] We conclude that the district court did not err in denying
Schultz’s request to present a defense of mistake of American law. The
jury did not have to find that Schultz knew what he was doing was illegal. As
long as the jury found beyond a reasonable doubt that Schultz knew the
antiquities were “stolen,” the jury, following the law, would
have been required to convict Schultz even if it believed he had misunderstood
American law. III. Conscious Avoidance Jury Instruction Prior to Schultz’s trial, the government requested that the
court charge the jury on the doctrine of conscious avoidance, and submitted a
proposed jury instruction on that issue. The district court included an
instruction on conscious avoidance in its charge, which was provided to the
parties prior to the charge conference, but the court’s charge did not
use the language suggested by the government. Schultz did not object to the use
of a conscious avoidance charge or to the specific language proposed by the
district court. On appeal, Schultz contends that the district court’s
instruction to the jury on the doctrine of conscious avoidance was erroneous. A. Standard of Review “Because defendant did
[*55] not object to the charge at trial, our review is for plain
error.” United States v. Bala, 236 F.3d 87, 94 (2d Cir. 2000);
see also Fed. R. Civ. P. 56(b). The parties agree that this is the proper
standard of review. To establish plain error, a court must find 1) an error, 2) that is
plain, 3) that affects substantial rights… . If an error meets these first
three requirements, the Court engages in a fourth consideration: whether or not
to exercise its discretion to correct the error. The plain error should be
corrected only if it seriously affects the fairness, integrity, or public
reputation of judicial proceedings. United States v. Keigue, 318 F.3d 437, 441-42 (2d Cir.
2003) (internal citations and quotation marks omitted); see also United States
v. Gore, 154 F.3d 34, 43 (2d Cir. 1998) (“A ‘plain’ error is
an error so egregious and obvious as to make the trial judge and prosecutor
derelict in permitting it, despite the defendant’s failure to
object.”). Schultz “bears the burden of persuasion to show that
the district court’s charge amounts to plain error.” United
States v. Vasquez, 267 F.3d 79, 87 (2d Cir. 2001). [*56] “We do not review portions of [jury] instructions in isolation,
but rather consider them in their entirety to determine whether, on the whole,
they provided the jury with an intelligible and accurate portrayal of the
applicable law.” United States v. Weintraub, 273 F.3d 139, 151 (2d
Cir. 2001). B. The District Court’s Instruction The district court charged the jury as follows: [A] defendant may not purposefully
remain ignorant of either the facts or the law in order to escape the
consequences of the law. Therefore, if you find that the defendant, not by mere
negligence or imprudence but as a matter of choice, consciously avoided
learning what Egyptian law provided as to the ownership of Egyptian
antiquities, you may [infer], if you wish, that he did so because he implicitly
knew that there was a high probability that the law of Egypt invested ownership
of these antiquities in the Egyptian government. You may treat such deliberate
avoidance of positive knowledge as the equivalent of such knowledge, unless you
find that the defendant actually believed that the antiquities were not the
property of the Egyptian government. Schultz argues, correctly,
[*57] that the Second Circuit has “repeatedly emphasized
that, in giving the conscious avoidance charge, the district judge should
instruct the jury that knowledge of the existence of a particular fact is
established (1) if a person is aware of a high probability of its existence,
(2) unless he actually believes that it does not exist.” United
States v. Feroz, 848 F.2d 359, 360 (2d Cir. 1988) (per curiam). In Schultz’s
estimation, the charge given by the district court failed to convey these
essential points to the jury. The government concedes that the language of the
charge did not precisely mirror the language set out in prior Second Circuit
cases, but contends that the charge as given was sufficiently clear and
contained all of the necessary elements. We have stated before that “no jury instruction is ever
perfect.” United States v. Joyner, 313 F.3d 40, 47 (2d Cir. 2002).
We do not review a jury instruction to determine whether it precisely quotes
language suggested by Supreme or Appellate Court precedent. Instead, we review
the court’s instructions to determine whether “considered as
a whole, [the instructions] adequately communicated [the essential] [*58] ideas to the jury.” United
States v. Velez-Vasquez, 116 F.3d 58, 61 (2d Cir. 1997). “We cannot
place the talismanic weight urged by [the defendant] on [the] exact wording [of
a controlling opinion] and do not believe the district court needed to echo the
opinion paragraph by paragraph to convey adequately its import to the jury.”
United States v. Schatzle, 901 F.2d 252, 255 (2d Cir. 1990); see also United
States v. Beech-Nut Nutrition Corp., 871 F.2d 1181, 1196 (2d Cir. 1989) (finding no
error in conscious avoidance charge even though it “arguably”
could have led the jury to draw an “unwarranted inference”); United
States v. McBride, 786 F.2d 45, 51 (2d Cir. 1986) (finding no error in
conscious avoidance charge because “the charge made reference to
purposeful avoidance of the truth, awareness of a high probability of the fact
at issue, and the absence of the defendant’s actual belief in the
nonexistence of the crucial fact”); cf. DeFalco v. Bernas, 244 F.3d 286, 312
n.16 (2d Cir. 2001) (finding no plain error where, “although the
language of the jury instruction [was] not ideal,” the [*59] charge as a whole did not reveal
“an error ‘so serious and flagrant that it goes to the very
integrity of the trial,’ or one that ‘deprived the jury of
adequate legal guidance to reach a rational decision’”); Owen v.
Thermatool Corp., 155 F.3d 137, 139 (2d Cir. 1998) (finding no error in jury charge
that failed to use the “more precise and more typical”
phrasing set forth in precedent, because charge “adequately stated the
law”). Here, the charge given by the district court adequately stated the law
of conscious avoidance. The court set forth both essentials required by Feroz. The charge informed
the jury that it could find conscious avoidance only if it found both (1) that
Schultz avoided gaining actual knowledge “because he implicitly knew
that there was a high probability that the law of Egypt invested ownership of
these antiquities in the Egyptian government” and (2) that Schultz did
not “actually believe[] that the antiquities were not the property of
the Egyptian government.” The court also gave a “good
faith” instruction and reiterated, immediately after giving the
conscious avoidance charge, that Schultz could be found guilty only if the
jury [*60] found that he had participated in the
conspiracy “knowing that it contemplated the acquisition and/or sale
of antiquities that had been stolen from Egypt.” (emphasis added). It is true that the district court’s instructions on this
point could “have been more precise.” United States v.
Bonito,
57 F.3d 167, 174 (2d Cir. 1995). “At trial, had objection been lodged
to the imprecision, the judge would have been well advised to correct it. But
on appeal, and in light of the charge as a whole, we see no error so obvious
and seriously prejudicial to [the defendant’s] substantial rights as
to constitute plain error.” Id. The instruction as given was
sufficient to inform the jury of the law of conscious avoidance, and did not
constitute plain error. n13 - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - - n13 Even if the instruction were plain error, it is not at all clear
that Schultz could meet his weighty burden of establishing that the error
affected the outcome of the trial, in light of the sufficient evidence
introduced to permit a rational jury to infer that Schultz had actual knowledge
of Law 117. Furthermore, permitting Schultz’s conviction to stand
would not seriously affect the fairness or integrity of judicial proceedings. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
[*61]
IV. Admission of Testimony of Witnesses Other than Schultz Regarding
Their Personal Knowledge of Law 117 Schultz contends that the district court erred in permitting the
government to elicit testimony from five witnesses — James Romano and
Edna Russman, curators of the Brooklyn Museum of Art; Edmund Pillsbury, head of
the Kimbell Museum; Blake Woodruff, a former employee of Schultz; and Betsy
Bryan, a professor of Egyptology — regarding those witnesses’
personal knowledge of Law 117. Schultz objected to this testimony in the
district court; it appears that the basis for the objection was that the
testimony was irrelevant. “The standard of review applicable to the
evidentiary rulings of the district court is abuse of discretion.” Old
Chief v. United States, 519
U.S. 172, 174 n.1, 136 L. Ed. 2d 574, 117 S. Ct. 644 (1997). “Unless
a district court’s determination of relevance is arbitrary or
irrational, it will not be overturned.” Conway v. Icahn & Co., 16 F.3d 504, 511 (2d
Cir. 1994). “‘Relevant evidence’ means evidence having
any tendency to make the existence of any fact that is of consequence to the
determination of the action more probable
[*62] or less probable than it would be without the
evidence.” Fed. R. Evid. 401 (2002). There is no dispute that the fact
of Schultz’s knowledge of Law 117 “is of consequence to the
determination of the action” at hand. Id. The only question is
whether the district court abused its discretion in determining that this
testimony had “any tendency” to make that fact “more
probable or less probable.” The government contends that this testimony was relevant to the
question whether Schultz was aware of Law 117 because evidence that the Law was
widely known among those in Schultz’s field tended to make it more
probable that Schultz, who had worked in the field for decades, also knew about
it. Furthermore, as the government emphasizes, each of the witnesses that was
asked about his or her own knowledge of Law 117 had dealt directly with
Schultz. Schultz had offered to sell “George” and the
Amenhotep sculpture to James Romano and Edmund Pillsbury, respectively, using
the Thomas Alcock Collection story. Schultz provided false information about
the Amenhotep sculpture to Betsy Bryan, and showed “George”
to Edna Russman, telling her it came from an old collection. Blake Woodruff had
been employed [*63] by
Schultz at Schultz’s art gallery. The district court concluded that
these witnesses’ testimony tended to show that “even an ignoramus
in this field would know at least about patrimony laws.” Schultz relies on United States v. Patrisso, 262 F.2d 194 (2d Cir.
1958). n14 In Patrisso, one of the defendants, Mankes, was convicted of
knowingly possessing stolen property, in part on the strength of evidence that
the person who sold the goods to Mankes knew the goods were stolen. See id. at 195, 197. The
Court reversed the conviction, finding that the evidence admitted regarding
Mankes’ co-defendants’ knowledge that the property was stolen
was prejudicial to Mankes. See id. at 198. Patrisso is not on
point, for at least three reasons. - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - - n14 Schultz also relies on Cheek and Liparota, contending that because
the Supreme Court never suggested that it would have been possible for the
government to call witnesses to testify to their own knowledge of the facts at
issue, such testimony is not permissible. This argument is without merit. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - [*64] First, Patrisso is not a relevance case. The Court never held that the
evidence admitted was irrelevant as to Mankes, only that it was so prejudicial
to him as to be inadmissible. See id. at 197. Here, the defendant has
argued that the evidence was not admissible because it was irrelevant, not
because it was prejudicial. Second, the factual circumstances of the Patrisso case differed
materially from those present here. In Patrisso, the Court noted that Mankes’
behavior was not consistent with consciousness of guilt; he made no effort to
conceal the stolen property. See id. at 198. As noted above,
Schultz’s behavior indicated a consciousness that his actions were
illegal in some way. Mankes, however, was at least four steps removed from the
actual theft: Patrisso obtained the property from the person who stole it and
sold the property to Ellis; Ellis sold the property to Postrel; Postrel sold
the property to Mankes. See id. at 196. Schultz, on the other hand, was actively
involved in obtaining the antiquities, smuggling them out of Egypt, and
disguising their true origins. The nature of the property at issue in Patrisso [*65] — television tubes —
was not such that a person would naturally inquire about its source, whereas
the evidence in this case established that persons considering purchasing
Egyptian antiquities make extensive inquiries into the provenance of the
antiquities. Third, and most important, the type of knowledge at issue in Patrisso
is materially different than the type of knowledge at issue here. Schultz was
an acknowledged expert in the field of Egyptian antiquities, with many years of
experience. It would have been natural for Schultz to know about Law 117. To
the contrary, it would not have been natural for Mankes’ co-defendants to
tell him that the goods he was buying were stolen, and there was no other
possible way for Mankes to have obtained that knowledge. Knowledge of a duly
adopted, widely publicized, and vigorously enforced law such as Law 117 is
quite different from knowledge of the specific theft of a specific product in
Patrisso. Testimony from colleagues who worked with Schultz as to their own
understanding of Egyptian law “was relevant both to explain the
practice of the industry in which this prosecution arose and to establish what
someone with [the defendant’s]
[*66] extended background in the industry probably would
know.” United States v. Leo, 941 F.2d 181, 197 (3d Cir.
1991). “Evidence need not be conclusive in order to be relevant.”
Contemporary Mission v. Famous Music Corp., 557 F.2d 918, 927 (2d Cir.
1977). “Nonconclusive evidence should still be admitted if it makes a
proposition more probable than not; factors which make evidence less than
conclusive affect only weight, not admissibility.” S.E.C. v.
Singer,
786 F. Supp. 1158, 1166 (S.D.N.Y. 1992). Schultz’s defense at trial
was that he was unaware of the existence of Law 117. Evidence that those with
whom Schultz dealt in the antiquities profession knew of Law 117, and
particularly that Schultz’s own employee knew of the Law, goes
directly to the plausibility of Schultz’s defense.
“Determinations of relevance are entrusted to the sound discretion of
the trial judge.” United States v. Quiroz, 13 F.3d 505, 514 (2d
Cir. 1993). Here, we see no abuse of that discretion. CONCLUSION We conclude that the NSPA applies to property that is stolen from a
foreign government, where that government asserts actual ownership of the
property [*67] pursuant to a valid patrimony law. We
find the remainder of Schultz’s claims to be without merit.
Accordingly, the judgment of the district court is hereby affirmed. |