United States v. Bailey

123 F.3d 1381, 1997 U.S. App. LEXIS 26289
Court of Appeals for the Eleventh Circuit·Decided September 24, 1997·No. 18-11306·Published·Cited by 218 cases

Opinion

BIRCH, Circuit Judge:

In this appeal, a firearms dealer challenges his conviction for mail fraud relating to his purchase and sale of automatic and semiautomatic weapons to law enforcement agencies and to private customers, operation of his firearms business without a license, and possession of machineguns in violation of 18 U.S.C. § 922(o) on the bases of sufficiency of the evidence, the constitutionality of section 922(o), and prosecutorial misconduct. We affirm his conviction. His sentence, which was imposed under the incorrect version of the Sentencing Guidelines and is the.subject of the government’s cross appeal, is vacated, and the case is remanded for resentencing.

I. BACKGROUND

In the summer of 1986, appellant, cross appellee, Thomas G. Bailey, became a federally licensed firearms dealer 1 and obtained *1385 additional authority to sell machineguns to law enforcement agencies. 2 In February, 1989, Bailey contracted with Heckler and Koch (“H & K”), a firearms manufacturer based in Germany, which makes machine-guns and semiautomatic assault rifles, 3 to become a law enforcement firearms dealer for the company. Under the terms of this contract, Bailey was not permitted to stock weapons for future sale to police departments; he had authority to act only as a middleman, who ordered from H & K the particular weapons requested by his law enforcement customers. 4 The contract further specified that H & K would sell weapons to Bailey without including federal excise tax in the price, because the weapons were to be sold to law enforcement customers solely. 5 Bailey testified that he understood that his contract with H & K and federal law prohibited his selling machineguns and assault rifles to civilians and that he understood the federal excise tax scheme, which subjected all firearms, except those sold to law enforcement agencies, to federal excise tax.

In July, 1989, Bailey met Wayne Bass, the Acting Chief of Police of Wauchula, Florida. Chief Bass told Bailey that he might want to buy a small number of assault rifles for his eight-man police department, and Bailey offered to obtain the weapons. Because of the ATF assault weapons ban and the restrictive *1386 terms of Bailey’s contract with H & K, Bailey instructed Bass to write a letter authorizing Bailey to buy weapons on behalf of the Wau-chula Police Department from H & K. Bailey mailed to Chief Bass a sample letter that authorized Bailey “‘to place any order for any H & K full or semi-auto firearm, provided they are shipped directly to the department. The weapons and/or accessories will be used for law enforcement purposes.’ ” 1 Supp. R5-45-46 (quoting letter). When he read the sample letter, Chief Bass testified that he “was a little bit concerned — or not a little bit, I was quite concerned with the way it stated — its open-endedness.” Id. at 46. Chief Bass particularly objected to the reference in the letter to automatic weapons, because he had told Bailey from the outset that the Wauchula Police Department “was not interested in full automatic firearms.” Id. at 47.

When Chief Bass telephoned Bailey to express his concerns, Bailey told him that H & K wanted the letters to be open-ended to encompass all H & K products. Bailey then suggested that Chief Bass modify the letter to allow the weapons to be shipped directly to him rather than to the Wauchula Police Department. Chief Bass agreed and sent Bailey a letter of authorization, but he warned Bailey that “he must fully understand that we would only be hable for any weapon that was specifically ordered.” Id. at 49. Furthermore, Chief Bass made it “crystal clear” that the Wauchula Police Department would be interested in buying such weapons only in the future, if at all, “because our budget was so small that there were a lot of much more needed equipment to be bought for that department than ... these exotic firearms.” Id. at 50. Wauchula’s total budget for new equipment for that year was approximately $5,000. The Wauchula Police Department never ordered any weapons from Bailey.

On September 29, 1989, Bailey used the letter of authorization sent by Chief Bass to order $30,000 of weapons from H & K, including twenty-five assault rifles (two HK 91s, two HK 93s, and twenty-one HK 94s), two pistols, a shotgun, a sniper rifle, and $6,000 of accessories. He informed H & K that the weapons were for the Wauchula Police Department. While the shotgun, sniper rifle, and-pistols were sent immediately to Bailey, H & K requested and obtained approval from ATF to import assault rifles to the Wauchula Police Department. In November, 1989, H & K called Chief Bass to confirm the order of the twenty-five assault rifles for the police department. Chief Bass told H & K “that the Wauchula Police Department had not ordered any guns from H & K and I had no idea why that order was in the Wauchula Police Department’s name.” Id. at 54. He also called the ATF Tampa office. Based on Chief Bass’s message, H & K did not ship the assault weapons. Bailey’s conduct regarding the Wauchula Police Department resulted in his conviction on mail fraud charges in Counts II through IV of the amended, second superseding indictment.

Also in mid 1989, Joel Hodges, Assistant Commander of the Clay County, Florida Sheriffs Department SWAT team, met Bailey. At that time, the Clay County SWAT team was using HK MP5s, machineguns manufactured by H & K. Because these weapons had been manufactured and lawfully possessed prior to 1986, and, thus, could be sold to and possessed by individuals under the provisions of 18 U.S.C. § 922(o)(2)(B), Bailey offered to trade three new MP5s for three of the Clay County Sheriffs Department old MP5s, and Sergeant Hodges agreed. He also expressed interest in looking at a single HK 91 assault rifle, although he did not authorize Bailey to buy this weapon for him.

In September, 1989, Bailey dictated to Sergeant Hodges an open-ended letter of authorization allowing Bailey to purchase weapons from H & K on behalf of Clay County Sheriffs Department. Sergeant Hodges signed the letter, which authorized Bailey “ ‘to place on [Sergeant Hodges’s] behalf an order for H & K restricted [automatic] firearms and accessories which will be used for law enforcement purposes only.’” Id. at 94 (quoting' letter). Sergeant Hodges wrote a similar letter authorizing Bailey to obtain semiautomatic weapons and accessories from H & K. In addition to the three MP5s actually requested by Clay County Sheriffs Department, Bailey ordered the following weapons from H & K and represented that they also *1387

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United States v. Bailey, 123 F.3d 1381, 1997 U.S. App. LEXIS 26289 (11th Cir. 1997).

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