US v. Romero-Lopez

Filing

OPINION issued by Michael Boudin, Appellate Judge; Bruce M. Selya, Appellate Judge and Timothy Belcher Dyk, Appellate Judge. Published. [10-1775]

Case: 10-1775

Document: 00116432171

Page: 1

Date Filed: 09/17/2012

Entry ID: 5675470

United States Court of Appeals
For the First Circuit

No. 10-1775
UNITED STATES OF AMERICA,
Appellee,
v.
JOSE ROMERO-LOPEZ,
Defendant, Appellant.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO
[Hon. Francisco A. Besosa, U.S. District Judge]
Before
Boudin, Selya and Dyk,*
Circuit Judges.
Jorge Luis Armenteros-Chervoni, for appellant.
Maritza González-Rivera, Assistant United States Attorney,
with whom Rosa Emilia Rodriguez-Velez, United States Attorney,
Nelson Pérez-Sosa, Assistant United States Attorney, and Thomas F.
Klumper, Assistant United States Attorney, were on brief, for
appellee.

September 17, 2012

___________
*Of the Federal Circuit, sitting by designation.

Case: 10-1775

Document: 00116432171

Page: 2

DYK, Circuit Judge.

Date Filed: 09/17/2012

Entry ID: 5675470

Defendant-Appellant José Romero-

López (“Romero”) was convicted after jury trial of money laundering
offenses in violation of 18 U.S.C. §§ 1956 and 982.

On appeal,

Romero contends that he is entitled to a new trial based on errors
committed by the district court.

Romero asserts that his due

process rights were violated when the district court advanced the
scheduled trial date by one day and that the district court erred
in allowing the prosecution to present evidence relating to his tax
returns and his activities and detention by federal authorities
when traveling through the San Diego airport.

We find no merit to

Romero’s contentions, and affirm his conviction.
I.
On September 16, 2009, in the United States District
Court for the District of Puerto Rico, Romero was charged by a
grand

jury

indictment

in

a

charged

forty-one
one

count

count

of

criminal
conspiracy

indictment.
to

commit

The
money

laundering in violation of 18 U.S.C. § 1956(h), thirty-nine counts
of money laundering in violation of 18 U.S.C. §§ 1956(a) and 2, and
one count of money laundering forfeiture under 18 U.S.C. § 982.
The indictment alleged that beginning in or about 2000 through
about 2005, Romero had engaged in various activities designed to
conceal

the

proceeds

of

approximately $1.4 million.

unlawful

drug

activity

totaling

Romero pleaded not guilty to all

-2-

Case: 10-1775

Document: 00116432171

Page: 3

Date Filed: 09/17/2012

Entry ID: 5675470

counts, and the district court scheduled trial for November 23,
2009.
Five days before the scheduled trial date, the district
court advised the parties that due to a scheduling conflict, trial
would be “placed on the trial-ready calendar” and notified the
parties that “[t]he parties and counsel shall be ready to try this
case with 24-hours notice on or before January 20, 2010.”

Order,

United States v. Romero-Lopez, No. 09-304 (D.P.R. Nov. 18, 2009),
ECF No. 24.

In response to scheduling concerns voiced by defense

counsel,1 the court subsequently set a firm trial date of December
15, 2009.

On December 1, 2009, the district court advanced the

trial date by one day to December 14, 2009.

On December 9, 2009,

defense counsel filed a motion to continue trial to March 2010,
which was denied by the district court on the day it was filed.
The following day, defense counsel filed a motion to reinstate the
previously scheduled trial date of December 15, 2009, contending
that “changing the date of trial without prior notice, particularly
if it cuts days for preparation, [is] a violation of due process.”
Motion to Reinstate Trial Original Scheduling at 2, United States
v. Romero-Lopez, No. 09-304 (D.P.R. Dec. 10, 2009), ECF No. 33.
1

Defense counsel advised the district court that he might
have a potential scheduling conflict because he had two federal
criminal trials scheduled for December 7 and 8, 2009, a federal
civil trial scheduled for January 4, 2010, and an additional state
criminal trial that might also conflict with the court’s “trialready” order. Accordingly, counsel requested that the court set a
firm trial date.
-3-

Case: 10-1775

Document: 00116432171

Page: 4

Date Filed: 09/17/2012

Entry ID: 5675470

Defense counsel also noted in the motion that he had a child
custody hearing scheduled for December 19, 2009.

Id.

This motion

was also denied.
As scheduled, a jury trial commenced on December 14,
2009.

However,

during

the

course

of

the

trial,

on

defense

counsel’s motion, the court continued trial from December 18 to
December 21, 2009, due to “severe health problems” faced by defense
counsel.
During trial, the government presented evidence that
Romero, along with his business partner, Miguel Reyes, also known
as “Chino,” operated two businesses--one a legitimate sandwich shop
and the other an illegal money-laundering scheme designed to
conceal the proceeds of illegal drug activity.

The government

presented the testimony of several witnesses to establish that
Romero

and

Chino

sent

money

by

California to pay for marijuana.

wire

transfer

to

San

Diego,

The government also established

that after Chino was murdered in 2003, Romero continued to wire
transfer money to San Diego.

The government’s theory was that

Romero used his legitimate sandwich shop business to accomplish his
money-laundering scheme by having his sandwich shop employees wire
transfer funds to San Diego on his behalf after Chino’s death.

The

period of the alleged conspiracy and illegal activity was from 2000
to 2005, including both the period when Romero sent wire transfers

-4-

Case: 10-1775

Document: 00116432171

Page: 5

Date Filed: 09/17/2012

Entry ID: 5675470

at Chino’s behest and the period when Romero transferred money
after Chino’s death.
Among

the

government’s

witnesses

were

two

former

employees of Romero’s sandwich shop business, Miguel Rosa-Muriel
(“Rosa”) and Luís Díaz-Berríos (“Díaz”),who testified that Romero
had directed them to wire transfer money to San Diego.

According

to Rosa and Díaz, following Chino’s death, Romero directed them to
transfer a

total

of $60,500

and $79,500,

respectively.

The

government, through the testimony of an official from the Treasury
Department of Puerto Rico, also introduced Romero’s tax returns for
2001 through 2004, which showed the income that he reported in
those years from his sandwich shop business. The government argued
that the limited revenues for the sandwich shop business shown on
the returns were insufficient to explain the wire transfers.
Romero

was

the

sole

witness

for

the

defense.

He

testified that Chino gave him money and directed him to wire
transfer it to San Diego, but that Chino never told him the purpose
behind the wire transfers or what type of business Chino had in San
Diego.

As to the wire transfers made after Chino’s death in 2003,

Romero testified that following Chino’s death, Chino’s cousin
Alexis came to him and told him that he had to continue sending
money, and gave him the money to send.

In short, the defense’s

theory was that Romero had no knowledge that the transfers were
made to conceal illegal activity and that he was merely performing

-5-

Case: 10-1775

Document: 00116432171

Page: 6

Date Filed: 09/17/2012

Entry ID: 5675470

a favor for his friend and business partner, Chino (and later
Alexis).
On cross-examination, the government inquired about the
income that Romero reported on his tax returns for 2000 through
2004, which showed net incomes of only $2,216, $7,206, $4,147,
negative $7,642, and $35,069, in 2000, 2001, 2002, 2003, and 2004,
respectively.

The government then asked Romero about the money

that he wire transferred to San Diego, as well as the money that
Rosa and Díaz had sent to San Diego on Romero’s behalf.

The

government’s theory apparently was that although Romero was sending
large sums of money to San Diego, he reported only minimal income
from his legitimate business, implying that the money that was sent
to San Diego was derived from his illegitimate business. Following
this line of questioning, the government then questioned Romero
about a 2005 trip that he took with his wife to San Diego in which
he was detained while carrying six money orders and $4,000 in cash.
The government elicited that the money was seized by federal
agents, and that Romero never attempted to claim the money after
his release.
On December 22, 2009, the jury returned a verdict finding
Romero guilty of all counts, and finding that $257,000 should be
forfeited by Romero. Romero was sentenced to one hundred thirtyfive months of imprisonment and ordered to forfeit $257,000 as

-6-

Case: 10-1775

Document: 00116432171

Page: 7

Date Filed: 09/17/2012

Entry ID: 5675470

proceeds derived from the offenses for which he was convicted.
Romero timely appealed.

II.
On appeal, Romero does not challenge the sufficiency of
the evidence to support his conviction.

He argues only that he is

entitled to a new trial due to three errors committed by the
district court.

Specifically, he alleges that the district court

erred by (1) advancing the scheduled trial date by one calendar
day, (2) admitting evidence of his tax returns for 2001 to 2004,
and (3) allowing the government to question him regarding his 2005
trip to San Diego.

We address each of Romero’s claims in turn.
A.

Romero contends that his due process rights were violated
when the district court advanced the scheduled trial date by one
day from December 15 to December 14, 2009.

Romero argues that he

was prejudiced because his counsel had a custody hearing scheduled
for December 14, 2009 (though as we discuss below, this date is not
reflected in the record), and his counsel’s trial preparation was
therefore disrupted due to the stress involved in the scheduling
conflict and the need to resolve it.

We review the district

court’s trial management decisions for abuse of discretion, as
“[i]t is the province of the district court to manage its docket,
and, within that province, to decide what constitutes a reasonable

-7-

Case: 10-1775

Document: 00116432171

Page: 8

period of time for preparation.”

Date Filed: 09/17/2012

Entry ID: 5675470

United States v. Ottens, 74 F.3d

357, 359 (1st Cir. 1996) (internal citation omitted); see also
United

States

v.

Williams,

630

F.3d

44,

48

(1st

Cir.

2010)

(reviewing the district court’s denial of a continuance for abuse
of discretion).

An abuse of discretion is “found only where the

Court exhibited an unreasonable and arbitrary insistence upon
expeditiousness in the face of a justifiable request for delay.
However,

the

district

court’s

discretion

is

limited

by

the

defendant[’s] constitutional rights to effective assistance of
counsel and to the testimony of defense witnesses.”
v.

Mangual-Santiago,

562

F.3d

411,

429-30

(1st

United States
Cir.

2009)

(alteration in original) (internal quotation marks and citation
omitted).
Although “[n]ormally, one would expect a district court
judge to grant a continuance of a trial in order to avoid an
inadvertent

scheduling

conflict,”

United

States

v.

Flecha-

Maldonado, 373 F.3d 170, 175 (1st Cir. 2004), we conclude that the
district court did not abuse its discretion in advancing trial by
one day.

Trial had been originally scheduled to commence on

November 23, 2009.

From the time of the district court’s November

18 “trial-ready” order, defense counsel was fully aware that the
case could proceed to trial at any moment and should have prepared
accordingly.

It was not until December 10, four days before the

December 14 trial date, that defense counsel informed the court of

-8-

Case: 10-1775

his

Document: 00116432171

conflicting

custody

Page: 9

hearing,

Date Filed: 09/17/2012

which

counsel

Entry ID: 5675470

asserted

was

scheduled for December 19, and not December 14, as Romero now
claims on appeal.2

Thus rescheduling trial to begin on December

15, rather than on December 14 would not have alleviated counsel’s
purported scheduling conflict.
Furthermore, counsel has pointed to no way in which an
additional twenty-four hours of preparation would have made a
significant difference.
trial and

actively

Counsel appeared for the first day of

participated.

The

fact

that

counsel

was

apparently disciplined for failing to appear at the state court
child custody hearing on that same date has no bearing on the
propriety of the district court’s scheduling order.

As we have

previously noted, “[a] defendant is generally not entitled to a new
trial unless he or she can identify specific ways in which the
court’s erroneous denial of a continuance prejudiced his or her
defense.”

Mangual-Santiago, 562 F.3d at 430.

We find no error in

the district court’s decision to advance the trial date by one day.
B.
We turn now to the two evidentiary issues.
district

court’s

scheduling

decision,

we

review

As with the
the

court’s evidentiary decisions for abuse of discretion.

2

district
United

At oral argument, defense counsel contended that he
informally advised the district court that the scheduled date for
the child custody hearing was in fact December 14. See Oral Arg.
at 0:45. However, counsel provided no record evidence to support
this contention.
-9-

Case: 10-1775

Document: 00116432171

Page: 10

Date Filed: 09/17/2012

States v. Hall, 434 F.3d 42, 56 (1st Cir. 2006).

Entry ID: 5675470

Romero argues

that the district court impermissibly admitted (1) evidence as to
his tax returns and (2) testimony regarding his trip to San Diego
and detention by federal authorities as prior bad acts, which are
prohibited to prove character by Federal Rule of Evidence 404(b).3
Rule 404(b) provides that “[e]vidence of a crime, wrong,
or other act is not admissible to prove a person’s character in
order to show that on a particular occasion the person acted in
accordance

with

the

character.”

Fed.

R.

Evid.

404(b)(1).

Nonetheless, such evidence “may be admissible for another purpose,
such as proving motive, opportunity, intent, preparation, plan,

3

Romero also contends that the government failed to comply
with the district court’s scheduling order by not “provid[ing]
reasonable notice in advance of trial of any Rule 404(b) evidence.”
Scheduling Order at 3, United States v. Romero-Lopez, No. 09-304
(D.P.R. Sept. 23, 2009), ECF No. 9; see also Fed. R. Evid.
404(b)(2)(A) (“On request by a defendant in a criminal case, the
prosecutor must . . . provide reasonable notice of the general
nature of any such [404(b)] evidence that the prosecutor intends to
offer at trial.”). Romero failed to raise this issue before the
district court, so we review it for plain error. See United States
v. Sanchez-Berrios, 424 F.3d 65, 73 (1st Cir. 2005).
In any event, we see no error, plain or otherwise.
The
government filed a notice of intent to use Romero’s tax returns
well in advance of trial and, as discussed below, evidence
concerning Romero’s trip to San Diego was used to refute Romero’s
testimony that he lacked knowledge of the purpose of the charged
money laundering scheme. In other words, the San Diego trip was
introduced to establish an element (knowledge) of the charged
offense. “Rule 404(b) applies just to evidence of other bad acts
or crimes--those other than the crime charged. Where evidence of
‘bad acts’ is direct proof of the crime charged, Rule 404(b) is, of
course, inapplicable.” Mangual-Santiago, 562 F.3d at 425.
-10-

Case: 10-1775

Document: 00116432171

Page: 11

Date Filed: 09/17/2012

Entry ID: 5675470

knowledge, identity, absence of mistake, or lack of accident.”
Fed. R. Evid. 404(b)(2). This court has previously explained that
The admissibility of “other acts” evidence depends on a
two-part analysis. First, “other acts” evidence must be
excluded if “it is relevant only because it shows bad
character (i.e., the proposed logical inference includes
character as a necessary link).” Second, the district
court must weigh the probative value of the “other acts”
evidence against any unfair prejudice to the defendant;
and it is only when the risk of unfair prejudice
“substantially” outweighs its probative value that the
evidence is to be excluded.
United

States

v.

Shenker,

933

F.2d

61,

63

(1st

Cir.

1991)

(citations omitted). We first address whether admission of the tax
returns was impermissible under Rule 404(b).
Romero

asserts

that

the

government

offered

his

tax

returns in order to show that he had failed to comply with
reporting requirements required by the Treasury Department of
Puerto Rico.

However, the record is clear that the government’s

reliance on Romero’s tax records for years corresponding to those
in which the conspiracy took place was primarily to establish, not
that he failed to report income on his tax returns, but rather that
the money that he was sending to San Diego was not money derived
from his legitimate sandwich shop business, but instead was the
proceeds of illegal activity.4

In responding to defense counsel’s

4

The one exception to this occurred when the government
cross-examined Romero on whether he reported money that he
admittedly received from Chino for making the wire transfers ($100
per transfer for a total of $5,100 over a five year period). See
Transcript of Trial at 59-64, United States v. Romero-Lopez, No.
09-304 (D.P.R. Dec. 21, 2009), ECF No. 107.
Defense counsel
-11-

Case: 10-1775

Document: 00116432171

Page: 12

Date Filed: 09/17/2012

Entry ID: 5675470

objection to the admission of the tax returns, the government
explained:
Your Honor, [the tax returns] go[] to the elements of the
offense in the sense that he is charged with using drug
money proceeds to promote and to further drug trafficking
violations. And that is why -- that is the source -- We
are going to the source of the funds. And, of course,
what he reports as income is inextricably intertwined
what [sic] he is sending, it is part and parcel. He’s
saying that this is his income, and the version that we
heard is that it was for family members, so, of course,
we have to show that there was an unexplained wealth.
Transcript of Trial at 18, United States v. Romero-Lopez, No. 09304 (D.P.R. Dec. 16, 2009), ECF No. 106.

Furthermore, during

closing arguments, the government argued to the jury, “[w]hen you
look at the totals in the tax returns and you look at the totals of

objected to this line of questioning on relevance grounds, but was
overruled by the district court.
As a general rule, failure to report income on tax returns is
relevant evidence in a money laundering conspiracy case, see, e.g.,
Mangual-Santiago, 562 F.3d at 429. While it is debatable whether
the facts of this case fit the general rule, any possible error in
admitting this line of questioning was patently harmless,
especially given Romero’s testimony that he did report the income
on his tax returns, see United States v. Williams, 985 F.2d 634,
638 (1st Cir. 1993) (“Having reviewed the entire record and
considered the probable impact of the error on the minds of the
jurors, we conclude with fair assurance, after pondering all that
happened without stripping the erroneous action from the whole,
that the [jurors’] judgment was not substantially swayed by the
error.” (alteration in original) (internal quotation marks
omitted)). The government’s line of questioning certainly does not
rise to the level of reversible prosecutorial misconduct.
See
United States v. Gentles, 619 F.3d 75, 81 (1st Cir. 2010)
(“[M]isconduct alone is insufficient to reverse a conviction absent
a showing of prejudice. To determine if prejudice resulted, ‘the
test is whether the prosecutor’s misconduct so poisoned the well
that the trial’s outcome was likely affected, thus warranting a new
trial.’” (citation omitted) (quoting United States v. Azubike, 504
F.3d 30, 39 (1st Cir. 2007))).
-12-

Case: 10-1775

Document: 00116432171

Page: 13

Date Filed: 09/17/2012

Entry ID: 5675470

the wire transfer, you will see that it is thousands and thousands
of dollars in cash that were sent to San Diego over and over. . . .
What was the source of this wealth that was being sent to San
Diego?

I submit to you that the evidence has shown that the source

was marijuana.”

Transcript of Trial at 28, United States v.

Romero-Lopez, No. 09-304 (D.P.R. Dec. 22, 2009), ECF No. 115.
Thus, the government’s reliance on the tax returns was
not designed to demonstrate Romero’s character, but rather to
establish an element of the money laundering offense–-that the
concealed proceeds were derived from illegal activity.5

To be

sure, the defendant’s testimony was that the money transferred was
from Chino and Alexis, and there was no testimony that this money
was sandwich shop revenue.

But the government was entitled to

refute any possible argument that the wired funds were sandwich
shop revenue.

See United States v. Evans, 697 F.2d 240, 248 n.8

(8th Cir. 1983) (noting that it was not error for the court to
admit Rule 404(b) evidence in its case in chief where the evidence
was tendered to rebut an anticipated defense).

5

Because the tax

See Mangual-Santiago, 562 F.3d at 428 (noting that the
elements of conspiracy to commit money laundering are that the
defendant agreed with another to “1) knowingly conduct a financial
transaction 2) involving funds that [the defendant] knew to be the
proceeds of some form of unlawful activity and 3) that were in fact
the proceeds of a ‘specified unlawful activity,’ and 4) that [the
defendant] knew the transactions to be designed in whole or in part
to conceal or disguise the nature, location, source, ownership, or
control of the proceeds of such unlawful activity.” (alterations in
original) (first and second emphases added)).
-13-

Case: 10-1775

Document: 00116432171

Page: 14

Date Filed: 09/17/2012

Entry ID: 5675470

returns were admitted for “another purpose,” they were not subject
to automatic exclusion under Rule 404(b).

Furthermore, we find

that the potential probative value of the tax returns substantially
outweighs the risk of unfair prejudice to the defendant. Thus, the
district

court

committed

no

abuse

of

discretion

in

allowing

admission of Romero’s tax returns for the years in which the
conspiracy was alleged to have taken place.6
C.
Romero also urges that the district court erred by
allowing the government to question him as to his 2005 trip and
detention by federal authorities in San Diego.

In particular,

Romero argues that if the government wished to tie this incident to
the conspiracy, it should have brought evidence as to this incident
during

the

incident

up

government’s
solely

case-in-chief,

during

its

rather

than

cross-examination

of

bring

the

Romero.

Reviewing the record as a whole, it is apparent that one of the
principal purposes of the government’s line of questioning was to
refute Romero’s contention that he had no knowledge of why Chino

6

Romero also seems to contend that the government failed
to establish how much gross income (rather than net income) he
earned during the time period in question, i.e., Romero argues that
the money that was being transferred could be accounted for by
looking to the gross income reported on the tax returns. However,
this argument goes to the weight, rather than the admissibility of
the tax records. Indeed, Romero’s counsel cross-examined the
government’s witness from the Treasury Department on this very
point.
-14-

Case: 10-1775

Document: 00116432171

Page: 15

Date Filed: 09/17/2012

Entry ID: 5675470

had asked him to transfer money to San Diego or that the money was
the proceeds of illegal activity.
During Romero’s testimony on direct examination, his
counsel asked him about his knowledge of the money laundering
conspiracy:
Q And when, in fact, did you realize what was going on with
Chino and Alexis?
A

When I was accused of this in this mess. . . .

Q . . . Now, sir, when, if at any time, did Chino tell you
about what business he had in California?
A

No, he never gave me an explanation.

Q

And why did you keep on sending these money orders?

A Because he asked me to. And my understanding was when I
went to Western Union that there was nothing illegal involved
in that.
Transcript of Trial at 32-33, United States v. Romero-Lopez, No.
09-304 (D.P.R. Dec. 21, 2009), ECF No. 107.

On cross-examination,

Romero also testified that he did not know the people to whom he
sent the wire transfers.

See id. at 48-49.

In order to rebut this testimony, the government inquired
about his trip to San Diego in 2005, which was within the time
period of the conspiracy.

The fact that Romero traveled to San

Diego (the same city where he had wire transferred funds), during
the time period of the alleged conspiracy, with a large sum of cash
and money orders, was certainly relevant to refute his lack of
knowledge.

In response to defense counsel’s objection under Rule

-15-

Case: 10-1775

Document: 00116432171

Page: 16

Date Filed: 09/17/2012

Entry ID: 5675470

404(b), the government explained, “He was detained with money and
wire transfers [sic].

He just said that he didn’t -- he didn’t

know what the money was coming from and didn’t know who these
people were. . . . I think it’s within the scope of the conspiracy
-- He took the stand, and he can be cross-examined about his
knowledge.”

Id. at 53.

Furthermore,

as

the

government

pointed

out

in

its

closing, the jury could draw a reasonable inference that Romero
failed to claim this money once he was released “because if he
claimed it, he had to prove that it was legal . . . [and] he let it
go because it was no savings. It was drug money proceeds.”
Transcript of Trial at 40, Romero-Lopez, No. 09-304, ECF No. 115.
Although

the

fact

that

Romero

had

been

detained

by

federal

authorities (who also confiscated his money) during this trip may
give rise to an inference of bad character within the meaning of
Rule 404(b), that suggestion does not outweigh the probative value
of this testimony as to the issue of Romero’s knowledge that the
funds he transferred were derived from illegal activity.

See Fed.

R. Evid. 404(b)(2) (evidence of other acts admissible to prove
“motive,

opportunity,

intent,

preparation,

plan,

knowledge,

identity, absence of mistake, or lack of accident” (emphasis
added)).

We find no abuse of discretion in the district court’s

decision to allow questioning on this incident.

-16-

Case: 10-1775

Document: 00116432171

Page: 17

Date Filed: 09/17/2012

Entry ID: 5675470

III.
For the foregoing reasons, we discern no error in the
district court’s scheduling or evidentiary rulings.
Romero’s conviction is affirmed.

Affirmed.

-17-

Accordingly,