Kelly v. USA

Filing 9

OPINION & ORDER. Kelly's petition for a writ of habeas corpus is denied. In addition, the Court declines to issue a certificate of appealability. Kelly has not made a substantial showing of a denial of a federal right, and appellate review is t herefore not warranted. Love v. McCray, 413 F.3d 192, 195 (2d Cir. 2005). The Court also finds pursuant to 28 U.S.C. § 1915(a) (3) that any appeal from this Order would not be taken in good faith. Coppedge v. United States, 369 U.S. 438, 445 (1962). The Clerk of Court shall dismiss this petition and close the case. (Signed by Judge Denise L. Cote on 7/25/2012) Copies Mailed By Chambers. (lmb)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
----------------------------------------X
THOMAS M. KELLY,
:
Petitioner,
:
:
-v:
:
UNITED STATES OF AMERICA,
:
:
Respondent.
:
----------------------------------------X

12 Civ. 0628 (DLC)
09 Cr. 163 (DLC)
OPINION & ORDER

APPEARANCES:
For the petitioner:
Thomas M. Kelly, pro se
Reg. # 61413-054
201 Queensberry Court
Pittsburgh, PA 15237
For the Government:
Sarah Y. Lai
United States Attorney’s Office
One St. Andrew’s Plaza
New York, NY 10007

DENISE COTE, District Judge:
Thomas M. Kelly (“Kelly”) has filed a petition for a writ
of habeas corpus pursuant to 28 U.S.C. § 2255.

Kelly entered a

plea of guilty to fraud, was sentenced principally to a term of
imprisonment of twenty-one months, and is currently on
supervised release.
denied.

For the following reasons, the petition is

BACKGROUND
Kelly was the Executive Director for the Community for
Education Foundation (“CEF”), a non-profit organization that
provided materials and services designed to teach life skills to
public school children.

Kelly diverted about $53,000, which a

school district owed CEF, to an account in the name of the
Downtown Jersey City Scholarship Fund (the “Fund”).

Kelly

controlled the Fund and withdrew the money for his own use and
to lend to an acquaintance.
Kelly was arrested on September 23, 2008, and on February
20, 2009 was indicted for mail and wire fraud offenses.

Count

Two, the wire fraud count to which Kelly pleaded guilty, reads
in pertinent part:
Between in or about 2006 and in or about March 2008,
[Kelly] devised and carried out a scheme to
fraudulently obtain money for himself from CEF by (i)
diverting, through false representations, payments
that were owed to CEF to a bank account that Kelly
controlled and (ii) diverting most of the proceeds of
those payments to his personal benefit.
Kelly executed a plea agreement with the Government dated
July 27, 2009 (the "Agreement").

Among other things, the

Agreement represented that the Government would not further
prosecute Kelly for misuse of CEF’s American Express card in
consideration for his plea.
the amount of $50,571.

Kelly agreed to make restitution in

Kelly waived the right to challenge any

2

sentence at or below 21 months' imprisonment, or to attack his
conviction on the ground of a Brady violation.
On July 28, Kelly entered a plea of guilty.

He indicated

under oath that he was satisfied with his attorney and had had a
sufficient opportunity to discuss with the attorney the charges,
any defenses to those charges, and the consequences of a plea.
Kelly was advised of his rights and acknowledged the principal
terms of the Agreement, including the waiver of the right to
challenge any sentence of 21 months' imprisonment or less.
The Court described the charge in Count Two by explaining
inter alia that it charged Kelly
With the crime of devising and carrying out a
scheme to fraudulently obtain money for yourself
through false representations, specifically by
diverting payments that were owed to an entity called
CEF, Community for Education Foundation. . . . [Y]ou
diverted most of those proceeds for the payments for
your own personal benefit. Do you understand that’s
the charge against you?
Kelly responded that he did understand that that was the charge
against him.
Kelly allocuted shortly thereafter that
I was employed as the executive director of the
Community for Education Foundation. During the course
of my employment I took money from Community for
Education Foundation for my personal use, without
proper authority or permission. In the course of
taking this money I used a fax to accomplish that.
During colloquy with the Court, Kelly acknowledged that he
had given instructions to a school district that it could send
3

money to CEF by wiring money to the Fund.

He did not inform the

district that he was going to divert the money and that the
money would be going to his "personal use."

Kelly said that “By

wiring it [the money] into the account that it was wired into I
represented to the outside party that it was going to CEF and
not to my personal use.”

When the Court asked, “[s]o, the

instructions you gave in effect communicated to that party who
owed CEF money or wanted to send money to CEF that it in fact
would be going to CEF when you planned to divert it,” Kelly
responded, “That’s correct.”
Prior to sentence, defense counsel made written objections
to the Pre-Sentence Report ("PSR").

He disputed the PSR's

statement that no one at CEF, particularly its founder, was
aware of a purported relationship between the Fund and CEF.
Court scheduled a Fatico hearing for December 1.

The

On December 1,

after extensive colloquy, Kelly withdrew all factual objections
to the PSR and represented that there was no need for a Fatico
hearing.
At the sentencing proceeding on December 4, Kelly
represented that he had no permission to do what he did and that
he had "violated the trust of people."

Kelly was sentenced to

21 months' imprisonment, to be followed by a term of three
years' supervised release, and required to pay $100 as a special
assessment and $94,767 in restitution.
4

Kelly appealed his conviction, arguing that the Court had
failed to advise him that it could order him to pay restitution
in an amount greater than described in the Agreement.
appeal was summarily denied.

The

The Court of Appeals wrote that

Kelly had "sufficient awareness of the relevant circumstance[s]
and likely consequences" of his plea, including sentencing and
restitution.

398 Fed.Appx. 665, 666 (2d Cir. 2010).

DISCUSSION
In support of his petition, Kelly has presented a five-page
affidavit and two memoranda of law which make essentially five
points.

These arguments largely stem from Kelly's assertion

that he did have authority as the Executive Director of CEF to
affiliate the Fund with CEF and therefore it was not a
"misrepresentation" for Kelly to advise a school district that
owed money to CEF to send that money to the Fund's bank account.
Kelly's five points are:
1) when Kelly represented at his plea that "by wiring it
[the money] into the account that it as wired into I represented
to the outside party [the school district] that it was going to
CEF and not to my personal use," Kelly did not intend to admit
that he had made any misrepresentation and that his admission of
a misrepresentation during the plea allocution was a
constructive amendment of the Indictment since the crime to
5

which he pleaded guilty did not require proof that he had made
any misrepresentation;1
2)

Kelly wanted to withdraw his plea because the PSR

contained a description of conduct beyond that encompassed by
his plea, and his attorney did not make such a motion;
3) Kelly's attorney should have sought a continuance and
done further work in order to show that Kelly had authority in
his role as Executive Director of CEF to open the Fund's bank
account and treat it as a CEF account;
4) the Government failed to provide Kelly with CEF
financial records and bank account information that would
establish that the Fund's bank account was in fact a CEF account
or at least that CEF was ultimately "credited" with the money
deposited in the Fund's bank account and Kelly's attorney failed
to raise this issue with the Court; and
5)

Kelly's attorney failed to include in his appeal the

argument that there was an insufficient factual predicate for
the plea.
In opposing the petition, the Government has provided an
extensive and helpful analysis of the deficiencies in Kelly's

1

Kelly appears to argue both that (1) the Grand Jury believed
that the bank account for the Fund was not a CEF account and
that Kelly had false represented that the Fund's bank account
was an account of CEF, and (2) that the Indictment did not
encompass the misrepresentation to which Kelly admitted during
his allocution.
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petition.

Its submission includes an affidavit from Kelly's

retained counsel, who represented Kelly at his plea and on
appeal.

It is apparent, however, without the need to consult

defense counsel’s affidavit or conduct any hearing, that Kelly's
petition fails on multiple grounds, including the following.
First, in his Agreement with the Government Kelly waived
his right to argue that his Brady rights had been violated.
Kelly does not suggest that the Agreement was not entered
knowingly and voluntarily.

Indeed, Kelly was questioned about

those very issues at his plea and acknowledged that before he
signed the Agreement he had both read it and discussed it with
his attorney.

See, e.g., United States v. Riggi, 649 F.3d 143,

150 & n.1 (2d Cir. 2011).
It should be noted, in any event, that the Government
represents that it provided all pertinent records in its
possession to the defendant.

In addition, the existence of such

bank records was known to Kelly and he never complained prior to
the entry of his plea that he needed more time to obtain them or
that the Government had failed to provide documents to him.
Finally, Kelly does not explain how any documents would
exculpate him.

He does not deny that he instructed the school

district to wire the funds to the Fund, that he controlled the
Fund’s bank account, and that he used the money intended for CEF
to pay personal expenses.

Kelly confirmed these facts during
7

his plea allocution and a court is permitted rely upon the
defendant’s sworn statements in open court.

See United States

v. Hernandez, 242 F.3d 110, 112-13 (2d Cir. 2001).
Next, Kelly’s complaints about the plea allocution also
fail.

Kelly was required to present any arguments addressed to

the adequacy of the plea allocution on his direct appeal.
Massaro v. United States, 538 U.S. 500, 504 (2003).

Nor can he

show that his attorney was ineffective for failing to do so.
The allocution was thorough and Kelly expressed satisfaction
with counsel, his understanding of his rights, and his violation
of the law as charged in Count Two.

Indeed, at his sentence, he

reiterated that he had no permission to do what he did and had
violated the trust that had been placed in him.

Appellate

counsel cannot be faulted for failing to present frivolous
arguments on appeal.

See Forbes v. United States, 574 F.3d 101,

106 (2d Cir. 2009).
Kelly appears to complain that the PSR described illegal
conduct in which he engaged beyond that encompassed by his plea.
A conviction may not be vacated because the PSR describes
conduct beyond that necessary to support the count of
conviction.

Indeed, it is customary for a PSR to describe

relevant conduct, and for that conduct to be evaluated in
connection with the determination of an Offense Level for the
Sentencing Guidelines calculation.
8

Moreover, Kelly was given

ample opportunity to point out any errors in the PSR, and was
given an opportunity to participate in a Fatico hearing if he
wished to press any disagreement with the PSR's description of
his conduct.

After extensive colloquy with the Court, Kelly

explicitly abandoned those disagreements and waived his right to
that hearing on the day of the Fatico hearing.

Finally, in his

petition Kelly does not identify any specific fact in the PSR
with which he presently takes issue.
Nor has Kelly shown that his attorney was ineffective in
failing to argue that Kelly had authority to treat the Fund's
bank account as CEF's account.

During a lengthy colloquy with

the Court on the day scheduled for the Fatico hearing, Kelly's
counsel admitted that the founder of CEF "did not know that [the
Fund] was affiliated or is in some way connected to CEF."

If

that representation was in error, Kelly had an opportunity at
that moment to correct his attorney and so advise the Court.
But, more to the point, the crime to which Kelly pleaded guilty
did not hinge on CEF’s knowledge of or control over the Fund’s
bank account.

The critical issue was whether Kelly acted with

fraudulent intent when he used funds destined for CEF for his
personal use.

Kelly admitted that misconduct both at his plea

and at his sentence.

There is, therefore, no basis on which to

fault his attorney for any perceived failure to analyze the law
regarding authorization more closely.
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CONCLUSION
Kelly's petition for a writ of habeas corpus is denied.

In

addition, the Court declines to issue a certificate of
appealability.

Kelly has not made a substantial showing of a

denial of a federal right, and appellate review is therefore not
warranted.

Love v. McCray, 413 F.3d 192, 195 (2d Cir. 2005).

The Court also finds pursuant to 28 U.S.C.

§

1915(a) (3) that any

appeal from this Order would not be taken in good faith.

Coppedge v. United States, 369 U.S. 438, 445 (1962).

The Clerk

of Court shall dismiss this petition and close the case.

SO ORDERED:
Dated:

New York, New York
July 25, 2012

United S

10

District Judge

COPIES MAILED TO:
Thomas M. Kelly

Reg. # 61413-054

201 Queensberry Court

Pittsburgh, PA 15237