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United States v. Ledee

United States Court of Appeals, First Circuit

November 5, 2014

EDGARDO COLÓN LEDÉE, Defendant, Appellant

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[Copyrighted Material Omitted]

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Víctor M. Agrait-Defilló for appellant Astrid Colón Ledée.

Rafael F. Castro-Lang, with whom Nicolás Nogueras Cartagena was on brief, for appellant Edgardo Colón Ledée.

Charles Robert Walsh, Jr., Assistant United States Attorney, with whom Rosa Emilia Rodríguez-Vélez, United States Attorney, Nelson Pérez-Sosa, Assistant United States Attorney, Chief, Appellate Division, and John A. Mathews II, Assistant United States Attorney, were on brief, for appellee.

Before Lynch, Chief Judge, Torruella and Lipez, Circuit Judges.


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LIPEZ, Circuit Judge.

Appellants in this consolidated appeal are a brother and sister who were found guilty of multiple bankruptcy-related crimes designed to conceal the brother's assets and thereby avoid his obligations to creditors. The pair assert a host of trial and sentencing errors, none of which we find meritorious. Accordingly, we affirm both siblings' convictions and sentences.

I. Factual Background

We present the facts as the jury could have found them, reserving additional detail for our analyses of appellants' claims.

In August 2002, Edgardo Colón Ledée, a plastic surgeon, and his sister, Astrid Colón Ledée, a bankruptcy attorney, collaborated on the transfer of Edgardo's oceanfront residence and office to Investments Unlimited (" IU" ), a corporation wholly owned and controlled by Edgardo. Astrid drafted the deed and represented IU in the transaction as its president. The property, known as Málaga #1, had an outstanding mortgage of about $720,000, and the deed states that Edgardo sold it to IU to extinguish a $40,000 debt. Edgardo reported in his later filings in bankruptcy court that he leased the property from the corporation after the transfer, but the mortgage remained in his name and he continued to take the mortgage interest deduction on his personal tax return.

In May 2003, approximately nine months after the transfer of Málaga #1, Edgardo filed a voluntary petition for Chapter 7 bankruptcy, with Astrid serving as his attorney. At that time, he reported a debt of $100,000 to the Puerto Rico Treasury Department and faced about twenty malpractice suits. In the Statement of Financial Affairs (" SOFA" ) filed with his bankruptcy petition, Edgardo did not disclose his ownership of IU and Málaga #1 or that he had transferred the property to IU less than a year earlier.[1] In October 2003, Edgardo filed an amended petition whose supporting documents disclosed some additional properties, but he again failed to report the Málaga #1 transaction or his ownership of IU. The newly disclosed properties were heavily encumbered, and therefore did not add to the funds available for creditors. Astrid also signed the amended petition as Edgardo's legal representative in the bankruptcy. In both the original and amended petitions, Edgardo reported that he rented Málaga #1 from IU.

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In November 2003, Edgardo lied under oath at a meeting of his creditors convened by the bankruptcy trustee, testifying that IU's stockholders lived in Chicago and were not related to him. He also reported that his only relationship with IU was an agreement to rent Málaga #1. Astrid, who attended the meeting as Edgardo's attorney, subsequently gave the trustee copies of commercial and residential leases that purported to show that Edgardo was renting Málaga #1 from IU. Based on Edgardo's filings and his representations at the creditors' meeting, the trustee found that there were no assets that could be liquidated to obtain funds to pay creditors and, on December 28, 2004, the trustee filed a Report of No Distribution.

In July and August 2006, during the pendency of the bankruptcy case and without notice to the trustee or bankruptcy court, Edgardo arranged for IU to purchase three pieces of property: a penthouse condominium known as Laguna Gardens V PHP (for $195,000), a building known as El Convento (for $490,000), and an adjacent lot next to El Convento identified as Antonsanti (for $68,000). Edgardo deposited cash into IU's bank account to fund the purchases, and Astrid paid the amounts due at the closings with manager's checks drawn on IU's account.[2] Astrid represented IU as its president for each of the three transactions, executing the deeds at each closing.

The deception began to unravel in late 2006 when a creditor's objection to the Report of No Distribution led the bankruptcy trustee to look more closely at the Málaga #1 property. A realtor hired by the trustee discovered a " for sale" sign on the property and, upon inquiring, learned that the seller was Edgardo. The trustee's ensuing investigation revealed Edgardo's prior sale of the property to IU and Astrid's role in the transaction, prompting the filing of an adversary complaint in the bankruptcy case on December 14. The trustee alleged in the complaint that Edgardo had transferred the property to IU " with an actual intent to hinder, delay or defraud" creditors, and he demanded that the transfer be set aside and the property declared part of Edgardo's bankruptcy estate. The trustee also sought sanctions against Astrid, including damages and attorney's fees in favor of the bankruptcy estate, and filed a notice in the real property registry alerting third parties to the title claim against Málaga #1. Later in the month, Astrid, as IU's president, signed annual reports for the company for the years 2001 to 2005.[3]

Developments on two fronts quickly followed the filing of the adversary proceeding. On January 5, 2007, Astrid withdrew from the bankruptcy case and informed the bankruptcy court that she had resigned her position as IU's president. Meanwhile, Edgardo arranged a hurried sale of Málaga #1 to his girlfriend's parents, with the closing taking place on January 6, Three Kings Day, a significant holiday in Puerto Rico and an unusual day for such a transaction. Representing IU at the closing was Myrna Cintrón Estrada (" Cintrón" ), Edgardo's cousin who served as his housekeeper and who had been newly installed as IU's president to replace

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Astrid. The sales price was $1.1 million, with $410,000 due from the buyers, Luis Santiago Aponte (" Santiago" ) and Yolanda Lebrón Matos (" Lebrón" ), the latter figure being roughly the amount in excess of the outstanding mortgage on the property.

On January 8 and 12, manager's checks totaling $410,000 and made out to Investments Unlimited were deposited into IU's bank account, one in the amount of $205,000 on the earlier date and two for $102,500 on the later date. The larger check and one of the two smaller ones was obtained in Santiago's name, and the third check was obtained in Lebrón's name. On each of the two days the deposits were made, or shortly thereafter, Edgardo wrote four checks on IU's account for $51,250 each -- a total of eight checks[4] -- to the following individuals: Cintrón, Rafael Vaquer, Maria Bonilla Hernández, and Reynaldo Cordero Cintrón.[5] Each of the eight IU checks was used to purchase a manager's check in the same amount made out to the same individuals. Although the manager's checks contained endorsement signatures on the back, all four payees -- all family members of Edgardo -- denied receiving or endorsing the checks. All of the checks apparently were returned to the accounts of Santiago and Lebrón.

The adversary proceeding in Edgardo's bankruptcy case was resolved in March 2008. Edgardo and Astrid both accepted a Partial Settlement Agreement finding that Málaga #1 was property of the bankruptcy estate and requiring Edgardo to rescind the sale to Santiago and Lebrón. Edgardo further agreed that, if the proceeds from the trustee's sale of Málaga #1 did not suffice to pay all claims and costs,[6] the trustee could reactivate the adversary proceeding and seek the shortfall from sale of the properties Edgardo purchased in 2006 -- the Laguna Gardens V PHP, El Convento, and Antonsanti.[7] Edgardo subsequently filed amended schedules with the bankruptcy court that reported, inter alia, his 100 percent ownership of IU.[8]

A year later, in April 2009, Edgardo and Astrid were charged in an eight-count indictment with various bankruptcy-related crimes, including conspiracy to conceal property belonging to Edgardo's bankruptcy estate and to fraudulently conceal and transfer his and IU's property with the intent to defeat the bankruptcy laws, as well as a substantive offense alleging that they concealed the property. See 18 U.S.C. § § 371,

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152(1) & (7). The first five counts cited the siblings' concealment of Edgardo's ownership interests in IU and Málaga #1 and the transfer of funds through IU to purchase the three properties in 2006. Count Six charged Edgardo alone with the fraudulent transfer of Málaga #1 in January 2007, in violation of 18 U.S.C. § 152(7). Count Seven charged him with laundering the proceeds of the Málaga #1 " sale" in January 2007 by converting the two $205,000 payments into eight cashier's checks payable to four individuals who " had no financial interest in the transaction or Investments Unlimited," in violation of 18 U.S.C. § 1956. Count Eight was based on conduct unrelated to the activities at issue in this appeal.[9]

After a seventeen-day trial in January and February 2012, a jury found Edgardo guilty on Counts One through Seven and Astrid guilty on all five counts against her. Edgardo was acquitted of the fraudulent transfer alleged in Count Eight. The district court sentenced Edgardo to sixty months' imprisonment on each of Counts One through Six and seventy-two months' imprisonment on Count Seven, the money-laundering crime, all to be served concurrently. The court sentenced Astrid to a term of thirty-six months. The district court granted Astrid's request for release on bail pending appeal so that she could care for her ailing mother, conditioned on her mother's continuing need for help. Edgardo began serving his term in May 2013.

On appeal, appellants challenge both their convictions and sentences, each asserting multiple claims of error. They insist that the evidence was insufficient to support their convictions on some or all counts, and their common claims also include an objection to the district court's sixteen-level increase in their base offense levels under the sentencing guidelines. Edgardo includes among his claims a contention that the Partial Settlement Agreement, which brought Málaga #1 into his bankruptcy estate, constituted a waiver by the government of all charges based on conduct that was cured by his corrective actions. Astrid includes among her claims a contention that the district court abused its discretion by denying her motion in limine to exclude prejudicial evidence relating to her own bankruptcy proceedings in 2000.

We address these arguments in turn, identifying in each instance whether the challenge is brought by Edgardo, Astrid, or both siblings.

II. Edgardo: Government Waiver

Edgardo asserts that the Partial Settlement Agreement in his bankruptcy case effected a waiver by the government of the fraud, concealment, and money laundering charges lodged against him and, hence, entitled him to a judgment of acquittal on all counts. He frames this argument in terms of estoppel: the government is estopped from charging him criminally for concealing his ownership of Málaga #1 and IU and failing to disclose the transactions associated with them, because the trustee and bankruptcy court accepted the amended bankruptcy schedules that remedied any illegality in his prior conduct. In advancing this argument, Edgardo invokes both equitable estoppel and judicial estoppel.

A. Equitable Estoppel

In general, courts apply equitable estoppel " to prevent injustice when an

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individual detrimentally and predictably relies on the misrepresentation of another." Nagle v. Acton-Boxborough Reg'l Sch. Dist.,576 F.3d 1, 3 (1st Cir. 2009). The doctrine is used sparingly against the government, id., and a party seeking to equitably estopp the government must show " at least . . . 'an affirmative misrepresentation or affirmative concealment of a material fact by the government,'" Shafmaster v. United States, 707 F.3d 130, 136 (1st Cir. 2013) (quoting Ramírez-Carlo v. United States, 496 F.3d 41, 49 (1st Cir. 2007)). See also Heckler v. Cmty. Health Servs. of Crawford Cnty., Inc., 467 U.S. 51, 60, 104 S.Ct. 2218, 81 L.Ed.2d 42 (1984) (noting that " it is well settled that the Government may not be estopped on the same terms as any other litigant" ). Here, Edgardo cites no affirmative statement by the ...

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