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United States v. McQuarrie

United States District Court, E.D. Michigan, Northern Division

May 7, 2018

UNITED STATES OF AMERICA, Plaintiff,
v.
D-1, SCOTT DAVID MCQUARRIE, Defendant.

          ORDER DENYING DEFENDANT'S MOTION TO DISMISS AND DENYING MOTION TO TRANSFER

          THOMAS L. LUDINGTON UNITED STATES DISTRICT JUDGE

         Scott McQuarrie was indicted on June 13, 2016, with six counts alleging that he made false statements and converted collateral pledged for a loan he received from the Farm Service Agency (FSA). ECF No. 1. On June 8, 2017, a superseding indictment was returned which charged Scott McQuarrie with twelve counts and which named his parents, David Allen McQuarrie and Yvonne Evelyn McQuarrie, as co-Defendants in two counts. On November 1, 2017, a second superseding indictment was issued which charged the three Defendants with an additional two counts, for a total of fourteen counts. ECF No. 42. On January 10, 2018, and February 14, 2018, third and fourth superseding indictments were issued. ECF No. 76, 103. A trial on the fourth superseding indictment was held in late March of 2018.

         I.

         Two days before jury selection occurred, Scott McQuarrie filed a motion to dismiss Count Four of the fourth superseding indictment. ECF No. 130. Count Four of the fourth superseding indictment charges Scott McQuarrie with the conversion or concealment of a TW 35 tractor which had been pledged by Scott McQuarrie as collateral to the Secretary of Agriculture, in violation of 18 U.S.C. § 658. The original indictment also includes a Count Four. There are two differences between the original Count Four and the Count Four in the fourth superseding indictment. First, the collateral was identified as a “jib plow” in the original indictment and identified as a “TW 35 tractor” in the fourth superseding indictment. Second, the crime is alleged to have occurred sometime after March 3, 2012, in the original indictment, but sometime after July 20, 2011, in the fourth superseding indictment.

         Scott McQuarrie argues that Count Four of the fourth superseding indictment should be dismissed because it falls outside the five year statute of limitations for the offense of conversion. Mot Dismiss at 1, ECF No. 130 (citing § 18 U.S.C. § 3282). He contends that, because the fourth superseding indictment was filed on February 14, 2018, and Count Four took place sometime after July 20, 2011, Count Four falls outside the five year statute of limitations.

         On May 19, 2018, the day before trial began, the Court issued an order providing notice that Count Four might be severed. ECF No. 133. In that Order, the Court indicated that the change to Count Four constituted a substantive change which broadened the charges being advanced against Scott McQuarrie. Thus, the fourth count of the fourth superseding indictment did not relate back to the original indictment for statute of limitations purposes. Nevertheless, because the Government had not responded to the motion to dismiss, the Court declined to resolve the motion to dismiss on its merits.

         During trial, Count Four was severed. On March 25, 2018 (midway through trial), the Government responded to the motion to dismiss. ECF No. 141. In that response, the Government argues that Count Four is not barred by the statute of limitations because it is a continuing offense which continues to this day. The jury found Scott McQuarrie guilty of twelve of the fourteen charged counts. ECF No. 147. The only unresolved charge is Count Four. Trial on that count is currently set to begin on May 22, 2018.

         On April 6, 2018, the Court issued an order directing supplemental briefing on Scott McQuarrie's motion to dismiss Count Four. ECF No. 164. In that order, the Court explained that “Count Four of the fourth superseding indictment does not relate back to the date the original indictment was filed.” April 6, 2018, Order at 3. For clarity, additional portions of the April 6, 2018, order will be reproduced here.

Generally speaking, the “‘statute of limitations . . . begin to run when the crime is complete.'” Toussie v. United States, 397 U.S. 112, 115 (1970) (quoting Pendergast v. United States, 317 U.S. 412, 418(1943)). The statute of limitations should not be extended “[e]xcept as otherwise expressly provided by law.” 18 U.S.C. § 3282. Continuing offenses constitute an exception to that general rule. The Supreme Court has, however, cautioned that “the doctrine of continuing offenses should be applied in only limited circumstances.” Toussie, 397 U.S. at 115. Specifically, an offense should not “be construed as a continuing one . . . unless the explicit language of the substantive criminal statute compels such a conclusion, or the nature of the crime involved is such that Congress must assuredly have intended that it be treated as a continuing one.” Id.
Count Four charges Scott McQuarrie with violation of 18 U.S.C. § 658. That statute does not mention the statute of limitations, much less designate the offense as a continuing one. See United States v. Banks, 708 F.Supp.2d 622, 624 (E.D. Ky. 2010) (concluding that the statute did not designate the offense as continuing because it did “not use the term ‘continuing offense' or even mention the statute of limitations'”). Accordingly, the determinative question is whether the nature of the crime defined in § 658 “is such that Congress must assuredly have intended it to be . . . a continuing one.”

Id. at 3-4.

         The Court explained that “‘[c]ourts do not traditionally consider theft a continuing offense, '” but noted that some “‘[s]tatus crimes can be continuing offenses. Id. at 4-5 (quoting Bank, 708 F.Supp.2d at 625; United States v. Collier, 68 Fed.Appx. 676, 680 (6th Cir. 2003)). The touchstone of continuing offenses is that they “involve ‘continuing threat[s] to society.'” Id. at 4 (quoting United States v. Bailey, 444 U.S. 394, 413 (1980)). Sometimes that means that the “injury to the victim is inflicted anew each day” and sometimes that means that “the continued concealment results in [additional] unlawful financial benefits to the perpetrator.” Id. at 6.

         Ultimately, the Court directed the parties (and, in particular, the Government) to provide supplemental briefing:

The Government's brief should address the nature of the “concealment” it believes Scott McQuarrie engaged in. In particular, the Government should identify what distinguishes Count Four from Count Five. The Government should likewise address the harms to the FSA and benefits to Scott McQuarrie which it believes the concealment created. In articulating the harms and benefits, the Government should take care to explain how they were exacerbated by the period of concealment. Finally, the ...

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