A recent case that provides great practical lessons both for counsel and bankruptcy criminal defendants denied a defendant's motion to dismiss an indictment under circumstances where an alleged plea agreement on misdemeanor charges could not be proven and was never accepted by the court.
In United States v. Welch, No. 4:19-CR-00278-DCN (April 7, 2020), the defendant filed a bankruptcy petition and later was accused of concealing hundreds of thousands of dollars in assets during the case. According to Welch, he received a target letter from the U.S. Attorney's Office. His attorney began investigating the case and negotiated with the government a misdemeanor plea agreement. In the ensuing time period, a discovery package arrived but no plea agreement. Nine months later, Welch was indicted on two counts of bankruptcy fraud and two counts of concealing assets in his bankruptcy case. He moved to dismiss the indictment on the ground that the government reneged on the alleged plea agreement or in the alternative to enforce the agreement and reduce the charges to a misdemeanor offense. The government opposed the motion arguing (1) there was no plea agreement and (2) if there was an agreement it wasn't binding because it was never accepted by the court and the defendant did not detrimentally rely on it.
The court credited the government's position and denied the motion. The court held there was insufficient evidence that a plea agreement was negotiated, agreed upon and drafted. Welch provided no supporting documentation, declarations, or affidavits. He could have provided an affidavit himself, or sought one from the negotiating attorney or prosecutor but didn't. And he could have provided attached email negotiations as exhibits, but didn't. On the record, the court had only alleged communications from two attorneys formerly involved in the case which amounted to inadmissible hearsay. Without adequate admissible evidence of the plea agreement, dismissal of the indictment was not warranted.
Interested readers are referred to the full opinion here for the court's treatment of the detrimental reliance issue, which the court need not have reached since it found no evidence for an agreement in the first place.
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