Lipson, Sylvia A. v. United States

In the

United States Court of Appeals

For the Seventh Circuit

No. 98-4051

Sylvia A. Lipson,

Petitioner-Appellant,

v.

United States of America,

Respondent-Appellee.

Appeal from the United States District Court

for the Southern District of Illinois.

No. 97-CV-891-WDS--William D. Stiehl, Judge.

Argued April 26, 2000--Decided November 7, 2000

Before Bauer, Rovner, and Diane P. Wood, Circuit

Judges.

Diane P. Wood, Circuit Judge. Sylvia Lipson,

along with a number of other people, was charged

and convicted of conspiring to distribute crack

cocaine in violation of 21 U.S.C. sec. 846 and of

using her home to store and distribute crack

cocaine in violation of 21 U.S.C. sec. 856. She

received stiff sentences for those convictions,

of 360 months and 240 months respectively, which

run concurrently. After both her convictions and

sentences were affirmed on direct appeal, see

United States v. Smith, 26 F.3d 739 (7th Cir.

1994), she filed the present motion under 28

U.S.C. sec. 2255. (The case was remanded on other

grounds, see 26 F.3d at 760, and later affirmed

on a subsequent appeal. United States v. Smith,

No. 96-2724, 1997 WL 58804 (7th Cir. Feb. 7,

1997).)

Her argument for relief has shifted during the

course of these proceedings, but it is very

generally an ineffective assistance of counsel

claim based on conflict of interest. We conclude

that, under the circumstances, further

proceedings are necessary in the district court

before it will be possible for that court to

decide whether Lipson’s Sixth Amendment rights

were violated because her lawyer was paid by one

of her co-defendants.

I

The underlying basis for Lipson’s claim of

ineffective assistance rests on her allegation

that her representation was tainted by a conflict

of interest because of the relationship between

her lawyer and her co-defendant, Greg Collins.

Collins was the ringleader of the conspiracy.

Lipson (whose version of the facts on these

points we accept, given the lack of an

evidentiary hearing) was an indigent single

parent. She was romantically involved with, and

habitually battered by, Collins. Eventually,

Lipson, Collins, and eight other individuals were

charged in the multi-count indictment that

produced the convictions Lipson is now trying to

challenge.

A careful reading of the original pro se sec.

2255 motion that Lipson filed reveals that she

raised two complaints about her representation at

trial that related to conflicts of interest.

Specifically, her motion made the following

assertions:

This request [i.e. for an order appointing

counsel and setting an evidentiary hearing on the

sec. 2255 motion] to the court is based on the

ineffective assistance of counsel, namely, Ricky

Black. Black should not have been allowed to

represent Collins and Lipson, due to the conflict

of interest and others violations of

Constitutional and Due Process Rights. Lipson

simply did not have the ’baggage" that Collins

and the other conspriators [sic] were found

guilty or convicted.

Black was paid his attorneys fees by Collins who

was interested in controlling the defense in his

favor in this case.

Other portions of the same memorandum make it

clear that she was asserting that Collins had

selected Black to be her lawyer and that he was

paying Black, so that he could control Lipson’s

representation. Her motion also raised numerous

other grounds for relief, including recanted

testimony of a witness, the government’s failure

to prove that the substance was really crack, a

claim that her sentence should be reduced because

she had been abused, and so on.

We focus here on the ineffective assistance

claim, because this is the only one on which a

certificate of appealability has been granted.

This court granted that certificate after the

trial court denied Lipson’s request, and it

identified the following issue for appeal:

"Whether trial counsel was ineffective due to a

conflict in representing both petitioner and her

co-defendant, Greg Collins." We also appointed

appellate counsel for Lipson.

Unfortunately, the precise theory of ineffective

assistance identified in our certificate of

appealability does not appear to have been the

theory--or at least the only theory--before the

district court, as Lipson’s original motion

demonstrates. Furthermore, it is clear from a

reading of the district court’s opinion that the

judge understood what Lipson was trying to say.

After rejecting a number of specific instances of

ineffective counsel that Lipson had alleged, that

related to failures to investigate her claim or

to communicate with her, the court wrote the

following:

Petitioner further alleges that counsel had a

conflict of interest. Specifically, petitioner

argues that counsel neglected her interests to

benefit a co-defendant, Gregory Collins, her boy

friend and co-defendant who paid for attorney’s

fees.

Lipson v. United States, No. 97-CV-891-WDS, Mem.

& Order at 6 (S.D. Ill. August 26, 1998). After

reciting the standard established by Strickland

v. Washington, 466 U.S. 668 (1984), and noting

that Lipson was relying on Strickland rather than

Cuyler v. Sullivan, 446 U.S. 335 (1980) (which

would have permitted her to demonstrate an actual

conflict of interest which, if shown, would have

lightened the burden of demonstrating ineffective

assistance), the court rejected her argument with

the following explanation:

. . . To demonstrate prejudice [under

Strickland], petitioner must demonstrate that

counsel’s errors were so serious as to deprive

her of a fair trial, that is, of a trial whose

result is reliable. . . . At trial, the

government provided extensive evidence

demonstrating petitioner’s deep involvement to

amply support her conviction. . . . Her counsel

certainly participated in the trial on her

behalf, not on behalf of any co-defendant. This

case involved a joint defense of a lack of

conspiracy. That commonality does not rise to the

level of conflict.

Similarly, the mere fact that a co-defendant

footed the bill for her defense counsel does not,

in and of itself, create a conflict of interest.

This is not a situation like that presented in

Stoia [v. United States, 109 F.3d 392 (7th Cir.

1997)] or similar conflict cases. The Court finds

that petitioner’s claims of conflict are wholly

unsupported by the record.

Lipson, Mem. & Order at 7.

It is therefore clear that, until the

certificate of appealability issued from this

court, everyone knew that this case was about the

type of conflict that can arise when one

co-defendant retains, pays, and controls the

lawyer representing another co-defendant.

Unfortunately, matters became confused in part

because of our order and in part because counsel

for Lipson must not have investigated the record

very carefully. Lipson’s opening brief in this

court relies solely on the proposition that the

issue was joint representation of her and

Collins. The government correctly responded in

its brief that the record clearly showed that no

such thing occurred. Lipson was represented by

attorney Richard R. Black, of East St. Louis,

Illinois, while Collins was represented by

attorney Robert H. Rice of Belleville, Illinois

at the pre-trial, trial, and appellate stages,

and attorney Burton H. Shostak of St. Louis,

Missouri, after remand and on the new appeal.

Lipson’s reply brief concedes the error, in

effect, and argues that her right to effective

counsel was nonetheless infringed by the

financial arrangements between Collins and Black.

There is plenty of blame to spread around for

this confused state of affairs, but none of it in

our view properly goes to Lipson. In fact, the

government fully briefed the question whether

Black labored under a conflict of interest

because of the fact that Collins paid for his

services to Lipson, and Lipson’s appointed

counsel also briefed that issue (albeit in the

reply brief). In these somewhat unusual

circumstances, we think it best to expand the

certificate of appealability to include the

actual conflict theory Lipson originally alleged,

the district court decided, and the parties

addressed. We hereby do so, and now turn to the

merits of this claim.

II

As we recently explained in Cabello v. United

States, 188 F.3d 871 (7th Cir. 1999), defendants

who wish to raise claims of ineffective

assistance of counsel based on conflicts of

interest may proceed under either of two

theories. If the defendant can establish that the

trial judge knew or should have known that a

potential conflict of interest existed, then we

presume that the defendant was prejudiced by that

conflict if the judge made no inquiry into it.

Id. at 875. If, on the other hand, the trial

judge was not put on notice of a potential

conflict, we will find prejudice "only if the

defendant demonstrates that her counsel actively

represented conflicting interests and that the

conflict adversely affected the counsel’s

performance." Id., citing Cuyler, 446 U.S. 335,

350 (1980).

Both parties claim that Cabello entitles them

to prevail, and so we take a moment to review the

facts and holding of that case. In Cabello, the

petitioner (Maria Cabello) argued that her trial

counsel provided ineffective assistance because

he had been retained and paid by her boyfriend,

the alleged ringleader of the drug conspiracy in

which she was accused of participating. Like

Lipson, Cabello also argued that her indigence

should have put the district court on notice of

the likelihood that the boyfriend was paying for

the lawyer, when the lawyer showed up ready to

participate in the proceedings without any

request for granting Cabello IFP status.

Importantly, the court considering Cabello’s sec.

2255 motion held an evidentiary hearing on her

allegations at which it heard testimony from both

Cabello and the retained lawyer. On this record,

we concluded in Cabello that there was nothing

that should have alerted the trial court to the

potential for a conflict, and that nothing in the

record indicated that Cabello had been actually

prejudiced by her lawyer’s performance.

We see no distinction between Cabello’s case

and Lipson’s with respect to the first of these

points. As far as the trial court knew, Lipson

and Collins were represented by different

lawyers, and the judge specifically found in his

sec. 2255 memorandum and order that Lipson’s

lawyer gave her adequate representation. Lipson

suggests that the court should have seen red

flags in the facts that she and Collins were

being tried together, that they had a romantic

relationship, and that Collins had abused her in

the past--all of which were known at the time of

trial. But we see no reason why the existence of

the romantic relationship should have triggered

the thought that Collins was paying for Lipson’s

lawyer, much less why a history of abuse should

have supported such an inference. We must turn,

therefore, to the second question identified in

Cabello--whether Lipson can show an actual

conflict of interest and an adverse effect on her

representation, and, in her case, whether the

district court abused its discretion in failing

to hold a hearing to explore these points./1

Lipson alleged in her motion that Black allowed

Collins to dictate her legal defense because

Collins was paying his fees. If true--and because

there was no hearing we must assume that it is--

this would be enough to demonstrate an actual

conflict of interest. Stoia v. United States, 22

F.3d 766, 771 (7th Cir. 1994) ("An actual

conflict of interest results if the defense

attorney was required to make a choice advancing

his own interests to the detriment of his

client’s interests." (Quotations and citation

omitted.)). See also Ciak v. United States, 59

F.3d 296, 307 (2d Cir. 1995).

But demonstrating the actual conflict is not

enough by itself. Lipson must also show that

Black’s conflict adversely affected his

performance. She must suggest something that he

did that he should not have done, or something

that he failed to do that should have been done,

that had a negative impact on her case. To the

extent she implies that Black should have raised

the point that she was effectively under

Collins’s control and thus not responsible for

her actions in furtherance of the conspiracy, our

examination of the record shows that he did bring

out this evidence. At trial, Black argued that

Lipson was an unwilling participant in the

conspiracy--the precise theory of innocence that

she is now asserting in her sec. 2255 motion. She

was entitled to put this argument before the

jury, and in fact, the jury evidently took it

quite seriously. At one point during its

deliberations, the jury sent a note to the trial

judge explaining that they felt that Lipson had

participated in the conspiracy "only because of

love, fear, and concern for her children," and

"in much the same way one would be [willing] with

a knife to their throat." The jury asked in its

note whether this concern was sufficient reason

to find a reasonable doubt, but the judge

responded without objection from Black that it

was to follow the instructions that had already

been given. See Smith, 26 F.3d at 748.

The record reveals that those instructions did

not include a possible duress defense. Instead,

counsel tendered an instruction defining the term

"willful" for the jury, which would have told

them that willfully means voluntarily and

intentionally acting with bad purpose either to

disobey or disregard the law. The judge rejected

that instruction, but that was not counsel’s

fault. Furthermore, we note that duress is an

extremely difficult defense on which to succeed.

Counsel’s decision to try to use Collins’s

overbearing influence on Lipson as a way of

negating Lipson’s criminal intent was a

respectable strategy, and one that might have

succeeded. See United States v. Madoch, 149 F.3d

596, 598-600 (7th Cir. 1998). See also United

States v. Fiore, 178 F.3d 917, 922 (7th Cir.

1999); United States v. Otis, 127 F.3d 829, 835

(9th Cir. 1997).

Her lawyers on appeal now suggest that another

adverse effect of Black’s relationship with

Collins was Black’s failure to pursue a plea

agreement on Lipson’s behalf. If true, and if the

evidence showed that she had told him at the time

she might be interested in cooperating, that

might qualify as an adverse effect resulting from

the conflict of interest. Compare Paters v.

United States, 159 F.3d 1043, 1047-48 (7th Cir.

1998); Johnson v. Duckworth, 793 F.2d 898, 902

(7th Cir. 1986). Had there been such a plea

agreement, Lipson might have agreed to testify

against Collins in exchange for a reduced

sentence; Collins certainly had every incentive

to prevent such an outcome, and to instruct Black

not to pursue that strategy. We think it

significant that this is exactly what happened

with about half of the defendants, who testified

against those who remained and who received

lighter sentences. The presence of these other

turncoats meant that joint denial was a weak

strategy at best for Collins and Lipson. The

possibility that Lipson was trying to game the

system--first cooperating with her co-defendant

Collins in the denial strategy, and then claiming

that she might have pleaded guilty and helped the

government--seems unlikely enough on the present

facts that it should not defeat her right to a

hearing as a matter of law. The fact that the

government accepted guilty pleas from some

defendants indicates that it might have been open

to negotiating with Lipson as well.

Lipson herself alluded to the lost chance at a

guilty plea in her sec. 2255 motion, where she

wrote "because of Black’s loyalty to Collins was

inspired to prevent Lipson from receiving any

representation at all from Black, because Black

and Collins knew or should have known if Lipson,

plead guilty, she would have to testify against,

Collins, as Black’s paymaster, rather than Lipson

who was also his client." This statement appears

to be her only effort to bring this point to the

district court’s attention. Nevertheless, she was

at that time proceeding pro se, and her statement

appeared in the sec. 2255 motion itself; it was

not buried in the middle of a large stack of

discovery materials or otherwise difficult to

find.

III

We cannot tell without an evidentiary hearing

whether Black really did fail to pursue a plea

agreement on Lipson’s behalf, whether Lipson had

any interest in pleading guilty at the time, or

whether the government would have offered an

agreement to her in any event. The judgment of

the district court is therefore Reversed and the

case is Remanded for further proceedings consistent

with this opinion.

/1 Our dissenting colleague is concerned about what

a trial judge might do to prevent the kind of

complaint that Lipson is now raising. But that

point assumes that we are criticizing the trial

judge for failing to do something at the original

trial, which is not the case. As we explain in

the text, this is not a case in which the trial

judge either knew or should have known about the

potential conflict of interest. Because it is

not, the defendant must satisfy the strict

requirements of Cuyler, 446 U.S. at 335, 350.

This kind of claim, just like many other

ineffective assistance of counsel claims that a

trial judge would similarly be unable to

anticipate, sometimes requires an exploration of

the facts at the sec. 2255 stage. We hold here

only that Lipson has alleged enough to entitle

her to such an exploration.

BAUER, Circuit Judge, dissenting. I respectfully

dissent. The return of this case for purposes of

deciding whether the defendant would have been

amenable to a "plea agreement" (and, I take it,

whether the prosecution would have even

entertained such an agreement), or what

bargaining chips the defendant had to expend,

adds a totally new dimension to what a trial

judge should do to avoid just this sort of up-

and-down program before or after trial. Should

the district court inquire of each defense

counsel as to whether he or she attempted a "plea

bargain"? Does the court have to inquire as to

whether the government would enter into such

negotiations? And what precisely would trigger

such an inquiry; jointly indicted defendants? Or

is every defendant to be questioned?

The majority agrees that nothing in the record

would have alerted the trial court to inquire or

question the independence of the defendant’s

representation. The defendant insisted that she

was a victim of the co-defendant’s coercion and

went to trial on that issue.

The drowning man clutches at hairs; I don’t

blame this defendant for her late defense,

attacking her attorney. I do object to requiring

an inquiry into a matter that would seem to

assume the defendant’s guilt (or why "bargain"?)

or assume a lawyer’s malpractice. This record

shows that the defendant was well represented and

fairly convicted. That should end the inquiry. I

would affirm.