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Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 1 of 26 Page ID #:105 GREGORY NICOLAYSEN
State Bar No. 98544
27240 Turnberry Lane, Suite 200
Valencia, CA 91355
Phone: (818) 998-2706
Fax: (818) 998-8427
Cell: (818) 970-7247
Email: [email protected]
Counsel For Defendant,
Leopoldo Gutierrez
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
WESTERN DIVISION
UNITED STATES OF AMERICA,
CR 10 - 136 - GAF
Plaintiff,
SENTENCING POSITION PAPER
FILED BY DEFENDANT
LEOPOLDO GUTIERREZ
LEOPOLDO GUTIERREZ,
Date: December 5, 2011
Defendant
Time: 1:30 p.m.
Court: The Hon. Gary A. Feess
_________________________________)
Defendant Leopoldo Gutierrez hereby submits his sentencing position paper,
including any objections to the Presentence Report (“PSR”).
DATED: November 15, 2011
Respectfully Submitted,
By:__________/S/_______________
GREGORY NICOLAYSEN
Counsel for Defendant,
Leopoldo Gutierrez
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 2 of 26 Page ID #:106 MEMORANDUM OF POINTS AND AUTHORITIES RE: SENTENCING
INTRODUCTION
Opening Statement
Defendant Leopoldo Gutierrez, a 22-year old first - time offender who had just
turned 20 years old when he was arrested (and immediately released) in March 2009 in
connection with offense conduct to which he pleaded guilty, now comes before the
Court for sentencing. Mr. Gutierrez has pleaded guilty straight-up (without a written
plea agreement) to Counts 3 and 4 of the Indictment, which both charge violations
occurring in March 2009: one pertaining to the online sale of counterfeit Viagra; the
other to the sale of ecstasy pills to an undercover agent.
The defense appreciates and thanks the Probation Office for recommending a
sentence substantially below the advisory guideline range. In this position paper, Mr.
Gutierrez respectfully asks the Court to adopt the overall position of the Probation
Office in granting a sentence below the guidelines, but to go beyond the PSR by
granting a sentence that will allow Mr. Gutierrez to continue both his college education
and his current employment.
Specifically, Mr. Gutierrez asks the Court to impose a sentence of one day in
custody (satisfied by the time period in the U.S. Marshals’ custody on the day of his
initial appearance), and the maximum allowable Supervised Release term of three
years [PSR at par. 85, page 14], with the following conditions:
six months’ residency in a halfway house;
twelve months (one year) of home detention with electronic
monitoring;
30 hours of community service per year over a three- year period,
for a total of 90 hours.
This sentencing request amounts to a total of eighteen months (6 + 12) which is
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 3 of 26 Page ID #:107 half of the advisory guideline range of 37 - 46 months. As discussed below, the
Probation Office has recommended a sentence of 24 months, which is half of the 46 - 57
month advisory guideline range calculated in the PSR. The 37 - 46 month range
reduces the PSR range by two levels to take into account Safety Valve.
Thus, the defense is asking the Court to apply the same approach as the
Probation Office: take half of the advisory guideline range and impose that as the
sentence; but do so using the non-custodial alternatives of home detention and halfway
Procedural History Relevant To Sentencing
The following section summarizes the procedural history that is relevant to
sentencing.
On March 26, 2009, ICE agents who had conducted an undercover investigation
of Mr. Gutierrez regarding the online sale of counterfeit Viagra executed a search
warrant of his vehicle and residence at the time Mr. Gutierrez was scheduled to
conduct a pre-arranged, one-time sale of ecstasy pills to the agents pursuant to a sting
operation set up by the agents.
The agents did not arrest Mr. Gutierrez on this occasion. Instead, the proceeded
to enlist the cooperation of Mr. Gutierrez, which he gladly provided. This cooperation
arrangement began on the same day – March 26, 2009 – with an in-depth interview of
Mr. Gutierrez and proceeded to entail ongoing interviews and pro-active work by Mr.
Gutierrez. This cooperation work is discussed in more detail in a subsequent section of
this position paper, with numerous citations to attached exhibits.
Among the key aspects of Gutierrez’s cooperation was his disclosure of his
network arrangement with a Chinese distributor of counterfeit Viagra known to him
as “Bob”. As discussed in detail in this memorandum, Gutierrez disclosed in depth to
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 4 of 26 Page ID #:108 the agents the totality of his distribution arrangement with “Bob”; the email address
for “Bob”; and Gutierrez maintained ongoing Instant Message communications with
“Bob” at the direction of the agents. “Bob” would later be indicted in this district in
two separate indictments on the very same day as Gutierrez (February 11, 2010), with
docket numbers that were only one digit apart from Gutierrez case: CR 10-135 and CR
10-137. This case against Gutierrez is CR 10-136. None of this would be known to
Gutierrez or his counsel until January 2011, as discussed below.
In approximately July 2009, Mr. Gutierrez’s current counsel undertook pre-
indictment settlement discussions with prior government counsel, AUSA Mark Krause,
to resolve this case. Mr. Gutierrez had not been arrested or charged by this point in
time; but as noted above, he had been cooperating with the agents.
On August 12, 2009, Mr. Gutierrez, together with his current counsel and
investigator, conducted a cooperation proffer session at the U.S. Attorney’s Office with
AUSA Mark Krause and the agents, for the purpose of exploring a formal cooperation
arrangement. The meeting lasted approximately 90 minutes. The agent’s report
generated from the meeting is attached hereto as Exhibit 20. Mr. Gutierrez
respectfully disagrees with the agent’s characterization and summary of certain
statements made by the Mr. Gutierrez during the meeting; however, the essential
thrust of the report correctly conveys that Mr. Gutierrez explained in detail his
background selling online Viagra, his sources, and his desire to assist the government
in identifying and prosecuting those sources.
Unbeknownst to Mr. Gutierrez or his counsel, on February 11, 2010, the
government filed the present Indictment against Mr. Gutierrez under seal. The case
number assigned: CR 10 - 136. [Pacer # 1 - 7]. The single-defendant Indictment
against Mr. Gutierrez charges four substantive counts: Counts 1, 2 and 3 charging the
sale of counterfeit Viagra, in violation of 18 U.S.C. 2320; and Count 4 charging the sale
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 5 of 26 Page ID #:109 of ecstasy pills on March 26, 2009, in violation of 21 U.S.C. 841(b)(1)(C).1
On February 11, 2010, simultaneous with the filing of the Gutierrez indictment,
the government filed two indictments against an individual named Bo Jiang, the true
name of Gutierrez’s Viagra supplier whom Gutierrez knew as “Bob.” The filing of
these indictments, particularly in conjunction with the filing of the indictment against
Gutierrez, confirmed that the agents had been actively investigating “Bob” during the
time period in which Gutierrez had been cooperating with the agents in regard to
“Bob”, by disclosing full details of the Viagra distribution arrangement between
Gutierrez and “Bob”; disclosing the email address used by “Bob”; and conducting
online IM communications with “Bob.”
The close connection between Gutierrez’s cooperation and the investigation of
Bo Jiang, aka “Bob”, is clearly reflected in the docket numbers. As stated in the
Introduction to this position paper, Bo Jiang was indicted in cases CR 10-135 and CR
10-137. The Indictment in this case against Gutierrez is CR 10-136. The charges
against Bo Jiang involved the same allegations as those against Gutierrez: violations of
18 USC 2320 for the sale of counterfeit Viagra, among other charges. The indictments
in both of Bo Jiang’s cases are attached hereto as Exhibits 26 and 27 hereto.
Importantly, the Indictment against Bo Jiang in CR 10-135 alleges that Jiang used a
specific email address, which was in fact the email address that Gutierrez had disclosed
to the agents for “Bob.”
Due to the under seal nature of the February 2010 filings, none of the above
events were known to Gutierrez or his counsel. In fact, after the cooperation proffer
session was conducted in August 2009, and all the way until the first week of January
2011 – a period of almost a year and a half – neither Mr. Gutierrez nor his counsel had
any contact with the government on this case. There was no activity on this case at all.
There is no mandatory minimum penalty for the sale of ecstasy. Moreover, 21 U.S.C.
841(b)(1)(C) is a subsection of section 841 that does not carry a mandatory minimum.
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 6 of 26 Page ID #:110 Clearly, the government did not regard Gutierrez as a danger to the community or
someone who needed to be prosecuted anytime soon. This is an important
consideration for mitigation at sentencing.
In the first week of January 2011, counsel for Mr. Gutierrez received a call from
AUSA Mark Krause informing counsel that an Indictment had been filed and that the
government was prepared to coordinate a self-surrender and stipulated bond.
On January 11, 2011, Mr. Gutierrez made his initial appearance before the duty
magistrate pursuant to the self-surrender arrangement coordinated between his
current counsel and the government. Counsel escorted Mr. Gutierrez to Pretrial
Services and then to the U.S. Marshals, where he was taken into custody pending the
initial appearance before the duty magistrate. The Indictment was unsealed and the
parties stipulated to a low bail of $10,000 Appearance Bond signed by Mr. Gutierrez’s
father, who was present in court [Pacer #10, 14].2 Mr. Gutierrez was released the same
Again, from a sentencing mitigation perspective, the informal manner in which
government counsel coordinated a self-surrender and stipulated unsecured bond
clearly showed that Gutierrez was not viewed as someone who posed a threat to the
community; a risk of re-offending; or needed to be put into custody.
On August 25, 2011, Mr. Gutierrez entered guilty pleas to Counts 3 and 4 of the
Indictment straight up, without a written plea agreement. Count 3 charges the sale of
counterfeit Viagra on March 5, 2009; Count 4 charges the sale of ecstasy on March 26,
2009, in violation of 21 U.S.C. 841(b)(1)(C). Defense counsel recited the factual basis
for each count into the record, which was accepted by the government. Sentencing was
set for the current date of December 5, 2011. [Pacer #28].
See Exhibit 1 hereto, which is a copy of the Court Bond downloaded from Pacer.
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 7 of 26 Page ID #:111 Brief Summary Of Sentencing Mitigation Factors Based On Procedural History
The procedural history summarized above presents key sentencing mitigation
facts that weigh strongly in favor of a non-custodial sentence:
The agents did not arrest Gutierrez on March 26, 2009 but, instead,
immediately recruited him as a cooperator;
Gutierrez provided ongoing cooperation for many weeks thereafter,
which is discussed in detail later in this memorandum;
The government conducted a lengthy cooperation proffer session with
Gutierrez and his counsel in August 2009;
After the cooperation proffer session, this matter remained dormant for
almost a year and a half until Gutierrez’s counsel was contacted to
coordinate a self-surrender in January 2011;
The government filed an Indictment against Gutierrez under seal in
February 2010 and allowed it to remain under seal for an entire year until
January 2011, which shows that the government did not feel any urgency
to prosecute Gutierrez.
At the time the Indictment was filed against Gutierrez in February 2010,
companion indictments were filed against “Bob” in cases separated from
this case on the docket by single digits, thus showing the close connection
between Gutierrez’s cooperation and the investigation against “Bob”;
In January 2011, when the government elected to go forward with this
prosecution of Gutierrez, government counsel and counsel for Gutierrez
worked out an informal self-surrender and unsecured bond signed by
Gutierrez’s father.
Moreover, Mr. Gutierrez has fully complied with all conditions of bond since his
initial appearance and setting of bond on January 11, 2011. [Presentence Report,
“PSR”, at par. 6, page 4].
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 8 of 26 Page ID #:112 OBJECTIONS OR CORRECTIONS
TO THE PRESENTENCE REPORT
Part A of PSR: The Offense
No Objection To Guideline Calculation
While the PSR summarizes the offense conduct applicable to all three Viagra
counts in the Indictment (Counts 1, 2 and 3), whereas Mr. Gutierrez only pleaded to
Count 3, there is no objection this factual summary. Mr. Gutierrez takes full
responsibility for the fact that had maintained an ongoing business of selling
counterfeit Viagra online in years 2008 and 2009, as reflected in Counts 1, 2 and 3 of
the Indictment. Thus, Mr. Gutierrez accepts the broader summary of the offense
conduct which goes beyond the factual basis that was orally recited into the record at
the change of plea hearing as to Count 3.
With regard to calculating the offense level for the sale of counterfeit Viagra,
Mr. Gutierrez accepts the PSR’s calculation of an Offense Level 9 even though it
presupposes certain facts that exceed the factual basis that was orally stated on the
record at the change of plea; and there is no foundation of evidence, specifically the
usage of the number 256 as the total number of Viagra pills sold, which represents the
sum of the pills alleged in Counts 1, 2 and 3 [PSR at par. 21, page 6]; and the usage of
the $17 market value per pill which the PSR states is based on a representation made
by Pfizer, the manufacturer [PSR at par. 23, page 6.
Nonetheless, Mr. Gutierrez waives objections on foundational grounds, and no
objection is being made, as Mr. Gutierrez readily accepts his responsibility for his
involvement in running an Internet-based business selling counterfeit Viagra. The
defense accepts a summary of offense conduct in the PSR that exceeds the factual basis
presented at the change of plea.
As reflected in the PSR’s recommendation of a below-guidelines sentence, the
online Viagra business was the true offense conduct committed by Mr. Gutierrez;
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 9 of 26 Page ID #:113 whereas, the ecstasy sale in March 2009, which sets the benchmark for the advisory
guideline range at Level 26, was a one-time event that had no connection to the Viagra
business and occurred only because of a sting operation conducted by the agents.
Request For Safety Valve Credit
Counsel for the government and defense have discussed this matter and have
stipulated that Mr. Gutierrez should receive the 2-level reduction for Safety Valve.
The defense thanks and appreciates the government’s concurrence on this issue
without the need to litigate the matter.
The PSR reaches an Adjusted Offense Level 23 (Base 26 - 3 for Acceptance).
[PSR at par. 38, at page 7]
Accordingly, the Offense Level should be reduced by two levels to Level 21 to
take into account the Safety Valve.
The parties and PSR concur that Mr. Gutierrez is a Criminal History I. [PSR at
par. 43, at page 8]
Accordingly, the advisory guideline range is:
Level 21 / CH I = 37 - 46 months.
Request That Court Adopt The Same Formula As PSR: Grant A
Downward Variance That Cuts The Low End Of The Advisory Range In
Based on the higher advisory range of 46 - 57 months per Offense Level 23 [PSR
at par. 81, at page 12, not taking Safety Valve into account], the Probation Office
recommends a substantial downward variance below the advisory range and
recommends a sentence of twenty-four (24) months (Recommendation Letter at page
1]. In essence, the Probation Office recommends that the Court cut the low end of the
advisory guideline range in half: 24 months is essentially half of the low end of 46
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 10 of 26 Page ID #:114 Mr. Gutierrez respectfully asks the Court to apply the same approach: grant a
downward variance that cuts the low end of the 37 - 46 range in half, by imposing a
sentence of 18 months that is comprised of non-custodial alternatives: halfway house
and home detention.
The Probation Office’s Recommended Variance Below The Guidelines
Does Not Reflect Gutierrez’s Cooperation
It is important to note that the substantial downward variance recommended by
the Probation Office is being recommended even without any consideration given to
Mr. Gutierrez’s cooperation, as it is the policy of the Probation Office not to factor
cooperation into the sentencing analysis contained in a PSR.
Despite Mr. Gutierrez’s cooperation with the agents from March 26, 2009
through December 2009, the government has declined to file a 5K1.1 downward
departure motion to reduce the advisory guideline range. This is unfortunate and has
been the subject of ongoing discussions between counsel for both parties. The defense
nonetheless appreciates that the government, in its filing, will be bringing Mr.
Gutierrez’s cooperation to the Court’s attention, even without a formal 5K1 motion.
His cooperation work is also discussed below.
Accordingly, Mr. Gutierrez respectfully asks this Court to factor his cooperation
into the section 3553(a) analysis, discussed below, in granting a downward variance
that exceeds the variance recommended by the Probation Office, by granting the non-
custodial alternatives of halfway house and home detention.
Part C of PSR:
Offender Characteristics
There are no objections to Part C of the PSR, entitled Offender Characteristics,
covered in pages 8 - 11.
Mr. Gutierrez would add to the Employment section (see pars. 66 - 60, pages 10 -
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 11 of 26 Page ID #:115 11) that he is currently employed by a produce company (Reiter Brothers, Inc. 730 So.
A Street, Oxnard, CA 93030), as a fruit picker in the orchards located in Moorpark,
working essentially the same labor as a migrant farm worker. He earns $8.00 per
hour, working 50 hours per week. Attached hereto as Exhibits 21 - 25 are photos of
Mr. Gutierrez working, and the orchards where he works. The photos were taken on
November 14, 2011 by counsel’s CJA-appointed investigator, Steven Strong (LAPD
retired).
It is important to emphasize to this Court that Mr. Gutierrez is a hard-working
individual who, in a tough job market for young men who do not have college degrees,
is prepared to work the farm fields to earn a living. This is excellent evidence of post-
offense rehabilitation.
A SENTENCE OF EIGHTEEN (18) MONTHS
OF ALTERNATIVES TO CUSTODY
(HALFWAY HOUSE, HOME DETENTION-ELECTRONIC MONITORING,
AND COMMUNITY SERVICE) IS SUFFICIENT,
BUT NOT GREATER THAN NECESSARY,
TO COMPLY WITH THE STATUTORY PURPOSES
OF SENTENCING UNDER 18 U.S.C. 3553(a)
3553(a)(1): Nature And Circumstances Of The Offense
As reflected in the PSR, the advisory guideline range is driven by the offense
level for ecstasy (Offense Level 26), which is substantially higher than the offense level
for selling counterfeit Viagra (Offense Level 9).3 As such, the advisory guideline range
It is important to note that the disparity under the guidelines between the Level 9 for
Viagra and Level 26 for ecstasy is so great that no multiple count adjustment is added to the
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 12 of 26 Page ID #:116 over-states the seriousness of the offense because the true offense conduct is the online
sale of Viagra (Counts 1 - 3), which Mr. Gutierrez had been engaged in during years
2008 - 2009.
The undercover agent had been engaged in an investigation during which he
engaged Mr. Gutierrez in online negotiations / transactions of counterfeit Viagra
during the period June 2008 up to the date of Gutierrez's detention on March 26, 2009.
In contrast, the negotiation to sell ecstasy (Count 4) was a one-time event in
March 2009 that resulted from a sting operation set up by the same agent with whom
Gutierrez had been dealing on the Viagra sales.4 This one-time even involving ecstasy,
which Mr. Gutierrez explained to the agents was provided to him by a relative of his
girlfriend (see Exhibit 5 hereto) constitutes aberrant conduct for which Mr. Gutierrez
is deeply remorseful, as reflected by his cooperation, discussed below.
In this context, this case should be viewed as a prosecution for conducting an
online business selling counterfeit Viagra, for which the PSR calculates an Offense
Level 9 prior to a reduction for Acceptance [PSR, pars. 22-27, page 6]. If this case had
been prosecuted solely as a Viagra case, the Adjusted Offense Level after Acceptance
would be 7, placing Gutierrez in Zone A of the guideline table and thus eligible for
probation prior to considering 3553(a) factors.
The over-representation of the advisory guideline range should also be seen
from the perspective that the Level 26 for ecstasy, which drives the guideline analysis,
operates as if there are no counts of conviction for Viagra. Thus, what we end up with
offense level under Chapter 3 of the guidelines, even though the ecstasy and Viagra counts of
conviction do not group under the guidelines. See PSR at par. 34, at page 7.
The sale of ecstasy was not actually completed. The agents confronted Mr. Gutierrez in his
driveway as he was leaving his residence to meet the agents to conduct the sale. The ecstasy
tablets were seized from his vehicle. Accordingly, the conviction on Count 4 is for possession with
the intent to distrubute, as no actual distribution occurred.
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 13 of 26 Page ID #:117 here is a situation where the real offense – the online sales of Viagra – are not reflected
at all in the guideline analysis; while the aberrant event resulting from a sting
operation – the single sale of ecstasy – is treated as the definitive offense for guideline
sentencing purposes.
Therefore, consistent with the position taken by the Probation Office, a
downward variance below the advisory guideline range should be granted.
3553(a)(1): History And Characteristics Of The Defendant
Mr. Gutierrez’s Genuine Remorse For His Wrongful Conduct
During the presentence interview, Mr. Gutierrez expressed clear remorse for his
illegal behavior, which was captured by the Probation Officer in his Recommendation
Letter to the Court:
"Gutierrez appears absolutely sincere in his understanding
of his illegal conduct and his vow to lead a lawful life."
[Rec. Letter at page 4 of 5].
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 14 of 26 Page ID #:118 Mr. Gutierrez’s Ongoing Cooperation Immediately Following His
Detention On March 26, 2009
March 26, 2009: Gutierrez Begins To Cooperate And
Undergoes An Extensive Interview
On March 26, 2009, the undercover agent and his team confronted Mr.
Gutierrez in his driveway as he was about to leave his residence to meet the agent to
make a sale of ecstasy pills. The pills were seized from his vehicle. Mr. Gutierrez was
not arrested. Instead, he agreed to cooperate and immediately underwent an interview
with the agents which continued into the following day, March 27, 2009.
Attached hereto as Exhibit 2 is an investigative report (Bates 000247, 250 - 256)
which summarize in great detail the lengthy and extensive interview that the agents
conducted with Gutierrez on March 26, 2009. The report expressly states that when
the agents confronted Gutierrez on that date,
SA DeFreitas advised Gutierrez that he was not under arrest
and was free to leave if he chooses.
[Exh. 2, Bates 000250].
March 27, 2009: Gutierrez Travels To The Long Beach
Office of ICE For Another In-Depth Interview
Mr. Gutierrez’s cooperation carried over to the following day, March 27, when
he was re-interviewed. Attached hereto as Exhibit 3 hereto (Bates 000257 - 260), an
investigative report that states in pertinent part:
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 15 of 26 Page ID #:119 During the search, Gutierrez willingly agreed to be
interviewed by agents. At the conclusion of the interview
with Gutierrez, agent Jason DeFreitas requested that
Guitierrez be re-interviewed the following day, March 26, in
which Gutierrez agreed.
On or about March 27, 2009, . . . Gutierrez was interviewed
by SAs DeFreitas along with Timothy Kirkham at the
SAC/LA office located at 5012 W. Ocean Blvd, Long Beach,
[Exh 3 at Bate 000258. The report states that the following day is March 26. In fact, it
is March 27. The report contains a typo.].
During the two-day, March 26-27 interviews, Gutierrez described in detail his
online Viagra business and identified a key supplier from China whom Gutierrez knew
as “Bob.” Gutierrez identified “Bob” from a photo of a Chinese individual shown to
him by the agents. [Exh 3 at Bate 000259-60]. Gutierrez also identified the individual
known to him as “Tommy” who was the source for the single sale of ecstasy to the
agents. Exh 3 at Bate 000259-60].
Bob’s email address: a key item of information that Gutierrez provided to the
agents pursuant to his cooperation was the email address that Gutierrez used to
communicate with “Bob.” That email address was: shiboliangfoods®gmail.com. This
email address is set forth in the IM exchanges between Gutierrez and “Bob” that are
attached hereto as Exhibits 16 - 19. When it eventually filed an under seal Indictment
against “Bob” (true name: Bo Jiang) on February 11, 2010, the very same day that the
government filed its under seal indictment against Gutierrez, the government would
expressly cite “Bob’s” email address, shiboliangfoods®gmail.com, in the body of the
Indictment. (See Exhibit 26 hereto).
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 16 of 26 Page ID #:120 April 4, 2009: Gutierrez Travels Again To The Long Beach
Office of ICE And Cooperates In An Undercover Capacity
The agents were clearly interested in Mr. Gutierrez’s cooperation. The
following week, on April 4, 2009, Gutierrez was interviewed yet again; and once again,
as he had done on March 27, Gutierrez traveled to the ICE office in Long Beach.
Importantly, the agents were so interested in working with Gutierrez that this
time, the agents used him in the pro-active capacity of conducting undercover recorded
conversations with targets of their ongoing investigations in the area of counterfeit
Viagra and related drugs.
Attached hereto as Exhibit 4 is an investigative report (Bates 000261 - 265) that
states in pertinent part:
On or about April 4, 2009, [ICE agents] Jason DeFreitas and
Aaron Lindaman conducted an interview of Gutierrez. The
purpose of this interview was to obtain information
regarding potential targets and to conduct several recorded
phone calls to in furtherance of potentially conducting
controlled purchases of suspected counterfeit
pharmaceuticals. This interview was conducted at the
SAC/LA office located at 5012 W. Ocean Blvd, Long Beach,
[Exh 4, Bate 000262].
As detailed in the Exhibit 4 report, while at the ICE office, Gutierrez worked at
the direction of, and under the supervision of, the agents as he sent text messages and
made monitored recorded phone calls to specific individuals who were in the business
of selling counterfeit Viagra. Note that in the report, from pages 000263-265,
Gutierrez is referenced by the nomenclature, “CD” [page 000263: “Gutierrez,
hereinafter referred to as the CD.”].
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 17 of 26 Page ID #:121 March 27, 2009: Gutierrez Travels To The Long Beach
Office of ICE For Another In-Depth Interview
The agents’ interest in Gutierrez’s cooperation continued. Attached hereto as
Exhibit 5 is an investigative report (Bates 000266 - 268) that summarizes a phone call
that Gutierrez initiated to the agents on April 23, 2009, and the follow-up interview
conducted the following day – April 24, 2009. On this occasion, Gutierrez reached out
to the ICE agent, Jason DeFreitas, to inform him of information he had acquired from
his girlfriend, namely that the source of the ecstasy that Gutierrez had negotiated to
sell to the agents was a cousin of his girlfriend named “Tommy.” The agents wanted to
interview both Gutierrez and his girlfriend. Accommodating the agents’ request,
Gutierrez and his girlfriend drove to the ICE office in Long Beach and underwent an
in-depth interview regarding “Tommy” so that the agents could initiate an
investigation of “Tommy,” which the agents subsequently did.
June 12, 2009: Gutierrez Travels To The Long Beach Office
of ICE For Another In-Depth Interview
Gutierrez continued to demonstrate an ongoing commitment to cooperate with
the agents, and they took him up on his offer. Attached hereto as Exhibit 6 is an
investigative report (Bates GUG418 - 420) that summarizes a phone call that Gutierrez
initiated to the agents on June 11, 2009, and the follow-up interview conducted the
following day – June 12, 2009. On this occasion, as he had done on April 23,
summarized above in Exhibit 5, Gutierrez initiated a call to the case agent to inform
him of key information that Gutierrez had learned through his girlfriend about
“Tommy,” the source of the one-time ecstasy sale. The agents were interested in this
information and asked Gutierrez to once again travel to the ICE office in Long Beach
the following day. Gutierrez again accommodated the agent’s request and went to the
ICE office on April 24 for an interview.
Exhibit 5 summarizes the interview with Gutierrez regarding information about
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 18 of 26 Page ID #:122 “Tommy” that Gutierrez had obtained in recent days from his girlfriend. The report
concludes with this important statement which clearly shows that the agents were very
interested in continuing to work with Gutierrez as a cooperator – and particularly, in
an undercover capacity:
At the conclusion of the interview, agents requested that
Gutierrez meet with Nguyen (his girlfriend), wearing an
audio recorder, and attempt to illicit incriminating
statements from Nguyen in regards to her statements made
to “Tommy” disclosing Gutierrez’s arrest and cooperating
with law enforcement.
[Exh 5 at page GUG420].
Gutierrez agreed to do so, as discussed in Exhibit 7 below.
June 23, 2009: Gutierrez Conducts An Undercover Audio
Recording Of A Conversation With His Girlfriend At The
Request Of The Agents
Following up on the June 12 meeting, Gutierrez coordinated with the agents to
wear a body wire to record his girlfriend. Attached hereto as Exhibit 7 is an
investigative report (Bates GUG421 - 423) that summarizes the undercover meeting
conducted on June 23, 2009 wherein Gutierrez met with his girlfriend wearing a body
wire at the request of the agents, for the purpose of seeking to elicit incriminating
statements from his girlfriend whereby she admitted that she had essentially
obstructed justice by forewarning “Tommy” that he might be prosecuted for selling
ecstasy due to the fact that Gutierrez had negotiated to sell ecstasy obtained from
Tommy to the agents and that Gutierrez was now cooperating.
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 19 of 26 Page ID #:123 June-July 2009: Agents Investigate "Tommy" By Obtaining
Cell Phone and DMV Records
Attached here to as Exhibit 8 is an investigative report (Bates GUG428 - 430)
that summarizes the work done by the agents to request and obtain both cell phone
and DMV records for “Tommy.” Clearly, the agents were interested in pursuing
“Tommy” as a target for prosecution based on the cooperation provided by Gutierrez.
April 2009: Gutierrez Communicates With Specific Targets
And Sets Up Dummy Web Sites For The Sale Of Viagra
Pursuant To His Ongoing Cooperation
The month of April 2009 was a very busy month for Gutierrez as a cooperator
for the agents. He made contact with individual targets named “Jeff”, “Bill” and
“Johnson”, who were known to Gutierrez as distributors of counterfeit Viagra.
Gutierrez made handwritten and typed notes of conversations and meetings with these
individuals, which are attached hereto as Exhibits 9, 10 and 11.
Additionally, at the direction of the agents, Gutierrez proceeded to set up
dummy web sites for the sale of Viagra on Craigs List, the same online listing place
where he had previously maintained online Viagra listings for his own business.
Examples of these dummy sites are attached here to as Exhibits 12 and 13. The Court
is asked to look at the lower right-hand corner of each page to see the date of the online
listing (e.g., Exh 12 is 04/26/2009).
To avoid having too many exhibits to this position paper, the dummy sites
created by Gutierrez for the agents on Craigs List are grouped together as Exhibits 14
and 15 hereto.
It cannot be emphasized enough that all of this work was done by Gutierrez at
the request of, and at the direction of, the ICE agents, and specifically, ICE agent
Jason DeFreitas, who has been the case agent in this prosecution.
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 20 of 26 Page ID #:124 April - December 2009: Gutierrez Conducts Online Instant
Message Conversations With Government Target “Bob” Re:
Viagra Sales
As illustrated herein, the cooperation provided by Gutierrez was wide-ranging.
The agents were eager to develop a prosecution against “Bob,” the Chinese individual
who had been the source of the counterfeit Viagra for Gutierrez. The agents openly
expressed their interest in getting “Bob” to Gutierrez.
To assist the agents, Gutierrez maintained his contact with “Bob”, specifically
by conducting online conversations known as Instant Messaging (“IM”). Attached
hereto as Exhibits 16 - 19 are copies of IM communications that Gutierrez kept in his
file and provided to his counsel. Exhibits 16, 17 and 18 are IM communications in
April and May 2009, during the same time period in which Gutierrez was traveling on
a repeated basis to the ICE office in Long Beach for the interviews discussed above. By
July 2009, Gutierrez was represented at the pre-indictment stage by his current
counsel. In August 2009, a cooperation meeting was conducted with the government,
and the cooperation work with the agents essentially was put on hold pending further
directions from the government, which never came.
Thus, what we see in Exhibit 19 is a brief IM initiated by Bob, with no response
from Gutierrez due to the lack of any guidance from the agents. But Bob was clearly
interested in continuing to do business with Gutierrez, and Gutierrez would have
gladly continued to cultivate that connection if the agents had provided him with
guidance and cooperation-related support.
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 21 of 26 Page ID #:125 August 2009: Gutierrez and His Counsel Conduct A
Cooperation Proffer Session With The Government
On August 12, 2009, Gutierrez, his current counsel and a defense investigator
met at the U.S. Attorney’s Office with AUSA Mark Krause and agents including agent
DeFreitas. During the meeting, Gutierrez provided detailed disclosures regarding the
contacts that he had already disclosed to the agents and against whom Gutierrez had
already provided pro-active cooperation, including “Bob”, “Bill” and “Tommy.” The
agent’s report of the meeting, together with the use immunity proffer letter, are
attached hereto as Exhibit 20.
February 2010: The Government Files Under Seal
Indictments Against Gutierrez And “Bob” With Docket
Numbers In Consecutive Digits: CR 10-135; CR 10-136; CR
The simultaneous filing of under seal indictments on February 11, 2010 against
Gutierrez (CR 10-136) and Bo Jiang, aka “Bob” (CR 10-135 and 10-137) – all
separated by single digits on the docket – clearly shows the close relationship between
the cooperation provided by Gutierrez and the government’s ongoing investigation of
“Bob”, the name by which Gutierrez knew him. (See Exhibits 26 and 27 hereto).
The PSR expressly acknowledges that the prosecution of Bo Jiang is related to
this prosecution of Gutierrez. See PSR at page 2, which states in pertinent part:
Related Cases: 10-135:
JIANG, Bo - pending
BRIDGMON, Abigale - pending
GONZALEZ, Francis Ortiz - pending
ALEMAN-VALENTIN, Ideliz -pending
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 22 of 26 Page ID #:126 The importance of the information and help provided by Gutierrez in regard to
“Bob” is illustrated in part by the fact that Gutierrez gave the agents the email address
for “Bob” back in March 2009 and conducted online IM communications with “Bob”
(see Exhibits 16 - 19), who used that same email address: [email protected].
The under seal Indictment against Bo Jiang in CR 10-135 expressly states in
paragraph 2, on page 1:
2. Defendant JIANG used the email addresses
shiboliangfoods®gmail.com and huashunltd®hotmail.com.
In refusing to grant Gutierrez a 5K1.1 motion for cooperation, it is possible that
if called as a witness at the sentencing hearing, agent DeFreitas may deny that he
learned the email address for Bo Jiang from Gutierrez. However, Gutierrez maintains
that upon providing this email address to the agent, the reaction from the agent
appeared clearly to indicate that the agent did not yet have this information and
appreciated receiving it from Gutierrez.
By obtaining the email for “Bob”, the agents could track Bob by way of his IP
(Internet Protocol) address and place “Bob” under surveillance by intercepting his
email transmissions.
February 2010: Government’s Filing In CR 10-135 To Keep
Indictments As To Bo Jiang Under Seal – One Reason Being
To Protect Confidential Informants
On February 11, 2010 -- the same day that the under seal indictments were filed
against Bo Jiang and Gutierrez – the government filed a Declaration of AUSA Mark
Krause in action CR 10-135 (Pacer #14). A copy of the Declaration is attached hereto
as Exhibit 28. The purpose of the Declaration is to persuade the District Court to keep
the indictments against Bo Jiang under seal. The Declaration states in part in
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 23 of 26 Page ID #:127 paragraph 3 as follows:
a. If the indictment remains unsealed, Jiang may be able to
obtain a copy of it. If Jiang were to obtain a copy of the
indictment, he would learn about the scope of the
investigation, may be able to discern the identity of the
confidential informants, and likely determine the identity of
the undercover agent. This would be problematic for several
reasons:
i. Should Jiang prematurely determine the identity of the
informants, their safety could be placed at risk. [Italics
It is a reasonable inference to draw that at the time this Declaration was filed in
February 2010, the government was considering Gutierrez as an informant against Bo
Jiang, even though Gutierrez had also been indicted. This inference is supported by
the fact that the government sat on the Gutierrez indictment for an entire year and did
not take any action thereon until January 2011. Thus, the Declaration quoted above
appears to support the view that Gutierrez was viewed by the government as a
cooperating source against “Bob” (Bo Jiang).
January 2011: Government Files Application For
Extradition Of Bo Jiang And Cites To Evidence Against Him
Based On Informants And Emails – Possible Reference To
Cooperation By Gutierrez
On January 25, 2011, in the prosecution of “Bob” under CR 10-135, the
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 24 of 26 Page ID #:128 government filed its extradition application (Pacer #19).5 In pertinent part, the
extradition application states at par. 16, page 9:
16. The facts of this case will be shown at trial by (1) the
testimony of informants and undercover officers; (2) emails,
including between Jiang and customers and Jiang and
undercover officers. . . [Italics Added]
While the government has never conceded this, defense counsel believes that if
called as a witness at the sentencing hearing, agent DeFreitas would acknowledge that
Gutierrez’s disclosure of the email address for “Bob” assisted the government in being
able to intercept email communications by and between “Bob” and his co-schemers,
thus providing the government with incriminating evidence against “Bob”, as
referenced in the excerpt from the extradition application above.
Taken together, the facts summarized above amply demonstrate that Gutierrez
has cooperated in a productive and genuine way so as to earn cooperation credit at
sentencing. While the U.S. Attorney’s Office has declined to file a 5K1 motion, the
defense acknowledges and thanks AUSA Carol Chen for her professionalism in her
inclusion of Gutierrez’s cooperation in the government’s sentencing position paper, so
that the Court has confirmation directly from government counsel that cooperation
was in fact provided.
However, the parties are at odds in regard to the nature and extent of the
cooperation rendered, and the value of such cooperation for purposes of granting
sentencing credit.
Due to its length, including numerous exhibits, the extradition application is too large a file
size to upload to the CM-ECF system. For this reason, it is not attached hereto as an exhibit.
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 25 of 26 Page ID #:129 Thus, the defense respectfully asks the Court to allow defense counsel to call
agent DeFreitas as a witness and further develop the facts pertaining to the subjects
discussed in the preceding sections of this memorandum, so that the nature, extent and
value of Gutierrez’s cooperation can be fully known to the Court, for the purpose of
granting Gutierrez appropriate sentencing credit as a reduction from the advisory
guideline range.
Post-Offense Rehabilitation: Mr. Gutierrez’s Farm Work
Attached hereto as Exhibits 21 - 25 are photos taken by defense counsel’s CJA
investigator on November 14, 2011 showing Gutierrez working in the farm fields in
Moorpack picking fruits and berries. This type of hard, physical labor represents a
huge turnaround in Gutierrez’s life, as he takes full responsibility for his obligation to
earn an honest living however he can manage to do so without a college degree in a bad
economy, and thus forever put behind him the unfortunate behavior of the past
whereby he made money on the Internet selling counterfeit Viagra.
These photos provide compelling evidence that Gutierrez poses little, if any, risk
of re-offending and in no way whatsoever does he pose a threat to the community.
CONCLUSION
For the reasons discussed herein, Mr. Gutierrez asks the Court to impose a
sentence of one day in custody (satisfied by the time period in the U.S. Marshals’
custody on the day of his initial appearance), and the maximum allowable Supervised
Release term of three years [PSR at par. 85, page 14], with the following conditions:
six months’ residency in a halfway house;
twelve months (one year) of home detention with electronic
monitoring;
Case 2:10-cr-00136-GAF Document 33 Filed 11/16/11 Page 26 of 26 Page ID #:130 30 hours of community service per year over a three- year period of
Supervised Release, for a total of 90 hours.
The combination of six months in the halfway house and twelve months of home
detention totals eighteen months, which is approximately half the low end of the
applicable guideline range of 37 - 46 months based on an Offense Level 21 / Criminal
History I. This approach of applying one half of the low end of the advisory range
comports with the downward variance recommended by the Probation Office, by
which Probation applied the higher advisory range of 46 - 57 (not taking into account
Safety Valve) and recommends a 24-month sentence, roughly half the low end. The
defense asks the Court to apply the same approach, using the Safety Valve-lowered
range of 36 - 47 and granting non-custodial alternatives to imprisonment.
DATED: November 15, 2011
Respectfully Submitted,
By:______________/S/___________
GREGORY NICOLAYSEN
Counsel for Defendant,
Leopoldo Gutierrez

Source: http://www.afda.org/web/CJA/11_CM-ECF_SentPos_LGutierrez.pdf