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United States v. Lovett

United States District Court, D. Nevada

July 10, 2018



         Presently before the court is petitioner Brent Lovett's motion to vacate, amend, or correct his sentence pursuant to 28 U.S.C. § 2255. (ECF No. 305). The government filed a response (ECF No. 307), to which petitioner replied (ECF No. 308).

         I. Background

         i. Factual summary

         Evidence presented at trial supports the following factual summary.

         Petitioner formed a number of business entities, among them Bay Resorts, Building the American Dream, Project Consultants, Coke Horse, and Coke Maggie. Petitioner's step-father, Paul Hummer, served as the president of these companies, and was responsible for signing certain paperwork, including loan documents and payroll checks. However, even though Hummer was nominally named as president, petitioner “was in charge of everything.”

         Petitioner also formed a company called Equity Resource, for which petitioner listed his sister, Lori Lovett, as president. Ms. Lovett believed that Equity Resource was “a holdings company of [petitioner's] real estate.” Again, although Ms. Lovett was nominally named as president, petitioner effectively controlled the company.

         In August of 2004, Bay Resorts leased a building at 2400 North Tenaya Way in Las Vegas, Nevada (“the Tenaya building”). Rent was $40, 000 per month. Bay Resorts stopped paying rent, and the owner began eviction proceedings. During litigation related to these proceedings, petitioner offered to purchase the building from the owner. On June 9, 2006, the owner agreed to sell the building to petitioner for $6 million. Ms. Lovett signed documents to assist her brother with a loan for the purchase of the Tenaya building.

         Petitioner coordinated the Tenaya building purchase as a “double escrow” transaction, whereby Bay Resorts would purchase the property and immediately re-convey it to Equity Resource for $10 million. Petitioner reached out to Lockheed Federal Credit Union (“Lockheed”) for a loan to finance the Equity Resource purchase.

         As a part of the loan request, petitioner made a number of false representations and omissions. Petitioner created false Equity Resource tax returns, representing assets of over $60 million. Petitioner created a counterfeit bank statement representing that Equity Resource had $3.3 million dollars in an account that actually contained $2. Petitioner represented that Equity Resource would fund $2.6 million of the $10 million purchase price. Petitioner failed to disclose the double-escrow nature of the transaction. Finally, petitioner failed to disclose the $1.3 million kickback that Bay Resorts would receive as a result of the $7.5 million loan to Equity Resource. A Lockheed representative stated at trial that Lockheed would not have approved the loan to Equity Resource if it had knowledge of these false representations and omissions.

         Lockheed approved Equity Resource's $7.5 million loan request based on the inaccurate and incomplete loan application. On August 9, 2006, Bay Resorts purchased the Tenaya building for $6 million and immediately re-conveyed it to Equity Resource for $10 million. This reconveyance ostensibly netted Bay Resorts close to $4 million in sale profits, [1] including approximately $1.3 million in remaining proceeds from the Equity Resource loan.

         After Equity Resource defaulted on the loan, Lockheed foreclosed on the Tenaya building. The foreclosure netted approximately $2 million, which resulted in a total loss amount of approximately $5 million. This was “the largest single loss in [Lockheed] history.”

         i. Procedural history

         On April 27, 2011, the government filed an indictment charging petitioner with one count of bank fraud. Trial began on February 13, 2013. On the first day of trial, petitioner moved to represent himself. The court[2] canvassed the parties regarding the propriety of the request, during which defendant's counsel stated that he had “done [his] best to get up to speed and believe[d] that [he was] up to speed” and was “ready for trial.” Petitioner thereafter stated that he was “not asking for any extensions or anything, I'm ready to proceed.” The court granted petitioner's request to represent himself.

         After seven days of trial, the jury convicted petitioner of bank fraud. The court sentenced petitioner to 98 months' imprisonment and ordered restitution in the amount of $4, 889, 134.

         Petitioner appealed his conviction to the Ninth Circuit. The court appointed counsel for petitioner, and denied petitioner's request to terminate appointed counsel. The court also did not accept petitioner's pro se brief. On August 8, 2016, the Ninth Circuit affirmed petitioner's conviction and sentence.[3]

         II. Legal Standard

         Federal prisoners “may move . . . to vacate, set aside or correct [their] sentence” if the court imposed the sentence “in violation of the Constitution or laws of the United States . . . .” 28 U.S.C. § 2255(a). Section 2255 relief should be granted only where “a fundamental defect” caused “a complete miscarriage of justice.” Davis v. United States, 417 U.S. 333, 345 (1974); see also Hill v. United States, 368 U.S. 424, 428 (1962).

         Limitations on § 2255 motions are based on the fact that the movant “already has had a fair opportunity to present his federal claims to a federal forum, ” whether or not he took advantage of the opportunity. United States v. Frady, 456 U.S. 152, 164 (1982). Section 2255 “is not designed to provide criminal defendants multiple opportunities to challenge their sentence.” United States v. Johnson, 988 F.2d 941, 945 (9th Cir. 1993).

         III. Discussion

         a. The successive claim rule

         “When a defendant has raised a claim and has been given a full and fair opportunity to litigate it on direct appeal, that claim may not be used as a basis for a subsequent § 2255 petition.” United States v. Hayes, 231 F.3d 1132, 1139 (9th Cir. 2000) (citing United States v. Redd, 759 F.2d 699, 700-01 (9th Cir. 1985)). Restating an issue by using different language does not make a previously considered claim reviewable. United States v. Currie, 589 F.2d 993, 995 (9th Cir. 1979).

         Petitioner argues that certain comments made by government attorneys at trial were unfairly prejudicial. (ECF No. 305). Specifically, petitioner argues that prosecutors made inappropriate comments about his self-representation, and that they erroneously argued during closing that the government had proven federal jurisdiction. Id. at 147.

         Petitioner raised both of these arguments in his direct appeal. The Ninth Circuit considered and rejected each argument. See Lovett, 668 Fed. App'x at 231. Therefore, petitioner is precluded from re-litigating these issues in a § 2255 motion. See Hayes, 231 F.3d at 1139.

         b. The ...

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