Jessica Osegura Evidence and Preclusions
Jessica Osegura Evidence and Preclusions
Jessica Osegura Evidence and Preclusions
Pursuant to the Scheduling Order entered by the Court on May 26, 2020 (Minute Order),
the government respectfully submits this omnibus set of pretrial motions. Specifically, the
government moves (1) to introduce as “other crimes” evidence the defendant’s association with a
Mexico-based business not named in the indictment but which was designated as a Specially
Designated Narcotics Trafficker by the Department of the Treasury’s Office of Foreign Assets
Control (“OFAC”); (2) to preclude argument and elicitation of testimony at trial suggesting that
the government is required to show that the defendant had actual contemporaneous notice of the
specific Foreign Narcotics Kingpin Designation Act (“Kingpin Act”) designations underlying the
indictment; and (3) to preclude argument and elicitation of testimony at trial aimed at
ARGUMENT
OFAC-designated entity. In particular, the government seeks to admit evidence stemming from
1
Pursuant to the Court’s Standing Order, Dkt. No. 16 (March 3, 2020), the government
anticipates that additional motions in limine will be filed closer to trial.
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 2 of 24
the defendant’s registration and management of a website for a company known as BRIC
Inmobiliaria, a real estate business based in Jalisco, Mexico, which was designated by OFAC in
August 2015, a month prior to the OFAC designation of five of the businesses in the indictment.
that is inextricably intertwined with the proof of the charged crimes, or in the alternative,
pursuant to Federal Rule of Evidence 404(b) in order to show her knowledge of the Kingpin
Act’s sanctions regime and the absence of mistake or accident in her continuing to transact or
deal with the six OFAC-designated entities that are the subject of the indictment.
Count One alleges that the defendant engaged in transactions or dealings with J&P
Advertising, S.A. de C.V. (“J&P Advertising”), a Mexico-based advertising company that was
designated by OFAC on September 17, 2015. The government expects to show at trial that the
defendant was listed on the incorporation paperwork of J&P Advertising as a 50% owner of the
company, as well as the sole administrator (“administrador unico”) of the business. 2 The
government expects to show at trial that the defendant continued to operate the business after its
Count Two of the indictment alleges that the defendant engaged in transactions or
dealings with JJGON, S.P.R. de R.L. de C.V. (“JJGON”), a Mexico-based company that
purported to transact in agricultural products, also designated by OFAC on September 17, 2015.
The government expects to show at trial that the defendant was listed on the incorporation
paperwork of JJGON as a 20% owner of the company, as well as its sole administrator. 3 The
2
In Mexican corporate law, an “administrador unico” is “essentially a board of directors of one
[person].” Robert E. Stevens et al., Doing Business in Mexico: A Practical Guide 62 (2012).
3
The company’s name, JJGON, is also a portmanteau of the defendant’s name, Jessica Johanna
Oseguera Gonzalez.
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 3 of 24
government expects to show at trial that the defendant continued to operate the business after its
Count Three of the indictment alleges that the defendant engaged in transactions or
dealings with Las Flores Cabanas, an unincorporated business entity that provided vacation
rental cabins in Mexico. Las Flores Cabanas was designated by OFAC on September 17, 2015.
The government expects to show at trial that the defendant was involved in running the business,
and in particular, that she applied for and owned the Mexican trademark for Las Flores Cabanas,
and still owns the trademark today. Ownership of a trademark is a property interest specifically
forbidden by the implementing regulations of the Kingpin Act. See 21 U.S.C. § 1904(c), 31
C.F.R. § 598.312. Additionally, the government expects to show at trial that the defendant
changed the name of Las Flores Cabanas to Cabanas La Loma following the OFAC designation
Count Four of the indictment alleges that the defendant engaged in transactions or
dealings with two entities, Mizu Sushi Lounge and Operadora Los Famosos, S.A. de C.V., d/b/a
Kenzo Sushi. Mizu Sushi Lounge was designated by OFAC on September 17, 2015, and
thereafter changed its name to Kenzo Sushi, under the corporate umbrella of Operadora Los
Famosos, S.A. de C.V. Operadora Los Famosos was then designated by OFAC on September
14, 2017. The government expects to show at trial that the defendant applied for and owned the
Mexican trademark for Mizu Sushi Lounge, and continues to own the trademark today.
Additionally, the government expects to show that Mizu Sushi Lounge’s name change to Kenzo
Sushi was motivated by the OFAC designation, because no other change was made to the
business, which kept its logo, phone number, chefs, and menu. The government also expects to
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 4 of 24
show financial connections between the defendant and the re-named restaurant that continued
Count Five of the indictment alleges that the defendant engaged in transactions or
dealings with a tequila company known as Onze Black, which was designated by OFAC on
September 17, 2015. As with Las Flores Cabanas and Mizu Sushi, the government expects to
show at trial that the defendant applied for and owned the Mexican trademark for Onze Black,
designated entities in other ways, including through photographs and social media postings.
Although the government does not need to show that the defendant had actual notice of the
particular OFAC designations, 4 the government nonetheless expects to show that the defendant’s
continuing transactions and dealings with the designated businesses were willful through a
variety of documentary evidence. First, the government anticipates that corporate registration
documents will show that the defendant dissolved the two legally incorporated entities, J&P
Advertising and JJGON, shortly after the OFAC designation. 5 Second, the government
anticipates that financial documents, corporate registration documents, and social media postings
will show that the defendant changed the names of Mizu Sushi and Las Flores Cabanas
following their designations, in an effort to evade the OFAC sanctions. Third, the government
expects to show that OFAC “blocking notices” providing notice of the sanctions were provided
4
See infra. Section II.A.
5
Among other things, an OFAC designation would have limited those entities’ access to
financial institutions, web hosting services, and other business-to-business services. This both
provides an explanation for the decision to dissolve the businesses as well as further evidence
that the defendant willfully violated the OFAC sanctions by continuing to try to transact and deal
with the designated entities even after the businesses’ operations had been interrupted by other
companies’ decisions not to deal with or service the companies.
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 5 of 24
to an address previously used by the defendant in 2015, that such notices were provided to
various family members of the defendant in 2015, and that one was personally hand-served on
the defendant in 2019, but that at no time did the defendant seek a license from OFAC or
otherwise seek to unwind her involvement in the designated businesses. Fourth, the government
anticipates that messages sent to the defendant by one or more U.S.-based web hosting services
will show that she was directly made aware of the OFAC sanctions by the web hosting services
when they decided to disable her accounts in order to avoid transacting business with designated
entities. 6
The proposed evidence generally relates to the fourth category of documentary evidence
described above, which is evidence from web hosting services used by the defendant.
Specifically, the government anticipates introducing direct documentary evidence related to the
August 19, 2015, OFAC designated BRIC Inmobiliaria as a Specially Designated Narcotics
Trafficker pursuant to the Kingpin Act. Although the instant charges against the defendant do
not include charges related to BRIC Inmobiliaria, the government’s investigation has revealed
that the defendant transacted or dealt with BRIC Inmobiliaria in a manner that is probative of the
charged conduct.
In particular, the government’s investigation has revealed that the defendant, through her
company J&P Advertising, was the listed registrant for BRIC Inmobiliaria’s web address,
6
This paragraph’s description of anticipated documentary evidence is not intended to be
exhaustive, but rather only to provide context for this motion. It should not be read to limit the
proof that the government may present, nor does it account for non-documentary evidence in the
form of witness testimony.
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 6 of 24
service used by the defendant to register BRIC Inmobiliaria’s website, Bluehost, decided to
deactivate the defendant’s web hosting account. The defendant used the same account to register
a number of other web domains as well, including domains related to businesses subject to the
(cabanaslasflores.com, lasflorescabanas.com), and others. The web hosting service sent the
defendant a notice on August 23, 2015, alerting her of the OFAC sanctions and its decision to
Jessica,
It has recently come to our attention that a package under your control is
providing service to individuals or businesses specifically designated as
blocked . . . . Directives enforced by the Office of Foreign Assets Control
(OFAC) of the U.S. Department of the Treasury, which administers and
enforces trade and economic sanctions in accordance with U.S. policy, do
not allow us as a U.S. company to do business with persons or entities on
the blocked list . . . .
At this time, the account or accounts in question have been suspended and
disabled. This means that your websites are not currently accessible to
visitors, and you cannot log into your account. . . . 7
Records from the web hosting service show that the very next day, a phone number
registered to the Guadalajara, Mexico area – where the defendant resided and ran her businesses
– contacted the company’s customer service line and had a 26-minute phone call. Thereafter, the
web hosting service appears to have severed the BRIC Inmobiliaria domain registration from the
defendant’s web hosting account in order to permit temporary reactivation of her account.
7
This record and others received from the web hosting service have been provided to the
defendant in discovery.
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 7 of 24
The next month, on September 17, 2015, OFAC designated additional businesses
connected to the defendant: JJGON, J&P Advertising, Mizu Sushi, Tequila Onze Black, and Las
Flores Cabanas. Thereafter, records from the web hosting service show that the defendant’s
domain registration account was again deactivated, and that the domain registrations for J&P
Advertising, Mizu Sushi, Tequila Onze Black, and Las Flores Cabanas, among others, were
related testimony, possibly to include testimony from investigative agents, representatives of the
of the web hosting service, associates of the defendant who were aware of her activities vis-à-vis
BRIC Inmobiliaria, associates of the defendant who were aware of her involvement in registering
C. Argument
Evidence of other crimes, wrongs, or acts is not admissible to prove the character
of a person in order to show action in conformity therewith. It may, however, be
admissible for other purposes, such as proof of motive, opportunity, intent,
preparation, plan, knowledge, identity, or absence of mistake or accident, provided
that upon request by the accused, the prosecution in a criminal case shall provide
reasonable notice in advance of trial, or during trial if the court excuses pretrial
notice on good cause shown, of the general nature of any such evidence it intends
to introduce at trial.
Fed. R. Evid. 404(b).
Rule 404(b) “excludes only evidence ‘extrinsic’ or ‘extraneous’ to the crimes charged,
not evidence that is ‘intrinsic’ or ‘inextricably intertwined.’” United States v. Allen, 960 F.2d
1055, 1058 (D.C. Cir. 1992), cert. denied, 506 U.S. 881 (1992); see also United States v.
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 8 of 24
Gartmon, 146 F.3d 1015, 1020 (D.C. Cir. 1998) (holding evidence that defendant charged with
fraud had threatened a co-conspirator not “other crimes evidence” but instead “inextricably
This Circuit has defined intrinsic “other crimes” evidence this way:
Evidence of criminal activity other than the charged offense is not considered
extrinsic if it is an uncharged offense which arose out of the same transaction or
series of transactions as the charged offense, if it was inextricably intertwined with
the evidence regarding the charged offense, or it is necessary to complete the story
of the crime of trial . . .
United States v. Badru, 97 F.3d 1471, 1474 (D.C. Cir. 1996), cert. denied, 520 U.S. 1150 (1997)
(citing United States v. Weeks, 716 F.2d 830, 832 (11th Cir. 1983)).
Intrinsic evidence is admissible as direct evidence of the crimes charged and not subject
to analysis under Federal Rule of Evidence 404(b). Because intrinsic evidence, “by its very
nature, does not involve other crimes, wrongs or bad acts…there is no concern that it might be
used as improper character evidence,” United States v. Lerma-Plata, 919 F. Supp. 2d 152, 156
crime [or intrinsic], courts typically treat it as the same crime,” United States v. Bowie, 232 F.3d
923, 928 (D.C. Cir. 2000), and admit such evidence. The D.C. Circuit has explicitly recognized
“that evidence can be intrinsic to the crimes charged.” United States v. Sitzmann, 856 F. Supp.
2d 55, 59 (D.D.C. 2012). According to the Bowie court, “(at least) two types of evidence may be
properly considered ‘intrinsic,’ that is, not subject to Rule 404(b): (1) evidence ‘of an act that is
part of the charged offense’; and (2) evidence of ‘some uncharged acts performed
contemporaneously with the charged crime…[that] facilitate the commission of the charged
crime.’” Lerma-Plata, 919 F. Supp. 2d at 156 (quoting Bowie, 232 F.3d at 929).
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 9 of 24
The D.C. Circuit also acknowledged that there are even “several forms of ‘other crimes’
evidence . . . [that] are not considered extrinsic within the meaning of Rule 404(b).” Badru, 97
F.3d at 1474. For instance, evidence of uncharged crimes may be intrinsic if it “arose out of the
same series of transactions as the charged offense…or it is necessary to complete the story of the
crime on trial.” Weeks, 716 F.2d at 832. Thus, “[a]s long as evidence of the uncharged criminal
conduct is offered as direct evidence of a fact in issue and not as circumstantial evidence of the
character of the accused, it is admissible independent of its superficial similarity to that which
would be considered evidence of ‘other crimes’ under Rule 404(b).” United States v. Gray, 292
F. Supp. 2d 71, 77-78 (D.D.C. 2003) (citing Badru, 97 F.3d at 1475) (citing 22 Charles A.
Wright and Kenneth W. Graham, Jr., Federal Practice and Procedure § 5239 at 450 (1978)).
registering BRIC Inmobiliaria’s web domain – and, as a result, receiving notification from the
web host that it was shutting down her account because of the OFAC sanctions – should be
admitted as inextricably intertwined and intrinsic to the charged conduct. The defendant used
the same account with the web hosting service to register accounts for both BRIC Inmobiliaria
and several of the later-designated businesses that are the subject of the indictment. Fortuitously,
she received notice from the web hosting service informing her of the OFAC sanctions related to
BRIC Inmobiliaria’s OFAC designation first, shortly before the later designations of the
businesses named in the indictment, but it nonetheless informed her of the OFAC sanctions
regime and its consequences. And, indeed, the message sent to the defendant by the web hosting
service informing her of the decision to suspend her account due to the OFAC designation did
not specifically reference BRIC Inmobiliaria. Instead, it shut down her entire account. So when
her account was again banned by the web hosting service a month later on account of the OFAC
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 10 of 24
designations that underlie the indictment, the previous notification message that she had received
still supplied the reason: the web hosting service would not do business with her because of her
For this reason, the defendant’s connection to BRIC Inmobiliaria, and the fact that she
received a notice from the web hosting service related to the OFAC sanctions, bears directly on
her willfulness in continuing to transact and deal with the designated entities. In other words,
although specific notice of an OFAC designation is not required to prove a violation of the
Kingpin Act, the fact that the defendant did receive notice from the web hosting service is
powerful evidence of the willfulness of her conduct. And because the defendant used the same
account with the web hosting service to register web domains for BRIC Inmobiliaria and several
of the businesses in the indictment, the proposed evidence stemming from the earlier BRIC
Inmobiliaria OFAC designation is intrinsic to, and inextricably intertwined with, her registration
In the alternative, evidence of the defendant’s connection to BRIC Inmobiliaria and the
fact that she received notice from the web hosting service that it was suspending her account
Rule 404(b) permits the admission of “evidence of other crimes, wrongs, or acts” to
prove a material issue other than character, such as “motive, opportunity, intent, preparation,
plan, knowledge, identity and absence of mistake or accident.” Fed. R. Evid. 404(b). “Under the
law of this circuit, ‘Rule 404(b) is a rule of inclusion rather than exclusion’…and it is ‘quite
permissive,’ excluding evidence only if it is offered for the sole purpose of proving that a
person’s actions conformed to his or her character.” United States v. Long, 328 F.3d 655, 660-61
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 11 of 24
(D.C. Cir. 2003) (quoting Bowie, 232 F.3d at 923) (citations and quotations omitted). The Rule
lists several permissible purposes of other crimes – e.g., to prove “motive, opportunity, intent,
preparation, plan, knowledge, identity and absence of mistake or accident;” however, this list is
“not exhaustive.” United States v. Miller, 895 F.2d 1431, 1435 (D.C. Cir. 1990). “[T]he
Government need not show that the evidence is being offered for one of the purposes specifically
enumerated in the rule,” Lerma-Plata, 919 F. Supp. 2d at 155. As the D.C. Circuit noted, “in
some cases ‘[e]xtrinsic acts evidence may be critical…especially when th[e] issue involves the
actor’s state of mind and the only means of ascertaining that mental state is by drawing
inferences from conduct.” United States v. Brown, 597 F.3d 399, 404 (D.C. Cir. 2009) (quoting
Huddleston v. United States, 485 U.S. 681, 685 (1988)). Even a collateral showing of character
is insufficient to bar the evidence. As the D.C. Circuit has explained, “under Rule 404[b], ‘any
purpose for which bad acts evidence is introduced is a proper purpose so long as the evidence is
not offered solely to prove character.’” United States v. Cassell, 292 F.3d 788, 795 (D.C. Cir.
This Circuit has accepted a two-pronged test for determining whether evidence of prior
crimes is admissible under 404(b). 8 First, the evidence must be “probative of a material issue
other than character.” See Miller, 895 F.2d at 1435 (quoting Huddleston, 485 U.S. at 686)).
Second, the evidence is subject to the balancing test of Federal Rule of Evidence 403, so that it is
inadmissible only if the prejudicial effect, or to a lesser extent the effect of any other
consideration under Rule 403, of admitting the evidence substantially outweighs its probative
8
The Miller Court notes that “[t]his two-step analysis—certification of a ‘proper’ and relevant
purpose under Rule 404(b), followed by the weighing of probity and prejudice under Rule 403—
is firmly rooted in the law of this circuit.” Miller, 895 F.2d at 1435 (citing United States v. Manner,
887 F.2d 317, 321 (D.C. Cir.1989), cert. denied 493 U.S. 1062 (1990) and United States v. Lavelle,
751 F.2d 1266, 1275 (D.C. Cir. 1985), cert. denied, 474 U.S. 817 (1985)).
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 12 of 24
value. See id. Even so, these considerations “[g]enerally . . . do not flatly prohibit the
introduction of such evidence but instead limit the purpose for which it may be introduced.”
In assessing the relevance of other acts evidence under the first prong, the court “neither
weighs credibility nor makes a finding that the Government has proved the conditional fact by a
preponderance of the evidence. The court simply examines all the evidence in the case and
decides whether the jury could reasonably find the conditional fact . . . by a preponderance of the
evidence.” Id. at 690. As to the probative value of such evidence, the court should consider “the
similarity of the bad act with the charged offense, the time separating the two events, and the
prosecution’s need for the evidence.” United States v. Lavelle, 751 F.2d 1266, 1277 (D.C. Cir.),
cert. denied, 474 U.S. 817 (1985) (citations and footnote omitted), abrogated on other grounds
In this case, evidence of the defendant’s connection to BRIC Inmobiliaria and the
notification provided to her by the web hosting service that it was suspending her account
because of the OFAC designation should be admitted as evidence that demonstrates a common
scheme or plan, as well as the defendant’s intent, knowledge, and lack of mistake, pursuant to
Rule 404(b), in continuing to transact and deal with the designated businesses that underlie the
indictment. Evidence that the defendant’s web hosting service notified her that it would no
longer do business with her because of the OFAC designation of BRIC Inmobiliaria, after which
she either continued to operate the designated entities or, in the case of Mizu Sushi and Las
Flores Cabanas, changed their names, is powerful evidence of her intent, knowledge, and lack of
mistake in transacting with the designated businesses. Indeed, without conceding the
defendant’s position on the appropriate willfulness standard, this is precisely the kind of
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 13 of 24
evidence that defense counsel previously argued that the government would have to present at
trial. As the defendant’s counsel argued at the detention hearing, “the government would have to
prove that Ms. Gonzalez knew the specific law or conduct she violated . . . [or] that Ms.
Gonzalez knew it was unlawful to deal with designated entities . . . .” See March 3, 2020
It is well-established that intent may be inferred by the repetition of similar acts and thus
courts regularly admit evidence of the commission of similar crimes to prove intent. See, e.g.,
United States v. Douglas, 482 F.3d 591, 596-597 (D.C. Cir. 2007) (holding that evidence that
[the defendant] previously possessed and distributed crack cocaine to an undercover police
officer has a tendency to make “it more probable,” both that he knew the nature of the substance
that he was charged with possessing and that he intended to distribute it.); United States v. Crum,
57 F.3d 1071, 1995 WL 364142, at *1-2 (6th Cir. 1995) (unpublished) (upholding admission of
prior bribe to prove intent in bribery prosecution); United States v. Zedner, 401 F.3d 36, 49-50
(2d Cir. 2005) (holding in prosecution for defrauding a financial institution evidence of two prior
episodes where the defendant committed mortgage fraud were admitted to prove defendant's
“financial sophistication, his ability to execute complex schemes, and his ability to form intent to
defraud.”). If other crimes evidence is offered to show intent, “[w]hat matters is that the
evidence be relevant to show a pattern of operation that would suggest intent and that tends to
undermine the defendant's innocent explanation.” United States v. Long, 328 F.3d 655, 661
(D.C. Cir. 2003) (citation and internal quotation marks omitted). In this case, evidence that the
defendant had previously been informed that her web hosting account was being shut down
because of her connection to BRIC Inmobiliaria upon its designation by OFAC undermines any
“innocent” explanation that she did not know why her websites for Las Flores Cabanas, Tequila
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 14 of 24
Onze Black, Misu Sushi, and J&P Advertising, among others, were also shut down following the
prove knowledge and absence of mistake. See, e.g., United States v. Johnson, 970 F.2d 907,
913-14 (D.C. Cir. 1992) (finding admission of two prior moneygram frauds to establish
knowledge and participation in charged moneygram fraud scheme); United States v. Brown, 597
F.3d 399, 404-405 (D.C. Cir. 2010) (upholding admission of other crimes evidence regarding
motive, and absence of mistake or accident); United States v. Wilson, 31 F.3d 510, 515 (7th Cir.
1994) (admitting evidence of other drug activity because it “tend[ed] to show that [the defendant]
was familiar with the cocaine business and was not some innocent bystander mistakenly caught
up in an overzealous law enforcement”); United States v. Leahy, 82 F.3d 624, 636 (5th Cir.
1996) (finding in prosecution for conspiracy to defraud the United States, other instances of
submitting false invoices admitted to prove intent and negate mistake); Perholtz, 842 F.2d at 358
(holding in an appeal from convictions for several schemes to fraudulently procure U.S. Postal
Service contracts, the court upheld the admission of evidence that was “highly probative of
efforts to further an ongoing scheme to defraud and demonstrate[d] conscious awareness of guilt
on the part of the defendants”), cert. denied, 488 U.S. 821 (1988).
knowledge and absence of mistake regarding the charged offenses. In short, the evidence of the
defendant’s connection to BRIC Inmobiliaria and the communication from the web hosting
service detailing the OFAC violation make it substantially more probable that the defendant
knew of the OFAC sanctions regime, knew that it was unlawful to transact or deal with
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 15 of 24
designated entities, and yet continued to operate the entities that are the subject of the indictment.
See, e.g., United States v. Bussey, 432 F.2d 1330 (D.C. Cir. 1970) (where the Government seeks
to introduce evidence of prior offenses to prove identity and that prior and subsequent offenses
are so nearly identical in method as to mark them as handiwork of accused, such evidence should
be part of the government's case-in-chief.) Further, as the defense is anticipated to argue the
defendant had no knowledge of the OFAC designations or the unlawfulness of her conduct,
evidence of similar prior dealings with a designated entity and, in particular, evidence of her
receiving notice that it was unlawful to deal with that entity on account of the designation, is
critical to the government in negating such an argument. Accordingly, this evidence should be
As to the second prong of the D.C. Circuit’s 404(b) inquiry, “the relevant inquiry…is
prejudice.” Lerma-Plata, 919 F. Supp. 2d at 159. This Circuit has noted that it is not enough
that the evidence is simply prejudicial; the prejudice must be “unfair.” See Cassell, 292 F.3d at
796 (quoting Dollar v. Long Mf’g, N.C., Inc., 561 F.2d 613, 618 (5th Cir. 1977) (“Virtually all
evidence is prejudicial or it isn’t material. The prejudice must be unfair”); Sitzmann, 856 F.
Supp. 2d at 61-62 (“the test under Rule 403 is ‘unfair prejudice,’ not just any prejudice or harm
to the defense.”)) For evidence to be unfairly prejudicial within the meaning of the Rule, it must
have “‘an undue tendency to suggest decision on an improper basis, commonly, though not
necessarily, an emotional one.’” Old Chief v. United States, 519 U.S. 172, 180 (1997) (quoting
Furthermore, Rule 403 strongly favors admission of 404(b) evidence. “Rule 403 tilts, as
do the rules as a whole, toward the admission of evidence in close cases, even when other crimes
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 16 of 24
evidence is involved.” United States v. Douglas, 482 F.3d 591, 600 (D.C. Cir. 2007) (citing
Cassell, 292 F.3d at 795) (internal quotation marks omitted). “In determining whether ‘the
probative value is substantially outweighed by the danger of unfair prejudice’ it is a sound rule
that the balance should generally be struck in favor of admission when the evidence indicates a
close relationship to the event charged.” United States v. Harrison, 679 F.2d 942, 948 (D.C. Cir.
1982) (quoting United States v. Day, 591 F.2d 861, 878 (D.C. Cir. 1978)).
The D.C. Circuit has consistently minimized the risk of potential prejudice not by
exclusion, but by issuing limiting instructions to the jury. See, e.g., Cassell, 292 F.3d at 796
(emphasizing the significance of the district court’s instructions to jury to “consider the evidence
for the limited and proper purposes”); Douglas, 482 F.3d at 601 (same); Pettiford, 517 F.3d at
590 (same); United States v. Crowder, 141 F.3d 1202, 1210 (D.C. Cir. 1998) (en banc) (stating
that mitigating instructions to jury enter into the Rule 403 balancing analysis); United States v.
Mitchell, 49 F.3d 769 (D.C. Cir. 1995) (stating that limiting instructions concerning other crimes
evidence may guard against improper inferences). “[I]t is the law, pure and simple, that jury
instructions can sufficiently protect a defendant’s interest in being free from undue prejudice.”
United States v. Perholtz, 842 F.2d 343, 361 (D.C. Cir.), cert. denied, 488 U.S. 821 (1988)
(citation omitted).
The proposed evidence should not be excluded under Rule 403 because the probative
value substantially outweighs any possible prejudicial effect. The law in this Circuit is clear that
in balancing the probativeness and prejudice of other crimes, “it is a sound rule that the balance
should generally be struck in favor of admission when the evidence indicates a close relationship
to the offense charged.” Harrison, 679 F.2d at 948 (internal quotation marks and citation
omitted). That other crimes evidence may be prejudicial “does not suggest that such evidence
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 17 of 24
has an automatic unfair and substantial prejudicial effect on the jury.” Cassell, 292 F.3d at 796.
Furthermore, the extent of any prejudice, or the potential misuse of such evidence by the jury,
can effectively be eliminated by limiting instructions that the Court can make either concurrent
with the introduction of the evidence at trial or during final jury instructions.
Here, the defendant is charged with criminal violations of the Kingpin Act connected
with six different Mexico-based businesses. If interpreted as “other crime” evidence, evidence
also designated by OFAC. To the extent that there is any, the additional prejudice from that
connection is slight indeed. This is a far cry from cases in which a party seeks to introduce an
inherently inflammatory or shocking “other crime” in connection with a defendant on trial for
non-violent charges that do not provoke the conscience. See, e.g., United States v. Lawson, 410
F.3d 735, 742 (D.C. Cir. 2005) (admitting evidence where it did not “add [] emotional or other
pejorative emphasis not already introduced” by evidence of the charged conduct). And on the
other hand, the probative value of the proposed evidence is substantial. It shows that the
defendant received specific notice – albeit from an unexpected source, her web hosting service –
of the illegality of transacting with OFAC-designated entities even before her companies were
designated by OFAC. This Court has explained in a different context that evidence that the fact
that the defendant’s husband had been sanctioned by OFAC was probative of the likelihood that
she acted willfully. See Transcript, Mar. 3, 2020, Dkt. No. 25 at 48-49 (“I do find it quite
probative on this score – that the defendant’s own husband had been sanctioned for violations of
OFAC regulations, that some familiarity of the severity and seriousness of an OFAC notice
would lend – would strain credulity that she did not try and look up and figure out what this was
about . . . .”). Here, too, the fact that the defendant’s web sites had been completely shut down
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 18 of 24
BRIC Inmobiliaria’s designation and the resulting exchanges with the web hosting service
should be admitted.
Rule 401 defines “relevant evidence” as evidence having “any tendency to make a fact
more or less probable than it would be without the evidence,” where “the fact is of consequence
in determining the action.” Rule 402, in turn, provides that irrelevant evidence is not admissible.
See United States v. Doe, 903 F.2d 16, 21 (D.C. Cir. 1990) (“Irrelevance is not defined, but it is
clear that any evidence failing the test of Rule 401 is “not relevant” under Rule 402.”).
Pursuant to Rule 403, even relevant evidence may be excluded “if its probative value is
confusing the issues, misleading the jury, undue delay, wasting time, or needlessly presenting
cumulative evidence.” Courts also have broad discretion to exclude evidence if it has an “undue
emotional one.” Fed. R. Evid. 403 Advisory Committee’s Note. “Courts therefore frequently
employ Rule 403 to exclude irrelevant, confusing, and misleading evidence.” United States v.
The defendant may attempt to suggest through argument and elicitation of testimony that
the defendant’s receipt of actual notice of OFAC’s particular designation of the specific
businesses named in the indictment is a required element of the charged offense. On multiple
occasions, orally and in pleadings, before this Court and the D.C. Circuit, the defendant has
argued that she did not receive, review, or read any blocking notice for the five businesses named
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 19 of 24
in the Indictment. See, e.g. March 3, 2020 Transcript, Dkt. No. 25, at 23 (“Exhibit 1 [an OFAC
blocking notice letter] does not reference any entity that’s listed in the Indictment. There is no
evidence that my client ever received this letter.”); id. at 25 (“There is no evidence that I am
aware of that shows that my client read the [T]reasury press release, that she read the notice in
the Federal Register or even accessed the [T]reasury [D]epartment's website.”); United States v.
Oseguera Gonzalez, D.C. Cir. Nos. 20-3018 & 20-3023, Appellant Br. at 12 (“No evidence was
presented by the government to show that Ms. Gonzalez read the [] Treasury press release, read
the notice in the Federal Register, or accessed [] Treasury’s website”), id. at 13 (“no evidence to
show that Ms. Gonzalez actually received post-designation notice”). For the reasons set forth
below, the Court should preclude the defendant from suggesting to the jury that the defendant’s
First, notice is not an element of the offense. See 21 U.S.C. § 1906. Although the
government has to prove “willful” violation, see 21 U.S.C. § 1906(a)(1), it does not have to
prove that the defendant received notice of OFAC’s designations. To suggest that the
government must prove that the defendant received notice that a particular business has been
designated would amount to a requirement that the government prove that the defendant was
aware of the specific law or rule that the conduct violates. However, this Court and several
circuits have held that this is not the appropriate willfulness standard for Treasury sanctions
cases.
While there is little Kingpin Act-specific case law, the D.C. Circuit has previously
explained that the Kingpin Act was modeled on the International Emergency Economic Powers
Act (“IEEPA”) and has looked to IEEPA cases in interpreting the Kingpin Act. See Zevallos v.
Obama, 793 F.3d 106, 109-113 (D.C. Cir. 2015); see also 21 U.S.C. § 1901 (“IEEPA was
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 20 of 24
successful case study, Congress believes similar authorities should be applied worldwide.”).
IEEPA criminalizes the willful violation of economic sanctions in much the same manner as the
Kingpin Act. Compare 50 U.S.C. § 1705(c) (“A person who willfully commits . . . an unlawful
act described in subsection (a) . . . .”) with 21 U.S.C. § 1906(a)(1) (“Whoever willfully violates
the provisions of this chapter . . .”). Courts consistently have held that the IEEPA willfulness
standard requires only that a defendant know that his or her conduct was unlawful, not that he or
she knew the precise details of the law being violated. See United States v. Quinn, 403 F. Supp.
2d 57, 60-66 (D.D.C. 2005) (rejecting argument that government had to prove defendants’
“specific knowledge” of the OFAC licensing requirement); United States v. Mousavi, 604 F.3d
1084, 1094 (9th Cir. 2010) (“[W]e reject Mousavi’s argument that the government [] had to
prove that Mousavi had a specific understanding of the [Iranian Transaction Regulations]
licensing requirements.”); United States v. Turner, 836 F.3d 849, 860 (7th Cir. 2016) (affirming
jury instruction that defendant “need not be aware of the specific law or rule that his conduct
may be violating”). See also United States v. Elashyi, 554 F.3d 480, 505 (5th Cir. 2008); United
States v. Homa Int’l Trading Corp., 387 F.3d 144, 146-47 (2d Cir. 2004).
Additionally, the D.C. Circuit has held that the willfulness standard in the Arms Export
Control Act—which criminalizes exporting defense articles without a license —requires only
that the defendant knew that the conduct was unlawful, not “that a defendant had read, was
aware of, or had consulted the licensing provisions of the” statute. See United States v. Burden,
934 F.3d 675, 690-92 (D.C. Cir. 2019). In so ruling, the D.C. Circuit emphasized that the
Supreme Court “has required proof that a defendant know which law he was breaking in only
two contexts: criminal tax evasion, and currency structuring.” Id. at 691.
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 21 of 24
The United States does not need to prove that the defendant received, reviewed, or read
OFAC notices to establish that the defendant willfully violated the Kingpin Act. Courts
consistently have held in IEEPA cases that circumstantial evidence of subjective knowledge,
including efforts to conceal conduct, and willful blindness are sufficient to prove willfulness.
See Homa, 387 F.3d at 147 (holding that sufficient evidence of willfulness existed where
evidence showed that defendant’s bank refused to complete transactions on two occasions,
OFAC wrote defendant letters alerting him to regulations, and the defendant “conducted his
business practices in stealth”); United States v. Soussi, 316 F.3d 1095, 1103–07 (10th Cir. 2002)
trailers, and modifying invoices—as well as a refusal to read a general fact sheet on the U.S.
embargo on Libya was sufficient evidence of willfulness); Mousavi, 604 F.3d at 1094–95
(evidence that the defendant concealed his dealings from the government on his tax returns, in
addition to the fact that the defendant regularly traveled to and conducted business in Iran, was
sufficient to indicate knowledge of unlawfulness); United States v. Abdullaev, 761 F. App'x 78,
81–82 (2d Cir. 2019) (actions suggesting purposeful circumvention of regulations and evidence
suggesting a detailed knowledge of U.S. export regulations due to personal employment was
For the foregoing reasons, the government submits that any statements, questions and
arguments that suggest that notice is an element of the offense would confuse the issues, mislead
the jury, and result in unfair prejudice to the government. See Fed. R. Evid. 403. Thus the Court
should preclude the defendant from suggesting that the government must prove that the
defendant received notice of the designations during jury addresses or the presentation of
Pursuant to the Kingpin Act, the President may designate “significant foreign narcotics
traffickers,” 21 U.S.C. § 1904(b)(1), and the Secretary of the Treasury, through delegated and
statutory authority, may designate and block the assets of foreign persons generally involved in
§ 1904(b)(2)-(4). A criminal prosecution for violation of the Kingpin Act, in turn, relies on these
issued under the Kingpin Act). Accordingly, the issue for the jury at trial is the defendant’s
willful violation of the Kingpin Act’s sanctions, not the underlying designations themselves.
The Court should therefore preclude the defendant from challenging the validity of the OFAC
designations.
element of [the crime], but the validity of the designation is not.” United States v. Hammoud,
381 F.3d 316, 331 (4th Cir. 2004) (emphasis in original), cert. granted, judgment vacated, 543
U.S. 1097 (2005), opinion reinstated in part, 405 F.3d 1034 (4th Cir. 2005) (rejecting the
(“FTO”)). See also United States v. Bozarov, 974 F.2d 1037, 1045–46 (9th Cir.1992) (holding
Administration Act did not violate due process because the validity of the classification was not
an element of the offense); United States v. Mandel, 914 F.2d 1215, 1222 (9th Cir. 1990)
(holding that a criminal defendant could not collaterally attack the Secretary of Commerce's
decision to place an item on the Commodity Control List and declining defendant's discovery
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 23 of 24
request for information underlying the determination); Yakus v. United States, 321 U.S. 414,
447, 64 S. Ct. 660, 678, 88 L. Ed. 834 (1944) (holding that the defendant could not collaterally
attack the validity of the Emergency Price Control Act price regulations that the government
(S.D.N.Y. Nov. 18, 2013), Dkt. No. 70 at 9 (finding that a defendant may not relitigate his
designation by OFAC in a criminal trial in which he was charged with violating IEEPA as a
A violation of the Kingpin Act, similar to the statutes addressed by the aforementioned
courts, requires only proof that the named entity that the defendant transacted with was in fact
designated. See 21 U.S.C. 1904(c) and 1906(a). OFAC’s decision to designate an entity under
the Kingpin Act “does not involve the defendant's individual rights and is not an element of the
For the foregoing reasons, the government submits that any statements, questions and
arguments that challenge the OFAC designations would confuse the issues, mislead the jury, and
result in unfair prejudice to the government. See Fed. R. Evid. 403. Thus the Court should
preclude the defendant from challenging the designations during jury addresses or the
CONCLUSION
For the foregoing reasons, the Court should grant the government’s motions to
(1) introduce other crimes evidence related to the defendant’s association with BRIC
Inmobiliaria, (2) preclude argument and elicitation of testimony suggesting that actual notice of
specific OFAC designations is a required element of the charged crime, and (3) preclude
argument and elicitation of testimony designed to challenge the underlying OFAC designations.
Case 1:20-cr-00040-BAH Document 63 Filed 07/13/20 Page 24 of 24
By: /s/
Kate Naseef, Trial Attorney
Kaitlin Sahni, Trial Attorney
Brett Reynolds, Trial Attorney
Narcotic and Dangerous Drug Section
Criminal Division
U.S. Department of Justice
Washington, D.C. 20530
Telephone: (202) 598-2493