1-Response by USA

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO

UNITED STATES OF AMERICA,

Plaintiff,

vs.

RICK REESE, TERRI REESE, AND
RYIN REESE,

Defendants.
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NO. 11-CR-2294 RB

UNITED STATES RESPONSE TO DEFENDANTS
JOINT MOTION TO VACATE FELONY CONVICTION

The United States hereby responds to Defendants J oint Motion to Vacate Felony
Conviction, or in the Alternative, Motion for Variance. (Doc. 479).
1
The government
respectfully requests that the Court deny the motion in its entirety because it is without legal or
factual support.
I. Background
a. Procedural History
On August 24, 2011, a federal grand jury returned a 30-count indictment against Rick,
Terri, and Ryin Reese, and their co-defendant, Remington Reese. (Doc. 2). The defendants
were tried by a jury beginning on J uly 17, 2012. (Docs. 347, 349, 350). On J uly 31, 2012, the
Court granted the defendants motion for acquittal as to counts 29 and 30, but denied it with
respect to all other counts. (Doc. 360). On August 1, 2012, the jury found Ryin guilty of counts
7 and 8, Rick guilty of count 9, and Terri guilty of count 10. (Doc. 353). These counts charged

1
Citations to "Doc.___" are to the number of the pleading on the district court's docket sheet.
Case 2:11-cr-02294-RB Document 488 Filed 09/23/14 Page 1 of 8

United States v. Rick Reese, Terri Reese, and Ryin Reese
United States Response to Defendants Joint Motion to Vacate Felony Convictions
Page 2 of 8

the named defendants with aiding and abetting a person knowingly making false statements in
violation of 18 U.S.C. 924(a)(1)(A). The jury acquitted the defendants on all other counts. Id.
After the Tenth Circuit affirmed the jury verdict and the defendants convictions, the Court
ordered that defense counsel file their sentencing memoranda and objections by September 8,
2014, and ordered the Government to respond by September 22, 2014. (Docs. 471). The
defendants then filed objections to their presentence reports, motions for downward departures,
and the instant motion. (Docs. 478-82). Sentencing hearings have not yet been set.
b. Facts Established at Trial
2

Beginning in March 2010, Penny Torres bought 23 AK-47 type firearms from New Deal
Shooting Sports in the span of about six months. Rick Reese owned New Deal and operated it
with his wife, Terri, and two sons, Ryin and Remington. New Deal was a federally licensed
firearms dealer, so its customers had to complete and sign under oath an ATF Form 4473.
Through an investigation conducted by HSI, it was later revealed that Torres was purchasing the
firearms for J ose Roman. Roman worked for La Linea, the enforcement arm of the J uarez drug
cartel, and it was in this capacity that he bought and exported firearms and ammunition to Mexico.
After discovering the connection between Torres and Roman, HSI began an undercover
investigation into New Deal. As part of that operation, Roman and HSI Special Agent Daniel
Ramirez went to New Deal on J une 15, 2011, to pick up a .50caliber weapon Roman previously
ordered. Roman counted out and handed over $3600 in cash to Ryin, and told him, Always
taking my money. Ryin then explained Roman's receipt to him, and during that conversation

2
The facts are taken entirely from the factual summary as set out by the Tenth Circuit in United
States v. Reese, 745 F.3d 1075, 1078 (10th Cir. 2014).

Page 3 of 8

Roman told Ryin about his plan to sell the .50caliber weapon in Mexico. Ryin replied, I don't
need to know that. Roman then assured Ryin that he had paid off the Mexican police to the tune
of $5000 per month, so that Ryin should not to worry about law enforcement finding the firearm in
Mexico. Roman assured Ryin, Nothing is gonna come back to you. You are safe. Agent
Ramirez then filled out ATF Form 4473 for the weapon and falsely certified that he was the
.50-calibers actual buyer with Ryin's assistance. Before he left that day, Roman ordered another
.50-caliber weapon and arranged with Ryin to have a woman fill out the paperwork. Ryin told his
mother, Terri, that Roman wanted another .50-caliber weapon.
On J uly 7, 2011, Roman, Agent Ramirez, and HSI Special Agent Aida Cervera returned to
New Deal to pick up the .50-caliber weapon that Roman ordered on J une 15. On this occasion,
with Ryins understanding and consent, Roman picked out two additional AK-47 type rifles and
some ammunition, negotiated the price with Ryin and Terri, and then handed the cash for the
purchase to Agent Cervera. Agent Cervera then also filled out an electronic ATF Form 4473 with
Ryins help.
Roman visited the shop again on J uly 29, 2011, this time with HSI Special Agent Kelley
Wigley. When Terri asked Agent Wigley how she could help, Agent Wigley pointed to Roman
and said, Whatever he wants. During that same visit, Roman told Rick that he had been ordered
to buy $24,000 in rifles and ammunition by his people in Mexico and that he was looking to buy
another .50-caliber rifle. Rick responded that he had just received a .50-caliber rifle that was
similar to Romans other rifles. Later in that same visit, Roman told Rick that he wanted to
purchase three handguns. After discussing the types of handguns he was interested in and looking

Page 4 of 8

at several, he told Rick that Agent Wigley would pay. Rick told Roman that Agent Wigley could
fill out the paperwork and he would get Roman set up. Rick then showed Agent Wigley the
computer used to fill out the electronic ATF Form 4473, and Terri helped Agent Wigley fill it out.
II. The defendants were properly charged and convicted of felony offenses
Based on a district court opinion from the Fourth Circuit, the defendants argue that even
though they were indicted, tried and convicted by a jury of felony violations of the federal firearms
reporting requirements pursuant to 18 U.S.C. 924(a)(1)(A), the Court should convert those
convictions to misdemeanors under 18 U.S.C. 924(a)(3). The defendants argue they can only
be charged and punished under the narrower 924(a)(3) because they committed their crimes as
part of their work for New Deal, a federally licensed firearms dealer. As discussed below, the
Supreme Court and several circuit courts have considered the construction of the possible
substantive and penalty provisions applicable to federal firearms violations and all have decided
that the government has discretion to charge the same conduct under multiple provisions.
In United States v. Batchelder, the Supreme Court held that where the same conduct may
be charged and punished under separate statutes related to firearms offenses, the government has
the discretion to proceed under the substantive or penalty provision of its choice. 442 U.S. 114
(1979). In that case, the defendant was convicted pursuant to 18 U.S.C. 922(h) and sentenced to
5 years imprisonment, the statutory maximum. Id. at 116. The Seventh Circuit remanded for
resentencing to the lesser penalties set out in 18 U.S.C.App. 1202(a), reasoning that 1202(a)
implicitly repealed 922(h) because it was later enacted and contained the same substantive
elements as 922(h). Id. After reviewing the statutory scheme and legislative history, the

Page 5 of 8

Supreme Court reversed the Seventh Circuit. Id. at 118-22. In addition, the Supreme Court went
on to affirm its prior holdings that when an act violates more than one criminal statute, the
Government may prosecute under either so long as it does not discriminate against any class of
defendants. Id. at 123-24.
In line with this rule, the circuit courts have recognized that the government has discretion
to proceed against a federally licensed firearm dealer who knowingly makes a false statement on
an ATF Form 4473 under either 18 U.S.C. 924(a)(1)(A) or 924(a)(3). See United States v.
Carney, 387 F.3d 436, 444-46 (6th Cir. 2004) (holding that the government could choose to
proceed under 924(a)(1)(A) rather than 924(a)(3)); United States v. Al-Muqsit, 191 F.3d 928,
935-36 (8th Cir. 1999) (holding that the government could choose to proceed under 924(a)(1)(A)
rather than 924(a)(3)), judgment vacated en banc as to an unrelated defendant, 210 F.3d 820
(2000); see also United States v. Rietzke, 279 F.3d 541, 545-46 (7th Cir. 2002) (holding that
conduct punishable under 924(a)(3) can also be charged under 922(b)(5) and punished under
924(a)(1)(D)); United States v. Jarvouhey, 117 F.3d 440, 442 (9th Cir. 1997) (affirming
punishment under 924(a)(1)(D) where the offense was also chargeable under 924(a)(3)). The
government has this discretion because there are different degrees of possible violations of the
federal reporting requirements which the government could reasonably charge as either a
misdemeanor or felony. Under the statutory scheme, the government has the option of
misdemeanor prosecution for licensed dealers who make false statements on ATF forms, while
leaving intact the felony prosecutions structure for thosewhose flagrant and repeated actions in
accepting false ATF forms from straw purchaseswarrants felony punishment. Rietzke, 279

Page 6 of 8

F.3d at 546, quoting Al-Musqit, 191 F.3d ay 935 (alterations in the original).
The defendants in this case engaged in knowing and ongoing flagrant violations of the
federal firearms reporting requirements. As noted by the Tenth Circuit Court of Appeals, the
government presented damning evidence that the defendants engaged in each count of
conviction, including count 8, the poster child for what a straw purchase looks like. 745 F.3d at
1085-87. In addition, the government presented evidence that almost all of these purchases
related to AK-47 type weapons and that the defendants knew or had reason to know that the
weapons would be exported illegally to Mexico. Accordingly, the government exercised its
discretion to charge the defendants under 924(a)(1)(A) rather than 924(a)(3).
The governments choice in this case is supported by the Supreme Court and circuit
decisions cited above. These decisions take into account Congresss ability to give the
prosecution options and discretion regarding firearms reporting offenses. In addition, as noted by
the Seventh Circuit in Rietzke, 924(a)(3) was intended to ensure that a dealer would not be
subjected to harsh felony penalties for technical violations of the rigid record-keeping
standards[.] 279 F.3d at 546. As Rietzke makes clear, there is no reason to treat federally
licensed firearms dealers who knowingly violate their duties as licensees more leniently than the
prohibited persons they sell to.
In contrast to these well-reasoned opinions, the defendants rely on two district court cases
United States v. Wegg, 915 F.Supp. 898 (E.D.Va. 1996), and United States v. Percival, 727
F.Supp. 1015 (E.D.Va. 1990). The reasoning in these cases has been repeatedly rejected by
circuit courts. In Carney, the Sixth Circuit described Wegg as poorly reasoned and inconsistent

Page 7 of 8

with all published circuit court authority on the matter and gave the district court opinion zero
persuasive weight. 387 F.3d at 444, n.7. In Jarvouhey, the Ninth Circuit rejected Percivals
holding that 924(a)(3) was the only applicable penalty provision even when the defendant is
convicted of a violation of 922(b)(5). 117 F.3d at 442.
The Sixth and Seventh Circuits poor opinion of these cases is understandable. The
district courts in both Wegg and Percival used the principals of statutory interpretation to reach
absurd results. More specifically, the district courts held that, even though a federally licensed
firearms dealer is specifically charged with complying with the federal firearms reporting
regulations, Congress intended to limit liability for knowing participation by this class of
defendants in straw purchases. In addition, the district court in Wegg reasoned that accomplice
liability for a federally licensed firearms dealer for violations of 924(a)(1)(A) was similar to the
exceptions to accomplice liability for victims and those whose conduct is necessarily incident to
the offense. The district court compared the victim of a statutory rape as to the first exception and
a prostitute as an accomplice to solicitation as to the second. Both examples are flawed. As to
the first, unlike a federally licensed firearms dealer, the victim of a statutory rape is legally
incapable of consenting to the offense conduct. As to the second, a prostitute is a necessary
participant in the offense of solicitation, whereas a straw purchase may be conducted without the
knowing participation of a federally licensed firearms dealer.
The defendants were properly charged and convicted of knowingly participating in straw
purchases in violation of 924(a)(1)(A). As recognized by the Supreme Court and the several
circuits, their offenses are properly punishable as felonies because the defendants repeatedly

Page 8 of 8

engaged in flagrant violations of the federal firearms reporting requirements.
III. The defendants are not entitled to a variance to a misdemeanor sentence.
As previously addressed in the United States Omnibus Response to Defendants
Sentencing Motions and Objections, the defendants are not entitled to a variance in this case.
(Doc. 485 at 27-33). The defendants were tried and convicted of felonies, as affirmed by the
Tenth Circuit Court of Appeals, and they should be sentenced accordingly.
IV. Conclusion
Based on the foregoing authorities, the government requests that the defendants
motion be denied in its entirety as it is not supported by case law relevant to the issues presented,
and granting of the motion would lead to the absurd result that firearms dealers would be treated
more leniently than defendants who are convicted of identical conduct.
Respectfully submitted,
DAMON P. MARTINEZ
United States Attorney

Electronically filed 09/23/2014
MARIA Y. ARMIJ O
Assistant U.S. Attorney
555 S. Telshor Blvd., Ste. 300
Las Cruces, NM 88011
(575) 323-5276

I HEREBY CERTIFY that I electronically
filed the foregoing with the Clerk of the
Court using the CM/ECF system which
will send electronic notification to defense
counsel of record on this date.
/s/
MARIA Y. ARMIJ O
Assistant U.S. Attorney

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IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF NEW MEXICO

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