Motion To Withdraw Plea

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MEMORANDUM IN SUPPORT OF MOTION
TO WITHDRAW GUILTY PLEA Page 1
JEFFRY K. FINER
West 35 Main Suite 300
Spokane, WA 99201
(509) 981-8960

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF WASHINGTON

UNITED STATES OF AMERICA, )
) NO. CR 11-159-RHW
Plaintiff, )
)
v. ) MEMORANDUM IN SUPPORT
) OF MOTION TO WITHDRAW
DORIS NELSON, ) GUILTY PLEA
)
Defendant. )

MOTION TO WITHDRAW PLEA OF GUILTY
The Defendant, through her counsel of record Jeffry K. Finer and
Elizabeth Kelley
1
, moves this Court for an order vacating the Defendants
plea of guilty to all charges, originally entered on April 3, 2014, and submits
the following points and authorities in support of that motion.
FACTS
The Defendant was charged by superseding indictment filed on
December 18, 2013, with 110 counts of Wire Fraud (71 counts), Mail Fraud

1
Counsel Kelleys Motion for Admission Pro Hac Vice is pending.
Case 2:11-cr-00159-RHW Document 224 Filed 07/09/14

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(22 counts) and International Money Laundering (17 counts) for alleged
violations occuring during the operation of a payday short-term loan
business. ECF # 139. Jury trial was ultimately set for April 7, 2014. ECF #
157. On March 28, 2014, this Court heard the Defendants motion for
appointment of new counsel. ECF # 188.
One week later the Defendant pled straight up that is, pled to all
110counts without a plea agreement. ECF # 190, 191. The Courts colloquy
included the following exchange regarding the factual basis for a plea to all
110 counts:
THE COURT: And there were there were statements that
the payments to the investors would be made from the profits of
the business and, in fact, that wasnt true; that the many of the
payments that were made to investors came from other investor
funds. Is that correct?
THE DEFENDANT: Yes.
Transcript of Change of Plea, April 3, 2014, at page 14:7-12. At a
later point, the Defendant acknowledged that she sent out emails . . .
that would make people think that the company was better off than it
was Transcript, April 3, 2014, at 25:3-5.

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The Defendant acknowledged that she was exposed to the risk of a
maximum sentence of 20 years for each count, for a total of 2,200
years. Transcript, April 3, at 14:21-25. The Defendant again
acknowledged that she was pleading guilty to every one of the 110
counts. Transcript, April 3, at 22:20-21. The Defendant pled
separately to the four distinct offense groups (wire fraud, mail fraud,
money laundering and criminal forfeiture). Transcript, April 3, at 23-
24. Ultimately the Court posed questions to the Defendant to complete
the record of her plea:
THE COURT: Well, did you tell people, when you were
soliciting funds, that the business was doing well and they would be
paid back when, in fact, it wasnt?
THE DEFENDANT: Yes, your Honor.
THE COURT: And did you tell them that the funds that they
were investing were going to be used to make loans. And in fact, the
money was not used for that but was used to pay other investors?
THE COURT: And did you tell them that the amounts they
could expect to be paid were, you know, from 40 to 75 percent a year

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knowing that you would never be able to do that out of the profits of
the business?
Transcript, April 3, at 25-26. Counsel for the Defendant agreed that
there was sufficient evidence, if believed by the jury, to find your
client guilty beyond a reasonable doubt. Transcript, April 3, at 27.
Additional facts will be provided via proffer and declarations, and with
the Courts permission, via live testimony on July 11, 2014. See Declaration
of Counsel with attachments from the Defendant and attorneys Bugbee,
Ryan, and Lysiak as well as a proffer regarding testimony from Father Hays.
STANDARD FOR WITHDRAWAL
The Ninth Circuit has a well-developed set of standards governing the
trial courts authority over a defendants motion to withdraw a guilty plea
prior to sentencing.
By Rule, withdrawal of a plea before sentencing may be granted, at the
trial courts discretion, upon a showing by the defendant of a fair and just
reason. Fed. R. Crim. Pro. 11(d)(2)(B).
The Ninth Circuit has held that fair and just reasons for withdrawal
include inadequate plea colloquies, newly discovered evidence, intervening

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circumstances, or any other reason for withdrawing the plea that did not
exist when the defendant entered his plea. United States v. Ortega-Ascanio,
376 F.3d 879, 883 (9
th
Cir. 2004). The burden is upon the defendant to
demonstrat[e] the existence of at least one of these conditions. United
States v. Showalter, 569 F.3d 1150, 1154 (9
th
Cir. 2009).
It is imperative to distinguish this standard from the more familiar
standards with similar language. For example, to obtain a new trial the
defendant can posit newly discovered evidence, but to obtain a new trial
the evidence must reach a level to support the conclusion that had the facts
been known at the time of trial it would have changed the verdict or
sentence[,] United States v. George, 420 F.3d 991, 1000 (9th Cir.2005) or
would probably result in an acquittal[,] United States v. Sitton, 968 F.2d
947, 959-60 (9
th
Cir. 1992)). In United States v. Showalter, 569 F.3d 1150,
1157 (9
th
Cir. 2009), the court noted the stark difference between the new
trial standard of Rule 33 and a motion to withdraw a plea of guilty.
Defendant Nelson is not seeking to obtain a new trial and that standards test
for the effect of newly discovered evidence does not apply.
Nor should the standard for withdrawal under Rule 11(d)(2) be confused
with the standard required for reversal of a verdict for ineffective assistance

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of counsel. The Strickland standard is highly deferential to the focussed
issue of counsels deficient performance. See Harrington v. Richter, 131
S.Ct. 770, 788 (2011) (Even under de novo review, the standard for judging
counsel's representation is a most deferential one.) Furthermore, under the
Strickland test, alleged errors must amount to incompetence under
prevailing professional norms[.] Strickland v. Washington, 466 U.S. 668
at 690 (1984).
Withdrawal of a plea under Rule 11, however, does not require that the
new evidence demonstrate a likelihood of acquittal; nor does it require any
error by counsel.
Because there is no extant judgment, the demands of finality are much
reduced. In stark contrast to motions for new trial or claims of ineffective
assistance, a motion for withdrawal made before sentencing is judged
against a standard that is intended to be generous and applied liberally. See
United States v. Bonilla, 637 F.3d 980, 983 (9
th
Cir. 2011).
PERMITTED CONSIDERATIONS
The trial court is permitted to consider a defendants claim of legal
innocence, which is an important but not controlling factor. Compare United
States v. Castello, 724 F.2d 813, 815 (9
th
Cir. 1984) (court may accept

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statements at plea colloquy over later claims of innocence) with United
States v. McTiernan, 546 F.3d 1160, 1167 (9
th
Cir. 2008) (defendants
assertion of innocence is an important factor to be weighed, along with
reasons defenses were waived and the time between the change of plea and
the motion for withdrawal). Even absent a claim of innocence, a defendant
may withdraw his or her plea for a fair and just reason. United States v.
Garcia, 401 F.3d 1008, 1012 (9
th
Cir. 2005).
[F]inding that a defendant's failure to claim innocence weighs
against his motion to withdraw runs contrary to the language of
the fair and just reason standard. The standard asks whether
the defendant has presented a fair and just reason for
withdrawal, not whether the original plea was likely erroneous.
Id.
Although short of the Strickland standard, legally wrong or inadequate
legal advice may also constitute a fair and just reason for plea withdrawal,
even without a showing of prejudice, when the motion to withdraw is made
presentence. McTiernan, 546 F.3d at 1167.
Indeed, there need be no error whatsoever. See United States v. Ortega-
Ascanio, 376 F.3d 879, 884 (9
th
Cir. 2004) (no requirement that movant

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show the plea was invalid); see also, United States v. Garcia, 401 F.3d 1008,
1011 (9
th
Cir. 2005). In Garcia, the circuit held that a patently knowing,
voluntary and intelligent plea does not count against a defendants attempt to
withdraw prior to sentencing (absent a claim of involuntariness itself). The
standard for a fair and just reason to permit withdrawal is simply more
generous than the standard for determining whether a plea is invalid. Id.
To establish sufficient prejudice, movant need only show a plausible
basis to argue that the plea would not have been entered. For example, if
counsels advice is erroneous, the defendant does not have to prove that he
would have pleaded guilty but for the erroneous advice. United States v.
Davis, 428 F.3d 802, 807 (9
th
Cir. 2005). A fair and just reason for plea
withdrawal can be established from errors or misunderstandings that
plausibly could have motivated [defendants] decision to plead guilty. Id.,
at 808 (emphasis in original).
WITHDRAWAL STANDARDS APPLIED
TO THIS DEFENDANT

In this instance, the Defendant seeks to withdraw from a straight plea. It
is not argued that defense counsel violated the Strickland standards. There is
insufficient time and resources to examine the record to form any opinion as
to ineffective assistance.

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There is little doubt that the plea colloquy and plea procedures are valid
on their face.
The Defendant has, however, shown a number of points on which it is
plausible that given information learned after April 3, and the
circumstances as they developed after April 3, she would not have plead
guilty to each and every one of the 110 counts.
For example:
Assistance from Attorney Lysiak. Prior to April 3, Ms. Nelson did not
have the assistance of Mr. Lysiak who had considerable inside information.
Mr. Lysiaks declaration sets forth his earlier involvement with the defense,
which involvement was terminated due to litigation against him.
Hard Drive. Ms. Nelson did not have ready access to her companys
hard drive during the months leading up to trial. While both her counsel
stated at the April 3 plea colloquy that they were ready to try the case that
coming Monday (Transcript at 27), in fact they had not prepared with Ms.
Nelson using any of the exhibits or information from her hard drive business
records.
Ability to Retain Counsel. Ms. Nelsons motion to remove her
appointed counsel was denied just 7 days before she agreed with Mr. Ryan

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and Bugbee to plead to all 110 counts. Following that denial she met with
personal advisors (including Father Hays) and spoke with several counsel in
Eastern Washington (Oreskovich, Prothero and others) and learned she was
entitled to hire counsel provided that she could raise funds apart from the
assets seized by the United States or in any way involved with the alleged
crimes. For the first time, on or about June 21
st
, she spoke with new counsel
who agreed to review the case based on existence of unencumbered assets
from third parties.
Plea Colloquy. A review of the plea colloquy demonstrates another
problem. While not arising to the level of error sufficient to cast the plea as
invalid, the fact colloquy contains a less-than-clear acknowledgement as to
guilt on every count. It is conceded that the Defendant stated she was guilty
as to every count, but in the prior colloquy she admits to illegal conduct in a
generic open-ended fashion. Asked if many payments to investors were
made from other investor money, she said yes. But she did not plead to
many counts, she pled to them all. Did she make untrue statements to
investors? Yes. But, again, she did not indicate that untrue statements were
given in every one of the fraud counts.

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The problem did not become apparent until Ms. Nelson began to work
with her counsel on the sentencing phase. At this point, according to her
declaration, her counsel was unwilling to put forth defenses as she had
been told prior to sentencing to specific counts. Mr. Ryan, in good faith
working with the Defendant on sentencing arguments, appeared to the
Defendant to be at a loss how he could proceed as he had promised.
DATED this 9th day of July, 2014.

LAW OFFICE of JEFFRY K. FINER

____/s Jeffry K. Finer____________
Jeffry K. Finer
WSBA No. 14610


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