Judge Monti Belot did, however, deny acquittal on her convictions on filing false statements on tax returns.

A federal judge on Wednesday granted acquittal for Anita Guidry on 10 charges a jury deadlocked on earlier this week.
In the ruling, Judge Monti Belot refused to acquit her on the three charges of filing false statements on tax returns that she was convicted of.
The ruling essentially means that Guidry, 50, cannot be retired on the 10 bank fraud and money laundering charges. The jury deadlocked on those charges on Monday after about eight hours of deliberations.
“It’s what I expected based on the law,” said Guidry’s attorney, Dan Monnat. “It’s an absolutely correct legal decision on the money laundering and bank fraud counts.”
Assistant U.S. Attorney Deb Barnett, the prosecutor, did not return a call seeking comment.
The charges against Guidry stem from the allegation that she embezzled $2.7 million between 1992 and 1997 from Wichita Sheet Metal Inc. while working as the company’s controller.
Prosecutors said she spent more than $1 million of the money on clothes.
Monnat said during his closing argument on Friday that Guidry was wrong to take the money, but her actions were not bank fraud, and if she was not convicted of bank fraud, she could not be convicted of money laundering.
However, Assistant U.S. Attorney Deb Barnett said Guidry did defraud the bank when she wrote herself 289 company checks and pretended the money was being used to pay the company’s federal income taxes.
For Guidry to be convicted of bank fraud, prosecutors had to prove that the banks she took money from lost money, were put at risk of potential monetary loss or were put at risk of civil liability.
“At trial, witnesses from the bank testified that the bank suffered no loss,” the ruling stated. “The government produced no contrary evidence. Additionally, there was no evidence the bank could have suffered a loss.” And during the trial, the president of Wichita Sheet Metal testified that she had not yet sued the bank but was considering it.
As for the money laundering charges, the ruling stated: “Because bank fraud is a necessary predicate to the money laundering charges, the court must grant acquittal on those counts as well.”
The charges of filing false statements on tax returns stem from Guidry’s failure to report the income to the IRS while filling out her family’s income tax forms, prosecutors said.
Monnat had said Guidry was unaware she had a duty to report the money on her tax returns.
But the ruling stated that Guidry – an accounting major – was aware the income needed to be reported.
No sentencing date has been set on the tax convictions.

By Joe Rodrigues

Grand jury refuses to charge local sellers of Jock Sturges’ photo book of nude children

A grand jury has declined to indict local bookstores for selling Jock Sturges’ photography books of nude children in provocative poses.
The decision disappointed members of the Kansas Family Research Institute, a Christian group that had spent two years protesting the books as a form of child abuse. The institute had collected enough signatures on petitions to require that a grand jury be convened.
The 15 grand jurors reached their conclusion last week in a closed proceeding. Their decision was made public Friday.
The institute or anyone else may collect enough signatures to impanel another grand jury, but, for now, the decision closes the case.
Kathryn Gardner, an attorney on the institute’s advisory board, said the decision won’t stop the group from educating the public about its concerns with the book, or from lobbying the state Legislature.
“Just getting a grand jury convened and getting enough signatures is a pretty good reflection of the community’s standards that they don’t like this,” Gardner said.
Members of the group launched the petition drive after District Attorney Nola Foulston decided not to prosecute. They had first complained to her in April 1996.
The issue for group members is not whether pornography is art. They perceive the black-and-white photos of nude children, some with their genitals exposed, as child abuse and had hoped Sedgwick County would join grand juries in Tennessee and Alabama that handed down indictments.
Sturges, in a statement issued Friday though his Wichita attorney, Dan Monnat, thanked the grand jury for its “high-minded insistence upon freedom of expression and refusal to become involved in a modern-day witch hunt.”
He said his purpose is humanistic, and he does not take or publish children’s pictures without their parents’ consent.
Foulston said Friday that the nudity in Sturges’ photographs is not a prosecutable offense.
“The U.S. Supreme Court has said mere nudity alone is not enough to constitute exploitation of a child and the photographs in this case were of nude people only,” she said.
“We regularly prosecute people who exhibit phots of children who are naked when those photos are exploitive under the law by showing acts of intercourse, so it is not as if this office does not prosecute those cases.”
She said the grand jury’s conclusion validates her office’s decision not to file charges.
The grand jury needed eight hours over two days to hear the evidence and reach a decision. State law prevents anyone involved in the case from discussing how the jurors voted and what evidence was presented. To issue an indictment, at least 12 jurors would have had to agree.
Jack Focht, a former assistant district attorney who has prosecuted obscenity cases, served as special prosecutor for the proceedings. Foulston hired him instead of handling the case herself to avoid charges of bias because she has said publicly that Kansas law does not apply to Sturges’ books. It was not known Friday how much the case cost taxpayers.
State Rep. Tony Powell, R-Wichita, who supported the institute’s protest against Sturges’ books, questioned whether Foulston deliberately chose an attorney sympathetic to her viewpoint.
“Jack Focht is a good guy, an excellent lawyer, but he was not someone the institute would have chosen for this case,” said Powell, an attorney. “I would not be surprised if he just showed the book and explained the law. And that’s not enough to fairly judge the case.”
The grand jury’s decision sets it apart from the grand jury actions in Alabama and Tennessee.
The Alabama indictment involves 17 counts over the sale of one of Sturges’ books. If Barnes & Noble is convicted, the company could be fined up to $10,000 on each count. As of Friday, no court date had been set in the case.
The Tennessee grand jury found that Barnes & Noble did not display the book out of the line of sight of children, as required by local law. A hearing will be held May 18.
Last fall, Wichitans protested the sale of the book at Borders Books & Music and Barnes & Noble Booksellers. The book is now sold out in Wichita.

By Lori Lessner

Kansas judge questions ethics of reporting names of some cash-paying clients
In a war between the Internal Revenue Service and the criminal defense bar over a requirement that lawyers report the names of some cash-paying clients, the lawyers finally have a weapon to use.
It is a Jan. 13 opinion by U.S. District Judge Patrick Kelly, the chief judge of the Kansas district. In it he questions whether lawyers should be forced to tell the IRS on its Form 8300 the names of clients who pay more than $10,000 cash.
Calling the client-attorney relationship “a sacred trust” not to be lifted by the government at a whim, Kelly temporarily suspended IRS action against the Wichita lawyer Daniel Monnat. United State v. Monnat, No. 93-1326-PFK.
Lawyer Sees Victory
Monnat, 42, president of the Kansas Association of Criminal Defense Lawyers, called Kelly’s decision “a huge victory that lawyers in my position can use” against the IRS.
“I think federal law enforcement is using 8300 forms as part of a concerted effort to prevent criminal defendants, especially those in drug cases, from hiring a good lawyer,” Monnat said. “It’s had a definite chilling effect.”
Until Monnat, the IRS was winning its cases against lawyers who filed the form but failed to report client names. Many criminal defense lawyers had resisted the IRS mandate, citing client-attorney privilege and the client’s Sixth Amendment right to counsel.
Instead of ruling on the case, Kelly referred the attorney-client privilege issue to the Federal Court Committee on Attorney Conduct, a body created by the Kansas federal judges to examine ethical questions that confront judges and lawyers. He gave it 120 days to report back.
“It is clear to this court,” Kelly wrote, “that if and when a client consults with an attorney, retaining him for whatever purpose, the canons mandate that the client’s very identity must be preserved.”
Two federal appeals courts that also considered the issue ruled that attorney-client privilege does not excuse the lawyer from revealing a client’s name. United States v. Laventhal, 961 F.2d 936 (11th Cir. 1992), and United States v. Goldberger, 935 F.2d 501 (2nd Cir. 1991).
Relying on those two cases, federal courts have rejected defense lawyers’ pleas for relief from IRS Code 60501, enacted in 1984.
Kelly wrote that he was “troubled” by those decisions. He said their reasoning flies in the face of the attorney’s role, “The attorney is not expected to confer with a client as in a commercial venture,” he wrote. “It is a relationship different from any other in our society, save for the confessor or physician. In the court’s view, it is a sacred trust and should not be intruded in.”
At about the same time Kelly wrote about his doubts, the IRS hit about a dozen lawyers across the country, most of them high-profile, with fines ranging from $25,000 to $100,000 for repeated failures to report clients’ name on Form 8300.
Unpleasant Mail
IRS officials confirmed that several fines had been mailed, but would not give the names of attorneys who were targeted.
One lawyer who revealed he was asked to pay a fine is Don Samuel of Atlanta. The criminal defense lawyer received the IRS notice the same day Kelly issued his ruling. It said he was being fined $100,000 and that he would have to pay that amount before appealing it.
The agency is “trying to make us informants against our own clients,” Samuel said. “The IRS is punishing us for being good lawyers, for vigorously defending our clients, and for following the ethical guidelines mandated by our state bar.”
Samuel was referring to a 1985 ethics opinion by the State Bar of Georgia telling lawyers to withhold the names of a client on the 8300 forms until a federal judge orders it and all appeals are exhausted.
Ten other states and the District of Columbia have issued similar opinions. (They are Alabama, Arizona, Florida, Kentucky, New Mexico, New York, Ohio, Pennsylvania, Washington and Wisconsin.)
Samuel had a similar fight with the IRS in 1992 over his failure to name two clients who paid large sums of cash. The IRS sued and won.
Besides the ethical and constitutional problems posed by the IRS actions, they also raise the issue whether the tax agency is targeting the wrong lawyers, said Gerald Lefcourt, the vice president of the National Association of Criminal Defense Lawyers.
“They are punishing the ethical lawyers, the lawyers who actually report to the IRS that they have received large amounts of cash and are paying taxes on it,” Lefcourt said. “The IRS should be going after the unethical lawyers, the lawyers who accept the large amounts of cash, but don’t report it.”
Randolph Stone, the chair of the ABA Criminal Justice Section and a University of Chicago law professor, said there was “hope that the Department of Justice under Bill Clinton would be much more understanding and modify these policies.”
“It has been very disappointing that this has not happened,” he said.

by Mark Curriden
ABA Journal March 1994

After dark on May 17, Wichita narcotics officers stood on the porch at 144 S. Chautauqua and yelled, “Police officers with a search warrant.”
A second or two later, the officers used a battering ram to smash through a locked door at the home of Steven Holland Gerber, 40. They seized 106 marijuana plants growing in the basement, several pounds of processed marijuana and a small amount of cocaine.
But a federal judge has ruled that none of the evidence can be used in court because police didn’t give Gerber enough time to open up. Evidence showed the suspect was headed for the door.
U.S. District Judge Sam Crow said in his ruling that a delay of only a second or two before forcibly entering the house was “unreasonable conduct by the police officers … and amounts to a violation of the defendant’s Fourth Amendment right to be free from unreasonable searches and seizures.”
The ruling came after Gerber’s attorney asked that the evidence be suppressed on grounds of an illegal search and seizure. The case, still pending, never has been tried because Crow suppressed the evidence.
U.S. Attorney Ben Burgess had no comment on the ruling and said he had not decided whether to appeal. He has until the end of October to decide.

Wichita Police Lt. Mike McKenna, public information officer, said he couldn’t comment on pending litigation.
In general, McKenna said, the supervising officer on a drug bust decides whether to break down a door. After officers knock and identify themselves, the time lapse before breaking in depends on the case, he said. Officers usually make a quick entry, he said, if they think the defendant could be armed and dangerous or could try to destroy the evidence.
“At this time, I don’t feel that there is a need for change in the police policy,” McKenna said.
In Gerber’s case, police provided no evidence that they knew the defendant had weapons or that he would try to destroy evidence, Crow said in his ruling.
Dan Monnat, who represents Gerber, called the decision wise.
“It protects both the citizen and the police,” he said. If people don’t have time to answer the door, he said, they might try to defend themselves against what they think is a break-in.
Also, Monnat said, “Just because you have a search warrant, that doesn’t give you a license to unnecessarily destroy property.”
Otto Privette, Drug Enforcement Administration spokesman in Wichita, said he was disappointed by the ruling – the first of its kind that he can recall in his 19 years in the business. The DEA was not involved in the case.
DEA agents knock and announce their presence and give the defendant a “reasonable amount of time” to answer the door before forcing entry, Privette said. The amount of time depends on the situation, he said.

By Jennifer Benjamin