Monday, July 23, 2012

Objection Filed: Prosecution Outlines Factual Claims in U.S. v. Khouli et al.

Assistant United States Attorneys Karin Orenstein and Claire Kedeshian have filed an 87 page objection in response to motions filed on April 30, 2012 by Joseph Lewis, II and Salem Alshdaifat.  The government objects to the defendants' efforts to scuttle the case of United States v. Khouli et al., and the prosecutors take the opportunity to present the court with their evidence.

Lewis and Alshdaifat were charged by a federal grand jury in 2011 with crimes related to antiquities trafficking.  They are presumed innocent unless the government proves beyond a reasonable doubt that they had knowledge of the illegality and acted unlawfully. Another defendant in the case, Mousa Khouli, pleaded guilty to charges in April, while a fourth alleged conspirator, Ayman Ramadan, remains a fugitive at large.

In its objection filed with the U.S. District Court for the Eastern District of New York, the government argues, in part, that
  • the warrants authorizing searches of Lewis' home in Virginia and Alshdaifat's home in Michigan and their execution by federal agents were proper;
  • the search of the two defendants' emails were reasonable and properly authorized by three valid warrants;
  • Alshdaifat did not suffer violations of his right to remain silent or his right to counsel;
  • the smuggling statute (18 USC 545) is not unconstitutionally vague;
  • the government did not engage in any alleged overreaching or misconduct in the case;
  • the venue of the court (eastern district of New York) is proper; and
  • the money laundering conspiracy charge is valid.
Source: ICE
To support its legal arguments, and to paint a picture of the alleged smuggling and money laundering conspiracy, the government presents the court with a narrative describing the movements of an allegedly smuggled Greco-Roman coffin, a mummy board, a 3-piece nesting Egyptian coffin set, and Egyptian boats and limestone artifacts.

Federal prosecutors outline how Khouli and Ramadan smuggled the Greco-Roman coffin into JFK Airport in New York by transferring two payments of $10,000 and $3400 and submitting false customs information.  "While Lewis and Alshdaifat are not charged with smuggling the Greco-Roman coffin . . . the facts surrounding this transaction are revealing with regard to Lewis’s mens rea [i.e. criminal knowledge] for his subsequent transactions with Khouli," write the attorneys. The attorneys highlight that the customs papers listed the Greco-Roman coffin's country of origin as United Arab Emirates and not Egypt and described the coffin as "antique wood panel" valued at $3400. Prosecutors also tell how a sales invoice that did not originate from the actual seller, who was Ayman Ramadan/Nefertiti Eastern Sculptures Trading, was attached to the customs papers.

The government's lawyers go on to describe that the first artifact purchased by Lewis from Khouli was a mummy board, eventually seized by federal agents during a July 13, 2011 search of Lewis' Virginia home:

"Khouli sold an Egyptian mummy board to a customer .... A mummy board is a decorated wooden board that fits inside a coffin along with a mummy. On January 9, 2009, before [the customer] took physical possession of the mummy board from Khouli, Lewis purchased it from [the customer] for $60,000.  The bill of sale between Lewis and [the customer] included a photograph of the mummy board and identified its prior owners as Khouli’s company, Windsor Antiquities (“Windsor”), and previously, a private Dutch collection that acquired the item in the 1960s. The mummy board depicted in the bill of sale appears to have a transverse cut across the middle. On January 14, 2009, several days after the sale, Khouli and Lewis were in direct e-mail contact about shipping the mummy board from Khouli to Lewis.

"On February 10, 2009, Khouli advised Lewis by e-mail that he had obtained the mummy board from a restorer and offered to ship it to Lewis. Lewis inquired as to whether the repair at the 'joints' was invisible, referring to where the cut pieces were joined together."

On the same day, February 10, 2009, an Immigration and Customs Enforcement Agent (ICE) agent questioned Khouli about the importation of the Greco-Roman coffin.  The government reports that "[o]n the following day, February 11, 2009, Khouli offered Lewis two Egyptian antiquities: the Greco-Roman coffin and a bronze figure. Khouli advised Lewis by e-mail, 'Let me know what you think about the two Egyptian pieces[;] these are from my dad[’]s collection[;] he passed away about three years ago and my brothers and I want to sell them and split the money.'"  Lewis reportedly purchased the coffin for $32,500, not $65,000 as proposed by Khouli.

Because "[n]o mention was made of any other objects remaining from Khouli’s father’s collection [and because] Lewis’s dealings with Khouli the previous month indicated that Khouli had ... acquired the mummy board from a private Dutch collection, not from his father," federal prosecutors argue that "[t]hese facts belie Lewis’s argument that he had a basis for believing that every item he purchased from Khouli came from Khouli’s father’s collection."

In fact, government attorneys suggest that Khouli signaled to Lewis that the Greco-Roman coffin did not actually come from his father, stating:

"On March 6, 2009, after Khouli and Lewis had agreed to the sale of the Greco-Roman coffin, but months before Lewis took possession of it, Khouli offered Lewis a mummy linen and mask, writing in an e-mail, 'I just got th[e]s[e] items[;] i described them to you last week . . . .' (Gov’t Exh. 1; emphasis added). On the same date, Lewis responded, in sum and substance, that he already had four such items and that they were not very expensive. Khouli replied on the same date, 'It is very interesting[;] it was inside the coffin you bought from me according to the owner but he sold I[t] to me separately son of a gun.' (Id.; emphasis added). The statement that the Greco-Roman coffin had belonged to a separate 'owner' who 'sold' both the coffin and a related mummy linen and mask to Khouli was inconsistent with Khouli’s earlier representation that the Greco-Roman coffin had been sitting in his father’s collection for decades.  Upon learning this information, Lewis did not cancel the Greco-Roman transaction or request a new provenance from Khouli. Rather, he agreed to purchase the mummy linen and mask. In addition, despite Lewis’s only information about the mummy linen and mask’s provenance being that Khouli had 'just' received them and they were 'sold' to Khouli by another dealer, Lewis’s records for these antiquities include a Windsor bill of sale stating that these items were 'legally acquired by the late Jack Khouli in Israel in the 1960s.' While Lewis is not charged with smuggling the Greco-Roman coffin, his experience with Khouli in early 2009 told him that (1) not every Egyptian antiquity Khouli sold was from his father’s collection, and (2) any provenance that included Khouli’s father was unreliable."

The next day, on March 7, 2009, Khouli offered Lewis both a middle and outer coffin of an ancient Egyptian nesting coffin set, according to the prosecution.  Khouli reportedly went to Dubai in April to view them and discovered a third inner coffin.  Prosecutors say that  "Lewis’s e-mail messages indicate that he believed that the inner coffin was part of the same set as the middle coffin and outer coffin lid, making a three-piece nesting set. In these email messages, Khouli advised Lewis that the inner coffin had already been sold to another buyer and Lewis agreed to pay $150,000 for the inner coffin to avoid breaking up the set. The total agreed price for the nesting set was $310,000. Nothing in these e-mail exchanges suggested that Khouli had previously been aware of any of these coffins let alone that they had ever been in his father’s collection."

The government's lawyers add:
"On April 12, 2009, Lewis sent an e-mail message to Khouli confirming the details of the sale of the three piece coffin set. Lewis’s terms included that Khouli would provide “[p]rovenance from [his] late father’s collection, Israel 1960s” and a guarantee that the items would be cleared by Customs within 30 days of arrival. Khouli agreed to these terms. (Gov’t Exh. 4)."

The nesting coffins were sent to the United States in pieces using different transportation methods--international mail, air cargo, and sea cargo--and sent through separate points of entry, specifically JFK Airport in New York and the Port of Newark in New Jersey.  Prosecutors write in their pleading that the shipments were variously described for Customs as wooden panels, Indian furniture, purchased by a Connecticut third-party, or valued at $900. The coffin set was delivered to a Connecticut address.

Prosecutors further allege that Lewis knew that the Egyptian coffin parts required assembly.  "Lewis was therefore aware that pieces of the inner coffin and the remaining parts of the coffin set were being shipped in pieces, over an extended time period, because there was some risk attached to their importation."  Federal attorneys describe how Khouli sent an email to Lewis on April 29, 2009: "“i (sic) got the first half of the cut inner coffin the second half is on the way, shall I send it to you or should I wait for the second half and have [a certain person] look at it and have it fixed?” (Gov’t Exh. 6; emphases added). Lewis responded, “[The certain person] needs to put them together, when will the other two coffins arrive?” (Id.; emphasis added)."

Then in May 2009, Alshdaifat allegedly sold Khouli two ancient Egyptian funerary boats and five limestone figures for $40,000, which made their way from Ramadan to Khouli by international mail and then to Lewis. Prosecutors say that Ramadan sent the shipping label, which described the package as "antiques," to both Alshdaifat and Khouli.

The defendants may file a reply to the government's objection.  Meanwhile, Khouli's sentencing hearing is scheduled for next month.

(c) 2012 Ricardo A. St. Hilaire, Attorney & Counselor at Law, PLLC