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Case 1:15-cr-00034-RJJ ECF No. 39 filed 11/05/15 Page 1 of 5 PageID.






Case No. 1:15cr34



This matter is before the Court on Defendant's Motion for Leave to Substitute Counsel.
In particular, defendant wants to substitute retained counsel in place of court-appointed
counsel. The rub is that defendant cannot afford on his own to pay for counsel, but has raised
the funds by soliciting his friends. At least some of those friends are the very people that the
government claims are victims of the fraud alleged in the Indictment. Does this create a
substantial enough risk of a conflict of interest for prospective retained counsel, or any other
distortion of the trial process so that the Court should deny substitution and require defendant
to continue with appointed counsel? Defendant says "no." The government ultimately takes no
position, but notes "there are reasons for the Court to be concerned about conflicts of interest .
. . [that] may lead the Court to use its discretion to deny the request." PageID.85.
Substitution of counsel for a criminal defendant is subject to an overall standard of good
cause. Benitez v. United States, 521 F.3d 625, 632 (6th Cir. 2008). The Sixth Amendment
guarantees that an accused who desires to and is financially able should be afforded a fair
opportunity to secure counsel of his own choice. Wilson v. Mintzes, 761 F.2d 275, 278 (6th
Cir. 1985) (quoting Powell v. Alabama, 287 U.S. 45, 53 (1932)). The Sixth Amendment right to
counsel of ones choice is not absolute, however; it is a qualified right. Id. at 280. [I]n

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evaluating Sixth Amendment claims, the appropriate inquiry focuses on the adversarial process,
not on the accuseds relationship with his lawyer as such. United States v. Wheat, 486 U.S.
153, 159 (1988) (internal quotation marks omitted). Among other limitations, a defendants
right to counsel does not include an absolute right to delay proceedings or to be represented by
counsel with a conflict of interest. See id.; Wilson, 761 F.2d at 280. In evaluating potential
conflicts, a court must balance[] two Sixth Amendment rights: (1) the qualified right to be
represented by counsel of ones choice, and (2) the right to a defense conducted by an attorney
who is free of conflicts of interest. Wheat v. United States, 486 U.S. 153, 157 (1988). Where
a trial court knows or reasonably should know that a particular conflict exists, the court should
initiate an inquiry into the conflict and take adequate steps to guarantee the effective and
conflict-free assistance of counsel. See id. at 159-60; Boykin v. Webb, 541 F.3d 638, 644 (6th
Cir. 2008).
Potential conflicts of interest include third-party fee arrangements. Under the Western
Districts Local Rules, all attorneys practicing before this Court must abide by the Rules of
Professional Conduct adopted by the Michigan Supreme Court. L. Crim. R. 57.1(j). Under the
Michigan Rules, a lawyer shall not represent a client if the representation of that client may be
materially limited by the lawyers responsibilities to another client or to a third person unless
the lawyer reasonably believes the representation will not be adversely affected and the client
consults after consultation. Mich. R. Prof. Resp. 1.7(b). The Rules limit an attorneys ability to
accept third-party payments for legal services. A lawyer shall not accept compensation for
representing a client from one other than the client unless: (1) the client consents after
consultation; (2) there is no interference with the lawyers independence of professional
judgment or with the client-lawyer relationship; and (3) information relating to representation of
a client is protected . . . . Mich. R. Prof. Resp. 1.8(f). Third-party payments must be disclosed

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and may not pose a conflict of interest. Id. cmt. A court should inquire into third-party
payments in the same way and under the same circumstances that it would a conflict of
interest. See id. cmt.
The Court has explored these considerations thoroughly with the parties, both in open
court, and on a separate ex parte record with just the defense. The Court has also invited and
received briefing from the parties. The Court is satisfied that there is good cause for the
substitution; that the risk of conflict--though real--is not disqualifying; and that the risk of other
distortion of the trial process can be managed through full disclosure of funding solicitations and
sources, which defendant has agreed to provide. The defendant has been fully apprised of his
rights and the risks, and has unequivocally recited his desire to proceed with prospective
retained counsel, and his willingness to provide full disclosure to the government of his
solicitations for funds, and the source of all funds provided for his defense.
First, the Court is satisfied there is good cause for a substitution. Both defendant and
his currently appointed counsel have described growing tension in their relationship. It is
obvious they do not agree on how best to defend the case. This is not automatically a basis for
substitution of counsel, but in this case there is well-qualified prospective retained counsel
without that problem that is ready and willing to step in and handle the case with only a modest
time extension. Moreover, the Court notes that at least one of the reasons contributing to the
difficulty defendant has had in financing retained counsel earlier is an asset freeze order
entered against defendant in the civil fraud action brought by the CFTC. When a civil lawsuit
filed by one agency of the federal government potentially impairs the ability of a criminal
defendant to retain counsel of his choice, the Court feels obliged to exercise its discretion in a
way that exhausts all reasonably available avenues that allow defendant to retain his chosen

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Second, defendant has unequivocally chosen to run the risks involved, and the Court
sees no structural conflict that is beyond waiver. Prospective defense counsel does not
represent anyone but defendant in this matter. Nor has he previously represented anyone
other defendant on this or a related matter. The potential concerns about the confidences and
secrets of his client in connection with funding sources have been discussed and waived . So
what fundamentally remains is the risk that defense counsel may ultimately be tempted to pull
punches in shifting blame to donor witnesses. For example, defense counsel may want to
avoid questions suggesting that the donor witnesses themselves engaged in reckless or even
potentially criminal wrongdoing. And counsel may be tempted to avoid suggesting that his
client pursue a potential bargain with the government that would require the defendant to
disclose information about donors that could prove embarrassing or worse for the donors. But
these are tactical, not structural risks, and Defendant can--and has--appropriately waived them
after full disclosure.
Third, the Court is satisfied that any potential risk of unfair distortion in the trial process
is manageable with full disclosure of donor solicitations and funding sources. Donor witnesses,
whether called by the government or the defense, will be subject to full questioning on their
relationship to the defendant, including any solicitations from the defendant for donations, and
any decisions the donors made in response. That will allow the jury to evaluate how, if at all,
this affects the credibility of the donor witnesses. Similarly, in normal preparation for trial, both
sides will have available the information on solicitations and donations, and be able to take that
into account in assessing whether, when and how to approach, question and prepare
prospective witnesses. Moreover, because neither the government nor prospective defense
counsel actually represents the donors, any information either side receives from the donors in
preparation for trial will not be shielded from disclosure to the other side by the attorney-client

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Finally, the Court recognizes that this substitution will require some additional delay in
the trial schedule so that newly retained defense counsel can get up to speed. Both sides have
accepted that. The delay will not be long compared to the time the process has already taken,
and the Court is comfortable that the ends of justice are served by the modest additional delay.
Accordingly, Defendant's Motion for substitution is GRANTED. Defendant's appointed
counsel, Mr. Stroba, is relieved of further responsibility as counsel. Retained counsel, Mr.
Markou, is substituted as counsel for defendant. Defendant has already provided disclosure to
the government of solicitations and donations to the defense fund to date, and defendant shall
provide ongoing disclosure of any additional solicitations as they occur, and donations as they
are promised and as they are actually made. The Court will schedule a final pretrial conference
and trial by separate order.

/s/Robert J. Jonker
Robert J. Jonker
Chief United States District Judge
Dated: November 5, 2015