The Laptop, Receiving Stolen Property and the "Return-for-Reward" Defense

This post examines an opinion from the District of Columbia Court of Appeals: Lihlakha v. United States, 89 A.3d 479 (2014). I decided to do a post on this case because while it is not brand new, it addresses an issue that I, at least, had not run across before.

The court begins the opinion by explaining that following a

bench trial, appellant Jessica Lihlakha was convicted of misdemeanor receiving stolen property (RSP) and unlawful entry.  On appeal, Lihlakha challenges the sufficiency of the evidence to support her convictions.

Lihlakha v. United States, supra.

The opinion went on to summarize how the prosecution arose and how it progressed:

Lauren Banks testified that on August 13, 2011, she returned to her dorm room at Howard University and, upon entering, left her book bag in the hallway. During the minute or so that she left the bag unattended, her laptop inside it, a Macbook Pro, disappeared. After reporting what happened to campus police, Banks placed signs around her dorm building announcing a `missing Mac laptop,’ providing her phone number, and stating that the `[f]inder will be graciously compensated.’ The next evening, Banks received a phone call from a woman who asked Banks whether she was missing an HP laptop and what the reward would be for returning it. Banks answered that hers was not an HP but added that the reward was $1,000. The caller then told Banks that she had `just gotten this HP for the low,’ and that she would `keep an ear out and see if . . . your laptop comes up.’

The woman called Banks the next day to say that she had found two Macbook Pros with the name `Lauren’ on them after going to see `the guy she said she got the HP from.’ She told Banks she had found two Mac laptops `at the same place’ in `the room where the other computers were.’ The woman asked Banks for her full name to determine which of the Mac laptops belonged to her. Banks complied and learned that the caller apparently had her laptop. The caller then contacted Banks again to set up a meeting to exchange the money for the laptop that evening.

At that point, Banks contacted the Howard University police, who suggested that Banks either meet the caller herself or have a police officer go in Banks's place. Banks agreed to have an officer pose as Banks to meet the caller. Per police instructions, Banks told the caller that she needed another day for her parents to wire her the reward money, and she continued to communicate with the caller until they arranged a time and place to meet.

At the meeting on August 17, 2011, a police officer posing as Banks met the caller, and the officer thereupon recovered the laptop and brought Lihlakha to the police department for questioning. The police showed Banks a photo of the person who, an officer said, had delivered Banks's computer. (From the photo, Banks eventually identified that person in court as Lihlakha.) Not long thereafter, Banks heard knocking on her dorm room door. After looking through the peephole, she recognized Lihlakha (from the photo) as the person standing outside her door with a man who was trying to put a key into it that did not fit. The two then left, and Banks reported the incident to campus police.

Lihlakha v. United States, supra.

The Court of Appeals went on to summarize the testimony provided by the next three witnesses who testified at trial:

The next witness for the government was Investigator Elizabeth Neville, the police officer who met the caller while posing as Banks. Officer Neville testified that Lihlakha had approached her at the place where Banks and the caller had arranged to meet. Neville asked Lihlakha if she had the laptop and told Lihlakha to sit down next to her. Neville testified that she saw a laptop inside Lihlakha's bag and asked about it, whereupon Lihlakha pulled the laptop out of her bag, opened it, turned it on, and passed it to Neville. Immediately thereafter, other police officers arrived and took Lihlakha away.

The government also presented the testimony of Investigator Ronald Tarpley of the Howard University Police, who testified that he had questioned Lihlakha about how she obtained Banks's laptop. According to Tarpley, Lihlakha replied that a local drug dealer named `Kool–Aid’ had told her `he had a stolen laptop’ for which a reward had been offered, and that if `she returned [the laptop] she [could] keep 700 and give him 300 of the $1,000 reward.’

Finally for the government, Investigator William Brown of the Howard University Police testified that he had told Lihlakha on August 18, 2011, that she was prohibited from coming `on Howard University property.’ He added that he gave her a copy of the barring notice at that time, that he explained it to her, and that she refused to sign it.

Lihlakha v. United States, supra.

The court then reviewed the evidence presented by Lihlakha’s defense attorney:

Lihlakha testified that a man named Tony, whom she knew as `Kool–Aid,’ had shown her a `sign’ indicating that a reward was offered for the return of a missing computer. Lihlakha called the phone number on the sign, and the woman who answered told her that she had `left [the computer] out’ but did not indicate that it had been stolen. Lihlakha eventually obtained a computer from Tony that she believed belonged to the person with whom she had spoken over the phone. Lihlakha testified that she had wanted to return the computer to the rightful owner the same day, even if the owner did not yet have the reward money, but that the owner had asked Lihlakha to wait until the owner obtained the money from her parents. After arranging a time to meet with the owner, Lihlakha attempted to return the computer but instead met an undercover police officer who was posing as the owner, and `[t]hat's when the police came out.’ Lihlakha acknowledged that after her arrest, a dean ordered her not to go inside the East or West Towers at Howard University, where Banks resided. Lihlakha further testified that she had never visited Banks's dorm room inside the West Tower.

On cross-examination, Lihlakha testified that she had asked Tony, whom she was `dating loosely,’ for `some money.’ He had given her a `flyer’ offering a reward for the return of a missing laptop. He then told her that a `computer he received was what he thought was on the flyer’ and asked Lihlakha to call the number on the flyer and `find out about it.’ Lihlakha further testified that Tony did not tell her the laptop was stolen; he said that he had received it from a Howard University student in `exchange for something.’ Lihlakha added that she had asked no questions and had no further information. She also testified that Tony did not ask her to give him any portion of the reward money, that she did not call the police once she obtained the computer, and that she did not tell Tony to call the police.

Lihlakha v. United States, supra.

The Court of Appeals went on to explain that  the

trial court discredited Lihlakha's testimony, finding that it was inconsistent and appeared to be `fashioned on the fly.’ The judge then credited the testimony of Banks and Investigator Tarpley, finding Lihlakha guilty of RSP beyond a reasonable doubt. The judge discredited the portion of Investigator Brown's testimony that Lihlakha had been barred from coming onto any of Howard University's property. However, the judge found Lihlakha guilty of unlawful entry nonetheless based on `the terms of the barring notice’ given to Lihlakha and, inferentially, on Lihlakha's own testimony that a dean at Howard had made it clear to her `not to go to the [dormitory] towers at all.’

Lihlakha v. United States, supra.

The court began its analysis of Lihlakha’s arguments on appeal by explaining that

[a]t the time of trial, D.C. Code § 22-3232(a) (2001) provided:

A person commits the offense of receiving [1] stolen property if that person [2] buys, receives, possesses, or obtains control of stolen property, [3] knowing or having reason to believe that the property was stolen, [4] with the intent to deprive another of the right to the property or a benefit of the property.

The first two elements—that the property was stolen by someone and that Lihlakha received, possessed, or obtained control of the property in question—are uncontested. Moreover, Lihlakha admitted to Investigator Tarpley (contrary to her testimony at trial) that her supplier, Tony, i.e., `Kool–Aid,’ `had a stolen laptop’ which he would allow her to parlay into a $1,000 reward, reduced by $300 for Kool–Aid (at trial she denied any such rebate). Lihlakha has not contested receipt of this hearsay admission in evidence. Accordingly, the evidence is sufficient to satisfy the third element of RSP: knowledge or reason to believe that the property was stolen.

We are therefore left to determine whether the evidence is sufficient for a fourth-element finding that, at the time appellant acted in receiving the stolen property, she intended to deprive Banks of the right to her computer or a related benefit. Lihlakha does not renew on appeal the principal defense she presented at trial: the third-element defense that she did not know the laptop had been stolen. Rather, she now presents two arguments claiming innocent intent premised on the irrelevance of whether she knew that the laptop `was stolen or not.’

First, she contends that she and Banks had voluntarily entered into a valid unilateral `contract’ pursuant to which Lihlakha would receive an advertised reward in exchange for returning Banks's computer. In this connection, citing case law and the Model Penal Code, Lihlakha argues that she lacked the criminal mind essential to RSP because her only intent had been to seek possession for the purpose of returning the computer to its rightful owner, even though she did so in the expectation of obtaining the offered reward.

Alternatively, Lihlakha asserts a `consent’ defense, not dependent on contract theory, arguing that Banks had authorized Lihlakha to seek possession of Banks's computer by offering a reward for its return, fully contemplating that Lihlakha `would possess property that [Banks] had reported as stolen.’

Lihlakha v. United States, supra.

The section of the Model Penal Code Lihlakha relied in making the first argument outline above was § 223.6 (`Receiving Stolen Property' and it provides as follows:

1) Receiving. A person is guilty of theft if he purposely receives, retains, or disposes of movable property of another knowing that it has been stolen, or believing that it has probably been stolen, unless the property is received, retained, or disposed with purpose to restore it to the owner.`Receiving’ means acquiring possession, control or title, or lending on the security of the property.(2) Presumption of Knowledge. The requisite knowledge or belief is presumed in the case of a dealer who:(a) is found in possession or control of property stolen from two or more persons on separate occasions; or(b) has received stolen property in another transaction within the year preceding the transaction charged; or(c) being a dealer in property of the sort received, acquires it for a consideration which he knows is far below its reasonable value.`Dealer’ means a person in the business of buying or selling goods including a pawnbroker.

Next, the Court of Appeals explained that

[i]nitially, we must resolve whether counsel at trial adequately preserved the arguments that Lihlakha now presents on appeal. After a bench trial, in the absence of a motion for judgment of acquittal at the end of trial, the defendant's not guilty plea is enough in itself to preserve for appeal all challenges to sufficiency of the evidence, whether specified at trial or not.  There was no such acquittal motion here. Sufficiency of the evidence, of course, means sufficient for conviction of the charge, including sufficiency of a legally available defense. Before we embark on a sufficiency analysis, therefore, we must evaluate the legal validity of the two defenses, proffered on appeal, which Lihlakha contends the trial court erroneously failed to recognize: return-for-reward (unilateral contract) and consent.

Lihlakha v. United States, supra.

The Court of Appeals began with the “consent” defense, explaining that of

these two defenses, it is clear that Lihlakha did not claim `consent’ at trial. Our review of consent, therefore, is limited to plain error, and we are satisfied that the trial court did not plainly err in this respect. This jurisdiction has never recognized a consent defense in this context; indeed, to get there, counsel would have us convert for use in reward cases a standard instruction on alleged consent to sexual acts, otherwise criminal—an analogy we find wholly inapposite. Furthermore, any consent by Banks to Lihlakha's actions would not have been fully informed, given Lihlakha's failure to disclose her relationship with Tony (which might well have discouraged mutual dealing). Finally, any meaningful argument invoking consent is inherent in the elements of Lihlakha's return-for-reward (unilateral contract) defense, to which we now turn.

Lihlakha v. United States, supra.

The court then pointed out that

[w]ithout elaboration, counsel did suggest the return-for-reward defense at trial. In closing argument, while contending primarily that Lihlakha did not have reason to believe the computer was stolen, counsel also relied on what the government has called `the law of reward’ to nullify Lihlakha's “intent to deprive” Banks of her property or its benefit. Said counsel:

`I think that it is a situation where a young lady was trying to do what she thought was the right thing to try and return this computer[,] and also there was a motive out of it where she could try and get a few dollars as a result of her efforts.’

Trial counsel therefore articulated, albeit quite generally, the legal theory on which the RSP conviction here will ultimately turn—as formalized by counsel in Lihlakha's brief on appeal.

Lihlakha v. United States, supra.

The opinion goes on to explain that Lihlakha's appointed counsel for the appeal proceedings relied on

cases from this jurisdiction recognizing that `rewards are governed by the law of [unilateral] contracts,’ meaning, in this context, that any agreement for a reward between the owner of stolen property and someone who has come to possess it would be non-binding until the possessor has satisfied all the conditions for the reward announced by the owner. Counsel maintains that such a contract was satisfied here, free of criminal taint, upon Lihlakha's attempted delivery of Banks's laptop. And that contract was valid, says counsel, because `possession of [stolen] property with the consistent intent of obtaining it to return it to the owner for a freely advertised reward’ will negate `the mental intent element of the crime of receiving stolen property’.

Lihlakha stresses, therefore, that she did not intend to deprive Banks of her laptop, even though she knew it was stolen, because she merely obtained the laptop `with the intent to return it in exchange for the reward.’ This court has never considered the relevance, if any, of returning stolen property for a reward when defending a charge of RSP. Other courts have done so, however, beginning with a premise derived from the common law, as codified in the Model Penal Code: `[T]he offense is established by knowing possession of stolen property “unless the property is received, retained, or disposed with purpose to restore it to the owner.”’ The `unless’ clause is where interpretation begins. Most courts stress that to avoid conviction of RSP, one must return the property to its rightful owner `immediately,’ or in lieu of the owner to `law enforcement officials,’ and in any event must do so `unconditionally.’

The courts appear uniformly to uphold RSP convictions if the possessor of property known to be stolen expressly conditions return of the property on receipt of compensation. Courts, however, have come to distinguish between demanding payment for the return of stolen property and returning stolen property in response to an offer of a reward. These courts, reflecting the common law, eliminate the return-for-reward mentality from criminal intent if the evidence shows that `the reward has been announced or is believed to have been announced before the property is possessed or agreed to be possessed;’ `that the person claiming the reward had nothing to do with the theft’; and, as we have noted, that the person `immediately and unconditionally turned over the goods to the rightful owner or to law enforcement officials.’

Lihlakha v. United States, supra.

The Court of Appeals then took up its analysis of whether Lihlakha had successfully asserted a return for reward defense by explaining that at her trial,

[a]fter hearing the parties' opening statements, the trial judge observed:

`[S]he learns from fliers that a computer has been stolen. She has it in her possession. She seeks to get money for it. She's on notice that it's stolen and doesn't turn it over to the police or anybody else until she arranges a meeting to profit by it. If that's the way the evidence comes out, it seems to me unless I am missing something that that would inexorably establish her guilt beyond a reasonable doubt.'

Thus, the judge seemed to believe that the proffered behavior of responding to a previously offered reward was enough in itself to establish the `intent to deprive.’ At that point, therefore, the judge did not appear to recognize the possibility that expectation of a reward for return of stolen property could be consistent with innocent intent. Nor did the judge do so later when defense counsel argued rather opaquely the return-for-reward defense in his closing statement.

On appeal, however, the government does recognize a return-for-reward defense, although in a curious, very limited way. The government acknowledges that if the evidence shows that the possessor of property, known to be stolen, intended to return it to the owner even without the reward, then the possessor's expectation of a reward, as advertised, could not be understood as an unlawful condition on the return. Emphatically, however, government counsel argued that this case does not reflect that limited exception. According to the government, while not expressly conditioning return of the laptop on the announced reward, Lihlakha's behavior was tantamount to imposing an express, and thus unlawful, condition.

Lihlakha v. United States, supra.

The Court of Appeals went on to explain that

[w]e believe the government is right to acknowledge that mere expectation of a reward upon swiftly returning known stolen property to the owner or designee does not automatically establish the intent required by our statute for conviction of RSP. However, the government's understanding of the return-for-reward defense is based on a speculative scenario not only absent on the demonstrable facts of record but also unworkable on the hypothetical facts the government posits. The government presupposes proof of an intent that cannot in all likelihood be established, that is, what the possessor of stolen property would have done if the owner had revoked the reward—but did not. As to this case, more specifically, the government argues that Lihlakha brought known stolen property to the owner, Banks, who had announced a reward, but that there can be no reasonable doubt that if Banks had refused to pay the reward—a situation that never occurred (because the police intercepted the tender)—Lihlakha would have withheld the computer. On this record, there is no way to know what Lihlakha's behavior would have been in that situation—a hypothetical revocation of an announced reward that allegedly would have transmuted Lihlakha's coming forward with the laptop into a postulated demand for payment upon returning it.

The legal issue, therefore, is not what Lihlakha would have done had the facts unfolded differently but, rather, whether the District's RSP law recognizes that a motive to obtain an announced reward is compatible with an intent to return known stolen property to its owner without imposing a forbidden condition that `deprive[s]’ the owner of `the right to the property or [its] benefit.’

Lihlakha v. United States, supra.

The court also noted that

[w]e perceive such compatibility in § 223.6(1) of the Model Penal Code, as elaborated by the U.S. Court of Appealsfor the Second Circuit's decision in Godwin v. United States, 687 F.2d 585 (1982)  and refined by other case law. We draw upon these understandings and conclude that a defendant may establish a return-for-reward defense that negates the requisite intent for receiving stolen property if the evidence shows that:

`(1) the reward had been announced, or was believed to have been announced, before the property was possessed or agreed to be possessed; (2) the person claiming the reward had nothing to do with the theft; (3) the possessor returned the property without unreasonable delay to the rightful owner or to a law enforcement officer; and (4) the possessor imposed no condition on return of the property.'

On this view of the law, there is a problem here for the government. The trial judge made no express finding on whether Lihlakha's returning the property in response to a reward negated her criminal intent. We therefore have a concern: the trial judge elaborated no further on his understanding of RSP law in reward cases than he expressed at the time of opening statements; thus, he may well have failed to consider all relevant aspects of a defendant's motivation under the law applicable to RSP. We turn, therefore, to the record to help inform our disposition of the case.

Lihlakha v. United States, supra.

The court went on to explain that,

[o]n the one hand, we cannot say that Lihlakha's testimony necessarily suggests that she, herself, imposed a condition on return of the laptop beyond mere expectation of the reward that Banks had announced. We therefore cannot say that her testimony was conclusive enough to demonstrate, as the government contends, that she was assuredly conditioning return of the laptop to Banks, contrary to the return-for-reward defense we recognize here.

On the other hand, from the testimony of Banks, Investigator Tarpley, and Lihlakha herself there is evidence sufficient for a finding that, by assisting Tony, Lihlakha had a culpable `intent to deprive’ the rightful owner of her laptop because she had something `to do with the theft.’ Specifically, based on the evidence of how Lihlakha came across Banks's laptop and her plan to split the reward with Tony, it would be reasonable for a fact-finder to infer that Lihlakha was aware that she was enabling either the thief or a fence to profit illegally from the theft, and thereby deprive Banks of the right to her property. The trial judge, moreover, expressed an unequivocal belief that Lihlakha's testimony, apparently `fashioned on the fly,’ lacked credibility. And, aside from discarding Investigator Brown's testimony relating to the scope of the barring notice, the trial court found `no other reason to question the testimony’ of the government's witnesses.

Lihlakha v. United States, supra.

The Court of Appeals also noted that,

even though the evidence may be sufficient to sustain a conviction, it does not compel it. As an appellate court, we do not make findings of fact and therefore may not rule on our own reading of the evidence unaided by the trial court's findings as to the return-for-reward defense. Nor may we assume at this time that the trial judge's skepticism about Lihlakha's credibility would determine the verdict when the judge evaluates the evidence anew in light of that defense.  Accordingly, we remand the record to the trial court for resumed consideration, and to make findings of fact responsive to the legal criteria we announce here.

Lihlakha v. United States, supra.

The court therefore affirmed Lihlakha’s conviction for

unlawful entry but remand the record for factual findings on the return-for-reward defense to the RSP charge consistent with this opinion. We perceive no basis for augmenting the record with additional evidence, and we retain jurisdiction, awaiting return of the trial court's findings.

Lihlakha v. United States, supra.