United States v. Bowler ( 1995 )

                           FOR THE FIFTH CIRCUIT
                                No. 95-30409
                              Summary Calendar
                    UNITED STATES OF AMERICA,
                    MICHAEL J. BOWLER;
                    WALTER L. SENTENN, JR.,
               Appeal from the United States District Court
                   for the Eastern District of Louisiana
                              (July 19, 1995)
    Before KING, JOLLY, and DAVIS, Circuit Judges.
         Michael Bowler and Walter Sentenn appeal from the district
    court's denial of their petition for a writ of habeas corpus.
    Having reviewed the arguments, we remand to the district court with
    instructions to vacate its order of denial and to dismiss their
          Local Rule 47.5 provides: "The publication of opinions
    that have no precedential value and merely decide particular
    cases on the basis of well-settled principles of law imposes
    needless expense on the public and burdens on the legal
    profession." Pursuant to that Rule, the court has determined
    that this opinion should not be published.
         On August 17, 1993, Bowler and Sentenn were indicted on one
    count of conspiracy to commit mail fraud and fourteen counts of
    mail fraud pursuant to federal statutes.                    The indictment alleged
    that Bowler and Sentenn created the fraudulent appearance of
    solvency    for    their    insurance          company,     Pelican    State    Mutual
    Insurance   Company,       when    Pelican       was   in   fact    insolvent.      By
    maintaining this misrepresentation of solvency, the indictment
    alleged    that    Bowler    and    Sentenn        obtained     salaries,      expense
    accounts,    rental    cars,      health       insurance,     and     other   monetary
    benefits for their personal gain.
         On October 12, 1993, Bowler and Sentenn filed a motion to
    dismiss the indictment on the grounds that the district court
    lacked jurisdiction to prosecute them for their allegedly illegal
    conduct in operating an insurance company.                     Bowler and Sentenn
    relied on the McCarran-Ferguson Act,1 see 15 U.S.C. §§ 1011 et
    seq., to argue that the federal district court lacked subject
    matter jurisdiction over the underlying indictment and the criminal
    trial.    On January 19, 1994, the district court denied the motion.
              The McCarran-Ferguson Act provides in the following
    relevant part:
         No Act of Congress shall be construed to invalidate,
         impair, or supersede any law enacted by any State for
         the purpose of regulating the business of insurance . .
         . unless such Act specifically relates to the business
         of insurance . . . .
    15 U.S.C. § 1012(b).
         On March 23, 1995, Bowler and Sentenn filed a pre-trial
    "Petition for Writ of Habeas Corpus" pursuant to 28 U.S.C. §
    2241(c)(1) and (2). The district court denied the petition, noting
    that the issue presented was whether federal charges could be
    brought in light of the McCarran-Ferguson Act, and stating that:
         [n]otwithstanding the protestations of petitioners to the
         contrary, this issue was squarely raised in a previously
         filed motion to dismiss and was squarely addressed by
         Judge McNamara in January 1994 when he found that "the
         mail fraud prosecution against Bowler and Sentenn does
         not interfere with, impair, supersede or invalidate any
         state law regulating the business of insurance" and
         denied the motion.
    Bowler and Sentenn appeal from this determination.2
                         II.   STANDARD OF REVIEW
         In a federal habeas corpus proceeding, we review the district
    court's legal determinations de novo.         See, e.g., Johnson v.
    929 F.2d 1067
    , 1070 (5th Cir. 1991).
                      III.   ANALYSIS AND DISCUSSION
         Bowler and Sentenn argue that their pre-trial writ of habeas
    corpus was improperly dismissed.       As they maintain, the petition
    involved serious questions "of the separation of powers and the
    effect of the Tenth Amendment."       They contend that the appeal is
    properly before us, and their petition once again emphasizes that
              There is no certificate of probable cause ("CPC") in
    the record, and neither the district court nor the parties
    mention the need for a CPC or the absence of a CPC. We assume,
    without deciding, that denials of habeas petitions filed pursuant
    to § 2241 require a CPC to appeal. Construing Bowler's and
    Sentenn's notice of appeal as an application for a CPC, we grant
    the application and allow the appeal to proceed.
    the government's attempts to prosecute them are pre-empted by the
    McCarran-Ferguson Act.
           A pre-trial writ of habeas corpus is only available to a
    defendant in extraordinary circumstances.         In Johnson v. Hoy, 
    227 U.S. 245
    ,   247   (1913),   the   Supreme   Court   made   the   following
           The writ of habeas corpus is not intended to serve the
           office of a writ of error even after verdict; and, for
           still stronger reasons, it is not available to a
           defendant before trial, except in rare and exceptional
           cases . . . . This [case] is an effort to nullify that
           rule, and to depart from the regular course of criminal
           proceedings by securing from this court, in advance, a
           decision on an issue of law which the defendant can raise
           in the district court, with the right, if convicted, to
           a writ of error on any ruling adverse to his contention.
           That the orderly course of a trial must be pursued and
           the usual remedies exhausted, even where the petitioner
           attacks on habeas corpus the constitutionality of the
           statute under which he was indicted, was decided in
           Glasgow v. Moyer. That and other similar decisions have
           so definitively established the general principle as to
           leave no room for further discussion.
    (emphasis added) (citations omitted).         In the later case of Stack
    v. Boyle, 
    342 U.S. 1
     (1951), the Supreme Court reiterated its
           In this case, however, petitioners did not take an appeal
           from the order of the District Court denying their motion
           for reduction of bail. Instead, they presented their
           claims under the Eighth Amendment in applications for
           writs of habeas corpus.      While habeas corpus is an
           appropriate remedy for one held in custody in violation
           of the Constitution, the District Court should withhold
           relief in this collateral habeas corpus action where an
           adequate remedy available in the criminal proceeding has
           not been exhausted.
    Id. at 6-7 (citations omitted).
           We have adopted this position in our circuit as well.              In
    United States v. Saegert, 
    251 F.2d 59
     (5th Cir. 1957), we noted
    "the settled principle that a writ of habeas corpus may not be used
    . . . as a substitute for the ordinary proceedings of a trial
    court."      Id.   at   60.   In   addition,   we   made   the   following
         "[T]he writ is not intended as a substitute for the
         functions of a trial court. . . . Habeas Corpus is not
         ordinarily available in advance of trial to test the
         constitutionality of a statute under which the petitioner
         was indicted, or even to determine every jurisdictional
         question which may arise."
    Id. at 60 n.2 (quoting 25 Am. Jur. Habeas Corpus §§ 17, 21)
    (collecting cases); see also Warner v. Zent, 
    997 F.2d 116
    , 131 (6th
    Cir. 1993) ("`Habeas corpus is not intended as a substitute for
    appeal . . . . '") (quoting Wright v. West, 
    112 S. Ct. 2482
    , 2490
    (1992)); cf. Marone v. United States, 
    10 F.3d 65
    , 67 (2d Cir. 1993)
    ("A § 2255 petition may not be used as a substitute for direct
         The instant case is not a "rare and exceptional" situation3
    that requires us to consider a pre-trial writ of habeas corpus.
              By way of example, the Ninth Circuit was faced with
    such a "rare and exceptional" case. In Mannes v. Gillespie, 
    967 F.2d 1310
    , 1312 (9th Cir. 1992), the court made the following
         The Fifth Amendment's protection against double
         jeopardy -- "nor shall any person be subject for the
         same offense to be twice put in jeopardy of life and
         limb" -- is not against being twice punished, but
         against being twice put in jeopardy. Because full
         vindication of the right necessarily requires
         intervention before trial, federal courts will
         entertain pre-trial habeas petitions that raise a
         colorable claim of double jeopardy.
    (citations omitted) (internal quotation omitted).
    Bowler and Sentenn are clearly asserting that the McCarran-Ferguson
    Act pre-empts the federal charges against them, and they contend
    that    the   allegations   are   "a     matter    of   Louisiana   law,   to   be
    determined in accordance with the standards established by that
    law."     Even though the district court denied relief on these
    grounds, Bowler and Sentenn can proceed to trial and can raise this
    argument again on direct appeal.               There is simply no exigency,
    urgency, or any other reason for us to allow the habeas petition as
    a substitute for direct appeal in this matter.                      Instead, we
    conclude that the merits of Bowler's and Sentenn's arguments should
    be   presented    and   reached    "in       the   orderly   administration     of
    justice."     Saegert, 251 F.2d at 61.
                                 IV.       CONCLUSION
           Following the lead of the Supreme Court in Stack, 342 U.S. at
    7, and of our own decision in Saegert, 251 F.2d at 60-61, we REMAND
    to the district court with instructions to VACATE its order denying
    Bowler's and Sentenn's petition for a writ of habeas corpus and to
    DISMISS the petition without prejudice.