Testimony Based on Newspaper Reports Is Hearsay — Documents Seized from PLO Not Admissible under Residual Exception —Rule 807 Standards — Lay Opinion May Not Include Specialized Knowledge or Legal Opinion
United States v. El-Mezain, 664 F.3d 467 (5th Cir. 2011):
In this consolidated case, we address the appeals of five individuals and one corporate defendant convicted of conspiracy and substantive offenses for providing material aid and support to a designated terrorist organization. The terrorist organization at issue is Hamas, which in 1995 was named a Specially Designated Terrorist by Presidential Executive Order pursuant to authority granted by the International Emergency Economic Powers Act, 50 U.S.C. § 1701 et seq. Hamas was further designated as a Foreign Terrorist Organization in 1997, as contemplated by 18 U.S.C. § 2339B.
Although this case is related to terrorism, it does not involve charges of specific terrorist acts. Instead, it focuses on the defendants' financial support for terrorism and a terrorist ideology. The defendants were charged with aiding Hamas by raising funds through the corporate entity Holy Land Foundation for Relief and Development, a Texas-based, pro-Palestinian charity that the Government charged was created for the sole purpose of acting as a financing arm for Hamas. ***
The Government produced voluminous evidence obtained from covert surveillance, searches, and testimony showing a web of complex relationships connecting the defendants to Hamas and its various sub-groups. The financial link between the Holy Land Foundation and Hamas was established at the Foundation's genesis and continued until it was severed by the Government's intervention in 2001. ***
While no trial is perfect, this one included, we conclude from our review of the record, briefs, and oral argument, that the defendants were fairly convicted. For the reasons explained below, therefore, we AFFIRM the district court's judgments of conviction of the individual defendants. We DISMISS the appeal of the Holy Land Foundation for Relief and Development. ***
I. FACTUAL & PROCEDURAL BACKGROUND
The instant prosecution began with an indictment of the defendants in 2004 that ended in a mistrial in 2007 but with a partial verdict. The defendants were re-tried and convicted in 2008. The indictment, as superseded, charged the defendants with conspiracy to provide material support to a foreign terrorist organization (i.e., Hamas), in violation of 18 U.S.C. § 2339B(a)(1) (Count 1); providing material support to a foreign terrorist organization, in violation of 18 U.S.C. § 2339B(a)(1) (Counts 2-10); conspiracy to provide funds, goods, and services to a Specially Designated Terrorist (i.e., Hamas), in violation of 50 U.S.C. §§ 1701-1706 (Count 11); providing funds, goods, and services to a Specially Designated Terrorist, in violation of 50 U.S.C. §§ 1701-1706 (Counts 12-21); conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h) (Count 22); substantive money laundering, in violation of 18 U.S.C. § 1956(a)(2)(A) (Counts 23-32); forfeiture of assets; and certain tax offenses not relevant to this appeal.
The charges arose after many years of widespread surveillance conducted pursuant to the Foreign Intelligence Surveillance Act ("FISA") of several individuals and of the Holy Land Foundation for Relief and Development ("HLF"). Until it was closed by the Government in 2001, HLF was a pro-Palestinian charitable organization based in Richardson, Texas. Individual defendants Shukri Abu Baker, Ghassan Elashi, and Mohammad El-Mezain served as officers and directors for HLF. Defendant Abdulrahman Odeh managed HLF's New Jersey office, and Defendant Mufid Abdulqader was a speaker and performer who appeared at HLF fundraising events.
*** The Government charged that in reality HLF's mission was to act as a fundraising arm for Hamas, also known as the Islamic Resistance Movement, and to assist Hamas's social wing in support of Hamas's goal to secure a Palestinian Islamic state in what is now Israel. The indictment charged the defendants with assisting Hamas by funneling money to certain "zakat" committees located in the West Bank. Zakat committees are charitable organizations to which practicing Muslims may donate a portion of their income pursuant to their religious beliefs, but the Government charged that the committees to which the defendants gave money were part of Hamas's social network.
According to the evidence at trial, which we view in the light most favorable to the verdict, Hamas operates political, military, and social branches to serve its overall goal to destroy Israel. Its charter advocates violent jihad as the only solution for the conflict between Palestinians and Israelis, and it considers it the duty of all Muslims to participate in this objective either through direct action or through financial support. *** The social wing also supports the families of Hamas prisoners and suicide bombers, thereby providing incentives for bombing, and it launders money for all of Hamas's activities. Therefore, aid to Hamas's social wing critically assists Hamas's goals while also freeing resources for Hamas to devote to its military and political activities.
The evidence showed that HLF and Hamas were created along similar time lines. In 1987, a Palestinian revolt in Israel, known as the Intifada, spurred the founding of Hamas by Sheikh Ahmed Yassin as a representative organization for Palestine. Hamas considered itself to be the Palestinian branch of the Muslim Brotherhood, a much older Islamic organization created in the 1920s and to which Yassin belonged. After Hamas's formation, the Muslim Brotherhood directed its world-wide chapters to establish so-called "Palestine Committees" to support Hamas from abroad.
In the United States, Defendants Baker, El-Mezain, and Elashi were members of a Palestine Committee headed by unindicted co-conspirator Mousa Abu Marzook. The Government established that Marzook was the leader of Hamas's political wing in the 1990s. According to the prosecution's case, the Palestine Committee also created other organizations in the United States to support Hamas. The Committee created not only HLF but also the Islamic Association for Palestine ("IAP"), which was a media entity, and the United Association for Studies and Research ("UASR"), which published papers and books about Hamas. Defendant Baker was also an IAP board member.
In 1988, Baker founded the Occupied Land Fund as a Muslim charity in Indiana. He, Elashi, and El-Mezain later incorporated the organization in California before renaming it as HLF in 1991. In 1992, HLF moved to Texas, where it was located across the street from Elashi's computer company, Infocom Corporation. HLF stored many of its records and documents at Infocom, which were later seized by the FBI.
The defendants raised money through HLF by conducting nationwide fundraising events, conferences, and seminars where HLF sponsored speakers and solicited donations. *** HLF also conducted teleconferences where participants could listen to featured speakers and donate money. Prior to 1995, the individual defendants and HLF more or less openly supported Hamas. Then, after Hamas was designated as a terrorist organization, the defendants' support became less obvious. Speakers and performers at HLF fundraising events no longer openly referred to Hamas even though HLF continued to support the same zakat committees that Hamas controlled.
From 1992 to 2001, HLF raised approximately $56 million in donations. The Government charged that from 1995 to 2001, HLF sent approximately $12.4 million outside of the United States with the intent to willfully contribute funds, goods, and services to Hamas.
***In September 1993, Yasser Arafat, the leader of the Palestine Liberation Organization ("PLO"), and Israeli Prime Minister Yitzhak Rabin signed what became known as the Oslo Accords. These accords established mutual recognition between the Israeli government and the Palestinians. They also created a limited governing body for Palestinians, known as the Palestinian Authority ("PA"). As a political rival of Arafat and his Fatah political party, Hamas opposed the Oslo Accords.
One month after the Oslo Accords were signed, Defendants Baker and Elashi, and possibly Abdulqader, participated in a meeting at a Philadelphia hotel ("the Philadelphia meeting") that was secretly recorded by the FBI.***At one point, Baker instructed that if anyone should inquire about the purpose of the meeting, participants should explain that it was a "joint workshop" between HLF and the IAP. He also indicated that the participants should not mention "samah" in an explicit manner and should refer at the session only to "Sister Samah," which is Hamas spelled backwards. ***
***HLF under its previous name, the Occupied Land Fund ***
In January 1995 the President issued Executive Order 12947, designating Hamas as a Specially Designated Terrorist ("SDT"). *** Hamas was further designated as a foreign terrorist organization ("FTO") by the State Department in 1997 pursuant to Section 219 of the Immigration and Nationality Act, as added by the Antiterrorism and Effective Death Penalty Act of 1996.
On December 3, 2001, pursuant to the International Emergency Economic Powers Act, 50 U.S.C. § 1701 et seq. ("IEEPA"), the United States designated HLF as a SDT. The next day, the Treasury Department's Office of Foreign Assets Control ("OFAC") issued a blocking order on HLF's assets. On that same day, OFAC entered HLF's offices in Texas, New Jersey, Illinois, and California, and seized physical property. ***
At trial, the Government's evidence was voluminous and came from a variety of sources, including the above seizures, wiretaps, and financial documents. It also included evidence seized by the Israeli military from the zakat committees and from the PA's headquarters in Ramallah. The key issues addressed by the evidence were the connection between the defendants and Hamas, and Hamas's control of the zakat committees. The evidence also covered two general time periods: the time before Hamas was designated as a terrorist organization and the time following the designation.
Evidence demonstrating the defendants' support of Hamas before the designation included numerous video recordings showing several individual defendants appearing at HLF fundraising events attended by Hamas leaders, such as Marzook and Khalid Mishal, who is the current leader of Hamas's political wing. The speakers and performers praised Hamas at many of these events, where donations were encouraged and solicited by HLF. Some of the videos were seized from HLF offices, while others were found buried in the backyard of a residence formerly occupied by Fawaz Mushtaha, who was associated with the Palestine Committee and also played in the same band with Defendant Abdulqader.
The Government also presented evidence of numerous financial transactions between HLF and Hamas leader Marzook and Marzook's wife Nadia.3 Marzook further had personal connections to the defendants as shown through numerous telephone calls to El-Mezain and Baker, and the listing of contact information for El-Mezain, Baker, and Elashi in his personal telephone book.
Mohamed Shorbagi, a former HLF representative who pleaded guilty in a separate case, testified that HLF's purpose was to support Hamas. He testified about attending closed meetings with the individual defendants and Hamas leaders. He described one meeting in 1994 where Marzook introduced Mishal, who spoke about the emergence of Hamas and the participants' roles in supporting the Hamas movement. According to Shorbagi, El-Mezain led a sub-group from that meeting in discussions on fundraising.
Shorbagi's testimony that HLF supported Hamas was consistent with testimony from an Israeli Security Agency employee who provided expert testimony about Hamas financing. Using the pseudonym "Avi" for security reasons, the witness testified that most of the zakat committees that received funds from HLF had come under the control of Hamas by 1991. This testimony was also consistent with conversations captured from the Philadelphia meeting in 1993, wherein Muin Shabib, who was later identified at trial as a Hamas leader, discussed the zakat committees and the extent to which they were "ours," meaning Hamas. It was also consistent with a 1991 letter addressed to Baker found in Elbarasse's home that discussed various zakat committees and used the same language to indicate which committees were controlled by Hamas.
Prior to 1995 it was not illegal for HLF to have a relationship with or to provide support for Hamas. The above evidence was therefore important to establish the defendants' relationship with Hamas figures and to demonstrate their intent when viewed in conjunction with other evidence of their post-1995 conduct. The Government presented evidence through video recordings, letters, and other documents found in HLF's possession demonstrating that the defendants continued to support Hamas. *** But perhaps the strongest evidence that the defendants' provided support to Hamas after Hamas was designated as a terrorist organization came through testimony and financial documents showing that HLF provided funds to the same Hamas-controlled zakat committees that it had supported before the designation.
The evidence of Hamas control of the zakat committees was substantial. For example, the Government offered testimony from Dr. Matthew Levitt, an expert on the subject of Hamas, who testified based on his research that Hamas controls many of the zakat committees in the West Bank and Gaza. Avi also testified from his personal study of Hamas that all of the zakat committees named in the indictment were Hamas institutions. In addition, the Israeli military seized a voluminous amount of evidence related to Hamas from the zakat committees. This evidence included Hamas posters and paraphernalia, as well as internal Hamas documents and communications. The evidence also included video recordings seized from the zakat committees showing school ceremonies and other events consistent with Hamas ideology and Hamas's use of its social wing to promote its agenda. Furthermore, numerous individuals connected to the various zakat committees were identified as prominent Hamas leaders.
The defendants' theory at trial largely was that they did not support Hamas or terrorism, but rather shared a sympathy for the plight of the Palestinian people through support of the zakat committees and the charitable work the committees performed. Their view was that the Government never designated as a terrorist organization any of the zakat committees or anyone connected to the committees. They argued that the Treasury Department had to designate a zakat committee before contributions to it would be unlawful, suggesting that non-designated committees were not controlled by Hamas.***
B. Hearsay evidence
The defendants contend that the district court improperly admitted the following three categories of hearsay evidence that linked the defendants to Hamas or that linked Hamas to the zakat committees: (1) the testimony of Mohamed Shorbagi, (2) documents seized by the Israeli military from the headquarters of the Palestinian Authority during Operation Defensive Shield, and (3) documents seized from the homes of unindicted co-conspirators Elbarasse and Ashqar. We review the district court's evidentiary rulings for an abuse of discretion. United States v. Jackson, 636 F.3d 687, 692 (5th Cir. 2011).
Before addressing the defendants' specific evidentiary challenges, we pause to note that the hearsay issue, like the defendants' other evidentiary issues raised on appeal, is subject to a harmless error analysis if we find there was an error. ***Except for certain issues related to testimony from John McBrien and Steven Simon, which we will explain below, we then consider in a combined discussion whether any errors we identify may be considered harmless.
1. Mohamed Shorbagi
Mohamed Shorbagi was a representative of HLF in Georgia who helped raise funds for the organization. He pleaded guilty in a separate case to providing material support to Hamas through HLF, and he testified in the instant case as part of a plea agreement. Shorbagi testified that Hamas controlled several zakat committees in the West Bank and Gaza to which HLF donated money. He also identified several people associated with the committees as Hamas leaders, and he stated that HLF was a part of Hamas. The defendants challenge this testimony as improper hearsay, contending that Shorbagi merely repeated what he had read in newspapers and what he had learned from friends. At one point during his testimony, the Government asked Shorbagi the basis for his knowledge, and he responded: "It came from newspapers, it came from leaflets, it came from Hamas-the internet later on in '98, '99, the website of Hamas, and from also talking among friends." The defendants base their argument on appeal in large part on this exchange.
*** If Shorbagi was merely repeating what he had read or what someone had told him, it would be hearsay and inadmissible. See, e.g., Roberts v. City of Shreveport, 397 F.3d 287, 295 (5th Cir. 2005) (newspaper articles are "classic inadmissible hearsay"); see Fed. R. Evid. 802. However, Shorbagi's testimony is more complicated than that, as a review of the record shows that he possessed personal knowledge of some of the facts to which he testified.
A witness's testimony must be based on personal knowledge. United States v. $92,203.00 in U.S. Currency, 537 F.3d 504, 508 (5th Cir. 2008); see Fed. R. Evid. 602 ("A witness may not testify to a matter unless evidence is introduced sufficient to support a finding that the witness has personal knowledge of the matter."). The personal knowledge requirement and the hearsay rule "are cut at least in part from the same cloth," as Rule 602 prevents a witness from testifying about a hearsay statement upon which he has no personal knowledge. United States v. Quezada, 754 F.2d 1190, 1195 (5th Cir. 1985). It is axiomatic that a witness may not merely repeat the subject matter of a hearsay statement, nor may he rely on inadmissible hearsay as a substitute for his own knowledge. Id. If the evidence supports a finding that the witness does possess personal knowledge, however, he may testify on that basis. Id. In the instant case, we conclude that Shorbagi's testimony revealed a close association with and knowledge of HLF and the individual defendants, as well as HLF's fundraising activity, that demonstrated personal knowledge and made his testimony about HLF's connection with Hamas admissible. His testimony about Hamas's control of specific zakat committees is more problematic. ***
Shorbagi expressly testified that Hamas controlled the zakat committees in Nablus, Jenin, Ramallah, and Hebron, all of which were charged in the indictment as receiving funds from HLF. Shorbagi may very well have personally known that these committees were controlled by Hamas from his activity in raising money for HLF, from attending conferences with the individual defendants, and from meeting various Hamas leaders at the conferences. However, when asked the crucial question as to the basis for this specific knowledge, Shorbagi gave as examples "newspapers," "leaflets," the "internet," and "friends." These sources constitute classic hearsay rather than personal knowledge. See, e.g., Roberts, 397 F.3d at 295 (newspapers are hearsay); United States v. Jackson, 208 F.3d 633, 637 (7th Cir. 2000) (web postings from the Internet were inadmissible hearsay). In an effort to rehabilitate Shorbagi's answer, the Government asked if the "friends" to which Shorbagi referred were persons who were involved with him in supporting Hamas and organizations like HLF. But Shorbagi's affirmative response did not transform his apparent reliance on the statements of others, whether they were similarly situated to him or not, into personal knowledge. We therefore conclude that Shorbagi's testimony that Hamas controlled the zakat committees was hearsay, and it was error for the district court to allow it. We consider below whether the error was harmless.
2. Documents seized from the Palestinian Authority
The defendants next challenge on hearsay grounds the admission of three documents ("the PA documents") seized by the Israeli military in 2002 from the PA headquarters in Ramallah. ***
The PA documents were excluded from the first trial but admitted at the second trial over defense objection under FED. R. EVID. 807, the residual exception to the hearsay rule. The Government argued that the documents had sufficient indicia of trustworthiness because the Israeli military had seized them from the PA headquarters and they were therefore akin to public records. The district court agreed, noting that the documents were not prepared in advance for litigation purposes and that two of them "appear to have some kind of letterhead." We conclude that the Government's justification for admitting the documents was insufficient to prove their trustworthiness, and they should have been excluded from the second trial.
Rule 807's residual hearsay exception allows the admission of hearsay statements that are not covered by another exception if the statements have "equivalent circumstantial guarantees of trustworthiness" and the district court determines that they are material, probative, and in the interests of justice.6 See FED. R. EVID. 807; United States v. Ismoila, 100 F.3d 380, 393 (5th Cir. 1996). The district court is given wide latitude in admitting evidence under the rule, and we "will not disturb the district court's application of the exception absent a definite and firm conviction that the court made a clear error of judgment in the conclusion it reached based upon a weighing of the relevant factors." United States v. Phillips, 219 F.3d 404, 419 n.23 (5th Cir. 2000) (internal quotation marks and citation omitted). Nevertheless, the "exception is to be 'used only rarely, in truly exceptional cases.'" Id. (citation omitted). Moreover, "[t]he proponent of the statement bears a heavy burden to come forward with indicia of both trustworthiness and probative force. In order to find a statement trustworthy, a court must find that the declarant of the . . . statement 'was particularly likely to be telling the truth when the statement was made.'" Id. (internal quotation marks and citations omitted).
We therefore focus on the "equivalent circumstantial guarantees of trustworthiness" requirement, which is the "lodestar of the residual hearsay exception analysis." United States v. Walker, 410 F.3d 754, 758 (5th Cir. 2005). The determination of trustworthiness is "drawn from the totality of the circumstances surrounding the making of the statement, but [it] cannot stem from other corroborating evidence." Ismoila, 100 F.3d at 393 (citing Idaho v. Wright, 497 U.S. 805, 820-22, 110 S. Ct. 3139, 111 L. Ed. 2d 638 (1990)). "[E]vidence possessing 'particularized guarantees of trustworthiness' must be at least as reliable as evidence admitted under a firmly rooted hearsay exception . . . [and] must similarly be so trustworthy that adversarial testing would add little to its reliability." Wright, 497 U.S. at 821 (citations omitted).
As it argued to the district court, the Government maintains on appeal that the PA documents are reliable and trustworthy because they are essentially public records, which ordinarily are admissible under Rule 803(8).7 It is therefore proper to measure the PA documents against the requirements of the public records exception. See 2 KENNETH S. BROUN, MCCORMICK ON EVID. § 324 (6th ed.) (noting that for purposes of Rule 807 "courts frequently compare the circumstances surrounding the statement to the closest hearsay exception"); see also United States v. Wilson, 249 F.3d 366, 375-76 (5th Cir. 2001) (holding that, although foreign bank records were not admissible under the business records exception because there was no custodian available to testify, the district court properly admitted the documents under Rule 807 because "bank documents, like other business records, provide circumstantial guarantees of trustworthiness because the banks and their customers rely on their accuracy in the course of business"), abrogated on other grounds by Whitfield v. United States, 543 U.S. 209, 125 S. Ct. 687, 160 L. Ed. 2d 611 (2005).
The public records exception to the hearsay rule "is designed to permit the admission into evidence of public records prepared for purposes independent of specific litigation." Quezada, 754 F.2d at 1194. It is based on the notion that public records are reliable because there is a "lack of . . . motivation on the part of the recording official to do other than mechanically register an unambiguous factual matter." Id.; see also Moss v. Ole South Real Estate, Inc., 933 F.2d 1300, 1308 (5th Cir. 1991) (explaining that the public records hearsay exception is premised on "public officials doing their legal duties," such that the usual "distrust" of statements made by out-of-court declarants does not apply). The Government contends that the PA documents have sufficient circumstantial guarantees of trustworthiness as public documents under Rule 803(8)(A) and 803(8)(B) because the facts in the documents merely represent "activities of the office" or "matters observed pursuant to duty."
The matters reported in the PA documents have nothing to do with the PA's own activity, but rather describe the activities and financing of Hamas. Therefore, the guarantee of trustworthiness associated with a public agency merely recording its own actions is not present. See Rule 803(8)(A). Moreover, the conclusions stated in the PA documents are not the kind of objective factual matters we have found to be reliable under Rule 803(8)(B) when reported as a matter of course. See, e.g., Quezada, 754 F.2d at 1194 (holding that deportation record containing date and location of deportation was reliable under Rule 803(8)(B) because the document contained a "routine, objective observation, made as part of the everyday function of the preparing official"); United States v. Dancy, 861 F.2d 77, 79-80 (5th Cir. 1988) (finding that fingerprint card containing defendant's fingerprints, physical description, sentence, and prison reporting date admissible under Rule 803(8)(B)); United States v. Puente, 826 F.2d 1415, 1417 (5th Cir. 1987) (holding that computer printouts showing that vehicle crossed the border at a specific time were reliable under Rule 803(8)(B) because license plate number was observed and recorded by customs officer complying with agency directives and procedures that were adopted to carry out its legal duty to protect the border). Instead, the PA documents contain conclusions about Hamas control of the Ramallah Zakat Committee and the sources of Hamas financing that were reached through unknown evaluative means.
This leads to a larger problem with the documents: there is nothing known about the circumstances under which the documents were created, the duty of the authors to prepare such documents, the procedures and methods used to reach the stated conclusions, and, in the case of two of the documents, the identities of the authors. ***
We know only that the PA documents were found in the possession of the PA. ***
The Government argues that the PA had a "strong incentive" to report accurate information about Hamas. There is no doubt that may be true, but the Government points to nothing in the record about the PA's practice of record keeping. There is also nothing in the documents or the record showing that the declarants in these documents were especially likely to be telling the truth. See Phillips, 219 F.3d at 419 n.23. We therefore cannot say that there was little to gain from further adversarial testing. Without further information about the circumstances under which the PA documents were created, we are faced with conclusory assertions amounting to classic hearsay and no facts from which to divine the documents' reliability.
We realize that when dealing with foreign documents, it may not be possible for the Government to learn every detail about the evidence, especially when it has been seized in a military operation. We do not foreclose the possibility that obtaining documents in such a manner from an adversary may have some probative value and could, at least under some circumstances, be indicative of trustworthiness. But the instant documents were not offered merely for their probative value, and their seizure from the PA, without more, does not impart sufficient indicia of trustworthiness in this case to permit their admission. ***
D. Expert and lay opinion testimony
1. John McBrien
John McBrien was the associate director of OFAC. He testified about the Treasury Department's failure to designate the zakat committees as terrorist organizations. He also opined about whether one may donate to the committees if they are not designated. The defendants argue that McBrien was not noticed as an expert witness, that his testimony was improper lay opinion, and that he gave an improper legal conclusion. We agree with the defendants.
"Under FED. R. EVID. 701, a lay opinion must be based on personal perception, must be one that a normal person would form from those perceptions, and must be helpful to the jury." United States v. Riddle, 103 F.3d 423, 428 (5th Cir. 1997) (internal quotation marks and citation omitted). A lay witness may not give an opinion that requires "scientific, technical, or other specialized knowledge within the scope of Rule 702." FED. R. EVID. 701. It is also generally prohibited for a lay witness to interpret statutes and to give legal opinions. See Griffin, 324 F.3d at 347-48. In Riddle, we held that it was improper for a lay witness in a bank fraud prosecution to explain provisions of the banking regulations, to express his opinion on "prudent" banking practices, and to "draw on his specialized knowledge as a bank examiner" in giving his opinions about the defendant's actions. Riddle, 103 F.3d at 428-29; see also Huff v. United States, 273 F.2d 56, 61 (5th Cir. 1959) (where issue was whether jewelry was exempt from duty, a customs inspector was improperly allowed to testify about his own construction of the customs laws, rules, and regulations, and to opine that the jewelry found in defendant's possession was commercial in nature rather than a personal effect).
In the instant case, McBrien explained that the Treasury Department typically does not designate every sub-group or component of a designated terrorist organization because it focuses its limited resources on designating the key parts of the organization. He also read from Treasury regulations. He then testified that a person donating money must ensure that the donation is not going to a sub-entity or front for the designated organization. He answered a hypothetical question about a specific group with Hamas ties, known as the al-Salah Society, explaining that if one lacked knowledge about the Hamas connection, a donation to al-Salah would not be illegal but that if one did have knowledge, donating to the group would be prohibited.
McBrien's testimony was helpful to the jury and was relevant because it addressed the defendants' complaints that none of the zakat committees to which HLF provided funds was designated as a terrorist organization. But McBrien's testimony about the Treasury Department's practice in designating or not designating sub-groups of terrorist organizations is not within the realm of an ordinary lay witness. The Government argues that McBrien's testimony was based on his personal knowledge and served to rebut the defense theory that because the zakat committees were not on the designation list they were not controlled by Hamas. McBrien's opinions and explanations were the product of specialized knowledge, however. It is true that lay witnesses may sometimes give opinions that require specialized knowledge, but the witness must draw "straightforward conclusions from observations informed by his own experience." Riddle, 103 F.3d at 429. Rather than make straightforward conclusions from his observations, McBrien explained the procedures of OFAC.
We are also troubled by McBrien's testimony about the "test" for whether a donation may be made to an entity that is not on the designation list. McBrien explained, in part, that the "basic test is, is the entity or the individual owned or controlled by or acting for or on behalf of the designated entity or the designated organization. . . . [I]t means are you acting as an intermediary for them, are you acting as their front organization, are you their straw man, are you their go between." This testimony stated a legal test and was improper under our precedent. See Griffin, 324 F.3d at 347-48 (improper to allow Government witness to read from state statutes and to give her own interpretation of the law); Riddle, 103 F.3d at 428-29 (explanation of banking regulations held to be improper lay testimony).
Nevertheless, any error that occurred in the admission of McBrien's testimony was harmless because the testimony was cumulative to other testimony before the jury. See Griffin, 324 F.3d at 348. Dr. Levitt, a Government expert witness, also testified that the Treasury Department does not include every component of a terrorist organization on the designation list because doing so would be impossible. Levitt explained that the omission of a sub-group from the designation list does not mean that the group is not part of Hamas or that American citizens may donate money to the sub-group. Levitt further explained that the Treasury Department does not provide so-called "white lists" of approved organizations. Thus, McBrien's testimony was cumulative to Levitt's testimony. See id. ("Where objected to testimony is cumulative of other testimony that has not been objected to, the error that occurred is harmless.").
Furthermore, although McBrien gave an improper legal opinion and provided testimony based on specialized knowledge, he did not express any opinions as to the defendants' specific conduct in the case. This is unlike other instances where we have found error in the admission of improper expert testimony. See, e.g., Riddle, 103 F.3d at 429 (lay witness gave improper opinion that bank operated "imprudently," which required witness's expert understanding of the banking industry); Huff, 273 F.2d at 61 (lay witness opined on specific legal nature of the goods at issue). We think that fact plus the cumulative nature of the evidence militates toward the harmless error conclusion. We therefore hold that McBrien's testimony was harmless and was not reversible error.
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