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Final Report and Recommendation — United States v. Richard Thompson (N.D. Ga., Dkt. 36, August 24, 2021)

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Final Report and Recommendation in United States v. Richard Thompson, Criminal Action No. 1:20-cr-00438-LMM-RDC-1, in the U.S. District Court for the Northern District of Georgia, Atlanta Division, Document 36, filed August 24, 2021. It addresses the defendant's Motion to Dismiss Counts 14–24 of the Indictment (Doc. 28), which argues that 18 U.S.C. § 924(m) exceeds Congress' power under the Commerce Clause, both facially and as applied. The undersigned discusses Lopez, Morrison and Raich and recommends that the Motion be DENIED as to both the facial and the as-applied challenge. The case is certified ready for trial, and the signature block names Regina D. Cannon, United States Magistrate Judge.

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“Final Report and Recommendation — United States v. Richard Thompson (N.D. Ga., Dkt. 36, August 24, 2021).” Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/court-filing-no-1-20-cr-00438-dkt-36-n-d-ga-bf770ded96/, SHA-256 4879be1a0fbf40dbd06393ba0d5f3ac0259ddd1bd432a97b3f254945b9a0b0d0.

Full text

 Case 1:20-cr-00438-LMM-RDC Document 36 Filed 08/24/21 Page 1 of 16




                IN THE UNITED STATES DISTRICT COURT
               FOR THE NORTHERN DISTRICT OF GEORGIA
                         ATLANTA DIVISION

UNITED STATES OF AMERICA,

v.
                                            CRIMINAL ACTION NO.
RICHARD THOMPSON,                           1:20-cr-00438-LMM-RDC-1

      Defendant.

               FINAL REPORT AND RECOMMENDATION

      Before the Court is Defendant Richard Thompson’s Motion to Dismiss

Counts 14–24 of the Indictment, (Doc. 28). Briefing is complete, and Defendant’s

Motion is now ripe for review. For the reasons stated below, the undersigned

respectfully RECOMMENDS that the Motion be DENIED.

                      I. PROCEDURAL BACKGROUND

      On November 17, 2020, Defendant was charged with the following offenses:

      Counts 1–13
      Defrauding his former employer, a federally licensed firearms
      manufacturer and dealer located in Conyers, Georgia, in violation of 18
      U.S.C. § 1341.

      Counts 14–24
      Stealing firearms from his former employer, in violation of 18 U.S.C.
      § 924(m).

(Doc. 1).

      On June 9, 2021, Defendant moved to dismiss certain of the latter charged
  Case 1:20-cr-00438-LMM-RDC Document 36 Filed 08/24/21 Page 2 of 16




offenses, arguing that § 924(m) exceeds Congress’ power under the Commerce

Clause, both facially (as to Counts 14–24) and as applied to the facts of his case (as

to Counts 14–20, 22, 24), because the statute does not establish a sufficient nexus to

interstate commerce.1 (Doc. 28).

                                       II. DISCUSSION

       Defendant challenges the authority of Congress, so this discussion begins with

what Congress actually said. Section 924(m) provides:

       A person who steals any firearm from a licensed importer, licensed
       manufacturer, licensed dealer, or licensed collector shall be fined under
       this title, imprisoned not more than 10 years, or both.

18 U.S.C. § 924(m).

       Defendant argues, first, that § 924(m) is unconstitutional on its face because

it purports to criminalize even purely intrastate theft, a matter he maintains is beyond

Congress’ authority to regulate interstate commerce. In support, he relies on two




       1
          Defendant also argues that § 924(m) violates the Tenth Amendment, which provides that
“[t]he powers not delegated to the United States by the Constitution, nor prohibited by it to the
States, are reserved to the States respectively, or to the people.” (Doc. 28 at 1, 4, 6); U.S. Const.
amend. X. However, the Eleventh Circuit has held that that Congress does not violate the Tenth
Amendment when it enacts legislation through the constitutionally permissible exercise of its
Commerce Clause power. See Cheffer v. Reno, 55 F.3d 1517, 1521 (11th Cir. 1995) (“Because the
[challenged legislation] is within Congress’ Commerce Clause power, it does not violate the Tenth
Amendment.”); see also New York v. United States, 505 U.S. 144, 156–57 (1992) (“The Tenth
Amendment likewise restrains the power of Congress, but this limit is not derived from the text of
the Tenth Amendment itself, which, as we have discussed, is essentially a tautology. . . . The Tenth
Amendment thus directs us to determine . . . whether an incident of state sovereignty is protected
by a limitation on an Article I power.”). Accordingly, Defendant’s Tenth Amendment challenge
stands or falls with his Commerce Clause challenge.
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features of § 924(m)—first, it lacks a jurisdictional element requiring that the

firearm(s) at issue have actually travelled in or otherwise affected interstate

commerce; and second, it regulates activity—i.e., intrastate theft—that is non-

economic and non-commercial in nature. In short, according to Defendant, because

§ 924(m) encompasses activity that is neither interstate nor commercial, the statute

on its face exceeds Congress’ interstate commerce authority. In any event, because

most of the firearms at issue in his Indictment (specifically, those described by

Counts 14–20, 22, and 24) never actually traveled across state lines before the

alleged theft occurred, Defendant also contends that, at a minimum, Section 924(m)

is unconstitutional as applied to him. (Docs. 28, 35). In response, the Government

maintains that § 924(m) constitutes a lawful exercise of Congress’ authority to

regulate activities having a substantial relation to interstate commerce. (Doc. 33).

      A. Facial and As-Applied Challenges

      Defendant makes both facial and as-applied challenges to § 924(m). Before

turning to the merits, it is important to clarify at the outset the type of showing

required. “A facial challenge, as distinguished from an as-applied challenge, seeks

to invalidate a statute or regulation itself.” United States v. Frandsen, 212 F.3d 1231,

1235 (11th Cir. 2000). In other words, a facial challenge does not attack a particular

application of a statute, but all possible applications. See Jacobs v. The Florida Bar,

50 F.3d 901, 906 n.20 (11th Cir. 1995) (“[W]hen a plaintiff attacks a law facially,

                                           3
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the plaintiff bears the burden of proving that the law could never be constitutionally

applied.”). It is “the most difficult challenge to mount successfully” because it

requires a defendant to show “that no set of circumstances exists under which the

[law] would be valid.” United States v. Salerno, 481 U.S. 739, 745 (1987); see also

Frandsen, 212 F.3d at 1235 (stating that “no set of circumstances” is the general rule

for evaluating facial challenges in the Eleventh Circuit).

      Because there are applications of § 924(m) that would clearly be

constitutional—for instance, as applied to the theft of firearms that actually traveled

in interstate commerce—Defendant’s facial challenge cannot succeed. See Salerno,

481 U.S. at 745; Frandsen, 212 F.3d at 1235. The alleged infirmity with § 924(m)

is that the statute is overbroad, prohibiting the theft of firearms without any interstate

nexus. But insofar as such a nexus in fact exists—again, for example, if a stolen

firearm has moved across state lines—the infirmity dissolves. Defendant does not

argue otherwise. Indeed, Defendant implicitly concedes as much. His as-applied

challenge identifies no constitutional trouble with respect to those firearms

(specifically, those described in Counts 21 and 23) that admittedly traveled across

state lines. See (Doc. 28 at 5–6). Accordingly, the undersigned RECOMMENDS

that Defendant’s Motion to Dismiss be DENIED as to his facial challenge.

      So, that leaves only Defendant’s as-applied challenge. Importantly, when a

statute is challenged as exceeding Congress’ interstate commerce authority,

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reviewing courts are limited to rational-basis review only. Gonzalez v. Raich, 545

U.S. 1, 22 (2005) (“In assessing the scope of Congress’ authority under the

Commerce Clause, we stress that the task before us is a modest one. We need not

determine whether respondents’ activities, taken in the aggregate, substantially

affect interstate commerce in fact, but only whether a ‘rational basis’ exists for so

concluding.”); Montgomery Cnty. Comm’n v. Federal Housing Fin. Agency, 776

F.3d 1247, 1258 (11th Cir. 2015) (“Evaluating a statute’s validity [under the

Commerce Clause] requires this Court to determine only whether Congress had a

rational basis for determining the regulated activity substantially affects interstate

commerce.”).

      Accordingly, the specific question before the Court—which appears to be one

of first impression—is whether Congress, in enacting § 924(m), had a rational basis

to conclude that the intrastate theft of firearms substantially affects interstate

commerce. The answer is yes.

      B. Commerce Clause

      Under the Commerce Clause, “Congress shall have Power . . . [t]o regulate

Commerce . . . among the several States.” U.S. Const. art. I, § 8, cl. 3. Using its

interstate commerce power, Congress can regulate: (1) the “channels of interstate

commerce”; (2) “instrumentalities,” people, and “things in interstate commerce”;

and (3) ”activities that substantially affect interstate commerce.” United States v.

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Lopez, 514 U.S. 549, 558–59 (1995); United States v. Morrison, 529 U.S. 598, 608–

09 (2000). The parties agree that Congress’ authority as relevant to this case, should

it exist, derives from the third category.2

       The Supreme Court has held that “activities in this third category—those that

‘substantially affect’ commerce—may be regulated so long as they substantially

affect interstate commerce in the aggregate, even if their individual impact on

interstate commerce is minimal.” Taylor v. United States, 136 S.Ct. 2074, 2079

(2016) (citing Wickard v. Filburn, 317 U.S. 111, 125 (1942) (“[E]ven if appellee’s

activity be local and though it may not be regarded as commerce, it may still,

whatever its nature, be reached by Congress if it exerts a substantial economic effect

on interstate commerce.”)); see also Heart of Atlanta Motel, Inc. v. United States,

379 U.S. 241, 258 (1964) (“[I]f it is interstate commerce that feels the pinch, it does

not matter how local the operation which applies the squeeze.” (quotation and

citation omitted)).

       Broad as it is, this third category is not without limit. Local intrastate activity

may only be reached under the Commerce Clause if the activity at issue is itself



       2
         The undersigned recognizes that these categories “do not carve the commerce power into
three neat slices, but simply represent an effort to synthesize more than a century of Commerce
Clause enactments by grouping them in loose categories that are decidedly descriptive, rather than
definitional. Consequently, it is often the case that more than one category will accommodate a
given piece of legislation.” United States v. Peters, 403 F.3d 1263, 1271 n.1 (11th Cir. 2005).
However, because the parties agree that the third category applies here, the undersigned does not
consider whether § 924(m) might fall under another category.
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deemed to be “economic,” see Lopez, 514 U.S. at 561, or an “essential part of a

larger regulation of economic activity, in which the regulatory scheme could be

undercut unless the intrastate activity were regulated,” Raich, 545 U.S. at 24

(quoting Lopez, 514 U.S. at 561). To hold otherwise, the Supreme Court has

explained, would blur the line “between what is truly national and what is truly

local.” Lopez, 514 at 567–68.

      In his challenge to § 924(m), Defendant attempts to draw a close analogy

between his case and Lopez and Morrison, two cases in which the Supreme Court

invalidated statutes as beyond the third category of Congress’ interstate commerce

authority. However, it is a successor case—namely, Raich—that is most congruent

and, therefore, controls. Given the import of these cases, this discussion can

profitably reach the merits by first reviewing each decision, in turn.

      In Lopez, the defendant challenged his conviction under the Gun-Free School

Zones Act, which criminalized the possession of a firearm in school zones. 514 U.S.

at 551–52. While affirming Congress’ extensive authority to regulate activities

substantially affecting interstate commerce, the Court nevertheless held that the

regulation of gun possession in school zones stood outside the bounds of that

authority. Id. at 567–68. The Court explained that the statute contained no

jurisdictional element to ensure that the conduct in question actually implicated

interstate commerce. Id. at 561. Moreover, according to the Court, “the possession

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of a gun in a local school zone is in no sense an economic activity that might, through

repetition elsewhere, substantially affect any sort of interstate commerce.” Id. at 567.

Finally, the statute itself had “nothing to do with ‘commerce’ or any sort of economic

enterprise,” nor was it “an essential part of a larger regulation of economic activity,

in which the regulatory scheme could be undercut unless the intrastate activity were

regulated.” Id. at 561. To find the requisite connection to interstate commerce under

these circumstances, the Court concluded, would require it “to pile inference upon

inference in a manner that would bid fair to convert congressional authority under

the Commerce Clause to a general police power of the sort retained by the States.”

Id. at 567. Cautious of that outcome, the Court invalidated the statute. Id. at 567–68.

      Morrison clarified the holding of Lopez. In Morrison, a university student

brought civil claims under the federal Violence Against Women Act against several

students who allegedly raped her. 529 U.S. at 604–05. But the Court invalidated the

statute as exceeding the scope of Congress’ authority to regulate under the third

category of its interstate commerce authority. Id. at 617–19. The Court explained

that, “in those cases where we have sustained federal regulation of intrastate activity

based upon the activity’s substantial effects on interstate commerce, the activity in

question has been some sort of economic endeavor.” Id. at 611. However, in the

Court’s opinion, “[g]ender-motivated crimes of violence are not, in any sense of the

phrase, economic activity.” Id. at 613. Notably, as was the case in Lopez, the statute

                                           8
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at issue did not include a jurisdictional element. Id. Absent an express jurisdictional

hook, and given the non-economic nature of the regulated conduct, the Court struck

down the statute by “reject[ing] the argument that Congress may regulate . . . conduct

based solely on that conduct’s aggregate effect on interstate commerce.” Id. at 617.

Aggregated effects alone, in other words, cannot rescue a statue under the Commerce

Clause.

      Finally, Raich added further color. That case addressed the question of

whether the Controlled Substances Act (CSA), which prohibited the manufacture,

distribution, and possession of controlled substances, was unconstitutional as

applied to purely intrastate producers of marijuana. 545 U.S. at 5. The respondents,

who grew marijuana only for personal consumption, argued that their conduct was

non-economic and purely intrastate and, for that reason, beyond Congress’ interstate

commerce power. Id. at 6–7. The Court disagreed.

      “What the Court found important, and what distinguished Raich from

Morrison and Lopez . . . was the comprehensiveness of the economic component of

the regulation.” United States v. Maxwell, 446 F.3d 1210, 1214 (11th Cir. 2006).

Notably, the statutory provision at issue in Raich did not include a jurisdictional

element. However, the CSA did more than simply address the possession of a

firearm in certain geographic locations or target gender-motivated crimes of

violence, like the statutes in Lopez and Morrison. Instead, the CSA was far more

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robust—it established “a comprehensive regime to combat the international and

interstate traffic in illicit drugs.” 545 U.S. at 12. As the Court explained, “a primary

purpose of the CSA [wa]s to control the supply and demand of controlled substances

in both lawful and unlawful drug markets.” Id. at 19. Moreover, even the local

cultivation of marijuana could have the effect of diverting drugs into illicit channels

and thereby frustrate the federal interest in regulating the interstate market in its

entirety. Id. For that reason, the Court concluded, the regulation fell “squarely within

Congress’ commerce power because production of the commodity meant for home

consumption . . . ha[d] a substantial effect on supply and demand in the national

market for that commodity.” Id.

      The upshot after Raich is that “Congress can regulate purely intrastate activity

that is not itself ‘commercial,’ in that it is not produced for sale, if it concludes that

failure to regulate that class of activity would undercut the regulation of the interstate

market in that commodity.” Id. at 18; Maxwell, 446 F.3d at 1215 (“[W]here

Congress has attempted to regulate (or eliminate) an interstate market, Raich grants

Congress substantial leeway to regulate purely intrastate activity (whether economic

or not) that it deems to have the capability, in the aggregate, of frustrating the broader

regulation of interstate economic activity.”). In other words, “[w]here the class of

activities is regulated and that class is within the reach of federal power, the courts

have no power ‘to excise, as trivial, individual instances’ of the class.” Raich, 545

                                           10
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U.S. at 23 (quotation and citation omitted).

       With the preceding in mind, the undersigned concludes that Congress’

prohibition on the intrastate theft of firearms under § 924(m) is a valid exercise of

its interstate commerce authority. While Defendant points out that § 924(m) does

not include a jurisdictional element, that alone is not dispositive. See United States

v. Moghadam, 175 F.3d 1269, 1275–76 (11th Cir. 1999) (“[T]he absence of such a

jurisdictional element connecting the offense to interstate or foreign commerce does

not necessarily mean the Commerce Clause cannot serve as authority.”); United

States v. Olin Corp., 107 F.3d 1506, 1510 (11th Cir. 1997) (“[A]lthough Congress

did not include in CERCLA either legislative findings or a jurisdictional element,

the statute remains valid as applied in this case because it regulates a class of

activities that substantially affects interstate commerce.”).

       To put the matter plainly, this is a Raich case.3 Just as in Raich, where the

statute under consideration also lacked a jurisdictional element, Defendant here

challenges a component of a comprehensive regulatory scheme governing the

national market in a commodity—in this case, firearms. And the subject of the

regulatory scheme is decidedly economic, which in this context refers broadly, per

the Supreme Court in Raich, to “the production, distribution, and consumption of



       3
         Because the undersigned concludes that Raich controls, the ensuing discussion is guided
by the Supreme Court’s analysis in that case. See Maxwell, 446 F.3d at 1216 n.6.
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commodities.” 545 U.S. at 25.

      Section 924(m) was enacted as part of the Violent Crime Control and Law

Enforcement Act of 1994, which, among other things, imposed enhanced penalties

for certain firearms offenses. Pub. L. No. 103-322, § 110515, 108 Stat. 1796. The

underlying statutory framework was laid down with passage of the Omnibus Crime

Control and Safe Streets Act of 1968, which established federal licensing

requirements and other regulations on the nationwide traffic in firearms. Pub. L. No.

90-351, 82 Stat. 197. Section 901(a) of the Omnibus Act declared “that there is a

widespread traffic in firearms moving in or otherwise affecting interstate or foreign

commerce, and that the existing Federal controls over such traffic do not adequately

enable the States to control this traffic within their own borders through the exercise

of their police power.” Id. § 901(a)(1). Moreover, Congress determined “that only

through adequate Federal control over interstate and foreign commerce in these

weapons, and over all persons engaging in the business of importing, manufacturing,

or dealing in them, can this grave problem be properly dealt with, and effective State

and local regulation of this traffic be made possible.” Id. § 901(a)(3) (emphasis

added).

      As it did with controlled substances, Congress has for the last several decades

erected a comprehensive regulatory framework “to control the supply and demand

of [firearms] in both lawful and unlawful . . . markets.” Raich, 545 U.S. at 19. And

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that being so, to borrow (with minimal revision) the Supreme Court’s own

pronouncement in Raich, “[p]rohibiting the intrastate [theft] of an article of

commerce is a rational (and commonly utilized) means of regulating commerce in

that product.” Id. at 26. In other words, Congress could have rationally determined

that intrastate theft would undermine its comprehensive regulation of the national

firearms market. That alone is reason enough to sustain § 924(m). See id. at 19.

      Nevertheless, against the broad understanding of economic activity articulated

by the Supreme Court, Defendant argues that the specific regulated activity at

issue—namely, intrastate theft—is non-economic. The problem with § 924(m),

according to Defendant, is that it “prohibits the local theft of a firearm, which is a

non-economic or commercial activity.” (Doc. 28 at 5). Therefore, Defendant

continues, like the regulated activities at issue in Lopez and Morrison, the intrastate

theft of firearms cannot be aggregated to measure up to the substantial effects

required under the third category of Congress’ interstate commerce authority. The

undersigned disagrees.

      Property crimes—such as theft, burglary, or robbery—effect an economic

transfer, albeit an involuntary one. The criminal makes an economic gain, and the

victim suffers an economic loss. See United States v. Gray, 260 F.3d 1267, 1274

(11th Cir. 2001) (“Robbery, even though accompanied by actual or threatened

physical harm, is undeniably an economic crime that involves the involuntary

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transfer of economically valuable assets.” (emphasis in original)); United States v.

Walker, 657 F.3d 160, 179 (3rd Cir. 2011) (“Although drawing the line between

‘economic’ and ‘non-economic’ activities may sometimes be difficult, property

crimes like robbery and extortion are—unlike the possession of a gun in a school

zone [in Lopez] or gender-motivated violence [in Morrison]—indisputably

‘economic’ . . . .”). Indeed, the Federal Sentencing Guidelines categorize property

offenses like theft, burglary, and robbery as “Basic Economic Offenses.” U.S.S.G.

ch. 2, pt. B. (emphasis added).

      In any event, as alluded to above, the relationship between theft and commerce

is “clear, direct, and unattenuated.” Gray, 260 F.3d at 1274. As a starting point, under

the third category of its interstate commerce authority, Congress may regulate the

national firearms market based on the aggregate effect on interstate commerce—that

much is uncontested. See Maxwell, 446 F.3d at 1217 (upholding Congress’ authority

to criminalize the receipt, distribution, sale, production, possession, solicitation, and

advertisement of child pornography because such regulation “is just as valid an

exercise of the Commerce Clause authority as price and volume controls of an

otherwise legal market”). And with respect to that overarching interstate market, the

theft of firearms from licensed parties—even when purely local—is largely zero-

sum. It removes commodities from one market (a legal one) while supplying another

(an illegal one). See United States v. Hosford, 843 F.3d 161, 171–72 (4th Cir. 2016)

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(“[L]ike the market for marijuana, Congress has a rational basis to believe that

leaving intrastate firearm markets unregulated would affect the interstate market or

draw firearms purchased intrastate into the interstate market.”).

      From this, “it follows that Congress may . . . regulate intrastate [firearms]

theft.” Taylor, 136 S.Ct. at 2077 (emphasis in original). The reason being that, as

just described, theft directly brings about an economic, supply-side transfer of

firearms between legal and illegal markets that is unquestionably subject to

Congress’ reach. See Raich, 545 U.S. at 18; Hosford, 843 F.3d at 171–72. Congress

could thus rationally conclude that failure to regulate even intrastate theft from

licensed parties “would undercut the regulation of the interstate market” in firearms.

Raich, 545 U.S. at 18; see also United States v. Luna, 165 F.3d 316, 321 (5th Cir.

1999) (“[T]he regulation of stolen firearms is ‘an essential part of a larger regulation

of economic activity, in which the regulatory scheme could be undercut unless . . .

intrastate activity were regulated.’” (citation omitted)). And binding precedent

“firmly establishes” Congress’ authority to regulate even purely local activities—

such as Defendant’s alleged intrastate firearms theft—insofar as they are part of a

class of activities that, when considered as a whole under a comprehensive market

regulation, have a substantial effect on the targeted market. Raich, 545 U.S. at 17.

      Accordingly, given the economic nature of property crimes like theft and the

direct link between such crimes and the interstate firearms market subject to

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Congress’ comprehensive regulation, contrary to Defendant’s urging, cases like

Lopez and Morrison are “wholly inapposite” here. Gray, 260 F.3d at 1274. The

undersigned thus RECOMMENDS that Defendant’s Motion to Dismiss also be

DENIED as to his as-applied challenge.

                             III. CONCLUSION

      For all of the reasons presented above, the undersigned RECOMMENDS that

Defendant’s Motion to Dismiss Counts 14–24 of the Indictment, (Doc. 28), be

DENIED. Because there are no other pretrial motions related to Defendant Richard

Thompson pending before the undersigned, his case is CERTIFIED READY FOR

TRIAL.

      IT IS SO RECOMMENDED on this 24th day of August 2021.



                                              REGINA D. CANNON
                                              United States Magistrate Judge




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