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Keywords

statutemotiontrustantitrustfelonymotion to dismiss
statutemotiontrustantitrustmotion to dismiss

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Reyes v. Sessions

Facts

Gregory Reyes was convicted in 2010 of securities fraud and related offenses, resulting in an 18-month prison sentence. He was the CEO of Brocade Communications Systems, Inc., where he was involved in backdating stock options, leading to his convictions. Although his right to possess a firearm has been restored under Montana law, he claims that federal law prevents him from acquiring a firearm due to his felony convictions.

Eight years ago, Reyes came within the potential ambit of the felon-in-possession statute when he was convicted of certain offenses punishable by more than one year of imprisonment. From 1998 to 2005, Reyes was the Chief Executive Officer of Brocade Communications Systems, Inc. ('Brocade'), a publicly traded company. The company offered stock options to new and existing employees that gave them the right to purchase Brocade stock at a fixed (strike) price on or after a particular date. In 2010, Reyes was convicted of (1) securities fraud and making false filings with the Securities and Exchange Commission ('SEC') in violation of 15 U.S.C. 78j(b) and 78f(f), and 17 C.F.R. 240.10b-5; (2) falsifying corporate books and records in violation of 15 U.S.C. 78m(b)(2)(A) and 78f(f), and 17 C.F.R. 240.13b2-1; and (3) making false statements to auditors in violation of 15 U.S.C. 78ff and 17 C.F.R. 240.13b2-2.

Issue

Whether Reyes's prior convictions fall within the statutory exception to the federal prohibition on firearm possession by felons, and whether he has standing to challenge the statute.

Whether Reyes's prior convictions fall within the statutory exception to the federal prohibition on firearm possession by felons, and whether he has standing to challenge the statute.

Rule

Under 18 U.S.C. 921(a)(20)(A), certain offenses related to antitrust violations and unfair trade practices are excluded from the definition of 'a crime punishable by imprisonment for a term exceeding one year,' which affects the application of the felon-in-possession statute.

Under 18 U.S.C. 921(a)(20)(A), certain offenses related to antitrust violations and unfair trade practices are excluded from the definition of 'a crime punishable by imprisonment for a term exceeding one year,' which affects the application of the felon-in-possession statute.

Analysis

The court analyzed Reyes's prior convictions and determined that they could be classified under the business practices exception. It concluded that Reyes's offenses pertained to antitrust violations and unfair trade practices, thus not triggering the felon-in-possession statute. The court also found that Reyes had established an injury in fact, allowing him to challenge the statute.

The court analyzed Reyes's prior convictions and determined that they could be classified under the business practices exception. It concluded that Reyes's offenses pertained to antitrust violations and unfair trade practices, thus not triggering the felon-in-possession statute. The court also found that Reyes had established an injury in fact, allowing him to challenge the statute.

Conclusion

The court denied the government's motion to dismiss, allowing Reyes to proceed with his challenge to the federal firearm possession prohibition.

The court denied the government's motion to dismiss, allowing Reyes to proceed with his challenge to the federal firearm possession prohibition.

Who won?

Gregory Reyes prevailed in the case because the court found that he had standing to challenge the statute and that his prior convictions fell within the statutory exception.

Gregory Reyes prevailed in the case because the court found that he had standing to challenge the statute and that his prior convictions fell within the statutory exception.

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