Episode 5: The Trial

thing was absurd right from the get go. I went the first time I went to court, no idea. I'm sitting and inquired. There's like forty people or whatever sitting in this courtroom. So I look at my lawyer and I said, we gotta sit here all day and wait for all these cases to go through. He's like, what do you mean? I said, what the funk? All these people? I said, what are we gonna do? It's like, these are all the people. You don't know anybody here. I'm like, no,

I've never met any of these people. I don't wunt know what they are. I said, what are they here for? Is they're all involved in your case? I'm like, okay, no Derek, but I don't know anybody else. I had no idea who these people are. Derek's situation wasn't too different. He was being lumped in with outlaw bikers and Colombian cartel runners. He was publicly accused of running a tobacco smuggling operation alongside big time organized crime figures like Sylvan Etier,

someone Derek says he never dealt with. I had no clue. I mean, he used to show up but my restaurant, would you know, different guys just bringing them there to eat and stuff like that. But I never spoke to him. I never he He only spoke French for one and I never talked to him. But Sylvan would never face a judge because not long after the Mygale takedown at Sylvan's front door, knocked on his door and killed him

front porch. No one was ever charged with the murder, but a former Quebec police investigator told the media that he believed the Hell's Angels were responsible. My understanding of it is that this was a retribution because he had not turned over all the money that was due the bikers and organized crime. It's so in essence if let's just make up numbers. Ten lords came in, he was only giving them money on six and keeping the four to himself. So how did you react when Sylvan was murdered?

I mean, were you did you feel like anything was gonna come to you? Or well not really, I mean from what I hear that he owed people money and or he was basically I don't know if he was if he was gonna squeal on the other guys that were bringing the stuff in for him, or I don't know. I don't They didn't know much about what was what they're what, they're how their operation was working, so they

don't care. They just want to just round up as many people as they can and charge everybody and try to get as much money as they can out of everybody. But you know what happened. Look at you got fifty fifty guys and I'm the only Me and Hunter are the only ones that are fighting this because it's our right. I mean, we're gonna fight this right till the end. From day one, Derek knew he was going to fight

this case. It didn't cross his mind to roll over and plead guilty like most of the other Mohawks had been arrested on tobacco charges in the past. From as far as I can remember, tobacco and the cigarettes were coming in. There was people getting caught and going accord and this and that, but nobody really fought it. Nobody ever fought it. They would just okay, well, say you had ten cases of cigarettes in your in your trunk whatever, and they say, okay, well, UH will make you a deal.

You pay a hundred dollars a month or whatever. So everybody would take the deal, and nobody ever fought it. And I said, you know what, it's time someone you know, steps up to the plate and fight discovernment and see what happens. And I'm willing. I'm ready to go to jail. I don't care, you know, but I'm not pleading guilty. Playing and simple. They could make any offer that they want and I'm not taking it. Playing and Simple from Campside Media and Dan Patrick Productions. This is Running Smoke,

I Got great place. I'm Roger Gola and this is episode five the trial. As soon as Derek heard that he had a warrant out for his arrest, he placed a phone call to a golf buddy he'd known for years. Pure lick v l e c u y e Er. I was the defense lawyer for Derek Whaite. I met Pierre in his swinky office in downtown Montreal, and he just had one ground rule for me. If I would like the question, I won't answer simple enough. Huh. Pierre does not mess around. He's about as matter of fact

as a clerk at the d MB. Was this a total surprise to both you and Derek? Was there any indication that there was surveillance happening prior or I'm never surprised if a client is arrested, and I was aware of it because two of his runner were arrested and amounts of money were sees. I would say three or four months, six months prior to the arrest, so I knew something was cooking, But at the time Derek chalked

it up to a fluke. His suspicions were raised a bit, but the business continued for months until March when the Mohawk Peacekeepers called Derek to tell him he was wanted. Calls me, there's a warrant for his arrest. I ran down to his office, We discussed it, made sure that he would be released on bail. I found out that much the bail was to be sure that I had the money to go deposited for the bail. We waited

for the disclosure and started working the case. Disclosure all the evidence that the government had collected on Derek over the last couple of years. It was ten bankers boxes worth of intercepted phone calls, text, surveillance reports and photos. Pierre and his team had their work cut out for them. And so just from seeing the full disclosure, how strong did you feel the government's case was? Well, obviously it

was strong. When you have police officers delivering tobacco to you, I mean and one at the end stints the guy is moving to tobacco to a warehouse in Saint Jeanne. Derek is giving shipped to the guy to move faster, and the guy who was moving in as an OURCMP officer. So Derek was hit with two sets of criminal charges. The first set concerned the tax evasion he'd allegedly committed

against the provincial government of Quebec. For the provincial when the finished product, which means a cigarette, has to be so they have to prove that it's sold in Quebec territory. Well, in there's case that it wasn't because he was shipping full containers to Ontario six Nations and that's where they were producing the cigarettes and setting them there. I'm not

liable for paying the taxes or anything. If you look into the the Rules and Regulations of Revenue Canada, it states right in there do you only paid the taxes once it's manufactured and sold. So I've never manufactured any cigarettes or sold any cigarettes the actual cigarette. All I did was I was a broker of of raw tobacco Nation and nation. We knew we had a good chance of winning the provincial one, and we knew that their case was strong concerning the federal one, which brings us

to Derek's second set of charges, the federal ones. Derek was accused of defrauding the federal Canadian government, which does levy taxes on raw tobacco. The federal issue is when you enter the border, you've got to declare and pay taxes, and they were not. So that's the federal issue they're saying. It's it's a more than a billion dollars of taxes that were not paid. The big debate on these charges came down to a simple question, who was the importer.

Derek said it wasn't him, He was just the buyer. He ordered tobacco from brokers down in North Carolina and paid drivers to bring it across the border. It was on the broker and the drivers to pay those taxes. Derek claimed he only took possession of the tobacco after it is in Canada. The government, however, argued that Derek was the importer, that he had his own drivers and money runners, and that he was running a criminal organization.

And one of the people the government accused of being in Derek's criminal organization was Hunter Montour, who had walked into a courtroom full of strangers. The government claimed that Hunter had helped Derek find a warehouse in New Jersey to store his contraband, and that Hunter had helped manage those shipments. My association with the cases so far like

it was ridiculous, it still is. I referred him to this this place in New Jersey that I was told about, and I said, well, here's the guy, this is the number he's and he asked me, so can you call him? I shower, no big deal, and the eyes of the government. I didn't realize that that was something being that was something that you were doing that was illegal. I had no idea. It just couldn't wrap my head around what what they're saying I'm doing. I'm like, I'm just helping

a friend. I got the information here it is that's gangsters um. That was the charge Hunter was facing, gangsterism aiding a criminal organization. Derek felt guilty about rupping his friend into the whole mess. I could have did that myself and I couldn't. Didn't even need Hunter involved. They didn't go online and okay, well here's a where else, store it there, and then they would send their trucks

there to pick up the product and come across. Gangsterism was a steep charge, and Hunter says he was getting pressure to plead guilty, take a deal, and avoid a lengthy trial. I think it was six months with some kind of fine or something, I can't remember, and the last one was house arresting, and I told him, no, I'm not going to admit to something that I did not do. I have to. If you're saying I said, is bull, it's not even true. Said you made up have this shape, You're gonna strom me in jail, s

from me in jail. But I'm not gonna admit to something that I didn't do. Derreck and Hunter's trial took place in the Montreal court House, an imposing brutalist building sandwich between Little Chinatown and the Historic District. The proceedings were presided over by a judge in a black robe and white collar. Dereck and Pierre sat on one side of the room and on the other or the Crown prosecutors representing the Canadian government. The stage was set for

a court battle. Without further ado, let the fight begin, gentlemen, to your corners, hold on, We'll be right back. The Crown prosecutors took the floor first and presented their arguments before a jury, while Derek and Pierre listened patiently. The government's case relied heavily on the testimonies of investigators, undercover officers, and informants that participated in Project My Gale. Day after day, Crown prosecutors brought witnesses before the jury to prove that

Derek was knowingly defrauding the government. They brought out the informant who started the whole case, who we heard earlier next week. Sure I think of any your man, Thank you, you got arrested in the United States for money laundering? Is that right? And they brought out the members of the surveillance team that intercepted Derek's phone calls and texts and read them aloud. For the journey went for the s s A, the kind of up Order services agency.

I was the person that listened to the communications that were intercepted. And they brought out the undercover police officers that drove the semi trucks shut alling tobacco across the border to Derek's reservation. Next winness, you see a three three three three? Can you tell me who you work for? Right now? Uh U S Department of Homeland Security Poland Journey investigations. The Crown strategy was to show that Derek was responsible for paying the taxes, that he had violated

the Excise Act and knowingly committed fraud against the Canadian government. Derek, as far as the Crown was concerned, was an importer and in the old sailor of tobacco. So the proof showed us that he had one big client, which was Jason Lee of Six Nations, and when tobacco would get to Gnawaugue, then it would be shipped to sixth Nations by one of Derek's drivers, and he wouldn't make the

profit on the sale of the tobacco. One way the government tried to prove Derek's wrongdoing and deliberate fraud was his alleged use of code words word like pizza dough, moose meat, racing tires, golf clubs. One of the cool words is the pizza will be ready for Friday, for example. It was nothing very complicated. So you put this, and you put the fact that Friday there was a deliver at to back when the sixth nation. You put two and two together and that's nothing very complicated. But Derek

had an explanation for those code words. What does pizza dough mean by sell pizza? It was it started off it was pizza that I was bringing from this. They never mentioned about the cheese or stuff like that, sauce because everything we bring in is mostly from the States, so it kind of started from there. I think the government just use that as proof that you were speaking in code. Yeah, whatever, the moose meats in the cooler I was buying Actually I was buying moose meat from Hunter.

So a lot of the conversations that we're doing here, even here under reserve. They suspected that it was tobacco, but which we do sell all these kind of you know, all these kind of things that we're talking about, the pizza, the meat. I have a butcher shop, you know, I have a pizza restaurant, everything, So they thought we were talking about tobacco, but really it was actual food. To be perfectly honest, when I asked Derek about those code words,

I hadn't actually heard the phone tape or text. All he had were local media reports, and I really did think Derek was telling the truth. This was just the way that folks in Gottawage talked, and if you take anything out of context, it's gonna look bad. But a few months later we got the tapes from the trial, and the code words, well they started sounding a little less innocent. I'm sending moost meat soon period. Tell the

old man it's O D one period. Pezza truck wrote down hopefully Tuesday or Wednesday, t will be there for lunch. There was so much coded language that even the undercover police got confused. In one operation, an undercover truck driver accidentally picked up a load of salt instead of tobacco because he didn't use the right code word at the warehouse. Once I'd heard the tapes, I had to ask Derek about it again, and his answer was a bit different

than what he'd said originally. I don't know. I guess it's kind of uh make makes a little bit more exciting if you are again, uh, you don't know if those guys are being uh, you know, watched or what. So that's you know, that's how they that That's the way they they do everything is they use cold words, and so I just followed what they say. Derek was

admitting that, yes, he did use the code words. They made the whole thing feel like a movie, and more importantly, it was the way his truck drivers and brokers spoke. Derek was just following their example. But the fact that he used code words doesn't make him a criminal. Being shady isn't a crime. Derek has rights as a native person. The way he sees it, he doesn't have to pay taxes to the Canadian government, especially on something as traditional

as tobacco. He says. The fact that he's using code words and trying to do things under the radar is because the government refuses to acknowledge his rights. They won't let us exercise our rights. They think we're criminals. They want to make us look like criminals and their eyes were doing something wrong, But in our eyes, it's what we were. Um. I was brought up in this in the tobacco trade with my grandmother. So from as far as I remember, this is all legal stuff, you know.

So if I pulled up at the border coming from the States and m yeah, I got a trunk full of tobacco, They're gonna arrest me. They just they put their own boarder there. They put their own taxes on the cigarettes and stuff like that. It's for the government's Uh, they're dire the only one that's benefiting from it. But this wasn't a trial over indigenous history and constitutional rights.

It was a criminal trial over tax evasion. It was being heard in a courthouse based on Canadian laws and procedures, not Mohawk ones. Despite Derek's firm belief that he was in the right, it would ultimately be up to a jury to decide, and after months of hearing arguments from both sides, that jury was finally ready to present a verdict. That's after the break jury we even told that pronounced

your verdict. Yes, so Mr White, Mr Derek White, and Mr aunt Montal to send up, ladies and gentlemen, o the really will speaking on it will be all the members of the injury and agreement on their verdict. Yes, yes, so there White because conspiracy to their crotic government can get it. I've gotten Ober five. So there White probed against the government to then when you're building it's not on council conspiracy to defraud the government of Quebec and

of committing fraud against the Government of Quebec. Derek White was found not guilty. He had beaten the provincial charges. And remember Derek's lawyer getting all excited and pumping his fists and it was was really happy. So I'm like, well, that's to be a good thing. I mean, we were very confident in winning the provincial side because they got approved that the manufactured products are sold true Quebec and their evidence was very weak, so we got that part.

The provincial government of Quebec only levied taxes on finished products manufactured cigarettes, and Derek only ever sold wholesale raw tobacco. The government couldn't prove that he actually owed the forty four million dollars in taxes that they claimed he did, and the jury took Derek's side, and if we were

very lucky, would have won everything. Unfortunately, Derek still had federal charges hanging over his head, the small issue of five hundred million dollars innovated taxes owed to the federal government of Canada. So oncou number one from some Derek white top skating con activities of a criminal organization? What is your guilty I'm talking about to mister n Termoto, facilitating the activities of criminal organization? What is your real guilty?

I'm coming abo three. So they required conspiracy to defer the government of Canada. What is your limit guilty? Thank you? After hearing the slew of evidence on the structure of Derek's organization and the involvement he had in the tobacco shipments, the jury had decided that Derek was indeed the importer, which meant it wasn't the broker's or the driver's responsibility to pay taxes at the border, it was Derek's. I thought, for sure, we're going to get off on both, you know,

federal and provincial. Was just shocked at we were found guilty on the federal site because it's basically the same argument. It's the same thing. You know, I didn't drive the fucking truck across the border. All I did was when the product got here, I would just send the money. So it's delivered to the reserve. It's pax free. Hunter had also been found guilty of a gangsters in charge

of aiding Derek's criminal organization. Together, they were looking at years in prison, but Derek had a planned for this which had been set in motion months earlier. It was a plan that would keep him out of a jail cell and postponed sentencing. More importantly, it was a legal option that would allow him to argue his native rights before a judge. Derek was going to file a constitutional challenge Tuesday before. We don't have any anything to sip

because it's been all scheduled for the constitutional challenge. Thank you very much, and we will come and so I'll see you in June. Like from day one, we knew that our second step was to go to challenge the constitutional issue, so we had all rehired the constitutional lawyer. In all this, Derek was going to fight his federal charges on the grounds of the Canadian Constitution. Itself. He wasn't trying to prove that he didn't bring tobacco across

the border without paying taxes. He was going to try to prove that the tax laws didn't apply to him and that trading tobacco tax free was his right as a Native person. No tobacco case had ever come as far in the Canadian legal system. And what are the implications of this case if they win or lose. If they win, and basically bacco trade will be legal for walks, they won't need they won't need permits from the federal or provincial governments, and they'll be able to deal into tobacco.

If Derrick loses, then it's he's gonna have to face the sentence and go to jail. Well, why should I plead to something that uh, I've I think that it's um, I'm not doing anything wrong. I mean, we're exercising our rights as Native people. Then we'll see who's ready to keep fighting and go on how far you want to go. It's not about standing in the tree line and trying to scare army guys. This is a this is the way things are done now. This is the fight tobacco.

Who is our is our trade. I mean, like I said, it's still going on today and it's not gonna stop. I mean, it's tobacco. Who it's our rights. We're gonna continue selling tobacco and they ain't gonna stop us. It seems like you don't, you know, put a lot of stock in his argument that he's standing up for Native rights in this I won't be right to say, don't add that. Jimmy the anonymous investigator who worked on My Gil.

It makes my skin crawl when I hear people say there's some kind of Native America in warrior, some kind of social Native American warrior. They're doing it for the fucking money, period, end of story. Yeah, he's not Robin Hood. He's not getting money from the rich guys and giving it to the poor. That's a social hero, not some asshole who pays people organized crime figures and and Hell's

Angels and people to smuggle across the border. He was increasing his wealth and the tribe saw nothing from it. So when he makes representations that he's some kind of warrior, you know what, I disagree. Derrick White and other natives like that would have my respect if they drove down to North Carolina and bought a tractor trailer load of tobacco under their own name, with a good bill of lading,

and drove to Canada. And when they got to the Canadian Border Services and the agent at the border said, what do you got back there? If Derek White would have looked at that agent and said, I have cut rack tobacco. Here's my bill of lading showing I paid for cut reck tobacco. I'm taking it to my own licensed facility or my friends on licensed facility where I'm gonna sell it and it's gonna be made into cigarettes. And if you've got a problem with that, let's talk

about it in court. Because I think I got it right through this, just like every other Native American does. I would respect that. That's not what he fucking did. It turns out, though someone did do that thirty years ago. He followed all the rules and launched a case against the government, even took it all the way to the Supreme Court. It was supposed to be a landmark case for Native rights, and then he got screwed next time.

On running smoke, It's like playing a game of cards with somebody and they just decided we're going to change the rules so they can win. It was a dumb case. I never should have been argued before the court. He thought he was going to be very savior. Just no other way to fight it. And what else you're gonna do. You're not gonna have a war over it because we're not gonna win. We have to fight in a system that inherently has waited against us, and we have no choice.

Every time, every every court case, the government always won. Running Smokes the production of camp Site Media, Dan Patrick Productions and Workhouse Media. The series was written and reported by me Roger Goa. Our producers are Lea Papes, Laine Gerbig, and Julie Dennische. Our editors are Michelle Lands and Emily Martinez. Sound designed and original music by Mark McAdam, additional sound and mixing by ewen Lyone from you In. Additional reporting

by Susie McCarthy. Our executive producers or Dan Patrick, Josh de New Camp Said Media, Paul Anderson, Nick Pnella and Andrew Greenwood for Workhouse Media. Fact checking by Mary Mathis, artwork by Polly Adams, and additional thanks to Greghorn, Anny Kaufman, Sierra Franco, Elizabeth van Brocklyn and Shawn Flynn MHM