Justia U.S. 5th Circuit Court of Appeals Opinion Summaries

Defendants Gladstone and Jacqueline Morrison appeal their convictions for conspiring to submit fraudulent tax returns, aiding and abetting the filing of numerous false returns, and wire fraud in connection with the attempted sales of the business. The court concluded that the evidence supports all of Gladstone's wire fraud convictions; the district court did not commit reversible error in limiting Jacqueline's testimony; the instances of bias alleged by Jacqueline, alone or taken together, do not rise to the level at which recusal is required; and the court rejected Gladstone's challenges regarding the conduct of the trial judge. Finally, the court rejected Jacqueline's additional claims of error. Accordingly, the court affirmed the judgment. View "United States v. Morrison" on Justia Law

Defendant appealed his conviction and sentence for multiple counts of bank fraud and related offenses. The court concluded that defendant has not cited any authority recognizing his proposed exception to Franks v. Delaware, and the court declined defendant's invitation to create a new exception to well-established Supreme Court precedent; the district court did not abuse its discretion in applying a six-level enhancement under USSG 2B1.1(b)(2)(C) for an offense committed with over 250 victims; the district court did not err by applying an eighteen-level enhancement under section 2B1.1(b)(1)(J) because the district court's calculation that defendant's total intended loss was between $2,500,000 and $7,000,000, was not unreasonable; and defendant's request for remand is foreclosed by United States v. Garcia-Carrillo. Accordingly, the court affirmed the judgment. View "United States v. Minor" on Justia Law

Defendant appealed his conviction and sentence for sixteen counts of wire fraud under 18 U.S.C. 1343. Defendant's conviction stemmed from his involvement in a scheme to obtain government procurement contracts set aside by the Small Business Administration for minority-owned small businesses. The court concluded that sufficient evidence supports the convictions. However, the court concluded that government contracts awarded through an affirmative action contracting program are not “government benefits” under USSG 2B1.1 cmt. n.3(F)(ii), such that procurement frauds involving those contracts are properly treated under the special government benefits rule for loss calculation rather than under the general rule. Therefore, the district court should have applied the general rule for loss calculation in this case. The court concluded that the loss amount should have reflected not the total contract price, but rather the contract price less the fair market value of services rendered by the Joint Venture to the procuring agencies. By treating the entire face value of the contracts as loss for purposes of section 2B1.1 and not deducting the fair market value of services rendered by the Joint Venture, the district court procedurally erred in calculating the Guidelines range in this case. Accordingly, the court vacated the sentence and remanded for resentencing. View "United States v. Harris" on Justia Law

Defendant was convicted of one count of conspiracy to commit health care fraud, seven counts of health care fraud, and seven counts of aggravated identity theft. Defendant was sentenced to 135 months' imprisonment and ordered to pay $599,128.02 in restitution. The court concluded that there was sufficient evidence to convict defendant of the charges, and the district court did abuse its discretion in denying defendant's motion for a new trial without first holding an evidentiary hearing where defendant's arguments rest on either non-exculpatory testimony or conclusory assertions. However, the court concluded that the district court abused its discretion by calculating the total loss suffered by the victims because the district court procedurally erred by failing to credit defendant for the fair market value of legitimate health care services that his hospitals rendered to patients. Therefore, the court vacated defendant's sentence, as well as the restitution order. The court remanded for resentencing. View "United States v. Mahmood" on Justia Law

Defendant, in an attempt to shield a residential property from foreclosure, transferred his assets through two entities and caused three bankruptcies to be filed. The district court convicted defendant of bankruptcy fraud in violation of 18 U.S.C. 157(3). The court rejected defendant's claims regarding constructive amendments to the indictment, concluding that defendant's conviction was based on the 2007 scheme to defraud alleged in the indictment and not a different or broader scheme; the district court did not plainly err in formulating the elements of the bankruptcy fraud conviction; and the district court’s formulation of the indictment’s misrepresentation did not constructively amend the indictment, and there is no plain error. Finally, the court concluded that the evidence was sufficient to convict defendant and the district court's findings are supported by substantial evidence. Accordingly, the court affirmed the judgment. View "United States v. Chaker" on Justia Law

Jason Dvorin appealed his conviction of conspiracy to commit bank fraud. Dvorin's appeal has been consolidated with the appeal of Mindy Sauter, the attorney who prosecuted defendant during his first trial. Dvorin asserted that the district court erred in: (1) denying his request for an apparent-authority jury instruction; (2) denying his request for a special unanimity jury instruction; (3) overruling his objections under Federal Rules of Evidence 701 and 704 to the government counsels’ and witnesses’ use of the terms “fraud,” “fraudulent check,” or “conspiracy”; (4) excluding extrinsic evidence of and cross-examination regarding the district court’s findings that Chris Derrington, Pavillion Bank's executive vice president, testified falsely in a prior proceeding; (5) declining to award sanctions for prosecutorial discovery misconduct; (6) admitting the testimony of Chase Bank representative Arthemis Lindsay despite the government’s failure to timely designate Lindsay as a possible witness on its witness list; and (7) permitting the government to add a forfeiture count to the second superseding indictment before the second trial and entering a forfeiture judgment at sentencing without having a jury find the facts essential to that judgment. Sauter contends that the district court erroneously found that she violated Brady, Giglio, and Napue and acted “recklessly” by failing to timely disclose Derrington’s plea agreement supplement. The court reversed the district court’s denial of Dvorin’s motion to dismiss the forfeiture account for prosecutorial vindictiveness because the presumption of vindictiveness applied in this case where the government added a forfeiture notice in the second superseding indictment, and the government failed to overcome this presumption. The court affirmed in all other respects. View "United States v. Dvorin" on Justia Law

Defendant pleaded guilty to an offense related to a scheme to defraud the DOE and the district court ordered each defendant involved in the scheme to pay restitution. On appeal, defendant challenged the district court's denial of the Government's proposed application of restitution payments to a codefendant (Otto). The court concluded that a more appropriate mechanism for the court to apply is a hybrid approach to restitution payments where multiple defendants are held liable for injuries caused by a common scheme. In this case, the district court’s concern - that requiring payment from Otto would render both Otto and another codefendant (Reed) responsible for restitution in excess of the loss attributable to their conduct - is misplaced. Payments requested by the defendants encompass overlapping injuries due to each defendant's conduct. The court concluded that any funds received by the defendants should be applied to the total sum owed by all defendants. In doing so, payments from Otto would also reduce the overall sum owed by defendant. Further, the district court's analysis similarly does not align with the Mandatory Victim's Restitution Act's (MVRA), 18 U.S.C. 3663A, rules regarding liability apportionment. Accordingly, the court reversed and remanded. View "United States v. Sheets" on Justia Law

In 2006, Boyd sent his income and expense information for 2004 to a tax specialist, who prepared a return showing a tax liability of over $27,000. Boyd did not file the return he received from the tax specialist. Instead, Boyd filed his tax returns for 2004, 2005, and 2006 in October 2007, having recently read a book called Cracking the Code, which espoused a theory that federal income tax obligations applied only to individuals who earned income working for the federal government. The three returns declared that in those years he had zero income and zero tax liability. During those three years, Boyd actually had continued the work he had done in prior years and had earned income totaling $795,000. Convicted under 26 U.S.C. 7206(1), Boyd argued that the government had not proven willfulness because it failed to show the absence of a good-faith belief that the he did not have to file returns or pay taxes. The Fifth Circuit affirmed, rejecting challenges to denial of funding for neuropsychologist testimony, admission of uncharged conduct, the prosecutor’s statements, the judge’s statements, the jury instructions, the response to a jury note, and the sufficiency of the evidence. View "United States v. Boyd" on Justia Law

Defendant, convicted of making false statements regarding a credit application, appealed his sentence and order of restitution. Defendant forged the signatures of borrowers on an application for modification to a loan related to a certain property. Because the district court neither made factual findings concerning defendant's conduct nor explained which statutes defendant violated, the court was unable to determine whether defendant's dealings with the home buyers and sellers were criminal. The district court made no findings of fact as to whether defendant's dealings with the home buyers and sellers were part of the same common scheme or whether his criminal acts must have actually caused these losses. Further, the district court erred by awarding restitution based on relevant conduct that went beyond defendant's offense of conviction. An award of restitution based on losses not resulting from the offense of conviction is an error that is clear and obvious. In this instance, the error resulted in an award of more than half a million dollars against defendant. Accordingly, the court reversed defendant's sentence and restitution award and remanded to the district court for resentencing. View "United States v. Benns" on Justia Law

Defendant, a licensed physician who operated an in-home physical therapy services provider for Medicare patients (CMPM), appealed her conviction for ten counts of healthcare and Medicare fraud arising out of her operation of CMPM. The court affirmed the district court's denial of defendant's motion to dismiss the indictment where the district court properly recognized the independent factual basis that existed to clearly state an offense in the indictment, mooting the need to address defendant's rule of lenity/ambiguity challenge; affirmed the district court's denial of defendant's motion in limine to exclude evidence regarding her license because it was irrelevant, and exclusion of certain articles and Medicare regulation changes because they were not available to defendant to rely on at the time of her fraudulent conduct; the district court did not err by denying defendant her constitutional right to be present at all critical stages of her trial; and the district court did not err in denying defendant's motion for a new trial based on ineffective assistance of trial. Accordingly, the court affirmed the conviction. View "United States v. Thomas" on Justia Law