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September 30, 2014 CJS: Around the Circuit

U.S. Court of Appeals for the Fifth Circuit

A quarterly case summary digest of recent federal circuit court opinions

by Michael D. Dean

United States v. Traxler, No. 13-30681 (5th Cir. Aug. 22, 2014)

Defendant used her employer’s company credit card to make personal purchases. A credit card statement containing the charges was ultimately sent by U.S. mail to Defendant’s employer. Defendant’s employer paid several statements before discovering the fraud.

Defendant was charged with mail fraud in violation of 18 U.S.C. §1341. Defendant moved to dismiss claiming that the United States lacked jurisdiction because the “mailing” alleged was a routine statement from the credit card company and not a mailing that Defendant was personally responsible for. The district court denied Defendant’s motion. Defendant pled guilty reserving the right to appeal the denial of her motion to dismiss.

Held: The Fifth Circuit affirmed under de novo review. The mailing element is met when a defendant’s use of the mails is part of an ongoing scheme. This is so even when a defendant did not personally effectuate the mailing, but relies on multiple routine mailings through a third party to accomplish the fraud.

To prove mail fraud, “the government must show: (1) a scheme to defraud; (2) the use of the mails to execute the scheme; and (3) the specific intent to defraud.” Of these, only the second element was in dispute. With regard to this element, “use of the mails ‘need not be an essential element to the scheme.’” It is enough that the mail was ‘incident to an essential part of the scheme’ or ‘a step in [the] plot.’ The element is met when a defendant acts knowing that mail will follow in the ordinary course of business, or the use of mail can reasonably be foreseen. Although Defendant cited the SCOTUS case of Parr v. United States, 363 U.S. 370 (1960)—a case that strongly supported her position—the Fifth Circuit felt bound to its “rule of orderliness.” This rule requires a Fifth Circuit panel to honor the past decisions of other panels, even when the present panel strongly disagrees. Relying on its own precedent in United States v. Mills, 199 F.3d 184 (5th Cir. 1999), the Court reasoned that Defendant’s repeated reliance on the payment of statements mailed to her employer in order to continue her fraud supported the mailing requirement. This could be distinguished from Parr where the defendant made only one fraudulent credit charge.

United States v. Vasquez, No. 12-41194 (5th Cir. Sept. 3, 2014)

Defendants Vasquez and Echeverria were charged with conspiracy to possess methamphetamine with intent to distribute under 21 U.S.C. §§ 841(a), 846. The charge was based on a third person’s attempt to sell five kilograms of the substance to a police informant. Neither Vasquez nor Echeverria were directly involved in the attempted sale; however, evidence pointed strongly to both defendants’ involvement with coordinating and organizing the transaction.

Vasquez and Echeverria were tried together in two different trials. During the first trial, both defendants elected to testify and were subject to cross-examination by their respective counsel. This trial resulted in a “hung” jury. Prior to the second trial, additional incriminating evidence surfaced. Specifically, a fellow inmate named Sanchez-Alvarez testified that Echeverria had confessed to him that both he and Vasquez participated in the conspiracy. During the second trial, neither Echeverria nor Vasquez testified; however, Sanchez-Alvarez was called to testify regarding the confession. Vasquez was not able to cross-examine Echeverria regarding his confession. Both defendants were convicted and appealed jointly. Echeverria alleged, inter alia, that the evidence was insufficient to support his conviction. Vasquez alleged, inter alia, that the Court’s admission of Echeverria’s confession was contrary to Bruton v. United States, 391 U.S. 123 (1968).

Held: As to Echeverria, his confession to a fellow inmate was admissible as a non-hearsay admission by a party opponent, thus giving significant support for his conviction. With regard to Vasquez, Echeverria’s confession was not “testimonial” and therefore not subject to exclusion based on the Confrontation Clause.

The Court did not go into great detail regarding Echeverria’s confession’s admissibility as to him. The Court merely noted that Echeverria’s jailhouse confession was non-hearsay under Rule 801(d)(2)(A), admission of a party opponent. The Court analyzed the admissibility of the confession as to Vasquez more closely. Vasquez’s argument was that “his conviction violates the Confrontation Clause because Echeverria’s ‘confession naming him as a participant in the crime was introduced at [the] joint trial’ through a third-party witness… without any opportunity to cross-examine the actual declarant….” The Court held that Bruton applies only to statements that are “testimonial” under Crawford v. Washington, 541 U.S. 36 (2004). Statements made from one inmate to another are not testimonial under the Crawford analysis (such statements are not being obtained by the government with the primary purpose of developing evidence for a later prosecution). The Court noted that its holding was consistent with similar holdings from the Third and Fourth Circuits. In addition, the First, Second, Sixth, Eighth, Ninth, and Tenth Circuits have also limited Bruton to testimonial statements. Thus, Echeverria’s confession was not conditioned on (1) the unavailability of Echeverria to give direct testimony, and (2) a prior opportunity for Vasquez to cross-examine Echeverria regarding his statement.

United States v. Guerrero, Nos. 13-50376, 13-50379 (5th Cir., Sept. 11, 2014)

Defendant joined the Mexican Mafia at age 16. Defendant was quickly promoted and, by 17, was in charge of all operations in Uvalde, Texas. Shortly before his 18th birthday, Defendant ordered a home invasion of a local drug dealer who was not paying his required percentage of revenue to the Mexican Mafia. Mendez was an individual who participated in the home invasion at Defendant’s order. Defendant later became suspicious that Mendez was cooperating with authorities in the investigation regarding the home invasion. Consequently, Defendant sought, and was granted, permission to murder Mendez. The murder occurred several months after Defendant turned 18.

Defendant was ultimately charged with various offenses including a RICO conspiracy. The government used Mendez’s murder as one of the RICO predicates. During the course of its investigation, the government obtained historical cell site information from a cell phone attributed to Defendant. The information indicated that Defendant made several calls shortly after Mendez’s murder. The information also indicated the location of Defendant at the time of the murder and the route he followed shortly after. This placed him in the area of the murder during the relevant time.

Defendant was ultimately convicted. He appealed alleging, inter alia, that the district court erred when it failed to suppress the cell site data from evidence, and that the federal government did not have jurisdiction over him because his conspiracy began when Defendant was only 16.

Held: The exclusionary rule was not a remedy to the government’s violation of the Stored Communications Act. Thus, the district court did not err when it failed to suppress the cell site evidence. In addition, the district court did have jurisdiction over defendant even though he was only 16 when his conspiracy began. Defendant continued to act in furtherance of the ongoing conspiracy after he reached 18.

Defendant claimed that the exclusionary rule should apply to data the government obtained revealing ‘the antenna tower and sector to which [a] cell phone sends its signal. Defendant asserted that such information was only available to the government from third party communication providers. The Court noted that the procedure the government must follow to obtain these records is governed by the Stored Communications Act. This act requires that the government first obtain a court order supported by ‘specific and articulable facts showing that there are reasonable grounds to believe that the contents of a wire or electronic communication, or the records or other information sought, are relevant and material to an ongoing criminal investigation.’ 18 U.S.C. § 2703(d). In this case, the government conceded that it failed to follow this mandate. However, the Court noted that suppression is not an available remedy. § 2707(b) limits remedies to damages, attorney’s fees, and other litigation costs.” Thus, Congress chose to exclude other possible remedies.  In addition, the Court noted that Circuit precedent holds that “cell phone users voluntarily convey information to their service providers and… ‘understand that their service providers record their location information when they use their phones….’” (citing In re Application of the U.S. for Historical Cell Site Data, 724 F.3d 600 (5th Cir. 2013). Thus, the Court held, Defendant did not have a reasonable expectation of privacy in his cell site records.

The Court also held that Defendant’s jurisdictional complaint was foreclosed by precedent.  Specifically, Defendant claimed that the district court did not have subject matter jurisdiction over his RICO conspiracy charge because the Juvenile Justice and Delinquency Prevention Act limits the ability of the government to try a juvenile (defined as “a person who has not attained his eighteenth birthday.”). The Court noted that the act’s protections apply to defendants who committed their crimes prior to age 18 unless the indictment is returned after the defendant has reached 21. Here, the government conceded that Defendant was under 18 when the conspiracy began and that the indictment was returned before he turned 21. However, United States v. Tolliver, 61 F.3d 1189 (5th Cir. 1995) held that a defendant who was a juvenile when a conspiracy started may still be tried as an adult if the government can show that the defendant “ratified his involvement in the conspiracy after reaching majority.” Ratification means that a defendant continues to participate in a conspiracy after reaching 18.

Here, Defendant ratified his involvement. Four of the six RICO predicates alleged occurred after Defendant turned 18.

United States v. Rodriguez-Lopez, Nos. 12-41177, 13-40559 (5th Cir. Jun. 25, 2014); 756 F.3d 422

Defendants Rodriguez-Lopez and Barron were each charged with conspiring to distribute marijuana. The facts supporting the charges revealed that Defendants each played a role in a large marijuana smuggling operation responsible for moving thousands of kilograms from Mexico to cities in northern Texas. Defendants had completely different roles in the conspiracy. Rodriguez-Lopez was responsible for running one of three stash houses located in a northern Texas town. Rodriguez would receive marijuana at the house, weigh and package the marijuana, and take first pick of which marijuana in he wished to distribute. Rodriguez-Lopez also kept ledgers reflecting different “accounts”—purchasers of the product.

Conversely, Barron provided firearms to the cartel. To do so, Barron met with the cartel leader’s closest lieutenant, Gomez. Gomez contacted Barron to arrange a purchase for military-style weapons needed to support a “war” with another cartel. Barron reached an agreement with Gomez on four separate occasions. During the first transaction, Barron took the firearms to the Mexican border to make the exchange. Barron knew that Gomez was in the drug business and the two spoke openly about their careers. After these transactions, the Government successfully recruited one of Barron’s “straw men”—Flores—to work as an informant. Flores was responsible for making firearm purchases on behalf of Barron so that Barron could later sell them.

Defendants both went to trial on the conspiracy charge; both were convicted. Defendants pursued separate appeals. Rodriguez-Lopez argued, inter alia, that the government had not established venue. Barron argued, inter alia, that the evidence was insufficient to link him to a marijuana conspiracy when all he did was sell firearms to the cartel. Barron also argued that he should not have received a three-level sentencing enhancement for having a “managerial or supervisory role” in the conspiracy.

Held: Venue was proper for Rodriguez-Lopez in the Eastern District of Texas when a reasonably foreseeable overt act was committed by a co-conspirator within that jurisdiction. Evidence was sufficient to link Barron to the conspiracy when a reasonable juror could infer that Barron knew his firearms sales were made to support the cartel’s ongoing operations. However, Barron’s three-level enhancement for having a managerial or supervisory role was improper. Although Barron solicited and directed Flores and others to purchase firearms, there was no evidence that those purchases were for firearms sold to the cartel.

The U.S. Constitution grants defendants a right to be tried in the district “wherein the crime shall have been committed.” Venue is proper in any district where the conspiracy agreement was formed or where an overt act in furtherance of the conspiracy took place. This means that venue may be proper in districts where the defendant never personally set foot. This is because a “conspirator is liable for ‘all acts committed by [co-conspirators] in furtherance of the conspiracy, including those acts committed without his knowledge before he joined the conspiracy.’” The evidence in this case demonstrated that a co-conspirator hauled drugs through towns in the Eastern District before they arrived in the northern town where Rodriguez-Lopez resided. “One co-conspirator’s travel through a judicial district in furtherance of the crime… establishes venue as to all co-conspirators.”

As to Barron’s sufficiency challenge, the Court examined the following two elements to determine whether Barron aided and abetted the conspiracy: (1) whether the offense of conspiracy occurred and (2) whether “Barron associated himself with the venture, participated in it as something he wished to bring about, and sought by his action to make it succeed.” Barron did not contest that a conspiracy existed and the government did not contend that Barron was moving, packaging, or selling marijuana. The only issue was whether Barron had the requisite knowledge and participation in a drug operation. In support, Barron argued that Gomez never told him that the firearms were being purchased to support the ongoing drug operation. The Court held that a jury could reasonably infer such knowledge. Barron transported the firearms to the Mexican border and knew that his trafficking business was illegal. A rational jury could conclude that Barron’s illegal action could establish Barron’s knowledge that his buyer was similarly engaged in an illegal operation. The “unlawfulness of the goods themselves is ‘important in terms of both the seller’s knowledge of the buyer’s intended use, and the seller’s intent to promote and cooperate in the illegal action.’” The Court also noted that firearms are necessary for the success of a drug business and needed to protect its product.

Finally, the Court found that the district court erred in applying a three-level sentencing enhancement for Barron’s role as a manager or supervisor within the conspiracy. The district court relied on Barron’s employment or recruitment of Flores and others to purchase firearms as straw men. This was done so that Barron could acquire a large number of firearms without drawing attention to himself. Although Barron perhaps had some managerial control over Flores, there was no evidence that Flores or any other straw buyer was used during the time that Barron was dealing with Gomez. Flores did not begin cooperating until after the sales to the cartel were made.

Michael D. Dean is a deputy prosecuting attorney for the 17th Judicial Circuit of Indiana. Michael serves as co-chair of the Young Lawyers Committee of the Criminal Justice Section. In addition, Michael is a member of the Editorial Board for Criminal Justice magazine, as well as a member of the Book Publication Board for the Section.

Copyright (US) 2014, by American Bar Association (ABA).  All rights reserved except those specified herein.  The ABA grants permission for portions of this digest to be downloaded and copied for educational, informational, noncommercial purposes, provided that any published portion of the digest includes the legend “Reprinted by permission of the American Bar Association.”

This case summary digest was promulgated by the Criminal Justice Section’s Young Lawyers Committee.  Any interpretations of the statutes, regulations, or other law cited; or regarding the courts’ opinions as to the legal issues addressed, are those of the authors and do not necessarily represent the official views of the American Bar Association.

The information provided in this digest is solely for educational and informational purposes, and does not constitute legal advice.  While every effort is being made to ensure that the case law is correct and current, this digest is published on a quarterly basis.  Because the areas of the law being examined are complex, voluminous, and constantly changing, users are cautioned to research and verify the accuracy of the summarized information independently and through an official source.  Links to the official webpage containing the original opinions for each federal circuit are provided with each summary.  Also, the status of the law as to any particular issue may vary from one circuit to the next.  Consequently, users are further cautioned to cross-reference a circuit’s holding with the case law from the user’s own jurisdiction.  The ABA takes no responsibility for any harm resulting from reliance on this digest.