United States v. Euneisha Hearns
2017 U.S. App. LEXIS 365
| 5th Cir. | 2017Background
- Defendant Euneisha Hearns, a mortgage loan officer, was convicted by a jury of one count of conspiracy to commit bank fraud (18 U.S.C. § 1349) for submitting a materially false loan application that led Countrywide to issue a mortgage on 4006 Brownstone Ct., which later defaulted.
- Indictment alleged the conspiracy ran from June 11, 2008 to July 1, 2008 and identified Countrywide as a "financial institution" insured by the FDIC.
- The PSR attributed total losses of $865,940.18 to the conspiracy, aggregating losses from the Brownstone transaction plus nine other properties; Hearns objected and argued loss should be limited to $180,235.45 (Brownstone only).
- District court adopted the PSR, applied USSG § 1B1.3 relevant-conduct principles, set Hearns’s total offense level at 23 (base 21 + § 3B1.3 two-level increase), and sentenced her to 46 months imprisonment with restitution of $180,235.45.
- On appeal Hearns raised: an Ex Post Facto challenge (arguing Countrywide did not qualify as a financial institution under the 2008 statutory definitions), a constructive amendment claim (jury not instructed to find Countrywide was a "mortgage lending business"), and a Guidelines loss-amount challenge.
- The Fifth Circuit affirmed the conviction, rejected the ex post facto and constructive-amendment claims, but held the district court clearly erred in relying on the PSR to include loss amounts from six properties lacking sufficient indicia of reliability; the sentence was vacated and remanded for resentencing.
Issues
| Issue | Hearns' Argument | Government's Argument | Held |
|---|---|---|---|
| Ex Post Facto: whether conviction applied a post-2008 definition of "financial institution" retroactively | Countrywide was not a "financial institution" under 2008 definitions, so convicting her was ex post facto punishment | Indictment and evidence showed Countrywide was an FDIC-insured depository institution in 2008; no retroactive law applied | No ex post facto violation; conviction affirmed |
| Constructive amendment: whether jury instructions shifted an element by not requiring "mortgage lending business" finding | Jury should have been required to find Countrywide was a "mortgage lending business" | Indictment and trial relied on pre-2009 statutory definitions; court instructed using FDIC-insured definition | No constructive amendment; court did not err |
| Loss amount under Guidelines: whether district court properly attributed $865,940.18 in losses via § 1B1.3 relevant conduct | Loss should be limited to Brownstone ($180,235.45); PSR aggregation unreliable | Government argued other transactions were relevant conduct and foreseeable as part of the conspiracy | Court found clear error: six properties lacked sufficient evidentiary basis in PSR; sentence vacated and remanded for resentencing |
| Preservation/Standard of Review: whether Hearns preserved her relevant-conduct objection | Objection to PSR and request to use Brownstone loss preserved the argument | Government contended some arguments not preserved | Court held objection was sufficient to preserve the relevant-conduct challenge; review for clear error applied |
Key Cases Cited
- United States v. Hickman, 331 F.3d 439 (5th Cir. 2003) (plain-error test for forfeited constitutional claims)
- United States v. Ocana, 204 F.3d 585 (5th Cir. 2000) (preservation of sentencing objections to PSR)
- United States v. Bernegger, 661 F.3d 232 (5th Cir. 2011) (PSR must have sufficient indicia of reliability; bald assertions not enough)
- United States v. Mateo Garza, 541 F.3d 290 (5th Cir. 2008) (district court must make specific findings as to scope of conspiracy for relevant-conduct attribution)
- United States v. Reasor, 541 F.3d 366 (5th Cir. 2008) (PSR is generally reliable evidence for sentencing but can’t rest on bare assertions)
- United States v. Locke, 643 F.3d 235 (7th Cir. 2011) (remand for resentencing may lead to same outcome if district court makes adequate findings)
- United States v. Marmolejo, 139 F.3d 528 (5th Cir. 1998) (scope of issues on remand limited to correction ordered by appeals court)
- United States v. Cooks, 589 F.3d 173 (5th Cir. 2009) (district court's sentencing factfinding role and deference)