986 F.3d 557
5th Cir.2021Background
- Scheme: Telemarketing “heat pitch” timeshare-exit scam—fraudsters promised buyers, charged $1,000–$7,000 marketing/closing fees, used "lulling" scripts and staged verification calls to avoid chargebacks.
- Concealment: Operators used fake addresses/numbers, rotating company names, and high-chargeback-tolerant merchant processors.
- Roles: Martinez incorporated businesses, obtained bank and merchant-processor accounts, rented office space, and later ran satellite telemarketing operations; Warren (VoiceOnyx) provided phone/internet/database services, configured caller-ID and call-routing, and advised on evasion tactics.
- Indictment & trial: Superseding indictment charged conspiracy, mail and wire fraud, and telemarketing-target enhancements; trial (Jan 2018) produced convictions on all counts.
- Sentences & restitution: Martinez—114 months, $5,573,045.84 restitution; Warren—102 months, $291,854.58 restitution. Appeals raised sufficiency, hearsay/co-conspirator evidence, sentencing (18 U.S.C. §2326 and U.S.S.G. §3B1.1), and restitution Sixth Amendment issues.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Sufficiency: single conspiracy & aiding-and-abetting liability | United States: evidence supported a single conspiracy (common goal, overlapping participants, scheme continuity) and Martinez’s affirmative acts (incorporation, merchant account, management) aided the fraud. | Martinez: evidence showed separate conspiracies and insufficient link between him and the charged mail/wire offenses. | Affirmed. De novo review; jury could rationally find a single conspiracy and that Martinez’s acts supported aiding-and-abetting convictions. |
| Admissibility: co-conspirator hearsay / victim statements | United States: statements were admissible (not offered for truth or admissible under co-conspirator exception) to show the scheme and that statements were made to lull victims. | Martinez & Warren: admission of co-conspirator/ hearsay statements was improper. | Affirmed. Many statements weren’t hearsay (offered to show they were made); co-conspirator exception unnecessary; Warren mostly failed to preserve objections. |
| Sentencing: 18 U.S.C. §2326 telemarketing enhancement (consecutive six months) | United States: §2326’s phrase "in addition to any term" authorizes a separate consecutive sentence on top of the underlying fraud sentence. | Martinez & Warren: §2326 merely increases statutory maximums and does not mandate consecutive sentences. | Affirmed. Court gave plain-meaning reading: §2326 authorizes a consecutive sentence; no ambiguity for lenity. |
| Sentencing: §3B1.1 manager/supervisor adjustment for Warren | United States: Warren controlled and managed technology (database, phones, domains), trained/ directed users, and thus functioned as a manager/supervisor. | Warren: was a consultant who provided technical services, not a manager or recruiter with decision-making or control. | Affirmed. Role finding is factual (clear-error review); caselaw upholding adjustments for management of property/assets supports the three-level increase. |
| Restitution & Sixth Amendment | United States: restitution order proper under controlling circuit precedent. | Martinez: restitution calculation violated Sixth Amendment right to have a jury determine facts that increase restitution. | Affirmed. Issue foreclosed by Fifth Circuit precedent; Martinez preserved the argument for further review only. |
Key Cases Cited
- Rosemond v. United States, 572 U.S. 65 (2014) (standard for aiding and abetting intent)
- United States v. Sanders, 952 F.3d 263 (5th Cir. 2020) (aiding-and-abetting convictions upheld without proving defendant’s presence at each offense)
- United States v. Beacham, 774 F.3d 267 (5th Cir. 2014) (common-goal test for single conspiracy)
- United States v. McDonnel, 550 F.2d 1010 (5th Cir. 1977) (victims’ testimony about fraudulent statements admissible to show statements were made)
- United States v. Delgado, 672 F.3d 320 (5th Cir. 2012) (Application Note discussion on management responsibility under §3B1.1)
- United States v. Ochoa-Gomez, 777 F.3d 278 (5th Cir. 2015) (applied §3B1.1 where defendant managed property/assets)