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type weapon frequently most used . seeking ensure crimes
commit regulating the possession laws
that state effec- type weapon are use.
tive.
UNITED STATES America
, Plaintiff-Appellee FAIRLEY,
Kenneth E. Defendant-
Appellant
No. 17-60001 of Appeals, Court
Fifth Circuit. January
Filed FBI, tables/table_27_leos_fk_type_of_weapon_ See Servs, Div„ Justice Info. Crim. [https://perma.ee/8V2C-FPZ7] 2004-2013.xls Killed and Assault- Law Enforcement Officers (last Nov. visited https://ucr.fbi.gov/leoka/2013/ ed, tbl. *4 Cleveland, Golden, Jay H.
Gaines Tresca Esq.,-Assistant U.S. Attor- Attorneys, U.S. ney’s Office, District of Missis- Southern MS, sippi, Gulfport, Plaintiff-Appellee. for Larson, Jr., Orleans, V. Herbert New LA, Knott, Knott Sanford Sanford & Asso- ciates, P.A., MS, Jackson, Augur Arnold Associates, Spencer, Spencer & Fort TX, Worth, for Defendant-Appellant. WIENER, HIGGINSON, Before COSTA, Judges. Circuit HIGGINSON, STEPHEN A. Circuit Judge:
Appellant-Defendant Kenneth his conviction for theft of appeals availability to increase of af- of 18 which aims government property violation (counts three) housing. Through pro- fordable the HOME U.S.C. with gram, partners “participating HUD commit theft of conspiracy to jurisdictions,” certify which turn non- U.S.C. in violation property (1) Community Housing Development one). profit (count argues that: (CHDOs). Organizations indictment, instruction, Certified CHDOs grants HUD eligible are receive 641; §of form all the elements misstated and renovation of affordable construction erroneously admitted district ‘ housing units. non-hearsay conversations as recorded coconspirator; of a statements Fairley served as executive director of Fair- improperly district court calculated Services, Inc., Community a non- Pinebelt ley’s imposed inappli- an loss amount and’ profit organization. city March sentencing cable enhancement. Because Mississippi, Hattiesburg, partici- a HUD indictment, instruction, errors in the jurisdiction,'designated pating Pinebelt directly and verdict form undermined approved August CHDO. In Hat- defense, Fairley’s Fairley’s we VACATE tiesburg into con- and Pinebelt entered conviction under counts two and 'three. We agreed tract under which Pinebelt de- AFFIRM conviction under count units, velop housing low-income three (cid:127) one, district evidentiary and the court’s Hattiesburg agreed reimburse Pinebelt sentencing rulings. We Up program REMAND of HOME *5 agreement court to determine. whether provided district also for funds. $18,637.60 Fairley’s change light to to up sentence should Pinebelt receive operating addition to the convictions.1 funds HOME vacated parties later funds. The amended the con- I. tract, agreed and- that Pinеbelt would in- >single' family stead renovate two homes: trial, six-day After a found Ken- 202 South Street and 127 East 5th Street. Fairley guilty of theft neth counts government and one count July August In funds and Pinebelt sub- to theft of conspiracy commit for “request[s] mitted two Hat- funds” to conspira- from a charges funds. The arose $98,000. tiesburg totaling requests man, and another Ar- cy Fairley between signed by Fairley, ostensibly were and Fletcher, to inflated submit construc- thur sought reimbursement for “services ren- government- tion bills to a United States costs/expenditures” dered allowable housing program. Fair- backed. affordable rehabilitating with associated the South ley imprison- 36 months to sentenced and 5th Street homes. After receiv- Street was ment, to all three ing requests, counts.2 Hattiesburg paid concurrent Pine- $98,000. belt
i. The HUD Grant ii. The Government’s Case Department of Hous- The United States Development (HUD).oper- ing government presented At and Urban trial the evi- conspired Fairley investment dence that program, ates the HOME his old McRae, Fairley See 2. sentenced to 36 States v. months of also ("Our practice court’s supervised release and was assessed a fine of counts, one, $60,223.95 within a multi- $30,000, when but not all $300 restitution of and a рart general- been vacated has conviction has special assessment. ly the district remand to allow .been instance.”). first resentence govern- provided friend Fletcher secure second HUD contract defraud Hattiesburg. Hous- with ment.3 Fletcher Interurban owned. LLC, Development To for apply and receive HOME funds from Hatties- iii. Gase
burg, sug- Pinebelt submitted documents defense, Fairley In his disputed gov- ,had. it for gesting solicited bids ernment’s, contention that Interurban did contract, a contrac- selected Interurban as work, no and described the transfers from competitive bidding process, tor after charity Fletcher’s as loans and donations. $98,000 and Interurban billed Pinebelt challenged government’s also properties. in construction at costs the two interpretation HOME program regula- government, According these docu- government’s tions and the A accounting. false, were Interurban ments did no HUD consultant called testified Nonetheless, the properties. work.on may CHDOs properly reimbursed government investigation that Pi- showed under HOME for operating expenses, in- $72,000 to nebelt sent after Interurban cluding that, salaries. showed al- $98,000from receiving city. though investigate HUD did and suspend . agent An Inspec- with the Office of the Pinebelt, investigation found Pinebelt tor General testified that admitted Hattiesburg’s documentation to be on, to him that did no work Interurban “satisfactory” eventually and HUD lifted Street properties. South Street 5th suspension. Pinebelt’s agent The same testified Fletcher ad- Fairley also an accountant called mitted that work Interurban agent former IRS who testified Pine- projects, Pinebelt but that Fletcher had spent—including costs—ap- belt overhead Fairley to allowed name use Interurban’s proximately rehabilitating the qualify grants. for HUD Street and 5th properties South Street An that a agent IRS testified review of August August between *6 Pinebelt’s finances showed that Pinebelt addition, a construction contractor-‘called only $88,000 spent approximately renovat- the value of estimated that agent properties. two The also properties work on two to- Pinebelt’s transfers, several documented described $149,000. Finally, approximately taled money” necessary “seed secure as testimony ten Fairley elicited that at least Hattiesburg, contract from charity with a' contractors different and and between by Fletcher controlled Pinebelt.4 The projects, 20 volunteers on the worked two government presented evidence had, fact, that Interurban worked and .in on properties rehabilitation work was projects. on the shoddy, properties pass and the in- did spection years until after Pinebelt was iv. The Verdict Finally, re- paid. played the. phone Fairley guilty The found all calls between and
corded calls, counts. The form attempted Fletcher. Fletcher three verdict read Fairley, . money apparently collect follows: charity money pled Fletcher’s from third Fairley, Fletcher raised 3. indicted but profited party from the guilty charge donations. Fletcher to a related before trial. Fletcher by shifting compa- to his scheme testify Fairley’s at trial. ny, Interurban. § Indictment, property con- 18 U.S.C. of the violation 1. On Count indictment, jury Fairley argues commit theft violation that- the spiracy to we, jury, instruction, the De- § find all U.S.C. and form misstated Fairley, E. Sr.: § fendant Kenneth asserts elements _ _ (1) Guilty Not legally insuffi- that: the indictment was (2) three, Guilty cient as to counts two Indictment, jury to permitted 2 of the instructions 2. On Count willfully receiving, retain- knowingly convict of a nonexistent offense any three, (3) mon- concealing, converting or ing, counts under two and thing belonging or ey, property, value two and three invalidate errors counts having aggre- an to the United States his conviction under count one. conspiracy than in viola- of more gate value begin: by discussing the structure of We 641, we, jury, § tion 18 U.S.C. § and then evaluate claims Fairley, E. find the Defendant Kenneth of error.
Sr.: " _ _ Guilty Not § i. 18 U.S.C. 6U n Guilty Code, 18, United States Title Section Indictment, 3. On Count 3 acts. first 641 criminalizes two distinct willfully receiving, retain- knowingly §of it a crime to: paragraph makes- any concealing, converting or mon- ing, (1) steal[], ], or purloin[], “embezzle[ ey, thing belonging or of value property, knowingly ] [the defen- convert[ having aggre- an to the United States or the own use use anoth- dant’s] $1,000 in of more than viola- gate. value er”; 641, we, jury, § tion of 18 U.S.C. (2) thing “a of value of the United Fairley, E. find the Defendant Kenneth States.” Sr.: _ _ Guilty para- Not 641. Under the second 18 U.S.C. Guilty graph of it is a crime to: (1) ], ], ]”; “Guilty” “X” jury placed conceal[ retain[ next “receive[ For all three counts. counts States; thing value the United three, “retaining” crossed out it to [the “with the intent to convert form, leaving “concealing” on the verdict gain”; use defendant’s] “receiving” “converting” as the embezzled, (4) “knowing it to have been operative the verdict was verbs. When *7 stolen,-purloined or converted.” clerk, by the court’s read aloud district short, paragraph stealing Id. In one covers out Fair- clerk omitted words.5 crossed paragraph from the United and two States object. ley did receiving stolen United knowingly covers II. property. See Milanovich v. United States 551, 728, 554, States, 5 365 U.S. 81 S.Ct. charged of the Count one indictment (1961) § (discussing 641 and conspiracy commit of L.Ed.2d Fairley theft 773 provision of distinguishing between “the of government property violation 18 receiving an of- § the statute which makes Counts two and three U.S.C. government relating to rob- charged provision with theft fense” and “the receiving converting any money transcript willfully 5. The for both counts reads: "On or indictment, knowingly and 2[/3] Count
205 Minchew, v. bery”); government purports United States 417 case. The to cite au (5th 1969) curiam) 218, (per 219 thority support, Cir. but its miss F.2d cases (“The apparently § [in Milanovich] Court generally mark. Some state 641 cov Congress, by adding para- range concluded ers a broad conduct. See Moris 641 to reach graph States, 246, two section intended sette v. United 342 U.S. 266 not to group wrongdoers, 240, (1952) n.28, 271, new 72 96 S.Ct. 288 L.Ed. multiply the offense the thieves them- § (discussing 641’s broad reach and stat selves.”). overlapping that there is “considerable embezzlement, stealing, purloining § though paragraphs
Even 641’s two knotoing grouped conversion in this acts, id.,6 Fifth target separate Cir- added)); (emphasis statute” United States § cuit’s for 641 pattern instruction (5th Dowl, 2010) v. F.3d applies only paragraph. the first Fifth curiam) § (Criminal (per (noting 641’s con “broad Jury Pattern Instruction Circuit struction”). (“Theft tan Cases) Others address even more § 2.27 Govern- gential issues. See § Rea Money Property—18 or U.S.C. (5th 2010) (First gan, 596 F.3d Paragraph)”). The Ninth Circuit’s (“[E]ach entries, taking of consti separate distinct funds pattern instructions have elements, separate tutes a under for violation the stat paragraphs with different ute.”); Bailey, Compare one and Manual of Model two. 1984) § (describing 641’s Jury Instructions for the District
Criminal - (2010) “purpose” “to provide § as for Ninth sanction Courts Circuit 8.39 by (“Theft person conduct which Property or intentional ei Money Government (18 (“Re- wrongful or 641)”) misappropriates ther obtains a § § -with 8.40 U.S.C. id. advantage government property”). from Money or ceiving Stolen Government (18 641)”). govern § And at least one undermines the Property U.S.C. position'. ment’s See United States v. Further, animating the verbs 641’s 1983) Bauer, 713 F.2d 74 n.9 paragraphs fungible. first two are (“[T]he may charge, Government elect one—embezzle, steal, paragraph verbs in for, obtain a conviction either theft or purloin, takings or convert—describe retaining. receiving, concealing or That possessions that are fraudulent other- say mutually is to crimes are not illegal. Paragraph wise two’s verbs—re- exclusive.”). ceive, broader, conceal, and retain—are cover innocent well as illicit acts. short, govern- nothing cited is clear argues ment causes us to doubt what disagrees. It statutory prior separate para- 641 is into both the text cases: divided reasons, paragraphs first describe merely for section 641’s two graphs historical has,no acts, criminal with distinct ele- bearing that this distinction two distinct Zettl, para receiving property 641 and stolen under 6. See also United States v. 1989) ("Section prohibits on the graph [§ ] based same embezzle, steal, separate occurrence.”); acts. The first is to Boyd, property knowingly convert United States *8 (stating, appeal on Cir. 1272 sell, dispose convey, and second is to or of the 641, portion § a under that conviction property authority.”); States United without jury charge "wаs intended to inform the Belt, 873, 876 n.8 516 F.2d larceny jury of the difference and the between (8th 1975) ("In Cir. the defendant Milanovich charged—reception, con and crime retention charged crimes of had been with the distinct cealment”). (1) larceny paragraph [§ ] under of 18 U.S.C. 206 indictment, to correct plain instruc- discretion reversible error
ments. (cid:127) all, ‘only seriously if tions, form and will do so error .in and different fairness, integrity, or public para- the first affects ways, combined second and ” judicial proceedings.’ reputation Unit single § into purported 641 graphs Dominguez-Alvarado, v. 695 ed States cross-incorpo- erroneous offense. This 324, (5th. 2012) (quoting 328 Cir. F.3d ration, Fairley’s convic- and its effect dStates, 129, v. Unite 556 U.S. Puckett tion, is below. discussed 135, 1423, S.Ct. 173 L.Ed.2d (2009)). ii. The Indictment “
Fairley challenges counts two and three validity ‘[T]he an indictment These as insufficient.7 indictment governed practical; not con by is technical knowingly “did charge counts that siderations,’ purpose basic be ‘[t]he retain, conceal, willfully convert hind an is to inform a defen indictment1 ” money or of another his own use the use charge against United dant of him[.]’ greater an amount (5th Cooper, States v. 714 F.3d so, $1,000.00.” doing indict- 2013) than (second original) Cir. alteration and “cоn- ment borrows the verbs Ramos, “retain” (quoting United States v. 537 F.3d §of ceal” from two But paragraph (5th 439, 459 and United States paragraph two’s re- omits Hoover, indictment elements; charge maining it -does not that 2006)). legally “An indictment is sufficient (1) to con- “with intent (1) acted: if ‘each count the essentiál contains money to “his own (2) vert” United States’ charged,’ of the offense ‘the elements (2) “knowing gain”; money] or [the use particularity,’ elements are described with embezzled, stolen, purloined, to have (3) been charge specific enough ‘the is converted.” 641. U.S.C. subsequent protect against'a the defendant ” combining verbs from argues that Id. prosecution for the same offense.’ receiving prong prong, theft 64'1’s Threadgill, (quoting United States v. charged him indictment non- 1999)). Fairley’s F.3d 366. “hybrid en- offense” does existent argument goes the first of these three compass all of either criminal act. elements requirements.8 object to " [1] his indictment concedes that he below, we tion for The Fifth paragraph Circuit’s one pattern jury §of lists instruc- three elements:' therefore indictment’s sufficien review First: [property] That cy for States v. McGil plain error. United [thing of in the i-ndict- value] described 2007). berry, 328-29 gov- belonged to the States United requires showing. “This standard ernment and had value excess (1) error, plain, there was alleged; at the time (in rights.” that affects substantial Id. Second-, omitted). Even when quotations ternal That defendant embezzled met, prongs court retains converted] these are such món- [knowingly “[t]his [stole] Although Fairley argues Any potential duplicity challenge is forfeited instruc- tion errors as to counts and three under- by Fairley’s object-before failure to the district one, court; mine his under he ex- conviction count Stanford, See ' any argument pressly disclaimed that count indictment, one, charged tjie inde- pendently insufficient.
207 [thing Robinson, (5th of ey [property] 575, the States v. value] 578 of 1992))). own use the use [to defendant’s an- Cir. The'indictment.icharges that other]; and Fairley “retain[ed], concealed], and con verged]” That so
Third: the defendant did (emphasis funds knowing [thing of [property] added). the object Fairley did not to his indict his not and with intent value] was ment, clarification, not did ask for a of of deprive the owner the use [benefit] argue superfluous does not verbs money [property] [thing of value]. Rather, prejudiced his defense. at least Fairley, according “the Government Jury Fifth Circuit Pattern Instruction Cases) (brackets pursued a of (Criminal theory of ‘theft Government 2.27 trial, Pruett, property’ opposed at tó original); see also United States as v. know (5th 2012) (per ing receipt 681 property/]” F.3d 247 of ‘stolen is There curiam) instruction). Omitting (approving Fairley expected no indication anything from the words “retain” and “conceal” else. of
counts two and
the'
three
indictment
remaining language largely
shows that the
has often
This
noted that the
first
pattern
second
ele
tracks
“minimal
standards”
constitutional
that an
“money
ments: the
describes
of
indictment
compel
‘not
indictment must meet “do
a
”
amount
an
greater
United
Ramos,
ritual of
Fairley’s alleged
plain error.
and we therefore review the instruction
of his offense—is not
element
plain
Jury instruction error “does
error.10
it
plain
not amount to
unless
could
error
Jury
iii.
Instructions
acquit
have meant the difference between
that,
Fairley argues
by conflat
tal and
United
v.
conviction.”
States
receiving
of 641’s theft and
elements
348,
(5th
McClatchy, 249 F.3d
357
Cir.
prongs,
jury
instruction and verdict
2001)
omitted);
(quotation marks
see also
incorrectly
jury
A
form
stated
law.
Kibbe,
145, 154,
v.
431
Henderson
U.S.
97
(1) correctly
must:
state the
instruction
(1977) (“It
1730,
drawn 641’s On Count know- 2[/3] retain, graph—receive, ingly willfully receiving, retaining, and conceal.12Sec- ond, concealing, converting any money, court’s instructions re- or district element, placed thing belonging the third which covers or value property, intent, knowledge requirement having aggregate United with a convert,” that to' in violation of acted with “intent value more than 641, we, jury, from apparently also drawn 641’s “re- U.S.C. find Fairley, ceiving” Defendant Kenneth E. paragraph. Sr.: States, belonging you repetition court later or all of 11. The corrected its the United "converted.” proved agree be- government must that yond a reasonable doubt the defendant that very 12. The clear that the district made knowingly money, willfully aAd concealed not need to find that did all did property thing belonging or of value to the acts, convict on these four and could a unani- States, you agree or all of that must finding any mous that did one of government proved beyond a reason- them: knowingly able doubt that the defendant government-does prove not have all willfully money, property retained or you guilty verdict on these return thing belonging of value to the United charges. beyond а these Proof reasonable States, you agree or all of must that the enough. doubt on one is But in order to government proved beyond a reasonable verdict, guilty you a ver—a all of return knowingly that doubt defendant agree must on the same one that has been willfully money, property converted proven. you agree gov- All of must thing belonging of value the United proved beyond ernment a reasonable doubt States, willfully knowingly defendant thing money, property received of value n n _ __ dispute at trial he Guilty Not lawyer As his received funds.
Guilty closing: “Everybody agrees Pine- it put added). (emphasis ninety-eight from the received the belt form jury charge, the verdict Like agree on that. Got it blue.” city. We receiving para- § 641’s verbs Rather, Fairley argued that, properly he used requirement graph, but omitted the renovating spent HUD funds the two money had been knew the the defendant called properties. He several witnesses embezzled, stolen, purloined,.or theory' spent converted. his support Pinebelt instruction, the But unlike the renovating properties more the two *12 of an intent no mention government. form made than it received the in- disputed government’s the convert. also expenses prop- of terpretation what were jury court’s erroneous The district Pro- erly reimbursable under the HOME error. The failure to plain' instruction was short, gram. Fairley sought In to show of require proof of each element conviction it government got the the benefit that Fairley’s rights. See affected substantial $98,000. exchange in for its sought Permit- 506, Gaudin, 515 U.S. jury receipt ting the mere convict 2310, 511, 115 444 S.Ct. 132 L.Ed.2d directly intent to convert with therefore (“The gives a criminal'defen Constitution theory.13 defense undermined jury right dant the to demand a find jury the effect the instruc- further, guilty him all the elements the crime compounded by errors in the was tions see charged.”); which is also Unit with he indictment. it form and be- verdict When Savoires, ed States v. 380 gan deliberating, jury provid- the had been (6th 2005) (mixing elements of 18 three different recitations the ed ele- § jury in U.S.C. 924 instructions and § necessary convict 641— ments -under error); plain States v. dictment was United form, instruction, and verdict indictment. Wilkins, Fed.Appx. 546-47 others, Each these from the differed 2007) of: (plain error “the instruc where § correctly ele- none 641’s stated tions the of the use mixed elements or All included verbs from the receiv- ments. § carry a 924] firearm under 18 U.S.C. [of none require- but the prong, included possession of offense'with those of the knowing the defendant act ment that fense”). True, jury permit instructions embezzled, question property in has been only upon finding ted conviction stolen, or purloined, Only converted. one [gov acted “intent to convert with acting included the element the three money] ernment to his use.” And the re n property. with intent to convert the knowingly sulting distinction—between converting money receiving, retaining, impact The also errors was these government’s amplified by argument intent to concealing convert jury. Chagra, in to See States v. it—is slim. But built his defense 1986) (“We receiving F.2d between and convert space jury ing. deficiencies review claimed which, noted, jury’s theory, requires compares receiving as discussion actual This proper "knowing gov- for conver- instruction to instruction acted [the that the defendant gov- paragraph embezzled, one of The under property] sion to have been ernment argued never that the instruc- stolen, ernment has purloined converted!.]" paragraph proper tions were under by looking charge to the entire charge long error here. courts as “Federal have held arguments jury”). as the thаt additional well made notations are. brought government directly and tried responsive jury charge to the that receiv- case under mistaken belief verdict form are surplusage, are to be ing, retaining, concealing government ignored.” Pines Liqui- Great Co. v. Water §by ab- property prohibited even Corp., Box F.3d knowledge property em- 2000); was Ailsworth, sent see also United States v. bezzled, stolen, purloined, or (“Gener converted.14 closing it argument, be- differentiated ally, unnecessary or statements irrelevant government money” '“theft of as tween may a verdict form disregarded one, “receiving], charged count and the surplusage.”). Applying partic this rule is convert[ing]” retain[ing], concerting], or where,.as here, ularly appropriate no in charged offenses in counts two three. quiry by the was made district court con cerning or why how form verdict argues er- these Although modified. was read jury’s by rors were cured uninvited district aloud court’s clerk without noted, As modification form. (cid:127) words, out the crossed and the district “con- “retaining” crossed out *13 generally polled jury, the the court form, cealing” leaving only on the verdict did not ask who crossed out the form or “converting” as “receiving” opera- and the how to the decision do so was made.15 tive verbs counts two and three. Accord- government, by crossing out the government’s argument The that the “retaining” “concealing,” jury and the indi- were, fact, responsive cross-outs to the they unanimously that had cated found jury charge by is transcript. belied the As that both and “convert- “received” noted,' the district at explained court' This, government money. gov- ed” the length jury did not need find ernment, any cures with the indict- issue received, concealed, retained, that instructions, or knowing ment because converted; they could convict on a- by paragraph is prohibited conversion one finding any unanimous that Fairley did § appears 641 and the term in the in- four judge one of the acts. The trial never dictment, instruction, form. and verdict jury told the which of the four .indicate unprompted its verdict or to supported acts cross out unexplained form they unanimously. modifications do not Ac- dissuade verbs did find finding plain cordingly, affirming Fairley’s us in our discretion conviction court, govern- government’s 14. In its brief this in- before the 15. We also observe the that counts, ment its belief that terpretation only plausi- confirms the notеs not the merely charge Fairley three do not theft instance, maybe jury ble For the one. found government money § 641’s first under "retaining” "concealing” that were not paragraph. government asserts out, evidence, by supported the them crossed pattern instruction for [Fifth Circuit] “[t]he unanimously remaining one of the found that only paragraph first 641 addresses the present, they verbs was realized had a convic- the statute and thus version modified tion, and concluded deliberations without (em- apply charges case” would the this considering maybe Or ever final verb. added). phasis argument, govern- At oral foreperson on his or her made alteration appeared to still be unsure what crime maybe jury exactly own. Or what actually was convicted of. When record, government sim- On we assumes. pressed, government's attorney said: "I ply know. cannot reading think that the best is that the result [Fairley] guilty of conversion.” supporting “X” of the elements anything beyond the next to misstatements based give vacating effect to “additional two and three necessitate “guilty” would count directly respon- are not notations that jury count hold that count one was one.17We form.” jury chargе and verdict to the sive from the counts and distinct substantive Co., 203 F.3d at Pines Water Great regarding errors counts two and three plain therefore do extend cause short, §of the elements were Fairley’s conspiracy conviction. error government’s argument, confused instructions, indictment, The district court instructed the form. The combined error di- the verdict the first element count one was Fairley’s theo- rectly undermined defense at other “that the defendant and least one to convict ry permitted agreement to commit person made seriously affected non-offense. This error government money, crime of theft trial, integrity of the fairness and charged (emphasis the indictment” add- 'in be- could meant the difference have ed). form also The verdict described the acquittal. there- tween conviction and We in- offense as “theft” and referenced the Fairley’s conviction under fore vacate one of dictment. Count the indictment three.16 counts two and con- charged Fairley and Fletcher to: spired iv. Count One or commit defraud the United States Fairley was also convicted of against offenses United States as one, charged con count which follows: mon commit theft of spired to Embezzle, steal, purloin, knowingly or Fairley argues ey in violation convert to their use the use of anoth- conviction on this count must be that his record, voucher, any money, thing er *14 points to no actual Fairley as well. vacated agen- or of the United States an value presented count in error in how one was thereof, 641, in cy violation of Section indictment, instructions, jury the 18, (emphasis Code Title United States form, government’s argument. Nor or added). all to 641’s could he: were true theft noted, Rather, government’s closing Fairley Finally, as the prong. argues that be argument distinguished count one rested on the same sub between “theft cause three, government money” charged in count stantive offense as counts two and argues jury also that the instruc- two one. 16. and three invalidated count enlarged impermissibly brief, the tion indictment argument reply expand does in his including “receiving” Fairley’s as one of authority. indepen- but still fails to cite In our amendment, criminal acts. Constructive how- analysis, we dent note that our court reversed ever, permitted if the to con- "occurs conspiracy based on errone- conviction an permitted by vict on 'an alternative basis the separate ous in a but related instruction sub- ” charged in statute not the indictment.’ but Smithers, See United v. stantive count. States Daniels, 411, v. 414 252 F.3d (5th 1994) (flawed jury 146 Cir. (5th added) (quoting (emphasis Cir. offense un- instruction as to substantive “also Robles-Vertiz, United States v. charge). conspiracy But related dermine[d]" (5th 1998)). find 728 Because we Fairley may per- well have cited not Smithers law, any misstated con- instructions the (1) ceiving inapposite because Smith- that it is point. amendment is beside the structive error, preserved is no ers the there conspiracy indication Smithers’ count Notably, Fairley's opening brief devotes any way was in distinct from the flawed sub- single supporting no sentence—with n.4, authority—to arguing 144 145-47. that errors in counts stantive count. Id. at one, con- “receiving], retaining], the course the conspiracy; charged in ceal[ing], convert[ing]” offenses statement was made furtherance Hall, United States v. conspiracy.” repeated counts two and three. These 2007). F.3d The content instructions made clear challenged statement count one—unlike three— itself must be counts two and considered, steal, proponent but cannot charged Fairley conspiring es receive, admissibility tablish based on state merely rather than Nelson, alone. United States money. 2013). F.3d must “There Further, encompass count one does ‘independent establishing evidence’ retention, concealment, and conversion (quoting conspiracy.” Id. government money in counts charged El-Mezain, F.3d Although count one de- three. 2011)). receiving scribes the conduct that led grants underlying HUD counts two Fairley argues govern three, actual of those funds is receipt ment failed establish that the statement not listed as an overt act committed during conspir was made the course of the conspiracy. furtherance of the list of acy According of it. in furtherance money” overt acts includes the “seed Fairley, the recorded were statements Fairley, transfers from Fair- conspira Fletcher made December 2012 and the letter, ley’s engagement cy submission between and Fletcher ended in requests But it July argues and the later for funds. further be receipt. concern chiefly omits actual cause the conversations attempt to recover Fletcher’s separation, high Given this and the Fairley, acting the two men were as adver review, Fairley’s error plain threshold speaking saries have been and could conviction on count one stands. conspiracy. of a re joint furtherance We ruling court’s for abuse of view district III. Robinson, discretion. trial, government prominently At tape be- featured recorded conversations argument misunder Fairley and Arthur tween Fletcher. ex coconspirator stands nature of the *15 portion district court admitted Fletcher’s Fairley ception. on overt acts focuses the non-hearsay by coconspir- as statements a in charged part the of the indictment overruled, Fairley’s objection ator. was August conspiracy, which run until appeals. and he now evidentiary conspira rule of But “the hearsay cy agency
A is not if of law” concepts statement is founded as a against op conspiracy statement is and therefore “[t]he offered “differs El-Mezain, by (quot ... crime.” posing party and was made the F.3d at Coe, United States v. in party’s coconspirator during fur 718 F.2d 1983)).Accordingly, conspiracy R. “a conspiracy.” therance of the Fed. Evid. 801(d)(2)(E). purpose hearsay may To un exclusion] introduce a statement the [for rule, by ‘merely by engaging joint must show a proponent der this the be shown “(1) ... in na a the that was non-criminal preponderance plan[ ] the evidence: Nelson, (second at 516 conspiracy; existence the the state ture.’” original) by co-conspirator of alteration and omission the ment was made a the El-Mezain, 502). At during at party; (quoting the statement made F.3d sayin’ you. get to trial, he that’s I’m To what dispute did to us to secure HUD the that’s been allocated with Fletcher monies worked paid consid back.” grants. The introduced finding that support to a erable evidence (cid:127) do just “I make that as we wanna sure engaged a Fairley and Fletcher were Now, thing goin’ this now we forward. venture, including signed documents joint representa- I know there’s no [HUD] be separate recorded conversation and a- this,' diggin’ in ...” (emphasis tive in City Hattiesburg Fletcher a tween added). employee.18 statements, gov- These with the combined conver- Fairley and Fletcher’s recorded ample ernment’s of the evidence existence ' ' continuing confirm the sations themselves conspiracy of a between Although conten- nature of venture. the Fletcher, conspiracy show that the rе- tious, collect gist trying Fletcher to in effect at the the conversa- mained time in the money advanced that he tions were recorded. ¡reimbursed with would expectation he be Fairley’s argument that the statements This than HUD rather funds. underscores con- in furtherance were not made ongoing of the negates the nature venture: repeatedly fails. cau- spiracy also haveWe yet their the' two men had concluded require- “that tioned ‘in furtherance’' . n joint venture. strictly too lest is not be construed calls, Furthermore, during purpose exception of the be defeated.” plans to repeatedly references continue Cornett, F.3d says: working together- in the He future. 1999). Furthermore, “statements (cid:127) three,' these “I four know encourage loyalty order [made] Fletcher, [Fairley, collectively us among conspirators [is] obedience Pinebelt, gonna person], and another clearly in con- purpose furtherance Street way complete Fifth find Flores, spiracy.” com- 'project way to and will find at- Fletcher’s plete projects, Sixth Street such tempt understanding his enforce his happy city will [HUD] bargain is therefore a further- with Fairley process with happy Graham, ance. See United States the, spent money and the turn out (discus- 454-55 money.” and release the project, concerning drug attempt sions collect (cid:127) mak- always has been a “[T]his conspira- debt were in furtherance of made now, ing proposition even in the cy). future and Pinebelt.” [Interurban] between Accordingly, hold that the district we (cid:127) we, when do next when “[T]he time not abuse its discretion admit- house, ... on Sixth Street ting challenged recordings. understanding gonna ... have an we n *16 get before we started.” IV. “1 n
(cid:127) I gonna move forward Fletch. And, Finally, Fairley sentencing contests you loud clear. have heard First, uh, by to get applied I’m factors the court. movin’ this district forward n stujf completed Fairley improperly so we can be on the that the court asserts Second, back, paid Fairley’s same the monies loss amount. team. Get calculated recording. object of did not admission contract, the district court maintains that the court' subtracted $37,776,05 by enhancing legitimate his for erred sentence abuse labor and materi- argument $98,000 is als position expenses trust. the Neither from total re- persuasive, pursuant to the HUD grant ceived $60,223.96,
arrived at a loss For the i. Lоss Amount contract, uncompleted October the court reduced total the value con-
The district court’s loss-amount tract, $118,637.60, by 38.5%—consistent finding calculation a factual for reviewed proportion the of grants for Hebron, clear error. United States received legitimate expenses first contract— the the But $72,962. words, loss of In other the of calculating court’s method those losses district court assumed for loss calculation application guidelines subject is an that, Id, purposes the had October.2011 con- to de novo review. district court The rescinded, not tract been Fairley would loss, on sentenced based intended gain have realized same illicit as a which exceeded HUD’s actual See id. loss. percentage of the contract amount as he (“The applicable generally loss is August had under the 2010 contract.19 greater of actual loss—which includes reasonably resulting harm foreseeable Fairley contests both district from intended the fraud—and loss—which court’s and its actual method loss calcula harm includes the result intended calculation, tion. Regarding offense.”). guidelines emphasize “[T]he maintains that the shоuld court have cred that must the deference be shown his concerning ited evidence ex additional sentencing judge, is in unique posi who penditures on the South Street Fifth loss, applicable tion to so this assess properties. rejected Street court Fair- only determine court need whether evidence, ley’s finding it. included court made district ‘a reasonable estimate not expenses overheard .could re (quoting Id. the loss.’” U.S.S.G. 2B1.1 contract, imbursed the terms under 3(C)); Izy see also cmt. damage as well as expenses for storm re dore, 213, 222 pair completed.' after the was contract (“[T]he amount loss need be deter testimony instead credited of an precision.”). mined with agent, IRS who calculated total Pinebelt’s Fairley’s permissible calculated
The court intended costs the contract as under $37,776.05. by combining: loss amount its determi- The district court’s choice rely nation of the actual loss agent associated with credible testimony witnesses, the contract for the 6th South Street and and other rather experts, properties, competing Street its estimate of than loss on a clearly second HUD home erroneous. See United States v. intended Sotelo, signed 199,6) renovation contract by Pinebelt in but (“Credibility sentencing October later HUD. voided determinations Specifically, completed August hearings peculiarly as to the ‘are within prov- $72,962
$60,223.95 “ = 61.5%
$118,637.60
216
*17
” (quoting
281;
ince of
trier-of-fact.’
United
ror. Id. at
see also United States v.
Sarasti,
(5th
Jones,
States v.
869 F.2d
(5th
533 Fed.Appx.
456-57
1989))).
2013)
curiam) (district
(per
court did not
“extrapolating
err in
loss [the
argues
also
should
he
have
to inflict on
defendant] intended
the date
for
credit
the actual
received
value
by
her arrest
an
estimate
similar
properties.
South
and 5th
Street
Street
operations in which she was
found
have
paid pursuant
But
was
grant
Pinebelt
to a
engaged”). Here,
there is no reason to
program
took no
interest in
prop-
believe that—after defrauding
govern-
erties to be
Although
renovated.
a later
ment on one contract—Fairley and Fletch-
agreement
City
between the
of Hatties-
er
to play
straight
intended
it
on the sec-
burg
contemplated
Pinebelt
foreclo-
Sentencing
ond contract.
on
based
sure,
agreement
signed
was
several
a
expected
reasonable
loss amount under
months after Pinebelt
paid. Fairley
was
the second HUD contract was far from
presented no
City
evidence that the
ever
speculation.
any
or took
ownership
foreclosed
in the
HUD,
victim,
property, or that
would
Because the district court’s method for
even
city
reimbursed
if the
Ac-
had.
calculating
past ap-
loss
consistent with
cordingly, the district court concluded that
proaches approved
court,
by this
its
value
the South
and 5th
Street
erroneous,
not clearly
conclusion is
Fair-
Street properties was “irrelevant.” This
ley’s argument
point
on this
fails.
finding
not clearly
erroneous.
ii. Abuse Position
Trust
calculation,
As to the method of
asserts
the district court im-
Fairley also disputes the dis
permissibly speculated
it
when
increased
trict
application
court’s
of an enhancement
Fairley’s loss amount
on
based
uncom
for
of position
pursuant
abuse
of trust
pleted
Nelson,
October 2011 contract. See
Sentencing
States
Guidelines Man
(“[T]he
217 upheld repeatedly application have We V. of a posi for abuse the enhancement reasons, forgoing For the we VACATE trust in contexts. For
tion of similar ex Fairley’s conviction on counts two and to upheld application have its ample, we three and REMAND to the district court equip medical owners licensed durable for proceedings further consistent (DME) provider companies that bill this opinion. We AFFIRM con- Medicaid Medicare. enhancement on count viction one. applies Medicare because Medicaid and “depend[] upon honesty and forth provider of the in its
rightness DME COSTA, Judge, GREGG Circuit Miller, claim at submissions!!.]” 607 F.3d in dissenting part: companies occupy such Owners a defendant raises an issue for When position of trust because “the appeal, time on any first he mistake shows faith, provide good to ac them] entrusts only can a basis vacating be the convic seeking information in reimbursement.” curate if, among things, tion other the defendant .; see also United States v. Now Id prove can his sub error affected lin, Fed.Appx. 640 349-50 Olano, rights. United v. States stantial 2016) curiam) (district court not (per 725, 734, U.S. S.Ct. 123 L.Ed.2d applying err to owner of DME 3B1.3 (1993). prejudice inquiry—like This its Usman, company); United States v. counterpart of analysis “harmless error” 2012) (per Fed.Appx. 418-19 (district curiam) just has a different burden with the ap not err in court did government having pre to that a private prove to plying ambu 3B1.3 owner company). lance impact served error did result— appellate judges engage inqui causes Fairley served as executive di they ordinarily ries For do undertake. Pinebelt, approved rector of Commu usually supposed are not example, we Housing Development Organization nity can, But we “weigh evidence.” under HUD’s HOME Investment Part must, deciding prejudicial when often role, Program. nerships See, e.g., of a trial effect error. occupied position respect of trust with Davis, that mirrors the role of a DME HUD Rice, 2010); provider under and Medicare. Medicaid courts also Appellate Testimony at trial elicited showed normally do not assess a witness’s credibil HUD, through Hattiesburg, on Pi- relied but, prejudice inquiry, in a we have ity, representations of its own ex nebelt’s evi impeachment the force evaluate penses seeking Fur reimbursement.20 Tur dence was not available at trial. ther, Fairley’s position as of a director — Stаtes, -, ner v. United U.S. commission of CHDO facilitated 1885, 1894-95, 198 L.Ed.2d S.Ct. eligible are to re offense: CHDO’s Bowie, (2017); Accordingly, ceive HOME funds. the dis (D.C. (contemplat 910-11 application trict of a court’s abuse ing how undisclosed evidence would have position of trust enhancement was not police at trial impeach clear been used error. witnesses, Fairley's pro- way a HUD consul- that’s consistent with the One tant, agreed gram[.]” that HUD "assume[s]” that given going spent to a "is CHDO [00] CM tH
officer).
knowingly
of
it
jury
The
time
took the
that
defendant
and will-
length
not
into a
fully
money, property
thing
a
does
factor
or
reach
verdict
concealed
sufficiency of
challenge
States,
to the
the evi
belonging to
of
the United
value
dence,
it
may
courts
consider
appellate
but
agree
you
govern-
or all
must
that the
of.
evaluating
an error
had
when
whether
proved beyond a
ment
reasonable doubt
Rogers v. United
effect on the verdict.
knowingly
that the defendant
and-will-
35, 40,
2091,
States,
95
45
422 U.S.
S.Ct.
fully
money, property
thing
or
retained
(1975);
Vasquez,
Marino v.
L.Ed.2d
States,
belonging
of value
to the United
1987)
cases).
499,
(citing
Cir.
you
agree
govem-
or
must
all
that the
of
of
many
typically
the rules that
Why do
beyond a
proved
ment
reasonable doubt
go
govern
review out
window
appellate
knowingly
that the
and will-
defendant
engaging
prejudice
in a
or
when a court
money,
fully
property or
converted
inquiry?.
very
Because'the
harmlessness
thing
belonging
value
to. the United
of
inquiry requires
of
an-
a re
nature
such
States.
something
viewing court
do
at odds with
The district court thus read the verdict
typical
place
jury
its
in the
function:
itself
finding
guilt
as a
of
for
only
aloud
jury
speculate
box to
about how the
that
not
were
deleted: “knowingly
offenses
its verdict.
reached
receiving
converting any
or
money.” That
jury
speculation
If
about what
verdict is the one to which the
assent-
thought
prejudice analysis,
in a
is allowed
-
ed with a show hands.1
ignore powerful
how can
evidence
we
majority opinion says
But the
we cannot
thought?
jury actually
The
what
in assessing
the cross-outs
provided'
showing
with its
consider-
cross-outs
impact
the instruction
Fairley guilty
error because
found
under the con-
that-it
jury notations that
theory for
“additional
are not di-
version
which the instruction
rectly responsive to
jury charge
proper.
plausible meaning
crossing
“retaining”
surplusage
verdict form are
and are to
jury’s
out
be
“concealing”
response
ignored.” Maj. Op.
is as a
211.
the court’s
at
Even accepting
stated,
unanimity
principle
as
it
not
instruction:
does
bar
given
consideration of the cross-outs
you
agree
govern-
must
that the
All
,a
they
trial court’s view that
were
re-
beyond proved
ment
reasonable doubt
sponse
unanimity
to the court’s
instruction.
knowingly
defendant
and will-
fully
any
placing juiy
And
notations off
money, property
thing
rule
received
States,
belonging
majority opinion
of value
to the
limits is not as firm as the
United
suggests;
you
agree
govern-
typically
or all of
must
courts
frame it
aas
beyond a
proved
fundamentally,
reasonable doubt matter of
More
discretion.2
majority opinion’s attempt
("Surplusage
rejected,
up
may
be
come
added));
being
possible
(emphasis
for
with other
reasons
the cross-outs
harmless
'
Ailsworth,
843,
is thus
the district
under-
at odds with
court’s
United
138 F.3d
States v.
standing. Maj. Op,
(holding
long
at 212 n.62. But even if
that so
as nota
possibilities, they
those
unqualified
do
theories
remote
tions
not cast doubt on the
do
are
verdict,
help Fairley
he bears
general
"unnecessary
because
the burden
nature
demonstrating
certainly
prejudice
may
irrelevant statements in a verdict form
be
likely
most
reason for the cross-outs is the
disregarded
surplusage” (emphasis
add
ed));
unanimity requirement.
Casualty
Co.
Slotkin
New
Citizens
York,
(2d.
1979) (hold
See,
States,
e.g.,
attempt
jury’s
through
Statler v. United
157 U.S.
extraneous
damages
All has said about the final demanding
and more condition must can
be met before we vacate a verdict for a presented to the trial
reason court: seriously affected the “fair the error
ness, integrity, public reputation judi Olano, proceedings.”
cial U.S. at SINGH, Jatinder Petitioner 1770. The same considerations S.Ct. prevent Fairley demonstrating from also influence this prejudice assessment SESSIONS, III, B. Jefferson error resulted in whether overlooked Attorney General, U. S. injustice. So should the fact Respondent correction, cost of terms the burden court, jury, parties, on the and trial is No. 16-60059 greater much when vacated than is. when sentence Cf. of Appeals, United States Court Sabillon-Umana, Fifth Circuit. J.) 2014) (Gorsuch, (adopting requirement presumption that fourth January FILED plain-error correction is satisfied sen tencing part cases in because the “cost of compared is so small” to vacat
correction convictions). It concern with “for
upsetting brought verdicts error not
to the attention the trial court” that
gave stringent require to the final rise plain-error
ment for correction an era—
quite different ours—when sentenc
ing appeals virtually were nonexistent. Atkinson, 297 U.S. S.Ct. L.Ed. principle against
(explaining that va
cating verdicts because errors not upon at trial “is
raised founded consider
ations of fairness to the court and to the
parties public bring interest
ing litigation opportu to an end after fair
nity present has been afforded to all issue