United States v. Darren Reagan

Case: 10-10211 Document: 00512330432 Page: 1 Date Filed: 08/02/2013
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
August 2, 2013
No. 10-10211 Lyle W. Cayce
Clerk
UNITED STATES OF AMERICA,
Plaintiff – Appellee
v.
DARREN L. REAGAN, also known as Dr. Darren L. Reagan; D’ANGELO
LEE; DONALD W. HILL, also known as Don Hill; SHEILA D.
FARRINGTON, also known as Sheila Hill,
Defendants – Appellants
Appeals from the United States District Court
for the Northern District of Texas
Before JONES and CLEMENT, Circuit Judges, and KAZEN*, District Judge.
EDITH BROWN CLEMENT, Circuit Judge:
Donald Hill, D’Angelo Lee, Sheila Farrington, and Darren Reagan (the
“appellants”) appeal on numerous grounds their convictions and sentences in
this case involving substantial and wide-ranging public corruption charges
related to government-subsidized development projects in Dallas, Texas. We
AFFIRM the judgment of the district court.
FACTS AND PROCEEDINGS
A. Procedural background
*
District Judge of the Southern District of Texas, sitting by designation.
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The appellants were four of fourteen defendants indicted by a federal
grand jury on September 27, 2007. During the time period covered by the
indictment, roughly 2003 through 2005, Donald Hill was an elected member of
the Dallas City Council, representing a South Dallas district. City Council
members had the power to nominate members of a number of city commissions,
including the City Plan and Zoning Commission (“CPC”). On Hill’s nomination,
the City Council appointed D’Angelo Lee to the CPC in October 2003. Sheila
Farrington, Hill’s mistress and later his wife, purported to work as a consultant
using the business name Farrington & Associates. Darren Reagan was the
chairman and chief executive of the Black State Employees Association of Texas
(“BSEAT”) and the BSEAT Community Development Corporation (“BSEAT
CDC”).
The indictment alleged that the appellants had been involved in various
capacities in illegal schemes related to attempts by two housing developers,
Brian Potashnik and James “Bill” Fisher, to obtain public financing, zoning
clearance, and political support for their rival housing development plans in
Dallas. Specifically, Count 10 of the indictment charged Hill, Lee, and
Farrington with having conspired to solicit bribes from Potashnik, in violation
of 18 U.S.C. §§ 371 and 666. Counts 11 and 12 charged Hill and Lee with having
solicited bribes from Potashnik, in violation of § 666, and Farrington with having
aided and abetted the bribery. Count 15 charged Hill, Lee, Farrington, and
Reagan with having conspired to extort Fisher, in violation of 18 U.S.C. § 1951.
Count 16 charged Hill and Lee with extorting Fisher, in violation of § 1951, and
Farrington and Reagan with aiding and abetting that extortion. Count 17
charged Hill and Reagan with a separate instance of extorting Fisher, in
violation of § 1951. Count 18 charged Hill, Lee, and Farrington with honest
services fraud, in violation of 18 U.S.C. § 1346. Count 19 charged Hill, Lee, and
Farrington with having conspired to commit money laundering, in violation of
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18 U.S.C. § 1956(h), with respect to the funds obtained from bribery. Count 20
charged Hill and Reagan with the same with respect to the funds obtained from
extortion.
The appellants proceeded to trial, which commenced on June 22, 2009, and
stretched over the course of 47 days, concluding on September 23.1
B. Summary of the evidence
Among many other witnesses, both Fisher and Potashnik testified for the
Government at trial. Fisher had cooperated extensively with the FBI during the
investigation, while Potashnik had been charged in the same indictment as the
appellants and pled guilty to a single count of conspiracy to commit bribery.
The Government’s evidence showed that, in order to obtain Hill’s political
support for his housing developments, Potashnik agreed to hire Farrington as
a community consultant. Potashnik regularly paid Farrington, through a bank
account set up in the name of Farrington & Associates, despite Farrington never
having done any work for him. Hill and Lee also demanded that Potashnik
involve various non-profit organizations in his developments, and these
organizations then remitted part of their fees to Farrington through her
Farrington & Associates account. Farrington used money from this account to
buy cars for Hill and Lee and made cash withdrawals from the account for Lee.
In return for Potashnik’s cooperation, Hill, among other acts, pushed the City
Council to approve a financing deal for one of Potashnik’s housing developments.
Lee also demanded that Potashnik agree to use a certain percentage of
minority labor in the construction of one of his developments. To that end, Lee
instructed Potashnik to hire a woman named Andrea Spencer as a minority
1
Of the other ten defendants named in the indictment, seven pled guilty. One, Rickey
Robertson, pled not guilty and was tried alongside the appellants but has not appealed the
judgment against him. Robertson was convicted on Counts 15 and 19. The final two
defendants pled not guilty and were tried separately.
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contractor. Spencer herself did no contracting work, but instead partnered with
a contractor named Ron Slovacek, a white male, to do the work she obtained as
a result of her minority contractor certification. Potashnik gave Spencer and
Slovacek an $800,000 concrete contract. Shortly thereafter, Hill pushed the City
Council for tax credit funding for two of Potashnik’s developments, and Lee
helped Potashnik obtain a permit to build a community center and swimming
pool at one of his developments. Slovacek eventually admitted to Spencer that
he was remitting 10% of every check he received through this scheme to Lee,
much of it through checks made out to Farrington.
Potashnik had further dealings with Lee and Hill with respect to a
proposal before the City Council that would have reduced the number of rent-
restricted apartments required in three of his developments.2 Potashnik told
Lee that he would work out a deal with Spencer and Slovacek on a new concrete
contract, despite their bid being $250,000 higher than competitors’ bids. In
return, Lee told Potashnik that he and Hill would ensure that the City Council
proposal passed and had a conversation with Hill in which he confirmed this
arrangement. When the measure failed to pass the City Council, Potashnik
refused to give the concrete contract to Spencer and Slovacek, and his
relationship with Lee and Hill irreparably broke down.
While these machinations with respect to Potashnik were ongoing, the
appellants were also involved in illegal schemes related to Potashnik’s rival,
Fisher. Beginning in August 2004, Reagan began asking Fisher for lump sums
of money and percentages of the general partner developer’s fee that Fisher
2
This measure would have made the expiration of the consent decree that settled a
number of public housing desegregation cases (the “Walker Consent Decree”) retroactively
applicable to Potashnik’s developments. The Walker Consent Decree had the effect of
requiring a certain percentage of highly-rent-restricted units in every subsidized affordable
housing project. See generally Walker v. U.S. Dep’t of Hous. & Urban Dev., 912 F.2d 819, 821-
23 (5th Cir. 1990).
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received on each of his developments. Reagan frequently referenced Hill in his
conversations with Fisher. Reagan indicated that, if Fisher involved Reagan in
his development plans, Reagan would ensure that Fisher would not have
problems with Hill and the City Council. Hill, on one occasion, also told Fisher
that he needed to work out his problems with Reagan in order to resolve issues
related to one of his developments.
On October 27, 2004, Fisher suffered a number of adverse zoning rulings.
A few days later, Lee asked Fisher to contribute money to fund Hill’s birthday
party. Fisher refused, and shortly thereafter a CPC vote affecting Fisher was
postponed. Reagan continued to make demands of Fisher, requesting that his
wife and parents be given community outreach jobs by Fisher. On November 10,
Fisher signed a contract for $100,000 with Reagan, and Hill then shepherded
through the City Council a motion to approve financing for one of Fisher’s
developments, Pecan Grove.
Then Fisher was called by two men, Rickey Robertson and Jibreel Rashad,
who had recently formed an entity called RA-MILL, LLC. Neither Robertson nor
Rashad had substantial prior experience as contractors. Robertson told Fisher
that Lee had referred him to Fisher and that RA-MILL was interested in serving
as a subcontractor on Fisher’s Pecan Grove project. Robertson later told Fisher
that Lee was a silent partner in RA-MILL and that, if Fisher hired RA-MILL,
Lee would speed approval for another one of Fisher’s projects, Dallas West
Village, through the CPC, after which Hill would support the project before the
City Council. Lee later helped bring Dallas West Village through the CPC
process.
On December 29, Fisher met with Lee and Hill to discuss ongoing zoning
issues. At that meeting, Lee and Hill encouraged him to sign contracts with RA-
MILL. The next day, Robertson and Rashad sent Fisher one-page contracts
obligating him to pay RA-MILL a fee of 10% of the total value of the projects
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they had proposed they be cut in on. This 10% fee would have amounted to
between $600,000 and $800,000. Fisher rejected the contracts, and Robertson
told him that Lee wanted the contracts signed before an upcoming CPC zoning
vote. A week later, on discovering that Robertson and Rashad were planning to
subcontract out all of the work that Fisher would give them, Fisher refused to
deal with them further. He then received two proposals from RA-MILL: either
he could give RA-MILL contracts for concrete and drywall work and pay an
initial contractor fee of $180,000, or he could pay RA-MILL 3% of the total
construction cost of his projects in return for RA-MILL not pursuing any further
work on them. Robertson told Fisher that Lee was in support of these proposals,
although Lee, fearing that he was being recorded, later denied that he had been
involved in their formulation.
Around this time, as the Pecan Grove project began to progress, Reagan
began invoicing Fisher for additional sums of money. Reagan told Fisher that
Lee and Hill had told him to coordinate his activities with respect to Pecan
Grove with RA-MILL’s. To this end, Fisher received invoices from Reagan
demanding $180,000 for RA-MILL for construction consulting services and
$30,000 for Reagan. Reagan told Fisher that if Fisher did not make the
payments Reagan would make a report to the City Council. After Fisher did not
pay the invoices, Hill delayed a City Council zoning vote on one of Fisher’s
projects.
On February 16, 2005, Reagan sent a letter to Fisher demanding 50% of
the developer’s fee for both the Pecan Grove project and the Dallas West Village
project for which Fisher was trying to get approval. Fisher estimated this
demand as amounting to $1.4 million per project. Reagan also named
subcontractors that he wanted Fisher to use. Fisher told Reagan that he could
not agree to these new terms, and in a phone call a few days later Reagan told
Hill that Fisher had been “waffling,” that he needed Hill to “pull it,” and that he
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had told Lee that “we gonna hold the line.” Hill responded that he was “waiting
to hear from you. I’m just waiting for you.”
Even though he had refused Reagan’s new terms, Fisher did pay Reagan
$22,500, through Reagan’s organization BSEAT, as partial payment on Reagan’s
previous invoices. The FBI then photographed Reagan giving Hill an envelope
containing $10,000 on February 22. Hill then gave $5,000 to Farrington, who
gave $2,500 to Lee in cash. As Hill continued to delay votes on Fisher’s Dallas
West Village development, Reagan continued to demand more money. Fisher
paid Reagan an additional $40,000 on March 7. The FBI photographed Reagan
giving $7,000 to Lee, and the next day $2,500 in cash was deposited into Hill’s
campaign account. Fisher continued to refuse to cut Reagan in on his
developer’s fees, though, and Hill continued to postpone votes on the Dallas West
Village development.
Finally, Fisher was put in touch with Kevin Dean, who owned an asphalt
company, and John Lewis, an attorney. Dean and Lewis told him that by
working with them he could get City Council approval for Dallas West Village.
On May 11, the day of a City Council vote on the Dallas West Village
development, Fisher signed an agreement with Dean’s company and signed a
contract with Lewis for legal work amounting to $250,000. After Fisher paid
Lewis $50,000 as an initial payment, Lewis text messaged Hill, “Everything is
signed! Approve the project!!!” That day, Hill successfully moved for zoning
approval for Dallas West Village in a City Council meeting.
C. Verdict and judgment
The jury deliberated from September 23 through October 5, 2009, before
returning its verdict. The jury found Hill, Lee, and Farrington guilty to Count
10 (bribery conspiracy); Hill and Lee guilty, and Farrington not guilty, to Count
11 (bribery); Hill and Lee guilty to Count 12 (bribery), and Farrington guilty to
aiding and abetting; Hill, Lee, Farrington, and Reagan guilty to Count 15
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(extortion conspiracy); Hill and Lee guilty to Count 16 (extortion), with
Farrington and Reagan guilty to aiding and abetting; Hill and Reagan not guilty
to Count 17 (extortion); Hill, Lee, and Farrington guilty to Count 18 (honest
services fraud); Hill, Lee, and Farrington guilty to Count 19 (conspiracy to
launder money); and Hill and Reagan not guilty to Count 20 (conspiracy to
launder money). The district court later entered a judgment of acquittal on
Count 18. The district court sentenced Hill to 216 months’ imprisonment, Lee
and Reagan to 168 months’ imprisonment, and Farrington to 108 months’
imprisonment.
DISCUSSION
The appellants appeal on numerous grounds. (A) All four challenge the
sufficiency of the evidence presented with respect to their various convictions.
(B) Reagan contends that his right to a speedy trial was violated. (C) Reagan
contends that the district court erred by not holding a hearing into potential
conflicts of interest among defense counsel and into alleged prosecutorial
misconduct. (D) Hill, Farrington, and Reagan argue that the district court erred
by sealing the courtroom during voir dire and during a post-verdict discussion
with a juror. (E) Reagan argues that the district court erred in permitting him
to waive a challenge to the Government’s purportedly racially discriminatory use
of peremptory strikes during jury selection. (F) Lee and Reagan challenge a
number of the district court’s evidentiary rulings, specifically its limiting the
scope of permissible cross-examination of Fisher and by allowing evidence
related to Reagan’s prior business dealings. (G) Reagan contends that the
district court judge should have recused herself because she presided over a
previous case involving Fisher. (H) Reagan contends that the district court erred
in failing to sever his trial from that of his co-defendants. (I) Hill and Farrington
charge that the Government committed prosecutorial misconduct during closing
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argument, necessitating a new trial. (J) Finally, Lee and Reagan challenge a
number of the district court’s sentencing decisions.
A. Evidentiary sufficiency
1. Standard of review
When a defendant raises a “sufficiency argument in a motion for judgment
of acquittal, we review the district court’s denial of that motion by examining the
evidence and all reasonable inferences drawn therefrom in the light most
favorable to the verdict, and asking whether a rational trier of fact could have
found guilty beyond a reasonable doubt.” United States v. Montes, 602 F.3d 381,
388 (5th Cir. 2010). “A jury is free to choose among reasonable constructions of
the evidence,” United States v. Bell, 678 F.2d 547, 549 (5th Cir. 1982), and “[o]ur
role does not extend to weighing the evidence or assessing the credibility of
witnesses,” United States v. Lopez, 74 F.3d 575, 577 (5th Cir. 1996).
When a defendant raises a sufficiency argument in a motion for a new
trial, we review the district court’s decision to grant or deny a new trial for “clear
abuse of discretion.” United States v. Robertson, 110 F.3d 1113, 1118 (5th Cir.
1997) (quoting United States v. Dula, 989 F.2d 772, 778 (5th Cir. 1993)). For a
district court to disturb a jury’s verdict and order a new trial, “[t]he evidence
must preponderate heavily against the verdict, such that it would be a
miscarriage of justice to let the verdict stand.” Id.
2. Bribery
It is illegal for any agent of a local or state government that receives in
excess of $10,000 from any federal program to “corruptly solicit[] or demand[] for
the benefit of any person, or accept[] or agree[] to accept, anything of value from
any person, intending to be influenced or rewarded in connection with any
business, transaction, or series of transactions of such . . . government . . .
involving any thing of value of $5,000 or more.” 18 U.S.C. § 666(a)(1)(B), (b).
Lee, Hill, and Farrington were all convicted under this section of conspiracy to
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commit bribery for their machinations with respect to Potashnik. Lee and Hill
were convicted of two substantive counts of bribery for the deals they arranged
first for Farrington and second for Spencer and Slovacek. Farrington was
convicted of aiding and abetting one of these instances of bribery. These three
defendants challenge the sufficiency of evidence presented against them on these
counts.
a. Hill
Hill challenges his convictions on Counts 11 and 12, the two substantive
bribery charges, and on Count 10, the bribery conspiracy charge, on the ground
that the evidence presented at trial failed to show that he intended to be
influenced to change his official conduct as a result of his knowledge of
Potashnik’s payments to Farrington, Spencer, and Slovacek. Furthermore, he
argues that the evidence presented at trial was consistent with him being a mere
bystander “to Lee’s machinations.”
The evidence presented at trial contradicts this framing of Hill’s role in the
conspiracy. Potashnik testified that he expected that Hill would take various
official actions in his favor as a result of the bribes he was paying, and Hill’s
actions support Potashnik’s view of the arrangement. Hill made a number of
votes favorable to Potashnik shortly after Potashnik agreed to make various
payments to Hill’s co-conspirators. For instance, while he had voted to postpone
a vote on one of Potashnik’s development proposals on October 13, 2004, Hill
voted in Potashnik’s favor on October 27, shortly after Potashnik made his first
payment to Farrington on October 22 and agreed to other concessions requested
by Hill and Lee. On January 4, 2005, after Potashnik awarded concrete
contracts to Spencer and Slovacek, Hill wrote letters to a Texas state agency
supporting tax credit financing for two of Potashnik’s developments.
Based on Potashnik’s testimony as to his own subjective belief and Hill’s
subsequent actions tending to confirm that belief, a reasonable jury could have
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inferred that Hill did in fact intend to be influenced in his official actions by
Potashnik’s bribery, and as a result Hill’s evidentiary insufficiency argument on
these counts is unavailing.
b. Farrington
Farrington asserts that there was insufficient evidence to convict her
either of conspiring to commit bribery or of aiding and abetting bribery. She
argues that she did not know that the conspiracy existed and thus could not
have joined it, and that she had no knowledge that the bribery was ongoing and
thus could not have aided and abetted it. She contends that she believed that
her contracts with Potashnik were for legitimate consulting services only.
The Government presented ample evidence tending to show that
Farrington knew that she was not engaged in a legitimate consulting business
in her dealings with Potashnik. In one recorded phone call between Farrington
and Hill, for example, Farrington stated that she was “just going to work [the
contract with Potashnik] like a real consultant,” implying that she was not in
fact “a real consultant.” Farrington communicated with Lee and Hill about the
status of the checks she was receiving from Potashnik, and they in turn
communicated with Potashnik about these checks. Furthermore, despite being
paid purportedly for consulting services, Potashnik testified that Farrington
never did any work for him, and that the only time he met with her after
retaining her as a “consultant” was on a single occasion when she tried to get
him to hire one of her associates. He stated that the only communications he
ever received from her were monthly summary invoices, which provided no
details as to what if any work she was doing, and on which his name was often
misspelled.
We conclude that the evidence presented against Farrington—namely her
communications with Lee and Hill and Potashnik’s testimony that she did no
actual work for him—was sufficient to allow a reasonable jury to find that she
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had knowingly joined the conspiracy and aided and abetted the substantive acts
of bribery.
c. Lee
Lee contends that the evidence presented against him on the bribery
counts was insufficient, as the Government introduced no evidence tending to
show a connection between the bribes paid and any federal money received by
the city of Dallas. He argues that the requirement of such a nexus is implied by
the Supreme Court’s decision in Salinas v. United States, 522 U.S. 52, 57-59
(1997).
Because Lee did not challenge this aspect of the Government’s case against
him before the district court, our review is for plain error only. See FED. R. CRIM.
P. 52(b). Under this or any other standard, Lee’s argument is precluded by the
Supreme Court’s decision in Sabri v. United States, in which the Court stated
“that not every bribe or kickback offered or paid to agents of governments
covered by § 666(b) will be traceably skimmed from specific federal payments,”
and held that the lack of a closer nexus requirement did not render the statute
unconstitutional or otherwise invalid. 541 U.S. 600, 605-06 (2004). Lee’s
argument is unavailing.
3. Money laundering
18 U.S.C. § 1956 prohibits a range of financial transactions involving the
proceeds of unlawful activity, including transactions designed “to conceal or
disguise the nature, the location, the source, the ownership, or the control of the
proceeds of specified unlawful activity,” id. § 1956(a)(1)(B)(i), or “to avoid a
transaction reporting requirement under State or Federal law,” id.
§ 1956(a)(1)(B)(ii). Similarly, 18 U.S.C. § 1957(a) prohibits engaging in a
monetary transaction involving criminally-derived property of a value greater
than $10,000. 18 U.S.C. § 1956(h) prohibits conspiring to commit any offense
contained in § 1956 or § 1957.
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Lee, Hill, and Farrington were convicted of conspiring to commit money
laundering under these subsections for transactions made via the Farrington &
Associates account, through which Farrington was receiving and disbursing
money from Potashnik, the non-profits Potashnik had included in his
developments, and a number of other sources.
Hill and Farrington challenge the sufficiency of the evidence supporting
their convictions under Count 19 for conspiring to launder money. They argue
that the money paid to Farrington did not constitute the proceeds of unlawful
activity at the time that it was deposited into the Farrington & Associates
account. They contend that, at the time of the deposits, the money had not
reached Hill, and the underlying bribery offenses had thus not yet been
completed. They further assert that the transactions undertaken, if anything,
constituted the bribery offenses themselves, and not an effort to conceal the
proceeds of those offenses.
These arguments are unavailing. Under § 666, a bribery offense is
completed as soon as a government agent “corruptly solicits or demands for the
benefit of any person . . . anything of value” with the requisite intent to be
influenced. § 666(a)(1)(B). As a result, a substantive count of bribery was
completed as soon as Hill solicited payments from Potashnik. By the time
Farrington received the payments they were the proceeds of this unlawful
activity. Moreover, the notion that Hill never received any money is incorrect,
as the Government presented ample evidence showing that he and Lee directed
Farrington’s deposits and withdrawals from the Farrington & Associates account
and therefore had constructive possession over the funds in that account. Under
our caselaw, a defendant can constructively possess funds in the money
laundering context once he has effective control over that money, even if it
remains in a third party’s account. See United States v. Nguyen, 504 F.3d 561,
570-71 (5th Cir. 2007).
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The Government also presented ample evidence that the purpose of the
Farrington & Associates account was to conceal the money being paid to the
appellants as a result of their unlawful activities. For example, Lee and Hill
managed the transfer of money into and out of the account, even though it was
nominally Farrington’s. On one occasion, Hill told Farrington to withdraw
$9,000 instead of $10,000 for Lee in order to avoid reporting requirements
triggered by the higher sum, which in and of itself constituted a violation of
§ 1956(a)(1)(B)(ii). Farrington & Associates money was used to buy a BMW for
Hill, which was left titled in the name of Farrington & Associates. Hill told
Farrington to say that the car was a “retainer” for her lawyer, even though this
was not true.
Based on this evidence, a reasonable jury could have inferred that Hill and
Farrington conspired to launder the proceeds of unlawful bribery through the
use of the Farrington & Associates account, in violation of § 1956(h).
4. Extortion
The Hobbs Acts prohibits, inter alia, the interference in interstate
commerce by extortion, with extortion defined as “the obtaining of property from
another, with his consent, induced by wrongful use of actual or threatened force,
violence, or fear, or under color of official right.” 18 U.S.C. §§ 1951(a), (b)(2).
The Government alleged two theories of Hobbs Act liability: that the appellants
had conspired to obtain and had obtained money from Fisher through the use of
fear, or alternatively that they had done so under color of official right. “‘Fear
of economic loss’ may underlie extortion” charges so long as the loss is
particularized and not merely a loss of a prospective future benefit, United
States v. Rashad, 687 F.3d 637, 642 (5th Cir. 2012) (quoting United States v.
Edwards, 303 F.3d 606, 635-36 (5th Cir. 2002)), and private individuals can be
convicted for extortion “under color of official right” when they “conspire[] with
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corrupt public officials, masquerade[] as public officials . . . or [speak] for a
public official,” id. at 643.
a. Hill, Lee, and Reagan
Hill, Lee, and Reagan challenge the sufficiency of the evidence supporting
their convictions on Count 15, which charged them with conspiring to commit
extortion, and Count 16, which charged Hill and Lee with extortion and Reagan
with aiding and abetting extortion, all pursuant to the Hobbs Act.
They advance various arguments for why the evidence presented was
legally insufficient, including that their actions were merely “hard bargaining”
with Fisher, any payments they obtained were not received “under color of
official right,” Fisher voluntarily associated himself with Reagan, there were
legitimate reasons for opposing Fisher’s proposed developments, Fisher was
never threatened with a complete shutdown of his business, Fisher only stood
to lose a prospective economic benefit, and Fisher was successful despite their
actions.
We reject these characterizations of the relationship between the
appellants and Fisher. The evidence presented at trial, including Fisher’s
testimony, amply demonstrated that Fisher signed his contracts with Reagan
out of fear of the economic loss that would result from Hill and Lee taking
further action against him, and that he stood to lose significant investments he
had already made in his affected development projects, Pecan Grove and Dallas
West Village. Fisher testified that Lee told him that if he did not make certain
payments his developments would be held up, and Lee and Hill did in fact vote
against Fisher and delay various votes related to his projects. Reagan, Lee, and
Hill communicated about the status of Fisher’s payments to Reagan and the
need to “hold the line” until Fisher complied with Reagan’s demands. On
February 22, 2005, and on March 7, 2005, the FBI photographed Reagan passing
cash to Hill and Lee after he received payments from Fisher through BSEAT.
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This evidence, considered along with the rest of the trial record, amply
supports the jury’s verdict that Hill, Lee, and Reagan conspired to obtain money
from, and did in fact succeed in obtaining money from, Fisher as a result of his
fear of economic loss if he did not comply with their demands, or under color of
official right.3
Lee and Reagan also argue for the first time on appeal that the
Government did not introduce sufficient evidence of the transactions’ impact on
interstate commerce to meet the Hobbs Act’s jurisdictional nexus. However,
they stipulated to this element at trial and agreed to a jury instruction stating
that they had stipulated to it. The presence of such a stipulation defeats any
evidentiary insufficiency argument with respect to the interstate nexus element.
United States v. Branch, 46 F.3d 440, 442 (5th Cir. 1995) (“Once a stipulation is
entered, even in a criminal case, the government is relieved of its burden to
prove the fact which has been stipulated by the parties. . . . Appellant . . . cannot
now claim that the government failed to offer evidence on an element to which
he confessed.”).
b. Farrington
Farrington also challenges the sufficiency of the evidence supporting her
conviction under Count 16 for having aided and abetted the extortion of Fisher.
She argues principally that there was no evidence introduced showing that she
even knew of any extortion scheme, much less formed the requisite intent to aid
and abet it, that she did not in fact aid and abet any extortion scheme, and that
any extortion scheme was completed prior to any of her related acts, rendering
her aiding and abetting any extortion scheme a legal impossibility. These
arguments are unavailing in light of the evidence presented at trial.
3
We have already upheld the extortion conspiracy conviction of one of the appellants’
co-conspirators, Jabreel Rashad, who was tried separately, on these two grounds on the basis
of a similar evidentiary record. Rashad, 687 F.3d at 642-43.
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Documents related to the extortionate conduct directed at Fisher were
found in Farrington’s apartment. Specifically, authorities found a BSEAT
invoice that Reagan had sent to Fisher, along with copies of the contracts
Reagan had attempted to get Fisher to sign, a letter from Reagan to Fisher
relating to these contracts, and a copy of a check Fisher had given to Reagan.
Additionally, on February 22, 2005—less than two hours after Reagan, who had
just received $22,500 from Fisher through BSEAT, passed Hill $10,000 in cash—
Farrington deposited $5,000 that she received from Hill into the Farrington &
Associates account. Farrington then gave $2,500 to Lee.
Based on the documents and her close relationship with Hill and Lee, a
reasonable jury could have concluded that she was aware of the extortion
scheme. A reasonable jury could also have concluded that she knowingly served
as a conduit for the transfer of money between Reagan, Hill, and Lee. Because
the extortion scheme involved payments to Hill and Lee to forestall their taking
negative actions against Fisher, a reasonable jury could have concluded that the
extortion was not completed prior to the final payment to Lee and found that
Farrington had aided and abetted an act of extortion. As a result, we hold that
there was sufficient evidence to support Farrington’s conviction on this count.
5. New trial
Farrington moved the district court for a new trial based on the weight of
the evidence, pursuant to Federal Rule of Criminal Procedure 33. The district
court denied her motion, and she now argues that the district court’s decision
was an abuse of discretion. Because we hold that the evidence amply supported
Farrington’s convictions and that the evidence did not “preponderate heavily
against the verdict,” Robertson, 110 F.3d at 1118, we decline to find an abuse of
discretion in the district court’s denial of her motion for a new trial.4
4
Hill argues that he too should be granted a new trial, but concedes that he did not file
a motion requesting one. Because a “district court is ‘powerless to order a new trial except on
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B. Speedy trial
The Sixth Amendment provides that, “[i]n all criminal prosecutions, the
accused shall enjoy the right to a speedy . . . trial.” U.S. CONST. amend. VI. “The
Speedy Trial Act of 1974 provides that, in ‘any case in which a plea of not guilty
is entered, the trial . . . shall commence within seventy days’ from the later of (1)
the ‘filing date’ of the information or indictment or (2) the defendant’s initial
appearance before a judicial officer.” United States v. Tinklenberg, 131 S. Ct.
2007, 2010 (2011) (citation omitted) (quoting 18 U.S.C. § 3161(c)(1)). Reagan’s
initial appearance was on October 1, 2007, and his trial did not commence until
June 22, 2009, a gap of 628 days. Reagan contends that this delay in bringing
him to trial deprived him of his constitutional and statutory rights.
Reagan did not move for dismissal of his indictment before the district
court on the basis of a Speedy Trial Act violation, and he has therefore waived
his statutory claim. See 18 U.S.C. § 3162(a)(2); see also United States v.
Westbrook, 119 F.3d 1176, 1186 (5th Cir. 1997) (holding a Speedy Trial Act claim
waived when a defendant failed to join his co-defendant’s motion to dismiss the
indictment). Although the Supreme Court has held that a defendant does not
waive his constitutional right to a speedy trial by failing to raise it before the
district court, we consider constitutional speedy-trial arguments raised for the
first time on appeal for plain error only. See United States v. Serna-Villareal,
352 F.3d 225, 231 (5th Cir. 2003).
In assessing a defendant’s claim that he was deprived of his constitutional
right to a speedy trial, this court considers four factors: “Length of delay, the
reason for the delay, the defendant’s assertion of his right, and prejudice to the
defendant.” Barker v. Wingo, 407 U.S. 514, 530 (1972). “Once a speedy trial
the motion of the defendant,’” United States v. Nguyen, 507 F.3d 836, 838 (5th Cir. 2007)
(quoting United States v. Brown, 587 F.2d 187, 189 (5th Cir. 1979)), as a matter of law he
cannot be entitled to relief on this ground.
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analysis is triggered, the court ‘determines whether the first three Barker factors
weigh so heavily in favor of the defendant that prejudice is presumed.’” United
States v. Bishop, 629 F.3d 462, 465 (5th Cir. 2010) (quoting United States v. Frye,
489 F.3d 201, 209 (5th Cir. 2007)). In the absence of such a presumption, the
defendant must affirmatively demonstrate prejudice. See United States v.
Molina-Solorio, 577 F.3d 300, 307 (5th Cir. 2009).
With respect to the length of the delay, in United States v. Parker, 505
F.3d 323 (5th Cir. 2007), we held that delays of less than five years cannot alone
support a presumption of prejudice. Id. at 328-29. The second and third Barker
factors both militate against a presumption of prejudice: the delay was partially
attributable to Reagan’s requests for two continuances owing to the complexities
of the case, which the district court granted, see Cowart v. Hargett, 16 F.3d 642,
647 (5th Cir. 1994) (“Where the state advances valid reasons for the delay, or the
delay is attributable to acts of the defendant, this factor is weighed in favor of
the state.”), and Reagan never asserted his right to a speedy trial. Because none
of these factors supports a presumption of prejudice, and because the delay was
not long enough to require a presumption of prejudice by itself, we do not
presume prejudice. Reagan bore the burden of showing that he was prejudiced
by the delay in bringing him to trial. Molina-Solorio, 577 F.3d at 307. As
Reagan has not argued that he was actually prejudiced by the delay, his
constitutional speedy trial claim fails.
C. Conflict of interest/prosecutorial misconduct
We review a district court’s decision not to hold an evidentiary hearing
into an alleged conflict of interest for abuse of discretion. United States v. Garza,
429 F.3d 165, 171 (5th Cir. 2005). A district court’s decision as to whether such
a conflict actually exists is a legal question that we review de novo. Id. Where
a district court does find a conflict of interest between a defendant and his
counsel, it “must conduct what is commonly known as a ‘Garcia hearing’ to
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ensure a valid waiver by the defendant of his Sixth Amendment right.” United
States v. Garcia-Jasso, 472 F.3d 239, 243 (5th Cir. 2006) (citing United States v.
Garcia, 517 F.2d 272, 278 (5th Cir. 1975)).
During trial, Reagan made three allegations of conflicts to the district
court in pro se letters, and he asserts the district court should have held
hearings to investigate them. First, he contends that a conflict of interest
existed between him and Hill’s counsel, because Hill’s counsel was also
representing a man named Autry, who had, “with his gang dressed in law
enforcement uniforms, broke into, and invaded, Reagan’s home,” with the
complicity of law enforcement. Second, he alleges that he and Fisher had both
at times used the same attorney prior to that attorney’s death a few months
before the start of trial. Third, he asserts that the marriage of one of the
Government’s prosecutors to a partner at the law firm that represented Fisher
merited further investigation by the district court.
The district court did not abuse its discretion by failing to hold a Garcia
hearing into, or to otherwise investigate, any of these claims, as none presented
an instance of conflicted counsel that would have necessitated such a hearing on
Sixth Amendment grounds, or required an investigation with respect to any
other type of conflict of interest. First, even assuming that Hill’s attorney did
represent Autrey, and assuming that Autrey did in fact break into Reagan’s
home, there still was no conflict requiring investigation as Hill’s attorney at no
point represented Reagan. Cf., e.g., United States v. Holley, 826 F.2d 331, 334
(5th Cir. 1987) (discussing the potential for conflict arising from the appellant’s
counsel’s representation of both the appellant and his co-defendant). Second, the
fact that a now-deceased attorney represented Reagan and Fisher in other
matters prior to the trial did not implicate Reagan’s right to conflict-free counsel.
Cf. Perillo v. Johnson, 205 F.3d 775, 801-06 (5th Cir. 2000) (discussing the
conflict of interest present when a defendant’s trial counsel also represents a
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witness against the defendant). Finally, the mere fact that the prosecutor’s
husband worked at a firm that represented one of the witnesses did not create
a conflict, as Reagan did not show that the prosecutor or her husband had a
financial stake in the outcome of Reagan’s trial creating a conflict or requiring
her disqualification. Cf., e.g., United States v. Tierney, 947 F.2d 854, 864-65 (8th
Cir. 1991) (not requiring disqualification of a prosecutor whose husband’s firm
was representing an insurer with a financial stake in the outcome of the
defendant’s case because of the attenuated financial stake the husband himself
had in the outcome).
We hold that the district court did not abuse its discretion in not
investigating these claims further.
D. Courtroom closure
“Waived errors are entirely unreviewable, unlike forfeited errors, which
are reviewable for plain error.” United States v. Musquiz, 45 F.3d 927, 931 (5th
Cir. 1995). Hill, Farrington, and Reagan argue that the district court violated
the Sixth Amendment by allegedly sealing the courtroom during voir dire and
during a post-verdict discussion with a juror.5 They made this argument for the
first time in a motion for a new trial filed well after their trial had concluded and
over three months after the motion deadline had passed.6 We hold that the
defendants waived their right to a public trial with respect to the proceedings in
question. See United States v. Hitt, 473 F.3d 146, 155 (5th Cir. 2006) (“Where
5
The record is unclear as to whether the courtroom was actually sealed during the
periods in question.
6
The appellants claim that their failure to object contemporaneously to the alleged
closure of the voir dire proceedings should be excused by the Supreme Court’s decision in
Presley v. Georgia, 558 U.S. 209 (2010). Presley stands for the proposition that a criminal
defendant has a Sixth Amendment right to an open courtroom during voir dire. Id. at 213.
However, we had extended the ambit of the Sixth Amendment to cover voir-dire-related
proceedings well before Presley in United States v. Edwards, 303 F.3d 606, 615-16 (5th Cir.
2002), and nothing else in Presley excuses the appellants’ waiver of this issue.
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a defendant, with knowledge of the closure of the courtroom, fails to object, that
defendant waives his right to a public trial.”).
E. Batson challenge
Batson v. Kentucky holds impermissible the use of peremptory challenges
to exclude potential jurors on the basis of their race. 476 U.S. 79, 86-87 (1986).
At the conclusion of voir dire, Reagan lodged a Batson challenge because the
Government had used some of its peremptory challenges against black
veniremen. The district court asked the Government if it had race-neutral
explanations for each of the challenges in question. As the Government began
to respond, the district court called a pause in the proceedings, and the parties
conferred. At the conclusion of this brief conference, the district court stated on
the record that it understood that the parties had come to an agreement that, in
return for the Government’s agreement to replace one juror with another who
had been peremptorily struck, Reagan would waive his Batson challenge. Each
of the defendants and the Government accepted this arrangement on the record.
Reagan now argues that the district court’s acceptance of this
arrangement was reversible error necessitating vacatur and retrial. However,
when a defendant withdraws a challenge to a jury’s make-up, he waives his
objection thereto. Musquiz, 45 F.3d at 931-32 (so holding in the context of a
challenge of a juror for cause). Because Reagan withdrew his Batson challenge,
it is waived and unreviewable on appeal. Id. at 931.
F. Evidentiary rulings
1. Standard of review
“Evidentiary rulings are reviewed for an abuse of discretion, subject to
harmless-error analysis.” United States v. Crawley, 533 F.3d 349, 353 (5th Cir.
2008). “We review alleged violations of a defendant’s Sixth Amendment
confrontation right de novo . . . subject to harmless error review.” United States
v. Skelton, 514 F.3d 433, 438 (5th Cir. 2008) (citations omitted).
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2. Fisher cross-examination
Lee and Reagan contend that the district court violated their rights under
the Confrontation Clause by prohibiting cross-examination of Fisher about a
bank fraud case that he had been involved in during the 1990’s, in which he was
at first convicted but then had his verdict overturned on appeal. See generally
United States v. Fisher, 106 F.3d 622 (5th Cir. 1997). Fisher was acquitted on
retrial and later sued the Government for malicious prosecution.
Lee and Reagan argued to the district court that information about this
case should have been allowed in evidence because it related to Fisher’s
understanding of how investigations proceeded. They argued that this
knowledge could have indicated that Fisher’s cooperation with the Government
was a deliberate effort at gaining an advantage over his rival, Potashnik. The
district court ruled that this connection was far too tenuous to support the
inclusion of Fisher’s legal history in the trial and excluded it as either irrelevant
or excludable under Federal Rule of Evidence 403. See United States v. Perez-
Solis, 709 F.3d 453, 464 (5th Cir. 2013) (“Rule 403 provides that ‘[a]lthough
relevant, evidence may be excluded if its probative value is substantially
outweighed by the danger of unfair prejudice.’” (quoting FED. R. EVID. 403)).
“[T]rial judges retain wide latitude insofar as the Confrontation Clause is
concerned to impose reasonable limits on . . . cross-examination based on
concerns about, among other things, harassment, prejudice, confusion of the
issues, the witness’ safety, or interrogation that is repetitive or only marginally
relevant.” Delaware v. Van Arsdall, 475 U.S. 673, 679 (1986). The district
court’s decision to restrict inquiry into an investigation over a decade old that
resulted in no conviction of the witness in question, in light of the highly-
attenuated conspiracy-theory-like argument as to its relevance was not in error.
The district court did not abuse its discretion under Rule 403, and the district
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court’s decision in that respect did not violate the appellants’ Confrontation
Clause rights
3. West Cliff Mall
Reagan also argues that the district court erred in admitting evidence and
testimony about how he had committed fraud during the sale of a shopping
center, the West Cliff Mall, which he had been involved in developing. Federal
Rule of Evidence 404(b)(1) provides that “[e]vidence of a crime, wrong, or other
act is not admissible to prove a person’s character in order to show that on a
particular occasion the person acted in accordance with the character.” FED. R.
EVID. 404(b)(1). Reagan contends that admission of the evidence regarding the
West Cliff Mall was an abuse of discretion under Rule 404(b).
The West Cliff Mall was of great importance to Reagan’s defense. He
repeatedly pointed to BSEAT’s involvement with the West Cliff Mall project as
showing that BSEAT was a legitimate organization with deep ties to the
community. In response, the Government introduced documentary evidence in
the form of a contract relating to the mall and a transcript of a phone recording
between Reagan, his business partner, and his partner’s wife, both of which
indicated that Reagan and his associates were planning to defraud the principal
investor in the mall. Reagan consented to the admission of this documentary
evidence.
The Government then proceeded to question Reagan’s partner about the
West Cliff Mall scheme, and Reagan objected, arguing that the testimony was
excludable under Rule 404(b)(1). The district court held that Reagan had waived
his objection by consenting to the admission of the documents, or, alternatively,
that the evidence was admissible under the exception in Rule 404(b)(2), which
allows for the use of evidence barred by Rule 404(b)(1) for the limited purposes
of “proving motive, opportunity, intent, preparation, plan, knowledge, identity,
absence of mistake, or lack of accident.” The district court then issued an
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instruction to the jury limiting their consideration of the West Cliff Mall
evidence to the purposes allowed by Rule 404(b)(2).
On appeal, Reagan contends that the West Cliff Mall evidence was
irrelevant with respect to any issue other than Reagan’s character and should
have been excluded under Rule 404(b). However, even if Reagan is correct, he
would still have to demonstrate that any error in this regard was not harmless.
See Crawley, 533 F.3d at 353. Because a district court’s issuance of a limiting
instruction “greatly minimize[s]” the risk of undue prejudice posed by an
erroneous admission under Rule 404(b), id. at 355, and because the evidence
presented at trial supporting the jury’s verdict was substantial, see United States
v. Hale, 685 F.3d 522, 539 (5th Cir. 2012), we fail to see how any error in
admitting the West Cliff Mall evidence was not harmless.
G. Judicial disqualification
For the first time on appeal, Reagan challenges the decision by the trial
judge not to recuse herself sua sponte in light of the fact that she had presided
over the malicious prosecution suit that Fisher filed after he was acquitted in his
bank fraud retrial. “Any . . . judge . . . of the United States shall disqualify
himself in any proceeding . . . [w]here he has . . . personal knowledge of disputed
evidentiary facts.” 28 U.S.C. § 455(a). Reagan argues that the judge’s
involvement in that case casts doubt on her impartiality because of the
knowledge of Fisher she gained as a result. However, “[a]s a general rule, for
purposes of recusal, a judge’s ‘[p]ersonal knowledge of evidentiary facts means
extrajudicial,’ so ‘[f]acts learned by a judge in his or her judicial capacity
regarding the parties before the court . . . cannot be the basis for
disqualification.’” Conkling v. Turner, 138 F.3d 577, 592 (5th Cir. 1998) (second
and third alterations in original) (quoting Lac Du Flambeau Indians v. Stop
Treaty Abuse-Wis., 991 F.2d 1249, 1255-56 (7th Cir. 1993)). Because any
knowledge the judge may have had about Fisher was garnered in her judicial
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capacity, disqualification was not required by § 455, and we hold Reagan’s
challenge to be unavailing.
H. Severance
1. Standard of review
We review for abuse of discretion the denial of a motion for severance.
United States v. Mitchell, 484 F.3d 762, 775 (5th Cir. 2007). Where a defendant
fails to move to sever, we review for plain error only whether the district court
should have nevertheless severed the case. United States v. Bernard, 299 F.3d
467, 475 (5th Cir. 2002). Under plain error review, we will reverse only where
there was (1) an error, (2) that was clear and obvious, (3) that affected the
defendant’s substantial rights, and (4) that, if not corrected, would seriously
affect the fairness, integrity, or public reputation of the judicial proceedings.
United States v. Olano, 507 U.S. 725, 730-37 (1993).
2. Analysis
Reagan alleges that the district court erred in denying his motion to sever
Count 18—an honest services fraud charge against Lee, Hill, and Farrington—
from the rest of the trial. While Lee, Hill, and Farrington were all convicted on
Count 18, the district court granted each of them a judgment of acquittal after
trial. The Government claims that Reagan never made a motion to sever, and
Reagan does not indicate where in the record or when he made such a motion.
As a result, we review his claim for plain error only.
Reagan cannot show that his substantial rights were affected by the
district court’s failure to sever this count from the remainder of the trial. The
district court properly instructed the jury to consider each charge and each
defendant separately and individually, and the jury did in fact acquit some of the
defendants on various counts, including Reagan himself on one of the
substantive extortion counts. We have previously held that the issuance of such
instructions, which a jury is presumed to follow, militates against spillover
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prejudice from a failure to sever. See United States v. Owens, 683 F.3d 93, 99
(5th Cir. 2012). We have also held that a jury’s decision to acquit a defendant
on some of the charges against him indicates that the defendant was not
prejudiced by evidentiary spillover. See United States v. Arledge, 553 F.3d 881,
896 (5th Cir. 2008). Thus, to the extent that the district court erred in not
severing the honest services fraud charge from the remainder of the trial,
Reagan cannot show that his substantial rights were affected, and his claim is
unavailing.
I. Closing argument misconduct
1. Standard of review
“Counsel is accorded wide latitude during closing argument.” United
States v. Rodriguez, 43 F.3d 117, 123 (5th Cir. 1995) (quoting United States v.
Willis, 6 F.3d 257, 263 (5th Cir. 1993)). Although a “prosecutor is confined in
closing argument to discussing properly admitted evidence and any reasonable
inferences or conclusions that can be drawn from that evidence,” United States
v. Mendoza, 522 F.3d 482, 491 (5th Cir. 2008), “[r]eversal based on improper
argument by the prosecutor is not called for when there has not been a strong
showing of a deleterious effect upon the right to a fair trial.” Rodriguez, 43 F.3d
at 124. “The closing argument must be analyzed in the context of the entire trial
to determine whether it affected substantial rights of the accused.” Id. “When
analyzing the impropriety of prosecutorial comments, the central issue for this
court is ‘whether the prosecutor’s remarks cast serious doubt on the correctness
of the jury’s verdict.’ This step ‘sets a high bar.’” Rashad, 687 F.3d at 643
(citation omitted) (quoting United States v. Gracia, 522 F.3d 597, 603 (5th Cir.
2008)). When “there are no timely objections to statements made by the
prosecution, this court reviews them for plain error.” Id. at 643.
2. Analysis
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During the closing argument, the only objection made was to a comment
made by the Government during its rebuttal that Hill and Farrington claim was
improper bolstering of witnesses’ credibility. The objection followed the
Government’s statement that Potashnik’s wife Cheryl had been given a choice
as to whether to plead guilty to Count 10, the bribery conspiracy count, or a
different charge, a fact that was not in evidence. The appellants contend that
this improperly bolstered the credibility of Government witnesses because it
added the personal “imprimatur” of the prosecutor to the plea deals struck,
including those entered into by Brian and Cheryl Potashnik, who testified
against the appellants.
However, immediately after this statement and the appellants’ resultant
objection, the district court reminded the jury that “you’re bound to the evidence
that you have heard, and you will recall what it was.” “[T]he district court can
‘purge the taint of a prosecutor’s prejudicial comments’ with a cautionary
instruction, even, in some cases, one that is ‘merely generic.’” United States v.
Turner, 674 F.3d 420, 439-440 (5th Cir. 2012) (quoting United States v. McCann,
613 F.3d 486, 496-97 (5th Cir. 2010)). In light of this instruction, we decline to
hold that the prosecutor’s objected-to statement “cast serious doubt on the
correctness of the jury’s verdict.” Rashad, 687 F.3d at 643 (quoting Gracia, 522
F.3d at 603).
Additionally, for the first time on appeal, Hill and Farrington challenge
numerous additional aspects of the Government’s argument, including that it:
(1) asked the jury to send a larger social message through their verdict and to
strike a blow against government corruption; (2) appealed to wealth and class
biases; (3) improperly focused on municipal layoffs; (4) improperly focused on
Hill and Farrington’s sexual relationship; (5) improperly expressed personal
opinion and beliefs; (6) misled the jury by misstating the distinction between
factual and legal conclusions; and (7) improperly referenced the defendants’
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exercise of their right to a jury trial. Because these were not raised before the
district court, we review these claims for plain error only. Rashad, 687 F.3d at
643.
We note at the outset that most of the specific statements that Hill and
Farrington have identified in these arguments were comprised of restatements
of “properly admitted evidence and . . . reasonable inferences or conclusions that
can be drawn from that evidence,” Mendoza, 522 F.3d at 491. That the
defendants disliked the facts that the Government chose to highlight, or the
inferential gloss that the Government chose to put on those facts, cannot be a
ground for reversal, in light of attorneys’ “wide latitude” in crafting their closing
arguments. Rodriguez, 43 F.3d at 123 (quoting Willis, 6 F.3d at 263).
To the extent that the appellants validly challenge aspects of the
Government’s closing argument, we note that the district court issued several
cautionary instructions to the jury that it was not to consider counsel’s
arguments as evidence. Furthermore, the Government’s case against the
appellants was strong. See supra Part A. We have previously held that the
curative effect of cautionary instructions and the strength of the Government’s
case are important facts in assessing the impact of a claim of prosecutorial
misconduct. See United States v. Fields, 483 F.3d 313, 360 (5th Cir. 2007). We
fail to see the “deleterious effect upon the right to a fair trial,” Rodriguez, 43
F.3d at 124, in this instance required to warrant reversal, and we decline to find
plain error in the Government’s closing argument as a result.
J. Sentencing
1. Standard of review
We review a district court’s sentencing decisions under a deferential
abuse-of-discretion standard, first ensuring that the district court committed no
significant procedural error before assessing the substantive reasonableness of
the sentence imposed. See Gall v. United States, 552 U.S. 38, 51 (2007). We
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review a district court’s interpretation and application of the sentencing
guidelines de novo and its findings of fact for clear error. United States v.
Cisneros-Gutierrez, 517 F.3d 751, 764 (5th Cir. 2008) (citation omitted).
2. Loss calculation
Lee and Reagan both challenge the 18-point offense level increases
imposed by the district court based on its finding that their offenses implicated
a loss of more than $2.5 million. See U.S.S.G. §§ 2C1.1(b)(2); 2B1.1(b)(1)(J). The
district court found this loss threshold met on the basis of Reagan’s demand for
$2.8 million from Fisher through the two proffered BSEAT contracts that Fisher
rejected, which would have given BSEAT a 50% share in Fisher’s developer’s
fees.
Lee and Reagan argue that the district court’s finding was erroneous
because the benefit BSEAT would have actually derived from the contracts is not
ascertainable. As a result, they contend that the district court should have
replaced its loss calculation with a determination of actual gain. See
§ 2C1.1(b)(2). Because Fisher never agreed to Reagan’s more aggressive
demands, this amount would have been far less than $2.5 million.
We reject the appellants’ argument on this ground and hold that the
district court’s finding was not in error. The facts presented at sentencing
showed that Reagan had demanded contracts valued at $2.8 million from Fisher
and that the prospective value of those contracts was known to the conspirators.
Section 2C1.1 allows loss calculation on the basis of “the value of anything
obtained or to be obtained by a public official or others acting with a public
official.” It was not error for the district court to find that the value of
“anything” that would have been obtained by the public officials and those acting
with them as a result of the extortion conspiracy was in fact ascertainable and
would have been the $2.8 million-value of the contracts that the appellants
attempted to extort from Fisher.
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3. Supervisory role
Lee challenges the district court’s imposition of a further three-point
increase in his offense level on the basis of his having been a manager or
supervisor of criminal activity involving five or more participants. See U.S.S.G.
§ 3B1.1(b). Application note 4 to section 3B1.1(b) lists a number of factors that
tend to support a finding of manager status, including the defendant’s
participation in planning, recruitment of accomplices, and exercise of control and
authority over others. The facts presented at sentencing showed that Lee had
planned and coordinated the structure of the conspiracy’s takings from
Potashnik, had recruited Spencer into the conspiracy, and had exercised control
and authority over others on a number of occasions, including ordering the
disbursement of funds from Farrington’s account. We hold that the district
court’s finding that Lee was a manager or supervisor within the meaning of the
Guidelines was not in error.
4. Multiple acts
Finally, Reagan challenges the district court’s imposition of a two-point
increase in his offense level pursuant to U.S.S.G. § 2C1.1(b)(1) for his conviction
having involved more than one instance of extortion. Reagan contends that he
engaged in only a single overarching act of extortion. In light of the fact that
Reagan pushed Fisher into signing two separate contracts with him, attempted
to get Fisher to sign the two $1.4 million contracts that Fisher rejected,
attempted to get Fisher to hire his wife and parents, was involved in billing
Fisher for RA-MILL’s illusory work on the Pecan Grove development, and
attempted to have Potashnik sign a contract with him as well, we hold that the
district court had ample factual bases for determining that Reagan committed
multiple instances of extortion.
CONCLUSION
31
Case: 10-10211 Document: 00512330432 Page: 32 Date Filed: 08/02/2013
No. 10-10211
For the foregoing reasons, we AFFIRM the judgment of the district court
in all respects.
32