United States v. Jonathan Woods

United States Court of Appeals
For the Eighth Circuit
___________________________
No. 18-3057
___________________________
United States of America
lllllllllllllllllllllPlaintiff - Appellee
v.
Jonathan Woods
lllllllllllllllllllllDefendant - Appellant
___________________________
No. 18-3058
___________________________
United States of America
lllllllllllllllllllllPlaintiff - Appellee
v.
Randell G. Shelton
lllllllllllllllllllllDefendant - Appellant
__________________________
National Association of Criminal Defense Lawyers
lllllllllllllllllllllAmicus on Behalf of Appellant(s)
____________
Appeals from United States District Court
for the Western District of Arkansas - Fayetteville
____________
Submitted: January 16, 2020
Filed: October 16, 2020
____________
Before KELLY, MELLOY, and KOBES, Circuit Judges.
____________
MELLOY, Circuit Judge.
A jury convicted defendants Jonathan Woods and Randell Shelton of several
crimes involving bribes and kickbacks using public funds. Woods and Shelton appeal
the district court’s1 denial of their motions to dismiss their indictments alleging due
process violations based on government misconduct—an FBI agent’s undisputedly
wrongful destruction of data on a laptop computer. They also appeal the district
court’s grant of a government motion in limine excluding evidence of the agent’s
misconduct pursuant to Federal Rule of Evidence 403. Finally, they appeal as to
several additional trial and pretrial issues. For the reasons set forth herein and in our
opinion in a co-conspirator’s companion case, United States v. Paris, 954 F.3d 1069(8th Cir. 2020), we affirm.
I. Background
A. The Conspiracy, Generally
The underlying conspiracy at issue in this case was possible because of a
provision of Arkansas law under which certain state revenues were set aside in a
1
The Honorable Timothy L. Brooks, United States District Judge for the
Western District of Arkansas.
-2-
“General Improvement Fund” (GIF) and earmarked for distribution essentially at the
direction of individual elected representatives. This relatively unchecked power led
to abuses. Exercise of this power, however, created a substantial “paper trail” as to
who sought funds, which elected officials advocated for the distribution of particular
funds, who received funds, and how portions of those funds were utilized as
payments to conspirators.
Woods was a state senator and Oren Paris III was the president of a small
college in northwest Arkansas, Ecclesia College. Shelton was a friend of Woods.
Micah Neal, a state representative, also participated in the conspiracy. Ultimately,
Ecclesia College received over $600,000 between 2013 and early 2015 at Woods’s
and Neal’s direction in exchange for kickbacks to Woods and Neal funneled through
a consulting firm, Paradigm Solutions, created by Shelton. In addition, Paris caused
Ecclesia College to hire a specific employee at Woods’s request at the outset of the
conspiracy.
Evidence of the conspiracy was overwhelming and included: email
communications directing applications for funds; the applications themselves; records
of public fund distributions; banking records tracing payments to and from Shelton’s
firm; the timing of the creation of Shelton’s firm; Shelton’s repeated withdrawals of
cash from his firm’s account; contemporaneous cash payments to other conspirators;
and large cash purchases by Neal and Woods contemporaneous with Shelton’s cash
withdrawals. For example, banking records from September 2013 showed Ecclesia
College paying Shelton $50,000 shortly after receiving $200,000 in public funds as
per Woods’s instruction. Banking records then showed Shelton depositing the money
in his own account and quickly transferring $40,000 to Woods’s account. On another
occasion, during December 2014 and January 2015, Ecclesia College paid Shelton
$65,000 after receiving $200,000 in public funds. Shelton deposited the check and
withdrew $56,200 in cash over the course of the following four days. Woods then
arranged a meeting between Shelton and Neal behind Neal’s family’s restaurant
-3-
where Shelton paid Neal $18,000 cash. Finally, the record is replete with examples
of Woods and Neal making large cash purchases close in time to Shelton’s cash
withdrawals, including furniture purchases or large payments on outstanding retail
loans to a jewelry store.
B. Investigation, Discovery, and the Destruction of Data
Upon discovery of the scheme, Neal and Woods cooperated with investigators.
Woods cooperated between November 2015 and March 2016, ceasing his cooperation
long before indictment. Neal began cooperating in January 2016, and in March 2016,
he began using a pen-style recording device to make secret recordings of
conversations with several co-conspirators, including Woods. Although he did not
make the recordings at the government’s instruction, he made the government aware
of the recordings. Neal’s attorney had purchased the pen recorder, and Neal
periodically took the pen recorder to his attorney’s office where a paralegal
downloaded its contents to her computer, cleared its memory, and returned it to Neal
for further use.
Eventually, government attorneys told investigators to obtain the recordings.
At Neal’s attorney’s instruction, the paralegal made the recordings available to the
government. In early November 2016, she placed files containing the recordings
from her computer on Dropbox, an online-file-and-storage-sharing service. She also
provided notice of the Dropbox account to the government’s lead investigator, FBI
Agent Cessario. Agent Cessario accessed the Dropbox account in early November
2016. In late November 2016, however, the paralegal discovered she had failed to
upload all of the digital recordings to Dropbox, and she added the files she initially
had missed. According to the paralegal, she did not expressly notify Agent Cessario
that she uploaded additional files, but she believed he would have received an
automatic notice of her activity directly from Dropbox.
-4-
In early 2017, Neal pleaded guilty to one count of conspiring to commit honest
services mail and wire fraud. In March 2017, the government indicted Woods, Paris,
and Shelton. In April 2017, the government turned over copies of Neal’s recordings
to defense counsel. Trial was scheduled for May 2017, but Woods moved
successfully to continue the trial until December 2017.
In fall 2017, as trial approached, defense attorneys received copies of text
messages between Neal’s attorney and Agent Cessario that seemingly referenced
recordings the defense attorneys had not received. This fact gave rise to suspicions
of discovery abuses and allegations the government was concealing recordings.
Ultimately, as explained below, neither the defense attorneys nor the government had
received the second batch of recordings the paralegal uploaded to Dropbox—the files
she uploaded in late November 2016. In addition, by November 2017, Shelton and
Paris had filed motions to dismiss their indictments for reasons unrelated to Neal’s
recordings, but the district court had not yet ruled on those motions. To sort through
the various arguments being raised, and to address the burgeoning discovery dispute,
the district court scheduled an evidentiary hearing and, again, continued the trial, this
time until April 2018.
In preparation for the hearing, prosecutors instructed Agent Cessario to deliver
his laptop computer for a forensics examination to determine what files he had
received and when he received them. At this point, the present cases suddenly
became much more complicated. Agent Cessario lied to his superiors, telling them
he previously had erased the laptop’s hard drive. Then, prior to delivering the laptop
for examination, he paid professionals to erase the laptop’s hard drive. He then
erased it a second time himself. Finally, he delivered the laptop to the FBI without
revealing his recent destruction of data. Later, when confronted, he admitted that he
destroyed laptop data after being asked to deliver the laptop for examination.
-5-
After learning of Agent Cessario’s actions, Woods, Paris, and Shelton filed
additional motions to dismiss alleging Cessario’s destruction of data amounted to
government misconduct rising to the level of a Fifth Amendment due process
violation. With these motions, the evidentiary hearing expanded to address not only
the question of what files the government had obtained and when it obtained them,
but also to address the question of what data Agent Cessario destroyed and how his
actions might relate to the pending cases. The district court heard testimony from
thirteen witnesses over the course of several days. Witnesses included Agent
Cessario, Agent Cessario’s supervisor, Neal, Neal’s attorney, that attorney’s
paralegal, a Dropbox employee, and forensics examiners. The government introduced
records of activity within the Dropbox account and a metadata analysis of the files
from the Dropbox account.
The district court found that Agent Cessario accessed the Dropbox account
shortly after the paralegal uploaded the initial batch of files (in early November
2016), but did not access the account again until November 2017 when it came to
light that additional files existed that the government had not turned over in April
2017. Testimony from Neal, Neal’s attorney, and the paralegal showed they had not
shared recordings with Cessario prior to November 2016.2 The district court
ultimately determined that, like the defense attorneys, the government had not
accessed the second batch of recordings until November 2017. Metadata analysis
showed that the recordings had not been changed between the time they were created
and the time they were shared with defense counsel—neither Agent Cessario nor
2
Neal’s attorney explained, however, that Neal would occasionally text him to
describe who or what he was recording. Neal’s attorney characterized these text
messages as “random information.” Neal’s attorney stated that on several occasions,
he forwarded the texts he received from Neal on to Agent Cessario. In addition, Neal
testified that he believed his attorney was forwarding the texts to Agent Cessario.
These texts were produced to the defense and appear to have been the texts that
aroused suspicions as to the possibility of missing recordings.
-6-
anyone else added, deleted, or modified the Dropbox files. Because defense counsel
ultimately received the files uploaded to Dropbox, the district court determined
defendants had obtained the files that Neal provided to his attorney’s office and that
were made available to the government.
The district court then addressed the question of Agent Cessario’s misconduct.
The court expressly found that Agent Cessario had not only lied to his superiors, but
lied to the court during his testimony. Agent Cessario testified that he had not lied
to his superiors when he initially claimed to have erased his hard drive at an earlier
date because he simply misunderstood the difference between erasing a hard drive
and taking lesser actions with a computer such as clearing the cache of an internet
browser. The district court found this testimony non-credible given Agent Cessario’s
later actions of paying to wipe the hard drive and then personally wiping the hard
drive. Agent Cessario also claimed he wiped the hard drive after being asked to turn
over his laptop because he wanted to conceal embarrassing medical evidence he had
stored on the computer in anticipation of a possible medical malpractice suit. The
district court reviewed the medical records and concluded nothing contained in the
records was sufficiently sensitive to credibly explain why Agent Cessario would have
placed his career in jeopardy and exposed himself to possible prosecution by
destroying data and lying to the FBI and the court. In rejecting Agent Cessario’s
story as to medical records, the district court speculated as to what was destroyed, and
stated: “Far more likely, in this Court’s mind, is that it was something that posed an
even greater risk to his job, public reputation, and liberty than was posed by his
decision to wipe the laptop.”
The court then addressed suggestions and arguments as to what might have
been on the laptop and how it might relate to the case. The court first noted that there
was nothing to suggest destroyed data might have been case related. The court
explained that the personal risk to Agent Cessario in the act of destruction far
outweighed any agent’s or prosecutor’s interest in the prosecution of a particular case.
-7-
The court also noted that defense counsel already had received the Neal recordings
from Dropbox. The court acknowledged the “theoretical possibility” that something
else case related might have been destroyed. The court was unable, however, “to
come up with any plausible scenarios” that might explain how defendants could be
prejudiced. The court emphasized that “[s]urely [Agent Cessario] was not falsifying
the financial and legislative records on which the Government will rely at trial, given
that the parties will simply subpoena the undoctored originals from the institutions
that maintain them.” The court rejected defense suggestions that the laptop might
have contained additional Neal recordings because the existence of any such
recordings and their presence on Cessario’s laptop would necessarily presume Neal
had gone behind his own attorney’s back, not merely behind the government’s back,
to create such recordings, get them to Agent Cessario, and conceal them from his
attorney. Finally, the court emphasized that (1) it previously had ruled that creation
of recordings was legal in that Neal acted of his own accord, and (2) the recordings
that the defendants actually received included statements from Woods denying
wrongdoing. As such, the court rejected the speculation that additional recordings
existed that defendants did not otherwise receive and that might have been
exculpatory.
Ultimately, the district court found a Fifth Amendment Due Process violation
based on Agent Cessario’s bad faith destruction of “potentially useful evidence” in
that the laptop contained “information . . . about the Dropbox account” that the parties
had sought in reference to the discovery dispute. However, the court concluded
“there is no evidence in the record to show and no good reason to believe, that [Agent
Cessario] destroyed any information that is material to the charges and defenses in
this case but not already in the Defendants’ possession.” As such, the court found
dismissal of the indictment unwarranted and not proportional to the harm, in that the
defendants were able to obtain by other means a record of Dropbox files and
activities. As a lesser sanction, the court precluded the government from introducing
-8-
in its case-in-chief any testimony from Agent Cessario or recordings made by Neal.
The district court did not preclude the defense from using such materials.
C. Motion in Limine and Motion to Continue
In a separate ruling, the district court granted a government motion in limine
to exclude evidence of Agent Cessario’s destruction of data as evidence whose
“probative value is substantially outweighed by a danger of . . . unfair prejudice,
confusing the issues . . . [or] wasting time.” Fed. R. Evid. 403. The government
argued in its briefing to the district court that Agent Cessario’s act of wiping his
laptop in December 2017 had no relevance to the charged crimes in the case
concerning a conspiracy to misuse public funds between 2013 and 2015. The
government argued that even if Agent Cessario’s misconduct were somehow relevant
to the pending criminal charges, evidence of his misconduct was substantially
outweighed by the risk of wasted time and prejudice arising from a “mini-trial
regarding [Agent] Cessario’s misconduct,” “[t]he likely effect” of which “would be
to divert the jury’s attention from the evidence regarding the bribery/kickback scheme
and to focus it on the unrelated misconduct of [Agent] Cessaro,” creating “the very
real possibility that the jury would improperly and unfairly discredit the
Government’s evidence at trial because of its dislike and disapproval of [Agent]
Cessario’s misconduct.” The defendants countered that examination of Agent
Cessario’s actions by the jury remained necessary to explore Neal’s credibility,
effectively cross-examine Neal, and show that the entire investigation and any
cooperators were potentially tainted by the actions of a corrupt lead investigator.
In granting the motion, the district court distinguished the issue of Neal’s
credibility from the issue of Agent Cessario’s bad acts. The district court emphasized
that the government was not seeking to preclude cross examination of Neal or
exploration of Neal’s motives for testifying. The district court noted that defendants
were free to ask Neal about: recordings he had made; his interactions with Agent
-9-
Cessario; who he gave his recordings to and when; and his motives for testifying. In
fact, the district court did not completely close the door on the possibility of allowing
the jury to hear about Agent Cessario’s bad acts. Specifically, the district court
stated: “[P]erhaps Mr. Neal’s responses to those questions will lay some presently
unforeseeable foundation to connect his testimony with Agent Cessario’s decision to
wipe the laptop. But on the record presently before the Court, the two simply do not
appear to have anything to do with each other.” Turning to the Rule 403 standard,
the district court described the danger of unfair prejudice as “obvious and extreme,”
given the possibility that jurors might direct their judgment towards punishing Agent
Cessario rather than weighing the evidence of the defendants’ guilt or innocence.
Finally, the court referenced the length of the evidentiary hearing that had already
occurred as to Agent Cessario and the potential for a similar “mini-trial” to confuse
issues and waste time.
Then, five days prior to trial, Paris pleaded guilty. Woods moved for another
continuance, asserting that Paris’s last minute plea disrupted trial planning and
preparation. In particular, Woods told the district court that he had planned a team
defense and was relying on Paris’s counsel to present certain witnesses. According
to Woods, Paris had denied, until pleading guilty, that he was involved in any
conspiracy. The district court denied the motion, emphasizing the lengthy delays that
had already occurred and noting the general foreseeability of a co-defendant’s
decision to plead guilty. Acknowledging Woods’s concerns about witnesses and
evidence, however, the district court allowed Woods to use Paris’s witnesses and
exhibits and ordered Paris’s counsel not to release any witnesses from subpoena.
Finally, the district court invited Woods to renew his motion if he could articulate
with greater specificity why a continuance was needed. Other than making a pro
forma renewal of all prior motions at the beginning of trial, Woods did not renew his
request for a continuance or present the district court with additional information or
arguments.
-10-
D. Trial: Jury Instructions, Questions, and Responses
Trial lasted nineteen days. As referenced at the outset of this opinion, evidence
was overwhelming, and testimony buttressed and explained extensive financial
records, public records, and electronic communications. Neal testified as to his role
in the scheme. Paris asserted his Fifth Amendment rights and did not testify. Shelton
asserted he served as a fund-raiser for Ecclesia College and received legitimate
payments for his work. He also asserted his payments to Woods were loans between
friends rather than kickbacks and bribes. Regarding Neal’s recordings and Agent
Cessario, Defendants identify nothing from trial to suggest they laid a foundation as
to Neal’s interactions with Agent Cessario that might have opened the door to
revisiting the district court’s exclusion of evidence concerning Agent Cessario’s
misconduct.
After submission of the case to the jury, the jury sent several notes to the court,
some of which were merely administrative. One note, however was substantive in
that it involved a jury instruction. Woods argues this note resulted in a prejudicial
and impermissible ex parte communication from the court to the jury. Shelton goes
further, arguing this same interaction served to constructively amend the indictment
(or permit conviction on evidence that varied from the indictment).
The jury instruction in question, Jury Instruction 7, set forth the elements of
Honest Services Wire Fraud.3 The first element of the offense, as set forth in the
3
In material part, this instruction stated:
It is a crime to use bribery or kickbacks in a fraud scheme that deprives
the public of its right to the honest services of a public official. Counts
2, 3, and 5 through 15 of the Second Superseding Indictment charge Mr.
Woods and Mr. Shelton with committing such a crime in the form of
Honest Services Wire Fraud. This crime has four elements, which are:
-11-
instruction, required the jury to find the defendant “voluntarily and intentionally
devised or participated in a scheme to defraud the public.” The instruction then
described the scheme as discussed throughout this opinion: Woods and Neal using
their positions to direct GIF monies to Ecclesia College in exchange for kickbacks
through Shelton. The “Definitions and Explanations” section of that same
instruction defined “scheme to defraud” as: “any plan or course of action intended to
deceive or cheat another out of the right to honest services where a bribe or kickback
is solicited, paid, or received in exchange for official action or an official act.”
One, the defendant voluntarily and intentionally
devised or participated in a scheme to defraud the public of
its right to the honest services of a public official through
bribery, which scheme to defraud is described as follows:
Mr. Woods, and later Micah Neal, agreed to use
their official positions as Arkansas legislators to
direct GIF monies to Ecclesia College in exchange
for bribes paid by Oren Paris III through Ecclesia
College, consisting of employment for Mr. Woods’s
friend Elizabeth Newlun and/or payments to Mr.
Woods and Mr. Neal through Mr. Shelton’s
company Paradigm Strategic Consulting LLC;
Two, the defendant did so with the intent to defraud;
Three, the scheme to defraud involved a material
false representation or concealment of fact; and
Four, the defendant used, or caused to be used, an
interstate wire facility in furtherance of, or in an attempt to
carry out, some essential step in the scheme.
-12-
During deliberations, the jury sent the district court a note specifically asking
a question about Element One of Jury Instruction 7. The jury asked:
When considering possible illegal activity:
1. Do monies have to flow to Ecclesia College and
2. Do payments have to be made to
3. Mr. Woods and
4. Mr. Neal
Is the paragraph in Element One a general description or specific criteria
that needs to be met?
In response to this question, the district court convened counsel for a hearing.
The court presented counsel with a proposed response, to which the government
acquiesced and to which Woods and Shelton objected. The proposed response stated
in material part that the jury did not have to find that money flowed to Ecclesia
College, Neal, or Woods and that the instruction’s detailed description of the scheme
was not itself a part of the elements that had to be proven. The response provided,
instead, that the narrative section of the instruction was merely a “general
description” of the scheme at issue.4
4
The proposed response as discussed in court with defense counsel stated (with
our emphasis added):
The paragraph of Element One that describes the alleged scheme to
defraud is a general description of the alleged scheme. In order for you
to find that the Government has proved Element One beyond a
reasonable doubt with respect to the particular Defendant and Count you
are considering, it is not necessary for you to find that payments were
actually made to any particular person or entity, and it is not necessary
for you to find that monies actually flowed to Ecclesia College. With
respect to Element One, you are simply being asked to determine
whether the Government has proved beyond a reasonable doubt that the
-13-
Woods and Shelton argued the jury needed to find the exchange of money with
Ecclesia College as an element of the offense. The district court concluded the
hearing by telling the attorneys it would arrive at final language and simultaneously
submit the language to the jury and notify counsel of the final language. Neither
party objected to this proposed procedure. The court then sent an answer to the jury
and copied the attorneys via email, using the language as presented to counsel at the
hearing (as set forth supra note 4) in all respects other than the substitution of the
word “summary” for the phrase “general description” and the word “summarized” for
the phrase “generally described.”
The jury returned its guilty verdicts two hours later. It found Woods guilty of:
one count of conspiring to commit honest services mail and wire fraud; twelve counts
of aiding and abetting honest services wire fraud; one count of aiding and abetting
honest services mail fraud; and one count of money laundering. The jury found
Shelton guilty of: one count of conspiring to commit honest services mail and wire
fraud; ten counts of aiding and abetting honest services wire fraud; and one count of
aiding and abetting honest services mail fraud.
Finally, Woods had moved for the district court judge to recuse himself from
the case in a pre-trial motion filed in January 2018. The district court denied the
particular Defendant you are considering “voluntarily and intentionally
devised or participated in a scheme to defraud the public of its right to
the honest services of a public official,” which scheme is generally
described in the paragraph you referenced. When determining whether
Element One has been proved beyond a reasonable doubt, bear in mind
the definition of the phrase “scheme to defraud” that appears in the first
paragraph of the “Definitions and Explanations” section of Final
Instruction No. 7, as well as the definition of “official action” or
“official act” that appears in Final Instruction No. 13.
-14-
motion in March 2018, prior to trial. We discuss additional facts concerning the
recusal issue in our analysis below.
II. Discussion
Shelton and Woods appeal the district court’s orders relating to Agent Cessario
including the denial of their motion to dismiss and the exclusion of evidence under
Rule 403. Woods challenges the denial of his motion for a continuance following
Paris’s plea. Both defendants challenge the district court’s handling of the jury
question as to Instruction 7. Finally, Woods challenges the district court’s denial of
his recusal motion.
A. Motion to Dismiss
“We review the decision denying dismissal of the indictment de novo and the
underlying factual findings for clear error.” Paris, 954 F.3d at 1071. We review the
district court’s fashioning of a remedy short of dismissal, such as the partial exclusion
of evidence or witnesses, for abuse of discretion, giving due deference to the district
court’s role in managing trials and discovery in criminal prosecutions. Cf. United
States v. Davis, 244 F.3d 666, 670 (8th Cir. 2001) (identifying government bad faith
and the degree of prejudice as factors to consider in determining a remedy for
government discovery abuse).
In Paris’s separate appeal, we addressed the district court’s denial of the motion
to dismiss the indictment based on Agent Cessario’s misconduct. See Paris, 954 F.3d
at 1073–75. To the extent Woods and Shelton present the same arguments, we reject
their arguments for the reasons stated in Paris. As described in Paris, our circuit
precedent may, as a “general rule,” require dismissal of an indictment on due process
grounds if, prior to bad faith destruction of evidence, that evidence has apparent
exculpatory value and that evidence cannot be obtained by other means. See id. at
-15-
1074 (applying United States v. LeBeau, 867 F.3d 960, 976–77 (8th Cir. 2017)). We
also noted that our circuit has applied these same requirements where destroyed
evidence was “potentially useful.” Id. (describing United States v. Webster, 625 F.3d
439, 446 (8th Cir. 2010)). Applying this general rule, we agreed with the district
court that Agent Cessario’s reprehensible conduct satisfied the bad faith requirement.
But we rejected Paris’s arguments on both remaining grounds—lack of apparent
exculpatory value and availability of the evidence by other means. We concluded:
(1) there was nothing to suggest Agent Cessario destroyed anything material to
Paris’s guilt or innocence; (2) strong evidence adduced at an extensive hearing
demonstrated the defendants had access to the Neal recordings and there was no
reason to suspect Agent Cessario had access to additional recordings not in the
defendants’ possession; (3) the case against Paris was built primarily on financial and
other records held by others and not subject to meaningful impeachment by the
agent’s wiping of a laptop he had used to access information the defendants already
possessed; (4) the entire issue of the recordings, Agent Cessario’s access to the
recordings, and his destruction of computer data was an issue tangential to the case;
and (5) there was nothing to suggest the motivation for Agent Cessario’s act of
destruction was related to the case at hand or a desire to gain a tactical advantage over
the defendants rather than for reasons personal to Agent Cessario. Id. at 1074–75.
These same considerations largely dictate the outcome in the present appeal.
To a limited extent, Woods and Shelton present slightly different arguments
than Paris. At the end of the day, however, any differences in their arguments can
best be characterized as slight variations in their challenges to the district court’s
underlying factual findings regarding the lack of apparent exculpatory value or the
availability of evidence by other means.
For example, Woods and Shelton place particular emphasis on evidence from
the evidentiary hearing tending to show a suspicious pattern of computer crashes, lost
pen recorders, possible meetings between Agent Cessario and Neal that were not
-16-
memorialized with official debriefing reports, and conflicting testimony as to how
many recordings might have been made. Based on this evidence, they assert the
district court committed error in its determination that the defendants, via Dropbox,
received all of the recordings Neal had made available to Agent Cessario. This same
evidence, however, was presented to the district court, and the district court weighed
this evidence alongside the testimony from Neal, Neal’s attorney, the paralegal, the
Dropbox employees, and forensic experts in reaching the conclusion that Agent
Cessario had not destroyed recordings other than what the defendants actually
received. Looking at all of the evidence, we find no clear error. United States v.
Boswell, 270 F.3d 1200, 1206 (8th Cir. 2001) (“We defer to the district court’s
factual findings with regard to the destruction of evidence.”).
By way of further example, Shelton in particular argues Neal’s testimony was
the lynchpin of the government’s case. According to Shelton, without testimony from
Neal, the government would have been unable to show that Shelton paid Neal or that
payments Shelton made to Woods were, in fact, kickbacks or bribes. Shelton had
characterized the payments to Woods as personal loans between friends unrelated to
the alleged scheme and unrelated to the contemporaneous receipt of public funds.
Shelton, therefore, characterizes evidence concerning Neal and Agent Cessario as
having apparent exculpatory value in that Shelton believes it would have aided him
in impugning Neal’s credibility.
We reject this argument, again, as failing to demonstrate clear error in the
district court’s factual assessment. As an initial matter, Shelton’s emphasis on the
importance of Neal’s trial testimony appears somewhat misplaced given the jury’s
ability to invoke common sense in reaching conclusions. See S.M. v. Lincoln Cnty.,
874 F.3d 581, 588 (8th Cir. 2017) (finding evidence sufficient to support verdict
where the evidence “gave the jury a common-sense basis for resolving an issue”). It
is somewhat doubtful that the jury required Neal’s testimony as a roadmap to reach
its conclusions. Regardless, even assuming Neal’s testimony—and therefore his
-17-
credibility—were critically important, the district court reasonably and expressly
determined that Neal had not made additional recordings behind his attorney’s back
for secret delivery to Agent Cessario. The district court also permissibly determined,
in the context of the case as a whole, that Agent Cessario’s unknown motivations for
destroying unknown computer data did not materially impugn Neal’s credibility.
Given the nature of the allegations in these cases, and the public and financial records
on which the prosecution built its case, we find no clear error in the district court’s
assessment.
Without more substantial independent arguments to distinguish their cases
from their co-conspirator’s case, Woods’s and Shelton’s arguments largely reduce to
the challenges we rejected in Paris.
Woods and Shelton also argue that, even if the district court did not err in
denying their motions to dismiss, the remedy imposed was inadequate and, if
anything, favored the government. To recap, the district court precluded the
government from calling Agent Cessario or introducing any Neal recordings as part
of its case in chief. The district court did not preclude the defense from calling Agent
Cessario or introducing Neal’s recordings. According to Woods and Shelton, the
government had no intention of using the recordings or calling Agent Cessario such
that the remedy imposed was no remedy at all.
Woods and Shelton’s argument concerning the particular remedy imposed is
a little confusing. At the end of the day, they do not clearly identify what other
remedy the district court should have imposed, other than a complete dismissal of
their indictments, and they do not claim to have suggested a lesser sanction to the
court below. In choosing a remedy, the district court cited a case from a different
context for the general proposition that the remedy imposed for a rights violation
must be commensurate in scope with the violation and must recognize not only the
defendant’s rights, but also the public’s interest in pursuing convictions. See United
-18-
States v. Blue, 384 U.S. 251, 255 (1966) (holding in the context of a presumed
violation of the right against self-incrimination that the proper remedy would be the
exclusion of evidence rather than the barring of prosecution because “numerous
precedents ordering the exclusion of such illegally obtained evidence assume
implicitly that the remedy does not extend to barring the prosecution altogether,” and
that “[s]o drastic a step might advance marginally some of the ends served by
exclusionary rules, but it would also increase to an intolerable degree interference
with the public interest in having the guilty brought to book”).
Here, we accept the district court’s finding that the evidence destroyed was
“potentially useful” in that it related to a discovery dispute. As we repeatedly
emphasized in Paris, and as the district court found below, however, there is simply
nothing to connect the dots between Agent Cessario’s destruction of his computer
data and the underlying cases against Woods, Shelton, Paris, and Neal, as proven
largely through records held by third-party custodians unrelated to and unaffected by
Agent Cessario. Given the tangential nature of the entire Agent Cessario debacle in
these prosecutions and given the independent nature of the actual evidence of the
underlying offenses, we find no abuse of discretion in the district court’s chosen
remedy.
B. Exclusion of Evidence Pursuant to Federal Rule of Evidence 403
“We review a trial court’s evidentiary rulings under an abuse of discretion
standard, giving substantial deference to a trial court’s exclusion of evidence under
Federal Rule of Evidence 403 so long as the trial court’s exercise of discretion ‘[does]
not unfairly prevent a party from proving [its] case.’” Wheeling Pittsburg Steel Corp.
v. Beelman River Terminals, Inc., 254 F.3d 706, 716 (8th Cir. 2001) (alterations in
original) (quoting White v. Honeywell, 141 F.3d 1270, 1274 (8th Cir. 1998)).
Exclusion of particular evidence is proper “if its probative value is substantially
outweighed by a danger of . . . unfair prejudice, confusing the issues . . . [or] wasting
-19-
time.” Fed. R. Evid. 403. “This court gives great deference to the district court’s
weighing of the probative value of evidence against its prejudicial effect.” United
States v. Tyerman, 701 F.3d 552, 563 (8th Cir. 2012).
In granting the government’s motion to exclude evidence of Cessario’s bad
acts, the district court made clear that it was not limiting the defendants’ ability to
question Neal as to his recordings, his motivations to testify, or his interactions with
Agent Cessario. And, as stated above, the district court did not completely close the
door on introduction of Agent Cessario’s bad acts assuming the defense could lay a
sufficient foundation for such evidence through Neal’s testimony. The defendants did
not do so. We find this meaningful in terms of whether the district court abused its
discretion among the range of choices available to it when crafting a ruling on the
government’s motion.
For all the reasons stated above, primarily due to the tangential nature of Agent
Cessario’s acts when viewed against the evidence in the case, we find no abuse of
discretion. We find no error in the district court’s assessment of potential prejudice,
confusion of issues, wasting of time, or in the balancing of these issues. The district
court fully explained the risk of prejudice, labeling as “obvious” the risk that the jury
would seek to punish Agent Cessario rather than fairly judge the evidence presented
at trial. Given the length of the evidentiary hearing that preceded trial, the length and
complexity of trial, and the possible confusion arising from potential expansion of the
trial into issues concerning Agent Cessario, the district court permissibly found
exclusion appropriate. To the extent the defendants continue to assert that Agent
Cessario’s bad acts reflect upon Neal’s credibility, we emphasize that Rule 403
demands not merely a relevancy test—it demands a balancing test and expressly
envisions that relevant evidence may be excluded. Even assuming Agent Cessario’s
tangential bad acts may be deemed relevant to Neal’s credibility, the district court
permissibly discounted this fact in the overall “weighing of the probative value of
evidence against its prejudicial effect.” Id.-20-
C. Denial of Motion for a Continuance
We review the denial of the motion for a continuance for a prejudicial abuse
of discretion. See United States v. Thurman, 368 F.3d 848, 851 (8th Cir. 2004).
Woods received a continuance of over seven months. The district court then
continued the case an additional four months due to the discovery dispute and
Agent Cessario issues. When Paris ultimately pleaded guilty, Woods offered the
district court little in the way of specific facts to explain why a codefendant’s plea
on the eve of trial required another continuance. And, as noted above, the district
court kept Paris’s witnesses under subpoena, allowed Woods to use Paris’s
exhibits and witnesses, and invited Woods to renew his motion if and when he
could offer more specific support.
Even assuming Woods did not waive this issue by failing to reassert his
motion with additional support, as invited by the district court, we conclude the
district court did not abuse its substantial discretion. First, a co-defendant’s last-
minute decision to plead guilty generally is foreseeable. Second, the underlying
facts in this case primarily came from 2013 through early 2015. When Woods
sought an additional delay in April 2018, he had already received a substantial
continuance followed by the additional delay brought on by the discovery dispute
and the need to investigate Agent Cessario’s actions. Notwithstanding ample time
to prepare for trial, and ample time to provide facts and details as to how denial of
the continuance might have prejudiced his defense, Woods fails on appeal to
identify with any specificity how he was harmed by the lack of a further
continuance. Finally, we note that although Paris pleaded guilty, (1) he asserted
his right not to testify, and (2) the government’s witness and exhibit list remained
unchanged. “[A] ‘district court’s discretion is at its zenith when the issue [of a
continuance] is raised close to the trial date.’” United States v. Chahia, 544 F.3d
890, 896 (8th Cir. 2008) (second alteration in original) (quoting United States v.
-21-
Whitehead, 487 F.3d 1068, 1071 (8th Cir. 2007)). Here, we find no abuse of this
substantial discretion.
D. Jury Question Responses
We understand the arguments as to jury instructions to encompass three inter-
related issues. We address them in turn.
First, to the extent Woods and Shelton argue Instruction 7 as originally given,
or as amended, misstated the law, we reject their argument. The offense of honest
services wire fraud does not require proof of payment or otherwise require proof of
consummation of the scheme. See, e.g., United States v. Jain, 93 F.3d 436, 441 (8th
Cir. 1996) (“Essential to a scheme to defraud is fraudulent intent. . . . The scheme to
defraud need not have been successful or complete. Therefore, the victims of the
scheme need not have been injured. However, the government must show that some
actual harm or injury was contemplated by the schemer.” (alteration in original)
(emphasis omitted)). Underlying all arguments as to Instruction 7, then, is the simple
fact that it was a proper instruction.
Second, to the extent Woods and Shelton argue the district court violated their
Sixth Amendment rights by engaging in ex parte communication with the jury, we
reject their argument due to a lack of prejudice. “[C]ommunications between the
judge and jury, absent counsel, violate the Sixth Amendment and are presumptively
prejudicial, but that presumption can be overcome by a lack of prejudice.” Shelton
v. Purkett, 563 F.3d 404, 408 (8th Cir. 2009); Stewart v. Nix, 972 F.2d 967, 971 (8th
Cir. 1992) (“Such presumption may be overcome, however, by a clear indication of
lack of prejudice.”). At the end of the day, the only ex parte component of the court’s
communication with the jury concerning Instruction 7 was the final delivery of the
amended instruction to the jury. The amended instruction was identical to the
proposed amended instruction as discussed with counsel during the hearing other than
-22-
the substitution of the words “summary” and “summarized” for the phrases “general
description” and “generally described,” respectively. In all other respects, the “trial
court . . . provide[d] the defense attorney with notice and a meaningful opportunity
to object before responding to [the] question asked by the jury.” Stewart, 972 F.2d
at 971. At the hearing the district court informed the parties that it intended to
finalize language and deliver the instruction to the jury with simultaneous emails to
counsel. Neither party objected to the proposed procedure as described in advance
by the court. The government characterizes the final, ex parte changes to the
instruction as de minimis and lacking any substance capable of prejudicing the
defendants. Woods and Shelton, in contrast, argue the jury’s quick return of a verdict
after receiving the instruction proves prejudice. We agree with the government in this
instance. We are unable to imagine how the de minimis substitution of phrases
altered the instruction in any material respect, much less prejudicially altered the
instruction.
Third, and finally, Shelton argues that, because evidence at trial included at
least one and possibly two other schemes, the failure to require the jury to make a
finding specifically as to the transfer of GIF funds created the possibility that Shelton
was convicted of participating in a scheme different from the GIF scheme at issue in
his indictment. Shelton characterizes this alleged error as a constructive amendment
of the indictment or, alternatively, as a conviction upon facts that varied from those
alleged in the indictment. See United States v. Stuckey, 220 F.3d 976, 981 (8th Cir.
2000) (“The basic difference between a constructive amendment and a variance is
this: a constructive amendment changes the charge, while the evidence remains the
same; a variance changes the evidence, while the charge remains the same.”). While
the remedies and consequences for constructive amendments or variances may differ,
we review de novo the underlying question of whether either one occurred below.
Id. (“Whether a variance exists, and, if so, whether that variance prejudiced [Shelton],
are questions of law that we review de novo.”); United States v. Hill, 835 F.3d 796,
799 (8th Cir. 2016) (standard of review as to constructive amendment).
-23-
Based on the details of what Shelton alleges concerning other potential
schemes, we reject his arguments. First, he identifies a scheme as alleged in a
separate count against Woods but not against Shelton in which Woods directed GIF
funds to an organization named Ameriworks in exchange for kickbacks from a man
named Cranford. Shelton was not alleged to have been involved in that scheme,
which was separately charged and was addressed in a separate jury instruction.
Further, the district court expressly and repeatedly informed the jury that evidence of
that separate scheme was to be considered only as to Woods. Finally, although
Instruction 7 as to Shelton did not require the jury to find consummation of the
scheme involving Paris and Ecclesia College, the instruction unambiguously
identified the scheme involving Paris and Ecclesia College as the scheme at issue in
the charges against Shelton. Instruction 7, as amended, therefore, reinforced for the
jury that the charges against Shelton focused on the Ecclesia College GIF scheme.
We find no constructive amendment and no potential for conviction based on a
variance as to unrelated facts addressing the separately charged scheme involving
Woods and Cranford.
Second, Shelton points to evidence involving medical marijuana legislation
that Woods and Paris discussed, and which Woods proposed. The legislative efforts
at issue, had they been pursued, would have led to a multi-year process resulting in
a voter referendum to amend the Arkansas Constitution. The connection between
Woods and Paris as to this legislation addressed the possible generation of tax
receipts for distribution to institutions such as Ecclesia College. Over objection, the
district court allowed this evidence of uncharged acts or transactions because it
tended to show Woods working to promote Ecclesia College. See United States v.
Maxwell, 643 F.3d 1096, 1100–01 (8th Cir. 2011) (noting government’s broad
leeway in admitting evidence tending to prove the other conspirators were “working
in concert”).
-24-
Shelton’s argument as to this evidence is less than clear. Even assuming this
evidence somehow could be construed as a distinct scheme rather than merely
evidence of cooperation among co-conspirators, the government did not urge
conviction of Shelton based upon any such scheme. Rather, as just noted, amended
Instruction 7—the focus of Shelton’s argument—specifically identified the GIF
scheme and did not reference any connection to medical marijuana. At the end of the
day, Shelton presents a confusing, composite argument that seemingly pulls together
arguments about: (1) ex parte communications, (2) an earlier refusal to sever the trial
to isolate the Woods-only count, (3) the failure to exclude evidence of the arguably
separate medical marijuana “scheme,” and (4) the failure to demand the jury find
money flowing to Ecclesia College as an element. None of these issues involved
error independently, and they do not involve error in combination. The instruction
and the response to the jury question were correct statements of law that very
specifically and clearly referenced the one scheme identified in the charges against
Shelton. The instructions and response did not broaden the indictment or empower
the jury to convict Shelton of a scheme other than the GIF scheme alleged in the
indictment. See United States v. Parker, 871 F.3d 590, 606 (8th Cir. 2017) (“A
constructive amendment of an indictment occurs when jury instructions broaden the
scope of an indictment by permitting a conviction for an uncharged offense.” (quoting
United States v. Spencer, 592 F.3d 866, 873 (8th Cir. 2010))).
E. Recusal
We review the denial of a motion for recusal for abuse of discretion. In re
Steward, 828 F.3d 672, 681 (8th Cir. 2016). “Any . . . judge of the United States shall
disqualify himself in any proceeding in which his impartiality might reasonably be
questioned.” 28 U.S.C. § 455(a). “[W]hat matters is not the reality of bias or
prejudice but its appearance.” Liteky v. United States, 510 U.S. 540, 548 (1994).
But, we presume a judge to be impartial, and a party moving for recusal bears the
“substantial burden of proving otherwise.” United States v. Minard, 856 F.3d 555,
-25-
557 (8th Cir. 2017) (quoting United States v. Ali, 799 F.3d 1008, 1017 (8th Cir.
2015)). And, “[o]pinions based on facts or events occurring in a judicial proceeding
‘do not constitute a basis for a bias or partiality motion unless they display a
deep-seated favoritism or antagonism that would make fair judgment impossible.’”
Minard, 856 F.3d at 557 (quoting Liteky, 510 U.S. at 555).
A few additional facts are necessary for discussion of this issue. Woods moved
for recusal in January 2018 alleging an appearance of bias based on several comments
the district court directed towards Woods’s attorney, several adverse rulings, and
revelation of the fact that the district court had viewed Woods’s counsel’s website.
Woods raised additional arguments in his motion but does not renew them on appeal.
On appeal, however, Woods expands his arguments, describing as improper the fact
that the district court conducted independent legal research into other cases in which
Woods’s counsel had been sanctioned. Woods also identifies instances from trial he
characterizes as further demonstrating bias. In particular, he alleges the district court
improperly made an objection for the government during defense counsel’s
questioning of a witness. In addition, he renews his challenges to the Agent Cessario-
related rulings and identifies those rulings as evincing bias.
As an initial matter, we note that Woods’s arguments as to this issue focus
largely upon the district court’s comments as directed towards Woods’s counsel.
Undeniably, but in our view understandably, counsel had gotten under the district
court’s skin to a limited degree through repeatedly interrupting the district court,
using salty language, and pushing—often aggressively—for rulings the district court
perceived as being aimed more at delay than at productive litigation of the case. In
ruling on the motion to dismiss, the district court issued a lengthy order, identifying
and discussing Woods’s various arguments, explaining the context for comments
Woods had identified, and explaining rulings that Woods alleged to be unfair. The
district court’s explanation of the several comments are consistent with the record.
In our view, the comments at issue, taken in context, do not remotely approach the
-26-
level needed to suggest impartiality. See Litkey, 510 U.S. at 555 (“[J]udicial remarks
during the course of a trial that are critical or disapproving of, or even hostile to,
counsel, the parties, or their cases, ordinarily do not support a bias or partiality
challenge. They may do so if they reveal an opinion that derives from an extrajudicial
source; and they will do so if they reveal such a high degree of favoritism or
antagonism as to make fair judgment impossible.”). The district court’s various
facially unbiased rulings largely speak for themselves, but the district court also
discussed several other rulings that, on balance, demonstrated even-handed and often
generous treatment of Woods.
Woods appears to place particular emphasis on the fact that the district court
admitted (1) conducting research and identifying a prior case in which Woods’s
counsel was sanctioned and (2) viewing Woods’s counsel’s website. The former,
while technically information not arising in the context of the present case, can hardly
be characterized as information from an extrajudicial source. Judges are free to—are
expected to—conduct legal research as they believe to be necessary in carrying out
their duties. And the latter is in no manner objectionable. Judges, as human beings
are necessarily interested in knowing who is practicing in their courtrooms. It is no
more objectionable for a judge to view a firm’s website than for a county seat lawyer
to be personally acquainted with a presiding judge. “We have emphasized that
‘[r]ules against bias and partiality can never mean to require the total absence of
preconception, predispositions and other mental habits.’” Ali, 799 F.3d at 1017
(alteration in original) (quoting United States v. Burnette, 518 F.3d 942, 945 (8th Cir.
2008)). Similarly we will not find bias in the natural and human curiosity that would
lead a judge to look at publicly available information as to an attorney’s experience
or manner of holding himself out to the public.
The final point meriting comment is Woods’s assertion that the district court
improperly imposed an objection on the government’s behalf. Woods’s argument in
this regard begins with the incorrect assumption that any such objection by the court
-27-
itself must be improper. That is not the law, in general, nor would we be inclined to
view one such objection as evincing bias during a nineteen-day trial even if such an
objection were inherently improper. See Fed. R. Evid. 611(a) (“The court should
exercise reasonable control over the mode and order of examining witnesses and
presenting evidence so as to: (1) make those procedures effective for determining the
truth; (2) avoid wasting time; and (3) protect witnesses from harassment or undue
embarrassment.”); Hale v. Firestone Tire & Rubber Co., 756 F.2d 1322, 1329–30 (8th
Cir. 1985) (judicial intervention for clarification not improper). Here, the objection
at issue was in response to defense counsel’s introduction of facts not in the record
through the means of a question, and was not an improper objection. Further, if in
the hustle and flow of a lengthy trial, a judge momentarily speaks up in the face of an
obviously improper statement by counsel, this slight deviation from the role of
passive observer is neither improper nor evidence of bias.
In any event, the record in the present case belies Woods’s assertion. The
official trial transcript shows that, at the point in question, the government rather than
the court raised the initial objection.5 We find no abuse of discretion in the district
court’s denial of the motion for recusal or actions at trial evincing a need for recusal
or disqualification.
We affirm the judgments of the district court.
______________________________
5
Woods unsuccessfully moved our court for a stay and remand to “settle the
record” seeking a hearing and review of trial recordings for comparison to the official
transcript. According to Woods, such review would have revealed the true story of
what occurred at trial and shown that the district court did, in fact, object prior to the
government. A panel of our court denied the motion. Woods now characterizes our
Court and the district court’s reporter as “prevent[ing]” him from proving the true
state of the record.
-28-