Justia White Collar Crime Opinion Summaries

Appellants, investors in a commodity pool, brought suit alleging that futures commission merchants violated the Commodity Exchange Act, 7 U.S.C. 1-27f, by aiding and abetting an investment pool operator in his scheme to defraud investors. The district court dismissed the complaint for failure to state a claim against the futures commission merchants. The court held that the district court acted properly in dismissing the investors' aiding and abetting claims where the merchants had no reason to know that the operator was operating as a commodity pool or trading on behalf of other investors, let alone that the operator was running a fraudulent Ponzi scheme. The court also held that, even if the merchants' actions could be construed as negligent, they were not severely reckless. Accordingly, the judgment of the district court was affirmed. View "Amacker, et al. v. Renaissance Asset, et al." on Justia Law

Defendant pleaded guilty to multiple crimes related to his conduct in running a fraudulent Ponzi scheme. The district court disregarded the plea agreement's recommendation of an applicable sentencing range of 151-188 months imprisonment and imposed the statutory maximum sentence of 360 months. Defendant argued that the Government breached the plea agreement by providing the district court with facts and arguments supporting a longer sentence than the parties agreed upon. The court held that the Government did not breach the plea agreement where the district court exercised its discretion by disregarding the plea agreement's recommendations and independently deciding to impose the statutory maximum sentence. The court also held that defendant waived his right to appeal the sentence on grounds that the district court abused its discretion in imposing the statutory minimum. Accordingly, the sentence was affirmed. View "United States v. Pizzolato" on Justia Law

Defendant, a state court judge and former criminal defense attorney, was convicted of two counts of wire fraud and one count of making false statements, stemming from defendant's use of his position as a state judge to obtain money and sexual favors in exchange for assisting a criminal defendant. Defendant subsequently appealed his conviction and his 60-month concurrent sentences. The court held that the district court did not abuse its discretion in denying defendant's motion for a new trial; based on the record, the court concluded beyond a reasonable doubt that the verdict would have been the same absent any error in the jury instructions and the indictment; and defendant's sufficiency of the evidence challenged failed. The court also held that the district court properly applied the specific offense characteristic; the second uncharged bribe could be used to increase the offense level for defendant's bribery conviction; and any monies rendered for legitimate legal services could not be subtracted from the loss value under U.S.S.G. 2C1.1(b)(2) because defendant and his colleague provided these services after the offense was detected. Therefore, none of defendant's several challenges required a new trial, reversal of conviction, or resentencing.View "United States v. Barraza" on Justia Law

This appeal arose from an earlier trial relating to the Enron scandal. The government alleged that Enron loaned out the stake in the barges that it owned off the Nigerian coast to Merill Lynch, risk-free and with a guaranteed return, but made it seem like a sale so that it could book a pretend profit. Defendant, a managing director at Merrill Lynch and the head of its Strategic Asset and Lease Finance group at the time of the transaction, challenged his convictions related to the sale on the grounds that the government violated his right to due process by withholding materially favorable evidence that it possessed pre-trial. The court affirmed and held that the district court did not clearly err in holding that the evidence at issue was not material.

Appellant, who was the Executive Director of the Poverty Point Reservoir District (PPRD), was convicted of extortion in violation of the Hobbs Act, 18 U.S.C. 1951, and sentenced to 18 months imprisonment where appellant used his position to coerce an independent contractor, who performed maintenance services for PPRD, into performing a myriad of jobs at appellant's home and farm while paying him with PPRD funds. At issue was whether the proof presented at trial constituted a constructive amendment of the government's indictment and whether the evidence was insufficient to show that appellant obtained property within the meaning of the Hobbs Act. The court held that there was no fatal variance between the indictment and the proof presented at trial where the government presented a single, consistent theory of conviction. While the independent contractor's labor was the only property relevant to the element of extortion, appellant's appropriation of both forms of property, the use of PPRD's funds and appropriation of the independent contractor's labor, was part of a single scheme. The court also held that the compensation paid to the independent contractor for his labor did not preclude a finding that appellant "obtained" property within the meaning of the Hobbs Act. Therefore, the evidence was sufficient to support the jury's verdict. Accordingly, appellant's conviction was affirmed.

Ernestine Girod, Una Favorite Brown, and Melinda Langley were each indicted on one count of conspiracy and multiple counts of healthcare fraud, and Brown and Girod were charged with three counts each of making false statements to law enforcement officers, all in relation to fraudulent Medicaid reimbursement claims made through A New Beginning of New Orleans, a Medicaid Early Periodic Screening Diagnosis and Treatment organization that provided minor, disabled Medicaid recipients with Personal Care Services. A jury convicted defendants on all but three of Langley's healthcare fraud counts. Brown, Girod, and Langley separately appealed their convictions and sentences on various grounds. The court discussed Brown's motion to dismiss the indictment due to prosecutorial misconduct; the sufficiency of the evidence supporting Girod's convictions; Girod's sentencing enhancements; and testimony of Langley's other acts. Accordingly, the court held that all the convictions and sentences were affirmed.

Fabian Muyaba, Joseph Mudekunye, and three co-defendants were charged in a 39-count indictment stemming from their tax-fraud conspiracy. Muyaba, Mudekunye, and one co-defendant were convicted in a joint jury trial. Muyaba challenged the sufficiency of the evidence to support his convictions; the district court's applying two Sentencing Guidelines enhancements; and its ordering part of his sentence to run consecutively. Mudekunye challenged the district court's failure to sever his trial from Muyaba's and his sentence as being procedurally unreasonable. The court held that, in light of the significant disparity between Mudekunye's sentence and the top of the correct Guidelines range and the absence of any evidence suggesting that the court would have sentenced him to 97 months imprisonment irrespective of the correct Guidelines range, Mudekunye had shown a reasonable probability of a lesser sentence and therefore, demonstrated that the district court's clear error affected his substantial rights. The court also held that the substantial disparity between the imposed sentence and the applicable Guidelines range warranted the exercise of the court's discretion to correct the error and Mudekunye's sentence was vacated and remanded for resentencing. Accordingly, the court affirmed the district court's judgment on every ground with the exception of Mudekunye's sentence.

This mandamus proceeding arose out of the public-corruption prosecution centering around former Dallas City Council Member Don Hill and various other members of Dallas city government who conspired to solicit and accept things of value in exchange for providing official assistance to Brian Potashnik in his pursuit of city approval and funding for various affordable-housing development projects. One of the things of value Mr. Hill and his coconspirators solicited was the award of construction subcontracts on Mr. Potashnik's developments to Ronald Slovacek. Petitioners, competitors of Mr. Potashnik who were seeking city approval of their own affordable-housing developments, sought restitution alleging that Mr. Slovacek and his coconspirators had rendered petitioners' $1.8 million investment worthless. At issue was whether the court should grant petitioners' writ of mandamus directing the district court to recognize that petitioners were crime victims within the meaning of the Crime Victims' Rights Act ("CVRA"), 18 U.S.C. 3771(d)(3), and the Mandatory Victims Restitution Act ("MVRA"), 18 U.S.C. 3663A. The court denied the petition and held that the district court was not clearly and indisputably wrong to find that petitioners failed to prove that they had been directly and proximately harmed by Mr. Slovacek's criminal conduct. The court also denied each of petitioners' pending motions.