By Joe Magliolo

Hello again. Below are summaries from a variety of published Fifth Circuit cases from April 2025, along with a late addition from March. One benefit of releasing the April summaries in early June is that you get the Federal Reporter citations associated with each case, for those brave few who continue to purchase the physical volumes (for an impressive $8,000 a month!).

This month, the Court released opinions on several interesting issues, including tax fraud, an interlocutory appeal stemming from a mistrial prompted by alleged government misconduct, the Anti-Kickback Statute, the scope of SEC receiverships in securities fraud cases, restitution related to relevant conduct, the scope of plea agreements, a murder-for-hire case involving Rule 404(b), and other issues.

All opinions cited here are linked in the case title, and the bolded judge is the author of the Court’s opinion.

United States v. Earnest and Klish, No. 24-60118, 132 F.4th 905 (5th Cir. Mar. 31, 2025)

Issues: Tax Fraud, Rule 404(b), Summary Chats, Loss Amount, Constructive Amendments, Sufficiency of the Evidence, Mitigating Role Adjustment.

Chief Judge Elrod, Judge Jones, Judge Stewart) (from S.D. Mississippi).

The Fifth Circuit considered a range of issues stemming from the tax-fraud trial and sentencing of two former tax-preparers, Adam Earnest and James Klish. The defendants challenged evidentiary rulings at trial, whether the indictment was constructively amended, the sufficiency of evidence against them, and rulings that adversely affected their offense level at sentencing. The Fifth Circuit affirmed on all fronts.

Earnest and Klish were tax preparers at Sunbelt Tax Services (“Sunbelt”), and, before that, Earnest worked at American Tax Service (“American”).

While at American, in 2012 and 2014, the IRS audited many of Earnest’s returns and assessed him with multiple penalties for failing to provide supporting documentation for returns that sought certain education-related tax credits.

Earnest opened Sunbelt later in 2014, but he took steps to avoid having his name associated with the business by not filing returns under his own Tax Identification Number and instructing his employees, including Klish, to falsify documents to make them appear as if their clients had prepared them.

The tax scheme at Sunbelt involved preparing and filing over 4,500 tax returns claiming $4.8 million for a different type of education credit than they sought at American, for which the taxpayers were not eligible. They also included other fraudulent information on some returns, including for false donations and unreimbursed business income and expenses.

After trial for conspiring to defraud the United States by preparing and filing false tax returns, and assisting in the same, Earnest and Klish were convicted on all counts. The defendants challenged their offense levels on multiple fronts, which the district court rejected, and this appeal followed.

Earnest and Klish first argued the district court erred by permitting the government to use evidence of the conduct at American under Rule 404(b), because those acts took place prior to the conduct for which they were indicted, which took place at Sunbelt (Klish argued separately that he was prejudiced because he never worked at American). At trial, the government introduced multiple witnesses who testified about the false returns Earnest prepared at American, and Earnest claimed the evidence’s prejudicial value outweighed its relevance and did not fit within any Rule 404(b) exception. The Fifth Circuit disagreed, noting that the evidence was relevant to demonstrate intent, knowledge, and other 404(b) factors. Further, the district court gave multiple appropriate limiting instructions to the jury about the limited uses to which the evidence could be put, which also undermined Klish’s claim that he was subject to “guilt by association,” despite not working at American.

Earnest claimed the district court should not have permitted the government to use a summary chart of the over 4,000 fraudulent tax returns without supporting testimony from each taxpayer for whom those returns were prepared. The Court found the summary chart merely added up the number of returns, permissible under Federal Rule of Evidence 1006(a), and noted that requiring each person to testify would lead to undue delay and a waste of judicial resources.

The Court found there was no cumulative error as to Earnest, because he identified no errors in the government’s case.

Earnest then argued the government constructively amended his indictment, in violation of the Fifth Amendment. The grounds for this, according to Earnest, were that the government elicited testimony about his criminal conduct related to pre-Sunbelt activity back to 2010 and that the indictment stated he sought fraudulent “deductions” while the evidence was related to fraudulent “credits.” As to the first argument, the Court found the district court correctly instructed the jury that Earnest was only on trial for conduct from 2015 to 2022, and that they could only convict him for criminal conduct committed while at Sunbelt. The Court rejected the second claim, noting that the indictment (while mistakenly calling the credits “deductions” in one portion of the indictment) said the scheme involved illegally claimed “education credits.” Under plain error review, the Court found no error as to constructive amendment.

Earnest then claimed the evidence against him was insufficient on one count. The person for whom Sunbelt prepared the Count Seven-related tax return testified that Earnest and another employee prepared three of her returns. Though the other employee, not Earnest, was listed as the preparer on the relevant tax return, the jury heard evidence that Earnest often prepared and filed tax returns under the names of other Sunbelt employees, which permitted the jury to infer that Earnest actually prepared the fraudulent return at issue.

Earnest and Klish then turned to various sentencing issues. Earnest first argued that the district court erred by estimating the tax loss associated with his scheme as being between $3.5 and $9.5 million. The Court noted that the Sentencing Guidelines permit the sentencing district court to make a reasonable estimate, and it did so here based on Earnest’s inability to demonstrate any credit claims were legitimate against the evidence demonstrating that they were improper. The district court further revised the estimate downwards and did not include certain losses that were uncertain, and the Court affirmed its loss-amount finding.

The Court similarly found Klish was not entitled to a mitigating-role reduction, because he failed to establish the baseline culpability of the “average participant” in the scheme, nor could he show that he was less culpable than such a participant.

United States v. Breimeister, No. 23-20326, 133 F.4th 496 (5th Cir. Apr. 7, 2025)

Issues: Double Jeopardy, Mistrial, Government Misconduct, Healthcare Fraud, Preservation of Error.

Judge Haynes, Judge Duncan, Judge Wilson) (from S.D. Texas).

This interlocutory appeal emanated from a five-defendant healthcare-fraud trial where the government, five weeks into the trial, made late evidentiary disclosures that affected the testimony of prior witnesses. The district court ultimately determined a mistrial was necessary, and Breimeister moved to prevent a retrial on double-jeopardy grounds, which the court denied. On interlocutory appeal, the Fifth Circuit affirmed.

Breimeister and others were indicted for defrauding healthcare programs through pharmacies. In this alleged scheme, the defendants allegedly submitted false claims for a variety of products and prescription drugs, concealed the scheme, and defrauded more than $140 million from the healthcare programs.

During trial, an accountant testifying for the government indicated he prepared twelve summary exhibits based on bank records and other materials listed as government exhibits. Cross-examination, however, exposed “holes” in the witness’s methodology that raised concerns about the summary exhibits’ reliability. The district court then ordered the government to turn over the witness’s unredacted notes he created while preparing the exhibits.

Those notes conflicted with the witness’s testimony, as they demonstrated he had worked closely with the government to prepare the exhibits, that he relied on sources outside of the exhibits on the government’s exhibit list, including unproduced government files, and that the government instructed him what sources he should and should not cite on the summary exhibits.

Following this, the district court ordered the government to revisit its files and ensure all transcripts and notes of its witnesses had been turned over. The government then disclosed additional notes and reports for witnesses who had testified and those who were scheduled to.  After further review, the government disclosed even more evidence concerning witnesses who had already testified.

The district court considered a range of potential relief, though Breimeister opposed mistrial unless the following occurred: (1) that the government would agree not to retry him; (2) that the court made a finding that it was forced to order a mistrial because of the government’s misconduct and not at his request; or (3) that the Court made a finding that Government agents intentionally omitted favorable defense evidence from its investigatory reports. He argued that absent one of these occurring, he would be prejudiced because a mistrial would deprive him of moving for a judgment of acquittal or having the jury render a verdict in this trial, which would guarantee the government a “second bite at the apple.”

The district court did not take any of these routes, instead declaring a mistrial, while no party objected at that time. Breimeister moved to dismiss his indictment and bar retrial under the Double Jeopardy Clause due to government misconduct. The district court denied the motion, and this appeal followed.

The Court considered first whether Breimeister had consented to a mistrial, which would forfeit his Double Jeopardy-based claim. The Court found that Breimeister would not need to have objected before the district court after its ruling (which he did not do) if the court’s ultimate decision “clearly fell” within the scope of his original objection. The Court found he could not make this showing. Breimeister stated he would consent to a mistrial under certain conditions, but this motion did not put the district court on notice that the mistrial was declared failed to satisfy his conditions. As he did not object to it when announced, it was unclear if he maintained an objection to the district court’s mistrial when the Court made its ruling.

The Court noted there is a narrow objection to this rule, where the evidence shows the government goaded the defendant into consenting to a mistrial. There was no evidence this occurred, as the district court found the government’s discovery oversights were not malicious or intentionally fraudulent.

And, even if Breimeister had clearly objected, the Court found the district court’s mistrial decision on the basis of “manifest necessity” was not an abuse of discretion. The manifest necessity here was the late disclosure of evidence during a long trial along with its finding that no curative measure or jury instruction would ensure a fair verdict. As a result, the Court affirmed and found no Double Jeopardy Clause violation would result from Breimeister’s retrial.

United States v. Hall, No. 24-10515, 134 F.4th 782 (5th Cir. Apr. 15, 2025)

Issues: Healthcare Fraud, Anti-Kickback Statute, Safe-Harbor Provision, Compounding Pharmacy, Jury Instructions, Restitution.

Chief Judge Elrod, Judge Jones, Judge Stewart) (from N.D. Texas).

Defendant Richard Hall was convicted of healthcare fraud stemming from his pharmacy, for which he and others would pay illegal kickbacks, launder the proceeds, and defraud federal healthcare programs. After being convicted at trial, Hall raised four issues on appeal: (1) the district court erred by instructing the jury that Hall had the burden to demonstrate he fell under the Anti-Kickback Statute (“AKS”) safe-harbor provision; (2) the district court erred in defining “employee” under the same provision; (3) the district court erred by refusing to include Hall’s proposed jury instruction concerning kickback recipients; and (4) the district court should not have imposed restitution. The Fifth Circuit affirmed on all grounds.

Hall was indicted for running a pharmacy where they engaged marketers to promote its compounded drugs. Hall and others established two businesses, one of which was ostensibly meant to cover private insurance claims, where paying marketers does not run afoul of the AKS, and one for federally reimbursed programs like Medicare, where marketers were not supposed to receive commission-based pay. In doing so, Hall and his partners claimed they converted these marketers to W-2 employees, though they continued inducing physicians through a variety of inducements to write prescriptions for both federally and privately paid programs. Hall was convicted for charges related to the AKS and for being part of a money-laundering conspiracy, ordered to pay over $59 million in restitution, and his appeal followed.

The Court set out the elements of the AKS, which prohibits paying kickbacks or bribes for the referral of a person for the furnishing of services for which federal healthcare funds are used, but noted the “safe-harbor provision” to the AKS does not criminalize payments an employer makes to a bona fide employee.

It then addressed Hall’s argument that the jury instruction should have required the government to disprove a safe harbor existed, rather than place the burden of persuasion on the defendant as the district court did here. The Court distinguished between offense elements and affirmative defenses, and it noted that the Supreme Court has long held that when a criminal statute presents exceptions separately from the elements of the offense, the government has no duty to disprove that exception. Instead, the burden is on the defendant to demonstrate the exception applies. As a result, because the safe-harbor provision is an exception to the offense, the Court joined other circuits and held the district court correctly instructed the jury that the defendant had to demonstrate by a preponderance of the evidence that the safe-harbor provision applied to him.

The Court next considered Hall’s claim that it should have used his jury instruction on the definition of “employee” for safe-harbor purposes. The district court’s instruction indicated that an employee is someone whom the employer has the ability to control or direct and is subject to the will and control of the employer. Hall asked the district court to instruct the jury that the “right to control” a purported employee was dispositive. The Fifth Circuit disagreed, citing an ERISA case before the Supreme Court, Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318 (1992), where it held that the right to control was just one of many factors determining whether someone is an employee. As a result, because the district court tracked closely the Fifth Circuit’s pattern jury instruction on this statute and followed Darden, the Court found the district court’s decision to reject Hall’s request was appropriate.

Hall next argued the district court should have instructed the jury that they needed to decide whether the recipient of the kickback was in a position to make referrals or purchases of healthcare goods or services or whether they unduly influenced or acted on behalf of a person in such a position. The Court disagreed, noting that the district court’s jury instructions closely followed the statute and Pattern Jury Instructions by telling the jury that it had to decide whether the payments were made to “to induce” referrals.

Finally, Hall claimed the district court erred by imposing restitution because it relied on “relevant conduct” rather than his counts of conviction, the basis for restitution was unclear, and if it was related to his AKS convictions, his liability should be limited to what he received personally—only just over $70,000. The Court cited the Mandatory Victims Restitution Act (“MVRA”), which mandates restitution for victims of a crime and holds members of a conspiracy jointly and severally liable for foreseeable losses within the scope of the conspiracy. The Court found Hall and others engaged in a money-laundering conspiracy, and the trial evidence showed the proceeds of the AKS scheme funded his lavish spending and was the proximate cause of the loss to the government. As a result, it affirmed the restitution judgment.

Securities and Exchange Commission v. Barton, No. 23-11237, 135 F.4th 206 (5th Cir. Apr. 17, 2025)

Issues: Securities Fraud, Receivership, Preliminary Injunction, Request for Judicial Reassignment.

Judge Higginbotham, Judge Willet) (from N.D. Texas).

Here, the Fifth Circuit, through a two-Judge quorum, considered in this interlocutory appeal challenges to the imposition of a receivership and an injunction freezing the defendant Timothy Barton’s assets, as well as a request for reassignment of the case to a new judge on remand.

The Securities and Exchange Commission (“SEC”) investigated Barton for a scheme involving the “special-purpose entities” that were formed to purchase land for real-estate development. The investors were promised a 10% rate of interest in return for loans to purchase the land, and the loan agreements indicated the funds would be used to purchase and develop a specific property tract. The SEC sued Barton for violating the antifraud provisions of the Securities and Exchange Acts, alleging he used these funds instead to fund his “lavish lifestyle” and on developments outside those contained in the specific loan agreement.

After the SEC sued him, Barton continued spending, using investor funds to pay for his lifestyle, personal expenses, and the purchase of a private plane.

The SEC then sought a receivership over Barton’s companies to stop the spending, and the district court imposed a receiver. Barton appealed that order, and the Fifth Circuit vacated the order in 2023, finding the district court did not apply the correct legal test. On remand, the district court reimposed a receivership, this time applying the standard established in Netsphere Inc. v. Baron, 703 F.3d 296 (5th Cir. 2012). Barton appealed again, challenging the district court’s jurisdiction to appoint the receiver, the appointment of the receiver and its scope, the administration of the receivership, and the preliminary injunction. He also asked the Court to assign the case to another district court judge on remand.

Barton first claimed the district court lacked jurisdiction over the case, and the SEC lacked authority to bring the case, because the court did not determine if the loans qualified as “securities.” The Court noted that, despite not explicitly making that finding, by imposing a receiver and granting an injunction, its subject-matter jurisdiction finding was implicit, while it stated clearly in another order that it had subject matter-jurisdiction after the SEC had argued in the corresponding motion that the loans were securities. The Court further noted that “securities” were defined to include “investment contracts,” which consist of the investment of money in a common enterprise, with an expectation of profits generated solely from the efforts of others. All elements were present here; the loan agreements consisted of securities.

As for the imposition of the receivership, the Court similarly found the district court did not abuse its discretion. It listed the Netscape factors that drive the analysis of the propriety of a receivership: “1) a clear necessity to protect the defrauded investors’ interest in property, 2) legal and less drastic equitable remedies are inadequate, and 3) the benefits of receivership outweigh the burdens on the affected parties.” Here, the Court noted that the value of the assets would decline absent a receivership, as demonstrated by Barton’s post-filing spending, and that they needed to be well managed, as there were operating commercial and residential buildings under Barton’s control. It also protects those interests from third parties, because the assets were subject to a number of liens and lawsuits that would diminish their value further. Less immediate remedies—like Barton remaining involved in the property’s management—would be inadequate because this was the only remedy that would keep Barton from the property and, unlike a monitorship, could stay pending litigation involving the property. Its benefits outweighed the burdens because both creditors and Barton could otherwise dissipate assets, which would limit investor recovery.

The Court also found the receivership’s scope was appropriate and that the district court did not include property outside the scope of the litigation. The Court interpreted Barton’s many complaints about the scope as including three arguments: (1) the court included entities that did not receive or benefit enough from lender funds; (2) it failed to require proper asset-tracing evidence; and (3) it did not exercise discretion. The Court first rejected the first argument because there is nothing in Netscape or otherwise that requires a court imposing a receivership to engage in a proportionality limitation. The Fifth Circuit also found the district court was not required to demand expert testimony in tracing funds, and it also noted that the evidence put forth through an SEC accountant showed lender funds that flowed to entities covered by the receivership. Finally, the Court held the district court did not abuse its discretion generally by including only 54 of the 82 properties the SEC sought for the receivership and correctly applied Fifth Circuit precedent in doing so.

Barton next claimed several errors in the district court’s administration of the receivership, but the Court found it had jurisdiction at the interlocutory stage to consider only whether approving the sale of property was appropriate. As for the sales, the Court held they were appropriate because the district court, prior to approving the sales, considered whether they were in the best interests of the receivership, based on market conditions and relevant statutory factors.

The Court also approved the imposition of the preliminary injunction, which froze the assets not subject to the receivership. The Court found the SEC established a substantial likelihood of success on the merits because it showed that the defendants obtained money from investors by making false statements about the use of the investments, among other falsehoods. Irreparable harm would result absent an injunction because the assets would be dissipated, which would prevent recovery for the investors. The Court rejected the claim that the SEC should have been required to show precisely which entities subject to the injunction benefitted from investor funds, because the tracing had not been fully completed at this early stage of the case and this merely froze the funds. The concern for dissipated assets, discussed above, also led the Court to find there was a risk of irreparable harm, and it relied on precedent in finding that protecting the investors and upholding securities laws is in the public interest.

The Court finally rejected Barton’s request for reassignment to a different district court on remand. It found Judge Starr had considered the Fifth Circuit’s opinion on remand and followed a “thorough analysis” on why the receivership was appropriate under that test. There also was no appearance of Judge Starr prejudging the case, who referred to “defrauded investors,” because he had to make such a finding in ruling on the preliminary injunction request. The Court then noted that reassignment would risk delay and waste because there was already a voluminous record before it, even before Barton had filed an answer in the case.

United States v. Lucas, No. 23-20602, 134 F.4th 810 (5th Cir. Apr. 18, 2025)

Issues: Social Security Fraud, Federal Programs Fraud, Relevant Conduct, Restitution. 

Judge Richman, Judge Willett, Judge Douglas) (from S.D. Texas).

William Dexter Lucas pled guilty to engaging in a bank and wire fraud conspiracy for his involvement in schemes to obtain small-business loans from the government and vehicle loans from private institutions. The district court-imposed restitution for those schemes and related to later-discovered fraud involving Social Security Administration (“SSA”) benefits and, despite his appellate waiver, Lucas challenged restitution awards related to the vehicle loans and the SSA.

Lucas’s fraudulent conduct began after he became involved with Jesus Survives Ministries (“JSM”), a non-profit entity he controlled with family members. Between 2017 and 2020, Lucas and family members used JSM as a front to submit false information on car loan applications and to fraudulently obtain loans from several federal government agencies.

In a factual resume, Lucas admitted to this conduct, signed a plea agreement that waived his right to appeal issues related to restitution, agreed “to pay full restitution to the victim regardless of the count of conviction,” admitted “that as a result of his criminal conduct, the victim incurred a monetary loss of at least $50,000,” and assented that “the Court will determine the amount of restitution to fully compensate the victim.”

Lucas’s Presentence Report included, in addition to discussion of the schemes to which he pled guilty, fraud against the SSA that occurred after the charged schemes concluded and was discovered in early 2023. There was no reference to SSA fraud in the indictment or his plea agreement.

The district court imposed a total of just over $410,000 in restitution related to the schemes described above. Lucas argued the restitution related to the vehicle loans was inappropriate because the named victims—here, car dealerships—did not finance the vehicles, and the financial institutions that did were not included as victim recipients of restitution. He also claimed he returned all but one vehicle, so the fair market value of those vehicles should have been deducted from the restitution balance. Next, Lucas claimed the district court should not have imposed restitution related to the SSA fraud because it was not part of the schemes to which he admitted and pled guilty. The court reduced the restitution figure related to the value of the returned cars, but it still found Lucas owed restitution for the SSA fraud as it was similar to the other government-fraud schemes and imposed approximately $286,000 in restitution.

On appeal, the government attempted to enforce the appellate waiver, and the Court noted that a defendant could challenge a restitution award in situations where the award exceeded the statutory maximum under the MVRA. Thus, a defendant can challenge whether a district court has authority to impose restitution, but it cannot challenge the calculation (with an appellate waiver) if the court had authority to impose restitution.

Thus, for the SSA-related restitution, Lucas’s appellate waiver did not bar that portion of his appeal, because the SSA was not part of the fraud schemes to which he pled guilty. A victim can receive restitution where the defendant’s scheme to which he pled guilty proximately caused the harm, but not where the proximate cause of the harm is not included in the factual resume setting forth the basis for the damages. Here, the SSA fraud was not part of the conspiracy to which Lucas pled guilty—it was not related to JSM, involved only Lucas, and dealt with SSA and not financial loans. Thus, the Court found the district court erred by including this restitution in his overall award and vacated this portion of his judgment.

As for the vehicle-loan restitution, the Court rejected Lucas’s claim that restitution was inappropriate because the victim was misstated in the judgment, as that could be fixed under Rule 36 and the amount would not change. As for the amount, the Court found the appellate waiver barred that challenge because defendants are not, as noted above, permitted to argue against this with an applicable appellate waiver.

United States v. Jones, No. 24-10117, 134 F.4th 831 (5th Cir. Apr. 21, 2025)

Issues: Collateral Review, Habeas Petition, Plea Agreement Appellate Waivers.

Judge Dennis, Judge Richman, Judge Ho) (from N.D. Texas).

Cedric Ray Jones was convicted pursuant to a plea agreement, which included an appellate waiver, after pleading guilty to several charges, including conspiracy to commit Hobbs Act robbery (18 U.S.C. § 1951(a)) and using and brandishing a firearm during a crime of violence (18 U.S.C. § 924(c)). The predicate for the Section 924(c) charge was the conspiracy to commit Hobbs Act robbery, which, at the time, qualified as a “crime of violence” under the residual clause of Section 924(c). As part of his plea agreement, Jones broadly waived his rights to appeal or collaterally attack his convictions and sentences, with limited exceptions.

After the Supreme Court’s decision in United States v. Davis, which held the residual clause of Section 924(c) unconstitutionally vague, Jones sought to vacate his Section 924(c) conviction via a 28 U.S.C. § 2255 motion. The district court denied relief, finding the appellate waiver enforceable, and the Fifth Circuit affirmed.

Scope and Enforceability of the Collateral Review Waiver

Jones argued that the waiver in his plea agreement was too broad to encompass a challenge to a conviction for conduct that was not criminalized, especially in light of Davis. He contended that such a fundamental right required more specific appellate-waiver language. The Fifth Circuit rejected this argument, holding that it has consistently found that broad appeal-waiver language is enforceable even when they preclude challenges to illegal or unconstitutional sentences.

Knowing and Voluntary Nature of the Waiver

Jones argued that he could not have knowingly waived a right that did not exist at the time of his plea. The Court rejected this, relying on United States v. Barnes, 953 F.3d 383 (5th Cir. 2020), in finding that a waiver need only be knowing, not all-knowing, and that defendants assume the risk of future legal changes when entering plea agreements. The Court held that ignorance of future rights is not a basis to avoid waiver language in a plea agreement.

Exceptions to the Waiver: Statutory Maximum and Illegal Sentences

Jones next asserted that his case fell within recognized exceptions to waiver enforcement, specifically that his sentence exceeded the statutory maximum (which, post-Davis, would be zero for the Section 924(c) count) and that neither party intended for the plea agreement to bar challenges to illegal sentences. The Fifth Circuit narrowly construed the statutory maximum exception, holding it applies only if the sentence exceeded the statutory maximum at the time of sentencing (and, thus, challengeable on direct appeal only), not as later determined by subsequent legal developments. The Court also declined to recognize a broader exception for cases where an appellate waiver bars review, as Jones requested, for all illegal sentences or convictions, limiting exceptions to ineffective assistance of counsel and sentences exceeding the statutory maximum as understood at sentencing.

Miscarriage of Justice Exception

Jones urged the Court to adopt a miscarriage-of-justice exception to collateral review of appellate waivers, as recognized in other circuits, which would allow relief in cases of egregious wrongs. The Fifth Circuit declined to do so, noting that such an exception would undermine the purpose of waivers and that Jones did not provide a workable limiting principle.

Dissenting Opinion

In dissent, Judge Dennis argued that the Fifth Circuit’s earlier decision in United States v. White, 258 F.3d 374 (5th Cir 2001), should control, where the Court held that a general waiver does not bar challenges where the indictment fails to charge a valid offense. Judge Dennis asserted the majority failed to follow its precedent and to address the fundamental unfairness of upholding a conviction for conduct that is not criminal.

United States v. Muhammad and Muhammad, No. 24-10113, 134 F.4th 861 (5th Cir. Apr. 21, 2025)

Issues: Plea Agreement Scope, Sex Trafficking, Drug Trafficking.

Judge Jones, Judge Oldham, Judge Hendrix [N.D. Texas District Court Judge, Sitting by Designation]) (From N.D. Texas).

Elijah and Kareem Muhammad, twin brothers, were investigated by the Fort Worth Police Department (FWPD) for sex trafficking beginning in 2018. In parallel, a separate narcotics investigation by FWPD and the Drug Enforcement Administration (DEA) began in early 2023, focusing on fentanyl trafficking at a hotel in Fort Worth, Texas. The brothers were arrested in 2023: Elijah for fentanyl possession and Kareem for unlawful possession of ammunition by a felon. Both pled guilty to these charges in the Northern District of Texas and entered into plea agreements in which the government promised not to bring “any additional charges against the defendant based upon the conduct underlying and related to the defendant’s plea of guilty.”

Subsequently, the government charged both brothers with sex trafficking in a separate Northern District of Texas case, based on conduct spanning from 2011 and involving multiple victims and locations across three states, including Texas. The brothers moved to dismiss the sex trafficking charges, arguing that the government breached their plea agreements. The district court denied their motions and sentenced them for the sex trafficking offenses, and the brothers appealed.

The central issue was whether the government’s prosecution for sex trafficking breached the plea agreements, which barred additional charges “based upon the conduct underlying and related to the defendant’s plea of guilty.” The Fifth Circuit applied general contract law principles to interpret the plea agreements, and it emphasized that when a plea agreement is unambiguous, interpretation is confined to its four corners.

The Fifth Circuit affirmed the district court’s factual findings that the sex trafficking conduct was temporally, geographically, and statutorily distinct from the drug and ammunition offenses. The sex trafficking conduct began in 2011, involved multiple victims (including minors), and spanned several states. In contrast, the drug and ammunition offenses were confined to early 2023 and a single location in Tarrant County, Texas. The Court noted that the plea agreements only covered the conduct underlying the specific drug and ammunition charges, not the broader sex trafficking activities. Though the defendants argued the investigations overlapped, it was the conduct underlying the guilty pleas that controlled the analysis.

The Court considered whether the government’s conduct was consistent with the defendants’ reasonable understanding of the plea agreements. The record showed that neither the presentence investigation reports nor the sentencing in the drug and ammunition cases referenced the sex trafficking conduct. The brothers themselves acknowledged that the sex trafficking charges were expected to be brought in a different district, indicating no genuine misunderstanding of the agreements’ scope.

Thus, the Court held that the government did not breach the plea agreements by prosecuting the brothers for sex trafficking, as those charges were not “based upon the conduct underlying and related to” the drug and ammunition pleas.

United States v. Age, Jr., Guillory, Age, III, and Wilson, No. 22-30656, 136 F.4th 193 (5th Cir. Apr. 25, 2025)

Issues: Murder for Hire, Intrinsic Evidence, Rule 404(b), Cell-Site Location Information, United States v. Carpenter, Good-Faith Exception to Warrantless Search, Severance of Trials, Jury Pool Challenge, Forfeiture by Wrongdoing Exception to Hearsay Rule, Confrontation Clause, Jury Selection and Service Act. 

Judge Higginbotham, Judge Stewart, Judge Haynes) (from E.D. Louisiana).

The Fifth Circuit affirmed the convictions and life sentences of Louis Age, Jr., Louis Age, III, Stanton Guillory, and Ronald Wilson, Jr., for their roles in the murder-for-hire of Milton Womack, a federal witness in a healthcare fraud case. The Court addressed ten principal issues, including sufficiency of the evidence, evidentiary rulings, Fourth Amendment challenges, the forfeiture-by-wrongdoing doctrine, attorney-client privilege, jailhouse-informant testimony, severance, jury instructions, and challenges to the jury selection process.

The Court affirmed on all fronts.

Factual Background

The case’s origins stem from a healthcare fraud prosecution in the Middle District of Louisiana. In August 2011, a federal grand jury indicted Louis Age, Jr. (“Age Jr.”), his daughter Ayanna Age, Milton Womack, and others for healthcare fraud offenses. Age Jr. owned South Louisiana Home Healthcare Agency, with Ayanna helping to run the business. Womack was a recruiter who received illegal kickbacks, and Age III, though not an employee, was on the payroll.  In a separate criminal venture, Womack and Age III burned down a New Orleans school owned by Age Jr. as part of an insurance fraud scheme.

As Womack became a potential government witness, Age Jr. grew concerned about the threat he posed. Womack became uncomfortable with his representation, paid for by Age Jr., and sought new counsel, eventually agreeing to cooperate with the government.

Upon learning of Womack’s intent to plead and testify, Age Jr., in concert with his son Age III and others, conspired to have Womack killed. Age III and Wilson, a friend, sought out members of the Young Mafia Fellaz (“YMF”) gang, including Stanton Guillory, to carry out the murder-for-hire. Guillory, with the assistance of other YMF members, ultimately shot and killed Womack in July 2012.

Following Womack’s murder, the government’s investigation expanded, leading to a 2017 indictment in the Eastern District of Louisiana charging Age Jr., Age III, Guillory, and Wilson with multiple counts, including murder-for-hire, witness tampering, obstruction of justice, and related offenses. After a lengthy trial in 2022, all four were convicted and sentenced to life imprisonment.

Sufficiency of the Evidence

The Court initially addressed multiple defendants’ challenges to the sufficiency of the evidence, and it found the evidence sufficient as to each defendant.

A. Murder-for-Hire and Conspiracy

The evidence supporting the murder-for-hire and conspiracy convictions was substantial and multifaceted. Testimony from co-conspirators and YMF members established that Age III and Guillory negotiated the murder of Womack, coordinated logistics, and that Guillory carried out the killing using a stolen firearm and a carjacked vehicle. The government presented evidence that Age III and Wilson showed Guillory and other YMF members where Womack was staying, provided a description of Womack, and paid Guillory for the murder. Recorded jail calls corroborated the payment arrangement, with YMF member Buddy Lewis referencing the debt owed by Age III to Guillory for the killing.

B. Witness Tampering and Retaliation

The government presented direct and circumstantial evidence that Age III and Guillory conspired to and did kill Womack to prevent his testimony in both the healthcare fraud and arson cases. Ayanna Age testified that Age III assisted Womack with the arson and that Age Jr. was concerned about Womack’s knowledge of both the arson and the healthcare fraud. After learning of Womack’s decision to plead, Age Jr. and his co-conspirators decided to kill Womack. Testimony from YMF members Raheem Jackson and Lewis established that Guillory knew Womack was a federal witness and that the murder was intended to prevent his testimony. The Court found the evidence sufficient to support convictions for both conspiracy and substantive witness tampering and retaliation.

C. Additional Counts: Obstruction, False Statements, and Tampering with Ayanna

The Court also upheld convictions for conspiracy to tamper with Ayanna, based on evidence of threats, intimidation, and efforts to coerce her into silence or recantation. Ayanna testified that after she pled guilty and began cooperating with the government, Age Jr. forced her and her daughters out of the family home, sued her to reclaim rental properties, and attempted to initiate criminal charges against her. Age III told Ayanna she was “dead” to the family and delivered documents related to the property dispute. The Court found that these actions, in context, could be viewed as threats intended to influence Ayanna’s cooperation.

Age III’s conviction for making false statements to the FBI was supported by evidence that he lied about his phone number, his grandfather’s name, and other material facts during the investigation. The Court found that these statements were material because they had the capacity to influence the investigation.

D. Credibility of Witnesses

The Court rejected arguments that the government’s case relied on uncorroborated or incredible testimony. The Court emphasized that a guilty verdict may be sustained on the uncorroborated testimony of a co-conspirator unless the testimony is incredible or insubstantial on its face, which was not the case here.

Evidentiary Rulings

A. Intrinsic and Extrinsic Evidence of Other Crimes

The Court addressed the admissibility of evidence, under either Rule 404(b) or as being intrinsic to the charged offenses, regarding other crimes committed by Guillory and the YMF, including prior murders, robberies, and gang violence. The Court held that much of this evidence was intrinsic to the charged offenses, as it provided necessary context for the murder-for-hire conspiracy and explained why Guillory was selected as the hitman. For example, evidence of Guillory’s participation in prior murders and violent acts established his reputation and capability as a hitman, making it logical that Age III and Wilson would approach him for the murder of Womack. Even if some evidence was extrinsic, any error in its admission was deemed harmless given the overwhelming other evidence of guilt.

B. Evidence of Fraud Schemes

Evidence of the Age family’s prior fraudulent schemes—including the arson-for-insurance fraud and the underlying healthcare fraud—was also admitted as intrinsic to the charged conspiracies. The Court similarly found this evidence necessary to establish motive and context for the efforts to silence Womack and Ayanna. As the fraudulent schemes were the very subject of the federal investigation and prosecution, and the threat posed by Womack and Ayanna as potential witnesses was directly tied to their knowledge of these crimes, the Court also found the district court did not err in admitting evidence related to it.

C. Admission of Phone Records

The Court upheld the admission of phone records under Federal Rule of Evidence 902(11), finding that the government properly authenticated the records and that their admission did not violate the Confrontation Clause. They were business records created in the ordinary course of business, not for the purpose of litigation, and were accompanied by proper certifications from records custodians. The Court also rejected arguments that additional evidence was required to authenticate the records, holding that valid Rule 902(11) certificates were sufficient.

D. Remaining Evidentiary Issues

The Court addressed additional challenges to the admission of evidence related to staged automobile collisions, Wilson’s drug dealing, and other acts. It found that evidence of staged accidents was intrinsic, as it explained the relationship between Age III, Wilson, and the YMF gang. Evidence of Wilson’s drug dealing was deemed harmless, as the remaining evidence was sufficient to convict him.

Fourth Amendment Challenge: Cell Site Location Information (CSLI)

Defendants challenged the admission of historical CSLI obtained without a warrant, arguing that it violated the Fourth Amendment in light of Carpenter v. United States, 585 U.S. 296 (2018). The government had obtained the CSLI under the then-existing provisions of the Stored Communications Act, prior to the Supreme Court’s decision in Carpenter, in which the Supreme Court held that the government generally must obtain a warrant to access historical CSLI.

A. Good-Faith Exception

The Court held that the good-faith exception to the exclusionary rule applied, as the government relied on then-binding Fifth Circuit precedent and statutory authority, pre-Carpenter. At the time the government obtained the CSLI, there was no binding precedent declaring the statute unconstitutional, and the Fifth Circuit had upheld the constitutionality of the Stored Communications Act’s provisions. It further emphasized that reliance on a statute is objectively reasonable unless the statute is clearly unconstitutional, which was not the case here.

B. Burden of Proof and Collateral Estoppel

The Court rejected arguments that the government bore the burden of proving good faith and that collateral estoppel applied based on adverse rulings in other districts. The Court also rejected arguments that the government acted in bad faith by failing to disclose adverse rulings in its applications for CSLI, as the decisions in other districts did not constitute controlling authority.

Forfeiture by Wrongdoing and Admission of Womack’s Statements

At trial, the government moved to admit Womack’s out-of-court statements under the forfeiture-by-wrongdoing exception to the hearsay rule and the Confrontation Clause, arguing that the defendants procured his unavailability by killing him. The district court conducted an evidentiary hearing and found that the government had established, by both a preponderance of the evidence and clear and convincing evidence, that the defendants intended to and did procure Womack’s unavailability.

The Fifth Circuit affirmed the district court’s application of the preponderance-of-the-evidence standard, noting that federal courts generally apply this standard to the forfeiture-by-wrongdoing doctrine. The Court found that the evidence overwhelmingly established that the defendants intended to prevent Womack from testifying and that their actions resulted in his unavailability. The Court upheld the district court’s ruling that all of Womack’s statements on any topic could be introduced, subject to Rule 403 and 608 objections.

Attorney-Client Privilege and Standing

Defendants challenged the admission of testimony from Michael Fiser, Womack’s attorney, regarding communications with Womack. The Court held that the attorney-client privilege survives death but is personal to the client and cannot be asserted by third parties lacking a close relationship. The privilege is intended to protect the client’s interests, not those of adverse parties.

The Court also found that the defendants lacked the requisite close relationship to Womack to assert his privilege, as their interests were directly averse to his. Womack was cooperating with the government and intended to testify against the defendants. The Court emphasized that third-party standing requires a close relationship and a hindrance to the third party’s ability to assert the right, neither of which was present here. The Court also noted that the privilege could not be used to suppress testimony that Womack intended to provide against the defendants.

Jailhouse Informant Testimony and Sixth Amendment Issues

A. Massiah Challenge

Defendants argued that Michael Crawford, a jailhouse informant, was a government agent who deliberately elicited incriminating statements from Wilson in violation of Massiah v. United States, 377 U.S. 201 (1964). The Court found that Crawford was not acting as a government agent at the time he obtained the information, as he was not promised or led to expect a benefit and was not acting under government direction. Crawford’s relationship with Wilson predated any contact with the government, and the information was obtained in the course of normal conversation between friends.

B. Confrontation Clause and Hearsay

The Court held that Crawford’s testimony regarding Wilson’s statements was not testimonial under the Confrontation Clause, as the statements were made in the context of a personal relationship, not for the purpose of prosecution. The Court applied the primary purpose test, finding that the statements were not made with the primary purpose of establishing or proving past events for use in a criminal prosecution. Hearsay objections to Crawford’s testimony were reviewed for plain error due to lack of timely objection, and the Court found no clear or obvious error in admitting the statements as statements against penal interest, corroborated by other evidence.

C. Cross-Examination Limitations

The Court rejected challenges to the district court’s limitations on cross-examination of Crawford regarding prior convictions and other matters. The Court found that the jury had sufficient information to assess Crawford’s credibility and that the restrictions did not violate the Sixth Amendment. The Court noted that the right to cross-examine is satisfied when the jury has enough information to assess the witness’s bias and motive, and that the district court has discretion to limit cross-examination to avoid harassment, prejudice, confusion, or cumulative evidence.

D. Other Issues Regarding Informant Testimony

The Court addressed additional challenges to the exclusion of recordings of jailhouse calls and the limitation of cross-examination regarding statements made by other inmates. The Court found no abuse of discretion in the district court’s rulings, noting that the transcripts of the calls were sufficient for impeachment and that the exclusion of certain lines of questioning was within the court’s discretion.

Severance of Trials

Age III moved to sever his trial from Age Jr.’s, arguing that admission of his father’s statements would violate his Confrontation Clause rights. The Court applied the “exceedingly deferential” abuse of discretion standard and found no compelling prejudice warranting severance, especially given the jury’s ability to compartmentalize the evidence and the acquittal of Age III on one count.

The Court found that Age III failed to show specific, compelling prejudice that could not be addressed by jury instructions. The jury was instructed to consider the evidence separately as to each defendant, and the acquittal of Age III on one count demonstrated the jury’s ability to follow instructions and compartmentalize the evidence.

Jury Instructions

Age Jr. challenged the jury instructions for the conspiracy to retaliate against Ayanna charge, arguing that a but-for causation instruction was required. Specifically, Age Jr. requested that the district court instruct the jury that the challenged action was taken with the intent of retaliating if it would not have been taken but for the intention to retaliate.

The Court held that the instructions given were a correct statement of the law and that the government need only prove an intent to retaliate, not but-for causation. The Court relied on its precedent holding that the natural, probable consequences of an act may evidence the requisite intent and that the only intent required under the statute is an intent to retaliate.

The Court found that the jury instructions, taken as a whole, were a correct statement of the law and clearly instructed the jurors as to the applicable legal principles. The Court also noted that the trial court has substantial latitude in describing the law to the jury and that the failure to give a requested instruction is reversible only if it seriously impairs the defendant’s ability to present a defense.

Jury Selection and Fair Cross-Section Claims

A. Jury Selection Process in EDLA

Defendants challenged the jury selection process in the Eastern District of Louisiana under the Jury Selection and Service Act (JSSA), the Sixth Amendment’s fair cross-section guarantee, and the Fifth Amendment’s Due Process Clause. They alleged underrepresentation of African Americans and persons of lower economic status due to reliance on voter registration lists and differential response rates to juror qualification forms.

The Court described the jury selection process in detail, noting that the Clerk’s Office used voter registration lists as the sole source for the master jury wheel, supplemented by lists of licensed drivers and state identification cards in later years. The process involved random selection of names, mailing of juror qualification forms, and review of returned forms for exemptions, excuses, and disqualifications.

B. Duren v. Missouri Analysis

The Court applied the three-prong test under Duren v. Missouri, 439 U.S. 357, 364 (1979): (1) whether the group is distinctive, (2) whether its representation is fair and reasonable, and (3) whether underrepresentation is due to systematic exclusion.

• Distinctive Group: The Court found that African Americans are a distinctive group for Sixth Amendment purposes. However, the claim regarding persons of lower economic status failed for lack of a clear definition and supporting data.
• Fair and Reasonable Representation: The Court found that the absolute disparity in representation of African Americans (11.84%) did not meet the threshold for a prima facie violation under Fifth Circuit precedent, which generally requires a disparity greater than 10% for over-10% minority groups. The Court noted that the disparity was not statistically significant and that the number used by defendants was likely overstated, as it was based on the population over 18 rather than the jury-eligible population.
• Systematic Exclusion: The Court held that lower response rates to jury summonses by African Americans did not constitute systematic exclusion inherent in the jury selection process, as the underrepresentation resulted from individual choices, not the operation of the system. The Court distinguished this case from Duren, where the system itself provided exemptions that led to underrepresentation.

C. JSSA and Due Process

The Court found no substantial failure to comply with the JSSA and no due process violation in the denial of an evidentiary hearing. The Court noted that defendants were given ample opportunity to present evidence and challenge the process, including access to jury selection records and the ability to submit expert reports. The Court also rejected arguments that the district court erred in denying requests for additional data and for the issuance of subpoenas to non-responding jurors.

D. Denial of Evidentiary Hearing

The Court reviewed the denial of an evidentiary hearing for abuse of discretion and found no error, as the defendants failed to allege sufficient facts that, if proven, would justify relief. The Court emphasized that the information needed to make a prima facie case was provided by the Clerk’s Office and that the district court was not required to grant unfettered access to personal identification information of jurors.

United States v. Jones, No. 24-30236, 136 F.4th 272 (5th Cir. Apr. 29, 2025)

Issues: Manager-Supervisor Enhancement, Sentencing, Zero-Point Offender Reduction.

Chief Judge Elrod, Judge Higginbotham, Judge Southwick (from W.D. Louisiana).

Roy Lee Jones, Jr. was convicted in the Western District of Louisiana for conspiracy to distribute and possess with intent to distribute methamphetamine, in violation of 21 U.S.C. §§ 841(a)(1) and 846. Jones operated as a distribution head for a methamphetamine-trafficking organization, receiving large shipments from a California-based supplier and redistributing them through a network of co-defendants and street-level dealers. After a ten-month investigation, Jones and others were indicted and, following a five-day trial, convicted. The Presentence Report (PSR) calculated Jones’s offense level at 37, including a three-point enhancement under USSG § 3B1.1(b) for his role as a manager or supervisor. He was sentenced to 210 months’ imprisonment; a sentence affirmed on direct appeal.

Amendments 821 and 825: The Zero-Point Offender Reduction

On November 1, 2023, Amendment 821 to the Sentencing Guidelines introduced Section 4C1.1, providing a two-level reduction for certain “zero-point offenders.” Amendment 825 made this change retroactive. The criteria for eligibility under Section 4C1.1(a) are strict, including the requirement that the defendant did not receive an aggravating role adjustment under Section 3B1.1 and was not engaged in a continuing criminal enterprise as defined in 21 U.S.C. § 848.

Jones filed a motion for a sentence reduction under these amendments. The Probation Office initially found him eligible for the reduction, and both the U.S. Attorney’s Office and Jones’s counsel supported the motion. However, the district court denied the motion, finding Jones ineligible due to his aggravating role and engagement in a continuing criminal enterprise.

Interpretation of USSG § 4C1.1(a)(10): Disqualifying Conditions

Central to the appeal was the interpretation of Section 4C1.1(a)(10), which disqualifies defendants who either received an aggravating role adjustment or engaged in a continuing criminal enterprise. The district court initially interpreted the provision to require both conditions for ineligibility, but the Fifth Circuit clarified that either condition alone suffices to disqualify a defendant. This interpretation aligns with the Fifth Circuit’s decision in United States v. Morales, 122 F.4th 590, 594 (5th Cir. 2024), in which the Court held that the two disqualifying conditions are independent and disjunctive.

Judicial Fact-Finding in Sentence Reduction Proceedings

Jones argued that the district court improperly made new factual findings at the sentence-reduction stage, specifically regarding his engagement in a continuing criminal enterprise, which had not been found at the original sentencing or by the jury. The Fifth Circuit rejected this argument, explaining that proceedings under 18 U.S.C. § 3582(c)(2) are not re-sentencings but rather discretionary modifications. The Court emphasized that judicial fact-finding by a preponderance of the evidence is permissible in this context and does not violate the Sixth Amendment or Apprendi principles, as these proceedings do not increase the statutory range of punishment.

Application to Jones: Manager/Supervisor Role and Continuing Criminal Enterprise

The Fifth Circuit found ample evidence supporting the district court’s findings supporting the aggravating-role enhancement. Jones’s role as a manager or supervisor was established by the PSR and trial evidence, including extensive witness testimony and recorded communications. The Court also found that Jones’s conduct met the elements of a continuing criminal enterprise under 21 U.S.C. § 848, as he operated in concert with five or more persons, occupied a managerial position, and obtained substantial resources from the conspiracy. The Court noted that, even though Jones was not charged under Section 848, the sentencing judge could make this finding for purposes of § 4C1.1(a) eligibility.

Thus, the Fifth Circuit affirmed the district court’s denial of Jones’s motion for a sentence reduction.

United States v. Rodriguez and Martinez-Montelongo, Nos. 24-40031 & 24-40047, 136 F.4th 238 (5th Cir. Apr. 29, 2025)

Issues: Sufficiency of the Evidence, Drug-Trafficking, Sentencing, Reasonableness of Sentence.

Judge Smith, Judge Higginson, Judge Douglas (from S.D. Texas).

This case involves the consolidated appeals of Fidel Saldana Rodriguez and Noe De Jesus Martinez-Montelongo, who were convicted for conspiracy to import and importation of methamphetamine. The convictions arose from a November 28, 2022, incident at the Columbia Solidarity Bridge Port of Entry in Laredo, Texas, where the defendants were apprehended while attempting to cross the U.S.-Mexico border in a tractor-trailer containing liquid methamphetamine concealed in the vehicle’s fuel tanks. The Fifth Circuit reviewed challenges to the sufficiency of the evidence supporting Saldana’s convictions and the substantive reasonableness of Martinez-Montelongo’s sentence, ultimately affirming both.

On the evening of November 28, 2022, Martinez-Montelongo (driver) and Saldana (passenger) arrived at the border in a tractor-trailer with an empty refrigerator trailer. Customs and Border Protection (CBP) Officer Vila Cruz found it unusual for two people to be in an empty tractor-trailer and referred the vehicle for inspection, especially since it was flagged in the TECS system for prior suspicious activity. A canine unit alerted to narcotics near the fuel tanks, and further inspection revealed non-standard bolts and barriers inside the tanks. After cutting open the tanks, officers extracted 414.36 kilograms of liquid, which tested as 56% methamphetamine.

Both defendants were arrested. Investigators found that the fuel gauge was inoperative and that the defendants used a stick to measure fuel levels. Interviews revealed inconsistent stories about their trip’s purpose, and text messages between the defendants and a contact named “Alan” (later identified as Umberto Hernandez Gonzalez) suggested coordination for the trip. The truck was linked to Express International Group; a company previously flagged in drug smuggling investigations.

Sufficiency of the Evidence Against Saldana

The central issue in Saldana’s appeal was whether the evidence was sufficient to prove he knowingly participated in the conspiracy and importation of methamphetamine.

The government argued that Saldana’s sufficiency challenge was not preserved because the trial transcript did not reflect a Rule 29 motion for acquittal. However, the Fifth Circuit found that the district court’s minute entry confirmed both defendants made such motions, which were denied, and that the absence in the transcript was likely due to a recording issue. Thus, Saldana’s challenge was reviewed de novo.

The government was required to prove, for conspiracy, the existence of an agreement to import, knowledge of the agreement, and voluntary participation; for importation, that Saldana played a role in bringing a controlled substance into the U.S., knew it was controlled, and knew it would enter the U.S.

Because the drugs were hidden in a secret compartment, the Fifth Circuit required “additional circumstantial evidence that is suspicious in nature or demonstrates guilty knowledge.” The Court considered several factors:

• Nervousness and Demeanor: Saldana was not observed to be nervous; he claimed Martinez-Montelongo was the one who appeared nervous.
• Inconsistent Statements: Saldana gave conflicting accounts of the trip’s purpose, initially stating they were picking up a load in Laredo to return to Mexico, then later saying they would take a load to Kansas and return with cash.
• Communications and Relationship with “Alan”: While Martinez-Montelongo handled most communications with Alan, Saldana was included in WhatsApp messages interpreted by investigators as referencing drug smuggling, though no explicit mention of drugs was made.
• Payment Disparity: Saldana was to be paid $3,500, while Martinez-Montelongo was to receive $6,000. Saldana argued this disparity suggested he was less involved, but the government argued it was still suspicious for an “innocent” passenger to be paid.
• Truck Modifications and Fuel Measurement: The use of a stick to measure fuel, due to a broken gauge, was considered rare and suspicious, especially given the divided fuel tanks designed to conceal contraband.

The Court found that, although the evidence could support an inference that Saldana was an unwitting participant, it was also reasonable for the jury to conclude he had guilty knowledge. The presence of multiple suspicious factors, including inconsistent statements, the method of fuel measurement, and the nature of the communications, was sufficient for a rational trier of fact to find the essential elements of the crimes beyond a reasonable doubt. The Court emphasized that it is the jury’s role to resolve competing inferences and that the evidence need not exclude every hypothesis of innocence.

Reasonableness of Martinez-Montelongo’s Sentence

Martinez-Montelongo challenged the substantive reasonableness of his 235-month sentence, arguing that the district court improperly considered his refusal to admit guilt as a factor in sentencing, in violation of his Fifth Amendment right against self-incrimination.

The district court sentenced Martinez-Montelongo at the low end of the Guidelines range (235–293 months), after he requested a downward variance to the 120-month mandatory minimum. The district court referenced the defendants’ continued insistence on innocence but clarified that it was sentencing them based on the strong evidence of guilt presented at trial, not as punishment for their lack of remorse or refusal to confess.

The Fifth Circuit reviewed whether the district court’s comments and reasoning at sentencing amounted to an abuse of discretion or a violation of the Fifth Amendment. The Court distinguished this case from United States v. Laca, 499 F.2d 922 (5th Cir. 1974), where the Court vacated sentences because the district court explicitly conditioned leniency on the defendants’ repentance. Here, the sentencing transcript showed that the district court acknowledged the defendants’ right to maintain innocence and did not impose a higher sentence due to lack of remorse. The Court also noted that the sentence imposed was at the bottom of the Guidelines range, further supporting the conclusion that the district court was not motivated by improper considerations.

The opinions expressed are those of the authors and do not necessarily reflect the views of the firm, its clients, or any of their respective affiliates. This article is for informational purposes only and does not constitute legal advice. For questions related to these cases, please contact a member of the Investigations & White Collar Defense practice.

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