Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-12-03074/USCOURTS-caDC-12-03074-0/pdf.json

Nature of Suit Code: 510
Nature of Suit: Prisoner Petitions - Vacate Sentence
Cause of Action: 

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued January 9, 2014 Decided August 8, 2014

No. 12-3074

UNITED STATES OF AMERICA,

APPELLEE

v.

JAMES ODELL BAXTER, II,

APPELLANT

Appeal from the United States District Court

for the District of Columbia

(No. 1:03-cr-00516-1)

Cheryl J. Sturm argued the cause and filed the briefs for

appellant. 

Peter S. Smith, Assistant U.S. Attorney, argued the cause

for appellee. With him on the brief were Ronald C. Machen Jr.,

U.S. Attorney, and Elizabeth Trosman and Sherri Berthrong,

Assistant U.S. Attorneys. Suzanne G. Curt, Assistant U.S.

Attorney, entered an appearance.

Before: GARLAND, Chief Judge, SRINIVASAN, Circuit

Judge, and WILLIAMS, Senior Circuit Judge.

Opinion for the Court filed by Chief Judge GARLAND.

USCA Case #12-3074 Document #1506778 Filed: 08/08/2014 Page 1 of 26
2

GARLAND, Chief Judge: James O. Baxter, II was convicted

on multiple counts of defrauding the Washington Teachers

Union. We have previously described the charges against him

as arising from “a seven-year orgy of greed,” during which he

and others “stole millions of dollars” from the union. United

States v. Hemphill, 514 F.3d 1350, 1353 (D.C. Cir. 2008). 

Baxter now appeals the district court’s denial of his motion to

vacate his convictions pursuant to 28 U.S.C. § 2255. Although

we grant Baxter’s motion for a certificate of appealability to

consider two of his three challenges, we conclude that he is not

entitled to relief and therefore affirm the judgment of the district

court.

I

The following description of the facts is taken from the trial

record and from this court’s decision on direct review of

Baxter’s convictions, Hemphill, 514 F.3d at 1353-54, 1361-63.

In 1994, the Washington Teachers Union (WTU) elected

new leadership, including Barbara Bullock as president, Esther

Hankerson as vice president, and James O. Baxter, II as

treasurer. In 1996, Bullock hired Gwendolyn Hemphill as her

executive assistant and WTU office manager. At all relevant

times, Baxter was the WTU’s treasurer. As treasurer, one of his

duties included countersigning checks (also signed by either

Bullock or Hankerson) for the WTU account. Bullock, Baxter,

and Hemphill, with the help of other coconspirators, defrauded

the WTU of millions of dollars between 1995 and 2002. See

Hemphill, 514 F.3d at 1353-54.

The fraud was effectuated in several ways. One involved

WTU American Express cards, issued to Bullock, Hankerson,

and Baxter, which the conspirators used to charge thousands of

dollars in personal expenses. Hemphill, 514 F.3d at 1353-54. 

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Bullock’s spending was particularly extravagant. It totaled more

than $1.2 million and included custom-made clothing,

silverware, crystal, and a piano. J.A. 604, 607-17, 917-19

(Bullock Test.).

1

 Some of the credit card bills were paid directly

with WTU checks signed by Bullock and Baxter. Id. at 612-14,

650. 

In addition, Hemphill wrote and Baxter signed WTU checks

to Bullock’s driver, Leroy Holmes, for amounts far in excess of

Holmes’ salary. Holmes then cashed the checks, giving some

money to Hemphill and depositing other money in Bullock’s

personal account. Hemphill, 514 F.3d at 1354. Similarly,

Hemphill wrote and Baxter signed checks to a shell corporation,

Expressions Unlimited, that Hemphill’s son-in-law, Michael

Martin, and his friend, Errol Alderman, created. See Hemphill,

514 F.3d at 1363; J.A. 1347-49, 1364-68 (Martin Test.). Martin

deposited some of the checks in Expressions Unlimited’s

account and cashed others. Thereafter, he and Alderman wrote

checks to Bullock on Expressions’ account, which they

deposited in her personal account along with the money from the

checks they had cashed. J.A. 1354-55, 1367-70 (Martin Test.). 

Bullock then wrote checks on her personal account to pay some

of the American Express bills. J.A. 668-69 (Bullock Test.). 

Apparently she did so to make it seem that she was paying for

personal expenditures out of her personal account, when in fact

the money Bullock used came from the union.

Baxter personally benefitted from the fraud. He wrote

several checks to himself on the WTU general account, which

he designated as “pension” payments during a period of time

when no other employee was receiving pension payments

1

When asked at trial whether it was fair to say that she liked to

shop, Bullock responded: “No, that’s not fair. I love to shop.” J.A.

601. 

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because there was no money in the WTU pension fund. 

Hemphill, 514 F.3d at 1362-63; J.A. 693-95, 724-28 (Bullock

Test.). He also used union funds and the WTU credit cards to

make personal purchases, including $19,660 for Washington

Wizards basketball tickets for his and his coconspirators’

personal use, and $5,000 in art for his home. Hemphill, 514

F.3d at 1362-63.

The government also presented evidence of Baxter’s

involvement in concealing the crimes. He signed numerous

fraudulent checks to himself, Bullock, Hemphill, Holmes, and

Expressions Unlimited. Id. at 1363. In addition, he signed a

fraudulent LM-2 (an annual financial report made by the WTU

to the Internal Revenue Service) that did not include money paid

to Hemphill or Holmes, even though notes recovered from his

house recorded those payments. Id. at 1362. In Baxter’s files,

the government recovered drafts of fraudulent financial reports

that his coconspirators had faxed to him. Hemphill, 514 F.3d at

1362. One of those drafts contained handwritten notes showing

how to falsely allocate the debits -- arising from the

conspirators’ personal American Express charges -- to other

budget categories. Id. Over half a million dollars in such

charges were reclassified to the “employee benefit expense” and

“travel and meeting expense” categories on those fraudulent

financial documents. See Jury Trial Tr. 5490, United States v.

Baxter, No. 03-CR-516 (D.D.C. Aug. 10, 2005).

By early 2002, the fraud had so depleted the union’s funds

that it could not pay membership fees it owed to its parent

organization, the American Federation of Teachers (AFT). The

coconspirators then devised a scheme to make up the shortfall. 

Hemphill, 514 F.3d at 1354. Under a collective bargaining

agreement that the WTU had reached with the District of

Columbia Public Schools, the WTU’s member teachers were

entitled to a pay raise. As a result, each teacher owed a

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supplemental lump sum dues payment to the WTU. J.A. 773-74

(Bullock Test.). Properly calculated, that dues payment was not

enough to make up the shortfall, so the conspirators simply

changed that amount. Instead of deducting $16.09 in union dues

from each teacher’s paycheck, Baxter proposed deducting

$160.09 and, if discovered, passing it off as a clerical error. 

Hemphill, 514 F.3d at 1354, 1362. Teachers who noticed the

discrepancy alerted the AFT, which then contacted federal

authorities. Hemphill, 514 F.3d at 1354.

After the government was alerted to the situation, the FBI

recovered evidence from Baxter’s home computer that showed

the extent of his involvement in the dues scheme, as well as in

a potential further cover-up. The WTU had sent a letter to the

District of Columbia Office of Pay and Retirement, instructing

the Office to deduct the $160.09 from the teachers’ paychecks. 

An FBI computer specialist found a copy of the letter with the

$160.09 figure in Baxter’s email outbox. That letter was last

printed on April 17, 2002. But the FBI specialist found that the

letter had been saved again on September 23, 2002 -- after the

investigation began -- in Baxter’s “My Documents” file. This

time, the letter used the $16.09 amount. See Jury Trial Tr. 3836-

50, United States v. Baxter, No. 03-CR-516 (D.D.C. July 14,

2005).

A grand jury indicted Baxter, Hemphill, and James A.

Goosby (the WTU’s accountant) on November 20, 2003. 

Bullock, Holmes, Martin, and Alderman all pled guilty and

testified for the government. Baxter was charged in 23 counts,

including conspiracy to commit fraud and other offenses, wire

fraud, mail fraud, making false statements, embezzlement from

a labor union, theft, money laundering, and conspiracy to

commit money laundering. J.A. 219-59. The trial against the

three defendants lasted twelve weeks. The jury acquitted

Goosby, but convicted Baxter and Hemphill on all counts. 

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Hemphill, 514 F.3d at 1354. On June 5, 2006, Baxter was

sentenced to 120 months’ imprisonment. Id. 

Baxter and Hemphill appealed, and on February 8, 2008,

this court affirmed the district court’s judgment as to both

defendants on all counts. Id. at 1353. The Supreme Court

denied Baxter’s petition for certiorari on November 10, 2008,

Baxter v. United States, 555 U.S. 1020 (2008), and denied his

petition for reconsideration on January 12, 2009, Baxter v.

United States, 555 U.S. 1130 (2009).

On January 11, 2010, Baxter filed a motion to vacate his

sentence pursuant to 28 U.S.C. § 2255.2

 The district judge

denied Baxter’s motion for § 2255 relief on August 28, 2012,

based on “the parties’ briefs,” “the entire record,” and the

knowledge the judge acquired from “[h]aving presided over

petitioner’s trial and sentencing.” J.A. 480-81. On November

9, 2012, Baxter applied for a certificate of appealability, which

the judge denied on January 10, 2013. J.A. 485.

Thereafter, Baxter filed a notice of appeal from the denial

of his § 2255 motion and moved for a certificate of appealability

from this court. In challenging his conviction, Baxter raises

three principal claims. First, he argues that the government

2

Section 2255 provides:

A prisoner in custody under sentence of a court established

by Act of Congress claiming the right to be released upon

the ground that the sentence was imposed in violation of the

Constitution or laws of the United States . . . may move the

court which imposed the sentence to vacate, set aside or

correct the sentence.

28 U.S.C. § 2255(a). 

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violated its obligations under Brady v. Maryland, 373 U.S. 83

(1963), when it failed to turn over evidence that Bullock

suffered from bipolar disorder. Second, he argues that his

conviction for conspiracy to commit fraud and other offenses

must be vacated because it was based on an honest-services

fraud theory that is invalid under Skilling v. United States, 561

U.S. 358 (2010). Finally, he argues that his conviction for

money laundering and conspiracy to commit money laundering

is invalid under this court’s decision in United States v.

Adefehinti, 510 F.3d 319 (D.C. Cir. 2007). We consider these

arguments in Parts II, III, and IV below. 

II

Barbara Bullock pled guilty to the fraud and associated

charges that are the centerpiece of this appeal. At her January

2004 public sentencing hearing, she sought leniency on the

ground that she suffered from bipolar disorder, which she

claimed gave rise to her “obsession with shopping.” Sent’g Tr.

21 (Gov’t Supp. App’x 25), United States v. Bullock, No. 03-

CR-435 (D.D.C. Jan. 30, 2004). Baxter’s trial commenced in

May 2005, more than a year later, and Bullock testified against

him. Baxter charges that the government failed to disclose

Bullock’s bipolar disorder prior to trial, and that the failure

violated its responsibilities under Brady v. Maryland. The

government responds that Brady does not require disclosure of

the information concerning Bullock’s disorder because that

information was not material.3

3

The government also argues that the information does not fall

within the Brady rule because the government did not “withhold” or

“suppress” it, since it was part of Bullock’s testimony at her January

2004 public sentencing hearing, and the transcript was filed on the

district court’s public docket in June 2004. Gov’t Br. 14. Because we

conclude that Baxter has failed to show the information was material

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“Unless a . . . judge issues a certificate of appealability, an

appeal may not be taken to the court of appeals from . . . the

final order in a proceeding under section 2255.” 28 U.S.C.

§ 2253(c)(1)(B). When the district judge has denied a

certificate, as the judge did here, the applicant may seek one

from the court of appeals. Fed. R. App. P. 22(b). The

Antiterrorism and Effective Death Penalty Act (AEDPA)

provides that such a certificate may issue “only if the applicant

has made a substantial showing of the denial of a constitutional

right.” 28 U.S.C. § 2253(c)(2); see Slack v. McDaniel, 529 U.S.

473, 483-84 (2000). This means that the prisoner must show,

“at least, that jurists of reason would find it debatable whether

the petition states a valid claim of the denial of a constitutional

right.” Slack, 529 U.S. at 478.

Under Brady, “the State violates a defendant’s right to due

process if it withholds evidence that is favorable to the defense

and material to the defendant’s guilt or punishment.” Smith v.

Cain, 132 S. Ct. 627, 630 (2012). “[E]vidence is ‘material’

within the meaning of Brady when there is a reasonable

probability that, had the evidence been disclosed, the result of

the proceeding would have been different.” Id. (internal

quotation marks omitted). It is the “petitioner’s burden . . . to

establish a reasonable probability of a different result.” 

Strickler v. Greene, 527 U.S. 263, 291 (1999); see United States

v. Johnson, 519 F.3d 478, 488 (D.C. Cir. 2008).

Baxter has not even attempted to show how evidence of

Bullock’s bipolar disorder might have changed the outcome of

his trial. The only thing he says is that he could have used it

“effectively to impeach” her testimony, Baxter Br. 26, and that

“[b]ipolar disorder is material because it casts doubt on the

ability and willingness of Ms. Bullock to tell the truth,” id. at 43. 

under Brady, we do not address this argument.

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But he does not say how he would have used evidence of this

illness to impeach her testimony or why it would have cast doubt

on her ability or willingness to tell the truth. We have no doubt

that medical records can be the “grist for effective crossexamination,” Reply Br. 18, but such a conclusory assertion is

insufficient to establish materiality. Cf. United States v. George,

532 F.3d 933, 937 (D.C. Cir. 2008) (holding that a district court

did not err in barring cross-examination about a witness’ bipolar

disorder because nothing in the defendant’s proffer indicated

that it “would reasonably cast doubt on her ability or willingness

to tell the truth”); id. (“Mental illness is not a generic badge of

incompetence or dishonesty.”). Bullock was extensively crossexamined at trial, particularly on the ground that her desire for

a reduced sentence gave her a motive to inculpate Baxter, and he

does not explain what additional impeachment value her

disorder would have had.

Moreover, even if the evidence could have been used to

successfully impeach Bullock, the probability of a different

outcome depends on the context of all of the evidence offered at

trial. See Smith, 132 S. Ct. at 630. Other than declaring that

Bullock was a “crucial witness,” Baxter Br. 43, Baxter does not

explain why her impeachment would likely have resulted in a

different verdict. To the contrary, the evidence of Baxter’s guilt

was overwhelming, even if Bullock’s testimony had been

compromised. See Hemphill, 514 F.3d at 1362-63. Baxter’s

mere declaration to the contrary is insufficient to meet his

burden.4

 Accordingly, we conclude that Baxter has not stated a

4

Baxter makes the related claim that his trial counsel was

ineffective under Strickland v. Washington, 466 U.S. 668 (1984), for

failing to discover that Bullock suffered from bipolar disorder. 

Because one prong of the Strickland test requires a defendant to show

prejudice from any alleged ineffectiveness of counsel, this claim fails

for the same reason his Brady claim fails. See Strickland, 466 U.S. at

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Brady claim that “jurists of reason” would find debatable, and

we therefore deny his request for a certificate of appealability.5

III

Baxter argues that his conviction on Count 1 was invalid in

light of Skilling v. United States, 561 U.S. 358 (2010). Count 1

charged Baxter and others with conspiracy to commit offenses

against the United States, in violation of 18 U.S.C. § 371. The

count charged the following offenses as among the objects of the

conspiracy: (1) mail and wire fraud to obtain money and

property, in violation of 18 U.S.C. §§ 1341 and 1343; and (2)

mail and wire fraud to deprive the WTU of its intangible right

to the defendants’ honest services, in violation of 18 U.S.C.

§§ 1341, 1343, and 1346.6

 The judge instructed the jury that it

694 (“[T]he appropriate test for prejudice finds its roots in the test for

materiality of exculpatory information not disclosed to the defense by

the prosecution . . . .”); Montgomery v. Bobby, 654 F.3d 668, 679 n.4

(6th Cir. 2011) (“[I]t is well settled that the test for prejudice under

Brady and Strickland is the same.” (internal quotation marks

omitted)). 

5

Baxter also contends that the district court abused its discretion

in failing to grant an evidentiary hearing to develop his Brady claim. 

A “district judge’s decision not to hold an evidentiary hearing before

denying a § 2255 motion is generally respected as a sound exercise of

discretion when the judge denying the § 2255 motion also presided

over the trial in which the petitioner claims to have been prejudiced.” 

United States v. Morrison, 98 F.3d 619, 625 (D.C. Cir. 1996); accord

United States v. Toms, 396 F.3d 427, 437 (D.C. Cir. 2005). We see no

abuse of discretion and no warrant for granting a certificate of

appealability on this issue.

6

As the Supreme Court explained in Skilling: “The mail- and

wire-fraud statutes criminalize the use of the mails or wires in

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could find Baxter guilty if the government proved he conspired

to commit any of the charged object offenses. J.A. 1528.7

 And

the verdict form allowed the jury to return a general verdict on

Count 1, without specifying upon which object it had based the

conspiracy conviction. See J.A. 254.8

 In Skilling, the Supreme Court held that the honest-services

fraud statute, which prohibits a “scheme or artifice to deprive

another of the intangible right of honest services,” 18 U.S.C.

§ 1346, “proscribe[s] bribes and kickbacks -- and nothing

more.” Skilling, 561 U.S. at 410. The government had neither

alleged nor proved that Skilling received bribes or kickbacks. 

Id. at 413. “Because the indictment alleged three objects of the

conspiracy -- honest-services wire fraud, money-or-property

wire fraud, and securities fraud,” the Court held that “Skilling’s

conviction [wa]s flawed.” Id. at 414. As the Court noted,

furtherance of ‘any scheme or artifice to defraud, or for obtaining

money or property by means of false or fraudulent pretenses,

representations, or promises.’ 18 U.S.C. § 1341 (mail fraud); § 1343

(wire fraud). The honest-services statute, § 1346, defines ‘the term

“scheme or artifice to defraud”’ in these provisions to include ‘a

scheme or artifice to deprive another of the intangible right of honest

services.’” 561 U.S. at 369 n.1. 

7

“[T]he government is entitled to prove criminal acts in the

disjunctive, notwithstanding that the indictment charges them in the

conjunctive.” United States v. Coughlin, 610 F.3d 89, 106 (D.C. Cir.

2010) (citing Griffin v. United States, 502 U.S. 46, 56-60 (1991)).

8

Although the parties discuss Count 1 as if it merely charged a

conspiracy to commit fraud (by wire and mail), it also charged as

objects of the conspiracy embezzlement from a labor organization, in

violation of 29 U.S.C. § 501(c), and making false statements in

violation of 18 U.S.C. § 1001. Because the parties do not focus their

arguments on these objects, we do not discuss them.

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“constitutional error occurs when a jury is instructed on

alternative theories of guilt and returns a general verdict that

may rest on a legally invalid theory.” Id. (citing Yates v. United

States, 354 U.S. 298 (1957)). The Court did not vacate

Skilling’s conviction, however, because errors of this “variety

are subject to harmless-error analysis.” Id. Instead, it remanded

the case for the court of appeals to determine whether the error

was harmless. Id. at 414 & n.46.

As in Skilling, it is undisputed that the scheme at issue in

this case involved neither bribes nor kickbacks, and that the

judge did not instruct the jury that honest-services fraud was so

limited. Moreover, like Skilling’s jury, Baxter’s was instructed

on alternative theories of guilt and returned a general verdict on

Count 1 that may have rested on the legally invalid honestservices fraud theory. Accordingly, Baxter maintains that his

conviction on Count 1 constituted constitutional error under

Skilling.

9

 

1. As we noted above, Baxter may not take an appeal on this

issue unless we grant a certificate of appealability, and we may

do so only if “jurists of reason would find it debatable whether

the petition states a valid claim of the denial of a constitutional

9

Baxter contends that his convictions on the counts of substantive

mail and wire fraud violations were also erroneous because they were

tainted by the invalidity of the Count 1 conspiracy count. That is so,

he says, because on those counts the trial court instructed the jury that

it could convict him of foreseeable offenses committed by his

coconspirators during the course of the conspiracy, pursuant to

Pinkerton v. United States, 328 U.S. 640 (1946). J.A. 1529. We do

not reach this contention in light of the disposition we reach on his

challenge to Count 1.

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right.” Slack, 529 U.S. at 478.10 Baxter points to Skilling as

demonstrating that his trial was tainted by constitutional error

because of the possibility that the jury rested its verdict on the

honest-services fraud theory of conspiracy. While the

government contends that the court’s instruction on honestservices fraud amounted to harmless error because the flawed

instruction did not have a “substantial and injurious effect or

influence in determining the jury’s verdict,” Hedgepeth v.

Pulido, 555 U.S. 57, 58 (2008) (internal quotation marks

omitted), we conclude that jurists of reason would find debatable

whether the submission of the invalid honest-services theory to

the jury was harmless. We therefore grant the certificate of

appealability. 

2. Although we grant a certificate of appealability, there is

another hurdle that Baxter must overcome before we can address

the merits of his appeal. Baxter did not challenge his conviction

on the honest-services fraud theory at trial or on direct appeal. 

As a consequence, he “procedurally defaulted the claim he now

10Slack also held that, “when the district court denies a habeas

petition on procedural grounds without reaching the prisoner’s

underlying constitutional claim, a [certificate of appealability] should

issue . . . if the prisoner shows, at least, that jurists of reason would

find it debatable whether the petition states a valid claim of the denial

of a constitutional right, and that jurists of reason would find it

debatable whether the district court was correct in its procedural

ruling.” Id. (emphasis added). Although there was a procedural

default in this case, see infra Part III.2, the district court did not deny

the § 2255 motion on procedural grounds, and we therefore consider

only the first prong of the Slack test in deciding whether to grant a

certificate of appealability.

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presses on us.” Bousley v. United States, 523 U.S. 614, 621

(1998); see id. at 620-22.11

In Bousley, the Court explained that, “[w]here a defendant

has procedurally defaulted a claim by failing to raise it on direct

review, the claim may be raised in habeas only if the defendant

can first demonstrate either [1] ‘cause’ and actual ‘prejudice,’

. . . or [2] that he is ‘actually innocent.’” Id. at 622 (citations

omitted); see also McQuiggin v. Perkins, 133 S. Ct. 1924, 1931-

32 (2013). Baxter does not argue that there was a “cause” that

excused the procedural default.12 Instead, he relies on the

“actual innocence” exception, contending that his innocence of

fraud on the honest services theory suffices to excuse his

procedural default. 

11The government does not assert that Baxter also defaulted his

claim on timeliness grounds, as it does with respect to his Adefehinti

claim, see infra Part IV. Rather, it concedes that Baxter’s claim based

on Skilling, which was not decided until June 2010, was timely. Gov’t

Br. 4 & n.4. 

12The fact that the Supreme Court had not yet decided Skilling at

the time of Baxter’s 2005 trial or 2008 direct appeal is insufficient to

demonstrate “cause.” As the Court explained in Bousley, “[w]hile we

have held that a claim that ‘is so novel that its legal basis is not

reasonably available to counsel’ may constitute cause for a procedural

default, . . . petitioner’s claim does not qualify as such [because the

claim] . . . was most surely not a novel one.” 523 U.S. at 622. It was

not novel, the Court said, because “the Federal Reporters were replete

with cases involving” such challenges. Id. The same was true at the

time of Baxter’s trial regarding the Skilling-like claim that he raises

here. See, e.g., United States v. Rybicki, 354 F.3d 124, 144 (2d Cir.

2003) (en banc); United States v. Welch, 327 F.3d 1081, 1106 (10th

Cir. 2003); United States v. Easton, 54 F. App’x 242, 243-44 (8th Cir.

2002); United States v. Frost, 125 F.3d 346, 371 (6th Cir. 1997); id.

at 370 n.7 (collecting cases).

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In response, the government again contends that the Skilling

error was harmless. Gov’t Br. 22. This contention, however,

puts the cart before the horse because we cannot address the

merits of Baxter’s Skilling claim unless he overcomes his

procedural default. We therefore begin (and end) with the

question of Baxter’s actual innocence.

“To establish actual innocence, petitioner must demonstrate

that, in light of all the evidence, it is more likely than not that no

reasonable juror would have convicted him.” Bousley, 523 U.S.

at 623 (internal quotation marks omitted); see United States v.

Caso, 723 F.3d 215, 218-19 (D.C. Cir. 2013). But convicted

him of what? In all previous “actual innocence” cases except

Bousley (which we discuss below), the Supreme Court has

required the petitioner to demonstrate his actual innocence of the

offense of which he was convicted.13

Although the Court has not yet considered the meaning of

“actual innocence” in the context of a case in which a jury

returned a general verdict when instructed on alternative theories

of guilt, the rationale for the “actual innocence” exception to

procedural default dictates that the defendant must show his

13See, e.g., McQuiggin, 133 S. Ct. at 1936 (remanding for further

proceedings to determine whether the petitioner’s challenge to his

murder conviction met the actual innocence standard); Schlup v. Delo,

513 U.S. 298, 332 (1995) (same); House v. Bell, 547 U.S. 518, 555

(2006) (concluding that the petitioner made the requisite showing of

actual innocence regarding his murder conviction to overcome

procedural default); see also Sawyer v. Whitley, 505 U.S. 333, 340

(1992) (“A prototypical example of ‘actual innocence’ in a colloquial

sense is the case where the State has convicted the wrong person of the

crime.”).

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innocence of each of the alternative theories.14 As the court

explained in McQuiggin, “[t]his rule, or fundamental

miscarriage of justice exception, is grounded in the ‘equitable

discretion’ of habeas courts to see that federal constitutional

errors do not result in the incarceration of innocent persons.” 

133 S. Ct. at 1931 (quoting Herrera, 506 U.S. at 404). Or, as

the Court put it in McCleskey v. Zant, the exception is designed

to excuse procedural barriers to relief in only a “narrow class”

of “extraordinary instances when a constitutional violation

probably has caused the conviction of one innocent of the

crime.” 499 U.S. 467, 494 (1991). Unless Baxter can show that

he is innocent of both money-and-property fraud and honestservices fraud, he cannot show that the Skilling error “probably

has caused the conviction of one innocent of the crime” of

14This is true at least when conviction on each of the other

theories would lead to the same or a greater sentence than conviction

on the invalid theory. See Caso, 723 F.3d at 223 (stating, in the

context of evaluating an offense the government forwent because of

a plea bargain, that “we should not require a person to spend 30 years

in prison on an erroneous . . . conviction because he was guilty of [a

less serious] offense that would carry a [lesser] sentence.”). In this

case, there is no claim that conviction on a money-and-property theory

would have led to a different (or lesser) sentence than conviction on

an honest-services theory. See Baxter Presentence Investigation

Report ¶¶ 46-47 (grouping the conspiracy count, the substantive

counts that were its objects, and the money laundering counts together

“because . . . the offense level is determined largely on the basis of the

total amount of harm or loss”; noting that, in those circumstances, the

“offense level applicable to the Group is the offense level

corresponding to the aggregated quantity” and that the court is to

apply “the offense guideline that produces the highest offense level”;

and concluding that the money laundering conspiracy count produced

the highest offense level).

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which he was convicted: namely, conspiring to commit mail

and wire fraud. Moreover, if we were to apply the exception

whenever any one of several alternative theories of fraud were

ruled invalid, it would no longer remain, as the Court

contemplated, a “rare” exception “only . . . applied in the

extraordinary case,” id. at 321. See McQuiggin, 133 S. Ct. at

1928 (noting that the “standard is ‘demanding’ and seldom met”

(quoting House, 547 U.S. at 538)).

Bousley considered what a defendant must show to prove

his “actual innocence” when he pled guilty pursuant to a plea

agreement, rather than -- as in the Court’s other cases -- when he

was convicted after a trial. Kenneth Bousley pled guilty to

“using” a firearm during a drug trafficking crime in violation of

18 U.S.C. § 924(c)(1), a provision that makes it unlawful to use

or carry a firearm during such a crime. After the Supreme Court

clarified that “using” means “active employment,” see Bailey v.

United States, 516 U.S. 137, 143 (1995), Bousley supported his

28 U.S.C. § 2255 motion with a claim that his guilty plea was

involuntary because he had been misinformed about the

elements of the § 924(c)(1) offense. The Court held that,

although Bousley had procedurally defaulted his challenge by

failing to raise it on direct appeal, a court could still review his

claim in habeas if he could establish his actual innocence of the

offense to which he pled guilty. Bousley, 523 U.S. at 622-23. 

Moreover, the Court stated that, “[i]n cases where the

Government has forgone more serious charges in the course of

plea bargaining, petitioner’s showing of actual innocence must

also extend to those charges.” Id. at 624. 

In Bousley, the government argued that the petitioner should

have to demonstrate that he was actually innocent of both

“using” and “carrying” a firearm in violation of § 924(c)(1). 

The Court rejected the argument, holding that he need

demonstrate only that he did not “use” the firearm as defined in

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Bailey. 523 U.S. at 624. It did so, the Court said, because

“petitioner's indictment charged him only with ‘using’ firearms

in violation of § 924(c)(1) . . . [a]nd there [wa]s no record

evidence that the Government elected not to charge petitioner

with ‘carrying’ a firearm in exchange for his plea of guilty.” Id.

In Baxter’s case, by contrast, the indictment charged alternative

means of violating the charged statute: It charged him with

conspiring to commit mail and wire fraud on both honestservices and money-and-property theories. J.A. 225-26. Thus,

Bousley further supports the conclusion that Baxter must

demonstrate his actual innocence of both objects of the

conspiracy.15

Baxter maintains that he should not have to demonstrate his

actual innocence of money-and-property fraud because we

cannot be sure that his jury did not convict him on the invalid

honest-services theory. Thus, he argues, the instruction had a

“‘substantial and injurious effect or influence in determining the

jury’s verdict.’” Baxter Br. 37 (quoting Hedgpeth, 555 U.S. at

58). But this is the standard for harmful error on the merits, see

Hedgpeth, 555 U.S. at 58, not for the actual innocence required

to overcome a procedural bar. The type of “actual innocence”

claim that Baxter presses is “‘not itself a constitutional claim,

but instead a gateway through which a habeas petitioner must

pass to have his otherwise barred constitutional claim considered

on the merits.’” Schlup, 513 U.S. at 315 (quoting Herrera, 506

15In Caso, we suggested that the most likely rationale for

Bousley’s rule -- that the showing of actual innocence must extend to

more serious, and likely equally serious, charges forgone in exchange

for a plea bargain -- is that the rule ensures “the defendant does not

receive an unjustified ‘windfall.’” Caso, 723 F.3d at 223 (quoting

Lewis v. Peterson, 329 F.3d 934, 936 (7th Cir. 2003)). This rationale

applies a fortiori to alternative theories of an offense upon which a

defendant was actually charged and convicted.

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U.S. at 404). Without a demonstration of actual “innocence,

even the existence of a concededly meritorious constitutional

violation is not in itself sufficient to establish a miscarriage of

justice that would allow a habeas court to reach the merits of a

barred claim.” Id. at 316.

In sum, we conclude that, to establish “actual innocence” to

overcome his procedural default, Baxter must demonstrate that

“it is more likely than not that no reasonable juror would have

convicted him” of the offense of which he was convicted,

Bousley, 523 U.S. at 623 (internal quotation marks omitted). 

That offense was conspiracy to commit either honest-services

fraud or money-or-property fraud, and Baxter must demonstrate

his actual innocence of that offense. 

3. Baxter cannot show that it is more likely than not that he

was actually innocent of conspiracy to commit money-orproperty fraud. Indeed, Baxter’s briefs say nothing in support

of such a showing, other than to declare that he “was not

stealing money and/or property from the WTU,” Baxter Br. 30,

and that he “obtained nothing to which he was not entitled as

Treasurer.” Reply Br. 21. The evidence is entirely to the

contrary, as we laid out in Part I above, and as we said in our

decision on Baxter’s direct appeal:

For approximately seven years, Bullock,

Hemphill, Baxter, and friends appropriated for their

own benefit much of the money union members paid as

dues. They embezzled these funds through several

channels, including American Express (Amex) cards

issued on WTU’s account, checks written for

fraudulent purposes and for excessive amounts, and

payments to a front company, Expressions Unlimited. 

All union checks required two signatures, those of

Bullock and Baxter, the union’s president and treasurer

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respectively. These two, therefore, had the key to the

union treasury.

Initially, Bullock and Baxter simply used their

WTU Amex cards for personal expenses, and they

spent quite a lot. But the thefts became more

audacious when Hemphill was hired as Bullock's

secretary and then also became the union’s

bookkeeper. . . .

Between 1995 and 2002, the conspirators stole

millions of dollars from WTU and spent it on such

things as a $50,000 silver set for Bullock’s house, a

wedding reception for Hemphill’s son, $29,000 in

dental work for her and her husband, $19,000 in

Washington Wizards tickets for Baxter and Bullock,

car insurance for him, and art for his house. 

Sometimes they simply wrote themselves checks from

the union treasury. After WTU received an infusion of

cash from the inflated assessment in 2002, Hemphill

and Baxter wrote themselves more checks totaling

$18,805 and $31,000, respectively.

514 F.3d at 1354. Baxter’s briefs neither say anything, nor point

to any evidence, that would cause us to reach a different

conclusion here than we did on direct appeal.

In sum, although it is clear that Baxter was innocent of

conspiring to commit honest-services fraud because the scheme

did not involve bribery or kickbacks, it is equally clear that he

cannot show he was actually innocent of conspiracy to commit

money-or-property fraud. Accordingly, he cannot overcome the

procedural default that bars us from considering his Skilling

claim on the merits.

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IV

Finally, Baxter contends that his conviction for money

laundering under 18 U.S.C. § 1956(a)(1)(B)(i) was invalid in

light of this court’s decision in United States v. Adefehinti, 510

F.3d 319 (D.C. Cir. 2007). 

Once again, Baxter requires a certificate of appealability to

proceed and, once again, we grant it. See supra Part III.1. 

Baxter’s Adefehinti claim, while not explicit, appears to be that

he was convicted under a legally invalid theory of money

laundering because the alleged money laundering was not

distinct from the crimes that produced the funds that were

laundered. This would make his Adefehinti claim similar to his

Skilling claim. See Skilling, 561 U.S. at 414 (“[C]onstitutional

error occurs when a jury . . . returns a general verdict that may

rest on a legally invalid theory.”). The underlying question of

what legally constitutes money laundering is a difficult one, and

we therefore conclude that “jurists of reason would find it

debatable whether [Baxter’s] petition states a valid claim of the

denial of a constitutional right,” Slack, 529 U.S. at 478. See

Adefehinti, 510 F.3d at 322 (“It seems clear that . . . the

necessary intent to conceal requires ‘something more’ than the

mere transfer of unlawfully obtained funds, though that

‘“something more” is hard to articulate.’” (quoting United States

v. Esterman, 324 F.3d 565, 572 (7th Cir. 2003))).

But Baxter again faces another hurdle. Under AEDPA,

Baxter had one year from “the date on which [his] judgment of

conviction bec[ame] final” to file his § 2255 motion. 28 U.S.C.

§ 2255(f)(1). Baxter agrees that his conviction became final on

November 10, 2008, the date the Supreme Court denied his

petition for a writ of certiorari. See United States v.

Aguirre-Ganceda, 592 F.3d 1043, 1045 (9th Cir. 2010)

(agreeing with “the seven other circuits that have reached th[e]

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22

issue” that a conviction becomes final when a petition for

certiorari is denied, not when a subsequent petition for rehearing

is denied). But he did not file the motion until more than a year

after that date, not until January 11, 2010, thus rendering his

filing untimely.

Although Baxter acknowledges that his motion was

untimely, he maintains that he is entitled to equitable tolling. A

federal habeas petitioner “is entitled to equitable tolling only if

he shows (1) that he has been pursuing his rights diligently, and

(2) that some extraordinary circumstance stood in his way and

prevented timely filing.” McQuiggin, 133 S. Ct. at 1931

(quoting, inter alia, Holland v. Florida, 560 U.S. 631, 649

(2010)) (internal quotation marks omitted); see United States v.

McDade, 699 F.3d 499, 503 (D.C. Cir. 2012). The only

circumstance that Baxter proffers is that he “relied on orders

entered by the district judge” that enlarged the time for filing

until July 15, 2010. Baxter Br. 27-28. But the district court did

not enter that order until January 14, 2010, two months after the

filing deadline had passed and three days after Baxter filed his

motion. See Order on Motion for Leave to File, United States

v. Baxter, No. 03-CR-516 (D.D.C. Jan. 14, 2010). Needless to

say, Baxter could not have let the deadline pass in reliance upon

an order that the court had not yet entered. 

Although he has procedurally defaulted, that is, yet again,

not the end of the matter. In McQuiggin v. Perkins, the Supreme

Court held that “actual innocence, if proved, serves as a gateway

through which a petitioner may pass whether the impediment is

a procedural bar . . . or . . . expiration of the statute of

limitations” contained in AEDPA. 133 S. Ct. at 1928. Baxter

maintains that he is, in fact, actually innocent of “money

laundering” under 18 U.S.C. § 1956. As we said above, to

demonstrate actual innocence, “the petitioner must demonstrate

that, in light of all the evidence, it is more likely than not that no

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reasonable juror would have convicted him” of that offense,

Bousley, 523 U.S. at 623 (quoting Schlup, 513 U.S. at 327-28);

see Caso, 723 F.3d at 218-19. This, the Supreme Court

“stress[ed]” in McQuiggin, is a “demanding” standard. 133 S.

Ct. at 1936.

The provision of the money laundering statute at issue in

Baxter’s case applies to: 

Whoever, knowing that the property involved in a

financial transaction represents the proceeds of some

form of unlawful activity, conducts . . . such a financial

transaction which in fact involves the proceeds of

specified unlawful activity-- . . . (B) knowing that the

transaction is designed in whole or in part-- (i) to

conceal or disguise the nature, the location, the source,

the ownership, or the control of the proceeds of

specified unlawful activity.

18 U.S.C. § 1956(a)(1)(B)(i). Baxter’s claim of actual

innocence rests on our statement in Adefehinti that the

“‘transaction or transactions that created the criminally derived

proceeds must be distinct from the money laundering

transaction.’” Baxter Br. 41 (quoting Adefehinti, 510 F.3d at

324).16 In other words, to launder money, a defendant must have

money to launder. Or, as the statute says, a money laundering

16See also Adefehinti, 510 F.3d at 322 (“The money laundering

statute . . . has no application to the transparent division or deposit of

[illegally obtained] proceeds.”); id. at 324 (“Having carried out a fraud

of which concealment was an integral part, defendants cannot be

charged with the same concealment a second time, as if it were the sort

of independent manipulation of the proceeds required for money

laundering.”). 

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transaction must “in fact involve[] the proceeds of specified

unlawful activity.” 18 U.S.C. § 1956(a)(1).

Because he seeks to invoke the actual innocence exception

to the statute of limitations in 28 U.S.C. § 2255(f), Baxter bears

the burden to show actual, “factual innocence.” Bousley, 523

U.S. at 623-24. But he has made no serious attempt to pinpoint

what a reasonable juror would -- or would not -- consider

proceeds and why subsequent transactions involving those

proceeds could not manifest an intent “to conceal or disguise the

nature, the location, the source, the ownership, or the control of

the proceeds,” as required by § 1956(a)(1)(B)(i). The treatment

of the subject in Baxter’s opening brief covers less than a page. 

It merely recites the elements of money laundering and then

claims that “no matter how the facts are twisted, the transactions

that created the criminally derived proceeds are not separate and

distinct from the money laundering transaction.” Baxter Br. 41. 

Because he does not revisit the claim in his reply brief at all, this

one sentence constitutes his entire argument on the subject. 

Without more, we cannot conclude that it is more likely

than not that no reasonable juror would find an intent to conceal

based on transactions that took place after proceeds existed. For

example, Baxter signed WTU checks that initially went to a

front company, Expressions Unlimited, and to a frontman,

LeRoy Holmes. Hemphill and Bullock then instructed the fronts

to transfer the proceeds to Bullock’s personal account before she

paid her WTU credit card bills out of her supposedly personal

funds. See supra Part I. A reasonable juror could conclude that

those transactions involved unlawful proceeds and that those

transfers by the fronts were designed to conceal the money’s

illicit origins. Such a juror might infer that the conspirators

feared that direct payment of such bills out of the fronts’

accounts might stir the curiosity of a vigilant WTU employee or

external auditor reviewing credit card statements, more so than

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would portraying the payment as merely that of an employee

paying her personal expenses out of her personal account. 

Baxter’s terse briefing of the issue fails to explain why such an

inference by a juror would be unreasonable, and we cannot

independently verify its reasonableness because Baxter has

presented such a meager and non-analytical account of the

evidence. 

Accordingly, we cannot say it is more likely than not that

no reasonable juror would have found the requisite concealment

in transactions occurring after proceeds existed. Indeed, we note

that, on direct appeal, Baxter and Hemphill raised a nearly

identical argument -- that they could not be convicted of money

laundering because the government did not prove that the

transactions creating the proceeds were distinct from the

transactions laundering them. See Baxter Br. 30-32, Hemphill

Br. 52-55, Hemphill, 514 F.3d 1350 (D.C. Cir. 2008) (No. 06-

3089).17 In response, we concluded, tersely, that there was

“abundant proof of the acts of concealment.” Hemphill, 514

F.3d at 1362.18 In effect, then, we have already concluded that

17See also Baxter Hemphill Br. 32 (“In short, the Government’s

theory at trial impermissibly allowed the jury to commingle the initial

transactions that formed the basis of the unlawful activity with the

transactions that ‘washed’ those illegal proceeds ‘clean’” (quoting

United States v. Seward, 272 F.3d 831, 836 (7th Cir. 2001)));

Hemphill Hemphill Br. 55 (“[I]n effect, the Government claimed that

it could prove embezzlement and have it punished as money

laundering.”). Although Baxter’s Hemphill brief did not cite

Adefehinti (which issued after oral argument in Hemphill but before

the opinion was released), it did cite United States v. Seward, 272 F.3d

at 836, a case upon which Adefehinti relied for the same proposition. 

See Adefehinti, 510 F.3d at 324.

18Although this portion of the Hemphill opinion was addressed to

Hemphill’s money laundering challenge, Baxter expressly joined that

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26

a reasonable juror could have found Baxter guilty of money

laundering. Baxter’s briefing of the issue on this appeal

provides no support -- and no reference at all to relevant

evidence -- for the opposite proposition. As a consequence, he

has failed to shoulder his burden to show the actual innocence

required to overcome his untimely filing.

V

For the foregoing reasons, we conclude that Baxter is not

entitled to relief. The judgment of the district court is

Affirmed.

portion of her brief. See Baxter Hemphill Br. 16 n.1.

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