REVISED MAY 22, 2014

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 12-30926

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

v.

GEORGE L. GRACE, SR.,

Defendant-Appellant.

Appeal from the United States District Court 

for the Middle District of Louisiana

USDC No. 3:10-CR-143

Before DAVIS, BARKSDALE, and ELROD, Circuit Judges.

PER CURIAM:* 

Defendant-Appellant George Grace, Sr. (“Grace”), the former mayor of a 

small town in Louisiana, appeals his conviction for corruption-related offenses, 

as well as his sentence. We affirm his conviction, vacate the sentence imposed 

by the district court, and remand for further proceedings consistent with this 

opinion.

* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not 

be published and is not precedent except under the limited circumstances set forth in 5TH 

CIR. R. 47.5.4.

United States Court of Appeals

Fifth Circuit

FILED

May 21, 2014

Lyle W. Cayce

Clerk

 

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I.

Grace is the former mayor of the City of St. Gabriel, LA. The Federal 

Bureau of Investigation (“FBI”) began investigating reports of corruption 

involving Grace in 2006 after it received a tip from local law enforcement in St. 

Gabriel. From late 2006 through the summer of 2010, the FBI conducted a 

series of four undercover investigations into Grace’s conduct. Those 

investigations included: 1) relief efforts in St. Gabriel after Hurricane Katrina 

(“the Hurricane Katrina Scheme”); 2) a vendor doing business with the City of 

St. Gabriel (“the City Vendor Scheme”); 3) the sale and development of real 

estate in St. Gabriel (“the Real Estate Scheme”); and 4) a fictional product for 

cleaning garbage cans known as the Cifer 5000 (the “Cifer Scheme”). 

Following the FBI investigation, a grand jury returned a 13-Count 

indictment against Grace. After trial, a jury convicted Grace on seven of the 

thirteen Counts. Grace now appeals his conviction on the following five Counts: 

a) Count 1, charging a violation of the Racketeer Influenced and Corrupt 

Organizations Act (“RICO”), 18 U.S.C. § 1961 et seq.; b) Count 8, charging 

federal program bribery in violation of 18 U.S.C. § 666; c) Count 9, charging

honest services and property mail fraud in violation of 18 U.S.C. §§ 1341 and 

1346; d) Count 11, charging honest services and property wire fraud in 

violation of 18 U.S.C. §§ 1343 and 1346; and e) Count 13, charging use of an 

interstate facility (telephone) in aid of racketeering in violation of 18 U.S.C. § 

1952. Finally, Grace also appeals the 22-year sentence imposed by the district 

court.

The Counts which Grace appeals involve two of the four schemes 

mentioned above: the Real Estate Scheme and the Cifer Scheme, which we will 

discuss below, including the facts relevant to those schemes.

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II.

We address Grace’s convictions in four groups: a) Count 9 for honest 

services fraud and property mail fraud in violation of 18 U.S.C. §§ 1341 and 

1346, and Count 11 for mail and wire fraud in violation of 18 U.S.C. §§ 1343 

and 1346; b) Count 13 for use of a telephone to violate the Louisiana state 

public bribery statute in violation of 18 U.S.C. § 1952; c) Count 8 for federal 

program bribery in violation of 18 U.S.C. § 666; and d) Count 1, the RICO 

violation. 

a. Grace’s convictions in Counts 9 and 11

The charges in Counts 9 and 11 concern two official letters of support

Grace provided to undercover FBI Special Agent Darin McAllister 

(“McAllister”) and cooperating FBI witness William Myles (“Myles”) during a 

sting operation. Agent McAllister and Myles posed as representatives of Cifer 

5000 (“Cifer”), a fictitious company which provided garbage-can-cleaning 

services. Agent McAllister operated under the alias of “DJ,” and held himself 

out as the financial partner in the Cifer business. In exchange for several 

thousand dollars, Grace provided letters supporting Cifer to Agent McAllister 

and Myles. In these letters, Grace, in his official position as Mayor of St. 

Gabriel, strongly endorsed Cifer and falsely represented that he was in the 

process of bringing the Cifer service to his City. The letter Grace gave to Agent 

McAllister was intended to persuade potential private investors to invest 

money in Cifer (the “Private Investor Letter”). The letter Grace gave to Myles 

was intended to help Cifer secure a grant from the Environmental Protection 

Agency (the “EPA Letter”).

Grace argues that the convictions in Counts 9 and 11 should be vacated 

for three reasons. First, his conviction in Count 9 should be vacated because 

he was not permitted to examine Agent McAllister at trial, which violated his 

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right to due process. Second, the convictions on both Counts 9 and 11 should 

be set aside because there was insufficient evidence to show that Grace had 

the specific intent to defraud potential investors and the EPA of money. And 

third, the convictions should be vacated because the district court improperly 

instructed the jury that it is not a defense that the public official involved 

would have performed the official action regardless of the bribe. 

i. Due Process

Grace was convicted in Count 9 for honest services and mail fraud, in 

violation of 18 U.S.C. §§ 1341 and 1346, for causing the mailing of the Private 

Investor Letter to Agent McAllister, who was posing as “DJ.” In the Letter, 

Grace vouched for the Cifer service as Mayor of St. Gabriel and falsely claimed 

he had presented the idea of using the service to the city council and they were 

making progress toward a contract with Cifer. In exchange for writing the 

Letter, Agent McAllister wired Grace $8,000 to pay for Grace and his associate

to travel to Libya and Uganda. Agent McAllister’s recorded statements to 

Grace during the sting operation were introduced at trial, but he did not testify. 

Instead, when called as a witness by Grace, Agent McAllister properly asserted 

his Fifth Amendment privilege against self-incrimination which arose out of 

an unrelated investigation for fraud-related offenses. Grace contends his 

inability to examine Agent McAllister violated his right to due process under 

the Fifth Amendment, and therefore his conviction in Count 9 should be 

vacated. 

The parties dispute the standard of review because they disagree 

whether Grace sufficiently objected at trial so as to preserve the error. We 

conclude, however, that this argument is without merit regardless of which 

standard of review is applied. At trial, Grace made the only arguable objection

available to him under the Sixth Amendment’s Confrontation Clause. That 

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objection is meritless. Agent McAllister’s statements were not admitted for 

their truth. The government never contended they were true. To the contrary, 

they were obviously untrue as they were made in the context of a sting 

operation. The statements were admitted to show that the offer of a payment 

was made to Grace, who then accepted the offer. What Agent McAllister said 

(as opposed to the truth of the statement) and Grace’s response are direct 

evidence of the crime. “[T]he Confrontation Clause does not bar the use of 

testimonial statements for purposes other than establishing the truth of the 

matter asserted. Instead, to constitute a Confrontation Clause violation, the 

statement must be used as hearsay—in other words, it must be offered for the 

truth of the matter asserted.”1

Nor does the admission of Agent McAllister’s recorded statements violate 

Grace’s right to due process. A violation of a defendant’s rights under the Due 

Process Clause of the Fifth Amendment “requires some showing that the 

evidence lost would be both material and favorable to the defense.”2 Grace fails 

to show that McAllister’s testimony would have been either favorable to his 

defense or material. He speculates that, on cross-examination, he would have 

been able to establish that Grace was not attentive during his conversations 

with McAllister and did not hear McAllister’s statements. But Grace testified 

at trial that he heard McAllister’s statements which linked payments to the 

writing of the Private Investor Letter. Also, evidence of this scheme was 

1 United States v. Polidore, 690 F.3d 705, 719 n.15 (5th Cir. 2012) (citations and internal 

quotation marks omitted); see also United States v. Tolliver, 400 F. App’x 823, 830 (5th Cir. 

2010) (“Statements not offered for their truth, even if testimonial in nature, are not subject 

to [the protections of the Confrontation Clause].”) (citing United States v. Holmes, 406 F.3d 

337, 349 (5th Cir. 2005)).

2 United States v. Valenzuela-Bernal, 458 U.S. 858, 873 (1982); see also United States v. 

Villanueva, 408 F.3d 193 (5th Cir. 2005).

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corroborated by the Letters provided to both Agent McAllister and Myles, 

Grace’s confession during an FBI interview, and, in some instances, Myles’s 

testimony. Both the Confrontation Clause and due process arguments are 

meritless. Thus, the district court did not err when it admitted the recorded 

conversations which included Agent McAllister’s statements.

ii. Insufficient Evidence

Grace next contends that his convictions in Counts 9 and 11 should be 

set aside because the evidence was insufficient to prove he had specific intent 

to defraud the Cifer investors. Count 9 charged Grace with honest services and 

mail fraud for providing the Private Investor Letter, discussed above. To obtain 

a conviction for mail fraud under § 1341, the government must prove “(1) a 

scheme to defraud; (2) the use of the mails to execute the scheme; and (3) the 

specific intent to defraud.”3 Count 11 charged Grace with use of the wires in 

connection with a scheme to defraud the EPA of money and property, in 

violation of 18 U.S.C. §§ 1343 and 1346. The elements of wire fraud under § 

1343 are: “(1) a scheme to defraud and (2) the use of, or causing the use of, wire 

communications in furtherance of the scheme.”4 In order to convict for the 

federal crime of honest services fraud under § 1346, the government “‘must 

prove that the conduct of a state official breached a duty respecting the 

provision of services owed to that official’s employer under state law.’”5 In 

Count 11, the fraud was based on the letter that Grace signed and sent to the 

EPA praising Cifer to assist Cifer in obtaining a grant from the EPA to finance

the Cifer services in St. Gabriel and other cities. Like the Private Investor 

3 United States v. Bieganowski, 313 F.3d 264, 275 (5th Cir. 2002) (citation omitted).

4 United States v. Stalnaker, 571 F.3d 428, 436 (5th Cir. 2009).

5 United States v. Whitfield, 590 F.3d 325, 348 (5th Cir. 2009) (quoting United States v. 

Brumley, 116 F.3d 728, 734 (5th Cir. 1997) (en banc)).

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Letter, the EPA Letter contained false representations by Grace that the City 

was progressing toward implementing the Cifer system. Myles wired Grace 

$1,000 into his personal account in exchange for providing the Letter.

Again, the parties dispute the standard of review. We find that, 

regardless of which standard is applied, Grace’s sufficiency argument is 

meritless.

Grace argues that the evidence presented by the government was 

sufficient to prove, at most, that he had knowledge the fraud would occur, and 

not that he had the specific intent to defraud. 

Mail and wire fraud both require a specific intent to defraud. 6 The 

district court properly instructed the jury that “[a]n ‘intent to defraud’ means 

an intent to deceive or cheat someone,”7 and that the jury “may also consider 

the natural and probable results of any acts the defendant knowingly did or 

did not do, and whether it is reasonable to conclude that the defendant 

intended those results.” The jury was entitled to find from the evidence that 

Grace knew the Letters he wrote contained false representations, and that 

Grace’s objective was to persuade investors and the EPA to give money based 

in part on those lies. Grace admitted as much in an FBI interview, and at trial. 

For example, when asked by the Assistant U.S. Attorney, “And you had no 

problem with the fact thatthey [Myles and Agent McAllister] were going to use 

a false letter to raise money?” Grace responded, “That would be on them . . . as 

far as I was concerned.” 8 Here, the evidence of Grace’s knowledge of the 

6 See United States v. Bernegger, 661 F.3d 232, 240 (5th Cir. 2011) (mail fraud); United States 

v. Radley, 632 F.3d 177, 185 (5th Cir. 2011) (wire fraud).

7 FIFTH CIRCUIT PATTERN JURY INSTRUCTIONS (Criminal Cases) § 2.59 (2001).

8 In addition, the following testimony from Grace on cross examination reveals his knowledge 

of the falsehoods:

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scheme and the role his Letters played in furthering the scheme was sufficient 

for the jury to find that Grace acted with the specific intent required for Counts 

9 and 11.

iii. Improper Jury Instruction

Third, Grace argues that this court should vacate his convictions in 

Counts 9 and 11 because the district court issued an improper jury instruction 

as to honest services fraud. Grace claims the district court erred when it issued 

the following jury instruction: “It is not a defense [to honest services fraud] to 

claim that a public official would have lawfully performed the official action in 

question even without having accepted a thing of value.” 

Honest services fraud in the form of bribery requires proof of a quid pro 

quo and, therefore, the Government must prove “a specific intent to give or 

receive something of value in exchange for an official act.”9 According to Grace, 

the jury instruction was improper because if an “official would have performed 

Q: So you’re – if I understand it correctly, you were okay with letting this false, 

fraudulent letter out to investors because you didn’t figure that they would 

ultimately invest anything. So you were fine with that; is that what you’re 

saying?

A: I didn’t think there were any businessmen anywhere who would not look at 

the facts and the figures before they would invest that kind of money in a 

venture like that. If anybody would be venture capitalists, they would want to 

know the populations, the facts and the figures from those six towns that he 

was talking about, and that would not give anybody cause to invest $2 to 3 

million, Mr. Amundson.

Q: So you didn’t mind lying to them?

A: He wanted the letter; I gave it.

Q: That’s a “yes” or a “no,” sir.

A: Yes.

9 United States v. Sun-Diamond Growers of Cal., 526 U.S. 398, 404–05 (1999) (emphasis in 

original).

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the specified act anyway, the official would not have taken the bribe with the 

intent to be influenced, and there would have been no corrupt exchange.” 

Grace failed to raise this objection at the trial court. We therefore review 

this argument for plain error, and find that the district court did not err in 

giving this instruction.

As the Government correctly points out, Skilling v. United States holds 

that honest services fraud under 18 U.S.C. § 1346 encompasses only bribery 

and kickback schemes.10 To define “bribery” and “kickbacks,” the Court in 

Skilling directed courts to look to federal statutes defining similar crimes, such 

as 18 U.S.C. §§ 201 (defining bribery of federal officials) and 666 (defining 

bribery concerning federally funded entities).11 We have interpreted § 666 to 

mean that a public official can be guilty of bribery “even if he has no intention 

of actually fulfilling his end of the bargain.”12 The decisive factor is that the 

public official has “corruptly entered into a quid pro quo, knowing that the 

purpose behind the payment that he has received, or agreed to receive, is to 

induce or influence him in an official act.” 13 The jury instruction was 

consistent with Skilling. It is enough that Grace took the money with the 

knowledge that it was intended to influence him, even if he would have written 

the Letters without the payment. Accordingly, the district court committed no 

error, plain or otherwise, in giving this instruction, regardless of the standard 

of review.

b. Grace’s conviction in Count 13

10 130 S. Ct. 2896, 2928–31 (2010).

11 Id. at 2933–34.

12 United States v. Valle, 538 F.3d 341, 347 (5th Cir. 2008).

13 Id.

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Grace’s conviction in Count 13 involves his use of his official influence as 

Mayor of St. Gabriel to promote the Cifer system. Grace helped organize 

meetings to introduce a group of fellow mayors from nearby cities to Myles and 

Agent McAllister. These meetings were organized to provide Myles and Agent 

McAllister the opportunity to discuss the Cifer system with the other mayors, 

and assist Myles and Agent McAllister in selling the Cifer service to their 

cities. During the meetings, Myles expressed his desire to obtain contracts with 

each of the cities, and made it clear he was willing to pay the mayors for their 

support. After at least two of the meetings, Grace accepted a $2,000 payment 

from Myles and Agent McAllister for his work in promoting the Cifer service 

with the other mayors, and the use of his official influence to persuade them.

Grace argues his conviction in Count 13 should be vacated for two 

reasons: first, because there was insufficient evidence presented at trial that 

his conduct constituted an “official action” as Mayor of St. Gabriel; and second, 

because the district court’s jury instruction on “official action” was overbroad. 

i. Sufficiency of the evidence

Grace was convicted in Count 13 for use of a telephone in aid of 

racketeering in violation of 18 U.S.C. § 1952, which makes it a federal crime to 

use an interstate facility with the intent to carry on any “unlawful activity,”

including bribery in violation of state law.14 Specifically, the jury found that 

Grace had used a telephone with the intent of committing the offense of bribery 

under Louisiana law when he accepted $2,000 from Myles in exchange for 

14 See 18 U.S.C. § 1952 (b) (defining “unlawful activity” as “extortion, bribery, or arson in 

violation of the laws of the State in which committed or of the United States, . . . .”). Section 

1952 provides, in relevant part, “Whoever . . . uses the mail or any facility in interstate or 

foreign commerce, with intent to . . . promote, manage, establish, carry on, or facilitate the 

promotion, management, establishment, or carrying on, of any unlawful activity . . . shall be 

fined under this title, imprisoned not more than 5 years, or both . . . .” 18 U.S.C. § 1952 (a).

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promoting the Cifer service with other mayors. The Louisiana public bribery 

statute, Louisiana Revised Statutes Section 14:118(A), prohibits the receipt of 

a bribe “with the intent to influence [a person’s] conduct in relation to [one’s] 

position, employment or duty.”15 Grace argues that his promotion of the Cifer 

service with other mayors outside of St. Gabriel, and use of his influence with 

those mayors, did not fall within the scope of the official conduct described in 

the state statute.

Grace did not raise this objection at trial, so we review this claim for 

plain error.

We look to Louisiana law for the elements of its crime of bribery. The 

Louisiana Supreme Court has stated that the “gravamen” of the offense 

denounced in § 14:118 “is the giving or offering to give (as well as the 

acceptance or offer to accept) anything of present or prospective value to the 

specifically delineated public . . . official with the intent of influencing his 

conduct ‘in relation to his position, employment, or duty’ as such.”16

Unable to cite a Louisiana case to support his position, Grace contends 

that the Louisiana Supreme Court has “analogized” the definition of a public 

official’s “position, employment, or duty” under § 14:118 to an “official act” 

under the federal public bribery statute, 18 U.S.C. § 201. According to Grace, 

his exercise of influence over other mayors does not constitute an “official act” 

under federal law. However, based on this record the jury was entitled to find 

that Grace’s promotion of the Cifer service was within the range of official 

15 LA. REV. STAT. ANN. § 14:118(A).

16 State v. Smith, 212 So.2d 410, 414 (La. 1968); United States v. L’Hoste, 609 F.2d 796, 807 

(5th Cir. 1980) (“The inquiry under the Louisiana statute . . . is whether the gift is made, not 

as a Quid pro quo for specific action, but with the intent to influence the conduct of the public 

servant in relation to his position, employment, or duty.”).

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action under federal law. The definition of “official act” is quite broad, 

encompassing “any decision or action on any question, matter, cause, suit, 

proceeding or controversy, which may at any time be pending, or which may 

by law be brought before any public official, in such official’s official capacity, 

or in such official’s place of trust or profit.”17 “Official acts that violate an 

official’s official duty are not limited to those proscribed by statutes and written 

rules and regulations, but may also be found in ‘established usage,’ because 

‘duties not completely defined by written rules are established by settled 

practice, and action taken in the course of their performance must be regarded 

as within the provisions of the above-mentioned statutes against bribery.’”18

Grace contends his official mayoral duties were limited to those he owed 

to the City of St. Gabriel, and that payments for promoting the Cifer service 

outside of St. Gabriel fall outside the range of those duties. However, both the 

record in this case and prior decisions of this court support a different 

conclusion. 19 Grace’s executive assistant testified that Grace’s regular 

contacts with other mayors were part of his official duties. Other area mayors 

also testified that consulting with fellow mayors about city vendors was part 

of each mayor’s official duties. 

Thus, we conclude that the jury was entitled to find Grace’s exercise of 

influence over mayors of other cities in exchange for payments from Myles and 

17 18 U.S.C. § 201(a)(3).

18 United States v. Parker, 133 F.3d 322, 326 (5th Cir. 1998) (quoting United States v. 

Birdsall, 233 U.S. 223, 231 (1914)).

19 See United States v. Bustamante, 45 F.3d 933, 938 (5th Cir. 1995) (United States 

Congressman performed an official act when he used his influence in an effort to persuade 

the U.S. Air Force to award a contract to a particular private contractor); United States v. 

Heard, 709 F.3d 413, 422 (5th Cir. 2013) (an employee with Federal Protective Services 

performed an official act when he provided the General Services Administration with a 

favorable reference for a particular contractor).

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Agent McAllister constituted an official action, and his conviction in Count 13 

should not be vacated based on this argument. 

ii. Improper jury instruction

Grace next argues that the district court’s jury instruction on “official 

action” in Count 13 was improper because it was “overbroad.”20

We review this ruling for abuse of discretion.21 The first part of the jury 

instruction at issue stated:

The term “official action” includes every act that is within the 

range of official duty of a public official and includes any decision 

or action on any question, matter, cause, suit, proceeding or 

controversy, which may at any time be pending, or which may, by

law, be brought before any public official in such public official’s 

capacity or in such official’s official place of trust or profit.

Grace takes issue with this part of the instruction because he claims it 

has broadened the offense to include conduct that does not fall within the 

statutory definition of official action under 18 U.S.C. § 201. 22 The only 

language added by the district court not included in § 201 is near the beginning 

of its jury instruction, where it said that an official action “includes every 

20 The district court defined “official action” in its instruction in Counts 9 and 11 charging 

honest services fraud, but did not do so in its instruction in Count 13. Grace objected to the 

definition of “official action” for Counts 9 and 11 during the charge conference. However, an 

“official action” is also required for conviction in Count 13. Because Grace objected to the 

district court’s definition of this term when he had the opportunity to do so in Counts 9 and 

11, his claim of the same error to the courts’ definition of the term in Count 13 was also 

preserved.

21 United States v. Richardson, 676 F.3d 491, 506 (5th Cir. 2012).

22 Section 201 defines “official act” as:

[A]ny decision or action on any question, matter, cause, suit, proceeding or 

controversy, which may at any time be pending, or which may by law be 

brought before any public official, in such official’s official capacity, or in such 

official’s place of trust or profit.

18 U.S.C. § 201(a)(3).

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action that is within the range of official duty of a public official.” This

language mirrors the Supreme Court’s opinion in United States v. Birdsall, 

which stated that “[e]very action that is within the range of official duty comes 

within” the purview of official action.23 “In numerous instances, duties not 

completely defined by written rules are clearly established by settled practice, 

and action taken in the course of their performance must be regarded as within 

[the meaning of “official action”].”24 The language used by the district court in 

its instruction is consistent with Birdsall, and it did not err when it issued this 

part of the instruction.25

Grace then shifts his focus to the end of this jury instruction, which 

states, “It is not necessary that the public official have the authority to make 

a binding decision on the matter in question. Rather, official acts include the 

exercise of official influence through advice or recommendation to others.” 

Grace’s complaint with this section of the instruction is that “influence” is too 

vague, and includes both the exercise of influence by virtue of official power as 

well as the exercise of influence by virtue of personal respect. This is a 

23 233 U.S. at 230. See also United States v. Heard, 709 F.3d 413, 421 (5th Cir. 2013) (“We 

have recognized that the definition [of ‘official action’] is intended to ‘include any decision or 

action taken by a public official in his capacity as such,’ and official acts are ‘not limited to 

those within the official’s specific authority.’” (quoting United States v. Parker, 133 F.3d 322, 

326 (5th Cir. 1998))).

24 Id. at 231.

25 We are aware of the D.C. Circuit’s position that the broad language in “Birdsall did not . . 

. stand for the proposition that every action within the range of official duties automatically

satisfies § 201’s definition.” Valdes v. United States, 475 F.3d 1319, 1323 (D.C. Cir. 2007). 

Assuming arguendo that the D.C. Circuit is correct, we nevertheless conclude that the district 

court here did not abuse its discretion in light of the fact that it employed § 201’s specific 

language regarding the type of action that falls within the term “official action”—i.e., “any 

decision or action on any question, matter, cause, suit, proceeding or controversy, which may 

at any time be pending, or which may by law be brought before any public official, such 

official’s official capacity.” § 201(a)(3) (emphasis added). Moreover, as we explained above, 

Grace’s actions fit comfortably within the statutory definition of “official action.”

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meritless argument. The instruction itself describes only “official influence”;

there is no room for an interpretation which would include personal influence. 

c. Grace’s conviction in Count 8

Grace argues this conviction should be vacated due to the erroneous 

admission of Myles’s lay opinion testimony.26 Grace was convicted in Count 8 

for bribery involving programs which receive federal funds, in violation of 18 

U.S.C. § 666. This conviction involves the Real Estate Scheme,27 in which he 

and Myles participated in ongoing negotiations regarding the sale and 

development of two properties in St. Gabriel: a 17-lot property which Grace 

owned personally (the “Personal Property”), and a larger, 90-lot property which 

was owned by the City (the “City Property”). Myles first approached with 

overtures about purchasing the City Property. During the course of the 

negotiations, Grace attempted to convince Myles to purchase the Personal 

Property. As an incentive to do so, Grace would give Myles the opportunity to 

purchase and develop the City Property without having to endure the public 

bidding process. Also during the negotiations, Grace offered to funnel money 

from various federal government programs to Myles in exchange for 

purchasing the Personal Property. Grace provided Myles with backdated 

letters which falsely represented the zoning of the properties to help Myles 

secure a $900,000 loan from a bank. Grace also accepted various cash 

payments from Myles throughout this time, and offered to use his influence as 

26 Grace also takes issue with the testimony of FBI Special Agent Tonja Sablatura. Grace 

objected to that part of Sablatura’s testimony which was relevant to Count 8, and the district 

court sustained the objection. Therefore, by the time the case went to the jury, the district 

court had directed the jury to disregard the agent’s testimony as it related to this count, so 

any error was harmless because juries are presumed to follow instructions. See, e.g., Wllogix 

v. Accenture, L.L.P., 716 F.3d 867, 876 (5th Cir. 2013).

27 This scheme pre-dated the Cifer scheme which forms the factual basis for Counts 9, 11, 

and 13.

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Mayor to make Myles a minority owner in a proposed racetrack and casino 

truck stop. Neither project was realized.

Grace argues that Myles’s testimony was improper because it was 

unhelpful to the jury since Grace’s statements were easily understood without 

the aid of additional interpretation. 

Where a party properly objects before the district court, this court 

reviews the admissibility of lay opinion testimony for abuse of discretion.28

To be admissible under Rule 701 of the Federal Rules of Evidence, a lay 

opinion must be rationally based on the perception of the witness and helpful 

to a clear understanding of the witness’ testimony or the determination of a 

fact at issue.29 “[T]he distinction between lay and expert witness testimony is 

that lay testimony ‘results from a process of reasoning familiar in everyday 

life,’ while expert testimony ‘results from a process of reasoning which can be 

mastered only by specialists in the field.’”30 “A lay opinion must be based on 

personal perception, must be one that a normal person would form from those 

perceptions, and must be helpful to the jury.”31

The district court explained why it allowed Myles to testify about his 

understanding of Grace’s statements as follows:

In this case, the jury’s understanding of Grace’s recorded 

statements to Myles would be greatly assisted by Myles’ testimony 

concerning such statements. Grace appears to the Court to be a 

savvy and experienced politician, based on evidence presented so 

far, with a rather savvy and experienced knack for engaging in offthe-record conversations and the use of “sign language.”

28 United States v. El-Mezain, 664 F.3d 467, 511 (5th Cir. 2011).

29 Fed. R. Evid. 701.

30 United States v. Ebron, 683 F.3d 105, 136–37 (5th Cir. 2012) (quoting United States v. 

Yanez Sosa, 513 F.3d 194, 200 (5th Cir. 2008)).

31 Id. (citing United States v. Riddle, 103 F.3d 423, 428 (5th Cir. 1997)).

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While discussing the so-called corrupt transactions, based on the 

evidence presented, Grace appears to be keenly aware of the 

possibility that law enforcement may, in fact, be monitoring his 

conversations. As a result, these purportedly clear statements by 

the defendant, Grace, are anything but clear when put into proper 

context.

Grace appears to have practiced and refined the art of solicitation 

where the words out of his mouth are not always intended to match 

their intended and purportedly clear meaning.

The record supports the district court’s reasons for admitting Myles’s lay 

opinion testimony. Because Grace’s statements “did not always speak for 

themselves,” Myles’s testimony on the true meaning of these statements was 

helpful to the jury’s understanding of this evidence. 32 Moreover, because 

Myles was a participant in the conversations, and he testified to his 

understanding of the communications, his testimony is “rationally based on his 

perceptions.” 33 The district court therefore did not abuse its discretion in 

admitting Myles’s testimony.

32 See United States v. Flores, 63 F.3d 1342, 1359 (5th Cir. 1995). The following is an example 

of Myles’s testimony relating to his recorded conversations with Grace:

Q [to Myles]: All right. On this clip here, when Mayor Grace says, “We can 

talk. We ain’t got that much tricky business to talk about,” then goes on to say, 

“But I’m just letting you know why I say what I say, you know, what do you 

understand him to be telling you here?”

A [From Myles]: Well the only tricky business we got is that he - - he told me 

that, basically, if I wanted to play, if I gave him $170,000, then I got the right 

to do the other thing [the City Property]. That’s the only business Mayor Grace 

and I have at this time that’s tricky business.

But when he says - - and you have to look at the totality of it. He’s just talked 

about wire. He’s just talked about “I don’t talk in the car.” Here you see him 

saying, “I’m just letting you know why I say what I say.”

Mayor Grace is a strong leader, and so you’ll see that he thinks that I’m naïve, 

he thinks I’m green, and so he’s letting me know why he say certain things. 

Because you’ll see later on he may say one - - he may preach one thing, but he 

don’t practice it. So he’s kind of letting me know how he operates.

33 United States v. Parsee, 178 F.3d 374, 379–80 (5th Cir. 1999) (citing Flores, 63 F.3d at 

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d. Grace’s conviction in Count 1

Finally, Grace contends that reversal of his conviction in Counts 8, 9, 11, 

and 13 requires that his RICO conviction in Count 1 be reversed because the 

jury would not have found him to have committed multiple Racketeering Acts. 

This argument hinges upon our reversal of Grace’s convictions in the other 

Counts. Because we affirm those convictions, this argument fails. 

III.

For his last issue, Grace challenges the sentence imposed by the district 

court, claiming it erred in calculating the amount of loss for the EPA and 

Private Investor Letters at $3 million each. In support of this argument, Grace 

points to an almost identical case from this court, United States v. Nelson.34

Nelson involved a related FBI undercover operation to the operation in

Grace’s case. This court vacated the defendant’s sentence because of an error 

in the intended loss calculation for the drafting of two letters of support, one to 

the EPA and one to private investors.35 These letters are almost identical to 

the EPA and Private Investor Letters in the instant case. Based on Nelson’s 

belief that the letter would “assist the Cifer folks” in obtaining grants, the 

district court in Nelson valued the intended loss of the EPA letter at $4 million 

and the private investor letter at $2 million. On appeal, this court determined 

that those calculations were incorrect. As to the EPA letter, the court found 

there was “insufficient evidence to adequately differentiate between legitimate 

funding Cifer could have received from the EPA, and any benefits that Nelson 

intended to stem from this false statement in his letter that he had met with 

1342).

34 732 F.3d 504 (5th Cir. 2013).

35 Id. at 521–24.

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other mayors regarding Cifer and similar projects.” 36 The court in Nelson 

concluded that this was a case “in which the amount of loss cannot reasonably 

be determined, and it may therefore be more appropriate to use ‘the gain that 

resulted from the offense as an alternative measure of loss.’” 37 The court 

posited that the “most appropriate valuation of the EPA letter may be the 

amount Nelson received for writing it,”38 which was $10,000. The court also 

vacated the district court’s intended loss calculation of $2 million for the 

private investor letter based on similar reasons.39

The district court’s intended loss calculation in Grace’s case contains

similar flaws. For the EPA Letter, the intended loss calculation of $3 million

is based on a statement by an FBI Agent to Grace that he was “gonna get . . . 

3 to 4 million dollars per city” in grants as a result of the Letter. Just as in 

Nelson, the Letter was not a grant application and did not specify a requested 

grant amount. Grace was paid $1,000 to draft the EPA Letter. For the Private 

Investor Letter, the intended loss calculation of $3 million was based on an 

agent’s statement to Grace that the Letter would be used to raise $2–3 million 

in capital. Again, the Letter did not specify a requested amount. Grace was 

paid $8,000 in exchange for providing the Letter.

Thus, we vacate the district court’s sentence and remand to the district 

court for a recalculation of the appropriate loss amount.

36 Id. at 522.

37 Id. (citing U.S. SENTENCING GUIDELINES § 2B1.1, cmt. 3(B)).

38 Id. at 522–23.

39 Id. at 524 (“Because we have concluded that a loss recalculation for the EPA letter is 

appropriate on remand, and because the district court’s reasoning with regard to the private 

investor letter relied in part on Nelson’s general expectation to generate ‘a large sum of 

money,’ we deem that closer scrutiny is advisable regarding the valuation of the private 

investor letter.”).

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IV. 

For the foregoing reasons, we AFFIRM the conviction, but VACATE the 

sentence and REMAND this case for resentencing in light of this opinion.

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