Pur s uant to5 T H C IR . R. 47. 5, th e co urt h as det erm in e d th at thi sop inio nsho ul dnotbe * p ubli shedandisnot precedent exc ep t underthe lim it edcircumstanc ess et f orth in 5 T H C IR . R. 47. 5. 4. 

### REVISED March 2 4, 20 11 IN THE UNITED STATE S C OURT OF AP P EALS

F ORT HE F IF T H CIRCUI T

N o. 09- 10905 Su m m ar y Cal endar

UN I TE D S TA TE S OF AM ERI CA, P l ai n t i f f

- A pp el l ee

v. RO Y D AV I D W I LLI AM S, D e fe nda nt

- Appe l l ant

A pp ealf

rom t h e U n i t ed S t ates D i st ri ctC ou rt f ort he N or t her n D i st r i c tof Texas U S D C N o . 2 :09 -C R -3 3 -1

B ef ore D AV IS, W IE N E R , an d D E N N IS, C i rcui tJu dg es. P E R C U R I A M: * Aj u r yf o u n dR o yD a v i dWi l l i a m s g ui l t yo n 2 9 c o u n t s s t e mmi n gf r o m a sch em e to d efrau d t h e D ep a rtm en t of E n erg y b y o ve rb i l l i n g o n e of i ts
c ont r ac t or s, B & W Pante x ( Pan t ex) , f orw or k per f

or m ed byW i l l i am s’ s c om pany, W AA T T S , I n c. (W AA T T S ) , at a n u cl ear faci l i t y operated by P an t ex an d f u n ded byt he D e pa r t m e nto f Ener gy . Sp e c i f

i c ally , W i l l i am s w as c o nvi c t e d o f w i r e f r aud , U nite d S ta te s C ou rt o f Ap pe a ls

Fifth C irc uit 

## F I L E D October 6, 2010 Lyl e W . Cayce C lerkN o. 09- 10905

2 pr o duc i ng fal s e i nvo i c e s b i l l i ng Pant e x f o runj us t i f

i e d p e rd iem s w i t h t he p u rpose of

def rau di n g t h e U n i t ed S t ates , p r e s e n t i n g fa l s e t i m e s h eet s t o a U ni t ed St at es agenc y, and r ec eivi ng publ i c m oney know i ng i tw as ob t ai ned by f rau d. H e w as sentenced t o a t ot al of 30 m on t h s of i m pri sonm en t , t o be f ol l ow ed b yato ta l o f 5 y e a r s o f s u p e r v is e dre le a s e , a n do r d e r e dto p a y $ 1 6 8 , 8 4 8 in
r e s t i t ut i o n. W i l l i am s’ s defen se in t h e di st ri ctcourt , an d h i s pri m ary contenti on on ap pe al , w as t hatt he t hr e e c o nt r ac t s b e t w e e n Pant e x and W AA TTS w e r e “ f i xe dpri c e” c ont r ac t s, w hi c h he ar gued m eantt hatW AA TT S w as ent i t l ed t o r ec eive progress paym en t s based on t h e percent of t h e proj ect s W AA T T S ha d com pl et ed and , o nc e t he w o r k was c o m pl e t e , i tw as e nt i t l e d t o t he f ull a m o u nto f

t he contractpri ce. Th u s, i n W i l l i am s’ s vi ew , even i f he provi ded P an t ex w i t h fal se i nvoi c es and t i m e s heet s, he w as notgui l t y be c ause he r ec eived onl y w hathe w as e n tit le dto u n d e rth e co n tr a c ts
. W illia m s fir s t a r g u e s , a s h e d idin th e d is tr ic t c o u r t , t h a t t h e d is p u te in t hi s c as e a m o unt s t o adi s ag r e e m e ntb e t w e e n W AA TTS and Pantex o ve rt he t e r ms o f

t h e i rc o n t r a c t s , t h a tt h e c o n t r a c t s w e r e n o tfe d e r a lp r o c u r e me nt
c o nt r acts , a nd t hus t hatt he fe de r alc o ur t s l ac k j ur i s di c t i o n. H o w e ve r , t he G overnm en tdi d n ot al l ege t h at W i l l i am s i s l i able t o i t u n der a t h eory of contr act l aw . Rathe r , t hi s i s a c r i m i nal pro c ee di ng al l egi ng vi ol at i ons of fede r alc r i m i nal
s t a tu te s. Fe de r aldi s t r i c tc o ur t s ha ve j ur i s di c t i o n o ve ra l lc as e s i n whi c h a d e fe n d a n t is c h a r g e d w ith a fe d e r a l o ffe n s e . 1 8 U .S .C . § 3 2 3 1 ; Uni t e d S t at e s v. C lark , 5 7 7 F .3 d2 7 3 , 2 8 1 (5 th C ir .), cer tden i ed , 1 30 S. C t. 8 09 ( 20 09 )

. To t he
e x te n t t h a t W illia m s a r g u e s th a t t h e in d ic tm e n t w a s in s u ffic ie n t b e c a u s e it d id
n ot a ll ege t h at W AA T T S ha d a con t ractw i t h t h e governm en t , he st i l lcann ot
s uc c e e d b e c aus e t he e xi s t e nc e o f ag o ve r nm e ntc o nt r ac t i s no t an e l e m e nto f a ny
o f th e o ffe n s e s th a t h e w a s ch a r g e dw ith

. S ee 18 U

. S. C

. §§ 287, 494, 641, 1343. W i l l i a m s a l so ch a l l en ge s th e d i stri ct cou rt’ s fa i l u re to g ra n t his req u est to i n stru ct t h e j u rytha t t h e con tracts w ere f i xe d -price con tracts a n d i ts d ecisi on toN o. 09- 10905

3 al l ow a Pant ex em pl oye e t o t es t i f y as t o t he c ont r ac t s’ m eani ng, c ont endi ng t hat
c ons t r uct i on o f

t he unam bi guous c ont r ac t s w as a ques t i on of l aw f ort he j udge t o determ i n e. A s f

or t h e j u ry i n st ructi on , W i l l i am s m u st show t h at t h ere w as a
s uf f i c i e nte vi de nt i ar y f

o unda t i o n f

o rhi s p ro p o s e d i ns t r uc t i o n a nd t hatt he d is tr ic t c o u r t a b u s e dits d is c r e tio n in re fu s in gto g iv e it. S e e Un ited St at e s v. R e agan , 596 F

. 3d 251 , 255 ( 5th C i r. 201 0)

. W i l l i am s c an n otpre v ai l , how ever, becau se he can n otsurm ou n tt h e f i rsthu rdl e by show i n g t h at t h e contr act s w ere f i xed

- pri ce c on t ract s. W i l l i am s c on t en ds t h at t h e F ederalA cqu i si t i on R eg u l a ti on s, l a i dou t i n the C od e of F ed era l R eg u l a ti on s, ap p l y to th e con tracts betw een P an t ex an d W AA T T S an d requ i re t h at al l govern m en tcontr act s “ m u st fal lw i th i n g tw o m a n d a tedcateg ories”— fixe d -price con tracts or co str e im b u r s e m e n t c o n tr a c ts
. S ee 48 C. F. R. § § 1 6. 10 1(b) , 1 6. 20 1. H o w e ve r , he si m pl y presum es t h at t h e contr act s are g o v erned by the F ederalA cqu i si t i on Reg ul at i o ns w i t ho utpr e s e nt i ng anye vi de nc e t hatt he c o nt r ac t s a r e g o ve r nm e nt
a cq u i sit i on con tracts. T o th e con trary , a l l of th e ev i d en ce su p p orts th e op p osite
c o n c l u s i o n . T h e U n ite dS ta te s is n o t a p a r tyto th e co n tr a c ts
. Cf. 4 8 C. F. R. § § 1
. 10 4, 2
. 10 1 ( de f

i ni ng an ac qui s i t i o n t hat i s s ubj e c tt o t he fe de r alr ul e s a nd
as a c o nt r ac tf

ors uppl i es and s ervi c es “by and f ort he use of

t he Feder al G o v e r n m e n t” ). I n d e e d , P a n t e x ’s P r o c u r e m e n t M a n u e l e x p la in s th a t“P a n t e x ’s pr o c ur e m e nt s a r e no tFe de r alpr o c ur e m e nt s , a nd a r e no tdi r e c t l y s ubj e c tt o t he F ed era lA cq u i sit i on R eg u l a ti on s ( F A R ) i n 4 8 C F R

. ” F u rth erm ore , the con tracts
an dt h e docum en t s i n corporat ed i n t o t h e contr act s es t abli sh that Pa n t ex w as not
r e qui re d to p aype r i o di c pr o gr e s s pa ym e nt s b as e d o n t he pe r c e nt ag e o f t he proj ect W AA T T S com pl et ed n or w as i tw as obl i gated to pa y t h e enti re c on t ract pr i c e r e ga r dl e s s o f

t he a m o unto f

t i m e W AA TTS em pl o ye e s w o rk e d. To t he
c o n tr a r y , P a n te xa n dW AA T T S s p e c ific a lly a g r e e d th a t W AA T T S w o u ld b e p a id
on l y f or t h e t i m e t h at it s em pl oyees act u al l y w orked on the proj ect s. A s f or t h e chal l en ged t est i m on y, W i l l i am s argu es t h at, t h ou gh t h e w i t n ess
w as c al l e d t o pr o vi de fac tt e s t i m o ny, he r t e s t i m o ny r e ga r di ng t he na t ur e o f t heN o. 09- 10905

4 c o nt r ac ta m o unt e d t o i m pe r m i s s ibl e e xp e rtt e s t i m o ny ab o uta n i s s ue o f l aw— t he p r o p e rco n s tr u c tio n o f a co n tr a c t. W illia m s o bje c te dto th e te s tim o n ya t t r ia l; t hus , w e r e vi e w t he di s t r i c tc o urt ’ s de c i s i o n t o a l l o w i tf o ra bus e o f

di s c r e t i o n. Uni t e d St at e s v . McMi l lan , 600 F. 3d 434, 456 ( 5t h C i r . 2010)

. The t es t i m ony w as
a d mi s s ib l e . A s a l a y wit n e s s , t h e P a n t e x e mp l o y e e wa s p e r mi t t e d t o pr o vi de op i n i on s ba sed on h er p erso n a lk n ow l ed ge , t h ou gh sh e w a s n ot p erm i tted to
o p in e o n s u bje c ts th a t r e q u ir e dte c h n ic a l o r s p e c ia liz e dk n o w le d g e . S ee F ED
. R. E VID
. 7 0 1 , 7 0 2 ; McMi l lan , 6 0 0 F

. 3 da t4 5 6
. S h e t e s t i f i e dt h a ts h e was
r es ponsibl e f

orm anagi ng t he c ont r ac t s w i t h W AA TT S and so s he had per so nal kno w l e dg e o f

e ac h pa r t y’ s r e s po ns ibi l i t i e s und e rt he m . I n de s c r ibi ng t he contract s and i n voi ci n g proc edu res, she provi ded no exp ertopi n i on t h at r equ i red speci al i zed k n ow l edg e of contr actl aw . Sh e m ere ly e x p l ai n ed h ow t h e parti es operated u n der t h e contr a c tan d tes t i f i ed that t h e contr act s w ere t arget- pri ce con tracts (an dn ot f

i xe d -price con tracts) ba sed on h er k n ow l ed ge of t h e con tracts
a s th e co n t r a c t m a n a g e ra n dh e ro b s e r v a tio n o f th e p a r tie s ’p e r fo r m a n c e . Cf. Un itedS ta tes v. R id d le , 10 3 F

. 3 d 4 2 3 , 4 2 8 -29 (5th C i r. 1 9 9 7 ) (exp l a i n i n g th a t a l ay w i t n esses m ay exp ress opi n i on s t h at r equ i red speci al i zed k n ow l edg e w h ere t he t es t i m ony w as bas ed on per so nalex per i enc e)

. M or eo ver , hert es t i m ony t hat t he c o nt r ac t s w e r e t ar ge t

- pr i c e c o nt r ac t s t hatr e qui r e d Pa nt e x t o pa y o nl y f o rt he
am ountof

t i m e W AA TT S em pl oye es s pentw or ki ng on t he pr oj ec t s w as c o ns i s t e ntw i t h c o nc l us i o ns t hat an o r di nar y pe r s o n c o ul d d r aw f r o m r e vi e w i ng th e co n tr a c ts a n d th e d o c u m e n ts in c o r p o r a te d in to th e m . S ee Uni t e d S t at e s v. Y an ez S osa , 5 1 3 F .3d 1 9 4 , 2 0 0 (5t h C ir. 2 0 0 8 ). F i n a l l y, W i l l i a m s ad va n ces th ree a rg u m en ts th a t a m ou n t to ch a l l en ge s to t he s uf f i c i e nc y o f

t he e vi de nc e us e d t o c o nvi c thi m . Af t e rt r i al , W i l l i am s f

i l e d a t i m el y m ot i on f

orac qui t t al bas ed i n par t on hi s ar gum entt hatt he e vi denc e w as in s u ffic ie n t t o s u p p o r t h is co n v ic tio n . S ee Fed

. R. Cr i m . P

. 2 9 (c)

. I n t he al t e r nat ive , he r e que s t e d ane w t r i al

. T h e di s t r i c tc o ur tde ni e d t he m o t i o n. W i l l i am s, t h u s, ha s preserved hi s s u f f i ci en cy- of

- t h e- evi den ce c h al l en ge f orN o. 09- 10905

5 a p p e lla te re v ie w . Se e Uni t e d St a tes v. Villar e al , 324 F

. 3d 319 , 322 ( 5th C i r. 20 03 )

. Acc o rd in g l y, w e r e vi e w t he i s s ue de no vo , v i e w i ng t he e vi de nc e a nd d ra w i n g a l l rea son a b l e i n feren ces in the l i gh t m ost fav ora b l e to th e v erd i ct, to d e te r m in e w h e th e rara tio n a l tr ie ro f fa c t c o u ldh a v e fo u n d W illia m s g u ilty

. S ee Un i t ed S t ate s v. O l l i son , 5 5 5 F

. 3 d 1 5 2 , 1 5 8 ( 5 t h C i r . 2 0 0 9 )

. W e r e v i e w t he d e c is io n to d e n yan e w tr ia l fo ra b u s e o f d is c r e tio n . S ee Un itedS ta tes v. A rn o ld , 4 1 6 F .3d 3 4 9 , 3 6 0 (5t h C ir. 2 0 0 5 ). W i l l i am s c o nt e nds t hat t he e vi de nc e w as i ns uf f i c i e ntt o c o nvi c thi m o f t he cha rges s t e m m in g f rom hi s s u bm i ssi on of fal se t i m e sheets an d i n voi ces, as s e r t i ng t hathe r e c e ive d no m o r e t hat he w as e nt i t l e d t o unde r t he t e r m s o f t he
c o n tr a c ts a n dth u s th a t a n yfa l s e s ta te m e n ts h e m a d e w e r e im m a te r ia l. W i l l i am s’ s argum en tfai l s because w i t n ess t est i m o n ya n d d ocum en t ary evi den ce e s t a b l i s he dt ha tt he c o nt r a c t s we r e t a r g e t

- p r i c ec o n t r a c t s u nd e rwhi c h W AATTS
w as t o be paid f

or t h e am ou n tof

t i m e i t s em pl oyees w orked pl u s al l ow able per di em s and w as not enti t l ed to pa ym e n t o f t h e contr actpri ce absent proper i nvo i c e s t hatt hi s a m o untha d b e e n e ar ne d. Thus , t he e vi de nc e w as s uf f i c i e nt f o rt h e j ur y t o c o n c l u d e t h a ti n c l a i mi n gu nj u s t i f i e dp e rd i e ms , Wi l l i a ms presented fal se cl ai m s f or pa ym en t , an d i n al t eri n g t i m e sheets, h e fal si f i ed
w r itin g s fo rth e p u r p o s e s o f d e fr a u d in gth e U n ite dS ta te s . N ex t, W i l l i a m s ar gu es th a t t h e G ov ern m en t fa i l ed to l i n k the ev i d en ce to t h e pa rt i cul ar coun t s rel ated t o t w o of t h e contr act s, bu the i s w rong. For each
c o unt , t he G o ve r nm e ntl i s t e d o n t he i ndi c t m e nt t he da t e o f t he o f fe ns e a nd t he
r e l e va nti nvo i ce num be r , a nd a tt r i ali to f fe r e d i nt o e vi de nc e t he i nvo i c e s a nd pr o o f t hatPant e x pa i d th e m . Fore ac h c har ge r e l at e d t o t he pe rdi e m s , t he G overnm e n ts ub m i t t ed evi den ce t h at t h e rel evan ti n voi ces contai n ed cha rges f or unj us t i f i e d p e rdi e m s , a nd f

o re ac h c har ge r e l at e d t o t he f o r ge d t i m e s he e t s , t he G ov ern m en t su b m i tted e vid en ce th a t W i l l i a m s ha da lt e r e de m p loy ee ti m e sh ee ts t h at c orres pon ded t o each i n voi ce orbi l l ed f or hi s ow n t i m e w h en h e w as not
w or ki ng on aut hor i ze d pr oj ec t s. M or eo ver , a c r i m i nali nves t i gat orand s pec i alN o. 09- 10905

6 ag e ntf r o m D e pa r t m e nto f

Ener gya nd aPant e x e m pl o ye e t e s t i f i e d r e g ar di ng
ea ch of th e inv oices, ex p l a i n i n g w h y e a ch w a s f ra u d u l en t. Fi nal l y, W i l l i am s a r gue s t hatt he e vi de nc e w as i ns uf f i c i e nt t o s upp o r tt he j ur y’ s f i ndi ng r e l at i ng t o t h e a m o u n to f t he l o s s , b e c aus e , i n hi s v i e w , t he G ove r nm ent fai l ed t o pr ove t hatone of W AA TT S’ s em pl oye es , M ar k A r m st r ong,
w as notent i t l ed t o pe rdi em s. W AA TT S em pl oye es w ho l ived m or e th an 45
m i l es aw ay f

rom t h e P an t ex faci l i t y w ere en t i t l ed receive a per di em f rom P an t ex f or each da y t h ey w o r k ed at t h e faci l i t y. Th e faci l i t y i s w i t h i n 45 m i l es of A ma r i l l o , T e x a s . T h e e v i d e n c e e s t a b l i s h e dt h a tA r ms t r o n gr e c e iv e dp e rd i e ms ba s e d o n hi s fal s e r e pr e s e nt at i o n t o Pant e x t hat he l ive d i n Le o nar d, Te xa s ; t he in v e s t ig a t io n s h o w e d t h a t h e p r o v id e d w h a t s e e m s t o b e h i s m o t h e r -i n -l a w ’s
a d d res s . Ar m s t r o ng t e s t i f i e d t hathe ha d aho m e i n Am ar i l l o a nd t he D e p a r tm e n t o f E n e r g yin v e s t i g a to rco n fir m e dth a t A r m s tr o n gh a dliv e din Am ar i l l o s i nc e a r o und 19 94
. Tho ugh Ar m s t r o ng al so te stified t hathe ha d a h ou se i n G eorgi a, t h e evi den ce t h at A rm st rong l i ed ab ou thi s add ress com bi n ed
w i t h t he t es t i m ony o f t he i nves t i gat ort hatA r m st r ong l ived i n A m ar i l l o w as
s u f f i c i e n tf o rt h e j u r yt o c o n c l u d e t h a tA r ms t r o n gw a s n o te n t i t l e d t o a p e rd i e m. Ac c o r d i n g l y , t h e j u d g me n to f t h e d i s t r i c tc o u r ti s A F F I RMED.