### IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

No. 11-50482 cons. w/ 11-50484

UNITED STATES OF AMERICA, Plaintiff-Appellee, v. ADRIAN EDWARDO PENA, also known as Adrian Edward Pena, Defendant-Appellant.

Appeals from the United States District Court for the Western District of Texas

Before STEWART, Chief Judge, and SMITH and WIENER, Circuit Judges. CARL E. STEWART, Chief Judge: This case entails two appeals from Defendant-Appellant Adrian Pena’s convictions and sentences for criminal offenses rel ated to the bribery of two public officials to procure a multimi llion dollar construction contract. Pena contends on appeal that the district court violated Federal Rule of Criminal Procedure 11(c)(1) by participating in his plea negotiations. Pena also asserts that the court’s involvement caused his trial attorney, Thomas Stanton, to represent him under an actual conflict of interest which adversely aff ected Stanton’s performance. Based on this alleged conflict of interest, Pena filed a motion to withdraw his guilty pleas, which the court denied. Pena appeals his convictions and sentences, as well as the district court’s denial of his motion to United States Court of Appeals

Fifth Circuit 

### F I L E D June 18, 2013 Lyle W. Cayce ClerkNo. 11-50482 cons. w/ 11-50484

1 In January 2010, Jeffrey C. Stone, Inc., filed suit against SDVO, Nunez, Pena, Pena’s wife, and others, alleging that the defendants breached a teaming contract between Jeffrey Stone and SDVO and committed various acts ofmisrepresentation and fraud in relation to the Arizona project. SDVO, Nunez, and the Penas were represented by local counsel and by Stanton in that proceeding.

2 withdraw his guilty pleas. We VACATE Pena’s guilty pleas and sentences, and REMAND for further proceedings. I. FACTUAL BACKGROUND & PROCEDURAL HISTORY A. The Instant Offenses In 2009, Pena was arrested in El Paso, Texas, and was charged in two separate indictments for conspiracy to c ommit mail fraud, mail fraud, and deprivation ofhonest services ofa publicservant. The charges arose from Pena’s employment with the construction company for which he worked until 2007. Both indictments alleged that Pena paid bribes to El Paso County officials to obtain a multimillion dollar construction contract for that former employer. Stanton represented Pena in both cases. B. Other Proceedings Involving Pena At the same time that Pena was facing these charges, he was working for theconstruction firm ofhisfather-in-lawCarlos Nunez, SDVO Contractors, L.P. (“SDVO”). SDVO was involved in three controversies regarding an Arizona construction project for the Department of Defense (DOD)—two civil lawsuits and one criminal investigation:

1) Jeffrey C. Stone, Inc. v. SDVO 1: a civil matter in Arizona, in which Pena was a named individual defendant; 2) Bank oftheWestv. SDVO Contractors, LP: a civil matter that was proceeding before Judge Montalvo, where Stanton represented SDVO; andNo. 11-50482 cons. w/ 11-50484

3 3) A criminal investigation into the Arizona project that potentially implicated Pena and several of Stanton’s civil SDVO clients.

The litigation surrounding the Arizona project arose from the DOD’s

erroneous transfer offunds into SDVO’s bank account and SDVO’s subsequent withdrawal ofmost ofthose funds. Specifically, in April 2010, the United States Property and Fiscal Officer for the Arizona National Guard (USPFO) issued a termination-for-default notice to SDVO, ending the contract for the Arizona project. As a result of this termination, the USPFO demanded that the surety perform its obligation under the performance bond. In June 2010, however, the U SPFO inadvertently wired a $733,720 payment for the project into SDVO’s account at the Bank oftheWest (“the Bank”), not into the surety’s bank account. When the surety and the USPFO realized the error and contacted the Bank to

reverse the transaction or freeze the funds, the Bank advised that the funds had already been disbursed in their entirety, with the exception ofan IRS levy placed

on the account in the amount ofapproximately $159,000

. I n July 2010, the Bank filed a state interpleader action for the $159,000, naming as defendants SDVO, the IRS, and the DOD. After this interpleader action was removed to federal court, Stanton appeared as counsel for SDVO. The criminal investigation relating to the Arizona construction project involved SDVO’s alleged misappropriation of these same funds. C. Pre-trial Proceedings for the Instant Offenses In July 2010, an Assistant United States Attorney (“AUSA”) inf ormed Stanton of an ongoing Arizona criminal investigation into SDVO. The AUSA notified Stanton that, because of that investigation, Stanton might have a conflict of interest i n representing SDVO and Nunez in any criminal matters because of Stanton’s representation of Pena in the instant proceedings. InNo. 11-50482 cons. w/ 11-50484

4 response to this information, Stanton affiliated separate c riminal defense counsel for SDVO and Nunez. During this same time, the government also filed a notice of its intention to use evidence of other crimes, wrongs, or acts for the instant proceedings, pursuant to Rule 404(b) of the Federal Rules o f Evidence. Specifically, the government sought to adduce evidence that, in January 2010, Pena contacted a subcontrac

tor on the Arizona project on behalf of SDVO to discuss a possible kickback of contract funds. In August 2010, a pretrial services officer sent the district court a memorandum advising that a recent FBI report contained allegations that, while out on bond, Pena had misappropriated the funds inadvertently deposited into the SDVO bank account. The court however took no action adverse to Pena as a result of this report. D. Plea Negotiations and the Court’s Reference to the “SDVO Matter” On December 1, 2010, the district court held a chambers conference with the attorneys, which the court neither recorded nor transcribed. At that conference, Stanton told the district court that Pena and the government were engaged in plea negotiationsand that Stanton expected those negotiations would be successful. The district court’s response to this information is the focal point of this appeal. There are three different versions of the district court’s response. First, Stanton’s filing on the same day as the chambers conference suggests that the court said it wanted Pena to resolve the SDVO matter before the court would accept Pena’s plea. According to Stanton, the court told him that it had received information that money related to SDVO had been “missing and misapplied.” Second, the government recalls the district court saying that it would give Pena full credit for acceptance of responsibility if he resolved the SDVO matter concurrently with his guilty plea to the instant offenses. Third, at a hearing inNo. 11-50482 cons. w/ 11-50484

5 May 2011, the district court stated on the record that it recalled saying that the SDVO matter should be “resolved concurrently with the resolution ofthis case.” Likewise, the district court’s order following the hearing states: “At the conference the Court mentioned [the SDVO interpleader action] and stated its opinion that the civil case should be resolved by the time ofthe plea hearing [for the instant offenses].” Following the court’s statements, Stanton asked for the opportunity to respond to the allegations, but the court denied this request. E. Stanton’s Conflict-of-Interest Cla i m and Motion to Withdraw as Counsel On the same day as the chambers conference, Stanton notified Pena via email that he (Stanton) might have a non-waivable conflict in representing both Pena and SDVO. Pena responded that he could not allow Stanton, “under any circumstances,” to cease representing him in the SDVO matters. Pena then appears to have told Stanton that he would continue pro se in the instant criminal matters. Pena wrote that he would not sign the plea agreement unless it included the condition the district court had imposed and that he would request that the prosecutor enforce the condition. Later that day, Stanton filed a motion under seal notifying the district court of his conflict of interest and asking the court to vacate the trial date and permit him to withdraw from Pena’s case. Stanton reminded the court that he represented SDVO in the interpleader action regarding the same monies the court mentioned in chambers, which was pending in the samejudge’s court. In addition, the J effrey Stone case was pending in Arizona, and that case also “involve[d] theconstruction project made the basis of the Government’s payment to SDVO.” Although Stanton had obtained separate counsel to represent SDVO and Nunez, he “continue[d] to be one of three lawyers representing SDVO in several [civil] matters.” Stanton reasoned that, because he continued toNo. 11-50482 cons. w/ 11-50484

2 A minute entry on the docket reflects that the court denied Stanton’s motion to withdraw on December 3, 2010. However, the court’s sealed order dated May 18, 2011 notes that “the electronic file notation denying Stanton’s Motion to Withdraw . . . was not entered until May 11, 2011”–five months after Pena pleaded guilty. 6 represent SDVO and because the district court had ordered that the SDVO matter pending before it be resolved bef ore it would accept Pena’s plea agreement, Stanton was ethically required to: 1) notify Nunez, SDVO, and Pena ofhis conflict of interest; 2) inform Nunez that he could not waive the conflict as it affected Pena; 3) withdraw from the SDVO litigation; and 4) withdraw from representing Pena. Stanton stated that, although he could not disclose the full extent of the conflict, he could not recommend that Pena accept terms that Stanton could not accomplish ethically and that were unenforceable. Stanton also told the district court that, in response to the chambers conference, Pena had directed him to remain as his counsel in the SDVO litigation, but that Stanton believed this request was against both Pena’s and Stanton’s interests. Stanton asked the court to: 1) vacate the trial date; 2) recuse itself or reassign the case; 3) permit Stanton to withdraw; 4) accept the plea based on the terms the parties had discussed prior to the chambers conference; and 5) not factor in the SDVO litigation for any sentencing matters. The districtjudge’s law clerk phoned the parties the next day, December 2, 2010. The law clerk told the parties that the court had changed its mind about the need to resolve the SDVO matter before the court would accept Pena’s plea and that the parties were to “disregard” its statement. 2 F. Plea Agreements and Guilty Plea Hearing Four days later, on December 6, 2010, Pena signed plea agreements in both cases, admitting to the conspiracy charges in the first count of each indictment. The government agreed to ask that Pena not be sentenced until heNo. 11-50482 cons. w/ 11-50484

3 Pena later attached these letters as exhibits to his pro se motion to continue the sentencing and replace counsel, which he filed on April 15, 2011. 7 had been fully debriefed so that the government might request a lower sentence under U.S.S.G. § 5K1.1 for substantial assistance. During the hearing, the district court followed the standard plea colloquy procedure under Rule 11. The court was also especially concerned about Pena’s “duty of financial candor,” which was a condition of his plea agreement:

THE COURT: Mr. Pena, before I preliminarily accept your guilty plea, I need to direct your attention to the duty of financial candor section contained in both plea agreements in both of these cases. . . . I am going to instruct my probation officer within ten days oftoday to set up a meeting with you in which you are going to disclose the totality ofyour financial dealings, whohave you given money to recently, say in the last year, that is out o

f the ordinary. Anything that that [sic] probation officer asks you about your finances, you are going to answer. Pena confirmed his understanding of these terms. The court subsequently accepted Pena’s guilty pleas and set sentencing for April 20, 2011. G. Pena’s Pro Se Activity Related to His Debriefings and Sentencing Prior to Pena’ssentencing, heengaged in significant proseactivity related to his debriefings with the government and his upcoming sentencing. For example, Pena, pro se , sent various communications to the probation off icer, including: 3

• In a letter to the probation officer dated February 2, 2011, Pena lodged legal challenges to the factual basis for his plea, arguing, inter alia, that the facts did not match the indictment.

• In a February 11, 2011 letter to the probation officer, Pena expressed frustration that he had been unable to fully comply with his plea. He pointed to the pleaNo. 11-50482 cons. w/ 11-50484

8 agreement’s “duty of financial candor” section to illustrate that he was attempting to comply with the district court’s demand that he resolve the SDVO matter. He wrote that he had insisted “the court’s request to ‘resolve the SDVO matter’.

. . prior to having plead [sic], but my attorney and the AUSA ref used to include the resolving of the SDVO matter in my plea.” Pena also referred to hi s debriefings, his duty of financial candor in his plea agreement, and the court’s request to resolve the SDVO matter, writing, “I WANT TO CONTINUE TO COMPLY!”

• On Marc

h 14, 2011, Pena submitted “Self-Provided Presentencing Supporting Information” to assist the probation officer with composing his presentence investigation report (“PSR”).

• Also on March 14, Pena wrote to the probation officer: “For the Record, I have provided ‘Substantial Assistance,’ but unfortunately without Counsel. I do not and never wish to have or be represented especially during any debriefings. In respecting the Court’s Demand to resolve certain matters, I have been without counsel and do not wish to ever waive this right.”

In virtually all ofhis prosecommunications, Pena indicated that hewaswithout counsel and requested assistance from the probation officer. H. Pena’s Pro Se Conflict and Judicial Participation Claims, and Pena’s Request to Withdraw His Plea On April 15, 2011, Pena, pro se , filed a motion to continue sentencing and replace counsel, to which he attached copies of the above-referenced communications, in addition toothers. In the documents, Pena asserted that the PSR that the probation officer had recently filed evidenced an ongoing conflict between Pena and Stanton. The PSR listed the SDVO matter under “Pending Charges.” The PSR also contained information that some of the SDVO monies had been transferred to Stanton’s Interest on Lawyer’s Trust AccountNo. 11-50482 cons. w/ 11-50484

4 If a lawyer holds any funds which do not belong to the lawyer, then those funds must be held in a separate account designated as “trust” or “escrow,” which is the purpose of the IOLTA. See Tex. Disciplinary R. Prof’l Conduct 1.14(a). 9 (“IOLTA”). 4 Pena explained that these funds were the source of Stanton’s conflict of interest, both because Stanton was operating under a duty to protect the funds on behalfofSDVO in the civil suit and because there was an ongoing criminal investigation into these same funds which potentially implicated Stanton and his SDVO civil clients. Pena also pointed out that he had already begun extensive debriefings with the government in the hope offavorable treatment at sentencing, but that Stanton was not present at about 80 percent of those debriefings. According to Pena, Stanton did not attend the debriefings “due to the conflict with the court requested SDVO resolution.” He wrote: “Defendant’s Counsel cannot fight, rebut[ ] and/or respond tothe prosecution [to reap the benefits [of] the 5K section and substantial assistance section] because of the inability to explain in detail to the court all of the information provided to the prosecution about SDVO by defendant.” In one of the attachments, Pena stated that Stanton “cannot effectively represent me when discussions ONLY about my old employer SDVO are taking place.” In its response to Pena’s motion, the government stated its beliefthat the fact that Pena continued with plea negotiations after the court withdrew the SDVO condition suggested that no harm had been done. The government maintained that the district court was under no obligation to investigate Stanton’s and Pena’s claims that Stanton was conflicted in the case because Pena had pointed to no actual conflict. According to the government, Stanton’s representation of SDVO did not render him conflicted in the matter of Pena’s debriefings because the government, not defense counsel, decides whether a defendant has debriefed truthfully and fully.No. 11-50482 cons. w/ 11-50484

10 In his reply to this motion, Pena requested to withdraw his guilty plea because he had pled on the advice of conflicted counsel. In this filing, he twice referred to the district c ourt’s “inserting itself into plea negotiations” as the

cause ofthe conflict. He wrote: “The court was knowingly aware of the potential conflict by motion, within 13 hours of defendant’s counsel’s known awareness that therewas in fact a potential conflict made by the court inserting itselfin the plea negotiations of December 1, 2010 and making its knowledge of the conflict known.” He also wrote: “On December 1, 2010 defendant’s counsel was made

aware of the potential conflict by which the court inserted itself in the plea negotiations at the Chamber’s Conference held.” The government responded separately to Pena’s request to withdraw his pleas, arguing that, at the plea colloquy, Pena said he was pleading knowingly and voluntarily and that he was satisfied with his counsel: The government indicated its beliefthat the court had complied with Rule 11 during the colloquy. The government also noted that Pena had not asserted that he was not guilty of the charges. I. Stanton’s Post-plea Conflict Claims In Stanton’s separate filing on April 18, 2011, he renewed his request to withdraw as counsel. He stated: “I agree [with Pena] that I have a conflict consistentwith my representations to the Court under seal on December 1, 2010. However, until the Court makes a determination, I am ethically bound tofile on behalfofMr. Pena objections” tothe PSR. Stanton wrote that he was proceeding

even though, on the same day as his filing, Pena “reaffirmed to [Stanton] to not proceed in his defense because of the conflict of interest . . . that he has not waived.” Stanton objected, inter alia, to the PSR’s inclusion of matters regarding the disputed SDVO monies and inaccuracies relating to this information.No. 11-50482 cons. w/ 11-50484

5 On that same day, the docket was amended to reflect that the district court had denied the first motion to withdraw on December 3, 2010. 11 Stanton told the court that the paragraphs alleging that Pena had misappropriated funds raise a conflict of interest because Stanton represented SDVO and Carlos Nunez in civil matters di rectly related to these matters. SDVO had waived a conflict ofStanton’s representation of Pena only “so long as the representation does not bar [Stanton] from proceeding i n the defense of SDVO and Nunez on the civil matters.” Stanton also stated that he had “proceeded in representation on the two guilty pleas in reliance on the Court’s statement to disregard the matters the Court raised sua sponte relating to SDVO.” He asked the court to strike the paragraphs relating to SDVO, “consistent with the Court’s statement to [Stanton] to disregard its earl ier requirement that the SDVO matters be resolved.” J. Hearing on Pending Motions to Withdraw Counsel and to Withdraw Guilty Plea The district court held a hearing on May 11, 2011. 5 The court said that, in its view, it had mooted Stanton’s post-conference conflict claim when it notified the parties that it was withdrawing its requirement that the SDVO litigation be resolved before it accepted Pena’s plea. It noted that Pena had pleaded guilty and ordered the probation officer to prepare an amended PSR to

remove references to the SDVO “because, frankly, it is erroneously referred to as a pending charge, and it is not.” Pena represented himself at this heari ng, although Stanton was also present. Pena told the district court that Stanton’s conflict arose from the criminal investigation into SDVO. He said that, based on his debriefings with the government, he understood that the investigation was continuing and that he was a target. The subject matter of the investigation, Pena pointed out, wasNo. 11-50482 cons. w/ 11-50484

12 missing funds, “the funds that [had] been deposited into [Stanton’s] trust.” Pena told the court that Stanton “could have possibly been working under the loyalty of protecting the funds, the funds that belong to an employer, or protecting the company.” When offered an opportunity to speak, Stanton stated: Your honor, my ethical requirements are to not take a position inconsistent with my client. The Court has before it my notice to the Court in response to his motion to withdraw. The Court directed me to remain his counsel. I am doing so. And I have nothing further to add today. The district c

ourt advised Pena that it would not consider anything relating to the SDVO civil case or any pending criminal investigation in determining Pena’s sentence. The district court confirmed that, after Stanton filed his December 1, 2010motion towithdraw, he received notification, through the judge’s law clerk, that thejudge would not consider the SDVO matter with respect to Pena’s guil ty pleas. The district court described the conflict as an “obscurely described potential conflict having to do with an investigation out there.” It stated that it would not factor in the investigation at sentencing. At the end ofthe hearing, the district court, sua sponte , revoked Pena’s bond in the beliefthat Pena’s prosemotions evidenced hisfailure toaccept responsibility for his actions. The district court denied Pena’s pro se motions in a subsequent sealed order on May 18, 2011. This order reflected the court’s oral statements at the hearing that it did not believe Pena had pointed to an actual conflict. The court alsocharacterized any conflict stemming from the government’s intent to use the Rule 404(b) evidence as “hypothetical.” In relevant part, the order stated:

Pena appears to conflate three distinct SDVO matters. Bank of West v. SDVO Contractors

. . . is a civil case currently pending before this Court. The CourtNo. 11-50482 cons. w/ 11-50484

13 conducted an in-chambers conference with both parties on December 1, 2010. At the conference the Court mentioned this civil case and stated its opinion that the civil case should be resolved by the time of the plea hearing. After further deliberation, the Court decided the civil case was proceeding in a timely manner and there was no reason to impose such a requirement.

. . . The third SDVO matter is an apparent criminal investigation in Arizona. The Court gleaned information about the third SDVO matter from the United States Pretrial Services

. . . On August 3, 2010, Pretrial Services sent a Memorandum to the Court reporting a possible bond violation by Pena. . . . The information related to conduct of Pena in connection to SDVO.

The district court concluded: “Pena does not identify howsimultaneously representing SDVO in a civil matter and Pena in the above-captioned criminal

cases present a conflict.” The court also concluded that Pena’s plea colloquy demonstrated that his pleas were knowing and voluntary, and that he was satisfied with his counsel’s representation. The court then denied Pena’s motions requesting to replace counsel and to withdraw his guilty pleas. K. Sentencing At the sentencing hearing, the court first established that Pena did not have Stanton or other counsel present with him at the PSR interview. The court then sentenced Pena to a total of 76 months of imprisonment, consisting of two 63-month terms, with 13 months in one case to be served consecutively to the

sentence imposed in the other. The court also ordered that Pena serve concurrent three-year terms of supervised release and fined him $125,000 in each case (for a total fine of $250,000). Pena timely appealed both ofhisconvictionsand sentences. These appeals have been consolidated for our consideration.No. 11-50482 cons. w/ 11-50484

6 Westlaw and Lexis have designated U nited States v. Adams as “superseded” by statute or regulation based on the reasoning ofnon-Fifth Circuit cases that Adamswasdecided prior to the enactment ofthe U.S. Sentencing Guidelines. However, we have relied on Adams in full, including its remedy, as recently as 2010. See United States v. Self , 596 F.3d 245, 250 (5th Cir. 2010) (relying on Adams to vacate the defendant’s conviction and sentenc e and to reassign to a different judge on remand following the district court’s participation in plea negotiations). Thus, while these sources categorize Adams as no longer good law in part, this designation is incorrect. 14 II. DISCUSSION A. Judicial Participation in Plea Negotiations 1. Applicable Law Rule 11 allows a district court to accept or reject a plea agreement. Fed. R. Crim. P. 11(c)(4) - (5). Further, “a court must be free, in certain respects, to take an ‘active role’ once the agreement is disclosed.” U nited Statesv. Miles, 10 F.3d 1135, 1140 (5th Cir. 1993) (citation omitted). In fact, the rule mandates this scrutiny. See id. (citations omitted). Rule 11 also requires that the district court “address the defendant personally in open court and determine that the plea is voluntary and did not result from force, threats, or promises (other than promises in a plea agreement),” and “determine that there is a factual basis for the plea.” Fed. R. Crim. P. 11(b)(2), (b)(3). However, Rule 11 prohibits thesentencing court from participating in plea negotiations: “An attorney for the government and the defendant’s attorney, or the defendant when proceeding prose, may discuss and reach a plea agreement. The court must not participate in these discussions.” Fed. R. Crim. P

. 1 1(c) (emphasis added). We have characterized Rule 11’s prohibition of judicial involvement asa “bright line rule,” United Statesv. Rodriguez, 197 F.3d 156, 158 (5th Cir. 1999), and “an absolute prohibition on all forms ofjudicial participation in or interference with the plea negotiation process,” U nited States v. Adams, 634 F.2d 830, 835 (5th Cir. Unit A Jan. 1981). 6 Thus, while the rule “requires that a district court explore a plea agreement once disclosed in open court[,]

. . .No. 11-50482 cons. w/ 11-50484

15 it does not license discussion of a hypothetical agreement that it may prefer.” Miles, 10 F.3d at 1140 (citation omitted). We have recognized this bright line rule for several reasons. First, “it

serves to diminish the possibility ofjudicial coercion ofa guilty plea, regardless ofwhether the coercion would cause an involuntary, unconstitutional plea.” I d. at 1139 (citations omitted). Indeed, “pressure is inherent in any involvement by

a judge in the plea negotiation process.” Rodri guez, 197 F.3d at 159. Second, “such involvement ‘is likely to impair the trial court’s impartiality. The judge who suggests or encourages a particular plea bargain may feel a personal stake in the agreement

. . . and may therefore resent the defendant who rejects his advice.’” Miles, 10 F.3d at 1139 (omission in original) (citations omitted). Third,

a judge’s “participation in plea discussions creates a misleading impression of thejudge’s role in the proceedings. As a result of his participation, the judge is

no longer a judicial officer or a neutral arbiter.” I d. (citations and internal quotation marks omitted). Rather, the judge “becomes or seems to become an advocate for the resolution he hassuggested tothedefendant.” I d. (citations and internal quotation marks omitted). 2. The Parties’ Arguments Pena alleges that the district court violated Rule 11 when it participated in plea negotiations by stating that Pena should resolve the “SDVO matter” before the court would accept his guilty plea for the instant offenses. Pena argues that the court improperly proposed a “hypothetical agreement,” as it “attempted to resolve a pending civil matter and possible criminal allegations against Pena by conditioning ac c eptance of Pena’s plea on resolution of those matters.” Thegovernment maintains that thedistrict court’s comments “did not rise to the level of participation,” as they “are best characterized as an off-the-cuffNo. 11-50482 cons. w/ 11-50484

16 attempt toshape the administrative conditions under which it would accept the plea itself, and not an injection into the discussion of the terms of the agreement.” 3. Discussion Given the sanctity ofRule 11’s absolute prohibition on any form ofjudicial involvement in plea negotiations, we conclude that, albeit unintentionally, the district court here stepped over the line and violated Rule 11 when it suggested that Pena must resolve the SDVO matter before the court would accept Pena’s plea in the instant offenses. See Crowell , 60 F.3d at 203 (citing Miles, 10 F.3d at 1139-40) (“When a court goes beyond providing reasons for rejecting the agreement presented and comments on the hypothetical agreements it would or would not accept, it crosses over the line established by Rule 11 and becomes involved in the negotiations.”)). As noted, Pena and the government present different accounts of exactly what the district court said during the off-the-record chambers conference, in addition to the court’s own assertion of what it said. Pena asserts that the district court said that it would not accept a plea unless Pena first resolved the SDVO matter by returning monies that the district court believed Pena had misappropriated. The government asserts that the district court said it would give Pena full credit for acceptance of responsibility if he resolved the SDVO matter concurrently with his plea in the instant proceedings. The government also maintains that the specificSDVO matter that the court referred towas the interpleader action, which was also pending before the district court. The district court likewisesuggested at both the hearing and in its order in May 2011 that it told Pena that he should resolve the civil interpleader action prior to pleading guilty tothe instant offenses. Regardless, we agree with Pena that anyNo. 11-50482 cons. w/ 11-50484

17 version constitutes participation in plea negotiations in violation of Rule 11, for several reasons. First, the district court’s statements connote the possibility that the court had already made a determination as to Pena’s guilt in the instant offenses and preferred a guilty plea. See Rodriguez, 197 F.3d at 160 (“The clear implication of the judge’s statements at the pretrial hearing was that the judge desired a plea.”); Miles, 10 F.3d at 1141 (“By trying to facilitate a plea bargain, thejudge indicated that he desired an agreement; this is pressure enough.” (quoting United States v. Barrett, 982 F.2d 193, 196 (6th Cir. 1992))). In particular, both thegovernment’sand thedistrict court’sversions of the court’s statements would constitute the court’s own plea bargain. SeeAdams, 634 F.2d at 836 (concluding that the district court participated in plea negotiations when “thejudge offered

a plea bargain to [the defendant] on her own initiative”). The district court’s statements also implied that Pena was liable for wrongdoing, i .e., misappropriating funds, in an unrelated matter. Second, the f

act that the court made the statements while plea negotiations between Pena and the government were ongoing is crucial: We have noted the distinction between a sentencing court’s comments before the parties have disclosed the terms to the court and the court’s statements after this time. See Crowell , 60 F.3d at 204. For instance, in Crowell , the district court’s comments reflected its “feeling that a penalty significantly more severe than that allowed under the fi rst plea agreement would be necessary for an agreement to be acceptable,” which the court made known to the parties before the second agreement was in final form. Id. at 204. We stated, “the fact that this comment was injected into the discussions while the parties were still preparing the second agreement is critical. It is precisely this type of participation that is prohibited by Rule 11.” Id.No. 11-50482 cons. w/ 11-50484

18 The instant case is similar to United States v. Daigle , i n which we

conc luded that the district court erred by participating in plea negotiations when it engaged in an off-the-record discussion with the parties in chambers regarding the defendant’s guilty plea and sentence. 63 F.3d 346, 347 (5th Cir. 1995). During the chambers conference in Daigle , the district court informed the defendant that, if “he fully cooperated, that 90% of the time [the court] will follow the [sentencing] recommendation of the U.S. Attorney.” Id. at 347, 349. The defendant understood this statement to mean a nine-year “cap” of prison time based on the court’s statements during the subsequent guilty plea hearing. Id. at 348. At that hearing, the court stated: “All right, so if nine years is what y’all agreed upon and that’s the recommendation made to me, and there is substantial cooperation, that’s the cap of nine years, okay?” I d. at 348-49. We concluded that the district court participated in the plea negotiations based on the court’s statement that it follows the government’s sentencing recommendation “90% of the time” if the defendant cooperates. I d. at 349. We noted that thedistrict court’sstatement during the hearing “strongly support[ed] [the defendant’s] contention that he understood the court to be indicating a ‘cap’ of nine years if the government so recommended.” See id. at 348-49. Here, the government’s principal argument against the conclusion that the district court’sstatementsconstituted involvement is that the comments “did not rise to the level of participation.” Rather, insists the government, the statements “are best characterized as an off-the-cuff attempt to shape the administrative conditions under which it would accept the plea itself, and not an injection into the discussion of the terms of the agreement.” Commendably, however, the government alsoconcedes that Pena’s interpretation ofthe district court’s statements is reasonable–that they reflected the court’s insertion of a “condition” into the terms ofhis plea. See, e.g., United Statesv. Ekwerekwu, No.No. 11-50482 cons. w/ 11-50484

19 93-9126, 1995 WL 136519, at *3 (5th Cir. Mar. 17, 1995) (vacating and remanding the defendant’s conviction and sentence after concluding that the district court participated in plea negotiations and noting that we “must appropriately consider Ekwerekwu’s reasonable perception” of the district court’s potential lack of objectivity). It is also noteworthy that the government’s argument on this issue focuses more on the harmlessness of the court’s statements than on whether the statements constituted error under Rule 11 in the first instance. Weconclude that thedistrict court participated in Pena’s plea negotiations in violation of Rule 11. Although the record discloses no basis to conclude that the court’s error was intentional, we neverthel ess must heed Rule 11’s brightline prohibition of all judicial participation in plea negotiations and recognize the district court’s error. See Barrett, 982 F.2d at 196 (“Regardless of the judge’s objectivity, it is the def endant’s perception of the judge that will determine whether the defendant will feel coerced toenter a plea.”) (citation omitted). This

error was plain in light of our well-settled circuit law prohi biting a court’s participation in plea negotiations. B. Effect on Pena’s Substantial Rights While the parties dispute whether harmless error or plain-error review applies in this case, we pretermit a determination ofthis issue. Even assuming arguendothat plain-error reviewapplies, we conclude that we must exercise our discretion to reverse the district court. 1. Applicable Law Under the Federal R ules of Criminal Procedure, “[a] plain error that affects substantial rights may be considered even though it was not brought to the court’s attention.” Fed. R. Crim. P. 52(b); s eeUnited Statesv. Vonn, 535 U.S. 55, 58-59, 62, 74 (2002) (applying plain-error review to unpreserved Rule 11No. 11-50482 cons. w/ 11-50484

20 error, notwithstanding Rule 11’s provision that a variance from the requirements ofthe rule is harmless error ifthe error does not affect substantial rights (citing Fed. R. Crim. P. 11(h))); see also United States v. Davila, No. 12-167, 569 U.S. ___, 2013 U.S. LEXIS 4541, at *24-25 (U.S. June 13, 2013) (reaffirming that plain-error review, rather than automatic vacatur, governs unpreserved Rule 11 error). “To affect the defendant’s substantial rights, the defendant must demonstrate that the error affected the outcome of the district court proceedings.” U nited States v. Broussard, 669 F.3d 537, 553 (5th Cir. 2012) (citations omitted). “[A] defendant who seeks reversal of his conviction after a guilty plea, on the ground that the district court committed plain error under Rule 11, must show a reasonable probability that, but for the error, he would not have entered the plea.” U nited Statesv. Dominguez Benitez, 542 U.S. 74, 83 (2004). Lastly, under the final prong of plain-error review, “[w]e will exercise our discretion to correct plain error if it seriously affected the fairness, integrity, or public reputation of thejudicial proceeding.” B roussard, 669 F.3d at 553 (alteration in original) (citation omitted). 2. The Parties’ Arguments Pena contends that three things are evident from the record: 1) The district court’s condition was inherently coercive and became the focal point of the plea negotiations; 2) that condition created or revealed a conflict of interest between Pena and Stanton; and 3) neither the court’s attempt to withdraw its condition nor Pena’s guilty plea could ameliorate the harm resul ting from the court’s statements. Pena points out that the district court’s request prompted Stanton’s motion to withdraw as counsel because of the conflict. Pena argues that, although Stanton did not specify the complete nature ofthe conflict at that time, he intimated to the district court that he was incapable of disclosing the conflict in full. Subsequent proceedings revealed that Stanton held a portion ofNo. 11-50482 cons. w/ 11-50484

7 The government confirmed during oral argument that it has now indicted several of Stanton’s clients, as well as Pena, for wrongdoing related to the SDVO monies.

8 Alternatively, according to the government, the district court said that it would grant Pena full credit for acceptance ofresponsibility ifhe resolved the SDVO matter before entering his plea. According to the court, it stated that Pena should resolve the civil SDVO matter 21 the disputed SDVO monies in his attorney trust account. Meanwhile, Pena continued to be debriefed by the government regarding these same monies in light of his perception that the court wanted the matter resolved prior to his sentencing and the government’s apparent interest in this information. These debriefings potentially exposed Stanton’s civil SDVO clients to criminal liability. 7 The government argues that, even if the district court erred, Pena cannot show any harm because: 1) Pena had already decided to plead guilty when the court made the statement; 2) Pena’s plea colloquy demonstrates that his plea

was knowing and voluntary; and 3) the court withdrewthe condition relating to resolution of the “SDVO matter” soon after it made its statement to the parties. The government further asserts that theSDVO matter and the instant cases are completely unrelated, and thus any alleged conflict between Pena and Stanton is specious. 3. Discussion The Supreme Court recently emphasized that “[v]acatur of [a] plea is not in order if the record shows no prejudice to [a defendant]’s dec ision to plead guilty.” Davila, 2013 U.S. LEXIS 4541, at *8 (emphasis added). Thus, although the primary focus of our prejudice analysis must be the period between the district court’s participation and Pena’sguilty pleas, our reviewisalso“informed by the entire record.” Dominguez Benitez, 542 U.S. at 83. The district court indicated that it would not accept Pena’s pleas unless Pena also resolved the SDVO matter; that statement amounts to a hypothetical agreement that the court preferred. 8 Just five days later, Pena pled guilty—a temporal proximityNo. 11-50482 cons. w/ 11-50484

before his plea in the instant proceedings. These statements would constitute a plea bargain.

9 Al though the government assessed the impact of the court’s condition under a harmless-error standard, its arguments are still germane to our plain-error analysis. See United States v. Olano, 507 U.S. 725, 734 (1993) (citations omitted) (clarifying that the third prong of plain-error review SS that the error must “affec[t] substantial rights”S S“is the same language employed in [Federal Rule of Criminal Procedure] 52(a) [‘Harmless Error’], and in most cases it means that the error must have been prejudicial: It must have affected the outcome of the district court proceedings.”); see also 28 Moore’s Federal Practice § 652.04[4], at 652-30 to -32 (Daniel R. Coquillette et al. eds., 3d ed. 2013) (citations omitted) (“The Olano Court pointed out that [whether obviouserror ‘affect[s] substantial rights’] isexactly that same standard applied in harmless error review under Rule 52(a)[.]”). 22 that supports a finding of prejudice. See Davila, 2013 U.S. LEXIS 4541, at *26 (contrasting a plea that follows “soon after” judicial participation with a threemonth delay). The government maintains that even if the district court impermissibly participated in Pena’s plea negotiations, that error did not affect Pena’s substantial rights, because he had already decided to plead guilty. 9 As Pena notes, however, plea negotiations were merely ongoing, and the parties had disclosed

no terms to the court. This distinction is crucial, as we have already discussed. See Crowell , 60 F.3d at 204 (citation omitted). Stanton’s motion to withdraw, moreover, asserted that “Defendant Pena continues towish toenter a plea under the terms which were the subject of the general agreeme nt of the parties prior to the declaration of the Court setting out a resolution of the SDVO claims.” That contemporaneous account indicates that there was no definite agreement in advance of the district court’s participation. In Rodriguez, we specifically rejected the government’s argument that, because thedefendant had already negotiated a plea with thegovernment before the district court’s participation in plea negotiations, the court’s error did not impact the proceedings, becausewe knewthe preciseagreement that would have resulted in the case. See Rodriguez, 197 F.3d at 160 n.15. We stated that, byNo. 11-50482 cons. w/ 11-50484

23 making that argument, “thegovernment ignoreswhatwedonot know 

### SS whether [the defendant] would have entered the agreement at all absent the judge’s involvement.” I d. We thus concluded that the district court’s statements pressured the defendant to plead guilty, even though the statements did not alter the termsofthe previously negotiated agreement, because “Rule 11 applies to all forms of participation.” I d

. at 157-59, 160 n.15; see also Miles, 10 F.3d at 1141. Even though thedistrict court told the parties that it waswithdrawing the condition and that they should “disregard” it, the record evidences that the “withdrawal” did not alter Pena’s perception of the court’s desired disposition. Pena still thought that he needed to resolve the SDVO matter to the extent that he could before entering his pleas. As we observed in Rodriguez:

Once the judge placed pressures on Rodriguez, thei r impact could not be so readily alleviated. The clear implication of the judge’s statements at the pretrial hearing was that thejudge desired a plea. It is reasonable to doubt that any amount ofexplanation from Rodriguez’sattorney could havecured the impression likely left in Rodriguez’s mi nd that “refusal to accept the judge’s preferred disposition would be punished.” Rodriguez, 197 F.3d at 160 (citations omitted); see also Miles, 10 F.3d at 1141. The record also suggests that, by imposing and then quickly retracting a unilateral condition, thedistrict court unintenti onally induced Pena—who might have otherwise continued bargaining—to plead guilty quickly, lest the court change its mind again. The pre-plea proceedings before the court, therefore, illustrate one of the core concerns that Rule 11 was intended to combat, i.e., the indeterminateeffectsofthecourt’s involvement in plea negotiations, even ifonly in the defendant’s mind. See Miles, 10 F.3d at 1141 (citing Barrett, 982 F.2d at 194 (“By intervening to facilitate a plea, . . . the judge communicated to theNo. 11-50482 cons. w/ 11-50484

10 Davila ci tes Miles with apparent favor. See Davila, 2013 U.S. LEXIS 4541, at *15 n.2.

11 Again, the district court said to Pena:

I need to direct your attention to the duty of financial candor section contained in both plea agreements in both of these cases

. . . . I am going to instruct my probation officer within ten days oftoday to set up a meeting with you in which you are going to disclose the totality of your financial dealings, who have you given money to recently, say in the last year, that is out of the ordinary. 24 defendant that he desired a plea. He thereby raised the possibility, if only in the de fendant’s mind, that a refusal toaccept thejudge’s preferred disposition would be punished.”)). 10 Subsequent proceedings also illustrate the impact ofthe court’s condition

on Pena’s perception of the terms of his guilty pleas: He persisted in trying to do something about the SDVO matter long after the district court had retracted its plea condition. One of Pena’s pro se filings alleged that he had attempted to include resolution of the SDVO matter in his plea agreements followi ng the court’s withdrawal ofthe condition, but the attorneys did not include that term. F urther, Pena’s communications with the probation officer indicate that Pena interpreted the “duty of financial candor” provision in his plea agreement

### SS which the district court highlighted during the plea hearing

### SSto includecandor with respect to the SDVO matter specifically. The district court’s emphasis on this section of Pena’s plea agreement likely reaffirmed, in Pena’s mind, the court’s desired disposition relating to the SDVO matter, even if that was not the court’s actual intent. 1 1 See Adams, 634 F.2d at 841 (citation omitted). Pena’s decision to proceed without counsel during most of his debriefings and in his communicationswith the probation officer demonstrates the far-reaching impact ofthe district court’s involvement in the plea negotiations. We conclude that theNo. 11-50482 cons. w/ 11-50484

25 participation affected Pena’s substantial rights, because it was “sufficient to undermine confidence in the outcome of the proceeding.” Dominguez Benitez, 542 U.S. at 83 (citation omitted). Finally, “we do not view the fourth prong [of plain-error review] as automatic if the other three prongs are met.” U nited Statesv. Escalante-Reyes, 689 F.3d 415, 425 (5th Cir. 2012) (en banc) (citation omitted). Further, the Supreme Court recently re-emphasized the inherent “screening criteria” contained within the plain-error rule, under which a defendant’sfailure toobject “may well count against” the grant ofrelief. SeeHenderson v. United States, 133 S. Ct. 1121, 1130 (2013). Recognizing Pena’s high burden ofdemonstrating prejudiceon plain-error review, we nevertheless conclude that the district c ourt’s participation in the plea negotiations warrants reversal in this case. For all of the reasons we have discussed, the district court’s error “seriously affected the fairness, integrity, [and] public reputation of thejudicial proceeding.” See Broussard, 669 F.3d at 553 (citation omitted). The district court’s participation precipitated Pena’s efforts to “resolve the SDVO matter” through his pleas and debriefings, caused him to proceed pro se in most subsequent proceedings before the district court, and revealed a potential conf lict of interest between Pena and Stanton and undermines confidence in the resulting plea deal. In these ways, this case presents those exceptional circumstances that warrant reversal on plain error. Adams, 634 F.2d at 836 (c oncluding that the fourth prong was satisfied after judicial participation in plea discussions). See United States v. Atkinson, 297 U.S. 157, 160 (1936) (“In exceptional circumstances,

. . . appellate courts, in the public interest, may

. . . notice errors to which no exception has been taken[.]”); see also United States v. Young, 470 U.S. 1, 15 (1985) (quoting United States v.No. 11-50482 cons. w/ 11-50484

26 Frady, 456 U.S. 152, 163 n.14 (1984)) (noting that the plain-error rule should be employed when “a miscarriage of justice would otherwise result”). We applaud the districtjudge’s recognition ofhiserror when he attempted to ameliorate the potential effects of his statements by communicating to the parties, through his lawclerk, that they were todisregard thecondition. Despite the best efforts of the trial judge, how ever, his comments had unintended consequences. Thus, in light of our precedents, the appropriate remedy is vacatur of Pena’s guilty pleas and sentences and reassignment of his cases to a differentjudge on remand. See Daigle , 63 F.3d at 349 (“‘[I]n order to extend the prophylactic scheme established by Rule 11,’ this case will be assigned to a different judge on remand.” (quoting Miles, 10 F.3d at 1142)). III. CONCLUSION For the foregoing reasons, we VACATE Pena’s guilty pleas and sentences, and we REMAND for further proceedings before a different district judge.