Court Opinion

ID: 4421387
Source: CourtListenerOpinion
Date Created: 2019-07-31 00:00:18.651684+00
Date Added: 2024-06-11T12:33:08.132939
License: Public Domain

Case: 18-11001   Document: 00515055300       Page: 1   Date Filed: 07/30/2019

        IN THE UNITED STATES COURT OF APPEALS
                 FOR THE FIFTH CIRCUIT
                                                               United States Court of Appeals
                                                                        Fifth Circuit

                                   No. 18-11001                       FILED
                                                                  July 30, 2019
                                                                 Lyle W. Cayce
UNITED STATES OF AMERICA,                                             Clerk

            Plaintiff - Appellee

v.

NYGUL ANDERSON; ALBERT GONZALEZ,

             Defendants - Appellants

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

Before HIGGINBOTHAM, SMITH, and SOUTHWICK, Circuit Judges.
PATRICK E. HIGGINBOTHAM, Circuit Judge:
      Seventeen-year-old Jose Torres, eighteen-year-old Albert Gonzalez,
nineteen-year-old Nygul Anderson, and twenty-one-year-old Fernando
Cabrera set off from McAllen, Texas to pick up a delivery of what they
understood to be “drug money” in Fort Worth. Instead, they drove into an FBI
sting operation, part of an investigation into an attempted kidnapping and
extortion. Anderson and Gonzalez were convicted for conspiracy to possess the
proceeds of extortion, conspiracy to violate the Travel Act, and attempted
money laundering. They appeal, arguing the evidence was insufficient to
support their convictions, and also challenge their sentences. We AFFIRM
Anderson’s and Gonzalez’s convictions for conspiracy to violate the Travel Act,
    Case: 18-11001   Document: 00515055300    Page: 2   Date Filed: 07/30/2019

                               No. 18-11001
REVERSE their convictions for attempted money laundering, REVERSE
Anderson’s conviction for conspiracy to possess extortion proceeds, VACATE
their sentences and REMAND for resentencing.
                                     I.
     In September 2017, Raymundo Diaz Martinez of Fort Worth, Texas
received a telephone call from Mexico, telling him that his brothers had been
kidnapped, and would be murdered unless Raymundo paid a $300,000 ransom,
eventually reduced to $20,000. Raymundo, followed the kidnapper’s
instructions, placed $20,000 next to a dumpster at a 7-Eleven in Fort Worth.
Raymundo’s brothers were released and returned home. Two days later, the
kidnapper again threatened to kidnap and murder Raymundo’s brothers if
Raymundo did not make a further $100,000 payment, eventually lowering the
demand to $20,000. This time, Raymundo contacted the FBI. Setting its trap,
the FBI directed Raymundo to continue the contact and agree to pay the
kidnapper.
     Nine days later, Fernando Cabrera received a WhatsApp voicemail
message in McAllen, Texas from a friend named “Pancho,” a drug dealer in
Monterrey, Mexico. Pancho told Cabrera that he was expecting a delivery of
money in Texas and wanted Cabrera to pick it up. Cabrera agreed and
discussed with Pancho means of converting the cash to bank deposits or
prepaid telephone cards. Pancho agreed to give Cabrera ten percent of the
money as a payment for his services. Cabrera’s roommate and best friend
Albert Gonzalez was lying next to Cabrera in bed during this conversation.
Because Pancho and Cabrera were using WhatsApp’s voicemail messaging
function, Gonzalez heard the conversation. Gonzalez agreed to join Cabrera in
the pick up. Cabrera and Gonzalez then discussed the plan. They understood
the delivery involved payments for Pancho’s drugs.

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                                No. 18-11001
      Neither Cabrera nor Gonzalez had a car, so they enlisted an
acquaintance, Jose Torres, to drive, although he had no car and his mother
refused to let him drive hers. Torres then recruited his classmate and friend
Nygul Anderson to drive, both understanding that they were to pick up drug
money. At some point before or during the drive, Cabrera shared a modification
to the plan: he would steal Pancho’s money, and pay $1,000 to Torres, $1,500
to Anderson, and $4,000 to Gonzalez, and buy clothes for each of them.
      On October 13, 2017, the four young men set off from McAllen towards
Houston. During the drive, Pancho informed Cabrera that the money would be
dropped off for them in Fort Worth. Later the same day, under instruction from
the FBI, Raymundo dropped off a bag at a Home Depot in Fort Worth.
Anderson’s car with its four occupants arrived in the same Home Depot
parking lot, and, while attempting to retrieve the bag, all four occupants were
intercepted and arrested by FBI agents.
      Anderson and Gonzalez were indicted in counts of conspiracy to possess
extortion proceeds, conspiracy to use an interstate facility to commit a Travel
Act violation, and attempted money laundering. State prosecutors charged
Torres with engaging in organized crime; he agreed with federal prosecutors
to testify against Anderson and Gonzalez. Cabrera accepted a guilty plea. The
Court conducted a bench trial of Anderson and Gonzalez in February 2018. At
the close of the Government’s case, both defendants moved for acquittal,
arguing the evidence was insufficient to sustain convictions on each of the
three counts. The district court deferred ruling on these motions, and at the
close of evidence found Anderson and Gonzalez guilty on all counts, sentencing
Anderson to 36 months and Gonzalez to 30 months of imprisonment. This
appeal followed.

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                                     No. 18-11001
                                            II.
       We have jurisdiction over Anderson’s and Gonzalez’s appeals of final
decisions and sentences of the district court. 1 In considering a challenge to the
sufficiency of the evidence for a conviction, we ask “whether the finding of guilt
is supported by . . . evidence sufficient to justify the trial judge, as the trier of
fact, in concluding beyond a reasonable doubt that the defendant is guilty.” 2
We “view all evidence in the light most favorable to the government and defer
to all reasonable inferences by the trial court,” without “weigh[ing] evidence”
or “determin[ing] the credibility of witnesses.” 3 “A challenge to the sufficiency
of the evidence that is procedurally preserved . . . is reviewed de novo.” 4
                                            A.
       The Travel Act prohibits “travel[ing] in interstate or foreign commerce
or us[ing] 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,” and
then performing or attempting such act. 5 A business enterprise involving
narcotics or controlled substances is an “unlawful activity” under the Act. 6 A
business enterprise is “a continuous course of conduct, rather than sporadic
casual involvement in a proscribed activity.” 7 “We do not . . . require the
government to prove that the defendant personally engaged in a continuous

       128 U.S.C. § 1291; 18 U.S.C. § 3742.
       2United States v. Smith, 895 F.3d 410, 415 (5th Cir. 2018) (internal quotation marks
omitted), cert. denied, 139 S. Ct. 495 (2018).
      3 Id. at 415–16 (internal quotation marks omitted).
      4 United States v. McElwee, 646 F.3d 328, 340 (5th Cir. 2011) (quotation marks

omitted).
      5 18 U.S.C. § 1952(a).
      6 Id. § 1952(b)(i)(1).
      7 United States v. Carrion, 809 F.2d 1120, 1127 (5th Cir. 1987) (quotation marks

omitted).

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                                      No. 18-11001
course of conduct. Rather, the government must prove only that there was a
continuous business enterprise and that the defendant participated in the
enterprise.” 8 Knowing promotion of one transaction in the broader enterprise
is promotion of the enterprise itself. 9 To prove conspiracy, the Government
must prove that the defendant was one of two or more persons agreeing to
commit the offense, and that a conspirator undertook an act “to effect the object
of the conspiracy.” 10
       Anderson and Gonzalez concede they agreed to use an interstate
facility—namely, Cabrera’s cellphone—with the intent of promoting or
facilitating what they understood to be Pancho’s drug transaction. They argue,
however, that, in so doing, the evidence establishes at most their role in “a one-
off . . . isolated incident”— activity that was not continuous, and therefore not
an unlawful business enterprise under the Act. 11
       We disagree. The Government’s evidence established that both Anderson
and Gonzalez understood they were driving to the Fort Worth area to pick up
“drug money.” Gonzalez had overheard Cabrera’s original exchange with
Pancho—whom he had personally met in Reynosa, Mexico earlier that year.
Cabrera was well aware of Pancho’s occupation. Cabrera and Gonzalez were
best friends, who shared a room, even a bed. It would be reasonable to infer
that Gonzalez shared Cabrera’s awareness of Pancho’s drug enterprise.

       8 United States v. Ruiz, 987 F.2d 243, 251 (5th Cir. 1993) (citation omitted).
       9 Carrion, 809 F.2d at 1127.
       10 18 U.S.C. § 371.
       11 Appellants argue that Cabrera’s WhatsApp messages with Pancho, which indicated

a continuous enterprise, were inadmissible hearsay, and that in the absence of this evidence,
the Government would have been unable to prove their knowledge of a broader criminal
enterprise. But Appellants concede that messages exchanged by co-conspirators in
furtherance of a conspiracy were admissible. Both defendants were part of a drug-trafficking
conspiracy; Cabrera’s messages coordinated their participation in this conspiracy. To the
extent there were other messages concerning other matters, appellants have not established
the district court’s reliance on those messages.
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                                No. 18-11001
      Anderson’s connection to Cabrera and Gonzalez ran through his friend
and classmate Jose Torres. Torres knew Cabrera, and understood that Cabrera
was “bad,” with a lot of money and “into . . . drugs.” When Cabrera offered
Torres $1,000 to drive him to Fort Worth, and Torres could not use his car,
Torres enlisted Anderson, telling him about Cabrera’s offer. Anderson and
Torres then both met with Cabrera to discuss the drive. Anderson agreed to
drive after he confirmed with Cabrera that they would not be transporting
guns or drugs. Cabrera told them they were driving to pick up money from his
“uncle[].”
      During the drive, occupants of the car could follow Cabrera’s
conversations with a caller from “MTY”—which Torres understood to be
Monterrey, Mexico. At one point Torres overheard a three-way call in which
Cabrera and two interlocutors discussed the money drop. One of Cabrera’s
interlocutors texted Cabrera a photo of the money, which Cabrera showed to
his fellow travelers: Torres testified that it was “[m]ore money than [he] had
ever seen in [his] life.” As they approached Fort Worth, Cabrera—informed by
interlocutors on the phone—instructed his companions to go to a Home Depot
parking lot to receive the money. There Cabrera and Gonzalez left the car to
look through bushes for police or other suspicious circumstances. Torres
testified that, based on the circumstances, he surmised they were picking up
“drug money.” It would be reasonable to infer that Anderson reached a similar
conclusion. It also would be reasonable to infer that Anderson understood he
was involved in one leg of a drug transaction, one within a broader drug-
trafficking enterprise involving a large quantity of money and a network of
criminal actors, including persons in Mexico. The evidence was sufficient to
support Anderson’s and Gonzalez’s convictions for conspiracy to violate the
Travel Act.

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                                       No. 18-11001
                                              B.
       Under 18 U.S.C. § 1956, it is unlawful to conduct or attempt to conduct
a financial transaction “knowing that the property involved in [the] financial
transaction represents the proceeds of some form of unlawful activity” with the
“intent to promote the carrying on of specified unlawful activity; or . . . knowing
that the transaction is designed in whole or in part . . . to conceal or disguise
the nature, the location, the source, the ownership, or the control of the
proceeds of specified unlawful activity.” 12 A “transaction” includes “a purchase,
sale, loan, pledge, gift, transfer, delivery, or other disposition.” 13 A financial
transaction is a transaction that affects interstate or foreign commerce
involving the movement of funds or monetary instruments. 14 Drug trafficking
is a specified unlawful activity under the statute. 15 Accordingly, courts have
interpreted the statute to require a financial transaction that follows the
underlying criminal activity that generates the proceeds. 16 That is, the statute
requires that the laundering transaction be distinct from the criminal conduct
generating the proceeds to-be-laundered—if it were otherwise, any criminal
activity involving an exchange of money would double as a laundering
offense. 17 “To be guilty of an attempt, the defendant (1) must have been acting
with the . . . culpability otherwise required for the commission of the crime

       12  18 U.S.C. § 1956.
       13  Id. § 1956(c)(3).
        14 Id. § 1956(c)(4)(A).
        15 Id. § 1956(c)(7)(B)(i)–(ii).
        16 United States v. Gaytan, 74 F.3d 545, 555–56 (5th Cir. 1996); United States v.

Harris, 666 F.3d 905, 910 (5th Cir. 2012) (“The crime of money laundering is targeted at the
activities that generally follow the unlawful activity in time.”); United States v. Johnson, 971
F.2d 562, 569 (10th Cir. 1992).
        17 See, e.g., Harris, 666 F.3d at 909 (“[M]ere payment of the purchase price for drugs

by whatever means (even by a financial transaction as defined in § 1956) does not constitute
money laundering.”).

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                                       No. 18-11001
which he is charged with attempting, and (2) must have engaged in conduct
which constitutes a substantial step toward commission of the crime.” 18
       Anderson and Gonzalez argue that the evidence was insufficient to
establish the actus reus required for attempted money laundering: an
attempted financial transaction with the proceeds of criminal activity. The
Government offers multiple theories of the actus reus. 19 None are viable. At
trial the Government urged that the actus reus occurred when Anderson and
Gonzalez arrived at the Fort Worth Home Depot and attempted to retrieve
Raymundo’s bag of money:
              [W]hen they picked up the money from Raymundo,
              Raymundo was transferring the money from
              Raymundo to them, to the four conspirators. That is a
              transfer. . . . We have charged it as attempted money
              laundering, so that transfer doesn’t actually have to
              take place, it just . . . had to be their attempt, and so
              in this case . . . there was an attempt to transfer money
              from the victim, Raymundo Martinez, to these four
              conspirators.

This theory is short an element of the offense of attempted money laundering.
The attempted pick up in the Home Depot parking lot was part of an attempted
drug-trafficking transaction, criminal conduct that would have generated
proceeds, which the defendants then planned to launder in a distinct later
transaction. In fact, the monies Anderson and Gonzalez attempted to transfer
in the Home Depot parking lot were not yet “proceeds” because the pick up was

       18United States v. Salazar, 958 F.2d 1285, 1293 (5th Cir. 1992) (internal quotation
marks omitted).
      19 The actus reus is the guilty act, a violation if done with mens rea, the guilty mind.

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                                      No. 18-11001
interrupted by the FBI’s arrests—under our caselaw money does not become
proceeds until the underlying criminal transaction is complete. 20
       The alternative theories of the actus reus fail for similar reasons. Rather
than accepting the government’s trial theory, the district court instead found
that Anderson and Gonzalez attempted the necessary financial transaction
when they planned to purchase clothes and other items with the retrieved
money:
              The Government presented evidence and witness
              testimony to show that Cabrera and Defendants
              intended to complete a financial transaction with the
              extortion proceeds by shopping for clothing, a car, and
              other purchases.

The problem with this theory is that Anderson’s and Gonzalez’s actions were
interrupted by their arrests: as they never laid hands on the promised delivery
of money, the planned purchases remained just that—plans. Their conduct
stopped at the attempted drug trafficking and never advanced far enough for
them to effect any part of the follow-on laundering transaction that they
planned.
       On appeal the Government offers us a third theory of the actus reus,
urging that we “affirm on the basis of the original plan: the plan to launder the
retrieved money through [the] cell phone store.” This theory fails for the same
reason. The Government argues it is reasonable to infer that Anderson and
Gonzalez joined Cabrera’s initial plans to launder the money using prepaid
phone cards. Perhaps, but the Government cannot point to a substantial step
in this transaction. At oral argument, Government counsel offered Anderson

       20Gaytan, 74 F.3d at 555–56 (distinguishing “a transaction to pay for illegal drugs”—
involving third parties retrieving the drug money—from a laundering transaction, “because
the funds involved are not proceeds of an unlawful activity when the transaction occurs, but
become so only after the transaction is completed”); Harris, 666 F.3d at 910 (“Money does not
become proceeds of illegal activity until the unlawful activity is complete.”).
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                                    No. 18-11001
and Gonzalez’s decision to drive to the agreed-upon pickup location as the
necessary substantial step. But by the time they were driving, the four
companions had already abandoned the phone-card plan and resolved to steal
Pancho’s money. The evidence does not establish that either Gonzalez or
Anderson took any substantial step towards a laundering transaction
involving phone cards. As with the defendants’ shopping spree, the phone-card
transaction was a mere plan. The statute does not criminalize planning, it
criminalizes an attempt—which requires a substantial step. The evidence was
insufficient to support Anderson’s and Gonzalez’s convictions for attempted
money laundering.
                                         C.
      “A person who receives, possesses, conceals, or disposes of any money or
other property which was obtained from” extortion “knowing the same to have
been unlawfully obtained, shall be imprisoned not more than 3 years, fined
under this title, or both.” 21 A defendant can be convicted of conspiracy, where
he was one of two or more persons conspiring to commit an offense against the
United States, and a conspirator undertook an act “to effect the object of the
conspiracy.” 22
      Anderson challenged his conviction for conspiracy to possess extortion
proceeds, arguing the evidence was insufficient to establish that he or any of
his co-conspirators had specific intent to possess money derived from extortion.
To support the conviction, the Government relies on Section 880’s language,
which states that the requisite mens rea for possession of extortion proceeds is
only knowledge that the monies were unlawfully obtained, not that they
resulted from extortion. The Government argues it was required only to prove

      21   18 U.S.C. § 880.
      22   Id. § 371.
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                                      No. 18-11001
the mens rea required for conviction of the underlying crime (possession of
extortion proceeds). The district court accepted the Government’s position.
       The Government correctly states the mens rea for the underlying offense
of possession of extortion proceeds. But Anderson was convicted of conspiracy
to commit this offense. The mens rea for conspiracy is distinct and more
demanding. To be guilty of conspiracy, “[a] defendant must . . . reach an
agreement with the specific intent that the underlying crime be committed by
some member of the conspiracy.” 23 Here, that would require proof of
Anderson’s specific intent that at least one of his co-conspirators possess
extortion proceeds and do so with the knowledge that the money was
unlawfully obtained. The evidence cannot support this mens rea. Trial
testimony established that Anderson agreed to retrieve and possess what he
thought were the proceeds of drug trafficking. This is also what the district
court found. Anderson had no knowledge that extortion was afoot. The
evidence fails to support the requisite mens rea and therefore Anderson’s
conviction for conspiracy to possess extortion proceeds.
                                            III.
       We AFFIRM Anderson’s and Gonzalez’s convictions for conspiracy to
violate the Travel Act, REVERSE their convictions for attempted money
laundering, REVERSE Anderson’s conviction for conspiracy to possess
extortion proceeds, VACATE Anderson’s and Gonzalez’s sentences, and
REMAND for resentencing.

       23Ocasio v. United States, 136 S. Ct. 1423, 1429 (2016) (quotation marks and emphasis
omitted); United States v. Chapman, 851 F.3d 363, 378 (5th Cir. 2017) (“To be liable as a co-
conspirator, an individual must enter the agreement with the ‘specific intent that the
underlying crime be committed.’” (quoting Ocasio, 136 S. Ct. at 1429)).
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