Court Opinion

ID: 4857545
Source: CourtListenerOpinion
Date Created: 2021-08-25 00:01:29.006651+00
Date Added: 2024-06-11T08:11:53.581750
License: Public Domain

Case: 19-40524     Document: 00515992937          Page: 1    Date Filed: 08/24/2021

              United States Court of Appeals
                   for the Fifth Circuit                           United States Court of Appeals
                                                                            Fifth Circuit

                                                                          FILED
                                                                    August 24, 2021
                                   No. 19-40524
                                                                     Lyle W. Cayce
                                                                          Clerk
   United States of America,

                                                             Plaintiff—Appellee,

                                       versus

   Ravinder Reddy Gudipati; Harsh Jaggi; Neeru Jaggi;
   Luis Montes-Patino; Adrian Arciniega-Hernandez,

                                                        Defendants—Appellants.

                  Appeal from the United States District Court
                      for the Southern District of Texas
                            USDC No. 5:17-CR-560

   Before King, Dennis, and Ho, Circuit Judges.
   Per Curiam:*
          A jury convicted Ravinder Reddy Gudipati, Harsh Jaggi, Neeru Jaggi,
   Luis Montes-Patino, and Adrian Arciniega-Hernandez of charges related to
   money laundering, including conspiracy. All five defendants appealed,

          *
            Pursuant to 5th Circuit Rule 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   opinion should not be published and is not precedent except under the limited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 Circuit Rule 47.5.4.
Case: 19-40524     Document: 00515992937           Page: 2   Date Filed: 08/24/2021

                                    No. 19-40524

   bringing a variety of challenges to their convictions and the district court’s
   rulings. We affirm.
                                         I.
          This appeal involves a conspiracy to launder illegal drug proceeds
   from the United States by turning them into legitimate commercial proceeds
   in Mexico using the Black Market Peso Exchange (BMPE). The BMPE is a
   trade-based money laundering scheme, which works by concealing the source
   of illegal money through what appear to be legitimate business transactions
   between American exporters and Mexican importers. A Mexican drug
   trafficking organization (DTO) sells drugs in the United States for dollars
   with the goal of bringing the value of those dollars to Mexico as “clean”
   pesos. To accomplish this, a DTO connects with Mexican importers through
   a “peso broker.” The broker places an order for dollars with the DTO using
   pesos from the Mexican importers. Then, the broker directs couriers in the
   United States to pick up money from drug traffickers and deliver it to
   American exporters, who ship goods to the Mexican importers.
          All five defendants played a role in the BMPE. Defendant Montes-
   Patino was a money courier who brought cash to Laredo, Texas to be
   laundered through American export businesses. He admitted that he knew
   the cash was from an unlawful source. Defendants Harsh and Neeru Jaggi
   owned El Reino, and defendant Gudipati owned NYSA Impex. Both stores
   received drug proceeds as payment for their perfumes, which they shipped
   to Mexican importers. Defendant Arciniega-Hernandez worked for Carlos
   Velasquez-Flores, who pleaded guilty to conspiracy to commit money
   laundering.   Velasquez-Flores owned a shipping company, Velasquez
   Transportes, which packaged and transported drug proceeds.               The
   government infiltrated the conspiracy using undercover officers, wiretaps,
   and an informant, Corina Blake, who recorded phone calls and transactions

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                                          No. 19-40524

   with suspected members of the conspiracy. Consequently, the government
   was able to observe dozens of Bulk Currency Transactions (BCTs) involving
   Montes-Patino, Arciniega-Hernandez, Gudipati, and the Jaggis.
           In 2018, a grand jury indicted, inter alia, Arciniega-Hernandez, Harsh
   Jaggi, Neeru Jaggi, Gudipati, and Montes-Patino for their roles in the money
   laundering scheme. All five defendants were charged with conspiring to
   commit money laundering in violation of 18 U.S.C. § 1956(h). Additionally,
   some of the defendants were charged with various substantive money
   laundering offenses, in violation of 18 U.S.C. § 1956(a)(1)(B)(i) and (ii) and
   18 U.S.C. § 1956(a)(3)(B) and (C). 1 The jury found Harsh Jaggi, Neeru Jaggi,
   Gudipati, and Montes-Patino guilty on all counts. The jury found Arciniega-
   Hernandez guilty on all counts except his additional count of money
   laundering. After the government’s case-in-chief, Defendants moved for
   judgments of acquittal, which the district court denied. Defendants renewed
   their motions at the close of all the evidence. Again, the district court denied
   them.
                                                II.
           There are five issues on appeal, each argued by a different defendant
   or group of defendants.
                                                A.
           First, Arciniega-Hernandez, Harsh Jaggi, Neeru Jaggi, and Gudipati
   each challenge the sufficiency of the evidence to support their conspiracy and
   money laundering convictions. Because Defendants moved for judgments of
   acquittal before the district court, we review insufficiency-of-the-evidence

           1
             Gudipati was also charged with three counts of causing a business to fail to file or
   file incorrect monetary transaction reports, in violation of 31 U.S.C. § 5324(b)(1) and (2).
   He was convicted on all three and does not challenge them on appeal.

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   claims de novo. See United States v. Harris, 666 F.3d 905, 907 (5th Cir. 2012).
   We “view the evidence in the light most favorable to the verdict and [will]
   uphold the verdict if, but only if, a rational juror could have found each
   element of the offense beyond a reasonable doubt.” United States v. Brown,
   186 F.3d 661, 664 (5th Cir. 1999). Our “inquiry is limited to whether the
   jury’s verdict was reasonable, not whether we believe it to be correct.”
   United States v. Scott, 892 F.3d 791, 797 (5th Cir. 2018) (quoting United States
   v. Alaniz, 726 F.3d 586, 601 (5th Cir. 2013)).
          Each defendant was charged with conspiring to commit money
   laundering in violation of 18 U.S.C. § 1956(h). The government had to show
   “(1) that there was an agreement between two or more persons to commit
   money laundering and (2) that the defendant joined the agreement knowing
   its purpose and with the intent to further the illegal purpose.” United States
   v. Fuchs, 467 F.3d 889, 906 (5th Cir. 2006).
          Here, the government alleged conspiracy to commit both
   concealment and avoidance money laundering.            For concealment, the
   government must prove that the transactions “had the purpose, not merely
   the effect, of ‘making it more difficult for the government to trace and
   demonstrate the nature of the funds.’” United States v. Valdez, 726 F.3d 684,
   690 (5th Cir. 2013) (alterations omitted) (quoting United States v. Brown, 553
   F.3d 768, 787 (5th Cir. 2008)). For avoidance, the government must prove
   that the defendant was aware of certain reporting requirements and knew the
   transaction was designed to avoid those requirements. See, e.g., United States
   v. Bronzino, 598 F.3d 276, 281 (6th Cir. 2010).
          Additionally, Arciniega-Hernandez, the Jaggis, and Gudipati were
   each charged with a substantive money laundering offense under 18 U.S.C. §
   1956(a)(1)(B). Arciniega-Hernandez was charged with an additional count of
   concealment money laundering, in violation of 18 U.S.C. § 1956(a)(1)(B)(i).

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   The government needed to prove that they actually conducted or attempted
   to conduct a financial transaction with proceeds of a specified unlawful
   activity with knowledge that its purpose was to conceal the source of the
   proceeds or avoid transaction reporting requirements. United States v. Cessa,
   785 F.3d 165, 173–74 (5th Cir. 2015).
          Finally, Harsh Jaggi and Gudipati were each charged with one
   substantive count of laundering money represented to be the proceeds of
   drug trafficking (sting money laundering), in violation of 18 U.S.C. §
   1956(a)(3)(B) and (C).        The government needed to prove that they
   conducted or attempted to conduct “a financial transaction involving
   property represented to be the proceeds of specified unlawful activity” with
   the intent either “to conceal or disguise the nature, location, source,
   ownership, or control of property believed to be the proceeds of specified
   unlawful activity” or to avoid a transaction reporting requirement. 18 U.S.C.
   § 1956(a)(3)(B) & (C). See also United States v. Castaneda-Cantu, 20 F.3d
   1325, 1330 (5th Cir. 1994).
          After hearing oral argument and a careful review of the record, briefs,
   and applicable legal standards, we conclude that the evidence was sufficient
   to convict Arciniega-Hernandez, Harsh Jaggi, Neeru Jaggi, and Gudipati of
   all charges. We briefly summarize the relevant evidence.
          Arcinega-Hernandez received large sums of money in commercial
   parking lots; delivered large sums to others in bags; counted, separated,
   marked, and packaged money in various denominations; referred to the
   money using code names; and knew the amounts of money to be delivered
   and picked up and the identity of the people making the drops. The Jaggis
   regularly received tens of thousands of dollars in cash, packaged in small
   denominations, and wrapped in rubber bands, and were told it was “narco
   money.” The Jaggis failed to report cash in amounts greater than $10,000

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   (in violation of federal law); denied knowing the courier, Blake; kept two sets
   of ledgers to underreport cash transactions; structured transactions to avoid
   reporting requirements; failed to report certain transactions; and concealed
   the identity of transaction participants.       Similarly, Gudipati regularly
   received tens of thousands of dollars in cash, packaged in small
   denominations, wrapped in rubber bands, and carried in plastic bags.
   Gudipati was told it was “narc money” and that the courier “was at risk with
   the police bringing this [money] like that.” Gudipati consistently failed to
   report cash deposits greater than $10,000; concealed that a courier was
   bringing in the cash deposits; and knew that his actions violated federal
   reporting requirements. In light of this evidence, a rational juror could find
   all the elements of conspiracy to commit money laundering and substantive
   money laundering beyond a reasonable doubt.
                                         B.
          Second, Arciniega-Hernandez argues that the district court’s jury
   instruction pursuant to Pinkerton v. United States, 328 U.S. 640 (1946),
   constructively amended his indictment.
          Arciniega-Hernandez was charged with several counts of substantive
   money laundering. Under Pinkerton, a member of a conspiracy may be
   convicted of any foreseeable substantive offense that a co-conspirator
   commits in furtherance of the conspiracy. See United States v. Sanjar, 876
   F.3d 725, 743 (5th Cir. 2017). The proposed jury instructions did not include
   a Pinkerton instruction. The government requested one, and defense counsel
   objected, arguing that the instruction was “not required” because there was
   evidence Arciniega-Hernandez “conducted a transaction.”              Notably,
   defense counsel did not argue that a Pinkerton instruction would
   constructively amend the indictment. The court noted that the instruction
   was necessary to uphold a defendant’s conviction under an agency theory of

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   liability and gave the instruction. United States v. Polk, 56 F.3d 613, 619 n.4
   (5th Cir. 1995) (“[A] substantive conviction cannot be upheld solely under
   Pinkerton unless the jury was given a Pinkerton instruction.”).
          We review a preserved claim of constructive amendment de novo. See
   United States v. Jara-Favela, 686 F.3d 289, 299 (5th Cir. 2012). Arciniega-
   Hernandez argues that de novo review applies because he “specifically
   objected” to the Pinkerton instruction. While he did object, he argued only
   that the instruction was “not required” because he “conducted a
   transaction.” He did not specifically argue that the instruction would
   constructively amend the indictment, so he did not preserve that argument.
   We review unpreserved claims of constructive amendment for plain error,
   which first requires a defendant to identify an error. See, e.g., United States
   v. Chaker, 820 F.3d 204, 213 (5th Cir. 2016).
          Arciniega-Hernandez doesn’t identify any error with the district
   court’s Pinkerton ruling. Constructive amendment occurs when a court
   “permits the defendant to be convicted upon a factual basis that effectively
   modifies an essential element of the offense charged” or upon “a materially
   different theory or set of facts than that with which [he] was charged.”
   United States v. McMillan, 600 F.3d 434, 451 (5th Cir. 2010). We reverse a
   conviction only if the difference between the indictment and the jury
   instructions “allows the defendant to be convicted of a separate crime from
   the one for which he was indicted.” United States v. Nuñez, 180 F.3d 227,
   231 (5th Cir. 1999). The “key inquiry is whether the jury charge broadened
   the indictment.” United States v. Griffin, 800 F.3d 198, 202 (5th Cir. 2015).
          Here, the instruction did not broaden the indictment. It merely
   permitted the jury to convict Arciniega-Hernandez of Counts Three, Four,
   and Five of the indictment if it found him guilty of the conspiracy charged in
   Count One of the indictment. See United States v. Jimenez, 509 F.3d 682, 692

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   (5th Cir. 2007) (explaining that when there is sufficient evidence to prove
   that a defendant was a knowing member of the conspiracy, “no additional
   evidence is necessary to warrant a conviction on a substantive count which
   charges him with an event which occurred while he was active as a member
   of the conspiracy”). Thus, Arciniega-Hernandez fails to demonstrate that
   the district court erred in giving the Pinkerton instruction. Accordingly, we
   need not consider the other prongs of plain error review.
                                         C.
          Third, Gudipati argues that the district court improperly calculated
   the loss amount attributable to him at sentencing. The PSR states that the
   total loss amount caused by Gudipati’s offense conduct is $262,900. The
   amount included the money from several BCTs and one other transaction as
   relevant conduct under U.S.S.G. § 1B1.3(a)(1). Consequently, the PSR
   increases Gudipati’s offense level from 8 to 20. U.S.S.G. § 2B1.1(b)(1)(G).
   The PSR also reflects a six-level adjustment under U.S.S.G. § 2S1.1(b)(1)
   because Gudipati knew the money was from drug proceeds. Gudipati
   objected to the § 2S1.1(b)(1) adjustment before and during sentencing,
   arguing that he did not know the money was from unlawful activity until the
   final transaction.
          We review a district court’s determination of a loss amount for clear
   error. See United States v. Peterson, 101 F.3d 375, 384 (5th Cir. 1996). We
   also review a district court’s factual determination of what constitutes
   relevant conduct for purposes of sentencing for clear error. Id.
          Gudipati argues that, if we reverse on Count Three but affirm on
   Counts One and Six, we should remand the case for resentencing. Since we
   affirm Gudipati’s conviction on Count Three, we do not need to address this
   conditional challenge to his sentence. In any event, the district court did not
   clearly err in calculating Gudipati’s loss amount.

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                                           D.
          Fourth, Gudipati, Harsh Jaggi, and Neeru Jaggi argue that they were
   improperly sentenced before a district judge who did not preside over their
   trial. The court originally scheduled sentencing for Gudipati and the Jaggis
   before Judge Maria Garcia Marmolejo, who presided over the trial. Harsh’s
   defense counsel moved to reschedule sentencing due to a conflict.
   Sentencing was rescheduled and was reassigned to Judge Micaela Alvarez.
   Later, Judge Marmolejo explained she was absent from the district and
   unable to preside over the sentencing.
          Gudipati and the Jaggis moved to reconsider the reassignment,
   arguing that Judge Marmolejo was in the best position to consider the legal
   and factual arguments to be raised at sentencing given the complexity of the
   case. Judge Alvarez denied the motions. We review decisions to reassign a
   case for sentencing pursuant to Federal Rule of Criminal Procedure 25(b) for
   abuse of discretion. See United States v. Bourgeois, 950 F.2d 980, 988 (5th
   Cir. 1992).
          Federal Rule of Criminal Procedure 25(b)(1) provides that “[a]fter a
   verdict or finding of guilty, any judge regularly sitting in or assigned to a court
   may complete the court’s duties if the judge who presided at trial cannot
   perform those duties because of absence, death, sickness, or other
   disability.”    Because Judge Marmolejo was absent at sentencing,
   reassignment here complied with Rule 25(b)(1). See United States v. Dowd,
   451 F.3d 1244, 1256 (11th Cir. 2006) (“Because [the trial judge] became
   absent at the time of sentencing, reassignment of the case to [another judge]
   was proper under Rule 25.”).
          We have held that it was not an abuse of discretion for a successor
   sentencing judge to sentence a defendant where the judge “displayed a
   familiarity with the record at the sentencing hearing that reflects such a

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   thorough review.” Bourgeois, 950 F.2d at 988. The record shows that Judge
   Alvarez adequately familiarized herself with this case. Accordingly, the
   substitution of Judge Alvarez and her decision to proceed with sentencing
   was not an abuse of discretion.
                                         E.
          Fifth, Montes-Patino argues the district court erred in sentencing him
   in absentia. Montes-Patino repeatedly failed to appear for sentencing and
   counsel could not contact him. The court delayed sentencing several times.
   The Marshals Service reported that Montes-Patino’s family had not seen
   him since spring 2019 and did not know where he was. The Marshals Service
   concluded that he was in Mexico and did not intend to return to the United
   States. The government asked the court to sentence Montes-Patino in
   absentia, and the court agreed because Montes-Patino had been given the
   opportunity to show up, had no contact with his attorney, and was considered
   a fugitive.
          We review a district court’s factual finding that a defendant has
   voluntarily absented himself from sentencing for clear error. See United
   States v. Ornelas, 828 F.3d 1018, 1021 (9th Cir. 2016). We review a decision
   to sentence a defendant in absentia for abuse of discretion. Id.
          Typically, a defendant’s presence is required at sentencing. Fed. R.
   Crim. P. 43(a)(3). But a defendant in a noncapital case waives the right to
   be present “when the defendant is voluntarily absent during sentencing.”
   Fed. R. Crim. P. 43(c)(1)(B). The advisory committee note to the 1995
   amendments states that they “make clear that a defendant who, initially
   present at trial . . . but who voluntarily flees before sentencing, may
   nonetheless be sentenced in absentia.” Id., advisory comm. note (1995).
   Montes-Patino’s argument depends on pre-1995 case law. Based on our
   review of the record, the district court did not clearly err in finding that

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   Montes-Patino was voluntarily absent. Consequently, the district court did
   not abuse its discretion in sentencing Montes-Patino in absentia. Rule 43
   specifically allows it.
                                     ***
          For the foregoing reasons, we affirm the convictions of all five
   defendants.

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