United States v. Fullwood

United States Court of Appeals

Fifth Circuit

F I L E D

IN THE UNITED STATES COURT OF APPEALS August 8, 2003

FOR THE FIFTH CIRCUIT Charles R. Fulbruge III

Clerk

No. 02-10840

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

versus

LEA SCOTT FULLWOOD,

Defendant-Appellant.

Appeal from the United States District Court

for the Northern District of Texas

Before KING, Chief Judge, and HIGGINBOTHAM and BARKSDALE, Circuit

Judges.

RHESA H. BARKSDALE, Circuit Judge:

Primarily at issue are two points: (1) whether the

Government’s use of a summary witness on rebuttal constitutes

reversible plain error; and (2) whether the district court clearly

erred in enhancing defendant’s sentence, pursuant to U.S.S.G. §

3B1.1(a), for his being “an organizer or leader of a criminal

activity that ... was otherwise extensive”. Although the

conviction and sentence are AFFIRMED, we are concerned about

application of these two points in cases of this type.

I.

Lea Scott Fullwood was a farmer in Nolan County, Texas, who

participated in farm assistance programs administered by the

federal Farm Service Agency (FSA). To receive FSA crop disaster

payments, he had to certify to the Nolan County FSA office each of

the crops planted on his farms. He was also entitled to purchase,

through independent crop insurance agents, multiple peril crop

insurance reinsured by the Government. (The private insurers are

reimbursed by the Federal Crop Insurance Corporation (FCIC)

(managed by the Risk Management Agency (RMA)) for certain claims

they pay to insured producers based on crop losses, as well as for

portions of the producers’ premiums, which are subsidized by the

Government.)

In mid-1999, Fullwood was introduced to Darren Jeffrey, an

insurance adjuster. Jeffrey offered to submit fraudulent

appraisals for claims; in return, Jeffrey would receive kickbacks

of five percent of the payments. Fullwood agreed and subsequently

introduced Jeffrey to Fullwood’s father and father-in-law (both

farmers), advising them of the fraudulent scheme.

During 1999, Fullwood farmed cotton and grain sorghum.

However, he did not plant all of the acreage he certified to the

FSA county office or to Hargrove Insurance Company, through which

he had obtained multiple peril crop insurance. (Hargrove Insurance

Company is a broker for Fireman’s Fund Insurance, which issued the

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insurance.) For example, although Fullwood did not plant grain

sorghum on two of his father-in-law’s farms, he certified having

done so. (To carry out this scheme, Fullwood’s father-in-law

executed a “cash lease agreement” between him and Fullwood, which

Fullwood submitted to the FSA to establish the requisite interest

in those farms.)

Fullwood then made fraudulent claims based on acreage he did

not plant, both for crop disaster payments from the FSA and on the

federally-reinsured Fireman’s Fund policies. Fullwood claimed hail

and excess precipitation damaged his cotton crop. In connection

with these claims, he executed various cotton appraisals and

production worksheets. (Jeffrey indicated that he had inspected

certain fields and had taken samples, and that little cotton had

remained. No such inspections were made.) At Fullwood’s request,

Jeffrey also performed bogus appraisals on Fullwood’s grain sorghum

crop; Fullwood submitted similar fraudulent claims asserting that

drought had damaged that crop.

In executing the scheme, Fullwood made extensive use of the

United States mail and private interstate carriers. Ultimately, he

requested more than $310,000 and received approximately $235,000.

(Certain amounts were withheld because Fullwood was under

investigation.)

Fullwood was convicted of: conspiracy to commit mail fraud,

violate the False Claims Act, and make false statements to the

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Government, in violation of 18 U.S.C. §§ 371 & 2; making false

statements to agencies of the United States, in violation of 18

U.S.C. § 287; mail fraud, in violation of 18 U.S.C. § 1341; and,

making false statements in a matter within the jurisdiction of an

agency of the United States, in violation of 18 U.S.C. § 1001. He

was sentenced to 41-months’ imprisonment and ordered to pay

restitution of $235,000.

II.

At issue is whether the district court: (1) abused its

discretion in admitting expert testimony; (2) committed reversible

plain error by allowing the Government to use a summary witness on

rebuttal; and (3) committed clear error by imposing a four-level

sentence enhancement for Fullwood’s having been a leader or

organizer of the criminal activity.

A.

Pre-trial, Fullwood moved to exclude Dr. Brown’s expert

testimony, which was based on satellite imagery. After a hearing

during the trial, just prior to Dr. Brown’s testifying, the

district court overruled Fullwood’s objections.

Dr. Brown testified that, based upon satellite imagery, he

could determine if fields had been vegetated, were without crops,

or had been recently tilled or cultivated. His testimony was

offered to show that satellite images of farms where Fullwood

claimed to have planted certain crops revealed that the crops were

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not planted on the dates claimed by Fullwood. Among other things,

Dr. Brown testified that the farms allegedly leased from Fullwood’s

father-in-law had not been plowed and had remnants of a crop

consistent with hay grazer, not grain sorghum (contrary to the

certification).

The admission of expert testimony is reviewed for abuse of

discretion. E.g., Seatrax, Inc. v. Sonbeck Int’l, Inc., 200 F.3d

358, 371 (5th Cir. 2000). The district court’s role in determining

admissibility of scientific testimony under FED. R. EVID. 702 is that

of gatekeeper. E.g., Daubert v. Merrell Dow Pharmaceuticals, Inc.,

509 U.S. 579 (1993). Rule 702 sets the admission standard:

If scientific, technical, or other specialized

knowledge will assist the trier of fact to

understand the evidence or to determine a fact

in issue, a witness qualified as an expert by

knowledge, skill, experience, training, or

education, may testify thereto in the form of

an opinion or otherwise, if (1) the testimony

is based upon sufficient facts or data, (2)

the testimony is the product of reliable

principles and methods, and (3) the witness

has applied the principles and methods

reliably to the facts of the case.

The proponent has the burden of establishing, by a preponderance of

the evidence, that the pertinent admissibility requirements are

met. See FED. R. EVID. 104(a), cmt.

Even though Fullwood concedes “that the Government’s expert

witness was highly credentialed”, he contends there was too great

a gap between the premise of satellite imagery, as it relates to

crop cultivation, and the conclusion reached by Dr. Brown that

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certain crops were not planted. He also takes issue with: whether

the testimony was within the area of expertise established; and the

rate of error (five percent) as applied to the testimony.

Fullwood’s contentions are conclusory and without merit. In

response to Fullwood’s motion to exclude, the Government submitted

a detailed response that provided a list of 16 articles, all

published in peer-reviewed scientific journals, which demonstrated

the general acceptance in the scientific community of the

techniques used by Dr. Brown. The Government also pointed out that

the Eighth Circuit upheld the admission of Dr. Brown’s testimony in

a similar case. See United States v. Larry Reed & Sons P’ship, 280

F.3d 1212, 1215 (8th Cir. 2002).

At the hearing on the motion, Dr. Brown’s curriculum vitae was

admitted into evidence. As Fullwood acknowledges, Dr. Brown’s

credentials are substantial (including a Ph.D. in horticulture and

numerous publications). Also, at that hearing, Dr. Brown

testified: the remote sensing technology he employs “has been

around for several decades”; his techniques are used “[e]very day”

by science, industry, and government; and there have been “hundreds

of investigations that have been conducted, probably thousands”,

validating his methodology.

The Government satisfied its burden. In short, there was no

abuse of discretion.

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B.

Fullwood next challenges the Government’s use of a summary

witness on rebuttal. For its last witness in its case-in-chief,

the Government called the Special Agent in charge of the

investigation for the USDA. That Special Agent testified both

about conversations he had with Fullwood and Fullwood’s father-in-

law (Fullwood’s co-defendant) and as a summary witness.

On rebuttal, the Government re-called that Special Agent as

its last witness. The Special Agent was allowed to recap a

significant portion of the testimony already introduced by the

Government. Although Fullwood’s father-in-law objected to this

testimony as being outside the scope of rebuttal, Fullwood did not

likewise object. (His father-in-law’s objection was overruled.)

The district court instructed the jury that the testimony of

a summary witness is not “in and of [itself] evidence or proof of

any facts” but is used to explain and should be disregarded “to the

extent ... [it is] not [an] accurate summar[y]”. Along this line,

Fullwood does not contend that the testimony was in any way

inaccurate.

Because Fullwood did not object, we review only for plain

error. See FED. R. CRIM. P. 52(b); e.g., United States v.

Garcia-Flores, 246 F.3d 451, 457 (5th Cir. 2001). This quite

restrictive standard requires Fullwood to demonstrate a “clear” or

“obvious” error that affected his substantial rights. Id. Even

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then, we have discretion to correct the error and will generally

not do so unless it “seriously affect[s] the fairness, integrity,

or public reputation of judicial proceedings”. E.g., United States

v. Calverley, 37 F.3d 160, 164 (5th Cir. 1994) (en banc) (quotation

omitted), cert. denied, 513 U.S. 1196 (1995).

The Government asserts that FED. R. EVID. 1006 allows the use

of summary witnesses. It provides:

The contents of voluminous writings,

recordings, or photographs which cannot

conveniently be examined in court may be

presented in the form of a chart, summary, or

calculation. The originals, or duplicates,

shall be made available for examination or

copying, or both, by other parties at [a]

reasonable time and place. The court may

order that they be produced in court.

As the Government concedes, this rule does not specifically address

summary witnesses or summarization of trial testimony. This

omission is significant — “[p]lainly, th[e] rule does not

contemplate summarization of live testimony presented in court”.

United States v. Castillo, 77 F.3d 1480, 1499 n.36 (5th Cir.),

cert. denied, 519 U.S. 868 (1996).

For complex cases, we have allowed summary witnesses in a

limited capacity. See United States v. Bishop, 264 F.3d 535, 547

(5th Cir. 2001), cert. denied, 535 U.S. 1016 (2002) (allowing IRS

agent to testify as summary witness where summary had foundation in

evidence already admitted and was accompanied by limiting

instruction); United States v. Moore, 997 F.2d 55 (5th Cir. 1993)

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(permitting IRS agent to selectively summarize where facts fell

within his expertise).

On the other hand, there are limits that may well have been

exceeded here, because, as the final rebuttal witness, the Special

Agent was allowed, without justification, to simply recap

substantial portions of the Government’s case-in-chief. The use of

summary evidence serves an important purpose, but that purpose is

not simply to allow the Government to repeat its entire case-in-

chief shortly before jury deliberations. Moreover, there are

obvious potential dangers associated with its use. See, e.g.,

Castillo, 77 F.3d at 1500 (“without good reason or real need,

[summary witness testimony] unfairly allow[ed] one prosecution

witness merely to repeat or paraphrase the in-court testimony of

another”); United States v. Johnson, 54 F.3d 1150 (4th

Cir.)(summary witness testimony inappropriate in normal case given

inherent dangers, including confusion), cert. denied, 516 U.S. 903

(1995); United States v. Baker, 10 F.3d 1374, 1412 (9th Cir. 1993)

(summary witness should only be allowed in “exceptional cases”

because the credibility of summary witness may be substituted for

the credibility of the evidence summarized), cert. denied, 513 U.S.

934 (1994).

In the light of this case having some arguable complexity, our

precedent allowing such testimony in complex cases, the limiting

instruction given, and the unchallenged accuracy of the testimony,

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the summary testimony did not constitute reversible plain error.

Cf. Castillo, 77 F.3d at 1500 (no reversible error where summary

witness “did not misstate or put an unfair ‘spin’ on the testimony

he repeated or paraphrased, and it was uncontradicted”); United

States v. Okoronkwo, 46 F.3d 426, 435 (5th Cir.)(use of summary

witness not reversible error where merely cumulative of substantive

evidence), cert. denied, 516 U.S. 833 (1995); United States v.

Winn, 948 F.2d 145, 157-58 (5th Cir. 1991) (use of summary chart

and testimony not reversible error where prejudice neutralized by

instruction), cert. denied, 503 U.S. 976 (1992). Even assuming the

admission of the summary testimony was clear or obvious error, the

error did not affect Fullwood’s substantial rights.

Nevertheless, in the light of the above-described dangers and

the seemingly increased use of such witnesses by the Government, we

strongly caution, once again, against use of summary witnesses in

this fashion, especially in a non-complex case. While such

witnesses may be appropriate for summarizing voluminous records, as

contemplated by Rule 1006, rebuttal testimony by an advocate

summarizing and organizing the case for the jury constitutes a very

different phenomenon, not justified by the Federal Rules of

Evidence or our precedent. For example, summary witnesses are not

to be used as a substitute for, or a supplement to, closing

argument.

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C.

Finally, Fullwood challenges the four-point enhancement he

received, pursuant to U.S.S.G. § 3B1.1, for being an organizer or

leader of the criminal activity. The presentence investigation

report (PSR) recommended the enhancement on the basis that Fullwood

was an organizer or manager in a criminal activity that, consistent

with the language of § 3B1.1, was otherwise extensive. Over

Fullwood’s objection, the district court imposed the enhancement,

finding Fullwood “did manage or supervise others in regard to this

commission of this offense, particularly in regard to his father-

in-law[,] his father[,] and also as to the adjustor....”

The pertinent portion of § 3B1.1 states:

Based on the Defendant’s role in the offense,

increase the offense levels as follows:

(a) If the defendant was an

organizer or leader of a criminal

activity that involved five or more

participants or was otherwise

extensive, increase by 4 levels.

(Emphasis added.)

In assessing whether an organization is

“otherwise extensive,” all persons involved

during the course of the entire offense are to

be considered. Thus, a fraud that involved

only three participants but used the unknowing

services of many outsiders could be considered

extensive.

U.S.S.G. § 3B1.1, cmt. n.3 (emphasis added). Fullwood claims the

enhancement was improper because his criminal activity did not

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involve the requisite five participants and was not “otherwise

extensive”.

The application of § 3B1.1 is a factual finding reviewed only

for clear error. E.g., United States v. Cabrera, 288 F.3d 163, 173

(5th Cir. 2002). “A factual finding is not clearly erroneous as

long as it is plausible in the light of the record as a whole.”

United States v. Powers, 168 F.3d 741, 752 (5th Cir.) (internal

quotation and citation omitted), cert. denied, 528 U.S. 945 (1999).

The Government does not contend the offense involved five or

more persons. Instead, as recommended by the PSR, it maintains the

enhancement is justified because Fullwood was the leader or

organizer of criminal activity that “was otherwise extensive”.

Along this line, the Government points to the involvement of

Jeffrey (the appraiser), Fullwood’s father and father-in-law, and

the following unwitting participants: USDA; RMA; FCIC; FSA; FSA,

Nolan County Office; Rayford Hargrove (insurance agent); Hargrove

Insurance Company; Fireman’s Fund Insurance Company; the United

States Postal Service; and private interstate carriers.

In the light of the use of these unknowing participants, the

“otherwise extensive” application was not clearly erroneous.

United States v. Davis, 226 F.3d 346, 360 (5th Cir. 2000), cert.

denied, 531 U.S. 1181 (2001), held that applying the § 3B1.1(a)

enhancement was not clearly erroneous because of the involvement of

unwitting accomplices where the defendant operated “an advance-fee

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scheme in which he would agree to obtain funding for clients, but

would never do so”. Id. at 348-49. There, the scheme involved

employees of a financial company, loan brokers, lawyers, and those

providing “due diligence” reports. Id. See also United States v.

Sidhu, 130 F.3d 644 (5th Cir. 1997) (§ 3B1.1 applied to physician

involved in healthcare fraud where patients and insurance company’s

employees were unknowing participants); United States v. Allibhai,

939 F.2d 244, 253 (5th Cir. 1991), cert. denied, 502 U.S. 1072

(1992) (§ 3B1.1 applied to scheme involving only four participants

that used services of outsiders such as bank employees). The use

of unsuspecting participants was similarly extensive here.

Application of the enhancement on that basis was not clearly

erroneous.

Fullwood also maintains, quite conclusionally, that his role

was not one of leader or organizer. The factors to be considered

are: (1) exercise of decision-making authority; (2) nature of

participation in the commission of the offense; (3) recruitment of

accomplices; (4) claimed right to a larger share of the fruits of

the crime; (5) degree of participation in planning or organizing;

(6) nature and scope of the illegal activity; and (7) degree of

control or authority exercised over others. U.S.S.G. § 3B1.1, cmt.

n.4.

Fullwood: chose which false claims to submit; prepared,

signed, and submitted those claims; introduced Jeffrey to his

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father and father-in-law, presumably to bring them in on the

scheme; took 95 percent of the profits (all but the five percent

kickback); and, as stated, utilized the services of countless

outsiders. Finding him to be a leader or organizer was not clearly

erroneous.

We caution, however, that this case arguably comes close to

the lower limits, for § 3B1.1 purposes, for what constitutes an

organizer or leader of criminal activity that was otherwise

extensive. The enhancement is designed to assign greater

punishment to those engaged in leading criminal enterprises, in

part because of concerns about relative responsibility. See

U.S.S.G. § 3B1.1 cmt. It is to be imposed against defendants who

tend to profit more from criminal enterprises, pose a greater

danger to the public, and are more likely to recidivate. Id.

Obviously, it is not a plea bargaining tool; likewise, it is not to

be applied automatically.

III.

For the foregoing reasons, Fullwood’s conviction and sentence

are

AFFIRMED.

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