Appendix — Sellers v. United States

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APPENDIX A — ORDER OF THE UNITED STATES

COURT OF APPEALS FOR THE FIFTH CIRCUIT

DATED AND FILED JUNE 30, 2000

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 99-31294

USDC No. 93-CR-327-2-C

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

v.

ROBERT DUPRE,

Defendant-Appellant.

Consolidated with

No. 99-31295

USDC No. 93-CR-327-1-C

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

v.

_ W. HAROLD SELLERS,

Defendant-Appellant.

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Appendix A

Appeal from the United States District Court

for the Eastern District of Louisiana

ORDER:

After federal prisoners Robert Dupre and W. Harold

Sellers (“the appellants”) filed an unsuccessful 28 U.S.C.

§ 2255 motion, the district court granted a certificate of

appealability (“COA”) enabling them to appeal certain

specified issues. Dupre and Sellers now seek an expanded

COA to appeal the following claims, which were not certified

by the district court: 1) the application of United States v.

Wells, 519 U.S. 482 (1997), to their case on direct appeal

violated the Ex Post Facto Clause; 2) venue was improper

on the money-laundering counts of the indictment;

3) cumulative errors regarding the Government’s misconduct

at trial invalidated their convictions; 4) the sentencing judge

misapplied the sentencing guidelines; and 5) the trial court

improperly instructed the jury. They also assert that the

district court erred in failing to hold an evidentiary hearing.

The appellants have failed to make a substantial showing

of the denial of a constitutional right. See 28 U.S.C.

§ 2253(c)(2). Accordingly, their request for an expanded

COA is DENIED. The clerk of this court is directed to issue

a briefing notice enabling the Government to respond to the

appellants’ brief on the certified issues.

Sellers’ motion for leave to file a supplemental brief,

seeking to “amplify” the arguments raised in the appellate

brief, is DENIED. See Fed. R. App. P. 28(j); 5th Cir. R.

28.5. The appellants’ motion to expedite appeal is also

DENIED.

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Appendix A

COA DENIED; MOTIONS TO SUPPLEMENT AND

EXPEDITE DENIED; ISSUE BRIEFING NOTICE.

s/ E. Grady Jolly

E. GRADY JOLLY

UNITED STATES CIRCUIT

JUDGE

4a

APPENDIX B — ORDER AND REASONS AND

JUDGMENT OF THE UNITED STATES DISTRICT

COURT FOR THE EASTERN DISTRICT OF

LOUISIANA DATED AND FILED JULY 7, 1999

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF LOUISIANA

CIVIL ACTION

NO. 93-327

SECTION “C”

UNITED STATES OF AMERICA

VERSUS

W. HAROLD SELLERS & ROBERT DUPRE

ORDER AND REASONS

The matter is before the Court on petitions by Harold

Sellers and Robert Dupre to vacate their convictions and

sentences pursuant to 28 U.S.C. § 2255 No evidentiary

hearing is necessary and for the following reasons, the

motions are DENIED’.

The defendants raise numerous issues concerning the

trial and sentencing. Each are considered below.

1. The Court treats all of Sellers’ claims as adopted by Dupre

and vice versa. To the extent they are separately argued, they are

separately identified.

Sa

Appendix B

Prosecutorial Misconduct — Intimidation/Inducement

of Government Witnesses (Dupre 1(a)(b))?; Sellers

VI(A)(1-4))

Dupre/Sellers claim that co-defendant Michael Barrack

and government witness John Ohanian were improperly

induced to testify through promises of leniency from the

government, in violation of 18 U.S.C. § 201. In addition,

they allege that Ohanian was induced/intimidated into~

pleading guilty to 18 U.S.C. § 215, an offense of which he

could not have been legally convicted as he was not an

“agent” of a financial institution.

The defendants acknowledge that the Fifth Circuit has

rejected the argument that prosecutors violate 18 U.S.C.

§ 201 when they confect plea agreements with potential

government witnesses. United States v. Haese, 162 F.3d 359

(Sth Cir. 1998), cert. denied, _ U.S. __, 119 S.Ct. 1795

(1999). Dupre correctly notes that the underlying assumption

of Haese is that the government is procuring “truthful”

testimony when it tenders leniency, an assumption about

which this Court has doubts, but which has been nonetheless

generally accepted by the Fifth Circuit. Dupre attempts to

distinguish Haese on the basis that in this case the

government pressured Ohanian into testifying falsely that

he was an “agent” of Oak Tree Savings Bank. The Fifth

2. The Court is referencing Dupre’s Memorandum. His Motion

lists the claimed errors in a different order.

3. Since the Fifth Circuit perceives no impropriety in such

agreements, there is no plain error in allowing the related testimony

into evidence (Sellers VI(4)).

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Appendix B

Circuit has previously held on Dupre’s direct appeal that the

evidence was sufficient to establish that Ohanian acted as

an agent of Oak Tree Savings Bank. This Court agrees*. Since

the evidence was sufficient to establish Ohanian’s agency

relationship with Oak Tree Savings Bank, any testimony to

that effect was not false.* As a result, the plea agreement

reached with Ohanian is valid under Haese.

Suppression of Brady Material (Sellers V1(B))_

Sellers alleges the government suppressed exculpatory

material, most particularly a 1989 Oak Tree Savings Bank

examination report and other work papers of government

witness Ernie Vossler. This issue was previously raised in

the defendant’s Motion for New Trial. It is reurged in

conjunction with the defendant’s other allegations of

government overreaching, such as the alleged improper plea

agreement with Ohanian. The argument is rejected for the

reasons stated in the Court’s ruling on the Motion for New

4. Dupre relies upon principles of corporate law seeking to

distance Ohanian from Oak Tree Savings Bank. Regardless of

whether Ohanian also was an employee/officer/agent of Landmark

Land of California, the evidence was sufficient to show that he was

also acting on behalf of Oak Tree Savings Bank.

5. Dupre also argues that a federally insured financial

institution was not involved in the transaction, claiming that the

dealings were between LaJolla on the one hand and Landmark Land

Corporation and Oak Tree Mortgage Corporation on the other,

neither of which were federally insured (1(c)). A variation of this

same argument was made on direct appeal in challenging the venue

for the trial. Based on the same evidence cited there, federally insured

Oak Tree Savings Bank was clearly the party disbursing the loan.

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Appendix B

Trial as well as the reasoning herein and hereafter regarding

the propriety of the government’s conduct.

Intimidation of Defense Witness (Dupre 2; Sellers VI(C))

Dupre/Sellers intended to call former Louisiana Banking

Commissioner Ken Pickering as an expert witness on the

laws and regulations regarding banking institutions. Prior

to his testifying, the government advised that he was under

federal investigation for unrelated matters which might to

be used to impeach him on cross-examination. The Court

reviewed the basis for the government’s proposed cross-

examination and informed Pickering of his possible exposure

to questioning. Pickering elected not to testify. Dupre/Sellers

allege this was improper intimidation and imply that because

Pickering was not subsequently indicted, the claim of other

investigations was bogus. This issue was raised during the

trial and also on appeal. As then, this Court finds that the

other investigations were bona fide and were not confected

in order to dissuade Pickering from testifying. While the

Court does not doubt the government made the disclosure to

discourage Pickering from testifying, the disclosure was

of factually correct information, namely the ongoing

independent investigation. Indeed, bad the government not

made the disclosure and simply waited until cross-

examination to confront Pickering with the impeachment

evidence, the defense may well have accused the government

of impropriety for sandbagging the witness unfairly.

The Court finds that none of the alleged efforts, singly

or cumulatively, justify vacating the conviction (Sellers

VI(D)).

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Appendix B

Improper Venue (Sellers VII)

Sellers claims that the Eastern District of Louisiana was

an improper venue for the money laundering counts of the

indictment, citing United States v. Cabrales, 524 U.S. 1

(1998). In Cabrales, the high court decided that the proper

venue for the money laundering count involved in that ease

was where the money was laundered as opposed to where

the underlying crime occurred. However, the defendant in

that case had had no involvement in the underlying offense.

Rather, the defendant’s sole involvement was in another

jurisdiction in assisting with the laundering of the funds. The

Supreme Court noted, however, that a continuing offense

might be involved, triable in more than one place, if the

launderer had acquired the funds in one district and

transferred them to another. In this case, Sellers was

convicted of acquiring the funds from a Louisiana financial

institution, through fraud and false statements, then

laundering them in another jurisdiction. This constitutes a

continuing type offense, triable in Louisiana as well as other

jurisdictions.

Sentencing Guidelines — Money Laundering —

“Heartland” (Dupre 3; Sellers VITI(A)(1))

Dupre/Sellers claim that a downward departure from the

sentencing guidelines is warranted because the money

laundering offenses fall outside the “heartland” of money

laundering crimes. The Court views the laundering of money

obtained in large scale frauds such as this one to fall within

the “heartland” of money laundering crimes, even if drug

trafficking and organized crime are not involved.

A downward departure was not warranted.

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Appendix B

Sentencing Guidelines — Overstated Loss (Sellers

VII(A)(2))

Sellers argued that the loss calculation for the Sentencing

Guidelines was too harsh, and that multiple external factors

caused the loss. The loss calculation, however, was based

solely on the amount of money the defendants improperly

siphoned off and laundered. The Court finds no error in using

those figures as the basis for the calculations.

Sentencing Guidelines — Intent to Repay (Sellers

VII(A)(3))

Sellers argues that a downward departure from the

Sentencing Guidelines is warranted because of his alleged

intent to repay the Oak Tree Savings Bank loan. The Court

accepts, for purposes of argument, that had business gone

on as usual, Sellers would have ultimately repaid the loan in

some fashion in order to continue his questionable operations.

That intention, however, does not negate the fact that he

fraudulently obtained substantial funds for his own use from

the loan. No downward departure is justified.

Sentencing Guidelines — Cumulative Factors (Sellers

VII(A)(4))

Sellers cites various factors he argues justifies a

‘downward departure, including the time already spent in

prison, disbarment and payment of the restitution. These

factors do not justify a downward departure in this case.

10a

Appendix B

Structural Errors — Jury Instructions — “Risk of Loss”

(Sellers IX(A)(1))

Sellers cites a number of alleged errors in the jury

instructions, to which he did not object at time of trial. As a

result, to warrant reversal, the errors must be so serious as

to make the decision of guilt unreliable. United States v.

Olano, 507 U.S. 725 (1993). Such an error is a “structural”

error since it underlines the validity of the trial itself.

Sellers alleges such error in the Court’s instruction on

bank fraud, specifically its failure to elaborate on the meaning

of “risk of loss.”

Sellers has failed to cite any case, and the Court has

failed likewise to find any ease, in which this jury instruction

was found to be inadequate. Courts routinely cite “risk of

loss” as an aspect of a bank fraud charge without any

elaboration. See, for example, United States v. Holley,

23 F.3d 902 (Sth Cir.), cert. denied, 513 U.S. 1083 (1994);

United States v. Barakett, 994 F.2d 1107 (Sth Cir. 1993),

cert. denied, 510 U.S. 1049 (1994). The cases cited by Sellers

all deal with motions for judgment of acquittal, not

challenges to the jury instructions. As already noted by the

Fifth Circuit and concurred in by this Court, the evidence

here was more than sufficient to sustain the bank fraud

convictions.

The Court finds no error in the instruction, much less a

structural error.

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Appendix B

2. Structural Errors — Jury Instructions — ‘Failure

to Disclose” (Sellers [X(A)(2))

Sellers claims the Court failed to define how criminal

liability could arise from a failure to disclose, arguing that

the jury could have found him guilty without finding that he

knew of the information that should have been disclosed.

The Court did not give an express “failure to disclose”

instruction. The Court did however advise the jury of what

the specific allegations of the government were — with

respect to Count 4, that the defendants misrepresented the

purchase price of a parcel of land; Count 5, they misrepresented

the amount needed to refinance a loan and Count 6, they

misrepresented the intended use of release collateral. The

Court also instructed the jury that an element of the offense

was making statements knowing that they were false. Finally,

the Court gave a theory of the defense instruction, which

had been submitted by the defense, -and also a good faith

instruction.

The Court finds no error in the jury instructions with

regard to the issue of failure to disclose, much less structural

error.

3. Structural Errors — Jury Instruction — Fiduciary

Duty (Sellers X(A)(3))

Sellers contends that the jury instructions allowed the

jury to convict Sellers on the sole basis of breach of a

fiduciary relationship without a showing of a tangible harm.

He cites in support several cases dealing with persons who

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Appendix B

did occupy specific fiduciary obligations toward other

parties.

This case did not involve breach of a special fiduciary

obligation and the Court doubts the word even appears in

the jury instructions. The defendants were convicted, in

essence, of ripping off Oak Tree Savings Bank by, in part,

misrepresenting the monies that were needed to refinance a

loan and to purchase the Upper Etiwanda properties. Oak

Tree Savings Bank was harmed at the time by expending

monies that it could have invested elsewhere had they not

been deceived.

That the Bank ultimately — and fortuitously — recouped

its money does no absolve the defendants of their criminal

conduct.

The Court finds no error, much less structural error, in

the jury instructions on this issue.

4. Structural Errors — Jury Instruction — Fraudulent

Intent (Sellers X(A)(4))

Sellers cites alleged error in failing to instruct the jury

that in order to have fraudulent intent, Sellers had to intend

some actual harm or injury to Oak Tree Savings Bank.

The jury was specifically advised that in order to convict

the defendants, the jury had to find that they intended to

commit fraud and intended to defraud Oak Tree Savings

Bank. Intent to defraud was defined and a good faith

instruction was given, as well as a theory of the defense.

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Appendix B

As noted above, the defendants intended to take from

Oak Tree Savings Bank, by fraud and deceit, money

belonging to Oak Tree Savings Bank to which the defendants

were not entitled. This was the theory of the government’s

case and the evidence supported it.

The Court finds no flaw in the jury instructions, much

less structural error.

5. Structural Errors — Jury Instruction — Materiality

— False Statements (Sellers X(A)(5))

Sellers claims structural error in the failure of the Court

to submit the issue of “materiality” to the jury with respect

to the false statement counts. 18 U.S.C. § 1014.

At the time of trial, binding Fifth Circuit precedent

dictated that materiality was an element of a Section 1014

violation but that it was an issue of law to be decided by the

judge, not the jury. Subsequent to Sellers’ conviction, and

while his case was on appeal, the United States Supreme

Court held that “materiality” was an element of an 18 U.S.C.

§ 1001 violation and as an element of the offense, had to be

given to the jury to decide. United States v. Gaudin, 515

U.S. 506 (1995). Sellers assumes that Gaudin likewise

required that the issue of materiality be submitted to the jury

in an 18 U.S.C. § 1014 charge.

The Court finds that Sellers assumes too much. Gaudin

dealt with a different false statement statute which,

significantly, expressly required that the falsification or

concealment concern a “material” fact. This clear language

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Appendix B

led the unanimous court to conclude that it was an element

that the jury needed to decide. Sellers was convicted under

18 U.S.C. § 1014, which contains no such requirement that

the false statement concern a material fact. Gaudin’s

rationale, therefore, is simply inapplicable. This was made

clear in United States v. Wells, 519 U.S. 482 (1997), just

two years after Gaudin, where the same court, by a 8-1

decision, held that materiality was not an element of an

18 U.S.C. § 1014 violation. The high court’s rationale

included the fact that the statute itself made no mention of

materiality.

On direct appeal, the Fifth Circuit rejected Sellers’

argument on the basis of Wells. Sellers complains that the

Fifth Circuit inappropriately applied Wells to retroactively

overrule Gaudin. He cites United States v. Marks, 430 U.S.

188 (1977) and United States v. Cabrera-Teran, 168 F.3d

141 (Sth Cir. 1999), in support. This Court concludes, for

the reasons stated above, that Gaudin was and is simply

inapplicable to a Section 1014 violation. Consequently, under

the prevailing Fifth Circuit law at the time of Sellers’ Section

1014 violations and at the time of his trial, the issue of

materiality was not for the jury to decide. At the time of

Sellers’ appeal, the issue of materiality had been eliminated

by the United States Supreme Court entirely as an element

of a Section 1014 offense.

The jury instructions as to materiality with regard to the

false statements counts, even though arguably technically

erroneous in light of Wells, were not prejudicial and do not

constitute structural error.

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Appendix B

Structural Errors — Conspiracy (Sellers First

Supplement (1))

Sellers argues that since the instruction as to false

statements was erroneous for failing to give the issue of

materiality to the jury, the conspiracy count is likewise

flawed since it included the false statement charges. Since

the Court finds no prejudicial error in the instruction given

in the 18 U.S.C. § 1014 counts, no prejudicial error occurred

in the conspiracy count on that basis.

Structural Errors — Bank Fraud (Sellers First

Supplement (2) & Correspondence of 6/22/99)

Sellers argues that the Court’s instruction regarding the

bank fraud counts was erroneous because it failed to charge

the jury that they had to find “materiality” in the defendants’

fraudulent conduct. He cites the recent United States

Supreme Court decision, Neder v. United States, _ US.

__, 119 S.Ct. 1827 (1999), which held that materiality is an

element of bank fraud, 18 U.S.C. § 1344. As a matter of

substantive law, such a holding is retroactive to cases on

collateral review. United States v. Marcello, 876 F.2d 1147

(Sth Cir. 1989); United States v. McPhail, 112 F.3d 197 (Sth

Cir. 1997). Presupposing for purposes of this ruling that the

Olano, supra, analysis of plain error is appropriate for

collateral review, the Court agrees that the failure to include

materiality as an element for the jury to decide in the bank

fraud counts was error under Neder. The Court also assumes

for purposes of this ruling that even though the error was

not clear or obvious at the time of trial, nor upon direct

appeal, that it is sufficient if it is clear or obvious now, on

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Appendix B

collateral review. The next question is whether the error

affected the substantial rights of the defendant. The Court

finds that failing to instruct the jury as to an essential element

of an offense affects the substantial rights of the defendant.

The last consideration is whether the forfeited error

“seriously affects(s) the fairness, integrity or public

reputation of judicial proceedings.” Olano, 507 U.S. at 736.

This last factor is the most difficult. This Court candidly

sides with the dissenters in Neder who contended that the

failure to submit an essential element of a crime to the jury

for consideration should never be viewed as harmless error.

Theirs was the minority view, however. The majority held

that the defective instruction was subject to harmless error

review. The Court found the error to be harmless in Neder’s

case because materiality was not a contested issue at trial

and the evidence of materiality in fact was overwhelming.

In this case, materiality was the issue at trial. The defense

was that the agents of Oak Tree Savings Bank relied entirely

upon their own analysis, appraisals and conclusions with

respect to the financial transactions in question and not upon

the representations by the defendants. The defense theory,

in a nutshell, was that Oak Tree Savings Bank’s

representatives made their own independent decision as what

the projects were worth and as long as the defendants’

demand fell within that range, the transactions would be

approved, regardless of any other information provided by

the defendants.

On the other hand, the evidence supporting the defense

theory was weak. A false statement is material if it has

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Appendix B

“a natural tendency to influence, or (is) capable of

influencing, the decision cf the decision making body to

which it was addressed.” Gaudin, 515 U.S. at 509. The

unquestionably false representations made by the defendants

certainly had a tendency to influence or be capable of

influencing the decision of Oak Tree Savings Bank to

approve the full amount of the loan and later approve the

partial withdrawal of the collateral to the loan. It is not

necessary that Oak Tree Savings Bank rely solely on the

defendants’ misrepresentations in approving the transactions,

only that the misrepresentations play an influential part. The

defendants cannot plausibly argue, for example, that Oak

Tree Savings Bank would have approved loaning them $55.8

million to refinance the Lomas loan had it known that Lomas

had discounted the debt by $3 million discount, so that $52.8

million was actually owed. While the transaction may well

have been attractive enough to Oak Tree Savings Bank to

fund the higher amount, if it found to be necessary to close

the transaction, it does not follow that they would have

chosen to simply pour another $3 million into the defendants’

pockets as lagniappe had they known the truth. No juror could

reasonably come to that conclusion. Hence, the

misrepresentations were material. The same conclusion

applies to the misrepresentations regarding the use of the

withdrawn collateral.

Under the standard of review called for by binding

jurisprudence, the failure of the Court to instruct the jury

that materiality was an essential element of the bank fraud

counts was neither plain nor structural error.

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Appendix B

Accordingly,

IT IS ORDERED that the motion to vacate sentence

pursuant to 28 U.S.C. § 2255 filed by W. Harold Sellers and

the motion to vacate conviction pursuant to 28 U.S.C. § 2255

filed by Robert Dupre are DENIED.

New Orieans, Louisiana, this 7 day of July, 1999.

s/ Helen G. Berrigan

HELEN G. BERRIGAN

UNITED STATES DISTRICT

JUDGE

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Appendix B

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF LOUISIANA

CRIMINAL ACTION

NO. 93-327

SECTION: C

REF: C.A. 99-0428

UNITED STATES OF AMERICA

VERSUS

W. HAROLD SELLERS

JUDGMENT

Considering the order and reasons on file and entered

by the Court herein denying the motion filed by petitioner

W. Harold Sellers to vacate sentence pursuant to 28 U.S.C.

§2255, accordingly;

IT IS ORDERED, ADJUDGED AND DECREED that

the motion to vacate sentence pursuant to 28 U.S.C. §2255

is hereby DENIED.

New Orleans, Louisiana, this 7 day of July 1999.

s/ Helen G. Berrigan

HELEN G. BERRIGAN

UNITED STATES DISTRICT

JUDGE

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APPENDIX C — ORDER AND REASONS OF THE

UNITED STATES DISTRICT COURT FOR THE

EASTERN DISTRICT OF LOUISIANA DATED AND

FILED SEPTEMBER 24, 1999

‘UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF LOUISIANA

CIVIL ACTION

NO. 93-327

SECTION “C”

UNITED STATES OF AMERICA

VERSUS

W. HAROLD SELLERS & ROBERT DUPRE

ORDER AND REASONS

The matter is before the Court on motions filed by Harold

Sellers and Robert Dupre for reconsideration the denial of

their motions to vacate their convictions and sentences

pursuant to 28 U.S.C. § 2255. The defendants’ motions for

reconsideration, filed as original motions, with three

supplements, are DENIED for the reasons previously stated

and for the following additional reasons.

In ruling on the defendants’ original motion to vacate

the sentence, this Court concluded that the holding of Neder

v. United States, 119 S.Ct. 1827 (1999), that materiality is

an element of bank fraud under 18 U S.C. §1344, is

retroactive to cases on collateral review because it dealt with

a matter of substantive law. In this regard, the Court likely

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Appendix C

erred. As noted on the original appeal in this case, the Fifth

Circuit had already previously required that the government

prove that statements made in a §1344 fraud charge be

material. United States v. Dupre, 117 F.3d 810, 815

(Sth Cir. 1997), cert. denied, 118 S.Ct. 857 (1998); see also

United States v. Campbell, 64 F.3d 967, 975 (Sth Cir. 1995);

United States v. Heath, 970 F.2d 1397, 1403 (Sth Cir. 1992),

cert. denied, 507 U.S. 1004 (1993); but see also United States

v. Henderson, 19 F.3d 917 (Sth Cir.), cert. denied, 513 U.S.

877 (1994). The change rendered by Neder was to affirm

that conclusion and to additionally require that the

determination of materiality be made by the jury, not the

judge.' This is similar to the change rendered by United States

v. Gaudin, 515 U.S. 506, 115 S.Ct. 2310, 132 L.Ed. 2d 444

(1995). In Gaudin, the Supreme Court held that since

materiality was an element in the offense of making a false

statement under 18 U.S.C. §1001, it was a question for the

jury, not the judge, to decide. In United States v. Shunk,

113 F.3d 31 (Sth Cir. 1997), the Fifth Circuit concluded that

Gaudin made a procedural and not a substantive change in

the law. The court held that Gaudin did not change what the

government must prove, since materiality had always been

an element of §1001, but simply changed the party to whom

the proof must be made — from judge to jury. Since this

was a procedural, not a substantive, change in the law, it

1. The Court does not recall making a determination of

materiality as to the bank fraud counts in this case specifically, but

the Court did find that the false statements made under the 18 U.S.C.

_ §1014 counts were material. Since the actual misrepresentations were

the same in the bank fraud and false statement counts, no prejudice

is shown by any failure to make a specific finding as to the bank

fraud counts. 3

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Appendix C

triggered an analysis under Teague v. Lane, 489 U.S. 288,

109 S.Ct. 1060, 103 L.Ed. 2d 334 (1989). Under Teague, a

new procedural rule is not retroactive to cases on collateral

review unless it falls into two narrow exceptions. The first

exception, dealing with certain kinds of private conduct, was

clearly inapplicable. The other exception allows for

retroactive application of new rules when they deal with

procedures “implicit in the concept of ordered liberty”;

“watershed rules of criminal procedure” that are “central to

an accurate determination of innocence or guilt.” Teague,

489 U.S. 307, 311, 313, 109 S.Ct. at 1073, 1076, 1077. The

Fifth Circuit then concluded that requiring the government

to prove materiality to the jury rather than the judge was not

a “watershed” rule of criminal procedure. Hence, the holding

of Gaudin, that materiality was a matter for the jury to decide,

rather than the judge, was not retroactive to cases on

collateral review. é

This matter comes before the Court on collateral review.

For the same reasons as in Shunk, the decision in Neder is

not retroactive to cases in this procedural posture.

While the Court has denied the defendants’ motion for

reconsideration, the Court does consider the issue sufficiently

new and undeveloped to warrant a Certificate of

Appealability to the Fifth Circuit.’

2. The Court does modify its prior ruling, however, as to the

issue of materiality, having erroneously designated it as “the” issue

in this case. While the issue of materiality was raised on appeal and

now on collateral review, the Court overstated its significance at

trial. The defense at trial, as set forth in a “Theory of the Defense”

(Cont'd)

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Appendix C

Accordingly,

IT IS ORDERED that the motions for reconsideration

filed by W. Harold Sellers and Robert Dupre are DENIED.

New Orleans, Louisiana, this 24th day of September,

1999. -

s/ Helen G. Berrigan

HELEN G. BERRIGAN

UNITED STATES DISTRICT

JUDGE

(Cont'd)

instruction given to the jury, was that (1) the defendants did not

have negotiations with, nor did they obtain a loan from, a federally

insured institution, and (2) the representations made by the

defendants to Oak Tree Savings Bank were made in good faith and

were believed by them to be true at the time. The Court also

instructed the jury in detail as to the defense of good faith.

Understandably, the issue of materiality was not emphasized since

at the time of trial, that issue was for the Court, not the jury, to

decide.

24a

APPENDIX D — ORDER OF THE UNITED STATES

COURT OF APPEALS FOR THE FIFTH CIRCUIT

DENYING MOTION FOR RECONSIDERATION

DATED AND FILED AUGUST 8, 2000

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 99-31294

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

versus

ROBERT DUPRE,

Defendant-Appellant.

No. 99-31295

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

v.

W. HAROLD SELLERS, ;

Defendant-Appellant.

Appeal from the United States District Court for the

Eastern District of Louisiana, New Orleans

-

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Appendix D

Before JOLLY, SMITH, and EMILIO M. GARZA, Circuit

Judges.

BY THE COURT:

A member of this panel previously denied the appellants’

motion for expanded certificate of appealability. The panel

has considered the appellants’ motion for reconsideration.

IT IS ORDERED that the motion is DENIED.

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APPENDIX E — RELEVANT STATUTES

18 U.S.C. § 1014

§ 1014. Loan and credit applications generally;

renewals and discounts; crop insurance

Whoever knowingly makes any false statement or report,

or willfully overvalues any land, property or security, for

the purpose of influencing in any way the action of. . . any

institution the accounts of which are insured by the Federal

Deposit Insurance Corporation, ... upon any application,

advance, discount, purchase, purchase agreement, repurchase

agreement, commitment, or loan, or any change or extension

of any of the same, by renewal, deferment of action or

otherwise, or the acceptance, release, or substitution of

security therefor, shall be fined not more than $1,000,000 or

imprisoned not more than 30 years, or both. ...

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Appendix E

18 U.S.C. § 1957

§ 1957. Engaging in monetary transactions in property

derived from specified unlawful activity

(a) Whoever, in any of the circumstances set forth

in subsection (d), knowingly engages or attempts to

engage in a monetary transaction in criminally derived

property of a value greater than $10,000 and is derived from

specified unlawful activity, shall be punished as provided in

subsection (b).

(f) As used in this section —

(1) the term “monetary transaction” means the deposit,

withdrawal, transfer, or exchange, in or affecting interstate

or foreign commerce, of funds or a monetary instrument

(as defined in section 1956(c)(5) of this title) by, through,

or to a financial institution (as defined in section 1956 of

this title), including any transaction that would be a financial

transaction under section 1956(c)(4)(B) of this title, but such

term does not include any transaction necessary to preserve

a person’s right to representation as guaranteed by the sixth

amendment to the Constitution; :

(2) the term “criminally derived property” means any

property constituting, or derived from, proceeds obtained

from a criminal offense; and

(3) the term “specified unlawful activity” has the

meaning given that term in section 1956 of this title.