1/16/25: Criminal forfeiture case

In United States v. Omidi, --- F.4th ---, 23-1959 (9th Cir. 2025), the Court  affirmed the district court’s forfeiture judgment of nearly $100 million in a case in which Julian Omidi and his business, Surgery Center Management, LLC (SCM), were convicted of charges arising from their “Get Thin” scheme in which Omidi and SCM defrauded insurance companies by submitting false claims for reimbursement.

Here, the government sought forfeiture of the proceeds of Omidi and SCM’s mail and wire fraud violations under 18 U.S.C. § 981(a)(1)(C) and 28 U.S.C. § 2461(c). While 18 U.S.C. § 981 governs civil forfeiture actions, 28 U.S.C. § 2461(c) “permits the government to seek criminal forfeiture whenever civil forfeiture is available and the defendant is found guilty of the offense[.]” United States v. Newman, 659 F.3d 1235, 1239 (9th Cir. 2011) (emphasis omitted), abrogated on other grounds by Honeycutt v. United States, 581 U.S. 443, 454 (2017). When applicable, such forfeiture is mandatory. Id. at 1240; 28 U.S.C. § 2461(c). If the government seeks forfeiture of specific property, such as the proceeds at issue here, it must establish “the requisite nexus between the property and the offense,” Fed. R. Crim. P. 32.2(b)(1)(A), by a preponderance of the evidence.

The question in this case is whether the district court erred in ordering the forfeiture of all Get Thin’s proceeds, even though conceivably some of the incoming funds ultimately paid for legitimate and medically necessary procedures. After a review of the relevant law and facts, we conclude that the district court got it right. 

[W]e follow our sister circuits to conclude that in a forfeiture case seeking proceeds of a fraud scheme under § 981(a)(1)(C), there is no so-called “100% Fraud Rule.” All proceeds directly or indirectly derived from a health care fraud scheme like Get Thin—even if a downstream legitimate transaction conceivably generated some of those proceeds—must be forfeited. The district court did not err in so concluding.

1/14/25: False answers to unlawful questions.

In United States v. Patnaik, --- F.4th ---, No. 23-10043 (9th Cir. 2025), the Court reversed the district court’s judgment dismissing an indictment charging the defendants with submitting fraudulent H-1B visa applications, and remanded for reinstatement of the criminal charges.

Before the district court, Defendants asserted that these allegedly false statements could not be materially false statements because it was unlawful for the government to ask for such information under ITServe All., Inc. v. Cissna, 443 F. Supp. 3d 14 (D.D.C. 2020). The district court accepted Defendants’ argument and granted their motion to dismiss the indictment. 

Yet, under longstanding principles, the government may protect itself against “those who would swindle it” even if the government demanded answers to questions it had no right asking. See United States v. Kapp, 302 U.S. 214, 218 (1937). So lying on H-1B visa applications remains visa fraud even when the lies were given in response to questions the government can’t legally ask—as long as the misrepresentations could have influenced USCIS at the time they were made. We thus reverse. 

This case turns on the element of materiality. A visa-application statement is material if it “could have affected or influenced the government’s decision to grant th[e] petition[].” United States v. Matsumaru, 244 F.3d 1092, 1101 (9th Cir. 2001). Materiality is assessed “at the time the alleged false statement was made” and “[l]ater proof that a truthful statement would not have helped the decision-making body does not render the false [statement] immaterial.” United States v. McKenna, 327 F.3d 830, 839 (9th Cir. 2003) (simplified).

The indictment sufficiently alleges a material misrepresentation. By law, H-1B petitioners must “establish that the H-1B beneficiary employees would fill specific, bona fide positions that were available at the time [the petitioner] filed the petitions, and that there was, or would be, a legitimate employer-employee relationship between [the petitioner] and the H-1B beneficiaries.” See Prasad, 18 F.4th at 316. Accurate information on where and for whom the H-1B beneficiaries will work could affect or influence the decision to grant the H-1B visa petition. See Matsumaru, 244 F.3d at 1101. Thus, a jury could find Defendants’ alleged false statements material. 

The principle that the government may punish untruthful responses to unlawful questions as fraud goes back to the Supreme Court’s 1937 Kapp decision. Since then, the Court’s cases “have consistently—indeed without exception—allowed sanctions for false statements or perjury; they have done so even in instances where the perjurer complained that the Government exceeded its constitutional powers in making the inquiry.” 

12/30/24: Two decisions today

In United States v. DeFrance, --- F.4th ---, No. 23-2409 (9th Cir. 2024), the Court reversed Michael Blake DeFrance’s conviction for violating 18 U.S.C. § 922(g)(9), which forbids the possession of firearms by anyone convicted of a “misdemeanor crime of domestic violence,” vacated his sentence, and remanded.

We address whether a conviction for partner or family member assault (PFMA) under Montana Code Annotated section 45-5-206(1)(a) qualifies as a “misdemeanor crime of domestic violence” for purposes of 18 U.S.C. § 922(g)(9). Because Montana’s PFMA statute can be violated by inflicting emotional rather than physical injury, we conclude that it does not “ha[ve], as an element, the use or attempted use of physical force.” 18 U.S.C. § 921(a)(33)(A)(ii). Accordingly, a conviction for violating this statute does not qualify as a “misdemeanor crime of domestic violence,” and Appellant’s § 922(g)(9) conviction must be reversed.

Here, our conclusion that section 45-5- 206(1)(a)’s overbreadth is evident from its text considers the statute’s language as well as Montana case law. Because Montana’s courts have the final say in construing Montana assault statutes, the similarities between the words of the Tennessee and Montana statutes do not foreclose our conclusion that the Montana statute is materially broader. Indeed, as interpreted by Castro, Montana case law compels the conclusion that the use of physical force is not an element of 45-5-206(1)(a), because the statute may be violated by inflicting only emotional injury.

Next, in United States v. In, --- F.4th ---, No. 23-2917 (9th Cir. 2024), the Court reversed the district court’s order granting Larry Seng In’s motion to suppress a gun found in his car during a traffic stop, and remanded for trial.

Larry Seng In (“In”) was charged in a federal indictment with being a felon in possession of a firearm in violation of 18 U.S.C. §§ 922(g)(1) and 924(a)(2) after a gun was found in his car during a traffic stop. In moved to suppress the gun in district court, contending that it was obtained as a result of an unlawful de facto arrest. In did not challenge the officers’ initial traffic stop as an unlawful Terry stop. Instead, In argued that the officers’ actions, in particular their decision to handcuff him, escalated a valid Terry stop into an unlawful de facto arrest because the officers handcuffed him before they had probable cause to believe that he was prohibited from possessing the gun.

The district court rejected the magistrate judge’s recommendation and granted In’s motion to suppress, holding that the gun was obtained as a result of an unlawful de facto arrest without probable cause. The United States (“the Government”) moved for reconsideration, and the district court denied the motion. The Government appealed the district court’s order granting In’s suppression motion, and we now must decide whether the traffic stop became a de facto arrest. We have jurisdiction under 18 U.S.C. § 3731. We hold that the traffic stop did not turn into a de facto arrest, and we reverse the district court. 

In this case, the officers’ decision to handcuff In made the traffic stop more intrusive than a typical Terry stop, but the use of handcuffs was reasonable under the circumstances and did not convert the stop into an arrest.

Because the officers were patrolling on bicycles, they could not place In inside a patrol car while conducting their investigation. If the officers had not handcuffed In, they would have had to rely on their ability to physically overpower In if he attempted to reach for the gun that was visible and loose on the floor of the backseat of the car. Although In did not actually reach for the exposed gun, the question is whether officers had a sufficient basis to fear for their safety to warrant the intrusiveness of the actions taken.  Considering the totality of the circumstances, we hold that the officers had a sufficient and reasonable basis to fear for their safety, justifying their decision to handcuff In so that their safety was assured during their investigation. The officers had good reason to handcuff In to prevent him from being able to access the unsecured gun on the floor of the backseat. The officers were eliminating the possibility that In could gain access to the unsecured gun. That conduct properly protected both the officers and the general public. And this is true even though Nevada is an open carry state. See Nev. Const. art. I, § 11. Because the officers’ conduct was reasonable under the circumstances, the Terry stop did not escalate into a de facto arrest without probable cause. 

12/26/24: Case on prior inconsistent statement under Fed. R. Evid. 801(d)(1)(A)

In United States v. Shuemake, --- F.4th ---, No. 22-30210 (9th Cir. 2024), the Court affirmed Joshua Shuemake’s conviction for obstruction of justice in a case in which the district court admitted his friend Luke Ulavale’s grand jury testimony implicating Shuemake after Ulavale tried to backtrack at trial claiming memory loss.

Under the prior inconsistent statement rule of the Federal Rules of Evidence, a district court can admit an earlier sworn statement if a witness on the stand contradicts that statement. FED. R. EVID. 801(d)(1)(A). But can a court admit a prior statement if a witness claims at trial that he does not remember saying it? We hold that a feigned lack of recollection may fall within Rule 801’s prior inconsistent statement provision. We thus reject Joshua Shuemake’s argument that the district court erred in admitting his friend’s grand jury testimony implicating Shuemake after he tried to backtrack at trial by claiming memory loss. Shuemake’s conviction for obstruction of justice is affirmed.

To be clear, we do not hold that a court can admit earlier sworn testimony as a prior inconsistent statement merely because a witness asserts that he cannot recall that prior statement. After all, a witness genuinely may not remember his earlier testimony; in that case, a lawyer can rely on other evidentiary rules such as refreshing the witness’ recollection (Rule 612) or using the recorded recollection exception to the hearsay rule (Rule 803(5)). Under the prior inconsistent statement rule, the dispositive inquiry is whether both the trial testimony and the prior testimony could be equally truthful when asserted. In making this assessment, trial courts can consider various factors—such as (i) inexplicable or questionable explanations for the lack of recollection, (ii) vague and evasive responses suggesting a refusal to answer truthfully, and (iii) potentially conflicting testimony—as signs that a witness is feigning memory loss. Courts must engage in this fact-intensive inquiry to smoke out a witness’ attempt to walk away from prior sworn testimony by asserting a lack of memory.

12/19/24: Government appeal of selective prosecution discovery order

In United States v. Wilson, --- F.4th ---, No. 23-50016 (9th Cir. 2024), the Court reversed the district court’s selective-prosecution discovery order, reversed the district court’s order dismissing without prejudice an indictment charging Defendants with arson, and remanded for further proceedings. 

Defendants moved to dismiss their indictment, arguing that they were unconstitutionally singled out for prosecution based on the perception that they held anti-government views. Alternatively, Defendants sought discovery on their selective-prosecution claim. The district court denied Defendants’ motion for dismissal but granted them discovery regarding selective prosecution. But after the Government indicated that it would seek appellate review rather than produce the ordered discovery, the district court dismissed the indictment without prejudice.

The first issue that we must resolve is whether we have jurisdiction.

In criminal cases, we have jurisdiction over Government appeals from three types of decisions: (1) an order “dismissing an indictment or information or granting a new trial after verdict or judgment” unless double jeopardy has attached; (2) an order “suppressing or excluding evidence or requiring the return of seized property” made before jeopardy has attached or a verdict rendered; and (3) orders “granting the release of a person charged with or convicted of an offense, or denying a motion for revocation of, or modification of the conditions of, a decision or order granting release.” 18 U.S.C. § 3731. Congress instructs us to “liberally construe[]” these provisions.

Although this case seems to fall into the first category because the Government appeals the district court’s order dismissing Defendants’ indictment without prejudice, Defendants argue that we lack jurisdiction. Defendants assert that § 3731 cabins the statutory authorization to appeal to only final judgments and that the Government manufactured “review of an otherwise non-appealable [discovery] order that is not specifically listed in § 3731” in a way that raises “serious constitutional and prudential problems.”

Nothing in the text of § 3731 indicates that appellate jurisdiction exists only for final decisions or orders. This contrasts with the statute governing appellate jurisdiction in civil cases, which does limit our jurisdiction to appeals “from all final decisions of the district courts.” 28 U.S.C. § 1291. And as the Seventh Circuit recounted, the plain language of § 3731 makes multiple non-final decisions appealable. Thus, § 3731 is “a statutory exception to the final judgment rule.”

This is not a close call; we have jurisdiction over this appeal.

We review for an abuse of discretion a district court’s determination that the defendant has made the requisite showing to obtain discovery on a claim of unconstitutional selective prosecution. Id. at 851–52. “The court necessarily abuses its discretion when it applies the wrong legal standard.” 

Given the separation-of-powers concerns at play, the standard for proving selective prosecution is “a demanding one.” The Supreme Court has established a two-factor standard: the defendant must demonstrate “clear evidence,” first that the decision to prosecute “had a discriminatory effect and[, second,] that it was motivated by a discriminatory purpose.”  “[T]he showing necessary to obtain discovery” on a selective-prosecution claim is “correspondingly rigorous,” and is intended to be a “significant barrier to the litigation of insubstantial claims,” id. at 464. A defendant seeking “discovery on a claim of selective prosecution must show some evidence of both discriminatory effect and discriminatory intent.” Here, the district court correctly articulated this governing test but erred in applying it.

To show discriminatory effect sufficient to warrant discovery, a defendant must “produce some evidence that similarly situated defendants . . . could have been prosecuted, but were not.”

Following Armstrong and Turner, we resolve this case on the discriminatory-effect factor alone and decline to address whether Defendants presented evidence of discriminatory intent. Because Defendants failed to meet their burden to produce some evidence that similarly situated individuals could have been prosecuted but were not, we reverse the district court’s selective-prosecution discovery order and its dismissal of the Defendants’ indictment without prejudice, and we remand for further proceedings consistent with this opinion.

12/18/24: Case about intended loss under the prior version of U.S.S.G. § 2B1.1(b)(1)(I)

In United States v. Hackett, --- F.4th ---, No. 22-50142 (9th Cir. 2024), a divided Court affirmed the district court’s judgment in a case in which Andrew Hackett, a stock promoter, was convicted and sentenced for conspiracy to commit securities fraud and securities fraud in connection with the manipulative trading of a public company’s stock.

The district court imposed a 16-level sentencing enhancement under the pre-November 1, 2024, version of U.S.S.G. § 2B1.1(b)(1)(I), which applies if the loss exceeds more than $1.5 million.  In doing so, the court relied on intended loss, rather than actual loss.

Hackett argued on appeal that the district court erred by following the commentary to § 2B1.1, which defines “loss” as the “greater of actual loss or intended loss.” U.S.S.G. § 2B1.1 cmt. n.3(A).

The majority reviewed for plain error because Hackett’s objection to the district court’s loss calculation was not sufficiently specific to preserve de novo review.  The majority held that the district court’s reliance upon the definition of “loss” set forth in the commentary withstood plain error review because any error was not clear or obvious given this court’s precedent recognizing both actual and intended loss, and because there is a lack of consensus among the circuit courts on this issue.

In a cogent dissent, Judge Berzon explained why the majority was wrong. 

12/4/24: Three decisions today

The Ninth published three criminal decisions today.  

In United States v. Knight, --- F.4th ---, No. 23-962 (9th Cir. 2024), the Court affirmed a special condition of supervised release restricting the defendant's viewing or use of pornography following his conviction for child pornography possession. The Court rejected the argument that the condition was impermissibly overbroad to the extent it did not exempt use of such materials for purposes of asserting a future collateral challenge to the defendant's conviction and sentence. The Court rejected this contention because, unlike in Cope, the condition imposed on the defendant applied only to visual depictions of pornography and not to materials that merely describe child pornography.

In United States v. Abouammo, --- F.4th ---, No. 22-10348 (9th Cir. 2024), the Court affirmed Ahmad Abouammo’s convictions for acting as an unregistered agent of a foreign government or official, 18 U.S.C. § 951; conspiracy to commit wire and honest services fraud, 18 U.S.C. § 1349; wire and honest services fraud, 18 U.S.C. §§ 1343, 1346; international money laundering, 18 U.S.C. § 1956(a)(2)(B)(i); and falsification of records to obstruct a federal investigation, 18 U.S.C. § 1519.

Abouammo, an employee at the company then known as Twitter, allegedly provided confidential information about dissident Saudi Twitter users to Bader Binasaker, a close associate of Saudi Crown Prince Mohammed bin Salman. In return, Abouammo received a watch and hundreds of thousands of dollars in payments from Binasaker.

Abouammo first argues that the evidence was insufficient to support his conviction for acting as an agent of a foreign government without prior notification to the Attorney General, in violation of 18 U.S.C. § 951.

We hold that sufficient evidence supports Abouammo’s § 951 conviction.

Although we do not exhaustively address all of its particulars, § 951 has three essential elements: “(1) a person must act; (2) the action must be taken at the direction of or under the control of a foreign government [or official]; and (3) the person must fail to notify the Attorney General before taking such action.”

In this case, there is no dispute over the first and third elements. The issue instead concerns the second: whether Abouammo acted “subject to the direction or control of a foreign government or official.” Abouammo’s sole argument on appeal is that the evidence was insufficient to convict him under § 951 because Binasaker was not a foreign “official.” In Abouammo’s view, a foreign official must “hold[] public office or otherwise serve[] in an official position in the foreign government,” and Binasaker does not meet this test because he “lacked any official role or position in the Saudi government during the relevant period.”

We conclude that it is unnecessary to resolve this issue because an alternative theory—that Abouammo acted at the behest of a foreign government—sufficiently supports the jury’s verdict. Regardless, a rational jury could conclude that Binasaker was a foreign “official” even under Abouammo’s narrow construction of that term.

We have no occasion to conduct a full examination of the term “official” in 18 U.S.C. § 951(d) or to endorse Abouammo’s narrower definition. We hold simply that even under that narrower definition, a reasonable juror could find that Binasaker was a foreign “official.”

Abouammo next challenges his convictions for money laundering and wire fraud as barred by the statute of limitations. [W]e hold that these charges were timely. 

We [] hold that when the government secured a superseding indictment within six months of the dismissal of the April 7, 2020 information, which was filed within the limitations period, the government complied with 18 U.S.C. § 3288, so that the superseding indictment was timely [despite the fact that Abouammo never waived indictment].  

Abouammo next argues that his conviction for falsification of records with intent to obstruct a federal investigation, 18 U.S.C. § 1519, should be dismissed due to improper venue.  [W]e hold that venue on Abouammo’s § 1519 charge was proper in the Northern District of California, where the allegedly obstructed federal investigation was taking place.

The question before us is whether venue for a charge under 18 U.S.C. § 1519 is limited to the district in which the false document was prepared, or whether venue can also lie in the district in which the obstructed federal investigation was taking place. It appears that no circuit has yet to address this question in the context of § 1519.

We hold that a prosecution under § 1519 may take place in the venue where documents were wrongfully falsified or in the venue in which the obstructed federal investigation was taking place. Abouammo’s misconduct properly subjected him to prosecution in either venue. We affirm Abouammo’s conviction under § 1519.

In United States v. Dorsey, --- F.4th ---, No. 19-50182 (9th Cir. 2024), the Court affirmed Dominic Dorsey’s conviction for multiple federal crimes arising from a spree of robberies committed by two disguised men.

Under Federal Rule of Evidence 701, a lay witness may offer testimony in the form of an opinion only if it is “helpful . . . to determining a fact in issue.” Fed. R. Evid. 701(b). But when a witness identifies an unknown person in an image, that opinion is not “helpful” under Rule 701 unless the witness has some personal knowledge or experience that supports a more informed identification than the jury can make on its own. The detective opined that the disguised robbers were Dorsey and Bailey without having that personal knowledge or experience. Thus, his identification opinions were not helpful and should not have been admitted. But the district court’s error in allowing the testimony was harmless, and Dorsey’s additional bases for appeal lack merit.

Although much of Detective Marsden’s lay opinion testimony was properly admitted, the district court erred by allowing the detective to opine that Dorsey and Bailey were the disguised robbers. These identification opinions were based on his assessment of still images from the robberies and pictures of Dorsey and Bailey that were in evidence before the jury. They did not meet “Rule 701’s requirement of helpfulness,” because the detective was not “more likely to identify correctly the [robbers] than [was] the jury.” United States v. LaPierre, 998 F.2d 1460, 1465 (9th Cir. 1993). Instead, the detective merely “spoon-fed his interpretations” of the evidence to the jury. Gadson, 763 F.3d at 1208 (quoting United States v. Freeman, 730 F.3d 590, 597 (6th Cir. 2013)). Thus, the identification opinions should have been excluded. 

A witness may, with sufficient background knowledge of a person, offer a lay opinion identifying that person in an image subject to the limits of Rule 701. Such an identification may be admissible opinion testimony when it evaluates evidence before the jury by contributing to that evidence the witness’s personal knowledge that the jury lacks.  Such testimony is “helpful . . . to determining a fact in issue,” Fed. R. Evid. 701(b), when the witness’s personal knowledge means that “the witness is more likely to identify correctly the person than is the jury.”

Whether a lay witness’s identification opinion is “helpful” to the jury under Rule 701 depends on the totality of the circumstances. United States v. Beck, 418 F.3d 1008, 1015 (9th Cir. 2005). We have previously recognized two situations in which an identification opinion has met “Rule 701’s requirement of helpfulness.” LaPierre, 998 F.2d at 1465. An identification opinion may be helpful, and therefore admissible, where “the witness has had substantial and sustained contact” with the defendant; or where “the defendant’s appearance in the photograph is different from his appearance before the jury and the witness is familiar with the defendant as he appears in the photograph.” Id. (collecting cases); see also Beck, 418 F.3d at 1015. Even so, we have explained that this kind of identification testimony is of “dubious value,” especially when provided by a law enforcement officer, because it can create unfair prejudice and discourage jurors from drawing their own conclusions. LaPierre, 998 F.2d at 1465; see also United States v. Butcher, 557 F.2d 666, 670 (9th Cir. 1977) (cautioning that “lay opinion identification by [law enforcement] is not to be encouraged”).

Detective Marsden’s lay opinions identifying Dorsey and Bailey as the disguised robbers were “unhelpful” and therefore inadmissible under Rule 701 because that testimony did not provide reason to believe that Detective Marsden was more likely to identify correctly the robbers than was the jury. See LaPierre, 998 F.2d at 1465. The detective did not identify the disguised robbers based on his “sustained contact” with Dorsey and Bailey, LaPierre, 998 F.2d at 1465, nor any other personal knowledge about their appearance that the jury lacked, Henderson, 68 F.3d at 326– 27. Detective Marsden served as the “lead investigator” of the crimes, and in that capacity testified to tracking down Dorsey through phone and vehicle records as well as unsuccessful attempts to follow his car. But these investigative steps focused on Dorsey’s identity on paper. They did not provide the detective with personal knowledge of Dorsey’s appearance, the basis of the detective’s identification opinion.

Given this overwhelming evidence, and the precautions the district court took to limit the effect of the improper identification opinions, we conclude that the Government met its burden to prove that “the error was more probably harmless than not.”

We affirm Dorsey’s conviction. The district court abused its discretion by allowing the prosecution to introduce lay identification opinions inadmissible under Rule 701. Lay identification opinions are “helpful” to the jury in “determining a fact in issue” only in limited circumstances. Fed. R. Evid. 701; see, e.g., LaPierre, 998 F.2d at 1465 (explaining the contexts in which such testimony has been held admissible). And we have explained that Rule 701 does not permit witnesses to spoon-feed their interpretations of the evidence to the jury. See Gadson, 763 F.3d at 1208. But here, that is exactly what the detective accomplished through his improper identification opinions. His opinion testimony identifying Dorsey and Bailey was not “helpful” within the meaning of Rule 701 and should have been excluded. We affirm only because the admissible evidence at trial and the district court’s instructions rendered the inadmissible testimony harmless.