United States v. Reagan

• Citation: 725 F.3d 471
• Decision Date: 02 August 2013
• Docket Number: No. 10–10211.,10–10211.
• Parties: UNITED STATES of America, Plaintiff–Appellee v. Darren L. REAGAN, also known as Dr. Darren L. Reagan; D'Angelo Lee; Donald W. Hill, also known as Don Hill; Sheila D. Farrington, also known as Sheila Hill, Defendants–Appellants.
• Court: United States Courts of Appeals. United States Court of Appeals (5th Circuit)

725 F.3d 471

UNITED STATES of America, Plaintiff–Appellee

v.Darren L. REAGAN, also known as Dr. Darren L. Reagan; D'Angelo Lee; Donald W. Hill, also known as Don Hill; Sheila D. Farrington, also known as Sheila Hill, Defendants–Appellants.

No. 10–10211.

United States Court of Appeals,Fifth Circuit.

Aug. 2, 2013.

James Wesley Hendrix, Leigha Amy Simonton, Susan Cowger, Assistant U.S. Attorneys U.S. Attorney's Office, Northern District of Texas, Dallas, TX, for Plaintiff–Appellee.

Darren L. Reagan, Oakdale, LA, pro se.

Douglas C. Greene, Sr., Esq., Greene Law Finn, Arlington, TX, Seth Kretzer, Law Offices of Seth Kretzer, Houston, TX, Kevin Blake Ross, Sorrels, Udashen & Anton, Dallas, TX, for Defendants–Appellants.

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

Before JONES and CLEMENT, Circuit Judges, and KAZEN ^*, District Judge.

EDITH BROWN CLEMENT, Circuit Judge:

Donald Hill, D'Angelo Lee, Sheila Farrington, and Darren Reagan (the “appellants”) appeal on numerous grounds their convictions and sentences in this case involving substantial and wide-ranging public corruption charges related to government-subsidized development projects in Dallas, Texas. We AFFIRM the judgment of the district court.

FACTS AND PROCEEDINGS

A. Procedural background

The appellants were four of fourteen defendants indicted by a federal grand jury on September 27, 2007. During the time period covered by the indictment, roughly 2003 through 2005, Donald Hill was an elected member of the Dallas City Council, representing a South Dallas district. City Council members had the power to nominate members of a number of city commissions, including the City Plan and Zoning Commission (“CPC”). On Hill's nomination, the City Council appointed D'Angelo Lee to the CPC in October 2003. Sheila Farrington, Hill's mistress and later his wife, purported to work as a consultant using the business name Farrington & Associates. Darren Reagan was the chairman and chief executive of the Black State Employees Association of Texas (“BSEAT”) and the BSEAT Community Development Corporation (“BSEAT CDC”).

The indictment alleged that the appellants had been involved in various capacities in illegal schemes related to attempts by two housing developers, Brian Potashnik and James “Bill” Fisher, to obtain public financing, zoning clearance, and political support for their rival housing development plans in Dallas. Specifically, Count 10 of the indictment charged Hill, Lee, and Farrington with having conspired to solicit bribes from Potashnik, in violation of 18 U.S.C. §§ 371 and 666. Counts 11 and 12 charged Hill and Lee with having solicited bribes from Potashnik, in violation of § 666, and Farrington with having aided and abetted the bribery. Count 15 charged Hill, Lee, Farrington, and Reagan with having conspired to extort Fisher, in violation of 18 U.S.C. § 1951. Count 16 charged Hill and Lee with extorting Fisher, in violation of § 1951, and Farrington and Reagan with aiding and abetting that extortion. Count 17 charged Hill and Reagan with a separate instance of extorting Fisher, in violation of § 1951. Count 18 charged Hill, Lee, and Farrington with honest services fraud, in violation of 18 U.S.C. § 1346. Count 19 charged Hill, Lee, and Farrington with having conspired to commit money laundering, in violation of 18 U.S.C. § 1956(h), with respect to the funds obtained from bribery. Count 20 charged Hill and Reagan with the same with respect to the funds obtained from extortion.

The appellants proceeded to trial, which commenced on June 22, 2009, and stretched over the course of 47 days, concluding on September 23.¹

B. Summary of the evidence

Among many other witnesses, both Fisher and Potashnik testified for the Government at trial. Fisher had cooperated extensively with the FBI during the investigation, while Potashnik had been charged in the same indictment as the appellants and pled guilty to a single count of conspiracy to commit bribery.

The Government's evidence showed that, in order to obtain Hill's political support for his housing developments, Potashnik agreed to hire Farrington as a community consultant. Potashnik regularly paid Farrington, through a bank account set up in the name of Farrington & Associates, despite Farrington never having done any work for him. Hill and Lee also demanded that Potashnik involve various non-profit organizations in his developments, and these organizations then remitted part of their fees to Farrington through her Farrington & Associates account. Farrington used money from this account to buy cars for Hill and Lee and made cash withdrawals from the account for Lee. In return for Potashnik's cooperation, Hill, among other acts, pushed the City Council to approve a financing deal for one of Potashnik's housing developments.

Lee also demanded that Potashnik agree to use a certain percentage of minority labor in the construction of one of his developments. To that end, Lee instructed Potashnik to hire a woman named Andrea Spencer as a minority contractor. Spencer herself did no contracting work, but instead partnered with a contractor named Ron Slovacek, a white male, to do the work she obtained as a result of her minority contractor certification. Potashnik gave Spencer and Slovacek an $800,000 concrete contract. Shortly thereafter, Hill pushed the City Council for tax credit funding for two of Potashnik's developments, and Lee helped Potashnik obtain a permit to build a community center and swimming pool at one of his developments. Slovacek eventually admitted to Spencer that he was remitting 10% of every check he received through this scheme to Lee, much of it through checks made out to Farrington.

Potashnik had further dealings with Lee and Hill with respect to a proposal before the City Council that would have reduced the number of rent-restricted apartments required in three of his developments.²Potashnik told Lee that he would work out a deal with Spencer and Slovacek on a new concrete contract, despite their bid being $250,000 higher than competitors' bids. In return, Lee told Potashnik that he and Hill would ensure that the City Council proposal passed and had a conversation with Hill in which he confirmed this arrangement. When the measure failed to pass the City Council, Potashnik refused to give the concrete contract to Spencer and Slovacek, and his relationship with Lee and Hill irreparably broke down.

While these machinations with respect to Potashnik were ongoing, the appellants were also involved in illegal schemes related to Potashnik's rival, Fisher. Beginning in August 2004, Reagan began asking Fisher for lump sums of money and percentages of the general partner developer's fee that Fisher received on each of his developments. Reagan frequently referenced Hill in his conversations with Fisher. Reagan indicated that, if Fisher involved Reagan in his development plans, Reagan would ensure that Fisher would not have problems with Hill and the City Council. Hill, on one occasion, also told Fisher that he needed to work out his problems with Reagan in order to resolve issues related to one of his developments.

On October 27, 2004, Fisher suffered a number of adverse zoning rulings. A few days later, Lee asked Fisher to contribute money to fund Hill's birthday party. Fisher refused, and shortly thereafter a CPC vote affecting Fisher was postponed. Reagan continued to make demands of Fisher, requesting that his wife and parents be given community outreach jobs by Fisher. On November 10, Fisher signed a contract for $100,000 with Reagan, and Hill then shepherded through the City Council a motion to approve financing for one of Fisher's developments, Pecan Grove.

Then Fisher was called by two men, Rickey Robertson and Jibreel Rashad, who had recently formed an entity called RA–MILL, LLC. Neither Robertson nor Rashad had substantial prior experience as contractors. Robertson told Fisher that Lee had referred him to Fisher and that RA–MILL was interested in serving as a subcontractor on Fisher's Pecan Grove project. Robertson later told Fisher that Lee was a silent partner in RA–MILL and that, if Fisher hired RA–MILL, Lee would speed approval for another one of Fisher's projects, Dallas West Village, through the CPC, after which Hill would support the project before the City Council. Lee later helped bring Dallas West Village through the CPC process.

On December 29, Fisher met with Lee and Hill to discuss ongoing zoning issues. At that meeting, Lee and Hill encouraged him to sign contracts with RA–MILL. The next day, Robertson and Rashad sent Fisher one-page contracts obligating him to pay RA–MILL a fee of 10% of the total value of the projects they had proposed they be cut in on. This 10% fee would have amounted to between $600,000 and $800,000. Fisher rejected the contracts, and Robertson told him that Lee wanted the contracts signed before an upcoming CPC zoning vote. A week later, on discovering that Robertson and Rashad were planning to subcontract out all of the work that Fisher would give them, Fisher refused to deal with them further. He then received two proposals from RA–MILL: either he could give RA–MILL contracts for concrete and drywall work and pay an initial contractor fee of $180,000, or he could pay RA–MILL 3% of the total construction cost of his projects in return for RA–MILL not pursuing any further work on them. Robertson told Fisher that Lee was in support of these proposals, although Lee, fearing that he was being recorded, later denied that he had been involved in their formulation.

Around this time, as the Pecan Grove project began to progress, Reagan began invoicing Fisher for additional sums of money. Reagan told Fisher that Lee and Hill had told him to coordinate his activities with respect to Pecan Grove with RA–MILL's. To this end, Fisher received invoices from Reagan demanding $180,000 for RA–MILL for construction consulting...