United States v. Morales

• Decision Date: 30 November 2015
• Docket Number: 14–51323.,Nos. 14–51314,s. 14–51314
• Citation: 807 F.3d 717
• Parties: UNITED STATES of America, Plaintiff–Appellee Private Counsel, Appellee v. Daniel C. MORALES, Defendant–Appellant. United States of America, Plaintiff–Appellee v. Daniel C. Morales, Defendant–Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

807 F.3d 717

UNITED STATES of America, Plaintiff–Appellee

Private Counsel, Appellee

v.Daniel C. MORALES, Defendant–Appellant.

United States of America, Plaintiff–Appellee

v.Daniel C. Morales, Defendant–Appellant.

Nos. 14–51314

14–51323.

United States Court of Appeals, Fifth Circuit.

Nov. 30, 2015.

Joseph H. Gay, Jr., Assistant U.S. Attorney, Mark Randolph Stelmach, Esq., Assistant U.S. Attorney, San Antonio, TX, Jennifer Sheffield Freel (argued), Assistant U.S. Attorney, Sharon S. Pierce, Assistant U.S. Attorney, Austin, TX, for Plaintiff–Appellee.

Jane Webre, Samuel Johnson, Scott, Douglass & McConnico, L.L.P., Austin, TX, Malcolm Nathan Greenstein, Greenstein & Kolker, Austin, TX, Michael E. Tigar, Attorney, Tigar Law Firm, Oriental, NC, for Appellee.

Kenneth Reed Wynne, Esq. (argued), Wynne & Wyme, L.L.P., Houston, TX, for Defendant–Appellant.

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

Before STEWART, Chief Judge, and CLEMENT and ELROD, Circuit Judges.

EDITH BROWN CLEMENT, Circuit Judge.

In 2003, Daniel Morales, the former Attorney General of Texas, was convicted of mail fraud and of making and filing a false income tax return. During his criminal prosecution, the district court entered a protective order covering discovery materials produced by certain victims and third parties. More than a decade later, Morales moved to modify that protective order to permit the limited disclosure of certain documents. The district court denied that motion, and Morales now appeals.¹ Because Morales has not shown any changed circumstances justifying his requested modification, we affirm.

I.

Morales served as Attorney General of Texas from 1991 to 1999. During his tenure, he oversaw Texas's litigation against big tobacco companies. That litigation resulted in a gargantuan settlement and, indirectly, Morales's conviction and incarceration.

Morales hired a group of Texas law firms ("Private Counsel") to conduct the litigation against big tobacco. After several years of litigation, Private Counsel secured a $17.3 billion settlement and applied for the attorney's fees provided for in their agreement with Texas. On the day the case settled, Marc Murr—Morales's personal friend and campaign advisor—also applied for attorney's fees, even though he was not party to Private Counsel's agreement. In support of his application, Murr proffered retainer agreements between him and Texas that pre-dated the settlement agreement and that would entitle him to a gigantic attorney's fees award.

Murr never received that award, however, because authorities soon discovered that Morales had faked the purported agreements between Texas and Murr as part of a scheme to profit from the settlement award. In fact, Murr had provided no appreciable legal services to Texas regarding the tobacco litigation. Soon after the scheme was discovered, Morales was indicted.

During Morales's criminal proceedings, Private Counsel moved for a protective order under Federal Rule of Criminal Procedure 16(d)(1). Listed as victims of Morales's scheme in the indictment and cooperating as witnesses, Private Counsel asked the district court to prevent Morales from disclosing information they produced in the course of the prosecution. Private Counsel sought the protective order after learning that Morales intended to sue Private Counsel to recover some or all of the fee award that Private Counsel recovered as part of the settlement agreement. The government—citing the Victim and Witness Protection Act—supported Private Counsel's motion, and confirmed that Morales was soliciting plaintiffs' lawyers' assistance in suing Private Counsel. In direct response to the concerns voiced by Private Counsel, the district court granted Private Counsel's motion and entered a protective order requiring the parties to keep "all discovery" confidential and to "not disclose same except as necessary to prepare their cases for trial."

A few months later, Morales pleaded guilty to mail fraud and to making and filing a false income tax return. The district court sentenced him to 48 months of imprisonment and three years of supervised release. Shortly before Morales was sentenced, he moved to modify the protective order so that he could enter several hundred pages of evidence (including the two documents at issue in this appeal) obtained during his prosecution into the record. The district court denied the motion. Morales neither pursued a direct appeal nor appealed the district court's denial of his motion to modify.

Fast-forward eleven years to 2014. Morales, who had completed his prison term and term of supervised release, again filed a motion to modify the protective order. This time, Morales limited his motion: He asked the district court to lift the protective order only as to two specific documents, both of which Private Counsel produced to the government during his prosecution. Morales himself has had these documents since at least 2003, when he received them from the government during his criminal proceedings. The documents were never entered into evidence, however. Morales seeks to use the documents as the basis for a qui tam suit on Texas's behalf against Private Counsel because, in his view, they provide a basis for the recovery of some or all of Private Counsel's tobacco-settlement fee award.

Private Counsel and the government both opposed Morales's motion.

The district court held a hearing on the motion to modify and, on November 20, 2014, denied it. Morales filed a motion for extension of time to appeal, along with a notice of appeal, on December 9, 2014. The district court denied his motion for an extension, and Morales appealed that denial as well. We consolidated his appeals.

Private Counsel and the government contend that this is a criminal appeal governed by Federal Rule of Appellate Procedure 4(b) and, as a result, that Morales did not timely file his appeal within fourteen days. Morales counters that this is a civil appeal governed by Rule 4(a) and that, even if it is not, the district court abused its discretion in denying his motion for an extension of time to file.

Aside from his arguments about whether he timely filed his appeal, Morales argues on appeal only that the district court abused its discretion in denying his motion to modify the protective order.

II.

We review the district court's denial of a motion to modify a criminal protective order for abuse of discretion. See United States v. Gurney, 558 F.2d 1202, 1211 n. 15 (5th Cir.1977) (noting district court's discretion in deciding confidentiality of documents in criminal case); cf. United States v. Miramontez, 995 F.2d 56, 59 (5th Cir.1993) (reviewing denial of motion for disclosure of grand jury materials for abuse of discretion).

III.

Private Counsel and the government both contend that Morales did not timely file his notice of appeal. Whether Morales timely noticed his appeal depends on whether this appeal is criminal or civil in nature.

Federal Rule of Appellate Procedure 4(a)(1)(B) provides litigants sixty days to notice an appeal in a civil case involving the United States. Rule 4(b)(1)(A), on the other hand, provides defendants only fourteen days to notice an appeal in a criminal case. The district court entered the order denying Morales's motion on November 20, 2014. Morales filed his notice of appeal on December 9, 2014 (nineteen days later). If Morales's appeal is civil, rather than criminal, his notice of appeal was timely under Rule 4(a)(1)(B).²

We have never considered whether Rule 4(a) or 4(b) governs an appeal from an order denying a post-conviction motion to modify a criminal protective order. Although Morales filed his motion to modify the protective order "in the same court and under the same docket number as his earlier criminal proceeding, this does not require that his [motion] be treated as a criminal action." Miramontez, 995 F.2d at 58 ; see United States v. Roher, 706 F.2d 725, 727 (5th Cir.1983). Rule 4(a) applies to civil proceedings, even those arising from earlier criminal cases; the inquiry is whether the proceedings themselves are civil. Indeed, even some appeals arising out of motions under the Federal Rules of Criminal Procedure are civil for Rule 4 purposes. Hunt v. U.S. Dep't of Justice, 2 F.3d 96, 97 (5th Cir.1993) (per curiam) (Rule 4(a) applies to Rule 41(e) motions for return of property); Roher, 706 F.2d at 727 (Rule 4(a) applies to Rule 46(f) motions to remit or set aside forfeiture of appearance bond).

But we have never set out a clear test for determining whether proceedings other than direct appeals arising out of final judgments in criminal cases are civil or criminal in nature. Instead, we have often reasoned by analogy. See United States v. Truesdale, 211 F.3d 898, 903 (5th Cir.2000). Where motions have civil analogues, that weighs in favor of the proceedings being civil.See id. at 904 (Rule 4(a) applies to appeals from orders on Hyde Amendment motions, regarding reimbursement of attorney's fees to defendants in certain criminal cases, because those motions are analogous to motions under Equal Access to Justice Act); United States v. Cooper, 876 F.2d 1192, 1194 (5th Cir.1989) (per curiam) (Rule 4(a) applies to appeals from orders on petitions for writs of error coram nobis because those petitions are equivalent to § 2255 motions, which are governed by Rule 4(a) ), abrogated on other grounds by Smith v. Barry, 502 U.S. 244, 112 S.Ct. 678, 116 L.Ed.2d 678 (1992) ; see also Roher, 706 F.2d at 727 (Rule 4(a) applies to appeals from orders denying motions to set aside or remit forfeiture of appearance bond because those motions involve "a plainly civil subject"); Miramontez, 995 F.2d at 58 (Rule 4(a) applies to appeal from order on motion for disclosure of grand jury transcripts where district court construed petition, in part, as FOIA request, a construction that "emphasize[d] the civil aspect" of the proceedings).

A motion that "deals directly with the movant's...