Post-Kousisis Wire Fraud: Misrepresentations to Obtain Discounted “Export-Only” Pricing Constitute a Scheme to Obtain Property Without an Economic-Loss Requirement

Introduction

United States v. Byramji Moneck Javat (11th Cir. May 5, 2026) arises from a “fraudulent discount scheme” in which Byramji Moneck Javat, a wholesaler, induced manufacturers to sell medical supplies, pharmaceuticals, and food products at steep “export-only” discounts by falsely claiming the goods would be supplied overseas—often to the U.S. military in Afghanistan. Instead, the goods were sold domestically at a profit. Luis Alberto Soto, a Miami customs broker, served as Javat’s “logistics partner,” arranging export to Dubai and reimport into Miami, allegedly falsifying documents and concealing the true destination from manufacturers and U.S. Customs.

The appeals presented a wide range of issues: whether the indictment alleged a cognizable “scheme to defraud,” admissibility of Rule 404(b) evidence, exclusion of defense expert testimony, sufficiency of evidence of Soto’s knowledge/intent, multiple Guidelines enhancements (loss amount, number of victims, pre-retail medical product enhancement, government-agency misrepresentation, special skill, minor-role), restitution procedure and calculation, criminal forfeiture notice and mechanics (including money judgments), and third-party standing in ancillary forfeiture proceedings (Calh Holding Corp. and Pennco, LLC).

Summary of the Opinion

The Eleventh Circuit affirmed Javat’s and Soto’s convictions and sentences, and affirmed restitution and forfeiture orders. It remanded only for the limited purpose of correcting clerical errors in Javat’s criminal judgment to incorporate the forfeiture order and money judgment (via Rule 36/Rule 32.2 mechanics).

A central doctrinal move is the court’s express reliance on Kousisis v. United States, 605 U.S. 114 (2025), which it held “rejected” the Eleventh Circuit’s earlier United States v. Takhalov, 827 F.3d 1307 (11th Cir. 2016), abrogated by Kousisis v. United States, 605 U.S. 114 (2025) distinction between “schemes to deceive” (lawful) and “schemes to defraud” (unlawful) based on economic injury. Under Kousisis, the wire fraud statute requires a scheme to obtain “money or property” by false pretenses—not proof that the victim was left economically worse off.

Analysis

Precedents Cited

1) Charging, jurisdiction, and guilty-plea waiver

  • United States v. Webster, 127 F.4th 318 (11th Cir. 2025) and United States v. Lopez-Vanegas, 493 F.3d 1305 (11th Cir. 2007) (citing United States v. Calhoon, 97 F.3d 518 (11th Cir. 1996)): used to frame standards of review (abuse of discretion for denial of dismissal; de novo for statutory reach).
  • United States v. Tomeny, 144 F.3d 749 (11th Cir. 1998): establishes that an unconditional guilty plea waives non-jurisdictional defects, foreclosing Javat’s post-plea attack on the indictment.
  • United States v. Leonard, 4 F.4th 1134 (11th Cir. 2021): distinguishes jurisdictional defects (which survive a guilty plea) from other indictment errors.
  • United States v. Brown, 752 F.3d 1344 (11th Cir. 2014): supplies the Eleventh Circuit’s framework for when an indictment fails to charge a federal offense (and thus implicates subject matter jurisdiction).
  • United States v. Peter, 310 F.3d 709 (11th Cir. 2002), discussing Cleveland v. United States, 531 U.S. 12 (2000): provides the counterexample of a guilty plea to conduct later held categorically outside the fraud statute; the panel distinguishes Javat’s case because the indictment alleged classic “obtain property by false representations” conduct.
  • Ciminelli v. United States, 598 U.S. 306 (2023): invoked by Javat to argue a “right-to-control” theory; the panel rejects the analogy because the indictment did not affirmatively plead a “right to control” deprivation, and the case instead involved obtaining property (goods) by false pretenses.

2) The meaning of “scheme to defraud” after Kousisis

  • United States v. Takhalov, 827 F.3d 1307 (11th Cir. 2016), abrogated by Kousisis v. United States, 605 U.S. 114 (2025): formerly drew a sharp line requiring deception plus intended harm; here the panel treats that approach as rejected.
  • Kousisis v. United States, 605 U.S. 114 (2025): the controlling authority. The panel adopts its statement that wire fraud does not include an “economic-loss requirement,” and that the statute’s elements are: (1) a scheme, (2) to obtain money or property, (3) by means of false pretenses. This precedent is dispositive both for the motion-to-dismiss issue and Soto’s sufficiency challenge to the illegality of the scheme.
  • United States v. Bruchhausen, 977 F.2d 464 (9th Cir. 1992): cited by Soto as a “right to control”/destination-control theory case; the panel responds that Kousisis abrogated it (as it did Takhalov), and distinguishes it factually because Javat did not pay “full price” but used lies to obtain discounted goods.

3) Rule 404(b) and evidentiary limitations

  • United States v. Brown, 587 F.3d 1082 (11th Cir. 2009): provides the abuse-of-discretion standard for Rule 404(b) rulings.
  • United States v. Ellisor, 522 F.3d 1255 (11th Cir. 2008) and United States v. Stephens, 365 F.3d 967 (11th Cir. 2004): characterize Rule 404(b) as a “rule of inclusion,” supporting admission of prior acts to prove intent/knowledge rather than propensity.
  • United States v. Edouard, 485 F.3d 1324 (11th Cir. 2007): supplies the three-part 404(b) test (relevance to non-character issue; proof by preponderance; Rule 403 balance). The panel uses this framework to uphold admission of Soto’s prior diversion-related emails as intent/knowledge evidence.
  • United States v. Ramirez, 426 F.3d 1344 (11th Cir. 2005): supports the principle that similarity increases probative value on intent.
  • United States v. Perry, 14 F.4th 1253 (11th Cir. 2021): relied upon both for limiting-instruction effectiveness (reducing unfair prejudice) and hearsay treatment of embedded statements offered for effect on listener.
  • United States v. McNair, 605 F.3d 1152 (11th Cir. 2010): supports the proposition that a not-guilty plea places intent at issue in conspiracy cases.

4) Expert testimony, relevance, and “complete defense” doctrine

  • United States v. Barton, 909 F.3d 1323 (11th Cir. 2018): standard of review for exclusion of expert testimony (abuse of discretion).
  • United States v. Svete, 556 F.3d 1157 (11th Cir. 2009), citing Durland v. United States, 161 U.S. 306 (1896), and quoting United States v. Coyle, 63 F.3d 1239 (3d Cir. 1995): anchors the panel’s view that victim negligence is not a defense; fraud focuses on the defendant’s intent. This undercuts Soto’s attempt to argue manufacturers could have protected themselves.
  • Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579 (1993): invoked for the proposition that expert testimony irrelevant to an issue is “non-helpful” and inadmissible.
  • United States v. Hurn, 368 F.3d 1359 (11th Cir. 2004) and Chapman v. California, 386 U.S. 18 (1967): provide the two-step framework for constitutional “complete defense” claims (violation + harmless beyond reasonable doubt).
  • United States v. Mitrovic, 890 F.3d 1217 (11th Cir. 2018), United States v. Scheffer, 523 U.S. 303 (1998), and United States v. Frazier, 387 F.3d 1244 (11th Cir. 2004) (en banc): emphasize that the right to present a defense is subject to reasonable evidentiary rules, and that proper application of Federal Rules of Evidence typically defeats a constitutional claim.
  • United States v. Pon, 963 F.3d 1207 (11th Cir. 2020): illustrates that even assumed constitutional error may be harmless.

5) Sufficiency of evidence

  • United States v. Azmat, 805 F.3d 1018 (11th Cir. 2015), quoting United States v. Monroe, 866 F.2d 1357 (11th Cir. 1989): supplies the sufficiency-of-evidence standard.

6) Sentencing: loss, victims, enhancements, role adjustments

  • United States v. Stein, 846 F.3d 1135 (11th Cir. 2017): cited by defendants to argue discount-based “loss” was not fraud-caused; the panel distinguishes Stein because manufacturers here relied on the lies and no intervening causes were shown.
  • United States v. Annamalai, 939 F.3d 1216 (11th Cir. 2019) and United States v. Medina, 485 F.3d 1291 (11th Cir. 2007): used to justify “reasonable estimate” loss calculation in fraud cases.
  • United States v. Marti-Lon, 524 F.3d 295 (1st Cir. 2008), United States v. White, 846 F.3d 170 (6th Cir. 2017), United States v. Farano, 749 F.3d 658 (7th Cir. 2014), and United States v. Ali, 620 F.3d 1062 (9th Cir. 2010): persuasive authorities supporting “lost profits”/discount-differential as a permissible loss proxy.
  • United States v. Rodriguez, 732 F.3d 1299 (11th Cir. 2013), United States v. Lawrence, 47 F.3d 1559 (11th Cir. 1995), and United States v. Matthews, 3 F.4th 1286 (11th Cir. 2021): govern the “ten or more victims” finding (preponderance; reliable and specific evidence; reasonable inferences).
  • United States v. Dupree, 57 F.4th 1269 (11th Cir. 2023) (en banc): supports textual inference from the Guidelines’ differing language (“convicted of” vs “conduct described”).
  • United States v. De La Cruz Suarez, 601 F.3d 1202 (11th Cir. 2010) and United States v. Calderon, 127 F.3d 1314 (11th Cir. 1997): define “special skill” as something the average person lacks, often requiring licensing/training; used to uphold the customs-broker enhancement.
  • United States v. De Varon, 175 F.3d 930 (11th Cir. 1999) (en banc), United States v. Cabezas-Montano, 949 F.3d 567 (11th Cir. 2020), and United States v. Martin, 803 F.3d 581 (11th Cir. 2015): govern the minor-role analysis and burden; applied to deny Soto’s request given his essential operational role.
  • United States v. Perez-Tosta, 36 F.3d 1552 (11th Cir. 1994) and United States v. Muho, 978 F.3d 1212 (11th Cir. 2020): support trial-court discretion to deny/quash untimely Rule 17 subpoenas (sentencing/restitution contexts).

7) Restitution: procedure, proof, approximation

  • United States v. Edwards, 728 F.3d 1286 (11th Cir. 2013): provides standards for reviewing restitution legality and factual findings.
  • United States v. Valladares, 544 F.3d 1257 (11th Cir. 2008), United States v. Jeri, 869 F.3d 1247 (11th Cir. 2017), United States v. Verderame, 51 F.3d 249 (11th Cir. 1995), and United States v. Saget, 991 F.2d 702 (11th Cir. 1993): frame denial-of-continuance review and “specific substantial prejudice” requirement.
  • United States v. Williams, 612 F.3d 500 (6th Cir. 2010): cited for the MVRA proposition that government has an obligation to seek full restitution.
  • United States v. Goldman, 953 F.3d 1213 (11th Cir. 2020) and United States v. Robertson, 493 F.3d 1322 (11th Cir. 2007): define restitution entitlement and “victim” causation (direct and proximate harm).
  • United States v. Cavallo, 790 F.3d 1202 (11th Cir. 2015) and United States v. Futrell, 209 F.3d 1286 (11th Cir. 2000): support that restitution calculation parallels loss and may be approximated.
  • United States v. Gatlin, 90 F.4th 1050 (11th Cir. 2024): supports reliance on unsworn business records/spreadsheets if indicia of reliability exist.
  • United States v. Huff, 609 F.3d 1240 (11th Cir. 2010) and United States v. Foley, 508 F.3d 627 (11th Cir. 2007): govern appellate review of the specific restitution amount (clear error).

8) Forfeiture: notice, incorporation, money judgments, joint acquisition

  • United States v. Waked Hatum, 969 F.3d 1156 (11th Cir. 2020) and United States v. Farias, 836 F.3d 1315 (11th Cir. 2016): support (i) de novo review of forfeiture legal issues and (ii) harmlessness of Rule 32.2 irregularities where notice/opportunity to contest existed; also cited for permissibility of forfeiture money judgments under § 981(a)(1)(C).
  • United States v. Annabi, 746 F.3d 83 (2d Cir. 2014): contrasted—there the government never corrected the wrong forfeiture statute before final judgment; here the government did, making any error harmless.
  • United States v. Pease, 331 F.3d 809 (11th Cir. 2003): invoked by Javat to resist post-judgment correction; the panel explains Pease relied on predecessor rules and that modern Rule 32.2 expressly allows Rule 36 correction.
  • United States v. Dahda, 852 F.3d 1282 (10th Cir. 2017): used to justify remand for clerical correction without vacating forfeiture.
  • Honeycutt, v. United States, 581 U.S. 443 (2017) and United States v. Goldstein, 989 F.3d 1178 (11th Cir. 2021): address limits of joint-and-several forfeiture; the panel assumes arguendo Honeycutt might apply, but deems proceeds “jointly acquired” (thus forfeitable) under Goldstein’s reading.
  • United States v. Evans, 473 F.3d 1115 (11th Cir. 2006): supports the rule that arguments raised for the first time in a reply brief are not properly before the court.
  • United States v. Lo, 839 F.3d 777 (9th Cir. 2016): cited for the proposition that indictment notice need not specify a money judgment.

9) Third-party standing in ancillary proceedings and “straw owner” doctrine

  • United States v. Cone, 627 F.3d 1356 (11th Cir. 2010): standard of review for standing questions.
  • Christian Coal. of Fla., Inc. v. United States, 662 F.3d 1182 (11th Cir. 2011), Via Mat Int'l S. Am. Ltd. v. United States, 446 F.3d 1258 (11th Cir. 2006), Warth v. Seldin, 422 U.S. 490 (1975), In re Breland, 989 F.3d 919 (11th Cir. 2021), and Friends of the Earth, Inc. v. Laidlaw Envtl. Servs., Inc., 528 U.S. 167 (2000): provide the Article III standing framework and the focus on “injury,” not merely title.
  • United States v. 900 Rio Vista Blvd., 803 F.2d 625 (11th Cir. 1986): key forfeiture standing precedent—bare legal title without dominion/control is insufficient; courts may look behind formal title to identify “strawman” ownership.
  • United States v. Cambio Exacto, 166 F.3d 522 (2d Cir. 1999): cited via Via Mat for the idea that “straw owners” may lack sufficient injury for standing.
  • United States v. Gilbert, 244 F.3d 888 (11th Cir. 2001): distinguished—there were conflicting factual findings; here preliminary forfeiture did not decide the third parties’ ownership.
  • Hollingsworth v. Perry, 570 U.S. 693 (2013): invoked to emphasize standing is a question of federal law, not state law (rejecting veil-piercing/state-law framing).
  • United States v. Bailey, 419 F.3d 1208 (11th Cir. 2005) and United States v. Carrell, 252 F.3d 1193 (11th Cir. 2001): clarify “relation back” and permissibility of considering pre-seizure facts; used to reject Calh/Pennco’s temporal-evidence argument.
  • United States v. Davenport, 668 F.3d 1316 (11th Cir. 2012): supports limiting third-party challenges to ancillary proceedings and restricts third parties from challenging forfeitability determinations directly.
  • Maldonado v. U.S. Att'y. Gen., 664 F.3d 1369 (11th Cir. 2011), quoting Ragsdale v. Rubbermaid, Inc., 193 F.3d 1235 (11th Cir. 1999), and Sapuppo v. Allstate Floridian Ins. Co., 739 F.3d 678 (11th Cir. 2014): invoked to dispose of underdeveloped or previously available substitute-asset forfeiture arguments (res judicata / abandonment).

Legal Reasoning

1) Wire fraud after Kousisis: the “economic harm” debate ends

The opinion’s most consequential reasoning is its application of Kousisis v. United States to an “export-only pricing” fraud. The defendants argued (echoing the earlier Eleventh Circuit logic of United States v. Takhalov) that manufacturers got what they bargained for—money in exchange for goods—and thus suffered no cognizable harm. The panel rejects this: under Kousisis, the wire fraud statute turns on whether defendants sought to obtain money or property by false pretenses. Here, the “property” was the manufacturers’ goods obtained at a price induced by lies about export destination; the bargain itself was procured “by means of” false representations.

The court’s approach is notably charge- and elements-focused: once the indictment and proof show a scheme “to obtain money or property” “by means of” false representations, the illegality inquiry is satisfied—even if a defendant characterizes the transaction as a “discount” the victim agreed to provide.

2) Knowledge and intent: operational concealment as proof of culpable state of mind

For Soto, the central factual dispute was knowledge/intent. The panel emphasizes: (i) prior similar diversion emails admitted under Rule 404(b), (ii) the lack of legitimate commercial reason to export and immediately reimport (incurring costs), (iii) Soto’s communications acknowledging that Dubai was “where the supplier believes cargo is going,” and (iv) falsified customs statements and document manipulation aimed at preventing manufacturer discovery. In the court’s view, concealment steps are not merely “regulatory” but probative of knowing participation in deception.

3) Sentencing and restitution: “lost profits” as pecuniary harm in discount fraud

The court validates a lost-profits/discount-differential methodology for both Guidelines loss and MVRA restitution, reasoning that victims were deprived of the opportunity to sell at higher domestic prices absent the lie. The panel treats the 50% “export-only” discount as a concrete, foreseeable pecuniary harm proximately caused by the misrepresentation, and permits approximation based on reliable business records and testimony.

4) Forfeiture: technical defects cured by notice, and clerical omissions corrected

The panel treats the indictment’s incorrect statutory forfeiture citation as harmless because Javat had notice of forfeiture and the government corrected the statute before sentencing. It further holds that any deficiency in the judgment’s incorporation of forfeiture orders can be corrected under Rule 36—explicitly limiting reliance on United States v. Pease in light of modern Rule 32.2(b)(4)(B). The court also reaffirms that forfeiture money judgments are authorized under § 981(a)(1)(C) (consistent with its circuit precedent).

5) Third-party petitions: “bare legal title” does not create standing

For Calh and Pennco, the court’s reasoning is dominion-and-control oriented: the corporate/trust structure and “ultimate beneficial owner” documents supported the finding that these entities were straw owners holding title for Javat. Under United States v. 900 Rio Vista Blvd., that means no Article III injury and thus no standing to contest forfeiture in ancillary proceedings.

Impact

  • Fraud prosecutions post-Kousisis: The opinion exemplifies how the Eleventh Circuit will operationalize Kousisis v. United States to defeat defenses premised on “no economic loss” or “victim got the benefit of the bargain,” particularly in pricing/discount procurement schemes. Even though the decision is “NOT FOR PUBLICATION,” it signals that United States v. Takhalov arguments are unlikely to succeed where defendants obtained property by lies.
  • Discount diversion as quantifiable harm: The court’s acceptance of lost profits as loss and restitution reinforces the prosecutorial and sentencing viability of cases where the injury is an induced pricing concession rather than an outright nonpayment.
  • Operational evidence of concealment: Customs paperwork manipulation, port routing decisions, and efforts to avoid alerting suppliers are treated as probative of fraudulent intent, strengthening evidentiary narratives in diversion/parallel import cases.
  • Forfeiture procedure stability: The harmless-error approach to mis-cited forfeiture statutes (when cured by notice) and the willingness to correct judgments under Rule 36 reduce the likelihood that forfeiture will be undone on purely clerical grounds.
  • Ancillary standing barriers for nominee entities: The reaffirmed “straw owner” doctrine places a heavy premium on proving genuine dominion/control, not just record title, for third-party challengers to substitute-asset forfeitures.

Complex Concepts Simplified

  • “Scheme to defraud” vs. “scheme to deceive”: After Kousisis v. United States, the focus is whether the defendant used lies to obtain money or property—without needing to prove the victim ended up economically worse off.
  • Rule 404(b) evidence: Prior acts can be admitted not to show “bad character,” but to show intent, knowledge, or absence of mistake—especially where the defendant’s state of mind is the core trial issue.
  • Loss vs. restitution: Guidelines “loss” informs sentencing severity; MVRA “restitution” compensates victims. Both can be reasonably estimated and often rely on similar calculations (here, discount-induced lost profits).
  • Forfeiture money judgment: A monetary forfeiture order allowing the government to collect the value of criminal proceeds even if the specific dollars are gone; substitute assets may be forfeited to satisfy it.
  • Ancillary proceeding and straw owners: Third parties challenge forfeiture through ancillary proceedings, but an entity holding only “bare legal title” for the defendant (a nominee/straw owner) lacks the “injury” needed for constitutional standing.

Conclusion

The Eleventh Circuit’s opinion consolidates a post-Kousisis v. United States understanding of wire fraud: when defendants obtain property (here, discounted goods) by lies, the fraud statutes apply even if defendants argue the victim “agreed” to the deal and received payment. The decision also endorses lost-profits calculations for sentencing and restitution in discount-procurement fraud, maintains broad discretion in evidentiary and subpoena-timing rulings, and reinforces modern forfeiture practice—treating notice-based defects as harmless and clerical omissions as correctable. Finally, it underscores that nominee title holders cannot defeat forfeiture absent proof of real dominion and control.