(Jacob G. Hornberger) On July 29, 2025, a three-judge panel of the First Circuit federal Court of Appeals unanimously upheld the criminal convictions and incarceration of libertarian Bitcoin activist Ian Freeman, who I have steadfastly maintained is an innocent man who federal officials railroaded into an 8-year prison sentence, which he is now serving.
Here are my articles about the Freeman case, which explain in detail why this man is innocent:
The Court’s opinion
A person who is convicted of a crime in a U.S. District Court has the right to appeal his conviction to the federal Court of Appeals in the circuit in which the District Court is situated. To do that, he must file a Notice of Appeal. He must then file an appellate brief stating what exactly are the legal rulings that the District Judge made that void the conviction or that require the case to be sent back for a new trial. He must cite legal authority (i.e., legal opinions from similar federal cases) to support each of his points. There is something important to note about the defendant’s appellate brief: If he fails to challenge a particular ruling of the District Judge, he waives the point. That is, it is gone forever. He cannot later raise it during oral arguments or at a later time.
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Freeman was convicted of the following crimes, for which he received the following prison sentences:
(1) Failing to register his bitcoin business with the federal government and conspiring to fail to register his bitcoin business with the federal government. Five years.
(2) Failure to pay income tax for various years. Five years.
(3) Money laundering.
(4) Conspiracy to launder money. Eight years.
The District Judge threw out the money-laundering conviction (number 3) before sentencing. He held that there was no evidence whatsoever to support the jury’s conviction on that count. And there wasn’t. The judge acted properly in throwing out that conviction, notwithstanding the jury’s verdict of guilty.
A “no-evidence” point to challenge a conviction can also be raised on appeal. But, again, it must be raised as a specific point in the defendant’s appellate brief. If it is not raised, it is waived (unless the Court of Appeals raises the issue on its own motion as a matter of simple justice — that is, avoiding upholding a conviction of an innocent person — that is, a person whose has been convicted of a crime when there is no evidence whatsoever that the person committed the crime).
The conspiracy conviction
It is my contention that there was no evidence whatsoever in the record that Freeman entered into a conspiracy to launder money. In other words, the same no-evidence basis on which the District Court threw out the substantive charge of laundering money applied to the conspiracy-to-launder money charge as well. Thus, I contend that Freeman’s lawyer should have challenged the conspiracy count in his appellate brief with a point stating, “There is no evidence to support the jury’s verdict of conspiracy-to-launder money and, therefore, that conviction should be set aside, just as the money-laundering conviction was set aside by the District Judge.”
But Freeman’s lawyer failed to do that. He failed to challenge on appeal the conspiracy conviction based on “no evidence” to support it, notwithstanding the fact that that was the conviction on which Freeman had received the highest prison sentence — 8 years, as compared to 5 years on the failing-to-register and income-tax evasion convictions. (All the sentences ran concurrently — that is, at the same time.)
Why was the failure to challenge the conspiracy conviction so important? Because it left the conspiracy conviction intact! In other words, once Freeman waived any challenge of the 8-year conspiracy conviction, he was effectively finished. That is, even if the Court of Appeals had voided his registration convictions and his income-tax convictions, Freeman would have still been saddled with the conspiracy conviction and the 8-year prison sentence that came with it simply because his lawyer failed to challenge it on appeal.
Except for one thing: Freeman’s attorney argued that the evidence from the money-laundering conviction was so prejudicial that it “spilled over” into the conspiracy conviction and prejudicially affected the jury’s verdict on the conspiracy charge. Therefore, he argued, the case should be sent back for a new trial without the jury hearing the evidence regarding the money-laundering conviction that was thrown out. But in its opinion, the Court of Appeals rejected that spillover argument, stating that it was entirely proper for the jury to hear the money-laundering evidence in considering the conspiracy charge.
Freeman’s attorney also made his “spillover” argument with respect to the registration and tax-evasion charges. But since the Court upheld Freeman’s convictions on those charges, the spill-over argument with respect to those charges became moot. But I think that it is highly likely that even if the Court of Appeals had knocked out either the registration charge or the tax-evasion charge or both, it would have rejected the spillover argument anyway with respect to those charges.
I contend that the “no-evidence” point was much more powerful than the spillover argument, especially since there simply was no evidence whatsoever in the record that Freeman conspired with anyone to launder money. But the important point is that Freeman’s lawyer could have raised both points. He wasn’t relegated to choosing between them.
In its opinion, the Court of Appeals did allude to Freeman’s failure to challenge the conspiracy to launder money charge on appeal. In footnote #33 on page 71 of its 81-page opinion, the Court stated, “The district court did not acquit Freeman of conspiracy to commit money laundering, a decision that Freeman has not challenged.”
In its opinion, the Court of Appeals implicitly and indirectly sustained this no-evidence point when the 3-judge panel made the following remarkable and revealing statement on page 71 of its opinion: “We agree with the district court that the undercover agent’s discussion of purported drug proceeds with Freeman was relevant to establishing whether Freeman conspired with the undercover agent to perpetrate money laundering and thus could have been admitted even if the underlying money laundering charge had never been brought.” (Emphasis added.)
Why is the italicized-bolded portion of that statement so remarkable and revealing?
Two reasons:
One, the Court of Appeals is saying that the conspiracy charge is sustained by the fact that Freeman conspired with the federal undercover agent (secret undercover IRS agent Pavel Prilotsky) to perpetrate money laundering.
Two, and more important, the law is very clear that it is impossible for a person to criminally conspire with a government undercover agent, for the obvious reason: an undercover agent cannot, as a matter of law, be a party to a criminal conspiracy.
In other words, to prove a conspiracy, the government must prove that an agreement existed between two or more people to commit the crime. In this case, the crime is money laundering. The government had to prove that Freeman entered into an agreement with another person to launder money. But under well-established federal law, that other person cannot be a government undercover agent. The other person to the agreement must be someone who was an actual party to the criminal agreement. If the supposed agreement was between Freeman and the government undercover agent, as the Court of Appeals asserts in its opinion, then there is no conspiracy as a matter of fact and as a matter of law…
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