Kay Ellison v. UNITED STATES OF AMERICA On Appeal from the United States District Court for the…

PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
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No. 22-2169
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KAY ELLISON,
Appellant
v.
UNITED STATES OF AMERICA
________________
On Appeal from the United States District Court
for the District of New Jersey
(D.C. Civil No. 2-21-cv-16230)
District Judge: Honorable Susan D. Wigenton
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Argued: May 7, 2024
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Before: MATEY, MONTGOMERY-REEVES, and
ROTH, Circuit Judges
(Opinion filed: October 30, 2024)
Cara L. Brack [ARGUED]
Megan E. Farrell
Thomas S. Jones
Nelson Mullins
6 PPG Place
7th Floor
Pittsburgh, PA 15222
Counsel for Appellant

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Andrew Laing [ARGUED]
Jeremy R. Sanders
United States Department of Justice
Criminal Division, Fraud Section
1400 New York Avenue NW
Bond Building, 4th Floor
Washington, DC 20005
Counsel for Appellee
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OPINION OF THE COURT
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MATEY, Circuit Judge.
Ineffective assistance of counsel claims under the rubric
created in Strickland v. Washington turn on prejudice, “a
reasonable probability” that, but for the attorney’s error, “the
result of the proceeding would have been different.” 466 U.S.
668, 694 (1984). Kay Ellison argues her convictions for federal
wire fraud, bank fraud, and conspiracy violate the Sixth
Amendment because she relied on her attorney’s erroneous
advice that if she did not testify, she could not present other
evidence. Applying the familiar Strickland standard, we agree
with the District Court that there is no reasonable probability
that this alleged error changed the jury’s verdict. So we will
affirm the denial of her petition for a writ of habeas corpus.
I.
A.
Ellison, along with co-defendant Judy Tull, founded and
managed a now-defunct charter airline called Southern Sky Air
& Tours operating as Myrtle Beach Direct Air & Tours (Direct
Air). The Department of Transportation requires charter
operators to deposit passengers’ payments into an approved
bank account and keep the funds escrowed until the flight is
completed. 14 C.F.R. Part 380. But Direct Air had cash flow
problems. So Ellison siphoned millions of dollars out of the
escrow account through fictitious “dummy” passenger
reservations and falsified corporate records. When the scheme

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was uncovered, the United States charged both Ellison and Tull
with conspiracy to commit wire fraud and bank fraud in
violation of 18 U.S.C. § 1349, wire fraud in violation of 18
U.S.C. §§ 1343 and 2, and bank fraud in violation of 18 U.S.C.
§§ 1344 and 2.
Ellison and Tull proceeded to a jury trial, and Ellison
opted not to present a defense. Her counsel stated, outside the
presence of the jury, that he had “explained to [Ellison] the
decision to testify or not to testify was hers and hers alone to
make” and that Ellison had decided “not to testify and not to
call witnesses on her behalf.” App. 363. The trial court then
questioned Ellison on the record:
Court: All right. And have you had the
opportunity to discuss with [counsel], . . .
your right not to testify as well as your
right not to put on a case, as you have no
burden in this matter, the burden rests
with the Government for the entire
case[?] Have you had those discussions
with [counsel]?
Ellison: Yes, ma’am.
Court: And understanding, after you’ve
had those discussions with [counsel], has
it been your decision voluntarily to waive
your right to testify in this matter?
Ellison: Yes, ma’am.
App. 364–65 (emphasis added). The jury convicted Ellison and
Tull of all counts. Ellison was sentenced to ninety-four
months’ imprisonment and ordered to pay $19,663,429.50 in
restitution. We affirmed her convictions on direct appeal. See
United States v. Ellison, 804 F. App’x 153, 158 (3d Cir. 2020).
B.
Ellison then moved to vacate her sentence, pursuant to
28 U.S.C. § 2255, claiming her trial counsel incorrectly
advised her that if she declined to testify at trial, she could not
present other witnesses or evidence. Ellison argued this advice

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prejudiced her defense by depriving her of the opportunity to
contest key portions of the Government’s case.1 The District
Court denied Ellison’s motion without an evidentiary hearing
and declined to issue a certificate of appealability. In reaching
its decision, the District Court did not directly address Ellison’s
allegation that counsel erroneously advised her of a contingent
link between the right to testify and the right to present a
defense. Rather, the District Court concluded that, even
assuming Ellison could prove counsel was ineffective, her
claim would still fail because she could not show prejudice.2
Accepting as true Ellison’s statements of the nature of the
expected testimony,3 the District Court focused the prejudice
inquiry on “whether there is a reasonable probability . . . that if
Ellison had testified herself and presented the testimony of her
proposed witnesses, the jury would have acquitted.” App. 61.
And it found no such possibility:
Ellison’s defense, with or without the
proposed witness testimony, was
1 Ellison’s petition described her intended trial
testimony, as well her own “brief summary” of the intended
testimony of her twelve proposed witnesses. App. 129; see also
App. 127–33.
2 “Because failure to satisfy either prong defeats an
ineffective assistance claim, and because it is preferable to
avoid passing judgment on counsel’s performance when
possible,” courts often address the prejudice prong first where
it disposes of a petitioner’s claims. United States v. Cross, 308
F.3d 308, 315 (3d Cir. 2002).
3 Although Ellison swore to her own understanding of
what her proposed witnesses “were prepared to testify to” at
trial, App. 129, she did not provide any sworn statements from
the witnesses themselves. But showing Strickland prejudice
“may not be based on mere speculation about what the
witnesses . . . might have said.” United States v. Gray, 878
F.2d 702, 712 (3d Cir. 1989). Rather, “[u]nder usual
circumstances,” we expect that “information [obtainable
through an adequate investigation] would be presented to the
habeas court through the information of the potential
witnesses.” Duncan v. Morton, 256 F.3d 189, 202 (3d Cir.
2001) (alteration in original) (quoting Gray, 878 F.2d at 712).
Ellison made no such presentation.

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dependent on the jury concluding . . . that
the DOT regulation permitted (1) charter
airlines to sell vouchers and take
membership and luggage fees out of
escrow before passenger flights had been
completed; and (2) to withdraw from the
escrow account without flight by flight
accounting of the funds. The jury rejected
this argument and there is nothing about
the proposed defense testimony that
makes it . . . more persuasive in light of
the DOT’s position that voucher sales
were never permitted and withdrawals
from escrow required a flight by flight
accounting. The uncontradicted evidence
of Direct Air’s continuous losses and high
fuel bills makes it unlikely the jury would
believe the escrow shortage was caused
solely by undiscovered computer errors
and that there was no intent to deceive the
banks. Evidence of Ellison’s involvement
in running Direct Air makes it unlikely
the jury would conclude she was not
involved in the inflation of the year-end
financial statements.
App. 81.
A motions panel of this Court then granted Ellison a
certificate of appealability as to whether the District Court
should have addressed Ellison’s “assertion that her counsel
advised her that the right to testify was linked to the right to
present a defense.” 4 App. 83. The order directed the parties to
4 The motions panel denied a certificate of appealability
for all other claims, including whether Ellison demonstrated
prejudice under the outcome-based standard applied by the
District Court. But the panel also referred “[t]he question of
whether a certificate of appealability is required to challenge
the District Court’s denial of an evidentiary hearing.” App. 84.

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address “whether Ellison’s ineffectiveness claim should be
analyzed using the standard for prejudice set forth in Palmer v.
Hendricks, 592 F.3d 386, 397–99 (3d Cir. 2010), or whether
the analysis in Vickers v. Superintendent Graterford SCI, 858
F.3d 841, 857 (3d Cir. 2017), requires [this Court] to revisit
that standard.” App. 84.5
II.
Strickland announced the now-familiar test for claims
of ineffective assistance. First, “the defendant must show that
counsel’s performance was deficient.” 466 U.S. at 687.6
We agree with both Ellison and the Government that the
certificate of appealability statute applies only to “final
order[s]” in § 2255 proceedings, see 28 U.S.C.
§ 2253(c)(1)(B), and does not explicitly cover interlocutory
orders, such as the denial of a request for an evidentiary
hearing. See Harbison v. Bell, 556 U.S. 180, 183 (2009)
(explaining that § 2253(c)(1) refers to orders that “dispose of
the merits” of the proceeding). But that conclusion does not
affect our jurisdiction. An order denying an evidentiary hearing
on an ineffective-assistance claim is not independently
appealable under the collateral order doctrine. See In re Grand
Jury, 705 F.3d 133, 144–45 (3d Cir. 2012) (noting that to be
immediately appealable, an interlocutory order must be
“effectively unreviewable on appeal from the final judgment in
the underlying action”) (internal quotation marks omitted).
Rather, under the merger rule, that order would “merge into the
final judgment” denying the § 2255 motion itself, and then
“may be challenged on appeal from that judgment.” In re Diet
Drugs Prods. Liab. Litig., 418 F.3d 372, 377 (3d Cir. 2005).
That is what happened here.
5 The District Court exercised jurisdiction under 18
U.S.C. § 3231 and 28 U.S.C. § 2255. We have jurisdiction
under 28 U.S.C. §§ 1291, 2253(c)(1)(B), and 2255(d). On the
denial of a § 2255 motion, we “review legal conclusions de
novo and factual findings for clear error.” United States v.
Folk, 954 F.3d 597, 601 (3d Cir. 2020).
6 The District Court assumed that Ellison’s attorney was
ineffective, and we do the same. See App. 61; Cross, 308 F.3d
at 315.

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Second, “the defendant must show that the deficient
performance prejudiced the defense.” Id.
A.
“[P]rejudice is defined in different ways depending on
the context in which it appears.” Weaver v. Massachusetts, 582
U.S. 286, 300 (2017). When an attorney’s error occurs during
trial or another legal proceeding that is “sufficiently like a trial
in its adversarial format and in the existence of standards for
decision,”7 “[t]he defendant must show that there is a
reasonable probability8 that, but for counsel’s unprofessional
errors, the result of the proceeding would have been different.”
Strickland, 466 at 686–87, 694. In these cases, the prejudice
analysis is conceptually clear-cut because we generally
presume that trials and “trial-like” proceedings are reliable,
aside from the alleged error. Id. at 695 (“The assessment of
prejudice should proceed on the assumption that the
decisionmaker is reasonably, conscientiously, and impartially
applying the standards that govern the decision.”). So to
evaluate prejudice, we look at the “result of the proceeding”
and consider the likelihood that, absent the ineffective
assistance, that result “would have been different.” Id. at 693,
694.
B.
But where counsel’s misstep occurs outside trial or a
“trial-like” context, Strickland’s prejudice prong is less
intuitive. As a result, the Supreme Court has, at times,
retrofitted the test for claims arising from other stages of the
adjudicative process. For example, Hill v. Lockhart—decided
one year after Strickland—involved an ineffective-assistance
claim arising from a guilty plea. 474 U.S. 52, 53 (1985). There,
counsel allegedly misadvised the defendant about the length of
7 See Strickland, 466 U.S. at 686–87 (analogizing
capital sentencing to trial).
8 A “reasonable probability” means “a probability
sufficient to undermine confidence in the outcome.”
Strickland, 466 U.S. at 694. That requires a “substantial,” not
just a “conceivable,” likelihood of a different result.
Harrington v. Richter, 562 U.S. 86, 112 (2011).

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his statutorily required parole term, and the defendant claimed
that made his guilty plea involuntary and unintelligent. Id. at
55–56. The Court made clear that the “two-part Strickland
. . . test applies to challenges to guilty pleas based on
ineffective assistance of counsel.” Id. at 58. But on the
prejudice prong, it did not conduct a Strickland “outcome-
based” analysis—i.e., asking whether the defendant would
have still been convicted had he proceeded to trial rather than
pleading guilty. Instead, the Court adopted a “process-based”
standard, under which the defendant could demonstrate
prejudice merely by showing that, “but for counsel’s errors, he
would not have pleaded guilty and would have insisted on
going to trial.” Id. at 59.
Over several decades, the Court has only applied Hill’s
process-based standard for prejudice to a narrow class of
ineffectiveness claims, including where counsel deficiently
advised the defendant to reject a plea deal, see Lafler v.
Cooper, 566 U.S. 156, 163–64 (2012), or counsel failed to file
a notice of appeal, see Roe v. Flores-Ortega, 528 U.S. 470, 484
(2000). In those cases, the Court explained that the defendant
must instead show
a reasonable probability that the plea offer would have
been presented to the court (i.e., that the defendant
would have accepted the plea and the prosecution would
not have withdrawn it in light of intervening
circumstances), that the court would have accepted its
terms, and that the conviction or sentence, or both,
under the offer’s terms would have been less severe than
under the judgment and sentence that in fact were
imposed
Lafler, 566 U.S. at 164, or “a reasonable probability that, but
for counsel’s deficient failure to consult with him about an
appeal, he would have timely appealed,” Flores-Ortega, 528
U.S. at 484. In these cases, the Supreme Court has presumed
prejudice, “with no further showing from the defendant o[n]
the merits of [the] underlying claim[],” where the ineffective
assistance “rendered the proceeding presumptively unreliable
or entirely nonexistent.” Flores-Ortega, 528 U.S. at 484; see
also Lafler, 566 U.S. at 168–89.

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III.
Ellison argues that Strickland’s outcome-
based prejudice test is irrelevant because her counsel’s
ineffective assistance deprived her of both her right to testify
and her right to present a defense,9 and thus the process-based
prejudice test should apply. We disagree, and our decisions in
Palmer and Vickers explain why.
A.
As here, Palmer involved counsel allegedly failing to
advise that the defendant alone could decide whether to testify.
592 F.3d at 394. The petitioner later claimed that, had he been
properly advised, he would have told the jury “[his] side of
what really happened.” Id. at 390. But he did not offer any
details on his proposed testimony, let alone any factual analysis
of how his testimony would have swayed the jury. See id. at
395. Like Ellison, the petitioner in Palmer insisted that he was
not required to show prejudice to prevail on his claim because
depriving him of the right to testify is a “structural defect in the
entire trial process that requires automatic reversal[.]” Id. at
396–97 (internal quotation marks omitted). But we rejected
that argument, see id. at 397–99,10 and concluded there could
9 A right the Supreme Court announced in Rock v.
Arkansas, 483 U.S. 44, 51–53 (1987).
10 A conclusion shared by every other circuit court to
consider the issue, see Palmer, 592 F.3d at 397–98 (collecting
cases), and still consistent with more recent decisions, see, e.g.,
Hartsfield v. Dorethy, 949 F.3d 307, 312–16 (7th Cir. 2020)
(finding it “not reasonably probable that [the petitioner’s]
proposed testimony would have affected the jury’s verdict”
and noting “the unanimous weight of authority” rejecting the
contention that a defendant “need not show prejudice when the
case involves the right to testify”); Smith v. Dickhaut, 836 F.3d
97, 106 (1st Cir. 2016) (finding no prejudice in a right-to-
testify claim because petitioner failed to show “that, had he
testified, there is a reasonable probability that the outcome of
his trial would have been different”).

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be no prejudice under Strickland because the petitioner did not
show “‘that the decision reached’” at his trial “‘would
reasonably likely have been different absent the errors,’” id. at
395–96 (quoting Strickland, 466 U.S. at 696).
B.
Our decision in Vickers does not change the application
of the Strickland prejudice standard to the case before us.
There, the petitioner claimed ineffective assistance based on
counsel’s advice to forgo his right to a jury trial and choose a
bench trial instead. Vickers, 858 F.3d at 844–46. Following
Strickland, our precedent at the time required showing that a
jury trial would have resulted in a more favorable outcome than
the bench trial. See United States v. Lilly, 536 F.3d 190, 196–
97 (3d Cir. 2008). But Vickers reasoned that later Supreme
Court decisions like Lafler require applying the process-based
test for prejudice, not the traditional outcome-based prejudice
inquiry. 858 F.3d at 857.11 Accordingly, the question became
“whether the defendant can demonstrate a reasonable
probability that, but for counsel’s ineffectiveness, he would
have opted to exercise [the] right [at issue].” Id.
We have continued to demand prejudice in right-to-
testify cases since Palmer. See, e.g., Ruiz v. Superintendent
Huntingdon SCI, 672 F. App’x 207, 212 (3d Cir. 2016)
(finding “no reasonable probability that the outcome would
have been different had [the petitioner] testified at his trial”
because his “proposed testimony would not have changed an
objective factfinder’s view of all of the evidence”); United
States v. Aldea, 450 F. App’x 151, 153 (3d Cir. 2011) (finding
no prejudice because the petitioner’s testimony “would not
have undermined the verdict”). And we reaffirmed this aspect
of Palmer just over two years ago. See Lesko v. Sec’y Pa. Dep’t
of Corr., 34 F.4th 211, 236–37 (3d Cir. 2022).
11 We reasoned that our “holding regarding the
appropriate prejudice inquiry in this context” merely
“align[ed] Lilly with the Supreme Court’s subsequent decision
in Lafler,” and thus “d[id] not necessitate en banc review.”
Vickers, 858 F.3d at 857 n.15.

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IV.
The Palmer outcome-based prejudice standard, not the
Vickers process-based prejudice standard, controls here. This
is because showing “actual prejudice” is required where the
alleged error occurs within a judicial proceeding that is
otherwise “presumptively reliable.” Flores-Ortega, 528 U.S. at
484. That must include right-to-testify claims like Ellison’s,
because the error in those cases (i.e., failing to present
testimony from the defendant or other defense witnesses)
occurs “‘during the presentation of the case to the jury’ and
‘may therefore be quantitatively assessed in the context of
other evidence presented in order to determine’” what effect, if
any, it had on the jury’s verdict. Palmer, 592 F.3d at 397
(quoting Arizona v. Fulminante, 499 U.S. 279, 307–08 (1991)).
The prejudicial effect will necessarily depend on the
significance of the facts to which the defendant and her
witnesses might have testified, evaluated alongside the rest of
the evidence produced at trial. Id. at 399. So, following Palmer,
Ellison needed to show a reasonable probability that, but for
counsel’s errors, she would have exercised her trial rights, and
that doing so would have changed the result. That is the
analysis the District Court correctly conducted.12
The cases Ellison relies on are distinguishable because
they involved the forfeiture of entire proceedings to which the
defendant was entitled—a trial rather than a plea (Hill), an
appeal (Flores-Ortega), a plea rather than a trial (Lafler), and
a jury trial instead of a bench trial (Vickers). But that did not
happen here. Waiving the right to testify or call witnesses is
not tantamount to forfeiture of the entire proceeding, nor does
12 In so observing, we are mindful of the confines of the
certificate of appealability, limited to whether the District
Court applied the correct legal standard for prejudice under
Strickland. Because we hold that it did, we “will not consider”
arguments challenging the District Court’s conclusion after
applying that standard, as they are “not within the scope of the
issue on which we granted a certificate of appealability.”
Miller v. Dragovich, 311 F.3d 574, 577 (3d Cir. 2002).

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it render the trial per se “fundamentally unfair.”13 Strickland,
466 U.S. at 700; cf. Vickers, 858 F.3d at 857. Rather, “when a
defendant states, ‘I would have testified to X, Y, and Z, but my
attorney would not put me on the stand,’ the significance of
such testimony can be evaluated in the context of the remainder
of the evidence in order to assess the impact of the
constitutional violation.” Palmer, 592 F.3d at 399. We
conclude from this that Palmer’s outcome-based prejudice
standard is the appropriate one in Ellison’s ineffective-
assistance case.
* * *
“An error by counsel, even if professionally
unreasonable, does not warrant setting aside the judgment of a
criminal proceeding if the error had no effect on the judgment.”
Strickland, 466 U.S. at 691. Because Ellison failed to
demonstrate that her attorney’s alleged error affected the jury’s
verdict, we will affirm the District Court’s denial of her
petition for a writ of habeas corpus.
13 Of course, “[t]here are good tactical reasons why it
may not be best for the defendant to testify in some
circumstances.” United States v. Teague, 953 F.2d 1525, 1533
n.9 (11th Cir. 1992). “Some examples might be if the defendant
might provide evidence of missing elements of the crime on
cross-examination, if the defendant might be prejudiced by
revelation of prior convictions, or if the prosecutor might
impeach the defendant using a prior inconsistent statement.”
Id. It would thus misstate both law and common practice to
suggest that waiving the right to testify or call witnesses “so
undermine[s] the proper functioning of the adversarial process
that,” in general “the trial cannot be relied on as having
produced a just result.” Strickland, 466 U.S. at 686.

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