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More felony convictions overturned as 'Fat Leonard' case unravels

The exterior of the Edward J. Schwartz Federal Building and U.S. Courthouse is seen on Feb. 26, 2024. San Diego, Calif.
Carlos Castillo
The exterior of the Edward J. Schwartz Federal Building and U.S. Courthouse is seen on Feb. 26, 2024. San Diego, Calif.

Five former military officers who altogether admitted to accepting almost $400,000 in bribes from a Navy contractor had their felony convictions overturned in a San Diego court Tuesday.

It's the latest fallout from a 2022 ruling in which Judge Janis Sammartino said federal prosecutors committed "serious misconduct" in the so-called "Fat Leonard" case, including withholding potentially exculpatory evidence from defense attorneys.

Sammartino said in court Tuesday the "unraveling" of the long-running case is a "tragic chapter for the Navy and an embarrassment for the government."


Despite the ruling to overturn the convictions, Sammartino said neither the guilty pleas or case documents will be struck from the record.

"Nothing is saying these men are not guilty," Sammartino said.

For decades Leonard Glenn Francis bribed scores of military officials, including influential fleet staff officers, with lavish gifts in exchange for classified Navy ship schedules in the western Pacific.

Charging documents allege the former officers — Marine Col. Enrico DeGuzman, Navy Capt. Donald Hornbeck, Cmdr. Steve Shedd, Cmdr. Jose Luis Sanchez and Chief Warrant Officer Robert Gorsuch — traded classified information for luxury gifts, travel, meals, prostitutes and cash.

Francis, who pleaded guilty for his role in the scheme in 2015, admitted he used this information to the advantage of his ship husbanding company, Glenn Defense Marine Asia. He'd then use fake invoices signed off by Navy officers under his sway to overcharge the Navy for his services.


He pleaded guilty to bilking the Navy out of at least $35 million.

Cmdr. Jose Luis Sanchez pleaded guilty to felony charges of bribery and conspiracy to commit bribery in 2015. At the time he admitted to accepting prostitutes, luxury travel and $100,000 cash from Francis.

After his felony conviction was overturned Tuesday, Sanchez pleaded guilty to one charge of unauthorized disclosure of information, a misdemeanor. He was given a $100 fine.

DeGuzman, Hornbeck and Gorsuch each pleaded guilty to the same offense and were assessed the same fine.

Shedd, a former 7th Fleet staff officer and ship commander, pleaded guilty to two counts of conspiracy in 2022. He admitted to accepting prostitutes, vacations, his-and-her luxury watches and cash worth more than $100,000.

After pleading guilty, Shedd testified against co-conspirators at trial. Because of this, federal prosecutors Tuesday agreed to withdraw Shedd's indictment completely.

The officers Shedd helped convict in 2022 similarly had their convictions overturned last year.

More than two dozen Navy officials pleaded guilty to bribery and conspiracy charges over the last 10 years. Attorneys for some were in court Tuesday but declined to comment on whether more defendants plan to seek relief on their convictions.

Francis remains in federal confinement in San Diego awaiting sentencing. He'll face charges for fleeing house arrest for Venezuela in 2022 after he's sentenced for his 2015 conviction.