BOSTON, April 10 (Reuters) - The U.S. Justice Department

has lost its bid to convince a federal appeals court to break

with its counterparts in other circuit courts and rule that a

defendant's conviction does not get wiped away just because he

died while his appeal was pending.

The Boston-based 1st U.S. Circuit Court of Appeals on

Tuesday joined with all 11 other regional federal appeals courts

by recognizing a legal doctrine that requires former PixarBio

Corp CEO Frank Reynolds' securities fraud conviction to be

scrapped because he died in 2022.

Reynolds was found guilty in 2019 by a federal jury of

carrying out a scheme to mislead investors into believing he was

a successful inventor with a drug in development that would end

opioid addiction.

Prosecutors had said the claims he made about himself, the

drug and its regulatory approval timeline were overhyped and

untrue and that his goal was to defraud investors out of their

money, pump up the value of his company's stock and get rich in

the process.

He was sentenced in 2020 to seven years in prison and

ordered to forfeit $280,000 and pay $7.55 million in restitution

to his victims. Those financial orders will be vacated too,

which means prosecutors now would need to pursue a new civil

case against Reynolds' estate to recover money for his victims.

The court's ruling relied on the legal doctrine known as

"abatement ab initio," under which trial convictions are vacated

when defendants die before they can exhaust their appeals, as

Reynolds did.

Chief U.S. Circuit Judge David Barron, writing for Tuesday's

three-judge panel, said that doctrine was first applied in the

federal courts in the late 19th century with the rationale being

that defendants have a right to an appeal and death precludes

their convictions from being tested on appeal.

Prosecutors had called it an "unsound" practice that lacked

a constitutional basis and was inconsistent with laws like the

Mandatory Victims Restitution Act and Crime Victims Rights Act

that seek to respect victims' rights.

Prosecutors noted that 31 states have abandoned the

practice, including Massachusetts, whose high court in 2019

reinstated former NFL star Aaron Hernandez's murder conviction

following his suicide and deemed the doctrine "outdated."

But while Barron acknowledged several state high courts had

scrapped the practice, he said the U.S. Supreme Court has not,

nor has it cast doubt on what it described in 1971's Durham v.

United States as the "impressive" unanimity of the federal

appeals courts that have tackled the issue over the years.

"Given that direct appeals are no less integral to the

federal criminal process than they were at the time that the

Supreme Court described this still-reigning consensus as

'correct,' we see no reason to break with it," Barron wrote.

The case is U.S. v. Reynolds, 1st U.S. Circuit Court of

Appeals, No. 20-1268.

For the United States: Mark Quinlivan of the U.S. Attorney's

Office for the District of Massachusetts

For the opposing side: Judith Mizner of the Federal Defender

Office

Read more:

Convictions should outlive defendants' deaths, US tells

appeals court

Former PixarBio CEO convicted of defrauding biotech

investors

Biotech CEO, two associates accused by U.S. of securities

fraud

Murder conviction restored for Aaron Hernandez