Court filing
TRIAL BRIEF by USA as to Stephanie Hockridge — Blueacorn (Dkt. 155)
Summary
The government's trial brief concerning an SBA witness in United States v. Stephanie Hockridge, No. 4:24-cr-00287-O, in the U.S. District Court for the Northern District of Texas, filed May 7, 2025 as Document 155. It responds to the defendant's stated objection that the witness, an attorney employed by the Small Business Administration who worked on the Paycheck Protection Program, was not noticed as an expert. The brief states that the witness will testify about what the PPP was and the SBA's procedures and policy terms, based on knowledge gained in her employment. Citing United States v. Moparty and other decisions under Federal Rule of Evidence 701, it argues such testimony is admissible without expert designation and distinguishes United States v. Okoroji. The 6-page brief asks that any objections be overruled.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
No. 4:24-cr-00287-O · Doc. 155 · Docket on CourtListener
Full text
Case 4:24-cr-00287-O Document 155 Filed 05/07/25 Page 1 of 6 PageID 1745
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF TEXAS
FORT WORTH DIVISION
UNITED STATES OF AMERICA
v. No. 4:24-CR-287-O
STEPHANIE HOCKRIDGE (02)
a/k/a STEPHANIE REIS
GOVERNMENT’S TRIAL BRIEF CONCERNING SBA WITNESS
The United States, by and through the undersigned counsel, hereby submits this
trial brief concerning a witness from the Small Business Administration (SBA) it intends
to call in the upcoming trial of Defendant Stephanie Hockridge. The Defendant has
signaled her intention to object to the government’s SBA witness because the witness
was not noticed as an expert. See Dkt. 144 at 4-5.
The government’s witness, Kandace Zelaya, is an attorney currently employed by
the SBA who, in that capacity, worked on the Paycheck Protection Program (PPP). She
will testify about what the PPP was, as well as the procedures and policy terms used by
her employer, the SBA, in relation to the PPP. She will not offer any sophisticated
opinions about the efficacy of the SBA’s regulations or opine about whether the
Defendant complied with them. Her testimony will be factual, and it will be based on
knowledge she has acquired during the course of her employment with the SBA.
The Fifth Circuit has repeatedly held that precisely this type of testimony is
admissible without expert designation. See United States v. Moparty, 11 F.4th 280, 295-
96 (5th Cir. 2021) (in health care fraud case, affirming admission of non-expert testimony
Government’s Trial Brief Concerning SBA Witness – Page 1
Case 4:24-cr-00287-O Document 155 Filed 05/07/25 Page 2 of 6 PageID 1746
from insurance company representatives that “largely related to the procedures, policy
terms, and fraud prevention protections at each insurance company”); Nat’l Hispanic
Circus, Inc. v. Rex Trucking, Inc., 414 F.3d 546, 551-52 (5th Cir. 2005) (“[Federal Rule
of Evidence 701] does not exclude testimony by corporate officers or business owners on
matters that relate to their business affairs, such as industry practices and pricing.”);
Texas A&M Research Found. v. Magna Transp., Inc., 338 F.3d 394, 403 (5th Cir. 2003)
(“[A]n officer or employee of a corporation may testify to industry practices and pricing
without qualifying as an expert.”); see also United States v. Agee, No. 1:19-cr-00103-
TWP-DLP, 2021 WL 2894784, at *2 (S.D. Ind. July 9, 2021) (granting in part motion to
admit testimony from SBA witnesses because the witnesses “acquired their knowledge of
SBA rules and practices during the course of their employment with the SBA, and their
testimony will be limited to their personal knowledge of SBA rules and practices”).
For example, in Moparty, the Fifth Circuit approved the admission of lay opinion
testimony from representatives of health insurance companies “largely related to the
procedures, policy terms, and fraud prevention protections at each insurance company.”
11 F.4th at 295. A representative from Blue Cross Blue Shield “addressed how the
company would handle various situations, how it interpreted terms and policies, and how
their policies compared to those of the industry,” while an Aetna representative’s
testimony “focused on Aetna’s policies and practices.” Id. The Fifth Circuit held that
“[t]hese witnesses’ admissible testimony provided factual information about the
circumstances of the case.” Id. at 295-96 (quotation marks omitted). Similarly, here, Ms.
Zelaya’s testimony would provide factual information about the PPP.
Government’s Trial Brief Concerning SBA Witness – Page 2
Case 4:24-cr-00287-O Document 155 Filed 05/07/25 Page 3 of 6 PageID 1747
In its analysis, the Fifth Circuit cited the Sixth Circuit’s decision in United States
v. Kerley, 784 F.3d 327 (6th Cir. 2015), which observed, “In a number of decisions from
other circuits, courts have permitted witnesses to give lay opinion testimony about a
business’s policies, practices, or procedures, based on an after-the fact review or analysis
of documents or facts, if the witness’s testimony derived from personal knowledge
gained through participation in the business’s day-to-day affairs.” Kerley, 784 F.3d at 337
(citing, among other cases, United States v. Valencia, 600 F.3d 389 (5th Cir. 2010)); see
also Moparty, 11 F.4th at 295. Kerley also held that “[t]he fact that neither witness was
personally involved in the loan transactions at issue does not preclude their testimony
under Rule 701.” Kerley, 784 F.3d at 337; see also United States v. Powers, 578 F. App’x
763, 767-72 (10th Cir. 2014) (affirming, on plain error review, admission of testimony
from employees at victim lenders who were not personally involved in transactions but
had “personal knowledge of their respective employers’ lending practices at the time the
transactions took place and, by the time of trial, had become familiar with the specific
loan documents as well”); id. at 771 (“Mr. Powers’s argument is undermined by
decisions in a number of other circuits explaining that lay witnesses may, consistent with
Rule 701(a), testify broadly regarding an employer’s practices, policies, and procedures,
so long as their testimony is derived from personal knowledge and experience at the
business.”) (citing, among other things, Valencia, 600 F.3d at 416).
The Defendant does not engage with any of this authority permitting the SBA
witness’s testimony. Instead, she cites a decision from this Court in a health care fraud
case finding that the government’s Medicare witness was an expert because Medicare
Government’s Trial Brief Concerning SBA Witness – Page 3
Case 4:24-cr-00287-O Document 155 Filed 05/07/25 Page 4 of 6 PageID 1748
“‘operates within a complex and intricate regulatory scheme and we cannot say that the
average lay person, including any Medicare beneficiary, commands a working knowledge
of Medicare reimbursement procedures.’” See United States v. Okoroji, No. 3:15-CR-
00559-O, 2018 WL 8756433, at *1 (N.D. Tex. June 1, 2018) (quoting United States v.
White, 492 F.3d 380, 403 (6th Cir. 2007)). However, the witness in that case worked as
an investigator for a third-party Medicare contractor, see id. at *2; see also United States
v. Okoroji, N.D. Tex. No. 15-cr-559, Dkt. 176 (describing witness’s professional
background), a distinction that another court in this district has found significant. See
United States v. Stroud, No. 3:19-CR-00439-X, 2022 WL 1063029, at *5 (N.D. Tex. Apr.
8, 2022) (in illegal health care kickbacks case, distinguishing Moparty and determining
that government’s Medicare contractor witness was an expert because, in Moparty,
“unlike here, the representatives testified to the policies and procedures of the companies
they worked for”).
Unlike in Okoroji, the SBA witness here is currently an SBA employee and was so
employed during the PPP, when she worked extensively on the program. She will be
testifying about her employer’s procedures and policy terms related to PPP. See Moparty,
11 F.4th at 295. Ms. Zelaya’s knowledge is derived from her duties held at the SBA and
her testimony will be based upon personal knowledge and experience she gained while
employed there. See Valencia, 600 F.3d at 416 (“Because Labhart’s knowledge and
analysis were derived from duties he held at Dynegy, his opinions were admissible as
testimony based upon personal knowledge and experience gained while employed by
Dynegy.”).
Government’s Trial Brief Concerning SBA Witness – Page 4
Case 4:24-cr-00287-O Document 155 Filed 05/07/25 Page 5 of 6 PageID 1749
Okoroji is further distinguishable because it concerned the testimony of a witness
about technical aspects of Medicare billing—dense material full of jargon and codes not
accessible to a lay person—whereas this case is about straightforward misrepresentations
in PPP applications and those who knowingly participated in such fraud. The SBA,
including through the PPP application form that every applicant initialed and signed,
made clear that applicants were required to provide truthful and accurate information—
such as basic information like income, number of employees, and that the business was
active on February 15, 2020. The applications and requirements at issue in this case were
therefore accessible to the general public, not merely to medical billing specialists with
specialized training and knowledge. There was nothing that the applicants—or those who
knowingly facilitated the applicants’ fraudulent loans—needed to know regarding the
PPP that is technical or specialized. Ms. Zelaya’s testimony therefore will not cover
anything beyond the skill or understanding of a lay person.
The non-expert testimony the government intends to offer through Ms. Zelaya is
clearly permitted, and any objections to it by the Defendant should be overruled.
Respectfully submitted,
CHAD E. MEACHAM
ACTING UNITED STATES ATTORNEY
s/ Matthew Weybrecht
MATTHEW WEYBRECHT
Assistant United States Attorney
State Bar of Texas No. 24102642
Telephone: 817-252-5200
Fax: 817-252-5455
matthew.weybrecht@usdoj.gov
Government’s Trial Brief Concerning SBA Witness – Page 5
Case 4:24-cr-00287-O Document 155 Filed 05/07/25 Page 6 of 6 PageID 1750
LORINDA I. LARYEA
ACTING CHIEF, FRAUD SECTION
s/ Philip Trout
PHILIP TROUT
Acting Assistant Chief
Fraud Section
U.S. Department of Justice
MARGARET A. MOESER
CHIEF, MONEY LAUNDERING & ASSET
RECOVERY SECTION
Criminal Division, U.S. Department of Justice
s/ Elizabeth R. Carr
ELIZABETH R. CARR
J. RYAN MCLAREN
Trial Attorneys
Money Laundering and Asset Recovery Section
U.S. Department of Justice
CERTIFICATE OF SERVICE
I hereby certify that on May 7, 2025, I electronically filed the foregoing document
with the clerk for the U.S. District Court, Northern District of Texas, using the electronic
case filing system of the court. The electronic case filing system sent a “Notice of
Electronic Filing” to the attorney(s) of record who have consented in writing to accept
this Notice as service of this document by electronic means.
s/ Matthew Weybrecht
MATTHEW WEYBRECHT
Assistant United States Attorney
Government’s Trial Brief Concerning SBA Witness – Page 6
File and source
- File
- gov.uscourts.txnd.396981.155.0.pdf
- Size
- 202,647 bytes
- SHA-256
- a2127d4428a268057257aa65aaf7ca1616e58fc5f28422c53887efa3b8b42fbb
- Original
- archive.org