United States’ Motion in Limine No. 2: To Preclude Defendant from Raising Use of PPP-Loan and EIDL-Loan Funds — United States v. Lucas (Dkt. 53, D. Utah)

Summary

The United States' Motion in Limine No. 2, filed November 6, 2024, in United States v. Carter Lane Lucas, Case No. 2:23-cr-00405 DBB, in the U.S. District Court for the District of Utah. Citing Fed. R. Evid. 401-403, the motion asks the Court to preclude Lucas and his counsel from raising evidence or argument about how he used the Paycheck Protection Program and Economic Injury Disaster Loan proceeds. The government states that it has charged wire fraud over about $182,800 in loan funds and has not charged improper use of those funds, and that defense counsel gave notice of intended testimony on their use (ECF No. 49). It argues such evidence would confuse the jury and invite nullification. The motion is signed by Special Assistant United States Attorney Sachiko J. Jepson.

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

Record facts

Full text

Case 2:23-cr-00405-DBB Document 53 Filed 11/06/24 PageID.295 Page 1 of 4




TRINA A. HIGGINS, United States Attorney (#7349)
TODD C. BOUTON, Assistant United States Attorney (#17800)
SACHIKO J. JEPSON, Special Assistant United States Attorney (#17077)
Attorneys for the United States of America
111 South Main Street, Suite 1800
Salt Lake City, Utah 84111-2176
Telephone: (801) 524-5682
todd.bouton@usdoj.gov; sachiko.jepson@usdoj.gov

                       IN THE UNITED STATES DISTRICT COURT
                                     DISTRICT OF UTAH


 UNITED STATES OF AMERICA,                        Case No. 2:23-cr-00405 DBB

                        Plaintiff,
                                                UNITED STATES’ MOTION IN LIMINE
                  v.                            NO. 2: TO PRECLUDE DEFENDANT
                                                FROM RAISING USE OF PPP-LOAN AND
 CARTER LANE LUCAS,                             EIDL-LOAN FUNDS

                        Defendant.
                                                 Judge David Barlow



      Pursuant to Fed. R. Evid. 401-403, the United States files this Motion in Limine No. 2 to

preclude Mr. Lucas and his counsel from raising or referencing any evidence or argument

regarding how Mr. Lucas used the Paycheck Protection Program Loan (“PPP Loan”) and

Economic Injury Disaster Loan (“EIDL Loan”) proceeds he fraudulently obtained.

    Case 2:23-cr-00405-DBB Document 53 Filed 11/06/24 PageID.296 Page 2 of 4




        MEMORANDUM OF LAW IN SUPPORT OF MOTION IN LIMINE NO. 2

     1. INTRODUCTION

         The United States has charged Mr. Lucas with wire fraud, alleging that he misrepresented

his criminal history to fraudulently obtain about $182,800 in emergency loan funds that he did not

qualify to receive. But for this motion, what is more important is that the United States has not

charged Mr. Lucas with improper use of the fraudulently obtained loan funds.

         Notwithstanding, defense counsel for Mr. Lucas has recently provided notice that they

intend to present testimony at trial regarding how Mr. Lucas used his fraudulently obtained PPP-

and EIDL-Loan funds. (ECF No. 49, at 2). 1 However, a breakdown of Mr. Lucas’s use of these

funds is not relevant to whether he obtained them fraudulently in the first place.

     2. AT TRIAL, MR. LUCAS SHOULD BE PRECLUDED FROM RAISING HIS USE
        OF THE PPP- AND EIDL-LOAN FUNDS

         A defendant should be precluded from raising improper legal defenses, to avoid confusing

or prejudicing the jury or inviting jury nullification. Fed. R. Evid. 402, 403. In this case, the jury

will be asked to determine whether Mr. Lucas committed wire fraud when he obtained PPP- and

EIDL-Loan funds by representing in his responses to two separate criminal history questions (on

the same day) that he did not have a disqualifying criminal history. 2 Wire fraud charges do not

require proof that a defendant misused fraudulently obtained funds. They require the United States

to show that the defendant engaged in a scheme to defraud or a scheme to obtain money or property



1
 Mr. Lucas has retained an expert witness, in part, to “testify regarding Mr. Lucas’s use of the $17,000 in Paycheck
Protection Program (PPP) loan proceeds . . . to pay his own payroll costs during the loan’s 8-week covered period.”
The witness would also “testify about Mr. Lucas’s use of proceeds from his Economic Injury Disaster Loan (EIDL)
proceeds.” (ECF No. 49 at 2).
2 For wire fraud, the United States must prove that the defendant (1) devised or intended to devise a scheme to defraud,
(2) acted with specific intent to defraud, (3) used or caused the use of interstate or foreign wire communications
facilities, and (4) whether the scheme employed false or fraudulent pretenses, representations, or promises that were
material. 10th Cir. Crim. Pattern Jury Instr’n No. 2.57.

                                                           2

    Case 2:23-cr-00405-DBB Document 53 Filed 11/06/24 PageID.297 Page 3 of 4




by means of false or fraudulent pretenses, representations, or promises that were material. United

States v. Zar, 790 F.3d 1036, 1049-50 (10th Cir. 2015). Likewise, in a false statement case under

18 U.S.C. § 1014, where the defendant was charged with fraudulently obtaining loan funds, the

court found that “the defendant’s specific plans regarding what he will do with the funds once he

obtains them is not an element of the offense. [Th]ere the intended personal use allegations were

merely surplusage and the prosecution did not have to prove them.” U.S. v. Smith, 838 F.2d 436,

439-440 (10th Cir. 1988) (emphasis added). The same reasoning and logic applies here.

         Mr. Lucas may attempt to show that he used PPP- and EIDL-Loan funds for payroll and

working capital to argue that there was no misuse. The United States contends that there is no

“appropriate” use for fraudulently obtained funds, other than to return them. More importantly,

however, even if Mr. Lucas could show there was no misuse, this would have little if any probative

value for a jury considering how he obtained the funds. “[A] scheme to defraud is not dependent

on what someone intends to do or has done with the money or property acquired through the

scheme. Instead, it is the scheme itself—the act of acquiring or attempting to acquire the funds

through fraudulent means—that the statute punishes. United States v. Robinson, 99 F.4th 344, 355

(6th Cir. 2024). 3

         Obtaining funds and using funds are two distinct series of acts. Presenting a jury with

evidence about Mr. Lucas’s use of funds—Act 2—will not help them ascertain Mr. Lucas’s

criminal intent in obtaining those funds—Act 1. If Mr. Lucas somehow misunderstood two

separate criminal history questions on two separate applications and inadvertently obtained funds


3
  Robinson cites to the Supreme Court case McNally v. United States, which states that “[i]nsofar as the sparse
legislative history [regarding mail fraud] reveals anything, it indicates that the original impetus behind the mail fraud
statute was to protect the people from schemes to deprive them of their money or property.” 483 U.S. 350, 356 (1987)
(superseded by statute). Tenth Circuit caselaw provides that “[i]nterpretations of § 1341 [mail fraud] are authoritative
in interpreting parallel language in § 1343 [wire fraud].” United States v. Lake, 472 F.3d 1247, 1255 (10th Cir. 2007).



                                                           3

  Case 2:23-cr-00405-DBB Document 53 Filed 11/06/24 PageID.298 Page 4 of 4




he was not qualified to receive, he could theoretically have intended to both properly obtain and

properly use the funds. But it is just as plausible that he was motivated to make false representations

on his loan applications because he wanted the funds for payroll and working capital. There is no

form of use in Act 2 that sanitizes his criminal intent in Act 1.

    3. CONCLUSION

       The United States charged Mr. Lucas only for fraudulently obtaining emergency loan

funds. Any evidence regarding his criminal intent (or lack thereof) to commit a second crime of

misuse is irrelevant. Rather than assist the jury, it would lend to confusion, invite the jury to

conflate the criminal intent for separate crimes, and plant a seed of improper jury nullification.

Because any probative value of this evidence is substantially outweighed by a danger of unfair

prejudice, confusion, misleading the jury, and wasting time, the Court should preclude it.

               RESPECTFULLY SUBMITTED,

                                               TRINA A. HIGGINS
                                               United States Attorney


                                               /s/ Sachiko J. Jepson________________
                                               SACHIKO J. JEPSON
                                               Special Assistant United States Attorney




                                                  4

File and source

File

gov.uscourts.utd.144087.53.0.pdf

Size

187,326 bytes

SHA-256

7c7ae426d98f9ca8656839c4e5880449453e3ecc876c78fa5d16b4f3f1b3c057

Our copy

gov.uscourts.utd.144087.53.0.pdf

Original

archive.org