Reply to Response to Motion by Eric Dean Sheppard re 205 Motion for Acquittal — USA v. Sheppard (Dkt. 218, S.D. Fla.)

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U.S. District Court for the Southern District of Florida · No. 1:22-cr-20290-BB · Doc. 218 · 2024-03-11 · Docket on CourtListener

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UNITED STATES DISTRICT COURT 
SOUTHERN DISTRICT OF FLORIDA 
CASE No. 22-20290-CR-BLOOM/OTAZO-REYES 
 
UNITED STATES OF AMERICA, 
 
vs.  
 
ERIC DEAN SHEPPARD, 
 
 
 
Defendant. 
_______________________________/  
 
DEFENDANT’S REPLY IN SUPPORT 
OF MOTION FOR JUDGMENT OF ACQUITTAL 
Defendant Eric Dean Sheppard, by and through undersigned counsel, pursuant to Rule 
29(c) of the Federal Rules of Criminal Procedure, respectfully submits this reply brief in support 
of his motion for acquittal [D.E. 205], and states as follows: 
INTRODUCTION 
Sheppard’s convictions for aggravated identity theft should be vacated under Dubin v. 
United States, 599 U.S. 110 (2023). Dubin holds that the use of someone’s identity constitutes 
aggravated identity theft only when it is “at the crux” of the underlying crime.  Here, the underlying 
crime is wire fraud. At the crux of that crime were misrepresentations about Sheppard’s 
businesses’ eligibility for PPP loans. According to the government, Sheppard used his accountant’s 
identity to “lend credibility” to those misrepresentations. But lending credibility to a fraud, by 
definition, cannot be at its crux. Sheppard’s alleged misrepresentations about his accountant’s 
identity are not what “made the [underlying] conduct fraudulent.” Id. at 132. This fatal defect 
requires judgment of acquittal on the aggravated identity theft convictions. In addition, there was 
no evidence that the use of the accountant’s identity even “len[t] credibility” to the 
misrepresentations about Sheppard’s businesses. The government identifies no such evidence in 
its opposition. Sheppard’s aggravated identity theft convictions should be vacated for this reason 
as well. 
Sheppard’s wire fraud convictions should be vacated because he did not devise a scheme 
to harm to a traditional property interest. In its response brief, the government argues that Sheppard 
defrauded either the Small Business Administration (“SBA”) or the lending banks. Neither 
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argument works. Sheppard did not obtain any property from the SBA—he did not obtain the SBA’s 
money, nor did he obtain loan guarantees the SBA made to the banks. And the banks got exactly 
what they bargained for: Sheppard’s misrepresentations about his businesses’ eligibility to 
participate in PPP were not material to the banks’ financial interest (i.e., property interest) in the 
transaction. They bargained for and received loans that are being repaid according to their terms, 
in addition to processing fees. To be sure, the government claims that its  regulatory interest in 
controlling access to the PPP program was thwarted. But such a harm cannot support a wire fraud 
conviction. 
For these and the reasons set out below, the Court should enter a judgment of acquittal on 
all counts of conviction. 
DISCUSSION 
I. 
SHEPPARD’S AGGRAVATED IDENTITY THEFT CONVICTIONS ARE 
INVALID 
A. 
A Lie That Merely “Supports” A Fraud Is Not “At The Crux” Of The Fraud 
The Supreme Court’s decision in Dubin requires a careful evaluation of the relationship 
between the defendant’s use of someone’s identity and the underlying fraud. Under Dubin, a 
defendant is guilty of aggravated identity theft only when his use of someone’s identity “is at the 
crux of what makes the conduct criminal.” 599 U.S. at 131. Here, the dispositive question is 
whether Sheppard’s use of Cupersmith’s identity “is at the crux of” his wire fraud. 
 
There is no dispute about the crux of the government’s case for wire fraud. As the Court 
has already held, “the crux of the Wire Fraud in this case is Sheppard’s misrepresentations about 
the nature of his worker’s employment relationship, i.e., whether those workers were employees 
or independent contractors.” [D.E. 170 at 12]. The government’s opposition brief confirms this 
understanding: at the crux of the fraud were lies about having W2 employees and the nature of 
Sheppard’s businesses. [D.E. 214 at 12-20; see also D.E. 215 at 5]. 
 
The government’s theory is that Sheppard committed aggravated identity theft because he 
used Cupersmith’s identity to “lend credibility,” [01/11/24 Tr. AM (Closing Arg) at 18]; see also 
[D.E. 214 at 26], to loan applications that, again, were fraudulent because they misrepresented the 
characteristics of Sheppard’s businesses. That is not aggravated identity theft under Dubin. By 
definition, a lie that provides “support[]” for a fraud, [D.E. 214 at 13, 25], is not “at the crux” of 
the fraud. In common parlance, “crux” means “a main or central feature,” (Merriam-Webster’s 
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Collegiate Dictionary, Crux, 11th ed. 2020), “a crucial point,” (Merriam-Webster Dictionary, 
Crux, 2023), or “the most important” part, (Oxford Advanced Learner’s Dictionary, Crux, 10th 
ed.  2020). In the words of Dubin, the defendant’s use of the identity must be “a key mover in the” 
fraud and play a “central role.” 599 U.S. at 123. Conduct that merely supports or lends credibility 
to a fraud does not satisfy any of these definitions. It would stretch the English language beyond 
its breaking point to argue, as the government does, that providing support for a fraud is also at the 
crux of the fraud. See, e.g., [D.E. 214 at 27]. “Crux” and “support” are mutually exclusive.1 
 
At the same time Dubin announced this crux-of-the-fraud test, the Court also made 
expressly “clear” that “being at the crux of the criminality requires more than a causal relationship, 
such as ‘facilitation’ of the offense or being a but-for cause of its ‘success.’” Id. at 131. Yet that is 
exactly what the government’s credibility/support theory argues. In the government’s view, the 
banks were more likely to approve Sheppard’s loan applications because Cupersmith’s identity (in 
truth, his professional certification as an accountant, not his personal identity) allegedly “lent 
credibility” to Sheppard’s other lies about the nature of his businesses. [D.E. 214 at 24-25, 27]. If 
there was evidence that the use of the accountant’s name had this effect, Cupersmith’s identity 
may have “facilitate[d]” the fraud. See Black’s Law Dictionary, Facilitate (“To make the 
commission of (a crime) easier).”). The government told the jury that Sheppard forged 
Cupersmith’s signature to “move [the] fraud along.” [01/11/24 Tr. AM (Rebuttal Arg) at 18].  But 
under Dubin, that is simply not enough. 
 
The government’s contrary argument misreads Dubin. The government contends that it 
was sufficient that Sheppard “used Mr. Cupersmith’s identity in a manner that was fraudulent or 
deceptive.” [D.E. 214 at 25]. In other words, the government says that Section 1028A applies 
whenever a defendant satisfies the common definition of “identity theft.”  But Section 1028A does 
not punish common “identity theft,” nor is it a general anti-forgery statute. See [D.E. 205 at 4]. It 
 
1 If the government is right about the record, there is a better word to describe Sheppard’s alleged 
use of Cupersmith’s identity: “ancillary.” Ancillary means supplementary or subordinate. See 
Black’s Law Dictionary, Ancillary (11th ed. 2019). On the government’s theory, Sheppard’s use 
of Cupersmith’s identity was supplementary to the fraud in that it was an added reason the fraud 
might ultimately succeed—in the government’s view, the banks were more likely to credit lies 
about W-2 wages if they appeared on a form signed by an accountant. And the use of Cupersmith’s 
identity was subordinate in the sense that it was secondary to alleged lies about the nature of his 
businesses, which everyone agrees was the “crux” of the fraud. Dubin held that an “ancillary” use 
of someone’s identity is not aggravated identity theft. 599 U.S. at 132. 
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punishes aggravated identity theft, which means identity theft committed “during and in relation 
to” a predicate crime. 28 U.S.C. § 1028A; Dubin, 599 U.S. at 123-24, 127-28. That is why the 
statute requires a mandatory, consecutive, two-year prison term. And in Dubin, the Supreme Court 
held that a defendant uses someone’s identity “during and in relation to” a predicate crime only 
where that use is “at the crux of what made the underlying [conduct] fraudulent.” 599 U.S. at 131-
32. Thus, even if Sheppard lied about Cupersmith’s identity, the Court still must find that this lie 
was “at the crux of” the wire fraud. And for all reasons just described, this Court cannot do so.2 
 
The Eleventh Circuit’s decision in United States v. Gladden, 78 F.4th 1232 (11th Cir. 
2023), cannot save the government’s conviction. The government first asserts that Gladden did 
not ask whether the defendant’s “misuse of several doctor’s names was the crux” of the criminality, 
“but rather whether her misuse was at the crux” of the criminality. [D.E. 214 at 23]. If there is a 
difference between “the crux” and “at the crux,” it is not material to this case.3 Sheppard’s use of 
Cupersmith’s identity was no more “at the crux” of the wire fraud than it was “the crux” of the 
wire fraud. The government’s point seems to be that there can be multiple cruxes of a fraud. [D.E. 
214 at 23]. We agree. The problem for the government is that Sheppard’s use of Cupersmith’s 
identity was not one of them—at the risk of repetition, the cruxes of the wire fraud here were 
misrepresentations about W-2 employees and the industry in which Sheppard’s businesses 
operated, not Cupersmith’s identity. 
 
That distinguishes this case from Gladden. As the government notes, the defendant in 
Gladden lied about “by whom certain prescriptions were authorized” and whether “they were 
medically necessary.” [D.E. 214 at 23]. Both lies were at the crux of the fraud because insurance 
 
2 In the Court’s January 5 Order, the Court stated“[t]he focus of the Court’s inquiry” was on 
“whether the evidence supports that Sheppard ‘used’ the means of identity within the meaning of 
§ 1028A—that is, use that fits within the ordinary meaning of identity theft, as opposed to any 
other form of use—not whether that ‘use’ was ‘at the crux’ of the wire fraud.” [D.E. 170 at 14]. 
Respectfully, that analysis is incorrect for the same reason the government’s argument is incorrect. 
Under Dubin, the focus must be on whether Sheppard’s use of Cupersmith’s identity was at the 
crux of the wire fraud. The commission of ordinary identity theft is not enough. 
3 In attempting to draw this distinction, the government is picking up on “some definite-article 
inconsistency,” noted by Justice Gorsuch in his concurrence (which would have invalidated 
Section1028A as vague). Dubin, 599 U.S. at 135 (Gorsuch, J., concurring). It is true that the Court 
used the verbal formulation “at the crux,” but it is also true that the Court used the phrase “the 
crux.” Dubin, 599 at 132. That the Court used these formulations interchangeably and rejected 
Justice Gorsuch’s concurrence shows that the phrases are meant to mean the same thing. 
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companies will not reimburse prescriptions unless they are authorized by a doctor and are 
medically necessary. In this way, the defendant’s “use of Dr. Almirol’s identity was central to the 
deception”—the underlying conduct was fraudulent in part because the defendant lied about who 
wrote the prescription. Gladden, 78 F.4th at 1245. But that is not this case. Sheppard did not 
commit wire fraud because he lied about who his accountant was. The government claimed he 
committed wire fraud because he allegedly lied about the nature of his businesses. In the 
government’s words, Cupersmith’s identity played a “supporting,” [D.E. 214 at 25], not “central” 
role in the fraud, Gladden, 78 F.4th at 1245.   
This Court should not endorse a conviction that is out of step with every relevant appellate 
precedent. Because Sheppard’s alleged “use of [Cupersmith’s] name was not at the crux of what 
made [his PPP loan applications] fraudulent,” his convictions must be vacated. Dubin, 599 U.S. at 
132.4 
B. 
As A Matter Of Fact, Cupersmith’s Identity Did Not Lend Support To The 
Fraud 
Sheppard’s aggravated identity theft convictions should also be vacated because the 
government’s interpretation of the evidence is unsupported. The undisputed facts at trial establish 
that Cupersmith’s name played no causal role in the fraud. And because it played no causal role, 
it cannot possibly be “at the crux” of the fraud. The prosecution here is thus considerably weaker 
than the one in Dubin, where the defendant’s use of his patient’s identity was at least a necessary, 
but-for cause of the fraud’s success. 
1.  No one relied on the tax forms on which Cupersmith’s name appeared. As Sheppard 
demonstrated in his motion, there was no evidence that the tax forms containing Cupersmith’s 
identity were relied on by either bank. [D.E. 205 at 8-13]. The government’s opposition brief 
leaves this argument substantively unrebutted.   
Northeast Bank / ACAP. To start, there was no evidence Northeast Bank even requested 
the tax form on which Cupersmith’s name appeared. The government speculates that the bank may 
 
4 The government’s reliance on United States v. Fullerton, 2023 WL 6150782 (W.D. Tex. Sept. 
20, 2023), a district court case from outside this circuit, is misplaced. Fullerton makes the same 
mistake as the government. Fullerton concluded that it was sufficient that the misuse of someone’s 
identity “lend credibility” to the fraud, id. at *4, but there is no way to square that conclusion with 
Dubin. Fullerton is also inapt procedurally. Fullerton was a motion to dismiss, in which the Court 
had to take the allegations as true. Here, as discussed below, there is no evidence the accountant’s 
identity played any role in the fraud. 
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have requested the tax form (Form 1065) based on a “guidance tool” [Government Trial Ex. 20-
3], which “listed the income tax return as something to be requested and reviewed.” [D.E. 214 at 
24].  The government relies on the same underwriting materials to argue that the Bank relied on 
the Form 1065. [D.E. 214 at 14-15]. But as Sheppard has already explained, [D.E. 205 at n.3; 205-
1; 205-2],5 the document shows that the banks would request the K-16 relating to the Form 1065 
only for PPP applications treated by Northeast as partnerships. [Id.] In fact, Northeast treated the 
applicant as a corporation, not a partnership, and the underwriting materials for corporations, used 
by Northeast here, did not list any part of the Form 1065 as a document to be requested or 
reviewed. [Id.] The testimony of Toye that Northeast treated the applicant as a corporation, not a 
partnership, and that no 1065 would be requested or reviewed for applicants treated as corporations 
is unrebutted, supported by the Northeast documents, and ignored in the government’s response.  
Even if Northeast had requested a tax document with Cupersmith’s name on it, there is no 
evidence that the bank relied on it (or on Cupersmith’s name in particular). The government’s 
claim that the “1065 income tax return using the identity of Mr. Cupersmith” was relied upon [by 
Northeast] to support false representations concerning payroll, revenue decline, and business type 
[D.E. 214 at 13] in unsupported and contradicted by the evidence. The government ignores Toye’s 
blanket admission that there was no evidence in the documents that the 1065 was relied upon, 
quoted in the opening brief. [D.E. 205 at 8-9].  There is no contrary evidence. 
As to payroll, as noted above in connection with the underwriting documents, there is no 
evidence the 1065 was relied upon for this purpose. Moreover, Toye admitted that Northeast relied 
on the form 940 (not the 1065), to substantiate average monthly payroll and thus determine 
 
5 [D.E. 205 n. 3]. As shown in the opening brief, the “corporations” tab of the underwriting 
template was completely filled out by the underwriters, says it is the “correct” tab to underwrite 
the loan application, and says the loan was “approved” using the “corporations” tab, not the 
“partnerships” tab; by contrast, the “partnerships” tab of the underwriting  template was not filled 
out by the underwriters, says it is the “wrong” tab, and says the loan was “not approved” using the 
“partnerships” tab. [D.E. 205 at n. 3; D.E. 205-1, D.E. 205-2]. Toye explained that this meant that 
Northeast treated the applicant as a corporation, not a partnership, and that the indication in the 
“partnership” tab to consult the K-1 of the Form 1065 to verify payroll, upon which the 
Government relies, was inapplicable to the approval of this loan. [Id.]. Toye’s testimony is 
unrebutted. 
6 The underwriting document refers to the K-1 of the Form 1065 only. [See Government Trial 
Exhibit 20-3 at “Partnership” tab, line 36]. The K-1 does not have Cupersmith’s identifying 
information.  [See Government Trial Exhibit 20-11 at 14-15]. 
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Sheppard’s eligibility to participate in the PPP program. [12/5/23 AM (Toye) 44:19-21; 47:22-
48:4; 63:11-21]. The form 940 does not contain Cupersmith’s identity.  
There is also no evidence that the Form 1065 was relied on to verify revenue decline. The 
government ignores Toye’s testimony, cited in the opening brief, that the 1065 return was not 
needed or used to substantiate loss of revenue to obtain the loan because the loan amount was 
under $150,000, which meant there was no requirement to substantiate revenue decline. [D.E. 205 
at 9-10]; see also [D.E. 205-2; 205-3].  The Government implicitly admits this, when it argues that 
revenue decline needed to be substantiated only in a later application for forgiveness, never made 
on this loan.  [D.E. 214 at 16]. The Government also ignored the evidence that Northeast could not 
have used the Form 1065 to verify revenue decline, because, as shown in the opening brief and 
ignored by the government, Northeast did not have the previous years’ Form 1065 needed to 
perform such a verification. [D.E. 205 at n.4]. 
Contrary to the Government’s assertion on business type,7 there is also no evidence that 
Northeast relied upon the Form 1065 to verify this. As shown in the opening brief, ignored by the 
government, Toye admitted there was no evidence anyone at the Bank relied upon the 1065 tax 
return for any purpose. [D.E. 205 at 9].  
In sum, the government cites no evidence in support of its contention that the tax forms on 
which Cupersmith’s name appeared was requested or relied on, because there is none. There is 
thus is no evidence that Cupersmith’s identity played any role—not even a “but-for” causal role, 
which was insufficient in Dubin, 599 U.S. at 131—in getting the loan underlying Count Thirteen 
approved. 
Cross River Bank.  A similar evidentiary failure plagues the government’s case with respect 
to Count Fourteen. Spencer Lord admitted: (1) there is no evidence that the underwriter or any 
other person at Cross River read the 1065 return with Cupersmith’s identifying information, and 
(2) that the Cross-River underwriter reviewed and relied on a different tax form (that did not have 
 
7 The Government appears to argue that Northeast must have looked at the business code used in 
the Form 1065 submitted by the applicant to verify that the business code in the application was 
the correct business code for the borrower (on the apparent assumption that tax forms always have 
the correct business code). [D.E. 214 at 16]. But there is no evidence that Northeast performed this 
comparison on this loan. There is no evidence Northeast performed this type of comparison on any 
other PPP loan. There is no evidence that the SBA required PPP lenders to conduct this type of 
industry code verification against a Form 1065. The argument is speculation, unsupported by fact. 
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Cupersmith’s identifying information), to substantiate average monthly payroll and thus PPP 
eligibility: 
Q. 
. . . I asked you isn’t it a fact that there’s no record of anyone reading the 
1065 and you said no I think it would be in the UW analysis do you 
remember that? 
A. 
Yes. 
Q. 
And we’re looking at the UW analysis here, correct? 
A. 
Correct. 
Q. 
And it’s not here? 
A. 
It’s not that – they didn’t list the 1065 out. 
Q. 
Is there anything in the record that [would] verify that a single person at 
cross river actually read the 1065 return? 
A. 
Not that was specifically notated. 
Q. 
Okay.  And again you don’t have personal knowledge, right? 
A. 
Right. 
Q. 
My colleague pointed out something to me that it actually refers to a 
different form here, correct? 
A. 
Correct. 
Q. 
What form does it refer to? 
A. 
The 940. 
Q. 
The 940? 
A. 
Yes. 
Q. 
And that shows that the payroll – the underwriters definitely reviewed the 
940, right? 
A. 
Yes. 
Q. 
And that’s how they verified payroll, right? 
A. 
Yes. 
[12/5/23 PM (Lord) 100:17-111:18]; see Ex. D. 
 
In response, the government observes that: “Cross-River initiated a process to verify the 
tax return by providing defendant an IRS Form 4506-6-T to execute with other closing 
documents.”  [D.E. 214 at 20]. Because the Form 4506-T was to be executed at closing, as admitted 
by the government, the loan was approved and funded before Cross-River could use the Form 
4506-T to obtain materials from the IRS. Accordingly, the Form 4506-T provides no evidence of 
what Cross-River relied upon in approving the loan, and certainly does not rebut Lord’s testimony 
that there is no evidence of Cross-River reviewing the form 1065 in approving the loan. And the 
Government admits there is no evidence that Cross-River acted in any way on the Form 4506-T, 
even after the loan was closed and funded. See [D.E. 214 at 20 (government arguing that “[h]ad 
Cross River turned to the IRS for verification [by submitting the Form 4506-T to the IRS], it would 
have received tax return information . . . .”) [D.E. 214 at 20]. 
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Not only is there no evidence that Cross River Bank reviewed or relied on the Form 1065— 
the evidence actually shows Cross River could not have done so. At the top left corner of the first 
page of the Form 1065 is the NAICS business code number of 636220. [See Government Trial 
Exhibit 22-3 at 1]. Had anyone actually reviewed the Form 1065 or double checked it against the 
PPP application, they would have seen that the code given on the Form 1065 did not match the 
code given on the PPP application. [See Government Trial Exhibit 22-6 at PDF page 3, listing the 
NAICS business code number of 236220 on the PPP application]. They would have also noticed 
that the NAICS number on the Form 1065—636220—is not a number in the NAICS business 
classification list.  For these reasons, a Cross-River underwriter reviewing the Form 1065 would 
have flagged the mismatch with the PPP application and that HM Management submitted a Form 
1065 with an incorrect NAICS number. That no one did is strong evidence that no one reviewed 
the Form 1065 at all or relied on it in approving the loan. 
 
In short, the government offered no evidence that the documents on which Cupersmith’s 
name appeared played any role in getting his businesses’ loan applications approved, and the 
government is wrong when it says that Cupersmith’s identity lent credibility to the fraud. The 
Government chose to call only hearsay witnesses with no personal knowledge who could testify 
only about what the documents showed, and those documents did not show any reliance on Forms 
1065.  Unlike it Dubin, the Forms 1965 were not even “a but-for cause of its success.” 599 U.S. at 
131 (quotations omitted).   
 
2.  Cupersmith’s identity was of no significance. Even if the government is correct that 
someone at the banks had relied on the Form 1065’s themselves, there is no evidence that 
Cupersmith’s identity was “at the crux” of either banks’ approval of the PPP loan applications, as 
demonstrated in the opening brief. [D.E. 205 at 12-13]. There is no evidence that anyone read or 
took note of whether a CPA’s information was on the forms, much less that it played a causal role 
in the loan approval. Indeed, the 1065 tax forms on which Cupersmith’s name appeared did not 
even require that a CPA be identified. [Id.]. For this additional reason, any misrepresentation about 
Cupersmith’s identity most decidedly was not a mover, let alone a “key mover,” Dubin, 599 U.S. 
at 123, in Sheppard’s alleged scheme to convince the banks to approve his loan applications. This, 
too, requires an acquittal. The government offers nothing in response. 
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C. 
The Evidence Was Otherwise Insufficient 
In the motion, the defense argued that government provided no evidence of who forged 
Cupersmith’s signature or who submitted the forged returns. [D.E. 205 at 13]. Specifically, there 
is no evidence that Sheppard forged Cupersmith’s name or knew that others did. The government 
spent substantial time putting on evidence regarding IP addresses, but never in connection with 
the submission of the forged returns.8 In the absence of evidence, the government asked the jury 
to speculate that Sheppard was to blame for the forgeries. The government does not address this 
argument in its response brief, presumably because it has no explanation for the lack of evidence. 
II. 
THE GOVERNMENT DID NOT PROVE A SCHEME TO DEFRAUD 
A. 
The Government Did Not Prove A “Scheme To Defraud” 
The Court should also enter a judgment of acquittal on the wire fraud counts. The 
government did not prove that Sheppard engaged in a “scheme to defraud” the Small Business 
Administration (“SBA”).9 And the government did not prove that Sheppard engaged in a “scheme 
to defraud” the banks because they got exactly what they “bargained for.” United States v. 
Takhalov, 827 F.3d 1307, 1312 (11 Cir. 2016). The only harm here is regulatory—the federal 
government had a policy interest in ensuring that PPP loans were made only to certain businesses 
with W-2 employees [see Dkt. 214 at 7]—but regulatory harm cannot, as a matter of law, ground 
a conviction for wire fraud.  [D.E. 205 at 2, 16]. 
The SBA. The government suggests that the SBA lost two property interests: (i) money 
(i.e., “U.S. Treasury dollars”); and (ii) guarantees the government made “to lenders” (i.e., the 
banks). [See D.E. 214 at 6-7]. Neither suffices to sustain Sheppard’s conviction. 
 
Sheppard did not obtain the SBA’s money. The government did not establish that the SBA 
(as opposed to the “U.S. Treasury,” [id.]) had a property interest in the money on the government 
side of the PPP program. [D.E. 205 at 16-17]. Sheppard also did not “obtain,” 18 U.S.C. § 1343, 
any government money, even if (by hypothesis) PPP loan money was SBA property. To commit 
fraud, there must be “an actual” or at least “potential transfer of property from the victim to the 
 
8 For example, Northeast does not know who submitted the forged 1065 or from which IP address 
it came. [12/5/23 AM (Toye) 18:12-19:4, 49:4-11]. 
9 Sheppard was convicted only of counts involving the PPP program. There was no wire fraud 
charge for the loan for which he received forgiveness.  Sheppard was acquitted of all charges 
related to the EIDL program. Moreover, it is undisputed that Sheppard has been paying back the 
PPP loans according to their terms. 
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defendant.” United States v. Walters, 997 F.2d 1219, 1224 (7th Cir. 1993). That “is essential.” Id. 
In Sekhar v. United States, 570 U.S. 729 (2013), for instance, the Court held under the similarly-
worded Hobbs Act, 18 U.S.C. § 1951, that obtaining property requires not only that “the victim 
part with his property,” but that the defendant “gain possession of it.” Id. at 734 (quotations 
omitted)). Likewise, in Skilling v. United States, 561 U.S. 358 (2010), the Court contrasted honest 
services fraud with traditional “money or property” fraud by noting that money or property frauds 
involve situations in which “the victim’s loss of money or property supplied the defendant’s gain, 
with one the mirror image of the other.” Id. at 400; see also, e.g., Kelly v. United States, 140 S. Ct. 
1565, 1573 (2020) (no property fraud where defendants “did not walk away with the lanes; nor did 
they take the lanes from the Government by converting them to a non-public use”); Walters, 997 
F.3d at 1225-26 (drawing from Supreme Court case law under 18 U.S.C. § 371). Here, Sheppard 
did not “obtain” any federal government dollars. He received money from the banks—and only 
the banks. There was no “actual” or “potential transfer of” money from the government to 
Sheppard. Walters, 997 F.2d at 1224. And “only a scheme to obtain money or other property from 
the victim by fraud violates § 1341.” Id. at 1227 (emphasis added). 
The government’s “loan guarantee” theory of property fraud fails for the same and 
additional reasons. The government suggests that the object of Sheppard’s fraud were guarantees 
of loan money made by the federal government. [See D.E. 214 at 7]. But as the government admits, 
those guarantees were made to the banks. [Id. (government “provide[d] payment guarantees to 
lenders”).10 Sheppard did not “obtain” the government’s guarantees, and thus could not have 
committed wire fraud with federal loan guarantees as the property interest. 
There are other major flaws in the government’s assertion that an SBA loan guarantee was 
the object of the fraud. To start, this theory was not alleged in the indictment. In addition, it was 
not argued to the jury, and this Court “cannot affirm a criminal conviction on the basis of a theory 
not presented to the jury.” Chiarella v. United States, 445 U.S. 222, 236 (1980); see also, e.g., 
McCormick v. United States, 500 U.S. 257, 270 & n.8 (1991). And the guarantee made by the 
government to the lending banks was at most “an incidental byproduct of the scheme,” Kelly v. 
 
10 See also [11/27/23 T. (Harris) 213:17-22] (“Q. And how would the lending be made whole if 
the borrower could simply not pay it back? A. Well, that’s what SBA’s in the marketplace to do, 
to provide the guarantee to the lender. So in all cases, the SBA endeavors to make the lender whole 
in the event that a borrower doesn’t repay a loan.”) 
Case 1:22-cr-20290-BB   Document 218   Entered on FLSD Docket 03/11/2024   Page 11 of 16

12 
 
United States, 140 S. Ct. 1565, 1573 (2020), not the object of the alleged fraud, which were PPP 
loan proceeds. See id. at 1573-74 (holding that a fraud conviction cannot be sustained where harm 
to property is only an “incidental (even if foreseen) byproduct” of the fraud, not “[t]he object of 
the scheme”). 
  The government relies heavily on United States v. Griffin, 76 F.4th 724 (7th Cir. 2023), 
but Griffin offers the government no support. In Griffin, the defendants were agents for the lenders.  
Id. at 734-35 (defendants worked at or with a company that “represent[ed] the lender before the 
SBA”). The object of their scheme was to “obtain” directly from the government “SBA guarantees 
for loans that did not meet the SBA’s guidelines and requirements.” Id. at 734. But none of that is 
true here. Sheppard did not work for the banks, like the defendants in Griffin. And the object of 
his alleged scheme was not to obtain loan guarantees from the SBA. Griffin’s holding about the 
relationship between a lender’s agents and the SBA says nothing about the relationship between a 
borrower and the SBA.11 
The Banks. Sheppard’s conviction cannot be upheld on a banks-as-victim theory because 
Sheppard’s scheme could not have caused the banks harm: They got exactly what they “bargained 
for.” Takhalov, 827 F.3d at 1312-13. The banks made a loan, guaranteed by the government, on 
which they had no financial exposure. [See 11.27.23 AM Trial Tr. 214:2-13]. And Sheppard’s 
alleged misrepresentations about PPP eligibility were not material to the banks’ financial risk in 
extending the loans because the eligibility criteria were dictated solely by the government’s policy 
interests. [D.E. 205 at 2, 16-18]. The government likewise produced no evidence that Sheppard 
intended to harm the banks by failing to repay the loans or otherwise “deprive” them of their 
property.  See United States v. Sadler, 750 F.3d 585, 590 (6th Cir. 2014) (defendant did not possess 
a “purpose … to injure” drug distributors when she paid full price for their drugs).  Any 
“unflattering motives” Sheppard may have possessed in applying for the loans did not include an 
intent to “unfairly depriv[e] the [banks] of their property.”  Id.   
 
11 The government is also wrong about convergence. The government was required to prove 
Sheppard’s intent “to obtain money or property from the one who is deceived.”  United States v. 
Bailey, 123 F.3d 1381, 1390 n.12 (11th Cir. 1997) (quotations omitted). The government offered 
no evidence that Sheppard intended to deceive the government for the purpose of obtaining its 
property. Its evidence shows only that Sheppard knew the government was involved in some 
general sense in the PPP program, [see D.E. 214 at 8 n.2], not that Sheppard knowingly intended 
to deceive the government to obtain its property. 
Case 1:22-cr-20290-BB   Document 218   Entered on FLSD Docket 03/11/2024   Page 12 of 16

13 
 
The government does not dispute that the banks got exactly what they bargained for.  
Instead, it suggests that they were “harmed” because they lost the time value of money on the 
funds they disbursed to Sheppard, who is paying back the loans at a 1% interest rate. [D.E. 214 at 
9]. This new argument fails. First, there was no evidence of this alleged loss, and it was never 
argued to the jury that the interest rate caused the banks harm. Second, if the banks lost money by 
deploying assets in the PPP program versus other lending opportunities, that is because of the 
bank’s investment strategy, not because of the Sheppard’s alleged fraud. At the government’s 
insistence, the defense was prohibited from inquiring into the banks’ investment strategy. This is 
one of the reasons there was no evidence why the bank chose to participate in the PPP program, 
and whether they would have done better in private lending. Yet now the government seeks to 
preserve the wire fraud convictions on these non-record grounds. The suggestion is that the 
government would have earned more than 1% had it not loaned the funds to Sheppard’s businesses 
but it offered no evidence on that score. It offered no evidence that the banks could have earned 
more had they retained possession of the loan money or that Sheppard’s businesses would have 
taken out loans at higher rates had the banks known that they were not eligible to participate in 
PPP. Just the opposite: The only evidence on this question was that the banks sought out PPP loans 
and benefitted financially because they earned processing fees. [12/28/23 AM (Harris) 83:9-11].12 
B. 
The Evidence Of Fraud Was Otherwise Insufficient 
The defense discussed several ways the evidence of wire fraud was insufficient in the 
motion. [D.E. 205]. The government makes blanket statements in opposition without meaningfully 
addressing these arguments. [D.E. 214 at 9-10]. Here, the government asserts, “the evidence was 
substantial” that Sheppard  was responsible for the conduct giving rise to the wire fraud counts. 
 
12 The government also suggests that it need not prove harm because the wire fraud punishes the 
scheme to defraud. [D.E. 214 at 9]. But it does not follow that in prohibiting a scheme to defraud, 
Congress criminalized a scheme that would not amount to fraud because it caused no injury—in 
creating an inchoate crime, Congress did not fundamentally alter fraud’s elements. And as the 
Eleventh Circuit has explained, “to defraud, one must intend to use deception to cause some 
injury.” Takhalov, 827 F.3d at 1312. Here, there is no evidence that Sheppard intended to—or 
did—cause the banks injury because they stood only to gain from making PPP loans, even where 
non-pecuniary eligibility criteria were not satisfied. United States v. Mansouri, 2023 8430239 
(W.D.N.Y. Dec. 5, 2023), decided on an indictment, did not squarely confront whether a wire 
fraud conviction can be sustained where the evidence shows that the supposed victim benefited 
from the alleged fraud. The argument there was that the banks were not harmed because the loans 
were guaranteed by the SBA. Id. at *2. 
Case 1:22-cr-20290-BB   Document 218   Entered on FLSD Docket 03/11/2024   Page 13 of 16

14 
 
But the “substantial evidence” the government goes on to discuss is far from sufficient to sustain 
a conviction. 
First, the government claims Sheppard was the sole signer on accounts used by the 
companies, and he controlled the funds in those accounts. But that does not mean Sheppard 
submitted fraudulent applications or documents for PPP. The evidence was that the bank account 
information necessary for the PPP applications was known and used by numerous workers, 
including Jeff Vasilas and Jeanette Gonzalez, among others.  [See, e.g., 12/19/23 PM (E. Sheppard) 
22:5-13]. The evidence also showed that Sheppard was not always in control of the funds in his 
accounts, as he tasked Ms. Gonzalez with that responsibility, Mr. Vasilas kept and used Sheppard’s 
American Express card in Orlando, and Sheppard had employees in the past who stole from the 
company without his knowledge. [See, e.g., 12/19/23 AM (E. Sheppard) at 55:3-57:1]. Second, 
the government claims Sheppard’s contact information was all over the PPP application. Again, 
that does not mean Sheppard is responsible for the fraudulent transmissions. The evidence was 
Sheppard’s contact information was widely known to other workers in the company, including 
those who were assisting Sheppard with PPP applications. For example, copies of Sheppard’s 
driver’s license were available for use by workers. [See, e.g., 01/19/24 PM (E. Sheppard) at 41]. 
Third, the government claims that Sheppard’s email and home IP address were used for the PPP 
loan applications. The evidence was that Sheppard’s home was the office for many workers after 
COVID. [See, e.g., 12/06/23 AM (Del Pilar Ataca) at 36]. And many people had access to 
Sheppard’s email addresses, including Mr. Vasilas and Ms. Gonzalez. [See, e.g., 01/08/24 AM (E. 
Sheppard) at 39:12-20].13 
The jury agreed the above evidence was not substantial. The jury acquitted Sheppard of 
several wire fraud accounts for applications submitted from Sheppard’s home, using Sheppard’s 
email, and containing Sheppard’s contact information and bank information. Indeed, Sheppard 
was acquitted of most of the charges against him. He was found guilty of only 6 out of 14 charges.  
 
13 The government understates the importance of the gate proposal signed by Mr. Vasilas for 
Sheppard’s home. [D.E. 214 at n.3]. The gate proposal was DocuSigned by Vasilas from the office 
at Sheppard’s home, as evidenced by the IP address. This proves Vasilas used the office, signed 
documents from the office using the internet there, and had access to the office and internet while 
Sheppard was not present.  
Case 1:22-cr-20290-BB   Document 218   Entered on FLSD Docket 03/11/2024   Page 14 of 16

15 
 
Barely two hours into deliberations, the jury informed the Court that it was deadlocked on most of 
the counts.14 
The government ignores the defense’s other arguments on the insufficiency of the 
evidence. 
CONCLUSION 
 
For the foregoing reasons, Defendant Eric Dean Sheppard respectfully requests that the 
Court enter judgment of acquittal on all counts of conviction. 
Dated: March 11, 2024. 
 
 
 
Respectfully submitted, 
NELSON MULLINS  
One Biscayne Tower, 21st Floor  
2 S. Biscayne Boulevard  
Miami, FL 33131  
Telephone: 305.373.9400 
 
By: /s/ Christopher Cavallo 
Christopher Cavallo  
Florida Bar No. 0092305 
Jayne C. Weintraub 
Florida Bar No. 320382 
Jonathan Etra  
Florida Bar No. 686905 
BLACK SREBNICK  
201 South Biscayne Boulevard, Suite 1300  
Miami, Florida 33131  
Tel. (305) 371-6421  
By: /s/ Howard Srebnick   
HOWARD SREBNICK  
Florida Bar No. 919063 
O’MELVENY & MYERS 
Jeffrey L. Fisher (admitted pro hac vice) 
2765 Sand Hill Road 
Menlo Park, CA 94025 
(650) 473-2600 
Jason Zarrow (*pro hac vice forthcoming) 
400 S. Hope Street 
Los Angeles, CA 90071 
(213) 430-8367
 
 
14 The government also makes a strawman argument to get around its failure to sustain its burden 
of proof that the workers were truly independent contractors and not bona fide employees. As 
pointed out in the opening brief, and ignored by the government, the Government’s IRS expert 
witness testified to the difficulty in properly classifying workers one way or the other and was 
never asked to opine that the workers were independent contractors. On this record, the 
classification made by the applicant does not provide the jury with evidence beyond a reasonable 
doubt on their proper status. The government also did not prove Sheppard’s intent to defraud on 
this issue or with respect to the allegedly false business code or ineligible industry. 
Case 1:22-cr-20290-BB   Document 218   Entered on FLSD Docket 03/11/2024   Page 15 of 16

16 
 
CERTIFICATE OF SERVICE 
 
I HEREBY CERTIFY that on March 11, 2024, the foregoing document was filed via the 
Court’s CM/ECF system to all counsel of record.  
By: /s/ Christopher Cavallo 
Christopher Cavallo 
Case 1:22-cr-20290-BB   Document 218   Entered on FLSD Docket 03/11/2024   Page 16 of 16

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