Corrected Reply to Response to Motion by Eric Dean Sheppard — USA v. Sheppard (Dkt. 280, S.D. Fla.)

Record facts

U.S. District Court for the Southern District of Florida · No. 1:22-cr-20290-BB · Doc. 280 · 2024-07-12 · Docket on CourtListener

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UNITED STATES DISTRICT COURT 
SOUTHERN DISTRICT OF FLORIDA 
 
CASE No. 22-20290-CR-BLOOM 
 
UNITED STATES OF AMERICA, 
 
 
vs. 
 
 
 
 
 
 
 
ERIC DEAN SHEPPARD, 
 
 
 
 
 
 
 
 
 
 
 
Defendant. 
_______________________________/ 
 
DEFENDANT ERIC DEAN SHEPPARD’S CORRECTED REPLY IN 
SUPPORT OF RENEWED MOTION FOR BOND PENDING APPEAL1   
 
Defendant Eric Dean Sheppard should not be required to spend months in 
prison while the Supreme Court considers whether the theory underlying his 
convictions is valid.  Sheppard was convicted on a fraudulent inducement theory.  
Kousisis v. United States, No. 23-909, __ S. Ct. __, 2024 WL 3014475 (U.S. June 
17, 2024), will decide if that is a valid theory of wire fraud.2  The government’s 
assertion that Kousisis will not affect Sheppard’s convictions because that case 
involves government contracting and this case involves loans is nonsense.  The very 
 
1 This filing corrects the filing earlier today in order to properly title the document a 
“reply” and to correct typographical errors. 
 
2 Undersigned counsel, Jeff Fisher and Jason Zarrow, of O’Melveny & Myers, were 
recently retained to represent petitioners in Kousisis.  We have not yet made our 
appearances on the docket. 
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first question presented in Kousisis—which the government omits from its 
opposition—squarely tees up “the validity of the fraudulent inducement theory of 
mail and wire fraud.”  Pet. for Cert., Kousisis v. United States, U.S. No. 23-909, 2024 
WL 750795, at *i.  That is the same legal theory grounding Sheppard’s convictions. 
Meanwhile, the government’s assertion that this Court did not commit 
sentencing error is based on a misrepresentation of the record.  The government 
insists that the Court calculated “actual loss,” not “intended loss.”  But the Court 
could not have been clearer that its “ruling [was] with regard to intended loss.”  
[6/7/24 Tr. 46-47.]  Because this Court calculated intended loss incorrectly (at the 
government’s urging), the Eleventh Circuit is likely to reverse.  But Sheppard will 
not be able to secure effective relief on appeal unless he is granted bond because his 
appeal is likely to last longer than his sentence. 
This Court should grant Sheppard bond pending appeal.   
ARGUMENT 
A. 
Sheppard’s Convictions Present A Substantial Question 
1.  The government asserts that the Supreme Court’s decision in Kousisis will 
not affect Sheppard’s convictions because “[t]he petition for certiorari” in Kousisis 
“posed several questions centered around government contracts” [D.E. 277 at 2], 
which, the government apparently believes, have no broader application.  The 
government is demonstrably incorrect. 
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The government ignores the first question presented in Kousisis—and the 
remainder of the petition.  As the preface to the questions presented make clear, the 
Supreme Court took the case to resolve a circuit split “on the validity of the 
fraudulent inducement theory of mail and wire fraud.”  Kousisis Pet., 2024 WL 
750795, at *i.  Thus, the very first question asks “[w]hether deception to induce a 
commercial exchange can constitute mail or wire fraud, even if inflicting economic 
harm on the alleged victim is not the object of the scheme.”  Id.  And the rest of the 
petition identifies a circuit split about the fraudulent inducement theory, argues that 
the theory is wrong, and explains that the theory has grave implications.  The reply 
in support of cert is to the same effect.  See, e.g., Cert. Reply, Kousisis v. United 
States, U.S. No. 23-909, 2024 WL 2190742, at *2 (“The validity of the fraudulent-
inducement theory is an open question on which this Court’s guidance is essential.” 
(bolding and capitalization omitted)).  Nothing about the fraudulent inducement 
theory is limited to cases involving government contracting (as opposed to private 
contracting, like a loan from a bank), nor is there anything unique about the 
government contracting context that would suggest the Supreme Court’s decision 
next Term will be so limited.  Certainly, the government identifies no such hidden 
distinction.   
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As the petition makes perfectly clear, Kousisis will decide whether deception 
without harm—i.e., fraudulent inducement—is a valid theory of wire fraud.  The 
government does not dispute that Sheppard was convicted on such a theory.  
Sheppard should not languish in prison while the Supreme Court considers whether 
the theory supporting his convictions is valid. 
2.  The government offers no response to Sheppard’s argument that this 
Court’s reliance on United States v. Watkins, 42 F.4th 1278 (11th Cir. 2022), to 
sustain his convictions raises a substantial question.  [See D.E. 273 at 6-9.]  As 
Sheppard explained, Watkins was a commercial loan case where misrepresentations 
about the borrower’s identity self-evidently affect the parties’ “bargain.”  42 F.4th at 
1286-87.  This is not a commercial loan case.  And there was no bargain to be had 
because all the terms of a PPP loan were set by federal regulation.  The government 
has never even attempted to explain why Watkins’s holding about the types of 
representations that go to the nature of a commercial bargain would apply in this 
context where commercial bargaining was legally impossible.  
B. 
The Court Should Also Grant Bond Based On Sentencing Error 
The Court should also grant bond because it erred in calculating intended loss 
under the Guidelines by ignoring Sheppard’s subjective intent to repay the loans.  
[D.E. 273 at 9-15.]  The government invited this error when it led the Court astray 
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by relying on a legal standard regarding intended loss that has been expressly 
repudiated.  [See D.E. 273 at 13-14.]   
Instead of confessing error, the government misrepresents that “[t]he Court 
determined the loss amount at sentencing based on the actual loss amount, not the 
intended loss.”  [D.E. 277 at 2.]  No, it didn’t.  Here is the Court’s holding reproduced 
in full: 
As we know, the loss amount under 2B1.1 is the greater of the actual or 
intended loss. And with regard to the intended loss, let me make a 
comment that I am somewhat concerned that the Court should be 
considering acquitted conduct.  But I agree that uncharged conduct that 
is relevant conduct is important for the Court to consider.  And based 
on what has been presented to the Court, understanding that Mr. 
Sheppard has been found guilty by the jury of Counts 5, 7, 8, and 9 it 
would appear to the Court that the loans based on the Government’s 
Exhibit 72 as well as what has been presented to the Court this morning 
would appear to include as the intended loss the loan of 146,587. The 
loan of 148,397, and the loan of 148,591.   
 
And that is the Court’s ruling with regard to the intended loss. 
The Government does bear the burden by a preponderance of the 
evidence and the objection is sustained in part and that is the amount of 
the loss or the intended loss that the Court is calculating.  So the 
probation can advise of the amount and I believe the advisory guideline 
calculation should change as a result of that. 
[6/7/24 Tr. 46-47 (emphasis added); see id. at 47 (asking Probation to “give me the 
amount of the intended loss … and where that falls” under the Guidelines).    
The government’s inability to offer any defense of its position or the Court’s 
intended loss calculation confirms that the Eleventh Circuit is likely to reverse (if 
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the government does not confess error before then).  But it is imperative that 
Sheppard be granted bond in the meantime.  If he is not, his ability to obtain effective 
relief from the Court of Appeals will be destroyed since his appeal will almost 
certainly last longer than his sentence. 
CONCLUSION 
 
This Court should grant Sheppard bond pending appeal.  
 
Respectfully submitted,  
 
 
 
 
 
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) 
 
 
 
 
 
Jason Zarrow (admitted pro hac vice) 
 
 
 
 
 
 
 
 
 
 
 
NELSON MULLINS 
Jayne C. Weintraub 
  Florida Bar No. 320382 
Jonathan Etra  
  Florida Bar No. 686905 
Christopher Cavallo  
  Florida Bar No. 0092305 
 
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