Sentencing Memorandum by Eric Dean Sheppard — USA v. Sheppard (Dkt. 290, S.D. Fla.)

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U.S. District Court for the Southern District of Florida · No. 1:22-cr-20290-BB · Doc. 290 · 2024-08-21 · 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 
 
v. 
 
ERIC DEAN SHEPPARD 
______________________________/ 
 
 
SHEPPARD’S MEMORANDUM REGARDING RESTITUTION 
 
 
The government’s restitution arguments, see ECF#258, are founded not on 
the theory that the offenses of conviction caused economic loss. Instead, the 
government seeks restitution for (1) a dismissed offense, i.e., Count 1 of the 
original indictment alleging fraud regarding a 4/15/2020 PPP loan application, 
ECF#3 at 6, that was abandoned in the superseding indictment, ECF#189 at 7, and 
that the jury’s verdict confirms was not part of the substantive offenses of 
conviction or even the alleged criminal scheme, given acquittals as to all conduct 
prior to 2021, ECF#190, and (2) extraordinary expenditures (legal fees) allegedly 
incurred by a witness (Cupersmith) subpoenaed by the government, who is not a 
victim under any count of conviction.  
 
The statutory limits of restitution would be unwarrantedly extended by the 
government’s request. The witness’s claim of entitlement to attorney fees would 
constitute witness remuneration well beyond the scope of the Mandatory Victim 
Restitution Act (MVRA), 18 U.S.C. § 3663A. The Court should deny the 
restitution requests.   
 
As relevant here, the MVRA addresses only victims proximately harmed by 
of specified Title 18 offenses of conviction and scheme elements proven applicable 
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to the conduct. United States v. Brown, 665 F.2d 1239, 1252 (11th Cir. 2011); 
United States v. Dickerson, 370 F.3d 1330, 1341 (11th Cir. 2004)).  Restitution 
awards “must be based on the amount of loss actually caused by the defendant’s 
conduct,” and “[t]he government bears the burden of proving the amount of the 
loss.” United States v. Huff, 609 F.3d 1240, 1247 (11th Cir. 2010) (internal citation 
omitted; emphasis in original). The government must prove both proximate and but 
for causation of actual loss. Id.; 18 U.S.C. § 3663A(a)(2).  “Restitution is not to 
provide a windfall for crime victims.” United States v. Martin, 803 F.3d 581, 594 
(11th Cir. 2015) (citations and internal quotation marks omitted). 
The 2020 PPP Loan
 
The jury acquitted Sheppard of all loan applications submitted before 2021.  
These acquittals show that the jury found that the criminal scheme did not stretch 
back to 2020.  Yet the government seeks restitution for a PPP loan issued in April 
2020.  That loan was not part of the criminal scheme found by the jury, so the 
government cannot seek restitution and forfeiture for the loan—the government 
cannot recover for conduct that has not been found to be criminal. 
 
The Eleventh Circuit “has cautioned that ‘the amount of loss for restitution 
purposes will not always equal the amount of loss under the sentencing guidelines’ 
and courts must be careful to narrowly tailor restitution.’”  United States v. 
Kreitman, 773 F. App’x 1073, 1077 (11th Cir. 2019) (quoting United States v. 
Bane, 720 F.3d 818, 827 (11th Cir. 2013)); see United States v. Hesser, 800 F.3d 
1310, 1332 (11th Cir. 2015) (reversing restitution order as to tax fraud convictions 
where sentencing court went beyond offense of conviction; holding that “a district 
court is only authorized to order restitution in the amount of the actual losses the 
defendant causes in committing [an] offense”) (citing United States v. Nolen, 472 
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F.3d 362, 382 (5th Cir.2006); United States v. Campbell, 106 F.3d 64, 69–70 (5th 
Cir. 1997)) (emphasis added).  “Without an anchor to the offense of conviction, the 
government is left only with distinct, unrelated conduct for which separate charges 
should have been brought.” United States v. Amedeo, 370 F.3d 1305, 1322 (11th 
Cir. 2004).  After all, "[a] federal district court has no inherent authority to order 
restitution, and may do so only as explicitly empowered by statute." United States 
v. Valladares, 544 F.3d 1257, 1269 (11th Cir. 2008) (quoting United States v. 
Dickerson, 370 F.3d 1330, 1335 (11th Cir. 2004)).  
Cupermith’s Legal Fees 
 
For two overarching reasons, the government is not entitled to recover 
$220,000 in legal fees incurred by Neal Cupersmith.  First, Cupersmith is not a 
victim of any offense of conviction, as that term is used in the MVRA.  This Court 
acquitted Sheppard of criminal conduct relating to his alleged forgery of 
Cupersmith’s name, concluding that the use of Cupersmith’s name bore an 
insufficient nexus to the wire fraud.  To be sure, Cupersmith’s testimony was 
germane to the now-dismissed aggravated identity counts, but the government 
cannot obtain restitution on a claim it lost.  Second, Cupersmith’s high legal fees, 
even if recoverable, are unjustified and unsupported.
 
The government seeks restitution for legal fees of more than $220,000 
incurred by Neal Cupersmith as a subpoenaed witness. The claim for attorney’s 
fees is set forth in billing statements with notable billing rates of $950 and $825 
per hour, for services that are not explained.   
 
The MVRA does not apply to witnesses who choose to spend nearly a 
quarter of a million dollars to pursue what amounts to a private prosecutor role or 
to otherwise oppose the defendant's trial defenses, particularly when the witness 
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suffered no economic loss from the charged offenses. Neither the statute nor the 
case law the government cites supports the request.   
 
To be a victim under the MVRA, the claimant must have suffered a harm 
that “‘directly and proximately’” results from the commission of the defendant’s 
offense. United States v. Bane, 720 F.3d 818, 827 (11th Cir. 2013) (quoting 18 
U.S.C. § 3663A(a)(2).); accord United States v. Washington, 434 F.2d 1265, 1268 
(11th Cir. 2006)).  To meet this standard, the government “must show not only that 
a particular loss would not have occurred but for the conduct underlying the 
offense of conviction, but also that the causal connection between the conduct and 
the loss is not too attenuated (either factually or temporally).” United States v. 
Cutter, 313 F.3d 1, 7 (1st Cir. 2002).  See United States v. Robertson, 493 F.3d 
1322, 1334 (11th Cir. 2007) (holding district court erred in concluding a victim 
was eligible for restitution under the MVRA where defendant’s fraud did not 
proximately cause the victim’s loss); Robers v. United States, 572 U.S. 639, 645 
(2014) (Section 3663A(a)(2) has a proximate cause requirement involving a 
proximately close connection between the conduct of conviction and the claimed 
loss).
 
Even as to victims who directly suffer pecuniary harm from the commission 
of an offense, the MVRA limits recoverable expenses to “lost income and 
necessary child care, transportation, and other expenses.” 18 U.S.C. § 3663A(b)(4) 
(emphasis added).  Under the Restitution Act, 18 U.S.C. § 3664(e) “[t]he burden of 
demonstrating the amount of the loss sustained by a victim as a result of the 
offense shall be on the attorney for the Government.” 18 U.S.C. § 3664(e). “[T]he 
government bears the burden of supporting its loss calculation with ‘reliable and 
specific evidence.’” United States v. Cabrera, 172 F.3d 1287, 1292 (11th Cir. 
1999). Speculation is barred. Critically, a “victim’s unsupported loss estimate [is] 
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insufficient, on its own, to substantiate a restitution amount.” United States v. 
Steele, 897 F.3d 606, 613 (4th Cir. 2018) (citing United States v. Mullins, 971 F.2d 
1138, 1147 (4th Cir. 1992)). “[E]xcessive restitution awards cannot be excused by 
harmless error; every dollar must be supported by record evidence.’” United States 
v. Kim, 988 F.3d 803, 811 (5th Cir. 2021) (quoting United States v. Sharma, 703 
F.3d 803, 823 (5th Cir. 2012)).  The government has not justified recovery for the 
attorney time or the rates billed by Cupersmith’s attorneys. 
 
Cupersmith cannot claim to be a victim of the offenses of conviction (wire 
fraud).  He did not make a loan to the defendant; instead, he admitted he was paid 
for any services he provided to the defendant.  Most importantly, the defendant 
was acquitted of the charge of aggravated identity theft, and that charge did not 
involve pecuniary harm to Cupersmith, in any event.   
 
The government frequently subpoenas witnesses to testify and produce 
documents for trial, but their status as a subpoenaed witness does not render them 
MVRA victims. Governing case law as to witnesses in federal criminal cases 
shows that Cupersmith does not qualify as an MVRA victim warranting restitution.  
 
In the cases cited by the government, persons not directly injured by the 
defendant’s offense conduct nonetheless qualified as victims because they were 
actually subrogated to the victims and became the ultimate financial victims of the 
offense, such as a successor lender or other purchaser/investor directly harmed by a 
fraud.  See United States v. Martin, 803 F.3d 581, 593 (11th Cir. 2015) (successor 
lenders who had purchased fraudulently procured mortgages from the lenders who 
were defrauded); In re Stewart, 552 F.3d 1285, 1289 (11th Cir. 2008) (home 
buyers defrauded into paying higher mortgage fees). Cupersmith in no way fits the 
category of a subrogated or other direct financial victim of the offense of 
conviction as in the cases cited by the government. 
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To the extent the government claims that the offenses of conviction were the 
proximate cause of an MVRA compensable loss to Cupersmith for attorney fees, 
the restitution claims and the facts offered by the government do not support 
imposing such additional financial penalties in this case.  See United States v. 
Medina, 485 F.3d 1291, 1304 (11th Cir. 2007).  
 
WHEREFORE, Defendant Eric Dean Sheppard requests that the Court 
sustain his objections to the government’s restitution claims after hearing any 
relevant evidence at a hearing, including as to claims made by Cupersmith. 
 
 
 
 
 
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  
  Email: HSrebnick@RoyBlack.com 
 
 
 
 
 
 
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  
Case 1:22-cr-20290-BB   Document 290   Entered on FLSD Docket 08/21/2024   Page 6 of 6

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