Court filing
Motion to Dismiss Count Nine for Lack of Venue as to Kisha Sutton — United States v. Sutton et al. (Dkt. 192, S.D. W. Va.)
Summary
Kisha Sutton's motion to dismiss Count Nine of the superseding indictment for lack of venue in United States v. Sutton, Case No. 2:24-cr-00192, U.S. District Court for the Southern District of West Virginia, filed 05/08/25 as Document 192. The count is for bank fraud and alleges she caused a PPP loan application and a Schedule C to be submitted for Lydia Spencer, funded for $15,625, and that Spencer remitted $3,000 of the proceeds to her from the Southern District of West Virginia. The motion says the application was received by a third-party vendor website called Womply, which it says is not a bank or a financial institution and had no servers in that district, and that the lender was Fountainhead SBF LLC of Lake Mary, Florida. Through counsel Connor Robertson, she argues no essential conduct occurred in the district.
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Filed May 8, 2025 in United States v. Sutton et al.; one of 235 filings from this case.
Record facts
| Court | U.S. District Court for the Southern District of West Virginia |
|---|---|
| Filed | 2025-05-08 |
Cite this document
“Motion to Dismiss Count Nine for Lack of Venue as to Kisha Sutton — United States v. Sutton et al. (Dkt. 192, S.D. W. Va.).”
U.S. District Court for the Southern District of West Virginia, No. 2:24-cr-00192, Doc. 192, filed 2025-05-08. Archived at Pandemic Darlings, https://pandemicdarlings.com/court-filings/full-docket-kisha-sutton-wvsd-240497/2025-05-08-gov-uscourts-wvsd-240497-192-0-doc-192/
, SHA-256 a2f78133def5a3242ec5a6f26478d15190d9f38492e45b05cc9d556d1eac8ac2.Full text
IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF WEST VIRGINIA CHARLESTON UNITED STATES OF AMERICA, PLAINTIFF, V. CASE NO.: 2:24-cr-00192 KISHA SUTTON, DEFENDANT. DEFENDANT’S MOTION TO DISMISS COUNT NINE FOR LACK OF VENUE Now comes the Defendant, Kisha Sutton, by and through counsel, Connor Robertson, and respectfully moves this Honorable Court to Dismiss Count Nine of the Defendant’s Superseding Indictment, charging the Defendant with “Bank Fraud” in violationofTitle18U.S.C.§1344(1)and(2),astheGovernmentcannotestablishVenuein the Southern District of West Virginia. In support thereof, the Defendant states as follows: Count Nine This is a fraudulent scheme prosecution with a very simple theory: Kisha Sutton prepared and submitted PPP Loan applications containing false information of her acquaintances in order to receive money from a bank or otherentitieswhichqualifyas financial institutions under federal law. In Count NineoftheSupersedingIndictmentthe GovernmenthasallegedthatMs.Sutton,onApril8,2021,“causedthesubmissionofaPPP loanapplicationandaScheduleCtoFinancialInstitution3onbehalfofLydiaSpencer.”See Sup. Indictment, para. 81. The application falsely stated that Ms. Spencer was a sole Case 2:24-cr-00192 Document 192 Filed 05/08/25 Page 1 of 9 PageID #: 1039 proprietor,thathisbusinesswasestablishedpriortoJanuaryof2016,andhadanincome ofmorethan$75,000.00whichmadeherfictitiouslyeligibleforPPPloanreliefduringthe Covid pandemic. Id. at para 82. Based on the false information provided, Financial Institution2fundedtheloantoMr.Powellfor$15,625onoraboutApril30,2021.Id.at. Para 84. In exchange for Ms. Sutton’s efforts, the Government alleges that Ms. Spencer while in the Southern District of West Virginia, remitted $3,000 of the fraudulent PPP proceeds to Ms.Sutton.Id.atpara.85.Basedontheseaccusations,Ms.Suttonischarged with “bank fraud” in violation of 18 U.S.C. § 1344(1)&(2). Assumingforthepurposesof thisMotionthattheallegationsoftheabove-captionedfacts(andIndictment)aretrue,the Government cannot establish Venue in the Southern District of West Virginia. Facts AccordingtotheGovernment,Ms.SuttoncausedafraudulentPPPloanapplication and Schedule C tax forms to be submitted electronicallyfromaresidenceinNewJersey City,NewJersey.ThisallegationissupportedbyevidencethatanIPaddresslinkedtoMrs. Sutton’s name was captured when the application was submitted and received by a third-party vendor website called “Womply”. Womply is not a bank or a financial institutionasdefinedbyfederallaw,butinsteadwasafinancialtechnologycompanythat actedasafacilitatortomatchPPPapplicantstolenders.Basedoninformationandbelief, Womply had no servers in the Southern District of West Virginia. With this particular PPPloanapplication,Womplyelectronicallymatchedawilling lender, Fountainhead SBF LLC (“Fountainhead”), out of Lake Mary, Florida, to fund Ms. Spencer’s fictitious PPP loan. Based on information provided by the Government, Fountainhead’s servers are located in Atlanta, Georgia. However, it is believed that Case 2:24-cr-00192 Document 192 Filed 05/08/25 Page 2 of 9 PageID #: 1040 Fountainhead’s servers never actually received the electronic application because Fountainhead was relying exclusively on Womply to underwrite and approve the loan applicationsatthattime.Regardless,noneofthisinformationwastransmittedthroughthe Southern District of West Virginia. Upon funding the PPP Loan on April 30, 2021, Fountainhead (or possibly Community Bankshares, Inc located in Georgia) electronically deposited, via ACH, the $15,625 PPP proceeds into Ms. Spencer’s CashApp account.CashAppisaSanFrancisco, CaliforniaCompany,butisnotacertifiedbusinessinWestVirginia.Thereisnoreasonto believe that CashApp has servers that process electronic ACH money transfers in the Southern District of West Virginia. Finally,allofthefundingforPPPloanswasfederallybackedbytheSmallBusiness Administration. Based on information received from the Government, no servers processingPPPloans,whichwereelectronicallyreceived,resideintheSouthernDistrictof West Virginia. Law Federal Rule of Criminal Procedure 18 prescribes that “the government must prosecute an offense in the district where the offense was committed” unless a statute permitsotherwise.Fed.R.Crim.P.18.“BankFraud”asdefinedby18U.S.C.1344(1)&(2)is subject to the general federal venue statute, which states that a federalcriminaloffense which“beg[ins] in one district and completedinanother,orcommittedinmorethanone district,” may be “prosecuted in any district in which such offense begun, continued, or completed.” 18U.S.C.3237(a).Venue is“determinedfromthenatureofthecrimealleged and the location of the act oractsconstitutingit.”UnitedStatesv.Ebersole,411F.3d517, Case 2:24-cr-00192 Document 192 Filed 05/08/25 Page 3 of 9 PageID #: 1041 524 (4th Cir. 2005). This means that there may be more than one appropriate venue, including“avenueinwhichthedefendanthasneversetfoot.”UnitedStatesv.Bowens,224 F.3d302,309(4thCir.2000).However,venueisgenerallylimitedtotheplaceinwhichthe “essential conduct” elements of the offense occurred. Id. “In order to determine the propriety of venue, we must first identify the conduct constituting the offense and the location of the criminal acts.” UnitedStatesv.Bankole,39 F. App'x 839, 841–43 (4th Cir. 2002)citing United States v. Barnette,211 F.3d 803,813 (4th Cir. 2000). The inquiry into venue has twoparts.First,theCourtsmust“identifytheconduct constitutingtheoffense,UnitedStatesv.Smith,452F.3d323,334(4thCir.2006)(quoting UnitedStatesv.Rodriguez-Moreno,526U.S.275,279(1999)),becausevenueislimited“to the place of the essential conduct of the offense.” UnitedStatesv.Bowens, 224F.3d302, 309(4thCir.2000).Second,theCourtdetermineswherethecriminalconducttookplace. Smith,452 F.2d at 334. In determiningtheessentialconductelementscourtsmay“analyzethekey‘verbs’ oractionssanctionedbythestatute[.]”UnitedStatesv.Sterling,860F.3d233,241(4thCir. 2017) (quoting UnitedStatesv.Rodriguez-Moreno,526 U.S. 275, 279 (1999). “Actswhich are merely ‘preparatory’ to the underlying offense and its essential conduct, however, cannot provide a basis for venue.” Id. at 241. Similarly, acts which occur only in furtherance of the crime or after a crime is complete cannot provide a basis for venue because they are not essential to the underlying offense.” UnitedStatesv.Jefferson, 674 F.3d 332, 367 (4th Cir. 2012) (finding venue improper for a wire fraud case because althoughactsinfurtheranceofthecrimeoccurredintherelevantdistrict,“thephysicalact of transmitting the wire communication for the purposeofexecutingthefraudscheme,” Case 2:24-cr-00192 Document 192 Filed 05/08/25 Page 4 of 9 PageID #: 1042 didnot);UnitedStatesv.Harris,No.3:12-cr-170,2013WL1790140,at*2(E.D.Va.Apr.26, 2013)(actiontakenafteracrimeiscomplete“doesnotqualifyasessentialconductofthe offense for the simple reason that the crime has already been completed”). Argument The essential conduct element of “Bank Fraud” is the execution of a scheme to defraudafinancialinstitution.Asitrelatestothiscase,Ms.Sutton’smouseclicksubmitting the PPP loan application and Schedule CwithknowinglyfalseinformationinNewJersey City, New Jersey to the Womply platform and Fountainhead’s funding of the $15,625 in LakeMary,FloridaorthroughitsserversinAtlanta,GeorgiatoanaccountwithCashApp wastheessentialconductmakingupthebankfraudallegation.Inotherwords,thiswasall that wasnecessarytocompletethecrimeandnoneofthattouchestheSouthernDistrict of West Virginia. The fact that it is alleged that Ms. Sutton and Ms. Spencer devised a scheme to defraud is irrelevant. You cannot commit bank fraudbydevisingaschemeto defraud, it is the execution that matters. Likewise, it is irrelevant that Ms. Spencer may have sent Ms. Sutton $3,000 as a kickback,becausethecrimeofbankfraudhadalready beencompletedatthepointwhereshesubmittedthefalseapplication.Theexecutionofa BankFraudschemedoesnotrequirethereceivingoffunds.Atbest,theexecutionbegan inNewJerseyandatworstendedwhenFountainheadreceivedtheapplicationinFlorida- if they received it at all. There are multiple cases that support this analysis. In United States v. Bankole, 39 F.App’x 839 (4th Cir. 2002)(per curiam), the Defendant was Indicted on Bank Fraud charges for initiating a debit transaction from Maryland (in our case New Jersey) which resulted in a transfer of fundstoavendorin New Hampshire (in ourcaseCashApp-California)thatwaseffectedwhentheelectronic Case 2:24-cr-00192 Document 192 Filed 05/08/25 Page 5 of 9 PageID #: 1043 request was received and processed by the bank in Virginia (in our case wherever Womply servers areorFountainheadServersinAtlanta).TheCourtheldthatthatvenue wasproperintheEasternDistrictofVirginia,because“thebankfraudoffensewasbegun inMaryland,continuedintoNewHampshire,andwascompletedintheEasternDistrictof Virginia.” Id.Thismakessensebecausethemoneybeingmovedprocessedthroughthese jurisdictions. Unlike Bankole, the Government in this caseisattemptingtohitchvenueto Ms. Spencer’s transaction in the Southern District of West Virginia after her Bank, CashApp, received the money outside of West Virginia. UnitedStatesv.Verclas,No.GJH-18-160,2019WL95148(D.Md.Jan.3,2019),isa good example of what the Governmentistryingtodointhiscase-whichis,basevenue offofMs.Spencer’sactoftransferringportionsofthePPPloanproceedsintheSouthern DistrictofWestVirginiabacktoMs.SuttonaftertheessentialconductofBankFraudhad been completed. The Court would not allow it. TheDefendantinVerclassubmittedagrantapplicationthatfalselyrepresentedthat her Delaware based corporation was a New York non-profit organization with the legal authoritytoapplyforthegrant.Basedontheapplication,theStateDepartmentawarded Verclas’ corporation the grant money. She later withdrew it and used it on personal expenses.Thisisexactlytheconductinthecasebeforethiscourt. Todistributethegrant funds, the State Department used a Payment Management System located in Maryland. Verclas used the Payment Management System to withdraw the funds for her personal use.TheGovernmentchargedherwithaviolationoftheMajorFraudAct18U.S.C.§1031. Verclas moved to dismiss the Indictment challenging venue and arguing that the Indictment fails to allege facts showing that she committed the charged offense in the Case 2:24-cr-00192 Document 192 Filed 05/08/25 Page 6 of 9 PageID #: 1044 DistrictofMaryland.TheGovernmentarguedthatheraccessingthePaymentManagement System to withdraw the funds, which were processed in Maryland, after they were received gave Maryland jurisdiction. The Court first determined what the conduct element to Major Fraud was and determined it was not the scheme to defraud, buttheknowingexecutionofthescheme. The Court held thatVerclasexecutedherschemetodefraudandobtainmoneyfromthe GovernmentwhenshesubmittedherfraudulentgrantapplicationfromherofficesinNew York. There was no allegation that this submission occurred or involved Maryland. The schemetodefraudwastoobtainthegrantmoneybysubmittingafraudulentapplication. The Court further, and more importantly, held that once the Defendant submitted the application, the scheme had been executed and she did not need to engage in any additional conduct to commit the crime. Because actually obtaining the money isnotan element of Major Fraud, much lessanessentialconductelement,itisnotrelevanttothe venue inquiry that the State Department awarded the funds through a Maryland based PaymentSystem.TheCourtheldthatactiondidnotcontributetoanyelementofthecrime and was not an essential conduct element. Conclusion WHEREFORE, the Defendant respectfully requests the Court enter and Order dismissing Count Nine for lack of venue and for other such relief as is necessary and proper. Respectfully submitted, By Counsel Case 2:24-cr-00192 Document 192 Filed 05/08/25 Page 7 of 9 PageID #: 1045 S://Connor D. Robertson________ Connor Robertson (11460) ROBERTSON LAW PLLC 2939 Virginia Avenue, Suite 2010 Hurricane, WV 25526 (304) 557-1601 cdr@croblaw.com Case 2:24-cr-00192 Document 192 Filed 05/08/25 Page 8 of 9 PageID #: 1046 IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF WEST VIRGINIA CHARLESTON UNITED STATES OF AMERICA, PLAINTIFF, V. CASE NO.: 2:24-CR-000192-01 KISHA SUTTON, DEFENDANT. CERTIFICATE OF SERVICE I, Connor Robertson, certify that on the 8th day of May, 2025, a copy of the foregoing motion was served on theUnitedStatesbyECF,toJonathanStorage,Assistant United States Attorney to the following: Jonathan Storage Assistant United States Attorney Jonathan.Storage@usdoj.gov S:// Connor D. Robertson Connor Robertson (11460) ROBERTSON LAW PLLC 2939 Virginia Avenue, Suite 2010 Hurricane, WV 25526 (304) 557-1601 CDR@CROBLAW.COM Case 2:24-cr-00192 Document 192 Filed 05/08/25 Page 9 of 9 PageID #: 1047
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