Court filing — United States v. Tracy D. Wade (Doc. 165)

Record facts

U.S. District Court for the Southern District of Florida · No. 0:23-cr-60173-KMW · Doc. 165 · 2024-09-27 · Docket on CourtListener

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UNITED STATES DISTRICT COURT 
SOUTHERN DISTRICT OF FLORIDA 
 
CASE NO. 23-60173-CR-KMW(s) (GRAHAM) 
 
UNITED STATES OF AMERICA  
 
 
 
 
 
 
vs. 
 
 
 
 
  
   
 
 
CAROLYN DENISE WADE and 
TRACE D. WADE, 
 
            
 
Defendants. 
________________________________________/ 
 
UNITED STATES’ REPLY TO  
DEFENDANT TRACY D. WADE’S RESPONSE IN OPPOSITION  
TO THE UNITED STATES’ NOTICE OF INTENTION TO INTRODUCE EVIDENCE 
OF OTHER CRIMES, WRONGS, OR ACTS, PURSUANT TO FED. R. EVID. 404(b)(2)  
 
Introduction 
 
The United States of America, by and through its undersigned counsel, hereby replies to 
“Defendant Tracy Wade’s Response in Opposition to the Government’s Notice of Intent to 
Introduce Evidence of Other Crimes, Wrongs, or Acts Pursuant to Fed. R. Evid. 404(b)(2),” which 
Defendant Tracy D. Wade (“Defendant”) filed on September 24, 2024 (DE 156) (the “Response” 
or “Resp.”).1     
 
In the Response, Defendant asserts that the Wade Funeral Home EIDL Applications are 
inadmissible under Rule 404(b) for two reasons: (1) the evidence is “not probative of any issue 
other than Mr. Wade’s character;” and (2) “the probative value of the evidence [is] substantially 
outweighed by unfair prejudice and confusion of the issues.”  However, as explained herein, the 
Response fails to rebut the legal basis for admitting the Wade Funeral Home EIDL Applications 
 
1 The government filed the 404(b) Notice on August 22, 2024 (DE 135).  During a telephonic status 
conference on September 23, 2024, the Court asked defense counsel if it intended to respond to the 404(b) 
Notice.  Defense counsel advised that it would respond to the 404(b) Notice no later than September 24, 
and the Court permitted the government to file any reply by 1:00 p.m. on Friday, September 27.  
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that the government set forth in its 404(b) Notice (DE 135).  Accordingly, the Court should admit 
the Wade Funeral Home EDIL Applications under Rule 404(b)(2).    
Argument 
1. 
The Response fails to rebut that the Wade Funeral Home EIDL Applications 
are relevant to an issue other than Defendant’s character.  
 
 
In conclusory form, the Response asserts that “the evidence of the EIDL loan applications 
is not probative of any issue other than Mr. Wade’s character, which is prohibited under Fed. R. 
Evid. 404(a)(1).”  Resp. at 3.  However, the Response does not directly address, much less rebut, 
the grounds set forth in detail in the 404(b) Notice upon which the government seeks to properly 
admit the Wade Funeral Home EIDL Applications (that is, proof of motive, intent, knowledge, 
absence of mistake or accident, and identity with respect to the charged offenses).  See 404(b) 
Notice (DE 135) at 9-11.  Instead, the Response offers defenses that raise questions of fact for the 
jury to consider, not a legal basis for the Court to exclude the evidence in the first place under Rule 
404(b), which is a rule of inclusion. 
 
For example, the Response suggests that the Wade Funeral Home EIDL Applications are 
inadmissible because the inflation of income reflected therein “most likely resulted from a mistake 
by Mr. Wade or caused by the software guiding the online application process.”  Resp. at 3.  That 
is a question of fact for the jury to consider.  For the threshold issue of admissibility, as the 
government articulated in the 404(b) Notice, the Wade Funeral Home EIDL Applications are 
relevant to show, among other things, Defendant’s motive and intent to obtain pandemic assistance 
from the SBA that he was not entitled to receive, which is the essence of the conduct charged in 
the Superseding Indictment. 
 
Although the PPP and EIDL were different programs through which the SBA offered 
pandemic assistance to small businesses, the 404(b) evidence shows that, almost immediately after 
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the SBA was authorized to provide such assistance at the start of the pandemic in 2020, Defendant 
submitted two separate EIDL applications for pandemic relief, each of which inflated Wade 
Funeral Home’s revenue and expenses (i.e., income) by hundreds of millions of dollars.  By 
inflating income in this way, Defendant’s applications sought not just $80,100 from the SBA (the 
amount of the EIDL loan that Defendant ultimately received), but the maximum available amount 
under the pandemic EIDL program—$150,000 for each application ($300,000 total).  Defendant’s 
two EIDL Applications, which Defendant certified as true under penalty of perjury, are therefore 
highly probative of Defendant’s motive and intent with respect to the PPP loan applications that, 
as alleged in the Superseding Indictment, likewise sought for each Defendant the maximum PPP 
loan available (to a sole proprietorship) based on inflated gross income.   
 
Additionally, the government articulated in the 404(b) Notice that evidence of Defendant’s 
prior acts of inflating Wade Funeral Home’s income in the EIDL applications is properly 
admissible under 404(b) to show that the subsequent inflation of income in the charged offenses 
(that is, the Tracy Wade, Carolyn Wade, and Wade Funeral Home PPP Applications) was not a 
mistake or accident.  404(b) Notice (DE 135) at 10.  The Response does not rebut this point either. 
 
The Response also suggests the Wade Funeral Home EIDL Applications are inadmissible 
because “Mr. Wade’s applying for an EIDL does not suggest that Mr. Wade was familiar with the 
PPP loan application process.”  Resp. at 4.   This too is a defense that raises a question of fact for 
the jury.  For purposes of admissibly, the government explained in the 404(b) Notice that the Wade 
Funeral Home EIDL Applications are admissible to show Defendant’s knowledge with respect to 
the charged conduct because the EIDL records included the same type of information supplied in 
the Wade Funeral Home PPP Application, including the number of employees.  See 404(b) Notice 
(DE 135) at 10.  In the Wade Funeral Home EIDL Application submitted on April 10, 2020, 
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Defendant represented (under penalty of perjury) that Wade Funeral Home had 10 employees in 
2020, which was the maximum number of employees for which a business could receive forgivable 
advance EIDL funds of $1,000 per employee.2  Yet, in the Wade Funeral Home PPP Application, 
which was based on the business’s payroll, the application represented that Wade Funeral Home 
had 45 employees in 2020.   As explained in the 404(b) Notice, this evidence is admissible to show 
that Defendant knew that Wade Funeral Home did not have “45” employees, and that this false 
representation in the Wade Funeral Home PPP Application was not a mistake or accident (but an 
intentional misrepresentation to apply for a PPP loan of over $700,000). 
2. 
The Response fails to show that the Wade Funeral Home EIDL Applications 
are substantially outweighed by unfair prejudice under Rule 403. 
 
 
The Response asserts the Wade Funeral Home EIDL Applications are “excludable under 
Fed. R. Evid. 403 because the probative value of the evidence [is] substantially outweighed by 
unfair prejudice and confusion of the issues.”  However, the Response does not articulate or 
otherwise identify any unfair prejudice to Defendant.  As stated in the 404(b) Notice, relevant 
evidence is inherently prejudicial, which is why Rule 403 concerns “unfair” prejudice and “cannot 
be simplistically defined as evidence having adverse effects on a party’s case.”  404(b) Notice (DE 
135) at 13 (quoting Cauchon v. United States, 824 F.2d 908, 914 (11th Cir. 1987)).  Furthermore, 
any risk of jury confusion can be addressed by a limiting instruction from the Court, such as the 
Eleventh Circuit’s pattern instruction on Rule 404(b) Evidence (e.g., Instruction S4.1). 
 
2 In the second Wade Funeral Home EIDL Application, submitted on May 7, 2020, Defendant represented 
that Wade Funeral Home had 5 employees.  
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3. 
The Response does not distinguish the EIDL evidence offered under Rule 
404(b) in this case from the EIDL evidence admitted at trial in United States v. 
Stephanie Smith under Rule 404(b). 
 
 
The Response offers no distinction between this case and United States v. Stephanie Smith 
in which Judge Cohn admitted similar evidence of an EIDL application under Rule 404(b) for the 
same purposes upon which the government seeks to admit the evidence in this case.  See Docket 
23-CR-60203, ECF No. 58 (“Order re Admissibility of EIDL Application”) at 2-3).  As in this 
case, the Judge Cohn noted that the “EIDL application [the Rule 404(b) evidence] was submitted 
several months prior to the Paycheck Protection Program (“PPP”) loan applications [alleged in the 
indictment] and provided the same type of information supplied in the PPP loan applications.”  Id. 
at 1.  As such, Judge Cohn found that “[t]he EIDL evidence is probative of the Defendant’s 
familiarity with the SBA’s processing of loan applications including both PPP loans and EIDL 
loans.”  Id. at 2.  Judge Cohn concluded that “the EIDL evidence bears strongly on the Defendant’s 
motive, intent, knowledge, identity, and absence of mistake with respect to the charged scheme to 
defraud” and “the probative value of this evidence is not substantially outweighed by the 
prejudicial effect.”  Id. at 2-3.  The Wade Funeral Home EIDL Applications are admissible in this 
case for the same reasons that the EIDL evidence was admitted at trial in that case. 
 
 
[Remainder of Page Intentionally Blank] 
 
 
 
 
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Conclusion 
The evidence identified in the government’s 404(b) Notice (DE 135) related to the Wade 
Funeral Home EIDL Applications is, to the extent not otherwise admitted, admissible pursuant to 
FRE 404(b)(2) as prior uncharged crimes, wrongs, and acts relevant to prove motive, intent, 
knowledge, absence of mistake or accident, and/or identity with respect to the offenses charged in 
the Superseding Indictment. 
Respectfully submitted, 
 
    
MARKENZY LAPOINTE 
  
UNITED STATES ATTORNEY 
 
By: /s/ David A. Snider  
 
 
 
 
 
 
 
 
 
David A. Snider 
Assistant United States Attorney 
Court ID No. A5502260 
500 E. Broward Blvd 
Fort Lauderdale, FL  33394 
Tel: (954) 660-5696 
Fax: (954) 356-7336 
Email: david.snider@usdoj.gov 
Case 0:23-cr-60173-KMW   Document 165   Entered on FLSD Docket 09/27/2024   Page 6 of 6

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