Order on Government's Motion in Limine and Rodriguez Arteaga's Motion to Strike — United States v. Hernandez

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Order on Government's Motion in Limine and Defendant Rodriguez Arteaga's Motion to Strike the Motion in Limine, entered November 1, 2024, in United States of America v. Lazaro Verdecia Hernandez and Yadier Rodriguez Arteaga, Criminal Case No. 23-20421, Southern District of Florida. The Court grants in part the Government's motion in limine to admit "inextricably intertwined evidence" (ECF No. 70) and denies the motion to strike (ECF No. 80). It notes that the Government withdrew its request on the credit card scheme related to the automotive body shop. It finds the prior acts show the three co-defendants "had a past, successful working relationship". The order is by United States District Judge Robert N. Scola, Jr.

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Case 1:23-cr-20421-RNS Document 84 Entered on FLSD Docket 11/01/2024 Page 1 of 3




                            United States District Court
                                      for the
                            Southern District of Florida

   United States of America                )
   v.                                      )
   Lazaro Verdecia Hernandez and           )   Criminal Case No. 23-20421
   Yadier Rodriguez Arteaga,               )
   Defendants.                             )

      Order on Government’s Motion in Limine and Defendant Rodriguez
               Arteaga’s Motion to Strike the Motion in Limine
     This matter comes before the Court on the Government’s motion in limine to
  admit inextricably intertwined evidence (ECF No. 70) and Defendant Yadier
  Rodriguez Arteaga’s motion to strike the Government’s motion in limine. (ECF
  No. 80.) On November 1, 2024, the Court heard oral arguments on the motions
  ahead of trial. Having considered the motions, the arguments presented by
  counsel, the record, and the relevant legal authorities, the Court grants in part
  the Government’s motion in limine (ECF No. 70), and the Court denies
  Defendant Rodriguez Arteaga’s motion to strike. (ECF No. 80.)
     Defendants Verdecia and Rodriguez face wire fraud and money laundering
  charges stemming from their alleged participation in a scheme to defraud the
  Paycheck Protection Program (“PPP”). (Indictment, ECF No. 1.) The Government
  sought to admit “inextricably intertwined evidence” of two credit card schemes
  and a small business loan scheme that preceded the alleged PPP fraud
  conspiracy. (ECF No. 70.) The Government attests that it will admit such
  evidence via the testimony of Co-Defendant Heidi Cid and through her
  notebook entries. (Id. at 4.)
     The first credit card fraud scheme, according to the Government, started
  with Defendant Verdecia executing fraudulent transactions using other
  peoples’ credit cards; “Verdecia would then return the items purchased for
  cash or sell them for cash.” (Id.) The Government alleges that Cid accompanied
  Verdecia on trips in furtherance of the scheme and recorded purchases and
  credit cards in her notebook. (Id.) Further, the Government alleges that
  Defendant Rodriguez joined the credit card scheme in 2019, that he received
  fraudulently obtained credit cards or merchandise at his home, and Cid’s
  notebook details Rodriguez’s residence as the delivery location for stolen items
  below victims’ information. (Id.)
     In the motion, the Government also sought to introduce evidence of a
  second credit card fraud scheme. (Id. at 5.) However, at the hearing, the
  Government agreed that it would not introduce evidence of the credit card
Case 1:23-cr-20421-RNS Document 84 Entered on FLSD Docket 11/01/2024 Page 2 of 3




  scheme related to Verdecia’s automotive body shop in its case in chief, and
  therefore withdrew that request. The Government reserves the right to
  introduce this evidence in rebuttal.
       The third scheme the Government seeks to admit allegedly preceded the
  alleged PPP fraud. (Id.) According to the Government, Cid will testify that prior
  to the COVID-19 pandemic, she and Verdecia transferred ownership of two of
  their companies to their co-conspirators from the automotive body shop credit
  card scheme. (Id. at 5-6.) The Government seeks to introduce evidence that
  they used the companies to perpetuate small business loan fraud, a scheme
  which “evolved” into the charged PPP fraud conspiracy. (Id. at 6.)
       Pursuant to Federal Rule of Evidence 404(b), “[e]vidence of other crimes,
  wrongs, or acts” is inadmissible to prove character or propensity, but it is
  admissible for other purposes. Fed. R. Evid. 404(b); United States v. Chavez,
  204 F.3d 1305, 1316–17 (11th Cir. 2000). Evidence is admissible under 404(b)
  if it is relevant for a non-propensity purpose, if the jury can find the prior act
  occurred, and if the evidence satisfies Rule 403. Id. The non-propensity
  reasons outlined by rule 404(b) include “proving motive, opportunity, intent,
  preparation, plan, knowledge, identity, absence of mistake, or lack of accident.”
  Fed. R. Evid. 404(b)(2).
       Evidence “falls outside the scope of rule 404(b)’s prohibition if it is ‘intrinsic’
  to the charged offenses.” United States v. Munne, No. 23-10258, 2024 WL
  4003395, at *4 (11th Cir. Aug. 30, 2024) (citing United States v. Estrada, 969
  F.3d 1245, 1274 (11th Cir. 2020). Intrinsic acts are those that “arose out of the
  same transaction or series of transactions as the charged offense,” are
  “necessary to complete the story of the crime,” or are “inextricably intertwined
  with the evidence regarding the charged offense” Id. (cleaned up).
       When evidence shows “why coconspirators agree to commit crimes with one
  another”, such facts “are intrinsic to a charged conspiracy.” Id. (collecting
  cases). Specifically, when the prior acts show the co-conspirators “had a past,
  successful working relationship,” such acts are intrinsic and therefore outside
  the scope of Rule 404(b)’s prohibition.
       Here, the prior acts the Government seeks to introduce at trial similarly
  illustrate that the three co-defendants “had a past, successful working
  relationship.” See id. The Government will introduce testimony about the prior
  schemes not to show propensity, but to demonstrate how the Defendants were
  “able to carry out such a large conspiracy in such a short period of time” and
  why the Defendants were willing to enter into the conspiracy with one another.
  (ECF No. 70); see also Munne, No. 23-10258, 2024 WL 4003395, at *4. The
  evidence will be introduced via the testimony of a co-defendant, which is
  sufficient to establish the prior acts’ occurrence by the preponderance of the
  evidence. See Munne, No. 23-10258, 2024 WL 4003395, at *5 (holding a “single
  witness’s ‘uncorroborated testimony’ can be sufficient to prove other acts’
Case 1:23-cr-20421-RNS Document 84 Entered on FLSD Docket 11/01/2024 Page 3 of 3




  existence). Finally, the probative value of the prior acts evidence—illustrating
  how the Defendants were able to carry out the conspiracy in such a short
  period of time, showing why they were willing to enter into the conspiracy, and
  demonstrating their past successful working relationship—is not substantially
  outweighed by the risk of unfair prejudice.
     Thus, the Court grants in part the Government’s motion in limine (ECF No.
  70), and the Court denies Defendant Rodriguez Arteaga’s motion to strike.
  (ECF No. 80.)


        Done and ordered in Miami, Florida, on November 1, 2024.




                                             ________________________________
                                             Robert N. Scola, Jr.
                                             United States District Judge


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