United States v. Matthew William Wheeler ( 2021 )

USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 1 of 53
[PUBLISH]
In the
United States Court of Appeals
For the Eleventh Circuit
____________________
No. 17-15003
____________________
UNITED STATES OF AMERICA,
Plaintiff-Appellant-Cross-Appellee,
versus
MATTHEW WILLIAM WHEELER,
a.k.a. Matthew Williams,
JAMES WAYNE LONG,
a.k.a. J.W. Long,
Defendants-Appellees-Cross-Appellants.
____________________
Appeal from the United States District Court
for the Southern District of Florida
D.C. Docket No. 1:16-cr-20715-MGC-9
____________________
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 2 of 53
2 Opinion of the Court 17-15003
____________________
No. 17-15030
____________________
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
ANITA SGARRO,
a.k.a. Anita Simone,
CHARLES DAVID SMIGROD,
a.k.a. Charles David,
CHARLES K. TOPPING,
a.k.a. CharlieKenn,
Defendants-Appellants.
____________________
Appeal from the United States District Court
for the Southern District of Florida
D.C. Docket No. 1:16-cr-20715-MGC-5
____________________
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 3 of 53
17-15003 Opinion of the Court 3
____________________
No. 17-15379
____________________
UNITED STATES OF AMERICA,
Plaintiff-Appellant-Cross-Appellee,
versus
JAMES WAYNE LONG,
MATTHEW WILLIAM WHEELER,
a.k.a. Matthew Williams,
Defendants-Appellees-Cross-Appellants.
____________________
Appeal from the United States District Court
for the Southern District of Florida
D.C. Docket No. 1:16-cr-20715-MGC-12
____________________
Before WILSON, LAGOA, and BRASHER, Circuit Judges.
PER CURIAM:
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 4 of 53
4 Opinion of the Court 17-15003
This is a criminal appeal involving five co-defendants who
were charged with wire fraud, mail fraud, and conspiracy for their
alleged involvement in a telemarketing scheme to defraud stock
investors. After an eight-week trial, in which the defendants made
several motions for mistrial, the jury found each defendant guilty
on all counts. At a post-trial hearing, the district court found that
the prosecution had acted improperly in closing argument but de-
nied the defendants’ motions for mistrial. The court then granted
judgments of acquittal based on insufficient evidence as to defend-
ants Matthew Wheeler and James Wayne Long. As to the other
three defendants—Charles Smigrod, Anita Sgarro, and Charles
Topping—the court denied their motions for judgment of acquit-
tal.
The government appeals the judgments of acquittal granted
to Wheeler and Long. Smigrod, Sgarro, and Topping appeal the
court’s denial of their motions for judgment of acquittal and argue
that, in the alternative, prosecutorial misconduct warranted a mis-
trial. Additionally, Sgarro and Topping argue that we should re-
verse their convictions based on a variety of erroneous evidentiary
rulings and improper jury instructions. They also challenge their
sentences. Wheeler and Long join their co-defendants in arguing
on cross-appeal that even if we find that the jury’s verdict was based
on sufficient evidence, prosecutorial misconduct tainted the trial
and requires us to reverse the convictions. We consolidated the
appeals and cross-appeal after briefing on the merits.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 5 of 53
17-15003 Opinion of the Court 5
After careful review and with the benefit of oral argument,
we reverse the judgments of acquittal granted to Wheeler and
Long because there is a reasonable construction of the evidence
that supports the jury’s verdicts as to those two defendants. We
also find that sufficient evidence supported the convictions of
Sgarro, Smigrod, and Topping. On the question of prosecutorial
misconduct, we find that the prosecution’s behavior at trial did not
rise to the level of misconduct. Nor do any of the district court’s
evidentiary rulings or the jury instructions warrant reversal. Fi-
nally, we find no error in the district court’s sentencing of Sgarro,
Smigrod, and Topping.
I. Factual and Procedural Background
A. The Stock-Selling Operation
The government charged the defendants in this case for
their alleged roles in a telemarketing scheme that tricked investors
into making stock purchases and misappropriated their money.
The defendants operated from two phone rooms. One was located
in Florida and managed by Miguel Mesa; the other was located in
California and managed by Sgarro. Both phone rooms initially sold
the stock of a company called Sanomedics International Holdings;
the Florida phone room later switched to selling the stock of a gam-
ing company called Fun Cool Free, Inc. (FCF). Sanomedics, which
was run by Craig Sizer (owner and founder), Keith Houlihan
(CEO), and Mesa (in charge of Sanomedics’ stock-selling
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 6 of 53
6 Opinion of the Court 17-15003
operation),1 manufactured and marketed a non-contact infrared
thermometer. Its stock was listed on the over-the-counter mar-
ket. 2 FCF sold a video game that was available for purchase on
Apple’s App Store.
Each of the five defendants had a particular role in the stock-
selling operation. Wheeler, Long, and Smigrod worked as sales-
people in the Florida phone room. Wheeler, who sometimes used
the alias “Matt Williams” with investors, sold Sanomedics stock
from 2009 to 2012 and FCF stock during 2015. Long, using his real
name with investors, joined the operation near the tail end in 2015.
He sold FCF stock for about six months and had no involvement
in Sanomedics stock. Smigrod, going by the name “Charles David”
(his first and middle names), started out selling Sanomedics stock
and later transitioned to selling FCF stock.
The government alleged that Sgarro and Topping per-
formed a broader range of functions. Sgarro, as the manager of the
California office, instructed salespeople on how to pitch Sanomed-
ics stock. She also personally pitched and sold the stock, introduc-
ing herself to investors as “Anita Simone” from Sanomedics’ “in-
vestor relations.” Topping, using the moniker “Charlie Kenn,”
1 Sizer, Houlihan, and Mesa were all charged in the same indictment as the
defendants but pleaded guilty before trial.
2 An “over-the-counter” market is a securities market that functions without
a central exchange. Alan R. Bromberg & Lewis D. Lowenfels, Bromberg &
Lowenfels on Securities Fraud § 1:2 (2d ed.).
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 7 of 53
17-15003 Opinion of the Court 7
worked in the Florida office where he was a “loader.” As a loader,
Topping played an important role in a two-part process that was
often used by both the California and Florida locations. First, a
salesperson would cold call a potential investor using an autodialer
and would pitch an investment opportunity. Then, if the salesper-
son secured an initial investment, he would offer to connect the
investor with a high-level executive who would be able to sell spe-
cial “institutional” shares—or so investors were told. The govern-
ment alleged that Topping would play the role of that high-level
executive. If Topping successfully sold the investor additional “in-
stitutional” shares, both he and the referring salesperson would
make a commission on that transaction. Topping first sold Sano-
medics stock and later sold FCF stock.
Both the Florida and California phone rooms used prepared
written materials to aid their pitches to investors. There were press
releases, for example, that were created by Houlihan, posted
online, and distributed to the sales team by Mesa. Sizer and Mesa
also developed scripts for salespeople to use in their pitches. The
press releases and scripts contained some accurate information but
also included exaggerations and fabrications. Working partly off
these press releases and scripts, salespeople made false representa-
tions to potential investors, including that they were paid only in
company stock and did not work for commissions, and that im-
portant businesspeople or celebrities were involved in the com-
pany they were pitching.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 8 of 53
8 Opinion of the Court 17-15003
In addition, although Sanomedics and FCF were real com-
panies with real products—and investors were really issued stock
in the companies—investors were misled as to how their money
would be used. Salespeople often assured investors that their
money would fund business development and expansion plans, but
very little of the money actually was used for such purposes. Most
of the $23 million or so that investors sunk into Sanomedics and
FCF stock went to Sizer and Mesa. A little less than twenty percent
was split among ten salespeople, including the five trial defendants.
Between Sanomedics and FCF, the defendants took in the follow-
ing sums: $1,207,000 for Topping, $1,070,000 for Sgarro, $162,000
for Wheeler, $148,000 for Smigrod, and $17,000 for Long.
B. The Indictment
A September 2016 indictment charged thirteen co-defend-
ants with substantive mail and wire fraud and conspiracy to com-
mit mail and wire fraud. The indictment alleged conspiracy to
commit mail and wire fraud under 18 U.S.C. § 1349: Count 1 in
connection with Sanomedics and Count 11 in connection with
FCF. Counts 2 through 10 alleged mail fraud, 18 U.S.C. § 1341, and
wire fraud, 18 U.S.C. § 1343, in connection with the sale of Sano-
medics stock. 3 Counts 12 and 13 alleged mail fraud in connection
with the sale of FCF stock.
3 The government voluntarily dismissed Counts 4 and 5 before trial.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 9 of 53
17-15003 Opinion of the Court 9
Eight defendants—including ringleaders Sizer and Mesa—
pleaded guilty. The other five—Wheeler, Long, Smigrod, Sgarro,
and Topping—went to trial.
C. The Trial
Trial began in April 2017 and lasted eight weeks. Among the
witnesses who testified in the government’s case-in-chief were two
of the alleged co-conspirators who had pleaded guilty, sixteen in-
vestors who had bought stock from the defendants, and a confiden-
tial informant, Stuart Rubens, who took a job undercover in the
Florida phone room. Rubens testified that he had previously been
convicted of fraud for participating in a scheme similar to Sano-
medics. He highlighted similarities between the Florida phone
room and other criminal operations he had experience with, which
he referred to as “boiler rooms.” The government also presented
evidence of the defendants’ sales scripts and commission sheets,
along with other documents seized in an FBI raid of the Florida
phone room.
The record on appeal shows that the trial evidence included
the following. All the defendants but Long used an alias or nick-
name with investors. The defendants often claimed that they were
employees of the company they were pitching, although in truth
they worked for a company called Hemisphere Management that
was owned by Mesa. They claimed that they were paid only in
company stock, though they really made commissions of roughly
fifteen to twenty percent. They told investors that they were of-
fering stock in a company that was making—or was on the verge
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 10 of 53
10 Opinion of the Court 17-15003
of making—millions in profits, although the company was never
really close to generating profits of that scale. And they sometimes
told investors that the company they were pitching was associated
with a celebrity, a well-known business executive, or another suc-
cessful company—representations that were based on half-truths
or totally false.
After the government rested, the defendants called several
of their own witnesses. Houlihan, as the author of the Sanomedics
press releases, testified that much of the information in the press
releases was true although embellished. And Gary Miller, a sales-
person who worked for Sgarro in the California phone room, testi-
fied that he pitched Sanomedics stock to investors using infor-
mation he gathered from conference calls with Mesa. According
to Miller’s testimony, he believed that the information from Mesa
was true, and that Sanomedics was a good investment.
Miller’s testimony took a twist on cross-examination when
the prosecution asked whether he had “a different business” with
Sgarro. Miller denied having any business association with Sgarro
aside from selling Sanomedics stock. After some discussion with
counsel at sidebar, the court determined—over objections from the
defendants—that the prosecution could impeach Miller with a
prior inconsistent statement he had made to an FBI agent, to the
effect that he sold drugs with Sgarro. The district court ruled that,
under Federal Rule of Evidence 613(b), the prosecution could ask
Miller: “[D]id you ever tell Agent X that you sold marijuana to de-
fendant Sgarro[?]” And “[i]f the witness denies making the
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 11 of 53
17-15003 Opinion of the Court 11
statement,” the court determined, “the agent can be called to say
he made the statement.” Before proceeding, the court read the fol-
lowing limiting instruction to the jury:
[Y]ou determine the credibility of the wit-
nesses in this case. You decide who to believe and
what to believe. You are about to hear testimony that
this witness testified differently than his trial testi-
mony. . . . The testimony is not offered to prove the
truth of the statement. It is offered only to assist you
in determining the credibility of this witness.
The prosecution proceeded to cross-examine Miller. In
what was apparently a volatile exchange, the prosecutor asked Mil-
ler several times if he told the FBI that he sold marijuana with
Sgarro. Miller repeatedly denied having done so. In rebuttal, the
prosecution called an FBI agent who testified that Miller had in fact
made statements about selling drugs with Sgarro.
After the defendants rested, the parties’ attention turned to
the jury instructions. To provide some context, this case went to
trial in 2017 on the heels of our decision in United States v. Takha-
lov, 827 F.3d 1307 (11th Cir.), opinion modified on denial of
reh’g, 838 F.3d 1168 (11th Cir. 2016) (per curiam). Based on the
recent Takhalov decision, the defendants sought a jury instruction
after the close of evidence to convey the distinction between an
intent to deceive and an intent to defraud. The defendants’ theory
was this: evidence that the defendants used aliases or misrepre-
sented their employer, for example, might prove the defendants’
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 12 of 53
12 Opinion of the Court 17-15003
intent to deceive, but it would not prove their intent to defraud so
long as the investors got the stock they bargained for at the agreed-
upon price.
The defendants requested that the court insert clarifying lan-
guage from Takhalov in the jury instruction on the elements of the
offenses. Because the pattern instructions had not been updated
since Takhalov, the defendants argued that there was “confusion
between . . . the . . . instructions as they exist in the pattern versus
what Takhalov has cleared up.” 4 The court decided that it would
give the standard pattern instructions unaltered, but would also
give a theory-of-defense instruction that incorporated Takhalov.
The government would be allowed to attack the theory of defense,
the court explained, by arguing to the jury that the theory “doesn’t
match up with the evidence.”
In a charge conference on the twenty-seventh day of trial,
the government argued that telling the jury about Takhalov’s hold-
ing—even in a theory-of-defense instruction—would only confuse
them. The court maintained that while it would not alter the in-
structions on the elements of wire fraud, it would allow an instruc-
tion that presented the defendants’ theory that they lacked an in-
tent to harm under our holding in Takhalov.
4 We have since adopted new pattern jury instructions for mail and wire fraud
that incorporate Takhalov’s holding. See 11th Cir. Std. (Crim.) Jury Instr.
O50.3, O51 (2019) (“Proving intent to deceive alone, without the intent to
cause loss or injury, is not sufficient to prove intent to defraud.”).
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 13 of 53
17-15003 Opinion of the Court 13
The prosecutor expressed concern that the jury would lend
too much credence to the instruction if it came from the court.
[PROSECUTOR]: [The defendants] . . . can argue all
that until they get blue, and if they create a reasonable
doubt, they win, God bless them, but when it comes
from Your Honor’s mouth instructing the jury on
that theory, that’s where I take issue. I believe it’s un-
necessary.
The court stressed, however, that the law did not require
the jury to accept the defendants’ Takhalov defense. The applica-
tion of the defense theory to the facts of this case was for the jury
to determine.
THE COURT: I don’t want the jury to think this is
part of the actual substantive instruction. I want
them to understand this is defendants’ theory. . . .
[PROSECUTOR]: Judge, we’re making some pro-
gress. We agree that as long as it’s clear that this is
the defendants’ theory, not coming from Your
Honor—
...
THE COURT: That’s why I’m trying to take out an-
ything that says the law requires or this requires.
...
THE COURT: “[T]his is a theory, not a legal instruc-
tion.”
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 14 of 53
14 Opinion of the Court 17-15003
When the charge conference resumed the next day of trial,
the defense continued to argue that Takhalov was the law—it had
clarified that proving deception alone is not enough to sustain a
conviction. That legal framework should be presented to the jury,
the defendants argued, so that the jury could decide whether the
government proved more than mere deception in this case. The
prosecution, for its part, continued to spar with the court about
whether the theory-of-defense instruction, which highlighted that
the government had to prove more than an intent to deceive, was
necessary.
THE COURT: If you read the opening paragraph of
Takhalov, it says the wire fraud statute does not enact
as federal law the 9th commandment given to Moses
on Sinai. . . .
[D]eceiving does not always involve harming another
person. Defrauding does. That a defendant merely
induced the victim to enter into a transaction that he
otherwise would have avoided is, therefore, insuffi-
cient to show wire fraud. . . .
[PROSECUTOR]: But that’s not the holding, Judge.
That’s not the holding. That’s their introductory re-
marks. . . .
...
THE COURT: I don’t agree . . . .
Still, the prosecutor continued to argue that proving the de-
fendants’ intent to deceive was sufficient and that a contrary ruling
would be irreconcilable with the text of the mail fraud statute.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 15 of 53
17-15003 Opinion of the Court 15
[PROSECUTOR]: Do you believe Takhalov over-
ruled the mail fraud statute, Your Honor, or changed
it?
...
Judge, the wire fraud and mail fraud statutes have the
words.
...
You read it yourself, deceit is a form in which to prove
the fraud.
THE COURT: We’re going to have to agree to disa-
gree here.
The district court thus maintained that it would not alter the
instructions on the wire-fraud elements, but that it would include
a separate theory-of-defense instruction. The finalized instruction
read as follows:
It is Defendants’ Theory of Defense that they
did not knowingly and intentionally participate in a
fraud, and that the fraud actually occurred when, un-
beknownst to the Defendants, the owners and offic-
ers of the corporations, Craig Sizer and Keith Houli-
han, together with Miguel Mesa, stole millions of dol-
lars in investor funds. Although they may have been
aggressive salesmen, they did not intend to defraud
the investors, and that they were unwitting pawns in
the scheme orchestrated by the owners and Mesa to
steal investors’ funds [sic].
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 16 of 53
16 Opinion of the Court 17-15003
Defendants contend that there is a difference
between deceiving and defrauding. To defraud the
defendants must have intended to use deception to
cause financial harm to investors.
In other words, if a defendant selling stock rea-
sonably believes that it had value, and the price
charged reflects that value, his or her use of deceit
would not constitute a scheme to defraud. Deceiving
does not always involve harming another person; de-
frauding does.
Fraud requires proof of a material misrepre-
sentation, or the omission or concealment of a mate-
rial fact. Mere “puffing” or “seller’s talk” is insuffi-
cient.
Although the defendants had objected to framing the in-
struction as a theory of defense rather than an instruction on the
elements of the offense, they relied heavily on the instruction in
closing argument. Even if the defendants unwittingly deceived in-
vestors, they argued, the investors still got the number of shares
they bargained for at the price they bargained for. There was no
intent to harm investors, the argument went, because the defend-
ants thought they were selling valuable stock; they were unaware
that higher-ups in the organization were victimizing the investors
by pocketing the bulk of their investments.
Next came the prosecution’s rebuttal. The prosecution ar-
gued to the jury that the theory-of-defense instruction was “not the
Court’s instruction” [but] merely [the defense’s] theory.”
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 17 of 53
17-15003 Opinion of the Court 17
“[H]undreds of years ago,” he said, “it was a theory that the sun
revolved around the earth, and that the earth itself was flat. But as
we know, evidence has disproven those theories, similar to the case
at bar.” Shortly thereafter, the prosecution returned to the theory
of defense, directing the jury’s attention to page 23 of the court’s
instructions. “This page is very special,” he told the jury. “It’s spe-
cial because it’s not the law. It is not the law. Of the 32 pages in
your hands, 23 is no more—” Defense counsel then objected, but
the court overruled the objection and the prosecutor continued.
[PROSECUTOR]: It’s a theory of defense. Okay? 23
is, as you can see at the top—we’ll go through it real
quick—it is the defendant’s theory of defense. That’s
their theory. That’s the one where it says they were
unwitting. The next paragraph says the defendants
contend. They already told you what they contend.
They already had a shot. They all went. Some talked
for an hour. Some talked for an hour and 40 minutes.
. . . The rest of this page, again, is what they believe. .
. . So again, page 23, it’s in the packet. The Judge ob-
viously thought it was important for you to have it.
But ladies and gentlemen, this is not the law. This is
a theory of defense.
[DEFENSE COUNSEL]: Objection, Judge.
THE COURT: Sustained.
After the prosecutor concluded his closing argument and the
jury exited the courtroom, the court immediately admonished the
prosecutor for his “this-is-not-the-law” argument.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 18 of 53
18 Opinion of the Court 17-15003
THE COURT: You know, [ ] we worked very hard to
craft instructions in this case that maybe not everyone
agreed with but [ ] that I thought would pass legal
muster and for you to take the defendants’ theory of
the case instruction and basically tell the jury it’s a
joke, that was wrong. Wrong. Now, whether it rises
to the level of mistrial, . . . I’ll take care of at a later
point . . . . [B]ut you basically trashed the instruction
they asked for . . . .
The defense didn’t like it, you didn’t like it. It’s not
up to whether people like it, it’s as to whether I think
it’s a correct statement of the law, and I thought it
was.
The court then brought the jury back into the courtroom
and restated its general charge, including the following instruction:
“You must follow the law as I explained it to you, even if you do
not agree with it. And you must follow all of my instructions as a
whole. You must not single out or disregard any of the instructions
that I gave you in this trial.”
After sending the jury to deliberate, the court reiterated to
counsel that the theory-of-defense instruction “was appropriate
given the law and the facts of this case.” The court questioned why
the prosecution “would take our hard work . . . [in] crafting [the
instruction], and basically almost tell the jury it doesn’t matter.”
The government “can’t just disregard an instruction because . . .
they don’t like it,” the court added.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 19 of 53
17-15003 Opinion of the Court 19
Subsequently, the court heard oral argument on the defend-
ants’ motions for mistrial. Counsel for Sgarro pointed out that a
theory-of-defense instruction incorporates the defense’s view of
the facts, “but the law is what [the court] give[s] the jury.” “We
may not agree with the instruction that you gave,” he said, “but
that was your ruling.” He argued that the government’s decision
to “try to get this jury to do something contrary to what this Court
did,” was emblematic of a “pattern of misconduct” that had perme-
ated the trial. Counsel for the other defendants voiced similar con-
cerns. The prosecutor responded that he was “merely showing the
jury that [the defendants’] theory [was] not one supported by the
facts at hand.” And in his view, he reiterated, the theory of defense
was not the law. The court took the motions for mistrial under
advisement. After two days of deliberation, the jury convicted
each of the five defendants on all counts.
D. Post-Trial Hearing and Sentencing
Following the trial, the defendants moved for judgments of
acquittal, and the district court convened a hearing to take up the
post-trial motions. In reference to the motions for mistrial, the
court expressed at the hearing that, in hindsight, it “should have
sustained [the defense’s] original objection instead of overruling it”
and “should have maybe given a more forceful instruction to the
jury including rereading the theory of defense instruction.” The
court questioned the propriety of the government’s argument and
noted the magnitude of the harm it likely caused.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 20 of 53
20 Opinion of the Court 17-15003
THE COURT: [H]ere’s my problem . . . . Constantly
through[out] the trial . . . , the Court tells the jurors,
listen, at the end of the trial, I am going to give you
instructions, and this is the law that you are to follow.
Essentially what [the prosecutor] did was to negate
every time I said that. He basically said, just don’t
worry your pretty little heads about that instruction.
The prosecution insisted that its closing argument essen-
tially aligned with the court’s directions at the charge conference
that the theory of defense was not a legal instruction. The court
countered that what is said between the parties and the court when
“hammering out an instruction” is quite different than what can be
properly argued to the jury based on the court’s final ruling.
Nevertheless, the court denied the defendants’ motion for a
mistrial. It found that the defendants were entitled to a theory-of-
defense instruction, and that “the Government . . . chose an im-
proper path” in its closing argument. But the court also stated that
it could not find support for the proposition that a theory-of-de-
fense instruction is the law. For that reason, the court denied the
defendants’ motion.
The court, however, granted judgments of acquittal to
Wheeler and Long, holding that the government did not prove that
those defendants knew about the overarching scheme orchestrated
by Sizer and Mesa to misappropriate investors’ money. As to the
remaining three defendants, the district court denied their motions
for judgment of acquittal.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 21 of 53
17-15003 Opinion of the Court 21
At sentencing, the Presentence Investigation Reports (PSI)
held Smigrod and Sgarro responsible for a loss of $22,278,000 and
Topping responsible for a loss of $22,456,186. Sgarro’s PSI applied
a two-level enhancement for the use of sophisticated means during
the offense. Topping’s PSI included a three-level enhancement for
acting as a manager or supervisor. All three defendants had a crim-
inal history category of I. The district court sentenced each of them
to a prison term: 48 months for Smigrod, 116 months for Sgarro,
and 113 months for Topping. The court also ordered those three
defendants to serve a three-year term of supervised release and to
pay restitution.
II. Discussion
On appeal, Smigrod, Sgarro, and Topping argue that there
was insufficient evidence to support a number of their convictions.
The government cross-appeals the judgments of acquittal as to
Wheeler and Long, arguing that the guilty verdicts should be rein-
stated because they were supported by sufficient evidence. The
defendants argue that even if sufficient evidence supported their
convictions, the district court should have granted a mistrial be-
cause the prosecution engaged in misconduct. Sgarro and Topping
also appeal a handful of other issues related to evidentiary and sen-
tencing rulings, as well as the jury instructions.
In the following sections, we will address: (1) the sufficiency
of the evidence, (2) the defendants’ allegations of prosecutorial mis-
conduct, (3) the district court’s evidentiary rulings and the jury in-
structions; and (4) the district court’s sentencing determinations.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 22 of 53
22 Opinion of the Court 17-15003
When considering the sufficiency of the evidence, we review de
novo both the grant and denial of a judgment of acquittal, viewing
the evidence in the light most favorable to the government and
drawing all reasonable inferences in its favor. Butcher v. United
States, 368 F.3d 1290, 1297 (11th Cir. 2004); United States v. Capers,
708 F.3d 1286, 1296 (11th Cir. 2013). We will not overturn the jury
verdict “if any reasonable construction of the evidence would have
allowed the jury to find the defendant guilty beyond a reasonable
doubt.” Capers, 708 F.3d at 1296. When reviewing allegations of
prosecutorial misconduct in closing argument, our review is de
novo. United States v. Eckhardt, 466 F.3d 938, 947 (11th Cir. 2006).
We review for abuse of discretion a district court’s evidentiary rul-
ings. United States v. Williford, 764 F.2d 1493, 1497 (11th Cir.
1985). And in reviewing a district court’s application of the Sen-
tencing Guidelines, “we review purely legal questions de novo, and
the district court’s factual findings for clear error.” United States v.
Monzo, 852 F.3d 1343, 1348 (11th Cir. 2017).
A. Sufficiency of the Evidence
This appeal requires us to determine whether sufficient evi-
dence supported both the conspiracy and substantive counts of
mail and wire fraud as to the five defendants. To prove a conspir-
acy to commit mail and wire fraud under 18 U.S.C. § 1349, the gov-
ernment must prove that: “(1) a conspiracy existed; (2) the defend-
ant knew of it; and (3) the defendant knowingly and voluntarily
joined it.” United States v. Moran, 778 F.3d 942, 960 (11th Cir.
2015).
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 23 of 53
17-15003 Opinion of the Court 23
As to substantive mail and wire fraud, the government must
prove that a person: “(1) intentionally participate[d] in a scheme or
artifice to defraud another of money or property, and (2) use[d] or
‘cause[d]’ the use of the mails or wires for the purpose of executing
the scheme or artifice.” United States v. Langford, 647 F.3d 1309,
1320 (11th Cir. 2011). To prove that a defendant had the intent to
defraud, the Government has to prove that the defendants either
knew they were making false representations or acted with “reck-
less indifference to the truth.” See United States v. Simon, 839 F.2d
1461, 1466, 1470 (11th Cir. 1988).
We have explained that the government must prove not
only that the defendants had the intent to deceive, but also that
they intended to harm the victim, meaning that they intended to
deceive the victim about something that affected the value of the
bargain. Takhalov, 827 F.3d at 1313. A defendant can do this in
two ways: (1) lying about the price; or (2) lying about the charac-
teristics of the good. Id. at 1313–14. However, if a defendant lies
and says, for example, “that he is the long-lost cousin of a prospec-
tive buyer—then he has not . . . ‘schemed to defraud’” because that
misrepresentation does not go to the value of the bargain. Id. at
1314.
Takhalov used two hypotheticals to draw the key distinction
between deceptions that do not affect the value of the bargain and
those that do:
Consider the following two scenarios. In the
first, a man wants to exchange a dollar into four
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 24 of 53
24 Opinion of the Court 17-15003
quarters without going to the bank. He calls his
neighbor on his cell phone and says that his child is
very ill. His neighbor runs over, and when she arrives
he asks her to make change for him. She agrees; the
quarters pass to the man; the dollar passes to the
woman; and they part ways. She later learns that the
child was just fine all along. The second scenario is
identical to the first, except that instead of giving the
woman a true dollar, he gives her a counterfeit one.
The first scenario is not wire fraud; the second
one is. Although the transaction would not have oc-
curred but-for the lie in the first scenario—the
woman would have remained home except for the
phony sickness—the man nevertheless did not intend
to deprive the woman of something of value by trick,
deceit, and so on. But in the second scenario he did
intend to do so.
Id. at 1313 (footnote, citation, and quotation marks omitted and
alteration adopted). So to prove substantive mail and wire fraud,
the government must prove more than deceit; it must prove that
the defendant intended to deprive the victim of something of value.
Id.
1. Wheeler’s and Long’s Convictions
We discuss first the government’s appeal as to the suffi-
ciency of the evidence supporting the convictions of Wheeler and
Long. The indictment charged Long under Counts 11 (FCF con-
spiracy) and 12 (substantive mail fraud involving the sale of FCF
stock to an investor identified as R.L.), and it charged Wheeler
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 25 of 53
17-15003 Opinion of the Court 25
under Counts 1 (Sanomedics conspiracy), 11 (FCF conspiracy) and
13 (substantive mail fraud involving the sale of FCF stock to an in-
vestor identified as B.M.).
a. Substantive Counts
On the substantive counts—Count 12 against Long and
Count 13 against Wheeler—the district court found that the gov-
ernment did not prove the defendants’ intent to defraud investors.
On appeal, the government points to evidence that Wheeler and
Long lied about their employer, lied about their compensation
structure, and misled investors about the value of the stock they
were selling. After a thorough review of the record, we agree with
the government.
It is true that some of the misrepresentations Wheeler and
Long made to investors were not the type of fraudulent misrepre-
sentations that Takhalov requires the government to prove. Take,
for example, the claims that Wheeler and Long were employees of
the company they were pitching, or that Wheeler’s name was
“Matt Williams.” Like pretending to be the victim’s long-lost
cousin or feigning the illness of one’s child, these deceptions would
not affect the price or characteristics of the good being sold. See
Takhalov, 827 F.3d at 1313–14. Therefore, neither the salesper-
son’s employment status nor his use of an alias would amount to a
scheme to defraud.
There is evidence in the record, however, of Wheeler and
Long making misrepresentations or failing to disclose information
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 26 of 53
26 Opinion of the Court 17-15003
that a reasonable jury could find affected the nature of the bargain.
Both Wheeler and Long misled investors to believe that FCF had
made millions of dollars in profit and was closely associated with
high-profile companies and executives. Long told investors that
Apple was a partner with FCF and that John Sculley, a renowned
CEO, was involved in the company. Wheeler similarly told inves-
tors, including B.M., that Sculley was closely involved in FCF.
Wheeler and Long also misrepresented their form of compensa-
tion, telling investors that they were paid only in company stock
and did not make commissions on stock sales. The investors’
money, they said, would go back into the company. Finally, Long
misled investor R.L. to believe that FCF would be listed on the
NASDAQ stock exchange and “would be going public.”
A reasonable jury could infer that facts like FCF’s profits, its
association with a famous executive and a globally recognized tech-
nology company, and a potential listing on a major stock exchange
are essential characteristics of the stock that would alter the nature
of the bargain. See id. at 1313–14. The same is true of the defend-
ants’ misrepresentations about commissions. Although investors
presumably knew the salespeople were being paid somehow (and
there was testimony to that effect), a reasonable jury could have
found that it would decrease the value investors got from the bar-
gain if their money was going to a salesperson’s pocket in the form
of commissions, rather than injecting capital for FCF to expand or
to conduct research and development. See Simon, 839 F.2d at 1468
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 27 of 53
17-15003 Opinion of the Court 27
(salesperson falsely telling client she did not work for commissions
provided support for jury’s finding of intent to defraud).
And a reasonable jury could have inferred that Wheeler and
Long made these misrepresentations knowingly, or, at a mini-
mum, with “reckless indifference to the truth.” Id. at 1470. Nota-
bly, at least some of the defendants’ misrepresentations went be-
yond the information contained in scripts and press releases. For
example, a press release from Houlihan touted a connection be-
tween Sculley and Sanomedics based on a small investment that a
Sculley-owned company made in Sanomedics. But there were no
press releases connecting Sculley—or Apple for that matter—to
FCF. Further, there was evidence that the salespeople filled out
their own commission sheets to claim their share of each stock sale
and thus would have known they were paid in commissions.
The evidence against Long on Count 12 and against
Wheeler on Count 13 was not overwhelming. But considering the
evidence in the light most favorable to the government and draw-
ing all reasonable inferences and credibility choices in the govern-
ment’s favor, the evidence provided a basis for a reasonable jury to
conclude that Wheeler and Long schemed to defraud investors.
b. Conspiracy Counts
The district court also granted judgment of acquittal on the
conspiracy charges against Wheeler and Long, finding that even if
they made some misrepresentations to investors, they did not
know about the “overarching fraudulent scheme” perpetrated by
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 28 of 53
28 Opinion of the Court 17-15003
Mesa and Sizer to make off with investors’ money. The govern-
ment argues on appeal that no such knowledge is necessary to
prove a conspiracy to defraud. Wheeler and Long, defending the
district court’s ruling, point us to several cases. In United States v.
Toler, for example, we said that the “government must show an
‘interdependence’ among the alleged co-conspirators in order to
prove that the indicted conspiracy was a single unified conspiracy
as opposed to a series of smaller, uncoordinated conspiracies.” 144
F.3d 1423, 1426 (11th Cir. 1998).
We articulated a similar rule in United States v. Chandler,
376 F.3d 1303 (11th Cir. 2004). There, the defendants were charged
in a two-part mail fraud conspiracy. Id. at 1306. The “scheme was
a classic ‘hub-and-spoke’ conspiracy, in which a central core of con-
spirators recruits separate groups of co-conspirators to carry out
the various functions of the illegal enterprise.” Id. at 1316. Part
one of the conspiracy involved a single actor embezzling promo-
tional game stamps from McDonald’s Corporation. Id. at 1306. In
part two of the conspiracy, the embezzler would give the stamps
to his friends and family—the defendants—to redeem them. Id. A
jury found the defendants guilty of conspiracy to commit mail
fraud, and the district court denied their motions for judgment of
acquittal. Id. at 1305.
We reversed the denial of those motions on appeal and va-
cated the convictions. Although the defendants made misrepresen-
tations to McDonald’s in redeeming the game stamps, we stressed
that the indictment alleged a single conspiracy to accomplish two
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 29 of 53
17-15003 Opinion of the Court 29
objectives: (1) embezzle game stamps and (2) redeem those stamps.
Id. at 1318. The defendants agreed to help with the second objec-
tive, but—fatal to the government’s case—there was no evidence
that the defendants knew the game stamps had been embezzled.
Id. “[W]ithout proof of some connection” between the two objec-
tives, we said, the government had not proved the single conspir-
acy it alleged in the indictment. Id.In reaching this conclusion, the Chandler court found per-
suasive the Third Circuit’s decision in United States v. Pearlstein,
576 F.2d 531 (3d Cir. 1978). There, the defendants were salespeople
who allegedly used aliases and made misleading statements in their
sales pitches to customers. The salespeople generally used a script
developed by higher-ups in the organization but sometimes “added
a few exaggerations and misstatements” of their own. Id. at 539.
The Third Circuit reversed the defendants’ convictions for conspir-
acy and substantive mail fraud, reasoning that “although the de-
fendants might have made fraudulent misrepresentations during
the course of their individual sales presentations, the jury could not
reasonably infer that the salesmen knew of the fraudulent purpose
of the overall [fraudulent] scheme.” Id. at 545.
Wheeler and Long argue that, just like in those cases, the
government failed to prove that they knew about the “top to bot-
tom” conspiracy alleged in the indictment, which centered on Sizer
and Mesa pocketing most of the investors’ money. Long points to
testimony from Houlihan that Sizer operated “in a secretive man-
ner,” and argues that even if salespeople made some
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 30 of 53
30 Opinion of the Court 17-15003
misrepresentations to induce sales on the front end, they thought
the companies were legitimate and there was no evidence whatso-
ever that they knew Sizer and Mesa were looting most of the
money on the back end.
The government, on the other hand, points us to Simon,
where we recognized Pearlstein as “persuasive” but distinguished
it on the basis that the Simon defendants’ individual misrepresen-
tations were related to the overall scheme charged in the indict-
ment. Simon, 839 F.2d at 1468. Unlike in Pearlstein, the jury’s ver-
dict in Simon was supported by sufficient evidence that the defend-
ants knew about the alleged scheme and conspired to execute it.
Id.Harmonizing the cases cited by the defendants and the gov-
ernment, we can derive the following rule: to prove that a defend-
ant was part of a conspiracy, there must be some evidence that the
defendant knew the objective of the conspiracy charged in the in-
dictment and decided to join it. In this case, there was sufficient
evidence to support a finding that Wheeler and Long knew about
a conspiracy to sell stock by lying to investors; but there was little
to no evidence that Wheeler and Long knew about a plot by Sizer
and Mesa to misappropriate a large percentage of investor funds
for themselves. So the core issue here is: which of those conspira-
cies did the indictment charge?
To make that determination, we start with the language of
the indictment. Count 11 described the purpose of the FCF con-
spiracy as follows: for the defendants to “unlawfully enrich
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 31 of 53
17-15003 Opinion of the Court 31
themselves by misappropriating investor money for their personal
use and benefit” through misrepresentations and failing to disclose
material facts, including “the safety and profitability of Fun Cool
Free stock, and the defendants[’] and their co-conspirators’ exces-
sive commissions and fees.” Count 1 alleged that the Sanomedics
conspiracy had a parallel purpose.
This language is not limited to a higher-level conspiracy by
Sizer and Mesa to pocket investments; it matches the conspiracies
that the government attempted to prove at trial in which salespeo-
ple made misrepresentations and concealed their excessive com-
missions to sell stock. As a result, the government could prove that
the defendants knew about the conspiracy charged in the indict-
ment without proving that they knew what Sizer and Mesa were
up to.
There was sufficient evidence on which the jury could have
concluded that the government did so. One way for the govern-
ment to show that a defendant knew about and joined the charged
conspiracy is “through proof of surrounding circumstances such as
acts committed by the defendant which furthered the purpose of
the conspiracy.” United States v. Gonzalez, 834 F.3d 1206, 1215
(11th Cir. 2016). As detailed above in reference to the substantive
mail fraud counts, there is evidence that Wheeler and Long made
claims they knew were false in order to further the purpose of the
FCF conspiracy. Even if they did not know the extent of the fraud
perpetrated by Sizer and Mesa, the jury could infer from the de-
fendants’ actions that they joined the FCF conspiracy charged in
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 32 of 53
32 Opinion of the Court 17-15003
the indictment. Therefore, sufficient evidence supported
Wheeler’s and Long’s convictions on Count 11.
The same can be said of Wheeler’s involvement in the Sano-
medics conspiracy charged in Count 1. While selling Sanomedics
stock, Wheeler made many of the same misrepresentations he
made while selling FCF stock. There was also testimony that he
concealed from investors that they would be indefinitely restricted
from selling their Sanomedics stock. 5 Therefore, there was evi-
dence to support a finding that Wheeler knew about and joined the
conspiracy to defraud investors in Sanomedics.
Because there was evidence to support the jury’s verdict on
the substantive and conspiracy counts against Wheeler and Long,
we reverse the district court’s judgment of acquittal as to those de-
fendants. We turn next to the convictions of their three co-defend-
ants.
2. Smigrod’s, Sgarro’s, and Topping’s Convic-
tions
Counts 1 and 11 of the indictment charged Smigrod with the
Sanomedics and FCF conspiracies, and Count 9 charged him with
5 Unbeknownst to the investors, they were not buying shares directly from
Sanomedics; they were buying Sizer’s personal shares which were restricted.
Juan Perez Ortega, a salesperson who worked in the Florida phone room, tes-
tified that Wheeler knew about the stock restriction but did not disclose it to
investors, which provides support for the inference that Wheeler knew about
the conspiracy to defraud investors.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 33 of 53
17-15003 Opinion of the Court 33
substantive mail fraud based on a July 2014 sale of Sanomedics
stock to an investor identified as D.M. Sgarro was charged in the
Sanomedics conspiracy in Count 1 and for substantive mail fraud
involving investors identified as G.S. and A.O. in Counts 2 and 10. 6
Notably, she left Sanomedics in 2011; but on her way out, she re-
ferred clients—including G.S. and A.O—to Sizer, who sold them
additional shares. Finally, the indictment charged Topping in both
the Sanomedics and FCF conspiracies and in a slew of substantive
counts. Altogether, he was charged in Counts 1, 2, 3, 6, 7, 8, 9, 10,
11, and 13. We first consider the defendants’ substantive convic-
tions and then turn to the conspiracy convictions.
a. Substantive Counts
Beginning with Smigrod, he says that he lacked any intent
to defraud investors. First, he argues that his misrepresentations
were minor and did not go to the nature of the bargain. Second,
he argues that the government did not prove that he knew the
statements he made were inaccurate. We find, however, that alt-
hough the evidence against Smigrod was not overwhelming, it was
sufficient to support the jury’s guilty verdict. Like Wheeler and
Long, Smigrod hid from investors that he made commissions as
high as twenty percent. There was also testimony from one of Smi-
grod’s co-workers that he knew the Sanomedics stock he sold was
restricted, yet he failed to disclose the restriction to investors.
6 Sgarro was also charged and convicted on Count 1, but she does not appear
to challenge the sufficiency of the evidence supporting that conviction.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 34 of 53
34 Opinion of the Court 17-15003
Based on these facts, it is at least a “reasonable construction of the
evidence” that Smigrod intended to defraud victims by deceiving
them about the value of Sanomedics stock. Capers, 708 F.3d at
1297.
As to Sgarro, she argues that she did not participate in the
stock sales to G.S. and A.O. that are charged in Counts 2 and 10.
Regarding Count 2, Sgarro first sold stock to G.S. in early 2010.
Later, in 2011, G.S. bought additional shares from Sizer which form
the basis for Count 2. Sgarro argues that she cannot be liable for
the 2011 transaction because she was no longer in the organization
and did not participate in that sale. She also stresses that she tried
to dissuade G.S. from buying more Sanomedics stock, pointing to
testimony that she told him he already had enough.
We disagree. As the government explains, there was suffi-
cient evidence that Sgarro aided and abetted the transaction in two
ways, even if she did not personally participate. First, she provided
Sizer with G.S.’s contact information, and there was sufficient evi-
dence to allow the jury to infer that she did so knowing Sizer would
defraud G.S. Second, she told G.S. that if he reported her to the
authorities, she would deny everything. We have held that dis-
couraging a victim from going to the authorities amounts to aiding
and abetting the crime. United States v. Hansen, 262 F.3d 1217,
1236 (11th Cir. 2001) (per curiam).
On Count 10, Sgarro was convicted of defrauding investor
A.O. That investor testified that Sgarro called her and presented
an investment opportunity in Sanomedics stock. Sgarro told A.O.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 35 of 53
17-15003 Opinion of the Court 35
that Sanomedics was going to secure an endorsement deal with Ce-
sar Millan, a popular television personality known as the “dog
whisperer,” and that Sanomedics had recently received two large
orders that would generate over $10,000,000 in revenue. She also
said that Sanomedics was in clinical trials at Yale Medical School
and Miami Children’s Hospital. None of these representations
were true.
A.O. invested $100,000 in Sanomedics stock with Sgarro.
When Sgarro left the operation in early 2012, she referred A.O. to
Sizer, and A.O. continued to invest in Sanomedics with Sizer in the
summer of 2012. Although Sgarro did not personally orchestrate
the 2012 transaction on which Count 10 is based, A.O. testified that
she executed that transaction based on “the viability of the corpo-
ration as told to me by Anita [Sgarro] and Craig Sizer.” Specifically,
A.O. testified that she relied on Sgarro’s representations that Sano-
medics was in clinical trials, that it had high-profile endorsements,
and that it was making millions in profit. While Sgarro argues that
people typically make stock purchase decisions based on currently
available information, we cannot substitute our judgment for that
of the jury, who apparently credited A.O.’s testimony about her
reliance on Sgarro’s earlier representations. Therefore, we reject
Sgarro’s sufficiency-of-the-evidence argument.
Finally, Topping’s substantive convictions. Topping’s pri-
mary argument is that there was no basis on which the jury could
have convicted him of Counts 2, 6, and 10 because there was no
evidence that he was involved in those transactions or that he had
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 36 of 53
36 Opinion of the Court 17-15003
any contact with the victims named in those counts. We rejected
a similar argument in United States v. Munoz, 430 F.3d 1357, 1368–
69 (11th Cir. 2005). There, we held that a defendant can be guilty
of mail fraud even if there is no evidence of his personal interaction
with a particular victim. It is enough to show that the defendant
“participated in a scheme to defraud all buyers.” Id.; see also
United States v. Toney, 598 F.2d 1349, 1355 (5th Cir. 1979) (“It is
well settled in this circuit that so long as one participant in a fraud-
ulent scheme causes a use of the mails in execution of the fraud, all
other knowing participants in the scheme are legally liable for that
use of the mails.”). 7 Because there was evidence that Topping ac-
tively participated in the scheme to defraud at the time of the trans-
actions described in Counts 2, 6, and 10, the government need not
show that he was personally involved with every victim. See
Munoz, 430 F.3d at 1368–69.
More broadly, Topping argues that there was insufficient ev-
idence to support all of his convictions because the government
failed to prove that he made misrepresentations that went to the
nature of the bargain with investors. His argument is that despite
any misstatements he made, investors got the shares of stock they
bargained for. He also argues that the government failed to prove
that he knew any misstatements were false. We are satisfied,
7 We adopted as binding precedent all decisions of the former Fifth Circuit
handed down before October 1, 1981. Bonner v. City of Prichard, 661 F.2d
1206, 1209 (11th Cir. 1981) (en banc).
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 37 of 53
17-15003 Opinion of the Court 37
however, that the record provides sufficient evidence for a reason-
able jury to conclude both that Topping’s representations were es-
sential to the bargain and that Topping knew they were false.
True, Topping’s use of an alias or his claiming to work for Sano-
medics would not establish an intent to defraud. But to highlight
some facts that could establish such intent, there was evidence that
Topping:
• said that Sanomedics was profiting millions of dollars (its an-
nual revenue never actually reached $100,000);
• represented that FCF was “bring[ing] on John Sculley, for-
mer Apple CEO, to facilitate success and growth”; he also
played up connections with other famous people like billion-
aire investor Phillip Frost and the founder of Papa John’s
Pizza, whereas, in reality, none of these people were actively
involved in Sanomedics;
• created the illusion that he was offering investors a special
opportunity to buy “institutional shares,” although there
was nothing special about the shares he was selling; and
• concealed that he made commissions and that the stock he
was selling would be restricted.
And the jury could have drawn the inference that Topping
made these claims knowing they were false. Many of these state-
ments went beyond the information in the written press releases,
and Topping even admitted in an interview with law enforcement
that he misled investors about how he was compensated. This
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 38 of 53
38 Opinion of the Court 17-15003
evidence was sufficient to support Topping’s convictions on the
substantive counts.
b. Conspiracy Counts
Smigrod and Topping also challenge the sufficiency of the
evidence supporting their convictions on Count 1 (the Sanomedics
conspiracy) and Count 11 (the FCF conspiracy). Both claim that
they did not know of the conspiracies to defraud investors—that
they were unwitting pawns in a conspiracy hatched by Sizer and
Mesa. But, as with Wheeler and Long, there was sufficient evi-
dence for the jury to conclude that Smigrod and Topping know-
ingly joined the conspiracies charged in the indictment. Again,
Smigrod’s and Topping’s misrepresentations often went beyond
the information provided to them in scripts or press releases, allow-
ing the inference that they invented falsehoods to further the pur-
pose of the conspiracy. See Gonzalez, 834 F.3d at 1215. And there
was additional evidence that the defendants were not innocent
dupes. For example, Mesa instructed salespeople not to pitch
members of law enforcement, financial professionals, or lawyers,
and there were even signs posted to that effect in the Florida phone
room. Finding that sufficient evidence supported the jury’s ver-
dicts, we affirm the district court’s denial of the motions for judg-
ment of acquittal.
B. Prosecutorial Misconduct
Even if the defendants are not entitled to a judgment of ac-
quittal, we still must consider their arguments that they are entitled
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 39 of 53
17-15003 Opinion of the Court 39
to a new trial. See United States v. Thomas, 86 F.3d 647, 651 (7th
Cir. 1996) (finding that evidence was sufficient to convict the de-
fendants but reversing the convictions and remanding for a new
trial because improper jury instructions did not amount to harm-
less error). We begin with the defendants’ argument that the dis-
trict court should have ordered a new trial because of prosecutorial
misconduct.
Prosecutors have a special role in our justice system. “The
United States Attorney is the representative not of an ordinary
party to a controversy, but of a sovereignty . . . whose interest,
therefore, in a criminal prosecution is not that it shall win a case,
but that justice shall be done.” Berger v. United States, 295 U.S. 78,
88 (1935). So we must carefully review accusations that a criminal
conviction is marred by prosecutorial misconduct. Our two-step
framework for assessing allegations of prosecutorial misconduct is
well-established: “(1) the remarks must be improper, and (2) the
remarks must prejudicially affect the substantial rights of the de-
fendant.” See Eckhardt, 466 F.3d at 947.
We begin with the first prong: whether the prosecutor made
improper remarks. While a prosecutor can attack a defense theory
during closing argument, see United States v. Sosa, 777 F.3d 1279,
1297 (11th Cir. 2015), he is not to misstate the law or tell the jury it
can ignore the law, see Spivey v. Head, 207 F.3d 1263, 1275 (11th
Cir. 2000).
Whether the prosecutor acted improperly here is a close
question. The theory-of-defense instruction explained, crucially,
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 40 of 53
40 Opinion of the Court 17-15003
that there is a “difference between deceiving and defrauding.” It is
cause for concern that the prosecutor told the jury that this instruc-
tion was “not the law.” When considered in context, however, we
cannot say that the prosecutor’s remarks were improper. The dis-
trict judge repeatedly emphasized to the lawyers that the theory-
of-defense instruction was not an instruction about the law and did
not affect the legal elements for mail and wire fraud. When one
prosecutor raised concerns that the proposed wording of the the-
ory of defense instruction was “describing it as the law,” the judge
responded “[n]o, I say up front it is the defendants’ theory of de-
fense.” When one defense lawyer proposed a sentence beginning
“the law makes clear,” the judge responded, “saying the law makes
clear is not probably the best way to caption a paragraph for a the-
ory of defense.” When another complained about removing sev-
eral paragraphs from his proposed instruction, the judge empha-
sized: “I think you have a right to say what your theory is, not a
right to, through the theory, back door the instruction” on intent
to harm. She went on to admonish them: “I don’t want the jury to
think this is part of the actual substantive instruction.” As she ed-
ited the instruction, she underscored that she was “trying to take
out anything that says the law requires or this requires.”
Moreover, that the prosecutor confusingly characterized the
theory-of-defense instruction does not necessarily mean that the
prosecutor acted improperly. One of our precedents, in particular,
underscores this point. In United States v. Chirinos, 112 F.3d 1089(11th Cir. 1997), we held that a prosecutor did not commit
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 41 of 53
17-15003 Opinion of the Court 41
misconduct when he discussed during his opening statement
“highly prejudicial evidence” of a defendant’s unrelated criminal
activity. Id. at 1097. Even though the district court later excluded
that evidence, we did not fault the prosecutor for making the re-
marks. These remarks were “not improper,” we reasoned, because
the prosecutor thought “the district court would admit the 404(b)
evidence at the time he made such statements.” Id. at 1098. The
same is true here: based on the district judge’s statements during
the charge conference, the prosecutor could reasonably have be-
lieved his remarks were proper. And the district judge even agreed
the remarks were proper in overruling the defendants’ first objec-
tion. Accordingly, we find that the prosecutor did not make im-
proper remarks and thus we need not consider whether the com-
ments were prejudicial. See Eckhardt, 466 F.3d at 947.
C. Evidentiary Issues and Right to Unanimous Verdict
We turn next to the defendants’ contentions that the district
court abused its discretion by allowing inadmissible evidence at
trial in several instances, and Topping’s contention that the jury
instructions deprived him of his right to a unanimous jury verdict.
Beginning with the evidentiary issues, Topping argues, first,
that the district court erred by allowing Rubens, a government in-
formant who secretly recorded the Florida phone room, to offer
improper lay opinions. Rubens testified that the Florida phone
room was a “boiler room”—a term used to describe a salesroom
that uses high-pressure selling tactics. Rubens also identified and
defined the roles that were commonly assigned to salespeople in
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 42 of 53
42 Opinion of the Court 17-15003
boiler-room operations. For example, front-end salespeople who
cold-called potential investors were called “fronters.” After a
fronter made a sale, a second salesperson, known as a “loader,”
would follow up and pitch the investor on making additional pur-
chases.
The district court did not abuse its discretion in allowing Ru-
bens’s testimony. Under the rules of evidence, a lay witness can
give opinion testimony that is: “(a) rationally based on the witness’s
perception; (b) helpful to clearly understanding the witness’s testi-
mony or to determining a fact in issue; and (c) not based on scien-
tific, technical, or other specialized knowledge within the scope
of Rule 702.” Fed. R. Evid. 701. Rubens’s testimony met these cri-
teria. He was able to assist the jury by explaining, for example,
some of the jargon used in conversations between Rubens and
Mesa. And Rubens was able to draw on his own experience in the
field to explain to the jury how “boiler rooms” typically functioned,
as well as the various roles that salespeople played in such opera-
tions. Because Rubens’s testimony was based on his own percep-
tions, was helpful to the jury, and was not based on scientific or
technical knowledge, Rubens did not give an improper lay opinion.
See Fed. R. Evid. 701.
Next, Topping argues that the district court allowed inflam-
matory victim impact testimony. To prove mail fraud, the Gov-
ernment does not need to prove that the victims suffered an actual
loss. As a result, Topping argues, the court erred by allowed vic-
tims to testify about the amount of their loss, and—even worse—
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 43 of 53
17-15003 Opinion of the Court 43
the impact of that loss, such as victims struggling to pay for their
child’s surgery or for their grandson’s college. We find, however,
that the testimony at issue came into evidence to illustrate that the
defendants would learn about the victims’ personal lives, gain their
trust, and then use that trust to exploit them. And, in any event,
the district court gave a limiting instruction, stressing that the jury
could not “be influenced in any way by either sympathy for or prej-
udice against the defendant.” As a result, we do not find reversible
error based on the victims’ testimony.
Finally, both Topping and Sgarro argue that the district
court abused its discretion when it allowed the government to im-
properly impeach defense witness Gary Miller on a collateral mat-
ter in order to label Sgarro as a drug dealer. Although this is a close
question, we cannot say that the district court abused its discretion
in this regard. “[E]xtrinsic evidence is not admissible to prove spe-
cific instances of a witness’s conduct in order to attack or support
the witness’s character for truthfulness.” Fed. R. Evid. 608(b).
However, extrinsic evidence can be “offered for other grounds of
impeachment (such as contradiction, prior inconsistent statement,
bias and mental capacity).” Fed. R. Evid. 608(b), advisory commit-
tee’s notes to 2003 amendments. Typically, extrinsic evidence of a
prior inconsistent statement is admissible because it is relevant to
the witness’s character for untruthfulness, but the witness must be
given “an opportunity to explain or deny the statement,” and an
adverse party must be given “an opportunity to examine the wit-
ness about it.” Fed. R. Evid. 613(b).
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 44 of 53
44 Opinion of the Court 17-15003
We have held, however, that the Government cannot begin
a line of questioning that is irrelevant, only to impeach the witness
with a prior inconsistent statement. In United States v. Reed, for
example, a defendant who stood trial for embezzlement and ob-
struction of the mail testified in his own defense. 700 F.2d 638, 643
(11th Cir. 1983). During cross-examination, the prosecution asked
whether the defendant had admitted to investigators that he
smokes marijuana. Id. After the defendant denied making the
statement, the prosecution called the investigator in rebuttal to im-
peach the defendant with a prior inconsistent statement. Id. at 644.
We reversed the defendant’s conviction in Reed because ir-
relevant references to the defendant’s drug use amounted to prej-
udicial error. Id. at 646–47. We explained:
Though the defendant’s answers may have indeed
been false, the issue before us is the propriety of the
prosecutor’s questions and the introduction of the de-
fendant’s possession and use of marijuana as an issue
in the trial; the prosecutor can hardly contend that his
question was intended to highlight a prior incon-
sistent statement when no inconsistent statement had
been uttered until after the prosecutor broached the
marijuana issue.
Id. at 644. Sgarro urges that the same result should follow
here.
Although this case bears some similarity to Reed, the gov-
ernment points out a key distinction. In this case—unlike in
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 45 of 53
17-15003 Opinion of the Court 45
Reed—the prosecution’s initial line of questioning was relevant to
establish that the witness might be biased. If Miller had an illicit
drug-dealing business with Sgarro, he might have been likely to
slant his testimony in her favor.
In that regard, this case is analogous to United States v. Abel,
469 U.S. 45 (1984). There, the prosecution pursued a line of ques-
tioning related to the defense witness and the defendant having
membership in a secret prison gang. When the defense witness
denied that association, the prosecution used extrinsic evidence to
impeach him. The prosecution’s line of questioning was relevant,
the Court held, to establishing that the defense witness might be
biased in the defendant’s favor based on shared membership in the
gang.
Here, the district court, in its discretion, found that the pros-
ecution’s inquiry was relevant to illustrate Miller’s bias, rather than
simply to portray Sgarro as a drug dealer. In light of the Supreme
Court’s decision in Abel, the district court did not abuse its discre-
tion in admitting this evidence.
Having addressed the defendants’ contentions that the dis-
trict court’s evidentiary rulings were an abuse of discretion, we
turn to Topping’s argument that the district court erred in its jury
instructions. Topping argues that the jury instructions were erro-
neous because they charged “overlapping,” rather than separate
conspiracies. Because the conspiracies were presented to the jury
as overlapping, the argument goes, the jury could convict as long
as each juror believed Topping was guilty as to one conspiracy.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 46 of 53
46 Opinion of the Court 17-15003
Such a result would run afoul of the principle that a jury cannot
convict without a unanimous finding of guilt as to a single conspir-
acy. See Richardson v. United States, 526 U.S. 813 (1999).
After reviewing the jury instructions at issue here, we reject
Topping’s argument. As the government points out, the instruc-
tions conveyed that conspiracies were “overlapping” in the sense
that the participants overlapped. The instructions read: “As you
can see, the Indictment alleges two overlapping conspiracies.
Please note that Defendant Long is not charged in Count 1, which
is the first conspiracy count, and Defendant Sgarro is not charged
in Count 11, the other conspiracy count.”
Moreover, the jury instructions directed the jury not to
lump together separate charges. In relevant part, the instructions
provided that:
Each count of the indictment charges a separate
crime against one or more of the defendants. You
must consider each crime and the evidence relating
to it separately. And you must consider the case of
each defendant separately and individually. If you
find a defendant guilty of one crime, that must not
affect your verdict for any other crime or any other
defendant.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 47 of 53
17-15003 Opinion of the Court 47
Because the jury instructions explained that each crime was
to be considered separately, they did not deprive Topping (or any
defendant) of the right to a unanimous jury verdict.
D. Sentencing
Having determined that the defendants’ convictions should
be affirmed, we turn to a number of sentencing-related issues
raised by the defendants. Sgarro and Topping each argue that the
court improperly applied sentencing enhancements. As to Sgarro,
she argues that the court should not have applied the sophisticated-
means enhancement because there was nothing intricate or com-
plex about the conspiracy. The Sentencing Guidelines include a
two-level enhancement for an offense that involved sophisticated
means. U.S.S.G. § 2B1.1(b)(10)(C). An offense is sophisticated if it
involves “especially complex or especially intricate offense conduct
pertaining to the execution or concealment of an offense.” Id. §
2B1.1, application notes 9(B). We have held that a sophisticated-
means enhancement can be applied when some—but not all—as-
pects of a scheme are sophisticated. See United States v. Ghertler,
605 F.3d 1256, 1267–68 (11th Cir. 2010). Here, parts of the Sano-
medics scheme were sophisticated. For example, the evidence
showed that Sgarro paid her salespeople through a company not
associated with Sanomedics: Ladybug Ventures. Sgarro also had
her salespeople research target investors’ financial assets, some-
times rewarding salespeople for finding investors with IRA ac-
counts. Based on this evidence, the district court’s application of
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 48 of 53
48 Opinion of the Court 17-15003
the sophisticated-means enhancement was not clearly erroneous.
See Monzo, 852 F.3d at 1348.
As to Topping, he argues that the court had no basis to im-
pose a managerial-role sentencing enhancement. The Sentencing
Guidelines include a three-level enhancement for acting as “a man-
ager or supervisor.” Id. § 3B1.1(b). Even if a defendant could not
force others to engage in criminal conduct, he can still be sentenced
as a manager or supervisor if he hires and trains others to partici-
pate in the criminal operation. United States v. Matthews, 168 F.3d
1234, 1249–50 (11th Cir. 1999). Here, there was evidence that Top-
ping led sales meetings and trained new salespeople, and he was
the only one in the Florida operation with an office, other than
Mesa (the director of the Florida operation). Accordingly, the dis-
trict court did not clearly err in applying a sentencing enhancement
for Topping’s managerial role. See Monzo, 852 F.3d at 1348.
Sgarro and Topping also contest the amount of loss for
which they were held responsible. Sgarro argues that, because she
worked only in the California operation and because she left the
conspiracy in early 2011, the district court erred in attributing to
her a $22.3 million loss, which represented victims’ losses from
both the Florida and California operations. Similarly, Topping ar-
gues that the evidence does not support the $22.5 million loss at-
tributed to him. He argues that the district court did not even at-
tempt to make an individualized finding as to the extent of his cul-
pability.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 49 of 53
17-15003 Opinion of the Court 49
We do not find these arguments persuasive. The district
court need only make a reasonable estimate of the loss. United
States v. Campbell, 765 F.3d 1291, 1301 (11th Cir. 2014). And as the
government notes, a defendant is liable for the total loss amount of
the conspiracy when she is actively involved in furthering the con-
spiracy’s overall objective. United States v. McCrimmon, 362 F.3d
725, 731–33 (11th Cir. 2004). Here, there was evidence that Sgarro
knew the overall scheme and actively participated in furthering it.
The following two facts, among others, support that conclusion.
First, Sgarro was in close contact with Mesa and the Miami phone
room, often exchanging information about sales and investor fi-
nancial information. Second, she introduced investors to Sizer,
who oversaw both the Florida and California operations. There-
fore, the district court did not err in holding Sgarro accountable for
losses caused by the Florida and California phone rooms. Likewise,
because Topping actively participated in the scheme to defraud, he
is liable for the amount of loss to all the victims who were de-
frauded through the scheme. See id.In conclusion, we affirm the convictions and sentences of
Smigrod, Sgarro, and Topping. As to Wheeler and Long, we re-
verse their judgments of acquittal and remand to the district court
for proceedings consistent with this opinion.
AFFIRMED IN PART; VACATED AND REMANDED IN
PART.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 50 of 53
50 Opinion of the Court 17-15003
WILSON, Circuit Judge, joined by LAGOA, Circuit Judge, con-
curring:
I concur in the court’s judgment. I write separately to ex-
press my concern with the conduct of the prosecution during clos-
ing argument and throughout trial in this case.
To address what transpired in closing argument, the theory-
of-defense instruction drafted by the district court was quite unu-
sual. It framed statements of law as the defendants’ “con-
ten[tions].” And, as the court’s opinion explains, the district judge
told the parties during a charge conference that the instruction in
question was “a theory, not a legal instruction.” Perhaps the pros-
ecutor still should have known better than to argue that an instruc-
tion from the court was “not the law.” It is well-settled that district
courts can instruct the jury on a theory of defense only if it is based
on a correct statement of law. See Chirinos, 112 F.3d at 1101 (“The
district court should instruct the jury on the defendant’s defense
theory if the theory has a foundation in evidence and legal sup-
port.”). As the district court correctly told the parties, the prosecu-
tion should have focused its argument on whether the theory of
defense “match[ed] up to the evidence”—not whether the instruc-
tion accurately stated the law. Still, the district court’s commen-
tary on the instruction, as well as the manner in which the instruc-
tion was phrased, gave mixed messages. With that in mind, I can-
not say that the prosecution’s closing argument amounted to prej-
udicial misconduct under our precedents.
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 51 of 53
17-15003 Opinion of the Court 51
More broadly, however, I feel compelled to address the
prosecution’s conduct and the tactics it employed throughout the
trial. The prosecution fell short of the high level of professionalism
that we expect prosecutors to embody, even if their actions did not
rise to the level of misconduct. An unfortunate but notable feature
of this trial was that the district court exerted considerable time and
energy corralling the prosecution’s often wayward tactics. Starting
in voir dire and continuing through the testimony of multiple wit-
nesses, the prosecution frequently appeared to ignore the court’s
rulings when it disagreed with them, eliciting remarks from the
court including:
• “Counsel, you know that’s improper.”
• “[W]hy would you go there?”
• “We went over this. . . . I may be wrong, but I ruled. Let’s
go.”
• “We’ve had this conversation through other witnesses.
Counsel, move on.”
• “We did this yesterday. I’m not revisiting. Anybody [who]
wants to go back to the transcript, can.”
• “I don’t know . . . how many other languages to speak to
you. . . . I said how to proceed. Proceed that way.”
• “What you have to do is to remember we have had some
rules in this trial and somehow they seem to have been for-
gotten.”
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 52 of 53
52 Opinion of the Court 17-15003
The court’s admonitions, it seems, had little effect. After a
particularly volatile exchange between a prosecutor and defense
witness Miller, in which the prosecutor admitted that he lost his
composure, the district court warned that he was “close” to causing
a mistrial. Afterward, outside the presence of the jury, she admon-
ished the prosecutor, telling him: “You’re better than having to go
to the lowest part of your anger in order to examine this witness. .
. . [Y]ou’re an experienced cross-examiner. You didn’t have to do
that. I would have expected that of someone of less experience
than you.” The district court lamented that things “got very messy
and uncontrolled.”
Certainly, some missteps are to be expected over the course
of a long, contentious trial. And to be sure, the court felt compelled
on occasion to correct the conduct of the defense lawyers, as well
as the prosecution. A review of the transcript, however, leaves no
doubt that the prosecution’s professionalism and demeanor was
particularly lacking. The district court, after having had time to
reflect, singled out one prosecutor’s conduct at trial as “disturbing”
and recounted multiple instances in which he came “so close” to
causing a mistrial.
Prosecutors must hold themselves to a higher standard. As
they carry out their duty to seek justice, they must strive to conduct
themselves with the utmost professionalism, “even when the ethi-
cal rules and constitutional requirements do not bar the behavior”
in question. See Charles R. Wilson, “That Justice Shall Be Done”—
Constitutional Requirements, Ethical Rules, and the Professional
USCA11 Case: 17-15003 Date Filed: 10/21/2021 Page: 53 of 53
17-15003 Opinion of the Court 53
Ideal of Federal Prosecution, 36 N. Ill. U. L. Rev. 111, 135 (2015).
Although the prosecution’s actions in this case did not amount to
misconduct under our precedents and on the unique facts pre-
sented here, I expect far better from prosecutors in future cases.