United States v. Adam Lacerda ( 2020 )

PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
________________
No. 15-2812
________________
UNITED STATES OF AMERICA
v.
ADAM LACERDA a/k/a Robert Klein,
Appellant
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No. 15-4023
________________
UNITED STATES OF AMERICA
v.
GENEVIEVE MANZONI,
Appellant
________________
No. 16-2220
________________
UNITED STATES OF AMERICA
v.
IAN RESNICK,
Appellant
________________
On Appeal from the United States District Court
for the District of New Jersey
(D.N.J. Nos. 1-12-cr-00303-001, 1-12-cr-00303-010, and
1-12-cr-00303-003)
District Judge: Honorable Noel L. Hillman
________________
Submitted Under Third Circuit L.A.R. 34.1(a)
March 11, 2019
Before: McKEE, PORTER, and ROTH, Circuit Judges
(Filed: May 5, 2020)
________________
Mark E. Cedrone
Jesse D. Abrams-Morley
Aubrey C. Emrich
CEDRONE & MANCANO, LLC
123 South Broad Street, Suite 810
Philadelphia, PA 19109
Counsel for Appellant Adam Lacerda
Robert L. Tarver, Jr.
LAW OFFICES OF ROBERT L. TARVER, JR.
66 South Main Street
Toms River, NJ 08757
Counsel for Appellant Genevieve Manzoni
Michael E. Riley
LAW OFFICES OF RILEY AND RILEY
2 Eves Drive, Suite 109
Marlton, NJ 08053
Counsel for Appellant Ian Resnick
Craig C. Carpenito
Mark E. Coyne
Deborah Prisinzano Mikkelsen
Office of United States Attorney
970 Broad Street, Room 700
Newark, NJ 07102
Counsel for Appellee
2
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OPINION OF THE COURT
________________
PORTER, Circuit Judge.
The Vacation Ownership Group (“VOG”) billed itself
as a sort of advocacy group helping victims of timeshare fraud
get out of their timeshare debts. After a lengthy and complex
trial, a jury determined that VOG had in fact defrauded its
customers, and that Adam Lacerda, Ian Resnick, and
Genevieve Manzoni were each knowing participants in that
fraud. In this consolidated appeal, they now challenge their
judgments of conviction, raising several claims of error. For
the reasons discussed below, we will affirm their respective
convictions and sentences.
I. Background
A. VOG’s Fraudulent Activity
A timeshare is a form of shared property ownership in
which multiple people own the rights to use a specific vacation
or resort property. These properties are often units in a resort
condominium, in which each timeshare owner has an allotted
period of time to use the property. When one buys a timeshare,
he typically makes a down payment on the property and
finances the balance of the purchase price. These loans are
commonly referred to as “mortgages” in the timeshare
industry. In addition to these upfront costs, timeshare owners
are also required to pay annual maintenance fees. It is not
unusual for timeshare owners to fall prey to high-pressure sales
tactics and commit to spending more money than they can
comfortably afford. Later, they may seek to settle these debts
or cancel their timeshares.
In 2009, while working for Wyndham Vacation Resorts,
Inc. (a timeshare sales company), Adam Lacerda and his wife,
Ashley Lacerda, founded VOG. VOG marketed itself as a
timeshare consulting company and claimed that it could help
customers cancel, purchase, or upgrade their timeshares.
3
Lacerda was the president and chief executive officer of VOG,
and his wife was the chief operating officer. Together, they
exclusively controlled VOG’s bank accounts and post office
box.
Lacerda created phone scripts for VOG’s sales
representatives to use when speaking with timeshare owners.
One of these scripts was VOG’s “bank settlement” pitch. This
sales pitch was riddled with misrepresentations. Following this
script, the VOG representatives used personal information
compiled by VOG in “customer lead sheets” to make
unsolicited calls to unsuspecting timeshare owners. The
representatives said they were calling on behalf of a property
owners’ association to follow up on the owner’s recent
complaints. This was not true. The representatives also claimed
they were working with the bank that held the loan for the
owner’s timeshare mortgage. This was also not true. They then
promised to review the owner’s account—which they could
not do because they had no access to that account—and then to
call the owner back.
During a follow-up call, VOG representatives offered to
settle the timeshare owner’s debt at a fraction of the remaining
balance, for a negotiated fee. Later, during a closing call, the
representatives had the timeshare owner electronically sign
VOG’s contract and pay its fee. The representatives then
promised that the “mortgage would be paid off in full” and the
timeshare owner would receive a “deed free and clear.” But
none of that happened. Instead, VOG just pocketed the money.
Lacerda also trained his VOG employees to use a
fraudulent phone script for a timeshare “cancellation” sales
pitch. Again, VOG representatives made unsolicited calls to
timeshare owners and falsely told them that VOG had received
their complaints, that VOG would do all the necessary work to
cancel the owners’ timeshares, and that cancellation would not
damage the customers’ credit ratings.
But VOG did not work to cancel the owners’
timeshares. Instead, after receiving the timeshare owners’
money, VOG sent them an eight-step process for cancelling the
timeshares themselves and told them to stop making their loan
payments. Eventually the timeshare owners received default
4
notices from the timeshare developers. When the owners
complained to VOG, VOG instructed them to allow the
developers to foreclose. Typically, this would lead to a
nonjudicial foreclosure proceeding, which is common in the
industry. This proceeding, Lacerda knew, would result in the
cancellation of the owners’ timeshare debt, but at the cost of
the timeshare deed, any equity the owners had, and, of course,
the owners’ credit ratings.
VOG employed additional misrepresentations: Lacerda
impersonated bank officials on calls, altering his voice and
using a spoofing device to alter his phone number. And VOG’s
website falsely displayed the Better Business Bureau seal,
advertising itself as an A+ rated business, and claimed to be a
member of the American Resort Development Association.
Not even the names used at VOG were true. Under
Lacerda’s direction, VOG representatives used false names
while interacting with potential customers. These false names
allowed Lacerda and other former Wyndham employees to
violate their non-compete agreements and hide their identity
from former clients at Wyndham. This was important because
VOG’s customer lead sheets were comprised almost
exclusively of Wyndham timeshare owners.
While employed by Wyndham, Ian Resnick sent
customer lead sheets to VOG and received a kickback for every
resulting sale. In August 2010, Resnick left Wyndham to join
VOG full time. Using the bank settlement and timeshare
cancellation scripts, Resnick defrauded several customers.
Recognizing Resnick’s talents, Lacerda promoted him to
Senior Contract Analyst.
Genevieve Manzoni, another Wyndham-alumna, joined
VOG in October 2010. As a VOG representative, Manzoni
showed great initiative, inventing her own “settlement”
numbers on the fly. She, too, assumed a management role,
overseeing other VOG sales representatives.
In November 2010, the FBI raided VOG’s offices and
the Lacerdas’ home. Several VOG representatives left the
company following the raid, including Resnick. So Lacerda
convened an office-wide meeting where his lawyers, including
5
Marc Neff, assured VOG staff that everything was okay. They
told the employees that only Lacerda was under investigation,
and that Neff had reviewed the sales scripts and verified that
everything was legal. VOG abandoned the bank settlement
pitch and revised the timeshare cancellation pitch to remove
any references to working with the banks, while leaving many
other misrepresentations in place. With these assurances and
changes, many of VOG’s representatives, including Resnick,
returned and VOG resumed and expanded its operations.
Resnick continued receiving promotions, working as
VOG’s Director of Training, then Director of Training and
Compliance, and then Vice President of Sales and Compliance.
While receiving compensation at VOG, Resnick and Manzoni
also obtained unemployment benefits from New Jersey.
B. Trial of VOG Defendants
In April 2012, Lacerda, Resnick, Manzoni, and several
other VOG employees were arrested after being charged with
various counts of mail and wire fraud. VOG then changed its
name to VO Financial and continued operations, still using the
same misrepresentation-riddled sales pitches. Later, a
superseding indictment was filed charging Lacerda, Resnick,
Manzoni, and fifteen other VOG employees with conspiracy to
commit mail and wire fraud. Lacerda was also charged with
nine counts of mail fraud and three counts of wire fraud arising
from his VOG scheme, and a final count of mail fraud for
wrongfully receiving unemployment benefits while he was
employed and receiving compensation at VOG. 1 Resnick was
charged with two counts of mail fraud and three of wire fraud
for his work at VOG, and another count of mail fraud for his
unemployment fraud. And Manzoni was charged with one
count of wire fraud for her work at VOG and a separate count
of wire fraud for, allegedly, wrongfully receiving
unemployment benefits. Other VOG employees received
similar charges.
1
Lacerda, together with his wife, was also charged with
conspiracy to commit money laundering and four counts of
money laundering, but these were dismissed by order of the
District Court as a matter of law.
6
Most of the VOG defendants negotiated plea
agreements with the government. But five defendants—Adam
and Ashley Lacerda, Resnick, Manzoni, and Joseph DiVenti—
took their cases to trial. Relevant to this appeal, about four and
a half months before trial, the District Court disqualified
Lacerda’s then-attorney, Neff, as a potential witness and
denied replacement counsel’s requested continuance. It also
denied Manzoni’s motion to sever her VOG-related fraud
charges from her unemployment-related fraud charges.
The government’s first witness at trial was FBI Special
Agent John Mesisca, an experienced agent in wire and mail
fraud investigations and the lead investigator in the case.
Mesisca was allowed, over appellants’ objections, to provide
an extensive overview of his investigation. During trial, again
over appellants’ objections, the District Court also excluded
certain hearsay evidence and allowed other evidence for
impeachment purposes.
The jury returned guilty verdicts on all counts related to
Lacerda. The District Court sentenced him to 324 months
imprisonment with three years of supervised release, and it
ordered him to pay restitution of $2,679,656.09. The jury also
found Resnick guilty on all counts related to him. The District
Court sentenced him to 216 months imprisonment with three
years of supervised release and ordered him to pay restitution
of $2,735,142.99. While the jury found Manzoni guilty of both
the conspiracy charge and wire fraud in relation to her work at
VOG, it acquitted her on the charge of unemployment fraud.
The District Court entered judgment against Manzoni on the
conspiracy and mail fraud charges, sentenced her to 42 months
imprisonment with three years of supervised release, and
ordered her to pay restitution of $105,422.2 The District Court
also ordered the forfeiture of all of VOG’s gross proceeds.
This appeal follows. The District Court had jurisdiction
over the several crimes charged in this case under 18 U.S.C.
§ 3231. We have jurisdiction over appeals from final
judgments and orders under 28 U.S.C. § 1291.
2
The jury also found Ashley Lacerda guilty on all
remaining counts but acquitted Joseph DiVenti.
7
II. Overview Testimony
A. Proper Overview Testimony Is Admissible
Special Agent Mesisca’s testimony, including both
cross and redirect examination, would extend into the third day
of trial. On appeal, Lacerda, Resnick, and Manzoni each take
issue with Mesisca’s testimony, arguing that it constituted
impermissible overview testimony. We have never addressed
the permissible scope and limits of overview testimony in a
precedential opinion.
Our sister circuits, however, have reviewed overview
testimony. They have analogized it to summary testimony. See,
e.g., United States v. Moore, 651 F.3d 30, 55–56 (D.C. Cir.
2011). The main difference between summary and overview
testimony is that summary testimony comes at the end of trial
and overview at the beginning, but both try to connect the dots
and convey the big picture to the jury in complex prosecutions.
United States v. Banks, 884 F.3d 998, 1023 (10th Cir. 2018).
Summary evidence may be safer because the evidence
that the officer is connecting has already been heard by the
jury. See Moore, 651 F.3d at 56 (citing United States v. Lemire,
720 F.2d 1327, 1349, n.33 (D.C. Cir. 1983)). Because
witnesses can change their stories and objections may be
sustained, some of the testimony relied on during the initial
overview may never materialize at trial. United States v. Casas,
356 F.3d 104, 119–20 (1st Cir. 2004).
Vouching is also a problem with overview testimony.
See Moore, 651 F.3d at 56–57. Under Federal Rule of Evidence
608(a), a party can only bolster the credibility of a witness after
that witness’s credibility has been attacked. Because overview
testimony is the first testimony offered, no witness’s credibility
has yet been attacked. Vouching for a witness who has not yet
testified would, therefore, be inappropriate.
Another serious problem with overview testimony is
that it sometimes relies on anticipated witnesses. Thus, it may
violate confrontation rights. Testimonial statements cannot be
offered against a defendant without the opportunity for cross
examination. Crawford v. Washington, 541 U.S. 36 (2004). If
overview testimony previews the answers of an anticipated
8
witness, such a violation is not easily cured if the expected
witness later fails to testify.
The D.C. Circuit has explained:
Because a witness presenting an overview of the
government’s case-in-chief runs the serious risk
of permitting the government to impermissibly
“paint a picture of guilt before the evidence has
been introduced,” and may never be introduced,
we join the circuits that have addressed the issue
in condemning the practice.
Moore, 651 F.3d at 60 (citations omitted).
The D.C. Circuit concluded that the government could
call as its first witness a law enforcement officer, who is either
familiar with the investigation or was personally involved, to
explain how the investigation began, what law enforcement
entities were involved, and what techniques were used. Id. at
60–61. However, the overview witness could not opine on the
ultimate issues of guilt, anticipate evidence that the
government hoped to introduce, or express an opinion about
the strength of that evidence or the credibility of any potential
witnesses. Id. at 61; see also United States v. Rosado-Perez,
605 F.3d 48, 55 (1st Cir. 2010) (cautioning, before government
has presented supporting evidence, against presenting an
overview of criminal investigation in which witness did not
participate); United States v. Brooks, 736 F.3d 921, 930 (10th
Cir. 2013) (allowing overview based on personal knowledge,
not on hearsay nor on an opinion of defendant’s guilt); but see
United States v. Khan, 794 F.3d 1288, 1300 (11th Cir. 2015)
(overview proper where officer had personal knowledge of
evidence due to officer’s role as lead investigator and his
review of evidence).
We join our sister circuits and now hold that overview
testimony that opines on ultimate issues of guilt, makes
assertions of fact outside of the officer’s personal knowledge,
or delves into aspects of the investigation in which he did not
participate is inadmissible. But an officer who is familiar with
an investigation or was personally involved may tell the story
of that investigation—how the investigation began, who was
9
involved, and what techniques were used. In addition, with
proper foundation, he may offer lay opinion testimony and
testify about matters within his personal knowledge.
B. Summary of Special Agent Mesisca’s
Overview Testimony
Having determined the applicable rule, we now return
to the appellants’ objections to Special Agent Mesisca’s
overview testimony. Evidentiary objections are generally
reviewed for an abuse of discretion. United States v. Georgiou,
777 F.3d 125, 143 (3d Cir. 2015). This standard applies to the
admission of overview testimony. See Rosado-Perez, 605 F.3d
at 54 (citing Hall, 434 F.3d 42, 56–57 (1st Cir. 2006)).
However, although district courts are “ordinarily afforded
broad discretion to determine the manner in which evidence
will be received,” in light of the pervasive risks of unfair
prejudice, overview testimony requires closer review. Moore,
651 F.3d at 58. Nevertheless, even if we find error in the
admission of overview testimony, we can still affirm if the
error was harmless. Rosado-Perez, 605 F.3d at 54.
Applying our holding here, the District Court did not
commit reversible error in admitting Mesisca’s testimony.
Mesisca testified about his background, experience, and
qualifications as the lead investigator in this case. He explained
that the FBI had received a complaint about VOG from a
timeshare developer, Flagship. Following a meeting with
representatives of that company, Mesisca opened an
investigation into VOG. He explained how he had subpoenaed
VOG’s bank records and explained why certain checks were
significant to his investigation.
Mesisca interviewed potential victims, including people
identified by Flagship and others whose names appeared on the
checks. He also interviewed former VOG employees and
conducted several undercover phone calls to obtain evidence
from VOG. With this evidence, he applied for and obtained
search warrants for VOG’s headquarters and the Lacerdas’
personal residence.
The evidence, collected from Mesisca’s search,
included purchase agreements, settlement and cancelation
10
contracts, emails and complaints from concerned victims,
customer lead sheets, client information forms, and phone
scripts used at VOG. His testimony provided the foundation
for admitting this evidence as exhibits, and then, as with the
bank records, he explained why the evidence was significant to
his investigation.
Mesisca testified that both Lacerda and his wife had
control of VOG’s account. While the account received many
deposits, no money from the account was used to pay off any
timeshare debts. Instead, the Lacerdas used the money to buy
a dog, a swimming pool, and similar things.
Mesisca learned that some former Wyndham customers
may have been victimized by VOG. One victim had received a
phone call from “Robert Klein” representing VOG. Mesisca
subpoenaed the caller’s phone records and discovered that the
phone number was used by VOG, after incoming calls were
forwarded to a local number in New Jersey. He also learned
that “Robert Klein” was an alias for Lacerda.
At the trial, Mesisca discussed the evidence he obtained
through execution of the search warrant at VOG’s
headquarters, laying the foundation for the admission of
exhibits and explaining their importance to the investigation.
He further explained the sales pitches used by VOG, based on
the notes, emails, and phone scripts found at the office during
the search, and illustrated many of the misrepresentations VOG
representatives had made to victims.
Mesisca obtained press releases issued by VOG and
visited its website to collect more information and evidence.
His testimony provided the foundation to enter this evidence as
exhibits at trial. He also explained that, during his
investigation, he met with informants who shared with him a
video recording of a VOG employee training session. His
testimony provided the foundation for entering this video
recording into evidence. He was able to show, from his
investigation, that Manzoni was working at and receiving
income from VOG in October 2010, and Resnick was
receiving income from VOG while collecting unemployment
benefits in September and October 2010.
11
During the execution of the search warrant, Mesisca
interviewed Lacerda. Lacerda advised him that he was the
president and CEO of VOG and, contrary to the company’s
sales pitches, that VOG was not associated with any bank, that
it had no ability to pay off anyone’s mortgage or loan, and that
it did not settle anyone’s debts. Lacerda acknowledged that his
sales force used aliases but claimed that was only to induce
outsiders to believe VOG was larger than it really was. Lacerda
admitted that he used the VOG business account for personal
expenses but claimed that he took only about $30,000.
Mesisca’s investigation, showed that number was closer to
$600,000. Lacerda admitted receiving unemployment benefits
but claimed he had repaid those. Finally, Mesisca noted that, at
the end of the interview, Lacerda refused to sign a statement
that he had been truthful during the interview.
Mesisca also interviewed Resnick who recounted that
he worked as VOG’s premier closer: when other employees
failed to complete a deal with a client, the information was sent
to him to close it. A couple of weeks later, Mesisca again met
with Resnick. During that second interview, Resnick
acknowledged that he, too, had been a former Wyndham
employee and that he took internal lead sheets from Wyndham
and used them at VOG to call potential clients. Resnick
admitted that he had collected unemployment benefits while
working at VOG but claimed that he planned to repay the
money.
Mesisca interviewed Manzoni on three occasions. She
admitted that VOG representatives told potential clients that
the representatives worked with banks—it was part of the
script they followed. During her August interview, she told
Mesisca that, disillusioned with VOG, she had quit.
We have set out Mesisca’s direct examination testimony
to show that it was proper overview. It was limited to an
account of his investigation, his personal observations, and his
beliefs of what the evidence showed based on what he saw and
heard and did. Also important is the testimony Mesisca did not
offer. Because he was not directly involved in the execution of
the warrant at the Lacerdas’ home, Mesisca did not tell the jury
about that portion of the investigation. He only provided the
foundation to admit evidence found at the Lacerdas’ house that
12
he had personally reviewed, and then related that evidence to
bank records he had previously obtained While he noted that
each of the defendants had been interviewed when the search
warrant was executed at VOG, he did not discuss the
statements made that day by Ashley Lacerda, DiVenti, or
Manzoni because he did not personally conduct those
interviews.
C. Special Agent Mesisca’s Overview Testimony
Was Admissible
On appeal, Lacerda, Resnick, and Manzoni each
highlight the length of Special Agent Mesisca’s testimony, as
though that alone proves he gave impermissible overview
testimony. Not so. This was a complex case in which, as lead
investigator, he was directly involved in almost every step of
the investigation.
Lacerda and Manzoni each further assert that Mesisca
offered conclusory statements of their guilt by referring to
persons who the government alleged were defrauded by VOG
as “victims.” The appellants have cited no authority, and we
are aware of none, prohibiting government witnesses from
referring to persons as “victims” who are alleged to be victims
in the indictment. That there had been victims was not even
disputed—it was highlighted by Lacerda and Resnick during
their opening statements. Assertions to the contrary
notwithstanding, whether there were victims was not at issue
in this case. The issue was whether these defendants had
defrauded the victims, or otherwise knowingly participated in
the fraud occurring at VOG. The jury understood this and,
finding insufficient evidence of guilt for one of the defendants,
acquitted DiVenti.
Lacerda also asserts that Mesisca gave conclusory
testimony, without foundation. For example, he testified that
“Robert Klein” was Lacerda’s alias. This issue was not
preserved by any objection, see Fed. R. Crim. Pro. 51(b), and,
having not attempted to show plain error, Lacerda is not
entitled to review of this unpreserved issue on appeal. See
13
United States v. Olano, 507 U.S. 725, 732 (1993).3 But even
had this issue been preserved, there was in fact foundation for
Mesisca’s testimony: he testified that, during their execution of
the search warrant at VOG headquarters, agents had found a
list of names with aliases at the receptionist’s desk. “Robert
Klein” was listed as the alias for Lacerda, and Mesisca did not
find evidence that anyone else ever used that alias.
We have reviewed the appellants’ other allegations of
improper overview, e.g., the reason for having duplicate copies
of client information sheets, whether victims were told about
non-judicial foreclosure process, whether Lacerda “freaked
out” when he saw one of VOG’s representatives using the
“bank pitch” in an email to a victim. etc. After careful review
and consideration of the permissible limits of overview as set
out above, we find no abuse of discretion in the admission of
Mesisca’s testimony.
In sum, the government may call as its first witness an
officer who is familiar with, or was personally involved in, the
criminal investigation, and that officer may testify about all
matters within his personal knowledge from the investigation.
Special Agent Mesisca’s testimony was largely confined to
telling the story of his investigation: how it began, the steps he
took, the evidence he uncovered, and the interviews with
defendants he conducted. The District Court did not abuse its
discretion by allowing this testimony.
III. Objections Raised by Lacerda
Lacerda raises several additional issues on appeal. He
asserts that the District Court (1) abused its discretion when it
disqualified his counsel, Marc Neff, based on Neff’s conflict
of interest; (2) abused its discretion when it denied replacement
counsel’s motion for a continuance; (3) abused its discretion
by excluding from evidence an email sent by Lacerda to
VOG’s former CFO, Jeff Sawyer; (4) abused its sentencing
3
Lacerda takes issue with additional portions of
Mesisca’s testimony unpreserved by timely objection but has
not attempted to show plain error entitling him to review of
these unpreserved issues. So we decline to address these
unpreserved issues in this opinion.
14
discretion; and (5) erred by ordering the forfeiture of all VOG’s
gross proceeds. We will address each issue in turn.
A. Attorney Neff Was Properly Disqualified
Lacerda argues that the District Court arbitrarily
disqualified his counsel of choice or at least abused its
discretion by disqualifying Neff. When a defendant challenges
the District Court’s decision to disqualify his counsel of
choice, we apply a bifurcated standard of review: first, we
exercise plenary review when determining whether the District
Court’s decision was arbitrary, and then, if not arbitrary, we
review the decision for an abuse of discretion. United States v.
Stewart, 185 F.3d 112, 120 (3d Cir. 1999). Here, we find that
the District Court’s decision was neither arbitrary nor an abuse
of discretion, so we will affirm.
The Sixth Amendment to the United States Constitution
guarantees the right of counsel to every criminal defendant.
That guarantee has generally been understood to encompass a
right to the counsel of choice. Powell v. Alabama, 287 U.S. 45,
53 (1932). But the right to counsel of choice is not absolute.
Wheat v. United States, 486 U.S. 153 (1988). “The essential
aim of the [Sixth] Amendment is to guarantee an effective
advocate for each criminal defendant rather than to ensure that
a defendant will inexorably be represented by the lawyer whom
he prefers.” Id. at 159 (internal citations omitted). Before
disqualifying a defendant’s counsel of choice, the trial court
must balance that defendant’s right to his counsel of choice
against the fair and proper administration of justice. United
States v. Voigt, 89 F.3d 1050, 1074 (3d Cir. 1996). When
“considerations of judicial administration supervene,” such as
when an attorney has a serious potential conflict of interest, the
presumption in favor of counsel of choice is rebutted and the
right must give way. Id. at 1074–75 (citing Fuller v. Diesslin,
868 F.2d 604, 607 n.3 (3d Cir. 1989)).
Here, the District Court weighed Lacerda’s right to
counsel of choice against Neff’s serious actual and potential
conflicts of interest and, ultimately, determined those conflicts
could neither be waived nor cured by anything short of
disqualification. That conclusion was neither arbitrary nor an
abuse of discretion.
15
After the FBI raid on VOG in November 2010, Lacerda
retained Neff as his counsel. The following month, Neff met
with VOG employees to ease any concerns they had, assuring
them that (1) only the Lacerdas were under investigation by the
FBI and (2) the post-raid revised phone scripts were lawful.
VOG continued operations using the phone scripts whose
legality had been vouched for by Neff. Contrary to Neff’s
representations, 18 VOG employees, including the Lacerdas,
were eventually indicted in this criminal case based in part on
their use of the phone scripts. In proffers to the government,
several of those defendants told of the December meeting with
Neff.
In United States v. Merlino, 349 F.3d 144, 151 (3d Cir.
2003), we recognized that “[a]n attorney who faces criminal or
disciplinary charges for his or her actions in a case will not be
able to pursue the client’s interests free from concern for his or
her own.” We also recognized the potential conflicts that arise
when counsel realistically could be called as a witness, as “it is
often impermissible for an attorney to be both an advocate and
a witness.” Id. at 152. And we noted “that disqualification may
also be appropriate where it is based solely on a lawyer’s
personal knowledge of events likely to be presented at trial,
even if the lawyer is unlikely to be called as a witness.” Id.
(citing United States v. Locascio, 6 F.3d 924, 933 (2d Cir.
1993)). Each consideration applies here and was central to the
District Court’s thorough and well-reasoned decision
disqualifying Neff.
B. The District Court Did Not Abuse Its
Discretion in Managing the Trial Calendar
After Neff was disqualified, Lacerda’s new counsel,
Mark Cedrone, requested a lengthy continuance to prepare for
trial. The District Court denied this request. Lacerda now
challenges that denial on appeal. “We review the trial court’s
refusal to grant a continuance for an abuse of discretion.”
United States v. Olfano, 503 F.3d 240, 245 (3d Cir. 2007).
Finding no abuse of the District Court’s discretion, we will
affirm.
“When presented with a motion for continuance, a court
should consider the following factors: the efficient
16
administration of criminal justice, the accused’s rights, and the
rights of other defendants whose trials may be delayed as a
result of the continuance.” Olfano, 503 F.3d at 246. The
District Court considered these factors and, given the time
Cedrone had had to prepare Lacerda’s defense, denied the
motion based on the government’s right to a speedy trial,
efforts to streamline the case, the District Court’s calendar, and
the need to “protect the rights of the parties in other cases.”
App. 670:23–671:9.
Lacerda now argues that the District Court abused its
discretion and prejudiced his defense because, he claims,
Cedrone had only four months to prepare for trial. But that is
inaccurate. Cedrone entered his appearance on Lacerda’s
behalf in November 2012—about eight months before jury
selection began in July 2013—and Cedrone told the District
Court in January 2013 that the scope of his representation was
general and not limited to the disqualification motion. The
District Court did not abuse its discretion.
C. Lacerda’s 2010 Email to Sawyer Was
Properly Excluded as Hearsay
In its case-in-chief, the government presented evidence
showing that Lacerda sometimes used the alias “Robert Klein”
when contacting VOG customers. During the presentation of
his defense, Lacerda testified that he was not the only person
at VOG using that alias. On direct examination, he testified that
he only began using the Robert Klein alias to respond to
customer complaints that otherwise weren’t being addressed
by other employees who would not admit having used the
moniker. He further claimed that he did not use the alias before
2010. The government used that assertion to impeach Lacerda,
confronting him with a check made out to “Robert Klein” in
2009, which he had deposited into his account. On redirect,
Lacerda tried to enter a 2010 email he wrote to VOG’s former
CFO, Jeff Sawyer, asking Sawyer to investigate who else was
using the Robert Klein alias. But the District Court excluded
the email as hearsay.
Lacerda now challenges the District Court’s ruling on
appeal. We review this evidentiary ruling for an abuse of
discretion. United States v. Frazier, 469 F.3d 85, 87 (3d Cir.
17
2006). Finding no abuse of the District Court’s discretion, we
will affirm.
At the time of Lacerda’s trial, a witness’s prior
consistent statement was admissible as non-hearsay only when
the witness testified and was subject to cross-examination, and
the out-of-court statement was offered to rebut a charge of
recent fabrication or recent improper motive. See Fed. R. Evid.
801(d)(1)(B) (2011).4 The Supreme Court had explained that
the purpose of the exception was to rebut a charge of recent
fabrication. Tome v. United States, 513 U.S. 150, 157–58
(1995). “Prior consistent statements [could] not be admitted to
counter all forms of impeachment or to bolster the witness
merely because she has been discredited.” Id. at 157.
In this case, the government did not accuse Lacerda of
recently fabricating the claim that he began using the Robert
Klein alias in 2010. Rather, it employed impeachment by
contradiction: of course, Lacerda was using the Robert Klein
alias before 2010; he profited from using the alias in 2009.
Thus, under the former rules of evidence, Lacerda’s email to
Sawyer was hearsay, and the District Court properly excluded
it.
D. Lacerda’s Sentence Was Procedurally Sound
and Substantively Reasonable
The District Court sentenced Lacerda to 324 months’
imprisonment for his leading role in VOG’s fraudulent
enterprise. On appeal, Lacerda challenges his sentence as
procedurally unsound and substantively unreasonable. Our
standard of review on sentencing challenges is bifurcated. We
“must first ensure that the district court committed no
significant procedural error …. Assuming that the district
court’s sentencing decision is procedurally sound, the appellate
court should then consider the substantive reasonableness of
the sentence imposed under an abuse-of-discretion standard.”
4
Though the Rule was broadly expanded in 2014 to
allow for the use of prior consistent statements to rehabilitate
the witness against other forms of impeachment, see Fed. R.
Evid. 801(d)(1)(B)(ii) (2014), the former rule, with its
limitation, applied in Lacerda’s case.
18
Gall v. United States, 552 U.S. 38, 51 (2007). Applying these
standards, we will affirm the District Court’s sentence.
1. The District Court’s sentence was procedurally
sound
Lacerda argues that the District Court imposed a
procedurally unreasonable sentence because, he alleges, it was
based on a miscalculation of the number of victims of the VOG
scheme and the total financial loss suffered by those victims.
The government bears the initial burden of proving loss by a
preponderance of the evidence. United States v. Ali, 508 F.3d
136, 145 (3d Cir. 2007). The district court must then calculate
the amount of loss associated with the crime of conviction and
any relevant conduct that was “part of the same course of
conduct or common scheme or plan.” United States v. Siddons,
660 F.3d 699, 704 (3d Cir. 2011) (quotation omitted). While
this does not have to be an exact figure, it must be a reasonable
estimate. Ali, 508 F.3d at 145.
Lacerda first asserts that only those victims who
testified during trial or whose victimization underlay a specific
count of the indictment should have been counted as victims,
claiming that including any other victims in the presentence
investigative report (“PSR”) was based on “rank hearsay.”
Appellant Lacerda’s Br. 62–64. Of course, a district court may
rely on hearsay statements during sentencing, if “they bear
some minimal indicium of reliability beyond mere allegation.”
United States v. Smith, 751 F.3d 107, 116 (3d Cir. 2014)
(internal quotations and citation omitted). Victim statements
are reliable when they “involve[ ] matters within the
knowledge of each declarant and were made in the course of
interviews by one or more law enforcement officials.” Id.
In this case, for each victim identified in the PSR, the
government submitted the following:
(1) a declaration of victim losses, completed by
the victims, executed under penalty of
perjury, and submitted to the Probation
Office;
(2) an FD-302 summarizing an officer’s interview with
the victim; and
19
(3) a canceled check verifying the amount the victim
paid to VOG.
That is more than mere allegation and enough under Smith to
show reliability. The District Court’s calculation of victims
was therefore reasonable.
Lacerda next argues that the District Court’s calculation
of loss was erroneous because it failed to offset the victims’
losses with credits for new timeshares and cancellation of prior
debts. This argument is unavailing. The supposed cancellation
of debt was one of the bases for the fraud charges. Cancellation
was not achieved through VOG’s efforts, but through the
victims’ credit-destroying defaults with the timeshare
companies after those victims stopped paying their bills—
relying on VOG’s misrepresentations that their timeshare debts
had been paid off. And the VOG victims were trying to get rid
of their timeshares, not acquire new timeshares. Neither of
these were “services” rendered by VOG; they were part of the
fraudulent scheme. Perpetrators of fraudulent schemes are not
entitled to credits against loss for payments made to perpetuate
their schemes. See United States v. Hartstein, 500 F.3d 790,
800 (8th Cir. 2007) (“[W]hen a defendant’s only subjective
intent regarding repayments relates to this illegal purpose of
perpetuating the scheme, a sentencing court may refuse to
credit repayments against sums received from the victims.”);
United States v. Whatley, 133 F.3d 601, 606 (8th Cir. 1998)
(“[W]e are not inclined to allow the defendants a profit for
defrauding people or a credit for money spent perpetuating a
fraud.”); United States v. Blitz, 151 F.3d 1002, 1012 (9th Cir.
1998) (same).
2. The District Court’s sentence was substantively
reasonable
We will not reverse a sentence as substantively
unreasonable “unless no reasonable sentencing court would
have imposed the same sentence on that particular defendant
for the reasons the district court provided.” United States v.
Tomko, 562 F.3d 558, 568 (3d Cir. 2009) (en banc). Lacerda’s
Guidelines range was calculated between 324 and 405 months.
As demonstrated above, Lacerda has shown no error in that
calculation. The District Court’s sentence of 324 months rests
20
at the very bottom of the range. When “the sentence is within
the Guidelines range, the appellate court may, but is not
required to, apply a presumption of reasonableness.” Gall, 552
U.S. at 51. We will apply the presumption here.
Lacerda presents a table of cases showing a range of
sentences for other fraud cases and argues that his sentence,
though at the bottom of his Guidelines range, is still “23 times
greater than the median sentence for his type of offense.”
Appellant Lacerda’s Br. 67–71. When a defendant seeks to
argue disparate sentencing, he bears the “burden of
demonstrating similarity by showing that other defendants’
circumstances exactly paralleled his, and a court should not
consider sentences imposed on defendants in other cases in the
absence of such a showing by a party.” United States v.
Iglesias, 535 F.3d 150, 161 n.7 (3d Cir. 2008) (citing United
States v. Vargas, 477 F.3d 94, 100 (3d Cir. 2007)) (internal
brackets and quotations omitted). Lacerda has failed to
demonstrate that any of the other defendants’ circumstances
exactly paralleled his. So, “[a]ccording great deference” to the
District Court—as the law requires, United States v. Lessner,
498 F.3d 185, 204 (3d Cir. 2007)—we hold that Lacerda has
failed to overcome the presumption that his sentence was
reasonable.
E. Forfeiture of VOG’s Proceeds Was Not
Clearly Erroneous
After finding that VOG was a wholly fraudulent
scheme, the District Court ordered all its gross proceeds
forfeited under 18 U.S.C. §§ 981(a)(1)(C) & 982(a)(8) and
28 U.S.C. § 2461(c). Lacerda raises two challenges to the
District Court’s forfeiture order on appeal. First, he asserts that
he lacked sufficient notice that the government would seek
forfeiture upon his conviction because the government cited
the wrong criminal forfeiture statutes in its superseding
indictment. Second, he asserts that the District Court’s finding
that all VOG’s revenues were either directly or indirectly
attributable to VOG’s fraud, and so subject to forfeiture, was
clearly erroneous. Because forfeiture orders involve mixed
questions of law and fact, our standard of review here is
bifurcated. We review the District Court’s legal conclusions de
novo and its findings of facts for clear error. See United States
21
v. Gordon, 710 F.3d 1124, 1165 (10th Cir. 2013). Applying
this standard, we find no error by the District Court, and we
will affirm.
1. Lacerda had notice that, upon conviction, the
government would seek forfeiture
In its superseding indictment, the government gave
notice that, upon conviction, it would seek forfeiture of “any
property constituting or derived from proceeds obtained
directly or indirectly as a result of such offenses” under 18
U.S.C. §§ 981(a)(1)(D) & 982(a)(2)(A) and 28 U.S.C.
§ 2461(c). App. 287. Lacerda notes, and the government
concedes, that the cited criminal statutes are not the correct
statutes for forfeiture of proceeds from mail and wire fraud
involving telemarketing. The correct statute is 18 U.S.C.
§ 982(a)(8), the statute under which the District Court ordered
forfeiture. Lacerda first argues that the forfeiture order cannot
be based on the civil forfeiture statute because, under our
precedent in United States v. Vampire Nation, 451 F.3d 189,
199 (3d Cir. 2006), forfeiture orders can be based on 28 U.S.C.
§ 2461(c) only when “there is no specific statutory provision
that permits criminal forfeiture.” Lacerda further argues that,
by citing incorrect forfeiture statutes for his crimes, the
government failed to provide the notice required by the Federal
Rules of Criminal Procedure. Lacerda is mistaken on both
grounds.
First, Lacerda’s reliance on Vampire Nation is
misguided. Our Vampire Nation decision was based on the
language of the prior version of 28 U.S.C. § 2461(c).5 Giving
5
The applicable statute read:
If a forfeiture of property is authorized in
connection with a violation of an Act of
Congress, and any person is charged in an
indictment or information with such violation
but no specific statutory provision is made for
criminal forfeiture upon conviction, the
government may include the forfeiture in the
indictment or information in accordance with the
Federal Rules of Criminal Procedure, and upon
22
the words of that statute their plain meaning, we concluded that
“criminal forfeiture is not permitted unless (1) a substantive
provision exists for civil forfeiture of the criminal proceeds at
issue; and (2) there is no specific statutory provision that
permits criminal forfeiture of such proceeds.” Vampire Nation,
451 F.3d at 199. In 2006, Congress amended the statute and
eliminated the second requirement. 6 The amendment to
28 U.S.C. § 2461(c) effectively abrogates the portion of
Vampire Nation upon which Lacerda now relies. Under the
current version of the statute, the District Court correctly
conviction, the court shall order the forfeiture of
the property in accordance with the procedures
set forth in section 413 of the Controlled
Substances Act ( 21 U.S.C. 853), other than
subsection (d) of that section.
28 U.S.C. § 2461(c) (2000) (emphasis added).
6
The statute now reads:
If a person is charged in a criminal case with a
violation of an Act of Congress for which the
civil or criminal forfeiture of property is
authorized, the government may include notice
of the forfeiture in the indictment or information
pursuant to the Federal Rules of Criminal
Procedure. If the defendant is convicted of the
offense giving rise to the forfeiture, the court
shall order the forfeiture of the property as part
of the sentence in the criminal case pursuant to
to [sic] the Federal Rules of Criminal Procedure
and section 3554 of title 18, United States Code.
The procedures in section 413 of the Controlled
Substances Act (21 U.S.C. 853) apply to all
stages of a criminal forfeiture proceeding, except
that subsection (d) of such section applies only
in cases in which the defendant is convicted of a
violation of such Act.
28 U.S.C. § 2461(c) (2006).
23
ordered restitution, and Lacerda had notice under the civil
statute.
Second, the government provided Lacerda with
sufficient notice under the criminal rules. Federal Rule of
Criminal Procedure 32.2 sets forth the notice requirement that
must be met before forfeiture can be ordered by a district court.
It states:
A court must not enter a judgment of forfeiture
in a criminal proceeding unless the indictment or
information contains notice to the defendant that
the government will seek the forfeiture of
property as part of any sentence in accordance
with the applicable statute.
Fed. R. Crim. P. 32.2(a). This rule does not require the level of
specificity demanded by Lacerda. Rather, as we have held, “[a]
conclusory forfeiture allegation in the indictment that
recognizably tracks the language of the applicable criminal
forfeiture statute” is sufficient under the rule. United States v.
Sarbello, 985 F.2d 716, 719 (3d Cir. 1993). We recognize that
Sarbello specifically addressed then-Rule 7(c)(2), which was
removed with the 2009 amendments. But that rule was
removed only because it had become obsolete: “In 2000 the
same language was repeated in subdivision (a) of Rule 32.2,
which was intended to consolidate the rules dealing with
forfeiture.” See Fed. R. Crim. P. 7 note (2009 Amendment).
We now hold, consistent with Sarbello, that general notice of
forfeiture is sufficient under Rule 32.2. Thus, Lacerda had
sufficient notice that the government would seek forfeiture
upon his conviction.
2. Based on its finding that VOG used its revenues to
promote and facilitate its fraud, the District Court
correctly ordered those revenues forfeited
Lacerda next contends that the District Court erred by
subjecting all VOG’s proceeds to forfeiture rather than limiting
the order to the losses directly claimed by VOG’s victims. But
the relevant statute is not so narrow. Rather, addressing the
crimes committed by Lacerda at VOG, 18 U.S.C. § 982
requires the court to
24
order that the defendant forfeit to the United
States any real or personal property—
(A) used or intended to be used to commit, to
facilitate, or to promote the commission
of such offense; and
(B) constituting, derived from, or traceable to
the gross proceeds that the defendant
obtained directly or indirectly as a result
of the offense.
18 U.S.C. § 982(a)(8). The District Court found that VOG was
a fraudulent enterprise from beginning to end, and that all its
gross proceeds were used to further its fraud. Based on those
findings, the District Court correctly ordered the forfeiture of
all VOG’s proceeds.
Lacerda does not appear to challenge the District
Court’s findings on appeal. Instead, he argues that what it
means for property to be “indirectly” derived, traceable, or
obtained from an offense is ambiguous, so the rule of lenity
should govern our interpretation of the forfeiture statute. We
reject this argument. First, it is irrelevant. The District Court’s
order focused on the fact that VOG had used all its revenues to
promote and facilitate its fraud, not on whether those revenues
were direct or indirect. Second, “[t]he rule of lenity … is
inapplicable if there is only a mere suggestion of ambiguity
because most statutes are ambiguous to some degree.” United
States v. Cheeseman, 600 F.3d 270, 276 (3d Cir. 2010)
(internal quotation omitted). Lacerda has failed to show that
the forfeiture statute is ambiguous—much less sufficiently
ambiguous—to warrant application of the rule of lenity.
Recently, the Supreme Court of the United States
explained that the purpose of forfeiture statutes is to separate
the criminal from his ill-gotten gains, to return, in full, the
property of defrauded victims, and to lessen the economic
power of criminal enterprises. Honeycutt v. United States, 137
S. Ct. 1626, 1631 (2017) (citing Caplin & Drysdale, Ctd. v.
United States, 491 U.S. 617, 629–30 (1989)). The District
Court’s forfeiture order here meets those purposes. The District
Court found that VOG was a thoroughly corrupt criminal
25
conspiracy from beginning to end, and that its revenue was
used to promote and facilitate its crimes. That finding is
supported by substantial evidence and does not appear to be
challenged by Lacerda on appeal. The District Court correctly
ordered the forfeiture of all of VOG’s revenues.
IV. Objections Raised by Resnick
Like Lacerda, Resnick also raises several additional
issues on appeal. He claims that (1) the government suppressed
material evidence; (2) the District Court miscalculated the
number of his victims and the loss amount for those victims,
and so erred at sentencing; (3) his due process rights were
violated when his sentencing hearing was delayed; and (4) the
District Court’s restitution order was procedurally unsound and
substantively unreasonable. We will address each argument in
turn.
A. The Government Did Not Commit a Brady
Violation
Resnick asserts that the government violated its
obligations under Brady v. Maryland, 373 U.S. 83 (1963), by
withholding evidence which he might have used to impeach
Special Agent Mesisca. Specifically, Resnick claims that the
government withheld the documents that were the basis of a
victim’s, Dorothy Gerlach’s, FD-3027 and withheld Gerlach’s
later-produced “Declaration of Victim’s Losses.” Resnick
preserved this argument by raising it to the District Court in a
motion for a new trial based on newly discovered evidence.
The District Court correctly denied that motion.
Under Brady, the government has a duty to disclose
“evidence that is favorable to the defense and material to the
defendant’s guilt or punishment.” Smith v. Cain, 565 U.S. 73,
75 (2012). Thus, there are three prerequisites to a Brady
violation: (1) the government must have failed to disclose
evidence; (2) that evidence must have been favorable to the
defendant; and (3) that evidence must have been material.
7
The FD-302, commonly referred to simply as a “302”,
is the form commonly used by FBI agents to summarize
witnesses’ statements and interviews.
26
Evidence is “material” only if there is a reasonable probability
that its disclosure would have led to a different outcome at trial,
and so undermines confidence in the verdict. Turner v. United
States, 137 S. Ct. 1885, 1893 (2017). The evidence Resnick
claims was withheld fails to satisfy each of the three
prerequisites.
Contrary to Resnick’s assertions, the government did
not withhold the evidence. The documents underlying
Gerlach’s 302, labeled as “DG-3”, were disclosed before trial.
The Declaration of Victim’s Losses, “DG-2”, was received by
the probation office in May 2013, but not forwarded to the
prosecutor until late in 2014. The prosecutor disclosed the
declaration with other documents in January 2015.
Resnick is correct that the failure to disclose
information known only to police investigators can still
implicate the prosecution, even when the prosecutor was
unaware of the information. Youngblood v. West Virginia, 547
U.S. 867, 869–70 (2006). But probation officers in the federal
system are not police investigators; they are “the court’s eyes
and ears and provide information and recommendations to the
court.” United States v. Amatel, 346 F.3d 278, 279 (2d Cir.
2003). We will not impute to the prosecution the Probation
Office’s failure in 2013 to disclose Gerlach’s “Declaration of
Losses” to Resnick.
But even if we did impute to the prosecution the
Probation Office’s failure to disclose, it still would not
constitute a Brady violation. Far from being material evidence
that could have undermined Resnick’s conviction, this
evidence reinforces the jury’s verdict. Resnick admitted that
“he pitched a bank settlement deal to Ms. Gerlach.” App.
7737:19–21. There were two parts to the bank settlement pitch:
VOG promised to help the victims pay off their debt and keep
their timeshare property, and then, in a bait and switch, sold
them a second timeshare through VOG. Gerlach’s declaration,
which expresses confusion over not receiving points she was
promised, highlights that bait and switch. Thus, the declaration
was not exculpatory; it was inculpatory.
We conclude that the government did not violate its
obligations under Brady.
27
B. The Timing of Resnick’s Sentencing Did Not
Violate His Sixth Amendment or Due
Process Rights
Resnick next claims that his speedy sentencing rights
were violated when his sentence was not imposed for more
than two-and-a-half years following his conviction. We once
recognized a right to a speedy sentencing hearing under both
the Sixth Amendment and the Due Process Clause. See
Burckett v. Cunningham, 826 F.2d 1208, 1219–21 (3d Cir.
1987). But the Supreme Court of the United States has since
clarified that the Sixth Amendment guarantees a defendant the
right to a speedy trial, not a speedy sentencing. Betterman v.
Montana, 136 S. Ct. 1609, 1613 (2016). “That does not mean,
however, that defendants lack any protection against undue
delay at [sentencing].” Id. at 1617. Federal Rule of Criminal
Procedure 32(b)(1) requires courts to “impose sentence
without unnecessary delay.” Id. And, the Supreme Court noted,
the convicted defendant maintains his due process rights. Id.
Thus, while Betterman overruled our speedy sentencing
precedent under the Sixth Amendment, our precedent under the
Due Process Clause survives. Under that precedent, we apply
the same framework adopted by the Supreme Court in Barker
v. Wingo, considering: (1) the length of the delay; (2) the
reasons for the delay; (3) the defendant’s assertion of his right;
and (4) any prejudice suffered by the defendant. 407 U.S. 514,
530 (1972). Consideration of these factors leads us to the
conclusion that Resnick suffered no deprivation of his due
process right to a speedy sentencing.
First, the length of the delay between conviction and
sentencing—more than two-and-a-half years—was
substantial. This factor favors Resnick.
But second, as the District Court found, three things
contributed to the delay in getting to sentencing. (1) This was
a very complex fraud scheme involving 18 separate
defendants, and the deliberation necessary to address the
scheme and its victims required time. (2) Resnick sought
several continuances of his sentencing. The government, on the
other hand, never requested a continuance. (3) The District
Court delayed sentencing to research Resnick’s claims that
28
some of the purported victims were not really victims. So any
unnecessary delays, if there were unnecessary delays, are
mainly attributable to Resnick. None are attributable to the
government. This factor weighs heavily against Resnick.
Third, Resnick asserted his right to a speedy sentencing
in a motion filed on March 3, 2016. Ironically, that motion also
sought leave to serve a Rule 17(c) subpoena to obtain
additional documents, which would have further delayed
sentencing. (Id.) Resnick’s sentencing hearing took place on
April 22, 2016, seven weeks after he filed his request. If this
factor favors Resnick, it does so with little weight.
Fourth and finally, Resnick asserts that the delays to his
sentencing prejudiced him because the government was able to
identify additional victims and adduce sufficient evidence to
prove their losses by a preponderance of the evidence. We do
not think this argument is well taken. Allowing the government
time to identify additional victims did not affect his Sentencing
Guidelines range. Resnick’s victim and loss total—whether
calculated in 2014 under the initial PSR at 124 victims with
$1.2 million in losses, or the government’s initial filing of 192
victims with $2.1 million in losses, or in 2015 under the
government’s revised filing of 253 victims with $2.7 million in
losses—always yields a 16-level enhancement. Compare
U.S.S.G. § 2B1.1(b)(1) (2014), with U.S.S.G. § 2B1.1(b)(1)
(2015). Thus, Resnick’s Guidelines range was unaffected, and
he has failed to show prejudice. This factor also weighs heavily
against Resnick.
Taking the four factors together, we conclude that
Resnick has failed to show that his due process right to a
speedy sentence was violated.
C. The District Court Correctly Applied the
Sentencing Guidelines In Fashioning
Resnick’s Sentence
Resnick next challenges several of the District Court’s
findings at sentencing. We “review factual findings relevant to
the Guidelines for clear error and … exercise plenary review
over a district court’s interpretation of the Guidelines.” United
States v. Grier, 475 F.3d 556, 570 (3d Cir. 2007).
29
First, Resnick claims that by adopting the government’s
proposed timeline for VOG’s operations the District Court
allowed the government to inflate its victim and loss figures.
He argues that, because the government limited the timeframe
for its evidence at trial, any victims found outside of that
limited timeframe should not count. Of course, because the
VOG-conspirators continued operations during their trial—
through 2014—some victims arose after the government’s
limited timeframe. It was appropriate for those victims to be
included. And we again note that the government’s calculation
of victims’ losses did not affect Resnick’s ultimate Guidelines
range.
The Sentencing Guideline that applies to Resnick’s
fraud is § 2B1.1, covering various forms of theft. Following
the 2015 amendment, a six-level enhancement should be
applied when the crime “resulted in substantial financial
hardship to 25 or more victims.” U.S.S.G. § 2B1.1(b)(2)(C).
That is the highest-level enhancement for number of victims.
The definition of “substantial financial hardship” includes
“suffering substantial harm to his or her ability to obtain
credit.” See U.S.S.G. application notes § 4(F)(vi). As the credit
ratings of all the victims of VOG were severely damaged by
VOG’s schemes, Resnick began on the wrong side of that
threshold. That the government ultimately identified more than
250 victims was immaterial for the Guidelines calculation.
And, as discussed in section IV(B), whether using the initial
victim and loss estimates in 2014, or the more comprehensive
totals following the 2015 amendment, Resnick’s victims’ loss
total yields the same 16-level enhancement.
Second, Resnick challenges the District Court’s finding
that VOG was a fraudulent enterprise from beginning to end.
Resnick argues that not all VOG’s employees knew that they
were part of a fraudulent scheme, so there must have been some
non-fraudulent work at VOG. This conclusion does not follow
from Resnick’s premise because those employees’ alleged
ignorance is not imputed to Resnick and his co-defendants. A
conviction for mail or wire fraud requires both objective
misrepresentations and the defendant’s subjective knowledge
of the misrepresentations. See 18 U.S.C. §§ 1341, 1343. The
jury found that Resnick knowingly participated in VOG’s
30
fraud, so the argument based on others’ alleged knowledge
does not help him.
Resnick also argues that the finding is inconsistent with
the District Court’s willingness to consider his argument that
not all VOG victims were equally victimized. The District
Court noted that VOG had engaged in various types of fraud.
That the Court recognized that some instances of VOG’s fraud
were more flagrant than others does not undermine the District
Court’s overall finding that VOG was a wholly fraudulent
enterprise. Rather, having carefully reviewed this case, we
conclude that the Court’s finding was supported by substantial
evidence and will be affirmed.
Third, like Lacerda, Resnick argues that services like
debt cancellation and the sale of new timeshares should be
credited against the victims’ losses. We addressed this
argument in section III(D)(1), and our analysis applies equally
to Resnick. Cancellation was achieved only because the
victims defaulted on their loans, not because of some value-
adding intervention from VOG. The defaults impacted the
victims’ credit ratings in significant and negative ways. The
District Court was correct to not credit VOG’s alleged
“services” against the losses suffered by Resnick’s victims.
And like Lacerda, Resnick is not entitled to credit against his
victim’s losses for payments VOG made to perpetuate its
fraudulent schemes. See Hartstein, 500 F.3d at 800; Whatley,
133 F.3d at 606; Blitz, 151 F.3d at 1012.
Fourth and finally, Resnick argues that, under U.S.S.G.
§ 2B1.1, refunded monies by third parties should be credited
against his victim’s losses. The Guidelines provides that the
victim’s loss “shall be reduced by … [t]he money returned …
by the defendant or other persons acting jointly with the
defendant, to the victim before the offense was detected.”
U.S.S.G. § 2B1.1(3)(E)(i) (emphasis added). Resnick argues
that he is entitled to credit for refunds to victims made by
“escrow compan[ies] utilized to procure third party
timeshares” and other “timeshare developers.” Appellant
Resnick’s Br. 71. But there is no evidence that the escrow
agents and timeshare developers were “acting jointly” with
Resnick, or that the refunds were made “before the offense was
31
detected.” The District Court correctly denied any credits
against Resnick’s victims’ losses.
D. Resnick Forfeited His Objection to the
District Court’s Restitution Order
Because of the many complexities of this case,
restitution was delayed until sometime after sentencing. While
Resnick filed a timely notice of appeal from his judgment and
sentence, he never appealed from the later-entered order of
restitution. Resnick now raises various challenges to the
District Court’s award of restitution entered against him under
18 U.S.C. § 3663A. But the government contends that we must
dismiss Resnick’s challenges because of his failure to file a
separate notice of appeal from the restitution order. The
government is correct.
This issue raises a jurisdictional question, over which
we exercise plenary review. Hamilton v. Bromley, 862 F.3d
329, 333 (3d Cir. 2017). Resolution of this question is
controlled by Manrique v. United States, 137 S. Ct. 1266, 1274
(2017), in which the Supreme Court held “that a defendant who
wishes to appeal an order imposing restitution in a deferred
restitution case must file a notice of appeal from that order.”
Deferred restitution cases, the Supreme Court explained,
involve two appealable judgments, not one. Id. at 1273; see
also Dolan v. United States, 560 U.S. 605, 616–18 (2010).
Both the statute and rules governing appeals “contemplate that
the defendant will file the notice of appeal after the district
court has decided the issue sought to be appealed.” Manrique,
137 S. Ct. at 1271 (emphasis original). So notices of appeal
filed before the restitution order cannot be “for review” of the
restitution order and are not filed timely from that order. Id.
The Supreme Court held that filing a timely notice of appeal
from an order of restitution was at least a mandatory claim-
processing rule, id. at 1272 (citing Greenlaw v. United States,
554 U.S. 237, 252–53 (2008)), and when the government raises
the failure to timely file the notice, our duty to dismiss the
appeal is also mandatory, id. (citing Eberhart v. United States,
546 U.S. 12, 15, 19 (2005)).
Resnick did not file a timely notice of appeal from the
order of restitution, and the government has raised this failure
32
on appeal. Thus, under Manrique, Resnick at least violated a
mandatory claim-processing rule and we have a mandatory
duty to dismiss this issue.
V. Objections Raised by Manzoni
In addition to Manzoni’s challenge to Special Agent
Mesisca’s overview testimony, she also argues that (1) the
District Court abused its discretion by allowing the prosecution
to impeach a codefendant with an audio recording that
implicated her; (2) the District Court erred when it joined the
charges arising from her participation in the fraudulent
activities at VOG and her charge of alleged unemployment
fraud; and (3) there was insufficient evidence presented to the
jury to sustain her fraud and conspiracy convictions. We will
address each of these issues in turn.
A. The District Court Did Not Abuse Its
Discretion in Admitting Evidence of a Phone
Call to a Victim
During trial, it came to light that some defendants had
engaged in witness tampering. The government sought to enter
the recording of a phone call between one of the defense
witnesses, Dennis Nadeau, and a victim, David Jasper,
showing an attempt at such tampering. Manzoni objected to
admission of the recording on two grounds. At first, she argued
that it was unduly prejudicial under Federal Rule of Evidence
403 because, though the evidence of tampering was not being
offered against her, she was the subject of the victim’s
complaint. But this was not apparent from the phone call itself;
Manzoni was never actually named by the victim. So she also
argued that the phone call should be excluded as hearsay. She
presents these same arguments on appeal.
1. The District Court did not abuse its discretion
under Rule 403
Manzoni asserts that the District Court abused its
discretion under Rule 403 by allowing the recording of the
phone call into evidence. “We generally review a district
court’s evidentiary findings for abuse of discretion.” United
States v. Bailey, 840 F.3d 99, 117–18 (3d Cir. 2016). Rule 403
allows relevant evidence to be excluded when its probative
33
value is substantially outweighed by the potential for unfair
prejudice. Id. at 117. When a district court conducts an on-the-
record weighing of probative value against unfair prejudice, its
evidentiary decision is entitled to great deference. Id. “In order
to justify reversal, a district court’s analysis and resulting
conclusion must be arbitrary or irrational.” Id.
In this case, the District Court conducted an on-the-
record Rule 403 analysis—both orally and in a later written
order. The District Court found that the phone call’s “probative
value as to the consciousness of guilt” outweighed any
prejudice. App. 5015:3–5. But it also recognized that there
could be some spillover effect for Manzoni, so it acted to
mitigate that unfair prejudice by offering multiple curative
instructions—including one drafted by Manzoni. The District
Court’s analysis and its conclusion were neither arbitrary nor
irrational. We therefore find no abuse of the District Court’s
discretion under Rule 403, and we will uphold the District
Court’s decision to allow the recording into evidence.
2. Because the phone call was offered for a non-
hearsay purpose, it was not hearsay
Manzoni next argues that the phone call was hearsay.
“Whether a statement is hearsay is a legal question subject to
plenary review.” United States v. Price, 458 F.3d 202, 205 (3d
Cir. 2006). Under Federal Rule of Evidence 801(c), “hearsay”
is any statement that a declarant makes outside of court and
that is offered to prove the truth of the matter asserted in the
statement. Statements offered for non-hearsay purposes are not
hearsay. See Price, 458 F.3d at 211. As the advisory
committee’s notes to the rule make clear, statements that are
offered merely to show that they happened are not offered for
a hearsay purpose. See Fed. R. Evid. 801 note (subdiv. (c))
(citing Emich Motors Corp. v. General Motors Corp., 181 F.2d
70 (7th Cir. 1950), rev’d on other grounds 340 U.S. 558
(1951)). The recording of the phone call between Nadeau and
Jasper was not offered to prove the truth of any of Jasper’s
assertions, but to show that Nadeau had in fact contacted some
of the victims. So the phone call was not hearsay, and Manzoni
has failed to show that the District Court abused its discretion
by allowing it into evidence.
34
B. Manzoni Was Not Prejudiced by the Joinder
of Her VOG-Fraud and Employment-Fraud
Charges
In separate counts, Manzoni was charged with fraud and
conspiracy for her participation in the VOG scheme, and with
fraud for allegedly collecting unemployment benefits from the
State of New Jersey while she was employed at VOG. Manzoni
moved to sever the charges under Federal Rule of Criminal
Procedure 8. Although the District Court recognized that the
propriety of joinder here was a close question, it denied her
motion. Manzoni argues that it was error to join her VOG-fraud
and unemployment-fraud charges because they lacked a
sufficient nexus and were not part of the same transaction. The
appeal of a denial of a motion under Rule 8 is a claim of legal
error, which we review de novo. United States v. Jimenez, 513
F.3d 62, 82 (3d Cir. 2008).
Joinder is controlled by Rule 8. Generally, Rule 8(a)
addresses joinder of offenses and Rule 8(b) joinder of
defendants. But Rule 8(a) only applies to prosecutions
involving a single defendant; “in a multi-defendant case such
as this, the tests for joinder of counts and defendants is merged
in Rule 8(b).” United States v. Irizarry, 341 F.3d 273, 287 (3d
Cir. 2003) (internal quotations omitted). “Although the
standards of Rule 8(a) and Rule 8(b) are similar, in that they
both require a transactional nexus between the offenses or
defendants to be joined, Rule 8(a) is more permissive than Rule
8(b) because Rule 8(a) allows joinder on an additional ground,
i.e., when the offenses are of the same or similar character.” Id.
at 287 n.4 (citations and internal quotations omitted); see also
Jimenez, 513 F.3d at 82 (“[J]oinder of defendants under Rule
8(b) is a stricter standard than joinder of counts against a single
defendant under Rule 8(a).”). For joinder of Manzoni’s cases
to have been proper under Rule 8(b), they either would have
had to originate “in the same act or transaction,” or have
otherwise been integral to one another. See United States v.
Riley, 621 F.3d 312, 334 (3d Cir. 2010).
The District Court determined that joinder was proper
because Manzoni’s employment in the VOG scheme was
integral to the unemployment-fraud charge: she was charged
with fraudulently collecting unemployment benefits while she
35
was employed by, and receiving compensation from, VOG.
But the opposite is not necessarily true. Rather, Manzoni
suggests, allegations that she illicitly collected unemployment
benefits would not have been integral to her participation in the
VOG scheme, so joinder was improper. But even assuming,
arguendo, that Manzoni is correct, the District Court still did
not commit reversible error.
Under Federal Rule of Criminal Procedure 52(a), we
must disregard “[a]ny error, defect, irregularity, or variance
that does not affect substantial rights ….” We have explained
that “an error involving misjoinder affects substantial rights
and requires reversal only if the misjoinder results in actual
prejudice because it had substantial and injurious effect or
influence in determining the jury’s verdict.” Jimenez, 513 F.3d
at 83 (brackets and internal citations omitted). Here, any
potential misjoinder would have been harmless because the
record shows that the joinder did not influence the jury’s
verdict against Manzoni; after all, she was acquitted of the
allegedly misjoined charge.
Because Manzoni’s employment at VOG was integral
to the unemployment-fraud charges, unfair prejudice in this
case can only flow in one direction. That is, it would have been
proper for the jury to conclude that, because Manzoni was
employed and receiving compensation with the VOG scheme,
she was committing fraud by receiving unemployment benefits
from the State of New Jersey. It would have been improper,
however, for the jury to conclude that, because Manzoni
committed unemployment fraud, she must also have
participated in the VOG fraud. But the jury did not reach that
conclusion; rather, it convicted Manzoni of her role in the VOG
scheme despite acquitting her of unemployment fraud. So
joinder of the fraud counts did not affect the jury’s verdict and
any error in joining the charges was harmless.
C. Manzoni’s Conviction Was Supported by
Sufficient Evidence
Finally, Manzoni challenges the sufficiency of the
evidence to support her fraud and conspiracy convictions. Our
standard of review on a challenge to the sufficiency of the
evidence is plenary. United States v. Boria, 592 F.3d 476, 480
36
(3d Cir. 2010). But that plenary review is greatly tempered by
giving substantial deference to the jury’s finding of guilt. See
Jackson v. Virginia, 443 U.S. 307, 318–19 (1979). Employing
that deference, and applying the applicable legal standards, we
find the evidence was sufficient to support the jury’s guilty
verdict.
The Supreme Court of the United States has explained:
[T]he critical inquiry on review of the
sufficiency of the evidence to support a criminal
conviction must be … to determine whether the
record evidence could reasonably support a
finding of guilt beyond a reasonable doubt. But
this inquiry does not require a court to ask itself
whether it believes that the evidence at the trial
established guilt beyond a reasonable doubt.
Instead, the relevant question is whether, after
viewing the evidence in the light most favorable
to the prosecution, any rational trier of fact could
have found the essential elements of the crime
beyond a reasonable doubt.
Jackson, 443 U.S. at 318–19 (internal quotations and citations
omitted). In conducting this review, all reasonable inferences
must be drawn in favor of sustaining the verdict. United States
v. Anderskow, 88 F.3d 245, 251 (3d Cir. 1996). Reversal of a
conviction is only appropriate where there is “no evidence,
regardless of how it is weighted, from which the jury could find
guilt beyond a reasonable doubt.” United States v. Mussare,
405 F.3d 161, 166 (3d Cir. 2005).
Manzoni was charged with conspiracy to commit wire
fraud under 18 U.S.C. § 1349 and wire fraud under 18 U.S.C.
§ 1343. To prove wire fraud, the government had to show that
Manzoni had the intent to commit fraud. See 18 U.S.C. § 1343.
So the question here is whether Manzoni’s participation in the
VOG scheme was knowing or intentional.
Manzoni argues that the evidence presented at trial at
most showed that she said things as a VOG representative that
were not true, not that she was a knowing participant in the
fraud. She claims that this case should be controlled by United
37
States v. Pearlstein, 576 F.2d 531, 542–43 (3d Cir. 1978), in
which we reversed the fraud convictions of lowly sales
representatives who only read from a sales script, without
knowing that the script contained false statements. In light of
the evidence admitted at trial, we find that Pearlstein does not
apply.
First, Manzoni was no lowly sales representative—she
was one of the managers at VOG. From her position as a
manager, and her long experience in the timeshare industry, a
jury could reasonably infer that she knew that statements in
VOG’s phone scripts were false. Second, even before she was
a manager, while working as one of VOG’s closers, Manzoni
did more than just mechanically read false statements from a
controlled sales script. She showed initiative by inventing fake
payoff amounts for the customers, without approval—much
less direction—from her supervisors, and then creating
urgency by imposing arbitrary deadlines by which these (fake)
offers had to be accepted before they expired. Based on this
evidence, as the District Court correctly found, a reasonable
jury could conclude beyond a reasonable doubt that Manzoni
was “a knowing, even integral part, of [the] fraud scheme.” SA
1151.
VI. Conclusion
For all of the reasons discussed above, we will affirm
the judgments of conviction and sentences entered against
Lacerda, Resnick, and Manzoni.
38