United States v. Grayson Enterprises, Inc. ( 2020 )

In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 19-1367
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v.
GRAYSON ENTERPRISES, INC.,
Defendant-Appellant.
____________________
Appeal from the United States District Court for the
Central District of Illinois.
No. 2:16-cr-20044-SEM-TSH-2 — Sue E. Myerscough, Judge.
____________________
ARGUED SEPTEMBER 26, 2019 — DECIDED FEBRUARY 12, 2020
____________________
Before BAUER, MANION, and ST. EVE, Circuit Judges.
ST. EVE, Circuit Judge. Grayson Enterprises, Inc., is a roof-
ing company that does business under the trade name Gire
Roofing. A grand jury indicted Grayson alongside its busi-
ness’s namesake, Edwin Gire, on charges of visa fraud, har-
boring unauthorized aliens, and employing the same aliens.
On paper, though, Gire had no official relation to Grayson
as a corporate entity—he was not a stockholder, officer, or
2 No. 19-1367
even an employee of the corporation. He managed the roofing
(Grayson’s sole business), as he had under the Gire Roofing
name for more than twenty years. The corporate papers in-
stead identified Grayson’s president and sole stockholder as
Kimberly Young. Young—Gire’s girlfriend—incorporated
and acted as president of the “new” company Grayson, after
Gire’s previous roofing company went bankrupt. Gire, his re-
tained counsel, and the government all nevertheless repre-
sented to the district court that Gire was Grayson’s president.
The district court, thus, permitted Gire to plead guilty on his
and Grayson’s behalf to three counts of employing unauthor-
ized aliens and to waive his and Grayson’s rights to a jury trial
on the remaining charges. Joint counsel also represented both
defendants during a bench trial that resulted in their convic-
tions on all charges and a finding that Grayson’s headquarters
was forfeitable to the government because Gire had used the
building to harbor aliens.
Despite obtaining separate counsel before sentencing, nei-
ther Grayson nor Young (who testified at trial) ever com-
plained to the district court about Gire’s or prior counsel’s
representations. Neither did Grayson object to the indictment,
the plea colloquy, or the fact that the court found, without a
separate hearing, that Grayson had used its headquarters to
facilitate the harboring of unauthorized aliens. Nevertheless,
Grayson now challenges all these matters, and more, on ap-
peal. Grayson identifies some areas where this case could
have gone more smoothly but no errors that warrant reversal.
We therefore affirm the district court’s judgment.
No. 19-1367 3
I. Background
A. Factual Background
Gire began his roofing business in the 1990s and has con-
ducted it under multiple corporate entities, all of which have
used the business name “Gire Roofing.” In 2011, this name
belonged to Gire Construction, Inc., of which Gire was presi-
dent and owner. On behalf of his corporation, Gire submitted
a petition for temporary foreign workers under the H-2B visa
program, which allows a limited number of foreign workers
to enter the United States “to perform … temporary service or
labor if unemployed persons capable of performing such ser-
vice or labor cannot be found in this country.” 8 U.S.C.
§ 1101(a)(15)(H)(ii)(b).
To show a need for these temporary workers, Gire told the
government, under penalty of perjury, that his company had
received two massive roofing contracts. No such contracts ex-
isted; Gire had made them up and created false documents to
support his fabrication. The government did not know this at
the time, of course, so it accepted Gire’s petition and ap-
proved him to receive 93 H-2B workers. These workers ob-
tained their visas, arrived in the United States, but never
worked for Gire. He nonetheless applied later that year for an
extension and reassignment of 19 workers’ visas from another
company to Gire Construction. These workers, too, did not
work for Gire.
Around the same time, Gire Construction was going
through financial difficulties, and Young became involved.
She and Gire created two corporations, the first was Grayson,
which immediately adopted the name Gire Roofing and
stepped into its operations. A month later, Gire filed for
4 No. 19-1367
Chapter 7 bankruptcy personally and on behalf of Gire Con-
struction, which he dissolved. Young and Gire represented to
creditors that Gire was the general manager of Grayson, re-
sponsible for its daily operations. On paper, though, Young
owned 100 percent of Grayson, and Gire was neither its officer
nor its employee. Grayson also represented to Illinois agen-
cies that it had no employees. Young herself worked a full-
time job elsewhere.
Young’s second corporation was Quick Leasing, Inc.
(Quick being her former surname). By the end of 2011, Quick
Leasing acquired five apartments in Villa Grove, Illinois, that
had belonged to Gire until shortly before his bankruptcy. At
times, Quick Leasing leased these apartments to some of
Grayson’s workers, and Gire deducted rent—but never taxes
or employment insurance—from their paychecks.
Gire applied again to receive H-2B workers using a set of
false contracts in 2013. He and Young worked closely with an
attorney to prepare this application, and Gire submitted it on
behalf of “Grayson Enterprises Incorporated, d/b/a Gire Roof-
ing, care of Edwin Gire” and signed parts of the petition as
the “owner” or “president” of Grayson. The government ap-
proved Grayson to receive 43 workers. When these workers
arrived in Illinois, Young took them to purchase supplies and
to obtain Employee Identification Numbers. After doing so,
all but one, Cresencio Garcia-Cruz, left to parts unknown.
Garcia-Cruz moved into one of the Villa Grove apartments
and stayed to work for Grayson and Gire.
According to Young, Gire was frustrated that only one
worker stayed and complained to his recruiter, Kevin Daley.
Whenever Gire had his petitions approved, it was Daley who
was in Mexico finding people for the government to give the
No. 19-1367 5
visas (although Gire had said in his 2013 and 2014 petitions
that he was not using a recruiter). As a supposed refund for
the walkouts, Daley wired $4,000 to Young’s personal bank
account; he had sent Gire Construction a similar $2,000 pay-
ment in 2011. Daley, however, had not been recruiting work-
ers but illegally selling the visas. Garcia-Cruz had purchased
his for $3,500.
Around the beginning of 2014, Quick Leasing sold the
Villa Grove apartments and used the funds to purchase a
warehouse in Champaign, Illinois. It leased the warehouse to
Grayson to use as a headquarters. Prior to that, Grayson had
a much smaller headquarters, and Gire did most of his office
work out of Young’s home, where he lived as well.
Gire renovated part of the warehouse into a dormitory,
with bedrooms, communal bathrooms, and shared living
space. He then asked Garcia-Cruz and another Grayson
worker, Rene Lopez-Constantino, to move out of the Villa
Grove apartments and into the warehouse. Several more
workers (the government estimated twelve) moved in too, in-
cluding Dario Torres-Hernandez. By this point Garcia-Cruz’s
visa had expired and he was no longer permitted to stay in
the United States. Both Torres-Hernandez and Lopez-Con-
stantino were never authorized to enter the United States.
While these three men lived in the warehouse, Gire withheld
rent from their pay.
Young soon quit her job to take care of her and Gire’s
daughter. A few months later, she started working for Gray-
son, helping with marketing. She received her own office in
the warehouse, next to Gire’s.
6 No. 19-1367
Gire submitted a fourth application for H-2B workers
around this time, yet again relying on a series of fake contracts
to justify his need for workers. Again, he and Young worked
closely with their attorney, and Gire signed the petition as
owner and president of Grayson Enterprises d/b/a Gire Roof-
ing. The government approved the application but never is-
sued the visas. Employees at the Mexican consulate had inter-
viewed some of the workers who had received visas in 2011,
and they admitted to never working for Gire. This triggered
an investigation that uncovered Gire’s fraud.
In May 2014, the government executed a search warrant
on the warehouse. They discovered the dormitory and identi-
fication documents for at least fourteen Grayson workers,
many apparently unauthorized to be in the United States. In
Young’s office, agents found original copies of portions of the
2013 and 2014 applications, the falsified contracts, and letters
notifying Grayson that its request for workers had been ap-
proved. After the search, Garcia-Cruz, Torres-Hernandez,
and Lopez-Constantino moved out of the warehouse. Young
helped them find new housing, as they continued to work for
Gire. After Garcia-Cruz and Torres-Hernandez stopped
working for Gire, they stayed in their apartments and paid the
rent themselves (at a lower cost to them).
B. Procedural Background
Two years later, a grand jury returned a ten-count indict-
ment against Gire and Grayson. The first two counts, for visa
fraud, 18 U.S.C. § 1546, related only to Gire and his two fraud-
ulent applications in 2011 on behalf of Gire Construction. The
remaining eight counts charged both Gire and Grayson.
Counts three and four alleged visa fraud based on the 2013
and 2014 applications, respectively. Counts five through
No. 19-1367 7
seven charged Gire and Grayson with harboring aliens in vi-
olation of 8 U.S.C. § 1324(a)(1)(A)(iii); one count each for Gar-
cia-Cruz, Lopez-Constantino, and Torres-Hernandez.
Counts eight through ten charged that Gire and Grayson
had “engaged in a practice and pattern of hiring for employ-
ment in the United States certain aliens … as specified below,
knowing that said aliens were unauthorized aliens (as defined
in [8 U.S.C. § 1324a(a)(h)(3)]), with respect to such employ-
ment.” The indictment then contained the following chart de-
picting the specific counts in violation of 8 U.S.C.
§ 1324a(a)(1)(A) and (f)(1):
COUNT ALIEN DATES
Eight C.G.-C. April 2014 to September 2014
Nine R.L.-C. April 2012 to September 2014
Ten D.T.-H. April 2008 to September 2014
Finally, the indictment alleged that the warehouse was
forfeitable to the government because it had been “used to fa-
cilitate … the commission of the offense.” 18 U.S.C. §
982(a)(6)(A)(ii)(II). The forfeiture allegations further disclosed
that, if the warehouse had been transferred or sold to a third
party, the government would be entitled to seek substitute
property. Quick Leasing, though, had already sold the ware-
house to another company in 2015, about nine months before
the indictment.
Gire told the district court at his initial appearance that he
was acting as Grayson’s authorized corporate representative.
Gire’s retained attorney then entered his appearance as coun-
sel for both defendants, and Gire pleaded not guilty to all
charges on both his and Grayson’s behalf.
8 No. 19-1367
Shortly before trial, Gire changed his and Grayson’s pleas
to guilty for counts eight to ten, the misdemeanor employ-
ment counts. A magistrate judge presided over the plea collo-
quy and issued a report and recommendation regarding the
acceptance of the plea. At the colloquy, Gire again stated, this
time under oath, that he was acting in both his individual ca-
pacity and as the corporate representative for Grayson.
The magistrate judge never inquired into Gire’s authority
as a representative. He did, however, ask the government and
defense counsel whether either had “any doubt as to defend-
ant’s competence to enter a plea today for both defendants.”
Both lawyers said they had none. The government then of-
fered a factual basis that Gire was Grayson’s president and
that he and Grayson had “knowingly continued to seasonally
employ Garcia-Cruz after his visa expired” and had known
that both Lopez-Constantino and Torres-Hernandez were not
authorized to work in the United States. Gire and counsel
agreed with this basis, and Gire pleaded guilty personally and
then as Grayson’s corporate representative. The magistrate
judge recommended that the district court accept the pleas.
After the deadline passed to object to the report and recom-
mendation, the district court did so.
On the morning of trial, Gire waived his and Grayson’s
rights to a jury trial on the remaining counts. Gire again gave
sworn testimony that he was authorized to waive Grayson’s
rights. Counsel likewise confirmed Gire’s competence to
waive both his and Grayson’s rights and submitted a signed
waiver including Gire’s signatures in both his individual ca-
pacity and as authorized representative of Grayson.
The trial lasted six days and Young testified on the defend-
ants’ behalf. She explained that she owned Grayson, but Gire
No. 19-1367 9
ran its day-to-day affairs. Her input into Grayson’s business
was “very limited.” She “knew nothing of the roofing indus-
try whatsoever” and had no knowledge of the business, cus-
tomers, or “any of that.” Gire, though, worked long hours,
seven days a week during the roofing season, as a “one-man
operation,” conducting sales, ordering materials, talking to
customers, and even driving the dump truck.
Nonetheless, Young admitted that she emailed roofing
contracts to her and Gire’s attorney in 2014 and knew they
were false. She also was aware that Gire paid workers in cash,
without collecting taxes, but did not know if they were au-
thorized to work in the United States. When pressed, how-
ever, she admitted that she knew Garcia-Cruz’s visa had ex-
pired and that he was in the United States illegally. Prior to
that, she said, Garcia-Cruz was the only H-2B visa worker
who Gire Roofing had ever legally employed. She also knew
that Grayson had pleaded guilty to unlawfully employing
Garcia-Cruz after his visa expired.
Gire and Grayson presented a joint defense. On the visa
fraud counts, the government introduced a substantial log of
emails and messages between Gire, Young, and their immi-
gration attorney regarding Grayson’s applications, as well as
the paperwork found in Young’s office. The defense tried to
explain away this evidence by asserting that one of Daley’s
associates, whom Gire and Young knew only as “Fatima,” had
prepared the applications. Fatima, in the defense’s theory,
had forged Gire’s signatures and used his and Young’s letter-
head, computers, and cell phones to create the false contracts
and the communications with their lawyer, all for Daley’s
own aims and without Gire’s knowledge.
10 No. 19-1367
On the harboring counts, they argued that the warehouse
was not intended to conceal the unauthorized aliens and
therefore could not qualify as “harboring” as defined by 8
U.S.C. § 1324. Instead, Gire and Grayson were providing them
housing only as a favor, or alternatively, as part of an arm’s-
length transaction. The defendants’ closing argument cen-
tered on the theme that they had pleaded guilty to the one
crime they were guilty of—hiring unauthorized aliens—and
they had hired them only to replace the authorized aliens who
had left because of Daley and Fatima’s machinations.
Unconvinced, the district court found Gire and Grayson
guilty of all charges. The court issued a short opinion finding
that there was no credible evidence supporting the defense’s
theory that Fatima had produced the false contracts and im-
personated Gire and Young. It concluded that the government
had carried its burden to show visa fraud: Gire had know-
ingly presented false, material statements in his visa applica-
tions. Grayson was vicariously liable for this fraud because
Gire was Grayson’s authorized agent, had acted within his
authority as its agent, and did so, at least in part, to benefit
Grayson by obtaining workers for Grayson’s business or pay-
ments from Daley.
Regarding the harboring counts, the district court con-
cluded that the government’s evidence was sufficient to prove
harboring. The court accepted that Gire and Grayson had not
sought to conceal the three aliens in the warehouse but had
offered housing as a benefit of otherwise underpaid employ-
ment. (The workers testified they worked up to 70 hours a
week and were paid between $6 and $15 an hour with no
overtime adjustments.) The court thought this, plus the fact
that living in Gire-associated properties minimized the
No. 19-1367 11
workers’ need to interact with other people—especially land-
lords that might demand documentation—sufficed to prove
that Gire had harbored them in the warehouse. Again, Gray-
son was vicariously liable for Gire’s actions. The court empha-
sized that Grayson had benefited from paying workers in
housing instead of wages, and that Young, Grayson’s owner,
had known Gire was housing the workers at the warehouse.
The government noted in closing argument that it was
seeking forfeiture but said the issue did not need to be ad-
dressed “until after the Court enters its verdicts on the
charged counts.” Thus, neither party discussed forfeiture at
length. The district court, however, found in its verdict that
the warehouse had been used to facilitate the harboring of-
fense. The court asked the government to tender a proposed
preliminary order of forfeiture reflecting this finding.
After the verdict, trial counsel moved to withdraw from
representing Gire and Grayson, who planned to obtain new
joint counsel. In doing so, he requested an extension of time
to file post-trial motions or to request a hearing regarding for-
feiture. The district court granted the motion and set a March
deadline for either party to request a hearing on the forfeiture
issue. In February, new counsel entered his appearance on be-
half of both Gire and Grayson and sought a continuance on
sentencing, but he did not request a forfeiture hearing before
the deadline passed. In May, joint counsel withdrew from his
representation of Grayson because he determined that the de-
fendants’ interests were not identical for issues of sentencing,
restitution, or forfeiture. Grayson retained its own attorney
who entered an appearance shortly thereafter. Grayson’s
counsel also did not request a forfeiture hearing.
12 No. 19-1367
The government, for its part, did not follow the district
court’s directions to file a preliminary order of forfeiture of
the warehouse. Instead, it moved for a preliminary order of
forfeiture of substitute assets. 18 U.S.C. § 982(b); 21 U.S.C.
§ 853(p). The government represented that the new owner of
the warehouse was likely a bona fide purchaser for value but
argued that the sale was “a result of an[] act or omission of the
defendant,” so it could seek a money judgment against Gray-
son and satisfy that judgment through substitute assets. 21
U.S.C. § 853(p). The government identified three such assets,
two buildings in Florida owned by Quick Leasing and a third
in Champaign, owned by Hensley Market LLC (another
Young-affiliated entity). The court entered the preliminary or-
der a few days later.
Gire and Grayson then moved separately to vacate the or-
der, arguing that they did not have anything to do with the
sale of the warehouse. They both acknowledged the court’s
finding that there was a nexus between the warehouse and the
harboring convictions, but only Gire challenged that finding.
Gire did not request a hearing on the nexus issue but did re-
quest one on the forfeiture of substitute assets. Both defend-
ants disputed the finding that Grayson owned the warehouse
and agreed that Quick Leasing had always owned it.
The government tried to salvage its request by arguing
that Quick Leasing was Grayson’s nominee. The court saw no
factual record to support this theory and vacated the prelimi-
nary order without a hearing. In doing so, it reiterated its find-
ing that there was a nexus between the harboring of aliens and
the warehouse where the aliens were harbored and concluded
that this finding was not undermined by the possibility that
Grayson did not own the warehouse. The court recognized
No. 19-1367 13
that it was required, based on its verdict, to enter a prelimi-
nary order of forfeiture, but again it did not do so.
The government then moved for a general order of forfei-
ture. See Fed. R. Crim. P. 32.2(b)(2)(C). Gire and Grayson op-
posed this request, and the district court agreed that the gov-
ernment failed to demonstrate that it could not “identify all
the specific property subject to forfeiture,” as required for a
general order. Id. This time, the court itself entered a prelimi-
nary order of forfeiture of the warehouse.
The next day, at sentencing, the district court entered the
same forfeiture as a final judgment. It sentenced Gire to three
years’ imprisonment and Grayson to three years’ probation
plus a $250,000 fine. Both defendants’ Guidelines sentencing
ranges were enhanced because Young had offered materially
false testimony in their defense. U.S.S.G. §§ 3C1.1, 8C2.5(e).
Gire and Grayson both appealed. Gire moved to stay the
consolidated appeal pending the result of his motion to vacate
his conviction, 28 U.S.C. § 2255. We denied the motion to stay,
and Gire voluntarily dismissed his appeal. (His § 2255 motion
is pending in the district court; he alleges that trial counsel
provided ineffective assistance, but his claims are largely ir-
relevant to the issues in this appeal.)
Only Grayson’s appeal remains before us, and it chal-
lenges nearly every aspect of this case. First, it contends that
the district court erred by allowing trial counsel to represent
both it and Gire, despite a perceived conflict between them.
Second, it seeks to withdraw its guilty plea on several
grounds: Gire lacked authority to plead guilty on its behalf,
the indictment was defective, the plea was involuntary, and
there was an inadequate factual basis. Third, Grayson renews
14 No. 19-1367
its argument that there was insufficient evidence to convict it
of harboring and adds that there was not enough evidence to
hold it vicariously liable for Gire’s crimes. Finally, it insists
that the forfeiture of the warehouse was entered in violation
of its due process rights. We conclude that none of these pur-
ported errors merit reversal and, therefore, affirm the judg-
ment.
II. Ineffective Assistance of Counsel
Grayson’s principal argument on appeal is that the district
court failed to explore a conflict of interest between it and Gire
before permitting trial counsel to jointly represent them. Rule
44 of the Federal Rules of Criminal Procedure obligates the
district court to “promptly inquire about the propriety of joint
representation and … personally advise each defendant of the
right to the effective assistance of counsel, including separate
representation.” Fed. R. Crim P. 44(c)(2).
The government rightly concedes error; the district court
was required to conduct a Rule 44(c) inquiry, and it failed to
do so. But we have held that a failure to follow Rule 44(c) is
not itself a reversible error. United States v. Colonia, 870 F.2d
1319, 1327 (7th Cir. 1989). That is because “neither the inquiry
nor the advice is itself the goal of the rule.” United States v.
Bradshaw, 719 F.2d 907, 915 (7th Cir. 1983) (quoting United
States v. Benavidez, 664 F.2d 1255, 1258 (5th Cir. 1982)). Rather
the rule is “prophylactic,” and a defendant seeking reversal
must show that he was denied the Sixth Amendment right to
effective counsel that the rule was designed to protect. Be-
navidez, 664 F.2d at 1258–59; see also Colonia, 870 F.2d at 1327
No. 19-1367 15
(“Rule 44(c) aims primarily at prevention of actual conflict of
interest in the joint representation case.”). 1
There are two alternative paths through which a defend-
ant who did not object to a conflict of interest can demonstrate
ineffective assistance of counsel. Blake v. United States, 723
F.3d 870, 880 (7th Cir. 2013); Hall v. United States, 371 F.3d 969,
973 (7th Cir. 2004). The first is to demonstrate that “an actual
conflict of interest adversely affected his lawyer’s perfor-
mance” under Cuyler v. Sullivan, 446 U.S. 335, 348 (1980).
An adverse effect exists if there is a “reasonable likelihood
that … counsel’s performance would have been different had
there been no conflict of interest.” Hall, 371 F.3d at 974. The
defendant must show “specific instances where [its] attorney
could have, and would have, done something different if that
attorney had represented only one defendant.” Griffin v.
McVicar, 84 F.3d 880, 887 (7th Cir. 1996) (quoting United States
v. Cirrincione, 780 F.2d 620, 630–31 (7th Cir. 1985)). Prejudice
is presumed if the defendant makes this showing. Mickens v.
Taylor, 535 U.S. 162, 173 (2002); Hall, 371 F.3d at 973.
If the defendant cannot prove there was an actual conflict,
then the alternative is to show that a potential conflict of in-
terest led counsel to provide objectively deficient representa-
tion that caused prejudice under Strickland v. Washington, 466
U.S. 668 (1984). See Blake, 723 F.3d at 880. Prejudice for Strick-
land purposes means that “there is a reasonable probability
1 The government does not address whether Grayson, as a corporation,
has a Sixth Amendment right to effective and conflict-free counsel in the
first place. See United States v. Rad-O-Lite of Phila., Inc., 612 F.2d 740, 743
(3d Cir. 1979) (holding corporation has this right). For purposes of this
appeal, we assume, without deciding, that it does have such a right.
16 No. 19-1367
that but for counsel’s unprofessional errors the trial outcome
would have been different.” Freeman v. Chandler, 645 F.3d 863,
869 (7th Cir. 2011). In other words, a reasonable probability
the defendant would have been found not guilty. Stoia v.
United States, 22 F.3d 766, 771 (7th Cir. 1994).
Grayson has not shown that there was an actual conflict
between it and Gire. “An actual conflict exists when an attor-
ney actively represents incompatible interests; it is more than
a ‘mere theoretical division of loyalties.’” United States v.
Fuller, 312 F.3d 287, 291 (7th Cir. 2002) (quoting Mickens, 535
U.S. at 171). Gire’s and Grayson’s interests were not only com-
patible—they were identical. Gire was Grayson in all but the
paperwork.
Grayson insists that it was merely “associated inde-
pendently” with Gire, who was not even its employee, let
alone its management. That is absurd and completely unsup-
ported by the record. Grayson admits, even on appeal, that
roofing was its “sole enterprise,” and there is no evidence that
it did any roofing except under Gire’s name. (Indeed, Gray-
son’s roofing contractor license was in Gire’s name.) Gire was,
in Young’s words, “a one-man operation” managing all Gray-
son’s roofing work from bidding on contracts to driving the
dump truck. He was not doing this as a volunteer. Grayson
held Gire out as its manager to the public, and the record re-
veals no other management. Young herself testified she had
nothing to do with Grayson’s business, except when she
started helping with marketing in 2014. Gire and Grayson
were one and the same. Any conflict between them is merely
theoretical.
When we asked Grayson at oral argument to identify the
conflict, counsel theorized that trial counsel had Young testify
No. 19-1367 17
with the hope of saving Gire at Grayson’s expense. Calling
Young as a defense witness might have proved unsuccessful
in hindsight, but it did not reflect a conflict. 2 Young presented
a common defense—neither Gire nor Grayson was guilty, Fat-
ima was. A common defense “often gives strength against a
common attack.” Holloway v. Arkansas, 435 U.S. 475, 482–83
(1978). This is true here; if the district court had believed
Young’s testimony regarding Fatima then it would have ac-
quitted both Gire and Grayson. Likewise, if Gire was not har-
boring aliens, as a legal matter, then neither was Grayson. Be-
cause Gire and Grayson were effectively the same, any evi-
dence that might have helped Gire would have also helped
Grayson, reflecting the compatibility of their interests.
Grayson notes the reverse is not true. It posits that uncon-
flicted counsel would have tried to pin the whole case on Gire,
on the theory that he was not working for Grayson but ex-
ploiting it. For there to be an adverse effect under Sullivan,
however, Grayson must prove that this abandoned defense
“presented a plausible alternative to the strategy actually pur-
sued at trial.” Taylor v. Grounds, 721 F.3d 809, 819 (7th Cir.
2013). Plausible does not mean winning, as the Supreme
Court has rejected the application of harmless error in the con-
text of an actual conflict. Id.Despite this low bar, Grayson falls short: its exploitation
theory is flatly implausible. No evidence supports a theory
that Gire was running a side-hustle out of his office, siphoning
money from Grayson without Young’s knowledge. His name
2 We express no opinion on whether calling Young as a witness was defi-
cient performance independent of a conflict of interest. Gire has made this
claim in his § 2255 motion, but Grayson has not raised it here.
18 No. 19-1367
was next to hers on Grayson’s bank statements, and whatever
income the company had, legitimate or otherwise, Gire had a
hand in. He publicly ran Grayson’s entire business with
Young’s blessing and out of her own home at times. The rec-
ord includes photographs of Gire Roofing trucks and equip-
ment at the warehouse, and statements from employees and
competing roofers describing Gire’s outsized role in the busi-
ness. Young deferred to Gire in running the company, asking
their immigration lawyer, in an email, “would it be okay for
me to sign it since I’m the owner?” In sum, Gire was Grayson.
There was no plausible way to demonstrate otherwise, so
Grayson cannot show an actual conflict that adversely af-
fected its defense.
Nor can Grayson prove deficient performance or prejudice
under Strickland. Grayson makes much of the fact that trial
counsel never filed a Rule 29 motion for acquittal. The gov-
ernment does not assert any sort of forfeiture of Grayson’s
rights, though, and instead accepts that Grayson has pre-
served its arguments about the sufficiency of the evidence. We
address these arguments below. Because we conclude they
are meritless there is not a “reasonable probability that … the
result of the proceeding would have been different,” Strick-
land, 466 U.S. at 694, had counsel filed a Rule 29 motion.
Grayson otherwise contends that trial counsel’s perfor-
mance was deficient because he allowed it to plead guilty for
no benefit. We address this argument in the next section, and
conclude that it, too, is meritless, in part because counsel
made the strategic decision to plead guilty to the misde-
meanor counts to bolster Grayson’s credibility on the felony
counts. It is difficult, if not impossible, to prove that a strategic
choice like this was unreasonable on a bare trial record.
No. 19-1367 19
Massaro v. United States, 538 U.S. 500, 505 (2003); United States
v. Flores, 739 F.3d 337, 339–40 (7th Cir. 2014) (recognizing that
counsel can sometimes make a reasonable strategic decision
to concede issues even over his client’s plea of not guilty).
Grayson has not shown that it was deprived of any right
to effective assistance of counsel that it may have had.
III. Guilty Plea
Grayson next asks to withdraw its guilty plea to the three
misdemeanor counts of hiring unauthorized aliens as part of
a pattern or practice, 8 U.S.C. § 1324a(a)(1)(A), (f)(1). It could
have moved in the district court to withdraw its plea at any
time before sentencing, which occurred nine months after it
obtained separate counsel. Fed. R. Crim. P. 11(d)(2)(B). It
never did, though, so we review its arguments now only for
plain error. United States v. Vonn, 535 U.S. 55, 59 (2002); United
States v. Zacahua, 940 F.3d 342, 344 (7th Cir. 2019).
To show plain error, a defendant has the burden of meet-
ing four elements. First, it must prove “that an error actually
occurred, not merely that an error might have occurred.”
United States v. Williams, 931 F.3d 570, 573 (7th Cir. 2019). Sec-
ond, the error must be plain—i.e., clear or obvious—it cannot
be “subtle, arcane, debatable, or factually complicated.”
United States v. Pierson, 925 F.3d 913, 922 (7th Cir. 2019) (quot-
ing United States v. Turner, 651 F.3d 743, 748 (7th Cir. 2011)).
Third, the error must have affected its substantial rights,
which requires here that the defendant “show a reasonable
probability that, but for the error, he would not have entered
the plea.” Zacahua, 940 F.3d at 345 (quoting United States v.
Dominguez Benitez, 542 U.S. 74, 76 (2004)). If those three con-
ditions are met, we may correct the error, if, in our discretion,
20 No. 19-1367
we conclude it would “seriously affect[] the fairness, integrity
or public reputation of judicial proceedings.” Rosales-Mireles
v. United States, 138 S. Ct. 1897, 1905 (2018). Though Grayson
identifies numerous potential errors, none satisfies these four
requirements.
A. Gire’s Authority to Plead Guilty
Grayson primarily contends that the district court erred in
accepting its guilty plea from Gire. The magistrate judge who
conducted the colloquy never inquired into the basis for
Gire’s authority to plead guilty on behalf of Grayson. The
judge asked only whether Gire, who was under oath, was
there as a representative of the corporation. Gire confirmed
that he was. The magistrate judge might understandably have
been complacent, having a man named Gire pleading guilty
on behalf of a company that the case caption listed as Grayson
Enterprises d/b/a Gire Roofing. The government also compli-
cated things when it represented in its factual basis that Gire
was Grayson’s president, a point to which both Gire and de-
fense counsel agreed.
The magistrate judge should have engaged in a more
searching inquiry to confirm Gire’s authority to plead guilty
on behalf of Grayson. The Federal Judicial Center’s Bench-
book for District Court Judges recommends that a corporate
representative’s authority to plead guilty be the first thing the
judge confirms during a plea colloquy for an organizational
defendant. Fed. Judicial Ctr., Benchbook for U.S. District
Court Judges § 2.02 at 75 (6th ed. 2013),
https://www.fjc.gov/sites/default/files/2014/Benchbook-US-
District-Judges-6TH-FJC-MAR-2013.pdf. It suggests more
than confirming the defendant’s presence as a representative
No. 19-1367 21
and advises the court to verify even that a board of directors
has passed a valid resolution permitting the plea. Id.
Of course, there is no reason to believe that Grayson had a
board of directors that failed to authorize the plea. (And in
any event, the Benchbook is only useful guidance, not binding
law. See, e.g., United States v. Egwaoje, 335 F.3d 579, 585 (7th
Cir. 2003).) Rather, Grayson listed only Young as its nominal
president and sole officer. Grayson insinuates but does not
outright argue that she was the only one who could have
pleaded guilty on Grayson’s behalf. Consistent with this mere
insinuation, it cites no authority for the proposition that only
a president or other officer can plead guilty on behalf of a cor-
poration.
Gire’s lack of a title does not alone mean that he was not
duly authorized to plead guilty for Grayson. We may consider
the entire record when reviewing for plain error, Vonn, 535
U.S. at 74, and what we see establishes that Gire was empow-
ered to plead guilty on Grayson’s behalf. Young’s trial testi-
mony reveals that Gire had effectively unlimited authority as
Grayson’s de facto manager. He regularly entered contracts
on Grayson’s behalf with minimal oversight. (Young would
sign some contracts, but she never read them because she
knew nothing about roofing.) At the colloquy itself, Gire and
defense counsel both asserted to the court that Gire had au-
thority to represent Grayson. Grayson never objected to these
assertions, either in response to the magistrate judge’s recom-
mendation or after obtaining separate counsel (and after
Young testified under oath she was aware of the plea). If it had
other evidence to imply that Gire was exceeding his authority,
then it could have produced it at that point. It did not do so,
and that is enough to resolve this argument for our purposes.
22 No. 19-1367
On plain-error review, it is Grayson’s burden to prove that an
error actually occurred, it cannot rest on the mere possibility
one did. Williams, 931 F.3d at 573.
Grayson insists that it was not present at the plea colloquy,
but even were that true, it would not be an error. The Federal
Rules of Criminal Procedure provide that an organizational
defendant need not be present if represented by counsel who
is present. Fed. R. Crim. P. 43(b)(1). Grayson was represented
at the colloquy by counsel. That key fact distinguishes this
case from United States v. Cocivera, 104 F.3d 566 (3d Cir. 1996),
on which Grayson relies. There, a 50% owner of six corpora-
tions was tried alongside the corporations but elected at the
last minute to proceed pro se. Id. at 569. The Third Circuit was
concerned about a conflict and thought there was no evidence
that the partial owner had unilateral authority to fire counsel,
but it did not reach these issues because there was a bigger
problem: corporations can appear in court only through a
lawyer. Id. at 573; see also Rowland v. Cal. Men's Colony, 506 U.S.
194, 201–02 (1993). Even if the owner had authority to fire
counsel, he could not then represent the corporations in coun-
sel’s stead. Here, it is uncontested that Grayson was repre-
sented by it and Gire’s joint counsel.
B. Indictment
Next, Grayson argues that its plea was invalid as it was
based on a defective indictment. Because it did not object in
the district court, “the indictment ‘is immune from attack un-
less it is so obviously defective as not to charge the offense by
any reasonable construction.’” United States v. Franklin, 547
F.3d 726, 730 (7th Cir. 2008) (quoting United States v. Smith,
223 F.3d 554, 571 (7th Cir. 2000)).
No. 19-1367 23
Grayson pleaded guilty to three counts under 8 U.S.C.
§ 1324a(f)(1), which provides that
[a]ny person or entity which engages in a pattern or
practice of violations of subsection (a)(1)(A) or (a)(2)
shall be fined not more than $3,000 for each unauthor-
ized alien with respect to whom such a violation oc-
curs, imprisoned for not more than six months for the
entire pattern or practice, or both ….
Section 1324a(a)(1)(A), in turn, states “[i]t is unlawful for a
person or other entity … to hire, or to recruit or refer for a fee,
for employment in the United States an alien knowing the al-
ien is an unauthorized alien.”
Grayson’s first objection is jurisdictional: it contends that
the indictment did not even charge a crime at all. In its view,
hiring an unauthorized alien is merely a civil wrong subject
to civil remedies under 8 U.S.C. § 1324a(e)(4). But the indict-
ment was not based on subsection (e)(4). Instead, it charged
Grayson with a practice and pattern of hiring unauthorized
aliens under § 1324a(f)(1), entitled “[c]riminal penalty.” The
indictment thus alleged an “offense[] against the law of the
United States,” as required for the district court to have sub-
ject-matter jurisdiction. 18 U.S.C. § 3231. The mere existence
of parallel civil remedies does not deprive the court of juris-
diction over an alleged criminal offense.
Grayson next asserts that the indictment fails to state an
offense. According to Grayson, the indictment relies on an as-
sumption that hiring a single alien is a pattern or practice, and
Grayson was therefore guilty of three such patterns or prac-
tices. Even if true, this does not invalidate the plea. To the con-
trary, by pleading guilty, Grayson waived its opportunity to
24 No. 19-1367
seek dismissal of the indictment for failure to state an offense.
See United States v. Wheeler, 857 F.3d 742, 744 (7th Cir. 2017)
(citing Fed. R. Crim. P. 12(b)(3)(B)(v)), cert. denied, 138 S. Ct.
640 (2018). Regardless, Grayson’s reading of the indictment is
nonsense. It charged Grayson with engaging in “a practice
and pattern,” in the singular, and used that phrase one time.
The government likewise stated at the plea colloquy that it
could prove Grayson engaged “in a pattern or practice.” At no
point did anyone contend that Grayson was guilty of three
patterns or practices, only three counts of hiring aliens that
combined to one practice. Grayson cannot demonstrate plain
error by putting words in the government’s mouth.
Taking the opposite tack, Grayson raises a multiplicity ar-
gument: the indictment charges a single crime—the pattern or
practice—in three counts. It has waived this argument as well.
Federal Rule of Criminal Procedure 12(b)(3)(B)(ii) requires
that a defendant raise a multiplicity objection by a pretrial
motion. Failure to do so, or to explain why there was good
cause for that failure, means we “do not conduct even plain
error review.” United States v. Lockett, 859 F.3d 425, 428 (7th
Cir. 2017).
Even if we were to review the record for plain error, it is
not clear or obvious that the indictment was defective. Gray-
son insists that the pattern or practice is a single crime that
must be charged in a single count, but cites no authority hold-
ing as much. Nor have we found any. In resolving a multiplic-
ity objection, we look to the statute to determine “what the
allowable ‘unit’ of prosecution is—the minimum amount of
activity for which criminal liability attaches.” United States v.
Corrigan, 912 F.3d 422, 428 (7th Cir. 2019) (quoting United
States v. Ajayi, 808 F.3d 1113, 1123 (7th Cir. 2015)).
No. 19-1367 25
Grayson and the government each offer interpretations of
what that unit is here. Grayson argues that a person can be
imprisoned for six months “for the entire pattern or practice,”
and that only that single pattern or practice can be a crime
and, hence, a unit of prosecution. 8 U.S.C. § 1324a(f)(1). The
government instead emphasizes that the $3,000 fine (the only
penalty Grayson faced) is assessed “for each unauthorized al-
ien,” implying the unit is the hiring of an alien. Id. Each party
dismisses the other’s reading as a sentencing provision. We
do not need to decide who is right. Both interpretations are
plausible, so Grayson loses. To prove a plain error, its reading
must not only be the better one, it must be “clearly (‘plainly’)
correct.” Lockett, 859 F.3d at 429.
C. Voluntariness
Grayson next challenges its plea as involuntary. It first
contends that it was not told what qualifies as a “pattern or
practice.” The government stated at the plea colloquy that it
would have needed to prove that the defendants “engaged in
a pattern or practice of … hiring aliens for unlawful employ-
ment” but left that phrase undefined. Perhaps it could have
clarified that “pattern or practice” means “regular, repeated,
and intentional activities, but does not include isolated, spo-
radic, or accidental acts.” 8 C.F.R. § 274a.1(k).
Assuming this omission was an obvious error, the regula-
tory definition is hardly technical, and the record reveals no
reason to believe that Grayson’s hiring of unauthorized aliens
was isolated, sporadic, or accidental. All Grayson offers is that
it hired each alien at different times, but it does not explain
how this is incompatible with the regulatory or any definition
of “pattern or practice.” Grayson has not established that
there is a reasonable probability it would not have pleaded
26 No. 19-1367
guilty had the court told it the regulatory definition.
Dominguez Benitez, 542 U.S. at 83; Franklin, 547 F.3d at 732.
Grayson insists also that its plea was involuntary because
it received no benefit from the plea and was prejudiced by the
fact that it had effectively admitted three of the elements of
the harboring counts. In addition to the pattern or practice el-
ement, the plea colloquy included admissions that Grayson
hired the persons named in the indictment, those persons
were aliens, and that it knew they were unauthorized to un-
dertake employment. The harboring counts required the gov-
ernment to prove at trial that Grayson harbored the persons
named, they were unauthorized aliens, and Grayson knew or
recklessly disregarded that they were not lawfully in the
United States.
Given the substantial overlap between these elements, the
government argued at trial that the guilty plea was “fairly
conclusive evidence” that Gire knew that the aliens were not
lawfully in the United States, and harboring was thus the only
element in dispute. Since Grayson, as a corporation, did not
face imprisonment for these counts, it argues that the court
should have stopped it from conceding part of the govern-
ment’s case for what it sees as no gain.
Again, even if we assume this was an error, Grayson has
not shown an effect on its substantial rights. The government
did not rely only on the plea at trial; it introduced evidence
that Gire and Grayson knew or recklessly disregarded the fact
that Garcia-Cruz, Torres-Hernandez, and Lopez-Constantino
were in the country illegally. All three men testified that they
either believed Gire knew they were unauthorized or that he
never asked, and each said he paid them under the table. The
district court, likewise, did not rest its findings on the plea and
No. 19-1367 27
found that the undisputed evidence at trial proved Gire and
Grayson’s knowledge beyond a reasonable doubt. Grayson’s
guilty plea conceded the obvious, and its closing argument at
trial shows that it did so to bolster its defense to the other
counts. That this strategy failed is not enough, by itself, to
demonstrate plain error. See United States v. Austin, 907 F.3d
995, 1000 (7th Cir. 2018) (finding no plain error when defend-
ant pleaded guilty and received no sentencing benefits).
D. Factual Basis
Grayson finishes off its challenges to its guilty plea by con-
testing the factual basis for count eight—its hiring of Garcia-
Cruz as an unauthorized alien. The government explained at
the plea colloquy that Garcia-Cruz received an H-2B visa
based on Grayson’s 2013 petition and that his visa expired in
November 2013. From this, Grayson infers that it could not
have illegally hired Garcia-Cruz, only illegally continued to
employ him after hiring. That is a different crime. Compare 8
U.S.C. § 1324a(a)(1)(A), with id. § 1324a(a)(2). But see id.
§ 1324a(f)(1) (treating both subsections identically). The gov-
ernment contests this reading of the colloquy. It specified that
Grayson had “knowingly continued to seasonally employ Gar-
cia-Cruz after his visa expired,” so it suggests that Grayson
rehired Garcia-Cruz based on the roofing season, which runs
from the end of March to November.
The government should have made its theory clearer at the
plea colloquy. Still, the entire record supports its explanation,
which is enough to defeat Grayson’s challenge. See Vonn, 535
U.S. at 74; United States v. Arenal, 500 F.3d 634, 638–39 (7th Cir.
2007). The indictment alleged that Grayson hired Garcia-Cruz
in April 2014, after his visa had expired and consistent with
28 No. 19-1367
the beginning of a new roofing season. 3 Garcia-Cruz also ex-
plained at trial that he did welding work for Gire over the
winter, instead of roofing. This testimony supports that he re-
mained a Grayson employee (he said that he “continued” to
work for Gire) but it also supports that Gire hired him per-
sonally after letting him go as a Grayson employee. This dis-
tinction is too subtle to be a plain error. A defendant cannot
sit silent before the district court and wait for appeal to quib-
ble with the factual details underlying its plea. Indeed, “[i]t is
precisely this type of sandbagging that the heightened stand-
ard of plain error review is well-served to prevent.” Arenal,
500 F.3d at 639.
We conclude that Grayson has not demonstrated that the
district court plainly erred in accepting the guilty plea.
IV. Sufficiency of the Evidence
Grayson next challenges the sufficiency of the evidence. Its
first argument is the only one raised on appeal that was also
raised in the district court—it contends that there was no evi-
dence that it harbored the aliens. Grayson also argues that the
government failed to prove that it was vicariously liable for
Gire’s crimes.
3 In contrast, the indictment alleged that Grayson and Gire hired the other
two aliens in 2008 and 2012, because they were never here legally. Grayson
noted for the first time at oral argument that the indictment charged it
with hiring Torres-Hernandez before its incorporation in 2011. Even if not
waived, we do not think this argument rises to the level of plain error; the
government specified that Gire seasonally employed Torres-Hernandez,
too. We can also reasonably construe the indictment to allege that Gire
hired him in 2008 and Grayson stepped into that employment relationship
when it took over the Gire Roofing name and business.
No. 19-1367 29
“In considering a challenge to the sufficiency of the evi-
dence, we examine the evidence ‘in the light most favorable
to the government, drawing all reasonable inferences in the
government’s favor.’” United States v. George, 900 F.3d 405, 409
(7th Cir. 2018) (quoting United States v. Patel, 778 F.3d 607, 619
(7th Cir. 2015)). We will affirm the conviction “unless, after
thus viewing the evidence in favor of the government, no ra-
tional trier of fact could have found the essential elements of
the offense beyond a reasonable doubt.” Id.; see also Jackson v.
Virginia, 443 U.S. 307, 319 (1979). We have described this bur-
den as “nearly insurmountable.” United States v. Faulkner, 885
F.3d 488, 492 (7th Cir.), cert. denied sub nom. Sykes v. United
States, 139 S. Ct. 260 (2018), and cert. denied, 139 S. Ct. 388(2018). Grayson has not surmounted it.
A. Harboring
8 U.S.C. § 1324(a)(1)(A)(iii) provides criminal sanctions for
[a]ny person who … knowing or in reckless disregard
of the fact that an alien has come to, entered, or remains
in the United States in violation of law, conceals, har-
bors, or shields from detection, or attempts to conceal,
harbor, or shield from detection, such alien in any
place, including any building or any means of trans-
portation.
The statute does not define what it means to harbor an alien,
but we have understood the word to “plug[] a possible loop-
hole left open by merely forbidding concealing and shielding
from detection.” United States v. Costello, 666 F.3d 1040, 1045
(7th Cir. 2012).
To explain, we offered a hypothetical: the owner of a res-
taurant employs known unauthorized aliens, pays them low
30 No. 19-1367
wages, and provides them housing to make their underpaid
employment attractive and because they lack documentation.
The owner is harboring these illegal aliens in the sense
of taking strong measures to keep them here. Yet there
may be no effort at concealment or shielding from de-
tection …. It is nonetheless harboring in an appropriate
sense because the illegal status of the alien is insepara-
ble from the decision to provide housing—it is a deci-
sion to provide a refuge for an illegal alien because he’s
an illegal alien.
Id. The defendant in Costello merely allowed her unauthor-
ized-alien boyfriend to live with her, so she was not “harbor-
ing” within the meaning of the statute. Id.We applied this hypothetical in United States v. McClellan,
794 F.3d 743 (7th Cir. 2015). McClellan ran a restaurant that
had several unauthorized alien employees who lived rent-free
in a house he owned across the street. Id. at 746–47. He was
convicted of harboring aliens in the house and argued on ap-
peal that the evidence was insufficient to convict because the
employees’ alien statuses were not “the driving purpose for
the provision of shelter.” Id. at 750. We rejected this argument
because there was “evidence that providing the illegal work-
ers with housing and utilities enabled the workers to avoid
detection by authorities and enabled Mr. McClellan to con-
tinue to employ them at low wages, keep up his profit mar-
gins, and lessen his employment tax burdens.” Id. From this,
we concluded, a jury could infer that McClellan “intended to
safeguard his employees from the authorities.” Id. at 751.
This case appears materially indistinguishable from
McClellan. The district court agreed and cited McClellan in
No. 19-1367 31
concluding there was enough evidence to infer that “[b]y giv-
ing the aliens a place to live, Gire safeguarded the aliens from
the authorities by making it more difficult for the authorities
to locate them.” Despite this obvious overlap, the district
court’s reliance on the case, and the parties’ thorough discus-
sion of it in the district court proceedings, Grayson’s briefs do
not even cite McClellan. When we asked Grayson how it could
distinguish it at oral argument, counsel responded that
McClellan’s actions were more egregious because he was
“hiding the people in the back” of the restaurant. To the con-
trary, McClellan harbored aliens in a house across the street;
it was Grayson that kept them inside its warehouse.
Grayson primarily separates itself from the hypothetical
in Costello (and by extension McClellan) on the grounds that it
did not underpay its workers. It concedes that it paid less than
the “prevailing wage” that the Department of Labor provides
for H-2B visa purposes but counters that it paid over the min-
imum wage and in accordance with the market for roofing la-
borers.
Underpayment is not an element of § 1324. Our reasoning
in Costello and McClellan did not depend on a precise deter-
mination whether unauthorized alien employees were paid
less than any given wage—prevailing, market, or otherwise.
We used the fact that the employees were given housing and
paid a relatively low wage to infer that the offer of housing
was “a decision to provide a refuge for an illegal alien because
he’s an illegal alien.” Costello, 666 F.3d at 1045. Regardless of
how much Grayson paid its workers, it still employed them
for less than it could authorized aliens or United States citi-
zens because it never paid employment taxes or insurance on
the three aliens’ behalf. McClellan, 794 F.3d at 750. That benefit
32 No. 19-1367
to Grayson suffices to connect the offer of housing to the fact
that they were unauthorized aliens and distinguishes Gray-
son from a defendant that merely houses a person who it
knows happens to be an unauthorized alien.
Similarly, the district court’s finding that Grayson har-
bored the aliens is not inconsistent with the fact that Gire
overcharged the aliens rent for their rooms. Grayson insists
this is evidence of a financial transaction as opposed to har-
boring, but we view the evidence in the light most favorable
to the government, not to Grayson. See George, 900 F.3d at 409.
In that light, we do not see an arm’s-length housing arrange-
ment, but rather Gire’s double-dipping on his exploitation of
the aliens he was harboring. Again, though we noted the offer
of free housing in the Costello hypothetical and in McClellan,
that does not make the lack of rent an element of the offense.
It just strengthens the inference of an intent to safeguard al-
iens because they are unauthorized.
As we said in McClellan, the key question for a harboring
case under § 1324(a)(1)(A)(iii), divorced of hypotheticals and
factual specifics, is whether there is “evidence from which a
jury could conclude, beyond a reasonable doubt, that the de-
fendant intended to safeguard th[e] alien from the authori-
ties.” 794 F.3d at 751. One can infer that intent through evi-
dence of underpayment or free housing, id., but that is not the
only evidence the government can use to prove it.
The district court could rationally infer an intent to safe-
guard here from the simple fact that Grayson housed known
unauthorized alien employees inside its warehouse. This lo-
cation, even more than the house across the street in McClel-
lan, “minimized the illegal employees’ exposure to the gen-
eral public … and prevented them from engaging in other
No. 19-1367 33
commercial transactions, which may have exposed their ille-
gal status.” Id. In minimizing these risks, Grayson harbored
aliens “in the sense of taking strong measures to keep them
here.” Costello, 666 F.3d at 1045. Garcia-Cruz and Lopez-Con-
stantino even testified that Gire asked them to move into the
warehouse from their prior apartments once he and Young
stopped owning those apartments (perhaps risking a different
landlord inquiring into their statuses).
Though Gire also permitted at least one authorized alien
worker to move into the warehouse, that worker testified that
Gire said he could not remain there long “because [the ware-
house] was not a place for residency to stay, it was a place to
work.” The district court could reasonably infer from this tes-
timony that “the illegal status of the alien [was] inseparable
from the decision to provide housing.” Id. at 1045. 4
It is difficult to imagine a factual scenario any further away
from the concerns we had in Costello about the government
using § 1324 to reach a doctor in an emergency room, a child
hosting a sleepover, a family of unauthorized aliens living in
their own home, or Costello herself, cohabitating with her
4 In McClellan, we rejected an argument that housing authorized aliens
alongside unauthorized ones defeats a charge under § 1324. 794 F.3d at
751 n.19 (“The fact that Mr. McClellan was not harboring other aliens,
however, does not diminish the evidence that, with respect to illegal aliens
employed … the provision of housing and utilities close to the workplace
significantly diminished the likelihood that they would be discovered and
concomitantly benefitted Mr. McClellan's business endeavors.”). Grayson
did not raise an argument along these lines in its briefs, though it did in
the district court and at oral argument. Even if not waived, this argument
fails for the reasons we gave in McClellan.
34 No. 19-1367
boyfriend. Id. at 1044, 1047. We have instead here, like our res-
taurant hypothetical, “a perfect case of harboring.” Id. at 1049.
B. Respondeat Superior
Grayson next challenges the district court’s finding that it
was vicariously liable for Gire’s actions on a respondeat supe-
rior theory. To prove Grayson’s liability, the government
needed to prove beyond a reasonable doubt that (1) an offense
was committed by Grayson’s agent, (2) in committing the of-
fense, the agent intended, at least in part, to benefit Grayson,
and (3) the agent acted within his authority. See United States
v. Oceanic Illsabe Ltd., 889 F.3d 178, 195 (4th Cir. 2018); United
States v. One Parcel of Land Located at 7326 Highway 45 N., 965
F.2d 311, 316 (7th Cir. 1992); Seventh Circuit Pattern Criminal
Jury Instruction 5.03 (2018).
We have already explained that sufficient evidence sup-
ported Gire’s conviction for harboring, and Grayson does not
dispute Gire’s conviction for visa fraud. Though Grayson tries
to distance itself from Gire, it does not go so far as to argue
that Gire was not within the scope of his role as “de facto man-
ager” when he petitioned for and harbored Grayson employ-
ees. The evidence more than supports that he was. Young tes-
tified she was aware Gire sought H-2B workers in 2013 and
all but one had left, petitioned for workers again in 2014, used
false contracts to do so, and housed employees in the ware-
house. Even without that testimony, the communications be-
tween Gire, Young, and their lawyer show her awareness of
and acquiescence in Gire’s seeking H-2B workers, and all
three aliens testified as to her knowledge of their living ar-
rangements. The only disputed element is whether Gire acted
to benefit Grayson.
No. 19-1367 35
Grayson contends that all the evidence showed benefit
only to Gire, not Grayson: Gire collected the rent from the
workers directly, and he received the wire transfers from Da-
ley. Except that last part is not even true. Young received the
$4,000 wire transfer from Daley based on the 2013 visa fraud
(the only successful petition for which Grayson was con-
victed). Grayson does not grapple at all with this incon-
sistency, but simply insists that a benefit to Gire is not a ben-
efit to Grayson and that Gire was exploiting the company. We
explained above why this theory is not only dubious but im-
plausible. Nevertheless, we can assume for the sake of argu-
ment that Gire and Grayson are separate. There was still suf-
ficient evidence that Gire committed these crimes at least in
part to benefit Grayson.
As that italicized phrase makes clear, not all the benefits of
the crime need to go to a corporation for it to be held crimi-
nally liable for its agents’ actions. “Corporate liability can also
arise ‘if the employee or agent has acted for his own benefit as
well as that of his employer.’” Oceanic Illsabe, 889 F.3d at 195
(quoting United States v. Singh, 518 F.3d 236, 250 (4th Cir.
2008)). As the district court explained, “Gire requested the H-
2B visa workers for Grayson Enterprises.” Regardless of what
Gire gained from his fraud, Grayson benefited by obtaining at
least one employee—Garcia-Cruz. Grayson paid Garcia-Cruz
without withholding employment taxes, and Gire harbored
him in the warehouse to protect this arrangement, increasing
Grayson’s profits. McClellan, 794 F.3d at 750. We can infer sim-
ilar intent to benefit Grayson for the 2014 visa fraud; the only
reason we cannot point to a concrete benefit is because Gire
was caught. Viewed in the light most favorable to the govern-
ment, this evidence is sufficient to hold Grayson vicariously
liable for Gire’s crimes.
36 No. 19-1367
V. Forfeiture
Finally, Grayson argues that the district court’s forfeiture
order deprived it of property (the warehouse) without due
process of law, or, alternatively, was improperly entered be-
cause Grayson never owned the warehouse.
“The core of due process is the right of notice and the op-
portunity to be heard.” United States v. Segal, 432 F.3d 767, 776
(7th Cir. 2005). Grayson here had both. The government and
district court notified Grayson that the warehouse was subject
to forfeiture before the court entered the preliminary order.
The indictment included the necessary forfeiture notice. Fed.
R. Crim. P. 32.2(a). The district court also found in its verdict
that there was a nexus between the harboring offense and the
warehouse, which had been used to facilitate the harboring.
It then reiterated this finding when it vacated the order for-
feiting substitute assets.
Grayson contends this was not enough notice, because the
government never moved for a preliminary order of forfeiture
of the warehouse. The alternative motions seeking substitute
assets or general forfeiture, it insists, waived the govern-
ment’s right to seek forfeiture of the warehouse itself.
We do not see how the government’s actions undermine
the notice Grayson had that its rights to the warehouse (what-
ever they may be) were at risk of being forfeited. Rather than
showing an “intentional relinquishment or abandonment,” as
required for us to find waiver, United States v. Olano, 507 U.S.
725, 733 (1993) (quoting Johnson v. Zerbst, 304 U.S. 458, 464
(1938)), these motions demonstrate that the government
wanted to seek forfeiture of the warehouse but believed
(rightly or wrongly) that it would not be able to enforce such
No. 19-1367 37
an order without obtaining additional relief. The indictment
asserted the government’s alternative right to seek substitute
assets if it concluded that the warehouse had been trans-
ferred. The government did not waive one right by seeking to
enforce the other.
In any event, the government did not need to move to en-
force its right to forfeiture of the warehouse. The district court
had already found that the warehouse was subject to forfei-
ture, so there was nothing more to do. All the court needed at
that point was to “promptly enter a preliminary order of for-
feiture,” Fed. R. Crim. P. 32.2(b)(2)(A). It could have done so
without asking for a proposed order from the government.
The government should have tendered that preliminary order
to the district court shortly after the verdict, as the court re-
quested. The government could have then moved to modify
that order to seek substitute assets or general forfeiture. Fed.
R. Crim. P. 32.2(e). What happened here was more compli-
cated, but we see no practical difference that would rise to the
level of a due process violation.
Grayson also had an opportunity to be heard: the six-day
trial that led to the nexus finding in the verdict. The Federal
Rules of Criminal Procedure allow a district court to make a
forfeiture determination based on evidence already in the
court’s record, Fed. R. Crim. P. 32.2(b)(1)(B). Grayson pro-
vides no reason to believe this approach was improper here.
We have already concluded that there was enough evidence
to prove beyond a reasonable doubt that Grayson harbored
aliens in the warehouse. Forfeiture required finding—by only
a preponderance of the evidence, United States v. Smith, 770
F.3d 628, 637 (7th Cir. 2014)—a nexus between the warehouse
and the harboring and that the warehouse was “used to
38 No. 19-1367
facilitate” or was “intended to be used to facilitate,” the har-
boring, 18 U.S.C. § 982(a)(6)(A)(ii).
Grayson maintains it was entitled to a separate hearing on
forfeiture because the government promised one in its closing
argument at trial. This promise did not bind the district court,
which, in any event, offered Grayson an extension of time to
seek an evidentiary hearing after the verdict and its nexus
finding. See Fed. R. Crim. P. 32.2(b)(1)(B) (requiring separate
hearing “on either party’s request”). Grayson never requested
one, though. It says in its reply brief that “the defense ex-
pressly invoked its hearing rights” but points only to papers
in which Gire requested a hearing through his counsel. Gray-
son cannot treat its interests as identical to Gire’s only when
convenient for it (and only after the point when it told the dis-
trict court that they were different). In any event, Gire’s re-
quest related not to the nexus determination, but to the forfei-
ture of substitute assets. Gire and Grayson were not preju-
diced when the court vacated that order. In fact, they received
the relief they requested.
Finally, the district court rightly recognized that the pos-
sibility Grayson might not own the warehouse was not a rea-
son to withhold a forfeiture order. The Federal Rules of Crim-
inal Procedure require the district court to enter a preliminary
order of forfeiture “without regard to any third-party’s inter-
est in the property.” Fed. R. Crim. P. 32.2(b)(2)(A). Likewise,
the substantive forfeiture provision applicable here, 18 U.S.C.
§ 982(a)(6)(A)(ii)(II), permits forfeiture of “any” property
“that is used to facilitate … the commission of the offense of
which the person is convicted.” This language encompasses
assets held in the name of third parties, but the initial nexus
determination addresses only whether the property subject to
No. 19-1367 39
forfeiture is related to the defendants’ criminal activities. A
third party’s interest is not implicated in this initial nexus de-
termination. See United States v. Grossman, 501 F.3d 846, 849
(7th Cir. 2007) (interpreting 21 U.S.C. § 853(c), applicable here
through 18 U.S.C. § 982(b)(1)); see also De Almeida v. United
States, 459 F.3d 377, 381 (2d Cir. 2006) (“[C]riminal forfeiture
is not a measure restricted to property owned by the criminal
defendant ….”).
A third party can, however, raise an interest in the prop-
erty in an ancillary proceeding. 21 U.S.C. § 853(n). Specifi-
cally, Federal Rule of Criminal Procedure 32.2(c) allows third
parties to file petitions asserting their interests in property to
be forfeited. A final judgment of forfeiture for Grayson or
Gire does not adjudicate any third parties’ rights to the ware-
house until the ancillary proceeding is completed. Fed. R.
Crim. P. 32.2(b)(4)(A). Here, the judgment itself states only
that “the defendant shall forfeit the defendant’s interest.” If
Grayson has no interest, then it has not forfeited a thing, but
whatever interest it has, it has forfeited. Perhaps the district
court will find that a third party has a stronger claim to the
warehouse than the government; regardless, the forfeiture
gives the government a better claim than Grayson.
VI. Conclusion
Although Grayson identifies numerous potential errors in
the proceedings leading to its conviction, it has not convinced
us that any is cause for reversal. The judgment of the district
court is, therefore,
AFFIRMED.