### In the



# United States Court of Appeals

For the Seventh Circuit

____________________

No. 16

‐ 2034

U NITED S TATES OF A MERICA

, Plaintiff

‐ Appellee

,

v.

A VALON B ETTS

‐ G ASTON

, Defendant

‐ Appellant

.

____________________

Appeal from the United States District Court for the

Northern District of Illinois, Eastern Division.

No. 11 CR 502

‐ 1

— Charles R. Norgle

, Judge

.

____________________

A RGUED F EBRUARY 15, 2017

— D ECIDED J UNE 20, 2017

____________________

Before B AUER

, E ASTERBROOK

, and H AMILTON

, Circuit

Judges

.

H AMILTON

, Circuit Judge

. Defendant Avalon Betts

‐ Gaston

was convicted at trial on two counts of wire fraud. In this ap

‐ peal, she raises numerous challenges to both her convictions

and sentence. We affirm the convictions and sentence.2 No. 16

‐ 2034

I. Factual and Procedural Background

Betts

‐ Gaston challenges the sufficiency of the evidence, so

we recount the facts in the light most favorable to the govern

‐

ment. United States v. Morris

, 576 F.3d 661, 666 (7th Cir. 2009),

citing United States v. Richardson

, 208 F.3d 626, 631 (7th Cir.

2000).

Avalon Betts

‐ Gaston and co

‐ defendant Dimona Ross to

‐ gether formed a company that operated a scheme to defraud

homeowners and mortgage lenders. Betts

‐ Gaston and Ross

found homeowners facing foreclosure and convinced them to

participate in what the defendants said was a program to help

them keep their homes. Betts

‐ Gaston had the homeowners

sign documents that deeded their homes to a trust the defend

‐

ants controlled. Ross then arranged for straw buyers to obtain

mortgages to buy the homes. Working with Betts

‐ Gaston, she

filled out loan applications that inflated the buyers’ incomes

and misrepresented the purpose of the purchases. Once a sale

was completed, the buyer deeded the property back to the de

‐

fendants’ trust. When the dust on these transactions settled,

the defendants had both the mortgage proceeds and title to

the properties. The homeowners initially still lived in the

homes but no longer had title to them or equity in them. At

least two homeowners were eventually evicted.

At trial the government offered evidence of three such

transactions, which we refer to according to the streets where

the homes were located: the Ravengate property, the Trum

‐

bull property, and the Howard property. Ross’s mother was

the straw buyer for the Ravengate and Howard properties;

Betts

‐ Gaston’s father played that role for the Trumbull prop

‐

erty.No. 16

‐ 2034 3

Betts

‐ Gaston and Ross were indicted for this scheme in

2011. Count I described the scheme, identified the Trumbull

and Howard transactions as part of the scheme, and charged

both defendants with wire fraud in connection with wiring

the mortgage funds for the Trumbull transaction. Count II

charged the defendants with wire fraud in connection with

wiring mortgage funds for the Howard property.

Ross pled guilty and agreed to cooperate with the govern

‐

ment. Betts

‐ Gaston proceeded to a jury trial at which the gov

‐

ernment presented evidence of the Howard, Ravengate, and

Trumbull transactions. She was convicted on both counts. A

fourth transaction, called the Hermosa transaction, was intro

‐

duced at sentencing. Betts

‐ Gaston was ultimately sentenced

to a fifty

‐ seven month term in prison.

II. Challenges to the Convictions

Betts

‐ Gaston challenges her convictions on five grounds:

(A) the government concealed the terms of its plea agreement

with her co

‐ defendant, in violation of its Brady obligations; (B)

the district court’s limited questioning of prospective jurors

violated her right to an impartial jury; (C) evidence on the ma

‐ teriality of her misrepresentations was excluded, impairing

her right to present a defense; (D) insufficient evidence sup

‐ ported her conviction on Count II; and (E) the district judge

was hostile to her in front of the jury, impairing her right to a

fair trial.

A. Compliance with Brady

Brady v. Maryland

, 373 U.S. 83 (1963), “requires the govern

‐

ment to disclose evidence materially favorable to the ac

‐

cused,” including “evidence that tends to impeach a govern

‐

ment witness.” United States v. Salem

, 578 F.3d 682, 685 (7th4 No. 16

‐ 2034

Cir. 2009) (citations omitted). Such impeachment evidence of

‐

ten includes plea agreements between cooperating witnesses

and the government. Giglio v. United States

, 405 U.S. 150, 155

(1972) (“[E]vidence of any understanding or agreement as to

a future prosecution would be relevant to [a witness’s] credi

‐ bility

... .”).

In this case, the government had a written plea agreement

with Dimona Ross, who testified against Betts

‐ Gaston. It gave

that agreement to defense counsel, and Ross testified to its

terms at trial. The plea agreement indicated that, pursuant to

18 U.S.C. § 3561, Ross could not be sentenced to a term of pro

‐

bation. It also left Ross free to argue for any sentence. At

Ross’s sentencing hearing, held ten months after Betts

‐ Gas

‐

ton’s trial, her counsel asked for a sentence of probation. At

that time, Ross had been on pretrial release for about five

years, had been compliant with conditions, was caring for her

elderly parents and her daughter, and was about to take a

good job out of the state. In the court’s view, Ross was “well

on the path to rehabilitation.” The court sentenced her to two

years of probation.

Betts

‐ Gaston believes the government agreed to secretly

change the probation

‐ eligibility term of the plea agreement,

violating Brady

. No evidence supports this theory. Moreover,

the government’s claim about Ross’s probation eligibility did

not describe a term of their agreement that could be modified.

It was simply a description of the relevant law, complete with

citation. The government might have misunderstood or mis

‐

stated the law, but could not have suppressed it, as required

for a Brady violation. Cf. United States v. Shields

, 789 F.3d 733,

747 (7th Cir. 2015) (no Brady violation in failing to discloseNo. 16

‐ 2034 5

publicly available information). There was no Brady error

here. 1

B. Voir Dire

Trial judges have “substantial discretion regarding the

manner in which” they conduct voir dire, the questioning of

prospective jurors. United States v. Harris

, 542 F.2d 1283, 1295

(7th Cir. 1976). This appellate court does not interfere “unless

there has been a clear abuse of that discretion,” but defend

‐

ants “must be permitted sufficient inquiry into the back

‐ ground and attitudes of prospective jurors to enable them to

exercise intelligently their peremptory challenges.” Id. Voir

dire must be conducted to provide “a reasonable assurance

that prejudice would be discovered if present.” United States

v. Dellinger

, 472 F.2d 340, 367 (7th Cir. 1972). That standard

will often require “go[ing] beyond asking the venirepersons

only a few

... ‘stock questions.’” Art Press, Ltd. v. Western

Printing Machinery Co.

, 791 F.2d 616, 619 (7th Cir. 1986), quot

‐ ing Fietzer v. Ford Motor Co.

, 622 F.2d 281, 285 (7th Cir. 1980).

The district judge questioned the prospective jurors after

soliciting proposed questions from both parties. The court

1 It is not clear to us that the plea agreement was in error. The agreement

cited 18 U.S.C. § 3561, which explains that a defendant “may be sentenced

to a term of probation” except under certain circumstances, including that

the offense is a class A or B felony. § 3561(a)(1). Class B felonies are those

punishable by a maximum prison term of at least twenty

‐ five years. 18

U.S.C. § 3559(a)(2). Ross pled guilty to one count of wire fraud affecting a

financial institution, a violation of 18 U.S.C. § 1343 punishable by “not

more than 30 years” in prison, and a Class B felony. See United States v.

DeRosier

, 501 F.3d 888, 899 n.21 (8th Cir. 2007). We are therefore not sure

how Ross came to be sentenced to a term of probation, but that question

is not before us.6 No. 16

‐ 2034

briefly explained the nature of the case and the burden of

proof, then questioned the jurors individually. The questions

generally explored the jurors’ backgrounds: their jobs, fami

‐

lies, hobbies, and experience with the legal system. The court

also asked whether the jurors had experience with property

ownership or as crime victims, whether they knew anyone in

the federal government, and generally whether they could be

fair to the parties.

Betts

‐ Gaston contends that the inquiries were insufficient

for two reasons. First, she says the court should have asked all

potential jurors about the burden of proof and presumption

of innocence. While that may usually be the better course, we

have held that district judges are not required to ask potential

jurors about the burden of proof and presumption of inno

‐

cence. See United States v. Sababu

, 891 F.2d 1308, 1324 (7th Cir.

1989) (holding that “the district court’s refusal to question po

‐

tential jurors during voir dire on the issues of burden of proof

and the presumption of innocence” did not “deprive[ defend

‐

ants] of a fair trial”).

Second, Betts

‐ Gaston argues the trial judge “permitted no

inquiry designed to elicit

... attitudes toward the general na

‐

ture or particular facts of the case.” Art Press

, 791 F.2d at 619;

see also United States v. Hastings

, 739 F.2d 1269, 1273 (7th Cir.

1984) (“This court will not find that a trial court abused its

discretion in conducting voir dire where there is ‘sufficient

questioning to produce, in light of the factual situation in

‐

volved in the particular trial, some basis for a reasonably

knowledgeable exercise of the right of challenge.’”), quoting

United States v. Martin

, 507 F.2d 428, 432 (7th Cir. 1974). That

criticism overstates the situation. The district court askedNo. 16

‐ 2034 7

about jurors’ experiences as crime victims and property own

‐

ers and their attitudes toward federal government employ

‐

ees—all questions that bore on Betts

‐ Gaston’s specific situa

‐

tion.

Betts

‐ Gaston asked the court to cover two topics it did not

ask about: jurors’ experience with “‘Foreclosure Rescue’ busi

‐

nesses” and their attitudes toward lawyers. There is “no gen

‐ erally accepted formula for determining the appropriate

breadth and depth of the voir dire, except that the court’s dis

‐

cretion is ‘subject to the essential demands of fairness.’”

Dellinger

, 472 F.2d at 367, quoting Aldridge v. United States

, 283

U.S. 308, 310 (1931). Refusal to ask questions may be an error

if they concern “matters where the likelihood of prejudice is

so great that not to inquire would risk failure in assembling

an impartial jury.” Dellinger

, 472 F.2d at 368 (reversing convic

‐

tions of Chicago Seven where district court refused to ques

‐

tion about attitudes toward Vietnam War and anti

‐ war protest

movement, toward “the so

‐ called youth culture—hippies,

yippies, and freaks,” and toward law enforcement); see also

United States v. Robinson

, 475 F.2d 376, 381 (D.C. Cir. 1973)

(“[T]here is

... need for a searching voir dire examination[]

[on] matters concerning which either the local community or

the population at large is commonly known to harbor strong

feelings that

... significantly skew deliberations.”).

In addition to the examples from Dellinger

, we have ap

‐ plied that rule to, for example: attitudes toward media and

advocacy groups “employing the anticipated chief witnesses,

where the testimony stemmed from work done

... on behalf

of those organizations,” United States v. Lewin

, 467 F.2d 1132,

1138 (7th Cir. 1972), and racial prejudice in the trial of a black

defendant, United States v. Robinson

, 466 F.2d 780, 782 (7th Cir.8 No. 16

‐ 2034

1972). Lawyers and foreclosure rescue do not incite compara

‐

ble passions. We think the district court “could safely assume,

without inquiry, that the veniremen had no serious prejudice

on this subject, or could recognize such prejudices and lay

them aside.” Dellinger

, 472 F.2d at 368. The district court did

not abuse its discretion in conducting voir dire.

C. Evidence of Materiality

To show a violation of the wire fraud statute, 18 U.S.C.

§ 1343, the government had to prove that Betts

‐ Gaston’s

scheme to defraud employed material falsehoods or omis

‐

sions. Neder v. United States

, 527 U.S. 1, 25 (1999); United States

v. Weimert

, 819 F.3d 351, 355 (7th Cir. 2016). A falsehood is ma

‐

terial if it has a natural tendency to influence, or is capable of

influencing, the decision of the person(s) to whom it is ad

‐

dressed. United States v. Gee

, 226 F.3d 885, 891 (7th Cir. 2000),

quoting Neder

, 527 U.S. at 16. Betts

‐ Gaston contested that ele

‐

ment at trial, arguing that the mortgage applications were not

materially false because the lenders did not care about the in

‐

formation the applications requested, such as the borrower’s

income.

Betts

‐ Gaston sought to offer additional evidence on that

point, which the district court excluded: an expert who would

testify that the lenders’ business model depended on generat

‐ ing large volumes of mortgage loans without regard for the

borrower’s ability to pay. On the government’s motion, the

district court barred the expert’s proposed testimony as irrel

‐

evant and confusing to the jury. Defense counsel also sought

to cross

‐ examine several government witnesses on whether

the lenders cared about or tried to verify loan application

claims. The district court sustained government objections to

such questions.No. 16

‐ 2034 9

Betts

‐ Gaston argues that those rulings were errors because

the expert’s testimony and the cross

‐ examination questions

were relevant to the materiality of the loan applications’ false

statements. We disagree. Betts

‐ Gaston wanted to convince the

jury that the lenders involved here routinely behaved unrea

‐ sonably—that, as a matter of policy, they ignored information

that a reasonable lender would consider, like the borrower’s

income. See United States v. Spirk

, 503 F.3d 619, 621–22 (7th Cir.

2007) (describing, as an example of a materially false state

‐

ment, obtaining a loan by exaggerating one’s income). But

whether a statement is material depends on its effect on “a

reasonable person”—or, in this case, a reasonable lender. Id.

at 621; Neder

, 527 U.S. at 22 n.5 (“The Restatement instructs

that a matter is material if

... a reasonable man would attach

importance to it[]

... in determining his choice

... .”), citing

Restatement (Second) of Torts § 538 (Am. Law Inst. 1977);

United States v. Lindsey

, 850 F.3d 1009, 1015 (9th Cir. 2017) (“A

false statement is material if it objectively had a tendency to

influence, or was capable of influencing, a lender to approve

a loan.”). Whether a particular lender or group of lenders was

in fact reasonable is irrelevant to that question. See id. (affirm

‐ ing exclusion of “evidence that [lenders] were willing to ap

‐

prove the loans regardless of the information included in the

application forms”); cf. United States v. Reynolds

, 189 F.3d 521,

525 (7th Cir. 1999) (evidence that bank would have approved

defendant’s loan regardless of judgments against him went to

reliance, not materiality). We find no error.

D. Sufficiency of Evidence on Count II

Betts

‐ Gaston moved after trial for a judgment of acquittal

pursuant to Federal Rule of Criminal Procedure 29. She ar

‐ gued among other points that the evidence was insufficient to10 No. 16

‐ 2034

show that she made materially false statements to either lend

‐

ers or homeowners. The district court denied the motion. We

review that denial de novo

, and consider whether, taking the

evidence in the light most favorable to the government, a ra

‐

tional jury could have found Betts

‐ Gaston guilty. United States

v. Warren

, 593 F.3d 540, 546 (7th Cir. 2010).

Betts

‐ Gaston has narrowed her argument on appeal, fo

‐ cusing on only Count II, which charged her with wire fraud

in connection with the Howard property. Unlike the Raven

‐

gate and Trumbull homeowners, the Howard property owner

did not testify at trial. He had died in 2006. Betts

‐ Gaston ar

‐

gues that as a result there is insufficient evidence that she

made false statements to him or to the relevant lender.

Her argument assumes that the jury must have considered

each iteration of her scheme to defraud in isolation from the

others. Not so. The jury might reasonably have credited evi

‐

dence that the Howard property transaction resembled the

Ravengate and Trumbull transactions. The same people, per

‐ forming the same roles in connection with the same company

during the same time period, found another homeowner

struggling with his mortgage. They arranged the same trans

‐

action—a sale to a straw buyer (the same straw buyer as in the

Ravengate transaction). The jury could reasonably have in

‐

ferred from that evidence that Betts

‐ Gaston procured that

homeowner’s cooperation by the same method testified to in

the Ravengate and Trumbull transactions: false statements.

Betts

‐ Gaston’s own testimony also indicated that she

made false statements to the Howard homeowner. In her tell

‐ ing, the homeowners her company served were not being de

‐ prived of all rights to their homes: they would become bene

‐No. 16

‐ 2034 11

ficiaries of the trust that held the property. But she also testi

‐

fied that the Howard property was never put into the trust.

She testified both that she told the homeowners that the sale

proceeds would be put into escrow to pay the new mortgage,

and that her company had never created escrow accounts.

The jury could reasonably infer from those inconsistencies

that Betts

‐ Gaston lied to the Howard homeowner.

There was also evidence that Betts

‐ Gaston lied to the

Howard homeowner’s sister, after her brother’s death. The

sister testified at trial. She explained that after her brother’s

death, she found documents indicating he had sold his home,

and she called Betts

‐ Gaston to ask about the sale proceeds.

Betts

‐ Gaston told her that the proceeds were in an escrow ac

‐

count, yet no escrow account ever existed. Betts

‐ Gaston ini

‐ tially told her that the program’s fee was $30,000, then that it

was $41,000. Betts

‐ Gaston also asked for an affidavit indicat

‐ ing that the homeowner’s sister and mother were his heirs and

that they wanted to receive the funds from the sale. The sister

sent her those documents but never received the funds. The

jury could reasonably infer from these inconsistencies that

Betts

‐ Gaston’s control over the proceeds was obtained fraud

‐ ulently.

E. District Judge’s Impartiality

Betts

‐ Gaston asserts that the district judge displayed hos

‐ tility and contempt toward defense counsel throughout the

trial, prejudicing the jury. Our review of the record convinces

us that, while many of defense counsel’s complaints are mi

‐

nor, there was a real and serious breakdown in the profes

‐

sional relationship between counsel and court. There were a

few lapses where the court did not always meet the high12 No. 16

‐ 2034

standard of professionalism judges do and should set for our

‐

selves, but we view those lapses as few and minor. Defense

counsel’s outbursts, by contrast, were frequent and serious.

We do not reward defendants “for success in baiting the

judge,” and we “allow reasonable latitude for normal human

sensitivity” in responding to such provocation. Dellinger

, 472

F.2d at 386; United States v. Beaty

, 722 F.2d 1090, 1094 (3d Cir.

1983) (“We

... reject any suggestion that defense counsel may

inject reversible error into a trial by baiting the trial judge.”);

United States v. Weiss

, 491 F.2d 460, 468 (2d Cir. 1974) (“Judges,

while expected to possess more than the average amount of

self

‐ restraint, are still only human.”). As the Supreme Court

has explained, bias or partiality is not shown by “expressions

of impatience, dissatisfaction, annoyance, and even anger,

that are within the bounds of what imperfect men and

women, even after having been confirmed as federal judges,

sometimes display.” Liteky v. United States

, 510 U.S. 540, 555–

56 (1994), quoted in United States v. Robbins

, 197 F.3d 829, 848

(7th Cir. 1999) (finding that visible expression of impatience

by author of this opinion did not deny defendants a fair trial).

With those principles in mind, we find that the district judge’s

conduct did not deny defendant a fair trial.

Defense counsel’s minor complaints include that the

judge: occasionally left the bench rather than immediately ad

‐ dressing her arguments; had her read a rule during argument

on a motion; forbade her paralegal to sit at the counsel table;

instructed her to display documents for the jury; told her to

obey prior rulings without explaining the rulings; expressed

frustration with how long the case had been pending; denied

requests for sidebars; told counsel not to thank him after hisNo. 16

‐ 2034 13

rulings; questioned some witnesses himself; admitted docu

‐

ments before checking to see if counsel had objections; ended

defense counsel’s re

‐ cross of one witness early; instructed the

jury to disregard some of defense counsel’s questions; pro

‐ posed an additional jury instruction; did not let defense coun

‐

sel show documents to government witnesses; and had the

defendant read a document during her testimony.

Some of this conduct reflects preferences common among

trial judges, such as the reluctance to use sidebar conferences,

the requests to show the jury documents, and the dislike of

long

‐ pending cases and of being thanked for rulings. Some

was an appropriate exercise of the judge’s power as “the gov

‐

ernor of the trial.” Quercia v. United States

, 289 U.S. 466, 469

(1933). For example, defense counsel cites two instances in

which the court sua sponte instructed the jury to disregard her

question. On the first occasion, the question called for specu

‐

lation. On the second, the court found that counsel’s re

‐ phrased question did not avoid a just

‐ sustained objection.

Neither instruction was inappropriate. Nor was the court’s

decision to end defense counsel’s re

‐ cross

‐ examination of a

witness since she was covering at length ground she had al

‐ ready covered during cross

‐ examination. Compare Trial Tr.

561 and 569 with 575–76.

Betts

‐ Gaston also complains that the court’s questions, es

‐ pecially of the defendant, “highlight[ed] facts

... to show” her

guilt. We do not see, and the defense does not explain, how

the district court’s questions were incriminating. The judge

clarified, for example, the size of Betts

‐ Gaston’s law office,

who was present during one conversation, and which mort

‐

gage Betts

‐ Gaston was testifying about.14 No. 16

‐ 2034

We do not necessarily agree with all of the district court’s

decisions, some of which are puzzling. Barring a paralegal

from counsel table created unnecessary inconvenience. By

contrast, government case agents are routinely allowed to sit

at counsel table to assist prosecutors. The court also did not

find time, even at a lunch break or after the jury had been dis

‐

missed for the day, to explain its rulings and to permit counsel

to make a record regarding them. The court also spoke as if

documents not in evidence cannot be shown to witnesses,

which is not correct. Impeachment, refreshing recollection,

and authentication often require showing witnesses docu

‐

ments not in evidence. The reasons for these choices are not

evident to us from the record, but these incidents could not

have “giv[en] the jury an impression that the court believes

the defendant is guilty.” United States v. Fry

, 304 F.2d 296, 298

(7th Cir. 1962).

These incidents also did not justify defense counsel’s inap

‐ propriate outbursts. She got off on the wrong foot even before

voir dire began, telling the judge his questions as she argued

a motion were “exceptionally rude” and “interrupting.”

(Questions from a judge who has prepared by reading briefs

should not be surprising. They provide a means to focus ar

‐

gument on the matters the judge deems most pertinent.)

Counsel’s arguments quickly became sarcastic to the point of

hyperbole. She characterized the ruling on materiality evi

‐

dence as “I can’t utter the words ‘subprime mortgage,’” add

‐ ing “I don’t believe you understand or know what the Court’s

order is. This Court is simply trying to obfuscate and make it

very difficult for me to do my job.” On another occasion—this

time in front of the jury—she said of a sustained objection,

“[i]s this an opportunity for [the witness] to continue to lie

from the witness stand?” She accused the judge, in front of theNo. 16

‐ 2034 15

jury, of “advocating for the government now,” “doing recross

for the government,” “violating my client’s Sixth Amendment

rights,” “abdicating your job as a judge” because he did not

“like the testimony coming into the record,” and “at

‐ tempt[ing] to influence the jury during these proceedings in

an inappropriate manner.” She asked if “the Court would like

to take off its robe and come down here and do the govern

‐

ment’s job for it.” In her closing argument, she said that “there

are members around here that don’t want you to be held to”

the standard of proof beyond a reasonable doubt while ges

‐ turing, in the court’s words, “to all involved in this trial.”

These inappropriate comments were well outside the bounds

of professional conduct and zealous advocacy.

In the face of these provocations, which could easily have

been deemed contemptuous, the judge did not show infinite

patience. Several times, he extended conflicts with counsel

when, at least from the cool remove of an appellate court, it

seems it might have been better to let the issue drop until the

jury left. Once he made a facial expression, reacting to the de

‐

fendant’s testimony. These responses fall well within the “rea

‐

sonable latitude for normal human sensitivity” permitted “in

judging whether responses to provocation

... are excessive.”

Dellinger

, 472 F.2d at 386; see also Liteky

, 510 U.S. at 555–56;

Robbins

, 197 F.3d at 848.

The judge’s responses differ in both kind and degree from

judicial conduct that we have found required a new trial. In

those unusual cases where we have found that a judge’s con

‐

duct “destroy[ed] the required atmosphere of impartiality,”

the inappropriate behavior was both pervasive and directed

toward the defendant. Fry

, 304 F.2d at 298. In Fry

, for example,

the court asked 1,210 questions during a seven

‐ day trial, some16 No. 16

‐ 2034

of which “tended to ridicule the defendant and his wit

‐

nesses.” Id. In the Chicago Seven case, the court made at least

150 comments in front of the jury “implying

... that defense

counsel was inept, bumptious, or untrustworthy, or that his

case lacked merit,” and “denigrating” the defense’s theories.

Dellinger

, 472 F.2d at 387–88 & n.83; see also Beaty

, 722 F.2d at

1095 (defendant deprived of fair trial by court’s prolonged

cross

‐ examinations of three of four defense witnesses); United

States v. Edwardo

‐ Franco

, 885 F.2d 1002, 1005–06 (2d Cir. 1989)

(court’s disparaging comments about Colombians at sentenc

‐ ing required re

‐ sentencing of Colombian defendants); cf.

United States v. Edmond

, 52 F.3d 1080, 1102 (D.C. Cir. 1995)

(even if court’s few “perhaps gratuitous” comments were

prejudicial, their impact was minimal in a lengthy trial).

The court’s comments in this case were few and (with the

exception of the facial expression, which the jury was imme

‐ diately instructed to ignore) not directed against the defend

‐

ant. The jury may have inferred (correctly) that the court be

‐

lieved defense counsel was behaving inappropriately. She

was. The jury had no reason to infer “that the court believe[d]

the defendant guilty.” Fry

, 304 F.2d at 298.

In some cases we have granted new trials even when there

was only one instance of judicial misbehavior, and even when

the misbehavior was not directed at the defendant. In Walberg

v. Israel

, 766 F.2d 1071, 1074 (7th Cir. 1985), for example, the

judge’s misconduct deprived the defendant of counsel’s assis

‐

tance, even though he “did not misbehave during the trial”

and directed his animus against the defendant’s lawyer. In

United States v. Spears

, 558 F.2d 1296, 1298 (7th Cir. 1977), one

outburst directed against defense counsel “so discreditedNo. 16

‐ 2034 17

[counsel] in the eyes of the jury that he could not have re

‐

mained an effective spokesman for his client.” But those cases

involved prejudice not present here. In Walberg

, the judge

threatened not to approve court

‐ appointed counsel’s fees

(and, implicitly, not to appoint him again) if he defended his

client zealously, thereby creating a conflict of interest. 766 F.2d

at 1074. In Spears

, the court all but said the jury should not

trust defense counsel. 558 F.2d at 1298. Nothing comparable

happened during Betts

‐ Gaston’s trial. This was a fair trial. See

Edwardo

‐ Franco

, 885 F.2d at 1006 (“A party does not demon

‐

strate judicial bias simply by showing that a majority of the

trial judge’s rulings were against him and that there were oc

‐

casional flare

‐ ups between his attorney and the court.”). We

thus find no reversible errors affecting defendant’s convic

‐

tions.

III. Sentencing Challenges

Betts

‐ Gaston challenges her sentence on three grounds, ar

‐ guing that: (A) the district judge should have granted her mo

‐

tion to disqualify him before sentencing; (B) the loss amount

used in determining the sentencing guideline range was cal

‐

culated incorrectly; and (C) no evidence supported enhance

‐

ment of her sentence for obstruction of justice.

A. Motion to Disqualify

The day before Betts

‐ Gaston’s sentencing hearing was

scheduled, her counsel filed a motion to disqualify the trial

judge. The judge denied the motion, and Betts

‐ Gaston argues

that this was error.

Betts

‐ Gaston relies on two statutes: 28 U.S.C. § 144, which

requires that a new judge be assigned if a party “files a timely18 No. 16

‐ 2034

and sufficient affidavit that the [original] judge

... has a per

‐

sonal bias or prejudice” against her, and 28 U.S.C. § 455(a) &

(b)(1), which requires that judges disqualify themselves when

their “impartiality might reasonably be questioned” and

when they have “a personal bias or prejudice concerning a

party.”

We reject the § 455 argument. The question under § 455 is

whether a reasonable person, knowing all the circumstances,

“would harbor doubts about the judge’s impartiality.” Chi

‐

timacha Tribe of Louisiana v. Harry L. Laws Co., Inc.

, 690 F.2d

1157, 1165 (5th Cir. 1982). For the reasons explained in the pre

‐

vious section, the judge’s behavior when taken in context re

‐

flected understandable frustration, not “undeserved” or “ex

‐

cessive” prejudice. Liteky

, 510 U.S. at 550.

We also reject the § 144 argument. The statute provides:

Whenever a party to any proceeding in a dis

‐

trict judge makes and files a timely and suffi

‐

cient affidavit that the judge before whom the

matter is pending has a personal bias or preju

‐

dice either against him or in favor of any ad

‐

verse party, such judge shall proceed no further

therein, but another judge shall be assigned to

hear such proceeding.

The affidavit shall state the facts and the rea

‐

sons for the belief that bias or prejudice exists,

and shall be filed not less than ten days before

the beginning of the term at which the proceed

‐ ing is to be heard, or good cause shall be shown

for failure to file it within such time. A party

may file only one such affidavit in any case. ItNo. 16

‐ 2034 19

shall be accompanied by a certificate of counsel

of record stating that it is made in good faith.

28 U.S.C. § 144.

Under § 144, recusal is mandatory if the moving papers

are sufficient. E.g., United States v. Sykes

, 7 F.3d 1331, 1339 (7th

Cir. 1993); United States v. Barnes

, 909 F.2d 1059, 1071–72 (7th

Cir. 1990). That makes the statute a powerful tool that could

easily be abused, so its requirements are enforced strictly.

Hoffman v. Caterpillar, Inc

., 368 F.3d 709, 718 (7th Cir. 2004);

Sykes

, 7 F.3d at 1339; Barnes

, 909 F.2d at 1072.

The district court denied recusal under § 144 for several

reasons. First, there was no affidavit from Betts

‐ Gaston her

‐

self, the “party” who must file an affidavit under the statute.

That reason for denial was correct. We and other circuits have

held that an affidavit from an attorney alleging bias is not suf

‐

ficient. U.S. ex rel. Wilson v. Coughlin

, 472 F.2d 100, 104 (7th Cir.

1973) (Stevens, J.); see also Roberts v. Bailar

, 625 F.2d 125, 128

(6th Cir. 1980); Giebe v. Pence

, 431 F.2d 942 (9th Cir. 1970).

Second, the statute requires a certificate from counsel of

record that the affidavit is filed in good faith. There is no such

certificate here. Counsel filed her own affidavit, which is not

sufficient, and obviously could not certify that a non

‐ existent

affidavit from her client was filed in good faith. See Mitchell v.

United States

, 126 F.2d 550, 552 (10th Cir. 1942) (requirement

for certificate by counsel is essential safeguard to prevent

abuse of § 144); Robinson v. Gregory

, 929 F. Supp. 334, 337–38

(S.D. Ind. 1996) (pro se party could not obtain recusal under

§ 144 because he could not comply with strict requirement for

certificate of good faith by counsel); cf. United States v. Boyd

,

208 F.3d 638, 645 (7th Cir. 2000) (suggesting that where pro se20 No. 16

‐ 2034

criminal defendant sought recusal under § 144, district court

should have appointed lawyer for limited purpose of decid

‐ ing whether to file certificate), vacated on other grounds, 531

U.S. 1135 (2001).

Third, the judge found that the motion was not timely,

coming on the eve of sentencing. An affidavit is timely if it is

filed promptly after the movant learns of the basis for disqual

‐

ification. Sykes

, 7 F.3d at 1339, quoting Barnes

, 909 F.2d at 1071.

The two affidavits defense counsel filed address events at

trial, four months before the filing. Those allegations were not

timely.

Defense counsel realized this and explained in her affida

‐

vit that she first concluded the judge’s bias was personal

(though toward her, when bias toward her client is the issue

under § 144, Gilbert v. City of Little Rock

, 722 F.2d 1390, 1398

(8th Cir. 1983)) when she read his order on her motion for a

new trial, issued just eleven days before she moved for

recusal. The portions of the order she discusses are strongly

worded: they call her arguments frivolous, obfuscating, and

“red herrings.” But it is appropriate for judges to have opin

‐

ions, even strong opinions, about the merits of arguments pre

‐

sented to them. That is their job. Such opinions do not show

personal bias unless they “display clear inability to render fair

judgment.” Liteky

, 510 U.S. at 551. Since defense counsel does

not allege facts adequate to show that the order displayed per

‐

sonal bias, her tardiness is not excused by the theory that the

post

‐ trial order alerted her to a personal bias. The district

judge did not err by finding that counsel failed to show good

cause for the late filing of the § 144 motion or by relying on

the other grounds to deny the motion.No. 16

‐ 2034 21

B. Loss Amount Calculation

In calculating Betts

‐ Gaston’s sentencing guideline range,

the district court found that the actual and intended losses

from her fraud were greater than $550,000 and adjusted her

offense level accordingly. See U.S.S.G. § 2B1.1(b)(1)(H). The

court arrived at that loss amount by adding up: (1) the home

‐

owner equity extracted from each sale, and (2) the difference

between the loans taken out on each home and that home’s

value, as measured either by a later sale or by the Cook

County Assessor’s Office. The Ravengate, Trumbull, Howard,

and Hermosa properties were all included in the calculation.

Betts

‐ Gaston raises three objections to that calculation:

first that there is no evidence that her scheme involved the

Hermosa property; second that her scheme did not cause any

losses to the lenders; and finally that she provided legitimate

services to the homeowners, the value of which should be

subtracted from the loss amount.

1. The Hermosa Property

The Hermosa property was not part of the trial but was an

issue at sentencing. The presentence report included the Her

‐

mosa transaction as relevant conduct. The government’s ver

‐

sion of the offense explained the details, citing county records

and a lawsuit against Betts

‐ Gaston regarding the property.

Betts

‐ Gaston argues that there was no evidence that the Her

‐

mosa property was involved in the scheme.

Betts

‐ Gaston’s argument assumes that the district court

could not rely on the presentence report as support for its con

‐

clusions. That assumption is incorrect: “district courts may

rely on information contained in a PSR so long as it is well

‐22 No. 16

‐ 2034

supported and appears reliable.” United States v. Moreno

‐ Pa

‐

dilla

, 602 F.3d 802, 808 (7th Cir. 2010) (citations omitted); see

also United States v. Taylor

, 72 F.3d 533, 543 (7th Cir. 1995)

(“Provided that the facts contained in a PSR ‘bear sufficient

indicia of reliability to support their probable accuracy,’ the

district court may adopt them ‘as support for its findings and

conclusions.’”), quoting United States v. Salinas

, 62 F.3d 855,

859 (7th Cir. 1995).

“Generally, where a court relies on a PSR in sentencing, it

is the defendant’s task to show the trial judge that the facts

contained in the PSR are inaccurate.” United States v. Mustread

,

42 F.3d 1097, 1101–02 (7th Cir. 1994). At least where there is an

apparently reliable basis for information in a presentence re

‐

port, “‘bare denial’” is not enough. The defendant must pro

‐

duce “some evidence” calling the presentence report into

question, unless the report contains only a “‘naked or unsup

‐ ported charge.’” Id. at 1102, quoting United States v. Isirov

, 986

F.2d 183, 186 n.1 (7th Cir. 1993). This portion of this presen

‐

tence report was supported by public property and litigation

records. Betts

‐ Gaston has not offered any evidence undermin

‐ ing those claims. The district court did not err in adopting the

findings in the presentence report on the Hermosa property.

2. Lenders’ Losses

Betts

‐ Gaston next claims that the government did not

show that the lenders who provided the mortgage loans to

her straw buyers suffered losses. Those lenders were, she con

‐

tends, playing “hot potato” with those loans—reselling them

as fast as possible for their full value. She says each lender in

‐

volved here succeeded in reselling each fraudulently obtained

loan and so never lost money.No. 16

‐ 2034 23

The lenders’ conduct might have made them inappropri

‐

ate recipients of restitution. See United States v. Litos

, 847 F.3d

906, 909 (7th Cir. 2017) (restitution not appropriately awarded

to bank that facilitated defendants’ “massive fraud”). But it is

not relevant to loss amount. For guideline purposes, the gov

‐

ernment did not need to show just who suffered losses. The

Sentencing Guidelines define “loss” as the greater of actual or

intended loss. U.S.S.G. § 2B1.1 cmt. (3)(A). “Intended loss,” in

turn, means “pecuniary harm that the defendant purposely

sought to inflict.” § 2B1.1 cmt. (3)(A)(ii). Our cases have ex

‐ plained that intended loss is “the amount that the defendant

placed at risk.” United States v. Lauer

, 148 F.3d 766, 768 (7th

Cir. 1998). Betts

‐ Gaston’s scheme induced lenders to make

mortgage

‐ backed loans that were much riskier than their

lenders realized because the borrowers were not as creditwor

‐ thy as reported. Whoever held those mortgages was exposed

to that risk.

Nothing in the Guidelines text requires the government or

the court to identify specifically who was at risk. Cf. § 2B1.1

cmt. (3)(C)(iv) (explaining that losses can be calculated by

multiplying average losses and the “approximate number of

victims”). Nor does the relevant case law. In United States v.

Engelmann

, 720 F.3d 1005, 1014 (8th Cir. 2013), for example, the

defendant pointed out that the mortgages he fraudulently ob

‐

tained were securitized, making it “more difficult to allocate

losses among individual banks or investors.” The court none

‐

theless affirmed a loss calculation that reasonably estimated

“total loss.” Id. In this case, the district court adopted a

method that also reasonably estimated losses, and we affirm

the resulting calculation. See United States v. Radziszewski

, 474

F.3d 480, 487 (7th Cir. 2007) (approving, in a mortgage fraud24 No. 16

‐ 2034

case, an intended loss amount calculated by subtracting the

property’s sale value from the loan amount).

3. Homeowner Losses and “Legitimate Services”

Betts

‐ Gaston’s final argument on loss amount is that the

losses to the homeowners should have been calculated net of

the amounts paid toward the properties’ new mortgages, and

of the value the homeowners received from being allowed to

stay in their homes. Those were legitimate services, she ar

‐

gues, and cannot be included in the loss amount. See United

States v. Swanson

, 483 F.3d 509, 513 (7th Cir. 2007).

Our review of “legitimate services” case law in this and

other circuits suggests that the dividing line between legiti

‐

mate and illegitimate services has not been clearly defined.

But a common thread in those cases is that services are legiti

‐

mate when the victim agreed to pay for them. In Swanson

, for

example, the alleged legitimate services were payments of

closing costs for an acquisition the victim gave the defendant

funds to make. Id. And in United States v. Camacho

, 348 F.3d

696, 699 (8th Cir. 2003), the legitimate services were computer

consulting work the victim had employed the defendant to

perform. Similarly, in United States v. Vivit

, 214 F.3d 908, 915

(7th Cir. 2000), the defendant billed for a fraudulently inflated

quantity of medical services. The loss amount was calculated

net of the medical services he in fact provided. By contrast, in

United States v. Crosgrove

, 637 F.3d 646, 665–66 (6th Cir. 2011),

the loss caused by defendant’s fraudulent sale of insurance

coverage was not calculated net of the “newsletter, gifts for

clients, and

... referral service” he in fact provided. The vic

‐

tims were sold insurance coverage and would not have paid

anything “had they known the coverage was fraudulent.” Id.

at 666.No. 16

‐ 2034 25

Betts

‐ Gaston’s scheme did not function by exaggerating

the value of the services provided to its victims or by charging

them for more services than were provided. It functioned, like

the Crosgrove scheme, by selling a service it did not in fact pro

‐

vide. It was entirely fraudulent. Under those circumstances,

the district court did not err in refusing to consider some por

‐

tion of the defendant’s services “legitimate.”

C. Obstruction of Justice

Finally, the district court adjusted Betts

‐ Gaston’s guideline

offense level because it found that she obstructed justice by

testifying falsely at trial. See U.S.S.G. § 3C1.1. Betts

‐ Gaston’s

father was the straw buyer for the Trumbull property. His

mortgage application stated falsely that he was buying the

property as a second home. Betts

‐ Gaston testified at trial that

she did not know the application said that, and that when she

found out at the transaction’s closing, she explained to her fa

‐

ther that he would have to stay at the property occasionally.

The district court found that testimony to be false. Betts

‐ Gas

‐

ton argues that no evidence supports that finding. We review

such factual findings for clear error, affirming unless we are

left with a definite and firm conviction that a mistake has been

committed. United States v. Davis

, 442 F.3d 1003, 1008–09 (7th

Cir. 2006), quoting United States v. Lanzotti

, 205 F.3d 951, 956

(7th Cir. 2000).

The district court’s determination was not mistaken for

two reasons: Betts

‐ Gaston’s narrative was implausible in its

own right, and Ross’s testimony contradicted her. To believe

Betts

‐ Gaston’s version of the story, the court would have had

to believe that, on learning for the first time that the applica

‐

tion erroneously indicated the purchase was for a second

home, Betts

‐ Gaston would not have tried to fix the error. It26 No. 16

‐ 2034

would have had to accept that she thought it made sense to

ask her father to move from the suburbs to Chicago’s south

side to reside occasionally with a woman he did not know,

presumably leaving his mother (who lived with him) alone.

And the court would have had to believe that her father

agreed to that after one conversation at the closing. The court

did not clearly err in disbelieving that testimony.

Nor did the court err in crediting Ross’s testimony. She de

‐

scribed Betts

‐ Gaston as actively involved with her father’s

loan application, acting as a go

‐ between to adjust his reported

income and the purpose of the purchase until he qualified for

the loan. In Ross’s account, Betts

‐ Gaston proposed reporting

that the property would be her father’s primary residence, but

Ross refused to use such a blatant falsehood. Betts

‐ Gaston

then said to say it would be his secondary residence, and Ross

agreed to that. That testimony supports the district court’s ap

‐ plication of the obstruction of justice enhancement.

The judgment of the district court is AFFIRMED.