Court Opinion

ID: 9363811
Source: CourtListenerOpinion
Date Created: 2023-01-17 19:00:21.645624+00
Date Added: 2024-06-11T17:15:34.420343
License: Public Domain

NOT PRECEDENTIAL

                       UNITED STATES COURT OF APPEALS
                            FOR THE THIRD CIRCUIT
                                 _____________

                                      No. 22-1002
                                     _____________

                            UNITED STATES OF AMERICA

                                             v.

                                    AARON DAVIS,
                                                Appellant

                      _____________________________________

                 On Appeal from the United States District Court for the
                                   District of Delaware
                        (District Court No. 1-19-cr-00101-001)
                         District Judge: Hon. Leonard P. Stark
                     _____________________________________

                   Submitted Pursuant to Third Circuit L.A.R. 34.1(a)
                                  November 8, 2022

                                 (Filed: January 17, 2023)

             Before: JORDAN, SCIRICA, and RENDELL, Circuit Judges.
                                  _________
                                      O P I N I O N*
                                       _________

*
 This disposition is not an opinion of the full Court and pursuant to I.O.P. 5.7 does not
constitute binding precedent.
RENDELL, Circuit Judge.

       Defendant-Appellant Aaron Davis challenges his conviction for taking part in a

large fraud scheme that targeted financial institutions, a healthcare company, and the

Government. He lodges two objections. The first is to the District Court’s admission of

victim impact testimony from a representative of the targeted healthcare company that

lost money due to the scheme. The other is to the Government’s urging the jury to use

common sense during the portion of the Government’s closing argument about willful

blindness, which Davis construes as a “Golden Rule” instruction. For the reasons set

forth below, we reject Davis’s arguments and will affirm.

                                            I. 1

       In the summer of 2017, Davis and a few accomplices hatched an ambitious fraud

scheme. The group targeted two banks, a nonprofit healthcare company called Sutter

Health, and the Social Security Administration (“SSA”). The plan unfolded in three parts

over a three-month period: they used a check kiting 2 scheme to steal money from the

1
  Ordinarily, we write not precedential opinions with the benefit of a written opinion from
the District Court. But Davis’s claimed errors arose from the District Court’s oral rulings
on his objections, none of which were reduced to writing. We do not fault the District
Court for that decision under the circumstances. Still, the absence of a written opinion
obliges us to explore the facts, procedural background, and legal analysis more fully than
usual for a non-precedential opinion, and we do so here.
2
 Check kiting takes advantage of the lag time in the process banks use to reconcile the
balances of accounts involved in a transaction between them:
       Check kiting is a systematic pattern of depositing nonsufficient funds (NSF)
       checks between two or more banks, resulting in the books and records of
       those banks showing inflated balances that permit these NSF checks to be
       honored rather than returned unpaid. In addition, other checks and

                                             2
banks; a business email compromise 3 scheme to steal money from Sutter Health; and a

wire fraud scheme to steal SSA funds by applying for benefits in the name of a retiree

without his knowledge or consent. 4 But the banks involved quickly grew wise: they froze

Davis’s accounts and, by doing so, limited the group’s theft to just over $225,000 of the

$1.3 million they managed to deposit in the accounts through fraud. A federal grand jury

later indicted Davis for two counts of bank fraud, in violation of 18 U.S.C. § 1344(2);

       withdrawals may be honored against these inflated balances, resulting in
       actual negative balances, to the extent that banks allow withdrawal of
       uncollected funds.
Johnny S. Turner et al., Check Kiting: Detection, Prosecution, and Prevention, 62 FBI
Law Enforcement Bulletin 12, 13 (Nov. 1993),
https://www.ojp.gov/pdffiles1/Digitization/145802NCJRS.pdf.
3
 The FBI explained the nature of business email compromise scams in a recent report
commissioned by Congress:
       BEC scams rely on deception and social engineering to convince victims—
       including companies, charities, schools, real estate purchasers, and the
       elderly—to send money, usually via wire transfer, to bank accounts
       controlled by criminal actors. While there are many variations, BEC schemes
       often involve the spoofing of a legitimate, known email address or the use of
       a nearly identical address to appear as someone known to or trusted by the
       victim. BEC scams are initiated when a victim receives false wire
       instructions from a criminal attempting to redirect legitimate payments to a
       bank account controlled by fraudsters; such scams are constantly evolving as
       criminals become more sophisticated.
Federal Bureau of Investigation, Business Email Compromise and Real Estate Wire
Fraud, 4 (2022).
4
  Davis’s scheme targeted Jay Abraham, who testified at trial that he had previously
applied for Social Security benefits but never took disbursement of the money because, as
a successful marketing consultant, he did not need to do so. Abraham learned of Davis’s
fraudulent application purely by chance when Medicare denied his claims for treatment
of a catastrophic medical condition because the disbursement of his Social Security
benefits triggered irregularities in Medicare’s claims process.

                                             3
two counts of wire fraud, in violation of 18 U.S.C. § 1343; and one count of money

laundering, in violation of 18 U.S.C. § 1957.

       Davis’s trial lasted five days, and the Government put on a dozen witnesses and

introduced more than 100 exhibits to explain the nature and breadth of Davis’s scheme.

The Government’s case included evidence showing the banks told Davis that they

suspected fraud, though Davis and his cohort continued their efforts undeterred. The jury

also heard that Davis alleged in a police report that the suspicious money appeared in his

account because of fraud against him, and he supported those allegations with documents

that law enforcement officials later found to be false.

       During the trial, Davis challenged the Government’s efforts to elicit so-called

“victim impact testimony” from Sutter Health’s Chief Financial Officer, Mark Wheeler.

Wheeler testified that Davis redirected $1.1 million in company funds to his account and

over $220,000 of that money remained outstanding. Having established the company’s

loss, the Government asked Wheeler to “tell the jury about the impact of [the] loss on

Sutter Health.” App. 613 (emphasis added). Davis quickly raised a relevance objection,

arguing the impact on Sutter Health bore no relation to the charged offenses. The

Government argued the testimony was “clearly relevant” because “the company was

defrauded out of the lost money.” App. 613. After weighing the objection and response,

the District Court allowed Wheeler’s testimony but did not explain its ruling.

       Wheeler then told the jury that the losses hurt the company’s ability to fulfill its

mission:

                                              4
              So I mean the impact for us—we’re not for profit, you know,
              healthcare. We provide a lot of services in our communities.
              So missing money or losing money to fraud means less patients
              we can serve, less community impact we can have. We do a
              lot of charitable, charitable contribution to our individual
              communities so, yes, it had a financial impact. We’ve had
              negative years over the last two years operating losses.
              COVID has taken a toll. Fraud just continued to impact us,
              you know, or undermine what we can do in the community. So
              it is very impactful to Sutter Health.

App. 613–14. Davis challenged the testimony a second time after Wheeler finished and

the jury left the room. He attacked on three fronts: he moved to strike the evidence as an

unfair attempt to gain the jury’s sympathy; he moved for a mistrial because the District

Court would send a “mixed message to the jury” if it both allowed the testimony and

issued an instruction to disregard sympathy and bias, App. 621, and he moved for the

District Court to exclude the testimony under Federal Rule of Evidence 403 as unfairly

prejudicial and lacking any probative value. This time, the Government defended the

impact testimony as relevant to provide “color and background” for the jury about Sutter

Health’s monetary losses. App. 624.

       The District Court made an oral ruling from the bench denying each of Davis’s

objections. To begin, Wheeler’s testimony did not call for a mistrial, and in any case,

Davis offered the District Court no standard to determine whether he was entitled to the

relief he sought. The motion to strike was also a non-starter: Wheeler’s testimony “was

relevant, perhaps not highly relevant, but relevant to complete the background of the

story as to why Sutter Health” was part of the proceedings. App. 626.

                                             5
       Finally, the reasons for denying Davis’s first two challenges also persuaded the

District Court that the Rule 403 balancing test did not favor exclusion—especially since

Wheeler’s testimony confirmed “what the jury probably already inferred.” App. 626.

The District Court also concluded that sufficient safeguards were in place to mitigate

Davis’s risk of suffering unfair prejudice from Wheeler’s testimony: the jury had already

been instructed not to let sympathy or bias govern their decision and would receive that

same instruction before closing arguments; the court was willing to give a limiting

instruction of Davis’s choice; and at the end of the day, Davis was challenging “one

question in the context of . . . 15 minutes or so of testimony.” App. 625. Yet when the

District Court followed up on its offer to give the limiting instruction Davis preferred, he

declined.

       Later, the Government’s closing argument to the jury about Davis’s state of mind

provoked a fresh objection from him. The Government described Davis’s multiple

attempts to withdraw funds after the banks confirmed their fraudulent nature, posing a set

of rhetorical questions and a proposed response: “[a]t the very least, did the defendant

stick his head in the sand? Was he willfully blind to whether the money in that account

belonged to him? Absolutely he was.” App. 1366–68. Then the Government asked the

jury to imagine how they would have reacted to the unexpected appearance of several

large deposits to their bank accounts from unknown sources like the ones Davis received:

              But members of the jury, also just listen to your common sense.
              Ask yourself, if $1.3 million from unknown or strange sources
              showed up in your account, wouldn’t you want to find out
              where the money was coming from? Wouldn’t you wonder
              why some company you have never heard of was depositing

                                             6
              over a million dollars into your account? Why the Social
              Security Administration was sending you tens of thousands of
              dollars when you had never filed for benefits? Wouldn’t you
              ask yourself why you were getting checks for 5, 20, 40,
              $75,000 from people you had never met? Wouldn’t you leave
              that money alone, especially after you had been told that the
              money was likely fraudulent, until you could figure out what
              was going on?

App. 1359–60. Pressing that theme further, the Government referred to the specific

deposit of SSA funds to Davis’s account and asked the jury once again to contemplate

what they would have done if similar deposits landed in their own accounts:

              Well, it was right there in black and white on his statement,
              because the money that was being deposited was from the SSA
              Treasury of the Social Security Administration Treasury,
              $21,195. And even if the defendant didn’t know what SSA
              treasury means, members of the jury, ask yourselves if $21,000
              showed up in your account and you didn’t know where it was
              coming from.

App. 1373. Davis objected to the Government’s appeal as an improper “Golden Rule”

argument and requested a mistrial, though when pressed by the District Court, he could

provide no authority for the objection. So the District Court overruled Davis’s

objection, 5 reasoning that the Government’s argument was “entirely consistent with the

[willful] blindness instruction” the jury was given earlier, which required the jury to “use

their common sense and think about what a reasonable person might do if they saw a

deposit they didn’t know about in their account.” App. 1375.

5
  Despite overruling the objection, the District Court gave Davis the chance to file
supplemental briefing “at any time” to support his position. App. 1375. Nothing in the
record reveals Davis took the District Court up on its offer.

                                             7
       In the end, the jury deliberated less than two hours before convicting Davis on all

counts. On December 21, 2021, Davis received a 36-month prison sentence. Davis

timely appealed his conviction.

                                             II.

       We have appellate jurisdiction under 28 U.S.C. § 1291, while the District Court

had subject matter jurisdiction under 18 U.S.C. § 3231. We review a district court’s

decision to admit or exclude evidence for abuse of discretion. United States v. Desu, 23

F.4th 224, 233 (3d Cir. 2022) (internal citation omitted).

                                            III.

       Davis presents three issues on appeal: (1) whether the District Court committed

prejudicial error when it “admitted victim impact testimony during the Government’s

case-in-chief”; (2) whether the District Court committed prejudicial error when it

“allowed the Government to make [a] Golden Rule argument during its closing”; and (3)

“[e]ven if the above errors were individually harmless . . . [whether] their cumulative

effect [was] prejudicial[.]” Appellant’s Br. at 2. We need only address the first two

issues because we find no error.

       First, Davis relies on United States v. Copple, 24 F.3d 535 (3d Cir. 1994) and

United States v. Sokolow, 91 F.3d 396 (3d Cir. 1996) to argue that victim impact

testimony is inadmissible. But Davis reads those cases too broadly. We explained in

Copple that the difficulty of proving a defendant’s specific intent in fraud cases requires

“a liberal policy . . . to allow the government to introduce evidence that even peripherally

bears on the question of intent.” 24 F.3d at 545. In that way, evidence that “someone
                                             8
was victimized by the fraud” provides us with “some evidence of the schemer’s intent.”

Id. (citing United States v. Heimann, 705 F.2d 662, 669 (2d Cir. 1983)). Further,

evidence of a victim’s loss suffices to prove the defendant’s specific intent to defraud, as

does evidence of “the defendant’s failure to take any steps to ameliorate the loss.” Id.

(citing Anderson v. United States, 369 F.2d 11, 15 (8th Cir. 1966)). The same goes for

testimony about the effect of those losses, but we have cautioned district courts to

“exercise their wise discretion” and admit only testimony that is “reasonable to prove [the

defendant’s] specific intent to defraud.” Id.

       Considering that framework, Copple and Sokolow offer Davis little help. Copple

featured a group of funeral directors who fell victim to a huckster promising to manage

assets the funeral directors used to fund the prepurchase of funeral services. 24 F.3d at

538–40. Not only did the district court admit evidence that the funeral directors lost

money in the scheme, but it also admitted the testimony of multiple directors about the

negative impact 6 of those losses. Id. at 545–46. We agreed that the district court abused

its discretion when it admitted the testimony, but we qualified that assessment: the district

court did not err by admitting any impact testimony; instead, the error arose from

admitting too much testimony and from the fact that some of it “went beyond anything

that was reasonable to prove [the defendant’s] specific intent to defraud.” Id. at 545. The

same was true in Sokolow, where we observed that the district court’s decision to admit

6
  Among other things, the funeral directors testified that the loss of the funds forced them
to raid their children’s college funds and other personal savings and caused adverse
effects on their health. Copple, 24 F.3d at 545–46.

                                                9
the impact testimony of twenty witnesses “provided significant embellishment concerning

adverse personal consequences” since the Government asked “every victim who testified

whether [they] suffered any adverse consequences from the unpaid claims” in a clear

attempt “to highlight [their] personal tragedies.” Sokolow, 91 F.3d at 407 (alterations and

emphasis added).

       Copple and Sokolow thus boil down a simple proposition: district courts may

admit victim impact testimony, but they may not admit too much of it, nor can they admit

testimony that goes “beyond anything that was reasonable to prove [the defendant’s]

specific intent to defraud.” 24 F.3d at 545. Unlike in those cases, the victim impact

testimony offered against Davis checks neither of the forbidden boxes. Davis points to a

single witness—Wheeler—who testified on behalf of a corporation, rather than a natural

person. In response to the Government’s question about the impact of Davis’s fraud,

Wheeler gave a single response about Sutter Health’s diminished ability to serve its

community. Yet the Government chose not to venture beyond Wheeler’s single answer

even though the scope of Sutter Health’s loss and its impact on the company’s charitable

mission likely would have justified a deeper inquiry than the Government undertook. So

the District Court did not err when it allowed Wheeler’s testimony.

       Davis’s “Golden Rule” argument fares no better. Davis says the Government

committed misconduct when it “directed Jurors to make findings about [his] state of mind

by placing themselves in his shoes at the time of the offense and to ask themselves what

their own state of mind would have been in those circumstances.” Appellant’s Br. at 16.

He urges that the alleged misconduct deprived him of a fair trial—and entitles him to a

                                            10
new one—because the Government’s argument led the jury “to convict Davis in

comparison to their own sense of innocence” and not based on the evidence. Appellant’s

Br. at 16. We disagree.

       The bottom line is that Davis’s position rests on a misunderstanding of “Golden

Rule” arguments. Like other advocates, prosecutors can “make[] effective use of themes,

metaphors, and references to popular culture” in their arguments to a jury. Gov’t of the

Virgin Islands v. Mills, 821 F.3d 448, 458 (3d Cir. 2016). But “Golden Rule” arguments

“cross the line” and amount to misconduct because they are emotional appeals that

“invite the jury to render a decision on grounds of bias, passion, prejudice, or sympathy.”

Id. Those arguments take two basic forms. One is where prosecutors make an improper

“put yourself in the defendant’s shoes argument” that “encourages the jury to depart from

neutrality” and decide the case based on “personal interest and bias rather than on the

evidence.” Edwards v. City of Philadelphia, 860 F.2d 568, 574 (3d Cir. 1988) (quoting

Spray–Rite Serv. Corp. v. Monsanto Co., 684 F.2d 1226, 1246 (7th Cir. 1982)). The

other is where prosecutors use “comments like ‘it could have been you’ the defendant

killed or ‘it could have been your children’” so that jurors “identify individually with the

victims,” or try to scare jurors into a conviction “by predicting that if they do not convict,

a crime wave or some other calamity will consume their community[.]” Mills, 821 F.3d

at 458 (quoting Bedford v. Collins, 567 F.3d 225, 234 (6th Cir. 2009)).

       The Government did nothing of the sort in Davis’s trial. Rather, as the District

Court concluded, the Government’s argument was “entirely consistent” with the earlier

instruction on willful blindness. App. 1375. That instruction gave the Government two

                                             11
ways to prove Davis’s fraudulent intent. The more direct way was to show Davis

actually “knew of the fraudulent nature of the deposits.” App. 1324. The alternative

route was to show Davis “acted with deliberate disregard” as to “whether the deposits

were legitimately intended for him or with a conscious purpose to avoid learning whether

the deposits were legitimately intended for him.” App. 1324–25 (emphasis added).

       Read against that backdrop, and in light of Davis’s conduct regarding the deposits

to his account, the Government’s argument gave the jury a way to test whether Davis

acted with the intent required by the charges against him. All the more because the

Government prefaced its argument with a recap of the evidence showing Davis kept

trying to withdraw the stolen money after multiple bank representatives raised red flags

about it and then cast himself as a victim of fraud. Not only that, but the Government

also drew an explicit link between that evidence and the concept of willful blindness

when it asked jurors if Davis had “st[uck] his head in the sand” or was “willfully blind to

whether the money in [the] account belonged to him[.]” App. 1366–68. And how was

the jury to determine whether those things were true? By doing precisely what the

Government asked them to do: “use their common sense” to consider “what a reasonable

person might do if they saw a deposit they didn’t know about in their account.” App.

1375. The Government’s request was appropriate, and it did not invite jurors to

substitute bias, prejudice, or fear for the evidence before them.

       Yet, Davis tries to sidestep all of that by pointing to two of our cases and two

cases from our sister courts. None get him very far. Start with our decisions in Mills and

Edwards, both of which featured prototypical “Golden Rule” arguments. In Mills,

                                             12
prosecutors argued that jurors “were not safe in their home” while the defendant

remained at large, and they sowed further fear of an “ongoing threat to schoolchildren

created by the [defendant’s] discarded gun[.]” 821 F.3d at 458–59. That led us to call

out the prosecution for coaxing jurors into a decision based on “bias, passion, prejudice,

sympathy” and fear created by the “specter” of “purely ‘inflammatory’” public safety

concerns. Id. at 458–59. In a similar vein, we recognized in Edwards that counsel’s

opening statement instruction was inappropriate in telling jurors that they should not only

listen to the defendant police officer’s testimony, but they should also “put [themselves]

in his shoes,” “see through his eyes that evening,” “hear what he heard,” and “try to

experience was he was feeling.” 860 F.2d at 573 n.5; see also id. at 575 (finding that the

District Court’s final instructions “sufficiently negated any prejudice that might have

resulted from [defense] counsel’s errant arguments to the jury.”). In sum, Mills and

Edwards involved blatant “Golden Rule” appeals that bear no resemblance to the

Government’s benign—and necessary—argument about Davis’s state of mind.

       For somewhat different reasons, our sister courts’ decisions in United States v.

Teslim, 869 F.2d 316 (7th Cir. 1989) and United States v. Palma, 473 F.3d 899, 901 (8th

Cir. 2007) do not rescue Davis’s claim. In Teslim, a defendant convicted for drug-related

offenses alleged that prosecutors encouraged jurors “to disregard the presumption of

innocence” when they placed a cloud over his behavior during the pivotal stop by saying

“if it happened to you, and you had nothing to hide . . . .” 869 F.2d at 327–28. True

enough, Teslim involved a similar sort of appeal to the jury, but the defendant faced the

wrong kind of charges to help Davis: that defendant’s drug charges made the prosecutor’s

                                            13
statement inappropriate, while Davis faced fraud charges that made it necessary for jurors

to probe his state of mind in the way they did. And Palma presents the mirror image

problem: it has the right kind of charges (social security fraud) but the wrong kind of

appeal to the jury (inflammatory remarks about how the defendant’s fraud stole money

from them). 473 F.3d 89. None of these cases help Davis’s cause, and his “Golden

Rule” argument fails.

                                            IV.
       In sum, the District Court did not abuse its discretion in connection with the

rulings Davis challenges, and we will accordingly affirm.

                                            14