United States v. McDonald

1

UNITED STATES OF AMERICA, v. JENNIFER RAE MCDONALD, Defendant.

CRIMINAL ACTION No. 5:21-cr-00012

United States District Court, W.D. Virginia, Harrisonburg Division

January 23, 2024

MEMORANDUM OPINION

Elizabeth K. Dillon, United States District Judge.

Pending before the court are two post-trial motions by defendant Jennifer Rae McDonald: a motion for judgment of acquittal (Dkt. No. 221) and a motion for new trial (Dkt. No. 222). The United States has responded to both (Dkt. Nos. 231, 232), and McDonald has not filed a reply. The United States also recently filed a notice of supplemental authority relevant to the motion for new trial. (Dkt. No. 233.)

For the reasons discussed below, the court will deny McDonald's motion for new trial and will deny in part and grant in part her motion for judgment of acquittal. Specifically, the court will deny the motion for acquittal as to the aggravated identity theft in Count 18 and will grant the motion as to the bank fraud counts in Counts 14 through 17. Consistent with Federal Rule of Criminal Procedure 29(d), the court also considers whether to conditionally grant a new trial in the event that its judgment of acquittal is reversed on appeal and concludes that a new trial would not be necessary. Thus the court declines to conditionally grant a new trial as to Counts 14 through 17.

I. BACKGROUND

At trial, the jury found McDonald guilty on all 34 counts in the indictment: seven counts of wire fraud, ten counts of bank fraud, one count of aggravated identity theft, and sixteen counts of money laundering. In general terms, these counts stem from allegations that McDonald employed a scheme to improperly obtain and use monies belonging to her employer, the Town of Front Royal and Warren County Economic Development Authority (EDA), for her own benefit.

Facts relevant to McDonald's motions will be discussed in context.

II. DISCUSSION

A. Motion for Judgment of Acquittal

In her first motion, McDonald renews her motion for a judgment of acquittal on Count 18 (aggravated identity theft) and Counts 14-17 (bank fraud). With regard to the aggravated identity theft, she argues that the evidence was insufficient to show that she used a means of identification of another during and in relation to the wire fraud alleged in Count 1. (See Motion 1, Dkt. No. 221.) She argues that the bank fraud counts were infirm because there was no misrepresentation to United Bank that caused it to issue the relevant checks. (Id.)

1. Standard of review

McDonald's motion for judgment of acquittal is made pursuant to Federal Rule of Criminal Procedure 29. That rule provides that “the court on the defendant's motion must enter a judgment of acquittal of any offense for which the evidence is insufficient to sustain a conviction.” Fed. R. Crim. P. 29(a). “A defendant challenging the sufficiency of the evidence faces a heavy burden .... ” United States v. Young, 609 F.3d 348, 355 (4th Cir. 2010) (internal citations and alterations omitted). Specifically, “[t]he jury's verdict must stand unless . . . no rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt.” United States v. Royal, 731 F.3d 333, 337 (4th Cir. 2013) (citing Young, 609 F.3d at 355).

Put differently, the motion should be denied if the jury's verdict on any given charge is supported by “substantial evidence.” United States v. Alvarez, 351 F.3d 126, 129 (4th Cir. 2003). “[S]ubstantial evidence is evidence that a reasonable finder of fact could accept as adequate and sufficient to support a conclusion of a defendant's guilt beyond a reasonable doubt.” United States v. Burgos, 94 F.3d 849, 862 (4th Cir. 1996). In addressing a claim of insufficient evidence, moreover, this court must “view the evidence and the reasonable inferences to be drawn therefrom in the light most favorable to the [g]overnment .... ” Young, 609 F.3d at 355 (citation omitted).

2. Count 18 - aggravated identity theft

The jury found McDonald guilty of aggravated identity theft, in violation of 18 U.S.C. § 1028A(a)(1). To establish the offense of aggravated identity theft, the government was required to prove that McDonald (1) knowingly used, without lawful authority, a means of identification of another person (here, Truc Tran), (2) knew that the means of identification belonged to another person, and (3) used the means of identification during and in relation to the felony crime of wire fraud, as alleged in Count 1. (Jury Instr. 48, Dkt. No. 215.) McDonald agrees that this jury instruction was proper. The government cites to the same instruction and does not dispute its correctness. (Opp'n Mot. for Acquittal 4, Dkt. No. 232.)

Because the third element refers to the wire fraud offense in Count 1 and requires proof of that offense beyond a reasonable doubt, United States v. Harrison, 843 Fed.Appx. 524, 525 (4th Cir. 2021), the parties also discuss the elements of that offense. As to Count 1, the court instructed the jury that the government was required to prove that McDonald (1) knowingly devised a scheme or artifice to defraud or to obtain money by false pretenses, representations, or promises; (2) did so with the intent to defraud; and (3) in furthering or carrying out this scheme to defraud, transmitted or caused the transmission of a writing, sign, signal, picture, or sound by means of a wire communication in interstate commerce. (Jury Instr. 26, Dkt. No. 215.) The parties stipulated and agreed that the listed wire transfers constituted wire communications in interstate commerce. (Id.)

a. Facts

The government summarizes the facts of the aggravated identity theft offense as follows: McDonald used Truc Tran's identity, his nickname ‘Curt Tran,' and his specific position as the owner of the company ITFederal, for her LLC, Daboyz, to purchase a property known as Buck Mountain Road with stolen EDA money. McDonald set up a ruse, i.e., that Tran was purchasing the property, in order [to] explain why the wire to purchase the property came from the EDA, when in fact, McDonald was purchasing the property and taking EDA funds for herself. (Id. at 5.) McDonald contends, however, that there was insufficient evidence from which the jury could find that the “means of identification” was used “during and in relation to” the wire fraud in Count 1.

Count 1 charged McDonald with wire fraud related to a September 14, 2016 wire transfer of $2 million from an EDA account held at the First Bank and Trust (First Bank) to an account held at Union Bank and Trust (Union) in the name of TLC Settlements, LLC. Truc Tran was an individual who was doing business in Warren County in 2016 through his company ITFederal. Several witnesses testified at trial about knowing who Curt Tran was and that he was a businessman. Tran testified at trial and explained that he generally used the name “Curt” as his first name, which is Truc spelled backward. Tran further testified, though, that he never signed important or legal documents with the name “Curt Tran” because that was not his legal name, and he never initialed such documents with “CT”.

In mid-2016, McDonald provided to TLC Settlements three contracts for the purchase of three parcels of real property the U.S. referred to as the Buck Mountain Road Property. At first, the three contracts listed the buyer as “Curt Tran” and the sellers as William Vaught and Rappawan Inc. (Trial Exs. 376A, 376B, and 376C.) The contracts were purportedly signed and initialed by Tran, although Tran testified that he did not sign or initial these contracts, that he was not involved in the Buck Mountain Road property purchase in any way, and that the signature on the contracts was not his. Tran also pointed out, and the jury was shown, his true signature on another document. (See Gov't Ex. 404.)

McDonald made out checks for the earnest money deposit and wrote in the memo line, “Tran.” (See Gov't Exs. 410A, 410B, and 410C.) Vaught, the seller, testified that he believed he was selling the property to Tran, although he never met him. McDonald had told Vaught that Tran was operating a farm for at-risk youth and wanted the Buck Mountain Road property for that reason. Again, according to Tran, he had no interest in the Buck Mountain Road property and did not intend to operate a farm for at-risk youth.

McDonald initiated the transaction with TLC Settlements using her EDA mail account. (Gov't Ex. 382.) She emailed TLC Settlements on September 8, 2016, stating “Here is the contract for the Buck Mountain property. Could you send me a draft HUD as soon as you get a chance so I can call and give him the information to wire the money?” (Id.) Two employees of TLC Settlements responded by asking, “Is he taking title as ITFEDERAL or personally?” (Id.) This establishes that TLC Settlements believed the transaction involved Tran and that McDonald was saying that she would give Tran the wire information. McDonald responded, “On all 3 he is actually leaving the country on Monday for 2 months so he has formed an LLC so that I can and one other person sign the paperwork for him. It will be in the LLC's name. And Christy will love the name of my LLC . . . . Daboyz, LLC. Lol © I am getting the paperwork together to change the name on the contract.” (Id.) Thus, McDonald again was using Tran's identity and was representing that she was acting on his behalf. As Tran testified, however, he had no involvement in, or knowledge of, the transactions.

McDonald then emailed TLC Settlements a copy of a contract addendum that changed the original contracts from “Curt Tran” to Daboyz, LLC. (Gov't Ex. 383.) Tran testified that he did not sign this document or write the addendum and that the signature did not match his true signature.

McDonald then caused...