Argued: December 6, 2018
from the United States District Court for the Eastern
District of Michigan at Bay City. No. 1:14-cr-20216-4-Thomas
L. Ludington, District Judge.
A. Satawa, SATAWA LAW, PLLC, Southfield, Michigan, for
Sheldon N. Light, UNITED STATES ATTORNEY'S OFFICE,
Detroit, Michigan, for Appellee.
A. Satawa, SATAWA LAW, PLLC, Southfield, Michigan, for
Parker, UNITED STATES ATTORNEY'S OFFICE, Detroit,
Michigan, for Appellee.
Before: MOORE, CLAY, and DONALD, Circuit Judges.
NELSON MOORE, CIRCUIT JUDGE.
Bradley, Sr. appeals his conviction for conspiring to defraud
the United States, in violation of 18 U.S.C. § 371.
Bradley worked as the general contractor on Steven
Ingersoll's project converting an old church in Bay City,
Michigan into a new charter school called Bay City Academy
(BCA). Ingersoll had previously misappropriated state funding
that had been destined for a charter school he already ran,
Grand Traverse Academy (GTA), and used the funding for the
new charter school project to cover his tracks. At trial,
Bradley was shown to have conducted a series of fraudulent
transfers of the newly misappropriated money, failed to
account for the resulting sizeable deposits into his accounts
in his 2011 tax filing and thus underpaid his taxes, and
failed to file W-2s reporting his BCA employees' wages to
the IRS and to provide them with Form 1099s. Bradley argues
that his conviction should be overturned for three reasons:
(1) the testimony that he underpaid his taxes in 2011
constituted a prejudicial constructive amendment or variance
to the indictment, (2) the government made improper arguments
during its opening statement and rebuttal, and (3) the
district court improperly refused to instruct the jury on a
lesser-included offense. We AFFIRM
Ingersoll was an optometrist in Bay City, Michigan. (Bradley
PSR at 5). He was also the sole owner of Smart Schools
Management (SSM) and Smart Schools, Inc. (SSI), two entities
created to operate public charter schools in Michigan. R. 393
(Tr. at 39, 50) (Page ID #8472, 8483); R. 394 (Tr. at 11)
(Page ID #8579); R. 396 (Tr. at 164-65) (Page ID #8903-04).
To run public charter schools, the State of Michigan first
issues funding to authorizing agencies. Michigan gave funding
to Lake Superior State University, an authorizing agency,
which then deposited those funds into SSM's account,
managed by Ingersoll. R. 396 (Tr. at 165) (Page ID #8904).
With these funds, Ingersoll founded GTA, a charter school in
Traverse City, Michigan, in 1999. R. 393 (Tr. at 52) (Page ID
#8485). Ingersoll proceeded to misappropriate funding
designated for GTA, making millions of dollars in
unauthorized withdrawals and doctoring the books to hide the
evidence. R. 388 (Tr. at 124) (Page ID #7718); R. 389 (Tr. at
75) (Page ID #7839).
April 2010, Ingersoll sought to expand his charter-school
business by purchasing a building that had formerly been used
as a church in Bay City, Michigan for $270, 000. R. 396 (Tr.
at 154) (Page ID #8895). Ingersoll planned to renovate the
building to create BCA, a new charter school. R. 396 (Tr. at
157-58) (Page ID #8896-97). Ingersoll hired Bradley as the
general contractor to oversee the renovations. R. 396 (Tr. at
156-57) (Page ID #8893-96); R. 397 (Tr. at 51-52) (Page ID
#8961-62). Ingersoll improperly used state funds issued to
GTA for the construction of the new charter school, BCA. R.
393 (Tr. at 66-67) (Page ID #8499- 8500). Through another one
of his companies, Madison Arts, LLC, Ingersoll took out a
$1.8 million construction line of credit loan from Chemical
Bank to further fund the BCA project. R. 396 (Tr. at 154)
(Page ID #8893); R. 397 (Tr. at 156) (Page ID #8960).
then misappropriated funding from the construction loan.
Ingersoll, his wife Deborah Ingersoll, his son Gayle
Ingersoll, Bradley, and Bradley's wife Tammy Bradley
together completed a series of financial transactions
transferring Chemical Bank loan money through their own
accounts and eventually into Ingersoll's personal
account. From there, Ingersoll reimbursed some of the money
he had earlier improperly withdrawn from GTA for personal
example, on February 7, 2011, Ingersoll and Bradley obtained
a $508, 000 draw on the Chemical Bank loan. R. 397 (Tr. at
50-51, 57) (Page ID #896-61, 8967). Ingersoll then
transferred $400, 000 of that to Bradley's account. R.
393 (Tr. at 89-90) (Page ID #8522-23). Three days later,
Bradley wrote a check for $200, 000 which was deposited into
Gayle Ingersoll's account on February 10, 2011. R. 393
(Tr. at 72-75) (Page ID #8505-08). That same day, Gayle
Ingersoll wrote a check for the same amount which was
deposited into Steven and Deborah Ingersoll's personal
account. R. 393 (Tr. at 76) (Page ID #8509); R. 392 (Tr. at
166) (Page ID #8426). In May 2011, the same actors completed
a similar series of transactions routing $30, 000 to Steven
Ingersoll, who used the funds to purchase real estate. R. 392
(Tr. at 170-71) (Page ID #8430-31); R. 393 (Tr. at 104-06)
(Page ID #8537-39).
2011, over the course of two days, another similar series of
transfers took place. Ingersoll and Bradley initiated a $704,
000 draw on the Chemical Bank line of credit. R. 397 (Tr.
68-72) (Page ID #8978-82). Ingersoll then transferred that
money to Bradley's construction company account. R. 393
(Tr. at 106) (Page ID #8539); R. 397 (Tr. at 73-74) (Page ID
#8983). Next, Tammy Bradley transferred that amount into an
account associated with Gayle Ingersoll. R. 393 (Tr. at 77,
79, 106) (Page ID #8510, 8512, 8539). Gayle Ingersoll then
transferred the same amount into Steven and Deborah
Ingersoll's personal account. R. 393 (Tr. at 86) (Page ID
#8519); R. 389 (Tr. at 85-86) (Page ID #7849-50). Steven
Ingersoll then moved $700, 000 to his SSI account, then to
his SSM account, and lastly to GTA's account on the final
day of the school's fiscal year. R. 393 (Tr. 31-33) (Page
ID #8464-66); R. 389 (Tr. at 88) (Page ID #7852).
Bradley hired indigent employees to work at the BCA
construction site and paid them around $250 to $350 in cash
per week for five or six full days of work. R. 394 (Tr. at
78, 85) (Page ID #8646, 8653); R. 396 (Tr. at 119, 121) (Page
ID #8858, 8860). He did not pay FICA or FUTA taxes on the
wages and did not file W-2s or issue Form 1099s to the
employees. R. 394 (Tr. at 79) (Page ID #8647); R. 396 (Tr. at
95) (Page ID #8834).
and his wife Tammy worked with an employee of H&R Block
to file their 2011 taxes, but failed to provide documentation
to support their income claims. R. 396 (Tr. at 22, 29) (Page
ID #8761, 8768). They repeatedly changed the amounts of
income they claimed by large margins, making one significant
increase soon after Gayle Ingersoll was interviewed by
federal agents as part of the investigation of the present
case. R. 396 (Tr. at 31-32) (Page ID #8770- 71); R. 396 (Tr.
at 41-43) (Page ID #8780-82); R. 389 (Tr. at 86) (Page ID
#7680). At trial, an IRS agent named Michael Wisniewski
testified that even after Bradley and Tammy adjusted their
reported income, they still underreported their actual income
earned in 2011 and accordingly underpaid their tax
obligation. R. 388 (Tr. at 32-34) (Page ID #7626-28).
was indicted in the United States District Court for the
Eastern District of Michigan on April 9, 2014. R. 3
(Indictment at 14) (Page ID #33). He was charged with two
counts: Count 1, Conspiracy to Commit Bank Fraud, in
violation of 18 U.S.C. §§ 1344 and 1349, and Count
2, Conspiracy to Defraud the United States, in violation of
18 U.S.C. § 371. R. 3 (Indictment at 1, 6) (Page ID #20,
25). Steven Ingersoll and Gayle Ingersoll were charged
co-conspirators in Count 2. Id. The indictment
included additional charges against Tammy Bradley, Deborah
Ingersoll, and Steven Ingersoll. Id. On April 23,
2014 the government filed a Superseding Indictment, which
added forfeiture allegations. R. 24 (Superseding Indictment)
(Page ID #75).
to trial, Bradley submitted a motion in limine requesting
that the jury be instructed on the proposed lesser-included
offenses of conspiracy to fail to file W-2s or issue 1099s,
in violation of 26 U.S.C. §§ 7203 and 7204,
respectively. R. 114 (Bradley's Request for Lessor [sic]
Included Offense as to Count Two 18 USC [sic] § 371 at
1) (Page ID #776). The district court declined to rule on
this motion prior to trial. R. 147 (Order Denying Mot. for
Peremptory Challenges and Addressing Mots. in Limine at 6)
(Page ID #1078).
went to trial on February 10, 2015. R. 391 (Voir Dire Tr.).
Bradley was tried jointly with his wife Tammy as well as
Steven, Deborah, and Gayle Ingersoll. At trial, the
government offered the testimony of Agent Michael Wisniewski
of the IRS, who began to testify about the Bradleys'
underreporting and underpaying of their 2011 taxes on Friday,
February 27, 2015. Bradley objected to this testimony,
arguing that it was outside the scope of the indictment,
which did not list Bradley's underpayment of his taxes as
an overt act in furtherance of the conspiracy to defraud the
United States. R. 399 (Tr. at 98-104) (Page ID #9338-44). The
district court stated that it needed more time to review the
underlying law, and prevented Wisniewski from further
testifying on the subject that day. Id. at 104 (Page
ID #9344). The government provided Bradley with additional
information about Wisniewski's intended testimony in the
days that followed. R. 186 (Tr. at 16) (Page ID #1574). When
Wisniewski resumed this testimony on Tuesday, March 3, 2015,
the court ruled that it reasonably fell within the scope of
the conspiracy as charged in Count 2. Id. at 13-24
(Page ID #1571-82).
February 23, 2015, Bradley filed "Proposed Jury
Instructions for Lessor [sic] Included Offense as to Count
Two." R. 142 (Bradley's Proposed Jury Instructions)
(Page ID #1033). This filing failed to propose actual jury
instructions, but rather merely reiterated arguments for the
inclusion of instructions on the proposed lesser-included
offenses discussed in his earlier motion in limine. On March
6, 2015, Bradley was acquitted of Count 1 in a Judgment of
Acquittal. R. 152 (Order Granting in Part and Denying in Part
Mots. for Acquittal) (Page ID #1247). The district court did
not instruct on a lesser-included offense in its final jury
instructions, but did not explain why in the written record.
R. 176 (Jury Instructions at 7) (Page ID #1376). On March 10,
2015 the jury returned a verdict finding Bradley guilty of
Count 2. R. 156 (Verdict Form) (Page ID #1253). On March 24,
2015, Bradley joined Steven Ingersoll's Motion for
Judgment of Acquittal and Motion for New Trial. R. 171 (Def.
Bradley's Joinder in Dr. Ingersoll's Mot. for New
Trial and for J. of Acquittal) (Page ID #1307). The district
court denied the motions for judgment of acquittal and for a
new trial. R. 205 (Order Denying Mots. for New Trial) (Page
ID #2515). Judgment was entered against Bradley, and he
received a sentence of 18 months in custody followed by two
years of supervised release. R. 374 (J. in a Criminal Case at
1-3) (Page ID #7125-27). Bradley timely filed his Notice of
Appeal. R. 375 (Notice of Appeal) (Page ID #7132).
Constructive Amendment or ...