United States v. Hollnagel (955 F. Supp. 2d 830, 2013)

United States District Court for the Northern District of Illinois 2013-07-01

Citations

Full opinion text

MEMORANDUM OPINION AND ORDER

AMY J. ST. EVE, District Judge.

Defendants Brian Hollnagel and BCI Aircraft Leasing, Inc. have moved for a judgment of acquittal (R. 467) and for a new trial (R. 498, 531) on Counts One, Two, Three, Four, Five, Six, and Twelve of the Second Superseding Indictment. For the reasons explained below, the Court denies Defendants’ motion for judgment of acquittal. The Court also denies Defendants’ motion for a new trial.

BACKGROUND

I. General Background

The government charged Defendants Brian Hollnagel (“Hollnagel” or “Defendant”) and BCI Aircraft Leasing, Inc. (“BCI”) (collectively, “Defendants”) in the Second Superseding Indictment “with having engaged in a long-term scheme to defraud investors, lenders, and others of money and property by engaging in a fraudulent scheme to obtain financing and enrich themselves.” (R. 545, Resp. at 6.) Specifically, the Second Superseding Indictment charged Defendants with six counts of wire fraud and two counts of obstruction of justice. The charges arose from loans and investments Defendants obtained in conjunction with BCI’s business of buying, selling and leasing commercial airplanes. Mr. Hollnagel was the owner, president and chief executive officer of BCI. Co-Defendant Craig Papayanis held various positions at BCI, including managing director and chief financial officer.

The government submitted a redacted renumbered indictment based on the Second Superseding Indictment (the “Renumbered Indictment”) for the jury to use during its deliberations. (R. 480.) Count One of the Renumbered Indictment charged Mr. Hollnagel with participating in a scheme to defraud AAR Corp., a corporation involved in the sale and leasing of commercial aircraft, in part based on payments Mr. Hollngal gave to an AAR Corp. employee, Brian Olds, to help facilitate aircraft deals between BCI and AAR Corp. Count Two of the Renumbered Indictment charged Mr. Hollnagel and BCI with participating in a scheme to defraud investors, financial institutions, and others. Counts Three through Six of the Renumbered Indictment charged Defendants with wire fraud based on wires used in furtherance of the scheme charged in Count Two. Count Seven of the Renumbered Indictment charged Defendants with obstruction of justice based on documents which Defendants submitted to the SEC containing false statements relating to Defendants’ investments. Count Eight of the Renumbered Indictment charged Defendants with obstruction of justice based on false statements Defendants made to the SEC regarding payments made to Robert Carlsson, a licensed securities broker.

II. Procedural History

On January 18, 2012, the Court conducted jury selection and proceeded to trial in this case. The trial lasted for approximately seven weeks. During the course of the trial, the government called twenty-two witnesses and admitted over six hundred exhibits into evidence. Specifically, the government called the following witnesses: Gary Turlington, Dean Olds, Barrey Davis, Joseph Sammons, Jim Cullen, Rob Carlsson, Frank Czajka, John Taflan, John Strokirk, Frank Meyer, Thomas Berwick, Jay Johnson, John Poulton, T.D. Butzbaugh, John VanDerMeulen, Dean Matt, James Erwin, David Storch, Robert Denninger, Peter Haleas, William Conagh, and Nicole Bilicki.

On February 24, 2012, at the close of the government’s case-in-chief, Defendants Brian Hollnagel and BCI moved for a judgment under Rule 29 of the Federal Rules of Criminal Procedure. (R. 467.) The Court took their motion under advisement and continued the trial. (R. 468.) Defendants called five witnesses: Lois Cavero, William Sakamoto, Quentin Brasie, Gary Turlington, and Thomas Berwick.

On March 14, 2012, following almost two weeks of deliberations, the jury returned a verdict of guilty as to Defendant Hollnagel on Count One, and verdicts of guilty as to Defendants Hollnagel and BCI on Counts Two, Three, Four, Five, Six and Seven of the Renumbered Indictment. The Court entered a judgment of guilty against those Defendants in accordance with the jury verdict. The jury was unable to return a unanimous verdict as to Defendants Hollnagel and BCI on Count Eight of the Renumbered Indictment, nor was the jury able to return a unanimous verdict as to Co-Defendant Craig Papayanis on Counts Two, Three, and Four of the Renumbered Indictment. The Court declared a mistrial as to those counts.

On August 1, 2012, Defendants filed a supplemental memorandum in support of their motion for judgment of acquittal pursuant to Rule 29 of the Federal Rules of Criminal Procedure. (R. 530.) That same day, Defendants filed a motion for a new trial pursuant to Rule 33 of the Federal Rules of Criminal Procedure. (R. 531.) Defendants’ motion for a new trial incorporates and exclusively relies upon the arguments that Defendants make in their motion for a judgment of acquittal. The Court, therefore, considers both motions simultaneously.

LEGAL STANDARD

1. Motion for Judgment of Acquittal— Rule 29

Rule 29(a) provides that, “[a]fter the government closes its evidence or after the close of all the evidence, 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). When, as here, a defendant makes a Rule 29(a) motion at the close of the government’s ease, and the court reserves decision, the court “must decide the motion on the basis of the evidence at the time the ruling was reserved.” Fed.R.Crim.P. 29(b).

“In challenging the sufficiency of the evidence, [a defendant] bears a heavy, indeed, nearly insurmountable, burden.” U.S. v. Warren, 593 F.3d 540, 546 (7th Cir.2010); see also U.S. v. Jones, 713 F.3d 336, 339-40 (7th Cir.2013); U.S. v. Berg, 640 F.3d 239, 246 (7th Cir.2011); U.S. v. Dingo, 609 F.3d 904, 907 (7th Cir.2010); U.S. v. Morris, 576 F.3d 661, 665-66 (7th Cir.2009). The reviewing court will view the “evidence in the light most favorable to the prosecution,” and the defendant “ ‘must convince’ the court that, even in that light, ‘no rational trier of fact could have found him guilty beyond a reasonable doubt.’ ” Warren, 593 F.3d at 546 (quoting U.S. v. Moore, 572 F.3d 334, 337 (7th Cir.2009)); see also U.S. v. Eller, 670 F.3d 762, 765 (7th Cir.2012); U.S. v. Doody, 600 F.3d 752, 754 (7th Cir.2010) (stating that the inquiry is “whether evidence exists from which any rational trier of fact could have found the essential elements of a crime beyond a reasonable doubt”). In other words, a court will “set aside a jury’s guilty verdict only if ‘the record contains no evidence, regardless of how it is weighed,’ from which a jury could have returned a conviction.” U.S. v. Presbitero, 569 F.3d 691, 704 (7th Cir.2009) (quoting U.S. v. Moses, 513 F.3d 727, 733 (7th Cir. 2008)); see also Warren, 593 F.3d at 546.

It follows that under Rule 29, courts “do not reassess the weight of the evidence or second-guess the trier of fact’s credibility determinations.” U.S. v. Arthur, 582 F.3d 713, 717 (7th Cir.2009); see also U.S. v. Severson, 569 F.3d 683, 688 (7th Cir.2009). This strict standard is a recognition that “[s]orting the facts and inferences is a task for the jury.” Warren, 593 F.3d at 547. The Seventh Circuit teaches that:

[t]he critical inquiry on review of the sufficiency of the evidence to support a criminal conviction must be not simply to determine whether the jury was properly instructed, but to determine whether the record evidence could reasonably support a finding of guilt beyond a reasonable doubt. But this inquiry does not require a court to ask itself whether it believes that the evidence at the trial established guilt beyond a reasonable doubt. Instead, the relevant question is whether, after viewing the evidence in the light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt.

Moore, 572 F.3d at 337 (quoting Jackson v. Virginia, 443 U.S. 307, 318-19, 99 S.Ct. 2781, 61 L.Ed.2d 560 (1979)).

II. Motion for a New Trial — Rule 33

Rule 33 of the Federal Rules of Criminal Procedure provides that, “[ujpon the defendant’s motion, the court may vacate any judgment and grant a new trial if the interest of justice so requires.” Fed. R.Crim.P. 33(a); see also U.S. v. Smith, 674 F.3d 722 (7th Cir.2012) (reviewing a district court’s order on a Rule 33 motion for abuse of discretion); U.S. v. McGee, 408 F.3d 966, 979 (7th Cir.2005). “ ‘[Cjourts have interpreted [Rule 33] to require a new trial in the interests of justice in a variety of situations in which the substantial rights of the defendant have been jeopardized by errors or omissions during trial.’ ” U.S. v. Eberhart, 388 F.3d 1043, 1048 (7th Cir.2004) (quoting U.S. v. Kuzniar, 881 F.2d 466, 470 (7th Cir.1989)), overruled on other grounds, 546 U.S. 12, 126 S.Ct. 403, 163 L.Ed.2d 14 (2005).

“ ‘A jury verdict in a criminal ease is not to be overturned lightly, and therefore a Rule 33 motion is not to be granted lightly.’ ” Eberhart, 388 F.3d at 1048 (quoting U.S. v. Santos, 20 F.3d 280, 285 (7th Cir.1994)). The court may grant a new trial if the jury’s “verdict is ‘so contrary to the weight of the evidence that a new trial is required in the interest of justice.’” U.S. v. Washington, 184 F.3d 653, 657 (7th Cir.1999) (“The focus in a motion for a new trial is not on whether the testimony is so incredible that it should have been excluded. Rather, the court considers whether the verdict is against the manifest weight of the evidence, taking into account the credibility of the witnesses.”); see also U.S. v. Chambers, 642 F.3d 588, 592 (7th Cir.2011). Put another way, “[t]he court should grant a motion for a new trial only if the evidence ‘preponderate[s] heavily against the verdict, such that it would be a miscarriage of justice to let the verdict stand.’ ” U.S. v. Swan, 486 F.3d 260, 266 (7th Cir.2007) (quoting U.S. v. Reed, 875 F.2d 107, 113 (7th Cir.1989)).

ANALYSIS

I. Judgment of Acquittal Is Not Appropriate On Count One

Count One charged Defendant Hollnagel with devising, and intending to devise, “a scheme to defraud AAR and its shareholders of money and property by means of materially false and fraudulent pretenses, representations, and promises, and by material omissions,” in violation of 18 U.S.C. §§ 2 and 1343. To establish wire fraud under Section 1343, the government had to prove that (1) Defendant Hollnagel participated in a scheme to defraud; (2) Defendant Hollnagel had the intent to defraud; and (3) Defendant Hollnagel used interstate wires in furtherance of the fraud. U.S. v. Sheneman, 682 F.3d 623, 628 (7th Cir.2012). Specifically, Count One charged that Mr. Hollnagel wired $250,000 to Mr. Olds — from Fifth Third Bank to Bank One — on March 11, 2005 in furtherance of the scheme.

Mr. Hollnagel argues that the jury erred in convicting him on Count One for three reasons: (1) the government did not prove the intent element; (2) the government, at most, proved an uncharged honest services fraud, rather than fraud to deprive AAR of money or property; and (3) the government did not link Mr. Hollnagel to any material omission or misrepresentation to AAR or establish that he had a duty to disclose to AAR payments given to AAR’s employee, Brian Olds. (R. 530, Supp. Mem. at 8.) Viewing the evidence in the light most favorable to the government, however, the evidence supported the jury’s verdict on Count One.

A. The Evidence Supported a Finding That Defendant Hollnagel Intended to Deprive AAR of Money and Property

“[I]ntent to defraud requires a wilful act by the defendant with the specific intent to deceive or cheat, usually for the purpose of getting financial gain for one’s self or causing financial loss to another.” Sheneman, 682 F.3d at 629 (citing U.S. v. Howard, 619 F.3d 723, 727 (7th Cir.2010); U.S. v. Britton, 289 F.3d 976, 981 (7th Cir.2002)). “The intent to defraud may be proven by circumstantial evidence and inferences drawn from the scheme itself.” U.S. v. Jackson, 540 F.3d 578, 594 (7th Cir.2008). The evidence at trial supported the jury’s finding that Defendant Hollnagel intended to defraud AAR by paying Mr. Olds — an AAR ■ employee — to close deals between Defendant Hollnagel and AAR, to benefit Defendants at the sake of AAR.

In 2004, BCI sold two aircraft (the “US Airways Planes”) to AAR Corporation in a joint venture with Goldman Sachs, and in 2005, BCI purchased three aircraft from AAR (the “Continental Planes”). Brian Olds worked for AAR in 2004 and 2005. In 2004, Mr. Hollnagel contacted Mr. Olds and offered to sell the two U.S. Airways Planes to AAR. Mr. Olds testified that he informed Mr. Hollnagel that AAR would pay BCI $7.7 million per aircraft ($15.4 million total), as that met AAR’s “economic hurdles.” (Trial Tr. 322:1-12, 324:1-2.) According to Mr. Olds, Mr. Hollnagel offered to pay him personally $125,000 per U.S. Airways Plane if the deal closed. (Trial Tr. 320:3-35, 543:1-3.) In December 2004, AAR purchased the two U.S. Airways Planes from BCI for a total of $15.4 million. (Gx Olds 17; Gx Olds 18; Trial Tr. 334:13-15, 335:23-336:1.) Similarly in late 2004, Mr. Hollnagel called Mr. Olds regarding the sale of the three Continental Planes. (Trial Tr. 342:9-343:5.) Mr. Olds, who pled guilty and was coopering with the government, testified that Mr. Hollnagel again offered him money, specifically $60,000 per aircraft, to shepherd the deals through to completion. (Trial. Tr. 343:18-22, 543:7-8.) After AAR approved the sale to BCI of the Continental Planes in February 2005, Mr. Hollnagel paid Mr. Olds as promised. (Trial Tr. 352:4-356:2, 542:15-20.)

At trial, the government argued that Mr. Olds intended to deprive AAR of money because Mr. Hollnagel paid money to Mr. Olds rather than factoring that amount into the purchase price of the planes he had bought from and sold to AAR. In other words, Mr. Olds took money off the negotiation table to AAR’s detriment. Here, Defendant Hollnagel argues that the government presented “no evidence, aside from unfounded assumptions, that the money paid to Mr. Olds would have ever been paid to AAR on the two transactions.” (Supp. Mem. at 8.) The Court disagrees.

The Court instructed the jury that it could make reasonable inferences based on the evidence. (Trial Tr. at 7970.) The jury could reasonably have inferred that Mr. Hollnagel’s payments to Mr. Olds deprived AAR of money or property because even Mr. Olds testified that there was “room in the negotiation” for a better price, namely “the money that was paid to [him], at a minimum.” (Trial Tr. 325:18-25.) Mr. Old’s testimony that Mr. Hollnagel did' not seem willing to put more money into the deal (Trial Tr. 547:8-11) does not undercut this inference by the jury because (1) Mr. Olds did not know what Mr. Hollnagel would have done and (2) Mr. Hollnagel may not have wanted to put more money in the deal merely because he was already paying Mr. Olds.

Additionally, the testimony of AAR’s Chairman David Storch supported the conclusion that Mr. Hollnagel deprived AAR of money. ' Mr. Storch testified, for example, that he would have expected Defendants to have paid to AAR, at a minimum, the $180,000 which Mr. Hollnagel covertly gave to Mr. Olds after AAR sold the Continental Planes to BCI. (Trial. Tr. 5448:12-5449:7.) He also testified that the $250,000 that Mr. Hollnagel paid Mr. Olds regarding the U.S. Airways Planes transaction should have gone to AAR, specifically to its joint venture with Goldman Sachs. (Trial Tr. 5449:8-12.) Mr. Storch further testified that he would not have approved the transactions if he had known that Mr. Hollnagel promised to pay Mr. Olds upon their completion. (Trial Tr. 5448:6-15.)

Furthermore, although Defendant Hollnagel wanted the jury to believe that he paid Mr. Olds because of a friendly relationship whereby Mr. Olds helped the younger Mr. Hollnagel understand the aircraft industry, the jury could have reasonably inferred a fraudulent intent rather than accepting this innocuous alternative theory. (Supp. Mem. at 8-9 (citing Trial Tr. 238:10-239:17).) Indeed, the evidence showed that Mr. Olds kept Mr. Hollnagel up-to-date on AAR’s internal, confidential communications regarding the Continental Planes transaction. Specifically, Mr. Olds forwarded an email from Chairman Storch to Mr. Hollnagel where Mr. Storch was questioning whether to complete the Continental Planes sale to BCI. (Gx Olds 22; Trial Tr. 350:1-12.) In the text of his email to Mr. Hollnagel, Mr. Olds said “Damage control is now required. I will discuss with Tim and David. However, I sense a real problem here I am not sure just how to process yet. Give me a call. Brian.” (Gx Olds 22; Trial Tr. 350:15-19.) Mr. Hollnagel forwarded this email to BCI’s CFO Craig Papayanis and instructed him to delete the email after he read it. (Gx Olds 22.) The jury reasonably could have inferred from this communication with Mr. Olds, and Mr. Hollnagel’s attempt to hide it by telling Mr. Papayanis to delete the email, that Mr. Hollnagel had an illicit intent to manipulate AAR in the transactions.

The jury also heard evidence that Mr. Olds sent Mr. Hollnagel confidential information regarding a joint venture between AAR and Goldman Sachs, in part, according to Mr. Olds, to let Mr. Hollnagel know what he was doing. (Trial Tr. 483:14-24, 484:6-9.) Mr. Olds also provided Mr. Hollnagel with other confidential information, about unrelated aircraft and transactions, beginning at least in 1998. (Trial Tr. 229-34.) Based on Mr. Olds’ willingness to share AAR’s internal and confidential information, the jury may have inferred that the nature of Mr. Hollnagel’s and Mr. Olds’ relationship was not merely one based on mentoring and camaraderie as Defendants assert. (Supp. Mem. at 18 (citing Trial Tr.: 238:16-24).) Indeed, the jury reasonably could have concluded that Mr. Hollnagel and Mr. Olds were acting to AAR’s detriment, or, at a minimum, without AAR’s best interests in mind. These reasonable inferences support a conclusion that, per Mr. Hollnagel’s request, Mr. Olds “shepherded” the deal to Mr. Hollnagel’s benefit. Indeed, Mr. Hollnagel found Mr. Olds’ “shepherding” services worthy of two separate payments for two separate transactions. Athough Mr. Hollnagel challenges Mr. Olds’ credibility, it is not up to the Court to find him incredible. Moreover, the Court instructed the jury to view his testimony with “caution and great care.” (R. 473, Jury Instruc. at 13.)

Defendant Hollnagel argues that he did not benefit from the payments to Mr. Olds as the financing for the U.S. Arways deal became worse and worse for BCI as the deal progressed. (Supp. Mem. at 12.) The evidence described above, however, supported a finding that Mr. Hollnagel valued closing the deal above all else, and utilized Mr. Olds to accomplish that end. Such a conclusion is reasonable in part because Mr. Hollnagel’s business relied on attracting investors to invest in various aircraft.

The jury likely rejected the testimony of Defendant’s expert, Quentin Brasie, in part because Defendant paid Mr. Braise $121,000 to testify as his expert. Additionally, Mr. Brasie never inspected anything except other people’s reports. (Supp. Mem. at 15-16; Trial Tr. 7231:24-7232:1.) In addition to testifying that the structure of the Continental deal forced BCI to find less favorable financing than originally contemplated, Mr. Brasie testified that AAR would not have benefitted from a sale price any higher than the $15.4 million which BCI paid. (Trial Tr. 7279:11-7280:10.) Specifically, Mr. Brasie testified that AAR had an agreement with ICON Capital “through which any residual value in the three aircraft over $13,775 million went directly to ICON.” (Trial Tr. 7274:18-7275:2.) The Court cannot assess the credibility of Mr. Brasie.

Even if the jury accepted Mr. Brasie’s testimony, it still reasonably could have concluded that Mr. Hollnagel had the intent to defraud AAR. The fact that AAR’s collateral agreements — about which Mr. Hollnagel may not have been aware — may have prevented Mr. Hollnagel from succeeding in depriving AAR of funds because the funds would have gone to ICON does not undercut Mr. Hollnagel’s intent to defraud. See, e.g., U.S. v. Aslan, 644 F.3d 526, 545 (7th Cir.2011) (“The wire fraud statute punishes the scheme, not its success. The fraud is therefore complete once a defendant with the requisite intent has used the wires in furtherance of a scheme to defraud, whether or not the defendant actually collects any money or property from the victim of the scheme.”) (citing Pasquantino v. U.S., 544 U.S. 349, 371, 125 S.Ct. 1766, 161 L.Ed.2d 619 (2005); U.S. v. Lorefice, 192 F.3d 647, 655-56 (7th Cir.1999); U.S. v. Coffman, 94 F.3d 330, 333 (7th Cir.1996); U.S. v. Strozier, 981 F.2d 281, 285 (7th Cir.1992)). Indeed, the Court instructed the jury that “[t]he wire fraud statute can be violated whether or not there is any loss or damage to the victim of the crime or gain to the defendant.” (Jury Instruc. at 26; Trial Tr. 7977:15-17.)

Defendant Hollnagel’s citation to United States v. Ballard, 663 F.2d 534 (5th Cir. 1981), to establish that he could not have intended to deprive AAR of money because of his agreement with ICON is unavailing. (Supp. Mem. at 16.) First, Ballard, which is not binding on the Court, was an honest services fraud case involving kickbacks, and, therefore, fundamentally differs from the circumstances of this case. Second, Defendant Hollnagel concedes that in Ballard the Fifth Circuit reversed the wire fraud convictions because the price controls in effect, which capped the profits that the victims of the scheme would have received even if there were no kickbacks, made the disclosure of the kickbacks immaterial. (Supp. Mem. at 16 (citing Ballard, 663 F.2d at 541-42).) Here, however, as explained further below, the jury heard testimony from Mr. Storch that at least he, a decision-maker at AAR on the relevant transactions, would have found it material that Mr. Hollnagel paid Mr. Olds to “shepherd” the deals. Indeed, he specifically testified that he would not have approved the deals if he had known this information. (Trial Tr. 5448:3-15.) Viewing the evidence in the light most favorable to the government, the jury had more than sufficient evidence to find the misrepresentation material.

Defendant HollnageFs reliance on United States v. Ashman, 979 F.2d 469, 479 (7th Cir.1993), is equally unhelpful because, unlike the victims in Ashman, AAR had an opportunity to obtain a better price for the aircrafts. (Supp. Mem. at 16-17.) As discussed above, Mr. Olds testified that he believed AAR left money on the table— at least the amount Mr. Hollnagel paid him — and Mr. Storch believed that Hollnagel would have paid more for the planes based on his payments to Mr. Olds. (Trial Tr. 5448:12-5449:12.) Although Defendant Hollnagel correctly notes that “speculation is not a substitute for proof beyond a reasonable doubt,” based on the evidence before it, the jury reasonably could have inferred that Mr. Hollnagel intended to defraud AAR of money or property, via Mr. Olds, even if AAR in fact lost no money or property. (Supp. Mem. at 18.)

B. The Jury Convicted Defendant Hollnagel of Depriving AAR of Money or Property, Not Honest Services Fraud

Defendant Hollnagel argues that the jury improperly convicted him of an uncharged honest serviced fraud, rather than a scheme to defraud AAR of money or property, because the government lacked evidence of Defendant HollnageFs intent. (Supp. Mem. at 19.) This argument fails because, as discussed above, there was sufficient evidence for the jury to find intent. Moreover, Defendant Hollnagel bases his argument entirely on quotations from the government’s opening and closing statements. The Court, however, instructed the jury that the attorneys’ opening and closing statements were not evidence. (Trial Tr. 12:10-13; 7562:22-25.) The Court presumes that a jury follows its instructions. Sorich v. U.S., 709 F.3d 670, 678 (7th Cir.2013) (citing Christmas v. City of Chi., 682 F.3d 632, 641 (7th Cir .2012)).

Contrary to Defendant HollnageFs contention, the government did not present a theory that “any payment a contracting party makes to a counter-party’s employee necessarily constitutes pecuniary fraud,” but, rather, offered evidence that Mr. Hollnagel intended to deprive AAR of money or property by funneling money to Mr. Olds rather than utilizing those funds while negotiating with AAR in the U.S. Airways and Continental transactions. (Supp. Mem. at 21, 24.) Indeed, portions of the government’s opening statement— which Defendant does not cite — explicitly set out the government’s theory regarding the money and property of which Mr. Hollnagel intended to deprive AAR. The government stated, for example:

AAR was also cheated out of money that’s represented by the hundreds of thousands of dollars that Hollnagel paid in bribes to Olds. You see, because while Olds is putting money in his own pocket, there’s still money on the table — the bargaining table — between BCI and AAR that is lost as a result of the money that is going into Olds’ pocket as a result of these bribes.

(Trial Tr. 22:14-20.) Notably, the government did not merely argue that Mr. Olds violated his duty of loyalty to AAR by accepting a kickback or bribe, but instead contended that Mr. Olds took money off the bargaining table that belonged to AAR. In fact, the Seventh Circuit in U.S. v. Holzer, to which Defendant cites, differentiated the case before it from a case where a defendant “diverted to his own pocket money intended for his employer.” 840 F.2d 1343, 1348 (7th Cir.1998) (cited by Defendants at Supp. Mem. at 25). Here, the jury could have reasonably concluded that Mr. Hollnagel paid Mr. Olds to complete the transactions at the prices which Mr. Hollnagel wanted, rather than at prices utilizing the funds that Mr. Hollnagel paid Mr. Olds.

Moreover, unlike McNally v. U.S., 483 U.S. 350, 360, 107 S.Ct. 2875, 97 L.Ed.2d 292 (1987), the indictment charged Defendants specifically with a scheme to defraud AAR of money or property, not honest services, and the Court instructed the jury accordingly. Specifically, the Court instructed the jury that “[a] scheme to defraud is a scheme that is intended to deceive or cheat another or to obtain money or property or cause the potential loss of money or property to another ...” (Jury Instruc. at 22; see also Trial Tr. 7976:11-15.) As a result, here, unlike in Magnuson v. U.S, relied upon by Defendant Hollnagel, “it is [not] wholly unrealistic to believe that the jury either found or was required to find a deprivation of money or property before rendering guilty verdicts.” 861 F.2d 166, 168 (7th Cir.1988).

C. The Government Sufficiently Proved that Defendant Hollnagel Made Material Misrepresentations or Omissions to AAR

“A scheme to defraud requires the making of a false statement or material misrepresentation, or the concealment of a material fact.” Sheneman, 682 F.3d at 628-29 (citing U.S. v. Powell, 576 F.3d 482, 491-92 (7th Cir.2009)) (internal quotation marks omitted). Defendant Hollnagel argues that the government failed to prove this essential element. (Supp. Mem. at 26.) The evidence showed, however, that, prior to the sale of the U.S. Airways Planes, Defendant Hollnagel signed a purchase agreement containing misrepresentations. Specifically, the purchase agreement stated that no “person acting on such party’s behalf is entitled to any brokerage fee ... or commission” in connection with the transaction. (Gx Olds 17, Sec. 6.1; Gx Olds 18, Sec. 6.1.) As explained above, the evidence showed that Mr. Hollnagel had promised to pay (and did pay) Mr. Olds $250,000 in connection with the transaetion. Viewing this evidence in the light most favorable to the government, a rational jury could view the plain language of the purchase agreement as encompassing the prohibited payments which Mr. Hollnagel obligated himself to pay Mr. Olds in connection with the transactions. Indeed, Defendant Hollnagel concedes that “given how BCI characterized its payments to Mr. Olds in its own records, a rational juror could have concluded that the fees Mr. Olds received were akin to brokers’ fees, in contravention of this provision in the purchase agreement.” (Supp. Mem. at 28 (internal citations omitted).)

' Defendant Hollnagel misguidedly argues that “[tjhis provision could not be the material misrepresentation supporting a conviction on Count One [because] ... [t]he government’s theory was that Mr. Olds and Mr. Hollnagel omitted to tell AAR about the payments, not that Mr. Hollnagel misrepresented whether brokers were used in the U.S. Airways transaction.” (Sum. Mem. at 28.) As previously explained, however, the government’s theory was that Mr. Hollnagel paid Mr. Olds money — regardless of whether it is labeled a bribe, a broker’s fee, or a commission — to obtain his help to shepherd and close the U.S. Airways and Continental' transactions.

Defendant Hollnagel also argues that there was “no evidence whatsoever that this provision, found under ‘Miscellaneous’ provisions at the end of the purchase agreement was material to AAR’s decision to purchase the U.S. Airways [P]lanes, or the price at which the purchase was made.” (Supp. Mem. at 29.) At a minimum, this argument misinterprets the law regarding “material”, misrepresentations and disregards testimony from Mr. Olds and Mr. Storch. Under the law, “[a] false statement is material if it has a natural tendency to influence, or [is] capable of influencing, the decision of the decisionmaking body to which it was addressed ... The statement need not actually affect the decision.” U.S. v. Grigsby, 692 F.3d 778, 785 (7th Cir.2012) (citing U.S. v. Lupton, 620 F.3d 790, 806 (7th Cir.2010)); see also Neder v. U.S., 527 U.S. 1, 16, 119 S.Ct. 1827, 1837, 144 L.Ed.2d 35 (1999); U.S. v. Jackson, 546 F.3d 801, 816 (7th Cir.2008) (finding that because “[the victim] ultimately did not actually rely on the defendants’ representations ... does not render their statements immaterial.”). The Court instructed the jury consistent with the law. (Jury Instruc. at 24.) Whether or not AAR actually relied upon the misrepresentation in the “Miscellaneous” provision, therefore, is not determinative. What matters is whether this misrepresentation had the capability of influencing the decision-makers at AAR.

As explained above, Mr. Stórch, a decision-maker at AAR, testified that he would not have approved the' sale of the U.S. Airways Planes had he known that Mr. Hollnagel had agreed to pay Mr. Olds if the deal closed. (Trial Tr. 5448-49.) Mr. Storch’s testimony not only assisted the jury in determining what influence such a misrepresentation would have had on AAR, but Mr. Storch provided direct testimony as to how this information would have affected AAR. The evidence, therefore, supported the materiality of the misrepresentations to AAR.

Moreover, even if the jury did not find that this provision of the purchase agreement was a sufficient misrepresentation, it is within reason for the jury to have concluded that Mr. Hollnagel omitted material information, namely that he was paying an AAR employee regarding the transaction. As the Court instructed the jury, “a materially false or fraudulent pretense, representation, or promise may be. accomplished by an omission or concealment of material information.” (Jury Instruc. at 22; Trial Tr. 7976:16-18.) Defendant Hollnagel spends pages in his brief arguing that Mr. Hollnagel’s omissions or concealment cannot constitute fraud because neither Mr. Olds nor Mr. Hollnagel had a duty to inform AAR of their relationship and payment agreement. (Supp. Mem. at 26-28.) He fails to cite, however, any case law requiring a duty to exist in order for an omission to constitute a material omission. Indeed, no such absolute requirement exists. See, e.g., U.S. v. Palumbo Bros., Inc., 145 F.3d 850, 868 (7th Cir. 1998) (“We also have determined that the omission or concealment of material information, even when a statute or regulation does not impose a duty to disclose, constitutes mail fraud.”); Emery v. Am. Gen. Fin., Inc., 71 F.3d 1343, 1346-47 (7th Cir. 1995) (finding “that omissions or concealment of material information can constitute fraud cognizable under the mail fraud statute, without proof of a duty to disclose the information pursuant to a specific statute or regulation.”) (quoting U.S. v. Keplinger, 776 F.2d 678, 697 (7th Cir.1985)). Rather, “whether a failure to disclose is “fraudulent” depends on context.” Emery, 71 F.3d at 1347 (citing U.S. v. Biesiadecki, 933 F.2d 539, 542-43 (7th Cir.1991)); see, e.g., Powell, 576 F.3d at 491 (finding material misrepresentations and omissions included failure to disclose the “whole story” about a transaction, including that defendants would pocket proceeds from the resale of the property they bought from victim for significantly less, in part because victim said he would not have completed the transaction if she knew of one of the omissions). The context here — which included concealment, as explained below, a larger scheme to defraud, a business transaction, and repeated interactions between Mr. Hollnagel and Mr. Olds — supported a conclusion that Mr. Hollnagel fraudulently omitted material information to AAR during their business dealings. Moreover, the evidence showed that Mr. Hollnagel’s omission regarding his payments to Mr. Olds was material to AAR’s decision to proceed with the transactions, as specifically noted by Mr. Storch.

The evidence also supported the conclusion that Mr. Hollnagel attempted to conceal his payments to Mr. Olds. Indeed, the jury may have viewed Defendant Hollnagel’s inclusion of the above provision in the purchase agreement as an attempt to conceal the payments, which, notably, Mr. Hollnagel sent to a shell company that Mr. Olds created called Mercury Air Corp. (Trial Tr. 341:13-342:1; Gx Olds 33); see Powell, 576 F.3d at 491 (finding that “a failure to disclose information may constitute fraud if the omission is accompanied by acts of concealment.”) (quotation omitted). Furthermore, Mr. Olds even admitted that Mercury Air Corp. became merely a “shell to receive bribe payments from BCI and Brian Hollnagel.” (Trial. Tr. at 250-51.) Although there was no direct evidence that Mr. Hollnagel knew that Mercury Air Corp. was a shell, the jury may have made a reasonable inference regarding Mr. Hollnagel’s knowledge because Mr. Hollnagel would have known the players in the industry, and thus would have known whether Mercury Air Corp. did legitimate business. Defendant Hollnagel wanted the jury to believe that he paid Mr. Olds via Mercury Air Corp. because Mr. Olds acted as a professional consultant for Mr. Hollnagel, rather than as a complicit bribee. The Court, however, will not second-guess the jury’s weighing of the evidence because they could have rationally concluded that Mr. Hollnagel’s failure to disclose the payments constituted a material omission in the context of his previous dealings with Mr. Olds and repeated payments to him. Viewing the evidence in the light most favorable to the government, the government submitted more than ample evidence at trial to support the wire fraud charge in Count One.

II. The Evidence Supported the Jury’s Verdict on Counts Two through Four Against Defendants Hollnagel and BCI

The jury convicted Defendants Hollnagel and BCI on Counts Two through Six of the indictment, which charged them with a scheme to defraud “investors, financial institutions, and others.” As discussed above, to establish wire fraud under Section 1343, the government had to prove that (1) Defendants participated in a scheme to defraud; (2) Defendants had the intent to defraud; and (3) Defendants used interstate wires in furtherance of the fraud. Sheneman, 682 F.3d at 628. Defendants argue that the evidence adduced at trial did not show that Counts Two through Six constituted a single scheme to defraud and did not establish that Defendants had the requisite fraudulent intent.

Notably, as discussed below, Defendants repeatedly make two misguided arguments in an attempt to undercut the jury’s convictions on Counts Two through Six. First, Defendants argue that the jury could not have found intent to defraud, or a fraudulent scheme, because the government did now show that any investor or bank lost any money or property. As detailed below, however, the law does not require any loss to occur to sustain a conviction. Second, Defendants rely heavily on the notion that the investment and loan documents at issue gave Defendants authority or discretion to make the allocations or distributions that they made. Defendants fail to recognize that the representations in these documents do not preclude the possibility that Defendants made representations, outside of the documents, to the investors about what they would do with that authorization or discretion. The Court addresses the sufficiency of the evidence supporting Counts Two through Six below.

A. The Government Adduced Sufficient Evidence of a Single Scheme as Alleged in Count Two

Defendants claim that “no rational juror weighing the evidence introduced on the Count Two scheme could conclude that it was a single scheme ... [because] [t]he only unifying thread in Count Two is that the alleged ‘scheme’ was to raise, and either retain or use, money.” (Supp. Mem. at 31-32.) Defendants further argue that the variance between the allegations of a single scheme and the proof at trial prejudiced them. (Supp. Mem. at 31.) There was no prejudicial variance, however, between the indictment and the evidence adduced at trial.

1. There Was No Variance

A variance arises “when the facts proved at trial differ from those alleged in the indictment.” U.S. v. Scheuneman, 712 F.3d 372, 378 (7th Cir.2013) (quoting U.S. v. Longstreet, 567 F.3d 911, 918 (7th Cir. 2009)). Defendants argue that the government cannot aggregate numerous acts together into a single scheme connected only by Defendants’ universal involvement and the fact that Defendants committed each action to raise, retain or use money. (Supp. Mem. at 31-32; Reply at 34.) Specifically, Defendants contend that the allegation relating to Coast is a “stand-alone allegation more along the lines of an uncharged and time-barred honest services fraud.” (Id. at 32.) Defendants further argue that the allegations relating to Coast, Bridgeview Bank, and AAR are disconnected schemes, each utilizing different means and with different victims. (Id. at 32-34.) According to Defendants, the “remainder of the alleged scheme was a full scale assault on BCI’s business practices— including entirely lawful conduct — from its commingled bank account, insufficiently documented substitution of aircraft, shareholder loans, LLCs that were ‘under water,’ oversubscription, and so on.” (Id. at 35). Defendants asserted that these various actions, which could all be considered “accounting failures,” are dissimilar and are unrelated to the allegations relating to Defendants’ conduct with Coast, Bridge-view Bank, and AAR. (Id.) As explained in the Court’s prior ruling regarding Defendants’ claim that the indictment was duplictous, however, a scheme to defraud may be carried out through many different means. (R. 275 at 17 citing U.S. v. Davis, 471 F.3d 783, 790 (7th Cir.2006)).

Here, the fraudulent conduct included in Count Two involved the same parties and had a “sufficiently close nexus with one another” to be “fairly characterized as one scheme.” U.S. v. Zeidman, 540 F.2d 314, 317 (7th Cir.1976) (citing U.S. v. Palladino, 475 F.2d 65, 74-75 (1st Cir.1973)). As the Court previously explained, “Defendants here all possessed the same goal — to obtain financing for BCI and to enrich themselves. Furthermore, the counts simply charge that Defendants carried out their scheme to defraud through various means, namely, misrepresentations and misappropriations, bribes, and concealment.” (R. 275 at 18.) The evidence at trial was consistent with the allegations in the Second Superseding Indictment that Defendants carried out the scheme to defraud through these various means to obtain funds for themselves. Furthermore, Defendants fail to explain how the facts proved at trial vary from the those alleged in Count Two, and instead merely rehash their pre-trial argument that Count Two alleges multiple, independent schemes rather than one scheme to defraud.

2. Even If There Were Variance, It Was Not Fatal

Even assuming, arguendo, that the government’s proof at trial varied from that charged in Count Two, Defendants have not established any prejudice or harm the Defendants experienced based on the alleged variance. “A variance is fatal only when the defendant is prejudiced in her defense because she cannot anticipate from the indictment what evidence will be presented against her or she is exposed to double jeopardy.” U.S. v. Howard, 619 F.3d 723, 727 (7th Cir.2010) (citing U.S. v. Ratliff-White, 493 F.3d 812, 820 (7th Cir.2007)).

As explained above, Count Two charged Defendants with a single fraudulent financing scheme, that included multiple acts over many years, and the government submitted evidence to the jury on such a scheme. Defendants, therefore, had the ability to prepare for trial on the government’s allegations, particularly in light of the Court’s previous ruling on Defendants’ motion claiming the indictment was duplicitous which put Defendants on notice regarding the scope of the charged scheme.

Defendants analogize their case to a 1946 case, Kotteakos v. U.S., 328 U.S. 750, 766-67, 66 S.Ct. 1239, 90 L.Ed. 1557 (1946), where the Supreme Court found that the proof at trial established multiple conspiracies, rather than one cohesive conspiracy as charged. (Supp. Mem. at 36-37.) In Kotteakos, the indictment charged numerous defendants, who each participated in separate conspiracies, in one count, thereby alleging one unified conspiracy based on the participation of one defendant in all of the separate conspiracies. As a result, the Supreme Court found that the defendants faced a prejudicial burden in preparing for trial as they had to prepare defenses to numerous separate schemes to which they had no connection. Id. at 766-67. The trial judge in Kotteakos also gave the jury a misleading jury instruction, confusing the proof necessary to establish that the defendants participated in a single conspiracy. Id. at 767. Furthermore, the Supreme Court explained that the problem was “not merely one of variance between indictment and proof ... but [was] also essentially one of proper joinder.” Id. at 774.

Notably, the crux of the Kotteakos case was the breadth of the alleged conspiracy, which initially included thirty-two defendants, and the imputation of guilt from one defendant to the group as a whole. Here, the two Defendants, who are actually one entity, were tried along with one Co-Defendant — Mr. Papayanis — and did not face the same burdens and prejudice as the defendants in Kotteakos, who, as Defendants note, had the obligation of “looking out for and securing safeguard against evidence affecting other defendants.” (Supp. Mem. at 37 (citing Kotteakos, 328 U.S. at 767, 66 S.Ct. 1239).) Rather, here, Defendants participated in every facet of the charged scheme. Defendants offer no examples or explanations of how the alleged variance prejudicially burdened their ability to prepare a defense.

Defendants also argue, without explanation, that “[t]he sheer number of schemes shoehorned into Counts Two through Six also improperly increased the ‘likelihood of jury confusion,’ another indicator of prejudice.” (Supp. Mem. at 37 (citing U.S. v. Bustamante, 493 F.3d 879, 887 (7th Cir. 2007).)) Specifically, Defendants do not articulate what issues may have caused jury confusion or why a rational jury could not determine “the existence of at least one of the false or fraudulent pretenses, representations, or promises charged in the portion of the Indictment describing the scheme” based on the presentation of multiple pretenses, representations, or promises involving Defendants. See, e.g., U.S. v. Quintanilla, 2 F.3d 1469, 1481 (7th Cir.1993) (“It is well settled that, even if the evidence presented at trial arguably established multiple conspiracies, there is no material variance from an indictment charging a single conspiracy if a reasonable juror could have found beyond a reasonable doubt the single conspiracy charged in the indictment.”).

The only specific prejudice Defendants note in their memorandum is that the alleged “aggregation of several distinct schemes into a single overarching ‘scheme’ allowed the jury to convict Brian Hollnagel and BCI without finding that the particular wires charged in the indictment were connected to any fraud scheme the just may have found existed.” (Supp. Mem. at 37.) This argument is misguided.

First, the Second Superseding Indictment charged one specific wire transfer in each count. The jury, therefore, must have found sufficient evidence of each wire transfer in order to convict Defendants on each count.

Second, Defendants’ fear that the jury improperly “mixed and matched together” the wire transfers with different parts of the scheme contradicts the explicit instructions the Court gave the jury. (Supp. Mem. at 37.) Because the jury convicted the Defendants on Counts Two through Six, it concluded that a scheme to defraud existed, the confines of which they determined based on the evidence and which included at least one of, but possibly all of, the acts in furtherance of the scheme. The Court presumes, therefore, that the jury followed its instructions and concluded that Defendants used each alleged wire transfer to carry out the scheme. See Sorich, 709 F.3d at 677 (“we presume that a jury follows its instructions”). Furthermore, as explained in part in Section III, the evidence supported the jury’s finding.

Defendants also contend that the alleged variance created a risk that Defendants could be prosecuted twice for the same offense. (Sum. Mem. at 38.) According to Defendants, it is impossible to know what conduct the jury found to constitute the scheme because the Court did not instruct the jury that it must unanimously find at least one part of the alleged scheme. (Id.) Such an instruction, however, was not necessary. Before trial, Defendants objected to the government’s proposed jury instruction number twenty-seven and attempted to add language requiring the jury to unanimously agree regarding which materially false or fraudulent pretense, representation, promise, or material omission each defendant made. (R. 353.) After the parties briefed the issue, the Court rejected Defendants’ argument. (R. 427.) Indeed, the Ninth Circuit has stated that Defendants’ “argument is foreclosed by a long line of cases; the jury need not be unanimous on the particular false promise.” U.S. v. Lyons, 472 F.3d 1055, 1068 (9th Cir.2007) (citing U.S. v. Woods, 335 F.3d 993, 998-99 (9th Cir.2003) (“Under the mail fraud statute the government is not required to prove any particular false statement was made.”)). The Comment for the draft July 2011 Seventh Circuit Jury instruction 4.04, which Defendants cited in their objection, does not alter the Court’s analysis. In that comment, the Committee explained that a court must require unanimity on each element of an offense, but not on the means by which the defendant committed the element. Furthermore, the Committee elaborated:

The Committee notes that it is common for mail, wire, and bank fraud charges to include allegations regarding multiple false statements, promises, or representations. Since Richardson, the Seventh Circuit has not spoken on the issue of whether, in a case, unanimity on the particular false statement, promise, or representation is required. Though it is likely that these constitute allegations regarding a means, not an element, of the offense (the element being the existence of a scheme, not the particulars how the scheme was executed), the Committee takes no definitive position on the point.

(emphasis added). The Seventh Circuit recently explained that:

Specific unanimity instructions ... are necessary only when there is a significant risk that the jury would return a guilty verdict even if there were less than unanimity with regard to one or more elements of the crime. There was not a significant risk here, given the weight of the evidence of both elements (if they are indeed elements and not means).

U.S. v. Schiro, 679 F.3d 521, 533 (7th Cir.2012).

Here, there was no significant risk that the jury would return a guilty verdict with less than unanimity as to the elements of the offense, specifically the element that Defendants used a fraudulent misrepresentation or pretense. Indeed, the Court instructed the jury that the government needed to prove each element of each particular count against each particular Defendant beyond a reasonable doubt in order to return a guilty verdict. (Jury Instruc. at 21; Trial Tr. 7981:17-1782:1.) The Court also gave the jury the general unanimity instruction. (Jury Instruc. at 47; Trial Tr. 7989:12-13.) As a result, there was no prejudicial variance regarding Counts Two through Six.

B. The Evidence Supported the Convictions on Counts Two Through Six

Defendants argue that the evidence at trial did not show that they intended to defraud investors, banks, or anyone else, as required for a conviction on Counts Two through Six. (Supp. Mem. at 38.) Specifically, Defendants argue that the government blurred the line between Defendants, who claim they paid investors everything they were entitled to, and Jason Hyatt, who stole money from investors, a crime for which he pled guilty. (Supp. Mem. at 39.) As explained below, however, viewing the evidence in the light most favorable to the government, there was sufficient evidence to support a rational jury’s guilty verdict on Counts Two through Four.

1. Intent to Defraud Bridgeview Bank

The government presented evidence of four false representations in loan documents that Defendants submitted to Bridgeview Bank in connection with a $2.85 million loan in 2004. (Resp. at 21-22.) Specifically, in the loan documents Defendants falsely represented:

• that BCI held 100% of the membership interest in BCI Investment 2002-1;

• that BCI had pledged the pledgor’s membership interest in BCI Investment 2002-1, which was 100% of the total membership interest in BCI 2002-1;

• that BCI would pay to Bridgeview Bank all funds available to BCI Investment 2002-1, and not commingle its assets; and

• that Defendants would not take investors into BCI Investment 2002-1 without prior notice to, and approval from, Bridgeview Bank.

(Resp. at 22; Gx KLM Loan 2; Trial Tr. 1385:13-1386:20,1422.) Defendants do not dispute that Mr. Hollnagel signed the loan documents containing the first two false statements. Rather, Defendants contend that “[w]hat the government never proved is that Defendants made intentionally false statements to Bridgeview, and the circumstances negated any rational inference that Defendants acted with requisite intent to defraud.” (Supp. Mem. at 42.)

Defendants argue that there was no rational reason for them to lie to Bridgeview, as “Bridgeview was eager to lend money to BCI” and Mr. Hollnagel would be risking his own money if Defendants made false representations to Bridgeview. (Supp. Mem. at 42-43.) Neither of these arguments, however, preclude a reasonable conclusion by the jury that Defendants took steps to secure loans with Bridgeview Bank.

First, Bridgeview Bank’s desire to work with BCI is not mutually exclusive with a desire by Defendants to obtain loans from Bridgeview. Based on the evidence, a rational jury could have inferred that Defendants, who had significant long-term debt obligations in 2004, made false statements in the loan documents in order to secure financing. Indeed, the inference that Defendants took whatever action was necessary to secure financing is consistent with the rest of the scheme to defraud which centered around obtaining financing. Defendants, for example, continued to raise money from investors for the KLM transaction after obtaining the loan, without giving notice to Bridgeview Bank, as promised. (Resp. at 23; Gx KLM Chart 1.) The jury reasonably concluded, therefore, that Defendants made misrepresentations to Bridgeview to ensure Bridgeview executed the loan. This conclusion also supports a finding that Defendants had the intent to defraud Bridgeview. See Jackson, 540 F.3d at 594 (“Falsifying information on loan documents is circumstantial evidence of intent to defraud.”).

Second, although it is true that Mr. Hollnagel personally indemnified Bridge-view against any fraud or misrepresentation, pursuant to a Validity and Indemnification Agreement, this personal pledge does not necessarily undermine an inference that Mr. Hollnagel intended to mislead Bridgeview to obtain financing. (Trial Tr. 2397:6-8, 2397:16-24; Gx KLM Loan 2 at BBG-BCI042194-97.) The jury could have concluded that someone willing to make misrepresentations, would be willing to risk that those misrepresentations would never be discovered and he would never be liable. Although Defendants offer a reasonable alternative interpretation of Mr. Hollnagel’s behavior, the Court must view the evidence in the light most favorable to the government.

In addition, Defendants argue that there was no evidence that Mr. Hollnagel participated in drafting or reviewing the loan documents containing the misstatements and therefore, even though the statements were false, he did not intentionally falsify the documents. (Supp. Mem. at 44.) Mr. Hollnagel signed the documents, however, at least ten times. (Gx KLM Loan 2.) Although there was no direct evidence that Mr. Hollnagel read and processed each term, it was reasonable for the jury to infer, based, in part, on their common sense, that the company’s owner, president and chief executive officer — who was very hands-on in running the company — would affix his signature onto loan documents after understanding their contents. Furthermore, there was no evidence to support the contrary inference — that Mr. Hollnagel did not know the contents of the document he signed — such as testimony that he had a practice of signing documents without reading them. As a result, Defendants have not met their “onerous burden” of showing that the record is “devoid of evidence from which a reasonable jury” could have concluded that Defendants intended to include misrepresentations in the documents. U.S. v. Vallone, 698 F.3d 416, 486 (7th Cir.2012).

Defendants also attempt to undermine the jury’s conclusion by pointing to a red-line correction by someone at BCI of a line in a commitment letter issued to BCI and subsequently sent to a Bridgeview loan officer (the “Red-Lined Commitment Letter”). Specifically, Defendants try to show that BCI attempted to use the Red-Lined Commitment Letter to correct a misrepresentation that appeared in the Bridgeview Bank loan documents. According to Defendants, this attempted-correction indicates that they would not have intentionally made the misrepresentations in the loan documents. The red-line correction, however, was not part of the loan documents itself and only dealt with one specific issue — that BCI would only pledge the borrower’s membership interest in BCI Investment 2002-1, rather than 100 % of the total membership. (Supp. Mem. at 45.) This correction, therefore, does not “negate] any inference that the mistake in the other document was intentional.” (Supp. Mem. at 45.) Furthermore, different individuals at BCI may have prepared the two documents — the Red-Lined Commitment Letter and the Bridgeview Bank loan — with different intentions. Mr. Hollnagel also signed the loan documents after Defendants sent the Red-Lined Commitment Letter, which he did not author, correct, or perhaps ever review. (Gx KLM Loan 2.) Viewed in the light most favorable to the government, the evidence was sufficient for the jury to draw the conclusion that Mr. Hollnagel and BCI intended to defraud Bridgeview Bank by making false misrepresentations to obtain a loan.

2. Intent to Defraud Investors

The deal Defendants offered to investors consisted generally of the following: (1) investors would invest in an airplane with BCI, which would purchase planes on lease to airlines; (2) BCI would pay investors a monthly preferred return; and (3) BCI would pay investors 50% of the profits from the sale of the airplane. (Supp. Mem. at 49; Resp. at 19.) The government presented evidence that Defendants defrauded investors by raising funds for investment LLCs where: (1) BCI never purchased the planes, or (2) the investors never held any interest in the planes. (Resp. at 19.) The evidence, viewed in the light most favorable to the government, sufficiently supported a finding that Defendants intended to defraud the investors.

Defendants, both at trial and in their briefs, argued that there was no scheme to defraud because the investors did not lose any money but instead received all of the money to which their agreement with BCI entitled them. As explained above, however, this argument is misguided because a scheme to defraud can exist even if no victim actually suffered any loss of money or property. See, e.g., Aslan, 644 F.3d at 545. What matters is whether Defendants intended to defraud the investors.

Defendants argue that the jury should have interpreted the evidence as demonstrating that “BCI had insufficient controls, systems, and manpower to run its complex business,” rather than an intent to defraud. (Supp. Mem. at 50.) The Court’s “job, however, is not to reweigh the evidence nor second-guess the jury’s credibility determinations” based on an alternative theory of the case. U.S. v. White, 698 F.3d 1005, 1013 (7th Cir.2012). Rather, the Court must “view the evidence in the light most favorable to the government and ask whether any rational jury could have found the essential elements of the charged crime beyond a reasonable doubt.” Id. The Court addresses the evidence relating to each investment in turn.

a. SAS Transaction — BCI 2003-2, LLC

In 2003, BCI issued investment invitations for BCI Investment 2003-2, offering an opportunity to invest in BCI’s acquisition of a 737-400 on lease to SAS Airlines. (Supp. Mem. at 50.) As part of that deal, Defendants agreed to pay investors a distribution from the net lease payment — also called the free cash flow — which was the difference between the lease payment from SAS Airlines and the debt payment to the lender. (Trial Tr. 2544:15-2445:1.) Defendants, however, never purchased the SAS aircraft. ' BCI did not inform the BCI Investment 2003-2 investors that it did not purchase the SAS aircraft, unless they specifically asked. (Trial Tr. 1181:8-18, 1265:16-24, 1295:19-23.) Instead, Defendants paid BCI Investment 2003-2 investors from other funds. (Trial. Tr. 2567:16-2568:12.) Mr. Hollnagel did not even inform Jay Johnson, the principal of BCI’s largest investor, Hyatt Johnson Capital, that BCI had failed to purchase the SAS plane until years later during an August 29, 2007 phone call. (Trial Tr. 2776:18-22; 2780:3-2781-5.)

BCI’s financial records from Fifth Third Bank established that BCI paid the BCI Investment 2003-2 investors from the BCI 2003-1 SAS fund (“SAS Fund”) — the fund into which those investors’ funds had originally been deposited — rather than from any net lease payments. (DX 3235; Gx SAS Chart 1.) In total, the BCI Investment 2003-2 investors had deposited $3,803,000 into the SAS Fund. (Resp. at 20.) In addition to paying the investors $515,924 from the SAS Fund, as if it were a monthly distribution based on the net lease payments from the SAS aircraft, BCI used money from the SAS Fund to