NOT PRECEDENTIAL

       UNITED STATES COURT OF APPEALS
            FOR THE THIRD CIRCUIT
                 _____________

                     No. 13-4815
                    _____________

           UNITED STATES OF AMERICA

                          v.

            BARRETT BYRON STATON,
                               Appellant
                ______________

                     No. 13-4816
                   ______________

           UNITED STATES OF AMERICA

                          v.

                MATTHEW STATON,
                                 Appellant
                  ______________

APPEAL FROM THE UNITED STATES DISTRICT COURT
  FOR THE EASTERN DISTRICT OF PENNSYLVANIA
          (D.C. Nos. 2-10-cr-00800-001 & 002)
       District Judge: Honorable R. Barclay Surrick
                     ______________

       Submitted Under Third Circuit LAR 34.1(a)
                    March 5, 2015
                   ______________

 Before: SHWARTZ, SCIRICA, and ROTH, Circuit Judges.

                (Filed: March 26, 2015)

                   ______________
                                        OPINION*
                                     ______________


SHWARTZ, Circuit Judge.

       Matthew and Barrett Staton appeal their convictions and sentences related to a

fraudulent scheme involving their photocopier brokerage businesses. We will affirm.

                                              I

       Barrett Staton owned copier broker businesses (“Businesses”) that employed

Matthew Staton and William Haken, Jr., as salesmen. Through the Businesses, Barrett

and his team brokered deals between organizations wishing to obtain office copying

equipment and financing companies that fund office copier leases. Their customers

typically completed a lease agreement and credit application for the equipment that

Barrett and his team then submitted to a financing company. If the application was

approved, the financing company provided the Businesses money to purchase and install

the new equipment. The Businesses retained the remainder of the funds as profit.

       To entice customers to enter new leases, Barrett and his team promised

significantly lower monthly rates and other discounts, and offered to buy out the

customers’ existing lease obligations. The Businesses obtained financing for this

purpose, but instead of paying off the obligations on the existing leases, Barrett retained

much of the money. In addition, Barrett and his team altered signed leases and credit

applications to include additional equipment without the customers’ knowledge, and

       *
        This disposition is not an opinion of the full Court and pursuant to I.O.P. 5.7
does not constitute binding precedent.
                                             2
induced their customers to refinance their existing leases with a second financing

company to purportedly obtain a lower monthly payment. The Businesses submitted the

applications to the second financing company as if the applications were to lease a new

copier, in effect obtaining double funding for a single copier and leaving customers liable

for two leases on one machine. Additionally, the Businesses did not return old copiers to

the financing companies as promised, leaving the customer responsible for the unreturned

copier. To perpetuate the scheme, Barrett periodically closed one business and reopened

under a new name using nominees to conceal his involvement.

       The grand jury returned a ten-count superseding indictment against Barrett,

Matthew, and Haken, alleging that they perpetrated this scheme from 2002 to 2011.1 The

indictment charged each defendant with conspiracy to commit wire fraud and wire fraud;

charged Barrett and Haken with three additional three counts of wire fraud; and charged

Barrett with four counts of mail fraud related to his efforts to obtain luxury vehicles, and

one count of making a false statement on a mortgage application.

       Barrett filed various pretrial motions, including motions to dismiss the superseding

indictment based on unconstitutional pre-indictment delay, to suppress evidence seized

from his residence, garage, and storage facility, and to sever counts under Fed. R. Crim.

P. 8 and 14, all of which were denied. Matthew filed a motion to sever his trial from

Barrett’s, which was also denied.




       1
       The original indictment was filed on December 9, 2010, and charged that the
scheme ended in 2008.
                                              3
       Barrett and Matthew were convicted on all counts following a ten-day trial with

testimony from more than forty witnesses, including Haken, who pleaded guilty and

testified for the Government. The District Court sentenced Matthew to sixty months’

imprisonment and a term of supervised release, and Barrett to 108 months’ imprisonment

and a term of supervised release. Matthew and Barrett appeal. 2

                                             II

                                             A

       Barrett contends that the Government violated the Fifth Amendment by waiting

seven years to secure an indictment against him. “[T]he Due Process Clause of the Fifth

Amendment protects defendants against oppressive pre-indictment delay within the

applicable limitations period.” United States v. Sebetich, 

, 430 (3d Cir.

1985). To prevail on a claim of unconstitutional pre-indictment delay, the defendant

must prove that (1) “the government intentionally delayed bringing the indictment in

order to gain some advantage over him” and (2) “this intentional delay caused the

defendant actual prejudice.” United States v. Ismaili, 

, 167 (3d Cir. 1987).

We review the District Court’s findings with respect to these two prongs for clear error.

       Here, Barrett failed to show that the delay in obtaining an indictment was

intentional, and we agree with the District Court that any delay was “attributable to the

process of unraveling the Defendant’s many fraudulent schemes,” Barrett Supp. App.


       2
         The District Court had jurisdiction under 18 U.S.C. § 3231. We exercise
jurisdiction under 28 U.S.C. § 1291 and 18 U.S.C. § 3742.
                                             4
466, which continued until his arrest and thus extended the Government’s investigation.

See 

n.18. Investigative delay of this nature is “fundamentally

unlike delay undertaken by the Government solely ‘to gain tactical advantage over the

accused,’” and thus, “prosecut[ing] a defendant following investigative delay does not

deprive him of due process, even if his defense might have been prejudiced by the lapse

of time.” United States v. Lovasco, 

, 795-96 (1977) (internal quotation

marks and citation omitted). Moreover, the Government is not required to initiate

charges as soon as the requisite proof has been developed because such a rule “would

cause numerous problems in those cases in which a criminal transaction involves more

than one person or more than one illegal act.” 

Because the District Court did

not clearly err in determining that any delay on the part of the Government was not

intentional or used to gain a tactical advantage, it correctly denied Barrett’s motion to

dismiss the indictment.

                                             B

       Barrett also contends that evidence obtained through searches of his residence,

garage, and storage facility should have been suppressed. He raised this argument in a

pretrial motion to suppress, which the District Court denied as untimely and on its merits.

Motions to suppress must be made by the deadline for pretrial motions established by the

district court. Fed. R. Crim. P. 12(b)(3)(C), (c)(1). “If a party does not meet the deadline

for making a [motion to suppress], the motion is untimely,” and deemed waived absent a

showing of “good cause” for the delay. United States v. Rose, 

, 181 (3d Cir.

2008); Fed. R. Crim. P. 12(c)(3).

                                              5
       Barrett filed his motion to suppress more than a month after the District Court’s

deadline for pretrial motions without good cause for the delay. Though Barrett blamed

the delay on “internet difficulties,” this does not explain why he filed his motion to

suppress more than a month after the District Court’s deadline and the date he filed his

other pretrial motions. Barrett Supp. App. 441. The District Court explained that Barrett

“could have filed [the suppression motion] any time after December 14, 2011,” the date

the warrants were unsealed, yet “waited until twelve days before trial” to do so. Barrett

Supp. App. 441. It also noted that Barrett was granted an extension of the pretrial motion

deadline and trial date “so that [he] could become familiar with the discovery materials

and properly prepare his defense.” Barrett Supp. App. 441-42. As Barrett has not

challenged the District Court’s good cause finding and it is supported by the record, we

conclude that the District Court did not abuse its discretion in denying the motion to

suppress as untimely.3

                                             C

       Barrett and Matthew each contend that the District Court erred in denying their

respective motions to sever.4 Barrett premises his claim on the District Court’s failure to

sever counts, while Matthew contends that his trial should have been severed from

Barrett’s trial.




       3
        Because we are affirming the suppression ruling on this basis, we need not
review the merits portion of the ruling.
      4
        We review a district court’s denial of a motion to sever for abuse of discretion.
United States v. Lore, 

, 205 (3d Cir. 2005).
                                              6
       Fed. R. Crim. P. 14 provides that the District Court “may order separate trials of

counts, sever the defendants’ trials, or provide any other relief that justice requires” if

“the joinder of offenses or defendants in an indictment . . . appears to prejudice a

defendant or the government.” Fed. R. Crim. P. 14. To establish a violation of Rule 14,

a defendant must show that the “denial of severance would lead to clear and substantial

prejudice resulting in a manifestly unfair trial.” United States v. Lore, 

, 205

(3d Cir. 2005). A court should therefore grant a severance “only if there is a serious risk

that a joint trial would compromise a specific trial right of one of the defendants, or

prevent the jury from making a reliable judgment about guilt or innocence.” 

marks and citations omitted).

       Neither Barrett nor Matthew has satisfied this “heavy burden.” 

only that he was prejudiced by the joinder of the conspiracy and wire fraud

charges with the mail fraud and false statement charges because “what other conclusion

could be drawn by a jury in determining the manner in which he conducted his business

affairs if not in an allegedly similar fashion.” Barrett Staton Br. 55. Barrett’s “mere[]

speculat[ion] that the jury must have interchangeably applied the evidence presented on

the various counts” is precisely the kind of generalized allegation of prejudice that we

have found insufficient. United States v. Reicherter, 

, 400 (3d Cir. 1981)

(defendant’s allegation that “the jury may have cumulated all the evidence against him”

without distinguishing between drug manufacturing and drug distribution charges failed




                                               7
to establish prejudice). Thus, we find no abuse of discretion in the District Court’s denial

of Barrett’s motion to sever charges.5

       Matthew has also failed to “pinpoint clear and substantial prejudice” from the

joinder of his trial with Barrett’s. See United States v. Riley, 

, 335 (3d Cir.

2010) (internal quotation marks and citations omitted). His contention that his

“involvement in the business and the crimes was far less,” Matthew Staton Br. 10, than

that of Barrett, is insufficient to establish prejudice because “a defendant is not entitled to

a severance merely because evidence against a co-defendant is more damaging than the

evidence against the moving party.” 

(internal quotation marks and

citations omitted). Moreover, there is no evidence to support Matthew’s assertion that

the jury was unable to compartmentalize the evidence presented against Barrett with

respect to the mail fraud and false statement charges. 

. The

evidence in the case was “relatively straight-forward and discrete” and not “overly

technical or scientific.” 

; United States v. Walker, 

,

170-71 (3d Cir. 2011). Furthermore, the District Court instructed the jury to “separately

consider the evidence against each defendant on each of the offenses charged” and told

the jury that its “decision on any one defendant or any one offense . . . should not

influence [its] decision on any of the other defendants or offenses.” Barrett Supp. App.

       5
        Barrett also argues that the conspiracy and wire fraud charges were improperly
joined with the mail fraud and false statement charges under Fed. R. Crim. P. 8(b). We
review Rule 8(b) joinder de novo, “focus[ing] on the indictment, not on the proof
subsequently adduced at trial.” United States v. Eufrasio, 

, 567 (3d Cir.
1991). Because the superseding indictment shows that these counts are all part of the
same scheme, the counts were properly joined. See United States v. Walker, 

, 170 (3d Cir. 2011).
                                               8
264. Jurors are presumed to follow their instructions, Richardson v. Marsh, 

, 211 (1987), and we have no reason to doubt that they did so here. We therefore find

that the District Court did not abuse its discretion in denying Matthew’s motion to sever.

                                             D

       Barrett contends that the use of computer records at trial and sentencing violated

his Sixth Amendment Confrontation Clause rights because he “was unable to cross

examine [the] computer.”6 Barrett Staton Br. 24. He also complains that the witnesses

who “read the computer records . . . lacked the personal knowledge that the computer

apparently had” and the Government failed to “produce the actual data bases or computer

records upon which [the] testimony was based.” Barrett Staton Br. 23. Barrett seems to

suggest that the witness against him was the computer. In fact, the witness against him

was the agent who testified about the contents of the computer. 7 The agent explained

how the computer was searched, identified the computer records obtained from it, and

properly authenticated them. These records were then admitted and the witness was

subject to cross-examination. Thus, testimony about the admission of these records did

not violate Barrett’s Confrontation Clause rights. 8


       6
          This part of Barrett’s computer confrontation clause argument fails because the
Confrontation Clause is only implicated by hearsay statements, and since a “statement is
something uttered by ‘a person,’ . . . nothing said by a machine . . . is hearsay.” United
States v. Khorozian, 

, 506 (3d Cir. 2003) (internal quotation marks and
citations omitted).
        7
          To the extent the District Court limited Barrett’s ability to cross-examine a
witness, we review for abuse of discretion. United States v. 

.
        8
          To the extent Barrett also claims that the Government violated its disclosure
obligations, his claim fails. The District Court correctly found that the Government
fulfilled its disclosure obligations when it allowed Barrett and his counsel to inspect the
                                             9
                                              E

       Barrett next contends that the District Court violated Fed. R. Evid. 404(b) by

admitting evidence of his failure to file federal income taxes from 2003 through 2008.9

Rule 404(b) prohibits admission of other bad acts evidence, meaning acts other than those

charged in or that facilitated the crimes charged in the indictment. Rule 404(b), however,

does not apply to intrinsic bad acts evidence, i.e., evidence that (1) “directly proves the

charged offense;” or (2) demonstrates “uncharged acts performed contemporaneously

with the charged crime [that] facilitate the commission of the charged crime.” See

United States v. Green, 

, 248-49 (3d Cir. 2010). Evidence that Barrett failed

to file federal income taxes together with his use of multiple business fronts from which

he received criminally derived income enhanced his ability to conceal his scheme and its

proceeds from law enforcement. Because his nonfilings constitute contemporaneous acts

that facilitated the commission of the fraudulent scheme, the evidence is intrinsic, and




computer hard drives and electronic devices, provided Barrett with hard drives containing
electronic copies of the files, and “took steps to resolve the [software] issues” with the
hard drives by both “provid[ing Barrett] with a laptop, install[ing] forensic software,” and
“purchas[ing] new accounting software.” Barrett Supp. App. 416.
        Matthew’s access to the computer records also undermines his claim that the
Government violated Brady v. Maryland, 

(1963). Because Matthew failed to
identify the evidence to which he purportedly lacked access or describe how this
evidence was material or exculpatory, he is not entitled to relief under Brady. See
generally United States v. Pelullo, 

, 209 (3d Cir. 2005).
        9
          “We review the District Court’s evidentiary rulings principally on an abuse of
discretion standard,” but “exercise plenary review to the extent such rulings are based on
a legal interpretation of the Federal Rules of Evidence.” United States v. Green, 

, 239 (3d Cir. 2010).
                                             10
hence relevant, to the charges against him,10 and the District Court did not abuse its

discretion in admitting it.

                                             F

       Barrett next contends that the District Court erred in denying his motion for

judgment of acquittal on his conviction for conspiracy to commit wire fraud.11 “To prove

a conspiracy, the government must show: (1) a shared unity of purpose; (2) an intent to

achieve a common illicit goal; and (3) an agreement to work toward that goal.” United

States v. Caraballo-Rodriguez, 

, 425 (3d Cir. 2013) (en banc).

       Haken’s testimony about the scheme provided sufficient evidence to convict

Barrett of conspiracy to commit wire fraud. Haken testified that, at Barrett’s direction, he

offered to buy out the Businesses’ customers’ pre-existing leases, “promis[ing] that [he

and Barrett] would take the remaining payments . . . owed by that customer and [] pay

them off in full,” Barrett Supp. App. 110, but knowing that the leases “were not going to

get paid off.” Barrett Supp. App. 101. Haken also testified that Barrett devised a plan for

what they called “flip deals,” in which they promised to pay off their current customers’

existing leases and obtain new leases for the same equipment at a lower price with a


       10
           Even if we held that this evidence was extrinsic, it would nonetheless be
admissible under Rule 404(b) because it helps prove Barrett’s intent to defraud his
customers. United States v. Saada, 

, 223-24 (3d Cir. 2000).
        11
           We exercise plenary review over the denial of a judgment of acquittal. United
States v. Caraballo-Rodriguez, 

, 424 (3d Cir. 2013) (en banc). In reviewing
the evidence, “we draw all reasonable inferences in favor of the jury verdict,” which we
will overturn “only if no reasonable juror could accept [the] evidence as sufficient to
support the conclusion of the defendant’s guilt beyond a reasonable doubt.” United
States v. Anderskow, 

, 251 (3d Cir. 1996) (internal quotation marks and
citations omitted).
                                             11
different financing company. Barrett Supp. App. 115. Haken explained that they did not

in fact pay off the existing leases and Barrett, the “primary contact” for the financing

companies, did not inform the new financing companies that the Businesses had already

leased the same piece of equipment using another financing company. Barrett Supp.

App. 111.

       Haken also testified that Barrett used fake names when interacting with the

financing companies because of “problems” he had had at a “previous company.” Barrett

Supp. App. 112. He also testified that Barrett asked him to sign and file corporate papers

needed to secure a new vendor. When Haken hesitated and told Barrett that, as the

owner, Barrett should do it, Barrett explained that he could not “because of his past

history” and offered to pay Haken $10,000 to sign and file the papers. This testimony is

sufficient to support Barrett’s conspiracy conviction.

                                             G

       Lastly, Barrett and Matthew appeal their sentences.12 Because Matthew’s

challenge is foreclosed by United States v. Freeman, 

(3d Cir. 2014),13 we

need only examine Barrett’s challenge to the procedural and substantive reasonableness

       12
           We review the District Court’s sentencing decision for abuse of discretion.
United States v. Freeman, 

, 335 (3d Cir. 2014).
        13
           The District Court did not violate Alleyne v. United States, 

(2013), when it, rather than the jury, determined the number of victims, the loss amount
resulting from the fraud, and that the fraud involved “sophisticated means,” as none of
these findings “result[ed] in imposition of a mandatory minimum sentence.” 

(internal quotation marks and citations omitted). Rather, they only
“influence[d] the sentencing judge’s discretion in imposing an advisory Guidelines
sentence” and resulted in a sentence “within the statutorily prescribed range.” 

marks and citations omitted). Therefore, Alleyne is not implicated,
and we will affirm Matthew’s sentence.
                                             12
of his sentence. The party challenging the sentence bears the burden to show

unreasonableness. United States v. Figueroa, 

, 278 (3d Cir. 2013).

       Barrett first contends that the District Court erred in imposing a sixteen-point

increase to his base offense level under U.S.S.G. § 2B1.1(b) because there was

insufficient evidence to support its calculation that $2,070,529.74 in losses resulted from

Barrett’s fraud.

       The Government must establish the amount of the loss by a preponderance of the

evidence. United States v. Ali, 

, 145 (3d Cir. 2007). Once the Government

establishes a prima facie case, the burden of production shifts to the defendant, although

the ultimate burden of persuasion remains with the Government. United States v. Evans,

, 253 (3d Cir. 1998). The district court “need only make a reasonable

estimat[ion] of the loss,” U.S.S.G. § 2B1.1 cmt. 3(C), which we review for clear error,

reversing only if the loss finding is “completely devoid of a credible evidentiary basis or

bears no rational relationship to the supporting data.” United States v. Vitillo, 

, 330 (3d Cir. 2007) (internal quotation marks and citations omitted).

       Here, the evidence was sufficient to support the District Court’s loss finding. At

the sentencing hearing, an FBI agent testified that he obtained the loss figures from

interviews with and affidavits prepared by the victims. This method provided an

adequate basis for concluding that the loss figures “bear some minimal indicium of

reliability beyond mere allegation,” such that the District Court could rely on them at




                                             13
sentencing. United States v. Smith, 

, 117 (3d Cir. 2014) (internal quotation

marks and citations omitted).14

         Barrett’s remaining contentions regarding the loss amounts, particularly that the

agent lacked certain information regarding particular loans, failed to account for tax

benefits the victims received, and was unsure about the nature of certain loss amounts,

are insufficient to disturb the District Court’s finding. “Although it is possible that the

Government made errors in the course of its calculations, there is no reason to think that

its figure was not a ‘reasonable estimate’ of the loss, established by a preponderance of

the evidence.” United States v. Fumo, 

, 310 (3d Cir. 2011). Regardless,

Barrett has not shown that the purported inaccuracies would reduce the loss amount to a

figure below $1,000,000, the amount that triggers a lower enhancement, and therefore,

any such errors would be harmless. United States v. Jimenez, 

, 89 (3d Cir.

2008).

         Barrett also contends that the District Court erred in imposing a sentencing

enhancement pursuant to U.S.S.G. § 2B1.1(b)(10). Section 2B1.1(b)(10) provides for a

two-point enhancement if the offense “involved sophisticated means.” The Commentary

defines “sophisticated means” as “especially complex or especially intricate offense

conduct pertaining to the execution or concealment of an offense” and provides that


          Nor are we persuaded that the agent’s statement that he tried to keep certain
         14

calculations “as simple as possible” or Barrett’s expert’s statement that without
supporting documentation, there was insufficient data to “independently validate” the
victim affidavits renders the District Court’s loss finding “completely devoid of a
credible evidentiary basis.” 

(internal quotation marks and
citations omitted).
                                              14
“[c]onduct such as hiding assets or transactions, or both, through the use of fictitious

entities, corporate shells, or offshore financial accounts [] ordinarily indicates

sophisticated means.” U.S.S.G. § 2B1.1(b)(10), cmt. n9(B). The enhancement applies

“when the conduct shows a greater level of planning or concealment than a typical fraud

of its kind.” 

(internal quotation marks and citations omitted).

       Barrett employed “sophisticated means” to commit his fraud by operating multiple

shell companies, using fictitious names, and submitting fraudulent documents to avoid

detection. See 

(use of “sham entities . . . to conceal the flow of

funds” supports the sophisticated means enhancement); United States v. Cosgrove, 

, 667 (6th Cir. 2011) (“repeated use of fictitious identities can justify a

sophisticated means enhancement, particularly when the identity is reinforced through

other deceptive practices.”). We therefore find no abuse of discretion in the District

Court’s application of the enhancement.

       We also find no merit in Barrett’s suggestion that the District Court failed to

meaningfully consider the § 3553(a) sentencing factors implicated by the testimony of his

character witnesses and the hardship the sentence would impose on his family. At

sentencing, the District Court spoke directly to the concerns Barrett raises on appeal,

specifically addressing “the nature of the defendant,” noting that it had “no doubt” that

Barrett was a “good father” and “loving husband,” and lamenting that Barrett’s family

would “suffer mightily” as a result of Barrett’s conduct.15 Barrett Supp. App. 282.


        The District Court also properly considered Barrett’s lack of remorse and
       15

acceptance of responsibility, see United States v. King, 

, 195 (3d Cir. 2006),
                                              15
Although the District Court did not directly reference the statements of Barrett’s pastor

and other character witnesses, the District Court implicitly rejected their statements about

Barrett’s reformed character when it noted Barrett’s “absolute denial” of wrongdoing. 

the District Court meaningfully considered the § 3553(a) factors.

       Barrett’s sentence of 108 months’ imprisonment is also substantively reasonable.

A sentence is substantively reasonable “unless no reasonable sentencing court would

have imposed the same sentence on that particular defendant for the reasons the district

court provided.” United States v. Tomko, 

, 568 (3d Cir. 2009). As

discussed above, the District Court appropriately considered the § 3553(a) sentencing

factors in imposing a within-Guidelines sentence. In particular, it expressed a “real

concern” that Barrett’s “absolute denial” of wrongdoing was an indication that he would

re-offend. Barrett Supp. App. 282-83. Citing a need to “protect the public,” the District

Court determined that “a sentence at the low end of the sentencing Guidelines” would be

sufficient to “deter others from engaging in this kind of conduct” and “protect the public

while [Barrett] is in jail.” Barrett Supp. App. 283. As the District Court “reasonably

applied,” United States v. Bungar, 

, 543 (3d Cir. 2007), the sentencing

factors and considered the multi-year fraud he perpetuated against numerous victims, we

cannot say that “no reasonable sentencing court would have imposed the same sentence.”

. We will therefore affirm Barrett’s sentence.


and did not err in not considering Barrett’s period of house arrest. The District Court
lacks the authority to credit that time toward Barrett’s sentence and, in any event, home
confinement is not official detention and hence not creditable. Blood v. Bledsoe, 

, 206 (3d Cir. 2011).
                                            16
                                     III

For the foregoing reasons, we will affirm the judgments of the District Court.




                                     17