Nathan Hardwick was a real estate attorney in Georgia who managed the “closing side” of the real estate law firm practice. The law firm sold part of its foreclosure operation to a private equity group for 14 to 15 million dollars but within a few years Hardwick’s portion of the money was gone from misfortune that included the 2008 financial crises, gambling, and a bad divorce. He owed millions in loans he could not repay. To satisfy his creditors Hardwick turned to conduct that led to federal criminal charges.
To repay a bank and casino debt, Hardwick lied to a bank in a line-of-credit application claiming that there were no lawsuits pending against him. Even worse, he siphoned off about $26 million from the law firm including $19 million from the law firms’ trust account, while hiding the withdrawal from other shareholders. To accomplish this theft, he relied heavily on Asha Maurya, who Hardwick promoted by to the position of CFO giving her authority over the trust accounts. At Hardwick’s request she repeatedly sent money from the law firm to Hardwick or his creditors and significantly underreported the law firm distributions to Hardwick. Eventually the scheme unraveled when an internal audit revealed an altered bank account. Both were indicted by a grand jury of wire fraud, conspiracy to commit wire fraud and making false statements to a federally insured financial institution. Maurya pled guilty. Hardwick went to trial and was convicted. Hardwick received a 180-month sentence and Maurya received an 84-month sentence.
In this appeal, Maurya challenged her sentence because the district court applied a sentence enhancement under the Sentencing Guidelines that did not exist at the time the offense was committed. The sentencing court used a two-level substantial financial hardship enhancement that was added to the Sentencing Guidelines in 2015, but Maurya’s offense ended in August of 2014. The court of appeals reversed the sentence and ordered a resentencing because this was an ex post facto violation under the U.S. Constitution.
Hardwick’s appeal he included a series of challenges to his federal criminal conviction. Hardwick claimed he was entitled to a bill of particulars that included a battery of questions. The appeals court upheld the trial court’s denial because it found that the indictment sufficiently informed Hardwick of the charges against him to adequately prepare for his defense and minimize surprise at trial. He challenged the trial court’s decision to exclude a stack of evidence of Maury’s bad acts which he wanted to offer to support his argument that Maurya was the mastermind and sole participant in the scheme to defraud the law firm. The appeals court upheld the trial court’s decision under the discretionary power of the trial judge to exclude and/or limit the evidence Hardwick wanted to offer.
The appeals court rejected Hardwick’s challenge to the deliberate ignorance jury instruction which he argued was improperly given because the government’s theory was that Hardwick was fully aware of the fraud and participated in the conspiracy. But because the jury was also instructed that it could convict Hardwick based on actual knowledge, it found any error to be harmless.
Finally, the appeals court rejected Hardwick’s challenge that the sentence was substantively unreasonable because the trial court departed upwards from a 108 to 135-month range to a 180-month sentence. It found the trial court considered all the factors of 18 U.S.C. section 3553(a). It just gave the mitigating factors less weight than Hardwick would prefer. The trial court acted within its discretion in imposing the upward departure because of Hardwick’s egregious behavior, his lack of remorse, and that his crimes affected so many people who suffered losses.