In United States v. David T. Shulick, 994 F.3d 123 (3d Cir., April 13, 2021), the Third Circuit affirmed convictions and sentence for embezzling funds from a federally funded program, conspiracy, bank fraud, and making false statements. Shulick operated a for-profit education company that, among other things, contracted with the School District of Philadelphia to manage its Southwest School, which served at-risk students. Shulick received $2 million to put in place specific services: 6 teachers with set salaries and benefits, security workers, and counselors. Shulick only spent $1.186, did not provide these full services or positions, and directed the money instead to pay off liabilities for other businesses. He was convicted by a jury and appealed on speedy trial grounds, errors in evidentiary rulings, faulty jury instructions, and sentencing miscalculations. The Third Circuit Court rejected all these challenges:
II. The evidentiary rulings were not erroneous. The District Court rightfully excluded an agency clause in the contract and other irrelevant evidence. While the contract explicitly said the “contractor does not function as an agent of the School District,” the Court ruled this clause irrelevant because the parties “cannot bind the federal government in a criminal trial by simply saying they’re not agents of one another.” Indeed, Shulick was given significant managerial control over the administration of the school, which clearly showed he was an agent of the organization receiving federal funds under §666(a)(1)(A). Further, the district court properly excluded certain expert testimony because he was an untimely-disclosed expert witness.