A federal judge has restricted prosecutors’ use of a June 2020 contract proposal in the woodpile fraud case against Davidson and Sasha Charlemagne, while provisionally excluding earlier payment records and certain recorded statements. The October 6 ruling gives prosecutors another opportunity to justify admitting the records and statements before the case proceeds toward a November trial.
U.S. District Judge Mark A. Kearney partly granted a motion filed by Davidson Charlemagne, finding that the government had not established the required connection between three challenged categories of evidence and the charged offenses. Further arguments on the payment records and statements are scheduled for the October 29 final pretrial conference.
The prosecution stems from a V.I. Housing Finance Authority contract to store and manage lumber brought to the territory for hurricane recovery. Prosecutors allege that D&S Trucking, operating as a subcontractor to Island Services Group LLC, inflated labor costs, performed minimal work and submitted falsified timesheets. The Charlemagnes have pleaded not guilty and are presumed innocent.
The ruling bars prosecutors from using a June 10, 2020 proposal submitted by ISG, D&S Trucking and Mr. Charlemagne to support allegations that the defendants fraudulently concealed recent or ongoing work for VIHFA in June 2020 or made false certifications about financial conflicts of interest in three attachments to the proposal.
The dispute turns on whether the challenged material directly proves the crimes charged or concerns conduct occurring alongside and facilitating those crimes. Prosecutors argued that the evidence formed part of the alleged fraud itself, while the defense maintained that the government was trying to introduce earlier conduct outside the charges.
Kearney emphasized the dates in the second superseding indictment. Count I charges Mr. Charlemagne with fraud concerning programs receiving federal funds from approximately January 2021 through June 11, 2024, while Count II concerns alleged wire fraud arising from a false insurance certification on June 8, 2020.
Those dates are central to the ruling’s scope. The June 8 insurance allegation remains part of the case, and the judge left room for prosecutors to establish a connection between the payment records or statements and either charged offense. The order does not impose a blanket ban on evidence predating 2021 or dismiss any charges.
For the June 10 proposal, prosecutors argued that the document was the means through which Mr. Charlemagne carried out the alleged fraud, with subsequent misconduct flowing from its alleged misrepresentations, concealments and false certifications. The defense countered that the document could not directly prove an offense involving conduct the government had not charged.
Kearney agreed with the defense’s argument concerning Count I, noting that the proposal preceded the charged period by more than six months. “The Proposal is not intrinsic evidence of the charged offense and not contemporaneous with the charged offense,” he wrote.
Intrinsic evidence is material treated as part of the charged crime. Citing Third Circuit precedent, the judge explained that evidence qualifies when it directly proves the offense, or when uncharged acts occurred at the same time as the charged crime and helped facilitate it.
Prosecutors initially identified the challenged material in a notice under Federal Rule of Evidence 404(b), which governs evidence of other acts. That rule generally prohibits using other conduct merely to argue that a defendant has a bad character and acted accordingly. Prosecutors subsequently said they were offering the material only as intrinsic evidence, so Kearney did not decide the defense’s separate argument that the government’s notice was inadequate.
The government also did not identify an alternative permissible use of the proposal under Rule 404(b) if the judge found it was outside the charged conduct. Kearney rejected the government’s asserted basis for admitting it.
The payment records covered by the conditional exclusion include 15 payment packages and supporting documents dated before January 2021. They encompass invoices, check requests, vendor payments and emails requesting payment, involving warehouse-management services at Sunshine Mall and Bovoni or payments from sources other than Community Development Block Grants.
The broader group of vendor payments challenged by the defense runs from September 5, 2019 through April 14, 2021. Prosecutors argued that those records showed what Mr. Charlemagne allegedly concealed during the bidding process, but Kearney found they had not established why the pre-January 2021 payments were intrinsic to the charged offense.
The judge nevertheless said the government might establish that payments between January 2021 and April 14, 2021 directly related to Count I. Prosecutors could also attempt to show that payments shortly before January 2021 were sufficiently contemporaneous with the charged conduct under the governing precedent.
A third category involves recorded statements attributed to Mr. Charlemagne concerning allegedly concealed work managing the St. Thomas and St. Croix woodpile warehouses and his alleged control of those facilities. Kearney said the government provided no information about the nature or timing of the statements that would allow him to determine whether they qualified as intrinsic evidence.
Both the payment-record and statement exclusions are subject to further argument on October 29. Even if prosecutors establish the required connection to a charged offense, the court must also consider whether the evidence’s value in proving the case is substantially outweighed by the danger of unfair prejudice.
The October 6 decision addresses a different issue from the Charlemagnes’ previously reported efforts to dismiss the case over publicity surrounding HUD’s suspension of VIHFA. Those arguments concerned whether public statements and media coverage compromised the prospect of a fair trial; this order concerns the evidence prosecutors may present.
The District Court’s public calendar currently lists jury selection for November 2 and the jury trial for November 3 in St. Thomas. The October 29 conference will give prosecutors an opportunity to address the outstanding evidentiary questions before those proceedings.
