⚖ Oral Arguments, with Context

Denny Bhakta appeals fraud convictions and a two-hundred-thirty-five-month prison sentence. His Fusion businesses pitched investments in discounted hotel rooms to be resold to corporate customers. Prosecutors and the Securities and Exchange Commission said the supposed hotel business masked diversions to gambling, personal expenses and payments to earlier investors. The criminal case also involved pandemic business loans through the Paycheck Protection Program, or PPP. Prosecutors said false payroll and tax records supported those applications. A jury convicted Bhakta of securities fraud, bank fraud and money laundering. The appeal asks whether the jury should have seen the underlying electronic files, not just readable copies of payroll documents. Metadata is information about a file, such as when it was created or edited. Bhakta disputes authorship, not whether the copies accurately show the documents received by the banks. The best-evidence rule generally requires an original to prove a document's contents. But an accurate readable output of electronic information can itself count as an original. The dispute is whether missing metadata changes that analysis here. Another issue concerns Kabbage, a PPP processor with a separate federal fraud settlement. That settlement does not establish who created Bhakta's documents. Rule four-oh-three permits excluding relevant evidence when dangers such as confusing the issues substantially outweigh its value. Sentencing questions concern the loss estimate, repayments and a two-level increase for alleged perjury. Perjury requires willfully false testimony on a material matter, meaning one that could affect the decision; mere disbelief is not enough. The judges also discuss plain-error review, which allows some unpreserved errors to be considered if they affect substantial rights. David Schlesinger will challenge the evidence rulings and sentence for Bhakta. The government will defend them.

United States v. Denny Bhakta (No. 25-1344) — U.S. Court of Appeals for the Ninth Circuit, argued October 22, 2026.