Stinn v. United States

Court of Appeals for the Second Circuit·Decided August 17, 2026·No. 25-293·Published

Opinion

25-293 Stinn v. United States of America

In the

United States Court of Appeals For the Second Circuit

AUGUST TERM 2025

ARGUED: MARCH 16, 2026 DECIDED: AUGUST 17, 2026

No. 25-293

BRADLEY J. STINN, Petitioner-Appellant,

v.

UNITED STATES OF AMERICA, Respondent-Appellee.

Appeal from the United States District Court for the Eastern District of New York

Before: WALKER, SULLIVAN, and BIANCO, Circuit Judges.

Bradley Stinn appeals from an order denying his petition for a writ of error coram nobis. In 2009, Stinn was convicted of securities fraud, mail fraud, and conspiracy to commit the same. At trial, the jury was permitted to rely on either the traditional fraud theory or the right-to-control theory of fraud liability. After the Supreme Court

invalidated the right-to-control theory in Ciminelli v. United States, 598 U.S. 306 (2023), Stinn filed a coram nobis petition in the Eastern District of New York to vacate his sentence. The district court (Chen, J.) denied the petition, holding that the right-to-control instruction given at trial was harmless error. On appeal, Stinn argues that his conviction is not supported by either the traditional fraud theory or the now-invalidated right-to-control theory, and that the district court erred by applying the wrong test for harmless error. We disagree. For the reasons explained below, we hold that the standard articulated in Kotteakos v. United States, 328 U.S. 750 (1946), governs review of harmless error in coram nobis petitions. Stinn failed to satisfy that test. Thus, we AFFIRM the judgment of the district court.

GIL WALTON (David W. Shapiro, on the brief), The Norton Law Firm PC, Oakland, CA, for Petitioner- Appellant

VICTOR ZAPANA (David C. James, on the brief), Assistant United States Attorneys, for Joseph Nocella, Jr., United States Attorney, Eastern District of New York, Brooklyn, NY, for Respondent-Appellee

JOHN M. WALKER, JR., Circuit Judge:

Bradley Stinn appeals from an order denying his petition for a writ of error coram nobis. In 2009, Stinn was convicted of securities fraud, mail fraud, and conspiracy to commit the same (18 U.S.C. §§ 1341, 1348, 1349). At trial, the district court instructed the jury that it could rely on either the traditional fraud theory or the right-to-control theory of fraud liability. The jury voted to convict on

all three counts, and Stinn served a sentence of 144 months of imprisonment and three years of supervised release.

After Stinn completed his sentence and his term of supervised release, the Supreme Court invalidated the right-to-control theory in Ciminelli v. United States, 598 U.S. 306 (2023). Stinn then filed a coram nobis petition to vacate his sentence. The district court (Chen, J.) denied the petition, holding that the right-to-control instruction given at trial was harmless error, and that the traditional fraud theory was a valid basis for Stinn’s conviction. On appeal, Stinn argues that his conviction is not supported by either the traditional fraud theory or the now-invalidated right-to-control theory. He also argues that the district court erred by applying the test for harmless error used to evaluate habeas petitions, Kotteakos v. United States, 328 U.S. 750 (1946), rather than the test used on direct review, Chapman v. California, 386 U.S. 18 (1967).

We disagree. For the reasons explained below, we hold that Kotteakos is the appropriate standard for evaluating harmless error in coram nobis petitions. Under that standard, the relevant inquiry is whether the error “had substantial and injurious effect or influence in determining the jury’s verdict.” Kotteakos, 328 U.S. at 776. Stinn failed to satisfy that test. Thus, we affirm the judgment of the district court.

BACKGROUND

From 1992 to 2003, Bradley Stinn served as the chief executive officer of Friedman’s Inc. (“Friedman’s”). Friedman’s was the thirdlargest specialty retailer of fine jewelry in the United States, operating over six hundred stores in twenty states.

Beginning in August 2003, the company’s fortune took a turn for the worse when it was sued in a civil lawsuit for purported accounting fraud. The following month, the Securities and Exchange

Commission and the Department of Justice launched investigations into the allegations made in the civil lawsuit. By December 2003, Stinn had resigned as CEO and from the company’s board of directors. Approximately two years later, the company filed for bankruptcy.

In 2007, Stinn was charged by superseding indictment in the Eastern District of New York on three counts of mail fraud, securities fraud, and conspiracy to commit the same. The indictment centered on Friedman’s credit-extension program, which allowed low- and middle-income customers to purchase jewelry on installment plans. Although the program was lucrative, comprising over half of the company’s revenues, these customers were at greater risk of defaulting on their payments. As alleged in the superseding indictment, Stinn conspired with Friedman’s executives to defraud investors by masking that heighted risk of default, through falsifying Friedman’s accounting data and misrepresenting the company’s financial condition in public reports.

At trial, the government presented evidence regarding Stinn’s financial motivations for the scheme, including his $352,000 bonus for 2002 and $300,000 salary increase for 2003, and argued that both “result[ed] [from] the lies the defendant told” regarding Friedman’s targeted earnings. App’x at 2061. The government presented testimony from Friedman’s former chief financial officer, Victor Suglia, who testified that Stinn would not have received his $352,000 bonus “[a]bsent [his] manipulation[s.]” Id. at 1203. Former director Robert Cruickshank also testified that Stinn received a $300,000 salary raise, a “much larger increase than anybody else” at the company,

because the compensation committee “thought that the company was doing very well[.]” Id. at 1366.

After the close of evidence, the district court (Gershon, J.)

issued the jury instructions relevant to this appeal. The jury was instructed that to convict, it must find that the alleged scheme to defraud “contemplated or intended some harm to property rights of another[,]” as defined under either of two theories. Special App’x at 3 (internal quotation marks omitted). Under the traditional theory of fraud liability, Stinn must have “planned to obtain or actually obtained money from Friedman’s by materially fraudulent representations[.]” Id. (internal quotation marks omitted). Under the right-to-control theory, Stinn must have “intended that other individuals would make investment decisions . . . based on materially fraudulent misrepresentations.” Id. (internal quotation marks omitted).

Following these instructions, the jury voted to convict Stinn on all counts. Because the jury returned a general verdict, there was no indication as to which of the two theories the jury relied on. The jury also returned a forfeiture verdict requiring Stinn to forfeit $1,019,000, including his $352,000 bonus received in 2002, his $300,000 raise in 2003, and other funds improperly obtained from expensed tax liabilities. The district court then sentenced Stinn to 144 months of imprisonment and three years of supervised release and ordered him to pay approximately $5.5 million in restitution and forfeiture.

During his incarceration, Stinn made direct and collateral attacks on his conviction, resulting in two decisions by our court. On direct appeal, we rejected Stinn’s argument that the district court erred in giving a conscious avoidance instruction and a purportedly coercive charge pursuant to Allen v. United States, 164 U.S. 492 (1896). United States v. Stinn (“Stinn I”), 379 F. App’x 19, 20-21 (2d Cir. 2010)

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