United States v. Rittweger

274 F. App'x 78
Court of Appeals for the Second Circuit·Decided April 23, 2008·No. Nos. 05-3600-cr(L), 05-3766-cr(CON), 05-3769-cr(CON)·Published·Cited by 3 cases

Opinion

SUMMARY ORDER

Defendants-appellants Thomas Michael Rittweger, Victor M. Wexler, and Douglas C. Brandon appeal from judgments of conviction, following a jury trial, entered on July 1, 2005, July 1, 2005, and June 24, 2005, respectively, in the United States District Court for the Southern District of New York (Koeltl, J.). Rittweger was sentenced principally to a term of 135 months’ imprisonment, Brandon was sentenced principally to a term of 97 months’ imprisonment, and Wexler was sentenced principally to a term of 24 months’ imprisonment, each term of imprisonment to be followed by a term of three years’ supervised release. We assume the parties’ familiarity with the underlying facts and the procedural history of this case.1

Sufficiency of the Evidence Challenges

Brandon argues that the evidence produced at trial was insufficient to prove that he knowingly participated in the charged conspiracy. He relies on the [81]*81statement of Virginia Allen, an alleged co-conspirator who died before she was able to testify at trial, made to the FBI, that Richard Blech, principal actor in both frauds, instructed her not to tell Brandon that he was not the sole signatory on Credit Bancorp, Ltd.’s (“CBL”) insured accounts. In spite of this statement, there was evidence, as discussed by the district court in United States v. Rittweger, No. 02-cr122, 2003 WL 22290228, at *2-5 (S.D. N.Y. Oct. 6, 2008), from which the jury could have otherwise found that Brandon knew he was not a signatory on the company’s bank or brokerage accounts, that he had no control over the customer securities deposited in those accounts, and that despite this knowledge, he continued to sign agreements with customers misrepresenting the contrary. For example, early in his tenure as “insured trustee,” Brandon was advised by Blech that he needed to go to Europe to be added as a signatory to the CBL accounts, which Brandon never did. Nevertheless, Brandon represented to Dr. Joffe, who entrusted more than $8 million of securities to CBL, that Dr. Joffe’s securities were held by Brandon in an insured account for which Brandon was the sole signatory. Furthermore, there was evidence suggesting that Brandon was aware that he had no control over the CBL account, namely that he could not obtain the victims’ assets when requested to do so. Because we must draw all inferences in favor of the government, United States v. Stanley, 928 F.2d 575, 576 (2d Cir.1991), and need not exclude “every possible hypothesis of innocence,” United States v. Soto, 716 F.2d 989, 993 (2d Cir.1983), this evidence would allow a rational juror to find Brandon guilty of the fraud and conspiracy.2

As for Wexler’s insufficiency claim, there is direct evidence on tape recordings made by the FBI that suggests he knew that DeHaven was making false misrepresentations to potential investors, and that both DeHaven and Wexler were being paid for acting as references and recruiting investors for CBL. Combined with Wexler’s false denial of any arrangement with DeHaven concerning CBL when interviewed by the FBI on June 13, 2001, a jury could reasonably find that Wexler knowingly conspired to commit and committed wire fraud and commercial bribery in violation of the Travel Act. See Jackson v. Virginia, 443 U.S. 307, 319, 99 S.Ct. 2781, 61 L.Ed.2d 560 (1979) (noting a conviction challenged on sufficiency grounds will be affirmed if a reviewing court finds that “any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt”).

The Crawford Error

At trial, the government was allowed to introduce portions of the plea allocution given by Allen for the purpose of establishing the existence of the conspiracy charged in Counts One through Eight (the “First Scheme”), and what Allen did to carry out the conspiracy. In light of the intervening Supreme Court decision in Crawford v. Washington, 541 U.S. 36, 124 S.Ct. 1354, 158 L.Ed.2d 177 (2004), the government concedes that the admission of Allen’s guilty plea allocution was error. Nevertheless, we find this error to be harmless in light of the overwhelming evidence that the conspiracy charged in Count One existed, including Blech’s testimony and Allen’s grand jury testimony, the latter of which was offered into evidence by Rittweger and Brandon. [82]*82See United States v. Reifler, 446 F.3d 65, 87 (2d Cir.2006) (holding that the admission of a co-conspirator’s plea allocution was harmless). Additionally, the limiting instructions given by Judge Koeltl were sufficient to render any Crawford error harmless beyond a reasonable doubt. See United States v. Downing, 297 F.3d 52, 59 (2d Cir.2002) (“Absent evidence to the contrary, we must presume that juries understand and abide by a district court’s limiting instructions.”).

Exclusion of Wexler’s Statements to DeHaven

We reject Wexler’s contention that the district court abused its discretion by excluding portions of a June 30, 2001 taped conversation between Wexler and DeHaven. Judge Koeltl acted well within his discretion by excluding from evidence Wexler’s statements to DeHaven that he should “tell the truth” and “listen to [his] attorney,” as these statements were made long after the conspiracy had ended and thus were marginally, if at all, relevant. See United States v. Khalil, 214 F.3d 111, 122 (2d Cir.2000) (district courts enjoy broad discretion in deciding evidentiary issues at trial).

Rittweger’s enhanced sentence

Rittweger challenges his sentence enhancement under Sentencing Guideline Section 3B1.1, on the ground that the evidence was insufficient to establish either that the criminal activity was “otherwise extensive,” or that he acted as a leader or supervisor. Because there were at least four knowing participants in the First Scheme — Blech, Rittweger, Allen, Brandon — and somewhere between 30 and 75 unknowing participants, namely the network of brokers reporting to Rittweger, these facts support the district court’s determination that the criminal activity was

“otherwise extensive.” See United States v. Carrozzella, 105 F.3d 796, 803-04 (2d Cir.1997), abrogated in part on other grounds, United States v. Kennedy, 233 F.3d 157, 160-61 (2d Cir.2000). As to whether Rittweger was an organizer or leader, Rittweger objects to the district court’s reliance upon his relationship with DeHaven and Wexler, who were criminal participants in the conspiracy charged in Counts Nine through Thirteen (the “Second Scheme”), which was not specifically found to be “otherwise extensive” by the district court.

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United States v. Rittweger, 274 F. App'x 78 (2d Cir. 2008).

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