United States v. Silver

117 F. Supp. 3d 461, 2015 WL 4496295
District Court, S.D. New York·Decided July 24, 2015·No. No. 15-CR-93 (VEC)·Published·Cited by 3 cases

Opinion

MEMORANDUM OPINION & ORDER

VALERIE CAPRONI, District Judge.

In his third attempt to have the charges against him dismissed,1 Defendant Sheldon Silver argues that the Government has failed adequately to allege that he committed the crimes with which he is charged. Specifically, Silver contends that the Superseding Indictment is deficient because (1) Silver’s alleged conduct amounts, at most, to coercion, rather than to Hobbs Act extortion; (2) the fraudulent schemes in which he allegedly engaged may have constituted self-dealing or ethical conflicts but did not include “bribes or kickbacks” as is required for honest services fraud, see Skilling v. United States, 561 U.S. 358, 130 S.Ct. 2896, 177 L.Ed.2d 619 (2010); (3) the Government has not specifically alleged the telephone calls and emails on which the mail and wire fraud charges are based; and (4) the federal money laundering statute under which Silver is charged is unconstitutionally vague. None of Silver’s arguments is. persuasive. Defendant’s Motion is DENIED.

[464] BACKGROUND

On April 23, 2015, the Government filed a Superseding Indictment (“SI”) charging Silver.with two counts of honest services mail fraud, 18 U.S.C. §§ 1341, 1346; two counts of honest services wire fraud, 18 U.S.C. §§ 1343,1346; two counts of extortion under color of official right, 18 U.S.C. § 1951; and money laundering, 18 U.S.C. § 1957. SI ¶¶ 33-45. The Superseding Indictment alleges three schemes that are relevant to this Motion: the “asbestos scheme,” the “real estate scheme,” and the “money laundering scheme.”

In the asbestos scheme, Silver (in his capacity as Speaker of the New York State Assembly) allegedly disbursed state funds to a research center with which a physician who specializes in the treatment of meso-thelioma (“Doctor-1”) was affiliated. Id. ¶¶ 16-18, 23.2 In exchange, Doctor-1 transmitted his patients’ information (with their consent) to Silver, who passed the information along to Weitz & Luxenberg, P.C., a law firm with which Silver was affiliated. Id. ¶¶ 8(b), 20-23. Many of Doctor-l’s patients retained Weitz & Lux-enberg, and the firm paid Silver more than $3 million in referral fees. Id. ¶ 24.

In the real estate scheme, Silver allegedly used his position as Speaker of the New York State Assembly to steer two real estate developers (“the Developers”) towards a particular law firm (the “Real Estate Law Firm”) in which Silver’s former counsel is a partner. Id. ¶¶ 10-13. In exchange, Silver regularly met with lobbyists and representatives from the Developers and “supported legislative proposals favorable to [the Developers].” Id. ¶ 13(d). The Developers had not previously engaged the Real Estate Law Firm, but both engaged the firm for their tax certiorari business at Silver’s urging. Id. ¶ 13(a).3 The Real Estate Law Firm, in turn, paid Silver approximately $700,000, representing a percentage of the fees it obtained from the Developers. Id. ¶ 14.

Finally, in the money laundering scheme, the Superseding Indictment charges that Silver used his relationship with an investor (“Investor-1”) “to distribute his crime proceeds across numerous high-yield investment vehicles not available to the general public,” typically featuring high returns with minimal risk. Id. ¶¶ 29-30. Beginning around 2006, Silver transferred approximately $642,000 from his bank account into one such investment (“Investment Vehicle-1”); these funds had grown to over $1.4 million by January 2015. Id. ¶ 32. In 2011, when it became apparent that a change in law would require Silver to disclose his assets to the public, Silver allegedly transferred more than $340,000 in Investment Vehicle-1 from his name into the name of a family member to avoid public disclosure of the full amount of his investment. Id.

DISCUSSION

A defendant seeking to challenge the sufficiency of an indictment on a motion to dismiss faces a high hurdle. “Pursuant to Federal Rule of Criminal Procedure 7, ‘the indictment or information must be a plain, concise, and definite written statement of the essential facts constituting the offense charged.’ ” United States v. Vilar, 729 F.3d 62, 80 (2d Cir.2013) (quoting Fed.R.Crim.P. 7(c)(1) (alterations omitted)). “An indictment is sufficient if it ‘first, contains the elements of [465] the offense charged and fairly informs a defendant of the charge against which he must defend, and, second, enables him to plead an acquittal or conviction in bar of future prosecutions for the same offense.’ ” United States v. Stringer, 730 F.3d 120, 124 (2d Cir.2013) (quoting Hamling v. United States, 418 U.S. 87, 117, 94 S.Ct. 2887, 41 L.Ed.2d 590 (1974)); see also United States v. Resendiz-Ponce, 549 U.S. 102, 108, 127 S.Ct. 782, 166 L.Ed.2d 591 (2007). “ ‘Unless the government has made what can fairly be described as a full proffer of the evidence it intends to present at trial[,] the sufficiency of the evidence is not appropriately addressed on a pretrial motion to dismiss an indictment.’ ” United States v. Perez, 575 F.3d 164, 166-67 (2d Cir.2009) (quoting United States v. Alfonso, 143 F.3d 772, 776-77 (2d Cir.1998) (alteration omitted)).

I. The Superseding Indictment Alleges that Silver Committed Hobbs Act Extortion

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United States v. Silver, 117 F. Supp. 3d 461, 2015 WL 4496295 (S.D.N.Y. 2015).

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