Securities and Exchange Commission v. Brightpoint, Inc. , 353 F. App'x 636 ( 2009 )

07-4199-cv
Securities and Exchange Commission v. Brightpoint, Inc.
1 UNITED STATES COURT OF APPEALS
2 FOR THE SECOND CIRCUIT
3
4 SUMMARY ORDER
5
6 RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO SUMMARY ORDERS
7 FILED AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY THIS COURT’S LOCAL RULE 32.1
8 AND FEDERAL RULE OF APPELLATE PROCEDURE 32.1. IN A BRIEF OR OTHER PAPER IN WHICH A
9 LITIGANT CITES A SUMMARY ORDER, IN EACH PARAGRAPH IN WHICH A CITATION APPEARS, AT LEAST
10 ONE CITATION MUST EITHER BE TO THE FEDERAL APPENDIX OR BE ACCOMPANIED BY THE NOTATION:
11 “(SUMMARY ORDER).” A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF THAT SUMMARY ORDER
12 TOGETHER WITH THE PAPER IN WHICH THE SUMMARY ORDER IS CITED ON ANY PARTY NOT REPRESENTED
13 BY COUNSEL UNLESS THE SUMMARY ORDER IS AVAILABLE IN AN ELECTRONIC DATABASE WHICH IS
14 PUBLICLY ACCESSIBLE WITHOUT PAYMENT OF FEE (SUCH AS THE DATABASE AVAILABLE AT
15 HTTP://WWW.CA2.USCOURTS.GOV/). IF NO COPY IS SERVED BY REASON OF THE AVAILABILITY OF THE
16 ORDER ON SUCH A DATABASE, THE CITATION MUST INCLUDE REFERENCE TO THAT DATABASE AND THE
17 DOCKET NUMBER OF THE CASE IN WHICH THE ORDER WAS ENTERED.
18
19 At a stated term of the United States Court of Appeals for
20 the Second Circuit, held at the Daniel Patrick Moynihan United
21 States Courthouse, 500 Pearl Street, in the City of New York, on
22 the 23rd day of November, two thousand nine.
23
24 PRESENT:
25 PIERRE N. LEVAL,
26 BARRINGTON D. PARKER,
27 DEBRA ANN LIVINGSTON,
28 Circuit Judges.
29 __________________________________________
30 Securities and Exchange Commission,
31
32 Plaintiff-Appellee,
33
34 v. 07-4199-cv
35
36 Timothy Harcharik,
37
38 Defendant-Appellant,
39
40 Brightpoint, Inc., American International
41 Group, John Delaney, Phillip Bounsall,
42
43 Defendants,
44
45 United States Attorney’s Office, Southern
46 District of Indiana,
47
48 Intervenor.
49 __________________________________________
50
1 FOR APPELLANT: Timothy C. Harcharik, pro se, Fishers, Indiana.
2
3 FOR APPELLEES: Brian G. Cartwright, General Counsel; Mark
4 Pennington, Assistant General Counsel; Dominick V.
5 Freda, Senior Counsel, Securities and Exchange
6 Commission, Washington, D.C.
7 Appeal from a judgment of the United States District Court
8 for the Southern District of New York (Baer, J.).
9 UPON DUE CONSIDERATION IT IS HEREBY ORDERED, ADJUDGED, AND
10 DECREED that the judgment of the district court be AFFIRMED.
11 Appellant Timothy C. Harcharik, pro se, appeals from a
12 judgment of the district court, entered after a jury trial, in a
13 civil enforcement action brought by the Securities and Exchange
14 Commission (“SEC”). The jury found that Harcharik aided and
15 abetted violations of Section 10(b) of the Securities Exchange
16 Act of 1934 (“Exchange Act”), 15 U.S.C. § 78j(b), and Rule 10b-5
17 promulgated thereunder, 17 C.F.R. § 240.10b-5, and aided and
18 abetted violations of Section 13(b)(5) of the Exchange Act, 15
19 U.S.C. § 78m(b)(5), and Rule 13b2-1 promulgated thereunder, 17
20 C.F.R. § 240.13b2-1. The district court entered final judgment
21 against Harcharik, enjoined him from further violations of the
22 Exchange Act, and ordered him to pay a civil penalty of $50,000.
23 On appeal, Harcharik principally argues that: (1) the jury
24 verdict was incorrect, which we construe as a challenge to the
25 sufficiency of the evidence; (2) the trial court erred in its
26 jury instructions on the aiding and abetting charges, in failing
27 to provide an instruction regarding the SEC’s inadvertent
2
1 destruction of certain documents, in limiting the investigatory
2 testimony that Harcharik sought to read into evidence, and in
3 prohibiting his redirect examination; and (3) the monetary
4 penalty was excessive and punitive.
5 I. Sufficiency of the Evidence
6 Harcharik failed to move for judgment as a matter of law in
7 the district court and, accordingly, he is not entitled to
8 challenge the sufficiency of the evidence on appeal. Rothstein
9 v. Carriere, 373 F.3d 275, 291 (2d Cir. 2004); see also Fed. R.
10 Civ. P. 50. While we may excuse the failure to comply with this
11 requirement and review the claim to prevent manifest injustice,
12 see Rothstein, 373 F.3d at 291, we decline to do so here, where
13 there is ample evidence to support the verdict.
14 II. Jury Instructions and Evidentiary Issues
15 We review challenges to the district court’s jury
16 instructions de novo. Hudson v. New York City, 271 F.3d 62, 67
17 (2d Cir. 2001). Harcharik argues that the district court erred
18 in not charging the jury that the scienter requirement for the
19 aiding and abetting charges includes a showing of “extreme
20 recklessness”; however, the district court properly instructed
21 the jury that it must find that Harcharik knowingly provided
22 substantial assistance to a primary violator of the Exchange Act,
23 see 15 U.S.C. § 78t(e), which is in any event a more stringent
24 standard than extreme recklessness.
3
1 Harcharik also argues that the district court gave an
2 improper jury instruction on the primary § 10(b) violation.
3 However, since Harcharik ultimately prevailed on the primary
4 violation claim, any error here is harmless.
5 Insofar as Harcharik argues that the district court should
6 have given a jury instruction on the SEC’s destruction of
7 documents, the district court instructed the parties to reach a
8 stipulation on this issue and, after they apparently failed to do
9 so, Harcharik never again raised the issue before the district
10 court, thereby failing to preserve a challenge to the omission of
11 a jury instruction on this issue. Fed. R. Civ. P. 51(c) (“A
12 party who objects to. . . the failure to give an instruction must
13 do so on the record, stating distinctly the matter objected to
14 and the grounds for the objection.”); Shade v. Housing Authority,
15 251 F.3d 307, 312 (2d Cir. 2001). Accordingly, we review his
16 claim for fundamental error, and find none. Shade, 251 F.3d at17 312-13.
18 With respect to Harcharik’s claim that the district court
19 improperly limited the investigatory testimony that he wished to
20 read into evidence, a review of the record indicates that
21 Harcharik voluntarily agreed to limit this material and made no
22 objection concerning the limits imposed by the district court.
23 Accordingly, he has failed to preserve this claim for appeal, and
24 we find no plain error in the district court’s actions. See
4
1 United States v. Yu-Leung, 51 F.3d 1116, 1120-21 (2d Cir. 1995).
2 With respect to Harcharik’s claim that the district court
3 improperly denied him the opportunity to conduct a redirect
4 examination, the record does not indicate that Harcharik ever
5 requested the opportunity to perform such an examination or that
6 the district court denied any such request. He therefore also
7 failed to preserve this claim for appeal, and we find no plain
8 error here. Id.9 III. Civil Monetary Penalty
10 Harcharik argues that the $50,000 fine imposed by the
11 district court was excessive, given his degree of involvement in
12 the violations at issue and his inability to pay the fine.
13 However, the district court did not abuse its discretion in
14 ordering Harcharik to pay this fine, which was well within the
15 permissible range prescribed by Section 21(d)(3) of the Exchange
16 Act. 15 U.S.C. § 78u(d)(3).
17 We have reviewed Harcharik’s remaining arguments and have
18 determined that they lack merit.
19 For the foregoing reasons, the judgment of the district
20 court is hereby AFFIRMED.
21
22 FOR THE COURT:
23 Catherine O’Hagan Wolfe, Clerk
24 By:__________________________
5