United States v. Ohle , 441 F. App'x 798 ( 2011 )

11-0393-cr(L)
United States v. Ohle
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
SUMMARY ORDER
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A
SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY
FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN
CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE
EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION
“SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY
PARTY NOT REPRESENTED BY COUNSEL.
At a stated term of the United States Court of Appeals for the Second Circuit, held at
the Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, in the City of New
York, on the 20th day of October, two thousand eleven.
PRESENT: ROBERT D. SACK,
REENA RAGGI,
Circuit Judges,
RICHARD K. EATON,
Judge.*
----------------------------------------------------------------------
UNITED STATES OF AMERICA,
Appellee,
v. Nos. 11-0393-cr(L),
11-0395-cr(CON)
JOHN B. OHLE, III, WILLIAM E. BRADLEY,
Defendants-Appellants.
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APPEARING FOR APPELLANTS: STUART E. ABRAMS, Frankel & Abrams, New
York, New York, for Defendant-Appellant John
B. Ohle, III.
*
Judge Richard K. Eaton of the United States Court of International Trade, sitting by
designation.
1
EDWARD S. ZAS, Federal Defenders of New
York, Inc., Appeals Bureau, New York, New
York, for Defendant-Appellant William E.
Bradley.
APPEARING FOR APPELLEE: STANLEY J. OKULA, JR., Assistant United
States Attorney (Katherine Polk Failla, Assistant
United States Attorney, Nanette L. Davis, Special
Assistant United States Attorney, on the brief), on
behalf of Preet Bharara, United States Attorney
for the Southern District of New York, New
York, New York.
Appeal from the United States District Court for the Southern District of New York
(Jed S. Rakoff, Judge).
UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND
DECREED that the judgments entered on January 28, 2011, are AFFIRMED.
John B. Ohle, III and William E. Bradley appeal from convictions entered after a jury
trial at which both men were found guilty of conspiracy to defraud an agency of the United
States, specifically, the Internal Revenue Service, see 18 U.S.C. §§ 371, 1341, 1343; 26
U.S.C. § 7201, and at which Ohle was also found guilty of two counts of attempted tax
evasion, see 26 U.S.C. § 7201. Defendants challenge the sufficiency of the evidence
supporting their convictions and related forfeiture orders, as well as the district court’s denial
of their new trial motion based on a purported denial of due process as recognized in Brady
v. Maryland, 373 U.S. 83, 87 (1985). Bradley further challenges his 12-month prison
sentence as procedurally unreasonable. We assume the parties’ familiarity with the facts and
record of prior proceedings, which we reference only as necessary to explain our decision
to affirm.
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1. Sufficiency Challenges
Defendants bear a heavy burden in raising sufficiency challenges to their convictions
because although our standard of review is de novo, we must view the trial evidence in the
light most favorable to the verdict, assuming that the jury resolved all questions of witness
credibility and competing inferences in favor of the prosecution. See United States v. Abu-
Jihaad, 630 F.3d 102, 134-35 (2d Cir. 2010), cert. denied, 131 S. Ct. 3062 (2011). Under this
“exceedingly deferential” standard of review, United States v. Hassan, 578 F.3d 108, 126 (2d
Cir. 2008), defendants can secure relief only by showing that no rational trier of fact could
have found the essential elements of the crimes beyond a reasonable doubt, see Jackson v.
Virginia, 443 U.S. 307, 319 (1979); accord United States v. Abu-Jihaad, 630 F.3d at 135.
a. Conspiracy
Defendants contend that the evidence did not permit a reasonable jury to find that
schemes to defraud one of Ohle’s trust clients, Ecetra Ames, and his employer, Bank One,
were part of the charged single overarching conspiracy to defraud the United States. We
disagree. The question of whether evidence shows a single conspiracy or multiple
independent conspiracies “is a question of fact for a properly instructed jury.” United States
v. Burger, 224 F.3d 107, 114 (2d Cir. 2000); accord United States v. Chavez, 549 F.3d 119,
125 (2d Cir. 2008). Defendants do not contend that the jury was improperly instructed on
this point. Having reviewed the record, we conclude that a rational jury could have found
that the complex, multi-phase process by which conspirators stole money from the Ames
trust, then stole fees from Bank One that would not otherwise have gone to them, and finally
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avoided paying federal taxes on the monies so obtained constituted a single interdependent
scheme to defraud the United States. See United States v. McDermott, 245 F.3d 133, 136-37
(2d Cir. 2001); United States v. Sureff, 15 F.3d 225, 230-31 (2d Cir. 1994).1
Defendants further argue that the evidence was insufficient to permit a reasonable jury
to find that the charged conspiracy affected a financial institution, as required to afford the
government the benefit of the ten-year statute of limitations specified in 18 U.S.C. § 3293(2).
In fact, evidence of referral fees paid to John Manella, Bradley, and Jay Gordon in
connection with “HOMER” tax shelter transactions permitted a reasonable jury to find this
effect requirement satisfied in the manner charged by the district court, i.e., by obtaining
monies that Bank One would otherwise not have paid, or at the very least, not to these
persons. Cf. United States v. Aguilar, 585 F.3d 652, 656 (2d Cir. 2009).
b. Tax Evasion
Ohle next argues that the trial evidence was insufficient to permit any reasonable jury
to find him guilty of attempted tax evasion. He submits that he did not have fair notice that
his conduct in entering into the complex “1256” tax shelter transaction at issue, see 26 U.S.C.
1
Insofar as defendants submit that their conspiracy convictions are repugnant to law
because Bank One was itself guilty of marketing unlawful tax shelters, the argument fails
because the scheme to defraud Bank One, whatever its culpability, was only part of the
charged conspiracy to avoid paying federal taxes to the United States on criminally obtained
monies. See James v. United States, 366 U.S. 213, 221 (1961) (refusing to “perpetuate the
injustice of relieving embezzlers of the duty of paying income taxes on the money they
enrich themselves with while honest people pay their taxes on every conceivable type of
income”).
4
1256, could constitute a willful attempt to evade federal income taxes, see 26 U.S.C. § 7201.
Neither argument is persuasive.
Trial evidence showed that Ohle, a tax lawyer and certified accountant, stated to
various “1256” shelter participants that the vehicle was structured to limit their actual risk
of loss to the amount invested. The jury heard further evidence indicating Ohle’s knowledge
that the investment would generate paper losses in far larger—i.e., multimillion
dollar—amounts. It also heard that Ohle nevertheless made false statements to another tax
lawyer regarding the nature of the shelter transaction to obtain an opinion letter indicating
that his own investment objectives and his claimed tax deduction from these paper losses
were lawful. Where the evidence so convincingly demonstrates an intent to defraud the
United States of taxes owed, we need not delineate the precise boundaries of the “at risk” or
“primarily for profit” theories of evasion pursued by the government, see 26 U.S.C.
§§ 465(b)(4), 165(c)(2), in order to reject Ohle’s fair notice argument on the merits, see
United States v. Tannenbaum, 934 F.2d 8, 11 (2d Cir. 1983) (rejecting fair warning challenge
where ample trial evidence demonstrated that defendant knew he was committing unlawful
act).
c. Venue
Defendants argue that the trial evidence was insufficient to permit a preponderance
finding that the charged crimes were properly venued in the Southern District of New York.
See United States v. Rommy, 506 F.3d 108, 119 (2d Cir. 2007) (discussing preponderance
standard for venue). Venue is proper where the defendant intentionally or knowingly caused
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an act in furtherance of the charged offense to occur, or where the defendant could
reasonably foresee that such an act would occur as a result of his own conduct. See United
States v. Svoboda, 347 F.3d 471, 483 (2d Cir. 2003).
i. Conspiracy
For a conspiracy charge, venue lies in any district in which an overt act in furtherance
of the conspiracy was committed by any conspirator. See id. at 482-83. This can include
evidence that a conspirator traveled into the district, see United States v. Nathan, 476 F.2d
456, 461-62 (2d Cir. 1973), or directed communications into the district, see United States
v. Rommy, 506 F.3d at 120, in furtherance of the charged scheme.
Defendants argue that the only relevant acts proved to have occurred in the Southern
District of New York predated the charged conspiracy. The argument is grounded in
defendants’ contention that acts relating to the Ames trust embezzlement, many of which
occurred in the Southern District of New York, could not be viewed as part of the later
referral-fee scheme. Having already concluded that a reasonable jury could find all these
activities to be part of the single charged conspiracy against the United States, we reject
defendants’ argument that overt acts in the Southern District of New York pertaining to the
Ames trust do not suffice to satisfy venue on the conspiracy count.
ii. Tax Evasion
A tax evasion charge is properly venued wherever a defendant’s attempt to evade
taxes was begun, continued, or completed. See United States v. Drachenberg, 623 F.3d 122,
125 (2d Cir. 2010); cf. Spies v. United States, 317 U.S. 492, 499 (1943) (holding that “any
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conduct, the likely effect of which would be to mislead or to conceal” can be affirmative act
of tax evasion).
As to Count 2, a reasonable jury could find venue in the Southern District of New
York based on wire transfers that Ohle directed others to send from the United States to
Bermuda and back because they passed through New York correspondent banks.2 The
evidence showed that (1) on November 19, 2001, Ohle directed Charles Schwab to wire
transfer $7 million from Ames trust accounts in San Francisco to Carpe Diem accounts in
Bermuda; (2) on November 27, 2001, Ohle directed Schwab to transfer an additional
$347,834.04 from the San Francisco accounts to the Carpe Diem Bermuda accounts; (3) on
December 3, 2001, Ohle directed Carpe Diem to transfer $300,000 back to United States
accounts; and (4) on December 7, 2001, Ohle directed Carpe Diem to transfer the full
$347,834.04 back to United States accounts. A reasonable jury could find that as a
sophisticated lawyer and tax accountant, Ohle would have foreseen that these international
wire transfers would necessarily pass through New York correspondent banks. See Citibank,
N.A. v. Wells Fargo Asia Ltd., 495 U.S. 660, 663 (1990) (“To complete [international]
transactions, most banks that participate in the interbank trading market utilize correspondent
banks in New York City, with whom they maintain, directly or indirectly, accounts
denominated in United States dollars.”).
2
In light of Ohle’s sophistication, the fact that he sent multiple transfers through New
York correspondent banks, and the independent record evidence supporting the reasonable
conclusion that the transfers served a tax evasion purpose, we find it is unnecessary to
express a view regarding whether a showing of only a single such transfer, without more,
could establish venue on a tax evasion charge in the Southern District of New York.
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Further, while the most obvious purpose of these transfers was to swindle the Ames
trust undetected, the following evidence supports a reasonable preponderance that all four
transfers also served a tax evasion purpose. See Spies v. United States, 317 U.S. at 499.
First, regarding the $7 million and $300,000 transfers, Edward Doherty at Carpe Diem
testified that Ohle told him that the Ames trust planned to make a single payment to Carpe
Diem in Bermuda that would include Ohle’s $300,000 “commission,” and that Carpe Diem
should then wire Ohle’s “commission” back to the United States. See Trial Tr. at 1009. An
IRS agent testified that Carpe Diem wired the $300,000 back not to Ohle but, rather, to an
“Invested Interest” account held by one of Ohle’s associates, Jonathan Freedman. See id. at
1962-63. The IRS agent further testified that Freedman then transferred $250,000 of the
$300,000 total to Brown to fund Brown’s role in the fraudulent referral fee scheme, and only
sent the remaining $50,000 on to Ohle personally. See id. From the totality of this evidence,
a jury could reach a preponderance finding that Ohle concocted this first sequence of
international wire transfers not just to steal and hide his theft from the Ames trust, but also
to hide from tax authorities $250,000 of the $300,000 total income that he thereby received.
Second, regarding the two $347,834 transfers, Doherty testified that the first of these
transfers was characterized as an “overpayment” on the Ames trust investment. See Trial Tr.
at 1010-11. After Carpe Diem received the “overpayment,” Ohle told Carpe Diem that the
Ames account in San Francisco had been closed, and that the “overpayment” should thus be
returned to a different trust account, see id. at 1011-12, an account that the IRS agent
identified as the same Freedman account to which Ohle’s $300,000 “commission” had been
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wired. See id. at 1964. The IRS agent further testified that Freedman transferred $250,000
of the $347,834 total to Brown, and only the remaining $97,834 to Ohle personally. See id.
at 1964-65. Again, a reasonable jury could infer from the totality of the circumstances that
Ohle devised the second sequence of wire transfers to hide $250,000 of $347,834 in
embezzled income from tax authorities.
Ohle’s venue challenge to Count 3 merits little discussion. Trial evidence showed that
Ohle directed misleading communications to a lawyer in the Southern District of New York
in order to obtain an opinion letter regarding the “1256” shelter that would facilitate his
evasion of federal taxes. A jury reasonably could have easily concluded that this conduct
was intended to mislead or conceal information about Ohle’s tax liability and, thus, that the
attempted tax evasion charge in Count 3 was also properly venued in the Southern District
of New York. See United States v. Gross, 276 F.2d 816, 820 (1960).
2. Bradley’s Sentencing Challenge
Bradley argues that his sentence is infected by procedural error, specifically, a
miscalculation of his Sentencing Guidelines range by (1) the application of a two-level
enhancement for abuse of trust, see U.S.S.G. § 3B1.3; (2) the refusal to apply a two-level
minor-participant adjustment, see id. § 3B1.2(b); and (3) a miscalculation of the loss
resulting from his offenses, see id. § 2B1.1(b)(1). We review these sentencing challenges
for reasonableness, a standard akin to abuse of discretion, see United States v. Cavera, 550
F.3d 180, 187 (2d Cir. 2008) (en banc), and we conclude that each challenged Guidelines
calculation is supported by a preponderance of the evidence. See United States v. Garcia,
9
413 F.3d 201, 220 n.15 (2d Cir. 2005). Even if we were to conclude otherwise, however, any
error would have been harmless because the sentencing record unambiguously indicates that
the district court would have imposed the same below-guidelines sentence of 12 months’
imprisonment regardless of the Guidelines. See United States v. Jass, 569 F.3d 47, 68 (2d
Cir. 2009); accord United States v. Feldman, 647 F.3d 450, 460 (2d Cir. 2011).
3. Forfeiture Challenges
We review defendants’ challenges to the district court’s forfeiture orders for abuse of
discretion. See United States v. Gaskin, 364 F.3d 438, 461-62 (2d Cir. 2004).
a. Bradley’s Forfeiture Challenge
Bradley’s challenge to the order that he forfeit $255,000 appears to rest on the
mistaken premise that he can only be required to forfeit fraud proceeds that he personally
kept. To the contrary, 18 U.S.C. § 981(a)(1)(C) authorizes forfeiture of “[a]ny property . . .
which constitutes or is derived from proceeds traceable to” the offense, id., whether kept by
the defendant or shared with others, see United States v. Uddin, 551 F.3d 176, 181 (2d Cir.
2009). We identify no clear error in the district court’s factual finding that Bradley obtained
$255,000 in proceeds from Bank One traceable to the charged conspiracy, and that any
payments Bradley made from these proceeds to Manella were not for services Manella
rendered to Bank One. Accordingly, we reject Bradley’s forfeiture challenge on the merits.
b. Ohle’s Forfeiture Challenge
Ohle argues that the district court erred in ordering him to forfeit $2,954,344. As with
Bradley, we identify no clear error in the district court’s factual finding that Ohle received
10
$2,954,344 constituting, or derived from, proceeds traceable to the charged conspiracy. See
18 U.S.C. § 981(a)(1)(C). Specifically, we cannot say that the district court clearly erred in
finding that $697,934 in funds embezzled from Ames constituted proceeds traceable to the
conspiracy, and that, in light of the fact that these embezzled funds were used to fund Ken
Brown’s role in the conspiracy, the $1 million Brown later paid to Ohle was “derived from”
those earlier proceeds. Id.
4. New Trial
Finally, Ohle and Bradley assert that the government’s failure to make disclosures
required by Brady v. Maryland, 373 U.S. 83, compelled the district court to grant them a new
trial. See Fed. R. Crim. P. 33. Here again, our standard of review is abuse of discretion. See
United States v. Brunshtein, 344 F.3d 91, 101 (2d Cir. 2003). Having reviewed the district
court’s thoughtful and meticulous opinion denying defendants’ Rule 33 motions, see United
States v. Ohle, No. 3:08cr1109 (JSR), 2011 WL 651849 (S.D.N.Y. Feb. 7, 2011), we reject
their Brady claim as meritless.
Defendants can point to only one potentially material document that was not contained
in the original electronic database turned over by the government. For the reasons stated by
the district court, defendants cannot show a reasonable probability that timely disclosure of
this document would have resulted in a different outcome at trial. See id. at *5-6; United
States v. Persico, 645 F.3d 85, 111 (2d Cir. 2011); United States v. Brunshtein, 344 F.3d at
101. Accordingly, there is no need to remand, as defendants urge, for an evidentiary hearing
on their Brady claims. Cf. United States v. Erb, 543 F.2d 438, 443 (2d Cir. 1976) (rejecting
argument that claim of evidence suppression required evidentiary hearing).
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We have considered defendants’ remaining arguments and conclude that they are
without merit. For the foregoing reasons, the judgments of conviction are AFFIRMED.
FOR THE COURT:
CATHERINE O’HAGAN WOLFE, Clerk of Court
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