Justia White Collar Crime Opinion Summaries

Governor Strickland appointed Terry to fill a vacancy on the Cuyahoga County Court of Common Pleas. Terry sought reelection to retain the seat and enlisted the help of County Auditor Russo, a presence in Cleveland politics. The FBI was investigating Russo and had tapped his phones. Russo had a phone conversation with an attorney about foreclosure cases on Terry’s docket and promised to make sure Terry did what he was “supposed to do.” Later, by phone, Russo told Terry to deny motions for summary judgment. Terry said he would and did so. Russo ultimately pled guilty to 21political corruption counts and received a 262-month prison sentence. Terry was convicted of conspiring with Russo to commit mail fraud and honest services fraud; and honest services fraud by accepting things of value from Russo and others in exchange for favorable official action, 18 U.S.C. 201(b)(2).. The district court sentenced him to 63 months. The Sixth Circuit affirmed, quoting once-Speaker of the California General Assembly, Jesse Unruh, “If you can’t eat [lobbyists’] food, drink their booze, . . . take their money and then vote against them, you’ve got no business being [in politics],” View "United States v. Terry" on Justia Law

For more than 20 years, Kurlemann built and sold luxury homes in Ohio. In 2005-2006 he borrowed $2.4 million to build houses in Mason. When neither sold, he enlisted realtor Duke, who found two straw buyers, willing to lie about their income and assets on loan applications that Duke submitted to Washington Mutual. Both buyers defaulted. Duke pled guilty to seven counts, including loan fraud and making false statements to a lending institution, and agreed to testify at Kurlemann’s trial. A jury convicted Kurlemann of six counts, including making false statements to a lending institution, 18 U.S.C. 1014; and bankruptcy fraud, 18 U.S.C. 157. The district court sentenced Kurlemann to concurrent 24-month sentences and ordered him to pay $1.1 million in restitution. The district court sentenced Duke to 60 months. The Sixth Circuit affirmed the bankruptcy fraud conviction, based on Kurlemann’s concealment of his interest in property, but reversed and remanded his false statements conviction, finding that the trial court improperly instructed the jury that concealment was sufficient to support conviction. The court also reversed Duke’s sentence, finding that the court failed to explain the sentence it imposed. View "United States v. Kurlemann" on Justia Law

Wyko sold parts to tire manufacturers, but in the U.S., provided parts for steel tire-assembly machines only for Goodyear. Wyko contracted with HaoHua, owned by the Chinese government, to supply parts unlike any it had previously built. Goodyear used machines like those Wyko needed. Goodyear asked Wyko to repair tire-assembly machines. Wyko sent engineers. Before their visit, both signed agreements that they might have access to trade secrets or other confidential information and that they would not disclose that information. A security guard reminded them that no cameras were allowed inside the factory. Unescorted for a few minutes, one engineer used his cell-phone camera to take photos that were forwarded to the design team. Wyko’s IT manager forwarded the e-mail to Goodyear. Goodyear notified the FBI. Convicted of theft of trade secrets (18 U.S.C. 1832(a)) and wire fraud (18 U.S.C. 1343, 1349), the engineers were sentenced to four months of home confinement, community service, and probation. The Sixth Circuit affirmed the convictions, rejecting an argument that the photographs did not meet the statutory definition because Goodyear did not take “reasonable measures” to protect secrecy. The court reversed the sentences because the court had not adequately explained its calculation of loss. View "United States v. Howley" on Justia Law

Defendant pleaded guilty to one count of conspiracy to commit money laundering and thirty counts of money laundering. On appeal, defendant challenged the portion of his sentence that imposed forfeiture and restitution. Defendant argued that, because the FBI was essentially a part of the DOJ, the two entities were functionally the same. Thus, he argued, requiring him to pay forfeiture to the DOJ and restitution to the FBI would result in an impermissible double recovery for the government. The court concluded that the two payments represented different types of funds: punitive and compensatory. They were different in nature, kind, and purpose. Therefore, it was irrelevant as to what extent the FBI and DOJ were distinct entities and the district court did not clearly err when it did not offset defendant's forfeiture amount. View "United States v. Davis" on Justia Law

In 2008, a federal grand jury indicted co-defendants Carolyn Kravetz and Boris Levitin on charges stemming from a scheme to defraud restaurant franchisor Dunkin' Brands Inc. Defendants pled guilty in February 2010. Jim Edwards, a journalist who specialized in coverage of the advertising industry for Bnet.com, began covering the proceedings in 2009. During the proceedings, Edwards noticed that various documents were filed under seal in the criminal case. Edwards subsequently moved to unseal the documents. Kravetz opposed the motion, and the district court denied the motion. The First Circuit Court of Appeals vacated in part and remanded, holding (1) a presumption of public access attached to Defendants' sentencing memoranda and sentencing letters submitted by third parties on Defendants' behalf; and (2) therefore, the district court was required to state with greater specificity its reasons for denying Edwards' motion to unseal these documents. View "United States v. Kravetz" on Justia Law

Defendant appealed his conviction and sentence for crimes related to his involvement in an investment scheme which resulted in nearly $100 million dollars in losses for investors. The court held that defendant's Fifth Amendment rights were not violated where the government limited its case to events occurring while defendant was an owner of A&O to simply prove a more narrow conspiracy than was charged in the superseding indictment. Because the conspiracy proven was within the scope of those alleged in the unredacted indictment, the narrowing at most created a non-fatal variance. Finally, the court rejected defendant's claims that his sentence was procedurally and substantively unreasonable. Accordingly, the court affirmed the convictions and sentence. View "United States v. Allmendinger" on Justia Law

Defendant was convicted of crimes related to his involvement in an elaborate fraudulent sweepstakes scheme out of Costa Rica that primarily targeted elderly United States citizens. On appeal, defendant challenged the restitution order that the district court entered after the court remanded his case for resentencing. The court held that the district court lacked the authority to reconsider the restitution on remand and vacated the order, remanding with instructions to the district court to reinstate the previous restitution order. View "United States v. Pileggi" on Justia Law

Defendant pled guilty to Student Aid Fraud, Bank Fraud, and Social Security Fraud. Defendant appealed from the district court's judgment on several grounds. The court held that the district court erred in describing the elements of Student Aid Fraud; however, the error did not affect defendant's substantial rights. The court found no merit in any of the remaining claims raised by defendant on appeal. Accordingly, the court affirmed the judgment. View "United States v. Moore" on Justia Law

Defendant was convicted of one count of attempting to evade or defeat a tax; four counts of willful failure to file a tax return; and one count of attempting to interfere with the administration of internal revenue laws. Defendant appealed. Although the court granted defendant's motion to reconsider the clerk's denial of his motion to extend the time for filing a reply and allowed the brief to be submitted to the court, the court nevertheless concluded that the district court did not err in any respect. Because the court held that there were no merits to any of defendant's substantive points, and because the court held that the statute of limitations accrued from the last evasive act under 26 U.S.C. 6531(2), the court affirmed the judgment. View "United States v. Irby, Jr." on Justia Law

Defendant appealed from two counts of theft of public money and one count of committing acts affecting a personal financial interest. The court held that the district court did not err in denying defendant's motion to dismiss where it properly exercised extraterritorial jurisdiction over him. The court also held that the district court properly denied defendant's motion to suppress his post-arrest statements to FBI and DOS agents. The court further held that there was sufficient evidence to sustain his convictions on the two counts of theft of public money. Accordingly, the court affirmed the judgment. View "United States v. Ayesh" on Justia Law