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U.S. v. CUSACK
September 17, 1999
UNITED STATES OF AMERICA, PLAINTIFF,
LAWRENCE X. CUSACK JR., A/K/A "LAWRENCE X. CUSACK III," A/K/A "LEX CUSACK," DEFENDANT.
The opinion of the court was delivered by: Cote, District Judge.
After a jury trial, defendant Lawrence X. Cusack ("Cusack") was
convicted on April 30, 1999, of thirteen counts of wire and mail
fraud in violation of 18 U.S.C. § 1341, 1343 for his role in a
fraudulent scheme involving the sale of a number of documents
that he claimed contained the handwriting of President John F.
Kennedy and other prominent figures. On May 26, 1999, the
Government gave notice of several sentencing adjustments and
departures. Subsequently, on June 28, 1999, the Court also gave
notice of several possible adjustments and departures and set a
schedule for the briefing of those issues by the parties. In
particular, the Court required the parties to address a possible
adjustment for abuse of trust, a possible criminal history
category departure based on the defendant's conduct, and the
appropriateness of any adjustment or departure based on the
defendant's wearing of a military uniform. At a conference with
the parties on July 12, 1999, the Court indicated that the
conduct cited as a basis for a criminal history departure would
also be considered as a basis for a departure under Section 5K2.0
of the Sentencing Guidelines.
On August 24, 1999, the Probation Department issued a
Presentence Investigation Report (the "PSR"). The PSR calculated
an adjusted offense level of twenty-eight as follows: a base
offense level of six, an increase of fourteen levels based on a
total loss of $7 million, an increase of two levels for more than
minimal planning under Section 2F1.1(b)(2), an adjustment of four
levels for Cusack's role in the offense under Section 3B1.1(a),
and an adjustment of two levels for obstruction of justice based
on the provision of handwriting exemplars under Section 3C1.1.
By letter dated September 3, 1999, counsel for defendant
indicated that it was only objecting to the obstruction of
justice adjustment. By a series of letters, counsel for defendant
has also objected to the adjustments and departures not included
in the PSR that have been noticed by the Government and the
Court. Finally, on September 13, 1999, the defendant moved for a
downward departure based on the defendant's diminished mental
The evidence at trial overwhelmingly established the following.
In 1993, Cusack was working as a paralegal at the law firm
founded by his father, Cusack & Stiles, and was earning between
$25,000 and $35,000 a year. His wages at the firm were being
garnished because of a number of judgments obtained against him
by creditors. Months earlier, Cusack had met John Reznikoff, a
dealer in autographs and stamps, and had learned how valuable the
autographs of famous people could be. Cusack told Reznikoff that
he had found documents in his father's files that contained the
writing and signatures of President John F. Kennedy, Marilyn
Monroe, and Robert F. Kennedy (the "Cusack Documents"). According
to Cusack, his father, Lawrence Cusack Sr. ("Cusack Sr."), had
for years been a secret adviser and confidant to President
According to Cusack and as "corroborated" by the Cusack
Documents, Cusack Sr. assisted President Kennedy with a number of
intrigues that included (1) the payment of hush money to Marilyn
Monroe to cover up an extramarital affair; (2) the cover-up of a
supposed secret marriage and subsequent secret divorce prior to
Kennedy's marriage with Jacqueline Kennedy; (3) the cover-up of
Kennedy's interactions with organized crime figures; (4)
Kennedy's attempts to prevent J. Edgar Hoover, the former
director of the FBI, from blackmailing him; and (5) Kennedy's
addiction to pain killers. The documents depicted prominent
figures in the Catholic Church, including Cardinal Spellman, as
facilitators of these intrigues.
Cusack represented himself to Reznikoff as a lawyer and as a
decorated former Navy lieutenant commander who had served in
Vietnam and Cambodia. In one of their early meetings, Cusack wore
a bomber jacket with a three-leaf colonel's cluster. The two
eventually traveled to Annapolis together where Cusack appeared
in full military dress and exchanged salutes with naval officers.
On this occasion, Cusack wore a number of awards on his chest,
including a Navy cross, one of the military's highest honors. As
their friendship developed, Cusack began to share the documents
with Reznikoff, and the two eventually entered into an agreement
whereby Reznikoff would act as Cusack's agent. Cusack and
Reznikoff then enlisted Thomas Cloud, a dealer in rare documents
with access to rich clients, to sell the documents. The three
believed that the Cusack Documents could be privately placed with
investors and later resold in an auction after they were made
public through a book or movie. To attain the high prices for the
documents that they sought, the three located a number of
collectors of Kennedy memorabilia to "authenticate" the Cusack
Documents. In the ensuing years, the three sold between 250 and
275 documents for a total of approximately $7 million. Cusack
earned approximately $5 million from the sales, which he invested
in a life of luxury.
In time, Cusack came into contact with journalists who were
interested in the Cusack Documents. Pulitzer prize-winning author
Seymour Hersh wanted to include the Cusack Documents in his new
book on the Kennedy presidency. The television network ABC and a
producer named Mark Obenhaus wanted to do a documentary on the
documents. Once these efforts intensified in 1997, however, the
journalists discovered that the documents were forgeries and
refused to proceed. In the process, the Cusack Documents were
exposed to the public as fakes and Cusack, Reznikoff,
and Cloud were forced to cease selling the documents. In 1997,
the scheme came to a close.
The evidence at trial conclusively demonstrated that all of the
Cusack Documents are indeed fakes and were authored by Cusack. As
a paralegal at Cusack & Stiles, Cusack stole documents from his
father's files, the files of Cusack & Stiles, the Surrogate's
Court, and the Archdiocese of New York. Cusack altered and
embellished these documents with the forged handwriting of
President Kennedy and others and sold them as the Cusack
Several different types of proof supported these conclusions.
First, many of the documents are highly implausible on their
face. For example, an index card containing a citation to a tax
practitioner's article was altered to suggest that Cusack Sr. and
President Kennedy shared a grin over how the article could help
them foil Hoover. Second, several of the documents contain zip
codes which were not in use until after President Kennedy's
death. Third, expert analysis revealed that the typefaces used in
many of the documents did not exist at the time the documents
were supposedly authored. Fourth, additional expert analysis
concluded that the handwriting on the documents did not belong to
President Kennedy and was likely a forgery made by Cusack.
Finally, evidence showed that only Cusack had the ability and
opportunity to carry out the fraud.
The evidence at trial also established that the stories Cusack
invented about himself and others were false. Cusack Sr. had
never had any relationship, professional or otherwise, with
President Kennedy. Cusack himself was not a lawyer and had never
served in the military.
I. Objections Related to Adjustments
A. Obstruction of Justice — Section 3C1.1
The Government argues that an obstruction of justice adjustment
is appropriate on either of two grounds: (1) the defendant's
disguising of his handwriting in exemplars provided to the
Government in response to a subpoena, and (2) the filing of a
pair of civil suits by the defendant against potential witnesses.
Cusack disputes that the handwriting exemplars show he intended
to obstruct justice. With respect to the filing of civil suits,
Cusack argues that there is no evidence of threats by him against
any witness and that the record is insufficient to support a
finding of specific intent to obstruct justice.
Section 3C1.1 of the Sentencing Guidelines authorizes a
If the defendant willfully obstructed or impeded, or
attempted to obstruct or impede, the administration
of justice during the investigation, prosecution, or
sentencing of the instant offense. . . .
U.S.S.G. § 3C1.1.*fn1 In November 1998, in order to clarify the
relationship between the obstruction and the offense, language
was added to require explicitly that "the obstructive conduct
related to (i) the defendant's offense of conviction and any
relevant conduct; or (ii) a closely related offense. . . ."
U.S.S.G. § 3C1.1 (1998). See also United States v. McKay,
183 F.3d 89, 95 (2d Cir. 1999).
The willfulness requirement in the text of Section 3C1.1
requires that "the defendant consciously act with the purpose
of obstructing justice." United States v. Case, 180 F.3d 464,
467 (2d Cir. 1999) (internal quotation omitted) (emphasis in
original). See also United States v. Reed, 49 F.3d 895, 900 (2d
Cir. 1995). In order to impose an adjustment for obstruction of
justice, a "specific finding of intent" must be made by the
sentencing court where the defendant raises the issue of his
state of mind. United States v. Bradbury, 189 F.3d 200, 204 (2d
Cir. 1999) (internal quotation omitted). This finding of intent
may be based on circumstantial evidence. United States v.
Sisti, 91 F.3d 305, 313 (2d Cir. 1996).
Application Note 3 contains a "non-exhaustive list of examples"
of obstruction that includes the following:
(a) threatening, intimidating, or otherwise
unlawfully influencing a co-defendant, witness, or
juror, directly or indirectly, or attempting to do
(b) committing, suborning, or attempting to suborn
(c) producing or attempting to produce a false,
altered, or counterfeit document or record during an
official investigation or judicial proceeding;
(f) providing materially false information to a judge
(g) providing a materially false statement to a law
enforcement officer that significantly obstructed or
impeded the official investigation or prosecution of
the instant offense. . . .
Where the basis for the adjustment is false testimony, the
sentencing court is required to make findings that the witness
made false statements regarding a matter material to the instant
action with the willful intent to provide materially false
testimony. United States v. Zagari, 111 F.3d 307, 328-29 (2d
Cir. 1997). In addition, "an unsworn denial of guilt — even a
false and material unsworn denial — cannot become the predicate
for an obstruction of justice adjustment." United States v.
Johns, 27 F.3d 31, 34 (2d Cir. 1994) (interpreting language of
App. Note 1 to Section 3C1.1, which is currently App. Note 2).
The Government first argues that Cusack obstructed justice by
giving disguised handwriting exemplars on July 22, 1998 in
response to a subpoena. The Second Circuit has noted that
there are few better examples of a classic
obstruction of justice than a defendant who refuses
to give handwriting samples when compelled by a
subpoena. [The defendant's] disguise of his
handwriting made difficult the comparison of his
writing with that in the [defendant's papers] seized
by the government, thus hindering the government in
As evidence that the defendant intentionally disguised his
handwriting and thereby obstructed justice, the Government relies
on the December 17, 1998 report of handwriting expert and trial
witness Gus Lesnevich and a follow-up affidavit from Mr.
Lesnevich, as well as the exemplars. Lesnevich's expert report
states that the handwriting exemplars "do not contain Mr.
Cusack's normal or natural handwriting habits or characteristics
and are indicative of intentionally disguised writings." Mr.
Lesnevich also provides a chart comparing different samples of
Mr. Cusack's handwriting from which, in the opinion of Mr.
[i]t is obvious . . . that Mr. Cusack lowered his
writing skill and abilities, embellished his letter
formations and changed his slant of writing when he
provided handwriting specimens on July 22, 1998.
In accordance with Lesnevich's conclusion, the exhibits to the
report comparing samples of Cusack's handwriting plainly show
them to be very dissimilar to the exemplars provided. Finally,
Lesnevich's July affidavit states that his conclusions do not
change when the defendant's ability to
write in a wide variety of styles is taken into account.
The Court has also examined the handwriting exemplars and the
samples of Cusack's daily writing. The record clearly establishes
that the defendant intentionally disguised his handwriting in the
exemplars he provided on July 22, 1998, with the specific intent
of frustrating the pending investigation of him. An adjustment
for obstruction of justice is therefore appropriate.
The Government argues that the adjustment is also appropriate
because of Cusack's filing of two civil suits, one in federal
court and another in state court, against defendants that
included eventual trial witnesses. Improper threats against
witnesses are listed in the application notes and may form the
basis for an obstruction adjustment. See, e.g., United States v.
Sovie, 122 F.3d 122, 128-29 (2d Cir. 1997) (obstruction
adjustment appropriate for threat to accuser to induce her to
drop charges against the defendant); United States v.
Hernandez, 83 F.3d 582, 585 (2d Cir. 1996) (threats made with
intent to obstruct may serve as basis for adjustment).
Suits were filed in both federal and state court. The federal
amended complaint is dated May 6, 1998, and is signed by
plaintiffs' attorney. The plaintiffs in the federal actions are
Cusack, his wife, Thomas Cloud, and several entities controlled
by them. The eighty-page complaint alleges that the Cusack
Documents were found in Cusack Sr.'s files and that the documents
are of historical importance. The defendants are the television
network ABC and a number of entities and individuals affiliated
with it, including trial witness and producer Mark Obenhaus and
trial witness and journalist Seymour Hersh. The complaint is
replete with personal attacks on the defendants based on a
documentary that was to be produced that ultimately became an
expose on the Cusack Documents.
The complaint includes the following causes of action against
all defendants: fraud based on "ambush journalism," libel,
interference with contractual relations, breach of contract, and
malicious instigation of a frivolous grand jury investigation.
With respect to Hersh, the complaint alleges that after he
initially entered into an agreement to produce a television
documentary, he and his partners conspired to "denounce [the
Cusack Documents], defame plaintiffs and embark on a libelous
attack." Obenhaus is alleged to be the head of Lancer, which was
created to "keep the dirty work away from ABC" in the production
of a documentary that defames the plaintiffs.
The federal suit was dismissed by the Honorable Judge John S.
Martin on September 9, 1998, for a failure to follow the basic
rules of pleading. At the time of dismissal, Judge Martin gave
the following admonition to defendant's criminal counsel:
I was surprised, after the criminal indictment was
filed, that this case was going forward. . . . Should
the criminal case result in a conviction, it would be
my absolute intention, if this case continues, to
write the judge who will have that sentencing and
state that, in my view, this pursuance of a civil
case in these circumstances — if the facts prove this
claim to be fraudulent — is, indeed, an additional
obstruction of justice. . . . I thought you should be
on notice of this, because this is a dangerous tactic
that is being pursued in this case.
Cusack apparently did not replead in response to the dismissal.
A second action was filed in New York state court. The amended
state complaint is dated June 10, 1998, and was apparently signed
by Cusack's attorney, although the copy provided to the Court is
unsigned. The plaintiffs in that suit are Cusack, his wife,
Cloud, entities controlled by each of them, and a number of
purchasers of the documents. The one hundred and three
page complaint is again based on the historical importance of the
documents and the nefarious deeds by the defendants to prove
their falsity. Rather than ABC, however, the defendants are
individuals and entities related to the television show 60
Minutes, which produced a story that concluded that the Cusack
Documents were forgeries. Among the defendants are journalist and
trial witness Seymour Hersh; handwriting expert Duayne Dillon,
who was retained by 60 Minutes as an expert, appeared in the 60
Minutes show on the Cusack Documents, and eventually became a
witness at trial; and Kennedy memorabilia collector and trial
witness Robert White. The claims alleged include the following: a
fraud claim based on "fraudcast" journalism in connection with
the 60 Minutes story, libel based on allegations by the
defendants that the documents were forgeries, interference with
contractual relations with respect to the purchasers of the
documents, breach of a number of agreements, breach of fiduciary
duties owed to the plaintiffs, deceptive business practices,
intentional and negligent infliction of emotional distress, and
malicious instigation of a frivolous grand jury investigation.
With respect to Hersh, the Complaint alleges that he
participated in the improper actions of the 60 Minutes defendants
and that he made a number of disparaging statements with respect
to Cusack and the documents to several different journalists and
media outlets. With respect to Dillon, the complaint attacks his
credentials as an expert and alleges that his opinion was
misrepresented on 60 Minutes. Regarding White, it is alleged that
he falsely held himself out as a handwriting expert and made
false statements on 60 Minutes defaming the plaintiffs, and that
he is liquidating his assets and planning to flee the United
States to escape criminal and civil liability. Even after
Cusack's guilty verdict, it appears that Cusack and the other
plaintiffs in the state action are seeking to continue their
civil claims against all of the defendants.
The Government first argues that the filing of these suits
amounts to obstruction of justice because the suits constitute
improper threats against witnesses. The Court agrees with the
Government that the complaints are facially outrageous in light
of the overwhelming evidence at trial that Cusack was the author
of the documents and invented a relationship between Cusack Sr.
and President Kennedy to feed his voracious lifestyle. Cusack did
not even defend the authenticity of the documents at the trial.
Instead, his counsel argued that someone else, even Cusack Sr.,
may have fabricated them. The Court also agrees that, under the
appropriate circumstances, the filing of a civil suit may support
an obstruction of justice adjustment. Nonetheless, the record is
insufficient to support a finding that Cusack specifically
intended to obstruct justice by filing these lawsuits. The
Government has provided no evidence of the context in which the
filing of the suits occurred, the status of the investigation at
the time of the filing, or any actions or statements by Cusack in
connection with the civil suits. As a result, the record will not
support a finding that Cusack filed the suits with the specific
intent of threatening witnesses to obstruct a criminal
Although it does not make entirely clear the extent to which
this argument is independent of the argument based on threats,
the Government also argues that an adjustment for obstruction of
justice is appropriate on the ground that "[v]erified false
statements by [Cusack] in a complaint in a related civil case
would logically be on the same footing as civil-case perjury."
There can be little doubt as to the falsity of the statements
contained in the complaints, but the Government has provided no
authority for the proposition that the filing of a civil
complaint containing false statements amounts to perjury within
the meaning of the Sentencing Guidelines. Instead, the definition
of perjury in the Application Note to Section 3C1.1 is modeled
on 18 U.S.C. § 1621, and requires a statement under oath that the
defendant knows to be false. See United States v. Bonds,
933 F.2d 152, 155 (2d Cir. 1991). See also Zagari, 111 F.3d at 329
(adjustment for perjury in civil deposition upon finding intent
and false testimony regarding a material matter). The complaints,
which are not even signed by Cusack, are simply not statements
made by him under oath and do not constitute perjury. For these
reasons, the record is insufficient to support an obstruction of
justice adjustment for the filing of the civil suits.
B. Use of Special Skill — Section 3B1.3
The Government seeks an adjustment for use of special skill
under Section 3B1.3. That section states that "if this adjustment
is based solely on the use of a special skill, it may not be
employed in addition to an adjustment under § 3B1.1 (Aggravating
Role). . . ." U.S.S.G. § 3B1.3. Since the Court has adopted the
PSR's recommended adjustment under Section 3B1.1 for the
defendant's role in the offense, the Guidelines do not permit it
to consider a special skill adjustment.
C. Abuse of trust — Section 3B1.3
Unlike the special skill adjustment, however, Section 3B1.3
provides that, "[i]f this adjustment is based upon an abuse of a
position of trust, it may be employed in addition to an
adjustment under § 3B1.1 (Aggravating Role)." U.S.S.G. § 3B1.1.
The Government initially sought an adjustment for abuse of trust
based on the defendant's "looting" of his father's estate after
his father's death in 1985. The Court subsequently gave notice of
a possible adjustment for abuse of trust based on Cusack's taking
of documents from the Surrogate's Court, the Archdiocese, and the
files of Cusack & Stiles. The Government argued that an
adjustment may be available for the thefts from Cusack & Stiles
and the Archdiocese but not for the theft from the Surrogate's
Court. Cusack argues that the listed entities cannot be called
victims since they suffered neither loss of money nor status, and
that the adjustment is inapplicable because it only applies where
the victim entrusts discretion to the defendant.
Section 3B1.3 authorizes an adjustment of two levels "[i]f the
defendant abused a position of public or private trust . . . in a
manner that significantly facilitated the commission or
concealment of the offense." U.S.S.G. § 3B1.3. Like any
adjustment under Chapter 3, the ...