The opinion of the court was delivered by: John F. Keenan, United States District Judge
Defendant, Michael Roth, moves for a new trial on the ground that "newly discovered evidence" establishes that a Government witness, Shaya Waldman, perjured himself at trial. Roth urges that if the jury knew of the evidence, it would not have convicted Roth on the mail fraud conspiracy charged in the Indictment. (See January 1, 2003 Letter In Support of Defendant's Motion For A New Trial, p. 1-6).
Roth was convicted on April 17, 2002 of Conspiracy To Commit Mail Fraud (18 U.S.C. § 371) after a jury trial. That was the one count of the indictment. He was sentenced on October 8, 2002, after a Fatico hearing to a term of 30 months in prison.
The evidence at trial established that Michael Roth, a licensed public adjuster, engaged in a conspiracy to defraud insurance companies of hundreds of thousands of dollars by filing false insurance claims regarding water damage that Roth participated in causing. Roth agreed with Joseph Greenfield to cause damage at 884 East 28th Street and 1545 East 13th Street in Brooklyn, New York. The homes were then stocked with cheap and damaged furniture. The water pipes were deliberately broken and flooding of the houses and their contents resulted.
Roth prepared and submitted fraudulent claims to the insurance companies, inflating the price of the furniture damaged in the flood based on false furniture receipts. Roth settled with the insurance companies, and he and his co-conspirators received hundreds of thousands of dollars to repair the homes and replace the contents. (Tr. 67).*fn1 At trial the following witnesses, among others, testified for the Government:
(1) Special Agent Kevin O'Grady of the Federal Bureau of Investigation
("FBI"), who described Roth's admissions to him of his involvement
in the insurance fraud scheme;
(2) Nathan Baum, the nominal owner of one of the properties who was one
of Roth's co-conspirators. He testified pursuant to a cooperation
(3) Shaya Waldman, a furniture salesman who provided Roth and
Greenfield with inflated furniture receipts for the insurance
claims. He also testified pursuant to a cooperation agreement;
(4) Representatives of the two defrauded insurance companies, The
Hartford Financial Services ("Hartford"), and Fireman's Fund
Insurance Company ("Fireman's Fund")
A. 884 East 28th Street Fraudulent Claim
In 1996, Joseph Greenfield approached Roth, the licensed public adjuster, asking Roth how to file a fraudulent insurance claim on 884 East 28th Street in Brooklyn. Greenfield then lived with his wife and daughter on the second floor of that building. (Tr. 67, 138. 329). Greenfield told Roth that he owned the property at 884 East 28th Street in someone else's name. Roth later learned that Nathan Baum was the owner of record. (Tr. 65, 324-26). Greenfield told Roth that he was looking for a quick way to profit through an insurance claim on that property. (Tr. 65).
Roth described to Greenfield the different types of insurance coverage (Tr. 65) and explained that one type of insurance, structural or dwelling coverage, reimburses the insured for the costs of replacing the building structure if the building is destroyed or the costs of repairing the building if it is damaged. (Tr. 65). Roth suggested that Greenfield could not make much money on structural or dwelling coverage because the insurance company's payout on the claim would be only the actual cost of repairs. (Tr. 65-66). Roth explained that a lot more money could be made by inflating the claim on contents coverage, i.e., that type of insurance that reimburses the insured for the cost of the contents destroyed by a covered incident. (Tr. 66). Roth also told Greenfield that he could increase his profits through a false claim by obtaining: (a) additional living expenses or "ALE" coverage and (b) loss of use coverage, which reimburses an insured landlord for lost rent on the damaged property. (Tr. 66).
Roth told Greenfield that arson was not a good way to recover because insurance companies hire former fire marshals as investigators and they are more apt to detect arson. (Tr. 70) Roth recommended that Greenfield cause a flood and file a false water damage claim. This would look less suspicious and was more common. (Tr. 66, 70)
Greenfield told Waldman that he needed damaged or returned furniture for a house in Brooklyn. (Tr. 132). Waldman agreed to supply Greenfield with furniture, as well as receipts which showed inflated prices for the furniture, for $10,000. (Tr. 132-33). Waldman arranged for delivery of the furniture to 884 East 28th Street. (Tr. 134). Waldman met Roth and Greenfield. They instructed Waldman that the false receipts should total about $50,000, and that Waldman should leave key spaces on the documents blank, i.e., the name of the buyer, the date of the order, and the customer's signature. (Tr. 144, 149-50)
In May 1996, Baum, the nominal owner of 884 East 28th Street, went with Greenfield and his wife to Florida. (Tr. 330-31; GX108). While in Florida, Greenfield arranged for someone else to break a water pipe at the building. This caused substantial water damage. (Tr. 331-33). On May 28, 1996, Roth, who was listed as the public adjuster, filed the water damage claim in Nathan Baum's name with Hartford. (Tr. 66-67, 253; GX105; GX106-A). The ...