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United States District Court, Southern District of New York

July 2, 2003


The opinion of the court was delivered by: Shirley Kram, United States District Senior Judge


Defendant Jerome E. Rosen moves for the following: (1) dismissal of Court One of the indictment, conspiracy to commit securities fraud and wire fraud; (2) dismissal of the indictment based upon lack of venue; (3) dismissal of the indictment as time barred; (4) dismissal of the indictment as predicated on false or misleading assertions; (5) a bill of particulars; and (6) early disclosure of prior bad acts and criminal convictions. Additionally, defendant David Scott Heredia moves for the following; (1) dismissal of the indictment based upon lack of venue; (2) dismissal of the indictment as time barred; and (3) dismissal of the indictment because of pre-indictment delay.*fn1 For the reasons set forth below, Rosen and Heredia's motions are denied in part and granted in part.


On September 24, 2002, defendants were charged with conspiring to commit securities fraud and wire fraud in violation of 18 U.S.C. § 371 (Count One); and securities fraud in violation of 15 U.S.C. § 78j(b) and 78ff, 17 C.F.R. § 240.10b-5, and 18 U.S.C. § 2 (Count Two). The indictment was initially filed under seal and subsequently unsealed on October 1, 2002.

The indictment alleges that defendants fraudulently manipulated the share price of H&R Enterprises, Inc. ("H&R"), a Delaware corporation with shares publicly traded through the National Association of Securities Dealers ("NASD") Automated Quotation System Over-The-Counter Market. In 1997, H&R purported to be an investment holding company with interests in vending and leasing industries. Prior to March 1997, H&R was a shell company with no purported business operations.

Heredia was president of Alexander Troy Consultants, Inc. ("Alexander Troy"), a company engaged in promoting the stock of public companies. Rosen was a trader at J. Alexander Securities, Inc. ("J. Alexander"), a securities broker-dealer registered with the SEC and a member of the NASD. Occasionally, J. Alexander was a market-maker in H&R securities.

The indictment alleges that from in or about January 1997 through September 1997, defendants and other co-conspirators engaged in a scheme to upwardly manipulate the market price and volume of H&R securities in order to personally profit from selling H&R stock that they had received at little or no cost. Beginning in July 1997, an unindicted co-conspirator ("CC-1"), an insider at H&R, caused the company to issue approximately 3 million shares to his nominees and associates at prices of between $.01 and $.50 per share. These shares were placed in securities brokerage accounts at different broker-dealers in the name of companies that CC-1 and Heredia controlled. Heredia and CC-1 agreed that Heredia would cause brokers in his control to create artificial trading volume and price increases in the public market for H&R stock in an effort to increase H&R's share price and create the opportunity for CC-1 and others to sell their holdings of H&R stock at the artificially inflated share price. In return, CC-1 agreed to convey a substantial number of H&R shares to Heredia.

The indictment further alleges that in or about June 1997, Rosen was recruited into the scheme to manipulate the price and volume of H&R stock. Rosen agreed to purchase and sell H&R stock in such amounts and at such prices as Heredia directed. In exchange, he secretly received 250,000 shares of H&R stock. To disguise his ownership of the stock, Rosen placed the shares in nominee brokerage accounts that he controlled. The purpose of this trading activity was to make it appear as though there was an active market for H&R stock, thereby increasing the share price. As a result, Heredia, Rosen and their co-conspirators could sell their H&R shares at inflated prices.

Between September 19, 1997 and September 24, 1997, the conspirators artificially increased H&R's stock price from $2 per share to over $6.75 per share. As the share price increased, the conspirators sold the large blocks of H&R shares that they had received at little or no cost, and reaped millions in profits. During the course of the conspiracy, Rosen personally generated gross profits of approximately $546,163.96 from the sale of his H&R stock.

On September 24, 1997, Heredia directed Robert J. Prager, a trader at Saperston Financial, Inc. ("Saperston") to sell approximately 1.2 million shares of H&R to defendant Timothy R. Chamberlain, a trader at Equitrade Securities, Inc. ("Equitrade"). Heredia fraudulently represented to Prager that purchasers affiliated with Heredia at Equitrade would accept delivery and pay for those shares, as they had done in the past. On the same date, Rosen, on behalf of, and using funds from J. Alexander, sold approximately 600,000 shares to Equitrade. In order to ensure that Saperston and J. Alexander would be left holding the H&R stock when the manipulative trading ended, Heredia, contrary to his representations to Prager, did not accept delivery or pay for all of the 1.2 million shares that Prager had sold to various Equitrade accounts controlled by Heredia. Heredia also did not accept delivery of the 600,000 shares that Rosen sold on behalf of J. Alexander. As a result, Saperston and J. Alexander were left with shares whose value rapidly declined. H&R's stock price fell below $2 within two days.

On November 14, 2002, the Government provided an initial disclosure of discovery to defendants' counsel pursuant to Rule 16 of the Federal Rules of Criminal Procedure. See Affirmation of AUSA Deirdre A. McEvoy, dated May 2, 2003 ("McEvoy Aff.") at ¶ 2. The Government supplemented the initial disclosure on two occasions; on December 4, 2002, and on January 14, 2003. See id. at ¶ 4.


I. Rosen's Motion to Dismiss The Conspiracy Charge Based Upon Insufficiency
Rosen moves to dismiss Count One of the indictment for failure to adequately charge him with conspiracy to commit securities fraud and wire fraud. Rosen argues that he had no knowledge of the conspiracy, and did not agree with or share an intent to manipulate the stock price of H&R in order to sell shares at an inflated price. Furthermore, Rosen claims that he suffered a financial loss as a result of the conspiracy.

Rule 7 of the Federal Rules of Criminal Procedure provides that "[t]he indictment . . . shall be a plain, concise and definite written statement of the essential facts constituting the offense charged." Fed.R.Crim.P. 7(c)(1). As the Supreme Court and the Second Circuit have repeatedly stated, "an indictment is sufficient if it, first, contains the elements of the offense charged and fairly informs a defendant of the charge against which he must defend, and, second, enables him to plead an acquittal or conviction in bar of future prosecutions for the same offense." Hamling v. United States, 418 U.S. 87, 117 (1974); see also United States v. Pirro, 212 F.3d 86, 91 (2d Cir. 2000). In order to satisfy these requirements, "an indictment need do little more than to track the language of the statute charged and state the time and place (in approximate terms) of the alleged crime." United States v. LaSpina, 299 F.3d 165, 177 (2d Cir. 2002) (quotation omitted).

The indictment in this matter cites to the applicable statutes for conspiracy to commit securities fraud and wire fraud. Moreover, the language of the indictment essentially tracks these statutes verbatim and also contains extensive factual allegations as to Rosen's alleged agreement to enter into the conspiracy and his alleged involvement in it. See United States v. Trochelmann, No. 98 Cr. 1276, 1999 WL 294992, *2 (S.D.N.Y. May 11, 1999). The indictment also identifies the approximate dates of Rosen's alleged crimes, and the approximate location of the conspiracy. See United States v. Hanna, 198 F. Supp.2d 236, 243 (E.D.N.Y. 2002). Accordingly, the Court finds that Count One of the indictment provides Rosen with the required adequate notice of the nature of the charged conspiracy.

Rosen also alleges that he was a victim of the fraudulent scheme and claims that during the period of September 19 through September 24, 1997, he experienced a personal financial loss. According to the indictment, in June 1997, Heredia recruited Rosen and other traders into a scheme to manipulate the price and volume of H&R. See Indictment ¶ 11. Rosen agreed to purchase and sell H&R stock in such amounts and at such prices as Heredia directed, and in return received 250,000 shares of H&R stock was traded in a circular fashion among various brokerage accounts. See Indictment ¶ 13.

The indictment alleges that as a result of the circular trading and H&R's issuance of a series of false and misleading press releases, H&R's stock price artificially increased from $2 per share on September 19 to over $6.75 per share on September 24. See Indictment ¶ 16. As the stock price increased, Rosen, Heredia, CC-1 and others allegedly sold the H&R stock they had obtained at little or no cost into the inflated market, thus reaping millions of dollars in profits. See id. Rosen allegedly realized gross profits of approximately $546,000 by selling his personal H&R stock. See Indictment ¶ 23.

On September 24, Rosen, on behalf of, and using funds from J. Alexander, sold approximately 600,000 shares of H&R stock to a brokerage account controlled by Heredia at Equitrade. See Indictment ¶ 19-20. The indictment alleges that in furtherance of the scheme, Heredia wanted J. Alexander, among others, to be left holding H&R stock when the daisy chain ended. See Indictment ¶ 20. Equitrade did not accept delivery of the shares, which caused J. Alexander to continue holding them at a cost of $5.625 per share. See id. With the daisy chain no longer in place, H&R's share price dropped below $2.00 within two days. See Indictment ¶ 21.

Rosen claims that because he was contractually obligated to reimburse J. Alexander for losses he incurred while trading on behalf of the firm's account, his personal financial losses exceeded any alleged financial gains. See Affirmation of Maranda E. Fritz, dated February 28, 2002, at ¶ 15-16. However, simply because Rosen incurred a financial loss in the end does not negate Rosen's culpability for his alleged participation in the conspiracy. See United States v. Finkelstein, 526 F.2d 517, 522 (2d Cir. 1975) ("That certain defendants were eager to cheat each other for a large slice of the spoils does not obscure the unifying means used by all of them to defraud the public in the first place.").

II. Venue

Defendants Rosen and Heredia move to dismiss both counts of the indictment for improper venue in the Southern District of New York.

Article III of the United States Constitution and the Sixth Amendment guarantee the right to trial in the district in which the offense was committed. U.S. Const. art. III, § 2, cl. 3 ("The Trial of all crimes . . . shall be held in the State where the said Crimes shall have been committed."); U.S. Const. amend. VI ("In all criminal prosecutions, the accused shall enjoy the right to a speedy public trial, by an impartial jury of the State and district wherein the crime shall have been committed."). Rule 18 of the Federal Rules of Criminal Procedure further codifies the constitutional requirements, providing that "prosecution shall be had in a district in which the offense was committed." Fed.R.Crim.P. 18; see United States v. Saavedra, 223 F.3d 85, 88 (2d Cir. 2000).

In a conspiracy prosecution, "venue is proper in any district in which an overt act in furtherance of the conspiracy was committed by any of the coconspirators." United States v. Smith, 198 F.3d 377, 382 (2d Cir. 1999) (quoting United States v. Naranjo, 14 F.3d 145, 147 (2d Cir. 1994)). Venue for violations of federal securities laws is proper "in the district wherein any act or transaction constituting the violation occurred." 15 U.S.C. § 78aa.

Defendants contend that the indictment alleges no conduct by either Rosen or Heredia in the Southern District of New York. Instead, according to defendants, the indictment only alleges that Prager made two separate purchases of H&R stock from Fahnestock, Inc. ("Fahnestock"), a securities broker-dealer located in New York, New York. Defendants further contend that the indictment is devoid of allegations as to Prager communicating with any New York office of Fahnestock or that the trades cleared in the Southern District of New York.

On its face, the indictment alleges that both offenses occurred "in the Southern District of New York and elsewhere," which is sufficient to resist a motion to dismiss. Indictment ¶ 24, 28, 30; see, e.g., United States v. Bellomo, No. 02 Cr. 140, 2003 WL 21078757, *17 (E.D.N.Y. Mar. 13, 2003); United States v. Szur, No. 97 Cr. 108, 1998 WL 132942, *9 (S.D.N.Y. Mar. 20, 1998). On a motion to dismiss the indictment, the allegations of the indictment must be taken as true. See United States v. Goldberg, 756 F.2d 949, 950 (2d Cir. 1985). Whether the acts alleged in the indictment "in fact occurred in the Southern District of New York is appropriately left for trial, at which time the Government will be required to prove by a preponderance of the evidence `that the crime was committed in the district in which the prosecution was brought.'" Szur, 1998 WL 132942 at *9 (quoting United States v. Beech-Nut, 871 F.2d 1181, 1188 (2d Cir. 1989)). Accordingly, the Court denies the motion to dismiss for lack of venue without prejudice subject to renewal under Rule 29 of the Federal Rules of Criminal Procedure.

III. Statute of Limitations

Defendants Rosen and Heredia argue that the alleged conspiracy ended prior to September 24, 1997, and, therefore, the indictment, which was returned by the grand jury on September 24, 2002, is barred by the statute of limitations. Rosen argues that the conspiracy ended on September 23, 1997, while Heredia argues that the conspiracy ended on or before September 19, 1997. Defendants alternatively argue that even if the alleged conspiracy ended on September 24, 1997, because the indictment was sealed until October 1, 2002, and the five year statute of limitations expired on September 24, 2002, the indictment is still time barred.

Title 18, United States Code, Section 3282 states:

Except as otherwise expressly by law, no person shall be prosecuted, tried, or punished for any offense, not capital, unless the indictment is found . . . within five years next after such offense shall have been committed.
The charge of conspiring to commit securities fraud and wire fraud, and the charge of securities fraud are both subject to this five-year statute of limitations. See United States v. Scop, 846 F.2d 135, 138 (2d Cir. 1988).

In order for a charge of conspiracy to fall within the statute of limitations, "(1) the conspiracy must still have been ongoing within the five year period preceding the indictment, and (2) `at least one overt act in furtherance of the conspiratorial agreement [must have been] performed within that period.'" United States v. Ben Zvi, 242 F.3d 89, 97 (2d Cir. 2001) (quoting Grunewald v. United States, 353 U.S. 391, 396-97 (1957)) (alteration in original). In this case, the indictment alleges that the conspiracy began in or about January 1997 and continued through September 29, 1997. See Indictment ¶ 24. Furthermore, the indictment alleges the commission of overt acts in furtherance of the conspiracy on September 24, 1997. See Indictment ¶ 28. As to the charge of securities fraud, the indictment alleges that defendants engaged in securities fraud from in or about January 1997 up to and including September 29, 1997. See Indictment ¶ 30. Therefore, the Court rejects defendants' argument that the statute of limitations expired prior to September 24, 2002.

Defendants argue that even if the indictment was returned prior to the expiration of the limitations period, it expired during the time the indictment was under seal. The indictment was returned by the grand jury on September 24, 2002, but sealed until October 1, 2002. Defendants allege that between these two dates the statute of limitations for both charges expired. Defendants further contend that the decision to seal the indictment was improper, and, therefore, it should be dismissed or, in the alternative, a hearing should be convened.

Ordinarily, an indictment is "found" within the meaning of Section 3282 "when it is returned by the grand jury and filed." United States v. Srulowitz, 819 F.2d 37, 40 (2d Cir. 1987). However, "where the prosecution can demonstrate that the decision to keep an indictment secret is informed by the exercise of sound discretion in the public interest, the date of return rather than the date of unsealing, will establish the time the indictment is `found.'" United States v. Southland Corp., 760 F.2d 1366, 1379-80 (2d Cir. 1985).

Second Circuit case law requires a three-part inquiry by the Court where the defendant challenges the sealing of an indictment. See United States v. Weiss, No. 92 Cr. 890, 1993 WL 256707, *4 (S.D.N.Y. July 7, 1993) First, the Court must examine whether the original decision to seal the indictment proper. See id. If the initial sealing was not justified, there is no tolling the statute of limitations, and the indictment must be dismissed as untimely. See Southland, 760 F.2d at 1379-80. Second, assuming a proper sealing, whether the length of time the indictment was sealed was reasonable. See Weiss, 1993 WL 256707 at *4. Third, was the defendant prejudiced by the sealing of the indictment. See id.

Applying this analysis to the facts of this case, the Court finds that the indictment was "found" when it was returned by the grand jury, September 24, 2002, rather than on the date it was unsealed, October 1, 2002.

A. The Decision To Seal The Indictment Was Proper

"[T]he Government must show that it had a reasonable and good faith basis for requesting the sealing of the indictment." Id. Rule 6(e)(4) of the Federal Rules of Criminal Procedure provides, in pertinent part:

The federal magistrate to whom an indictment is returned may direct that the indictment be kept secret until the defendant is in custody or has been released pending trial.
The Second Circuit has held that facilitation of arrest is a legitimate prosecutorial objective which justifies the sealing of an indictment. Srulowitz, 819 F.2d at 37 (citation omitted); see also Weiss, 1993 WL 256707 at *5 ("Where a defendant is not in custody, and his whereabouts are unknown, the Government has a legitimate prosecutorial objective in seeking the sealing of an indictment."). The Government need not prove that a defendant poses a risk of flight. See id. It is enough for the Government to say that it does not know whether a defendant poses such a risk because it did not know where a defendant is, or what ties he has to his community. See id.

Here, the Government asserts that it was necessary to seal the indictment because each defendant was "a potential flight risk." Declaration of William McGrogan, dated May 2, 2003 ("McGrogan Decl."), at ¶ 4. The Government bases this assessment on the grounds that at the time the indictment was returned, it was uncertain of each defendant's respective location, the extent of their respective community ties, and the substantial profits realized from the fraud charged in the indictment. See id.

Defendants argue that prior to the return of the indictment, the Government had already obtained documentation regarding the employment and residence of each defendant. Consequently, defendants claim that even a cursory review of that documentation by the Government would have resulted in the discovery of each defendant's then current address and employment, thus negating the need to seal the indictment.

However, whether the Government knew or should have known the respective locations of each defendant when the indictment was returned is not part of the analysis required of the Court. See Weiss, 1993 WL 256707 at *5 ("The Government's pre-indictment investigative competence is not relevant to this inquiry.") Instead, the analysis properly begins when the indictment was returned. See id. Moreover, it is enough for the Government to say that at that time it did not know whether defendants posed a flight risk, because it did not know where each defendant was, or what ties each had to their respective communities. See id.

Here, the Government has made such a showing. Therefore, the Court finds that since the Government had not determined whether defendants posed a risk of flight at the time the indictment was returned by the grand jury, it was proper to seal it so that each defendant could be taken into custody.

B. Length Of Sealing Period Was Reasonable

Once an indictment is properly sealed, the Government must justify the continuation of that order. See United States v. Watson, 599 F.2d 1149, 1154 (2d Cir. 1979) (finding reasonable a 16 month sealing of an indictment in order to facilitate location of defendants). Here, the indictment was sealed for seven days. The investigator assigned to this case conducted a diligent investigation that resulted in locating each defendant soon after the indictment was returned by the grand jury. See McGrogan Decl. at ¶ 5. Simultaneously, the investigator coordinated the organization of two arrest teams. See id. at ¶ 6. After verifying the contact information for defendants, the earliest possible date to arrest them was October 1, 2001. See id. at ¶ 7. Heredia was arrested on that date, and Rosen was arrested on October 9, 2002. See id. ¶¶ 8-10. Under these circumstances, the Court finds that the seven days the indictment was sealed was reasonable

C. Actual Prejudice

Neither defendant has asserted "substantial, irreparable, actual prejudice" from the seven day delay, nor can the Court discern any conceivable prejudice from such a delay. Id. at 41; United States v. Southland Corp., 760 F.2d 1366, 1380 (2d Cir. 1985). Therefore, the Court will not convene a hearing on whether the Magistrate Judge's decision to seal the indictment was an appropriate exercise of his discretion. See United States v. Greer, 178 F.R.D. 418, 430 (Vt. 1998).

Given the circumstances presented by this case, defendants' motion to dismiss the indictment is denied. The decision by the Magistrate Judge to seal the indictment was proper, the indictment was sealed no longer than was reasonably necessary to satisfy legitimate prosecutorial purposes, and defendants suffered no prejudice. Therefore, the Court finds that the indictment is found, for statute of limitations purposes, at the time it was returned by the grand jury, September 24, 2002, not when it was unsealed.

IV. Grand Jury Minutes

Defendants argue that the indictment appears to have been predicated on the presentation of misleading information to the grand jury and should therefore be dismissed. First, defendants' claim that the allegation that Rosen sold his H&R shares at an inflated price is misleading. Second, defendants' also claim that the allegation that Rosen's employer, J. Alexander, was left holding H&R stock while Rosen personally profited from trading the securities is misleading. As a result, defendants assert that the indictment should be dismissed, or, in the alternative, the grand jury minutes inspected in camera by the Court.

"Grand jury proceedings carry a presumption of regularity." United States v. Torres, 901 F.2d 205, 232-33 (2d Cir. 1990) (citations and quotation omitted). This presumption can be overcome, and inspection of grand jury minutes authorized, when a defendant presents "specific factual allegations of governmental misconduct." Id.

In this case, defendants have not offered any credible factual allegations of Government misconduct. Instead, defendants' assertions, which are disputed by the Government, amount to a challenge to the reliability or sufficiency of the evidence presented to the grand jury.

In United States v. Williams, 504 U.S. 36 (1992), the Supreme Court barred any challenge to the sufficiency of evidence before the grand jury, and then continued:

It would make little sense, we think, to abstain from reviewing the evidentiary support for the grand jury's judgment while scrutinizing the sufficiency of the prosecutor's presentation. A complaint about the quality or adequacy of the evidence can always be recast as a complaint that the prosecutor's presentation was `incomplete' or `misleading.'
Id. at 54-55. The Williams Court concluded that reviewing facially valid indictments on such grounds "`would run counter to the whole history of the grand jury institution [,] [and] [n]either justice nor the concept of fair trial requires [it].'" Id. (quoting Costello v. United States, 350 U.S. 349, 364 (1956)).

The indictment is valid on its face. Consequently, defendants' argument that the indictment was based on misleading information, even if correct, would not provide grounds to dismiss it. See United States v. Bok, No. 95 Cr. 403, 1997 WL 148815, *. (S.D.N.Y. Mar. 27, 1997). Moreover, there is no particularized need, based on these allegations, to examine the minutes of the grand jury that returned the indictment. See id. Therefore, defendants' motion to inspect the grand jury minutes and to dismiss the indictment because of the alleged presentation of misleading information to the grand jury is denied.

V. Bill of Particulars

Defendants argue that they are entitled to a bill of particulars pursuant to Rule 7(f) of the Federal Rules of Criminal Procedure.

Rule 7(f) . . . permits a defendant to seek a bill of particulars in order to identify with sufficient particularity the nature of the charge pending against him, thereby enabling defendant to prepare for trial, to prevent surprise, and to interpose a plea of double jeopardy should he be prosecuted a second time for the same offense. . . . Generally, if the information sought by the defendant is provided in the indictment or in some acceptable alternative, no bill of particulars is required.
United States v. Bortnovksy, 820 F.2d 575, 574 (2d Cir. 1987); United States v. Conley, No. 00 Cr. 816, 2002 WL 252766, *4 (S.D.N.Y. Feb. 21, 2002).

The decision whether to grant a bill of particulars rests within the sound discretion of the district court. See United States v. Cephas, 937 F.2d 816, 823 (2d Cir. 1991); United States v. Reddy, No. 01 Cr. 58, 2002 WL 15610, *5 (S.D.N.Y. Jan. 7, 2002). The Second Circuit has "consistently sustained indictments which track the language of the statute and, in addition, do little more than state time and place in approximate terms." United States v. Salazar, 485 F.2d 1272, 1277 (2d Cir. 1973) (citing United States v. Fortunato, 402 F.2d 79, 82 (2d Cir. 1968)). Therefore, a "bill of particulars should be required only where the charges of the indictment are so general that they do not advise the defendant of the specific acts of which he is accused." United States v. Torres, 901 F.2d 205, 234 (2d Cir. 1990).

A bill of particulars is not meant to be a tool to compel disclosure of the Government's case before trial. See United States v. Gottlieb, 493 F.2d 987, 994 (2d Cir. 1974); United States v. Nova-Nunez, No. 96 Cr. 599, 1997 WL 30965, *4 (S.D.N.Y. Jan. 24, 1997). The Government is not required to disclose the manner in which it will attempt to prove the charges, nor the means by which the crimes charged were committed. Therefore, "the Government is not required to provide information that would, in effect, give the defendant a preview of the Government's case before trial." Conley, 2002 WL 252766 at *4.

In deciding a motion for a bill of particulars, "[t]he important question is whether the information sought is necessary, not whether it is helpful." United States v. Facciolo, 753 F. Supp. 449, 451 (S.D.N.Y. 1990). Here, the Government argues that defendants seek the "wheres, whens, and with whoms" regarding the charges in the indictment. Government's Memorandum of Law in Opposition to Defendants' Pre-Trial Motions at 58. Pursuant to United States v. Jimenez, 824 F. Supp. 351, 363 (S.D.N.Y. 1993), defendants are not entitled to such information, disclosure of which could serve to limit the Government's proof at trial. The indictment in this case clearly specifies the nature of the acts with which defendants are charged, the dates and approximate place of where and when the alleged events occurred, and the means and methods by which the charges were carried out. The Government has provided defendants with ample discovery regarding the allegations in the indictment, including, inter alia, documents from the NASD. See McEvoy Aff. at 4. The information sought by defendants is exactly the type "routinely denied in the Second Circuit," United States v. Henry, 861 F. Supp. 1190, 1193 (S.D.N.Y. 1994), and therefore, defendants' motion for a bill of particulars is denied.

VI. Rule 404(b) Notice

Defendants move to preclude the Government from introducing at trial evidence of any prior bad or illegal acts or criminal convictions pursuant to Rule 404(b) of the Federal Rules of Evidence. In the alternative, defendants move for disclosure of such evidence at a time which will permit defendants an opportunity to move to preclude its introduction during trial.

Rule 404(b) allows the admission of evidence of other crimes, wrongs, or acts in order to prove "motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or accident, provided that upon the request by the accused, the prosecution in a criminal case shall provide reasonable notice in advance of trial, or during trial if the court excludes pretrial notice on good cause shown, of the general nature of any evidence it intends to introduce at trial." Fed.R.Evid. 404(b).

The Government represents that at least ten working days prior to the commencement of trial, it shall provide notice of Rule 404(b) evidence to defendants. It has been the practice of courts in this circuit to deem notice afforded more than ten working days before trial as "reasonable" within the meaning of Rule 404(b). See, e.g., United States v. Triana-Mateus, No. 98 Cr. 958, 2002 WL 562649, *6 (S.D.N.Y. Apr. 15, 2002); United States v. Greco, No. 85 Cr. 961, 1994 WL 202605, *2 (S.D.N.Y. May 23, 1994). The defendants' motion is granted in so far as the Government is hereby ordered to provide notice of its Rule 404(b) evidence no later than two weeks prior to the commencement of this matter. This disclosure schedule will allow the Court to consider any Rule 404(b) motions in limine without interruption of the trial.

VII. Pre-Indictment Delay

Heredia argues that his rights may have been impaired by the inordinate delay between the alleged commission of the charged criminal acts and subsequent prosecution. Although the Supreme Court has noted that the "primary guarantee against bringing overly stale criminal charges" is the applicable statute of limitations, United States v. Marion, 404 U.S. 307, 321 (1971), excessive pre-indictment delay may, under certain circumstances, violate a defendant's Fifth Amendment right to due process. United States v. Lovasco, 431 U.S. 783, 789 (1977). In order to have an indictment dismissed for undue pre-indictment delay, a defendant bears the heavy burden of demonstrating both "actual prejudice to the defendant's right to a fair trial and unjustifiable Government conduct." United States v. Elsbery, 602 F.2d 1054, 1059 (2d Cir. 1979).

Here, Heredia has failed to provide any substantiation beyond his conclusory assertion that his rights may have been impaired due to the Government's delay in prosecuting him. Accordingly, Heredia's motion to dismiss the indictment based upon undue delay is denied.


For the reasons set forth above, defendants' motions are granted in part and denied in part. The parties are hereby directed to appear for a pre-trial conference on July 23, 2003, at 10:30 a.m., in Room 906, 40 Centre Street, New York, New York.


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