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United States v. Benacquista

February 10, 2010

UNITED STATES OF AMERICA,
v.
KIM BENACQUISTA, RAYMOND BENACQUISTA, DEFENDANTS.



The opinion of the court was delivered by: Honorable Hugh B. Scott United States Magistrate Judge

Hon. Hugh B. Scott

Order

Before the Court is the Government's motion for reconsideration (Docket No. 52*fn1 ) of the second Report and Recommendation (Docket No. 51) entered in this case. Response from defendant was due by January 15, 2010, and the motion was argued on January 20, 2010 (Docket No. 55). Familiarity with the Report and Recommendation is presumed.

BACKGROUND

Defendants Kim Benacquista (hereinafter "Kim") and Raymond Benacquista (hereinafter "Raymond") are charged with two counts of willfully making false statements in their tax returns, both in violation of I.R.C. § 7206(1), and one count of conspiracy to defraud the United States, in violation of 18 U.S.C. § 371, from defendants' tax returns for 2002 and 2003 and the statement of income they received from Kim's business, Quality Quick Printing ("Quality") on tax returns filed for those tax years (see Docket No. 1, Indict.). Defendants separately moved for various pretrial relief (Docket No. 29 (Kim), 26 (Raymond)); pertinent to this motion, defendant Raymond Benacquista seeks suppression of evidence seized pursuant to two search warrants, and alternatively has sought a Franks hearing, see Franks v. Delaware, 438 U.S. 154 (1978) (Docket No. 26, Raymond Defense Attorney Aff. ¶¶ 4-7, 8-30; see Docket No. 29, Kim Benacquista Motion at 26-27, 27-31, 49 (joining in co-defendant's motions, including suppression motion)).

After an initial Report and Recommendation (Docket No. 36) denied defense motion to dismiss but granting a suppression hearing, a Franks hearing was held on July 29 and August 24, 2009 (Docket Nos. 40, 41, 45, 46) on five alleged misrepresentations Government agents made to Magistrate Judge Schroeder in applying for search warrants to search defendants' home and Quality's offices (see Docket No. 52, Gov't Atty. Aff. ¶ 3). The subsequent Report and Recommendation issued recommended denying defense motions to suppress (Docket No. 51). The Government seeks reconsideration of some findings leading to that recommendation, but do not seek reconsideration of the ultimate recommendation (Docket No. 52,Gov't Atty. Aff. ¶ 5 n.1). The time for objections to this second Report have been extended in light of the Government's pending reconsideration motion (see Docket No. 54).

Government's Motion for Reconsideration

The Government now argues that some of the factual findings "could adversely affect [Special Agent Maxine Menshon's] career as a Special Agent" and these findings "bear on SA Menshon's credibility" should be reconsidered (Docket No. 52, Gov't Atty. Aff. ¶ 5). First, the Government argues that the Court's finding (for defendants' first and fifth alleged misrepresentations) that Menshon "misconstrued" expenses when she testified that "cost of goods sold" was an expense under Schedule C to calculate defendants' tax liability (id. ¶ 7; cf. Docket No. 51, 2d R&R at 9-11), contending that this finding impunes Menshon's credibility in this case (and potentially other cases) (Docket No. 52, Gov't Atty. Aff. ¶¶ 7, 6). The Government points to Menshon's seventeen years experience at the Internal Revenue Service ("IRS" or "Service") and that her testimony that "cost of goods sold" was an expense was uncontroverted, concluding the use of the term "expense" was a "colloquial use" (id. ¶ 7).

Second, the Government seeks reconsideration of the finding for the fourth alleged misrepresentation (cf. Docket No. 51, 2d R&R at 12) that the amended tax return furnished by attorney Gary Borek was "filed" with the IRS when, in fact, any document formally is "filed" with the Service when it is accepted by the Service not just when it is submitted for filing by a tax payer or his or her representative (Docket No. 52, Gov't Atty. Aff. ¶ 9). Further, the Government points out that Menshon testified that she was not aware of whether defendants submitted the amended return to the IRS (see id.; see Docket No. 41, Tr., July 29, 2009, at 31-32 (Menshon's testimony)).

Defendants separately respond that reconsideration is inappropriate here or not authorized by the Federal Rules; the more correct route was for the Government to file formal objections to the Report to the District Judge, which now may be time barred (Docket No. 56, Raymond Atty. AFf. ¶¶ 8-11; Docket No. 57, Kim Atty. Decl. ¶¶ 6, 7-11). Kim moved for extension of time to file her objections (Docket No. 53), which was granted by then-Chief Judge Arcara (Docket No. 54). Defendants later jointly moved for a further extension of the objections deadline (Docket No. 57).

Kim contends, on the merits, that there is no basis for altering the Report (Docket No. 57, Kim Atty. Decl. ¶¶ 13-18), while Raymond concludes that the Government's reason for reconsideration, that the credibility of the agent may now be questioned due to the findings in the Report, is "self-serving" and inadequate grounds to justify reconsideration (Docket No. 56, Raymond Atty. Aff. ¶ 14).

DISCUSSION

I. Motion for Reconsideration Standard

The Government seeks reconsideration without stating the procedural basis for that request. As noted by Raymond (Docket No. 56, Raymond Atty. Aff. ¶ 11), the Federal Rules of Criminal Procedure make no provision for reconsideration. As noted by the Government during oral argument, Judge Larimer in another case held that the Magistrate Judge there had the "discretion to reconsider or reopen prior proceedings which precipitated" the Magistrate Judge's decision, United States v. Florack, 155 F.R.D. 49, 51 (W.D.N.Y. 1994). In Florack, the Government sought reconsideration (pursuant to then Federal Rule of Criminal Procedure 12(f)*fn2 by Magistrate Judge Fisher of his refusal to allow the Government to argue an otherwise defaulted suppression motion, id. at 50-51; see id. at 51-52 (Report & Rec. of Fisher, Mag. J.). Judge Siragusa of this Court held in United States v. Amanuel, No. 05CR6075, 2006 WL 266560, at *1 (W.D.N.Y. Jan. 31, 2006), that the civil standard for reconsideration is applicable in criminal cases, that the standard for reconsideration is "strict" and ...


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