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United States of America v. William C. Lange

February 15, 2012

UNITED STATES OF AMERICA,
v.
WILLIAM C. LANGE, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Dora L. Irizarry, United States District Judge:

MEMORANDUM AND ORDER

The instant action arises out of a multi-defendant indictment alleging the defendants executed a fraudulent advance-fee scheme (the "HFGI Scheme"), related to financing for home builders, and a scheme to fraudulently induce investors (the "BSMI Scheme") to invest in Black Sand Mine, Inc. ("BSMI"), a Washington State corporation. In connection with the HFGI Scheme, defendant William C. Lange ("Defendant") is charged with one count ("Count One") of conspiracy to commit wire fraud, in violation of 18 U.S.C. §§ 1343 and 1349. In connection with the BMSI Scheme, Defendant is charged with one count ("Count Two") of conspiracy to commit securities and wire fraud, in violation of 15 U.S.C. §§ 78j(b) and 78ff, 18 U.S.C. § 371, and 18 U.S.C. § 1343, and one count ("Count Three") of securities fraud, in violation of 15 U.S.C. §§ 78j(b) and 78ff and 18 U.S.C. § 2.

Defendant now moves to: 1) dismiss the action for improper venue; 2) compel certain discovery; 3) compel pre-trial discovery of Brady material; and 4) sever Count One of the indictment from the remaining counts.*fn1 (See generally Doc. Entry Nos. 47-52.) The government opposes Defendant's motions in their entirety. (See generally Doc. Entry No. 73, Gov't Opp.) For the reasons set forth below, Defendant's motions are denied.

DISCUSSION

I.Venue

Defendant first alleges that venue in the Eastern District of New York ("EDNY") is improper because neither the Superseding Indictment ("SI") nor the discovery provided to Defendant establish a basis for venue and that the government has not otherwise articulated why venue is proper in the EDNY. Accordingly, Defendant asserts the SI should be dismissed and that the defendants should be discharged. (Doc. Entry No. 47, Def. Mot. to Dismiss at 3-4.) Defendant's arguments are premised on a misapprehension of the applicable law.

When a defendant challenges venue by way of a pre-trial motion to dismiss the indictment, "the government need only show that the indictment alleges facts sufficient to support venue." United States v. Gonzalez, 2011 WL 1405111, at *1 (E.D.N.Y. Mar. 23, 2011) (citing cases). Moreover, when a court considers a motion to dismiss the indictment, all of the allegations contained in the indictment must be accepted as true. See United States v. Goldberg, 756 F. 2d 949, 950 (2d Cir. 1985). Further, as Defendant concedes, (Doc. Entry No. 74, Def. Reply Brief at 1), an "indictment, alleging on its face that the offenses occurred 'within the Eastern District of New York and elsewhere,' suffices to sustain it against [a] pretrial attack on venue." United States v. Bellomo, 263 F. Supp. 2d 561, 579 (E.D.N.Y. 2003). Here, each count of the SI alleges the criminal activity occurred "within the Eastern District of New York and elsewhere." (SI ¶¶ 12, 14, 17.) Accordingly, for purposes of this pre-trial motion, the government has sustained its burden and Defendant's motion is denied.

While Defendant acknowledges the holdings of Bellomo and Goldberg he nonetheless argues they are "inconsistent with the constitutional magnitude of the venue issue[.]" (Def. Reply Brief at 1.) Despite Defendant's constitutional concerns, Defendant has failed to address the allegation that individuals who reside in the EDNY were victims of Defendant's alleged criminal activity. Surely this district has an interest, and venue is therefore proper, when it is alleged that residents of the EDNY were harmed by Defendant's alleged criminal activity. Accordingly, Defendant's constitutional argument is unavailing. Defendant is free to renew the motion to dismiss on venue grounds after the government's case in chief and again, if necessary, at the end of the entire case.

II.Rule 16 Discovery

Second, Defendant moves, pursuant to Federal Rule of Criminal Procedure 16 ("Rule 16"), to compel the government to allow inspection and copying of communications between the government and a variety of individuals and law enforcement reports prepared as part of the investigation of this case. (See Doc. Entry No. 48, Mot. to Compel at 1.) The government argues the requests are fishing expeditions and that the communications and reports requested are otherwise not yet discoverable under the Jencks Act, 18 U.S.C. § 3500. (Gov't Opp. at 9.)

Defendant first seeks discovery of communications between employees of the government and attorneys representing alleged victims in civil suits against Defendant and his companies. He alleges these items are material to the presentation of his defense in that they may demonstrate bias and motives to fabricate on the part of witnesses for the government. (Mot. to Compel at 1-2.) Defendant's request is premature. The request for production of statements from potential witnesses "implicate[s] the Jencks Act, 18 U.S.C. § 3500, which provides that no prior statement made by a government witness [or prospective government witness] shall be the subject of discovery until that witness has testified on direct examination." United States v. Coppa, 267 F. 3d 132, 145 (2d Cir. 2001).

Defendant next seeks discovery of communications between the government or its agents, and Roger Campagnola, now deceased, or his legal representatives. Defendant alleges these items are material to the presentation of his defense in that the items may contain information about possible witnesses for the defense. (Mot. to Compel at 1-2.)

In the context of Rule 16, an item is "material" if it "could be used to counter the government's case or to bolster a defense." United States v. Stevens, 985 F. 2d 1175, 1180 (2d Cir. 1993) (internal citations omitted). Defendant has the burden to show the items sought are material to preparing his defense. United States v. Giffen, 379 F. Supp. 2d 337, 342 (S.D.N.Y. 2004) (citation omitted). "[C]onclusory allegations" are "insufficient for this purpose." Id.

The court finds Defendant's conclusory allegation that the communications may contain information about possible witnesses insufficient to show the materiality of the communications to the presentation of his defense. To the extent the government agents'/investigators' communications constitute reports or internal government documents; they are not discoverable under Rule 16 (see below). Accordingly, Defendant's request is denied without prejudice. To the extent Defendant can show the materiality of his request with more ...


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