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United States v. Scali

United States District Court, S.D. New York

January 18, 2018

UNITED STATES OF AMERICA,
v.
JOSEPH SCALI, Defendant.

          ORDER AND OPINION

          NELSON S. ROMAN UNITED STATES DISTRICT JUDGE.

         Defendant Joseph Scali ("Defendant") is charged in a ten-count indictment with (1) mail fraud in violation of 18 U.S.C. § 1341; (2) structuring to evade currency transaction reports in violation of 31 U.S.C. § 5342(a)(3); (3)-(4) false statements in violation of 18 U.S.C. § 1001; (5) corruptly endeavoring to obstruct and impede the due administration of the Internal Revenue Laws in violation of 26 U.S.C. § 7212(a); (6) tax evasion for the year 2011 in violation of 26 U.S.C. § 7201; (7) tax evasion for the year 2012 in violation of 26 U.S.C. § 7201; (8) obstruction of justice in violation of 18 U.S.C. § 1503; (9) perjury in violation of 18 U.S.C. § 1623; and (10) mail fraud in violation of 18 U.S.C. § 1341. (Superseding Indictment 2 ("S2") ECF Dock. No. 80.) Before the Court is the Government's first motion in limine. (Government's Motion In Limine ("Govt. Mot.") 1, ECF Dock. No. 89.) For the reasons set forth below, the Government's motion is GRANTED in part and DENIED in part

         LEGAL STANDARD

         "A district court's inherent authority to manage the course of its trials encompasses the right to rule on motions in limine." Highland Capital Mgmt., L.P. v. Schneider, 551 F.Supp.2d 173, 176-77 (S.D.N. Y.2008) (citing Luce v. United States, 469 U.S. 38, 41 n. 4 (1984)). An in limine motion is intended "to aid the trial process by enabling the Court to rule in advance of trial on the relevance of certain forecasted evidence, as to issues that are definitely set for trial, without lengthy argument at, or interruption of, the trial.” Palmieri v. Defaria, 88 F.3d 136, 141 (2d Cir.1996). “Because a ruling on a motion in limine is ‘subject to change as the case unfolds, ' this ruling constitutes a preliminary determination in preparation for trial.” United States v. Perez, No. 09-cr-1153 (MEA), 2011 WL 1431985, at *1 (S.D.N.Y. Apr. 12, 2011) (quoting Palmieri, 88 F.3d at 139 (quoting Luce, 469 U.S. at 41, 105 S.Ct. at 163)).

         The Federal Rules of Evidence provide that only relevant evidence is admissible. Fed.R.Evid. 402. Evidence is relevant if “it has any tendency to make a fact more or less probable than it would be without the evidence . . . and the fact is of consequence in determining the action.” Fed.R.Evid. 401 (a)-(b). Relevant evidence may still be excluded by the Court “if its probative value is substantially outweighed by a danger of one or more of the following: unfair prejudice, confusing the issues, misleading the jury, undue delay, wasting time, or needlessly presenting cumulative evidence.” Fed.R.Evid. 403. Though the “standard of relevance established by the Federal Rules of Evidence is not high, ” United States v. Southland Corp., 760 F.2d 1366, 1375 (2d Cir.1985), the Court has “broad discretion to balance probative value against possible prejudice” under Rule 403. United States v. Bermudez, 529 F.3d 158, 161 (2d Cir.2008).

         Evidence may also be admitted as “other act” evidence under Rule 404(b). The Second Circuit adopted an “inclusionary' approach to other acts evidence. United States v. Scott, 677 F.3d 72, 79 (2d Cir. 2012) (citing United States v. LaFlam, 369 F.3d 153, 156 (2d Cir.2004) (per curiam)). Under 404(b), this Court “may admit evidence of prior bad acts if the evidence ‘is relevant to an issue at trial other than the defendant's character, and if the probative value of the evidence is not substantially outweighed by the risk of unfair prejudice.'” United States v. Garcia, 291 F.3d 127, 136 (2d Cir. 2002). The inclusionary rule, however, is not “a carte blanche to admit prejudicial extrinsic act evidence when, as here, it is offered to prove propensity.” Id.

         DISCUSSION

         The Court assumes familiarity with the facts and allegations in this case. See United States v. Scali, 16-CR-466, 2018 WL 369195 (S.D.N.Y. Jan. 9, 2018). The Government raises ten issue in their first motion in limine. The Court takes each in turn.

         I. Evidence relating to the Defendant's Bar Proceedings

         The Government seeks to introduce evidence relating to the suspension and subsequent attempted resignation of the Defendant from the New York State Bar as a combination of both direct evidence of charged offenses and other acts evidence under Rule 404(b). (Govt. Mot. 1, 4.) The Government's request pertains to two sets of evidence. With respect to the first set, they argue that the Court "should permit the Government to call as witnesses the attorneys who handled Scali's disciplinary proceedings before the NY Grievance and SDNY Grievance Committees who will testify about the origin, nature, and the factual bases for the disciplinary proceedings against Scali." (Id. at 10.) The second set of evidence consists of seven "relevant pleadings, filings, and orders filed in the disciplinary proceedings." (Id.) These two sets of evidence are purportedly direct evidence of the obstruction of justice, perjury, and the mail fraud offenses charged in Count Eight, Nine and Ten of the Second Superseding Indictment. (Id. at 10, 13.)[1]

         With respect to the testimony of attorneys who handled Scali's disciplinary proceedings before the New York and S.D.N.Y. Grievance Committees, the Government argues that the witnesses will speak to the origin, nature and the factual bases for the disciplinary proceedings against the Defendant. This testimony will be submitted as direct evidence proving that a statement Defendant made in his affidavit to the S.D.N.Y. District Court was false. (Id. 10-11.) The Defendant faced disciplinary proceedings before the New York Bar after several complaints were filed against him, alleging professional misconduct, including the Defendant's improper use of his Attorney Trust Account, oversight in his law practice and record-keeping, and handling of client matters. (Id. at 4-5.) The Defendant further faced disciplinary actions in the Southern District of New York, during which he was disbarred and subsequently submitted an affidavit (the "Scali Affidavit") claiming that his temporary suspension from the New York Bar had "nothing to do with" his law practice. (Id. 7-8.) Defendant eventually submitted an affidavit in the New York State Appellate Division through which he voluntarily resigned from the New York Bar, and acknowledged his responsibility with regards to specific charges in the underlying disciplinary action. (Id. at 8.)

         The Defendant argues that the testimony of the attorneys who handled the New York disciplinary proceedings is wholly unnecessary. (Def. Response to Govt. Mot. In Limine ("Def. Resp.”) 4-6, ECF Dock. No. 94.) In order to establish that statement made by Defendant in the affidavit to the disciplinary committee was allegedly false, the Government need only to "adduce the subject matter under investigation, nothing more." (Id. at 5.)

         The Government's motion to admit this testimony is granted. The relevancy of attorney's testimony and exhibits relating to the New York and S.D.N.Y. grievance committees is apparent to the obstruction of justice and perjury offenses because they have the tendency to make the allegation of Defendant Scali's alleged false statement more or less probable than it would be without the evidence. The testimony, according to the Government, would prove that the statement made by Scali in his affidavit to the S.D.N.Y. Grievance Committee-that his suspension from the New York Bar for non-cooperation in the investigation that had nothing to do with his law practice-was false. (Govt. Mot. 10.) This is certainly true here, where the testimony will allegedly show that the suspension did in fact have to do with his law practice since the grievance complaints stemmed from various client's complaints.

         Next, the Court determines that the probative value of the testimony is not substantially outweighed by a danger enumerated in Rule 403. While there are situations in which testimony concerning disbarment may be impermissible, this is not one of them. See United States v. D'Auria, 672 F.2d 1085, 1094 (2d Cir. 1982). Any concerns of the jury confusing issues or misleading the jury, would be ameliorated by narrowly tailored testimony and a proper limiting instruction, if the Defendant so requests.

         The Court next turns to the second set of evidence: the pleadings relating to the New York and S.D.N.Y. Grievance Committee proceedings. The Government argues that the exhibits are relevant because they show the nature of the disciplinary proceeding against Scali, and specifically that it pertained to Scali's law practice. They further note that these exhibits are essential to proving that the statement in the Scali Affidavit was false.

         Plaintiff's motion to admit the New York Grievance Petition (Govt. Mot., Exh. 1) and the Amended Petition (Govt. Mot., Exh. 3) (collectively “Petitions”) is granted. The Petitions are relevant to prove that Defendant Scali's disbarment was due to his law practice because the Petitions' contents portray the myriad complaints relating to his law practice. The probative value of the evidence is not substantially outweighed by a danger enumerated in Rule 403. The Petitions are straight forward and unlikely to mislead a jury. Further, the admission of the Petitions is not barred by the rule against hearsay because they are not being admitted for the truth of the matter asserted, but rather, to prove the Defendant's knowledge of the nature of the New York grievance proceedings. (Govt. Mot. 12-13.)

         The motion to admit the Order to Show Cause and Affirmation (Gov. Mot., Exhibit 2) is denied. Although the Government alleges that the exhibit is relevant to show the nature of the proceedings, the Court is unpersuaded. The testimony of at least one attorney and the Petitions are sufficient to establish the nature of the proceedings. There is also a likelihood of confusing the issues and misleading the jury. The Order has facts and references to issues that are not particularly relevant to this case. Further, the operative information of the order-the fact that Defendant Scali had not responded to the Petitions-is evident from the Suspension Order. As a result, it would be imprudent to submit the Order to Show Cause and Affirmation in light of the substantial danger of misleading the jury and confusing the issue.

         The motion to admit Defendant Scali's filings with the Grievance Committee (Gov. Mot., Exh. 4-6) is likewise denied. The filings are relevant to establishing that the New York Grievance proceedings against Defendant Scali did involve his law practice. However, the probative value is substantially outweighed by the danger of confusing the issues. Exhibits 4, 5, and 6 contain Defendant's responses to the New York State Grievance Petitions. Contained therein are his counterarguments and explanations concerning the multiple accusations against him. There is a substantial risk of a Jury fixating on whether or not he committed the underlying acts contained within the Petition, thus diverting attention from the question ...


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