United States v. Pasternak, 18-CR-51 (ENV) (S-3). (2019)
Court: District Court, E.D. New York
Number: infdco20191127g57
Visitors: 10
Filed: Nov. 26, 2019
Latest Update: Nov. 26, 2019
Summary: SHORT-FORM MEMORANDUM & ORDER ERIC N. VITALIANO , District Judge . With jury selection completed on November 25, 2019, trial in this case is scheduled to commence on December 2, 2019. Pasternak and the government have each filed motions in limine. Having heard argument on November 20, 2019, and having considered the parties' submissions, the motions are resolved in the manner and for the reasons set forth below. Request Ruling I. Defe
Summary: SHORT-FORM MEMORANDUM & ORDER ERIC N. VITALIANO , District Judge . With jury selection completed on November 25, 2019, trial in this case is scheduled to commence on December 2, 2019. Pasternak and the government have each filed motions in limine. Having heard argument on November 20, 2019, and having considered the parties' submissions, the motions are resolved in the manner and for the reasons set forth below. Request Ruling I. Defen..
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SHORT-FORM MEMORANDUM & ORDER
ERIC N. VITALIANO, District Judge.
With jury selection completed on November 25, 2019, trial in this case is scheduled to commence on December 2, 2019. Pasternak and the government have each filed motions in limine. Having heard argument on November 20, 2019, and having considered the parties' submissions, the motions are resolved in the manner and for the reasons set forth below.
Request Ruling
I. Defendant's Motions in Limine
(A) Pasternak moves, pursuant to Federal (A) At argument, the government clarified
Rule of Evidence 403, to exclude evidence of that it intends to introduce evidence of faulty
faulty or missing airbags in two of the or missing airbags only as to one vehicle
vehicles purchased from him. Dkt. 104 involved in the fraudulent scheme, and for the
("Def.'s Mot.") at 1. The Indictment charges purpose of showing that the vehicle would not
Pasternak with one count of wire fraud have passed a New York salvage vehicle
conspiracy and four counts of wire fraud, examination because of the condition of the
alleging his involvement in a scheme to airbags. See N.Y. Veh. & Traf. Law § 398fraudulently
obtain Indiana "rebuilt" vehicle d(6)(b), (e). The condition of that vehicle's
titles, certifying the road-worthiness of airbags, therefore, is highly probative of
vehicles that had been repossessed by motive and intent to obtain fraudulent title
insurance companies as total losses and concealing that vehicle's salvage history.
classified by them as "salvage." The In that regard, the non-compliant
indictment further alleges that Pasternak, airbags bear on the materiality of Pasternak's
hiding the salvage history of these and other misrepresentations of the vehicle's fraudulent
vehicles, fraudulently misrepresented to New title. The materiality of Pasternak's alleged
York purchasers that the vehicles had a misstatements is an essential element of the
"clean" non-salvage history. charges. See Dkt. 107 ("Gov't's Resp.") at 1-2;
Zeroing in on the nature of a "salvage see also Neder v. United States, 527 U.S. 1,
examination" that is a condition precedent to 25, 119 S. Ct. 1827, 1841, 144 L. Ed. 2d 35
obtain New York title for the year and type of (1999). To that end, a misstatement is
vehicles that are subject of the indictment, material if it "has a natural tendency to
Pasternak contends the objective is to ensure influence, or is capable of influencing, the
that only non-stolen parts have been used in decision of the decisionmaker to which it was
the rebuilding process, regardless of whether addressed." United States v. Weaver, 860
these parts are safety-related. Def.'s Mot. at 1 F.3d 90, 94 (2d Cir. 2017) (quoting United
& n.1 (citing N.Y. Dep't of Motor Vehicles, States v. Corsey, 723 F.3d 366, 373 (2d Cir.
About the Salvage Vehicle Examination 2013)).
Program, At any rate, except by his own fiat,
https://dmv.ny.gov/registration/about-salvage-vehicle-examination Pasternak makes no showing that evidence of
(last visited Oct. 25, missing or noncompliant air bags, which he
2019)). Seeking to leverage the requirements acknowledged at argument was clearly
of the New York DMV Salvage Vehicle probative under Rule 401, would be any more
Examination, which make no express inflammatory or prejudicial than evidence of
reference to safety, he argues that evidence of any other missing part, including parts that
missing airbags, which bears on the safety of DMV, unlike airbags, treats as safety-related.1
the resold vehicles, would unduly inflame the Any prejudicial effect caused by the proffer of
jury's emotions and distract them from the the airbag evidence, therefore, hardly rises to
true issues of the case. Id. at 2. the level contemplated by Rule 403, as such
evidence is not "`any more sensational or disturbing' than the charged offenses."
United States v. Barrett, 153 F. Supp. 3d 552,
570 (E.D.N.Y. 2015) (quoting United States
v. Reese, 933 F. Supp. 2d 579, 582 (S.D.N.Y.
2013)).
Having failed to show a prejudicial
effect that would substantially outweigh the
probative value of the evidence, Pasternak's
motion is denied.
(B) Defendant moves to exclude any (B) Upon the government's representation
testimony from government witness Michael that it intends to elicit only general "rule-of-Mulcahy,
New York DMV Director of thumb" testimony regarding salvage vehicles,
Compliance, Vehicle Safety and Clean Air, Gov't's Resp. at 3, Pasternak has withdrawn
relating to (1) the discussion of the "market his first objection.
value" of the resold salvage vehicles, Def.'s The second objection, as did the
Mot. at 2, and (2) illegal vehicle sales withdrawn objection, implicates Federal Rule
schemes in general, including that low prices of Evidence 702, which permits an expert
often incentivize quick purchase "without witness to opine on matters within his
asking too many questions." Def.'s Reply at specialized knowledge, training or
2. experience, and, as often expressed, on
matters beyond the ken of the average juror.
United States v. Castillo, 924 F.2d 1227, 1232
(2d Cir. 1991). Expert testimony can,
consequently, provide context to assist the
fact-finder with understanding the total import
of the circumstances that might otherwise be
missed. United States v. Miller, No. 18-cr-202,
2018 WL 5729738 (E.D.N.Y. Nov. 2,
2018). An expert may not, however, under
the guise of his expertise, bolster a fact
witness's version of events as to matters not
in dispute and commonly known or
understood. United States v. Cruz, 981 F.2d
659, 662-63 (2d Cir. 1992).
Concerns about fact bolstering are at
the heart of Pasternak's second objection. He
does not object, though, to Director
Mulcahy's proffered testimony, on the basis
of his professional experience, as to the
relevant terms of art and the operation of the
salvage vehicle market in New York. In this
light, essentially, Pasternak's motion has been
mooted and is denied on that basis, but with
leave to renew at trial should specific
questions put to Director Mulcahy stray
beyond his expertise or into the arena of fact
bolstering. See Andrews v. Metro N.
Commuter R.R., 882 F.2d 705, 708 (2d Cir.
1989).
(C) Defendant seeks to admit evidence from (C) The parties agree that Kelley Blue Book
the Kelley Blue Book as to the values of the information, which lists the typical purchase
vehicles he sold as a hearsay exception under price of vehicles by type and condition,
Federal Rule of Evidence 803(17). Def.'s satisfies an exception to the hearsay rule. See
Mot. at 3. Def.'s Mot. at 3; Gov't's Resp. at 3. The
government, however, seeks to preclude such
evidence under a Rule 401 and 403 analysis,
arguing that specific discussion of the
vehicles' values invites juror confusion that
fair purchase price was a defense to federal
fraud.
While acknowledging that such a
defense would be impermissible, Pasternak
argues that evidence of the vehicles' market
values could be probative of materiality or
somehow could be used to impeach a
purchaser-witness.2 At any rate, in the
absence of any clear direction as to
defendant's actual proffer, the motion is
denied as moot, with leave to either side to
renew at trial.
(D) Pasternak moves to preclude in-court (D) The government does not contest
identifications of him by buyers, if called as Pasternak's motion, which is granted on that
witnesses, who were previously unable to basis.
identify him in photo arrays. Def.'s Mot. at 3.
II. Government's Motions in Limine
(A) The government moves, pursuant to (A) Pasternak does not object to the
Federal Rule of Evidence 404(b), for a ruling introduction of such Rule 404(b) evidence,
as to the admissibility of defendant's prior use provided he reserve the right to object to its
of stickers to alter salvage titles. See Dkt. 103 form and scope. The government's motion,
("Gov't's Mot.") at 3-5. It describes a therefore, is granted to that extent, and subject
previous incident in 2009 in which defendant to Pasternak's right to object to such
registered a vehicle with the New York DMV testimony on any other appropriate ground.
after concealing four "salvage" brands with
bar code stickers. As a result, the Connecticut
salvage title he submitted appeared "clean."
Id. at 3-4. After the DMV discovered the
vehicle was a salvage, defendant purportedly
denied knowledge and claimed he had
purchased the vehicle from a dealer in New
Jersey, despite the sale history reflecting he
purchased it from a dealership he owned. Id.
at 4. The government characterizes this past
act as "nearly identical" to the majority of the
alterations charged in the Superseding
Indictment, which also involved his covering
salvage history brands on vehicle titles with
"official-looking bar code stickers." Id. The
government argues evidence of this prior
incident is highly relevant to defendant's
identity, knowledge and intent. Id.
(B) The government moves, pursuant to (B) Pasternak objects only to the DMV
Federal Rules of Evidence 901(b)(2)3 and 701 investigator testifying that he became familiar
for a ruling on the admissibility of a DMV with Pasternak's handwriting over the course
senior investigator's identification of of a "years-long" investigation, arguing the
Pasternak's handwriting. Not seeking to time frame of the investigation risks unfair
qualify him as an expert witness, the prejudice. Dkt. 108 ("Def.'s Resp.") at 1.
government proffers that the investigator The government has agreed it will not
became familiar with Pasternak's handwriting introduce evidence as to the time frame of the
over the course of his years-long investigation. Dkt. 110 ("Gov't's Reply") at
investigation, and not, as Rule 901(b)(2) 1. Accordingly, the government's motion is
prohibits, for purposes of the current granted on the basis of that understanding.
litigation. See Gov't's Mot. at 5-6.
(C) Contending that neither victim reliance (C) The government is correct that the federal
nor victim negligence is an element of or an criminal fraud statutes do not require reliance
affirmative defense to fraud under federal as an element. Weaver, 860 F.3d at 95.
law, the government moves, as confusing and Testimony as to Pasternak's statements,
nonprobative, to preclude argument that "any misstatements, or omissions is clearly
of [defendant's] victims should have known relevant and highly material, since they are
of the vehicles' salvage history . . . or that any foundational to their "natural tendency to
victims did not in fact rely on his fraudulent influence" the buyer. Id. at 94 (quoting
misstatements." Gov't's Mot. at 7. United States v. Corsey, 723 F.3d 366, 373
(2d Cir. 2013)). But, that is a far cry from
evidence or argument as to the specific impact
such representations had on a specific victim
of a fraudulent sale.
Pared to the core the question is
whether, objectively, a reasonable buyer
would have considered misrepresentations of
a vehicle's salvage history an important
purchase factor. See id. at 94, 96; United
States v. Isola, 548 F. App'x 723, 725 (2d Cir.
2013).
Because testimony or argument about
the reliance (or lack thereof) of a specific
buyer of a specific Pasternak vehicle is
irrelevant, highly prejudicial and likely
confusing to the jury, the government's
motion is granted. Testimony, either on direct
or cross, as to the specific impact of
Pasternak's conduct on a specific purchaser,
is precluded.
(D) The government moves to exclude any (D) In his response, Pasternak argues that it
evidence that defendant was sometimes was his "business practice to discuss his cars'
truthful with his customers on the ground that salvage histories with buyers," such that
such evidence is not relevant to whether he testimony to that effect is admissible under
otherwise engaged in fraud in the charged Federal Rule of Evidence 406. Dressed in
offenses. Id. at 9. business attire, this is simply a repackaged
"Willie Sutton regularly walked past banks
without robbing them" argument. Not even
the most generous reading of Rule 406 or
courts' interpretation of that Rule can come
close to supporting Pasternak's position.
However, Pasternak represented at
oral argument that he may call certain
purchasers of vehicles whose titles the
government will proffer were fraudulent, and
also, as to almost all, fraudulently obtained, to
testify that, notwithstanding the fraudulent or
fraudulently obtained title, Pasternak
disclosed their salvage history prior to sale.
Such testimony is admissible to rebut the
charge of fraud as to those vehicles. Cf.
Neder, 527 U.S. at 24 (holding that a
deception is an element of federal mail fraud).
In short, such testimony would be offered to
show that, as to that sale, there was no
deception.
Testimony by such purchasers of
specific vehicles, the title of which the
government intends to introduce at trial,
would be permissible. With respect to such
testimony, the government's motion is denied
but is otherwise granted.
(E) The government moves to preclude the (E) In essence, Pasternak seeks to call an
testimony of defense witness Erica L. expert witness, as his counsel further
Eversman proffered as to the marketing of explained at oral argument, to put the national
salvage and rebuilt vehicles, arguing that, vehicle "title washing" industry on trial. The
even if she is qualified to testify as an expert expert would do some sort of comparative
in that field, her intended testimony is either analysis of vehicle title practices among the
irrelevant or is likely to confuse the jury and states and demonstrate how used vehicle
should be excluded under a Rule 401-403 marketers could legally leverage differences
analysis. Gov't's Mot. at 9-10. among the states to maximize the purchase
price paid by the retail buyer. In the spotlight
of her testimony would be title practices
regarding salvage or rebuilt vehicles.
Although some of such testimony would
likely be relevant in this case, the vast
majority of the testimony as scoped out by
Pasternak would not.
The title washing industry is not on
trial in this case. Nor is Eversman's opinion
as to the various ways a used car marketer
could leverage the title practice differences
among the states legally relevant to the case
on trial here. All that is on trial is whether
Pasternak engaged in a scheme to
misrepresent the title history of vehicles and
thereby defraud retail purchasers.
As previewed, the government intends
to offer proof that Pasternak joined a
conspiracy which obtained fraudulent
"rebuilt" vehicle titles in Indiana. It also
intends to prove that Pasternak then marketed
the vehicles with fraudulent Indiana title and,
further, fraudulently obscured indicia on the
fraudulent title indicating that the vehicle was
rebuilt, a term that would encompass vehicles
defined as "salvage" in New York.
Additionally, the government claims it will
show that, in at least one instance, Pasternak
marketed a vehicle with legitimately obtained
New Jersey title with rebuilt indicia and
altered that indicia to obscure the fact that the
vehicle was a salvage vehicle. With that
understanding, the government is correct that
the broad testimony of Eversman as to the
conduct of the national title washing industry
would, to the extent relevant at all, be
thoroughly confusing of the issues properly
before the jury.
The fraud the government charges is
limited to the marketing of vehicles
repossessed by insurance companies
following an insurance loss, such as collision
or flood. Expert testimony as to how honest
title could be obtained to market such vehicles
as road-ready would be helpful and
admissible under Rule 702. But, within the
confines of the counts charged in the
indictment and the proof the government
intends to offer, such expert testimony, to be
relevant and non-confusing to the jury, would
be limited to the requirements of the states of
Indiana, New Jersey and New York. Just as
the government will be permitted to offer
witnesses with special expertise in this field
to testify in that regard, so too would
Pasternak be permitted to call Eversman as
his expert in the field to offer testimony
limited to this same subject area.
Accordingly, to that extent, the
government's motion in limine restricting the
testimony of Eversman is granted. Of course,
should the testimony stray into other areas
opening the door to more expansive testimony
by Eversman, Pasternak may renew his
request at that time. But, at this time, expert
testimony will be limited to the titling of
"salvage" vehicles, that is, vehicles
repossessed by insurance companies as total
losses, in the states of Indiana, New Jersey
and New York, and the manner in which such
vehicles could then be titled as road-ready in
New York.
So Ordered.
FootNotes
1. Pasternak's argument, viewed holistically, is somewhat mystifying. He points out that, in New York, a vehicle without air bags will pass a safety inspection. Dkt. 109 ("Def.'s Reply") at 1 (citing N.Y. Comp. Codes R. & Regs. tit. 15, § 79.21). He offers the observation to establish that, because an absent or noncompliant air bag will cause a vehicle to flunk the salvage examination, its natural association with safety may carry a prejudicial effect that substantially outweighs its probative value. But, the observation establishes, at the same time, that the airbag is not regulated as a "safety" feature, much less one the absence of which would undermine a vehicle's road-worthiness.
2. But, defendant did concede at oral argument that, pursuant to Federal Rule of Evidence 608(b), he may not introduce the Kelley Blue Book as extrinsic evidence to impeach a witness about specific instances of his or her conduct in conjunction with the purchase.
3. The government's motion references Rule 902, but it is clear from context it grounds its motion in Rule 901.
Source: Leagle
