Opinion
S2-01 Cr.571 (JGK)
July 9, 2002
OPINION AND ORDER
On June 6, 2002, the defendant, Christian T. Viertel, was charged in a Second Superseding Indictment with one cQunt of conspiring to commit wire fraud and mail fraud in violation of 18 U.S.C. § 371 (Count Two); one substantive count of wire fraud in violation of 18 U.S.C. § 1343, 1346 and 2 (Count Seven); and one substantive count of mail fraud in violation of 18 U.S.C. § 1341, 1346 and 2 (Count Eight). The Second Superseding Indictment also alleged that another defendant, John C. Lee, had engaged in a separate conspiracy to commit wire fraud and mail fraud and had committed a number of substantive offenses of wire fraud and mail fraud. Each of the offenses against Viertel were charged in counts that were separate from the counts against Lee. All of the counts related to an alleged scheme whereby Fritz Blumenerg, the President of Burda Media, Inc. ("Burda"), obtained funds from Burda Holding Company, the parent of Burda Media, to which Blumenberg was allegedly not entitled.
On July 3, 2002, the government filed a nolle prosegul with respect to Lee, dismissing all of the charges against him. Before filing this nolle prosepui, Lee and Viertel had made a number of motions, which are still currently pending. The motions were originally made in connection with the First Superseding Indictment, which had charged a single conspiracy in which Blumenberg, Lee and Viertel allegedly participated, and charged Blumenberg, Lee and Viertel in the same wire fraud and mail fraud counts. After the motions were filed, the government filed the Second Superseding Indictment, which charged Lee and Viertel with separate conspiracies involving Blumenberg, charged separate wire fraud and mail fraud counts against Lee and Viertel, and no longer named Blumenberg as a defendant because he had already pleaded guilty to the charges in the First Superseding Indictment.
The defendants Lee and Viertel have moved (i) to sever their respective trials under Rules 8(b) and 14 of the Federal Rules of Criminal Procedure, (ii) to compel production of a bill of particulars, along with the government's exhibit list, pursuant to Rule 7(f) of the Federal Rules of Criminal Procedure; (iii) to compel production of any evidence favorable to them that is material to guilt or punishment under Brady v. Maryland, 373 U.S. 83 (1963), and to direct the government to comply with its Rule 16 discovery obligations, (iv) to dismiss those portions of the charges against the defendants that alleged a scheme to deprive another of the intangible right of honest services, as opposed to a scheme to obtain money or property; and (v) to dismiss the conspiracy count in the First Superseding Indictment, which alleged a single overarching conspiracy among Blumenberg, Lee and Viertel, as duplicitous because this count allegedly charged two distinct conspiracies in one count, the first conspiracy involving Blumenberg and Lee and the second one involving Blumenberg and Viertel. Lee also moved independently (vi) to dismiss the First Superseding Indictment, or, in the alternative, to inspect the grand jury minutes and for for an order striking certain allegedly inflammatory language in that Indictment relating to Lee.
After the government filed the Second Superseding Indictment, the defendants indicated that the motions should be directed to the new Indictment insofar as the motions were still applicable. Lee also filed (vii) a motion to dismiss all of the charges against him in the Second Superseding Indictment because they were allegedly time-barred and to strike certain language in the Second Superseding Indictment because it was allegedly prejudicial to him. Viertel has indicated that he does not join the statute of limitations arguments directed to the substantive counts of wire fraud and mail fraud, although he does contend that the conspiracy charged in the Second Superseding Indictment is barred by the statute of limitations.
All of the motions by Lee are denied as moot, with respect to Lee, in light of the government's filing of a nolle prosequi with regard to him. The motion to sever is denied as moot because there is only one remaining defendant to be tried, and the motion to dismiss count one of the First Superseding Indictment is denied as moot in light of the government's filing of the Second Superseding Indictment, which does not allege a single conspiracy involving Blumenberg, Lee and Viertel. The other motions on behalf of Viertel are still pending.
I.
Unless otherwise indicated, the following facts are either undisputed or are matters of public record.
A.
On June 14, 2001, the Original Indictment was filed. That Indictment alleged that from in or about 1992 up to and including in or about July 1996, Blumenberg, Lee and Viertel conspired to commit wire fraud and mail fraud by obtaining funds from Burda Holding for the benefit of Fritz Blumenberg to which he was not entitled. Ind. ¶¶ 1-8. The Original Indictment also charged one substantive count of wire fraud and one substantive count of mail fraud, both of which allegedly involved all three defendants and lasted for the same time period. Ind. ¶¶ 9-12.
According to the Indictment, Blumenberg was the president of Burda for the entire time period relevant to the charges in the Indictment. Ind. ¶ 1. Burda was a media company located in New York, New York, Ind. ¶ 1, which contracted with numerous outside vendors to obtain services to assist with its news gathering operations. After the work was performed, these vendors would submit invoices to Burda seeking payment, and Burda would issue checks to cover the invoices from its bank accounts at Chase Manhattan Bank in New York, New York or would pay the vendors with cash. md. ¶ 2. Lee was the owner and chief executive of one of these outside vendors, namely, Hot Line Delivery, Inc. ("Hotline"). Viertel was the owner of another such vendor, Agate Reality, as well as a number of other companies that submitted invoices to Burda during the relevant time period (collectively, the "Viertel Companies"). Ind. ¶¶ 3, 7(d).
Whenever Burda's bank accounts fell below a certain level due to the payment of invoices, Burda Holding would replenish Burda's accounts. Ind. ¶ 2. Burda Holding is a German limited partnership with its principal place of business in Munich, Germany and its offices in of fenburg, Germany. Ind. ¶ 1. Burda Holding would allegedly replenish Burda's accounts approximately twice a month by having money wired from its bank account at Dresdner Bank in of fenburg, Germany to Burda's accounts at Chase Manhattan Bank. Ind. ¶ 2. .At the end of each month, Burda would send Burda Holding the original invoices via an international freight company. Id.
The Original Indictment alleged three main means and methods of carrying out the alleged conspiracy to defraud. First, Blumenberg allegedly created a number of fraudulent invoices purporting to be from a company called Best Messenger-In-Town, Inc., which had in fact ceased doing business in 1981 and had stopped performing services for Burda at that time. Blumenberg would then use the phony invoices to obtain checks from Burda payable to cash and to obtain the money for hirhself. Ind. ¶ 7(a). Second, Lee allegedly caused Hothne to submit a number of invoices to Burda for services Hothne purportedly rendered to Burda but which in fact represented services performed for Blumenberg's personal benefit. Ind. ¶ 7(b). Third, on various occasions, Viertel allegedly caused Agate Reality and a number of the other Viertel Companies to submit invoices to Burda for services purportedly performed for Burda but which were in fact performed for Blumenberg's personal benefit or for services not performed at all. Ind. ¶ 7(c).
The conspiracy count in the Original Indictment identified a number of specific invoices in the overt acts section that were allegedly submitted by Viertel to Blumenberg, a number by Lee to Blumenberg, and a number by Blumenberg to Burda, along with specific dates and the amounts of the alleged invoices. The invoices that were specified as overt acts were all allegedly submitted between June 17, 1996 and July 1, 1996. Ind. ¶¶ 8(a)-(k). The conspiracy count also charged in its overt acts section that Burda Holding wired $350,000 to Burda on June 24, 1996 and on two other occasions, and that Burda sent Burda Holding the allegedly fraudulent invoices from the month of June via international commercial carrier on or about June 28, 1996. Ind. ¶ 8(1)-(o). The substantive counts of wire fraud and mail fraud did not identify the specific use of the wires or mails that allegedly formed the jurisdictional bases for the counts, but the counts diti incorporate by reference the relevant allegations from the conspiracy charge, which identified a specific mailing and three specific uses of the wires. See Ind. ¶¶ 9-12.
B.
On February 14, 2002, the First Superseding Indictment was filed. That Indictment charged substantially the same offenses as the Original Indictment, except that it added two tax-related charges against Blumenberg for subscribing to and filing false tax returns that failed to report the wages that he received from Burda and failed to report the value of the money, goods and services he allegedly received as part of the alleged conspiracy with Viertel and Lee. See S1 Ind. ¶¶ 13-18. On April 5, 2002, Blumenberg pleaded guilty to all of the counts in the First Superseding Indictment.
C.
Thereafter, Viertel and Lee filed their initial motions, as described above, including their motion to dismiss the original conspiracy count as duplicitous because it allegedly charged two distinct conspiracies in the same count, one involving Blumenberg and Lee and one involving Blumenberg and Viertel. On June 6, 2002, while the parties were briefing these motions, the Second Superseding Indictment was filed. That Indictment charged substantially the same charges against Wiertel as the First Supefseding Indictment except that it separated the conspiracies that the defendants had argued were distinct as alleged in Count One of the First Superseding Indictment and charged Viertel with a conspiracy that was narrower in scope and involved only the invoices from the Viertel Companies and only the overt acts relating to Viertel's and Blumenberg's conduct in connection with those invoices. Compare S2 Ind. ¶¶ 17-21 ("The Viertel Conspiracy"), with, S2 Ind. ¶¶ 13-16 ("The Lee Conspiracy"); see also S2 Ind. ¶¶ 1-12. The substantive counts were also revised to separate the counts of wire fraud and mail fraud against Lee from those against Viertel and to make each use of the wires and mails a separate offense. In particular, Count Seven, which is the single wire fraud count against Viertel, now identifjes the June 24, 1996 use of the wires that was alleged in he Original Indictment, and Count Eight, the single mail fraud count against Viertel, identifies the June 28, 1996 mailing from the Original Indictment. After this Second Superseding Indictment was filed, Lee filed his reply brief on his original motions, and, in it, he argued that all of the new charges against him were time-barred because they were filed more than five years after the conduct alleged and because they materially broadened the charges against him from the Original Indictment.
On June 21, 2002, the Court heard oral argument on the pending motions, and the defendants indicated that their motions to dismiss should be applied to the charges raised in the Second Superseding Indictment, where applicable. The Court also allowed the parties to brief the statute of limitations issue that had been raised in Lee's reply brief. During this second round of briefing, Lee raised additional statute of limitations arguments directed at the substantive counts alleged against him. At oral argument on these statute of limitations motions, Viertel indicated that he did not join these statute of limitations arguments as directed against the substantive counts against him, thus indicating that his only statute of limitations argument relates to the conpiracy charge against him. See Tr. dated 7/1/02 at 30-32.
On July 3, 2002, the government entered a nolle prosegui with regard to Lee, dismmissing all of the charges against him.
III.
Viertel argues that the conspiracy charged against him in the Second Superseding Indictment is time-barred. Conspiracies to commit wire fraud and mail fraud are subject to the five-year statute of limitations set forth in 18 U.S.C. § 3282. Where, as here, a conspiracy charge requires proof of overt acts, the conspiracy must generally meet two criteria to be timely: (1) "the . . . conspiracy must still have been ongoing within the five year period preceding the indictment, and 72) 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) (internal quotation marks and alterations omitted) (citing Grunewald v. United States, 353 U.S. 391, 396-97 (1957) ("[T]he crucial question in determining whether the statute of limitations has run is the scope of the conspiratorial agreement, for it is that which determines both the duration of the conspiracy, and whether the act relied on as an overt act may properly be regarded as in furtherance of the conspiracy.")).
The Original Indictment, which was filed on June 14, 2001, alleged a single overarching conspiracy among Blumenberg, Viertel and Lee, which continued through in or about July 1996 and alleged a number of overt acts in furtherance of the conspiracy on or after June 17, 1996, and, hence, within the relevant five-year time period. However, the Second Superseding Indictment was filed on June 6, 2002, and the more limited conspiracy alleged between Blumenberg and Viertel is still alleged to have continued only to in or about July 1996, which is more than five years before this Indictment was filed. The charge would be timely only if it related back to the filing of the Original Indictment.
The filing of an indictment generally tolls the limitations period for the charges contained in that indidtment. See United States v. Grady, 544 F.2d 598, 601 (2d Cir. 1976). Hence, a superseding indictment will be said to "relate back" to the date of any validly pending indictment, and thereby obtain the benefit of its filing date, if the superseding indictment does not "broaden or substantially amend the original charges." United States v. Grady, 808 F.2d 1, 3 (2d Cir. 1986); see also Grady, 544 F.2d at 601-02. "In deciding whether a superseding indictment substantially changes the original charges," the Court of Appeals for the Second Circuit has held that "notice is the touchstone," and that a "timely, pending indictment serves this doctrine by apprising a defendant "that he will be called to account for his activities and should prepare a defense.'" Genoo, 808 F.2d at 3 (quoting Grady, 544 F.2d at 601 (alteration marks omitted)). For these reasons, "[sbuperseding indictments have been deemed timely when they simply added detail to the original charges, narrowed rather than broadened the charges, contained amendments as to form but not substance, or were otherwise trivial or innocuous." United States v. Ben Zvi, 168 F.3d 49, 54 (2d Cir. 1999) [hereinafter Ben Zvi].
The critical issue with regard to this motion is whether the new conspiracy charge against Viertel broadens the conspiracy charge against him, as he argues, or rather narrows it, as the government argues. In Ben Zvi, the Court of Appeals found that the addition of sixteen counts of money laundexung to a previously charged scheme to defraud did not relate back to the earlier-filed indictment. The Court of Appeals noted that the additional counts alleged by the "superseding indictment required the defendants to defend against additional charges that alleged violations of a different statute, contained different elements, relied on different evidence, and exposed the defendants to a potentially much greater sentence." Ben Zvi, 168 F.3d at 55.
Using notice as the touchstone and applying the factors that the Court of Appeals found significant in Ben Zvi, the conspiracy alleged in the Second Superseding Indictment relates back to the filing of the Original Indictment. The Second Superseding Indictment charges Viertel under the very same conspiracy statute as in the Original Indictment with a conspiracy to violate the yery same wire fraud and mail fraud statutes as in the Original Indictment. The elements of the conspiracy charges are identical, as are the elements of the underlying substantive violations, and neither the government nor the defendant will need to rely on any new or additional evidence with respect to the new conspiracy charge. The conspiracy charge against Viertel in the Second Superseding Indictment also narrowed the participants in the alleged conspiracy by eliminating Lee as a defendant. Moreover, by splitting the original conspiracy charge into two smaller conspiracies, each "of which allegedly encompasses a smaller subsection of the overt acts alleged in the Original Indictment, the Second Superseding Indictment exposed the defendant to the same maximum sentence as the Original Indictment but narrowed the relevant conduct for which Viertel is potentially liable at sentencing. See U.S.S.G. § 1B1.3(a)(1)(B). In these circumstances, the Original Indictment adequately apprised Viertel that he would be called to account for all of the activities alleged as part of the conspiracy charge in the Second Superseding Indictment and that he should prepare a defense. Finally, to the extent that the Second Superseding Indictment has eliminated the possibility of a multiple conspiracy defense, this kind of amendment is closely analogous to the amendment of an indictment to charge a lesser included offense, and such amendments have been held to fall within the relation back doctrine and to narrow the charges against a defendant. See, e.g., United States v. Gerstner, 548 F. Supp. 348, 349 (S.D.N.Y. 1982); see also United States v. Calderone, 982 F.2d 42, 48 (2d Cir. 1992). Under the factors outlined in Ben Zvi, and given the adequate notice provided by the Original Indictment, the Second Superseding Indictment narrowed the conspiracy charge against Viertel.
Further support for the proposition that the Second Superseding Indictment narrowed the conspiracy charge against Viertel can be found in the double jeopardy cases in this Circuit, particularly as they apply to conspiracy charges. See generally Calderotie, 982 F.2d at 44-47; United States v. Korfant, 771 F.2d 660, 662-63 (2d Cir. 1985) (per curiam). The double jeopardy cases have been used to explain whether a charge in a superseding indictment relates back to a charge in an earlier indictment. See oenerally United States v. Gicrante, 982 F. Supp. 140, 155-58 (E.D.N.Y. 1997), aff'd, 166 F.3d 75 (2d Cir. 1999). The Court of Appeals for the Second Circuit has found that it would violate the Double Jeopardy Clause to indict a defendant on a smaller conspiracy that is wholly contained in a larger one after the defendant was acquitted on the larger conspiracy charge. According to the Court of Appeals:
the second conspiracy is simply a small component of the prior larger conspiracy. This is not technically an instance of a lesser included offense, because the larger conspiracy does not require proof Qf a discrete element not required for proof of the smaller conspiracy. But the essential factors identifying the scope of the smaller conspiracy are all "lesser included" within the larger conspiracy.
Calderone, 982 F.2d at 48. This treatment of the smaller conspiracy charge as a narrower conspiracy and as analogous to a lesser included offense for double jeopardy purposes supports the conclusion that the smaller conspiracy charged against Viertel in the Second Superseding Indictment should be treated as a charge that narrows the charge against him in the Original Indictment.
In sum, the conspiracy charge alleged against Viertel in the Second Superseding Indictment is not barred by the relevant statute of limitations.
IV. A.
Viertel moves to dismiss those portions of the charges against him that allege schemes to deprive another of the intangible right of honest services. The schemes to defraud that are alleged in each of the counts are schemes to obtain money and property by means of false and fraudulent representations and promises, and "to deprive another of the intangible right of honest services." S2 Ind. ¶¶ 19-20, 26-29. Section 1346 of Title 18, United States Code, provides that the term "scheme or artifice to defraud" as used in the mail and wire fraud statutes includes "a scheme or artifice to deprive another of the intangible right of honest services." 18 U.S.C. § 1346. Congress passed this provision in 1988 in response to the Supreme Court's decision in McNally v. United States, 483 U.S. 350 (1987), which had held that the plain language of the mail and wire statutes that were applicable at the time did not allow for criminal convictions for such schemes. The Supreme Court concluded that schemes to deprive another of the intangible right of honest services were not prohibited, unless Congress explicitly criminalized such conduct. See id. at 360 ("If Congress desires to go further, it must speak more clearly than it has."). Congress subsequently passed § 1346.
Viertel argues that § 1346 is unconstitutionally vague as applied to the conduct charged against him in this case. "As generally stated, the void-for-vagueness doctrine requires [1] that a penal statute define the criminal offense with sufficient definiteness that ordinary people can understand what conduct is prohibited and [2] in a manner that does not encourage arbitrary and discriminatory enforcement." Kolender v. Lawson, 461 U.S. 352, 357 (1983) (collecting cases). Where, as here, there is a vagueness challenge to a statute that does not involve First Amendment freedoms, the statute must be evaluated "in light of the facts of the case and on an as-applied basis." United States v. Whittaker, 999 F.2d 38, 42 (2d Cir. 1993) . In support of his void-for-vagueness argument, Viertel relies on United States v. Handakas, 286 F.3d 92 (2d Cir. 2002), in which the Court of Appeals for the Second Circuit found that § 1346 was unconstitutionally vague as applied to a conviction in which the sole basis for the alleged intangible right of honest services was based on a contract. Id. at 107.
Before Handakas was decided, the Court of Appeals had sustained a number of convictions based on § 1346 where defendants had devised or intended to devise a scheme or artifice to deprive an employer or principal of the intangible right of honest services of an employee or agent, in circumstances where the actionable duty arose from tort, rather than contract. See United States v. Middlemiss, 217 F.3d 112, 119-20 (2d Cir. 2000) (upholding conviction for mail fraud involving a scheme that deprived the defendant's employer of "all the services that a totally faithful employee would have provided" and in. furtherance of which the defendant acted contrary to the best interests of his employer); United States v. Sancho, 157 F.3d 918 (2d Cir. 1998) (per curiam) (upholding conviction for wire fraud, where the defendant agreed to pay an undercover agent who the defendant believed was a consultant for a company to give false information to the company and to refrain from disclosing any conflict of interest). The Court in Handakas acknowledged and reaffirmed the validity of these earlier cases, stating that "[t]ogether . . . Sancho and Middlemiss appear to stand for the proposition that a scheme to harm another by the breach of a duty enforceable by an action in tort may support a conviction for a scheme to defraud another of "honest services.'" Handakas, 286 F.3d at 106. Since Handakas, the Court of Appeals has similarly reaffirmed this basic principle, stating that "[a]s Handakas itself observed, we are bound by this court's precedents upholding convictions under § 1346 that involved schemes, like the one at issue here, in which the defendant breached or induced the breach of a duty owed by an employee or agent to his employer or principal that was enforceable by an action at tort." United States v. Rybicki, 287 F.3d 257, 264 (2d Cir. 2002); see also United States v. Szur, 289 F.3d 200, 209 n. 5 (2d Cir. 2002).
In this case, the government alleges that Blumenberg was the president of Burda, and argues that he therefore owed a fiduciary duty to his company as its employee and agent. This duty is enforceable by an action in tort and is not limited to any contract. The government argues that Viertel devised or intended to devise a scheme to deprive Burda of the intangible right to Blumenberg's honest services by engaging in a scheme with Blumenberg involving breaches of fiduciary duty and other duties owed by Blumenberg to Burda as its President. The holding in Handakas is therefore inapplicable to this case, and the charges alleged fall squarely within the ambit of Sancho, Middlemiss, Rybicki, and Szur.
While a fiduciary duty is involved in this case, the Court of Appeals has held that a fiduciary duty is not an essential element under § 1346. See Sancho, 157 F.3d at 919, 921.
Viertel argues that the holdings in Sancho, Middlemiss, RVbicki and Szur do not undermine his void-for-vagueness argument because the alleged conduct that gave rise to the purported criminal liability in this case all allegedly ended in or about July 1996, before any of these cases had been decided. However, "it is immaterial [to a void for vagueness analysis] that there is no litigated fact pattern precisely on point, " so long as ordinary people can understand that the conduct in question is prohibited and the language of the statute does not encoufage arbitrary and discriminatory prosecutions. United States v. Ingredient Tech. Corp., 698 F.2d 88, 96 (2d Cir. 1983) (internal quotation marks omitted); see also United States v. Kinzler, 55 F.3d 70, 74 (2d Cir. 1995). An ordinary person would understand that employees owe duties to their employers, that these duties consists in part in a relation of trust that includes a duty of honesty and loyalty and a duty to disclose conflicts, and that inducing or assisting an employee to breach those duties by stealing funds that belong to the company is prohibited. See generally Batas v. The Prudential Ins. Co., 724 N.Y.S.2d 3, 7 (App.Div. 2001); see also generally The Fund of Funds, Ltd. v. Arthur Andersen Co., 545 F. Supp. 1314, 1350-60 (S.D.N.Y. 1982) (duty to disclose was part of common law professional fiduciary duties); Maritime Fish Prod., Inc. v. World-Wide Fish Prods., Inc., 474 N.Y.S.2d 281, 285 (App.Div. 1984) (an agent or employee must at all times exercise the utmost good faith and loyalty toward his principal in the performance of his duties and must account to his principal for secret profits). Hence, the Sancho, Middlemiss, Rybicki and Szur cases were not needed for an ordinary person to understand that it would deprive Burda of the intangible right of honest services to engage in a scheme consisting in part of a number of breaches of the duties owed to Burda by its President.
Indeed, in Sancho, which was the first Court of Appeals case in this Circuit to interpret the "honest services" provision in § 1346, the Court of Appeals held that there was "no doubt's in 1998 that a consultant was under a legal duty to inform the intended victim of a bribe that the defendant had offered him the bribe when the intended victim had hired the consultant to undertake an investigation of a financial opportunity that the defendant was offering and the bribe was intended to undermine the accuracy of the investigation. Sancho, 157 F.3d at 921. Although the Court of Appeals did not address any void-forvagueness challenge in that case, the Court of Appeals concluded that there was also "no doubt" that this duty fell within the meaning of "honest services" under § 1346. Id.
Finally, a prosecution for mail or wire fraud requires a showing of specific intent to defraud. See, e.g., United States v. Autuori, 212 F.3d 105, 116 (2d Cir. 2000); see also Rybicki, 287 F.3d at 262 (discussing specific intent requirement in application to charge for deprivation of honest services). A requirement of specific intent can prevent even a broadly-framed statute from being voided for vagueness because a specific intent requirement can ensure that a defendant is on notice that his actions were wrong. See, e.g., Rybicki, 287 F.3d at 263. Indeed, the Court of Appeals has held that to convict a defendant of mail or wire fraud where the purpose of the scheme is to deprive another of the intangible right of honest serviced, within the meaning of § 1346, the government is required to prove "that it was reasonably foreseeable that the fraudulent scheme could result in some economic consequence that was more than de minimis." Id. at 267.
In sum, § 1346 is not unconstitutionally vague as applied to the portions of the charges alleging that Viertel engaged in a scheme to deprive Burda of the intangible right of the honest services of its President.
B.
Viertel argues that the allegations of schemes to deprive another of the intangible right of honest services should also be dismissed against him because the Court of Appeals has allegedly specified that § 1346 applies only to circumstances "in which the defendant breached or induced a breach of a duty owed by an employee or agent to his employer or principal that was enforceable by an action in tort." Rybicki, 287 F.3d at 264. Viertel argues that the government does not allege that he breached any duty to Burda or that he induced Blumenberg to breach any duty to Burda.
However, there is no requirement that the defendant himself owe the duty to the employer or principal, and Rybicki's description of cases that have uphheld convictions pursuant to § 1346 is not exhaustive of all the situations that satisfy the statute. The wire fraud and mail fraud statutes prohibit any person from "having devised or intending to devise any scheme or artifice to defraud," including a "scheme or artifice to deprive another of the intangible right of honest services" that meets the other requirements of the relevant provisions, see 18 U.S.C. § 1341, 1343 1346, and the current Indictment charges Viertel with having devised and intending to devise a scheme to deprive Burda of the honest services of one of its high-ranking employees. The Indictment also cites the aiding and abetting statute, 18 U.S.C. § 2, and there is no reasonable basis to find that aiding or abetting a violation of these provisions, which are themselves sufficiently clear to withstand a void-forvagueness challenge, could be challenged as unconstitutionally vague. The conduct charged thus falls squarely within the plain language of these provisions.
This conclusion is also consistent with other cases from the Court of Appeals that have upheld convictions under § 1346, and which are therefore equally binding after Handakas under Rybicki. For example, in Sancho, the Court of Appeals upheld a wire fraud conviction relating to a defendant who had devised a scheme to deprive a company of the honest services of a person who the defendant believed to be one of the company's consultants, although the purported consultant was actually an undercover agent, and although it was the consultant, and not the defendant, who purportedly owed a duty of disclosure to the company. Sancho, 157 F.3d at 920-21. The fact that the defendant believed that the undercover agent was a consultant who owed those duties to the company and nevertheless knowingly intended to devise a scheme to deprive the company of these duties owed by this purported consultant was sufficient to sustain the honest services fraud conviction. Sancho is also instructive with regard to Viertel's argument that § 1346 charges are limited to circumstances where the defendant induces the breach of a duty. In Sancho, the undercover agent had prompted the fraudulent scheme by telling the defendant that he would conceal a number of risks in an investment opportunity that the defendant was offering to the company and would advise the company to proceed with the investment, if the defendant paid the agent $1.25 million. Id. at 919. Similarly, in Middlemiss, while there was a scheme involving the breach of one of the defendant's fiduciary duties to the JFK Airport, the Court of Appeals upheld the conviction for participating in a scheme to deprive JFK Airport of the intangible right of honest services against another defendant, Setiri Sotiriou, who had allegedly participated in the scheme but who did not allegedly owe any fiduciary duty to the airport. Middlemiss, 217 F.3d at 119-21.
For all of the above reasons, Viertel's motion to dismiss the § 1346 charges against him is denied.
V.
Viertel moves to compel production of any materially exculpatory evidence within the meaning of Brady v. Maryland, 373 U.S. 83 (1963). At oral argument on this motion, the government represented that it is aware of its obligations under Brady, that it was not aware of any outstanding Brady materials in its possession at the time, and that it would make any such material available to the defense and to the Court in an appropriately timely manner if and when it becomes aware of any such material. See generally United States v. Coppa, 267 F.3d 132, 142 (2d Cir. 2001) (due process requires that Brady materials be produced in time for the defendant's effective use of the materials at trial). Viertel has not provided any reason to believe that this representation is not accurate and sufficient, and this kind of representation is generally accepted as sufficient. See, e.g., United States v. Szur, No. S5 97 Cr. 108, 1998 WL 132942, at *15 (S.D.N.Y. Mar. 20, 1998), aff'd, 289 F.3d 200 (2d Cir. 2002); United States v.. Velascruez, No. S9 96 Cr. 126, 1997 WL 414132, at *6 (S.D.N.Y. July 23, 1997); see also United States v. Acruirre-Parra, 763 F. Supp. 1208, 1216 (S.D.N.Y. 1991). The government has also indicated that it is aware of the risks involved in producing genuine Brady materials in an untimely manner, and, in response to a number of requests from the defendants, the government has identified a number of witnesses with possible information relating to a number of issues, such as the internal controls at Burda, that appear clearly not to fall under Brady and to go beyond any requirements of Brady. In these circumstances, there is no basis for the order the defendant seeks.
In addition, to the extent that Viertel's request is for impeachment material under Gicrho v. United States, 405 U.S. 150 (1972), the government has represented that it will make such information available to Viertel at the time that it provides prior statements of witnesses pursuant to the Jencks Act, 18 U.S.C. § 3500. This is sufficient. See United States v. Polanco, No. 97 Cr. 106, 1997 WL 452389, at *3 (S.D.N.Y. Aug. 8, 1997); Velascruez, 1997 WL 414132, at *6.*7. In response to an extended colloquy with the Court relating to the distinction between Brady and Gicrho materials, the government also indicated that it understands that it has an independent obligation under Brady to produce any materially exculpatory evidence that might also constitute impeachment evidence in time for the defendant's effective use of this evidence at trial. This representation is sufficient. See Copra, 267 F.3d at 142 ("[T]he prosecutor must disclose `material' . . . exculpatory and impeachment information no later than the point at which a reasonable probability will exist that the outcome would have been different if an earlier disclosure had been made."); see also Szur, 1998 WL 132942, at *6 (denying request for pre-trial disclosure of impeachment material) (collecting cases). The defendant's motion is therefore denied.
Finally, to the extent that Viertel moved to compel the government to comply with its discovery obligations pursuant to Rule 16 of the Federal Rules of Criminal Procedure, this motion is denied as moot because the government has now produced its discovery in this case, and there is no basis in the papers before the Court to conclude that the production is incomplete.
VI.
Viertel moves pursuant to Rule 7(f) of the Federal Rules of Criminal Procedure for a bill of particulars identifying (i) the date, amount and billing company of each and every allegedly false invoice or bill allegedly submitted to Burda by Viertel or any of the Viertel Companies, as charged in the Second Superseding Indictment; (ii) the amount, date and invoice of any services rendered by Viertel or the Viertel Companies to Blumenberg personally and subsequently billed to Burda; (iii) the date, amount and invoice of each instance where Viertel or the Viertel Companies allegedly billed Burda for services that were not performed; (iv) the date, amount and invoice of each instance where Blumenberg directed a Burda employee to prepare checks payable to cash or to the Viertel Companies, and, for each such instance, the Burda employee who prepared the check; (v) the date, amount, invoice and deposit amount of each and every instance where Blumenberg directed a Burda employee to deposit checks directly into the bank account of a Viertel Company, the employee who allegedly deposited these checks, and the Viertel Company to which the check or checks were deposited; (vi) each and every individual alleged to be a member of the conspiracy charged in the Second Superseding Indictment.
The decision whether to grant a bill of particulars pursuant to Rule 7(f) rests with the sound discretion of the district court. See United States v. Cephas, 937 F.2d 816, 823 (2d Cir. 1991); United States v. Panza, 750 F.2d 1141 (2d Cir. 1984); United States v. Strawberry, 892 F. Supp. 519, 526 (S.D.N.Y. 1995); United States v. Jones, No. 00 Cr. 182, 2000 WL 1448640, at *2 (S.D.N.Y. Sep. 28, 2000). The purpose of a bill of particulars is to enable a defendant "to prepare for trials to prevent surprise, and to interpose a plea of double jeopardy should he be prosecuted a second time for the same offense." United States v. Bortnovsky, 820 F.2d 572, 574 (2d Cir. 1987) . A bill of particulars is required "only when 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) (citation omitted); see also Cephas, 937 F.2d at 823; Panza, 750 F.2d at 1148. The government may not be compelled to provide a bill of particulars disclosing the manner in which it will attempt to prove the charges, the precise manner in which the defendant committed the crime charged, or a preview of the government's evidence or legal theories. United States v. Mitlof, 165 F. Supp.2d 558, 569 (S.D.N.Y. 2001) (collecting cases). "Generally, if the information sought by the defendant is provided in the indictment or in some acceptable alternate form, no bill of particulars is required." Bortnovsky, 820 F.2d at 574; see United States v. Barnes, 158 F.3d 662, 665 (2d Cir. 1998); see also United States v. Szur, 1998 WL 132942, at *11.
In this case, the conspiracy charged against Viertel in the Second Superseding Indictment is adequately detailed and straightforward, and outlines with specificity the kinds of fraudulent invoices that Viertel and Blumenberg allegedly conspired to create and the means and methods of the .conspiracy. The government has also already produced discovery, including invoices submitted by the Viertel Companies to Burda and several thousand pages of bank records from Burda's, Blumenberg's and Viertel's bank accounts, and Viertel has been given ample time to review that discovery. To the extent that there was any question identifying which of these invoices were allegedly fraudulent, the government has provided Viertel with a letter dated June 17, 2002, which states: "[w]ith respect to the Viertel companies . . . the Government cQntends that none of the charges submitted during the period of the scheme charged in the Indictment (i.e. from in or about 1992 through in or about July 1996) were legitimate, with the possible exception of some smaller charges submitted on behalf of Transvideo." See Letter from the Government to the Defendants dated June 17, 2002. The substantive counts in the Second Superseding Indictment also explicitly allege the specific mailing and use of the wires that form the jurisdictional bases for these counts. The charges in the current Indictment, when coupled with the government's discovery and its June 17, 2002 letter, sufficiently advise Viertel of the details of the charges against him to prepare for trial, to avoid surprise, and to plead any appropriate claim for double jeopardy if subsequent charges are filed against him based on the same alleged actions. See United States v. Muyet, 945 F. Supp. 586, 599 (S.D.N.Y. 1996); United States v. Ruiz, 702 F. Supp. 1066, 1070-71 (S.D.N.Y. 1989).
To the extent that Viertel requests the identification of the Burda employees who were allegedly directed to prepare each check for Viertel or a Viertel Company, or to deposit each check directly into one of their accounts, Viertel seeks information that goes beyond the information necessary to apprise him of the allegations against him. Similarly, Viertel is not entitled to a list of all unindicted co-conspirators. See United States v. Trippe, No. 00 Cr. 585, 2001 WL 4.34849, at *7.8 (S.D.N.Y. Apr. 27, 2001) (denying bill of particulars seeking names of all co-conspirators and aiders and/or abettors in securities and mail fraud case in light of sufficiency of information contained in the Indictment and through discovery) (collecting cases). To the extent that Viertel's request for the identities of unnamed co-conspirators is really a request for a list of the witnesses that the government intends to call at trial, the defendant is not entitled to such a list because he has not made the necessary specific showing of need. See Jones, 2000 WL 1448640, at *3 (collecting cases). Finally, to the extent that Viertel seeks lists of the specific invoices for which services were allegedly performed for Blumenberg personally and the specific invoices for which services were allegedly not performed at all, the motion is denied because the conspiracy charge and the other materials produced in this case adequately apprise Viertel of the activities charged against him. The motion for a bill of particulars is therefore denied.
CONCLUSION
For the foregoing reasons:
1. All of the motions by Lee are denied as moot, with respect to Lee, in light of the government's filing of a nolle prosequi with regard to him.
2. Viertel's motion to sever his trial from Lee's pursuant to Rules 8(b) and 14 of the Federal Rules of Criminal Procedure is denied as moot in light of the fact that there is only one defendant remaining in this case.
3. Viertel's motion to dismiss count one of the First Superseding Indictment as duplicitous is denied as moot with respect to Viertel in light of the government's filing of the Second Superseding Indictment.
4. Viertel's motion to dismiss the conspiracy charged against him in the Second Superseding Indictment on statute of limitations grounds is denied.
5. Viertel's motion to dismiss those portions of the charges against him in the Second Superseding Indictment that allege a scheme to deprive another of the intangible right of honest services is denied.
6. Viertel's motion to compel production of any materially exculpatory materials under Brady is denied.
7. Viertel's motion pursuant to Rule 7(f) of the Federal Rules of Criminal Procedure for a bill of particulars is denied.