People v. Steiner
| Decision Date | 07 October 1980 |
| Citation | 432 N.Y.S.2d 83,77 A.D.2d 13 |
| Parties | The PEOPLE of the State of New York, Appellant, v. Helmut STEINER, Defendant-Respondent. |
| Court | New York Supreme Court — Appellate Division |
Arthur Weinstein, New York City, of counsel (Charles J. Hynes, New York City, for appellant.
Jack S. Hoffinger, New York City, of counsel (Robert A. Goldshlag and Stephen L. Weiner, New York City, with him on brief; Hoffinger, Friedland & Roth, New York City, for defendant-respondent.
Before FEIN, J. P., and SANDLER, SULLIVAN, BLOOM and CARRO, JJ.
The People appeal from the dismissal of an indictment accusing the defendant of three counts of perjury in the first degree. The dismissal was grounded upon a finding that "the evidence is insufficient in law to find guilt beyond a reasonable doubt." This determination was based upon a conclusion that "a fair analysis of the entire testimony is consonant with fallibility of memory, not with deliberate falsification." Trial Term also concluded, "as a matter of law it was unfair not to probe this man's mind and give him the benefit of an attempt to refresh his recollection." The court also expressed "serious doubts as to whether there was corroboration as to the third count."
There should be a reversal.
The Florence Nightingale Nursing Home in Manhattan, owned by Charles E. Sigety, is the largest in the State. From May 1971 to March 1975 defendant was its Food Service Director, in charge of purchasing all food items. In this capacity he was in a position to select the food service suppliers.
Defendant was called before a New York County grand jury in December 1978 as part of the investigation by Special Prosecutor Charles J. Hynes into allegation of criminal activity in the nursing home industry. This portion of the investigation focused on illegal kickbacks, rebates and cash payments from vendors and suppliers to nursing home owners and employees, all contributing to Medicaid fraud.
Defendant, who obtained immunity through his grand jury testimony, testified at some length concerning fiscal abuses and illegal activity by Sigety, the owner of the nursing home and the principal target of the investigation. In such testimony defendant implicated himself as well as Sigety.
With respect to his own activity, defendant initially testified that he recalled the names of a number of suppliers, despite the passage of time, but denied personal knowledge of "any form of kickback, or cash rebate or refund of any kind to any nursing home employees", noting that he had personally rejected offers of bribes and kickbacks. He conceded, however, that kickbacks had been common between the home and its suppliers when he was hired. He admitted that he was offered bribes and kickbacks, but claimed he rejected them. Defendant told the grand jury that one supplier would give him an envelope full of cash each month, which defendant would deliver unopened to the accounting office. This payment, according to defendant, was not a kickback, but rather was a "standing discount" of 3-5% given to the nursing home.
Defendant testified that four vendors, named by him, had offered bribes or kickbacks, which he rejected. Aside from these four defendant denied conversations with any other vendors as to kickbacks, cash rebates or refunds, and denied receipt of any such payment.
Among the suppliers defendant recalled as having done business with the nursing home were Lakowitz and Wexler. These men testified some months prior to defendant, Irving Lakowitz, a salesman for Triad Supply Corporation, told the grand jury that defendant had insisted on a cash kickback of 5% per month ("the going rate") if Triad wanted the nursing home's business. After some negotiation, Lakowitz paid defendant $25 per month in 1973, raised to $30 or $35 in 1974, plus $250 at Christmas. Lakowitz further testified about a phony bill he prepared at defendant's behest for $1,492 in merchandise that was paid for by the nursing home but never delivered. According to Lakowitz, defendant signed a receipt for this phantom delivery in exchange for which he received an envelope with $500 in cash obtained from Triad's president, Sam Weinstein. Weinstein confirmed Lakowitz' version of the false invoice deal in exchange for a $500 payoff, although he testified he never met or spoke with defendant in connection with this transaction.
Seymour Wexler, owner of Disco Wholesale Meats, Inc., testified that his company had a standing arrangement to pay defendant (and his predecessor) 5% of the monthly gross of sales to the nursing home, amounting to nearly $10,000 in cash payments over the 4-year relationship. Wexler conceded that the money for these payments came from padding the price or short-weighting deliveries.
The grand jury returned a 3-count indictment for perjury in the first degree. The first count concerned defendant's denial of request for or receipt of kickbacks, cash rebates or refunds from vendors. The second concerned his denial of any conversations with vendors about 5% kickbacks, cash refunds or rebates. The third involved his denial of discussions about a fictitious invoice for goods never delivered.
In March 1980, nearly seven months after rejecting an earlier motion to dismiss the indictment, Trial Term reversed itself and granted a subsequent motion for dismissal. After noting that most of defendant's testimony concerned the improprieties of his employer, Sigety, Trial Term based its dismissal primarily on the fact that the questions were too "general" to support a perjury indictment. In other words, in denying receipt of kickbacks in general, defendant was never specifically asked about possibly having received kickbacks from Lakowitz of Triad or Wexler of Disco. Defendant acknowledged a vague recollection of Lakowitz, when asked with whom he had dealt at Triad, but he was never specifically asked if he had ever demanded and/or received a $500 payoff from him on a fictitious invoice. Defendant's memory in response to these "general" questions could not as a matter of law, according to Trial Term, support an indictment for "purposeful perjury". Trial Term concluded that "a fair analysis of the entire testimony is consonant with fallibility of memory, not with deliberate falsification." As noted, the indictment was dismissed on a finding that "the evidence (was) insufficient in law to find guilt beyond a reasonable doubt". The implication is that defendant was trapped into the perjury indictment.
Trial Term erred in applying the "reasonable doubt" standard to the indictment. That is more properly the test for conviction of an offense (CPL 70.20). CPL 190.65, subd. 1, delineates the standard for a grand jury indictment:
"Subject to the rules prescribing the kinds of offenses which may be charged in an indictment, a grand jury may indict a person for an offense when (a) the evidence before it is legally sufficient to establish that such person committed such offense and (b) competent and admissible evidence before it provides reasonable cause to believe that such person committed such offense."
"In the context of the Grand Jury procedure, legally sufficient means prima facie, not proof beyond a reasonable doubt" (People v. Mayo, 36 N.Y.2d 1002, 1004, 374 N.Y.S.2d 609, 337 N.E.2d 124).
Plainly a prima facie case was...
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