U.S. v. Rodolitz, 1448

• Decision Date: 17 March 1986
• Docket Number: No. 1448,D,1448
• Citation: 786 F.2d 77
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Abraham J. RODOLITZ, Defendant-Appellant. ocket 85-1112.
• Court: U.S. Court of Appeals — Second Circuit

Page 77

786 F.2d 77

UNITED STATES of America, Plaintiff-Appellee, v. Abraham J. RODOLITZ, Defendant-Appellant.

No. 1448, Docket 85-1112.

United States Court of Appeals,

Second Circuit.

Argued Aug. 13, 1985.

Decided March 17, 1986.

Richard A. Stanley, Sp. Asst. U.S. Atty., New York City, (Rudolph W. Giuliani, U.S. Atty. for S.D.N.Y., Stuart E. Abrams, Asst. U.S. Atty., on brief), for plaintiff-appellee.

Jeffrey A. Rabin, Brooklyn, New York City, for defendant-appellant.

Before NEWMAN and WINTER, Circuit Judges, and COFFRIN, Chief District Judge. ^*

COFFRIN, Chief District Judge:

Defendant Abraham J. Rodolitz appeals from a judgment of conviction entered in the United States District Court for the Southern District of New York (John E. Sprizzo, Judge) on March 27, 1985. The jury convicted Rodolitz of three counts of mail fraud in violation of 18 U.S.C. Sec. 1341 and one count of tampering with a witness in violation of 18 U.S.C. Sec. 1512. The case arises out of defendant's allegedly fraudulent scheme to conceal from the Massachusetts Bay Insurance Company his involvement in the repair of a damaged roof on one of his own buildings. In addition, the defendant allegedly attempted to persuade a witness to lie before a federal grand jury. On appeal, Rodolitz contends, inter alia, that the government presented insufficient evidence to establish either mail fraud or tampering with a witness. He also alleges that assorted trial defects constitute reversible error. For the reasons stated below, we affirm both convictions.

I. BACKGROUND

In late 1976, a windstorm damaged the roof of a commercial building owned by Oak Point Industrial Park, Inc. ("Oak Point"). Rodolitz owned Oak Point and, through the Massachusetts Bay Insurance Company, had insured the building against damage.

After the building was damaged, Rodolitz initiated a fraudulent plan designed to inflate the recovery of the claim against the insurance company. To accomplish this, either Rodolitz or one of his associates set up bank accounts in the name of one of After using this method to establish a paper trail, Rodolitz filed a claim with the Massachusetts Bay Insurance Company for the $1,248,000 he asserts he expended in repairing the roof. He did not, however, reveal his connection to the companies purportedly involved in the repair. After the insurance company declined to pay the claimed amount, Oak Point sued the company in a New York state court and received a jury verdict of $1,226,241.39. ¹ At no point, however, did Rodolitz reveal to the jury in that case that all money expended on the repair eventually returned to him.

several business entities. These businesses include Bolla Supply Company ("Bolla Supply"), Lawrence Roofing and Sheet Metal Company ("Lawrence Roofing"), and Tubular Products Manufacturing Company. Rodolitz also maintained an account in the name of Zeroy Industrial and Distribution Corporation ("Zeroy") which became active in this plan. Rodolitz, himself or through his associates, transferred funds between these corporations in an effort to create an appearance of legitimate transactions in roofing supplies and services between the businesses. According to the documents evincing the purported transactions, Rodolitz hired Lawrence Roofing and Zeroy to repair the roof on the Oak Point building. Lawrence Roofing and Zeroy then purportedly purchased from Bolla Supply the supplies necessary to perform the job. In fact, Rodolitz owned or controlled all the businesses and merely transferred money, materials and services between different branches of those businesses to give the illusion of arm's length transactions.

During the course of the civil suit against the insurance company, Rodolitz caused the mails to be used on three separate occasions to further his attempt to recover the $1,248,000 from the insurance company.

After Rodolitz learned that a federal grand jury was investigating his activities in connection with his claim under the insurance policy, he attempted to persuade one Seymour Blutstein to lie in certain significant respects about Bolla Supply. At Rodolitz's request, Blutstein had fronted for Bolla Supply. He opened a bank account indicating through the Certificate of Doing Business that he was engaged in dealing in building material and supplies under that trade name. He deposited checks furnished by Rodolitz in the account and made withdrawals, as Rodolitz directed, to other payee business entities created by Rodolitz. Blutstein, granted immunity by the government, eventually refused to tell the story which Rodolitz had requested even though initially he had advised Rodolitz he would do so.

II. DISCUSSION

Rodolitz claims on appeal that the government offered insufficient evidence as a matter of law to convict him of mail fraud in violation of 18 U.S.C. Sec. 1341, or of witness tampering in violation of 18 U.S.C. Sec. 1512. It is well established that the reviewing court must sustain the jury verdict in a criminal case if, "viewing the evidence in the light most favorable to the Government, any rational trier of facts could have found the defendant guilty beyond a reasonable doubt." United States v. LeRoy, 687 F.2d 610, 616 (2d Cir.1982) (citing Jackson v. Virginia, 443 U.S. 307, 99 S.Ct. 2781, 61 L.Ed.2d 560 (1979)), cert. denied, 459 U.S. 1174, 103 S.Ct. 823, 74 L.Ed.2d 1019 (1983). Defendant, therefore, bears a very heavy burden. United States v. Carson, 702 F.2d 351, 361 (2d Cir.), cert. denied, 462 U.S. 1108, 103 S.Ct. 2456, 77 L.Ed.2d 1335 (1983).

We find that the defendant clearly failed to meet his heavy burden with regard to the three mail fraud convictions. The government presented ample evidence from which a jury could find beyond a reasonable doubt that defendant conducted a scheme to defraud and the use of the mails in furtherance thereof. Although a closer question, we also find that the record provides

sufficient evidence for a jury to find, beyond a reasonable doubt, defendant guilty of tampering with a witness.

A. Mail Fraud

To establish mail fraud, the government "must show that the defendant (1) participated in a scheme to defraud; and (2) knowingly used the mails to further the scheme." United States v. Gelb, 700 F.2d 875, 879 (2d Cir.), cert. denied, 464 U.S. 853, 104 S.Ct. 167, 78 L.Ed.2d 152 (1983). See United States v. Corey, 566 F.2d 429, 430 n. 2 (2d Cir.1977); United States v. Cyphers, 556 F.2d 630, 632 (2d Cir.), cert. denied, 431 U.S. 972, 97 S.Ct. 2937, 53 L.Ed.2d 1070 (1977). In addition, "[p]roof of a fraudulent scheme requires evidence showing a specific intent to defraud." Gelb, 700 F.2d at 879. See also United States v. Bronston, 658 F.2d 920, 927 (2d Cir.1981) ("to make out a mail fraud violation, the Government must show that the scheme was devised with the specific intent to defraud, ... that the use of the mails in furtherance of the scheme was reasonably foreseeable, ... that ... any nondisclosures or affirmative misrepresentations must have been material, ... [and] that some actual harm or injury was at least contemplated ...") (citations omitted), cert. denied, 456 U.S. 915, 102 S.Ct. 1769, 72 L.Ed.2d 174 (1982). But see United States v. Newman, 664 F.2d 12, 20 (2d Cir.1981) (not required that government prove contemplation of harm in mail fraud case based upon breach of fiduciary duty by a private employee), cert. denied, 464 U.S. 863, 104 S.Ct. 193, 78 L.Ed.2d 170 (1983).

Evidence that the mails were used in furthering Rodolitz's insurance claim is uncontroverted. Rodolitz, however, claims that the government provided no proof that he acted with an intent to defraud or harm the insurance company or that his activities constituted a fraudulent scheme. He contends that he received only what he was due under the insurance policy, to wit, the actual value of the loss sustained in the windstorm. He urges that any recovery he may have been awarded in excess of the actual value of the loss was due to a good faith error in estimation of the cost of repair. Rodolitz contends that because he got only that to which he was entitled under the policy, it is of no moment legally that circuitous or deceptive means were employed relative to the manner and cost of repair. For two reasons, we find appellant's argument completely without merit.

First, he argues that he received only that to which he was lawfully entitled under the Massachusetts Bay policy. That policy provides that recovery for damages be limited to the smallest of (1) the $3.8 million policy limit, (2) the replacement cost of the property intended for the same use, or (3) the amount actually and necessarily expended in repairing the property. If he sought only that to which he was legally entitled, no necessity existed for Rodolitz to hatch a fraudulent scheme. The evidence shows that Rodolitz opened and used sham bank accounts for a number of business entities. By transferring funds between these accounts, he created an appearance of "arm's length" ² purchases of materials, some or most of which, according to Blutstein's testimony, Rodolitz already owned. Obviously under such an arrangement Rodolitz was in a position to "purchase" his own materials to repair the roof at whatever price he chose to invoice them to one of his own companies. Based on this evidence, the jury had ample grounds to find that Rodolitz developed and participated in this scheme to successfully recover more from the insurance company than he was lawfully due.

Second, and more importantly, it was not necessary for the government to prove that Rodolitz recovered more from the insurance company than that to which he was entitled. To sustain the conviction, the government needed to prove only that Rodolitz employed a deceptive scheme intending The evidence of the scheme was overwhelming. Rodolitz used sham business entities and several bank accounts to conceal his direct involvement with all aspects of the roof repair. In fact, he admitted...