U.S. v. Schlesinger, CR.02-485(ADS)(ARL).
Citation | 438 F.Supp.2d 76 |
Decision Date | 17 July 2006 |
Docket Number | No. CR.02-485(ADS)(ARL).,CR.02-485(ADS)(ARL). |
Parties | UNITED STATES of America, v. Nat SCHLESINGER, also known as "Naftule Schlesinger" and "Zvi Pollack," Herman Niederman, and Goodmark Industries, Inc., Defendants. |
Court | United States District Courts. 2nd Circuit. United States District Court (Eastern District of New York) |
Roslynn R. Mauskopf, United States Attorney, by Lawrence Philip Ferazani, Cynthia M. Monaco Central Islip, NY, Richard Lunger, Assistant U.S. Attorneys, for United States of America.
Lipsitz, Green, Fahringer, Roll, Salisbury & Cambria, LLP, New York, NY (Herald Price Fahringer, of Counsel), Jeremy L Gutman, New York, NY, for the defendants Nat Schlesinger and Goodmark Industries, Inc. Michael L. Soshnick, Esq., Adrian L. Diluzio, Esq., Mineola, NY, for the defendant Nat Schlesinger.
In this motion pursuant to Rule 33 of the Federal Rules of Criminal Procedure ("Fed. R.Crim.P.") the defendant Nat Schlesinger ("the defendant") seeks a new trial on his conviction following a trial by a jury, of thirty various counts of arson, conspiracy, insurance fraud, creditor fraud, and money laundering, on the basis of newly discovered evidence. The motion calls into question the veracity of two witnesses, primarily with the use of a surreptitiously recorded witness recantation. In addition, the defendant also alleges that the government not only withheld information useful for impeachment, but knowingly permitted false testimony concerning such information. Although the testimony at issue, and all of the alleged newly discovered evidence, relate only to the arson counts, the defendant seeks dismissal of the entire conviction on the theories of prosecutorial misconduct and prejudicial spillover. The Court begins with a table of contents.
On October 1, 2003, a grand jury entered a 34 count Superseding Indictment ("Indictment") against defendants Nat Schlesinger, Herman Niederman, and Goodmark Industries, Inc., charging arson, conspiracy, insurance fraud, creditor fraud, and money laundering, arising out of, among other acts, a series of five fires dating back to 1987 that occurred at a clothing factory in the Williamsburg section of Brooklyn. The Indictment alleged that Nat Schlesinger owned and maintained the factory with his brother, Jack Schlesinger, in a building that had various addresses due to the fact that the building occupied an entire city block and had multiple entrances.
The Indictment alleged that Nat Schlesinger and his brother masked their ownership of the numerous clothing manufacturing companies that occupied this location from the time they purchased the building in the early 1980's in order to conceal certain fraudulent schemes. One scheme involved defrauding insurance companies by submitting fraudulent claims for losses resulting from a series of five separate fires that occurred at the Premises from 1987 to 1999. The second scheme involved using various companies as vehicles to defraud creditors.
The Indictment also charged Nat Schlesinger with one count of arson and one count of use of fire to commit a felony in connection with the fire that occurred at the factory on December 31, 1998. The indictment charged that Nat Schlesinger deliberately caused a fire in the factory on the night of December 31, 1998 for the purpose of submitting a false and inflated insurance claim totaling approximately $4,590,000.
On April 11, 2005, a jury trial was commenced on the charges in the indictment.
At the trial the government offered overwhelming evidence of the two fraudulent schemes alleged in the indictment. In connection with the scheme to fraudulently inflate insurance claims on the five fires that occurred at the factory, through witnesses and numerous documents, the government showed that the defendant, through his various clothing businesses, unlawfully obtained money in the sum of $4,510,629.41 from insurance companies by bribing employees and adjusters, and submitting false documentation in support of fraudulent insurance claims. This amount was received by the defendant's businesses from insurance companies in payment of fraudulently inflated claims for the fires that occurred at the clothing factory. In addition, the government also established that this same sum of 54,510,629.41 in fraudulent insurance payments was laundered when it was deposited into and transferred through the various business accounts of the defendant and his businesses.
The government also submitted ample evidence proving the second complex creditor fraud scheme. This scheme involved the use of the defendant's companies Pous Apparel, Inc., Private Brands, Inc., and Goodmark Industries, Inc., as vehicles to defraud various creditors by masking the true ownership of the companies. This was accomplished by the use of nominees and shell corporations, and ultimately succeeded in carrying out what was, in effect, two self organized bankruptcies. Specifically, one of the fraudulent acts that the government proved at the trial was that Nat Schlesinger foreclosed on Goodmark Industries' machinery and equipment by using a company he controlled known as Western Industries, Inc., leaving the creditors of Goodmark without any recourse against Goodmark's assets. The evidence also showed that Nat Schlesinger masked his ownership of Western Industries through a series of nominees and transactions with shell corporations. After foreclosing on the Goodmark assets, Western Industries then sold the equipment at auction for the sum of $72,525.
In comparison to the overwhelming direct evidence offered with regard to the two fraudulent schemes, the government's case on the arson counts consisted of circumstantial evidence. The government called several witnesses to testify about the...
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