U.S. v. Weiss

Decision Date27 May 2011
Docket NumberCase No. 6:98–cr–99–Orl–19KRS.
PartiesUNITED STATES of Americav.Sholam WEISS, et al.
CourtU.S. District Court — Middle District of Florida

OPINION TEXT STARTS HERE

ORDER

PATRICIA C. FAWSETT, District Judge.

This case comes before the Court on the following:

1. Motion for Summary Judgment by United States of America (Doc. No. 2327, filed Jan. 31, 2011);

2. Statement of Uncontested Material Facts in Support of Motion for Summary Judgment by United States of America (Doc. No. 2328, filed Jan. 31, 2011);

3. Motion for Summary Judgment by Petitioner Goldie Feig (Doc. No. 2329, filed Jan. 31, 2011);

4. Statement of Facts in Support of Motion for Summary Judgment by Petitioner Goldie Feig (Doc. No. 2330, filed Jan. 31, 2011);

5. Response to Petitioner's Motion for Summary Judgment by United States of America (Doc. No. 2338, filed Feb. 14, 2011);

6. Response to Government's Motion for Summary Judgment by Petitioner Goldie Feig (Doc. No. 2339, filed Feb. 14, 2011); 7. Response to Government's Statement of Uncontested Material Facts by Petitioner Goldie Feig (Doc. No. 2340, filed Feb. 14, 2011);

8. Reply to Response to Petitioner's Motion for Summary Judgment by Petitioner Goldie Feig (Doc. No. 2343, filed Feb. 25, 2011);

9. Notice of Filing Apostille for the Affidavit of Rabbi Solomon Unsdorfer by Petitioner Goldie Feig (Doc. No. 2344, filed Mar. 2, 2011);

10. Notice of Filing a Re–Notarized Affidavit of Rabbi Salomon Unsdorfer by Petitioner Goldie Feig (Doc. No. 2348, filed Mar. 17, 2011);

11. Notice of Filing a Re–Notarized Affidavit of Sholam Weiss by Petitioner Goldie Feig (Doc. No. 2349, filed Mar. 17, 2011);

12. Reply to Response to Government's Statement of Uncontested Material Facts in Support of Motion for Summary Judgment by United States of America (Doc. No. 2345, filed Mar. 7, 2011);

13. Reply to Response to Government's Motion for Summary Judgment by United States of America (Doc. No. 2346, filed Mar. 7, 2011);

14. Report and Recommendation of United States Magistrate Judge Recommending the Denial of the Motions for Summary Judgment of Petitioner and United States of America (Doc. No. 2367, filed Apr. 15, 2011);

15. Objections to Report and Recommendation by United States of America (Doc. No. 2371, filed Apr. 28, 2010);

16. Objections to Report and Recommendation by Petitioner Goldie Feig (Doc. No. 2372, filed Apr. 29, 2010);

17. Response to Petitioner's Objections to Report and Recommendation by United States of America (Doc. No. 2378, filed May 13, 2011); and

18. Response to Government's Objections to Report and Recommendation by Petitioner Goldie Feig (Doc. No. 2379, filed May 13, 2011).

Background
I. Procedural History

Defendant Sholam Weiss was convicted of various crimes, including racketeering in violation of the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. § 1961, et seq. (Doc. No. 1267, filed Nov. 1, 1999.) The jury found that Weiss should forfeit specifically named properties and money. (Doc. No. 1276, filed Nov. 2, 1999.) During the criminal trial Weiss admitted that he used nominees to “hide out” from banks and judgment creditors. (Doc. No. 2328–45 at 3.) The Court has noted throughout the post-trial proceedings in this case that Weiss typically used the modus operandi of installing nominees to act as a front in name for Weiss's ownership interests. (Doc. No. 1955 at 6–7.)

On January 19, 2009, the Court entered a Preliminary Order of Forfeiture for Substitute Assets belonging to Weiss in partial satisfaction of the outstanding forfeiture money judgment. (Doc. No. 2137.) The substitute assets include real properties located at 255 Viola Road, Monsey, New York (“Viola Road”) and 65 East Concord Drive, Monsey, New York (“Concord Drive”). ( Id. at 1–2.) Both of these properties are presently titled in the name of Weiss's wife, Goldie Feig Weiss (“Feig”). ( Id.)

On November 24, 2009, Feig filed a Petition of Innocent Ownership to exclude the Viola Road and Concord Drive properties from forfeiture. (Doc. No. 2251.) Both the Government and Feig have moved for summary judgment on the Petition, and Magistrate Judge Karla R. Spaulding has entered a Report and Recommendation denying both Motions. (Doc. Nos. 2327, 2328, 2367.) Feig and the Government have filed objections to the Report and Recommendations, and both parties' objections are opposed by a response. (Doc. Nos. 2371–72, 2378–79.)

II. Viola Road

The disputed ownership of the Viola Road property centers on the validity of a Separation Agreement between Feig and Weiss purporting to transfer the Viola Road property from Weiss to Feig and the extent to which Weiss resided at and exercised control over the Viola Road property after he and Feig separated. The evidence of record on each of these matters is discussed below.

A. Separation Agreement

Weiss and Feig were married in 1975. (Doc. No. 2309–1 at 1.) On July 2, 1988, Weiss purchased the Viola Road property, taking title in his name only. (Doc. No. 2328–3 at 1; Doc. No. 2328–4 at 3.) Feig has lived at the Viola Road property since 1989. (Doc. No. 2328–5 at 3; Doc. No. 2251 ¶¶ 5, 7.)

Weiss was the President and sole shareholder of Windsor Plumbing Supply, Inc. (“Windsor”). (Doc. No. 2328–1 at 4.) Two lawsuits were filed against Weiss and Windsor in November of 1988 and January of 1989. (Doc. No. 2328–7 at 7; Doc. No. 2328–9 at 1.) On May 25, 1989, Weiss mortgaged the Viola Road property for $250,000 in favor of Moshe Mishal. (Doc. No. 2328–11.) On August 17, 1989, Weiss filed a satisfaction of this mortgage reflecting payment of $300,000. (Doc. No. 2328–13.) On the same day, Weiss took out another mortgage on the Viola Road property in the amount of $390,000 from Williamsburg Savings Bank. (Doc. No. 2328–14.)

Pursuant to a “Separation Agreement” dated October 26, 1989, Weiss transferred the Viola Road property to Feig. (Doc. No. 2328–30 ¶ 2.) On March 9, 1990, approximately six weeks after Windsor's creditors filed a petition for involuntary bankruptcy against Windsor,1 Weiss filed a deed in the New York public records transferring title of Viola Road to Feig. ( Id.; Doc. No. 2328–20.)

In her deposition of October 19, 2010, taken for purposes of the instant proceeding, Feig testified that she did not have conversations with Weiss about family financial decisions and that Weiss alone made those decisions. (Doc. No. 2328–5 at 9.) Feig further stated that Weiss never told her how much money he made per month and that she and Weiss never discussed Weiss's business or assets. ( Id. at 13–14.)

The Receiver for National Heritage Life Insurance Company deposed Feig on October 27, 2004. (Doc. No. 2338–1.) During that deposition, Feig asserted that she did not read the Separation Agreement and did not speak with any lawyer about the Agreement prior to signing it. ( Id. at 3–4, 7.) Feig also testified that Weiss did not disclose his financial status to her before she signed the Agreement. ( Id. at 7–8.)

Feig filed an affidavit dated February 14, 2011, in response to the Government's Statement of Undisputed Facts filed in support of its Motion for Summary Judgment. (Doc. No. 2340–1.) In her February 2011 affidavit, Feig asserted that at the time Weiss purchased Viola Road in 1988, she mistakenly believed that Viola Road was owned by Weiss and her together. ( Id. ¶ 3.) Feig further explained that she “did not really take part” in negotiating the terms of the Separation Agreement because that was not her religious custom. ( Id. ¶ 6.) Rather, she trusted her father and a three-rabbi tribunal “to make a fair arrangement that would allow [her] and [her] children to continue to live” at the Viola Road residence. ( Id.) Feig maintained that she did not want to get a divorce in 1989 because her children were still young and because divorce was not favored in her religious community. ( Id. ¶ 8.)

The Separation Agreement bears the notary public stamp of Jan R. Schneiderman and two purported signatures of Schneiderman attesting to the execution of the Separation Agreement before her by Weiss on October 5, 1989, and by Feig on October 26, 1989. (Doc. No. 2328–30 at 11.) Schneiderman testified in a deposition in 1992 that she drafted the Separation Agreement based on a list of terms provided to her. (Doc. No. 2340–8 at 33.) She further testified that Feig came to her office to sign the Agreement. ( Id.)

On February 1, 2004, Feig testified during a deposition in a civil case that she signed the Separation Agreement at Schneiderman's office. (Doc. No. 2340–5 at 15.) During her October 2004 deposition, Feig testified that she did not remember the circumstances surrounding the signing of the Separation Agreement, including whether Weiss was present when she signed the Agreement. (Doc. No. 2338–1 at 3.) Most recently, Feig averred in her February 2011 affidavit that she “can[ ]not really recall” signing the Separation Agreement “in detail.” (Doc. No. 2340–1 ¶ 6.)

In a declaration signed in October 2010 and filed by the Government in support of its present Motion for Summary Judgment, Schneiderman attested that Weiss first approached her in early 1990 about preparing a separation agreement in order to protect his assets. (Doc. No. 2328–29 ¶ 7.) She further averred that Weiss instructed her to back-date the agreement so that it would precede the Windsor bankruptcy proceeding. ( Id. ¶ 11.) Schneiderman also declared that sometime in March 1990, Weiss brought her the executed Separation Agreement, at which time she refused to notarize Feig's signature because Feig was not present. ( Id. ¶ 24.) Schneiderman asserted that she did not actually sign or affix her notary stamp on the Separation Agreement. ( Id. ¶¶ 30–31.) Finally, Schneiderman claimed to have lied about these matters in her 1992 deposition discussed above. ( Id. ¶ 34.)

Feig filed an affidavit by Weiss dated March 17, 2011, in response to the Government's Statement of Undisputed Facts filed in support of its Motion...

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    ...or entity is found to be acting as a nominee for someone who[se] property is subject to the forfeiture.' ” United States v. Weiss, 791 F.Supp.2d 1183, 1200 (M.D.Fla.2011) (quoting United States v. Weiss, 467 F.3d 1300, 1308–09 (11th Cir.2006)). A district court looks to the law of the state......
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