United States v. Coburn

• Citation: 439 F.Supp.3d 361
• Decision Date: 14 February 2020
• Docket Number: Crim. No. 19-120 (KM)
• Parties: UNITED STATES of America v. Gordon J. COBURN and Steven Schwartz, Defendants.
• Court: U.S. District Court — District of New Jersey

439 F.Supp.3d 361

UNITED STATES of America

v.Gordon J. COBURN and Steven Schwartz, Defendants.

Crim. No. 19-120 (KM)

United States District Court, D. New Jersey.

Signed February 14, 2020

Courtney A. Howard, Nicholas Paul Grippo, Office of the U.S. Attorney, Newark, NJ, David Adam Last, Sonali Dinesh Patel, United State Department Of Justice, Washington, DC, for Plaintiff.

Hank Bond Walther, Jones Day, Washington, DC, Henry Klehm, III, James Patrick Loonam, Sarah D. Efronson, Jones Day, New York, NY, Alexandra Sage Messiter, Nicholas James Lewin, Krieger Kim & Lewin Llp, New York, NY, for Defendant Gordon J. Coburn.

Joel R. Meyers, Amir Houssein Toossi, Arthur Thomas Tergesen, Jeremy Israel Bohrer, Jonathan Eric Jason, Bohrer PLLC, New York, NY, Roberto Finzi, Justin D. Lerer, Paul Weiss, New York, NY, Theodore V. Wells, Jr., Meredith A. Arfa, Paul, Weiss, Rifkind, Wharton & Garrison, LLP, New York, NY, Daniel B. Weinstein, Lawrence S. Lustberg, Gibbons PC, Newark, NJ, for Defendant Steven Schwartz.

MEMORANDUM and ORDER (Motions, DE 57, 58, 59)

KEVIN MCNULTY, U.S.D.J.

This Indictment arises from allegations that the defendants engaged in a scheme to bribe officials of a foreign government on behalf of Cognizant Technology Solutions Corporation ("Cognizant"). Defendant Gordon J. Coburn, formerly the President and CFO of Cognizant, and Steven Schwartz, formerly Cognizant's Executive Vice President and Chief Legal and Corporate Affairs Officer, allegedly conspired to pay a $2 million bribe to obtain a permit to open an office facility in India. They are charged in a twelve-count Indictment:

Count 1 Conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act ("FCPA"), 18 U.S.C. § 371

Count 2–4 Violations of the anti-bribery provisions of the FCPA, 15 U.S.C. § 78dd-1 & 78ff(c)(2)(A).¹

Counts 5–11 Falsification of Cognizant's books and records, 15 U.S.C. §§ 78m(b)(2)(A), 78m(b)(5), 78ff(a).

Count 12 Circumvention of and failure to maintain internal accounting controls, 15 U.S.C. §§ 78m(b)(2)(B), 78m(b)(5), 78fcf(a).

All substantive counts, as is common, cite 18 U.S.C. § 2, as well.

Before the Court are motions by Defendant Coburn (DE 58, 59) and Defendant Schwartz (DE 57) to dismiss certain counts of the Indictment, for a bill of particulars, and for miscellaneous or alternative relief. The government has filed a consolidated response (DE 61) and the Defendants have filed replies (DE 65, 66). The Court heard oral argument on the motions on January 28, 2020. I decide them as follows.

I. Motion to Dismiss Counts 2, 3, 4, and 12

The era of technical pleading is long past (and was already long past when now-aging jurists began their legal careers). It is worth returning to first principles and reminding ourselves of the simple requirement of Rule 7(c)(1), Fed. R. Crim. P., that the Indictment "be a plain, concise, and definite written statement of the essential facts constituting the offense charged."² Accordingly, an indictment is sufficient if it (1) contains the elements of the offense charged, (2) sufficiently apprises the defendant of what he must be prepared to meet, and (3) allows the defendant to later plead a former acquittal or conviction in the event of a subsequent prosecution. United States v. Kemp , 500 F.3d 257, 280 (3d Cir. 2007). Defendants are correct that the meaning of those factors may vary with the complexity of the case, but not to the point that the factors undermine or defeat themselves. "[N]o greater specificity than the statutory language is required so long as there is sufficient factual orientation to permit the defendant to prepare his defense and to invoke double jeopardy in the event of a subsequent prosecution." Id. (quoting United States v. Rankin , 870 F.2d 109, 112 (3d Cir. 1989) ).³

A. Schwartz Motion to Dismiss Counts 3 & 4

Defendant Schwartz asserts that the face of the Indictment does not clearly charge him in Counts 3 and 4, leading him to suspect that the grand jury may not have charged him.⁴ The issue, as he sees it, arises from a chart at the end of paragraph 2:

 COUNT APPROXIMATE MEANS AND INSTRUMENTALITIES OF
                DATE INTERSTATE AND INTERNATIONAL
                COMMERCE
                  Two       April 21, 2014    COBURN email to SCHWARTZ, CC#1, and
                                              CC#2 requesting a call the next morning to
                                              follow up from their discussion in their
                                              April 21, 2014 call
                  Three     May 20, 2014      COBURN email to CC#1 and others
                                              instructing CC# 1 to continue to freeze
                                              certain payments to the Construction
                                              Company
                  Four      March 13, 2015    COBURN email to CC#1 and others
                                              authorizing Cognizant to pay the
                                              Construction Company for certain false
                                              change order requests in connection
                                              with the KITS Campus
                

In violation of Title 15, United States Code, Sections 78dd -l and 78ff(c)(2)(A), and Title 18, United States Code, Section 2. (Indictment at 20.) All of this, says Schwartz, fails to clarify what he is charged with. Schwartz's name appears in the chart as a party to the email referenced in Count 2, but only Coburn's name appears in the emails referenced in Counts 3 and 4.

The Indictment, I find, is clear enough. There is more to it than the chart.

Paragraph 2, the charging language of Counts 2–4, is a single, extended sentence that concludes with the chart. That single sentence begins as follows, charging both defendants:

2. On or about the dates set forth below, in the District of New Jersey and elsewhere, the defendants,

GORDON J. COBURNandSTEVEN SCHWARTZ,

....

(Indictment at 19.) The listing of full names, capitalized, in bold type, and set off from the other text, is consistent with drafting conventions in this District. It signifies that those named are the charged defendants. That impression is confirmed by the punctuation. The names Gordon J. Coburn and Steven Schwartz appear between commas, immediately following the words "the defendants." Grammatically, this is an appositive, like "our first President, George Washington, ...." The two noun phrases (NP) "the defendants" and "Gordon J. Coburn and Steven Schwartz" are thus presented as equivalents. All of tins is not wholly inconsistent with Schwartz's contentions (they could both be defendants, but not in every count), but it does establish that both are charged, unless some strong contrary indication should appear.

Following the names of Coburn and Schwartz, paragraph 2 alleges "each being an officer, director" (etc.) of an issuer, "did willfully use the mails and means and instrumentalities of interstate commerce corruptly in furtherance of" a bribe to a foreign official. That language, quoted only in part here, tracks the language of the FCPA.

Coburn and Schwartz, then, are the subject of the verb phrase (VP) "did willfully use ...." The inclusion of "each" tends to emphasize or clarify that what follows applies to both defendants, not to just one.⁵ Thus the essential charging language alleges that "each" of the two defendants "did willfully use the mails and means and instrumentalities of interstate commerce." Whether Mr. Schwartz actually did so, of course, will only be revealed by the evidence; it is charged, however, that he did.

The chart, then, does not undermine the initial language of Paragraph 2—clearly charging both defendants—that precedes it. Rather, the chart

(a) fulfills the placeholder promise of Paragraph 2 that the "dates" on which the two named defendants used the means of interstate commerce would be "set forth below" (Indictment at 19 line 3), and

(b) gives content to the statement that Coburn and Schwartz conducted the bribery scheme "as follows." (Id. at 20 line 6.)⁶

The chart uses the defendants’ names only in connection with identifying a relevant email. There is no column for "DEFENDANT," as in Counts 5–11. See n.6, supra. Coburn's name is used adjectivally ("COBURN email"); Schwartz is named as an email recipient ("to SCHWARTZ"). This is not charging language as such; it simply specifies the particular emails to which the charging language applies.

All of that said, we arrive at the nub of Schwartz's argument. In the chart, Schwartz is alleged to have personally been a party only to the email in Count 2, and not to those in Counts 3 and 4. The chart is thus allegedly incompatible with—or at least confusing in relation to—the theory that both defendants are charged in all three counts.

Considered against the relevant legal background, however, the allegations of the chart are clear enough. The government soundly argues that "use" of the means of interstate commerce encompasses participation in a bribery scheme where it is reasonably foreseeable that interstate emails would be used—what may be called the Pereira foreseeability rule.⁷ Even from the facts alleged in the conspiracy count (which are incorporated in Counts 2–4, see ¶ 1), such foreseeability may easily be inferred—if nothing else, it is clearly alleged that these defendants, from within the United States, were directing acts to be performed in India. Thus "use" presents an issue of fact, not of the Indictment's validity.

In addition, Counts 2–4 cite 18 U.S.C. § 2, which criminalizes an accomplice's participation by means of aiding, abetting, counseling, commanding, inducing, procuring, or causing the commission of an offense. Any such accomplice stands in the shoes of a principal as a matter of law.⁸

In addition, Schwartz, alleged to be a conspirator in Count 1, may be held responsible for his coconspirator Coburn's acts in furtherance of the conspiracy. See 3d Cir. Model Jury Instructions (Criminal) 6.18.371K; see also Salinas v. United States , 522 U.S. 52, 63–64, 118 S. Ct. 469, 477, 139 L.Ed.2d 352 (1997). Indeed, that quasi-agency doctrine may extend so far as to impose...