United States v. Hollnagel
| Decision Date | 19 August 2011 |
| Docket Number | No. 10 CR 195,10 CR 195 |
| Parties | UNITED STATES OF AMERICA, Plaintiff, v. BRIAN HOLLNAGEL, BCI AIRCRAFT LEASING, INC., CRAIG PAPAYANIS, JASON R. HYATT, WILLIAM HATAMYAR, JEFFREY MEYER, MARTIN COLLIER, and ROBERT CARLSSON, Defendants. |
| Court | U.S. District Court — Northern District of Illinois |
AMY J. ST. EVE, District Court Judge:
Pursuant to Federal Rule of Criminal Procedure 12(b)(3)(B), Defendant Brian Hollnagel ("Hollnagel") and Defendant BCI Aircraft Leasing, Inc. ("BCI") have filed a motion to dismiss Counts Two through Eleven of the Superseding Indictment as duplicitous. Specifically, Hollnagel and BCI allege that these counts are duplicitous because they fail to charge Defendants with participating in one unitary scheme.1 For the reasons discussed below, the Court denies the motion.
On September 8, 2010, a grand jury returned a twenty-one count superseding indictment (the "Superseding Indictment") naming seven individual defendants - Brian Hollnagel, CraigPapayanis, Jason R. Hyatt, William Hatamyar, Jeffrey Meyer, Martin Collier, Robert Carlsson - and one corporate defendant, BCI Aircraft Leasing, Inc. The Superseding Indictment charges wire fraud, in violation of 18 U.S.C. § 1343 (); false statements in connection with an application to obtain a loan and a line of credit, in violation of 18 U.S.C. § 1014 (count twelve); bribery or attempted bribery in an attempt to influence the business and transactions of Bridgeview Bank, in violation of 18 U.S.C. § 215(a)(1) (); obstruction of justice, in violation of 18 U.S.C. § 1512 (); and perjury, in violation of 18 U.S.C. § 1623 (count eighteen). The sixty-five page Superseding Indictment also contains forfeiture allegations.
Defendants' motion pertains to Counts Two through Eleven of the Superseding Indictment. Count Two charges Defendants Hollnagel, BCI Aircraft, Papayanis, Hyatt, Hatamyar, Meyer, and Collier with a long-term scheme to defraud investors and financial institutions of money and property through, among other things, bribe payments to obtain loans, misrepresentations regarding investments, misappropriation of money raised for particular purposes, commingling of funds, and concealment efforts, including the creation and production of allegedly fraudulent court ordered accountings and the deletion of data from hard drives that had been subpoenaed by the Securities and Exchange Commission ("SEC"). Count Two alleges a long-term fraudulent financing scheme to defraud investors, financial institutions, and others from 2000 to mid-February 2009.
Counts Two through Eleven charge separate wire transactions in furtherance of the fraud scheme charged in Count Two. These counts are summarized as follows:
+------------------------------------------------------------------------------------------------------------------------------+
¦Count Number ¦Charge ¦Defendants Charged ¦Date/Contents of Wire Transaction ¦
+--------------+------------------+--------------------+-----------------------------------------------------------------------¦
¦ ¦Wire ¦Hollnagel BCI ¦$1,200 ¦
¦II ¦Fraud-violating ¦ ¦ ¦
¦ ¦18 USC 1343 § 2 ¦Papayanis Meyer ¦December 1, 2005 ¦
+--------------+------------------+--------------------+-----------------------------------------------------------------------¦
¦ ¦Wire ¦Hollnagel BCI ¦$1,100 ¦
¦III ¦Fraud-violating ¦ ¦ ¦
¦ ¦18 USC 1343 § 2 ¦Papayanis Meyer ¦February 2, 2006 ¦
+--------------+------------------+--------------------+-----------------------------------------------------------------------¦
¦ ¦Wire ¦Hollnagel BCI ¦$294,500 ¦
¦IV ¦Fraud-violating ¦ ¦ ¦
¦ ¦18 USC 1343 § 2 ¦Papayanis ¦September 28, 2005 ¦
+--------------+------------------+--------------------+-----------------------------------------------------------------------¦
¦ ¦Wire ¦Hollnagel BCI ¦$80,000 ¦
¦V ¦Fraud-violating ¦ ¦ ¦
¦ ¦18 USC 1343 § 2 ¦Papayanis ¦January 13, 2006 ¦
+--------------+------------------+--------------------+-----------------------------------------------------------------------¦
¦ ¦Wire ¦Hollnagel BCI ¦ ¦
¦VI ¦Fraud-violating ¦ ¦$500,000 October 25, 2005 ¦
¦ ¦18 USC 1343 § 2 ¦Papayanis Hyatt ¦ ¦
+--------------+------------------+--------------------+-----------------------------------------------------------------------¦
¦ ¦Wire ¦Hollnagel BCI ¦$300,000 ¦
¦VII ¦Fraud-violating ¦ ¦ ¦
¦ ¦18 USC 1343 § 2 ¦Papayanis Hyatt ¦September 27, 2005 ¦
+--------------+------------------+--------------------+-----------------------------------------------------------------------¦
¦ ¦ ¦Hollnagel ¦ ¦
¦ ¦Wire ¦ ¦Email Analysis of 2004-5 Investments & Analysis of 2004-6 Investments ¦
¦VIII ¦Fraud-violating ¦BCI ¦ ¦
¦ ¦18 USC 1343 § 2 ¦ ¦September 6, 2007 ¦
¦ ¦ ¦Collier ¦ ¦
+--------------+------------------+--------------------+-----------------------------------------------------------------------¦
¦ ¦ ¦Hollnagel ¦ ¦
¦ ¦Wire ¦ ¦ ¦
¦IX ¦Fraud-violating ¦BCI ¦Email Amended Analysis of 2004-5 Investments September 17, 2007 ¦
¦ ¦18 USC 1343 § 2 ¦ ¦ ¦
¦ ¦ ¦Collier ¦ ¦
+--------------+------------------+--------------------+-----------------------------------------------------------------------¦
¦ ¦Wire ¦Hollnagel BCI ¦ ¦
¦X ¦Fraud-violating ¦ ¦$1,182,400.67 July 8, 2005 ¦
¦ ¦18 USC 1343 § 2 ¦Hatamyar ¦ ¦
+--------------+------------------+--------------------+-----------------------------------------------------------------------¦
¦ ¦Wire ¦Hollnagel BCI ¦ ¦
¦XI ¦Fraud-violating ¦ ¦$67,599.33 July 8, 2005 ¦
¦ ¦18 USC 1343 § 2 ¦Hatamyar ¦ ¦
+------------------------------------------------------------------------------------------------------------------------------+
I. The Parties and Other Key Entities2
Defendant BCI was a privately owned Illinois corporation with an office originally in Naperville, Illinois and later, in Chicago, Illinois. (R. 46, Superseding Indictment at 1, P1b.) BCI and its related limited liability companies were in the business of buying, selling, and leasing commercial airplanes. (Id.) BCI financed its operations through loans from financial institutions and also through offering and selling investment interests in limited liability companies (the "Investment LLCs") which it managed. (Id. at 7, P2ai.) While the terms of each Investment LLC varied, generally BCI offered prospective investors an investment interest in a particular Investment LLC. BCI led prospective investors to believe they indirectly would acquire beneficial ownership of a specific commercial aircraft on lease to a specific commercial airline, which eventually would be released, refinanced, and/or sold. (Id. at 7, P2aii.) Generally, the terms of such an agreement would be that: 1) the prospective investor would invest along with BCI in...
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