United States v. Reich, Docket No. 06-1445-cr.

• Decision Date: 02 March 2007
• Docket Number: Docket No. 06-1445-cr.
• Citation: 479 F.3d 179
• Parties: UNITED STATES of America, Appellee, v. Perry REICH, Defendant-Appellant.
• Court: U.S. Court of Appeals — Second Circuit

479 F.3d 179

UNITED STATES of America, Appellee, v. Perry REICH, Defendant-Appellant.

Docket No. 06-1445-cr.

United States Court of Appeals, Second Circuit.

Argued: January 26, 2007.

Decided: March 2, 2007.

Amy Busa, Assistant United States Attorney (Roslynn R. Mauskopf, United States Attorney, Eastern District of New York, David C. James, Assistant United States Attorney, on the brief), Brooklyn, NY, for appellee.

Mark M. Baker (Benjamin Brafman, Karen A. Newirth, on the brief), Brafman & Associates, P.C., New York, NY, for defendant-appellant.

Before KEARSE and SOTOMAYOR, Circuit Judges, and KOELTL, District Judge.^*

SOTOMAYOR, Circuit Judge.

Defendant-appellant Perry Reich appeals from the March 31, 2006 and the May 1, 2006 amended judgment of the United States District Court for the Eastern District of New York (Garaufis, J.), convicting him, following a jury trial, of one count of corruptly obstructing a judicial proceeding, in violation of 18 U.S.C. § 1512(c)(2), one count of forging a judge's signature, in violation of 18 U.S.C. § 505, and one count of making a false statement to a federal officer, in violation of 18 U.S.C. § 1001(a)(2), in connection with his fabrication of a court order. Reich challenges his conviction on all three counts, his sentence to twenty-seven months imprisonment, and the district court's March 10, 2006 denial of his motions for a judgment of acquittal, for a new trial, and for bail pending appeal, United States v. Reich, 420 F.Supp.2d 75 (E.D.N.Y.2006). Reich raises five issues on appeal: (1) that there was insufficient evidence to establish that his conduct would have the "natural and probable effect" of obstructing the lawsuit, such that a conviction for obstruction of justice under 18 U.S.C. § 1512(c)(2) was inappropriate; (2) that the jury should have been instructed to find, and evidence was required to establish, an intent to defraud under 18 U.S.C. § 505; (3) that it was error to permit the government to cross-examine Reich's character witness by asking about an allegedly "private" unauthorized change to his law partner's life insurance policy; (4) that there was insufficient evidence to establish that he made a false statement to a government agent; and (5) that the district court improperly applied a "special skills enhancement" in calculating Reich's sentence under the United States Sentencing Guidelines Manual ("U.S.S.G." or "Guidelines"). We disagree with all of Reich's arguments on appeal and affirm his conviction on all counts.

BACKGROUND

The following account is drawn from the evidence adduced at trial before Judge Nicholas G. Garaufis.

The Ryan Beck Lawsuit

Sometime before the activity that gave rise to Reich's criminal conviction, Reich, who is a lawyer, commenced through counsel an arbitration proceeding against a brokerage firm he alleged had mishandled his account. This firm was subsequently acquired by Ryan Beck & Co. ("Ryan Beck"), another brokerage firm, and Reich amended his arbitration claim to include Ryan Beck as a respondent. In July 2002, Ryan Beck filed a lawsuit in the Eastern District of New York, seeking to enjoin Reich and several other defendants, also former investors who had filed arbitration claims (collectively, the "investor-defendants"), from arbitrating against it. Ryan Beck & Co. v. Fakih, No. 02 Civ. 4052 (E.D.N.Y.) ("Ryan Beck v. Fakih" or the "Ryan Beck lawsuit").² The case was assigned to Chief Judge Edward R. Korman, who referred the preliminary injunction motion to Magistrate Judge Roanne L. Mann; eventually, the parties agreed to have Magistrate Judge Mann preside over the entire case. See Order, Ryan Beck v. Fakih, No. 02 Civ. 4052 (E.D.N.Y. Nov. 7, 2002) (Docket Entry No. 49).³

In September 2002, Magistrate Judge Mann issued an order denying Ryan Beck's motion for a preliminary injunction staying arbitration, and on June 4, 2003, she issued another order denying Ryan Beck's motion for reconsideration of that decision. See Order, Ryan Beck v. Fakih, No. 02 Civ. 4052 (E.D.N.Y. Sept. 23, 2002) (Docket Entry No. 28); Order, Ryan Beck v. Fakih, No. 02 Civ. 4052 (E.D.N.Y. June 4, 2003) (Docket Entry No. 83) (the "June 3 Order").⁴ Because the June 3 Order did not resolve Ryan Beck's outstanding summary judgment motion, however, Ryan Beck's attorney, Joel Davidson ("Davidson"), of the law firm Davidson & Grannum, filed an application for a writ of mandamus in the United States Court of Appeals for the Second Circuit to compel Magistrate Judge Mann to issue a ruling.

The Forged Order

On June 17, 2003, at approximately 11:10 a.m., Davidson & Grannum's law office received a four-page fax transmission that purported to be, but was not, an order issued by Magistrate Judge Mann ("the forged Order"), which was dated June 17, 2003, and bore Magistrate Judge Mann's fax header and signature. The forged Order directed that "[t]he orders denying the preliminary injunction are recalled and vacated, and defendant Fakih and its counsel are enjoined from proceeding with the arbitration hearing against Ryan Beck and the brokers." It also recused Magistrate Judge Mann from further proceedings in the case, stating that she had discussed the suit with Chief Judge Korman, "who recommended to me that I recuse myself from the case and return the matter to him.... Given the manner in which I have handled this case, a reasonable person would believe that I was not impartial, and recusal logically follows." Finally, the order returned the matter to Chief Judge Korman and stated:

The parties shall notify Chief Judge Korman by letter whether they consent to further proceedings before a different Magistrate Judge, whether the matter can be decided on the basis of the current submissions without the necessity for additional argument, and whether ... sanctions may be imposed against and [sic] of the defendants.

The forged Order bore similarities to the June 3 Order: It had the same caption final page, and fax header, and was faxed at the same time of day. The date of the forged Order appeared to have been changed by hand, and one part of the text alignment was skewed. The forged Order also contained information that only someone familiar with the Ryan Beck lawsuit would know; for example, it included details of the June 3 Order and contained a phrase—"mixing apples and oranges"— that Davidson occasionally used during the litigation. Telephone records produced at trial indicated that at 11:08 a.m. on June 17, a call lasting several minutes was initiated to Davidson's fax machine from Reich's home using a pre-paid calling card.

Davidson's secretary found the forged Order in the fax tray shortly after 11 a.m., and handed it to another lawyer at Davidson's firm; that attorney faxed the forged Order to Davidson, who was at home. In response to the forged Order, Davidson wrote a letter to the Second Circuit withdrawing his application for a writ of mandamus, which he understood the forged Order to render moot. Because the forged Order purported to enjoin only one of the investor-defendants from arbitrating, however, Davidson also contacted Chief Judge Korman to inquire how he should proceed regarding the remaining investor-defendants. In addition, Davidson circulated the forged Order to various arbitration panels and attorneys representing Ryan Beck in other jurisdictions.

Magistrate Judge Mann learned of the forged Order sometime in the afternoon of June 17 or June 18, when the attorney for one of the investor-defendants called her chambers to say he had heard that she had issued a decision. On June 18, she signed an order stating that the forged Order was fraudulent, had not been issued by the court, and should not be relied on in any manner. See Order, Ryan Beck v. Fakih, No. 02 Civ. 4052 (E.D.N.Y. June 23, 2003) (Docket Entry No. 110). She also contacted the Second Circuit so that it would not rely on the forged Order for purposes of considering the mandamus application, and notified the United States Attorney's Office for the Eastern District of New York of the forged Order. The United States Attorney's Office referred the matter to the Federal Bureau of Investigation ("FBI") for investigation.

Reich's Pretrial and Trial Statements

After the FBI's initial investigative efforts yielded phone records linking Reich's phone number to the fax transmission of the forged Order, FBI agents interviewed Reich at the end of July 2003. Reich denied having any contact with Davidson on June 17, and denied using prepaid telephone cards. The agents again spoke to Reich in August, when they searched his home pursuant to a warrant. Reich stated that he may have contacted Davidson regarding a confidentiality agreement. When an agent asked Reich why telephone records would reflect a several-minute connection between his phone and the Davidson fax machine, Reich stated that he may have dialed the fax line inadvertently and hung up. To explain why such an inadvertent call would last over three minutes, he stated that his phone did not always disconnect the line immediately upon hanging up.

The following March, Reich and his attorney met with the FBI agents for a proffer session. When asked whether he had called Davidson, Reich reiterated that he had dialed the Davidson fax by mistake, and again denied owning or using calling cards, although he said he had purchased one for his girlfriend. The agents offered Reich the opportunity to state that he had sent the forged Order as a "joke." According to Reich's testimony at trial, he responded: "No, I told them distinctly no matter what, no matter [what] the consequences ... were to me I said I would never, never say that. I didn't do it. As I sit here today, I will never say that I did something I didn't do."

At trial, Reich continued to deny creating the forged Order. He stated that he had tried to call Davidson's phone line to discuss a discovery issue and engage in settlement discussions, but dialed Davidson's...