US v. Finkielstain, 89 Cr. 0009 (MBM).

• Citation: 718 F. Supp. 1187
• Decision Date: 03 August 1989
• Docket Number: No. 89 Cr. 0009 (MBM).,89 Cr. 0009 (MBM).
• Parties: UNITED STATES of America v. Jacobo FINKIELSTAIN, a/k/a "Jackie," and Salomon Kaplan, a/k/a "Salo," Defendants.
• Court: U.S. District Court — Southern District of New York

718 F. Supp. 1187

UNITED STATES of America v. Jacobo FINKIELSTAIN, a/k/a "Jackie," and Salomon Kaplan, a/k/a "Salo," Defendants.

No. 89 Cr. 0009 (MBM).

United States District Court, S.D. New York.

August 3, 1989.

Robert J. Cleary and Elliot R. Peters, Asst. U.S. Attys., and Benito Romano, U.S. Atty., S.D.N.Y., New York City, for U.S.

T. Barry Kingham and Daniel R. Lenihan, Curtis, Mallet-Prevost, Colt & Mosle, New York City, for defendant Jacobo Finkielstain.

OPINION AND ORDER

MUKASEY, District Judge.

Defendant Jacobo Finkielstain has moved to bar the government from presenting at trial the depositions of Luis Lecueder and Andreas Blauer, taken and videotaped pursuant to Fed.R.Crim.P. 15. He claims that both witnesses testified based on documents that were not available to him, thereby denying him confrontation rights guaranteed by the Sixth Amendment and discovery rights guaranteed by rule and statute, and violating evidentiary rules. For the reasons set forth below, the motions are granted in part and denied in part.

To the extent relevant to these motions, the indictment in this case charges a complex scheme whereby Finkielstain, as owner of the Central National Bank of New York ("CNB"), and his alleged co-conspirators, would enter into repurchase agreements, called "repos," without the authorization of the account holders in whose names these transactions were entered into, and then funnel the proceeds of the transactions to Swiss and Panamanian accounts, and thence to entities controlled by Finkielstain. In addition, the indictment charges that Finkielstain and others induced CNB to extend credit to several corporations without disclosing Finkielstain's interest in them. Among them were three companies called Lismore, Ballarat and Grafton.

I. The Lecueder Testimony

Lecueder is a public accountant in Montevideo, Uruguay who testified that he had created the three shell corporations referred to above pursuant to Uruguayan law, and that after meeting Finkielstain in December 1984, he sold those corporations to that defendant. (Lecueder Tr. 13-15) Lecueder testified that he then continued to do accounting work for those three entities. (Lecueder Tr. 16) Notwithstanding that the letterhead of the three companies used Lecueder's office address as their own, Lecueder testified that none of the three in fact was headquartered in his office and that he addressed requests for information and bills to an office Finkielstain maintained in Buenos Aires. (Lecueder Tr. 16-17, 23-26)

Lecueder was interviewed in Montevideo by the government in July 1988. According to a memorandum of that interview, he related the facts set forth above. (Peters Aff. Exh. A) He declined, however, to provide to the government documents of the three corporations (Peters Aff. ¶ 4), apparently on advice of counsel (Lecueder Tr. 44-46), and subsequently confirmed at his deposition that he would not turn those documents over to the government but would turn them over to someone he thought was authorized to receive them. (Lecueder Tr. 11-12, 31-32) Although Lecueder said initially that he was uncertain in view of the controversy surrounding these corporations whether he would turn the documents over to Finkielstain (Lecueder Tr. 12), he later testified as follows: "If Dr. Kingham counsel for Finkielstain assumes representation of Mr. Finkielstain and authorizes me to turn over those documents, I am willing to provide them forthwith." (Lecueder Tr. 32) The fencing between the government and Finkielstain culminated in an exchange that warrants substantial quotation:

MR. PETERS: ... Mr. Kingham, I believe the witness indicated he would be willing to provide documents if you as a representative of Mr. Finkielstain would ask him for those documents. Are you willing to make that request?

MR. KINGHAM: My understanding is that Mr. Finkielstain is not an owner or a director of any of these corporations and so I'm telling you, Mr. Peters, it was very cute, but my response is that I do not have authority from an owner or a director of the corporations to make that request.

When asked again by government counsel to make the request, with the suggestion that the witness would comply simply on the basis that the request came from Finkielstain, defense counsel addressed Lecueder as follows:

MR. KINGHAM: Mr. Lecueder, let me explain something to you, please. I am not authorized by any owner or director of Lismore, Ballarat, Grafton or any other corporation to request of you the production of documents. The request that I make for the production of documents was made pursuant to Federal Rule of Criminal Procedure 15(c), which is a law with which you are obviously not familiar.

THE WITNESS: I do not know.

Defense counsel then summarized the witness' position as he understood it, suggesting that the witness was willing to turn over documents only to an owner or a representative of the owners of the corporations, and was willing to give the documents to Finkielstain only because the witness believed Finkielstain to be such. Lecueder repeatedly tried to interrupt defense counsel's rendition of Lecueder's own views, but defense counsel insisted that inasmuch as no question was pending, it would be improper for the witness to speak. Eventually, the following exchange took place:

THE WITNESS: Mr. Finkielstain may be the owner and, personally, with the relationship that I had with him, I would provide information to you if you are Mr. Finkielstain's representative because I have the conviction — I presume that you are.

MR. KINGHAM: I am his representative, but I represent to you that I am advised as Mr. Finkielstain's representative that he is neither an owner nor a director of any of these companies. If you are prepared to provide documents to me given that understanding, I would be pleased to receive them.

THE WITNESS: If you ask me for them on behalf of Mr. Finkielstain, I can give them to you.

MR. KINGHAM: I would be happy to receive them. The understanding is the documents will remain between us and the fact that you provide them to me is not to be used as any evidence to suggest in any way that Mr. Finkielstain is either an owner or director of these companies or that Mr. Finkielstain was an owner or director of these companies in 1985.

THE WITNESS: But those documents would be to prove what are the balance sheets of the above mentioned companies?

MR. KINGHAM: You heard what I said, sir. The documents I am requesting are all of the documents in your possession or the possession of your office that relate in any way to Mr. Finkielstain, Ballarat, Lismore, Grafton or any other company which you sold or furnished to Mr. Finkielstain.

THE WITNESS: And what are those documents good for?

MR. KINGHAM: Those documents, sir, have been requested in connection with this litigation. The judgment of how they are to be used, if at all, remains with me and perhaps with the judge if we seek to use them at trial.

THE WITNESS: Then I will think whether or not I should do that.

(Lecueder Tr. 62-64) Ultimately, the witness adhered to his original refusal to supply documents, for which he cited discretionary rules of professional confidentiality allegedly applicable in Uruguay. (Lecueder Tr. 46)

Although Lecueder originally was to have testified in Montevideo, his deposition was taken in New York when he came to the United States in April on personal business, but he has said he remains unwilling to return to this country to testify at trial. Before the venue of Lecueder's Rule 15 deposition was changed from Montevideo to New York, he apparently compiled a summary or list of entries in his diary and travel records in order to refresh his recollection as to the dates of meetings, those in attendance and, to a limited extent, the content of meetings. There were four such entries. (DX DD — Kingham Aff. Exh. C) Lecueder brought a copy of this one-page summary with him to New York, and consulted it before although not during his testimony. (Lecueder Tr. 46-50).

Finkielstain's motion centers on the corporate documents Lecueder did not produce and on the diaries and other records underlying the memorandum he prepared to refresh his recollection. In particular, Finkielstain argues that the "real" witness against him was not so much Lecueder as the documents he did not produce — the corporate records of Lismore, Ballarat and Grafton, and the diaries and travel records. Accordingly, Finkielstain reasons, that non-production violated his confrontation right under the Sixth Amendment. Further, he argues that failure to produce the documents renders Lecueder's testimony inadmissible under Fed.R.Evid. 612, which provides in pertinent part as follows:

If a witness uses a writing to refresh memory for the purpose of testifying either —

(1) while testifying, or

(2) before testifying, if the court in its discretion determines it is necessary in the interests of justice, an adverse party is entitled to have the writing produced at the hearing, to inspect it, to cross-examine the witness thereon, and to introduce in evidence those portions which relate to the testimony of the witness.... If a writing is not produced or delivered pursuant to order under this rule, the court shall make any order justice requires, except that in criminal cases when the prosecution elects not to comply, the order shall be one striking the testimony or, if the court in its discretion determines that the interests of justice so require, declaring a mistrial.

Finally, Finkielstain contends that Lecueder was testifying to the content of documents not produced and accordingly that his testimony violates the best evidence rule as embodied in Fed.R.Evid. 1002.¹

Finkielstain's confrontation argument is deficient both factually and legally. There are three essential points made by Lecueder's testimony: (i) that he sold the three shell corporations to Finkielstain, (ii) that he billed Finkielstain and not anyone...