USA. v. Helbling

• Decision Date: 14 March 2000
• Docket Number: No. 99-5051,99-5051
• Citation: 209 F.3d 226
• Parties: (3rd Cir. 2000) UNITED STATES OF AMERICA, v. WILLIAM F. HELBLING, Appellant
• Court: U.S. Court of Appeals — Third Circuit

Page 226

209 F.3d 226 (3rd Cir. 2000)

UNITED STATES OF AMERICA, v. WILLIAM F. HELBLING, Appellant

No. 99-5051

UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT

Argued September 9, 1999

Filed March 14, 2000

On Appeal from the United States District Court for the District of New Jersey (D.C. Criminal No. 96-cr-00740) District Judge: Honorable William G. Bassler

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Tonianne J. Bongiovanni, Esq. (ARGUED) Office of Federal Public Defender 972 Broad Street Newark, NJ 07102 Counsel for Appellant

George S. Leone, Esq. Elizabeth S. Ferguson, Esq. (ARGUED) Office of United States Attorney 970 Broad Street, Room 700 Newark, NJ 07102 Counsel for Appellee

Before: BECKER, Chief Judge, ROTH, and RENDELL, Circuit Judges

OPINION FOR THE COURT

RENDELL, Circuit Judge.

William F. Helbling appeals from his conviction and sentence. A jury found that Helbling embezzled funds from a profit sharing plan covered by the Employee Retirement Income Security Act ("ERISA") to pay the operating expenses of three failing companies he owned, and engaged two lawyers to help him by creating false documents indicating that the withdrawals had been part of a lawful Employee Stock Ownership Plan ("ESOP") conversion. Helbling's appeal raises numerous issues relating to the timeliness of his indictment, the sufficiency of the evidence presented at trial, and the calculation of his sentence.¹ We will affirm his conviction and sentence in all aspects. An understanding of the facts of the case is a necessary foundation for a discussion of the issues he raises.

I.

On December 18, 1996, a federal grand jury returned a thirty-five-count indictment against Helbling. The indictment included: (1) one count of conspiracy to embezzle employee pension plan funds and falsify ERISA documents (18 U.S.C. S 371); (2) four counts of embezzlement of employee pension plan funds from an ERISA covered plan (18 U.S.C. S 664); (3) eighteen counts of falsifying documents required by ERISA (18 U.S.C.S 1027); (4) six counts of wire fraud (18 U.S.C. S 1343); and (5) six counts of mail fraud (18 U.S.C. S 1341). The mail fraud counts were dismissed during trial.² The jury convicted Helbling of twenty-seven of the remaining twenty-nine counts.

Before trial, Helbling filed a motion to dismiss the indictment on the basis that the indictment was not timely. On July 22, 1996, Helbling had signed an agreement waiving his statute of limitations defense. However, Helbling argued to the District Court that the waiver was invalid because he had been coerced into signing it by fraud and misconduct. Helbling also argued that the government had failed to investigate allegations he had made about third parties to a degree Helbling says he believed the waiver agreement required. The waiver agreement specifically allowed Helbling "to present for investigation" his allegations which included claims that a number of individuals purposely injured his companies. After an evidentiary hearing, the District Court denied the motion in part by finding that the government had fulfilled its part of the bargain. The Court found that on October 15, 1996, government agents met with Helbling and accepted from him documents he believed supported his claims. Before ceasing their investigative activities, the agents reviewed the documents and spoke with another agent who had previously investigated related complaints.

Trial commenced on May 13, 1998. At trial, the government offered proof that Helbling illegally withdrew money from the profit sharing plan covered by ERISA, used the funds to pay the operating costs of three companies he owned, and had two lawyers help him withdraw the money and legitimize the withdrawals by creating backdated documents to reflect that the plan had been lawfully converted into an ESOP. Helbling did not contest many of the background facts presented at trial including his control of the three companies, his administration of the plan, or the financial transactions themselves. Helbling instead argued that the government failed to establish that he had acted with the requisite criminal intent, and that the government witnesses were lying. In his pro se brief, Helbling explains that he acted on the advice of counsel who told him that he could withdraw funds from the plan and document the ESOP conversion later as long as he had secured the consent of the company's board of directors.

To prove its case, the United States presented numerous documents and several witnesses. The witnesses included Helbling's alleged co-conspirators, the two lawyers, Gerald S. Susman and Stephen Sokolic, who testified to the false ESOP conversion, Laura Scurko, who testified about the financial transactions and explained that ERISA covered the plan, Barry Penn, Susan Kramer and Donald Mayle, who testified to the forgery of two important documents, and John Grikis and Barry Katz who managed the plan investments at NatWest Bank and Oppenheimer & Co. Several of the plan participants also testified.

The witnesses explained that Helbling was the president, chief executive officer, and sole shareholder of three companies, Micro-Technology Co. (and its subsidiary MicroProducts Engineering Co.), Scranton Electronics, Inc., and Yardley Group, Inc., which Helbling ran as one company, and the administrator of Micro-Products Engineering Company Profit Sharing Retirement Plan. The plan was funded exclusively by Micro-Products. Ed Wisniewski, a plan participant and long-time employee, testified that the plan was established by a previous owner in 1965 to provide retirement income as an incentive to salaried employees to remain with the company. Laura Scurko, an attorney who was appointed trustee of the plan in a civil suit brought by the plan participants, testified as a lay witness and explained that the plan was covered by ERISA. She pointed out that the plan documents stated that the plan was amended and restated in 1976 to comply with the Employee Retirement Income Security Act of 1974. As of March 1991, the plan had assets of approximately $625,000 and covered ten salaried employees. The plan's assets were held by NatWest Bank which also acted as trustee to the plan.

Helbling's companies were manufacturing companies that relied heavily upon military contracts. In May 1990, at Helbling's direction, the companies filed for Chapter 11 reorganization. In February 1992, the Bankruptcy court converted the Chapter 11 bankruptcy proceedings into a Chapter 7 liquidation because the companies failed to provide the Court with the required monthly filings. The companies subsequently ceased business. While in bankruptcy, the companies continued to struggle because they lacked sufficient cash flow and were unable to procure new military contracts.

In February 1991, Helbling directed John Grikis, then a trust officer at NatWest, to transfer the plan's assets to Oppenheimer & Co. Helbling's companies had been contacted by Barry Katz, an Oppenheimer fund manager, in late 1990. The funds were transferred on March 13, 1991 after Grikis received a letter sent by Katz indicating that Oppenheimer would assume responsibility for the funds. The day after the transfer to Oppenheimer, Helbling moved $125,000 to an account at Farmers & Mechanics Bank and used it to pay operating expenses. In July, after conversations with Katz during which Helbling explained that he wanted to remove more money, Helbling converted the account to a margin account and borrowed $350,000 against the plan's assets. Katz approved the conversion after receiving a fax supposedly signed by Barry Penn, a lawyer, indicating that Micro-Product's plan permitted the company to borrow against the plan's assets. The money was again used to pay operating expenses. At trial, Penn and his secretary, testified that the letter was a forgery. They explained that Helbling, who had been Penn's client, twice asked Penn to write the opinion letter, first in person and later by fax, but that Penn refused because he was not familiar with pension law or the profit sharing plan. Subsequently, Helbling instructed Katz to close the account and sent Katz a letter, dated August 29, 1991, which confirmed that the plan had been converted into an ESOP. Helbling subsequently withdrew money from the account in the form of a check for $55,300 on September 6, 1991, and a wire transfer for $29,700 on September 16, 1991. Helbling withdrew a final amount of $3,500 on January 3, 1992.

Attorneys Gerald Susman and Stephen Sokolic were the government's two key witnesses. Both testified pursuant to plea agreements. Susman testified first. He explained that he first spoke with Helbling in the early part of 1990 after Helbling had been referred to him by Arnold Kaminer, who provided health insurance for Helbling's companies, to help Helbling establish a trust to hold his life insurance. During the summer of 1990, Susman completed some estate planning work for Helbling. Kaminer confirmed that he referred Helbling to Susman for estate planning, and also testified that he mentioned the possibility of an ESOP in a conversation with Helbling in February of 1991.

Susman testified that Helbling called him again in March, and July, of 1991. During the conversation in March, Helbling asked Susman if he knew of any sources of financing because his companies were having financial trouble. During the conversation in July, Helbling asked Susman about withdrawing money from a profit sharing plan. Sometime around August, 20, Helbling called Susman again. This time, according to Susman, Helbling told him that he had made the large March and July withdrawals from the Micro-Products plan.

Susman testified that he "was flabbergasted" when Helbling told him in August of the large withdrawals. Susman had thought that Helbling had been asking about removing money from his own personal...