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United States v. Holovacko

United States District Court, D. New Jersey

July 26, 2017

UNITED STATES OF AMERICA,
v.
JESSEJ.HOLOVACKO, Defendant.

          MEMORANDUM OPINION

          MICHAEL A. Shipp United States District Judge

         This matter comes before the Court upon Defendant Jesse J. Holovacko's ("Defendant") Motion for New Trial pursuant to Federal Rule of Criminal Procedure 33(a) ("Rule 33(a)") and Motion for Judgment of Acquittal pursuant to Federal Rule of Criminal Procedure 29(c) ("Rule 29(c)"). (ECF No. 58-1.) The United States of America (the "Government") filed opposition (ECF No. 60), and Defendant replied (ECF No. 61). The Court has carefully considered the parties' submissions and decides the matter without oral argument. For the reasons set forth below, the Court denies Defendant's Motion for New Trial and Motion for Judgment of Acquittal.

         I. Background Defendant was indicted on seven counts, including six counts of wire fraud and one count of investment advisor fraud. (Indictment, ECF No. 13.) The trial began on April 24, 2017 and concluded on April 28, 2017. (ECF Nos. 40, 41, 42, 43, 46.) On April 28, 2017, the jury returned a guilty verdict on all seven counts of the indictment. (Jury Verdict 1-3, ECF No. 50.) While presenting its case, the Government called as a witness Jeremy Hutson (the "Witness"), the Senior Vice President/Senior Internal Investigator for Bank of America Merrill Lynch ("Merrill Lynch"). (Apr. 26, 2017 Tr. 50:21-25, ECF No. 55.) During the direct examination of the Witness, the Government asked about an investigation he conducted involving Merrill Lynch and the investment accounts of Defendant and Stanley Klimek (the "Client"). (Apr. 26, 2017 Tr.53:2-91:20.)

         During his testimony, the Witness stated that he initiated the internal investigation after "[r]eceiv[ing] a request for investigation or an alert" from Merrill Lynch's Internal Fraud Detection Unit ("IFDU"). (Id., at 53:6-54:15.) The Witness reviewed "the contents of the report from [IFDU], " reviewed the Client and Defendant's account activity, and "submitted a request to the cyber forensics department [at Merrill Lynch] for assistance with [his] review." (Id. at 54:5-15, 55:21-56:2.) "After reviewing what cyber forensics had come back with, " the Witness again researched the activity in the Client and Defendant's accounts. (Id. at 56:24-57:3.) The Witness explained that he researched the account activity "[b]ecause the activity that [he] saw in both accounts pretty much answered a lot of questions that [he] was researching." (Id. at 57:4-8.) Based on his research of the accounts, the Witness testified that "[i]t was pretty obvious to [him] that there was misappropriation of assets." (Id. at 57:9-12.) Defense counsel shortly thereafter[1]requested a sidebar and objected to the testimony, arguing that it "render[ed] an opinion as to the ultimate issue of whether [Defendant] in fact misappropriated assets." (Id. at 59:5-7.) The Court heard defense counsel's argument and determined that the testimony was not improper opinion testimony.[2] (Id. at 61:12-63:20.)

         II. Parties' Positions

         A. Motion for New Trial

         Defendant argues that "[t]he [Government's improper introduction of [the Witness's] opinion testimony severely prejudiced . . . [D]efendant and warrants a new trial." (Def.'s Moving Br. 2.) Defendant contends that the Witness's testimony regarding misappropriation of assets was lay opinion because the Witness was not offered as an expert. (Id.) As such, Defendant asserts that this lay opinion violated Federal Rule of Evidence 701 ("Rule 701") because it "was not founded on personal knowledge[, ] but based, in part, upon a review [of] work product of third parties. . . . which contained inadmissible hearsay." (la. at 3.) Defendant further argues that the Witness's testimony "regarding 'misappropriation of assets' amounted to directing the jury to find a misappropriation." (Id.) According to Defendant, the Witness's testimony that the misappropriation was "pretty obvious" unfairly prejudiced Defendant. (Id.)

         The Government argues that the Witness's testimony was admissible under Rule 701 because it "was rationally based on [the Witness's] perception." (Gov't's Opp'n Br. 3, ECF No. 60.) The Government contends that the Witness "testified regarding his personal research and review of. . . [D]efendant's bank and brokerage account records as well as [the] Client's bank records." (Id.) In addition, the Government argues that the Witness's testimony "was also based on his role as an internal investigator for [Merrill Lynch] and his experience conducting internal investigations for [Merrill Lynch]." (Id. at 4.) As such, the Government argues that the Witness "had particularized knowledge by virtue of his experience and testified from personal knowledge of documents he reviewed." (Id.)

         The Government further asserts that, even if the Witness's testimony was inadmissible, Defendant has not shown that the testimony was unduly prejudicial or that it had a substantial influence on the jury's deliberations and the outcome of the trial. (Id. at 5.) Additionally, the Government states that it never referenced the Witness's conclusion of misappropriation during summations, and "instead emphasize[d] that the jury's verdict depended on whether the jury credited or discredited the Client's testimony and/or . . . [D]efendant's testimony regarding why the Client gave . . . [D]efendant the cashier's checks." (Id. at 6.) Accordingly, the Government argues that if admission of the testimony was in error, it did not have a substantial influence on the jury's deliberations or outcome of the trial. (Id.)

         B. Motion for Judgment of Acquittal

At trial, Defendant moved for a judgment of acquittal under Rule 29(c) and now renews his Rule 29(c) motion. (Def.'s Moving Br. 4.) Defendant relies upon the arguments presented in his original Rule 29(c) motion. (Id.) In opposition, the Government summarizes the evidence introduced against Defendant at trial, and argues that the evidence adequately supports the jury's verdict of guilty beyond a reasonable doubt on all counts. (Gov't's Opp'n Br. 6-7.)

         III. Legal Standard

         A. Motion for New Trial

Pursuant to Rule 33(a), "the court may vacate any judgment and grant a new trial if the interest of justice so requires." Fed. R. Crim. P. 33(a). A court should grant a motion for a new trial only when "there is a serious danger that a miscarriage of justice has occurred-that is, that an innocent person has been convicted." United States v. Hamilton, No. 05-876, 2010 WL 1027412, at *1 (D.N.J. Mar. 18, 2010) (quoting United States v. Brennan,326 F.3d 176, 189 (3d Cir. 2003)). When an error has allegedly been committed at trial, "[a] new trial is required on this basis only when 'the [] errors, when combined, so infected the jury's deliberations that they had a substantial influence on the ...


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