Free Response to Motion - District Court of Arizona - Arizona

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

PAUL K. CHARLTON United States Attorney District of Arizona RACHEL C. HERNANDEZ Arizona State Bar No. 016543 GARY M. RESTAINO Arizona State Bar No. 017450 Assistant U.S. Attorneys Two Renaissance Square 40 N. Central Avenue, Suite 1200 Phoenix, Arizona 85004-4408 Telephone (602) 514-7500 [email protected] [email protected]

UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA United States of America, Plaintiff, v. Robert Shinn, and Richard Nail, Defendants. UNITED STATES' RESPONSE TO DEFENDANTS' MOTION TO PRECLUDE EXPERT TESTIMONY CR04-0820-PHX-FJM

The United States, through counsel undersigned, responds in opposition to the motions of 17 defendants Nail and Shinn to strike the government's noticed experts. Defendants contend that 18 the government's notice (dkt # 94) fails to describe the opinions, the bases for the opinions or 19 the qualifications of the witness. As described more fully below, the government's notice 20 complies with the Scheduling Order and Fed. R. Crim. P. 16. 21 A. 22 Defendants conspired to pitch a scam presentation for a major credit card to consumers with 23 deficient credit, arranged with a third party processor to debit consumers' accounts, received 24 wire transfers from the third party processor, laundered the money and ultimately failed to 25 provide consumers with the benefit of the bargain they believed they had made. An indictment 26 was unsealed on October 4, 2004 describing the above conduct. On November 8, 2004, the 27 government, in its opening discovery letter, disclosed its intent to use expert testimony at trial: 28 Background

Case 2:04-cr-00820-FJM

Document 168

Filed 10/17/2005

Page 1 of 4

1 2 3 4 5

Pursuant to Rule 16(a)(1)(F) & (G), the government provides notice that it may use expert testimony at trial in four areas: 1) financial analysis; 2) modus operandi of telemarketing operations; 3) technical computing evidence, including but not limited to the use of a predictive dialer in telemarketing operations; and 4) tax withholding requirements for employers. This letter serves as notice of the government's intent to use this evidence at trial. The government reserves the right to supplement this and all other requests. (Discovery Letter, attached as Exhibit A, at 3.) As the case progressed, the government refined

6 its decision on experts, and, pursuant to the Scheduling Order, noticed five topics for experts 7 on August 1, 2005, in addition to nine possible witnesses within those categories: Charles E. 8 Floyd, Jr. as to ACH Commerce; an additional expert from a major credit card company as to 9 risk factors associated with chargebacks; Wendy Spaulding as to the financial analysis; Special 10 Agents Nora Kollas and/or Julie Halferty as to a modus operandi of telemarketing; Don Powers, 11 Special Agent Tracy Daun or a then-unidentified employee tax specialist as to tax withholding 12 requirements; and John Gorjazyk of the Phoenix Police Department as to a handwriting 13 exemplar. 14 No defendant expressed any concern with respect to the disclosures until September 30, 15 2005. Since that time, in two separate disclosures, the government has fully identified (and 16 narrowed) its list of witnesses, and has provided a curriculum vitae as to most experts. To date, 17 the government still intends to disclose a curriculum vitae as to Ginger Bergman (the designated 18 expert from Visa on risk factors), Agents Kollas and/or Halferty of the FBI and John Gorjazyk 19 of the Phoenix Police Department. As detailed in footnote one below, the government also 20 intends to provide additional details on the anticipated opinion testimony of Ms. Bergman. 21 On or after September 30, 2005, several defendants noticed their own experts. Defendant 22 Desiderio (a non-movant in this motion) filed a one-paragraph description as to two potential 23 experts similar in form and substance to the government's notice, and also produced a 24 curriculum vitae. The other defendants, including both movants, filed boilerplate notices devoid 25 of the information required in the reciprocal discovery provisions of Fed. R. Crim. P. 16(b). 26 27 28
2

Case 2:04-cr-00820-FJM

Document 168

Filed 10/17/2005

Page 2 of 4

1 B. 2

Legal Analysis The expert disclosure requirements "are not intended to create unreasonable procedural

3 hurdles". Fed. R. Crim. P. 16, comment to 1993 amendments, reprinted in Federal Criminal 4 Code and Rules (2005) at 108. Defendant's hyper-technical objections to the government's 5 expert disclosures, combined with their own vague boilerplate, contravene the Rules's 6 expectations. 7 Several defendants appear to perceive that the government has noticed federal agents as

8 experts to "bolster" their testimony. (E.g. Shinn Notice at 1:23-25.) This perception is incorrect. 9 The government noticed several witnesses as experts, including those who are not expected to 10 give "opinion" evidence, in an exercise of caution rather than to bolster their testimony. Indeed, 11 it is not even the practice in this District for a lawyer to request that the Court certify a witness 12 as an expert in front of the jury. Several witnesses, including the financial analyst, the modus 13 operandi agents and the tax specialist, are not even anticipated to provide opinions.1 The 14 government notices them because they nonetheless have specialized expertise that they will use 15 in presenting factual testimony. 16 C. 17 18 19 20 21 22 23 24 The government does anticipate that Chuck Floyd and Ginger Bergman will provide true opinions on electronic funds transactions, and of course that John Gorjazyk will testify that 25 defendant Desiderio's handwriting is consistent with the handwriting on the tax exhibits. The government notice describes Floyd's opinions (to include the rationale behind special rules for 26 telephone authorizations and the risk factors in telephone authorizations and chargebacks). The government anticipates a more detailed description of Ms. Bergman's opinion with respect to 27 risk factors for fraud inherent in the chargeback ratio. 28
3
1

Conclusion For the foregoing reasons, the Court should deny defendants' motion.

Case 2:04-cr-00820-FJM

Document 168

Filed 10/17/2005

Page 3 of 4

1 2 3 4 5 6 7 8 9

Respectfully submitted this 17th day of October, 2005. PAUL K. CHARLTON United States Attorney District of Arizona s/ Gary M. Restaino RACHEL C. HERNANDEZ GARY M. RESTAINO Assistant U.S. Attorney

CERTIFICATE OF SERVICE 10 I hereby certify that on this date, I electronically transmitted the attached document to the 11 Clerk's Office using the CM/ECF System for filing and transmittal of a Notice of Electronic Filing to the following CM/ECF registrants: Bruce Blumberg, Jeanette Alvarado, Ivan Mathew, 12 Tom Hoidal, Greg Parzych and Michael Bresnehan. 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28
4

Case 2:04-cr-00820-FJM

Document 168

Filed 10/17/2005

Page 4 of 4