November 13, 2014

New York Law Journal / Written by: Harvey M. Stone, Richard H. Dolan

This column reports on several significant, representative decisions handed down recently in the U.S. District Court for the Eastern District of New York. Judge Jack Weinstein discussed the "unconscionable" five-year statutory minimum sentence applicable to a defendant who, as an adolescent, accessed child pornography on his computer. Judge John Gleeson granted a habeas petition based on various improprieties relating to the use of certain prejudicial testimony after it was supposedly stricken. Judge Pamela K. Chen, affirming a Bankruptcy Court decision, imposed sanctions on the creditor, and Judge Joseph A. Bianco denied a motion to dismiss claims for overtime and vacation pay brought by an employee of a married couple convicted for harboring indentured servants.


In United States v. C.R., 09 CR 155 (Sept. 26, 2013), Judge Weinstein commented on the "unnecessary cruelty" of a five-year statutory minimum sentence of a young offender for accessing child pornography through an automatic file-sharing computer program. The court made its remarks in ordering resentencing after the U.S. Court of Appeals for the Second Circuit held that the original sentence had to be increased by 30 months to conform with the statutory minimum.

The defendant pleaded guilty to distributing child pornography while he was an adolescent. The automatic file-sharing program through which he accessed the material gave others access to his home computer. He did not produce, sell or deliberately exchange pornography. While awaiting sentencing, he attended college, worked part-time and underwent intense psychiatric out-patient treatment. "Credible evidence and expert testimony established that there was no threat of his producing child pornography, viewing it in the future, or acting out in a physical way against any child or other person." Slip op. 3.

Weinstein initially sentenced defendant, with "reluctance," to 30 months in a prison medical treatment center. The Second Circuit ordered, "pursuant to statutes it held binding," that the sentence be increased by another 30 months, resulting in a term "likely to be spent in the general prison population." Slip op. 1.

"Such a long sentence," Weinstein noted, "is unjust." "After release from prison, C.R. will be severely restricted as a convicted sex offender in where, and with whom, he can live, work and recreate for up to life." The effect of harsh minimum sentences in many cases "is, effectively, to destroy young lives unnecessarily." As Weinstein added, the "ancient analog" of such modern destruction of young lives "was physically sacrificing them to ancient gods for the supposed benefit of society." For example, "Leviticus 18:21 (King James ed.) warns: '[T]hou shalt not let any of thy [children] pass through the fire to Molech.'" Slip op. 2.

Article III judges have a duty to prevent injustices. By issuing these comments, Weinstein has now "at least" brought the matter "to the government's and public's attention, so that in due course, in our caring democracy, future injustices of this kind will be avoided."

Any normal person who has seen child pornography, the court stated, must be "horrified." But there is a span of culpability in these cases. Least culpable is "the passive adolescent who saves or automatically passes on what he observed through automatic file sharing, with no mens rea as to possible harm." Slip op. 3-4. When, as here, there is "no danger of acting out," a mandated five-year sentence, followed by lifetime restraints, is "shockingly divergent from the American criteria for defensible penology."

As the court further observed, there is a "growing consensus" among those who enforce our criminal law that mandatory minimum sentences in cases like this are unconscionable. Slip op. 4-9. The Supreme Court, moreover, has shown heightened sensitivity to "the unconstitutional cruelty involved in unnecessarily severe sentences of adolescents." "Statutes should not embrace such punishment even if the Constitution does not prohibit them." Slip op. 8-9.

Habeas Relief Granted

In Williams v. Artus, Superintendent, Wende Correctional Facility, 12 CV 5541 (EDNY, Sept. 4, 2013), Judge Gleeson found that petitioner's trial and direct appeal in state court on murder charges were so flawed as to warrant habeas relief.

In 2001, Eric Williams was the driver in a high-speed car chase, pursuing a woman Williams believed had cheated him by consuming $300 worth of cocaine that she was supposed to have sold on his behalf. Williams was accompanied by his girlfriend, Rebecca Madigan. One of them fired a shot at the car being pursued, causing it to crash, killing one of the passengers and severely injuring two others. The key issue at trial was who fired the shot.

The prosecutor elicited from Madigan's testimony that Williams had told her "this isn't the first time he's killed somebody. That he's done it before." Upon motion for a mistrial, the trial judge struck the testimony that Williams had committed a prior, uncharged killing, but also allowed the prosecutor to pursue the subject further — evidently believing that it would "soften the blow" to have Madigan testify that she knew only what Williams had told her (and did not know if he had, in fact, killed before).

In Gleeson's view, this undermined the court's instruction that Madigan's testimony in this regard "has no part in this case," and effectively admitted the very testimony that the judge intended to strike. The problem was compounded when, during direct and cross-examination of Williams, both counsel returned to Madigan's stricken testimony regarding Williams' alleged admission of a prior killing. Even more notably, the prosecutor referred to the stricken testimony explicitly in her summation, without objection from defense counsel. Slip op. 11-15.

Under the Antiterrorism and Effective Death Penalty Act of 1996, Gleeson could grant relief only if "there is no possibility fair minded jurists could disagree that the state court's decision conflicts with [the Supreme Court's] precedents." Slip op. 23, quoting Harrington v. Richter, 131 S. Ct. 770, 786 (2011). While rejecting various other grounds advanced by Williams, slip op. 43-64, the court found this standard met by: (1) the prosecution's "deliberately eliciting inadmissible evidence of a prior uncharged murder by Williams;" (2) the inadequate curative instructions of the trial court; (3) the cumulative effect of these errors, which led to use of the "stricken" testimony during trial; and (4) the failure of appellate counsel to argue "ineffective assistance" based upon trial counsel's failure to object to the prosecutor's use of the stricken testimony during summation. Slip op. 23-43, 64.

Bankruptcy Appeal

In Baranek v. Baranek, 12 CV 5090 (EDNY, Sept. 11, 2013), Judge Chen affirmed the Bankruptcy Court's decision (1) granting summary judgment to debtor ex-wife with respect to an adversary proceeding brought by creditor ex-husband claiming future debt from the marital house, and (2) imposing sanctions on creditor for filing his frivolous complaint.

The debtor and creditor were married in April 1981 and purchased a house in Suffolk County six years later. In November 2003, creditor commenced a divorce action. In May 2004, a court-ordered home study indicated that the home was in a "state of disrepair" and about to be foreclosed because the couple could not make their mortgage payments. In October 2004, debtor and creditor entered into a stipulation in the divorce action transferring title of the marital residence to the debtor, who was given authority to sell or refinance the home in her own name. The transfer of title was intended to be "in full satisfaction of all claims of equitable distribution" in the divorce action. Debtor subsequently sold the house to her parents and paid off the mortgage with the proceeds. Creditor made a number of efforts in state court to vacate the stipulation, claiming that he signed it under duress.

In July 2011, while this litigation was pending, debtor filed a petition under Chapter 7 of the Bankruptcy Code. She listed creditor's state court claim as "contingent" and "disputed." The trustee concluded that there was no property available for distribution from the estate. Creditor commenced an adversary proceeding seeking exception from discharge for his claim, and the reversal of the transfer to debtor's parents as fraudulent under sections 523(a)(2) and 548 of the Bankruptcy Code, respectively. The Bankruptcy Court granted debtor's motion for summary judgment and imposed sanctions, because the action had been commenced for some improper purpose.

Chen, reviewing the Bankruptcy Court decision de novo, concluded that an exception to discharge under section 523(a)(2) relating to debts arising from fraud, falsity or a materially false statement did not apply here, because creditor would have to show that he relied on omissions in documents from the divorce action when he accepted the stipulation. Creditor alleged that during the divorce proceeding, debtor obtained the transfer of the home to herself by omitting "the fact that she (i) 'is the sole owner and operator of her own corporation Freedom of Speech Inc.,' (ii) 'owns and operates her own independent escort service,' and (iii) 'has judgments of large sums of money filed against individuals'. . . " Slip op. 7

Chen stated: "Creditor has not come forward with a shred of evidence suggesting that he actually relied on these alleged omissions…and his 'version of the events' recounting his reliance on these alleged omissions is, at best, 'wholly fanciful.'" Slip op. 11. Creditor could not have relied on alleged omissions about debtor's continued employment as an escort. The subject had been discussed during the home study in connection with the divorce action and, during that action, debtor found work as a teaching assistant. Similarly, creditor could not have relied on omissions about debtor's ownership of a corporation that no longer existed by the time of the divorce action.

Creditor's claim for fraudulent transfer failed because only the bankruptcy trustee has standing to avoid fraudulent transfers. Creditor did not fall into the two exceptions to this exclusive standing: First, the trustee did not unjustifiably decline to begin a fraudulent transfer action, nor did he consent to creditor's doing so. Second, the extension of standing to creditor would not be in the best interest of debtor's estate.

Finally, Chen affirmed the Bankruptcy Court's imposition of sanctions on creditor. As the court found, the only reason creditor alleged that debtor was still working as an escort was to humiliate and harass her, and the only "apparent purpose [of this 'objectively frivolous' action] is to embarrass and saddle the already-bankrupt Debtor with burdensome and unnecessary costs." Slip op. 15.

Overtime Claims — FLSA

In Litras v. PVM International, 11 CV 5695 (EDNY, Aug. 15, 2013), Judge Bianco denied defendants' motion to dismiss claims for overtime pay under the Fair Labor Standards Act (FLSA) and for vacation pay and retaliation under the New York Labor Law (NYLL). Plaintiff sought overtime pay for working more than 40 hours a week and unused vacation pay at the time of her termination.

Plaintiff was employed by defendants Mahender and Varsha Sabhnani and their companies from March 2000 to April 2010. Plaintiff claims she was terminated because in 2007 she testified against the Sabhnanis in a criminal case where they were convicted of various crimes connected with harboring indentured servants. Plaintiff had discovered they were harboring the servants as virtual slaves in 2007. She continued to help run defendants' perfume business following their convictions until her termination in 2010.

Bianco held that plaintiff's pleadings stated a plausible FLSA overtime claim and that defendants' failure to pay was willful, invoking a three-year, instead of two-year, statute of limitations. Her claim for overtime pay, however, could extend back no more than three years from the filing of the complaint.

The court had previously granted defendants' prior motion to dismiss the FLSA overtime claim for lack of sufficient particularity. Plaintiff attached a chart to the amended complaint alleging the number of hours plaintiff worked each workday, complete with specific dates. Bianco found that to be adequate.

Next, by alleging that she was punished (i.e., terminated) for testifying against her employers in the criminal case, plaintiff sufficiently pleaded a "conspiracy" to violate civil rights under 42 U.S.C. §1985.

Plaintiff also alleged that defendants failed to pay accrued vacation time in violation of the NYLL. The right to paid vacation depends on an express or implied agreement. Bianco found an implied agreement in letters written by plaintiff suggesting arrangements to pay her for vacation days in past years.

Finally, the court upheld plaintiff's claim under section 215 of the NYLL, which prohibits retaliation against an employee for making a complaint about the employer's violation of a provision in the statute. Although the complaint did not explicitly cite to the provision of the NYLL pertaining to harboring of indentured servants, plaintiff did allege that she was compelled to testify against her employers after discovering that they were harboring indentured servants or slaves at their residence. Clearly, then, the violation that triggered plaintiff's section 215 claim was indentured servitude.

Harvey M.  Stone and Richard H.  Dolan are partners at Schlam Stone & Dolan.  Bennette D.  Kramer, a partner of the firm, assisted in the preparation of the article.

[This article is reprinted with permission from the November 8, 2013, issue of the New York Law Journal.  Copyright © 2013 ALM Properties, Inc.  All rights reserved.  Further duplication without permission is prohibited.]