July 8, 2015
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 John Gleeson, granting a §2255 motion, vacated petitioner's guilty plea in light of the government's misleading pre-plea disclosures, which omitted any mention of "warrantless wiretaps" under the Foreign Intelligence Surveillance Act amendments of 2008. Magistrate Judge Gary R. Brown invited plaintiffs, whose house was damaged by Hurricane Sandy, to apply for sanctions as compensation for defendant insurer's deceptive engineering report, and ordered further discovery relating to such conduct in all Sandy-related cases.
Judge Eric N. Vitaliano applied a variety of factors in ordering a restitution award of $2,000 against a particular defendant in a child pornography case involving one victim and hundreds of other defendants sharing culpability for her losses. And Judge Raymond J. Dearie declined to dismiss plaintiffs' federal claims against the City of New York for failing to discipline a police officer who proceeded to participate in mob-related murders.
In Hasbajrami v. United States, 13 CV 6852 (EDNY, Oct. 2, 2014), Judge Gleeson granted petitioner's motion under 28 U.S.C. §2255 to vacate his guilty plea and reopened the underlying criminal case, where the government failed to advise petitioner until after his sentence that its trial evidence would have included "warrantless wiretap" information. Thus, in deciding to plead guilty, petitioner had been "misled about an important aspect of his case."
Petitioner pleaded guilty in April 2012 to providing material support for terrorists and, in January 2013, received a 15-year sentence, the statutory maximum. He later filed a §2255 motion, arguing that the statute of conviction was unconstitutionally vague. In February 2014, the government disclosed for the first time that some of the evidence in the case had been derived from warrantless wiretapping "pursuant to the Foreign Intelligence Surveillance Act of 1978 [FISA], as amended, 50 U.S.C. §1881a." Authority under §1881a was conferred by the FISA Amendments Act of 2008 (FAA), which permits the government to gather information from electronic communications by people outside the United States who are not U.S. citizens or permanent residents. In contrast to traditional FISA authority, the FAA does not require a warrant for each data collection.
Before the guilty plea, the government had not revealed the use of warrantless wiretaps under the FAA. Rather, it notified petitioner solely that its evidence came from "electronic surveillance and physical searches" conducted pursuant to FISA, without reference to the 2008 "warrantless wiretap" amendments.
As the court noted, petitioner's guilty plea posed barriers to his collateral attack on his conviction. Slip op. 3-6. But in light of the government's disclosures after the §2255 motion was filed, petitioner asked to withdraw the plea.
Though the question was "close," the court pointed to several circumstances tipping the balance in petitioner's favor. "Since FISA and the FAA are governed by precisely the same notice requirement, the government's provision of FISA notice without FAA notice gave the overwhelming-and false-impression that no FAA-obtained information figured in the government's case." Slip op. 7. At oral argument petitioner's counsel represented that, prior to his decision to plead guilty, petitioner had asked them if warrantless wiretaps had generated any evidence. When they answered no, petitioner was more willing to plead guilty. In short, petitioner was misled about a point that bore on his plea decision.
Additionally, this was no "idiosyncratic" interest on petitioner's part. "Warrantless wiretapping has been controversial," with few rulings on its legality. Expressing no view on the merits of the issue, the court observed that the government had prevented petitioner from knowing that an argument was available. And petitioner could perhaps have sought "to suppress the FISA-obtained evidence not because the FAA is unconstitutional in general, but because of some other infirmity in its application to this particular case." Slip op. 7-8.
The court therefore granted the §2255 petition, as modified by petitioner's request for vacatur of his sentence and guilty plea. Slip op. 9.
In a decision issued under the joint caption In re: Hurricane Sandy Cases, 14 CV 41, and Raimey v. Wright National Flood Insurance Co., 14 CV 461 (EDNY, Nov. 7, 2014), Magistrate Judge Brown granted relief, pursuant to Fed. R. Civ. P. 37, for deceptive discovery practices by a defendant insurer and its counsel.
Raimey is one of more than 1,000 cases commenced in the Eastern District related to the 2012 storm known as Hurricane Sandy. A committee of magistrate judges appointed to manage such cases passed a series of Case Management Orders (CMOs) to expedite discovery. CMO #1 called for production of any materials "relating to an assessment of the claimed loss," and CMO #3 clarified that this was not limited to reports or materials prepared by testifying experts. Slip op. 1, 15.
Plaintiffs in Raimey learned that defendant had failed to produce drafts of an engineer's report regarding their house. At hearing, the court confirmed that the drafts and related materials should have been produced under the CMOs. It also determined that the final engineer's report produced by defendant-which, on its face, was based on the engineer-author's physical inspection-was the product of undisclosed editing by a second engineer, a process defendant described as "peer review." The second, reviewing engineer, who had not visited the premises, essentially directed the engineer-author, in his final report, to reverse his initial conclusion that the storm had caused structural damage. Slip op. 8-9.
In the course of defending their "peer review" process, defendant introduced evidence suggesting that it was a widespread practice "across the field of engineering." Slip op. 13. Describing the practice as "reprehensible," Brown ordered relief not only in the Raimey action, but in all Hurricane Sandy cases in the district.
In Raimey, defendant was precluded from relying upon the testimony of any expert other than the author of the final report the defendant had produced, and plaintiff was authorized to make application to recover from defendant's counsel the costs and fees incurred in connection with the hearing and related motions. Slip op. 22-25. In the other Sandy-related cases, defendants were directed to produce, within 30 days, "any drafts, redlines, markups, reports, notes, measurements, photographs and written communications" related to any relevant report of property damage, "whether such documents are in the possession of any defendant or any third party" subject to defendants' control. Slip op. 26.
In United States v. DiLeo, 12 CR 260 (EDNY, Nov. 4, 2014), Judge Vitaliano determined the amount of restitution to be paid to one of the victims depicted in pornographic material downloaded by defendant.
An agent with Homeland Security Investigations downloaded a video containing child pornography from defendant's computer through a peer-to-peer file-sharing system. Following a search of defendant's home, agents searched defendant's computer and found several videos containing child pornography. One of the videos depicted Vicky, the claimant for restitution here.
Defendant pleaded guilty to one count of possessing child pornography. Under 18 U.S.C. §2259, a sentencing court must order restitution to an identified victim of child pornography, for the full amount of the victim's past and continuing losses, after the government shows that defendant was the proximate cause of those losses. The Supreme Court in Paroline v. United States, 134 S. Ct. 1710 (2014), established the rule for causation in child pornography restitution cases:
Where it is impossible to trace a particular amount of those losses to the individual defendant by recourse to a more traditional causal inquiry, a court properly applying §2259 should order restitution in an amount that comports with the defendant's relative role in the causal process that underlies the victim's general losses. Id. at 1727.
Slip op. 5.
Vitaliano concluded that the losses Vicky had suffered and continued to suffer, including future psychological counseling, educational and vocational counseling, lost part-time income during school, lost future earnings and out-of-pocket costs, totaled $1.1 million, and that defendant's criminal conduct was a proximate cause of her continuing loss. Slip op 9.
The court turned to the proper amount of restitution attributable to defendant, recognizing that there were numerous culpable parties with varying degrees of culpability and the total restitution could not exceed the total actual loss suffered by the identified victim. Applying the Paroline factors, the court found:
- Four hundred seventy five defendants had been ordered to pay restitution totaling more than $10 million to Vicky and Vicky had received $599,164 to date;
- The government could not make a "reasonable prediction" of the number of defendants who would be prosecuted in the future;
- The government had not produced any evidence that defendant had distributed the images to anyone except law enforcement;
- Defendant did not participate in the initial production of the video; and
- Defendant possessed only a single video of Vicky.
Slip op. 9-14.
The court divided the total losses of $1.1 million by the total number of defendants to date-476-arriving at a per-defendant quotient of $2,277. The government suggested enhancing that number to $3,500; defendant proposed modifying it to $1,000; probation suggested $3,000; and Vicky's attorneys sought $150,000. Vitaliano, expressing frustration at the lack of guidance from the Supreme Court and Congress, decided on a reasonable number for restitution:
In any event, beginning with the simple division quotient of $2277.42 and modifying it slightly to correct for additional offenders currently in, or soon to be in, the prosecution pipeline, and considering that this is an ordinary case in which the record establishes that defendant's total role in the trafficking of the victim's images was his possession of a single video containing those images, the Court will enter a restitution award in the amount of $2000.
Slip op. 20.
Failure to Discipline Officer
In Pipitone v. City of New York, 06 CV 145 (EDNY, Sept. 30, 2014), Judge Dearie denied the city's motion for summary judgment to dismiss plaintiffs' federal claims, but granted summary judgment on plaintiffs' state law claims in an action seeking to hold the city liable for failure to discipline NYPD Detective Louis Eppolito, who subsequently participated in murders of plaintiffs' relatives on behalf of organized crime.
In 1984, Eppolito was investigated by NYPD Internal Affairs after the FBI discovered 36 confidential NYPD Intelligence Division reports at the home of a mobster under indictment for heroin trafficking. The reports were traced back to Eppolito, who then made sworn statements contradicted by his supervisors and witness logs.
A disciplinary hearing in April 1985 was highly unusual because (1) an inexperienced junior lawyer tried the Police Department case; (2) evidence was submitted by stipulation rather than live testimony; (3) much of the evidence against Eppolito was omitted, including the presence of Eppolito's fingerprints on the reports; (4) during summation Eppolito's lawyer misstated evidence without contradiction; and (5) the Police Department lawyer declined to make a closing argument.
The hearing officer recommended that Eppolito be cleared because the Police Department had failed to meet its burden of proof. Police Commissioner Ben Ward approved the recommendation the day after he received it. Eppolito was promoted in 1987 and continued working as a detective until he retired in 1990.
In 1994, the Mollen Commission, appointed by Mayor David Dinkins, revealed serious issues with the NYPD's anti-corruption attitudes and policies. There was a widespread belief within the NYPD that disclosure of corruption would be viewed as a management failure. Thus it was more important to avoid uncovering serious corruption than to eradicate corruption.
After he was cleared, Eppolito initiated a relationship with the Lucchese crime family through his cousin. As part of that relationship, Eppolito participated both directly and indirectly in a series of murders, along with fellow detective Steven Caracappa. Eppolito and Caracappa were indicted in March 2005, following cooperation by their contact within the Lucchese family.
Plaintiffs, survivors of those murdered, brought claims pursuant to 42 U.S.C. §1983, under Monell v. Department of Social Services of the City of New York, 436 U.S. 658 (1978), seeking compensation from the City of New York, Eppolito and Caracappa. Under Monell, a municipality may be held liable for the unconstitutional actions of its employees when a plaintiff shows a failure to supervise or discipline such employees along with the municipality's deliberate indifference to the improper actions.
In the U.S. Court of Appeals for the Second Circuit, §1983 claims accrue when a plaintiff knows or has reason to know of the injury on which his action is based. To determine the timeliness of plaintiffs' claims, Dearie applied the "diligence-discovery rule," used when the government hides the acts giving rise to claims or when plaintiff could not have discerned the facts or cause of the injury at the time it was inflicted.
Despite press coverage suggesting links between the murders and errant police officers, Dearie found no basis in the news articles to suggest a causal connection between the city and the murders or to attribute knowledge of alleged police involvement to plaintiffs. "Plaintiffs' generalized, inchoate suspicions" were not related to the actual conspiracy between Eppolito and Caracappa, and the court found it doubtful "whether any diligent investigation of those vague suspicions would have turned up any solid grounds to believe that the NYPD was causally linked to the murders." Slip op. 26.
As to the substance of the Monell claim for municipal liability, the court found powerful evidence in the Mollen Report "that there was a custom and practice within the police department of tolerating corruption to avoid bad publicity" and that this custom was "persistent, widespread, and emanating 'from top commanders, including the police commissioner.'" Slip op. 27. The Mollen Report provided sufficient evidence that "the supervisory and disciplinary failures described therein constituted a municipal policy for Monell purposes and that the City's handling of the Eppolito matter was reflective of that policy." Slip op. 27-28.
As Dearie also found, "the flawed 1985 disciplinary process and the attitudes and practices described in the Mollen Commission report provide separate grounds upon which a jury might find deliberate indifference." Slip op. 31. Finally, a jury could find that Eppolito's 1985 acquittal was due to the department's desire to avoid bad press at the expense of tolerating corruption; and that Eppolito's subsequent behavior arose from his acquittal because Eppolito committed his first murder for the Lucchese family less than a year after his acquittal; that the acquittal emboldened Eppolito; and that he could not have performed the murders and passed confidential police information to Lucchese family members unless he was still a detective. As to the murders committed after Eppolito retired, a jury could conclude that Caracappa was emboldened as well by the Police Department's failure to discipline Eppolito. Slip op. 32-37.
The court dismissed the state law claims as time-barred, rejecting plaintiffs' argument that the statute of limitations was tolled by CPLR §215(8) and EPTL §5-4.1, which provide that the statute of limitations for tort and wrongful death claims runs one year beyond the termination of a criminal action against the "same" defendant. The term "same defendant" did not apply to the uncharged employers of criminal defendants. Slip op. 37-39.