Court filing
NOTICE OF MOTION AND MOTION in Limine to Admit Physical Evidence of Gold Coins and… — USA v. Ayvazyan et al (Dkt. 540)
Record facts
| Court | U.S. District Court for the Central District of California |
|---|---|
| Filed | 2021-06-16 |
U.S. District Court for the Central District of California · No. 2:20-cr-00579-SVW · Doc. 540 · 2021-06-16 · Docket on CourtListener
Summary
The government's motion in limine to admit physical evidence of gold coins and watches seized from the residence of Richard Ayvazyan and Marietta Terabelian, filed June 16, 2021 as Doc. 540 in USA v. Ayvazyan et al, No. 2:20-cr-00579-SVW, in the U.S. District Court for the Central District of California. It states that a search of the Topeka Drive residence in Tarzana on November 5, 2020 yielded approximately 60 gold coins and approximately ten luxury watches, and that jeweler records show 60 gold coins bought for $122,960. The government expects evidence to tie the purchases in part to fraudulent COVID-19 relief loan proceeds, including three watches bought for $11,000, $37,000 and $51,000. It argues the items are relevant, including to Terabelian's stated defense that she "wasn't in on it," and not barred by Rule 403. The motion runs 12 pages.
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TRACY L. WILKISON
Acting United States Attorney
SCOTT M. GARRINGER
Assistant United States Attorney
Chief, Criminal Division
SCOTT PAETTY (Cal. Bar No. 274719)
CATHERINE AHN (Cal. Bar No. 248286)
BRIAN FAERSTEIN (Cal. Bar No. 274850)
Assistant United States Attorneys
Major Frauds/Environmental and Community Safety Crimes Sections
1100/1300 United States Courthouse
312 North Spring Street
Los Angeles, California 90012
Telephone: (213) 894-6527/2424/3819
Facsimile: (213) 894-6269/0141
E-mail:
Scott.Paetty@usdoj.gov
Catherine.S.Ahn@usdoj.gov
Brian.Faerstein@usdoj.gov
DANIEL S. KAHN
Acting Chief, Fraud Section
Criminal Division, U.S. Department of Justice
CHRISTOPHER FENTON
Trial Attorney, Fraud Section
Criminal Division, U.S. Department of Justice
1400 New York Avenue NW, 3rd Floor
Washington, DC 20530
Telephone: (202) 320-0539
Facsimile: (202) 514-0152
E-mail:
Christopher.Fenton@usdoj.gov
Attorneys for Plaintiff
UNITED STATES OF AMERICA
UNITED STATES DISTRICT COURT
FOR THE CENTRAL DISTRICT OF CALIFORNIA
UNITED STATES OF AMERICA,
Plaintiff,
v.
RICHARD AYVAZYAN,
aka “Richard Avazian” and
“Iuliia Zhadko,”
MARIETTA TERABELIAN,
aka “Marietta Abelian” and
“Viktoria Kauichko,”
ARTUR AYVAZYAN,
aka “Arthur Ayvazyan,” and
TAMARA DADYAN,
MANUK GRIGORYAN,
aka “Mike Grigoryan,” and
No. CR 20-579(A)-SVW
GOVERNMENT’S MOTION IN LIMINE TO
ADMIT PHYSICAL EVIDENCE OF GOLD
COINS AND WATCHES SEIZED FROM
DEFENDANTS RICHARD AYVAZYAN’S AND
MARIETTA TERABELIAN’S RESIDENCE
Hearing Date: June 17, 2021
Hearing Time: 9:00 a.m.
Trial Date: June 15, 2021
Location: Courtroom of the
Hon. Stephen V.
Wilson
Case 2:20-cr-00579-SVW Document 540 Filed 06/16/21 Page 1 of 12 Page ID
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“Anton Kudiumov,”
ARMAN HAYRAPETYAN,
EDVARD PARONYAN,
aka “Edvard Paronian” and
“Edward Paronyan,” and
VAHE DADYAN,
Defendants.
Plaintiff United States of America, by and through its counsel
of record, the Acting United States Attorney for the Central
District of California, Assistant United States Attorneys Scott
Paetty, Catherine Ahn, and Brian Faerstein, and Department of
Justice Trial Attorney Christopher Fenton, hereby files this motion
in limine seeking to admit physical evidence of certain gold coins
and luxury watches seized from defendants Richard Ayvazyan’s and
Marietta Terabelian’s residence as part of the government’s
investigation in this case.
This motion is based upon the attached memorandum of points and
authorities, the files and records in this case, and such further
evidence and argument as the Court may permit.
Dated: June 16, 2021
Respectfully submitted,
TRACY L. WILKISON
Acting United States Attorney
SCOTT M. GARRINGER
Assistant United States Attorney
Chief, Criminal Division
/s/
SCOTT PAETTY
CATHERINE AHN
BRIAN FAERSTEIN
Assistant United States Attorneys
CHRISTOPHER FENTON
Department of Justice Trial Attorney
Attorneys for Plaintiff
UNITED STATES OF AMERICA
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MEMORANDUM OF POINTS AND AUTHORITIES
I.
INTRODUCTION
The government respectfully moves in limine for a ruling from
the Court that the government may admit at trial physical evidence
of gold coins and luxury watches seized from the residence of
defendants Richard Ayvazyan (“R. Ayvazyan”) and Marietta Terabelian
(“Terabelian”) on November 5, 2020.
This evidence is directly relevant and highly probative of
material issues in this case, particularly in light of defendant
Terabelian’s multiple assertions in her opening statement that she
“wasn’t in on it.” The high probative value of this evidence is not
substantially outweighed by a danger of unfair prejudice, nor would
it constitute cumulative evidence or waste the jury’s time. To the
contrary, admission of the evidence would obviate the need for
prolonged descriptive testimony regarding the items and allow the
government a more efficient means of presenting highly probative
evidence regarding the items at trial.
More fundamentally, Federal Rule of Evidence 403 does not
require the government to “sanitize its case” or to “tell its story
in a monotone.” United States v. Gartmon, 146 F.3d 1015, 1021 (D.C.
Cir. 1998). The government should be permitted to present “the full
evidentiary force of the case as the [g]overnment chooses to present
it,” Old Chief v. United States, 519 U.S. 172, 186-87 (1997) -
particularly where there is minimal danger of “unfair” prejudice or
other Rule 403 concerns as there is here. For the reasons explained
below, the visual depictions of the gold coins and luxury watches
are an important component of the government’s trial presentation,
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are necessary to rebutting defenses raised in defendants’ openings,
and should be admissible through physical evidence at trial.
II.
RELEVANT BACKGROUND
A.
Gold Coins and Luxury Watches Seized From Topeka Residence
On November 5, 2020, law enforcement executed a federal search
warrant at a $3.25 million mansion located on Topeka Drive in
Tarzana (the “Topeka Residence”) at which defendants R. Ayvazyan and
Terabelian resided. The government’s investigation to that point
had identified the Topeka Residence as having been purchased in the
names of defendants R. Ayvazyan and Terabelian using proceeds from
multiple suspected fraudulent COVID-19 disaster relief loans
obtained in 2020. (See Affidavit, In the Matter of the Search of []
Topeka Drive Tarzana California 91356, No. 2:20-MJ-05282 (“SW
Aff.”), ¶¶ 23 (Under Seal); see also ECF 1, ¶¶ 16-26.)
The investigation also revealed that a substantial portion of
the stolen disaster relief funds had been funneled through various
bank accounts, including a bank account opened in the name of
defendant Terabelian’s father, N.T., after he was deceased, and used
to purchase over $400,000 in goods from jewelers. (SW Aff. ¶ 62.f.;
see also Govt Trial Exhibits (“GEX”) 34, 39.) The stolen disaster
relief funds also were used to purchase luxury watches (that were
delivered to one of defendant R. Ayvazyan’s properties) and other
luxury personal items. (SW Aff. ¶ 62.f; GEX 37, 39.)
During the search of the Topeka Residence on November 5, 2020,
law enforcement seized, among other things, approximately 60 gold
coins. As the evidence at trial will demonstrate, the government
separately obtained records from Piccadilly Jewelers reflecting that
60 gold coins had been purchased purportedly by N.T. for the
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aggregate price of $122,960. (See GEX 39.) The government
anticipates the evidence at trial will show that the funds for this
purchase derived, in part, from the proceeds of two fraudulent
COVID-19 disaster relief loans submitted on behalf of the purported
company “Mod Interiors, Inc.,” both in the name of N.T. (defendant
Terabelian’s then recently deceased father). (See GEX 2.o, 5.m.)
The government has marked the gold coins with a placeholder under
GEX 56 in its exhibit list filed with the Court.
Agents also seized from the Topeka Residence approximately ten
luxury watches, including at least three watches the government was
able to determine based on serial numbers were purchased from a
retailer called Gentleman Timepieces in July and August 2020, for
the prices of $11,000, $37,000, and $51,000, respectively.1 (See GEX
37.) The records from Gentleman Timepieces reflect that defendant
R. Ayvazyan purchased at least five additional luxury watches from
this retailer. (See id.) Similar to the gold coins, the government
anticipates the evidence at trial will show the purchases of at
least three of these luxury watches from Gentleman Timepieces
derived, in part, from fraudulent COVID-19 disaster relief proceeds.
The government also has included in its exhibit list a placeholder
exhibit under GEX 56 for the watches.
1 Defendants moved to suppress the evidence of the luxury
watches and gold coins (in addition to other evidence seized during
the search of the Topeka Residence). The Court denied defendants’
motion to suppress this evidence. (ECF 296.) Even though the Court
ordered the government to return five of the ten watches to
defendants, the Court nonetheless permitted the government to use
evidence of these additional five watches at trial. (See id. at 39-
40.) The government already has returned those five additional
watches to defendants and seeks to admit at trial physical evidence
of the five remaining watches in its possession. The government,
however, has photographs (produced to defendants) of the five
additional watches that it already returned.
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At trial, in addition to the records reflecting the purchases
of much of the evidence described above, the government intends to
offer as physical evidence the 60 gold coins (contained in a bag and
marked as one exhibit) and the five watches that remain in the
government’s possession that were seized from the Topeka Residence.2
B.
Discussion of Gold Coins and Luxury Watches During June
14, 2021 Pretrial Conference
During the pretrial conference on June 14, 2021, in connection
with a discussion regarding jury selection, counsel for defendant
Terabelian stated a concern that photographs of the gold coins and
luxury watches seized from the Topeka Residence could cause, for
some unspecified reason, potential jurors on the panel not to want
to serve on the jury in this case. In response to this concern, the
Court raised the issue as to whether it would be necessary for the
government to show photographs of the gold coins and luxury watches
to the jury in addition to testimony about the seized items. During
the hearing, the government did not provide the Court with a
complete presentation of the relevant factual and legal issues to
allow the Court to conduct a thorough Rule 403 balancing analysis of
this evidence. The government does so now.
III. ARGUMENT
A.
Evidence Regarding the Gold Coins and Luxury Watches is
Relevant Under Rules 401 and 402
Under Federal Rule of Evidence 401, evidence is relevant if
“(a) it has any tendency to make a fact more or less probable than
2 The government also may seek to admit photographs of this
specific evidence that have previously been produced to the defense
and are encompassed within the placeholder for GEX 56 in the
government’s exhibit list.
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it would be without the evidence; and (b) the fact is of consequence
in determining the action.” Fed. R. Evid. 401. Relevant evidence
is presumptively admissible. See Fed. R. Evid. 402.
Physical evidence of the gold coins and luxury watches seized
from defendants R. Ayvazyan’s and Terabelian’s residence are
unquestionably relevant to facts of consequence in this case –
particularly in light of defendant Terabelian’s defense, as
articulated in her opening statement, that she had no knowledge of
any aspects of the charged conduct.
Defendants are charged, among other things, with conspiracy to
commit bank fraud and wire fraud through which they and their
coconspirators obtained millions of dollars in fraudulent loans from
the Paycheck Protection Program (“PPP”) and Economic Injury Disaster
Loan (“EIDL”) program.3 (See ECF 154, Count 1.) The manner and
means of the charged bank/wire fraud conspiracy specifically allege
that defendants spent the fraudulent loan proceeds on, among other
things, “gold coins, diamonds, jewelry, [and] luxury watches,” along
with residential properties and other high-end personal goods
prohibited under the PPP and EIDL programs. (Id., ¶ 31.f.)
Defendants are further charged with a money laundering
3 The Court approved the government’s redacted superseding
indictment for trial, which removes the original paragraph 32 from
the First Superseding Indictment specifying that the alleged charged
bank/wire fraud conspiracy involved at least 151 fraudulent PPP/EIDL
loan applications seeking a total of at least $21.9 million in
proceeds. (See ECF 422-2.) However, the fraudulent loan
applications described in the overt acts of the trial superseding
indictment, standing on their own, add up to more than $3.24
million. To be clear, the loans included in the overt acts are
provided merely as examples of the numerous other fraudulent
PPP/EIDL loans submitted as part of the conspiracy. However,
through just that exemplary subset of loans, the jury will be
considering fraudulent conduct involving millions of dollars.
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conspiracy arising out of their use of the fraudulent PPP/EIDL
proceeds for their own personal benefit. (See id., Count 26.) The
superseding indictment similarly alleges that defendants purchased,
among other things, “gold coins” and “luxury watches” in furtherance
of their conspiracy to launder the proceeds of their fraudulent
scheme. (Id., ¶ 53.c.) Thus, not only were the gold coins and
luxury watches among the fruits of defendants’ conspiracy to commit
bank fraud and wire fraud (not to mention the substantive wire fraud
and bank fraud counts also alleged in the superseding indictment),
but also they constitute the means through which defendants
laundered a portion of the proceeds of the fraud.
Evidence of the appearance of the gold coins and luxury watches
also is directly relevant to defendant Terabelian’s stated defense
that she “wasn’t in on it.” Defendant will be asking the jury to
believe that she lived with her husband, defendant R. Ayvazyan, as
he amassed millions of dollars in proceeds from fraudulent PPP/EIDL
loans, spending the money on lavish items (including the 60 gold
coins and multiple luxury watches) found in her own house, all
without her knowledge or raising any concerns in her mind.
Testimony only tells half the story. The physical appearance of
these opulent items - including a $51,000 18-karat rose gold watch
and a stack of gold coins that, by their description alone, may not
be recognizable items to some members of the jury - is highly
probative of the items’ significant value, and defendant
Terabelian’s knowledge of that fact. The government needs to be
able to show the jury the actual seized items, so the jury can
evaluate the credibility of her defense that she was just a
“homemaker” and had no reason to suspect her husband may have been
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engaging in financial fraud.
Thus, the visual evidence of the gold coins and luxury watches
is directly relevant to the charges the jury will be considering and
highly probative of the fruits and means of the charged conspiracies
and defendant Terabelian’s state of mind.
B.
The High Probative Value of the Gold Coins and Luxury
Watches Evidence is Not Substantially Outweighed by the
Danger of Unfair Prejudice Under Rule 403
Under Rule 403, the high probative value of this evidence is
not “substantially outweighed by a danger of one or more of the
following: unfair prejudice, confusing the issues, misleading the
jury, undue delay, wasting time, or needlessly presenting cumulative
evidence.” Fed. R. Evid. 403. Rule 403 does not preclude evidence
that prejudices a defendant’s case, “as all unfavorable evidence
about a defendant does” – it only precludes evidence that unfairly
prejudices a defendant’s case. United States v. Blitz, 151 F.3d
1002, 1009 (9th Cir. 1998).
Courts have explained that “Rule 403 does not provide a shield
for defendants who engage in outrageous acts, permitting only the
crimes of Caspar Milquetoasts to be described fully to a jury. It
does not generally require the government to sanitize its case, to
deflate witnesses’ testimony, or to tell its story in a monotone.
It does not bar powerful, or even ‘prejudicial’ evidence.” United
States v. Gartmon, 146 F.3d 1015, 1021 (D.C. Cir. 1998) (citing Old
Chief v. United States, 519 U.S. 172, 192 (1997)) (internal citation
omitted). Indeed, the Supreme Court recognizes that “the familiar,
standard rule that the prosecution is entitled to prove its case by
evidence of its own choice, or, more exactly, that a criminal
defendant may not stipulate or admit his way out of the full
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evidentiary force of the case as the Government chooses to present
it” is “unquestionably true as a general matter.” Old Chief, 519
U.S. at 186-87.
Guided by these principles, courts have found admissible under
Rule 403 far more potentially inflammatory evidence than the visual
depiction of the gold coins and luxury watches at issue here.
For example, in Gartmon, a case involving charges of interstate
transportation of securities obtained by fraud and money laundering,
the D.C. Circuit affirmed the admission of witness testimony that
defendant had threatened her by “put[ting] a gun up [her] vagina . .
. [and] told [her] that [she] will listen to everything he says and
do as he says.” Gartmon, 146 F.3d at 1019. The court acknowledged
that “there [wa]s no question but that the conduct portrayed by the
testimony was outrageous, and that it may dramatically have injured
[defendant’s] case.” Id. at 1021. But the court explained that
“[a]lthough there may have been some risk that a recitation of the
facts of the incident would evoke emotions in the courtroom, that
risk was comparatively small, and it alone did not render the
testimony ‘unfair’ or ‘substantially outweigh[]’ its probative
value.” Id. at 1021. The court did not require the government to
“sanitize” its case.
Similarly, in United States v. Gloster, 185 F.3d 910 (D.C. Cir.
1999), defendant attempted to limit under Rule 403 evidence of his
gun being loaded to testimony about the ammunition but not admission
of the ammunition itself. Id. at 913-914. The court rejected
defendant’s unfair prejudice argument, explaining that “[t]here is
no question . . . that physical evidence is an important part of an
effective trial presentation and that the ‘persuasive power of the
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concrete and particular is often essential to the capacity of jurors
to satisfy the obligations that the law places on them.’” Id. at
913 (quoting Old Chief, 519 U.S. at 172). See also United States v.
DeMuro, 677 F.3d 550 (3d Cir. 2012) (testimonial evidence regarding
defendants’ spending on “vacations, jewelry, cars, and parties . . .
not so inflammatory as to carry a great risk of prejudice,”
explaining the evidence was in part “relevant to the conspiracy [to
defraud the United States] charge as it was probative of
[defendants’] conspiratorial purpose”); Honie v. Crowther, Case No.
2:07-CV-628 JAR, 2017 WL 6398616, at *6 (D. Utah Dec. 13, 2017)
(affirming admission of graphic photographs of deceased victim,
defendant “covered in blood,” and children “with blood on them,”
explaining that the “State was not required to rely exclusively on
testimony to prove its case”) (citing Old Chief, 519 U.S. at 187-88,
and Gartmon, 146 F.3d at 1021).
The same is true here. The government seeks to admit physical
evidence of the fruits and means of defendants’ alleged bank/wire
fraud and money laundering conspiracies. The government should not
be required to “sanitize” this highly probative evidence for the
jury nor to “tell its story in a monotone.” Gartmon, 146 F.3d at
1021. The admission here of the visual depictions of the gold coins
and luxury watches is “an important part of an effective trial
presentation,” as “the ‘persuasive power of the concrete and
particular is often essential to the capacity of jurors to satisfy
the obligations that the law places on them.’” Gloster, 185 F.3d at
913 (quoting Old Chief, 519 U.S. at 172).
On the other side of the balance, there is little in the way of
“unfair” prejudice about the physical evidence of the gold coins and
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luxury watches. They accurately and effectively reflect the high
value of the expenditures defendants illegally made in laundering
the proceeds of their fraudulently obtained PPP/EIDL loans.
In addition, the admission of this evidence will conserve, not
waste, time during trial. Fed. R. Evid. 403. The government will
be able to limit the sponsoring witness’s testimony regarding
detailed descriptions of each of the luxury watches and the gold
coins seized from the Topeka Residence, should the government be
permitted to admit into evidence the actual items for ease of the
jury’s review. Nor is presenting this highly probative evidence
through both witness testimony and physical evidence cumulative
under Rule 403. The physical evidence will complement and aid in
the witness’s testimony about these items, and, with the exception
of the Gentleman Timepiece witness who sold defendant R. Ayvazyan at
least three of the luxury watches seized from his home and the
government’s summary witness regarding flow of funds, the government
does not anticipate other witnesses testifying about these items.
In sum, the visual images of the gold coins and luxury watches
are relevant to facts of consequence and are highly probative of
elements of the charged offenses, and present no credible danger of
unfair prejudice that substantially outweighs their probative value.
IV.
CONCLUSION
For the foregoing reasons, the government respectfully requests
the Court order that physical evidence of the gold coins and luxury
watches seized from the Topeka Residence be admissible at trial.
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