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Case 1:21-cr-00328-MLB-RGV Document 153 Filed 08/23/23 Page 1 of 89
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
UNITED STATES OF AMERICA ::
:: CRIMINAL CASE NO.
v. :: 1:21-cr-00328-MLB-RGV
::
BRIAN SPERBER and ::
EDMOND NORKUS ::
MAGISTRATE JUDGE’S REPORT, RECOMMENDATION, AND ORDER
Defendants Brian Sperber (“Sperber”) and Edmond Norkus (“Norkus”),
jointly referred to as “defendants,” are charged in a ten-count superseding
indictment with wire fraud, in violation of 18 U.S.C. §§ 1343 and 2; conspiracy to
commit wire fraud, in violation of 18 U.S.C. § 1349; conspiracy to commit money
laundering, in violation of 18 U.S.C. § 1956(h); and money laundering, in violation
of 18 U.S.C. §§ 1956(a)(1)(A)(i), 1957, and 2. [Doc. 58].1 Norkus has filed a motion
for bill of particulars, [Doc. 98], which the government opposes, [Doc. 107], and he
also has filed a motion to adopt, [Doc. 96], Sperber’s motion to dismiss
1 The listed document and page numbers in citations to the record refer to the
document and page numbers shown on the Adobe file reader linked to the Court’s
electronic filing database, CM/ECF.
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multiplicitous counts, [Doc. 25],2 and a motion to dismiss Counts Seven through
Ten, [Doc. 103], which Sperber has moved to adopt, [Doc. 106]. Defendants also
have filed a corrected joint motion to dismiss multiplicitous counts, [Doc. 105],3 as
well as a motion to dismiss the wire fraud counts, [Doc. 115]. The government
opposes defendants’ multiple motions to dismiss, see [Docs. 108, 109, & 125], and
defendants have filed joint replies in support of the motions, [Docs. 113, 114, &
127]. Norkus also has filed a motion to suppress statements, [Doc. 97], and
following an evidentiary hearing on this motion on May 10, 2023,4 the parties filed
2 Sperber filed a motion to dismiss multiplicitous counts on January 13, 2022, [Doc.
25], prior to the return of the superseding indictment, [Doc. 58], but he failed to
perfect the motion after being provided an opportunity to do so, see [Doc. 26], and
a Report, Recommendation, and Order, issued on June 13, 2022, [Doc. 39], directed
the Clerk to terminate the motion, since it was “deemed to have been abandoned,”
[id. at 2]. Norkus filed a motion to adopt, [Doc. 96], Sperber’s motion to dismiss,
[Doc. 25], after the Court had already directed the Clerk to terminate it, [Doc. 39].
However, following the return of the superseding indictment, [Doc. 58], the Court
provided Sperber an opportunity to perfect his motion to dismiss and Norkus an
opportunity to perfect his motion to adopt, see [Doc. 101], and they have now filed
perfected motions that are pending before the Court, [Docs. 103, 105, & 115].
Because Norkus’ original motion to adopt, [Doc. 96], pertains to a motion that is
no longer pending and was directed at the original indictment, see [Doc. 25], and
defendants have since perfected their motions to dismiss with respect to the
superseding indictment, his motion to adopt, [Doc. 96], is DENIED AS MOOT.
3 Defendants filed an initial joint motion to dismiss, [Doc. 104], but after the Clerk
directed them to include information for counsel for both defendants, they filed
the corrected joint motion, [Doc. 105].
4 See [Doc. 139] for a transcript of the evidentiary hearing held on May 10, 2023,
which will be referred to as “(Tr. at __)” and cited according to the page number
2
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post-hearing briefs, see [Docs. 142, 143, & 144]. For the reasons that follow,
Sperber’s motion to adopt, [Doc. 106], is GRANTED, Norkus’ motion for bill of
particulars, [Doc. 98], is DENIED and his motion to adopt, [Doc. 96], is DENIED
AS MOOT, and it is RECOMMENDED that defendants’ motions to dismiss,
[Docs. 103, 105, & 115], and Norkus’ motion to suppress statements, [Doc. 97], be
DENIED.5
I. INTRODUCTION
On August 25, 2021, a federal grand jury in the Northern District of Georgia
returned an indictment against Sperber, [Doc. 1], and on September 20, 2022, a
superseding indictment was returned against both defendants, charging them
with four counts of wire fraud, in violation of 18 U.S.C. §§ 1343 and 2; one count
located in the top right corner of the transcript. In addition, the government
submitted an exhibit at the evidentiary hearing, see [Docs. 132 & 134], which will
be referred to as “(Gov’t Ex. 1).”
5 Sperber also filed a motion to maintain filing ex parte and under seal, [Doc. 52],
in which he requests that the affidavit he filed providing information regarding
his financial status remain under seal and ex parte, [id. at 1, 3]. The Honorable
Michael L. Brown, United States District Judge for the Northern District of
Georgia, provided the government an opportunity to respond to this motion, see
[Doc. 54], but rather than file a response, the government indicated at an
evidentiary hearing before Judge Brown on September 26, 2022, see [Doc. 118], that
it had been provided the exhibits that were attached to the affidavit, and the
government appeared satisfied with the information provided, [id. at 3].
Accordingly, it is RECOMMENDED that Sperber’s motion to maintain filing ex
parte and under seal, [Doc. 52], be GRANTED.
3
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of conspiracy to commit wire fraud, in violation of 18 U.S.C. § 1349; one count of
conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h); two
counts of money laundering, in violation of 18 U.S.C. §§ 1956(a)(1)(A)(i) and 2; and
two counts of money laundering, in violation of 18 U.S.C. §§ 1957 and 2, [Doc. 58].
In particular, the superseding indictment alleges that “[b]eginning in or about 2020
and continuing until in or about March 2021,” Sperber, who “owned a healthcare
distributor located in Florida named Ark GBST [(‘Ark’)] that distributed [personal
protective equipment (‘PPE’)] on behalf of O&M Halyard[, Inc. (‘O&M
Halyard’)],” a subsidiary corporation that maintained its principal place of
business in Alpharetta, Georgia, and is a manufacturer and wholesale distributor
of PPE, and Norkus, who “owned Champion Resources, a logistics company
located in Florida that provided logistical services for Ark” and “also procured
PPE for customers largely through its relationship with Sperber’s various
companies,” engaged in a “scheme to defraud a PPE supplier as well as victims
who sought to procure PPE for hospital and medical institutions” and that through
“a combination of falsified invoices, emails, and other documents,” defendants
“defrauded prospective PPE purchasers out of more than $12 million, much of
which they used for [their] own personal benefit,” including the purchase of
Sperber’s waterfront mansion and Norkus’ condominium. [Id. ¶¶ 1, 3-4, 8-9 (all
caps omitted)].
4
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The superseding indictment charges that “[a]lmost as soon as [Sperber]
became an authorized O&M Halyard distributor in September 2019, [he] failed to
pay for previously shipped PPE,” despite the fact O&M Halyard employees
repeatedly told him that he “needed to pay down his outstanding balance in order
to remain an authorized distributor.” [Id. ¶ 10]. It is alleged that despite owing a
substantial amount of money to O&M Halyard, defendants “sent fabricated O&M
Halyard emails and invoices to Victim A,” a broker located in New York that
“sought to procure PPE for [a] Chinese hospital and medical institutions,” that
“falsely claimed O&M Halyard had an ample supply of N95 masks that was ready
to be shipped,” enticing Victim A to wire $3,144,960 to Champion Resources for
the PPE, with “an expected ship date of February 12, 2020.” [Id. ¶¶ 5, 11]. Norkus
is alleged to have “used approximately $875,000 of those funds to purchase a
condominium” in Florida, and to have wired $1,865,750 to Sperber, “who used
those funds to pay down an outstanding balance of over $1 million on previous
orders with O&M Halyard.” [Id. ¶ 11]. Defendants, however, “led Victim A to
believe that the funds were being used to purchase new PPE for Victim A,” by, for
example, Norkus sending a text message to Victim A on February 10, 2020, “with
a fabricated banking statement that falsely claimed Champion Resources had
wired nearly $3 million to O&M Halyard.” [Id.]. Because Victim A had not
received any PPE by February 13, 2020, it asked Norkus for a status update,
5
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leading Norkus to email Sperber, “You need to call me bro I have it set up where
we can talk while I’m [i]n front and your [sic] acting as [O&M Halyard.] It’s perfect
to get us next level,” and because Victim A still had not received any PPE by
February 27, 2020, Norkus forwarded an email that Sperber “had purportedly
received from O&M Halyard, stating, ‘I want you to understand your order is
confirmed[,]’” and Norkus then forwarded the email he sent to Victim A to
Sperber and stated, “What I had to send yesterday FYI.” [Id. ¶ 12 (internal marks
omitted)].
In addition, the superseding indictment alleges that in early 2020, Sperber
negotiated the purchase of PPE by Victim B, a pharmaceutical and medical
products wholesaler in Florida that “sought to procure PPE for an international
healthcare company,” and that defendants “led Victim B to believe that Sperber
could acquire a substantial amount of PPE from O&M Halyard and Dukal,” a
medical supply and medical product manufacturer of PPE located in New York,
even though Sperber had been notified by O&M Halyard “that an order of that
size was not possible,” and Dukal “had never confirmed . . . that they could deliver
the quantities of PPE that Victim B needed.” [Id. ¶¶ 2, 6, 13 (all caps omitted)]. It
is alleged that in order to “convince Victim B into believing they had access to
additional quantities of PPE, Norkus displayed pallets of PPE in a warehouse” and
that subsequently, Victim B “gave a $2.8 million cashier’s check to an individual
6
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operating on behalf of Sperber,” who then “delivered a portion of the glove order
to Victim B and promised that the difference would be made up in subsequent
orders.” [Id. ¶ 14 (all caps omitted)]. On March 31, 2020, “Victim B sent an
additional $8.25 million to Sperber for the purchase of N95 masks,” and on May 1,
2020, “Victim B sent an additional $2.5 million to Sperber for the purchase of N95
masks.” [Id. (all caps omitted)]. Thereafter, defendants “sent a series of false and
misleading emails, invoices and messages falsely suggesting that the PPE from
O&M Halyard was set to be delivered,” and they “also sent fabricated Dukal
documents and emails to Victim B purportedly showing that Dukal had an ample
supply of N95 masks that was ready to ship.” [Id. ¶¶ 15-16].6
6 For example, the superseding indictment details that on April 30, 2020, Sperber
emailed Victim B in response to its request for an update that he “expect[ed] this
to move asap.” [Doc. 58 ¶ 15 (internal marks omitted)]. On May 1, 2020, Norkus
also forwarded an email to Victim B that “had purportedly been sent from O&M
Halyard stating, ‘as discussed yesterday these 4 orders are now shipping.’” [Id.].
It is alleged, however, that defendants “knew this email was fabricated and that
O&M Halyard had not shipped Victim B’s orders.” [Id.]. Norkus is alleged to
have also forwarded an email to Victim B on May 1, 2020, “that was purportedly
sent by [a] Dukal employee” and then “pressed Victim B on making payments for
N95 masks,” prompting Victim B to “immediately wire[] $2.5 million to Sperber
to pay for the Dukal N95 masks,” even though defendants “knew that the
forwarded Dukal email was fabricated.” [Id. ¶ 16 (all caps omitted)]. On May 25,
2020, “Victim B emailed Sperber and asked about the status of the Dukal N95
masks,” and Sperber “responded by forwarding a fabricated Dukal spreadsheet
that falsely listed N95 masks as being available,” even though Sperber had
confirmed to a Dukal representative on May 4, 2020, that he had been told about
“the lack of inventory in existence.” [Id. (all caps and internal marks omitted)].
7
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The superseding indictment also alleges that, at times, Sperber “used the
victims’ funds to pay down his outstanding balance with O&M Halyard that had
been incurred prior to February 2020.” [Id. ¶ 17].7 It also alleges that defendants
“used a substantial portion of the victims’ funds for [their] own personal benefit,”
including that “[f]rom March 26 to May 4, 2020, Sperber used millions of dollars
of Victim B’s funds to purchase a waterfront mansion,” as well as “for a variety of
personal and business expenditures,” such as “renting a private jet, purchasing
jewelry, and purchasing food at restaurants,” and that Norkus “used
approximately $875,000 of Victim A’s funds to purchase a condominium[.]” [Id.
¶ 19 (all caps omitted)].
The superseding indictment specifically charges defendants in Counts One
through Four with wire fraud, in violation of 18 U.S.C. §§ 1343 and 2, based on
7 For example, the superseding indictment details that on April 13, 2020, Sperber
emailed an O&M Halyard employee that $50,000 had been wired as he knew “we
had a small invoice coming due,” and he was “also trying to expedite as much
product as possible to our markets so we are trying to pay down the line so we can
continue to work efficiently,” but that he “failed to disclose that these funds had
actually come from a prospective PPE purchaser who was expecting a shipment
of PPE.” [Doc. 58 ¶ 17 (internal marks omitted)]. It also alleges that on June 10,
2020, Sperber emailed an O&M Halyard employee that a payment “was debited
from our [account] late Monday and you should have seen it yesterday,” but that
he would “follow up [that day] at noon or so with [them] and if it [was] not in, [he
would] head to the bank,” even though Sperber knew he had not made the
payment. [Id. ¶ 18 (internal marks omitted)].
8
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certain emails and text messages sent to O&M Halyard employees. [Id. ¶ 24].
Count Five charges defendants with conspiracy to commit wire fraud, in violation
of 18 U.S.C. § 1349, from about February 2020, and continuing until about March
2021. [Id. ¶¶ 25-26]. Count Six charges defendants with money laundering
conspiracy, in violation of 18 U.S.C. § 1956(h), alleging that beginning in about
2020, and continuing to about March 2021, defendants knowingly combined,
conspired, and agreed “with each other to commit offenses against the United
States in violation of [18 U.S.C. §§] 1956 and 1957,” [Id. ¶¶ 27-28]. This count also
details the manner and means of the conspiracy as defendants using “hundreds of
thousands of dollars from Victim A to pay down Sperber’s outstanding balance
with O&M Halyard,” instead of using the funds to purchase PPE as had been
promised to Victim A, in order “to remain an O&M Halyard distributor so that
they could commit additional acts of fraud.” [Id. ¶ 29 (all caps omitted)].
Counts Seven and Eight of the superseding indictment charge defendants
with money laundering, in violation of 18 U.S.C. §§ 1956(a)(1)(A)(i) and 2, while
Counts Nine and Ten charge defendants with money laundering, in violation of
18 U.S.C. §§ 1957 and 2. See [Id. ¶¶ 30-37]. In particular, Count Seven charges
defendants with money laundering, in violation of 18 U.S.C. §§ 1956(a)(1)(A)(i)
and 2, alleging in relevant part:
On or about February 12, 2020, . . . the defendants . . ., aided and
abetted by each other, did knowingly conduct a financial transaction
9
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affecting interstate commerce, to wit: causing a cashier’s check in the
amount of $350,000 from TD Bank to be deposited into an O&M
Halyard bank account, which involved the proceeds of specified
unlawful activity, that is, conspiracy to commit wire fraud . . . and
wire fraud . . ., with the intent to promote the carrying on of such
specified unlawful activity and while conducting and attempting to
conduct such financial transactions knew the property involved in the
financial transaction represented the proceeds of some form of
unlawful activity.
[Id. ¶ 31]. Count Eight similarly charges defendants with money laundering, in
violation of 18 U.S.C. §§ 1956(a)(1)(A)(i) and 2, alleging in relevant part:
On or about February 12, 2020, . . . the defendants . . ., aided and
abetted by each other, did knowingly conduct a financial transaction
affecting interstate commerce, to wit: causing a cashier’s check in the
amount of $720,000 from TD Bank to be deposited into an O&M
Halyard bank account, which involved the proceeds of specified
unlawful activity, that is, conspiracy to commit wire fraud . . . and
wire fraud . . ., with the intent to promote the carrying on of such
specified unlawful activity and while conducting and attempting to
conduct such financial transactions knew the property involved in the
financial transaction represented the proceeds of some form of
unlawful activity.
[Id. ¶ 33].
Count Nine charges defendants with money laundering, in violation of 18
U.S.C. §§ 1957 and 2, alleging in relevant part:
On or about February 12, 2020, . . . the defendants . . ., aided and
abetted by each other, did knowingly engage and attempt to engage
in a monetary transaction by, through and to a financial institution,
affecting interstate commerce, such transaction knowingly involving
criminally derived property of a value greater than $10,000, that is,
causing a cashier’s check in the amount of $350,000 from TD Bank to
be deposited into an O&M Halyard bank account, such property
10
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having been derived from a specified unlawful activity, that is wire
fraud[ and] . . . conspiracy to commit wire fraud. . .
[Id. ¶ 35]. Count Ten similarly charges defendants with money laundering, in
violation of 18 U.S.C. §§ 1957 and 2, alleging in relevant part:
On or about February 12, 2020, . . . the defendants . . ., aided and
abetted by each other, did knowingly engage and attempt to engage
in a monetary transaction by, through and to a financial institution,
affecting interstate commerce, such transaction knowingly involving
criminally derived property of a value greater than $10,000, that is,
causing a cashier’s check in the amount of $720,000 from TD Bank to
be deposited into an O&M Halyard bank account, such property
having been derived from a specified unlawful activity, that is wire
fraud[ and] . . . conspiracy to commit wire fraud. . .
[Id. ¶ 37]. Defendants have filed several pretrial motions, [Docs. 97, 98, 103, 105,
& 115], which are now fully briefed and ripe for ruling.
II. DISCUSSION
A. Norkus’ Motion for Bill of Particulars, [Doc. 98]
In his motion for bill of particulars, [Doc. 98], Norkus “acknowledges that
the [superseding] indictment contains more than barebones allegations against
him,” but he contends that “it is lacking in critical ways,” pointing out that while
“many of the allegations in the [superseding] indictment against [ him] involve e-
mails sent to the companies labeled as Victims A and B,” the “remainder of the
allegations involve co-defendant [] Sperber’s relationship with O&M Halyard . . .
for whom Sperber and Sperber’s company were a distributor,” and that the
“substantive counts of wire fraud all related to e-mails that Sperber sent to O&M
11
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Halyard, [while] the substantive money laundering counts all involve transfers
from a bank account controlled by Sperber to O&M Halyard,” but that the
superseding “indictment does not contain any allegations that [] Norkus had any
stake in Sperber’s ongoing relationship with O&M Halyard, that [ he] had any role
in sending the e-mails charged in the substantive counts, or that [ he] knew about
and/or was involved in sending money from Sperber’s bank account to O&M
Halyard,” such that “[a] bill of particulars is [] necessary to allow [ him] to prepare
for trial,” [id. at 3-4 (citations omitted)]. Therefore, Norkus moves the Court to
order the government to file a bill of particulars, providing the following
information:
(1) Does the government believe that [] Norkus had any direct contact
with O&M Halyard, or any O&M Halyard employees?
(2) Does the government believe that [] Norkus knew of the e-mails
that Sperber sent to O&M Halyard that are alleged in the substantive
wire fraud counts, or took any actions related to those e-mails?
(3) Does the government believe that [] Norkus knew of the wire
transfers that Sperber sent to O&M Halyard that are the basis of the
substantive money laundering counts, or took any action related to
those transactions?
(4) What are the precise actions that [] Norkus took to aid and abet
Sperber as it relates to Counts 1-4 and 7-10?
(5) Is the alleged scheme to defraud a scheme to defraud Victims A
and B, or a scheme to defraud O&M Halyard?
(6) How was O&M Halyard injured by the e-mails alleged in Counts
1-4?
12
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[Id. at 4-5].8
In its response opposing the motion, [Doc. 107], the government argues that
the motion should be denied because “[t]he [s]uperseding [i]ndictment more than
sufficiently informs [Norkus] of the charges he is facing, and the discovery turned
over contains the information [he] is requesting,” [id. at 2]. In particular, the
government points out that while Norkus “lists six interrogatory-style questions
that seek to compel the United States to answer a litany of questions about how it
will prove its case at trial,” the superseding indictment “and discovery more than
adequately inform Norkus of the charges in sufficient detail to enable him to
prepare a defense, minimize surprise at trial, and plead double jeopardy, if
necessary.” [Id. at 5 (citation omitted)]. It points out that that the speaking
superseding indictment, which is “nineteen pages long and includes forty
numbered paragraphs,” includes twenty-three paragraphs that “are almost
exclusively devoted to providing a detailed explanation of how defendants carried
out the conspiracy, and include examples of false emails sent to the victims of the
8 In his reply brief, Norkus explains that “[a]lthough [ he] phrased the questions
in the form of ‘does the government believe,’ the questions were intended to elicit
whether the government had evidence of and/or intended to present evidence.”
[Doc. 112 at 2 n.1]. He also “supplements his motion for a bill of particulars with
a request for additional details about what act is the ‘specified unlawful activity,’”
in light of the government’s response to his motion to dismiss the money
laundering counts. [Id. at 3-4].
13
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offense,” while the “‘Manner and Means’ section beginning on page three
provides a detailed description of how the defendants carried out their scheme to
defraud.” [Id. at 5-6]. The government further points out that its “discovery
production has been substantial, much of which provides the exact information
Norkus is seeking,” and that Norkus’ attempt to force it to respond to the six
interrogatory-type questions is nothing more than “a thinly veiled attempt to force
the [ government] to reveal its entire case theory,” but that a “bill of particulars
cannot be used to ferret out additional overt acts not listed in the indictment, as
long as the indictment alleges the required number of overt acts under the statute
being charged.” [Id. at 7-9 (footnote, citation, and internal marks omitted)].
Accordingly, the government maintains that Norkus has failed to “carr[y] his
burden of showing that the requested information is necessary for trial
preparation,” and the Court should deny his motion. [Id. at 2].
In reply, Norkus maintains that as to his “requests 1-3, the indictment does
not allege—and the discovery does not reveal—whether the government has
evidence that [ he] interacted directly with O&M Halyard or knew the details
about [] Sperber’s relationship with O&M Halyard,” and that it “is unclear to []
Norkus what evidence there is that he knew about a scheme to defraud O&M
[Halyard], had any stake in a scheme to defraud O&M, or, perhaps most
importantly, had any intent to harm O&M.” [Doc. 112 at 2]. He also maintains
14
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that as to “questions 5 and 6, [ he] has asked about the government’s position as
to the alleged victims and any alleged injury to O&M Halyard,” since “the
potential injuries that O&M Halyard suffered or could have suffered . . . is an
essential element of the wire fraud charges,” and that he “seeks specificity about
the scheme to defraud because . . ., although there are allegations about Victims A
and B, the substantive counts each relate [] only to fraud directed at O&M
Halyard,” but the government “must prove an intent to injure,” and therefore, he
“seeks clarity on who the defendants are alleged to have intended to injure.” [Id.
at 3].
Rule 7(f) of the Federal Rules of Criminal Procedure provides that the Court
“may direct the government to file a bill of particulars.” Fed. R. Crim. P. 7(f). “The
purpose of a true bill of particulars is threefold: ‘to inform the defendant[s] of the
charge against [them] with sufficient precision to allow [them] to prepare [their]
defense, to minimize surprise at trial, and to enable [them] to plead double
jeopardy in the event of a later prosecution for the same offense.’” United States
v. Reddy, Criminal Action File No. 1:09-CR-0483-ODE/AJB, 2010 WL 3210842, at
*5 (N.D. Ga. Apr. 5, 2010) (quoting United States v. Cole, 755 F.2d 748, 760 (11th
Cir. 1985)), adopted as modified by 2010 WL 3211029, at *7 (N.D. Ga. Aug. 11,
2010); see also United States v. Colson, 662 F.2d 1389, 1391 (11th Cir. 1981)
(citations omitted); United States v. Zellner, Criminal Indictment No. 1:09-CR-320-
15
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TCB-GGB, 2011 WL 530718, at *9 (N.D. Ga. Jan. 14, 2011) (citation omitted),
adopted sub nom. United States v. Chester, Criminal Action File No. 1:09-cr-320-
TCB-GGB, 2011 WL 529952, at *1 (N.D. Ga. Feb. 4, 2011). Generalized discovery is
not a valid reason for seeking a bill of particulars, Colson, 662 F.2d at 1391 (citation
omitted); United States v. Davis, 582 F.2d 947, 951 (5th Cir. 1978),9 and “[a] bill of
particulars may not be used for the purpose of obtaining detailed disclosure of the
government’s case or evidence in advance of trial,” Zellner, 2011 WL 530718, at *9
(citation omitted). Moreover, defendants are not entitled to a bill of particulars
describing information which is already evident from other sources, such as
elsewhere in the indictment or in discovery. United States v. Rosenthal, 793 F.2d
1214, 1227 (11th Cir. 1986) (citation omitted), modified on other grounds by, 801
F.2d 378 (11th Cir. 1986); see also Reddy, 2010 WL 3210842, at *5 (citation omitted).
Further, “[w]hen a court analyzes the sufficiency of an indictment, it reviews the
indictment as a whole and give[s] it a common sense construction.” United States
v. Mitchell, CRIMINAL CASE NO. 1:17-CR-122-LMM-LTW, 2019 WL 6462838, at
*22 (N.D. Ga. June 25, 2019) (last alteration in original) (citation and internal marks
omitted), adopted by 2019 WL 3854307, at *3 (N.D. Ga. Aug. 16, 2019). And, the
9 Decisions of the Fifth Circuit rendered before October 1, 1981, are binding
precedent in the Eleventh Circuit. Bonner v. City of Prichard, 661 F.2d 1206, 1209
(11th Cir. 1981) (en banc).
16
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“level of detail in the indictment can be a basis for denying the motion for a bill of
particulars.” United States v. Valdez-Morales, No. 3:15-CR-56, 2016 WL 919029, at
*3 (E.D. Tenn. Mar. 4, 2016) (citation omitted).
In this case, the “conspiracy count[s] of the [superseding i]ndictment . . .
sufficiently allege[] [those] charge[s] by stating the elements of the offense[s]
charged therein and by providing details regarding the manner and means - or the
scheme to defraud - by which [d]efendants participated in the charged
conspiracy.” United States v. Greenhill, CRIMINAL CASE NO. 1:18-CR-00108-
MHC-JFK, 2018 WL 5659933, at *2 (N.D. Ga. Sept. 20, 2018) (citation omitted),
adopted by 2018 WL 5649898, at *1 (N.D. Ga. Oct. 31, 2018). Indeed, the
superseding indictment provides that defendants engaged in a scheme to defraud
a PPE supplier, as well as two specific victims who sought to procure PPE; the time
frame of the conspiracy; specific examples of the alleged fraudulent emails sent by
defendants; and it sufficiently informs each co-conspirator of his specific offense
conduct, as well as the overall object of the conspiracy. See generally [Doc. 58].
The superseding indictment also tracks the statutory language of the offenses
charged, informing Norkus of the essential elements of the offense. See [id.]. “The
Eleventh Circuit has previously found that an indictment alleging such facts is
sufficient,” Mitchell, 2019 WL 6462838, at *23 (citing United States v. Williams, 181
F. App’x 945, 948-49 (11th Cir. 2006) (per curiam) (unpublished); United States v.
17
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Ramos, 666 F.2d 469, 474-75 (11th Cir. 1982)), and the government “need not prove
that each defendant had knowledge of all details and phases of the conspiracy
when the defendant knows the essential nature of the conspiracy,” id. (citation
omitted). Indeed, an “individual cannot escape guilt [of conspiracy] merely
because . . . he played a minor role in the total scheme,” and the government “does
not have to prove that the defendant agreed to commit or facilitate each and every
part of the substantive offense.” Id. (alteration in original) (citations and internal
marks omitted). That is, “[a] defendant can be a co-conspirator even if he did not
know all aspects or details of the conspiracy or all of the individuals involved,
came into the conspiracy after it began and played only a minor role in the
conspiracy,” and “[i]t is irrelevant that particular conspirators may not have
known other conspirators or may not have participated in every stage of the
conspiracy,” since “all that the government must allege is an agreement or
common purpose to violate the law and intentional joining in this goal by
conspirators.” Id. (citations and internal marks omitted).
Norkus moves the Court to order the government to file a bill of particulars,
outlining whether the government believed that he had any direct contact with
O&M Halyard, whether he knew of the emails that his co-conspirator sent to O&M
Halyard as alleged in the wire fraud counts, whether the government believed that
he knew of the wire transfers his co-conspirator sent to O&M Halyard that are the
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basis for the money laundering counts, the precise actions he took to aid and abet
his co-conspirator, whether the scheme to defraud was to defraud Victims A and
B or O&M Halyard, how O&M Halyard was injured, and that identifies the
specified unlawful activity identified in Counts Six through Ten, [Doc. 98 at 5; Doc.
112 at 3-4]; however, Norkus is “not entitled to a bill of particulars with respect to
information which is already available through other sources such as the
[superseding] indictment and discovery,” Mitchell, 2019 WL 6462838, at *19
(citations omitted); see also United States v. Jackson, CRIMINAL ACTION FILE
NO. 1:16-CR-427-AT-JKL-8, 2019 WL 7842416, at *3 (N.D. Ga. Aug. 29, 2019)
(citation omitted), adopted by 2019 WL 6769233, at *2 (N.D. Ga. Dec. 12, 2019), and
Norkus’ requests “seek[] evidentiary detail . . . that is not appropriate in a bill of
particulars,” Greenhill, 2018 WL 5659933, at *3 (citations omitted). That is, “there
is a difference between being surprised by the charge and being surprised by the
evidence supporting a charge,” and “[t]he function of the bill of particulars is to
reduce surprise at the charge, that is, to enable the defendant to identify what he
is alleged to have done in violation of law,” but “[i]t is not to eliminate surprise
with respect to evidence offered in support of a charge that is clearly understood
by the defendant.” United States v. Scrushy, Case No. CR-03-BE-530-S, 2004 WL
483264, at *9 n.5 (N.D. Ala. Mar. 3, 2004) (emphasis omitted). In fact, “Rule 7 does
not give a defendant the right to insist that he be made aware of all of the evidence
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the [g]overnment may use against him so that he literally is not ‘surprised’ by
anything at trial,” id., and here, Norkus admits that his “questions were intended
to elicit whether the government ha[s] evidence of and/or intended to present
evidence,” [Doc. 112 at 2 n.1], but “[a] bill of particulars . . . is not designed to
compel the government to detailed exposition of its evidence or to explain the legal
theories upon which it intends to rely at trial,” United States v. Roberts, 174 F.
App’x 475, 477 (11th Cir. 2006) (per curiam) (unpublished) (citation and internal
marks omitted); see also United States v. Baitcher, Criminal Action File No. 1:11-
CR-536-SCJ-AJB, 2013 WL 1501462, at *2 (N.D. Ga. Mar. 22, 2013) (footnote and
citations omitted) (“A bill of particulars may be obtained to clarify an indictment,
as long as it does not seek to determine in advance the government’s proof.”),
adopted by 2013 WL 1501454, at *1 (N.D. Ga. Apr. 11, 2013); United States v.
Wimbley, Criminal No. 11-0019-WS, 2011 WL 3204539, at *2 (S.D. Ala. July 27,
2011) (citations omitted) (“Defendants are not entitled to a bill of particulars as a .
. . comprehensive preview of the [g]overnment’s trial proof or theories.”); United
States v. Perez, No. CR 106-029, 2006 WL 1737449, at *3 (S.D. Ga. June 19, 2006)
(citation omitted) (“Nor is [a bill of particulars] intended to secure for the defense
the government’s explanation of its theory of the case.”), adopted at *1. The
superseding indictment is “very exhaustive and legally sufficient,” United States
v. Bickers, CRIMINAL INDICTMENT. NO. 1:18-CR-98-SCJ-LTW, 2019 WL
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7559292, at *8 (N.D. Ga. Sept. 17, 2019), adopted by 2019 WL 5587050, at *7 (N.D.
Ga. Oct. 30, 2019), as Norkus acknowledges, see [Doc. 98 at 3; Doc. 112 at 1], and it
describes in detail the object and manner and means of the alleged fraudulent
scheme, as well as the role of each co-conspirator in the scheme, see [Doc. 58]. In
addition, “contrary to [Norkus’] request in this case, [c]ase law is also clear that
the [g]overnment is not required to identify . . . specific acts or overt acts done in
furtherance of a charged conspiracy by particular defendants.” Greenhill, 2018
WL 5659933, at *3 (second and fourth alterations in original) (citations and internal
marks omitted). Indeed, “[i]n a case where the evidence being sought by a bill of
particulars consists of activities in which a defendant participated or witnessed,
the defendant could hardly have been surprised by the government’s proof at
trial.” Id. (citations and internal marks omitted); see also United States v.
Williams, 113 F.R.D. 177, 179 (M.D. Fla. 1986) (footnote and citation omitted)
(explaining that when the “[i]nformation about events in which one or more of the
defendants participated, or which occurred in one or more of the defendants’
presence” was sought, the “Eleventh Circuit has held that this sort of information
need not be furnished in a bill of particulars”). “Quite frankly, [d]efendants
should be well aware of which of them . . . interacted with the [PPE supplier and
Victims A and B] and engaged in the conduct underlying the scheme to defraud,
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including failing to inform the victims that [d]efendants were diverting the funds
to their personal benefit.” Greenhill, 2018 WL 5659933, at *3.
In sum, the superseding indictment provides “sufficient information about
the nature of the charges to enable [Norkus] to prepare for trial, to avoid unfair
surprise, and to enable [him] to plead double jeopardy in the event of a later
prosecution for the same offense.” Bickers, 2019 WL 7559292, at *8 (citations
omitted). Norkus “is not entitled to information, beyond the detailed [superseding
i]ndictment and extensive discovery produced by the government, describing the
specific role [he is alleged to have] played [] in the conspiracy or the particular acts
[he] is alleged to have participated in, had knowledge of, or for which he is being
held responsible.”10 United States v. Sterritt, 21-CR-193 (KAM), 2023 WL 4140269,
at *4 (E.D.N.Y. June 22, 2023) (all but first alteration in original) (citation and
10 While Norkus asserts that the government “does not fulfill its obligation merely
by providing mountains of documents to defense counsel who are left unguided
as to which documents are relevant,” [Doc. 98 at 3 (alteration and citations
omitted)], and it is true that “voluminous discovery cannot cure the defects of an
indictment that alone is insufficient to satisfy the [g]overnment’s obligation, a bill
of particulars is required only where the charges of the indictment are so general
that they do not advise the defendant of the specific acts of which he is accused,”
Sterritt, 2023 WL 4140269, at *4 (alterations, citations, and internal marks omitted),
which is not the case here where “the detailed factual allegations in the
[s]uperseding [i]ndictment provide sufficient notice of the charges against
[Norkus] . . ., and the discovery produced by the government, though voluminous,
supplements an already sufficient [s]uperseding [i]ndictment,” id. (citations
omitted).
22
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internal marks omitted). In short, Norkus “bears the burden of showing that the
information requested is necessary and that he will be prejudiced without it so as
to justify granting a bill of particulars,” Jackson, 2019 WL 7842416, at *3 (citations
and internal marks omitted), and he has failed to meet his burden with respect to
the particulars sought by his motion. Accordingly, Norkus’ motion for a bill of
particulars, [Doc. 98], is DENIED.
B. Defendants’ Motions to Dismiss, [Docs. 103, 105, & 115]
Defendants jointly move to dismiss counts in the superseding indictment as
multiplicitous. [Doc. 105]. Norkus also moves to dismiss Counts Seven through
Ten, which are the money laundering counts, for failure to allege a crime, [Doc.
103], which Sperber has moved to adopt, [Doc. 106]. Finally, defendants jointly
move to dismiss the wire fraud counts for failure to properly charge any conduct
under the lulling exception. [Doc. 115]. In response, the government maintains
that the superseding indictment is not multiplicitous because each count requires
an element of proof that the other count does not require and that the superseding
indictment adequately alleges the charged offenses. [Docs. 108, 109, & 125]. For
the reasons that follow, the Court agrees with the government.
1. Alleged Multiplicitous Counts
“An indictment is multiplicitous if it charges a single offense in more than
one count.” United States v. Williams, 527 F.3d 1235, 1241 (11th Cir. 2008)
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(citations omitted). “A multiplicitous indictment not only subjects the
defendant[s] to numerous sentences for one offense, but also prejudice[s] the
defendant[s] and confuse[s] the jury by suggesting that not one but several crimes
have been committed.” Id. (second and fourth alterations in original) (footnote,
citation, and internal marks omitted). Therefore, “[a] multiplicitous indictment []
violates the principles of double jeopardy because it gives the jury numerous
opportunities to convict the defendant[s] for the same offense.” Id. Thus,
“[b]ecause a multiplicitous indictment involves double jeopardy issues,
multiplicity and double jeopardy challenges are typically evaluated under the
same standards.” United States v. Woods, 730 F. Supp. 2d 1354, 1376 (S.D. Ga.
2010), aff’d, 684 F.3d 1045 (11th Cir. 2012) (per curiam). “Accordingly, the test
enunciated in [Blockburger v. United States, 284 U.S. 299 (1932),] used to evaluate
double jeopardy challenges . . . is also used to determine whether an indictment is
multiplicitous, verifying that each count requires an element of proof that the other
counts do not require.” Id. (citation and internal marks omitted).
“Under Blockburger[,] the test to be applied to determine whether two
statutory provisions prohibiting the same conduct violate the Double Jeopardy
Clause, or whether each count of the indictment may result in a conviction for the
same offense, is whether each provision [or count] requires proof of a fact which
the other does not.” Id. (last alteration in original) (citation and internal marks
24
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omitted). Pursuant to this test, “the focus is on the proof necessary to establish the
statutory elements of the offense, not the actual evidence presented at trial.” Id.
(citation omitted). However, “multiplicity in an indictment does not require the
entire indictment to be dismissed; instead, the appropriate remedy for multiplicity
calls for consolidating a multiplicitous charge into one count, or issuing special
instructions to the jury.” United States v. Bobo, No. CRA 1:06CR0172-02 TW, 2007
WL 962978, at *4 (N.D. Ga. Feb. 20, 2007) (citation omitted), adopted by 2007 WL
9676896, at *1 (N.D. Ga. Mar. 23, 2007).
Defendants first assert that Counts One through Four, charging defendants
“with four substantive counts of wire fraud, with each count being a separate e-
mail sent from [] Sperber to O&M Halyard employees” that “promised O&M
Halyard that a payment was on the way to pay down [Sperber’s] account balance
with O&M Halyard,” are “multiplicitous because they are not separate executions
of the alleged wire fraud scheme,” but are instead “part of one single attempt to
execute the alleged fraud scheme.” [Doc. 105 at 2, 4 (citation omitted)]. The
government responds that “[e]ach substantive wire fraud charge relates to emails
that Sperber sent to O&M Halyard representatives to carry out the [] scheme to
defraud,” and because 18 U.S.C. § 1343 “targets not the defendant[s’] creation of a
scheme to defraud, but the defendant[s’] execution of a scheme to defraud,” it
“punishes each interstate wire transmission that carries out that scheme,” and
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“[w]here one scheme or artifice to defraud involves multiple wire transmissions,
each wire transmission may form the basis for a separate count.” [Doc. 108 at 3-4
(footnote, citations, and internal marks omitted)]. The government also asserts
that because the “charged wires were ‘lulling’ emails,” they “were each sent in
furtherance of the scheme to defraud,” and “[u]nder the lulling exception, a wire
transfer subsequent to a defendant obtaining control of fraudulently obtained
funds may be considered part of the fraudulent scheme if it was used to lull the
scheme’s victims into a false sense of security that they are not being defrauded,
thereby allowing the scheme to go undetected.” [Id. at 5 (citation and internal
marks omitted)]. In their reply, defendants maintain that “[e]ven assuming that
the emails properly fill the ‘lulling exception’ to wire fraud, that does not mean
that each of the individual emails is a separate execution of the scheme, as opposed
to one execution of the scheme,” and that “it is clear that the emails charged in the
[superseding] indictment are part of one purported attempt to ‘lull’ O&M
Halyard” and “relate to one single wire that [] Sperber was promising to send.”
[Doc. 114 at 3-4 (footnote and citation omitted)].
“To prove the crime of wire fraud under 18 U.S.C. § 1343, the government
must establish that defendant (1) intentionally participated in a scheme to defraud;
and (2) used wire communications to further that scheme.” Skillern v. United
States, No. 20-13380-H, 2021 WL 3047004, at *11 (11th Cir. Apr. 16, 2021) (citation
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and internal marks omitted). “In that regard, [t]he relevant question at all times is
whether the [wire] is part of the execution of the scheme as conceived by the
perpetrator at the time.” Id. (alterations in original) (citation and internal marks
omitted). “The wire transmission itself need not be essential to the success of the
scheme to defraud,” but rather, “the wire transmission is for the purpose of
executing the scheme to defraud if it is incident to an essential part of the scheme
or a step in the plot.” Id. (citation and internal marks omitted).
“Where one scheme or artifice to defraud involves multiple wire
transmissions, each wire transmission may form the basis for a separate count.”
Williams, 527 F.3d at 1241. “A difficult conceptual question arises . . . as to whether
particular transactions constitute an execution of a scheme or merely a component
of such execution,” United States v. Williams, CIVIL ACTION NO. 2:13-CR-21-
RWS-JCF, 2015 WL 9999192, at *4 (N.D. Ga. Dec. 18, 2015) (citation and internal
marks omitted), adopted by 2016 WL 447844, at *1 (N.D. Ga. Feb. 4, 2016), but “[i]n
determining whether each wire transmission is an execution, courts must look to
the function of the wire transmission in the context of the defendant[s’] overall
scheme and examine how that transmission furthers the scheme,” Williams, 527
F.3d at 1241. Moreover, “[w]ire communications that lull a victim into a false sense
of security after the victim’s money had already been obtained, or that assist the
defendant[s] in avoiding detection may be sufficient to further a scheme,” United
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States v. Corrigan, Case No. 13-CR-915, 2016 WL 4945013, at *5 (N.D. Ill. Sept. 15,
2016) (citations and internal marks omitted), aff’d, 912 F.3d 422 (7th Cir. 2019), and
transmissions “designed to conceal or delay the detection of a scheme may be
asserted as separate counts in furtherance of that scheme,” United States v.
Mosberg, 866 F. Supp. 2d 275, 313 (D.N.J. 2011); see also United States v. Lane, 474
U.S. 438, 453 (1986) (finding each of the mailings satisfied the “in furtherance”
requirement because the mailings lulled the victim insurance company into a false
sense of security by giving it the impression that defendants’ claims were
legitimate); United States v. Hill, 643 F.3d 807, 859 (11th Cir. 2011) (citation
omitted) (“Under the lulling exception, mailings are sufficiently a part of the
execution of a fraudulent scheme if they are used to lull the scheme’s victims into
a false sense of security that they are not being defrauded, thereby allowing the
scheme to go undetected.”).
The superseding indictment charges “a scheme to defraud a PPE supplier
as well as victims who sought to procure PPE for hospital and medical
institutions” through “a combination of falsified invoices, emails, and other
documents” via which defendants “defrauded prospective PPE purchasers out of
more than $12 million, much of which they used for [their] own personal
benefit[.]” [Doc. 58 ¶ 9]. It also alleges that after Sperber failed to pay O&M
Halyard for previously shipped PPE and he was advised that unless he paid down
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his outstanding balance, he would not be able to remain an authorized distributor
and that it would no longer distribute PPE through his company if he did not make
timely payments, defendants used funds wired from the victims to pay down the
outstanding balance with O&M Halyard, among other things, without disclosing
that the funds were from prospective PPE purchasers expecting a shipment of PPE
and by representing to O&M Halyard employees that payments had been made
that were not. [Id. ¶¶ 10-11, 14, 17-18].
Under the “Execution of the Wire Fraud Scheme” section of the superseding
indictment, defendants are charged with four counts of wire fraud based on emails
sent by Sperber to O&M Halyard employees on May 26, May 28, June 2, and June
10, 2020, regarding funds to be wired to O&M Halyard. [Id. ¶ 24 (emphasis
omitted)]. The superseding indictment further alleges that defendants “used
hundreds of thousands of dollars from Victim A to pay down Sperber’s
outstanding balance with O&M Halyard” instead of purchasing PPE so that they
could “remain an O&M Halyard distributor” and “could commit additional acts
of fraud.” [Id. ¶ 29 (all caps omitted)].
As previously discussed, to “prove wire fraud the government must show
[defendants’] participation in a scheme to defraud, [their] intent to defraud, and
[their] use of the wires in furtherance of the fraudulent scheme,” and “[w]ire
communications that lull a victim into a false sense of security after the victim’s
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money had already been obtained, or that assist the defendant[s] in avoiding
detection may be sufficient to further a scheme.” Corrigan, 912 F.3d at 428
(emphasis, citation, and internal marks omitted).11 “[T]he ‘in furtherance’ cases
show that using a wire service need only involve some way, before or after the
fraud, of furthering the fraudulent act, including covering it up,” and therefore,
“each e-mail can, on its own, be deemed a unit of the wire fraud crime” and “can
support a few additional counts,” with the “bottom line [being] whether the
government must prove something different with each e-mail.” United States v.
Williamson, No. CR409–030, 2009 WL 3208421, at *7 (S.D. Ga. June 25, 2009), report
and recommendation rejected as moot based on defendant’s plea, 2009 WL
3208396, at *1 (S.D. Ga. Oct. 6, 2009). In the present case, “the government can
11 In support of their motion to dismiss, defendants cite the bank fraud statute, and
cases interpreting that statute, [Doc. 105 at 3 (citations omitted)], and argue that
because the “wire fraud and bank fraud statutes are structured nearly identically,
such that cases involving one crime are relevant to analyzing issues with the other
statutes,” the fact that the case they cited involved bank fraud “does not render it
irrelevant,” [Doc. 114 at 1 (citation omitted)]. Defendants, however, overlook that
while “the bank fraud statute . . . was modeled on the mail and wire fraud statutes,
the mail and wire fraud statutes punish each act in furtherance, or execution, of
the scheme; but the bank fraud statute imposes punishment only for each
execution of the scheme.” Williams, 2015 WL 9999192, at *7 (citations and internal
marks omitted). Therefore, “while separate ‘lulling’ mailings can be charged in
separate mail [or wire] fraud counts . . ., that is not the case under the bank fraud
statute if those mailings are merely acts in furtherance of the scheme to defraud
rather than separate executions or attempted executions of the scheme.” Id. Thus,
defendants’ reliance on the bank fraud statute in this regard is without merit.
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prove that each e-mail was sent on a different day and said something different,”
and quite simply, “[t]hat is enough,” and the superseding indictment “is not
multiplicitous” in this respect. Id.; see also Corrigan, 912 F.3d at 428 (finding that
three counts of wire fraud based on one email that solicited funds by relying on
false statements and material misrepresentations about the need for the funds and
two additional emails sent two days apart assuring the victim that the funds were
used for its intended purpose and therefore lulled the victim “into a false sense of
security,” were not multiplicitous).12
12 To the extent defendants argue that the charged emails cannot be based on the
lulling theory because it was not alleged in the superseding indictment, see [Doc.
114 at 3 n.1]; see also [Doc. 115 at 4 (arguing that the superseding “indictment fails
to contain any explanation of how the emails charged in the wire fraud counts
could fall under the ‘lulling exception[]’”), as will be discussed hereinafter, “[i]n
reviewing the sufficiency of an indictment, [the C]ourt should consider each
challenged count as a whole and refrain from reading it in a hyper-technical
manner; the [superseding] indictment must be read to include facts which are
necessarily implied and construed according to common sense,” United States v.
Braeger, Case No. 21-CR-233, 2023 WL 2136722, at *2 (E.D. Wis. Feb. 21, 2023)
(citations omitted). “Thus, failure to explicitly include all the elements of the
offense in an indictment is not fatal so long as the absent elements can be deduced
from the language that is actually included in the charging document.” Id.
(citation omitted). Here, the “[s]uperseding indictment [suggests] that the
[d]efendants’ actions . . . [were] those of conspirators whose actions were
furthering the conspiracy,” and “[a] mailing can further a charged scheme if it
‘lulls’ the victim into a false sense of security or otherwise assists the defendant[s]
in avoiding detection.” United States v. Villazan, No. 05 CR 792, 2007 WL 541950,
at *7 (N.D. Ill. Feb. 15, 2007) (citations omitted). That is, “[w]ire communications
that are designed to lull victims into a false sense of security, postpone inquiries
or complaints, or make the transaction less suspect are communications in
31
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Defendants also assert that Counts Seven and Nine and Counts Eight and
Ten are multiplicitous, since Counts Seven and Nine “both relate[] to the same
transaction[ of] causing a cashier’s check in the amount of $350,000 from TD Bank
to be deposited into an O&M Halyard bank account,” while Counts Eight and Ten
“charge the same transaction[ of] causing a cashier’s check in the amount of
$720,000 from TD Bank to be deposited into an O&M Halyard bank account.”
[Doc. 105 at 5 (citations omitted)]. Counts Seven and Eight of the superseding
indictment charge defendant with money laundering, in violation of 18 U.S.C. §
1956(a)(1)(A)(i), see [Doc. 58 ¶¶ 30-33], while Counts Nine and Ten charge
defendants with money laundering, in violation of 18 U.S.C. § 1957, see [id. ¶¶ 34-
37].
Section 1956(a)(1)(A)(i) provides:
(a)(1) Whoever, knowing that the property involved in a financial
transaction represents the proceeds of some form of unlawful activity,
conducts or attempts to conduct such a financial transaction which in
fact involves the proceeds of specified unlawful activity--
(A)(i) with the intent to promote the carrying on of specified
unlawful activity. . . .
furtherance of the fraudulent scheme,” and the superseding indictment alleges a
scheme to defraud and the emails in Counts One through Four “furthered that
scheme.” United States v. Washburn, 862 F. Supp. 2d 871, 886 (N.D. Iowa 2012)
(citation and internal marks omitted), aff’d, 728 F.3d 775 (8th Cir. 2013); see also
[Doc. 58]. In short, “[r]ead in a common sense fashion,” the superseding
“indictment sufficiently alleges the requisite elements of a wire fraud charge under
the lulling theory.” Braeger, 2023 WL 2136722, at *8 (citation omitted).
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18 U.S.C. § 1956(a)(1)(A)(i). Section 1957 provides, in relevant part:
(a) Whoever, in any of the circumstances set forth in subsection
(d),[13], knowingly engages or attempts to engage in a monetary
transaction in criminally derived property of a value greater than
$10,000 and is derived from specified unlawful activity, shall be
punished as provided in subsection (b).
18 U.S.C. § 1957(a).
Thus, § 1956(a)(1)(A)(i), as charged in Counts Seven and Eight of the
superseding indictment, requires the government to prove that defendants: “(1)
conducted a financial transaction (such as purchasing property) with the proceeds
of ‘specified unlawful activity’ (2) with the knowledge that the proceeds came
from ‘some form of unlawful activity’ and (3) with the intent ‘to promote the
carrying on of specified unlawful activity,’” United States v. 275 Milton Rahn Rd.
Rincon, Ga. 31326, CIVIL ACTION NO.: 4:18-cv-299, 2022 WL 969621, at *6 (S.D.
Ga. Mar. 30, 2022) (citations omitted), whereas under § 1957, the government must
prove that: “(1) [] defendant[s] ‘knowingly engaged or attempted to engage in a
monetary transaction in criminally derived property that is of a value greater than
$10,000,’ and (2) the property ‘is derived from specified unlawful activity,’” United
13 “The circumstances referred to in subsection (a)” include “that the offense . . .
takes place in the United States or in the special maritime and territorial
jurisdiction of the United States[]” or “that the offense . . . takes place outside the
United States and such special jurisdiction, but the defendant is a United States
person[.]” 18 U.SC. § 1957(d)(1)-(2).
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States v. Forehand, 577 F. App’x 942, 947 (11th Cir. 2014) (per curiam)
(unpublished) (alterations and citation omitted). Thus, “§§ 1956 and 1957 each
require proof of additional facts not required by the other.” United States v.
Caruso, 948 F. Supp. 382, 390 (D.N.J. 1996).
Defendants acknowledge that “promotional money laundering and
transactional money laundering contain slightly different elements,” but they
nonetheless argue the counts are multiplicitous because “they contain the same
unit of prosecution—a single financial transaction” that “is charged in multiple
counts[.]” [Doc. 105 at 6]; see also [Doc. 114 at 4 (citation omitted) (arguing that
the superseding “indictment was multiplicitous because one single transaction is
charged in Counts [Seven] and [Nine], and one single transaction is charged in
Counts [Eight] and [Ten]”). However, for the reasons that follow, defendants’
argument fails.
As previously noted, “[a]n indictment is multiplicitous if it charges a single
offense in more than one count,” but “[c]ourts which have addressed this issue
have found that violations of § 1956 and § 1957, while likely based on the same
conduct, represent two distinct offenses, each with different elements.” United
States v. Huber, No. CR. C3–00–76, 2002 WL 257851, at *4 (D.N.D. Jan. 3, 2002)
(citing United States v. Hill, 167 F.3d 1055, 1069-70 (6th Cir. 1999); Caruso, 948 F.
Supp. at 390-91; United States v. Ferrouillet, No. CriM.A. 96-198, 1996 WL 684461,
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at *1-2 (E.D. La. Nov. 26, 1996)); see also Hill, 167 F.3d at 1070 (citations omitted)
(explaining that “§ 1957 offenses are not lesser-included offenses of § 1956”).14
“The Court fully adopts the reasoning articulated in these cases, since it has found
no cases that support a contrary finding,” and concludes “that the [superseding]
indictment with respect to these counts [is] not multiplicitous.” Huber, 2002 WL
257851, at *4; see also Caruso, 948 F. Supp. at 390 (finding that because “§§ 1956
14 Although the evidence may be the same to prove the violations asserted in the
counts at issue, in applying the Blockburger test, the focus is on the statutory
elements of the offense, not the specific facts presented by the government to prove
the offenses. See Albernaz v. United States, 450 U.S. 333, 338 (1981); United States
v. Buckingham, Case No.: 4:18-cr-00376-RDP-JEO-2, 2018 WL 6570874, at *4 (N.D.
Ala. Dec. 13, 2018) (emphasis and citation omitted) (explaining that “there is
nothing improper about reciting the same factual allegations in different counts of
an indictment where those facts show the defendant committed two or more
distinct statutory offenses” as the “multiplicity doctrine guards against charging a
single offense in more than one count of the indictment,” but it “does not prohibit
restating similar factual allegations in more than one count of the indictment, a
practice explicitly contemplated by the Federal Rules of Criminal Procedure”).
Here, each statutory provision requires proof of an additional fact not required by
the other. See Hill, 167 F.3d at 1069-70 (citation omitted) (explaining that the
“$10,000 threshold is not an element of proof for the §1956(a)(1)[] money
laundering charges”; that “money laundering offenses under §§ 1956(a)(1)[] and
1957 have different scienter requirements; [and that] § 1957 does not require that
the defendant[s] know that the transaction was designed to conceal or disguise the
nature, location, source, ownership or control of the subject proceeds . . .”);
Ferrouillet, 1996 WL 684461, at *1 (finding the counts at issue charging violations
of §§ 1956 and 1957 were “not multiplicitous based on the different elements in
each offense, the legislative history, and the treatment of multiplicitous claims on
other § 1956 contexts”).
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and 1957 each require proof of an element which is not required by the other,” the
“two statutes constitute different offenses, and it is not multiplicitous to charge the
offenses in different counts”). Accordingly, defendants’ joint motion to dismiss
multiplicitous counts, [Doc. 105], is due to be denied.15
2. Failure to Allege a Crime
Defendants also move to dismiss the wire fraud counts, [Doc. 115], for
failure “to properly charge any conduct under the lulling exception,” [id. at 1].
Norkus also moves to dismiss the money laundering counts from the superseding
indictment, [Doc. 103], for failure to “charge the crime of money laundering,” [id.
15 While the Court finds that the challenged counts are not multiplicitous for the
reasons discussed, even if “[a]n indictment . . . charging the same offense in more
than one count is multiplicitous,” it is “not fatal and does not require dismissal of
the indictment,” United States v. Siegelman, 2:05 CR 119 MEF, 2006 WL 752951, at
*3 (M.D. Ala. Mar. 22, 2006) (alterations in original) (footnote, citation, and internal
marks omitted). Indeed, “there are less severe remedies available to alleviate
potential prejudice,” including “by offering appropriate instructions to the jury.”
Id. (citation omitted); see also United States v. Pefanis, Criminal Action No. 1:10–
CR–0513–RWS–CCH, 2011 WL 1134310, at *3 (N.D. Ga. Mar. 1, 2011) (citation
omitted), adopted by 2011 WL 1113954, at *1 (N.D. Ga. Mar. 25, 2011). In fact,
“should the evidence at trial demonstrate that the charges were improperly
multiplied, the trial court can still remedy any violation by consolidating the
counts or requiring dismissal,” and, “even after a verdict, any error may be
remedied by vacating multiplicitous convictions and any concurrent convictions
based upon those convictions.” United States v. Ford, Criminal Action No. 1:12–
CR–297–TWT–ECS–1, 2013 WL 1337130, at *2 n.3 (N.D. Ga. Mar. 5, 2013) (citations
omitted), adopted by 2013 WL 1320739, at *1 (N.D. Ga. Mar. 29, 2013), aff’d, 784
F.3d 1386 (11th Cir. 2015); see also Bobo, 2007 WL 962978, at *4.
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at 5], and Sperber has moved to adopt this motion, [Doc. 106]. The government
opposes both motions, [Docs. 109 & 125], and defendants have filed replies in
support of the motions, [Docs. 113 & 127].
“‘An indictment is valid if it contains the elements of the offense intended
to be charged.’” United States v. Honeycutt, Criminal Action No. 2:12–CR–00022–
RWS, 2014 WL 2003029, at *4 (N.D. Ga. May 14, 2014) (quoting Williams, 181 F.
App’x at 949), adopted at *1. “An indictment is sufficient if it: (1) presents the
essential elements of the charged offense, (2) notifies the accused of the charges to
be defended against, and (3) enables the accused to rely upon a judgment under
the indictment as a bar against double jeopardy for any subsequent prosecution
for the same offense.”16 United States v. Aydin, Criminal Case No. 1:12–CR–221–
2–ODE–AJB, 2015 WL 927666, at *7 (N.D. Ga. Mar. 3, 2015) (citations and internal
marks omitted), adopted at *5; see also Fed. R. Crim. P. 7(c)(1) (“The indictment . .
16 “[I]f the indictment tracks the language of the statute, it must be accompanied
with such a statement of the facts and circumstances as will inform the accused of
the specific offense, coming under the general description, with which he is
charged.” United States v. Slawson, Criminal Case No. 1:14–CR–00186–RWS–JFK,
2014 WL 5804191, at *5 (N.D. Ga. Nov. 7, 2014) (citations and internal marks
omitted), adopted by 2014 WL 6990307, at *1 (N.D. Ga. Dec. 10, 2014). And, “[i]n
judging the sufficiency of an indictment, courts are cautioned to use a broad and
enlightened standpoint of common sense and right reason rather than [a] narrow
standpoint of petty preciosity, pettifogging, technicality or hair splitting fault
finding.” Id. (second alteration in original) (citations and internal marks omitted).
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. must be a plain, concise, and definite written statement of the essential facts
constituting the offense charged[.]”). “‘In ruling on a motion to dismiss for failure
to state an offense, a district court is limited to reviewing the face of the indictment,
and more specifically, the language used to charge the crimes.’” Honeycutt, 2014
WL 2003029, at *4 (emphasis omitted) (quoting United States v. Sharpe, 438 F.3d
1257, 1263 (11th Cir. 2006)); see also United States v. Kopp, Criminal Action No.
1:12–CR–0269–RWS, 2014 WL 2154199, at *4 (N.D. Ga. May 21, 2014) (alteration in
original) (citation and internal marks omitted) (“It is well-settled that a court may
not dismiss an indictment . . . on a determination of facts that should have been
developed at trial”), adopted at *1, aff’d, 778 F.3d 986 (11th Cir. 2015).
a. Wire Fraud Counts
Defendants “move to dismiss the wire fraud counts because they fail to
properly charge any conduct under the lulling exception.” [Doc. 115 at 1]. In
particular, defendants contend that “there is no indication in the [superseding]
indictment that people who had been defrauded—Victims A and B—had any
knowledge of the emails sent to O&M Halyard, or that any communication with
O&M Halyard would have any effect on whether Victims A and B discovered the
fraudulent scheme” and that it “is unclear how emails promising to pay O&M
Halyard could prevent either Victims A and B or O&M Halyard from discovering
any alleged fraud.” [Id. at 4 (emphasis omitted)]. Defendants therefore assert that
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because the superseding “indictment fails to contain any explanation of how the
emails charged in the wire fraud counts could fall under the ‘lulling exception,’
the indictment should be dismissed as to those counts.” [Id.].17
In response, the government contends that defendants have “fail[ed] to
point to any authority for the proposition that lulling emails must be sent directly
to the victim of the offense,” but rather, “if the wiring was used to lull the scheme’s
victims, then the lulling exception has been met.” [Doc. 125 at 5 (internal marks
omitted)]. The government also points out that defendants “wrongfully assume
that O&M Halyard was not an intended victim of this offense,” explaining that
their “fraud scheme had multiple stages,” including that Sperber failed to pay
O&M Halyard money for previously shipped PPE; that defendants fabricated
emails to Victim A, inducing that victim to send money for PPE; that defendants
then induced Victim B to send money by falsely claiming they would deliver PPE
from O&M Halyard and Dukal; and that Sperber used a portion of the funds
received from the victims to pay down the debt owed to O&M Halyard and while
doing so, sent a series of false and misleading emails to O&M Halyard employees
17 Defendants also maintain that because they filed this motion “within two weeks
of the government’s disclosure that it is proceeding under the lulling exception,”
the motion is timely filed even though it was filed after the pretrial motions
deadline. [Doc. 115 at 1 n.1].
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in order to lull O&M Halyard into thinking that the debt had been or would be
paid. [Id. at 7-9 (citations omitted)].
Defendants have filed a reply in support of their motion, [Doc. 127], in
which they clarify that their position is not that to be properly charged under the
lulling exception, the wires must have been directed toward the victims of the
scheme, but instead, they argue “that the [superseding] indictment, as written,
does not charge or explain how the wire fraud counts could fall under the ‘lulling
exception,’” [id. at 1 (citation omitted)]. Specifically, defendants assert that the
superseding “indictment [does] not contain any allegations that the emails in
question were used to delay detection of the fraud,” and they simply maintain
“that there had to be some allegation that the e-mails somehow ‘lulled’ the victims
into not discovering the fraud.” [Id. at 2 (citation omitted)]. Defendants explain
that “[i]f O&M Halyard is the victim, it is unclear how the lulling exception applies
because there was no separate fraud toward O&M Halyard other than the promise
to pay for materials received,” but that if “the e-mails to O&M Halyard were
somehow supposed to ‘lull’ Victims A and B from discovering the fraud,” there
“is no allegation that the e-mails in question had any effect on delaying the
discovery of the alleged fraud as to Victims A and B,” and “they are not properly
charged under the ‘lulling exception’ either.” [Id. at 3-4].
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Despite defendants’ arguments to the contrary, “[r]ead in a common sense
fashion, the [superseding] indictment describes an overarching scheme in which
defendant[s] sought to defraud [O&M Halyard and Victims A and B].” Braeger,
2023 WL 2136722, at *8. Indeed, the superseding incitement alleges that
defendants “engaged in a scheme to defraud a PPE supplier [(O&M Halyard)] as
well as victims [(Victims A and B)] who sought to procure PPE for hospital and
medical institutions”; that Sperber failed to pay O&M Halyard for previously
shipped PPE at which time O&M Halyard employees advised him that in order to
remain an authorized dealer, he had to pay down his balance; that defendants sent
false O&M Halyard emails and invoices to Victim A regarding the availability of
PPE supplies, causing Victim A to wire funds to Norkus’ company, a portion of
which Norkus used to purchase a condominium and Sperber used to pay down
his balance with O&M Halyard in order to remain an authorized dealer to enable
defendants to be in a position to commit additional acts of fraud, although the
funds were to be used to purchase PPE; that defendants led Victim B to believe
that they could acquire a substantial amount of PPE from O&M Halyard and
Dukal, causing Victim B to wire over $13 million for the purchase of PPE supplies,
despite having been informed by O&M Halyard representatives that the quantity
requested was not possible; that throughout the relevant period, defendants
misappropriated Victims A and B’s funds, including Sperber using portions of the
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funds to pay down his outstanding balance with O&M Halyard that had been
incurred prior to February 2020 and involved sending O&M Halyard employees
emails representing that Sperber was wiring funds to O&M Halyard for previous
shipments without disclosing that the funds were from prospective PPE purchases
who were expecting to receive PPE; and that once the fraud scheme began to
unravel in mid-2020, Sperber threatened O&M Halyard with a false press release
and then initiated a lawsuit against O&M Halyard. [Doc. 58 ¶¶ 9-11, 13-18, 20-21,
23, 29]. In the paragraph charging the wire fraud counts, the superseding
indictment further alleges that defendants, “for the purpose of executing and
attempting to execute the [] scheme and artifice to defraud,” continued their
deception by sending a series of emails to O&M Halyard employees regarding the
transfer of funds in order to cause them to believe that the outstanding debt has
been or would be paid so that they would remain authorized distributors for O&M
Halyard and conceal their alleged fraudulent activities to reduce the likelihood of
jeopardizing their scheme and in order to be in a position to commit further
fraudulent acts. [Id. ¶ 24]; see also [id. ¶ 29].
“[A] single fraud scheme may be multi-faceted and have more than one
victim or object, and, indeed, may violate more than one criminal statute,” and “a
lulling email sent after the money has been obtained can give rise to liability for
wire fraud[.]” Braeger, 2023 WL 2136722, at *8-9 (citations omitted). Quite simply,
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the superseding indictment “allege[s] that the scheme, . . . as [] carried out,
included fraudulent activities both before and after the victims had [] given over
their money to the defendants,” and that “[i]t was further a part of the scheme . . .
. by false and fraudulent statements to make the victims believe that the
defendants had faithfully performed and would continue to perform the promised
services.” United States v. Sampson, 371 U.S. 75, 78 (1962). That is, the emails
were “sent directly by [Sperber] in furtherance of the scheme because [they were]
specifically intended to assuage and lull [O&M Halyard] regarding the allegations
of fraud and to evade detection,” and the superseding indictment here,
“sufficiently tracks the elements of the statute and notifies [d]efendants of the
nature of the charge and the wire transmission[s] at issue.” United States v.
Alfortish, Criminal No. 10–328, 2011 WL 2293136, at *4 (E.D. La. June 8, 2011).
“Defendants may argue at trial that the . . . email[s were] not sent in furtherance
of the fraud and move for acquittal if the evidence is insufficient, but that
argument does not warrant dismissal of the [wire fraud counts] at this stage[.]”
Id.
While defendants argue that the superseding indictment does not “explain
how the wire fraud counts could fall under the ‘lulling exception,’” [Doc. 127 at 1],
the “substance behind [defendants’] argument . . . has nothing to do with the
adequacy of the [g]overnment’s accusations as set forth in the [superseding]
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indictment,” United States v. Wrobel, 12-CR-125W, 2017 WL 3097611, at *6
(W.D.N.Y. July 21, 2017), and defendants’ “view of the [superseding] indictment .
. . asks the Court to ignore the allegations . . . [and] the [] statute-tracking
allegations that the case law indicates is sufficient,” United States v. Rhame,
CRIMINAL ACTION NO. 1:16-CR-67-SCJ-CMS, 2017 WL 9474217, at *5 (N.D. Ga.
Jan. 31, 2017) (citation omitted), adopted by 2017 WL 5591273, at *8 (N.D. Ga. Nov.
20, 2017). “Although, the [superseding i]ndictment does not specify that
[d]efendant[s] sent the email[s] to lull [O&M Halyard, or any other victims,] or
avoid detection, it does state that [d]efendant[s] sent the email[s]” for the purpose
of executing the scheme to defraud by paying down the outstanding balance, or
leading O&M Halyard to believe they would do so, to pacify O&M Halyard so
that Sperber could remain an authorized distributor, and the Court “finds that
[the] allegation[s are] sufficient to establish that the wire message[s were] in
furtherance of the scheme for purposes of indicting [d]efendant[s].” United States
v. Martin Wynn, Cr. No. 8:10–cr–1026–GRA, 2011 WL 1748424, at *5 (D.S.C. May
2, 2011); see also [Doc. 58 ¶¶ 10, 17-18, 24, 29]. Thus, the superseding “indictment
sufficiently alleges a fraud scheme directed at [O&M Halyard, as well as others],
so the lulling caselaw is applicable to the wire transmission charged in [C]ount[s
One through F]our,” Braeger, 2023 WL 2136722, at *9, and defendants’ motion to
dismiss these counts, [Doc. 115], is due to be denied.
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b. Money Laundering Counts
Defendants next contend that the Court “should dismiss the money
laundering counts because they fail to charge the crime of money laundering.”
[Doc. 103 at 5]. In particular, defendants argue that because these counts “plainly
involve transactions that predate the completion of the alleged fraudulent
scheme—and well before any of the substantive wire fraud counts,” the
“underlying predicate acts did not predate—and were certainly not complete—
prior to the transactions that form the basis for the money laundering counts.”
[Id.].18
The government responds that while defendants “claim that the money
laundering counts must fail because the substantive wire fraud offenses post-date
the alleged money laundering transactions,” they “incorrectly assume[] that
because the dates of the charged wire fraud offenses occurred after the charged
money laundering offenses, there could be no completed specified unlawful
activity (and, therefore, no ‘proceeds’ to launder),” but because the “substantive
18 Defendants also maintain that the motion to dismiss the money laundering
counts is timely since they were given until the date of the filing to perfect the
motion to dismiss multiplicitous counts and they “did not recognize the need to
file the motion until [they were] researching the perfected multiplicitous
motion[.]” [Doc. 103 at 6-7]. The government “has no objection to the Court
reaching the merits of the defendants’ motion and does not take the position that
it should be denied as untimely.” [Doc. 109 at 2 n.1]. Therefore, the Court will
consider the motion timely filed and address the merits.
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wire fraud charges in the [superseding] indictment relate to lulling emails sent by
Sperber to O&M Halyard employees in furtherance of the overall wire fraud
scheme” and, as previously discussed, pursuant to the lulling exception, “a wire
transfer subsequent to a defendant obtaining control of fraudulently obtained
funds may be considered part of the fraudulent scheme if it was used to lull the
scheme’s victims into a false sense of security that they are not being defrauded,
thereby allowing the scheme to go undetected,” defendants’ motion “should be
denied.” [Doc. 109 at 4-5, 8 (emphasis, citations, and internal marks omitted)]. The
government also asserts that while defendants “incorrectly assume that the
proceeds alleged in the money laundering counts were derived from the[] ‘lulling’
emails,” the “plain language of the [s]uperseding [i]ndictment is clear: each money
laundering transaction involved the proceeds of wire fraud conspiracy and wire
fraud,” including that the superseding indictment alleges “that the money
laundering transactions involved the funds that the defendants had previously
obtained unlawfully from Victim A.” [Id. at 5-6 (citing [Doc. 58 ¶¶ 11, 31])]. The
government further contends that “there is no requirement that the specified
unlawful activity even be separately charged in the indictment,” but nonetheless,
the “[s]uperseding [i]ndictment alleges that the money laundering transactions
each involved the proceeds of specified unlawful activity” and satisfy the test for
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“constitutional sufficiency . . . and that is all that is required at this pre-trial stage.”
[Id. at 7-8 (emphasis and citations omitted)].
In their joint reply, defendants contend that “the issue presented here” is
“whether the substantive crime was completed prior to the charged money
laundering,” and because the “government relies on the ‘lulling’ emails allegedly
sent,” the “alleged fraud was ongoing—and certainly extended past the date of the
February 12, 2020 transactions charged as money laundering,” and since “the
fraud was not complete at the time of the transactions alleged in the money
laundering transactions, the money laundering charges cannot stand.” [Doc. 113
at 4-6 (citation omitted)]. Defendants also contend that the “government has
alleged the same transactions as both part of the fraud and as money laundering,”
but the “money laundering charges cannot be premised on the same transactions
that constitute the alleged fraud,” and the “money laundering counts must be
dismissed.” [Id. at 6-7 (citation omitted)].19
As previously discussed, § 1956 makes it unlawful to conduct a financial
transaction involving the proceeds of unlawful activity “with the intent to promote
19 In their joint reply, defendants also clarified that they “mistakenly only
referenced Counts [Seven through Ten], and not the conspiracy to commit money
laundering count charged in Count [Six],” and they “request that the Court
consider [their] arguments and the initial motion as to all money laundering
counts[.]” [Doc. 113 at 1 n.1].
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the carrying on of specified unlawful activity,” 18 U.S.C. § 1956(a)(1)(A)(i), while
§ 1957 makes it unlawful to conduct a financial transaction “of a value greater than
$10,000,” involving the proceeds of unlawful activity, 18 U.S.C. § 1957(a).
“[P]roceeds are derived from an already completed offense, or a complete[d]
phase of an ongoing offense, before they can be laundered.” United States v.
Grasso, 173 F. Supp. 2d 353, 362 (E.D. Pa. 2001) (first alteration in original) (citation
and internal marks omitted).20 “The main issue in a money laundering charge . . .
is determining when the predicate crime becomes a completed offense after which
money laundering can occur.” United States v. Brown, Case No. 3:18-cr-89-J-
34JRK, 2019 WL 1471029, at *3 n.9 (M.D. Fla. Apr. 3, 2019) (citation and internal
marks omitted). Defendants argue that “[b]ecause the fraud was not complete at
the time of the transactions alleged in the money laundering transactions, the
money laundering charges cannot stand.” [Doc. 113 at 4-5 (citation omitted)].
However, for the reasons that follow, defendants’ arguments are unpersuasive
and fail.
20 Additionally, “[t]o prove a conspiracy to commit money laundering, the
government must show that two or more persons agreed to commit a substantive
money laundering violation, and the defendant[s] knowingly and voluntarily
joined the conspiracy.” United States v. Hirmer, Case No. 3:08cr79/MCR, 2009
WL 10726280, at *4 (N.D. Fla. July 14, 2009) (citation omitted).
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“Wire fraud is a specified unlawful activity,”21 but the government “need
not prove the defendant[s] committed the specified unlawful activity,” and it is
also “not required to allege any details about the specified unlawful activity[.]”
Hirmer, 2009 WL 10726280, at *4 (citations omitted). Defendants’ argument fails
because they incorrectly identify the specified unlawful activities upon which the
money laundering charges are predicated. Defendants point to the substantive
wire fraud counts charged in Counts One through Four, see [Doc. 103 at 5], but the
money laundering conspiracy count of the superseding indictment ranges from
2020 to about March 2021, while the money laundering counts charge transactions
that occurred on February 12, 2020, see [Doc. 58 ¶¶ 28, 31, 33, 35, 37]. The
superseding indictment alleges wire fraud as the specified unlawful activity, see
[id.]; however, it also details that defendants sent fabricated emails, text messages,
21 Although the superseding indictment alleges that the specified unlawful activity
includes conspiracy to commit wire fraud and wire fraud, see [Doc. 58 ¶¶ 28, 31,
33, 35, 37], including conspiracy to commit wire fraud “is an incorrect statement
of law because specified unlawful activity . . . does not include wire fraud
conspiracy,” but “this error relates to an ancillary issue and not an essential
element of the [money laundering] conspiracy [or money laundering charges
themselves]” and, “after removing [the] erroneous language, the [superseding
i]ndictment still states an offense.” United States v. Shea, 20 Cr. 412-4 (AT), 2023
WL 4551635, at *3 (S.D.N.Y. July 14, 2023) (citations and internal marks omitted);
see also United States v. Liersch, No. 04CR02521, 2005 WL 6414047, at *11 (S.D.
Cal. May 2, 2005) (“It is undisputed that a conspiracy to commit [mail fraud,
among other offenses,] does not meet the definition of ‘specified unlawful
activity.’”).
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and invoices to Victim A that led to Victim A wiring over $3 million to Norkus’
company for the purchase of PPE with an expected ship date of February 12, 2020,
and that on February 10, 2020, Norkus sent Victim A fabricated bank statement
that falsely claimed Norkus’ company had wired nearly $3 million to O&M
Halyard for the purchase of PPE, but that Norkus actually used a portion of the
funds to purchase a condominium and Sperber used a portion to pay down his
balance with O&M Halyard for previous shipments he still owed, [id. ¶¶ 10-11].
Thus, “the money laundering [counts] alleged in Count[s] [Six through Ten are]
not predicated on the laundering of proceeds of the wire fraud scheme [as
specified] in Count[s One through Four].” United States v. Alabed, CRIMINAL
ACTION FILE NO. 1:19-CR-089-MHC-JSA, 2020 WL 114415, at *2 (N.D. Ga. Jan. 9,
2020) (citation omitted). That is, “where wire fraud and money laundering are
alleged in the same indictment, and wire fraud is the specified unlawful activity
referenced in the money laundering counts, money laundering convictions can
rest on communications other than those that comprise the wire fraud counts.”
United States v. Nickolas, No. CR–12–01927–PHX–NVW, 2014 WL 5811127, at *2
(D. Ariz. Nov. 10, 2014). In fact, defendants do “not have to be charged with the
specified unlawful activity.” United States v. Howard, 271 F. Supp. 2d 79, 83
(D.D.C. 2002) (emphasis and citations omitted); see also United States v. Loe, 248
F.3d 449, 468 (5th Cir. 2001) (explaining that “specified unlawful activity” did not
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“imply that the indictment must list a specific unlawful act that [was] the source
of the money”); United States v. Smith, 44 F.3d 1259, 1265 (4th Cir. 1995) (emphasis
and internal marks omitted) (discussing that “[j]ust because the statute requires
that funds be obtained from specified unlawful activity does not mean that the
government is required to detail the circumstances of the unlawful activity,” but
rather, “the term ‘specified unlawful activity’ is a defined term referring to a list
of offenses which qualify as unlawful activity for purposes of stating a money
laundering offense,” of which wire fraud is included). And, here, the specified
unlawful activity as alleged in the superseding indictment occurred prior to the
charged acts of money laundering, which as the government points out, “involved
the funds that the defendants had previously obtained unlawfully from Victim A.”
[Doc. 109 at 6].
“If one engages in ongoing criminal activity that includes completed
instances of specified unlawful activity, then that completed specified unlawful
activity may be the basis for a money laundering charge even if it is part of a larger
ongoing conspiracy or criminal scheme that continues after the act of money
laundering is committed.” Liersch, 2005 WL 6414047, at *10 (citation omitted). In
fact, while “it is true that the defendant[s] must have control of the proceeds of a
fraudulent transaction before [they] can engage in money laundering with those
proceeds, there is no requirement that the entire fraudulent scheme be complete
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before the defendant[s] start[] laundering the proceeds from early portions of the
scheme,” as “money laundering can be a critical element in a complex fraud
scheme because it helps keep the scheme afloat and helps disguise the source of
the fraud proceeds.” United States v. Seward, 272 F.3d 831, 837 (7th Cir. 2001)
(citations omitted); see also Howard, 271 F. Supp. 2d at 89 (citation omitted)
(explaining that the “underlying criminal conduct from which the laundered
funds were derived need not have been a completed offense when the money
laundering occurred” as “[a]ll the government needs to establish is that the
defendant had possession or control of the funds that were laundered”). Indeed,
“Congress did not intend to allow criminals to lawfully cleanse their ill-gotten
gains simply by engaging in an ongoing conspiracy,” and “[t]o hold otherwise
would be to essentially gut the heart of the statute.” Liersch, 2005 WL 6414047, at
*10; see also United States v. Quan, No. CR 04-0323 VRW, 2006 WL 2619191, at *1
(N.D. Cal. Sept. 12, 2006) (rejecting defendants’ argument “which would prohibit
prosecution for money laundering for transactions which involve the proceeds
from separate, completed acts in an ongoing criminal scheme” because “[s]uch an
interpretation of completed criminal activity would have the court create
immunity from money laundering charges for any transaction that predates the
completion of an ongoing criminal offense or scheme”). Therefore, “[t]here is no
reason why the government [cannot] view the activity charged as money
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laundering as the defendant[s’] attempt to launder the proceeds of the early,
already completed phases of [their] fraudulent scheme and as part of [their]
ongoing effort to defraud . . . and to conceal [their] fraud.” Howard, 271 F. Supp.
2d at 89-90 (citation and internal marks omitted).
“In any event, the incorporated paragraphs of the [superseding] indictment
detail alleged facts that the defendant[s], [prior to February 12, 2020], fraudulently
transferred [ Victim A’s] funds to accounts [they] had under [their] control [prior
to transferring a portion of those funds to O&M Halyard],” and there “being no
requirement that the entire fraudulent scheme be complete before the defendant[s]
start[] laundering the proceeds from early portions of the scheme, the defendant[s]
can properly be charged with money laundering for the earlier actions that helped
comprise [the] fraudulent scheme.” Id. at 90 (alteration, footnote, citation, and
internal marks omitted).22 In sum, the superseding indictment “alleges that
22 Furthermore, “even if details about [the] underlying unlawful conduct were not
set forth in the [superseding] indictment, this would not be grounds for dismissal
. . . because whether the criminally derived proceeds existed before the laundering
transaction is a question of proof, not a question of the adequacy of the
indictment.” Howard, 271 F. Supp. 2d at 90 (citation and internal marks omitted).
“Thus, as long as the indictment contains a plain, concise and definite written
statement of the essential facts constituting the offense charged, [such as is the case
here,] it should not be dismissed for failure to plead in detail the facts establishing
the specified unlawful activity underlying the money laundering charge[s].” Id.
at 84 (alteration, citations, and internal marks omitted).
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[d]efendant[s] reinvested the proceeds of [their] alleged . . . fraud in furtherance of
a continuing scheme,” and it “therefore adequately charges the money laundering
offenses.” Grasso, 173 F. Supp. 2d at 363; see also United States v. Davis, 53 F.4th
833, 844 n.4 (5th Cir. 2022) (alteration, citations, and internal marks omitted)
(explaining that the “statute does not require the indictment to specify which
unlawful activity generated the funds in question,” but instead, “nothing more
need be alleged than that the laundered money was the proceeds of wire fraud”
and that the government “was thus free to pursue seven specific wire-fraud
charges, while nevertheless insisting on the existence of a broader fraudulent
scheme, involving a plethora of fraudulent wires, from which funds were derived
for the four money-laundering charges”); Smith, 44 F.3d at 1265 (finding that even
if the indictment’s wire fraud counts were incorporated by reference into the
money laundering counts, the money laundering counts “would still pass
muster[,]” since a sufficient portion of the wire fraud scheme had been completed
and the fact that the wire fraud scheme “as alleged . . . included further
transactions” did not detract from the fact that once received, the funds
“constituted proceeds derived from an unlawful activity for purposes of a money
laundering offense”); United States v. Sidoo, 468 F. Supp. 3d 428, 435, 445-46 (D.
Mass. 2020) (citation and internal marks omitted) (finding the superseding
indictment sufficiently alleged a money laundering conspiracy where the facts
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alleged that “the scheme operated in stages,” with the defendants allegedly
making payments to two entities used by a co-conspirator who would then in turn
made payments to other alleged corrupt insiders as part of a college admissions
scheme, as there was “no requirement that the underlying crime be completed
before money laundering [could] take place . . . ., so long as the underlying offense
ha[d] progressed to the point of creating proceeds the money bec[a]me[] proceeds
of illegal activities and it [could] be laundered,” meaning, “so long as a phase of
the ongoing offense ha[d] been completed (and ha[d] generated proceeds) a
defendant may be liable for money laundering”), aff’d sub nom. United States v.
McGlashan, No. 21-1421, 2023 WL 5199864 (1st Cir. Aug. 14, 2023); Harned v.
United States, Nos. 7:00–CR–12 WLS, 7:08–CV–90033 WLS, 2010 WL 3198857, at *3
(M.D. Ga. Mar. 19, 2010) (citations and internal marks omitted) (rejecting
defendant’s contention “that the underlying offense, in this case mail and wire
fraud, must have produced proceeds before those proceeds could be laundered”
and that because “the mail and wire fraud had not occurred at the time the funds
were placed into the accounts,” the “placement of the funds could not have been
money laundering because the predicate offenses had not yet occurred,”
explaining that the government “established that prior to obtaining money from
the victims, at least one mailing or wiring to execute the scheme to defraud that
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victim would have occurred”), adopted by 2010 WL 3198853, at *1 (M.D. Ga. Aug.
11, 2010).
Defendants also argue that “[b]ecause money laundering charges cannot be
premised on the same transactions that constitute the alleged fraud, the money
laundering counts must be dismissed.” [Doc. 113 at 6-7 (citing United States v.
Christo, 129 F.3d 578, 580 (11th Cir. 1997) (per curiam))]. Despite defendants’
arguments to the contrary, [Doc. 103 at 5; Doc. 113 at 6-7], the superseding
“indictment . . . is not guilty of a Christo problem,” as the “money laundering
count[s] properly charge[] that [d]efendants engaged in financial transactions that
were separate from and in addition to the underlying criminal activity.” Alabed,
2020 WL 114415, at *2 (citation and internal marks omitted). That is, the
superseding indictment “charges that the activity that dirtied the money is distinct
from the laundering activity.” United States v. Vila, Criminal No. 3:08–cr–297–
PJB, 2009 WL 79189, at *6 (D.P.R. Jan. 9, 2009). The Seventh Circuit’s decision in
Seward, 272 F.3d 831, is illustrative of this point.
In Seward, the Seventh Circuit rejected defendant’s argument “that the
government failed to allege that he engaged in any money-laundering transactions
that were distinct from the bank, mail, and wire fraud scheme,” explaining that
the “transactions [at issue] demonstrate[d] both unlawful activity and distinct
transactions in the criminally derived proceeds,” since “[w]hen the defendant
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impersonated the decedent and defrauded the Bank into transferring the
decedent’s CD proceeds to the joint account, the defendant committed bank and
wire fraud,” and “[t]hat act of fraud was complete and the defendant had control
over the proceeds of the fraud, once the money was placed in the joint account,”
and the “checks the defendant then wrote on the account were, therefore,
transactions in the proceeds of the bank fraud.” Howard, 271 F. Supp. 2d at 86-87
(alterations and citations omitted). “Although the activity alleged in the
[superseding] indictment as constituting the money laundering activity is also
alleged in the [wire fraud] counts . . ., as long as there is separate underlying
unlawful activity that gave rise to the proceeds charged . . .,” defendants do “not
suffer prejudice for the indictment’s failure to specify conduct separate from the
underlying criminal activity.” Id. at 87 (citation and internal marks omitted). In
short, the “wire transaction[s] that serve[] as the basis for [defendants’] wire-fraud
charge[s] . . . [are] separate and apart from the monetary transactions supporting
the money-laundering charges[.]” United States v. Huff, 641 F.3d 1228, 1233 (10th
Cir. 2011); see also United States v. Nolan, 223 F.3d 1311, 1316 (11th Cir. 2000) (per
curiam); United States v. Booth, 583 F. Supp. 3d 545, 549 (S.D.N.Y. 2022); United
States v. Happ, No. CR2-06-129(8), 2008 WL 5101227, at *5 (S.D. Ohio Nov. 25,
2008).
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“A motion to dismiss challenges the sufficiency of the pleadings, not proof
at trial.” Medina-Rodrìguez v. $3,072,266.59 in U.S. Currency, 471 F. Supp. 3d 465,
481 (D.P.R. 2020) (citation and internal marks omitted). “On its face, the
[superseding i]ndictment contains all necessary elements of the money laundering
[] charge[s], fairly informs [d]efendant[s] of the charge[s] against which [they]
must defend, and enables [defendants] to plead an acquittal or conviction in bar
of future prosecutions for the same offense,” which “is enough to satisfy the
requirements of Rule 7(c)(1),” Shea, 2023 WL 4551635, at *3 (citation and internal
marks omitted), and the pending motion to dismiss the money laundering counts
for failure to allege a crime, [Doc. 103], is due to be denied. Accordingly, it is
RECOMMENDED that defendants’ motions to dismiss, [Docs. 103, 105, & 115],
be DENIED.
C. Norkus’ Motion to Suppress Statements, [Doc. 97]
Norkus contends that the statements he made in a social room in his
condominium building on March 10, 2021, should be suppressed because the
interview occurred in violation of Georgia’s Rules of Professional Conduct and
encroached on his attorney-client relationship. [Doc. 142 at 18-22]. He also
contends that the Court erred in prohibiting him from questioning the witness at
the evidentiary hearing about knowledge of Norkus’ representation by counsel at
the time of the March 2021 interview and requests that the Court reopen the
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evidentiary hearing and allow him to address the issue. [Id. at 16-18]. Finally,
Norkus contends that his statements were not voluntary and therefore should be
suppressed. [Id. at 22-25].23
In response, the government argues that Norkus’ motion is due to be denied
because “the evidence at the suppression hearing demonstrates that the interview
was voluntary”; Norkus “fails to show that the [government] violated Georgia
Rule of Professional Responsibility 4.2 and ignores binding Eleventh Circuit
precedent, which states suppression is not permitted if the ethical rules are in fact
violated”; and Norkus’ request to reopen the evidentiary hearing should be denied
and “he should not be permitted to present additional evidence.” [Doc. 143 at 2-
3, 9]; see also [id. at 6-20]. Norkus has filed a reply in support of his motion to
suppress statements, [Doc. 144], and the Court will address the parties’ arguments
in turn.
23 In his initial motion to suppress, [Doc. 97], Norkus referenced Miranda v
Arizona, 384 U.S. 436 (1966), [id. at 2]. “[O]ut of an abundance of caution,” the
government addressed whether Norkus’ Miranda rights were violated and argued
that Norkus was not in custody at the time of his interview on March 10, 2021.
[Doc. 143 at 2 n.2, 3-6]; however, in his reply, Norkus concedes that he was not in
custody at the time of his interview on March 10, 2021, see [Doc. 144 at 1]. Thus,
the Court need not address this argument.
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1. Statement of Facts
On the morning of March 10, 2021, Atlanta-based Federal Bureau of
Investigation (“FBI”) Special Agents Bradley Rhoden (“Agent Rhoden”) and
Stephen Ryskoski (“Agent Ryskoski”) arrived at Norkus’ condominium building
in Hillsboro Beach, Florida, and pressed the call button on the intercom system at
the front of the building and spoke with Norkus’ wife, who relayed that Norkus
was in the sauna. (Tr. at 3-7, 9, 26). The agents, who identified themselves to
Norkus’ wife, informed her that they wanted to speak with Norkus, provided her
with Agent Rhoden’s contact number, and then returned to their vehicle to wait
for Norkus’ call. (Tr. at 10, 18). About fifteen minutes later, Norkus contacted the
agents, and they informed him that they wanted to speak to him regarding
financial transactions that took place between Craig Curry (“Curry”), a victim of
the alleged scheme, and Sperber. (Tr. at 10, 19, 26). Norkus agreed to speak with
them and suggested that they meet in the foyer of his condominium building, and
after the agents introduced themselves, Norkus led them to a “social room or club
room” located on the first floor of the building. (Tr. at 10-11, 19).24
24 Agent Rhoden described the “social room” as a “medium-sized room” that “was
large enough to have multiple tables” and had windows from which the ocean
was visible. (Tr. at 11-12). The agents and Norkus sat down at a table in the room,
with Norkus’ back to the exit of the room. (Tr. at 12). At this time, the agents
placed a recording device in plain view on the table and began recording the
interview. (Tr. at 5-6, 13, 19; Gov’t Ex. 1).
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At the beginning of the interview, Norkus informed the agents that he knew
Sperber, that it had been a couple of weeks since he had spoken with him, that he
was a “little” upset because he had found out “some stuff,” and he was meeting
with his lawyer later that day as he was involved in two civil lawsuits because of
Sperber. (Gov’t Ex. 1 at 00:08-00:35). Norkus described his relationship with
Sperber, including that Sperber had a distribution business and would set up the
deals with the manufacturers, and explained that his role was also to bring the
customers and handle logistics at the warehouse, but that he was not involved in
the “financials.” (Gov’t. Ex. 1 at 00:43-01:14). He also discussed the deal with
Curry, his relationship with Curry from his “younger days,” and Sperber’s
inability to get PPE products out of the country after a stop order was put into
place. (Gov’t. Ex. 1 at 01:25-02:00, 02:15-14:00). About fourteen minutes into the
interview, Norkus referenced Sperber’s attorney, at which time Agent Rhoden
stated, “Yeah, if he told you, I don’t want to hear what his attorney told him or
anything.” (Gov’t Ex. 1 at 14:05-14:16). Agent Ryskoski asked Norkus about the
civil lawsuits, and Norkus explained that his attorney was “working on that
because [Sperber] owes money on that to [his] company because that company
wired [him] and [he] took care of it with [Sperber], and that goods never came in,
but [Sperber] did wire money back, but not all of it.” (Gov’t Ex. 1 at 16:55-17:14).
Norkus further explained that he had entered into a settlement agreement on one
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of the civil lawsuits, and that despite Sperber agreeing to pay him back, he had not
yet done so. (Gov’t Ex. 1 at 17:15-17:25). Norkus also indicated that he believed
the agents were there to discuss the Curry deal, and he then provided further
details about his knowledge of that deal. (Gov’t Ex. 1 at 17:34-18:35). Norkus also
stated that he had not spoken to Sperber in a while because he was “upset” and
that he had spoken to his attorney and had a meeting with him later that day with
regard to the civil lawsuit as he was “trying to get things worked out,” but that
Sperber “got himself in a pickle here.” (Gov’t Ex. 1 at 21:00-21:41).
During the interview, Norkus asked the agents whether they had spoken to
Sperber, and they explained that they wanted to talk with him first. (Gov’t Ex. 1
at 25:37-25:50). Agent Rhoden also inquired as to whether Norkus had any
information from O&M Halyard and showed him a bank statement regarding a
wire transaction, and Norkus explained what happened and responded, “Yeah,
okay, this is one of the things that I had a problem with . . . . I just found this out
from my attorney.” (Gov’t Ex. 1 at 26:55-29:08). Norkus continued by stating, “Let
me tell you something why I’m upset, one of the reasons I’m upset about it. I just
had a conversation with my attorney,” at which time Agent Rhoden interrupted
and said that they did not want to hear anything he had told his attorney. (Gov’t
Ex. 1 at 29:21-29:30). Norkus continued speaking with the agents and thereafter
explained the process of receiving orders with Sperber and others and when he
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subsequently discovered that a document was “bogus.” (Gov’t Ex. 1 at 29:31-
32:08).
At approximately thirty-three minutes into the interview, Agent Ryskoski
reminded Norkus that they were federal agents and that lying to them could be a
crime. (Gov’t Ex. 1 at 32:59-33:05). He also informed Norkus that there was a
“grand jury investigation going on right now up in Atlanta related to this whole
case.” (Gov’t Ex. 1 at 33:06-33:11). Norkus responded by asking, “What case?,”
and Agent Ryskoski replied, “This whole thing that we’re talking about here.”
(Gov’t Ex. 1 at 33:11-33:17). Norkus followed up by asking, “With [Sperber] and
everything?,” and Agent Ryskoski replied, “Right.” (Gov’t Ex. 1 at 33:17-33:20).
Agent Rhoden also responded, “[Sperber] and everything.” (Gov’t Ex. 1 at 33:16-
33:18).
Norkus continued to provide the agents details about certain documents he
admitted were “not accurate,” at which time Norkus asked whether the agents
would be speaking with Sperber next, but the agents reiterated that they were
speaking with him first. (Gov’t Ex. 1 at 34:00-34:26). At about forty-one minutes
into the interview, Norkus confirmed that he and Sperber held a conference call in
which Sperber pretended to be a representative from O&M Halyard in order to
pacify the customer, and Agent Rhoden stated, “But, you know this is wrong and
it’s fraud,” and he continued by again telling Norkus that they were speaking with
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him first and that they were looking for his cooperation and that “this [did] not
look good.” (Gov’t Ex. 1 at 41:17-43:33). Later in the interview, Agent Rhoden
stated that they wanted to know what Sperber knew and thought Norkus could
help them and that it seemed like Norkus was doing the hard work at the
warehouse while Sperber was flying around on private jets. (Gov’t Ex. 1 at 48:08-
48:44). Agent Rhoden also stated, “I mean, to me that sounds like somebody that’s
using you for this, but you do have to own up to some of these things. This [] looks
really bad.” (Gov’t Ex. 1 at 48:55-49:10). Agent Ryskoski also reiterated that they
were looking for his cooperation and that part of it was Norkus owning up and
telling them about the conversations he had with Sperber. (Gov’t Ex. 1 at 51:45-
51:53).
The agents also questioned Norkus about using funds from a deal to
purchase his condominium and about customers not receiving their products, at
which time Norkus said that he was working on getting that taken care of and that
his “attorney says,” but Agent Ryskoski interrupted him and said that he did not
want to hear about that, and then Norkus continued by explaining that he was
working on a settlement agreement and that he was going to cover it but that
Sperber was supposed to “cover him.” (Gov’t Ex. 1 at 56:00-56:30). Agent
Ryskoski asked Norkus if he had anything to say about various fake documents,
and Norkus responded that he did not because Sperber did not tell him the truth,
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and then he started to say what his attorney said, at which time Agent Ryskoski
again interrupted him. (Gov’t Ex. 1 at 1:00:19-1:01:08). Agent Ryskoski
commented that there was a “lot of fraudulent stuff here,” and Agent Rhoden then
indicated that they wanted to know which documents were doctored by him and
which were doctored by Sperber because what was going to happen was that
Sperber would point his finger at Norkus “all day” and that Norkus needed to tell
them “more about [Sperber].” (Gov’t Ex. 1 at 1:08:11-1:10:15). The interview,
which lasted about an hour and twenty minutes, concluded with Agent Rhoden
advising Norkus that it would be in his best interest to continue to cooperate
because it was important for him to realize that “a lot of this [was] flowing
downhill.” (Gov’t Ex. 1 at 1:16:35-1:16:54). The agents then served Norkus with a
grand jury subpoena for documents from his company, Champion Resources, and
he was not arrested or otherwise placed in custody on that day. (Tr. at 15, 17; Gov’t
Ex. 1 at 1:17:09-1:19:28).25
At the time of the interview, both agents, who were dressed in “slacks and
pullovers,” were armed with their standard-issue handguns, which remained
holstered on their hips and were never displayed. (Tr. at 7-8). The tone of the
25 During the interview, Norkus agreed to show the agents his telephone upon
their request so they could confirm Sperber’s contact number, and while the agents
took a picture of his phone screen with Sperber’s contact information on it, they
never seized Norkus’ phone. (Tr. at 16; Gov’t Ex. 1 at 37:22-40:53).
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interview was cordial and polite, with Norkus displaying a friendly demeanor
throughout the interview, and the agents never physically touched or threatened
Norkus or patted him down, and he was not restrained in any way. (Tr. at 14-15,
17, 21, 30); see generally (Gov’t Ex. 1). During the interview, Norkus seemed to
understand everything that was being asked of him and did not appear to be
under the influence of drugs or alcohol, nor did he request that the agents cease
interviewing him or express a desire to leave.26 (Tr. at 16-17); see generally (Gov’t
Ex. 1). Agent Rhoden testified that Norkus was never promised immunity or
leniency if he agreed to speak with them, and he never advised Norkus that he
would face more serious charges or a longer prison sentence if he did not speak
with them. (Tr. at 14, 27); see also (Gov’t Ex. 1). The agents never advised Norkus
at any time during the interview that he was a target of a criminal investigation,
and they also never advised him that he was free to leave, that he did not have to
speak with them, or that his statements could be used against him, though Norkus
also never asked to speak to an attorney or invoked his right to silence.27 (Tr. at
26 The agents never blocked the door to the room during the interview, and in fact,
twice during the course of the interview individuals entered the “social room,” but
they immediately left the room on their own accord. (Tr. at 12-13, 15; Gov’t Ex. 1
at 29:11-29:18, 49:20-49:22).
27 Norkus concedes that he “never invoked his right to counsel” during the
interview. [Doc. 142 at 4 (citing (Tr. at 29))]. At the evidentiary hearing, Norkus’
counsel attempted to ask Agent Rhoden about Norkus’ legal representation in
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15, 18-20, 25, 27, 29-30); see also (Gov’t Ex. 1). The agents, however, did advise
Norkus that they were speaking to him first rather than to Sperber and that he had
the opportunity to cooperate and should do so, though they never promised him
a reduced sentence. (Tr. at 27, 29; Gov’t Ex. 1).
2. Analysis
Norkus moves to suppress statements he made during the interview on
March 10, 2021. [Doc. 97]; see also [Doc. 142]. Norkus first argues that his
statements on March 10, 2021, should be suppressed because Agents Rhoden and
Ryskoski encroached on his attorney-client relationship, in violation of Georgia
Rule of Professional Conduct 4.2. [Doc. 142 at 18-22]. Relatedly, he also argues
that he should have been able to question Agent Rhoden at the evidentiary hearing
about Norkus’ legal representation at the time of the interview and asks the Court
related civil lawsuits at the time of the March 10, 2021, interview, and the
government objected to this line of questioning based on relevance, which the
Court sustained as to the question posed. (Tr. at 21-23). Norkus’ counsel then
argued that Norkus’ “representation was definitely a part of the issues that [she]
wanted to raise about the voluntariness of his statement” and the Court advised
her that if she wanted to “try to pose something more narrow,” she was “welcome
to do so[.]” (Tr. at 22-23). Norkus’ counsel then asked Agent Rhoden whether he
was aware that Norkus had an attorney representing him in the civil lawsuits at
the time he interviewed him, and Agent Rhoden responded affirmatively,
confirmed that Norkus had referenced his attorney during the interview, and
explained that “when an attorney was even mentioned,” he and Agent Ryskoski
advised Norkus that they did not “want to hear about anything that [he] may have
spoken with [his] attorney.” (Tr. at 24-25); see also (Gov’t Ex. 1.).
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to reopen the evidentiary hearing to allow him to present evidence to address the
issue. [Id. at 16-18]. Finally, Norkus argues that his statements were not
voluntarily made because he was misled into believing the agents were
investigating Sperber and not him and that after encroaching on his attorney-client
relationship, they told him he needed to cooperate, rendering his statements
involuntary. [Id. at 22-25]. The Court will address each of these arguments.
a. Violation of the Georgia Rules of Professional Responsibility
Norkus contends that the agents encroached on his attorney-client
relationship, in violation of Georgia Rule of Professional Conduct 4.2, when they
questioned him on March 10, 2021. [Doc. 142 at 18-22]. In particular, Norkus
asserts that because Rule 4.2 provides that a “lawyer who is representing a client
in a matter shall not communicate about the subject of the representation with a
person the lawyer knows to be represented by another lawyer in the matter, unless
the lawyer has the consent of the other lawyer or is authorized to do so by law or
court order,” and the “Comment to Rule 4.2 [only] allows contact about matters
not related to the subject matter,” Norkus’ “statement should be suppressed
because the agents plainly knew that he was represented by counsel but continued
to ask him questions, including about the lawsuits on which they knew he was
represented,” and that the agents therefore “directly asked [ him] about the subject
matter of representation,” without telling him “not to repeat attorney-client
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communications between him and his lawyer until nearly half an hour into the
conversation.” [Id. at 18-19 (citation and internal marks omitted)].
In response, the government maintains that Norkus was not represented for
purposes of the criminal investigation at the time of the March 10, 2021 interview;
even if he had been represented, and Rule 4.2 applied, the agents’ contact with him
fell under the “authorized by law” exception to the rule; and, even if it had
“violated a Rule of Professional Responsibility . . ., suppression is not an
appropriate remedy.” [Doc. 143 at 8 (internal marks omitted)]. Norkus replies
that while the “government spends the bulk of its response arguing that it is
allowed to contact represented parties,” he “does not dispute this general
proposition,” but rather, he argues that the “agents encroached on his attorney-
client relationship, such that his statement should be suppressed.” [Doc. 144 at 2
(citations omitted)]. Specifically, Norkus contends that the “agents repeatedly
sought or invited information about the content of attorney-client
communications[]” and that it was “because of this—not just because the agents
contacted a represented party— that [ his] statement should be suppressed.” [Id.
at 2-3 (citation omitted)].
“[F]ederal prosecutors are subject to the Georgia Rules of Professional
Conduct and Local Rules of this Court.” United States v. Evans Concrete, LLC,
CR 420-081, 2023 WL 3019058, at *9 (S.D. Ga. Apr. 20, 2023), adopted by 2023 WL
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4704010, at *2 (S.D. Ga. July 24, 2023). “The Georgia no-contact rule, set forth in
Georgia Rule of Professional Conduct 4.2,” id., which has been incorporated by
this Court’s Local Rule 83.1, see LR 83.1(C), NDGa., provides, in relevant part:
RULE 4.2 COMMUNICATION WITH PERSON REPRESENTED BY
COUNSEL
(a) A lawyer who is representing a client in a matter shall not
communicate about the subject of the representation with a person
the lawyer knows to be represented by another lawyer in the matter,
unless the lawyer has the consent of the other lawyer or is authorized
to do so by law or court order.
(b) Attorneys for the State and Federal Government shall be subject to
this Rule in the same manner as other attorneys in this State.
Evans Concrete, LLC, 2023 WL 3019058, at *9.
Despite Norkus’ arguments to the contrary, [Doc. 142 at 18-19; Doc. 144 at
2-5], this Court “need not-and indeed, does not—determine whether the contacts
with [ Norkus] . . . violated Rule 4.2,” since “[e]ven if the contact[] did constitute
an ethical breach, the Eleventh Circuit law is clear that an ethical breach cannot be
the basis for exclusion of evidence,” United States v. Scrushy, 366 F. Supp. 2d 1134,
1141 (N.D. Ala. 2005) (citing United States v. Lowery, 166 F.3d 1119, 1125 (11th Cir.
1999)). In Lowery, the Eleventh Circuit held that “a state rule of professional
conduct cannot provide an adequate basis for a federal court to suppress evidence
that is otherwise admissible.” 166 F.3d at 1124. In reaching this conclusion, the
Eleventh Circuit explained, in pertinent part:
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Federal law, not state law, determines the admissibility of evidence in
federal court. “Although there is an important state interest in the
regulation of attorneys practicing within its borders, there is a
competing federal interest in the enforcement of federal criminal
law.” The same principle applies to civil law as well.
When it comes to the admissibility of evidence in federal court, the
federal interest in enforcement of federal law, including federal
evidentiary rules, is paramount. State rules of professional conduct,
or state rules on any subject, cannot trump the Federal Rules of
Evidence. . . . Federal Rule of Evidence 402 provides:
All relevant evidence is admissible, except as otherwise
provided by the Constitution of the United States, by Act of
Congress, by these rules, or by other rules prescribed by the
Supreme Court pursuant to statutory authority.
That is an exclusive list of the sources of authority for exclusion of
evidence in federal court. State rules of professional conduct are not
included in the list.
Local rules of federal courts are not listed in Rule 402, either. As a
result, otherwise admissible evidence cannot be excluded based upon
local rules. For that reason, the Southern District of Florida’s adoption
of the State of Florida’s professional conduct rules does not affect our
analysis or the result. . . .
Id. at 1124-25 (footnotes and citations omitted).
While Norkus acknowledges the Lowery decision, he contends that his
statements should be suppressed because the agents “encroached on his attorney-
client relationship” under the holding in United States v. Sander, 615 F.2d 215, 219
(5th Cir. 1980) (per curiam), which he asserts was “not tied to the violation of any
specific bar rule, but applies to the violation of a defendant’s attorney-client
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relationship more generally.” [Doc. 144 at 2, 5 (citations omitted)]. However,
Norkus’ reliance on Sander is misplaced.
In Sander, the attorney initially retained by the defendant to represent him
on his extortion charge was murdered shortly thereafter, and the defendant was
named as a possible suspect in the murder. 615 F.2d at 219. During the
investigation of the murder, the local police procured the defendant’s file from the
attorney’s office and “glanced through it.” Id. The defendant moved to dismiss
his indictment, alleging “his Sixth Amendment right to counsel was violated[.]”
Id. The district court conducted an in camera hearing, during which the police
officer who examined the file testified that he did not see the document defendant
had concerns about, that he did not discuss the file with any federal agents, and
that he provided no evidence to the government, nor was any information from
defendant’s file used by the government in the case. Id. Under these facts, the
Fifth Circuit found that defendant had “made no showing of injury or prejudice
because of the fact that his file at his attorney’s office was viewed by the [ local]
police” and “denied his motion to dismiss.” Id. However, the Fifth Circuit noted
that “[w]here there is an intrusion on the attorney-client relationship the remedy
for such a violation is not dismissal but the suppression of any evidence so
obtained.” Id. (citations omitted).
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In relying on Sander, Norkus would have this Court ignore the fact that the
general proposition articulated by the Fifth Circuit was in the context of a Sixth
Amendment violation, which Norkus acknowledges does not apply in this case.
See [Doc. 144 at 2].28 This case is clearly distinguishable from the circumstances in
Sander, and this Court “is bound to follow controlling precedent of this circuit.”
28 In United States v. Tapp, No. CR107-108, 2008 WL 2371422, at *17-18 (S.D. Ga.
June 4, 2008), the district court concluded that the no-contact rule “should be
interpreted by courts as a guide for professionalism among attorneys, not as a
vehicle for conferring substantive criminal rights not provided by the
Constitution,” and further explained that “the scope of the [n]o-[c]ontact [r]ule and
the scope of the Sixth Amendment [were] not identical,” since “[w]here there is a
constitutional violation, the court has the uncontroverted power to uphold the
Constitution and to suppress evidence or reverse a conviction,” but “[a]bsent the
implication of a defendant’s substantive rights, violation of Rule 4.2 [was] akin to
‘harmless error’ and should not be enough for a court to grant a substantive
remedy affecting a defendant’s case.” Norkus “cites no authority, and the Court
has found none, holding that the mere use of a covert [operation] to speak with
him during the investigative phase—even if the [g]overnment knew he was
represented—is the kind of technique that is so outrageous that it is fundamentally
unfair and shocking to the universal sense of justice mandated by the Due Process
Clause of the Fifth Amendment.” United States v. Jafari, CRIMINAL CASE NO.
1:19-CR-0078-SCJ-LTW, 2020 WL 7090698, at *11 (N.D. Ga. Feb. 25, 2020)
(emphasis, citation, and internal marks omitted), adopted by 2020 WL 6281703, at
*1 (N.D. Ga. Oct. 27, 2020). In sum, the “ethical rules do not state anywhere therein
that they create substantive rights, and courts should not read substantive rights
into the rules of legal ethics,” Tapp, 2008 WL 2371422, at *18 (citation omitted), and
“there are other remedies available to deter ethical violations by federal attorneys,
including disciplinary sanctions within the Justice Department and by the bar
associations of which they are members, [so] the need for the exclusionary rule as
a remedy for ethical violations is far outweighed by the costs the rule inflicts on
the truth-finding process,” Scrushy, 2004 WL 483264, at *6 (emphasis omitted).
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Scrushy, 366 F. Supp. 2d at 1141. In fact, the Eleventh Circuit recently reaffirmed
its holding in Lowery, and concluded that it “need not reach whether the
[g]overnment violated Georgia’s no-contact rule because [it had] held that a state
rule of professional conduct cannot provide an adequate basis for a federal court
to suppress evidence that is otherwise admissible,” and that it was “bound to
follow a prior binding precedent unless and until it [was] overruled by [the
Eleventh Circuit] en banc or by the Supreme Court.” United States v. Beck, No.
21-13582, 2023 WL 5016614, at *5 (11th Cir. Aug. 7, 2023) (citations and internal
marks omitted). In Beck, the Eleventh Circuit explained that because the
defendant had “presented no other basis for suppressing the recordings other than
an alleged violation of Rule 4.2. . . ., the district court did not err in denying the
motion to suppress [the defendant’s] statements made to an undercover informant
pre-indictment.” Id. Indeed, the holding in Lowery, 166 F.3d at 1124-25,
“forecloses [Norkus’] argument that the [g]overnment’s alleged violation of
Georgia’s Rules of Professional Conduct provides an adequate basis to suppress
evidence in this case.” Jafari, 2020 WL 6281703, at *1 n.1 (citation omitted). Thus,
pursuant to the binding precedent set forth under Lowery, “[s]uppression is not
an available remedy for a violation of the no-contact rule even assuming the
federal prosecutor knowingly violated Rule 4.2,” especially in the absence of a
violation of a substantive right, Evans Concrete, LLC, 2023 WL 3019058, at *9-10;
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see also Adams v. Austal, U.S.A., L.L.C., 569 F. App’x 732, 736 (11th Cir. 2014) (per
curiam) (unpublished) (alteration, citation, and internal marks omitted)
(explaining that in “the Eleventh Circuit, a state rule of professional conduct
cannot provide an adequate basis for a federal court to suppress evidence that is
otherwise admissible”); Bane by & through Bane v. Se. Corr. Med. Grp., Inc., CASE
NO.: 1:19-CV-179 (LAG), 2022 WL 993017, at *4 (M.D. Ga. Mar. 31, 2022) (citation
and internal marks omitted) (explaining that state rules of professional conduct
“can have no role in determining whether evidence is admissible in federal court
proceedings”), and the Court therefore “need not reach whether the [g]overnment
violated Georgia’s no-contact rule,” Beck, 2023 WL 5016614, at *5; see also United
States v. Esformes, Case No. 16-20549-Cr-Scola/Otazo-Reyes, 2018 WL 5919517, at
*17 (S.D. Fla. Nov. 13, 2018) (citation and internal marks omitted) (explaining that
“even if the state ethics rules apply to a federal prosecutor in the pre-indictment,
pre-arrest stage of an investigation, the Eleventh Circuit has held that a state rule
of professional conduct cannot provide an adequate basis for a federal court to
suppress evidence that is otherwise admissible”), since Norkus’ argument in this
respect does not provide a basis to suppress his statements made on March 10,
2021.29
29 Norkus maintains that he “should have been able ask [Agent Rhoden] about [
his legal] representation at the time of the interview, and he objects to the Court’s
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b. Voluntariness
Although Norkus does not contend that his statements were taken in
violation of Miranda, “the [C]ourt still must determine that any confessions or
decision to prohibit this line of questioning,” and he asks “the Court to re-open the
evidentiary hearing and allow him to present evidence[.]” [Doc. 142 at 16-17].
Relatedly, Norkus points to discovery he was provided following the evidentiary
hearing that shows the government obtained an order, authorizing covert, pre-
indictment contact between Sperber and a victim, since both Sperber and the
victim were represented by counsel in private, civil lawsuits, and indicated that
the government would take certain precautions to protect attorney-client
discussions on the recorded calls, in an effort to bolster his argument for
suppression of his statements by arguing that the “agents did not take any of the
cautionary measures described by the government in the motion in which it
sought approval to record conversations with Sperber” and to support his request
to reopen the evidentiary hearing. [Doc. 142 at 14-15, 22; Doc. 144 at 7-8].
However, as the government points out, the victim, Currie, “agreed to make
consensually monitored telephone calls with Sperber and Sperber’s counsel,” and
it therefore obtained the order “[o]ut of an abundance of caution,” since “Currie
could conceivably engage in discussions with Sperber and Sperber’s counsel about
their respective civil litigation strategies,” which has no bearing “on the March
2021 interview[.]” [Doc. 143 at 16-18]. Putting aside the parties arguments in this
regard, “[b]ecause suppression of [Norkus’ statements during the March 10, 2021,
interview] is not a remedy available in these circumstances, there is [simply] no
need for an evidentiary hearing,” as “[w]hatever might be found about violations
of Rule 4.2 would not lead to the suppression of the [statement], so a hearing on
the issue appears useless.” Scrushy, 2004 WL 483264, at *6. Furthermore, as noted
earlier, the Court sustained an objection by the government to a question posed by
Norkus’ counsel, but invited her to rephrase it, and she proceeded to ask the
witness several questions consistent with the topics she said she intended to cover
on the issue of representation and therefore had an adequate opportunity to
question the witness on those topics. (Tr. at 21-25). Thus, it is not necessary to
reopen the evidentiary hearing in this case.
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incriminatory statements made by [Norkus] were voluntary in order to admit
them at trial.” United States v. Lazarus, 552 F. App’x 892, 895 (11th Cir. 2014) (per
curiam) (unpublished) (citing United States v. Bernal–Benitez, 594 F.3d 1303, 1317–
18 (11th Cir. 2010)); see also United States v. Badiki, CRIMINAL ACTION NO.
1:17-CR-342-ELR-AJB, 2018 WL 7283636, at *9 (N.D. Ga. Dec. 31, 2018) (citations
omitted) (“Regardless of whether [d]efendant was in custody or not, the
[g]overnment must prove that [his] statements were voluntary.”), adopted by 2019
WL 397991, at *2 (N.D. Ga. Jan. 31, 2019). Whether a statement was voluntarily
given must be examined in light of the totality of the circumstances. United States
v. Shepherd, Criminal Case No. 1:11–cr–00058–ODE–RGV–1, 2011 WL 4443440, at
*7 (N.D. Ga. Aug. 23, 2011) (citing Schneckloth v. Bustamonte, 412 U.S. 218, 226
(1973); Hubbard v. Haley, 317 F.3d 1245, 1252 (11th Cir. 2003)), adopted by 2011
WL 4443435, at *1 (N.D. Ga. Sept. 21, 2011). “This totality of the circumstances test
directs the Court ultimately to determine whether a defendant’s statement was the
product of ‘an essentially free and unconstrained choice.’” United States v.
Villaverde-Leyva, Criminal Action File No. 1:10-CR-035-RWS/AJB, 2010 WL
5579825, at *11 (N.D. Ga. Dec. 9, 2010) (citation omitted), adopted by 2011 WL
121932, at *1 (N.D. Ga. Jan. 14, 2011). “Among the factors the Court must consider
are the defendant’s intelligence, the length of his detention, the nature of the
interrogation, the use of any physical force against him, or the use of any promises
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or inducements by police.” Villaverde-Leyva, 2010 WL 5579825, at *11 (citations
omitted); see also United States v. Moran-Can, No. CR-22-01661-001-TUC-SHR
(LCK), 2023 WL 2727824, at *5 (D. Ariz. Mar. 31, 2023) (citations omitted).
The focus of the voluntariness inquiry is whether Norkus was coerced by
the government into making the statement, so “the relinquishment of the right
must have been voluntary in the sense that it was the product of a free and
deliberate choice rather than intimidation, coercion, or deception.” Moran v.
Burbine, 475 U.S. 412, 421 (1986); see also Berghuis v. Thompkins, 560 U.S. 370, 382
(2010) (citation omitted); Collazo v. Estelle, 940 F.2d 411, 415 (9th Cir. 1991)
(citation omitted); United States v. Cordova, 829 F. Supp. 2d 1342, 1353 (N.D. Ga.
2011) (citation omitted), adopted at 1345. Thus, “[t]hose cases where courts have
found confessions to be involuntary ‘have contained a substantial element of
coercive police conduct.’” United States v. Patterson, Criminal No. 1:06-CR-500-
1-TWT, 2007 WL 2331080, at *4 (N.D. Ga. Aug. 10, 2007) (quoting Colorado v.
Connelly, 479 U.S. 157, 164 (1986)), adopted at *1; see also Connelly, 479 U.S. at 167
(“[C]oercive police activity is a necessary predicate to the finding that a confession
is not ‘voluntary[.]’”); United States v. Preston, 751 F.3d 1008, 1019 (9th Cir. 2014)
(citation omitted); Demarest v. Sec’y, Dep’t of Corr., Case No. 8:13-cv-75-T-36TBM,
2016 WL 951913, at *6 (M.D. Fla. Mar. 14, 2016) (citation omitted). “Sufficiently
coercive conduct normally involves subjecting the accused to an exhaustingly long
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interrogation, the application of physical force or the threat to do so, or the making
of a promise that induces a confession.” United States v. Jones, 32 F.3d 1512, 1517
(11th Cir. 1994) (per curiam) (citation omitted); see also Preston, 751 F.3d at 1016;
Trethewey v. Farmon, 39 F. App’x 591, 593 (9th Cir. 2002) (unpublished) (citation
omitted); Martin v. Wainwright, 770 F.2d 918, 926 (11th Cir. 1985) (alteration in
original) (citation and internal marks omitted) (noting that the test for determining
voluntariness of a confession and whether coercion was present is whether the
defendant’s “will [was] overborne and his capacity for self-determination critically
impaired”), modified in unrelated part by, 781 F.2d 185 (11th Cir. 1986) (per
curiam).
Norkus contends that the “misleading nature of the interview—that the
agents indicated that they were investigating [] Sperber, not [ him], and that they
told [ him] that he needed to ‘own[] up’ to his involvement and that they ‘need[ed]
him to cooperate with [them],’” rendered his statements involuntary because “he
felt compelled to answer their questions.” [Doc. 144 at 9 (citation omitted)]; see
also [Doc. 142 at 22-24]. The government responds that “it is difficult to imagine
a situation where two dedicated law enforcement agents conducted a more
professional interview of a suspect,” and that Norkus’ “motion points to no facts
and no legal authority suggesting that suppression is warranted.” [Doc. 143 at 8
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(emphasis omitted)]. For the reasons that follow, Norkus’ motion to suppress his
statements is due to be denied.
“A confession is involuntary if the suspect’s ‘will was overborne in such a
way as to render his confession the product of coercion.’” Demarest, 2016 WL
951913, at *6 (quoting Arizona v. Fulminante, 499 U.S. 279, 288 (1991)); see also
Doody v. Ryan, 649 F.3d 986, 1008 (9th Cir. 2011) (citation omitted); United States
v. Pinder, CRIMINAL ACTION FILE NO. 1:08-CR-421-03-MHS/AJB, 2009 WL
10670633, at *30 (N.D. Ga. Dec. 23, 2009) (citation and internal marks omitted)
(“Determining if a confession is voluntary requires examining whether a
defendant’s will was overborne by the circumstances surrounding the giving of a
confession.”), adopted by 2010 WL 11507903, at *14 (N.D. Ga. Mar. 5, 2010), aff’d,
437 F. App’x 816 (11th Cir. 2011) (per curiam) (unpublished). As previously noted,
the Court must consider the totality of the circumstances to determine whether
Norkus’ statements were voluntary. Pinder, 2009 WL 10670633, at *30 (citations
omitted); see also Preston, 751 F.3d at 1016 (citations omitted); Bernal-Benitez, 594
F.3d at 1319 (citation omitted) (“[The Court] consider[s] the totality of the
circumstances, including the details of the interrogation and the defendant’s
characteristics, when deciding whether a confession was voluntary.”).
“Considering the totality of the circumstances as established by the evidence
adduced at the evidentiary hearing, the Court finds that the government has
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demonstrated by a preponderance of the evidence that [Norkus’] statements were
entirely voluntary.” United States v. Lynn, 547 F. Supp. 2d 1307, 1311 (S.D. Ga.
2008) (citations omitted), adopted at 1308. The interview with the FBI agents on
March 10, 2021, which was conducted in a “social room” located on the first floor
of Norkus’ condominium building and lasted no more than an hour and twenty
minutes, was not unreasonably long, see Shriner v. Wainwright, 715 F.2d 1452,
1455 (11th Cir. 1983) (concluding that statements made during a five-hour
interrogation were not involuntary). Additionally, the agents generally
maintained a calm and cordial tone during the interview, did not brandish their
weapons, and did not use any physical force against Norkus or threaten him in
any way, nor did they make any promises to him, see (Tr. at 8, 14-17, 21, 25, 27, 29-
30; Gov. Ex. 1); see also Moran, 475 U.S. at 421 (citation omitted) (“[T]he record is
devoid of any suggestion that police resorted to physical or psychological pressure
to elicit the statements.”); Miller v. Dugger, 838 F.2d 1530, 1537 (11th Cir. 1988)
(finding that “there was no official overreaching that could have rendered
[defendant’s] statement involuntary” under the totality of the circumstances,
including that “[t]he transcript [did] not suggest, nor d[id] [defendant] allege, that
the police either applied physical force or threatened to do so”).
Although Norkus asserts that he was misled or deceived because the agents
encouraged him to talk by implying that cooperation and being truthful were in
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his best interest, after indicating that they were investigating only Sperber in an
apparent attempt to downplay the significance of his statements, which led him to
believe that he had to respond to their questions, [Doc. 142 at 24; Doc. 144 at 9], the
evidence of record belies Norkus’ assertions, see generally (Gov. Ex. 1). First, any
suggestion that cooperation was in Norkus’ best interest and that he should tell
the truth does not constitute sufficient police overreaching or coercion to render a
statement involuntary. United States v. Hipp, 644 F. App’x 943, 945, 947-48 (11th
Cir. 2016) (per curiam) (unpublished) (alteration, citations, and internal marks
omitted) (finding statements to defendant that they were FBI agents investigating
fraudulent activities of a corporation and that defendant should tell the truth and
that cooperating with the government may be beneficial or in his best interest did
not render a statement involuntary but amounted to “no more than affording [the
defendant] the chance to make an informed decision with respect to his
cooperation with the government,” even though the agents knew at the time of
questioning, which lasted an hour and a half, defendant could face criminal
charges for his involvement with the corporation); see also United States v.
Rutledge, 900 F.2d 1127, 1128, 1130-31 (7th Cir. 1990) (holding a defendant’s
statement to be voluntary even though police told him that “all cooperation is
helpful”); United States v. Chaidez-Reyes, 996 F. Supp. 2d 1321, 1352 (N.D. Ga.
2014) (finding that the agents advising defendant that they did not believe his
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denials of criminal activity “did not render his statements involuntary”). Indeed,
“[a] mere admonition to the accused to tell the truth does not render a statement
involuntary,” and similarly, “a general statement that cooperation may be
beneficial to an accused, with no promise of leniency, does not amount to an illegal
inducement.” Hipp, 644 F. App’x at 947 (citations omitted); see also United States
v. Varnell, Criminal Indictment No. 1:13–CR–394., 2014 WL 5517923, at *10 (N.D.
Ga. Oct. 28, 2014) (explaining that “[w]hile the agents did make vague statements
indicating that cooperation could help [d]efendant, the agents’ conduct in raising
the possibility of [d]efendant cooperating [did] not render [d]efendant’s
subsequent statements involuntary”).
To the extent the agents’ attempts to downplay the significance of Norkus’
statements amounted to trickery or deception, “it is clear, that the police’s use of a
trick alone will not render a confession involuntary.” United States v. Castandeda-
Castaneda, 729 F.2d 1360, 1363 (11th Cir. 1984) (citations omitted). Indeed,
“trickery or deceit is only prohibited to the extent it deprives the suspect of
knowledge essential to his ability to understand the nature of his rights and the
consequences of abandoning them.” Soffar v. Cockrell, 300 F.3d 588, 596 (5th Cir.
2002) (citation and internal marks omitted); see also United States v. Lall, 607 F.3d
1277, 1285-86 (11th Cir. 2010) (citations omitted) (noting that police
misrepresentations of fact are not enough to render a confession involuntary, but
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misrepresentations of law are more likely to do so). Accordingly, “[t]he kinds of
deception that are generally deemed to trigger suppression are lies about a
defendant’s legal rights (i.e., you must answer our questions), false promises (i.e.,
whatever you say will be just between us) or threats (i.e., if you don’t talk, you
won’t see your family for a very long time).” United States v. La Forgia, Criminal
No. 12-0057-WS-C, 2012 WL 1869035, at *4 (S.D. Ala. May 22, 2012) (footnote and
internal marks omitted) (citing United States v. Degaule, 797 F. Supp. 2d 1332, 1380
(N.D. Ga. 2011)).
Moreover, cases where police trickery has caused a statement to be
involuntary involve “other aggravating circumstances.” Castaneda-Castaneda,
729 F.2d at 1363; see also United States v. Graham, Criminal Action File No. 3:13–
cr–11–TCB, 2014 WL 2922388, at *10 (N.D. Ga. June 27, 2014). Since “[c]oercive
police activity is a necessary predicate to the finding that a [statement] is not
‘voluntary,’” see Connelly, 479 U.S. at 167, the aggravating circumstances
generally must show that the police exerted such pressure on a defendant that his
“will [is] overborne and his capacity for self-determination critically impaired,”
Martin, 770 F.2d at 926 (citation and internal marks omitted); see also United States
v. Anthony, Criminal Case No. 1:11-CR-0326-SCJ-JFK, 2012 WL 684844, at *6 (N.D.
Ga. Jan. 20, 2012) (finding statement voluntary despite the fact that the agents were
not truthful with defendant about the reason for the interview where the
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atmosphere was cordial, the agents did not use any force or draw their weapons,
the agents did not make defendant any promises or threaten him, and defendant
never asked for a lawyer or told the agents he did not want to speak to them),
adopted by 2012 WL 684802, at *1 (N.D. Ga. Mar. 2, 2012).
Norkus asserts that the agents misled him “into believing that he was
participating in an investigation into [] Sperber,” [Doc. 144 at 10 n.3], but to the
extent this contention is accurate, it was a simple misrepresentation of fact that,
without more, does not render Norkus’ statements involuntary, see Lall, 607 F.3d
at 1285-86 (citations omitted); see also United States v. Farley, 607 F.3d 1294, 1328
(11th Cir. 2010) (citation and internal marks omitted) (finding “[k]nowledge of
what the agents really suspected [defendant] of doing would no doubt have been
useful, possibly even decisive, to [him] in calculating the wisdom of answering
their questions,” but “their deception on that point was not constitutionally
significant”); United States v. Kidd, CRIMINAL CASE NO. 1:16-CR-00172-AT-
JFK, 2016 WL 10704429, at *8 (N.D. Ga. Dec. 7, 2016) (footnote and citation omitted)
(explaining that “agents were not required to provide [d]efendant with details
about the nature of their investigation inquiry or that he was the focus of that
inquiry”), adopted by 2017 WL 6520539, at *1 (N.D. Ga. Dec. 19, 2017).
Furthermore, no other aggravating circumstances are present that render the
environment in which Norkus spoke with the agents coercive, see Hipp, 644 F.
85
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App’x at 947; Anthony, 2012 WL 684844, at *6.30 As previously set forth, the agents
never drew their weapons or threatened Norkus; Norkus was not handcuffed or
restrained in any way at any point during the interview, which took only about an
30 Norkus also “maintains that his statement was involuntary because—despite [
his] repeated statements that he had an attorney, including that he had a meeting
with his attorney that afternoon, and statements about what he and his attorney
had discussed—the agents never informed [ him] that he was not required to talk
to them or that he could invoke his right to counsel.” [Doc. 144 at 10 (citation
omitted)]. While “a suspect subject to custodial interrogation has the right to
consult with an attorney and to have counsel present during questioning,” Davis
v. United States, 512 U.S. 452, 457-58 (1994), and “if a suspect requests counsel at
any time during [an] interview, he is not subject to further questioning until a
lawyer has been made available or the suspect himself reinitiates conversation,”
id. at 458 (citation omitted) (citing Edwards v. Arizona, 451 U.S. 477, 484-85 (1981)),
“Miranda rights cannot be asserted outside the context of custodial interrogation,”
and, an “individual cannot, therefore, assert his . . . Miranda right to counsel before
he . . . is in custody,” United States v. Clark, 600 F. Supp. 3d 251, 272 (W.D.N.Y.
2022) (citation and internal marks omitted); see also United States v. Sater, 477 F.
Supp. 3d 372, 383 (M.D. Pa. 2020) (citation omitted) (explaining that the ”right to
remain silent and the right to counsel pursuant to Miranda can only be involved
during a custodial interrogation[]”); Kidd, 2016 WL 10704429, at *8 (rejecting
defendant’s argument “that his statement [was] involuntary because he was not
advised of his right to remain silent” as “a non-starter,” since “the interview was
non-custodial”), and Norkus acknowledges that he was not in custody at the time
of the interview, see [Doc. 144 at 1]. Moreover, Norkus concedes that he “never
invoked his right to counsel,” [Doc. 142 at 4 (citing (Tr. at 29))], and despite his
assertion that he was pressured to cooperate without the assistance of counsel,
[Doc. 144 at 10], the credible evidence of record simply does not support this
assertion, and in fact, demonstrates that no promises or threats were made in
exchange for his statements and that the agents repeatedly advised him during the
course of the interview that they did not want to hear about any conversations
held with counsel, see (Gov. Ex. 1).
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hour and twenty minutes and occurred in an open “social room” on the first floor
of Norkus’ condominium building; and, while Norkus was advised that the agents
were speaking to him first and that it was in his best interest to cooperate and be
truthful with them, he was never threatened or promised anything in return for
his statement. (Tr. at 8, 14-17, 21, 25, 27, 29-30; Gov. Ex. 1). In short, Norkus has
not identified, nor does the record reveal, any aggravating circumstances creating
a coercive environment which would cause the agents’ use of any trickery to
render Norkus’ statement involuntary. See Kidd, 2016 WL 10704429, at *8-9
(citations and internal marks omitted) (finding “[n]othing about the circumstances
of the interview . . . evidence[d] any attempt by the agents to coerce [d]efendant to
speak to them, and . . . no aggravating facts suggest[ed] that [d]efendant answered
questions unwillingly” where “the interview occurred in a location selected by
[d]efendant” and once the interview started, defendant “was not restrained,
threatened physically or verbally or misled,” but that even if he “was misled about
the nature of the interview, there were no other aggravating circumstances beyond
the mere use of deceptive tactics that render[ed his] confession involuntary”); see
also Anthony, 2012 WL 684844, at *6. In sum, “the totality of the circumstances
demonstrates that [Norkus] made his statements voluntarily.” United States v.
Nettleton, Case No. 3:19-cr-1-J-32PDB, 2019 WL 5102803, at *6 (M.D. Fla. Oct. 11,
2019); see also United States v. Grant, Criminal Action No. 1:09–CR–482–TWT–
87
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LTW, 2011 WL 2580867, at *7 (N.D. Ga. May 4, 2011), adopted by 2011 WL 2580779
(N.D. Ga. June 29, 2011), aff’d, 521 F. App’x 841 (11th Cir. 2013) (unpublished).
Accordingly, Norkus’ arguments regarding the voluntariness of his statements on
March 10, 2021, are without merit, and because he has not identified any legitimate
basis for suppression, it is RECOMMENDED that his motion to suppress
statements, [Doc. 97], be DENIED.
III. CONCLUSION
For the foregoing reasons, Sperber’s motion to adopt, [Doc. 106], is
GRANTED, Norkus’ motion for bill of particulars, [Doc. 98], is DENIED and his
motion to adopt, [Doc. 96], is DENIED AS MOOT, and it is RECOMMENDED
that Sperber’s motion to maintain filing ex parte and under seal, [Doc. 52], be
GRANTED and that defendants’ motions to dismiss, [Docs. 103, 105, & 115], and
Norkus’ motion to suppress statements, [Doc. 97], be DENIED.
There are no other pending matters before the Magistrate Judge, and the
undersigned is aware of no problems relating to the scheduling of this case, but
notes that Sperber recently retained new counsel.
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IT IS THEREFORE ORDERED and ADJUDGED that this action be and
the same is hereby, certified Ready for Trial.
IT IS SO ORDERED and RECOMMENDED, this 23rd day of August,
2023.
89