7040 1 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK 2 - - - - - - - - - - - - - - X 3 UNITED STATES OF AMERICA, : CR 96 1016(S-1) 4 v. : U.S. Courthouse 5 Uniondale, New York BRUCE W. GORDON, WHO'S WHO 6 WORLD WIDE REGISTRY, INC., : STERLING WHO'S WHO, INC., 7 TARA GARBOSKI, ORAL FRANK OSMAN, LAURA WEITZ, ANNETTE 8 HALEY, SCOTT MICHAELSON, : STEVE RUBIN, and MARTIN 9 REFFSIN, : TRANSCRIPT OF TRIAL 10 Defendants. :March 9, 1998 11 - - - - - - - - - - - - - - X 9:45 o'clock a.m.
12 BEFORE:
13 HONORABLE ARTHUR D. SPATT, U.S.D.J. and a jury 14 APPEARANCES: 15 For the Government: ZACHARY W. CARTER 16 United States Attorney One Pierrepont Plaza 17 Brooklyn, New York 11201 By: RONALD G. WHITE, ESQ. 18 CECIL SCOTT, ESQ. Assistant U.S. Attorneys 19 For the Defendants: NORMAN T
RABULUS, ESQ. 20 For Bruce W. Gordon 170 Old Country Road, Suite 600 21 Mineola, New York 11501
22 EDWARD P. JENKS, ESQ. For Who's Who Worldwide 23 Registry, Inc. and Sterling Who's, Who, Inc. 24 332 Willis Avenue Mineola, New York 11501 25 (cont'd)
7041
1 APPEARANCES (cont'd):
2 GARY SCHOER, ESQ. For Tara Garboski 3 6800 Jericho Turnpike Syosset, New York 11791 4 ALAN M. NELSON, ESQ. 5 For Oral Frank Osman 3000 Marcus Avenue 6 Lake Success, New York 11042
7 WINSTON LEE, ESQ. For Laura Weitz 8 319 Broadway New York, New York 10007 9 MARTIN GEDULDIG, ESQ. 10 For Annette Haley 400 South Oyster Bay Road 11 Hicksville, New York 11801
12 JAMES C. NEVILLE, ESQ. For Scott Michaelson 13 225 Broadway New York, New York 10007 14 THOMAS F.X. DUNN, ESQ. 15 For Steve Rubin 150 Nassau Street 16 New York, New York 10038
17 JOHN S. WALLENSTEIN, ESQ. For Martin Reffsin 18 215 Hilton Avenue Hempstead, New York 11551 19
20 Court Reporters: HARRY RAPAPORT OWEN M. WICKER 21 United States District Court Two Uniondale Avenue 22 Uniondale, New York 11553 (516) 485-6558 23 24 Proceedings recorded by mechanical stenography, transcript produced by Computer-Assisted Transcription 25
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7042
1 M O R N I N G S E S S I O N
2
3 (Whereupon, the following takes place in the
4 absence of the jury.)
5 THE COURT: Good morning.
6 MR. SCHOER: Good morning. Mr. Lee just came in
7 from the rain.
8 THE COURT: Is it raining outside?
9 Why were we supposed to be here early? Anybody
10 know?
11 MR. TRABULUS: I recall on Thursday Mr. White
12 indicated there might be some matters
he wanted to take
13 up. But ultimately I think your Honor said we should be
14 here at 9:30.
15 THE COURT: All right.
16 MR. NEVILLE: I placed before the Court my
17 proposed instruction to the jury about Scott Michaelson
18 not being here today.
19 THE COURT: You wanted me to say something about
20 it?
21 MR. NEVILLE: Yes. My client will not be here
22 today.
23 THE COURT: All right. 24 MS. SCOTT: We have a couple of matters to raise, 25 your Honor.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7043
1 First, going back to Thursday when your Honor
2 admitted that large grouping of exhibits --
3 THE COURT: I can't hear you.
4 MS. SCOTT: Okay.
5 Going back to Thursday morning when your Honor
6 admitted the large group of exhibits, the one that is too
7 lengthy to read into the record right
now. What I did is
8 wrote a summary list of those exhibits and marked it
9 Government's Exhibit 1613. On that exhibit I crossed off
10 the exhibits that were excluded by your Honor.
11 THE COURT: Okay.
12 MS. SCOTT: I was going to give that to
13 Mr. Rapaport so he can include it into the trial record.
14 THE COURT: You are offering
15 Government's Exhibit 1613, which is a list of the
16 exhibits?
17 MS. SCOTT: That's right.
18 THE COURT: Introduced?
19 MR. WHITE: Yes, which are all the exhibits your
20 Honor admitted on Thursday.
21 THE COURT: Government's Exhibit 1613 in
22 evidence.
23 (Government's Exhibit 1613 received in evidence.) 24 MS. SCOTT: I am handing it to Mr. Rapaport. 25 THE COURT: Fine.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7044
1 MS. SCOTT: I did research on the issue of
2 commercial paper. There is another issue I want to raise
3 about playing some tapes which brings up a whole host of
4 other issues, and I wonder if you wish to have us argue it
5 later when the jury is not waiting.
6 THE COURT: What is this now?
7 MS. SCOTT: I am hoping to admit a group of
8 exhibits as commercial paper, checks your Honor excluded
9 from the list of exhibits which I handed to Mr. Rapaport.
10 THE COURT: Checks from third parties?
11 MS. SCOTT: Yes.
12 THE COURT: You have law on that?
13 MS. SCOTT: Yes. Commercial paper is self
14 authenticating under the Federal Rules of Evidence 902(9).
15 In addition to that I have a case here, your
16 Honor --
17 THE COURT: Just one minute now.
18 MS. SCOTT: Yes.
19 (Whereupon, at this time there was a pause in the
20 proceedings.)
21 THE COURT: Okay.
22 MR. WHITE: In
addition to that I have a case
23 called United States against Dawson, 400 F.2d 194, in 24 which it was held by the Second Circuit that cancelled 25 checks were admissible to prove that certain payments had
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7045
1 been made.
2 Now, overlooking all of that, the reason we
3 offered the checks in the first place, the basis for
4 offering them in the first place were as business records,
5 because they were copies which were kept by the company in
6 addition to all the other documents they had to
7 commemorate each sale. So they attached the copies of the
8 checks to the invoice, the leads card and the credit card
9 slip. Like the credit card slip these copies of the
10 checks show that the payment was made. The argument we
11 make is to show that the payment was made in exactly the
12 same w
ay that the credit card slips did, and we offered
13 them as business records.
14 However, what I am offering to your Honor in
15 addition to that is this independent basis for admitting
16 the copies as commercial paper, which is
17 self-authenticating and independently admissible.
18 THE COURT: Were these checks attached to the
19 records of Who's Who Worldwide?
20 MS. SCOTT: They were. They were attached to
21 each sale. I had to go over the numbers to show you.
22 There are about three of them.
23 THE COURT: You have given me how many reasons to 24 admit it? 25 MS. SCOTT: Business records --
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7046
1 THE COURT: How many reasons do I have to knock
2 out now, business records and self-authenticating?
3 MS. SCOTT: Self-authenticating is part of the
4 analysis to admit it
as independent commercial paper.
5 Self-authenticating takes part --
6 THE COURT: I thought that you said it was a
7 separate and independent reason?
8 MS. SCOTT: If I said that I am mistaken.
9 THE COURT: I didn't say you said it. I thought
10 you said it.
11 Those are the reasons?
12 MS. SCOTT: Yes.
13 THE COURT: Anybody objecting?
14 MR. SCHOER: Yes.
15 THE COURT: Didn't you hear the very convincing
16 argument by Ms. Scott?
17 MR. SCHOER: I heard the argument by Ms. Scott.
18 My position is, Judge, that -- that these
19 documents shouldn't be admitted primarily for relevance
20 purposes, because while they may prove that a payment was
21 made, that is not the issue in this case.
22 The issue in this case is proving that those
23 checks were in the mails somehow, because that's what the 24 charge is. And they can't prove that the
checks were sent 25 in the mail without someone here to say that they were
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7047
1 sent.
2 THE COURT: That's one argument. But of course,
3 aren't they relevant insofar as they get down to the
4 basics of what mail fraud is, a scheme or device or, or
5 artifice to obtain money by false representations; isn't
6 that what mail fraud is about? Isn't this the money that
7 the government says was obtained? You say that is not
8 relevant?
9 MR. SCHOER: They can't prove that with respect
10 to those customers there were any misrepresentations.
11 THE COURT: That's another matter. But they have
12 the burden of proof. And they have the burden of proof
13 that there was, as a result of fraudulent representations,
14 money or property -- that's what the statute says, doesn't
15 it?
16 MR. SCHOER: Yes.
17 THE COURT: Money or property was obtained. This
18 is the money they say was obtained. It is a basic
19 elemental reason to be relevant.
20 I don't see that at all.
21 Insofar as whether it was mailed is another
22 matter. It is certainly relevant, Mr. Schoer. Your
23 objection on the ground of relevancy is overruled. 24 MR. SCHOER: At least with respect to one of 25 them, your Honor, I have not looked again, one of them
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7048
1 only has the front of the check and it doesn't show that
2 it was in fact negotiated. I am not sure about that.
3 That's from my perusal of the exhibits last week.
4 THE COURT: What do you say about that one check,
5 that only the front of the check is there?
6 MS. SCOTT: Your Honor, I would submit this
7 document was part of the c
ollection of documents held in
8 the records of Who's Who Worldwide. And it was part of
9 one of the documents they used to commemorate the sale.
10 Instead of having a credit card slip, they had a copy of
11 the check. They had to send the original check back to
12 the bank.
13 THE COURT: Good old Saks/Jakobetz. What a good
14 case that is. When I read that I recoiled, Mr. Schoer.
15 That's what the rule says, make it, right?
16 MR. SCHOER: Yes.
17 THE COURT: Here you have a third-party making
18 it, yet it is part of the business record. Judge Pratt,
19 he was something, I tell you. WHAT a loss to the federal
20 judiciary he was, although he wrote the Jakobetz case.
21 What else did you want to tell me, Mr. Schoer?
22 MR. SCHOER: Nothing?
23 THE COURT: Mr. Nelson? 24 MR. NELSON: Nothing. 25 THE COURT: I think you are right. The
H
ARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7049
1 objections are overruled. I think that the authenticity
2 is established if it need be, by 902(9). It is a record
3 attached on a regular basis, like the toll receipts on the
4 Triboro Bridge, a regular basis. It becomes parts of the
5 record of Who's Who Worldwide.
6 What exhibits are they?
7 MS. SCOTT: I will have to pull them together and
8 set forth the numbers clearly this afternoon.
9 THE COURT: I have no doubt that you will do
10 that, Ms. Scott.
11 What else? We have a jury that were here
12 amazingly close to the time, although one juror is from
13 Staten Island. Can you imagine that?
14 MS. SCOTT: We can make the argument later in the
15 day not to keep the jury waiting.
16 THE COURT: Good.
17 Let me look at the cautionary instruction that
18 Mr. Neville gave me.
19 That's very good, Mr. Neville. I accept it in
20 its entirety. I couldn't put a finger on it.
21 MR. NEVILLE: Thank you.
22 THE COURT: We have two requests by the jurors.
23 One juror requested for a meeting she cannot 24 miss. She wanted to leave at 4:00 o'clock on Wednesday, 25 and I will grant that.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7050
1 Another juror has some kind of medical
2 appointment at 5:00 o'clock, and wants to leave at 4:30 on
3 Thursday.
4 So, on Wednesday we are breaking at 4:00
5 o'clock. On Thursday at 4:30.
6 Let's bring in the jury.
7 (An unrelated matter is taken up by the Court.)
8 MR. WHITE: We don't need to argue. I wanted you
9 to know I left a letter brief on the bench earlier with
10 regard to the government introducing a plea allocution of
11 another individual.
12 THE COURT: Michael Maxes, M A X E S?
13 MR. WHITE: Yes. And I gave copies to defense
14 counsel.
15 THE COURT: Very well.
16 (Whereupon, the jury at this time entered the
17 courtroom.)
18 THE COURT: Good morning, members of the jury.
19 Please be seated.
20 I don't know how you did it under these
21 conditions, but you got here in amazingly early time. You
22 almost beat me here.
23 Not really. 24 But I appreciate the effort that I know you put 25 in to it to get here on time.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7051
1 A few announcements.
2 Number one, because of a request by a juror we
3 will leave at 4:00 o'clock on March 11th, this Wednesday,
4 not a week from this Wednesday.
5 On Thursday, March 12th, we will leave at 4:30.
6 And this is to accommodate the request of the ju
rors.
7 I wanted to advise you also that the defendant
8 Scott Michaelson will not be present today during the
9 trial proceedings. With the permission of the Court
10 Mr. Scott Michaelson is attending to an important personal
11 matter.
12 Mr. Michaelson's attorney, James Neville,
13 Esquire, is present to fully protect Mr. Michaelson's
14 rights and interests. You are to draw no inference
15 whatsoever from the fact that Mr. Michaelson is not here
16 for today's session. Mr. Michaelson will be back
17 tomorrow.
18 You may proceed.
19 MS. SCOTT: Thank you, your Honor.
20 The government calls John Tardera.
21 THE CLERK: Please raise your right hand.
22
23 24 25
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7052
1 J O H N E. T A R D E R A ,
2 called as a witness, having been first
3 duly sworn, was examined and testified
4 as follows:
5
6 THE CLERK: Please state your name and spell your
7 last name slowly for the record.
8 THE WITNESS: John E. Tardera, T A R D E R A.
9
10 DIRECT EXAMINATION
11 BY MS. SCOTT:
12 Q Good morning, Mr. Tardera.
13 A Good morning.
14 Q Can you tell us how you are employed?
15 A I am an attorney.
16 Q Where do you work?
17 A I work for the law firm of Whitman Breed Abbott and
18 Morgan in New York City.
19 Q What did you do for Whitman Breed Abbott and Morgan?
20 A A partner in the litigation department. I handle all
21 types of commercial litigation for the firm.
22 Q What are your responsibilities as a litigation
23 partner? 24 A We represent mostly large and small corporations. If 25 one of our clients is served with a lawsuit my initial
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7053 Tardera-direct/Scott
1 responsibility would be to review the pleading,
2 investigate the charges, see if we have any grounds to
3 dismiss the lawsuit, and either make a motion asking the
4 Court to throw it out or prepare an Answer.
5 If we have a client who wants to bring a lawsuit,
6 I would investigate the potential claims, the factual
7 bases, prepare a complaint spelling out the complaints we
8 have against the potential defendant and serve it.
9 Thereafter, I would be involved with the
10 discovery process, the exchange of documentary
11 information, deposition back and forth. I would take
12 depositions or supervise other members of my firm in
13 taking depositions.
14 Thereafter, we would prepare for trial and
15 conduct trials. In a nutshell that's what I do.
16 Q How long have you
been doing this?
17 A Since September 1983, so that's 14 and a half years.
18 Q Now, have you ever handled cases in which one company
19 sues another for trademark infringement?
20 A Yes, I have.
21 Q And how many such cases have you worked on?
22 A Three or four.
23 Q Now, are you familiar with a company called Reed 24 Elsevir? 25 A Yes, Reed Elsevir is a client of my firm.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7054 Tardera-direct/Scott
1 Q And what is the nature of Reed Elsevir's business?
2 A They publish biographical directories, the publisher
3 of biographical directories in the United States. Among
4 the publications is Who's Who in America, for example.
5 Q Does Reed Elsevir own any trademarks?
6 A Yes, they do.
7 Q What is a trademark, just for clarification?
8 A Well, the best way I can put it is tha
t it is a brand
9 name. The best example I can give is Coke is a
10 trademark. It identifies or is supposed to identify to
11 the consumer that every can of Coke comes from the same
12 source, even if the consumer doesn't know exactly where
13 that source is, the consumer should have the confidence
14 that a can of Coke is basically going to be the same high
15 quality product wherever they purchase it. That is what a
16 trademark is.
17 Q Now, what are the rights associated with a trademark?
18 A Well, if you own a trademark, if a company owns a
19 trademark, nobody else can use it.
20 For example, with Coke, no other company can
21 market a product with the name "Coke." It is exclusively
22 your name, your trademark, for your use alone.
23 Q Now, how does a company obtain the right to use a 24 particular trademark exclusively? 25 A Well, the primary way is
to use it over a long period
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7055 Tardera-direct/Scott
1 of time. That is really the basis of trademark rights,
2 use over a long period of time. And then there is also
3 the function or the possibility of registering it with the
4 United States Government.
5 Q And once a company has the right to use a particular
6 trademark, how does it enforce its right to be the
7 exclusive user of the trademark?
8 A Well, if the company has a trademark and it becomes
9 aware that another person or another company is using the
10 trademark, using that trademark, or a substantially
11 similar name, for example if someone is using Coke or
12 something substantially similar, you would initially send
13 what is called a cease and desist letter to the person who
14 is using your mark, or the company using your mark,
asking
15 them to stop using your trademark or the substantially
16 similar trademark.
17 If that doesn't work, then the next remedy is to
18 file a lawsuit.
19 Q Now, what trademarks did Reed Elsevir at the time you
20 were working with them --
21 A They owned many. The three that were prominent in my
22 work for Reed Elsevir Who's Who were in America, Who's Who
23 in the World, Who's Who in finance and the Industry, and 24 they owned others. 25 Q Are you familiar with a company called Who's Who
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7056 Tardera-direct/Scott
1 Worldwide Registry?
2 A Yes.
3 Q And how are you familiar with that company?
4 A I was involved in a lawsuit by Reed Elsevir against
5 Who's Who Worldwide Registry.
6 Q Reed Elsevir sued Who's Who Worldwide Registry?
7 A Yes.
8 Q And
when did Reed Elsevir sue Who's Who Worldwide?
9 A Sometime in 1992.
10 Q In which court did they bring a lawsuit?
11 A I believe it was this Court, on Long Island, in the
12 Eastern District of New York. I think the case initially
13 was actually in this courtroom.
14 Q Now, how did it begin -- how did Reed begin the
15 lawsuit against Who's Who Worldwide?
16 A Going back to what I said before, their lawyers
17 prepared a complaint, which is in writing, a document
18 which spells out the complaints that Reed Elsevir had
19 against Who's Who Worldwide, and requested certain relief.
20 Q What claims did Reed Elsevir assert against Who's Who
21 Worldwide in the complaint?
22 A Well, it was a complaint and an amended complaint.
23 The initial complaint had claims for trademark 24 infringement. The claims were that Who's Who Worldwide 25 Registry was using names
and selling publications using
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7057 Tardera-direct/Scott
1 titles that were substantially similar to certain of Reed
2 Elsevir's trademarks, including Who's Who in America and
3 Who's Who in the World. And then there was a subsequent
4 amended complaint that at that point added another claim
5 for false advertising. And that claim included
6 allegations that Who's Who Worldwide Registry was using
7 certain representations that weren't true that were
8 designed, we believe to cause the consumer to think that
9 their publications were connected to Reed and its books.
10 Q Now, what kind of relief did Reed Elsevir seek from
11 Who's Who Worldwide?
12 A Two kinds of relief.
13 The first was an injunction stopping Who's Who
14 Worldwide Registry from using what Reed to -- considered
15 to be th
e infringing names and titles, and to prevent
16 certain representations that we thought were improper.
17 The second type of relief was for money damages.
18 Q Did the case go to trial?
19 A Yes.
20 Q And was it tried before a jury or before a judge?
21 A Actually before a magistrate Judge, a non-jury trial.
22 Q And when was that trial?
23 A In February of 1994. 24 Q What was the result of the trial? 25 A Reed won and a judgment was entered preventing Who's
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7058 Tardera-direct/Scott
1 Who Worldwide Registry from using certain of the names and
2 titles that Reed felt were infringing on Reed's
3 trademarks. And there was also a money damages judgment
4 entered against Who's Who Worldwide and for Reed in the
5 amount of 1.6 million dollars.
6 Q Did Who's Who Worldwide appeal this j
udgment?
7 A Yes, it did.
8 Q And what role, if any, did you have in this whole
9 controversy?
10 A Well, that's when I became involved, at the appellate
11 level. My firm needed some assistance at that point, and
12 I became involved in helping put together the record on
13 appeal, which is the -- what both parties considered to be
14 the most relevant exhibits and trial testimony to bring up
15 and to show to the appellate court.
16 I also was involved in reading Who's Who
17 Worldwide's appellate brief, which was a document that
18 they gave to the Court of Appeals, asking the Court of
19 Appeals to overturn the judgment against them. And I was
20 involved in preparing a response, a written brief.
21 Q What was the position of the responsive brief?
22 A The position of the responsive brief is that the
23 Magistrate Judge who entered the judgment for Reed w
as 24 correct in all respects, and that the judgment should 25 stand, and we should collect our money damages.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7059 Tardera-direct/Scott
1 Q Now, in working on this appeal did you become
2 familiar with the record of the trial?
3 A Yes. We initially took the record of the trial and
4 condensed it down to an appellate record, and through that
5 process I became familiar with the trial record. And I
6 certainly became familiar with the record on appeal that
7 had certain aspects of the trial record in it.
8 Q Now, just going back to the trial itself, was there
9 testimony in the course of the trial concerning
10 conferences and seminars?
11 A Yes.
12 Q And can you tell us who testified about conferences
13 and seminars at the trial?
14 A Bruce Gordon.
15 Q What in substance
did Bruce Gordon say in his
16 testimony about these conferences or seminars?
17 MR. TRABULUS: Objection, your Honor.
18 I think the trial record itself, or relevant
19 portions of it have been introduced in evidence and they
20 speak for itself.
21 THE COURT: They have been introduced you say?
22 MR. TRABULUS: I believe so, that portion of it.
23 THE COURT: Sustained. 24 Q I will show you Government's Exhibit 804, which is in 25 evidence.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7060 Tardera-direct/Scott
1 (Handed to the witness.)
2 Q I would ask you to look at the testimony given on
3 February 17th, 1994, page 70.
4 A Yes.
5 Q Is this part of the testimony given by Bruce Gordon?
6 A Yes.
7 Q And can you tell us who was questioning him in this
8 part of the testimony?
9 A I can't from this pa
ge, but I do recall from the
10 record on appeal, that the questioning attorney for this
11 phase of the testimony was Mr. Tom Bailey, Reed Elsevir's
12 attorney.
13 Q Was he questioning Bruce Gordon on behalf of Reed
14 Elsevir?
15 A Yes, he was.
16 Q And just going to page 70 of that exhibit --
17 MS. SCOTT: I would ask to be able to publish the
18 exhibit to the jury.
19 THE COURT: You say it is in evidence?
20 MS. SCOTT: Yes.
21 THE COURT: Yes.
22 (Whereupon, the exhibit/exhibits were published
23 to the jury.) 24 Q I will go through the testimony starting on page 70 25 and ending at 71, the question of Bruce Gordon.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7061 Tardera-direct/Scott
1 Before we do that, I would like to also show you
2 Government's Exhibit 1614.
3 (Handed to the witness.)
4 Q Can you tell us what that is? For Identification.
5 Can you tell us what that is?
6 A It's Trial Exhibit 176.
7 Q Is that an exhibit used at this trial between Reed
8 Elsevir and Who's Who Worldwide Registry?
9 A Yes.
10 MS. SCOTT: I offer Government Exhibit 1614.
11 MR. TRABULUS: No objection.
12 THE COURT: Government's Exhibit 1614 in
13 evidence.
14 (Government's Exhibit 1614 received in evidence.)
15 Q Government's Exhibit 1614 is a brochure issued by
16 Who's Who Worldwide; is that correct?
17 A Yes.
18 Q Is that the exhibit that is then the subject of the
19 testimony that I put before you as
20 Government's Exhibit 804?
21 A Yes, it is.
22 Q The subject of the testimony discussed on page 70 and
23 page 174 of the transcript; is that correct? 24 A Yes. 25 MS. SCOTT: Your Honor, I would like to publish
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7062 Tardera-direct/Scott
1 also 1614 to the jury.
2 THE COURT: Yes.
3 (Whereupon, the exhibit/exhibits were published
4 to the jury.)
5 Q Looking back at page 70 of 804, the testimony is as
6 follows:
7 Question: Is this a photocopy of one of your
8 brochures that your company uses?
9 Answer: We do not use this brochure and have
10 not. We did use it at one time. We do not use it now and
11 haven't used it for quite a while.
12 Question: When did you have your first Who's Who
13 Worldwide seminar?
14 Answer: December -- I know the plane left the
15 conference about December 28th to Vietnam and Hong Kong.
16 Question: In 1993?
17 Answer: In 1993, right.
18 Question: And was that a relatively new -- that
19 was the first time you had offered that service; is t
hat
20 right?
21 Answer: Right, that's correct.
22 I will ask you to look at
23 Government's Exhibit 804, page 170. 24 This is also Bruce Gordon testifying. Can you 25 tell us who is questioning here?
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7063 Tardera-direct/Scott
1 THE COURT: What page is this?
2 MR. WHITE: 174.
3 MS. SCOTT: The numbering is confusing because it
4 is on February 22nd. If you go past page 183, you will
5 find page 174.
6 THE COURT: I don't have it.
7 (Handed to the Court.)
8 MR. TRABULUS: It appears as part of my Exhibit
9 811.
10 THE COURT: Let's take a look.
11 I have it as 811.
12 MS. SCOTT: Let me make it clear that I am
13 reading from 811, which is also in evidence. Page 174.
14 Q Can you tell us here who is questioning Mr. Gordon?
15 A The question h
ere were being asked by Mr. Pierce, who
16 is the attorney for Who's Who Worldwide Registry.
17 MS. SCOTT: Your Honor, I was mistaken,
18 Government Exhibit 811 is not in evidence, but it was
19 stipulated by the parties as an accurate record of the
20 proceedings. So I offer it in evidence at this time.
21 THE COURT: Any objection?
22 MR. TRABULUS: I am not exactly sure what 811
23 consists of. My copy begins with a cover page for 24 testimony in the bankruptcy proceeding and proceeds to the 25 trial in the Reed Elsevir case. There may be an error in
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7064 Tardera-direct/Scott
1 compiling it, or my copy of it. I would like to see what
2 811 is.
3 THE COURT: If you look, the one I have has two
4 first pages.
5 MR. TRABULUS: Yes, that's the error.
6 THE COURT: I think the first page
should not be
7 in there.
8 MR. TRABULUS: That's what I thought as well.
9 MR. WHITE: That's correct, your Honor. It got
10 stuck on the wrong cover page.
11 THE COURT: So put the 811 on the second cover
12 page.
13 MR. TRABULUS: With that I have no objection.
14 THE COURT: Government's Exhibit 811 in evidence
15 as revised.
16 (Government's Exhibit 811 received in evidence.)
17 Q Starting at the top of page 174.
18 Question: In the rest of the Exhibit 176, after
19 the software package, there is listed as a member benefit
20 the Who's Who Worldwide Business Seminars. Has that
21 actually occurred? Has this benefit been provided,
22 Mr. Gordon?
23 Answer: Yes. 24 Question: When did it start? 25 Answer: December 28th.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7065 Tardera-direct/Scott
1
Question: Of 1993?
2 Answer: 1993.
3 Question: And where was this first -- this was
4 the first seminar then?
5 Answer: Right.
6 Question: What was the purpose of it?
7 Answer: To orient our members on the local laws
8 in the country, to meet with officials of the country,
9 import-export. This just came out. Really in a business
10 sense more than a vacation.
11 Question: I'm sorry, I didn't hear.
12 Answer: Business more than vacation.
13 Question: Okay.
14 Now, where was this first seminar?
15 Answer: Hong Kong and Vietnam.
16 Question: This is something arranged by or on
17 behalf of Who's Who Worldwide?
18 Answer: Yes.
19 Question: Were anybody but members invited to
20 attend seminar?
21 Answer: A law group. Lawyers.
22 Question: Okay.
23 And what was the purpose of having lawyers? 24 Answer: You ge
t several groups together and it's 25 cheaper that way.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7066 Tardera-direct/Scott
1 Question: Okay.
2 But the invitation went out to the membership?
3 Answer: Yes.
4 Now, Mr. Tardera, can you tell us how this
5 testimony was relevant to the issues at trial, the issues
6 raised at the trial between Reed Elsevir and Who's Who
7 Worldwide?
8 MR. TRABULUS: Objection, your Honor.
9 THE COURT: On what ground?
10 MR. TRABULUS: It is really calling for a
11 statement of law.
12 THE COURT: No. Whether this testimony is
13 material for the jury to determine. However, this is that
14 lawyer representing one of the parties. I think he can
15 give an opinion as an expert witness, sort of; or even as
16 a lay lawyer witness as to what he thought was important
17 in the trial.
18 Overruled.
19 A In a trademark litigation, an important or critical
20 issue is whether there is a likelihood of confusion. That
21 is, whether what Who's Who Worldwide Registry was doing
22 was likely to confuse consumers into believing that the
23 publications that Who's Who Worldwide Registry was selling 24 was related to Reed Elsevir's publications. 25 Courts in deciding as to whether there is a
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7067 Tardera-direct/Scott
1 likelihood of confusion look at certain factors. One of
2 them is called the proximity or the closeness between the
3 two products.
4 The best example I can give, I guess, if there is
5 a famous trademark called brand X, and one company is
6 selling steam shovels, and another company is selling
7 butter, those two products are not really closely related,
8 and there is less of a chance that there would be a
9 likelihood of confusion.
10 If the two companies are using brand X, and one
11 is selling butter and the other is selling margarine, now
12 there is a proximity or closeness of the two products to
13 make it more likely that there would be confusion.
14 This testimony was used in the appeal to show
15 that Who's Who Worldwide's products were different from
16 Reed Publications. They were ready to show that Who's Who
17 Worldwide Registry was more of a membership or service
18 organization, as opposed to a company that published
19 books.
20 Q So, if in fact Who's Who Worldwide did offer seminars
21 and conferences to its members, what would be the effect
22 on the question whether it was infringing the trademarks
23 with respect to Reed Elsevir? 24 A That would be evidence that the products were less in
25 proximity or less close to each other, or less similar, so
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7068 Tardera-direct/Scott
1 that there would be less of a likelihood of confusion.
2 That would have been one of the elements that a court
3 would have considered in deciding that there was less of a
4 likelihood or more of a likelihood of confusion.
5 THE COURT: So, what you are saying is that this
6 point would be brought up by the defense, by Who's Who
7 Worldwide, to show that there wasn't -- that the two
8 products were not similar?
9 THE WITNESS: Yes.
10 THE COURT: When you say likelihood of confusion,
11 you mean likelihood of confusion to what people? To
12 whom?
13 THE WITNESS: The consumers.
14 THE COURT: The consumers?
15 THE WITNESS: Yes.
16 THE COURT: As to the source of the product?
17 THE WITNESS
: Yes, precisely.
18 THE COURT: If one company did seminars, and the
19 other didn't, that would be a separating factor?
20 THE WITNESS: Yes.
21 MS. SCOTT: Thank you, Mr. Tardera. No further
22 questions.
23 THE COURT: Cross-examination. 24 25
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7069 Tardera-cross/Trabulus
1 CROSS-EXAMINATION
2 BY MR. TRABULUS:
3 Q Good morning, Mr. Tardera, I am Norman Trabulus,
4 Mr. Gordon's attorney.
5 A Good morning.
6 Q You were not present yourself during the trial of
7 this litigation; is that correct?
8 A That's correct.
9 Q Is it fair to say in the outcome of this trial
10 Magistrate Judge Jordan determined that any showing of
11 confusion that had been made was negligible? Do you
12 recall the word "negligible?"
13 A I don't recall what his dec
ision said.
14 Q Now, in terms of whether or not there is any
15 likelihood of confusion, is it not true, sir -- withdrawn.
16 Sir, do you know whether there was any evidence
17 introduced at the trial that between the date of December
18 28th, 1993, and the date that Mr. Gordon was testifying,
19 which was both February 17th, 1994, and February 22nd,
20 '94, in that gap, in the time period between the two, was
21 there any evidence introduced at the trial that that
22 particular brochure was utilized?
23 A I don't recall any such evidence. 24 Q Was there ever any evidence introduced at the trial 25 that during that time period Who's Who Worldwide was
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7070 Tardera-cross/Trabulus
1 advertising that it had already had a seminar in Vietnam
2 and Hong Kong?
3 A I don't recall any such evidence
.
4 Q The brochure you have in front of you?
5 A I don't any longer. I think it was published.
6 THE COURT: I believe juror number seven has it
7 now.
8 (Handed to the witness.)
9 Q Sir, this brochure does not make a claim that any
10 seminar or conference has already been held, does it?
11 A Let me read it.
12 (Whereupon, at this time there was a pause in the
13 proceedings.)
14 A No.
15 Q I am correct in saying that?
16 A Correct.
17 Q And it just says that seminars and conferences were
18 being planned; is that correct?
19 A That's what it says.
20 Q Was there ever any evidence introduced at the trial
21 to show that in fact no seminars or conferences were being
22 planned?
23 A Being planned or occurred? 24 Q Being planned. 25 Any evidence introduced at the trial to show that
HARRY RAPAPORT,
CSR CP CM OFFICIAL COURT REPORTER 7071 Tardera-cross/Trabulus
1 a statement in that brochure that seminars and conferences
2 were being planned, to show that it was untrue?
3 A I don't recall any.
4 Q As you sit here today, do you have any reason to
5 believe that Who's Who Worldwide had no plan to conduct
6 and attend conferences?
7 A I have no way to know one way or another.
8 Q Do you have any proof as you sit here today that
9 Who's Who Worldwide did not plan to conduct a seminar in
10 Vietnam and Hong Kong?
11 A I don't know one way or the other.
12 Q Do you, as you sit here today know for a fact as to
13 whether or not a plane did leave to take people to a
14 conference in Vietnam and Hong Kong on December 28th?
15 A Do I personally know?
16 Q Do you know?
17 A No, I don't.
18 Q Do you know for a fact as to whether or not th
e
19 benefit, that is, the opportunity to go on this seminar
20 was actually provided to members of Who's Who Worldwide?
21 A Repeat the question?
22 Q I will rephrase it.
23 Do you know as to whether or not members of Who's 24 Who Worldwide were actually offered in advance the 25 opportunity to participate in a seminar in Vietnam and
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7072 Tardera-cross/Trabulus
1 Hong Kong?
2 A I don't know whether it was actually offered or not,
3 except from this brochure.
4 Q Do you know, sir, whether during the course of the
5 trial any of the attorneys who were present thought to ask
6 Mr. Gordon how many members of Who's Who Worldwide
7 actually attended the seminar, if any?
8 A I don't recall any such testimony.
9 Q Do you recall whether or not any of the lawyers
10 during that tr
ial asked Mr. Gordon whether he knew how
11 many people, if any, attended the seminar?
12 A I don't recall one way or another.
13 Q Can you point -- withdrawn.
14 You talked about the appellate record.
15 I will show you something where I think the
16 marking is incorrect on it. We will mark it Gordon AT for
17 Identification.
18 (Handed to the witness.)
19 Q Do you recognize this as the appendix that you helped
20 prepare?
21 (Handed to the witness.)
22 A Let me see. Yes.
23 Q And that contains the portions of the testimony at 24 the trial which one or both of the parties to the appeal 25 deemed important to the appeal?
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7073 Tardera-cross/Trabulus
1 A Yes.
2 Q Do you know from looking through it, or could you
3 look through it, or if there is any testimony in th
ere if
4 anybody asked Mr. Gordon if he knew that anybody from
5 Who's Who Worldwide Registry went on the seminar that was
6 offered to them?
7 A I don't believe the testimony is in here. I believe
8 the testimony on the seminars has already been read into
9 the record.
10 Q Basically the two exhibits we have there, 804 which
11 Ms. Scott read, and 811, which she read portions of,
12 that's everything in the entire trial that related to the
13 seminars; is that correct?
14 A I don't know if it is everything in the entire
15 trial. I am fairly certain that that is everything that
16 is in the entire record on the appeal with respect to the
17 joint appendix.
18 Q Were you familiar with the record of the entire
19 trial?
20 A I am sure I read it. I am not familiar with it as I
21 sit here today.
22 Q Do you believe, sir, that anybody asked Mr.
Gordon in
23 the record of the entire trial which I have here, if you 24 wish to look through it, do you believe that anybody asked 25 him whether or not he knew if anybody from Who's Who
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7074 Tardera-cross/Trabulus
1 Worldwide went on this seminar?
2 A I don't know one way or another.
3 Q Do you think if he was asked that question and gave
4 that answers, it is something the government would have
5 introduced in the allegations of perjury against him?
6 MS. SCOTT: Objection.
7 A I don't know.
8 THE COURT: Sustained, strike out the answer.
9 Q Now, sir, whether or not Who's Who Worldwide
10 advertised conferences or seminars, that would not be
11 relevant or not to whether people would confuse the name
12 Who's Who Worldwide with the name Who's Who in the World,
13 would it?
14 A If you are just talking about the similarity of
15 names --
16 Q Would not bear on the similarity of names?
17 A Well, similarity of names is one of the factors in
18 the variety of factor as court would review to determine
19 whether there was likelihood of confusion.
20 Q The issue of whether or not -- the question of
21 whether or not Who's Who Worldwide advertised that it was
22 going to have seminars, that is not something which would
23 bear one way or another as to whether or not the names 24 were sufficiently similar as to whether it would be 25 confusing? Is that fair to say?
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7075 Tardera-cross/Trabulus
1 A It would go to whether the products were confusing to
2 the consumer.
3 Q Whether the products were similar?
4 A Yes --
5 Q Regardless of the names?
6 A Comparing the name to the other is one of the factors
7 in the likelihood of confusion test.
8 Q Now, you indicated that Reed Elsevir is the
9 preeminent publisher of biographies in the United States?
10 A Biographical directories.
11 Q I misspoke. Biographical directories.
12 In terms of the biographical directory, it is
13 preeminent in, it publishes Who's Who in America?
14 A Yes.
15 Q Including Who's Who in the east, Who's Who in the
16 South, Who's Who in the West; is that right?
17 A Yes, sir.
18 Q And is it not correct that it currently also sells a
19 CD-ROM for about $1,700 which incorporates what is in its
20 directories?
21 A I don't know that.
22 Q Is it not correct, sir, that in obtaining names for
23 people to be included in its directories other than Who's 24 Who in America, it utilizes mailing lists; do you know 25 that,
sir?
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7076 Tardera-cross/Trabulus
1 A No, I don't.
2 Q Do you know that it now has the provision where
3 people -- withdrawn.
4 Are you aware, sir, that Reed Elsevir sends
5 letters to people whose names have been obtained from
6 mailing lists for inclusion in its directories for other
7 than Who's Who in America, and advises them they are
8 nominated, sir?
9 A I don't know that.
10 Q Are you aware, sir, that right now this preeminent
11 publisher of biographical directories allows people to
12 nominate themselves to be included in their directories?
13 A I have no knowledge of that.
14 Q Sir, are you currently working on any matters for
15 Reed Elsevir relating to its biographical directories?
16 A No.
17 Q I will show you Defendant's Exhibit Z, sir.
18 (Handed
to the witness.)
19 Q Do you recognize that as also being a portion of the
20 appellate record in the trial?
21 A I see it has a number at the top that indicates it
22 probably was one of the exhibit binders. I don't
23 specifically recall it. 24 Q Do you recall in preparing the appeal, the appellate 25 papers with respect to the testimony of an individual
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7077 Tardera-cross/Trabulus
1 named Sandra Barnes, the publisher of Marquis Who's Who?
2 A I know she testified at the trial.
3 Q She was a witness on behalf of Marquis?
4 A Reed Elsevir.
5 Q Reed Elsevir?
6 A Yes.
7 Q And do you recall that she testified that Reed
8 Elsevir used mailing lists? Do you recall that from the
9 trial testimony?
10 A I don't recall that testimony.
11 Q Is it that you don't recall on
e way or the other,
12 sir?
13 A I don't recall one way or the other.
14 Q Sir, I haven't marked this as an exhibit, but do you
15 recognize this as being one of the exhibit volumes to the
16 appeal?
17 (Handed to the witness.)
18 A Yes.
19 Q Does this refresh your recollection as or not
20 Defendant's Exhibit Z in this trial was part of the record
21 on appeal in the Reed Elsevir trial?
22 A Yes, it was.
23 MR. WHITE: Can I ask Mr. Trabulus what he is 24 referring to there? 25 MR. TRABULUS: Exhibit Z.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7078 Tardera-cross/Trabulus
1 MR. WHITE: No, the book.
2 MR. TRABULUS: I am referring to Exhibit volume 2
3 to the record on appeal in the Reed Elsevir against Who's
4 Who Worldwide Registry, Inc., appeal to the Second
5 Circuit. It bears docket number 95-
7331.
6 MR. WHITE: Are you referring to a particular
7 page?
8 MR. TRABULUS: Yes, referring to page E-952.
9 MR. WHITE: Thank you.
10 Q Now, Mr. Bailey, Mr. Tom Bailey whom you mentioned
11 before, sir, he was and is a partner in your law firm; is
12 that correct?
13 A Yes, he is.
14 Q And he occupies a position senior to you, not at this
15 time, but at the time of the trial?
16 A At the time he did. Now it is hard to say.
17 Q Now, do you recall, sir, that the record on appeal in
18 the trial contained a letter from this Sandra Barnes to
19 Mr. Bailey, suggesting he should try to have the postal
20 authorities confiscate the mail of Who's Who Worldwide,
21 and I am directing --
22 MS. SCOTT: Objection.
23 THE COURT: I didn't hear the end of the 24 question. 25 MR. TRABULUS: I was going to direct him to a
HARRY R
APAPORT, CSR CP CM OFFICIAL COURT REPORTER 7079 Tardera-cross/Trabulus
1 page.
2 THE COURT: What is the basis of the objection?
3 MS. SCOTT: Characterizing the contents of the
4 letter without it even being in evidence.
5 THE COURT: Without what?
6 MS. SCOTT: Without it being in evidence.
7 THE COURT: Can I hear the question, please?
8 (The court reporter reads the pending question.)
9 THE COURT: The document you are asking the
10 witness to look at. Is that in evidence?
11 MR. TRABULUS: No, it is not.
12 THE COURT: Sustained.
13 Q Mr. Bailey --
14 A Mr. Tardera.
15 Q I am sorry, I was thinking of Mr. Bailey.
16 THE COURT: That was a terrible slip. You just
17 heard the witness say that he and Mr. Bailey are now
18 even.
19 THE WITNESS: I don't think I quite said that.
20 THE COURT: We will not let that get out.
We
21 will keep it quiet.
22 Q I have marked this page as Defendant's Exhibit AU.
23 Do you recognize it as a page that was part of 24 the record on appeal? 25 MS. SCOTT: Page number?
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7080 Tardera-cross/Trabulus
1 MR. TRABULUS: E-945.
2 A Yes, it is part of one of the exhibit binders.
3 MR. TRABULUS: I would offer the exhibit in
4 evidence.
5 THE COURT: What is the exhibit page? EU, Easy
6 Uncle?
7 MR. TRABULUS: No, AU.
8 THE COURT: Abel Uncle.
9 What is it now?
10 MR. TRABULUS: A copy of a letter from Sandra
11 Barnes to Tom Bailey.
12 MS. SCOTT: We do object to it, your Honor.
13 THE COURT: What is the date of that letter?
14 MR. TRABULUS: April 8th, 1993.
15 THE COURT: Can I see it?
16 MR. TRABULUS: Sure.
17 (Handed to the C
ourt.)
18 MR. TRABULUS: I have put back Exhibit 1416 so
19 the jury can continue seeing it.
20 THE COURT: The jury has almost concluded seeing
21 it.
22 What is the basis for the admission of this
23 document. 24 To start off with, it is hearsay, is it not? 25 MR. TRABULUS: He testified as to his
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7081 Tardera-cross/Trabulus
1 recollection of things in the record or lack of
2 recollection, and I am testing it.
3 THE COURT: Recollection?
4 MR. TRABULUS: Yes, your Honor. And also, it is
5 a business record of Reed Elsevir.
6 THE COURT: I don't know whether it is. There is
7 no foundation for that.
8 MR. TRABULUS: He had been asked about what is in
9 the appellate record and what isn't; what is important to
10 the appeal and what isn't; he testified he recalled
11 certain things and others not, I am testing it.
12 THE COURT: You are testing it by putting this
13 evidence? You better test another way.
14 MR. TRABULUS: There was an objection before on
15 the grounds that it wasn't in evidence, and I am now
16 offering it in evidence so I can ask questions about the
17 substance of it.
18 THE COURT: You got past me again, Mr. Trabulus.
19 You lost me.
20 MR. TRABULUS: This is a letter, your Honor --
21 THE COURT: You are showing that he has selective
22 recollection of the record? Is that what you are trying
23 to show? 24 MR. TRABULUS: Not necessarily. 25 THE COURT: What are you trying to show, other
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7082 Tardera-cross/Trabulus
1 than trying to get this in, what are you trying to show,
2 which you will not succeed right now.
3
MR. TRABULUS: If I will not succeed, your Honor,
4 I will not speak further in front of the jury, but I
5 think --
6 THE COURT: Very well. I am sustaining the
7 objection, and that's for AU, Abel Uncle. You can use it
8 to refresh your recollection in any other manner, of
9 course.
10 It is for identification only, AU, Abel Uncle.
11 (Defendant's Exhibit AU marked for ID.)
12 (Whereupon, at this time there was a pause in the
13 proceedings.)
14 Q Mr. Tardera, do you know what your firm's fee
15 totalled to Reed Elsevir for representing it in the
16 litigation against Who's Who Worldwide?
17 MS. SCOTT: Objection.
18 THE COURT: Overruled.
19 A No, I don't.
20 Q Was it in the seven figures or six figures?
21 A I don't know.
22 Q Did you yourself prepare time entries for it? You
23 billed on an hourly basis; is that correct?
2
4 A Yes. 25 Q What was your hourly billing rate at that time?
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7083 Tardera-cross/Trabulus
1 A At the time I worked on the appeal in 1995?
2 Q Yes.
3 A 220, about.
4 Q And do you know what the total amount of time --
5 withdrawn.
6 Do you know how many hours you put in?
7 A I don't recall.
8 Q Do you know how many attorneys worked for Whitman
9 Breed Abbott and Morgan in total on this entire litigation
10 from starting it back in 1992 through the appeal?
11 A I can't say.
12 First there are two separate firms. It started
13 with Whitman and Ransom, and there was a merger of two
14 firms into Whitman Breed Abbott and Morgan. And with that
15 caveat, to the best of my recollection, five or six.
16 Q And did that include people whose hourly billing rate
17 was higher
than yours, such as Mr. Bailey?
18 A Yes.
19 Q Was there anyone else whose hourly billing rate was
20 higher than yours?
21 A I don't know. I don't think so.
22 Q Was there a Mr. Mallard involved also at one point?
23 THE COURT: How do you spell that? 24 MR. TRABULUS: M A L L A R D. 25 A He was involved with the trial, yes.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7084 Tardera-cross/Trabulus
1 Q Was his hourly billing rate -- do you know what his
2 hourly billing rate was?
3 A I don't know.
4 Q Do you know how many hours approximately Mr. Bailey
5 spent on this?
6 A No.
7 Q Do you have a best estimate as to whether the legal
8 fee was in excess of $250,000?
9 A I don't know.
10 Q Do you know the total legal fee -- withdrawn.
11 Whitman Breed Abbott also represented Reed
12 Elsevir in
the bankruptcy proceeding involving Who's Who
13 Worldwide for a certain period of time, did it not?
14 A Yes.
15 Q You yourself were involved in that, were you not?
16 A To a limited extent. I believe there was an
17 adversary proceeding and I had a limited role in that.
18 Q Do you know what Whitman Breed Abbott's legal fee
19 totalled for representing Reed Elsevir in the bankruptcy
20 proceeding?
21 A No.
22 Q Do you know, sir, what happened to the contents of --
23 withdrawn. 24 Do you know, sir, what happened to the 25 furnishings and the art work in the penthouse apartment
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7085 Tardera-cross/Trabulus
1 that Sterling had? Do you know what happened to it in the
2 bankruptcy proceedings?
3 A No.
4 Q Do you know, sir, what is happening -- what happened
5 to the
Manhasset condominium that PBI, Inc. owned?
6 A No.
7 Q Were you aware, sir, that your partner, Mr. Bailey
8 was in court just this last Friday in relation to a sale
9 of that condominium with the proceeds to go either to the
10 U.S. government or to the trustee in bankruptcy?
11 MS. SCOTT: Objection.
12 THE COURT: I assume it is to show an interest.
13 It is going far afield to do that.
14 If Mr. Bailey was in court for a proceeding on
15 Friday --
16 MR. TRABULUS: I withdraw the question, your
17 Honor.
18 THE COURT: All right.
19 MR. TRABULUS: I made a mistake.
20 Q Sir, I think you referred to the complaint in the
21 amended complaint prepared by your firm in the Reed
22 litigation?
23 A Yes. 24 Q And is it correct, sir, that nowhere in either the 25 complaint or the amended complaint -- withdrawn. Let me
HAR
RY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7086 Tardera-cross/Trabulus
1 just step back.
2 The complaint and the amended complaint set forth
3 the allegations that Reed Elsevir was putting forward as a
4 basis for claiming that it was entitled to some kind of
5 legal relief against Who's Who Worldwide; is that correct?
6 A Yes, it is.
7 THE COURT: Do you want to pull the microphone
8 closer to you?
9 THE WITNESS: I am sorry. I'll lean closer.
10 THE COURT: Which ever you prefer.
11 THE WITNESS: Okay.
12 Q I think you mentioned, sir, the amended complaint
13 included allegations of false advertising; is that
14 correct?
15 A Yes.
16 Q And those allegations related to similarity of the
17 names being used; is that correct?
18 A In part.
19 Q Sir, there was certainly -- is it correct, sir, that
20 there was no a
llegation in either the complaint, whichever
21 the, or the amended complaint, that Who's Who Worldwide
22 was falsely advertising that it was planning seminars and
23 conferences; is that correct, sir? 24 A I believe that is correct. 25 MR. TRABULUS: Your Honor, can you bear with me a
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7087 Tardera-cross/Trabulus
1 moment?
2 THE COURT: Surely.
3 (Whereupon, at this time there was a pause in the
4 proceedings.)
5 MR. TRABULUS: No further questions.
6 THE COURT: Anyone else?
7 MR. NELSON: I just have a few questions, Judge.
8
9 CROSS-EXAMINATION
10 BY MR. NELSON:
11 Q Good morning, Mr. Tardera.
12 A Good morning.
13 Q Mr. Tardera, am I correct that Thomas Bailey was the
14 trial attorney on the Reed litigation?
15 A He was one of them, yes.
16 Q And the judgment in the Reed lawsuit against Who's
17 Who Worldwide, when was that decision rendered as best as
18 you can recall?
19 A March 1994.
20 Q And I believe you testified that subsequently Who's
21 Who Worldwide perfected an appeal of the decision of the
22 magistrate judge; am I correct?
23 A Yes. 24 Q And you were assigned to the responsibility of the 25 preparation of that appeal; is that correct?
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7088 Tardera-cross/Nelson
1 A Yes.
2 Q Now, am I correct that the appeal itself was first
3 argued in 1995?
4 A I am not sure whether that is true or not. Late
5 1995, early 1996.
6 Q So that litigation was continuing and ongoing, at
7 least in the appellate level, throughout 1995; is that
8 correct?
9 A I believe that's correct.
10 Q And i
t certainly would have been ongoing in December
11 of 1994; is that correct?
12 A I am not exactly sure if the notice of appeal was
13 filed until 1995.
14 Q Are you familiar with a gentleman by the name of Mark
15 Seeley, S E E L E Y?
16 A Yes.
17 Q And what, if any, connection does he have with Reed
18 Elsevir?
19 A He was an employee of Reed Elsevir.
20 Q And is he an attorney, if you are aware?
21 A I don't know.
22 Q Are you aware that Thomas Bailey and Mark Seeley met
23 with federal agents with respect to Who's Who Worldwide in 24 December of -- in December of 1994? 25 A No, I am not.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7089 Tardera-cross/Nelson
1 MR. NELSON: Thank you.
2 I have no other questions.
3 THE COURT: Anything else?
4 Any redirect?
5 MS. SCOTT: Yes, your Honor. Bu
t I believe it is
6 time for the break.
7 THE COURT: It would be normally. But we started
8 late. If you would like to take a break, we will,
9 however.
10 MS. SCOTT: May I ask for a ten minute break.
11 THE COURT: Members of the jury, we will recess
12 for ten minutes. Please do not discuss the case and
13 please keep an open mind.
14 (Whereupon, at this time the jury leaves the
15 courtroom.)
16
17 (Whereupon, a recess is taken.)
18 (Whereupon, the jury at this time entered the
19 courtroom.)
20 THE COURT: Please be seated, members of the
21 jury.
22 You may proceed.
23 24 25
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7090 Tardera-redirect/Scott
1 REDIRECT EXAMINATION
2 BY MS. SCOTT:
3 Q Mr. Tardera, do you remember that Mr. Trabulus asked
4 you some
questions on cross-examination about the content
5 of the appellate record?
6 A Yes.
7 Q Do you remember specifically he asked you whether
8 this appellate record contains portions of the testimony
9 which the parties deemed to be important to the appeal?
10 A Yes.
11 Q And do you remember that you answered yes to that
12 question?
13 A Yes.
14 Q And did Who's Who Worldwide in its appeals brief make
15 any reference to Bruce Gordon's testimony that a seminar
16 had taken place in Vietnam sponsored by Who's Who
17 Worldwide?
18 MR. TRABULUS: Objection.
19 THE COURT: Sustained.
20 Q What if any reference was made in the appeals brief
21 to Bruce Gordon's testimony?
22 MR. TRABULUS: Objection.
23 THE COURT: Sustained. 24 MS. SCOTT: Is that to form or substance? 25 THE COURT: Substance.
HARRY RAPAPORT, CSR C
P CM OFFICIAL COURT REPORTER 7091 Tardera-redirect/Scott
1 MS. SCOTT: Thank you. No further questions.
2 THE COURT: Anything else?
3 MR. TRABULUS: No, your Honor.
4 THE COURT: You may step down.
5 THE WITNESS: Thank you.
6 (Whereupon, at this time the witness left the
7 witness stand.)
8 THE COURT: Please call your next witness.
9 MR. WHITE: Your Honor, the government calls
10 Joseph Jordan.
11 THE COURT: Raise your right hand.
12
13 J O S E P H J O R D A N ,
14 called as a witness, having been first
15 duly sworn, was examined and testified
16 as follows:
17
18 THE COURT: Please be seated. State your full
19 name and spell your last name.
20 THE WITNESS: Joseph Jordan, J O R D A N.
21 THE COURT: You may proceed.
22
23 24 25
HARRY RAPAPORT, CSR CP CM
OFFICIAL COURT REPORTER 7092 Jordan-direct/White
1 DIRECT EXAMINATION
2 BY MR. WHITE:
3 Q Can you tell us how you are employed?
4 A I am employed as a Special Agent of the Internal
5 Revenue Service Criminal Investigation Division.
6 Q Can you describe to us what the duties of an IRS
7 Special Agent are.
8 A We investigate criminal violations of the income tax
9 laws, the banking laws, the money laundering statutes, and
10 other various federal statutes.
11 THE COURT: Pull the microphone closer, please.
12 THE WITNESS: Sure.
13 Q Can you tell us how long you have been an IRS
14 Special Agent?
15 A Since 1986.
16 Q And are you the agent who headed the investigation of
17 the tax part of this case?
18 A Yes, I was.
19 Q Now, were you on duty on May 17th, 1995?
20 A Yes, I was.
21 Q Can you tell us what yo
u were doing on that day?
22 A That day, myself and Inspector Biegelman interviewed
23 Martin Reffsin at his office at 333 Jericho Turnpike on 24 Long Island. 25 Q Can you tell us what happened at that time?
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7093 Jordan-direct/White
1 A We spoke about various topics. We spoke about
2 Mr. Gordon's relationship with Mr. Reffsin. We spoke
3 about the start up or the genesis of Who's Who. We spoke
4 about the ownership of Who's Who. We spoke about the
5 loans to Mr. Gordon of Who's Who. We spoke about the
6 condominium at Humming Bird Road. We spoke about various
7 corporations that were involved with Who's Who. And we
8 spoke about the financial condition of Who's Who at
9 certain points of time.
10 Q Can you give us an idea approximately how long this
11 interview lasted?
12 A Appro
ximately one hour.
13 Q Now, prior to when you began asking Mr. Reffsin some
14 questions, what happened?
15 A We arrived at his offices. We identified ourselves
16 to Mr. Reffsin. And we asked him if he would be willing
17 to speak to us and be interviewed, and he agreed.
18 Q Let's take the topics you mentioned one at a time.
19 What, if anything, did Mr. Reffsin say to you
20 regarding his relationship with Mr. Gordon?
21 A Mr. Reffsin said that he began his relationship with
22 Mr. Gordon in the early 1980's, where Mr. Reffsin was the
23 accountant for a company that Mr. Gordon had which was 24 called Television Media Associates. And that Television 25 Media Associates was an advertising company, and it was a
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7094 Jordan-direct/White
1 form of a tax shelter.
2 Mr. Reffsin told us he wa
s a certified public
3 accountant. Mr. Reffsin told us that he prepared
4 Mr. Gordon's business and personal tax returns since the
5 early 1980's, except for a brief hiatus sometime around
6 1988.
7 Mr. Reffsin told us that Mr. Gordon owed the
8 Internal Revenue Service approximately three million
9 dollars, which was for income taxes and penalties, and
10 that Mr. Gordon was taking loans from the company.
11 Q You said before that Mr. Reffsin said something
12 regarding the creation of Who's Who Worldwide. What did
13 he say about that?
14 A Mr. Reffsin told us a man called Jim Canino first
15 approached Mr. Reffsin, and Canino is C A N I N O; and
16 that Mr. Canino first approached Mr. Reffsin, and
17 Mr. Canino said that he wanted to start a company called
18 Who's Who Worldwide Registry, and that Mr. Canino had
19 first incorporated the name of Who's Who
Worldwide
20 Registry.
21 Then at some point in time Mr. Reffsin introduced
22 Mr. Gordon to Mr. Canino and then Mr. Canino is no longer
23 in the picture, and Mr. Gordon was then the owner of Who's 24 Who. 25 Q What did Mr. Reffsin say, if anything regarding the
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7095 Jordan-direct/White
1 ownership or finances of Who's Who Worldwide?
2 A As far as the finances of Who's Who Worldwide,
3 Mr. Reffsin said that for the first five years of
4 operation Who's Who Worldwide had a total net profit of
5 approximately one million dollars.
6 He told us the various net profits of the company
7 for certain years.
8 Q What did he say with respect to the ownership of
9 Who's Who Worldwide?
10 A With regard to the ownership of Who's Who Worldwide,
11 Mr. Reffsin said that he was told by
Mr. Gordon on a few
12 occasions that Mr. Gordon is the owner of Who's Who. And
13 he knows the Grossmans advanced Mr. Gordon $125,000 to
14 start up Who's Who. And approximately two years into the
15 operation of Who's Who, approximately June of 1992,
16 Mr. Gordon tells Mr. Reffsin that the Grossmans own Who's
17 Who Worldwide -- own stock in Who's Who Worldwide and not
18 Mr. Gordon.
19 At some point in time then Mr. Reffsin told us
20 that Mr. Gordon had expressed concerns to Mr. Reffsin.
21 And Mr. Gordon's concerns were that Mr. Gordon had
22 testified at some legal proceeding that he was the owner
23 of 75 percent of the stock of Who's Who Worldwide. And 24 Mr. Gordon was concerned, because Mr. Gordon told 25 Mr. Reffsin that he didn't own 75 percent of Who's Who
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7096 Jordan-direct/White
1 Worldwide; that the Grossmans did. And Mr. Gordon told
2 Mr. Reffsin that he just got confused on that issue.
3 Q Did Mr. Reffsin say anything to you regarding
4 Mr. Gordon's compensation from Who's Who Worldwide?
5 A Yes. Mr. Reffsin told us for the years 1993, 1994,
6 Mr. Gordon's salary was between 100 and $150,000 a year,
7 and while Mr. Gordon was on this salary he was taking
8 substantial loans from Who's Who Worldwide.
9 Q Did Mr. Reffsin say anything else regarding these
10 loans, about loans to Mr. Gordon?
11 A Yes. Mr. Reffsin had told us that that he had
12 expressed his concerns to Mr. Gordon about these loans,
13 and Mr. Reffsin expressed the concerns that there might be
14 a problem down the road of these loans, because there were
15 little if any repayment on the loans. And Mr. Reffsin 16 said Mr. Gordon's reply to him was, I will deal with it at
17 that time. And Mr. Reffsin did not mention that
18 Mr. Gordon said he was going to repay these loans at any
19 time.
20 MR. WALLENSTEIN: Objection. Move to strike.
21 THE COURT: What portions?
22 MR. WALLENSTEIN: The question is what did
23 Mr. Reffsin say and not what he did not say. 24 THE COURT: Can I hear the question and answer? 25 (Whereupon, the court reporter reads the
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7097 Jordan-direct/White
1 requested material.)
2 MR. WALLENSTEIN: I move to strike the last
3 portion.
4 THE COURT: Yes. Motion granted. Strike it
5 out. The jury is instructed to disregard the last
6 portion.
7 THE WITNESS: In addition, when Mr. Reffsin was
8 addressing these concerns to Mr. Gordon he was saying that
9 these loans could be considered income, and that's why he
10 felt
that there is this problem.
11 Mr. Reffsin also related to us that an employee
12 of Mr. Reffsin's company, a man named Michael Hynes,
13 H Y N E S, who lives in Suffolk County expressed similar
14 concerns to Mr. Reffsin while he was working on the books
15 and records of Who's Who Worldwide.
16 MR. WALLENSTEIN: Objection.
17 MR. WHITE: Your Honor, that's Mr. Reffsin's
18 statement.
19 THE COURT: On what grounds?
20 MR. WALLENSTEIN: Mr. Jordan's statements of what
21 Mr. Reffsin said of what Mr. Hynes said. That's my
22 objection.
23 THE COURT: Overruled. 24 THE WITNESS: I will finish that answer. 25 And he even went as far as giving us Mr. Hynes'
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7098 Jordan-direct/White
1 address and telephone number.
2 Q Now, what, if anything, did Mr. Reffsin say to you
3 r
egarding the condominium at Hummingbird Road in
4 Manhasset?
5 A Mr. Reffsin told us that the condominium in Manhasset
6 was purchased sometime in 1993; that the condominium was
7 purchased for approximately $600,000, and another
8 approximately $400,000 was invested in the condominium for
9 renovations and refurbishing; that the approximate
10 $100,000 that was spent for this condominium was spent by
11 a company called Publishing Ventures, Inc. and that
12 Publishing Ventures received the money to purchase and
13 furnish the condominium from Who's Who Worldwide; that
14 Mr. Gordon moved into the Hummingbird Road condominium in
15 approximately April of 1993; that Mr. Gordon was paying a
16 rent of approximately 2,000 to $2,500 a month. And that
17 Mr. Gordon had told him that the condominium was to be
18 used primarily for business purposes, for business
19 meetings
, business conferences, for out of town Who's Who
20 members to stay at when they come into town; and also that
21 Mr. Gordon would be living there.
22 Mr. Reffsin also told us that he thought what
23 Mr. Gordon was telling him about the condominium being 24 used for business purposes was in Mr. Reffsin's words, 25 bullshit.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7099 Jordan-direct/White
1 Q Now, did Mr. Reffsin say anything else regarding the
2 payment, or expenditures made in reference to this
3 condominium?
4 A Yes.
5 Mr. Reffsin told us that Mr. Gordon -- I am
6 sorry, that Mr. Reffsin had questioned Mr. Gordon about
7 why were such large amounts of money going to Joyce
8 Grossman, the interior decorator.
9 Mr. Reffsin said that Mr. Gordon's response was
10 that Joyce Grossman is handling many of the payments to
11 the contractors, and that's why she is getting all this
12 money.
13 Q Now, did Mr. Reffsin say anything regarding other
14 corporations besides Who's Who Worldwide that were
15 affiliated with Mr. Gordon?
16 A Yes.
17 He had mentioned a company called Who's Who
18 Executive Club, which Mr. Reffsin told us printed a
19 magazine, and that company was funded by Sterling Who's
20 Who and Who's Who Worldwide; and that Registry Publishing
21 was another company which wasn't really active; that there
22 was Federated Who's Who and Summit Who's Who. He didn't
23 have too much to say about that. And Williams' Who's Who, 24 which really wasn't active. 25 Q During this meeting did you and/or Inspector
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7100 Jordan-direct/White
1 Biegelman give anything to Mr. Reffsin?
2 A Yes. We g
ave him a grand jury subpoena for
3 documents.
4 Q And after this occasion that you just described in
5 May of 1995, did you ever interview Mr. Reffsin again?
6 A Yes.
7 Myself, Inspector Biegelman and another IRS
8 Agent, his name is Kris, with a K, and his last name is
9 Tchorznizki, T C H O R Z N I Z K I.
10 Q Tell us where this interview took place?
11 A This interview took place at another one of
12 Mr. Reffsin's offices, which was at 333 North Broadway,
13 Long Island.
14 Q Tell us what happened when you arrived --
15 THE COURT: What is the date of this interview?
16 MR. WHITE: I am sorry?
17 THE COURT: What is the date of this interview?
18 THE WITNESS: I believe it is January 16th, of
19 1996.
20 MR. WHITE: Sorry if I left that out.
21 Q Can you tell us what happened when you arrived at
22 Mr. Reffsin's office?
23 A
We arrived at the offices. And then, you know, we 24 identified ourselves to Mr. Reffsin, and asked him if he 25 would be willing to speak to us regarding Who's Who
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7101 Jordan-direct/White
1 Worldwide and Mr. Gordon; and he agreed.
2 Q Did you give Mr. Reffsin anything during this
3 meeting?
4 A At the beginning of the interview we gave Mr. Reffsin 5 another grand jury subpoena for documents.
6 Q Can you tell us approximately how long this interview
7 lasted?
8 A It was less than an hour.
9 Q And tell us what subjects were discussed in this
10 interview?
11 A Again, we discussed the ownership of Who's Who
12 Worldwide. We discussed the condominium at Hummingbird
13 Road. We discussed the loans from Who's Who Worldwide to
14 Sterling Who's Who, and to Publishing Ventures, Inc. we
15 discussed the usage logs. We discussed Mr. Gordon's loans
16 from Who's Who Worldwide.
17 Q Let's start with what Mr. Reffsin said with regard to
18 the ownership of Who's Who Worldwide.
19 A Again, Mr. Reffsin told us that in the beginning he
20 was told by Mr. Gordon that Mr. Gordon was the owner of
21 Who's Who; and at some point in time, approximately two
22 years after Who's Who started business, Mr. Gordon told
23 Mr. Reffsin that he didn't own any stock in Who's Who; 24 that the Grossman family owned 20 percent of the stock in 25 Who's Who, and that Joyce Grossman personally owned 80
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7102 Jordan-direct/White
1 percent of the stock in Who's Who.
2 Q Now, what, if anything, did Mr. Reffsin say regarding
3 the condominium and the usage logs for that condominium?
4 A As far as the c
ondominium, Mr. Reffsin told us that
5 he knew that that was Mr. Gordon's residence, and that he
6 didn't know of any other place that Mr. Gordon used for a
7 residence.
8 Q And with respect to the usage logs for the condo,
9 what did he say?
10 A With regard to the usage logs, Mr. Reffsin had told
11 us that he had never seen the usage logs, didn't know what
12 was in the usage logs, didn't know who prepare the usage
13 logs, didn't have any conversations with anyone about the
14 usage logs; didn't know if the usage logs were falsified,
15 and didn't know if in fact anyone falsified the logs.
16 Then at a point later in the interview
17 Mr. Reffsin was again asked about these usage logs.
18 Then Mr. Reffsin told us at a point in time
19 Mr. Gordon had showed Mr. Reffsin the usage logs.
20 Mr. Reffsin then reviewed the usage logs when he
21 was shown them, an
d told Mr. Gordon they were totally
22 inaccurate, and didn't show anything to anybody, and
23 instruct Mr. Gordon to have them redone. And Mr. Reffsin24 says he had never seen them after they were redone. 25 Q Now, did Mr. Reffsin say anything regarding the
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7103 Jordan-direct/White
1 bankruptcy order to keep the logs?
2 A Yes. Mr. Reffsin told us that he and Mr. Gordon were
3 present in court when the attorneys for Reed asked that
4 Who's Who Worldwide be ordered to keep the usage logs; and
5 he said that the judge ordered Who's Who to keep these
6 usage logs.
7 Q What if anything did Mr. Reffsin say regarding
8 Mr. Gordon's loans from the corporation?
9 A He said that the loans Mr. Gordon was taking from the
10 corporation was used to pay Mr. Gordon's personal living
11 expenses, his Am
erican Express bill and his expenses for
12 clothing, and that these were charged to Mr. Gordon's loan
13 account.
14 He also said that he had seen or reviewed
15 Mr. Gordon's American Express bills and that they were
16 also charged to Mr. Gordon's loan account.
17 He said there were little if any repayments made
18 by Mr. Gordon on these loans; that there were no notes to
19 evidence the loans; and Who's Who Worldwide did not charge
20 Mr. Gordon any interest for these loans.
21 Q Did Mr. Reffsin say anything regarding loans from
22 Who's Who Worldwide to Sterling or Publishing Ventures?
23 A Yes. 24 Mr. Reffsin had told us that loans were made from 25 Who's Who Worldwide to both Sterling Who's Who and
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7104 Jordan-direct/White
1 Publishing Ventures sometime in 1993.
2 At first M
r. Reffsin said that there were -- that
3 notes were prepared at the time the loans were made. Then
4 Mr. Reffsin shortly thereafter said that the notes were
5 prepared at a subsequent date to the loans being made, but
6 he didn't recall the date. Then Mr. Reffsin told us that
7 he didn't learn of the existence of the notes for these
8 two loans until approximately three or four or a few
9 months prior to the bankruptcy filing of Who's Who.
10 Then Mr. Reffsin told us the first time he knew
11 of the existence of the notes was the night before Who's
12 Who Worldwide filed for bankruptcy. And the reason he
13 knew that is because Mr. Gordon told him at that time.
14 Q Did there come a time you terminated the interview?
15 A Yes. At one point in the interview Inspector
16 Biegelman told Mr. Reffsin that he didn't feel --
17 MR. TRABULUS: Objection, your Honor.
18 THE CO
URT: Sustained.
19 Q Without telling us what was said to Mr. Reffsin at
20 this point, did Mr. Reffsin say anything else?
21 A Yes.
22 MR. TRABULUS: Objection, your Honor. May we
23 approach? 24 THE COURT: All right, come up. 25
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7105 Jordan-direct/White
1 (Whereupon, at this time the following took place
2 at the sidebar.)
3 MR. TRABULUS: Your Honor, based upon the notes
4 of this interview which were prepared not by this witness,
5 but by Inspector Biegelman, but which basically track what
6 this witness has been testifying to, at this point
7 Biegelman told Reffsin that he, Reffsin, was not being
8 truthful, and suggested he retain an attorney.
9 At that point, according to Biegelman, Reffsin 10 said that he will tell everything; that he wanted
11 immunity. He
said he had had it before.
12 Biegelman then said to him, only an AUSA could
13 deal with that and he should have his attorney contact the
14 AUSA.
15 Now, although I will be asking for a limiting
16 instruction that his testimony concerning what Reffsin 17 said can't be considered against Gordon. But quite apart
18 from that the prejudicial effect of that coming out is
19 great, and I would ask it be excluded.
20 MR. WALLENSTEIN: I will join in that
21 application.
22 THE COURT: Why shouldn't it be excluded?
23 MR. WHITE: If I understand they are asking it be 24 exclude on 403 grounds. 25 THE COURT: I assume so.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7106 Jordan-direct/White
1 MR. WHITE: It is perhaps prejudicial. It is
2 certainly not unfairly prejudicial.
3 In other words, Mr. Reffsin by his request for
4 immunity, I will tell you everything if you give me
5 immunity, is clearly indicating a consciousness of guilt.
6 It is highly probative as to his state of mind. If he
7 doesn't think he did anything wrong, why does he say I
8 will tell you everything if you give me immunity?
9 THE COURT: Because I think that that is unduly
10 prejudicial. It is also part of negotiations. It may or
11 may not mean anything, and it certainly would mean
12 something to the jury. I don't know what this inference
13 is. It could be all kinds of dire consequences which I
14 will not let them speculate.
15 MR. WHITE: Ms. Scott did some research on this.
16 MS. SCOTT: I have some cases supporting our
17 position. One is United States against Levy. I can give
18 you cites.
19 MR. WALLENSTEIN: I can't hear you.
20 THE COURT: I will have to take a look at it.
21 You can't get i
nto the case now, unless you have it here
22 now and I can look at it quickly.
23 What does it say? 24 MS. SCOTT: It says in that case a person offered 25 to cooperate, plead guilty and cooperate. He did that
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7107 Jordan-direct/White
1 spontaneously, not in the context of plea negotiations.
2 And the Court found this was admissible because of the
3 fact that the parties were not involved in plea
4 negotiations at the time. So the rules governing plea
5 negotiations were not in effect. And it was probative --
6 THE COURT: What court is that?
7 MS. SCOTT: The Second Circuit, it is like
8 576 F.2d. I will have to get you the exact cite.
9 THE COURT: I will take a look at it.
10 MR. TRABULUS: In reviewing that, what preceded
11 this was not a voluntary spontaneous desire to cooperate,
12 was Biegelman telling him I think you are lying, you are
13 not being truthful. Get an attorney.
14 We suggest he was about to be charged, and that
15 brings it into the line of plea-type negotiations.
16 MR. WHITE: It doesn't. That's what this case
17 says. If you read it you will know that.
18 THE COURT: I would like to read it and I would
19 like to have defense counsel have an opportunity to read
20 it. So I will not let you go into it just yet. Okay?
21 MR. WHITE: Okay.
22 MR. WALLENSTEIN: I have a problem.
23 Some of what Agent Jordan testified to here 24 didn't actually come out during the meeting in which he 25 says it came out. Some of it was related to Agent Jordan
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7108 Jordan-direct/White
1 and Mr. White in the course of a proffer session.
2 THE COURT: If that is so why didn
't you object
3 to it?
4 Secondly, you can bring that out on
5 cross-examination and ask it be stricken.
6 MR. WALLENSTEIN: That makes it difficult. It
7 means I have to bring out the proffer sessions on cross
8 and it brings them all out on redirect. It is a kind of
9 back doorway to get into the proffer session.
10 THE COURT: You didn't object. You waived it by
11 not objecting, now I don't know what to do about it.
12 MR. WALLENSTEIN: It is one or two questions, but
13 I think Agent Jordan is confusing one or two sessions.
14 THE COURT: Why not show it to Mr. White during
15 the luncheon recess. I am sure if he agrees with you we
16 will stipulate here to remove some of it in some way.
17 MR. WHITE: Your Honor, because of the danger of
18 that I went through with Agent Jordan literally line by
19 line through the notes of the interviews to make sure that
20 the testimony at trial hewed to those inventories.
21 THE COURT: How do you spell hewed?
22 MR. WHITE: H E W.
23 THE COURT: I would rather you use that word 24 rather than the other word. 25 MR. WHITE: I believe it followed, the testimony
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7109 Jordan-direct/White
1 followed the interview line by line.
2 THE COURT: Mr. White denies it is from the
3 proffer and it is all from the interview, you can take a
4 look at that. And if you show him it is the proffer and
5 not the interview I am sure he will agree to you to work
6 it out.
7 MR. WALLENSTEIN: I am getting it secondhand
8 because I didn't represent Mr. Reffsin at the time of the
9 proffer, so it is secondhand.
10 THE COURT: You have the notes though.
11 MR. WHITE: Of course, several things were
12 repeated f
rom the interview and to the proffer.
13 THE COURT: Yes. But I believe Mr. Wallenstein
14 is alluding to things that only came out on the proffer.
15 MR. WHITE: I don't believe it is so. But if he
16 shows me I will look at it.
17 THE COURT: We will talk about law for a change
18 and then talk about the proffer, two things to look into.
19 MR. TRABULUS: Can we have a limiting instruction
20 and phrased this way, any statement made by Mr. Reffsin to
21 Mr. Jordan cannot be considered against Mr. Gordon.
22 THE COURT: Yes. They are admissions made by
23 Mr. Reffsin. 24 MR. WALLENSTEIN: I thought they were accusations 25 and not admissions.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7110 Jordan-direct/White
1
2 (Whereupon, at this time the following takes
3 place in open court.)
4 THE COURT: Members of the jury, this
testimony
5 that you are hearing, if you believe that it occurred, are
6 statements made by Mr. Reffsin. They are not offered
7 against the defendant Gordon. These are statements made
8 by the defendant Martin Reffsin.
9 Go ahead.
10 Q Now, let's leave that interview for a moment.
11 Were you on duty on March 30th, 1995?
12 A Yes, I was.
13 Q Where were you at that time?
14 A Participating in the execution of a search warrant in
15 the offices of Who's Who Worldwide at 1983 Marcus Avenue
16 in Lake Success.
17 Q Did you meet a man named Steve Rubin that day?
18 A Yes, I did.
19 Q How did you meet Mr. Rubin?
20 A Myself and Inspector Biegelman arrested Mr. Rubin.
21 Q Where did you arrest Mr. Rubin?
22 A In front of his house.
23 Q Where was his house? 24 A I believe it was on John Street in Elmont. 25 Q How did you come to
travel from Who's Who's offices
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7111 Jordan-direct/White
1 to Mr. Rubin's home?
2 A Well, that day we had found out that Mr. Rubin no
3 longer worked at Who's Who Worldwide. And we asked Liz
4 Sautter, one of the employs of Who's Who Worldwide if she
5 knew Mr. Rubin's address. And she told us she didn't know
6 the street name or the particular address of the house,
7 but she knew it was in Elmont, and if we drove her there
8 she would point out the street and the house to us, and
9 she did.
10 Q Tell us what happened at Mr. Rubin's home?
11 A Ms. Sautter indicated to us that Mr. Rubin lived
12 upstairs and we went around the side, and knocked on the
13 side door and rang the bell. No one answered. We went
14 around the front of the house and spoke to a woman who
15 identified herself as
Mr. Rubin's landlady and she
16 confirmed that Mr. Rubin lived there.
17 Q What happened next?
18 A As we were leaving the landlady's house, Mr. Rubin
19 comes walking up the walkway.
20 At that point Inspector Biegelman and myself
21 identified ourselves to Mr. Rubin. We told him he was
22 under arrest for mail fraud in connection with his
23 employment at the Who's Who Worldwide; and that he didn't 24 have to say anything to us. 25 Q And did Mr. Rubin make any request to you at that
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7112 Jordan-direct/White
1 time?
2 A Yes. He said that he would like to be allowed to go
3 up to his apartment to get some documents to give to us.
4 We went up to his apartment, and he gave us a
5 small batch of documents, and we left his apartment.
6 Q Now, after you left his apartment did Mr. Rubi
n have
7 any other requests for you?
8 A Yes. Mr. Rubin asked that he be allowed to go into
9 the trunk of his car, because he wanted to get some money
10 out of the car. And we agreed.
11 While the trunk of the car was open Mr. Rubin
12 pointed to another batch of documents and said that he
13 wanted us to have these documents. And it was at this
14 point in time that Mr. Rubin said that he wanted to sue
15 Mr. Gordon, because he felt that it was Mr. Gordon's fault
16 that he had gotten arrested.
17 Q And what happened then?
18 A At that point in time we told Mr. Rubin that we were
19 going to handcuff him. And he indicated to us that he had
20 a bad shoulder, so if we can handcuff him in the front.
21 And we agreed.
22 We handcuffed him in the front. We put him in
23 the front seat of my vehicle, seat belted him in. I drove 24 and Inspector Biegelm
an was sitting in the front. 25 As soon as we got under way I heard Inspector
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7113 Jordan-direct/White
1 Biegelman give Mr. Rubin his Miranda warnings.
2 Q What, if anything, did Mr. Rubin say after that?
3 A Mr. Rubin said that he understood his rights and he
4 still wanted to talk to us.
5 Q What did Mr. Rubin say after that?
6 A I heard Mr. Rubin say that he knew that he had lied
7 to customers on the telephone when he was working at Who's
8 Who Worldwide. He said that he lied to customers by
9 telling them that the conference at Hilton Head had taken
10 place, when in fact he knew that the conference had not
11 taken place.
12 He said he lied on the phone to customers
13 regarding how long he had worked at Who's Who. He
14 indicated he worked at Who's Who about a year, but he had
15 told customers he worked there about five years.
16 He also said that he lied on the phone to
17 customers when he told them that they were nominated,
18 because he said that he knew that customers weren't
19 nominated, and that their names came off a mailing list.
20 Q Now, when you were driving in your car where did you
21 go to?
22 A We drove back to 1983 Marcus Avenue; where at that
23 time we transferred Mr. Rubin out of my vehicle and into 24 Inspector Biegelman's vehicle. 25 Q Did you see Mr. Rubin after that on that day?
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7114 Jordan-direct/White
1 A No, I did not.
2 MR. WHITE: Your Honor, with the exception of the
3 matter we discussed at the bench, I have no further
4 question.
5 THE COURT: Very well. Cross-examination.
6
7 CROSS-EXAMINATION
8 BY
MR. TRABULUS:
9 Q Good afternoon, Agent Jordan.
10 Just a few questions.
11 I think you testified that in one of these -- you
12 testified to two conversations you had with Mr. Reffsin,
13 two meetings?
14 A That's correct.
15 Q And I think you testified in the second one he told
16 you that Mr. Gordon and Mr. Reffsin were present when the
17 judge in the bankruptcy proceeding ordered that logs be
18 maintained?
19 A That's correct.
20 Q Did he also tell you that Maria Gaspar be present
21 when the judge ordered that the logs be maintained?
22 A He did not mention that.
23 Q Before coming here today, Mr. Jordan, did you review 24 notes taken at this meeting by Mr. Biegelman? 25 A Yes, I did.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7115 Jordan-cross/Trabulus
1 Q You yourself did not take any notes of th
e meeting;
2 is that correct?
3 A That is correct.
4 Q And Biegelman took the notes; is that fair to say,
5 sir?
6 A That's correct.
7 Q And was Biegelman the one who did most of the
8 questioning?
9 A That's true, yes.
10 Q And that's true for both meetings, sir?
11 A Yes, that's true.
12 Q And it was Biegelman rather than you who took the
13 notes at the meetings, both meetings?
14 A That's correct.
15 Q And I have not marked this as an exhibit, but do you
16 recognize this as the notes of the interview of
17 Mr. Reffsin in which you and Biegelman and another agent
18 were present on January 19th, 1996?
19 (Handed to the witness.)
20 A Yes, I do.
21 Q These are the notes taken by Biegelman in his
22 handwriting?
23 A Yes. 24 Q And I will direct you to this portion here. 25 Does that refresh your
recollection that
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7116 Jordan-cross/Trabulus
1 Mr. Reffsin told you that Gaspar was also present when
2 Judge Jordan -- excuse me, when the bankruptcy judge
3 ordered the logs to be maintained?
4 MR. WHITE: What page are you referring to?
5 MR. TRABULUS: 3.
6 A Yes, it does.
7 Q So he didn't just say that he, Mr. Reffsin and
8 Mr. Gordon was present, but he also said Gaspar was
9 present at that point when the logs were ordered; is that
10 right, sir?
11 A That's correct.
12 Q In that sense your recollection was refreshed by
13 Inspector Biegelman's notes; is that correct?
14 A Yes.
15 Q And is it fair to say in general your recollection of
16 these meetings were substantially refreshed by Inspector
17 Biegelman's notes?
18 A Refreshed by the notes, yes.
19 Q Is it fair to say quite a few things you didn't
20 remember until you saw them in Inspector Biegelman's
21 notes?
22 A There were some things I did not remember, yes.
23 Q And is it fair to say that there was nothing that you 24 did remember that was not in Inspector Biegelman's notes? 25 A That's correct.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7117 Jordan-cross/Trabulus
1 Q I think you testified that Mr. Reffsin told you that
2 Mr. Gordon lived at 200 Hummingbird?
3 A To the best of my recollection.
4 Q That that's his residence he said?
5 A To the best of my recollection.
6 Q That he didn't know of any other residence?
7 A That's correct.
8 Q And he reached him at night there; is that fair to
9 say?
10 A Yes.
11 Q He didn't say he reached him at night at any
12 penthouse in the City, did he?
13 A No, he did not.
14 Q He didn't say he knew of a penthouse in the City of
15 being another residence, did he?
16 A I don't recall him mentioning that.
17 Q Sir, you said at the first meeting Mr. Reffsin told
18 you it was sometime in June of 1992, I think you said that
19 he learned from Mr. Gordon that the Grossmans were the
20 real owners of Who's Who Worldwide?
21 A That's correct.
22 Q I will show you again -- these are not marked as an
23 exhibit, but do you recognize these as being Inspector 24 Biegelman's notes of the first of the two interviews, the 25 one on May 17th, 1995.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7118 Jordan-cross/Trabulus
1 (Handed to the witness.)
2 A Yes, I do.
3 Q And I would like to refresh your recollection to the
4 second page of Inspector Biegelman's notes, does this
5 refresh your recollection that Mr. Reffsin told you it was
6 in 1991 that he learned that the Grossmans were the real
7 owners?
8 A No.
9 Can I tell you what my recollection is?
10 Q The question can be answered yes or no.
11 A I can't answer it yes or no.
12 Q Is it correct, sir, that Inspector Biegelman noted it
13 down as 1991 he learned that the Grossmans were the real
14 owners?
15 A Yes.
16 Q Agent Jordan, on December 21st, 1994, did there come
17 a point on that day that you had a meeting with Inspector
18 Biegelman and some representatives Reed Elsevir and their
19 attorneys?
20 A Can you give me the date once more, sir?
21 Q December 21st, 1994.
22 A Yes, I did.
23 Q And that was with Tom Bailey? 24 A I remember Mr. Bailey. 25 Q He was an attorney from Whitman Breed, whatever the
HARRY RAPAPORT, CSR
CP CM OFFICIAL COURT REPORTER 7119 Jordan-cross/Trabulus
1 name of that firm is?
2 A I believe so.
3 Q And they represented Reed Elsevir?
4 A I believe so.
5 Q Also present was a Mark Seeley?
6 A I don't recall the other gentleman's name, but I
7 recall there was another gentleman there.
8 Q He was actually an employee of Reed Elsevir; is that
9 correct?
10 A I don't know that.
11 Q Was that the first such meeting you ever had with
12 Mr. Bailey?
13 A Yes.
14 Q Was that the last such meeting you ever had with
15 Mr. Bailey?
16 A I believe I had met with Mr. Bailey one more time
17 after that.
18 Q And was Inspector Biegelman also present at that
19 second meeting?
20 A To the best of my recollection, no.
21 Q Do you know whether Inspector Biegelman had any
22 meetings with Mr. Bailey that you we
re not present at?
23 A I don't know. 24 Q Did you meet with Mr. Seeley, or we will call him the 25 gentleman with Mr. Bailey at the first meeting? Did you
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7120 Jordan-cross/Trabulus
1 ever meet with him again?
2 THE COURT: You have to slow down, Mr. Trabulus.
3 MR. TRABULUS: Sorry.
4 THE COURT: Do that again.
5 Q The meeting you had with Mr. Bailey and the gentleman
6 from Reed, was that the only meeting you had with that
7 gentleman from Reed?
8 A I don't recall either way the second gentleman being
9 at another meeting.
10 Q Do you know if Inspector Biegelman ever met with that
11 other gentleman?
12 A I don't know.
13 Q Do you know if Inspector Biegelman met with any other
14 attorney aside from Mr. Bailey --
15 A I don't know.
16 Q Do you know if In
spector Biegelman met with any other
17 employee of Reed other than that gentleman who was present
18 with Mr. Bailey?
19 A I don't know.
20 Q Now, in meeting with Mr. Bailey, was there any
21 discussion as to the proceedings in bankruptcy against
22 Who's Who Worldwide at the first meeting?
23 A I don't recall that much discussion about the 24 bankruptcy. 25 Q Was there any discussion that just on the very next
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7121 Jordan-cross/Trabulus
1 day Reed was going to be seeking the appointment of a
2 trustee for Who's Who?
3 MR. WHITE: Objection. The whole area is beyond
4 the scope --
5 THE COURT: Sustained.
6 THE COURT: Beyond what?
7 MR. WHITE: Beyond the scope of the direct.
8 THE COURT: On that ground overruled.
9 MR. WHITE: What was the other ground for which
10 it was sustained?
11 THE COURT: Proceed. I was about to say
12 something but I am not going to.
13 A Can you ask the question again, please?
14 Q I think the question was at the first meeting of
15 Mr. Bailey and the other gentleman, was there any
16 discussion that Reed was about to consider the appointment
17 of a trustee?
18 A I can't recall, sir.
19 Q Was there any discussion made by Mr. Bailey that the
20 postal inspectors seized the mail of Who's Who Worldwide?
21 A Not that I remember.
22 Q Was Mr. Bailey and the gentleman with him, were they
23 urging the postal inspectors to take action against Who's 24 Who Worldwide? 25 A Not that I recall, sir.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7122 Jordan-cross/Trabulus
1 Q Do you know who set up the meeting, who requested it?
2 A No, I don't.
3 Q Do you know if they requested it as opposed to
4 Inspector Biegelman?
5 A I don't know.
6 Q Did they ask -- withdrawn.
7 At any time during the course of that meeting,
8 was there any discussion with them concerning criminal
9 charges to be brought against Who's Who Worldwide or
10 Mr. Gordon, or anybody else?
11 A Not that I recall.
12 Q Was there any discussion during that meeting
13 concerning whether or not the word -- the use of the word
14 "nominate" by Who's Who Worldwide was appropriate or
15 inappropriate?
16 A I don't recall that.
17 Q Did they gave you documents during that meeting?
18 A I remember receiving either a one or a two-page
19 document with some information about tax issues.
20 Q From Mr. Bailey?
21 A That's correct.
22 Q Tax issues of Mr. Gordon or Who's Who Worldwide?
23 A Of Mr. Gordon. 24 Q
Mr. Gordon had material relating to Mr. Gordon's tax 25 issues?
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7123 Jordan-cross/Trabulus
1 A Yes.
2 Q Now, did Mr. Bailey tell you he was involved in any
3 tax issues of Mr. Gordon?
4 A No, he did not.
5 Q Did he explain how he came into possession of
6 materials relating to Mr. Gordon's personal affairs?
7 A Did he explain to me how he got the information? I
8 don't recall if he did. I can tell you what he gave me,
9 what it said.
10 Q I didn't ask you that.
11 Were you present throughout the entire portion of
12 the meeting or did you leave at any time when
13 Mr. Biegelman was speaking to him?
14 A I believe I left for a period to attend to making a
15 telephone call.
16 Q So there was a portion of the meeting that did not
17 concern you; is that fair to say
?
18 A No.
19 Q Do you know if tax issues -- issues other than tax
20 issues discussed with Mr. Bailey and other people?
21 A In my presence or absence?
22 Q Your presence first.
23 A Ask it again. 24 Q When you were there did Mr. Bailey discuss anything 25 other than tax issues?
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7124 Jordan-cross/Trabulus
1 A Not that I can recall.
2 Q Do you know whether when you left, the understanding
3 was that there were going to be other issues that were to
4 be discussed that didn't involve taxes?
5 A I don't have an understanding either way.
6 Q When you left did you understand that there were
7 things to be discussed at that point that you didn't need
8 to be present for?
9 A No. I had to make phone calls.
10 Q The phone calls related to the Who's Who Worldwide
11 investigation you were conducting at that point, or the
12 tax investigation?
13 A No.
14 Q You were involved in the tax aspect of this
15 investigation; is that fair to say?
16 A That's correct.
17 Q And you were not involved in planning out --
18 withdrawn.
19 You were involved only, or at most, as an
20 observer in the so-called mail fraud portion of the
21 investigation; is that correct?
22 A I wouldn't characterize it that way; so I can't
23 answer your question. 24 (Mr. Trabulus confers with Mr. Gordon.) 25 Q During the course of the tax aspect of the
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7125 Jordan-cross/Trabulus
1 investigation, did you have occasion to gather the various
2 tax returns, the filings that had been said to have been
3 made by or on behalf of Mr. Gordon?
4 A You are referrin
g to tax returns?
5 Q And the Form 430As?
6 A Yes.
7 Q And you have been here throughout the entire trial,
8 have you not, sir?
9 A Yes.
10 Q And there are some forms 430-A or 433-As in evidence;
11 is that correct, sir?
12 A Yes.
13 Q And they are information collection statements?
14 A Whatever the forms are, yes.
15 Q And we had a couple of them blown up real big; do you
16 recall that?
17 A Yes.
18 Q They had places for necessary living expenses; do you
19 recall that, sir?
20 A Yes.
21 Q And during the course of your investigation did you
22 ever come to look for the instructions that the IRS
23 prepares as to how to prepare collection information 24 statements? 25 A No.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7126 Jordan-cross/Trabulus
1 Q Did it occur to you,
sir, that in interpreting the
2 answers on a collection information statement, that it
3 might be useful to look at the instructions that were
4 given to the person who prepared it?
5 A Ask me the question again, please.
6 Q Did you think in interpreting whether or not a
7 collection information statement was filled out properly,
8 that it might be useful to look at the IRS's own
9 instructions as to what was supposed to be on it?
10 A I didn't find it necessary.
11 Q Agent Jordan I will show you AV,
12 Defendant's Exhibit AV for Identification.
13 (Handed to the witness.)
14 Q Have you ever seen that form before?
15 A No.
16 Q Can you tell by looking at it whether or not it is
17 the IRS's instructions for how to prepare collection
18 information statements as they were in June of 1991?
19 A I could read what it says, but I can't be certain.
20 Q Are you familiar with that little printed logo that
21 appears down there?
22 A I have seen that logo before, yes.
23 Q Is that the logo that the information puts on 24 publications that it makes? 25 A Yes.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7127 Jordan-cross/Trabulus
1 Q Next to it, is it an indication as to when it was
2 last revised?
3 A Yes, it is.
4 Q And all the way in the lower right-hand corner, is
5 there another date, which is the date that this particular
6 run was printed?
7 A I don't know what the date means, but I see the date.
8 (Mr. Trabulus confers with Mr. White.)
9 Q Do you know, sir, whether a collection information
10 statement is supposed to list all of somebody's expenses
11 or just their reasonable expenses?
12 A It is my understanding that all of your expenses has
1
3 to be listed on there, that you consider --
14 Q Necessary?
15 A -- that you consider a need to spend.
16 Q Do you recall the statements saying necessary living
17 expenses on them, as a heading on them?
18 A Yes.
19 Q And is it your understanding that a person who fills
20 one of them out is supposed to put expenses that are
21 aren't necessary?
22 MR. WHITE: Objection. He is asking what his
23 understanding of a firm is. 24 THE COURT: Just the word "objection is 25 sufficient.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7128 Jordan-cross/Trabulus
1 Can I hear the question, Mr. Reporter?
2 (Whereupon, the court reporter reads the
3 requested material.)
4 THE COURT: Overruled.
5 A Can I have the question again?
6 Q I will rephrase it to make it clearer.
7 We are talking about the collection info
rmation
8 statement, and we all recall without bringing the charts
9 out, that there is a place up here saying necessary living
10 expenses; is that correct?
11 A Yes.
12 Q Under there someone is supposed to list stuff?
13 A Yes.
14 Q Only to list what is necessary?
15 A They are supposed to list all their expenses.
16 Q Isn't the purpose for that to just list what they
17 need to live on?
18 A I don't know what the purpose of the form is, but I
19 know what has to be on it.
20 Q Well, isn't the form used by the IRS to determine --
21 withdrawn.
22 Well, one of the things you were investigating
23 was whether or not Mr. Gordon filed false statements? 24 A Yes. 25 Q And in the form of investigating that you didn't take
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7129 Jordan-cross/Trabulus
1 it upon
yourself to look at what the instructions for the
2 forms were; is that correct?
3 A I didn't need to look at the instructions.
4 Q Now, one of the other things that you were
5 investigating in connection with this was the offer in
6 compromise, or the offers in compromise; is that fair to
7 say?
8 A Yes.
9 Q And in doing that did you have occasion to look at
10 the instructions that the IRS prepares for offers and
11 compromise?
12 A No.
13 Q Did you know, sir, that the IRS in giving those
14 instructions tells the person preparing them in
15 considering their own debts, only to include debts which
16 have priority over the IRS's own claim?
17 A I don't know that.
18 Q Did you know, sir, in preparing an offer in
19 compromise, you are not to consider, the person preparing
20 it, calculating what they propose to pay, should not
21
consider amounts they owe on credit cards?
22 A I don't know that either way.
23 Q And, they are not to consider loans that they obtain 24 without pledging assets as security; did you know that, sir? 25 A No, I did not.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7130 Jordan-cross/Trabulus
1 Q Did you know, sir, if a collection information
2 statement was prepared for purposes of an offer, preparing
3 an offer in compromise, there is no reason to put on it
4 credit card loans, or loans that are not a pledge in
5 assets for security?
6 A I don't know that.
7 Q Again, you did not look at the reasons for the
8 preparation of an offer in compromise; is that correct?
9 A That's correct.
10 (Mr. Trabulus confers with Mr. Wallenstein.)
11 Q With regard to the collection information statement,
12 do you know whether a person who fi
lls one out is supposed
13 to include non-recurring medical expenses as an expense?
14 A If you show me the form.
15 Q The form or the instructions?
16 A The form.
17 Q Would you like to see the instructions, too?
18 A No.
19 THE COURT: Why don't you show it to him when we
20 return from lunch.
21 MR. TRABULUS: Sure.
22 THE COURT: Members of the jury, we will recess
23 at 1:30 from lunch. Please do not discuss the case among 24 yourselves or anyone else, until the end of the trial when 25 you are in the jury room deliberating.
HARRY RAPAPORT, CSR CP CM OFFICIAL COURT REPORTER 7131 Jordan-cross/Trabulus
1 Keep an open mind. Come to no conclusions. We
2 will recess until 1:30.
3 Have a good lunch.
4 (At this time the jury leaves the courtroom.)
5 MR. WHITE: Your Honor, before you leave, may we
6 speak to
you, please?
7 THE COURT: Yes.
8 MR. WHITE: I don't want to encroach on anyone's
9 lunch hour, but the issue about the immunity, can we get
10 to it maybe five minutes before?
11 THE COURT: 25 after 1:00.
12 MS. SCOTT: Your Honor, may I hand up the case?
13 THE COURT: Yes, bring it up, please.
14 (Handed to the witness.)
15 MS. SCOTT: I will refer you in Levy to page 900,
16 and in Biaggi to page 690.
17 THE COURT: There are two cases in here?
18 MS. SCOTT: That's correct. Biaggi, only a part
19 of the case had been copied for you. It is a large case.
20 THE COURT: 690?
21 MS. SCOTT: Yes.
22 THE COURT: Very well.
23 MS. SCOTT: I made a mark on there, and I will be 24 prepared to argue it when we come back. 25 (Luncheon Recess.)
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7132 Jordan-cross/Trabulus
1 A F T E R N O O N S E S S I O N.
2 MS. SCOTT: Your Honor, I will be doing the
3 argument.
4 THE COURT: Which one are we taking up now, the
5 last issue?
6 MS. SCOTT: Yes, the argument about the immunity.
7 THE COURT: Have you had an opportunity,
8 Mr. Wallenstein, to look at those cases?
9 MR. WALLENSTEIN: I haven't had a chance to
10 Shepardize it but I've had a chance to read it, Your
11 Honor.
12 THE COURT: What do you think?
13 MR. WALLENSTEIN: Judge, it's my position that
14 this case is easily distinguishable and does not --
15 THE COURT: When you say "this case," what do you
16 mean?
17 MR. WALLENSTEIN: United States v. Levy, 578 F.2d
18 896, and that's the case that Ms. Scott handed me before
19 lunch. The case upon which the government relies for the
20 proposition that Mr. Reffsin's testimony, that
21 Mr. Jordan's te
stimony can be that Mr. Reffsin said I'll
22 tell you everything if you give me immunity. I think that
23 on its face this case does not stand for the proposition 24 that that testimony is admissible and that it is 25 distinguishable for a lot of reasons.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7133 Jordan-cross/Trabulus
1 Number one, Levy is a drug case. Number two,
2 Levy apparently, the way I read this case, Levy had had
3 some prior brushes with the law with respect to drugs and
4 was aware of the DEA's posture with respect to cooperators
5 and, number three, at the time that Levy allegedly made
6 the statement that I will cooperate with you, he was in
7 fact under arrest and had in fact at that point made three
8 prior statements to agents or to an Assistant United
9 States Attorney.
10 THE COURT: So you think the fact that he was
11 under arrest helps your case?
12 MR. WALLENSTEIN: Well, I think the fact that
13 Levy was under arrest at that point in time.
14 THE COURT: I mean Levy was under arrest, if he
15 was under arrest, that helps you, you say?
16 MR. WALLENSTEIN: I don't know if it helps me or
17 hurts me. I think it is distinguishable and it makes the
18 facts of Levy substantially different from the facts we
19 have here.
20 The Second Circuit says that Levy's offer, having
21 been under arrest and having made three prior statements
22 now amounts to a consciousness of guilt and therefore they
23 allow it in. 24 The statement that, as I understand the notes 25 from Inspector Biegelman, and the proffer, the offer of
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7134 Jordan-cross/Trabulus
1 testimony from the government here, they want to elicit
2
from Agent Jordan that at the January meeting in
3 Mr. Reffsin's office at a time he clearly was not under
4 arrest, that Biegelman told him at that point in time
5 you're lying to us, get yourself a lawyer, and at that
6 point Reffsin allegedly said I'll tell you what you want
7 to know but I want immunity.
8 I don't think that that is consciousness of
9 guilt. Immunity has a specific meaning to us as
10 practitioners, it doesn't necessarily have the same
11 meaning to a layperson. It's a term that is heard, it's a
12 term that is thrown about. It is in the news a lot these
13 days with the President and Monica Lewinski and all of
14 that stuff but it is not necessarily a term that
15 laypersons will understand as we understand it and I don't
16 think that Mr. Reffsin saying I want immunity if you want
17 me to talk to you is the same as sitting down with an
18 attor
ney or myself or Mr. Dowling, my predecessor, or
19 anybody else sitting across of the table from Mr. White or
20 Ms. Scott "if you give me immunity I'll tender my client
21 to you. "
22 That's a whole lot different than a layperson in
23 his office being intimidated by Marty Biegelman saying 24 I'll not talk to you unless I get immunity. That's a real 25 difference and I think under the circumstances it is not
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7135 Jordan-cross/Trabulus
1 consciousness of guilt. It may very well be an invocation
2 of the right to counsel and is not consciousness of guilt
3 and should not be admitted for that purpose and that's the
4 only purpose to admit it.
5 MR. TRABULUS: Your Honor, may I add a couple
6 points since I objected there would be a tremendous
7 spillover with respect to Mr. Gordon.
8 His offer to
-- there was already testimony in
9 the case that he had confessed to purchasing heroin and
10 agreeing to sell it. It's a rather different type
11 situation. There was plenty of other evidence of
12 consciousness of guilt, but also there is another critical
13 distinction which appears at page 901. The Second Circuit
14 said, referring to his offer to cooperate, "here we deal
15 with admissions made not during the course of formal plea
16 bargaining but as part of an apparent effort by the
17 defendant to help himself," and now I emphasis "without
18 pausing to request any consideration whatsoever from the
19 prosecutor for his cooperation."
20 That's just the opposite.
21 THE COURT: Where do you see this now?
22 MR. TRABULUS: This is at page 901, the first
23 paragraph. The first paragraph after the quoted matter, 24 Your Honor. 25 THE COURT: I see it.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7136 Jordan-cross/Trabulus
1 MR. TRABULUS: Then they go on to say "plea
2 bargaining implies to have plead guilty upon condition.
3 The offer by the defendant must in some way express the
4 hope that a concession to reduce the punishment will come
5 to pass."
6 THE COURT: Where do you see that?
7 MR. TRABULUS: That's --
8 MR. WALLENSTEIN: Last complete paragraph.
9 MR. TRABULUS: The last complete paragraph on
10 that page, Your Honor.
11 THE COURT: Just one minute now. I see it.
12 MR. TRABULUS: What I'm getting at, Your Honor,
13 if Mr. Jordan's anticipated testimony on this is to be
14 accepted or Mr. Biegelman's notes is to be accepted, this
15 was not an unconditional offer to cooperate but a
16 conditional offer, I'll tell you more or I'll tell you
17 what you want to hear or
something like that if you give
18 me immunity, whether he meant use or transactional
19 immunity, it's not clear.
20 But it's certainly in the nature of a plea
21 bargain even if there were no formal charges against him
22 at that particular point. And clearly at that point with
23 him having been sworn to twice with Agent Biegelman 24 telling him I think you're lying, better get an attorney, 25 he's certainly on notice, he's likely to be a target or is
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7137 Jordan-cross/Trabulus
1 a target. I think that distinguishes this from the Levy
2 case completely, Your Honor.
3 MS. SCOTT: Your Honor, there was no offer to do
4 anything -- I mean, the only thing that was offered was to
5 give information. There is no offer to plead guilty on
6 the part of Mr. Reffsin. He wants an assurance that if he
7
says everything he knows he will not take any responsible
8 for any criminal activity. So this is not the same as a
9 plea negotiation to the degree that Rule 11 should cover
10 it or guard it from being revealed to the jury. It is his
11 first thought when he was challenged by Inspector
12 Biegelman about the truth of what he was saying to the
13 inspectors. The first thing that comes into his head is
14 that he needs to be protected from criminal prosecution
15 and he certainly doesn't offer to take any
16 responsibility. He just offers to say what he knows, just
17 to tell the truth.
18 THE COURT: Does -- is the proffered testimony to
19 the effect if he says something will he get immunity?
20 MS. SCOTT: Yes --
21 MR. WHITE: Your Honor, to be precise. The
22 proffered testimony is that after Inspector Biegelman told
23 him that he was lying and he should get an att
orney or 24 that Inspector Biegelman thought he was being untruthful 25 and should get an attorney, Mr. Reffsin said I'll tell you
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7138 Jordan-cross/Trabulus
1 everything if you give me immunity. I've done that
2 before.
3 It's an apparent reference to the fact that
4 previously Mr. Reffsin received immunity from our office
5 and testified in a grand jury in connection with another
6 case.
7 THE COURT: Well, first of all, I would
8 appreciate it, Mr. White, if you allow the lawyer who is
9 presenting it to conclude her presentation. She was doing
10 very well and it's disturbing that two lawyers get into
11 this act at one time. I think one at a time is
12 sufficient.
13 MR. WHITE: Your Honor, I'm sorry. I was more
14 familiar with the testimony because I was presenting the
15
witness.
16 MS. SCOTT: That's fine, Your Honor.
17 THE COURT: Do you want to add anything to that?
18 MS. SCOTT: Your Honor, I would point your
19 attention to language in Biaggi where the Court relies in
20 Wigmore, quotes a whole paragraph from Wigmore, that the
21 proposition is that it's the defendant's whole conduct
22 which is relevant in determining his state of mind.
23 Whether or not that whole conduct showed consciousness of 24 innocence or consciousness of guilt, all of the conduct 25 should come in to show his knowledge. And that, and in
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7139 Jordan-cross/Trabulus
1 addition, that this defendant, Mr. Reffsin, is not
2 distinguishable from Levy on the grounds that have been
3 cited by Mr. Wallenstein or by Mr. Trabulus. First of
4 all, as Mr. White has just told Your Honor the proffered
5 testimony would show that Mr. Reffsin had already entered
6 into an immunity agreement in this very courthouse and
7 knew about immunity and knew it could protect him and was
8 drawing on that experience in making this spontaneous
9 offer which again I submit is a clear indication of his
10 consciousness of guilt. He came right out and offered
11 this without even being asked for it.
12 MR. WALLENSTEIN: Judge, I have another problem
13 here. They are offering his request for immunity in this
14 case to indicate consciousness of guilt and they want to
15 back it up with his statement that he had received
16 immunity in the past which implies, of course, that he was
17 guilty of past criminal conduct. Not only is that not the
18 case, he was never charged with anything. There's never
19 been any indication that there was any past criminal
20 conduct.
21 He testifie
d as a government witness in the
22 Evangelista case and that's where he got immunity but he
23 was never charged with any conduct there and no one said 24 he committed any crimes in the contention of that case. 25 But the implication of this statement is that without
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7140 Jordan-cross/Trabulus
1 anything more specific, that he had previously been guilty
2 of a commission of a crime or crimes and had previous
3 times invoked his request for immunity in order to avoid
4 being prosecuted at a prior time and that is certainly
5 prejudicial and not based on fact.
6 MS. SCOTT: Your Honor, I will not present that
7 evidence. I offer it only to show Your Honor this
8 defendant is the same as Mr. Levy, certainly in that
9 respect, that he had experience with the law and he knew
10 about immunity. It's not an unc
ounselled offer.
11 MR. WALLENSTEIN: The only way they can offer
12 that he knew about the law and was aware what immunity
13 meant is to establish that he had received it in the past
14 by his own admission and that's the unduly prejudicial
15 part.
16 THE COURT: Okay. I heard the argument.
17 First of all, I like the quotation in Wigmore on
18 Evidence. I wonder when this was written. I think it was
19 before the criminal rules, the rules, the Federal Rules of
20 Evidence came into being, so I don't know how pertinent
21 that would be.
22 If I were writing an opinion like U.S. v. Biaggi
23 which is just a reverse of this situation where the 24 defendant wanted to put in the evidence that "I'll tell 25 you anything you want, I have nothing to hide." That's a
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7141 Jordan-cross/Trabulus
1 little bit different, and with all do respect to Dean
2 Wigmore it doesn't involve the Federal Rules and the more
3 recent decisions which is Levy.
4 Levy is probably the only case we've been able to
5 find in the Second Circuit on this subject and I have a
6 problem with the admissibility of this evidence based on
7 Levy. As Mr. Trabulus brought out, the problem is the
8 quid pro quo which reduces the spontaneous evidence of
9 guilt or consciousness of guilt.
10 Here's what the Court said in Levy. There was
11 testimony concerning offers by Levy to cooperate in the
12 future. Agents White, etcetera, each testified that Levy
13 had offered to cooperate with the DEA in future
14 investigations. We think that such an offer evidences a
15 consciousness of guilt and is relevant to prove the charge
16 against Levy.
17 Then they discuss Rule 11(e)(6) which is not
18 applicable, strictly applicable, and then there are two
19 further statements that condition the Levy case in a
20 manner in which in my view precludes this evidence as
21 Mr. Trabulus brought out: "Here we deal with admissions
22 made not during the course of formal plea bargaining but
23 as part of an apparent effort by the defendant to help 24 himself without pausing to request any consideration 25 whatever from the prosecutor for his cooperation."
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7142 Jordan-cross/Trabulus
1 And then further down in the opinion, "no fault
2 can be found with allowing in evidence his volunteered
3 desire to cooperate in the future since it was evidence of
4 his consciousness that he was in serious difficulty with
5 the law and needed to do something to extricate himself.
6 We glean nothing from Levy's various conversation
s that is
7 fairly discernible as an offer of a bargain nor were the
8 admissions that were made concurrently made with the offer
9 immunized from use since there is no offer to plead guilty
10 on condition that the charges or the possibility of
11 maximum punishment would be reduced."
12 That's not entirely clear and when it's not
13 entirely clear and it's an odd subject that I could find
14 very little on, I am careful, very careful. And here it
15 indicates that this is consciousness of guilt because it
16 came out without any deals in mind, without anything. He
17 said "I'm going to tell you all." Here there was a more
18 calculated, allegedly, a more calculated statement "give
19 me immunity and I'll talk to you." Now, that comes closer
20 to Rule 11(e). He's negotiating. And I'm not prepared to
21 extend the Levy rule to that kind of testimony which by
22 the g
overnment's own admission is what was said "give me
23 immunity." 24 Therefore I'm precluding the testimony. 25 What else do we have?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7143 Jordan-cross/Trabulus
1 Anything else?
2 MR. WALLENSTEIN: I think that's all in that
3 subject.
4 THE COURT: Okay. Let's bring in your jury. On
5 your second point you're in better shape, I mean Mr. White
6 is, that's the plea by Mr. -- By the deceased defendant.
7 MR. WHITE: Okay.
8 THE COURT: That one I think you're right.
9 MR. WHITE: I hope so.
10 THE COURT: Well, one out of two is better than
11 nothing, Mr. White.
12 MR. TRABULUS: Your Honor, we'd like to address
13 that at some point.
14 THE COURT: I'll give you an opportunity. You
15 might want to talk me out of that one also.
16 MR. WHITE: Then I'll be batting zero
.
17 THE COURT: Pardon?
18 MR. WHITE: Then I'll be batting zero.
19 THE COURT: Then you'll be batting zero. That's
20 right.
21 Is there -- there's a column for government,
22 there's a column for defendant, is there a column for
23 justice? What is the batting average of that column? I'm 24 just talking, you know, academically, that's all. 25 (Jury enters.)
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7144 Jordan-cross/Trabulus
1 THE COURT: Please be seated, members of the
2 jury. I'm sorry for keeping you waiting. A question of
3 law arose and I had to discuss it with counsel but we're
4 ready to proceed.
5 MR. TRABULUS: Thank you, Your Honor.
6 CROSS-EXAMINATION
7 BY MR. TRABULUS: (Continued.)
8 Q Mr. Jordan, I think right before the break I was
9 going to show you some of the collection information
1
0 statements or some of them.
11 Using my copy here I will show you Exhibit 406.
12 Do you recognize that as one of the clerk
13 information statements in this case?
14 A Yes.
15 Q And that's the one that was dated December 29, 1993?
16 A That's correct.
17 Q And you said that if I showed you the place where you
18 put in medical expenses you could tell whether or not you
19 were supposed to include only recurring ones?
20 A Just says list medical expenses.
21 Q Do you know whether the instructions say something
22 that modifies that?
23 A No, I don't. 24 Q I mean, you heard evidence in this case that certain 25 medical expenses paid on behalf of Mr. Gordon's wife,
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7145 Jordan-cross/Trabulus
1 whether it was said to be paid on behalf of Mr. Gordon's
2 wife wasn't listed there.
Do you remember that?
3 A I don't recall that.
4 Q In terms whether it should be listed there, do you
5 think it would make a difference if the instructions said
6 "show recurring medical expenses only. Do not include an
7 occasionally medical expense." Do you think that would
8 make a difference?
9 A Yes.
10 Q But you didn't look at the instructions to see
11 whether or not they say something like that, did you?
12 A No, I didn't.
13 Q Now, the government, the IRS and the United States
14 Government, they don't have the power to regulate how much
15 money people decide to spend on themselves, right? I
16 mean, it's not part of what the IRS does, right?
17 A I can't answer that.
18 Q I mean, the IRS can't go to somebody and say I only
19 want you to spend money on what you need. You're not
20 supposed to buy luxuries, right?
21 A I can't ans
wer that question.
22 Q You are not supposed to live beyond a certain
23 standard of living. Does the IRS do that? 24 A In some cases I think they might. 25 Q Well, does the IRS, I mean, if somebody spends more
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7146 Jordan-cross/Trabulus
1 than necessary living expenses but accurately lists their
2 necessary living expenses, have they done something
3 wrong?
4 MR. WHITE: Objection.
5 THE COURT: Overruled.
6 A I don't think I understand your question, sir.
7 Q Well, this same form, this Exhibit 406, it has a
8 column for necessary living expenses, right?
9 A Correct.
10 Q And there are some numbers listed there, right?
11 A Correct.
12 Q Now, forgetting about whether it had to be listed
13 there or not, if Mr. Gordon had spent on his living more
14 than what was necessa
ry, there wouldn't be anything wrong
15 with that? That wouldn't be a violation of any law, would
16 it?
17 A If he didn't put down his expenses on his form, it
18 might be.
19 Q Well, if the form just told him that he had to put
20 down what was necessary, but he spent more than what was
21 necessary, and he put more than what was necessary, do you
22 think that might be wrong?
23 A Can you say that again? 24 Q If he put down really more than what was necessary 25 and he put more than necessary, wouldn't that be untrue?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7147 Jordan-cross/Trabulus
1 A No.
2 Q If he said he needed $5,000 a month expenses to live
3 but he really could get by on 3,000 and put 5,000, would
4 that be untrue?
5 A I really can't answer that.
6 Q Can you conceive of a situation in which somebody can
7 fill out this form and make it untrue if they listed all
8 their expenses and treated them as necessary because some
9 of them were?
10 A If his expenses were more than what he said his
11 reported income was, yes.
12 Q Now, in terms of whether you should list all your
13 expenses or just your necessary expenses, something less
14 than that, the ones you need, would it make a difference
15 to you if the instructions say expenses must be reasonable
16 for the size of your family, geographic location and
17 unique circumstances? Would that make a difference from
18 you?
19 MR. WHITE: Objection. He's reading from a
20 document not in evidence.
21 THE COURT: He can read it and use it as a
22 question. Why not? So can you.
23 Overruled. 24 A What's the question, again, sir? 25 Q Well, the question--
OWEN M. WICKER, RPR OFFICIAL
COURT REPORTER 7148 Jordan-cross/Trabulus
1 THE COURT: As a matter of fact, some lawyers
2 read every question they ask. Do you know that,
3 Mr. White?
4 MR. WHITE: Your Honor, I'm saying he's reading
5 from a document not offered in evidence.
6 THE COURT: Well, it could be the racing form.
7 Who knows what it is.
8 MR. WHITE: Okay.
9 BY MR. TRABULUS:
10 Q Now, Mr. Jordan --
11 MR. TRABULUS: I have to define my point, Judge.
12 Q Mr. Jordan, in terms of whether or not somebody
13 filling out this form was supposed to list every penny
14 they spend or just what was necessary -- what they needed
15 to spend, do you think it would make a difference if the
16 instructions said, told people expenses must be reasonable
17 according to the size of your family, geographic location
18 and unique circumstance?
19 A No.
20
Q Wouldn't make a difference?
21 A No.
22 Q Well, the IRS doesn't have the power to tell people
23 to take whatever money they have available to them and 24 only spend what is reasonable for the size of their 25 family, geographic location and unique circumstances,
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7149 Jordan-cross/Trabulus
1 right?
2 A I can't answer that yes or no.
3 Q I mean, people are free to spend more than that,
4 aren't they?
5 A I can't answer that with a yes or no.
6 Q Now, Mr. Jordan, let's go back to your meeting with
7 Mr. Reffsin. I would like to go to the first one, the one
8 on May 17th.
9 Is it true, sir, that at that meeting Mr. Reffsin 10 told you and Inspector Biegelman that he had never been to
11 200 Hummingbird Lane?
12 A To the best that I recall, that's correct.
13 Q So Mr. R
effsin wasn't in any position to tell you
14 whether or not there was a home office there, whether he
15 had seen one.
16 A If he had not been there, he couldn't.
17 Q And he couldn't tell you whether or not there had
18 ever been any meetings or facilities set up for meetings
19 there, is that correct, sir, of his own knowledge?
20 A I can't answer that yes or no.
21 Q Now, you said that Mr. Reffsin said something to you
22 about discussions that he had had with the loans and how
23 they could be considered income. Do you recall testifying 24 to that? 25 A Not in those exact words.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7150 Jordan-cross/Trabulus
1 Q I can't use your exact words. I mean, I'm not a
2 tape-recorder, but something along those lines, right,
3 where you said he discussed with Mr. Gordon that the loans
4 could be
considered income?
5 A Potential income.
6 Q Potentially could be considered income, right.
7 I mean, he didn't tell you that he considered
8 them to be income, Mr. Reffsin, did he?
9 A He said that they could potentially be income.
10 Q He told you that he had discussed with Mr. Gordon
11 that there was a potential down the road, that the IRS
12 might challenge them in a civil proceeding, right?
13 A I can't answer that yes or no.
14 Q Did Mr. Reffsin tell you that it was cut and dry in
15 his mind that it was income? He didn't say that, did he?
16 A Cut and dry? No.
17 Q He said that he could see that the IRS might contend
18 that, potentially could do that, right?
19 A I can't answer that yes or no.
20 Q He didn't tell you that he thought the IRS would be
21 right? He didn't say that he thought the IRS would be
22 right, did he?
23 A He
didn't say either way. 24 Q Agent Jordan, is it fair to say that issues as to 25 whether or not something is income or not, these are
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7151 Jordan-cross/Trabulus
1 things that arise frequently between the IRS and the
2 taxpayers in a noncriminal context?
3 A Yes.
4 Q And there are many instances in which there can be an
5 argument both ways, is that fair to say?
6 A Yes.
7 Q And that there can be instances in which sometimes a
8 compromise is reached as between the taxpayer and the IRS?
9 A I don't understand the question.
10 Q Well, sometimes there would be a settlement as
11 between the taxpayer and the IRS?
12 A I still don't understand.
13 Q Well, sometimes the courts rule on these questions,
14 right?
15 A Civil cases.
16 Q Right.
17 Sometimes the IRS main
tains that something is
18 income and the taxpayer says it isn't in a civil case,
19 right?
20 A Yes.
21 Q And sometimes the IRS wins, right?
22 A Yes.
23 Q And sometimes the IRS loses, right? 24 A Yes. 25 Q And in a case in which the IRS loses, the person's
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7152 Jordan-cross/Trabulus
1 accountant might still have been considered beforehand
2 that the IRS might make that claim, right?
3 A I couldn't say yes or no.
4 Q Well, would it not be -- it would be common, would it
5 not, for an accountant to express concern that the IRS
6 might challenge something, even given down the road you
7 might win it?
8 A Yes.
9 Q Just one other thing.
10 I think you said Mr. Reffsin told you that
11 Mr. Gordon used the loan amounts to pay personal expenses,
12 right?
13 A To the best of my recollection, yes.
14 Q He didn't tell you that the corporation was
15 improperly writing off as business expenses the amounts
16 that it was being shown as loans to Mr. Gordon, did he?
17 A He said they were being charged as loans.
18 Q Well, charged as loans, not as a deduction, right?
19 A You don't deduct loans.
20 Q Right.
21 So in fact, he said nothing to remotely suggest
22 that the corporations were, with regard to those monies
23 that were charged as loans, nothing to suggest that the 24 corporation was improperly taking a deduction for any 25 personal expense to Mr. Gordon, right?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7153 Jordan-cross/Geduldig
1 A I can't answer that yes or no.
2 Q Did Mr. Reffsin -- withdrawn.
3 MR. TRABULUS: I have no further questions.
4 THE COURT: Anything else?
5 MR. GEDULDIG: I have just a couple questions,
6 Judge.
7 CROSS-EXAMINATION
8 BY MR. GEDULDIG:
9 Q Agent Jordan, I think you said that you had been
10 involved in this case almost from its inception; is that
11 right?
12 A I didn't say that.
13 Q Let me rephrase it.
14 You had been involved with this case certainly
15 from the point in time when arrests were made at Who's Who
16 Worldwide?
17 A That's correct.
18 Q And you've sat here during the entire course of this
19 trial?
20 A Is that a question?
21 Q Yes.
22 A Yes.
23 Q And you've seen a complaint that was drawn, the first 24 complaint that was drawn in this case as a result of the 25 arrests made at Who's Who Worldwide?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7154 Jordan-cross/Geduldig
1 A No.
2 Q You nev
er saw the complaint?
3 A Not to my recall, no, sir.
4 Q Let me show you and see if this refreshes your
5 recollection.
6 Showing you what has been marked 950493-M.
7 A I've never seen this before.
8 Q Have you seen the indictment before, before today?
9 A Which indictment, sir?
10 Q Well, the superseding indictment.
11 Let me show you superseding indictment number 1
12 (handing.)
13 A I may have seen parts of this but I don't know what
14 all the handwriting is on there.
15 Q I'm talking about the printed material, not the
16 handwritten material.
17 A I may have seen the parts that pertain to the tax
18 charges.
19 Q You've listened to the tape-recordings that have been
20 played during the course of this trial?
21 A Yes.
22 Q And you assisted Agent Pagano in preparing it so that
23 those tapes could be played in a prompt
and efficient way? 24 A I don't know -- I don't know what you're asking me. 25 Q Sometimes a tape would be put on, they would put the
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7155 Jordan-cross/Geduldig
1 switch button on and the tape would be at the very spot
2 where Mr. White or Ms. Scott wants it at.
3 A Did I assist in cuing them up is what you are asking
4 me?
5 Q Yes.
6 A No, I did not.
7 Q That was done by Agent Pagano?
8 A To the best of my recollection.
9 Q You have the indictment in front of you now?
10 A Yes, I do.
11 Q And you have what I referred to as the complaint now?
12 A Yes.
13 Q When you were sitting here, did you hear a tape
14 played of a recording by a women named Shelly Posner who
15 was an employee at Who's Who Worldwide and there was a
16 call made to Who's Who Worldwide, I believe,
by
17 Mr. Watstein and there was a reference to Shelly Posner
18 and she got on the phone and there was a tape played of
19 her speaking?
20 A I don't recall the name Shelly Posner.
21 Q Let me show you what has been marked 1315-A.
22 That's a transcript, is it not, of a
23 conversation, a recorded conversation? 24 A Yes, it is. 25 Q And one of the parties is Posner, Shelly Posner?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7156 Jordan-cross/Geduldig
1 A Yes, that's correct.
2 Q And she is an employee of Who's Who Worldwide?
3 A I don't know that.
4 Q Well, who is the other party speaking?
5 A Mr. Jacobs, I believe.
6 Q And Jacobs was the alias used by Mr. Watstein, was it
7 not?
8 A I'm not 100 percent sure, but --
9 Q May I see the transcript?
10 MR. GEDULDIG: If we can just read it together,
11 Judge.
12 THE COURT: Yes.
13 BY MR. GEDULDIG:
14 Q The very first attribution on page 1.
15 "Mr. Jacobs: I have one question for you that
16 brings up, Shelly, in terms of the selectivity of the
17 organization, and who might be conducting me.
18 "Posner: Yeah.
19 "Jacobs: : Of every 100 people, who, who applied,
20 how many do you accept?
21 "Posner: We have about 6,000. To give you a
22 ratio, about 6,000 requests for membership per month."
23 Do you see that? 24 A That's what is written here, yes. 25 Q Would that indicate that Posner was the employee at
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7157 Jordan-cross/Geduldig
1 Who's Who Worldwide and Jacob was the informant making the
2 call into Posner?
3 A Yes.
4 Q Am I not correct that Posner's name does not appear
5 on the indictment or in the
complaint?
6 A I have to look at it (perusing.)
7 Posner's name does not appear.
8 Q Now, let me show you what has been marked in evidence
9 as 1303, a conversation between a person named Davidson
10 and a person named Samuels.
11 Did you hear a conversation sitting here between
12 Alan Davidson, an employee of Who's Who Worldwide and an
13 undercover agent calling into the office to speak to
14 Mr. Davidson?
15 A I can't be certain, sir.
16 Q If you look at that transcript, does that refresh
17 your recollection that such a conversation did take place
18 and it was recorded?
19 A I'll have to read some of it.
20 Q Okay.
21 A (Perusing.)
22 What's your question now?
23 Q Does that transcript indicate that Alan Davidson was 24 an employee of Who's Who Worldwide, an informant from the 25 government called into Who's Who Worldwide and
got
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7158 Jordan-cross/Geduldig
1 Mr. Davidson on the telephone and spoke with him?
2 A I'm not sure whether Samuels was an informant of this
3 but I can see Davidson was an employee.
4 Q Of Who's Who Worldwide.
5 A It could be either one of the corporations.
6 Q Well, I'll tell you what. Whether it be Sterling or
7 Who's Who Worldwide, that is a conversation, if you glance
8 through it, in which Mr. Davidson, if I'm not mistaken,
9 Mr. Davidson says that whether it's Sterling or Who's Who,
10 that only 10 to 15 percent of the applicants are
11 accepted.
12 Do you see that in the conversation?
13 A Is it on the first page or the second page?
14 Q I'm not sure?
15 JUROR NO. 4: Second.
16 MR. GEDULDIG: Second page, as I understand it.
17 A Yes.
18 Q And that is what the
conversation is about, that they
19 accept 10 to 15 percent of the applicants?
20 A Yes.
21 Q And am I not correct in saying that Mr. Davidson, the
22 employee at Who's Who Worldwide, is not named in the
23 complaint or the indictment? 24 A I would have to look again, sir. 25 Q Fine.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7159 Jordan-cross/Geduldig
1 A (Perusing.) No Davidson.
2 Q His name is not up here; is that right?
3 A No, it is not.
4 Q I will show you now what has been marked, a
5 tape-recorded conversation marked 1310 in evidence.
6 Is that not a conversation between an employee of
7 Who's Who Worldwide named Linda May and either an
8 informant or somebody from the government calling into
9 Who's Who Worldwide and speaking with Ms. May?
10 A Yes.
11 Q And that's a conversation in 1310, transcript 13
10 in
12 which Ms. May also states that approximately 1,000 out of
13 6,000 applicants are accepted for membership in Who's Who
14 Worldwide; isn't that correct?
15 A Halfway down the first page, that is correct.
16 Q Let me also show you 13-43, a second conversation
17 between Ms. May and an informant working for the
18 government; is that right?
19 A Yes.
20 Q And Ms. May in that second conversation is stating to
21 the informant for the government while she is an employee
22 of Who's Who Worldwide, that mass mailings are not used;
23 isn't that right? 24 A (Perusing.) That's correct, three-quarters of the way 25 down the first page.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7160 Jordan-cross/Geduldig
1 Q Am I also correct in saying Ms. May is not listed as
2 a defendant in either the complaint or the indictment?
3 A
I'll look at it now (perusing.) There is no May
4 listed.
5 Q Let me show you what has been marked as 1319.
6 This is a recorded conversation, is it not
7 (handing)?
8 A It seems to be.
9 Q That was a recorded conversation that was played
10 during the course of this trial; am I right?
11 A I can't recall if it was played or not, sir.
12 Q Well, it has an identification number 1319, right?
13 A 1319, that's correct.
14 Q And the employee or the speaker at Who's Who
15 Worldwide is Brian Sherman?
16 A I can't tell where the person works, sir.
17 Q But his name is Sherman?
18 A That's correct.
19 Q And it bears a mark that that conversation, that
20 recorded conversation is in evidence in this case?
21 A It has a Government evidence sticker on it. I don't
22 know if it was received or not.
23 Q Okay. 24 That's a conversation
that reflects that out of 25 6,000 applicants only 1,000 are accepted for membership;
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7161 Jordan-cross/Geduldig
1 is that right?
2 A That's correct.
3 Q Can you tell me if anybody by the name of Sherman or
4 Brian Sherman had their name appear on the complaint or
5 the indictment in this case?
6 A I'm looking now (perusing.)
7 No one named Sherman appears here.
8 Q Let me show you what has been marked 1352.
9 That's a conversation, a recorded conversation
10 from this case; is that right?
11 A (Perusing.) It's a recorded conversation between
12 Dewitt and the CI.
13 Q And the confidential informant, that's what CI stands
14 for?
15 A Yes.
16 Q And that would indicate that he's either a government
17 informant or somebody working for the government in this
18
capacity?
19 A Yes.
20 Q And the informant is talking to Dewitt?
21 A Or Dewitt is talking to the informant.
22 Q In any event, they are having a conversation.
23 During that conversation, Dewitt, the employee at 24 Who's Who, says it is a membership-run organization, does 25 he not?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7162 Jordan-cross/Geduldig
1 A Yes, he does.
2 Q Can you tell me if Larry Dewitt was named in the
3 complaint or the indictment in this case?
4 A No Larry Dewitt is listed.
5 Q Let me show you what has been marked 1364 in
6 evidence.
7 That is a conversation that was recorded as a
8 result of the investigation in this case, right?
9 A (Perusing.) It's a recorded telephone conversation.
10 Q Okay.
11 And the employee at Who's Who Worldwide is an
12 individual name Greg Muller?
13 A Muller. It appears that Muller is the employee.
14 Q Okay.
15 And that's a conversation in which Muller tells
16 the informant or the government employee or the government
17 investigator that mailing lists are not used at Who's Who
18 Worldwide; is that right?
19 A That's correct.
20 Q Can you tell me if Greg Muller's name appears on the
21 complaint or the indictment in this case?
22 A No, his name does not appear.
23 Q Now, you were present when Alan Saffer was 24 testifying. Do you remember Alan Saffer? 25 A Not for his complete testimony, but yes.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7163 Jordan-cross/Geduldig
1 Q Do you have any recollection of Alan Saffer
2 testifying about a coworker of his at Who's Who Worldwide
3 who informed him of the use of codes on the information
4 cards, the coworkers name would
be Angela Palmer,
5 P-A-L-M-E-R?
6 A I can't tell you that.
7 Q Can you tell me if looking at the indictment or the
8 complaint in this case if Angela Palmer was ever charged
9 or indicted?
10 A I don't see the name Angela Palmer.
11 Q You heard the name Liz Sautter mentioned during the
12 course of this trial?
13 A Yes, I have.
14 Q Can you tell me if Liz Sautter's name appears on the
15 indictment or the complaint?
16 A No.
17 Q Were you present when Debbie Benjamin testified in
18 this case?
19 A Not for her whole testimony.
20 Q You saw her in the same chair as you are in right
21 now?
22 A Yes.
23 Q Can you tell me if Debbie Benjamin's name appears in 24 the complaint or the indictment in this case? 25 A No, it does not.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7164 Jordan-cross/Dun
n
1 Q Annette Haley's name appears in both the complaint
2 and indictment, does it not?
3 A Yes, it does.
4 MR. GEDULDIG: I have no other questions.
5 Nothing else, Judge.
6 CROSS-EXAMINATION
7 BY MR. DUNN:
8 Q Good afternoon, Agent Jordan.
9 A Good afternoon, Mr. Dunn.
10 Q Agent Jordan, how long have you been an agent with
11 the IRS?
12 A Since 1986.
13 Q Since that time how many statements have you taken
14 from people that were being arrested?
15 A I don't think I've ever taken a statement from
16 someone that I've placed under arrest.
17 Q You never took a statement?
18 A No.
19 Q You've never been present when statements were taken?
20 A With regard to an arrest?
21 Q Let me withdraw the question.
22 Have you taken statements from people since 1986
23 as part of your investigation? 24
A Do you mean regarding interviews and such? 25 Q Just regular oral and handwritten statements?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7165 Jordan-cross/Dunn
1 A Yes.
2 Q And how many?
3 A Over 25.
4 Q Over 25?
5 A Yes.
6 Q So since 1986 you've only taken 25 statements from
7 people?
8 A I said over 25.
9 Q Over 25.
10 Less than 100 though, apparently, correct?
11 A Yes.
12 Q And in those statements that you took, did you have
13 them sign?
14 A No.
15 Q You never had people sign statements?
16 A Not on notes that I take, no.
17 Q That wasn't the question.
18 On statements that people give you, do you have
19 them sign the statement?
20 A I don't understand what you mean by "statement" then,
21 sir.
22 Q Someone gives you some information. They're telling
23 you a story, they're telling you something. At the end if 24 you've been taking down notes or they put it down, you 25 don't have them sign it?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7166 Jordan-cross/Dunn
1 A If I take the notes, no.
2 Q Have you ever in your training ever been aware of the
3 fact that when statements are taken most of the time
4 people sign them?
5 A I can't answer that yes or no.
6 Q Now, how many times have you been present when
7 statements were given when another agent was taking notes
8 since 1986?
9 A I'd say numerous times.
10 Q Numerous times.
11 And what's numerous?
12 A About the same as my taking statements myself.
13 Q And do you particularly listen, I mean, do you
14 particularly recollect what -- these are cases that --
15 withdrawn.
16 These are cases that other people
are involved
17 in, other agents, correct?
18 A I can't answer that yes or no.
19 Q You said that, and correct me if I'm wrong, that you
20 first saw Mr. Rubin in Elmont, Queens, at between say
21 11:15 and 11:20 in the morning; is that correct?
22 A It was before lunch, yes.
23 Q And did you take any notes of this statement that 24 Mr. Rubin supposedly made in this vehicle, your vehicle? 25 Did you take any notes of those?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7167 Jordan-cross/Dunn
1 A No, sir.
2 Q Were you driving?
3 A Yes.
4 Q So you didn't take any notes; is that correct?
5 A No.
6 Q And you didn't review any notes that you took
7 obviously since you didn't take any, correct?
8 A I didn't take any notes so I couldn't review notes.
9 Q Did you review notes that Agent Biegelman took?
10 A Yes,
I did.
11 Q And that's the basis of your testimony today? Your
12 recollection -- it's not from your independent
13 recollection, it's your reviewing of Biegelman's notes,
14 correct?
15 A I have independent recollections of things that were
16 said.
17 Q Well, in Biegelman's notes, isn't it true that it is
18 stated that you were at Mr. Rubin's residence at about
19 11:20 a.m.?
20 A Approximately.
21 Q And after that you saw Mr. Rubin and you let him go
22 into his house to get some personal belongings, correct?
23 A We went with Mr. Rubin. 24 Q And to get some documents, correct? 25 A That's correct.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7168 Jordan-cross/Dunn
1 Q And after that you permitted Mr. Rubin to go to his
2 vehicle; is that right?
3 A We all went to his trunk, yes.
4 Q And he gave you
documents that were in his car; is
5 that right?
6 A He pointed out documents and we picked them up.
7 Q And would it be fair to say that the first time,
8 according to Mr. Biegelman, that Mr. Rubin was advised of
9 his rights to remain silent was 11:45 a.m.?
10 A The first time he was read his Miranda warnings was
11 11:45.
12 Q Now, are you aware that Mr. Rubin signed a consent to
13 search form on March 30th?
14 A Consent to search what, sir?
15 Q To search either his premises and/or an automobile?
16 A No, I don't recall.
17 Q You don't recall.
18 And you were with him when the car was opened,
19 correct, the trunk; is that right?
20 A Yes.
21 Q And it's your recollection that nothing was signed at
22 that point; is that right?
23 A To the best of my recollection, I don't recall that. 24 Q So let me just show you what has been
marked 25 Defendant's Exhibit AW entitled a Consent to Search form,
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7169 Jordan-cross/Dunn
1 and I would like to approach and just show it to you.
2 Now, is it fair to say that is a Consent to
3 Search form dated March 30th, and it has Steve Rubin's
4 name on it?
5 A That's what it says.
6 Q And is it fair to say it has Martin Biegelman's
7 signature?
8 A It has a signature that says Martin T. Biegelman.
9 Q Okay.
10 It doesn't have your signatures on there,
11 correct?
12 A No.
13 MR. DUNN: As part of a business record
14 maintained by the postal office I would like to introduce
15 this as Defendant's Exhibit AW.
16 THE COURT: Any objection?
17 MR. WHITE: No, Your Honor.
18 THE COURT: Defendant's Exhibit AW, Able William,
19 in evidence.
20
(Defendant's Exhibit AW received in evidence.)
21 MR. DUNN: And I would like to just publish it to
22 the jury, if that's all right with you, Your Honor.
23 THE COURT: Very well. 24 BY MR. DUNN: 25 Q Now, Agent Jordan, were you aware that there were
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7170 Jordan-cross/Dunn
1 handwriting samples taken from different people on March
2 30, 1995?
3 A No, I'm not.
4 Q Let me see if this refreshes your recollection, and
5 it has been marked for Identification as AZ, Defendant's
6 Exhibit AZ.
7 (Handing.)
8 A I've never seen that.
9 Q Would it be fair to say that it has the name at one
10 point of Steve Rubin, 6 John Avenue, Elmont, New York?
11 A That's what it appears to be.
12 Q March 30, 1995?
13 A Yes.
14 MR. DUNN: Again, as a business record of the
15 U
.S. Postal Service I would like to move in Defendant's
16 Exhibit AZ.
17 THE COURT: Any objection?
18 MR. WHITE: Your Honor, there is no such
19 foundation, but I don't object.
20 THE COURT: Very well.
21 Defendant's Exhibit AZ, Able Zebra, in evidence.
22 (Defendant's Exhibit AZ received in evidence.)
23 MR. DUNN: I'll publish it to the jury, Your 24 Honor. 25 THE COURT: Yes.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7171 Jordan-cross/Dunn
1 BY MR. DUNN:
2 Q You testified, I believe, that after you left Elmont,
3 New York, with Mr. Rubin, the vehicle that you were
4 driving went to the Lake Success location of Who's Who
5 Worldwide; is that correct?
6 A That's correct.
7 Q And do you know if Mr. Rubin was taken into Who's Who
8 Worldwide at that point or was he left in the vehicle?
9 A I don't unders
tand what you mean.
10 Q Well, you drove to the Lake Success location, you,
11 Agent Biegelman and Mr. Rubin, correct?
12 A That's correct.
13 Q And when you got to the Lake Success location of
14 Who's Who Worldwide, did everybody exit the vehicle?
15 A No, only Inspector Biegelman.
16 Q And you remained in the vehicle with Mr. Rubin; is
17 that correct?
18 A That's correct.
19 Q I would like to show you what's been marked as
20 Defendant's Exhibit AV.
21 THE COURT: That's for Identification?
22 MR. DUNN: Yes, Your Honor, for now, for
23 Identification, yes. 24 THE COURT: Are those IRS instructions? 25 MR. DUNN: No, Your Honor.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7172 Jordan-cross/Dunn
1 THE COURT: Previously there has been an exhibit
2 marked for Identification AV, I believe.
3 MR. DUNN: Then
I'll change this, Your Honor.
4 Your Honor, there are a couple other things
5 marked but I would like to have this marked BA, if it is
6 all right with the Court.
7 MR. SCHOER: No.
8 THE COURT: I suggest you make a master list of
9 all these exhibits because we'll try to give them to the
10 jury at the end of the case, a list. You better start
11 making.
12 MR. DUNN: I'll change that to DA, Your Honor.
13 THE COURT: Very well.
14 BY MR. DUNN:
15 Q I ask you to take a look at this, Agent Jordan.
16 Is it fair to say that that has the name Steve
17 Rubin on it?
18 A I've never seen it before, but it has Steve Rubin
19 over there (indicating.)
20 MR. DUNN: This is a United States postal
21 inspection warning and waiver of rights, Your Honor, and I
22 would like to, under the business record rule, move it
23 into evidence. 24 T
HE COURT: Any objection? 25 MR. WHITE: Again, Your Honor, there is no
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7173 Jordan-cross/Dunn
1 business records foundation but I don't object.
2 THE COURT: Very well.
3 Defendant's Exhibit DA, Dog Able, in evidence.
4 (Defendant's Exhibit DA received in evidence.)
5 BY MR. DUNN:
6 Q I would like you to take a look at Dog Able -- I mean
7 DA, I'm sorry, and is it fair to say that where it has
8 United States Postal Inspection Service warning and waiver
9 of rights, and it has date, March 30, 1995, time 11:45
10 a.m.; is that correct?
11 A That's correct.
12 Q And further down it has the rights, for example, you
13 have the right to remain silent, correct?
14 A Yes.
15 Q And it has some other rights. And then it goes
16 down. "I have read this statement of the rights. This
17 statement of my rights has been read to me and I
18 understand what rights they are."
19 Is that a fair reading?
20 A Yes.
21 Q And it states March 30th, and does it say 1:06 p.m.?
22 A (Perusing.) Yes, it does.
23 Q And it has a signature that seems to be Steve Rubin, 24 correct? 25 A That's tough for me to read, sir.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7174 Jordan-cross/Dunn
1 Q Does it at least read or seem to be Steve to you?
2 A Not really. I'm sorry.
3 Q That's okay.
4 It also has further down underneath some
5 signatures it has a waiver, right, and it says "I'm
6 willing to discuss subject presented and answer
7 questions. I do not want a lawyer at this time. I
8 understand and know what I'm doing. No promises and
9 threats have been made to me and no pressure or coercion
10 has been made of
any kind has been used against me."
11 Is that a fair reading?
12 A That's what it says.
13 Q Is there a date or signature underneath that waiver?
14 A Two witnessed by signatures.
15 Q The question is is there a signature, date or time in
16 reference to the waiver?
17 A There are two signatures in reference to the waiver.
18 Q Two witnessed by?
19 A Yes.
20 Q Based on your experience, tell me what was witnessed
21 in reference to the waiver? What could have been
22 witnessed in reference to the waiver?
23 A I can't answer that. 24 Q Now, let me ask you this. If there is something 25 handwritten into any government document or statement,
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7175 Jordan-cross/Dunn
1 isn't it fair to say that normally someone would initial
2 any kind of addition or change in something?
3
A Not necessarily.
4 Q Not necessarily.
5 So if something is handwritten in, for example,
6 orally advised Steve Rubin of his rights and understood
7 it, how are we supposed to know when that was put into
8 this document or if anyone approved it?
9 A At the date that it says there, 3/30/95.
10 Q What about this one on the bottom? "He agreed to
11 talk with us," it looks like. Where is the time to figure
12 out when that was put in?
13 A The same date.
14 MR. DUNN: I would like to have this published to
15 the jury, Your Honor.
16 THE COURT: Yes.
17 BY MR. DUNN:
18 Q Were you aware that some of the defendants in this
19 case were given the equivalent of affidavits to sign about
20 what they did at Who's Who Worldwide and that they signed
21 them?
22 A I'm not aware of that, sir.
23 Q Now, apparently Mr. Rubin was given something,
24 handwriting things to sign, he was given a consent to 25 search to sign and he was given a Miranda warning form to
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7176 Jordan-cross/Dunn
1 sign based on the documents you saw. Would that be fair
2 to say?
3 A That's correct.
4 Q But nowhere was he given anything to sign about any
5 statement, about the substance of any statement. He was
6 not given anything to sign about that; is that correct?
7 A That's correct.
8 Q How long was Mr. Rubin with you out at Who's Who
9 Worldwide before you left to go to Brooklyn?
10 A I didn't go to Brooklyn.
11 Q How long was he with you before the vehicle he was in
12 left to go to Brooklyn?
13 A In my vehicle? I didn't go back to Brooklyn, sir.
14 Q All right.
15 The question is, how long was Mr. Rubin in your
16 vehicle after he got
to Who's Who Worldwide?
17 At some point he had to be taken out, correct?
18 A That's correct.
19 Q How long was he in the vehicle?
20 A Five, maybe ten minutes.
21 Q Now, one of those documents shows a signing of 1:06
22 p.m.; is that correct?
23 A That's correct. 24 Q You first saw Mr. Rubin around 11:20 a.m., correct? 25 A Correct.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7177 Jordan-cross/Dunn
1 Q Based on your experience, not that you went, but
2 based on your experience, how long would it take if
3 someone went directly from Lake Success to the Brooklyn
4 courthouse?
5 A On Cadman Plaza?
6 Q Right.
7 A About an hour.
8 Q So you first see him at 11:20. He signs a Miranda
9 warning at 1:06. Even assuming that's when he left to go
10 to Brooklyn, 2:06 is -- from 11:15 to 2:15 is three hours,
11 correct?
12 A Yeah.
13 Q He signed a Consent to Search form during that time.
14 He signed a page full of handwriting exemplars and he
15 signed a form stating that he has been advised of his
16 rights, correct?
17 A Correct.
18 Q But at no time during those three hours did he sign
19 any notes that Agent Biegelman took; is that correct?
20 A Not from what I can see.
21 Q He never said look, this is what you told us before,
22 we've typed it out for you, we just want you to sign that,
23 nothing like that? 24 A Not to my knowledge. 25 Q But he's handed all these other documents to sign; is
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7178 Jordan-cross/Dunn
1 that correct?
2 A That's the way it would appear.
3 Q When you are in the car with Agent Biegelman, he
4 wasn't taking any notes at that time on the
ride back to
5 Lake Success; is that correct?
6 A I was driving, I did not see him.
7 Q You heard, you were here for part of the time when
8 the cooperating witness, Ihlenfeldt I think was his name,
9 was testifying?
10 A For part of the time, yes.
11 Q Were you here when he said that he had met with Agent
12 Biegelman and Agent Biegelman gave him suggestions on
13 certain questions to ask employees of Who's Who Worldwide
14 and Sterling Who's Who on the phone? Were you here for
15 that?
16 A I can't be certain if I recall that, sir. I don't
17 doubt you but I can't be certain.
18 Q Do you recall if Agent Biegelman was asking questions
19 of Mr. Rubin while you were driving?
20 A Yes.
21 Q Is it your testimony that Agent Biegelman asked
22 Mr. Rubin something like this "look, you knew there were
23 mailing lists, right?" And Rubin said "yes.
" Is that fair 24 to say? 25 A I don't think the question went like that. I don't
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7179 Jordan-cross/Dunn
1 think so.
2 Q You don't have any independent recollection, correct?
3 A Yes, I do.
4 Q Well, you needed Biegelman's statement to review in
5 order to testify today, correct?
6 A To refresh my recollection, yes.
7 Q It's your recollection that Mr. Rubin said that I
8 told people I was there for more than the period of time I
9 was there for. Is that your testimony?
10 A That's my recollection, yes.
11 Q And Mr. Rubin told you he was there for a year; is
12 that correct?
13 A That's what Mr. Rubin said.
14 Q Would it surprise you -- withdrawn.
15 Isn't it a fact that during the ride back to Lake
16 Success from Mr. Rubin's home that Agent Biegelman and
17 M
r. Rubin were basically in a debate of sorts about
18 whether Who's Who Worldwide was really a good product or
19 not?
20 A I don't recall that.
21 Q Were you present during the testimony of Alan Saffer?
22 A For parts of it, yes.
23 Q Do you recall Alan Saffer stating that Steve Rubin 24 totally believed in Who's Who Worldwide? 25 A I can't be certain if Mr. Saffer said that.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7180 Jordan-cross/Dunn
1 Q But you've heard testimony like that during this
2 case?
3 A I believe I have.
4 Q Isn't it a fact when you and Agent Biegelman first
5 approached Mr. Rubin outside of his house and you told him
6 he was under arrest, he thought it was a joke?
7 A No.
8 Q Didn't he tell you, come on, my friends put you up to
9 this? You don't recall anything like that?
10 A No, sir.
11 Q And of course you would not have taken notes at that
12 point; is that correct?
13 A No, sir.
14 Q Did Agent Biegelman have his big book of notes out
15 while you were outside of Mr. Rubin's house?
16 A I don't believe so, no.
17 Q As I sit there now, you've basically testified about
18 something concerning some notes allegedly that Agent
19 Biegelman took down; is that correct?
20 A I can't answer that yes or no.
21 Q As you sit there now, you have no idea, do you, when
22 Agent Biegelman made any notes in reference to any
23 conversation he did or did not have with Steve Rubin, 24 correct? 25 A I did not see Inspector Biegelman taking notes when
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7181 Jordan-cross/Dunn
1 we were standing outside his house and I did not see
2 Inspector Biegelman taking notes while I was drivi
ng,
3 because I was driving.
4 Q You have no idea.
5 It could have been a month or two months after
6 the arrest when Agent Biegelman decided to memorialize any
7 kind of statement that he claimed and you claimed
8 Mr. Rubin made; isn't that correct?
9 A I can't answer that with a yes or no.
10 Q Because you don't know, correct?
11 A I can't answer that with a yes or no.
12 Q You don't know when Agent Biegelman made these notes,
13 correct?
14 A I didn't see him take them, if that's what you're
15 asking me.
16 Q Do you have any independent recollection whether
17 Mr. Rubin said anything like "I may have told some people
18 that there was a conference at Hilton Head"? Do you have
19 any independent recollection of that statement?
20 A The word "may have," no.
21 Q Do you have some independent recollection whether he
22 said "I told
people there were conferences at Hilton
23 Head"? 24 A Yes. 25 Q And do you have any independent recollection as you
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7182 Jordan-cross/Wallenstein
1 sit there now that he also stated, if he stated this, "but
2 I was told later that it never happened"?
3 A No.
4 Q Never mentioned anything about Debra Benjamin telling
5 him before Christmas Eve that Hilton Head never happened?
6 A I don't recall that.
7 MR. DUNN: May I just have a moment, Your Honor?
8 THE COURT: Yes.
9 MR. DUNN: I have no further questions, Your
10 Honor.
11 CROSS-EXAMINATION
12 BY MR. WALLENSTEIN:
13 Q Good afternoon, Agent Jordan.
14 A Good afternoon, Mr. Wallenstein.
15 Q Agent Jordan, the notes that Inspector Biegelman made
16 with respect to the interviews of Mr. Reffsin, were you
17 present when he made those notes?
18 A Yes.
19 Q And those are the notes that you indicated you used
20 to refresh your recollection of the conversation with
21 Mr. Reffsin, correct?
22 A That's correct.
23 Q And those notes contain Inspector Biegelman's 24 recollections of what Mr. Reffsin said, correct? 25 A I can't answer that yes or no.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7183 Jordan-cross/Wallenstein
1 Q Well, you read them, right?
2 A Yes.
3 Q And in fact, you read them over the weekend, this
4 past weekend, correct?
5 A Yes.
6 Q And did he make them contemporaneously with the
7 interview of Mr. Reffsin?
8 A To the best of my recollection, yes.
9 Q So that when -- withdrawn.
10 There are two sets of notes you used, correct,
11 one from the May '95 interview and one from the January of
12 '96 interview?
13 A That I used?
14 Q That you used to refresh your recollection.
15 A Those are, as far as I know, the only two sets of
16 notes that exist with respect to these interviews, that's
17 correct. To the best of my recollection, yes.
18 Q You didn't make any notes yourself?
19 A No.
20 Q And it's your recollection that Inspector Biegelman
21 as you sat in Mr. Reffsin's office was writing things down
22 and those are the notes that we're talking about, correct?
23 A I have a recollection that Mr. -- Inspector Biegelman 24 was writing things down. 25 Q Do you know whether those are the notes or whether he
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7184 Jordan-cross/Wallenstein
1 then transcribed them later on?
2 A I can't answer that yes or no.
3 Q When for the first time did you read them?
4 A Qu
ite awhile ago.
5 Q At any time at or about the time of the interviews,
6 and let me be more specific, in May of '95, I and
7 Mr. Biegelman go to Reffsin's office and interview him?
8 A That's correct.
9 Q That's the first time you had any contact with Marty
10 Reffsin?
11 A To the best of my recollection, yes.
12 Q And at that point in time when you're sitting in his
13 office and you indicated that that interview took
14 approximately an hour --
15 A Approximately.
16 Q -- Biegelman's writing while both of you are
17 questioning Reffsin and Reffsin is answering your
18 questions, right?
19 A That's fair, yes.
20 Q Would it also be fair, by the way, to say that
21 Mr. Reffsin was cooperating?
22 A He was answering the questions.
23 Q Okay. 24 And do you know whether the notes that you used 25 this past weekend to refresh y
our recollection and
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7185 Jordan-cross/Wallenstein
1 specifically --
2 MR. WALLENSTEIN: Judge, may I have one moment?
3 THE COURT: Sure.
4 MR. WALLENSTEIN: Judge, bear with me. We just
5 want to get an exhibit number so we can identify this for
6 the record.
7 THE COURT: Yes.
8 BY MR. WALLENSTEIN:
9 Q Agent Jordan, I'll show you what has been marked as
10 Government's Exhibit 3500-16-F, for Frank.
11 A (Perusing.)
12 Q Would it be fair to say that those appear to be a
13 copy of Inspector Biegelman's notes of the May 1995
14 meeting?
15 A Except that there is some highlighting on them.
16 Q Right, which was done by Mr. Trabulus, frankly.
17 Those were not on them when you saw them last; is that
18 correct?
19 A That's correct.
20 Q Other than the high
lighting and any marginal notes
21 that my appear on the pages, the photocopying itself is an
22 accurate reflection of Inspector Biegelman's notes that
23 you used to refresh your recollection; is that correct? 24 A That's correct. 25 Q And I'll show you also what has been marked as
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7186 Jordan-cross/Wallenstein
1 3500-16-G, for George, which was stapled together until I
2 just pulled the staple out.
3 Would it be fair to say that that exhibit is
4 Inspector Biegelman's notes from the January 1996
5 interview of Mr. Reffsin?
6 A That's correct.
7 Q And do you know, and I'm referring now to Exhibit
8 17-F, do you know whether those notes are the ones that
9 Inspector Biegelman made at the time of the interview or
10 whether he later transcribed his interview notes and
11 created what we
now have as Exhibit 16-F?
12 A I don't know that.
13 Q Okay.
14 Same question with respect to 16-G. Do you know
15 whether those are his notes or whether he transcribed his
16 notes and later created this exhibit?
17 A I don't know.
18 Q Would it be fair to say while you yourself kept no
19 notes of the interviews, you did keep a diary and made
20 entries with respect to the interviews in the diary?
21 A Yes.
22 Q Would it also be fair to say that that diary contains
23 really nothing more than dates, times, places and names 24 and no substantive information beyond that? 25 A That's correct.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7187 Jordan-cross/Wallenstein
1 Q Do you have a recollection as you sit here now of the
2 date on which the interview of Mr. Reffsin occurred in May
3 of 1995?
4 A I believe it is
May 16th.
5 Q And your diary from May 16th reflects that that is
6 the day you interviewed Mr. Reffsin; is that correct?
7 A May I see it to give you an accurate answer?
8 Q Absolutely.
9 I'll show you Exhibit 3500-16-C which is your
10 diary for 1995 or excerpts from it, correct?
11 A Yes.
12 Q And that reflects an entry for Tuesday, May 16th of
13 an interview with Mr. Reffsin, correct?
14 A That's correct.
15 Q And would you look at 3500 16-F which are Inspector
16 Biegelman's notes of the interview with Mr. Reffsin, and
17 they reflect the date of May 17th; is that correct?
18 A Yes.
19 Q Which one is accurate?
20 A I would have to say Inspector Biegelman's notes are
21 correct.
22 Q Well, did you maintain your diary on a daily basis?
23 A Yes. 24 Q And did you make your entries in the diary at the end 25 of the busine
ss day before the start of the next business
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7188 Jordan-cross/Wallenstein
1 day?
2 A Not in all cases, no.
3 Q Do you have a recollection of when you put in the
4 interview of Mr. Reffsin on the May 16th page?
5 A It would have to be within a few days.
6 Q But not necessarily the same day?
7 A No, not necessarily.
8 Q So one of you is right?
9 A That's correct.
10 Q It's possible that the one who is right is you, is
11 it?
12 A I can't answer that yes or no.
13 Q Well, it is possible that the interview was actually
14 on May 16th and Inspector Biegelman made an error when he
15 wrote down May 17th, correct?
16 A I wouldn't make that error.
17 Q Therefore, when you wrote it on the 16th, you were
18 right and he was the one that was wrong?
19 A That's not what
I'm saying.
20 Q You are saying that it is more likely that you made
21 the error in putting the diary entry in than he made the
22 error on putting his date on the interview notes?
23 A That's correct. 24 Q But you don't know that for a fact? 25 A I don't know it either way.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7189 Jordan-cross/Wallenstein
1 Q So it's possible that he's wrong?
2 A And it's possible that he's right also.
3 Q When for the first time did you speak with Maria
4 Gaspar?
5 A I can't recall the first time.
6 Q Do you recall approximately the month, the year?
7 A It could have been in 1995.
8 Q Do you know what time of the year it was, what month
9 it was?
10 A No, I don't.
11 Q You were here when she testified, correct?
12 A That's correct.
13 Q You were one of the men in suits with b
adges that she
14 referred to; is that correct?
15 A That's correct, the first meeting.
16 Q The first meeting you had with her was at the
17 Huntington Townhouse; is that correct?
18 A I can't be certain. If you can show me the notes of
19 the interview, I'll be certain.
20 Q We'll get to that.
21 You heard her testify, though, that the first
22 time that she met anyone from the government was when the
23 men in suits with badges came in the Huntington Townhouse 24 to talk to her; is that correct? 25 Do you recall that she said that?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7190 Jordan-cross/Wallenstein
1 A About the men in the suits and the badges?
2 Q Yes.
3 A Yes.
4 Q And that was at the Huntington Townhouse?
5 A To the best of my recollection, yes.
6 Q And the second meeting that she talked about was at
7 the Hicksville Post Office, I presume, at the inspector's
8 office, correct?
9 A I can't be certain when the second meeting was.
10 Q Is it fair to say you met with her four times?
11 A I think so, yes.
12 Q And she testified with respect to four meetings, two
13 at the Townhouse, one at the inspector's office and I
14 think the fourth was at the U.S. Attorney's Office; is
15 that correct?
16 A I'm not certain what she testified to, sir.
17 Q The first three were interviews without counsel
18 present and the fourth was when Mr. Nicolosi had become
19 involved; is that correct?
20 A I don't believe I was there for one of those
21 meetings.
22 Q So you were there for three out of the four?
23 A To the best of my recollection, yes. 24 Q Do you know which one you weren't? 25 A I'm not certain. It might be the one at the post
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7191 Jordan-cross/Wallenstein
1 office.
2 Q The two meetings at the Townhouse lasted how long
3 each, if you recall?
4 A The second meeting at the Townhouse was over an hour.
5 Q And the first one?
6 A I can't be certain.
7 Q When for the first time did the subject of the logs
8 come up with Maria Gaspar?
9 A In my presence?
10 Q Sure.
11 A I believe it was at the second meeting at the
12 Townhouse.
13 Q Which would be the third meeting overall, according
14 to her testimony, correct?
15 A Yes.
16 Q Who brought up the subject of the logs, Ms. Gaspar or
17 one of the agents?
18 A I can't answer that yes or no.
19 Q That wasn't a yes or no question.
20 A Okay.
21 Q That was a "who brought it up"?
22 A It's my understanding that the logs were brought up
23 with Ms. Gaspar in the second meeting at the post office. 24 Q Okay.
25 A Which I was not present for.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7192 Jordan-cross/Wallenstein
1 Q Do you know from discussions with Ms. Gaspar at the
2 third meeting or at any other time or from discussions
3 with other agents or from reading the paperwork in the
4 case who brought up the subject of the logs in the first
5 place?
6 A I can't be certain.
7 Q Before the first meeting with Ms. Gaspar, were you
8 aware of the existence of the logs?
9 A I was not, no.
10 Q Do you know whether anyone on the government team
11 was?
12 A I never heard of the logs.
13 Q When for the first time did you personally hear about
14 the logs?
15 A It was sometime after the meeting in the post office
16 at the one I was not at.
17 Q And before the second meeting at the Townhouse?
18 A That's correct.
19 Q And from whom did you hear it?
20 A From Inspector Biegelman.
21 Q And do you know where he heard it?
22 A I understood that he heard it from Ms. Gaspar.
23 Q So would it be fair to say then that it's your 24 understanding that the subject of the logs was first 25 broached by Maria Gaspar at the second meeting at the post
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7193 Jordan-cross/Wallenstein
1 office to Inspector Biegelman?
2 A I can't answer that. I don't know.
3 Q Inspector Biegelman, correct?
4 A I don't know what he knows.
5 Q The subject did not come up at the first meeting; is
6 that right?
7 A You show me the notes so I can be absolutely
8 positive.
9 Q I haven't got them in front of me. But your
10 recollection of the fir
st meeting is that the subject of
11 the notes was not brought up at that meeting,
correct?
12 A That's correct.
13 Q And your recollection is that you personally heard
14 about the logs for the first time from Inspector Biegelman
15 after the Hicksville meeting that you did not attend?
16 A That's correct.
17 Q And at that time when Inspector Biegelman mentioned
18 the logs, he told you that Maria Gaspar brought them up
19 during the course of the meeting, correct?
20 A I don't recall whether he said that or not.
21 Q Do you know who else was at that second meeting?
22 A Maybe Mr. White.
23 Q Okay. 24 Anybody from the IRS? 25 A Not to my knowledge.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7194 Jordan-cross/Wallenstein
1 Q When for the first time did you see the logs or a
2 copy of the logs?
3 A Sometime in b
etween the second and third meeting.
4 Q And you got the copy from Inspector Biegelman?
5 A That would be the only place I would have gotten it
6 from.
7 Q Do you have a recollection of when you got it or
8 them, they were in the condition in which they were
9 introduced into evidence here, that is, with
10 Mr. Ackerman's cover sheets and so on?
11 A I can't be certain.
12 Q Did you just see the actual pages of the logs?
13 A I recall seeing the actual pages but I'm not certain
14 about the cover sheets when I first saw them.
15 Q Do you know where Inspector Biegelman got them?
16 A No.
17 Q You were part of the government team that executed
18 search warrants in 1983 at Marcus Avenue; is that correct?
19 A That's correct.
20 Q And there were a few documents taken from there?
21 A More than a few, sir.
22 Q Okay.
23 Roughly how many
? 24 A Maybe a truckload. 25 Q A big truck?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7195 Jordan-cross/Wallenstein
1 A A large truck.
2 Q Were those logs a part of that document seizure, if
3 you know?
4 A I don't know.
5 Q Were the logs turned over as part of the production
6 of documents by Mr. Reffsin subject to the grand jury
7 subpoena?
8 A I don't know.
9 MR. WALLENSTEIN: Would this be a good point to
10 take a break, Judge?
11 THE COURT: All right.
12 Members of the jury, we'll take a ten-minute
13 recess.
14 Please do not discuss the case. Keep an open
15 mind.
16 (Jury exits.)
17 (Recess taken.)
18 (Jury enters.)
19 THE COURT: Please be seated, members of the
20 jury.
21 You may proceed, Mr. Wallenstein.
22 MR. WALLENSTEIN: Thank you, Your Honor.
23 BY MR. WALLENSTEIN: 24 Q Agent Jordan -- 25 MR. JENKS: Your Honor, before he begins I'll get
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7196 Jordan-cross/Wallenstein
1 Mr. Schoer.
2 THE COURT: I'm sorry.
3 You may proceed.
4 MR. WALLENSTEIN: Thank you, Your Honor.
5 BY MR. WALLENSTEIN:
6 Q Agent Jordan, do you know when the subject of the
7 logs was first raised with Mr. Reffsin? Was it in the
8 first interview or the second?
9 A The second interview.
10 Q That would be in January of 1996?
11 A That's correct.
12 Q And would it be fair to say that that was because you
13 didn't know about the logs during the May interview in
14 1995?
15 A That's correct.
16 Q So that you learned of the existence and the
17 purported problems with the logs sometime between May of
18 1995 and January
of 1996, correct?
19 A That's correct.
20 Q And that would be from Maria Gaspar, as you said
21 earlier, correct?
22 A That would be from Inspector Biegelman.
23 Q Who learned it from Maria Gaspar? 24 A Yes. 25 Q And at the second interview in January of 1996, you
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7197 Jordan-cross/Wallenstein
1 and Inspector Biegelman questioned Mr. Reffsin with
2 respect to the logs; is that right?
3 A That's correct.
4 Q And it would be fair to say that Mr. Gordon had been
5 the one to show him the logs initially?
6 A He said other things about the logs, but he did say
7 that.
8 Q I'm aware of that. Let's take my questions one at a
9 time.
10 He also said that -- he told you, he being
11 Reffsin, told you that he, Reffsin, had told Bruce Gordon
12 that the logs contained i
nadequate or incomplete
13 information, correct?
14 A That's correct.
15 Q And did he describe what he felt the inadequacy was?
16 A To my recollection, no.
17 Q Did he tell you -- withdrawn.
18 Did he describe what the logs looked like when he
19 first saw them?
20 A No, he didn't.
21 Q Did he tell you that in fact the logs, when he first
22 saw them, when Mr. Gordon showed them to him, contained
23 nothing more than a date and a name? 24 A I can't give you a yes or no for that. 25 Q Do you recall them saying anything to that effect?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7198 Jordan-cross/Wallenstein
1 A I can't give you a yes or no.
2 Q It's possible they did say that?
3 A I can't give you a yes or no.
4 Q Mr. Reffsin told you that he told Gordon that the
5 logs needed to be redone, that they weren't up
to what the
6 bankruptcy court ordered, correct?
7 A I can't answer that.
8 Q Well, did Mr. Reffsin tell you that he had told Bruce
9 Gordon that the logs needed to be redone?
10 A Yes.
11 Q Did he tell you that they needed to be redone in
12 order to put more information in them?
13 A That's correct.
14 Q And he also told you that he did not see the logs
15 after they were redone, correct?
16 A That's correct.
17 Q He did not at any time tell you that he had provided
18 the information from which the logs were to be created,
19 correct?
20 A I don't understand your question.
21 Q Let me try again.
22 You were present when Maria Gaspar -- were you
23 present when Maria Gaspar testified that she was 24 instructed to create the logs by Mr. Gordon and by 25 Mr. Reffsin?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
7199 Jordan-cross/Wallenstein
1 A I recall that, yes.
2 Q Did Mr. Reffsin at any time during the interview on
3 January 19, 1996, indicate to you that he had provided any
4 information to Ms. Gaspar?
5 A No, he did not.
6 Q The loans that were on the books of Who's Who
7 Worldwide as loans to Bruce Gordon, you discussed those
8 with Mr. Reffsin, correct?
9 A That's correct.
10 Q Would it be a fair statement, by the way, that the
11 function of an accountant is not to be an advocate for the
12 Internal Revenue Service?
13 A I can't answer that with a yes or no.
14 Q Would it be a fair statement that the function of an
15 accountant is, in addition to the obvious doing of the
16 calculations and booking of entries, would be to tell his
17 client an interpretation of the laws as they pertain to
18 tax returns and so on?
19 A Am
ong other things, yes.
20 Q And would it be a fair statement that there are
21 things in the Internal Revenue Code that are gray areas?
22 A Yes.
23 Q And there are any number of occasions where an 24 accountant on behalf of the taxpayer will take one view of 25 a particular deduction or an entry or something and the
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7200 Jordan-cross/Wallenstein
1 IRS will take an opposite view, is that a fair statement?
2 A Yes.
3 Q And as Mr. Trabulus said earlier, sometimes the
4 taxpayer, sometimes the IRS wins; is that correct?
5 A Correct.
6 Q And in fact, would it be a fair statement that there
7 are times when the taxpayer can even persuade the IRS to
8 see the error of their ways, if you will?
9 A I can't answer that yes or no.
10 Q There are times when a taxpayer will go in with a
11
negotiation with the IRS and the IRS will change its
12 position after the negotiation, correct?
13 A I can't answer that yes or no.
14 Q Now, you are a Special Agent, correct?
15 A That's correct.
16 Q Mr. Rosenblatt is a Revenue Agent, correct?
17 A That's correct.
18 Q And those are different functions; is that right?
19 A That's correct.
20 Q And Mr. Rosenblatt said that his function involved
21 the computation and collection of taxes and so on. Your
22 function on the other hand is criminal investigation,
23 correct? 24 A That's correct. 25 Q And all of the Special Agents from CID are involved
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7201 Jordan-cross/Wallenstein
1 in the criminal end of the tax code; is that correct?
2 A That's correct.
3 Q Besides Special Agents and Revenue Agents, are there
4 regular
agents or does everybody have that same title?
5 A Yes.
6 Q There came a point in time in the January 1996
7 meeting when Inspector Biegelman -- withdrawn.
8 Agent Jordan, you are familiar with the exhibits
9 and documents introduced here in the tax portion of the
10 case?
11 A Yes.
12 Q And specifically are you familiar with Government's
13 Exhibit 420 and all of its lettered attachments, that is
14 the Offer and Compromise?
15 A Yes.
16 Q Let me show you Government's Exhibit 420, the Offer
17 and Compromise. Would it be fair to say, by the way, that
18 an Offer and Compromise is just that, it's an offer?
19 A That's correct.
20 Q And it is part of a negotiation between the taxpayer
21 and the Internal Revenue Service to compromise a past
22 liability to the IRS?
23 A Between the taxpayer -- 24 Q And the service? 25 A And
his representative and the service, yes.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7202 Jordan-cross/Wallenstein
1 Q The taxpayer on one side whoever he has assisting
2 him, an attorney, accountant or taxpayer, whatever, and
3 the Service on the other side?
4 A Yes.
5 Q And the purpose of that is in plain English as the
6 title of the document infers, it's an offer to compromise
7 a past liability; is that correct?
8 A That's correct.
9 Q And it's basically an offer by a taxpayer to pay less
10 than what the IRS claimants is owed, correct?
11 A I can't answer that yes or no.
12 Q Let me ask you a question. Have you ever had a case
13 where the taxpayer offered to pay more than what the IRS
14 wanted?
15 A No.
16 Q And if they were going to pay exactly what the IRS
17 wanted they wouldn't need to make an offer to compr
omise,
18 or they might if they wanted to make a payment
19 arrangement?
20 A No, you lost me.
21 Q I lost myself too.
22 The purpose of the Offer and Compromise is for a
23 taxpayer to go to the IRS and say look, I know I owe you a 24 substantial amount of money. I can't afford it. I'm 25 going to pay you less. I'll give you X number of dollars
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7203 Jordan-cross/Wallenstein
1 over X period of time which is less than what I owe you
2 but it's really less than I can afford. Will you take it?
3 Is that in a nutshell what an Offer and Compromise is?
4 A Yes.
5 Q In this case Mr. Gordon owed the Internal Revenue
6 Service approximately 3.5 million?
7 A Yes.
8 Q And a part of that 3.5 million dollars tax liability
9 was an amount of money owed to the Department of Justice
1
0 as a result of an agreement with the Department of
11 Justice, correct?
12 A Let me just check. (Perusing.)
13 Q Sure.
14 A Correct.
15 Q And would it be fair to say that the Department of
16 Justice portion of that Offer and Compromise was
17 approximately $254,000?
18 A Correct.
19 Q The Offer and Compromise submitted here is an offer
20 to pay $150,000 in satisfaction of Mr. Gordon's
21 liabilities to the IRS, correct?
22 A In satisfaction of the 3.5 million, yes.
23 Q And would it be a fair statement that that's the 24 opening shot? If they don't want to take it they don't 25 have to take it and they can negotiate it further,
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7204 Jordan-cross/Wallenstein
1 correct?
2 A I don't know about the negotiating part, but they
3 don't have to take it.
4 Q I mean
, the IRS has a couple options. When the offer
5 to compromise the tax liability is made in the amount of
6 $150,000, the IRS can say fine, we accept the offer, we
7 sign the documents, he pays the bill and everybody is
8 happy, that's option one?
9 A That's not simple, but yes.
10 Q And option two is the IRS can say not in a hundred
11 years can we take this offer, it's not enough, we think
12 you have more and so on. We reject your offer, that's
13 option two; is that correct?
14 A Yes.
15 Q Option three, look, it's not really enough, but why
16 don't you come in and sit down and we'll talk about it and
17 then it goes from there, correct?
18 A Yes.
19 Q And would it be a fair statement that in general it's
20 the function of an accountant acting on behalf of a
21 taxpayer to minimize to the extent that he can the
22 taxpayer's liability to the IRS
?
23 A Yes. 24 Q And in line with that function, would it be a fair 25 statement that the accountant then has the right to come
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7205 Jordan-cross/Wallenstein
1 in and say, look, these are some numbers, this is what we
2 think we can afford, this is why we think we can afford to
3 do it and offer the IRS two cents or ten cents on the
4 dollar, 30 cents on the dollar, whatever is appropriate
5 under the circumstances?
6 A Yes.
7 Q And the IRS then has the options we just spoke about;
8 is that correct?
9 A That's correct.
10 Q And in this case part of the Offer and Compromise
11 which you have in front of you, Exhibit 420 and its
12 alphabetical attachments, part of that was a projection of
13 Mr. Gordon's income over the period from 1991 through
14 1996, correct?
15 A I
t wasn't all the projection. Part of it was, yes.
16 Q Take a look specifically at Exhibit 420-E, for Echo.
17 A Yes.
18 Q That is a projection of Mr. Gordon's income, correct?
19 A Again, it's not all a projection.
20 Q No, that's correct, the 1991 figures are actual.
21 '92 through '96 are projected?
22 A Correct.
23 Q And would it be fair to say as you read that schedule 24 that what's included in that projection of income and 25 expenses is payment to the Department of Justice in
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7206 Jordan-cross/Wallenstein
1 connection with that $254,000 liability that we just spoke
2 of?
3 A That's correct.
4 Q And it indicates under note C that there is an
5 agreement with the Department of Justice and that assuming
6 the income is as projected, he will pay as agreed with the
7 DOJ tho
se particular sums of money, correct?
8 A Yes.
9 Q And so it would be fair to say in addition to the
10 $150,000 that was offering in the Offer and Compromise, he
11 was also going to be paying the Department of Justice the
12 $254,000 liability that was owed to them?
13 A I can't answer that.
14 Q Well, does it appear to be that from this schedule
15 where he includes a payment to DOJ based upon the
16 agreement?
17 A I can't answer that yes or no.
18 Q Okay.
19 How long before the January '96 meeting with
20 Mr. Reffsin did you learn of the logs from Inspector
21 Biegelman and Maria Gaspar?
22 A I don't know how long it was.
23 Q Some months, perhaps? 24 A I don't think it was that long. 25 Q Well, at the time when you had the meeting with
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7207 Jordan-cross/Wallenstein
1 Mr. Reffsin in January of '96, had you had all four
2 meetings with Maria Gaspar and if not how many did you
3 have?
4 A Could you ask me one at a time? One question at a
5 time.
6 Q At the time in January of 1996 when you interviewed
7 Mr. Reffsin, you had already had a number of meetings with
8 Maria Gaspar, correct?
9 A No.
10 Q You met with Maria Gaspar for the first time after
11 you met with Mr. Reffsin?
12 A I met with Maria Gaspar before I met with
13 Mr. Reffsin.
14 Q Right, that was my question.
15 A You said a number of. I'm sorry.
16 Q Well, one is a number.
17 How many meetings did you have with Maria Gaspar
18 prior to the January '96 interview of Mr. Reffsin?
19 A I had one meeting.
20 Q How many did Inspector Biegelman have, if you know?
21 A To my recollection, one.
22 Q So the second meeting
with Maria Gaspar where the
23 subject of the logs was first raised came after the 24 meeting with Mr. Reffsin? 25 A I believe it was after it, yes.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7208 Jordan-cross/Wallenstein
1 Q So you're saying that at the time you interviewed
2 Mr. Reffsin in January of '96, that's the second interview
3 with Mr. Reffsin, that you had no knowledge of the logs at
4 that point in time?
5 A No, that's not correct.
6 Q At the first meeting with Mr. Reffsin in May of '95,
7 you had no knowledge of the logs?
8 A That's correct.
9 Q At the second meeting you already knew about them
10 from Gaspar?
11 A From Inspector Biegelman.
12 Q From Inspector Biegelman.
13 A That's correct.
14 Q So let me focus my question then. The second
15 interview with Marty, in January of '96, how many times
16 had you and/or Inspector Biegelman met with Maria Gaspar
17 prior to the second interview with Marty Reffsin?
18 A Once with myself and once with Inspector Biegelman
19 and somebody else.
20 Q So the second meeting with -- the second meeting you
21 had with Gaspar which would be the second one at the
22 Townhouse came after the second interview with Reffsin?
23 A I'm totally confused by your question. 24 Q If you are and I am, they are, so let's try again. 25 When was the first meeting with Maria Gaspar,
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7209 Jordan-cross/Wallenstein
1 that would be the first one at the Townhouse, the men with
2 suits and badges?
3 A Correct. When was it?
4 Q What point in time?
5 A I think it was in '95.
6 Q Before or after the first interview with Mr. Reffsin 7 which was before or after '
95?
8 A I don't recall that.
9 Q At the first interview with Reffsin you did not know
10 about the logs?
11 A That's correct.
12 Q At the second interview with Reffsin you did know
13 about the logs?
14 A Correct.
15 Q And in between the two interviews of Reffsin there
16 was at least one meeting with Maria Gaspar where Inspector
17 Biegelman was present and you were not, correct?
18 A To the best of my recollection, yes.
19 Q That's when Biegelman learned about the logs from
20 Maria Gaspar and subsequently told you about it?
21 A To the best of my recollection, yes.
22 Q Did the second meeting with Gaspar at the Townhouse
23 take place before or after the second interview of 24 Reffsin? 25 A I believe it was after.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7210 Jordan-cross/Neville
1 Q Okay.
2 MR. WALLENSTEIN: I have no further questions.
3 Thank you, Agent Jordan.
4 THE COURT: Anything else?
5 CROSS-EXAMINATION
6 BY MR. NEVILLE:
7 Q Good afternoon.
8 A Good afternoon, Mr. Neville.
9 Q You took Steve Rubin with Marty Biegelman over to the
10 post office the day he was arrested?
11 A No.
12 Q You took him somewhere, didn't you?
13 A Yes.
14 Q To the courthouse?
15 A No.
16 Q Where did you take him?
17 A I took them to 1983 Marcus Avenue.
18 Q As far as you know, Marty Biegelman was the lead
19 agent or inspector in this case, the mail fraud
20 investigation of Who's Who, right?
21 A To the best of my knowledge, yes.
22 Q And the date that you went over and arrested Steve
23 Rubin supposedly with Marty Biegelman was the same day 24 that the search warrant was executed at Who's Who in 25 Marcus
Avenue?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7211 Jordan-cross/Neville
1 A That's correct.
2 Q There were some anywhere from 20 to 75 agents and
3 inspectors and law enforcement people executing the search
4 warrant on Who's Who?
5 A That's correct.
6 Q Now, it's your testimony that you and Marty Biegelman
7 drove down to Elmont with Liz Sautter in the car?
8 A That's correct.
9 Q To find Steve Rubin.
10 A For her to point out where Mr. Rubin lived.
11 Q This is the same Liz Sautter that is not in the
12 courtroom but that has been talked about in the trial?
13 A That's correct.
14 Q The same Liz Sautter that was running the
15 administrative office at Who's Who?
16 A I'm not certain of what her function was.
17 Q You're sitting here at this trial because your major
18 role in the case had to do with the
tax end of the things
19 involving Mr. Gordon, right?
20 A That was one of my roles, yes.
21 Q One of your roles was to be here at the trial and
22 assist Mr. White in presenting the tax case, right?
23 A That's correct. 24 Q So, I saw you were bringing in some of the charts 25 that were blown up to show to the jury in regards to the
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7212 Jordan-cross/Neville
1 tax case, right?
2 A That's correct.
3 Q How much did you have to do with the investigation of
4 Scott Michaelson or Steve Rubin or any of the other
5 salespeople or anybody else at Who's Who with regards to
6 the alleged conspiracy to commit mail fraud?
7 A Very little.
8 Q So you're here now testifying about the arrest of one
9 of the salespeople at Who's Who Worldwide even though you
10 had very little to do with the
investigation of Who's Who
11 Worldwide and the alleged mail fraud conspiracy, right?
12 A I can't answer that yes or no.
13 Q Not that you can't, you won't, right?
14 A No, I can't, sir.
15 Q Did you have anything to do with Steve Watstein and
16 those tapes that he made?
17 A No.
18 Q Did you have anything to do with that other guy,
19 Ihlenfeldt, was that his name, and the tapes he made?
20 A No, I had nothing to do with him.
21 Q Did you sit down with Inspector Biegelman and decide
22 what questions Ihlenfeldt and Watstein should ask when
23 they called up Who's Who Worldwide? 24 A No, I did not. 25 Q Did you have anything to do with the litigation that
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7213 Jordan-cross/Neville
1 Reed Elsevier had against Who's Who Worldwide?
2 A No, I did not.
3 Q Did you attend
any of those proceedings that Reed
4 Elsevier brought against Who's Who Worldwide?
5 A To the best of my recall, no.
6 Q Do you remember if you were in court during any of
7 the bankruptcy proceedings between Reed Elsevier and
8 Mr. Gordon's company?
9 A I don't believe I was.
10 Q You're not sure though?
11 A I wasn't.
12 Q So you are certain that you weren't, right?
13 A To the best of my recollection, yes.
14 Q Now, when Mr. Trabulus was asking you questions about
15 the tax case, do you remember when he asked you questions
16 about the instructions on a form that the IRS puts out
17 about how to prepare collection information statements?
18 Do you remember him asking you those questions?
19 A Yes.
20 Q Now, you're a Special Agent with the IRS in regards
21 to criminal investigations, right?
22 A That's correct.
23 Q Serious inv
estigations, right? 24 A That's correct. 25 Q In fact, so serious that the IRS brings some
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7214 Jordan-cross/Neville
1 investigations where they decide that criminal charges
2 should be brought against someone and possibly be sent to
3 jail, right?
4 A That's not entirely correct.
5 Q Well, could I be sent to jail for some civil IRS
6 proceeding?
7 A No.
8 Q I would have to pay the money if I lost a civil IRS
9 proceeding, right?
10 A That's correct.
11 Q But if I lost a criminal IRS proceeding potentially,
12 I could go to jail, right?
13 MR. WHITE: Objection.
14 THE COURT: Sustained.
15 BY MR. NEVILLE:
16 Q Correct me if I'm wrong, but when Mr. Trabulus asked
17 you about this instruction sheet, you as a Special Agent
18 in the criminal investigatio
n division of the IRS had
19 never read that form?
20 A I had never seen that form before.
21 Q You have never seen a form that the IRS puts out to
22 let taxpayers read to see how the heck to fill out one of
23 your forms? 24 A That form I've never seen. 25 MR. NEVILLE: Now I know why I'm in trouble when
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7215 Jordan-cross/Neville
1 I try to do my taxes.
2 MR. WHITE: Objection.
3 THE COURT: Well, that was Mr. Neville's quote
4 for the day. He has now exhausted all his chances. So no
5 more, Mr. Neville. We're giving you that one.
6 I didn't mind that one myself.
7 MR. NEVILLE: You can identify with that. I can
8 see that.
9 BY MR. NEVILLE:
10 Q Now, when Mr. Dunn was up here asking you questions
11 about the alleged statement that Mr. Rubin made, you know
12 w
hy I say alleged, right --
13 A No, sir.
14 Q Well, you're alleging that Steve Rubin made a
15 statement in your presence with Marty Biegelman, right?
16 A I heard the statement, yes.
17 Q And you are alleging here in court. You are
18 testifying to it, right?
19 A I'm testifying to it, that is correct.
20 Q Now, you're the guy that didn't have much to do with
21 this investigation as against Who's Who Worldwide?
22 A That's correct.
23 Q And you were the guy driving the car as Marty 24 Biegelman was taking this alleged statement from Steve 25 Rubin, right?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7216 Jordan-cross/Neville
1 A That's correct.
2 Q You were driving, right? You were following traffic
3 lights and leading the right of way to people who had it
4 over you and all those things that we do when we drive,
5 right?
6 A That's correct.
7 Q Do you have a radio in that car that you were
8 driving?
9 A What kind of a radio?
10 Q One of your IRS radios where you speak with other IRS
11 agents?
12 A There was a two-way radio.
13 Q Was it on?
14 A It was broken.
15 Q Are you sure we balanced the budget?
16 A I can't answer that.
17 THE COURT: One more strike and you're out. I
18 mean out as far as extra statements are concerned. You
19 are certainly in this every other way, of course.
20 BY MR. NEVILLE:
21 Q Now, Mr. Dunn showed you a Consent to Search form
22 that was Defendant's Exhibit AW, that Mr. Rubin or someone
23 with the first name Steve signed. 24 A Can I see it again? 25 Q Sure.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7217 Jordan-cross/Neville
1 I think it's in evidence, isn'
t it? (Handing.)
2 A Yes, that's what Mr. Dunn showed me.
3 Q Up at the top of that page it says "I, Steve Rubin."
4 A That's correct.
5 Q And this is where Steve Rubin is writing down that he
6 consents to have his home and his car searched by you and
7 Marty Biegelman, right?
8 A I'm not certain who wrote this down.
9 Q Well, what does it say on there? Who says "I,"
10 what's in that blank?
11 A Steve Rubin.
12 Q Is it unreasonable for me to say that Steve Rubin is
13 the one that signed that document? Will you dispute that?
14 A Signed it or filled it out, sir?
15 Q Either one.
16 A As far as signing it, I don't know what Mr. Rubin's
17 signature looks like so I can't say anything about that.
18 Q Were you present when Steven Rubin gave his
19 handwriting exemplars to the United States Postal
20 Inspection Service?
21 A No.
22 Q And how about the waiver of -- warning and waiver of
23 rights form that Mr. Rubin signed the first part of, the 24 warning part. Do you remember that form that Mr. Dunn 25 showed you?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7218 Jordan-cross/Neville
1 A Yes.
2 Q And at the bottom of that form there is a waiver and
3 even though there are people who signed it who witnessed,
4 there is no signature for Steve Rubin waiving his rights,
5 is there?
6 A That's correct.
7 Q And you heard virtually all the testimony that has
8 come through this trial, all the witnesses, right?
9 A I've been present for it, yes.
10 Q You remember more than a handful of government
11 witnesses saying that Steve Rubin was one of the most
12 dedicated, passionate people who worked the job?
13 A I don't remember him saying.
14 Q Steven
Rudin -- Rubin.
15 A I remember somebody.
16 Q Alan Saffer saying something along those lines about
17 Steven Rubin?
18 A I can't be certain.
19 Q You're driving this car with Marty Biegelman and
20 Steve Rubin in it and you're saying that Steve Rubin made
21 these statements about all of these different things that
22 were going on at Who's Who?
23 A That's correct. 24 Q And Marty Biegelman -- withdrawn. 25 You were driving. Was Marty Biegelman sitting
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7219 Jordan-cross/Neville
1 next to you in the front seat?
2 A Inspector Biegelman was in the back.
3 Q Excuse me. Inspector Marty Biegelman, he was in the
4 back with Steve Rubin?
5 A Mr. Rubin was sitting in the front.
6 Q With you?
7 A In the passenger seat.
8 Q And where was Liz Sautter at this point?
9 A I don't know.
10 Q Well, what happened? Did she just get out in Elmont
11 and walk off into the sunset?
12 A No, a female postal inspector followed us in her
13 vehicle and after Ms. Sautter pointed out Mr. Rubin's
14 house, we let her go into that car.
15 Q Any idea why either you or Marty Biegelman didn't
16 have Steve Rubin write out these answers to these
17 questions that he supposedly gave and signed off on them?
18 A No.
19 Q Now, this conversation or these statements, alleged
20 statements that Steve Rubin made supposedly happened
21 almost three years ago now, right?
22 A That's correct.
23 Q And in order for you to testify today before this 24 jury about these alleged statements of Steve Rubin, you 25 refreshed your recollection not with your own notes but
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7220 Jordan-cross
/Neville
1 with Marty Biegelman's notes, right?
2 A That's correct.
3 Q You didn't take notes.
4 A Is that a question?
5 Q Right.
6 A That's correct.
7 Q And nonetheless, we have at least three documents
8 signed by Steve Rubin regarding this case, correct?
9 A That's correct.
10 Q We have a consent to search his house and car, right?
11 A I'm just reading it (perusing.) That's correct.
12 Q By the way, where are the documents that Mr. Rubin
13 gave over to you and Marty Biegelman on that day?
14 A Inspector Biegelman took them and I don't know where
15 they are.
16 Q Did you look at them?
17 A No.
18 Q Any idea what they were?
19 A No.
20 Q Any idea why Mr. Rubin gave them to you?
21 A Yes, I do have an idea.
22 Q But you don't know where they are?
23 A No. 24 Q After Liz Sautter drove off i
n that other car, 25 whatever happened to her?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7221 Jordan-cross/Neville
1 A I don't know.
2 Q Did you help make any of the decisions as to who to
3 prosecute in this case and who not to prosecute?
4 A With regard to what charges, sir?
5 Q Well, you're testifying in regard to Steve Rubin's
6 alleged statements about the mail fraud conspiracy.
7 Did you help Ron White make any decisions on
8 whether or not to charge somebody like Liz Sautter who
9 worked in the administration office?
10 A No, I did not.
11 Q Because you didn't have anything to do with the Who's
12 Who mail fraud case, did you? You just had something to
13 do with the tax case, right?
14 A That's correct.
15 Q Even though you never read that instruction form in
16 the case, you still were concentrating on that pa
rt of the
17 case, not the mail fraud part, right?
18 A That's correct.
19 Q You also have a form there that Steve Rubin signed to
20 show his handwriting, to show what his handwriting looked
21 like so Marty Biegelman could do further investigations,
22 right?
23 A That's correct. 24 Q And then we also have the form that he signed where 25 he said that he was given his rights even though he didn't
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7222 Jordan-cross/Neville
1 sign off on actually waiving his rights, right?
2 A That's correct.
3 Q But we don't have -- but we don't have, do we, a
4 signed statement by Steve Rubin as to what you've
5 testified you claimed he said on that day, right?
6 A That's correct.
7 Q What happened? Did the IRS pen run out of ink?
8 MR. WHITE: Objection.
9 THE COURT: Sustained.
10 BY MR. NEVILLE:
11 Q If Steve Rubin was so cooperative, giving these
12 documents, signing all of these forms, how come Marty
13 Biegelman didn't show you the form that he supposedly
14 signed adopting those statements that you are testifying
15 to?
16 MR. WHITE: Objection.
17 THE COURT: Sustained.
18 BY MR. NEVILLE:
19 Q Because there is no such document, right?
20 A I don't know what you're talking about, sir.
21 Q There is no such written statement signed by Steve
22 Rubin to the effect of what you told this jury today Steve
23 Rubin supposedly said on the date of his arrest? 24 MR. WHITE: Objection. 25 THE COURT: Sustained. Desist.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7223 Jordan-cross/Neville
1 BY MR. NEVILLE:
2 Q Now, once you and Marty Biegelman and Liz Sautter
3 went over to Steve Rubin's h
ouse there and arrested him,
4 did you go anywhere else and arrest any other person that
5 had to do with this case at their house?
6 A No, I did not.
7 Q Was Steve Rubin the only person that you know of that
8 you participated in the arrest of at his home?
9 A That's a three-part question. If you want yes or no
10 answers, you have to give me one at a time.
11 Q Anybody else, as far as you know, arrested at their
12 home?
13 A I don't know.
14 Q Anyone else arrested at their home by you?
15 A Besides Steve Rubin, no.
16 Q Now, do you know that every one of the defendants
17 including Scott Michaelson signed the advice of rights
18 form? Do you know that?
19 A No, I don't know that.
20 Q Do you know that every one of the people in this case
21 signed that same form that talks about the Miranda
22 warnings and whether they've been apprised of
their
23 rights, to remain silent, etcetera? 24 A I don't know that. 25 Q Are you aware of the fact there are some instances in
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7224 Jordan-cross/Neville
1 this case where defendants have signed off on written
2 statements?
3 A I don't know that.
4 Q How come you are testifying to this and not Marty
5 Biegelman?
6 MR. WHITE: Objection.
7 THE COURT: Sustained.
8 BY MR. NEVILLE:
9 Q Do you know where Marty being is?
10 MR. WHITE: Objection.
11 THE COURT: Overruled.
12 A I think he's in California.
13 Q Why did you have to refresh your recollection as to
14 what Steve Rubin allegedly said on that day virtually
15 three years ago by reading Marty Biegelman's notes about
16 that incident?
17 MR. WHITE: Objection.
18 THE COURT: Sustained.
19 BY MR. NEVILLE:
20 Q That's what you had to do, right, remind yourself by
21 reading his notes?
22 MR. WHITE: Objection.
23 THE COURT: Sustained. 24 BY MR. NEVILLE: 25 Q Let me ask you this. If you had come here today and
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7225 Jordan-cross/Neville
1 testified without looking at Marty Biegelman's notes, will
2 you tell this jury that you would have remembered what you
3 think Steve Rubin said that day?
4 MR. WHITE: Objection.
5 THE COURT: Sustained.
6 Q No idea what happened to Liz Sautter?
7 A No.
8 Q In your investigations, your criminal investigations
9 in the alleged IRS crimes, does the IRS have the address
10 of people in its data bank?
11 A Could you ask me that question again?
12 Q Well, let's say you want to arrest me for an alleged
13 IRS crime. C
ould you look up my name in the computer and
14 find out where I live?
15 A There would be an address.
16 Q Any idea whether the people at the administrative
17 office at Who's Who Worldwide knew where Steve Rubin
18 lived? Somebody like Liz Sautter, for example?
19 MR. WHITE: Objection.
20 THE COURT: Sustained
21 BY MR. NEVILLE:
22 Q Did you look up in your IRS computer for the address
23 of Steve Rubin? 24 A No, I did not. 25 Q So you're testifying that you took a ride with Liz
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7226 Jordan-cross/Neville
1 Sautter who is the administrative whatever at Who's Who to
2 have her tell you where Steve Rubin lived?
3 A That's correct.
4 Q How about Debra Benjamin, did you have any
5 discussions with her about where Steve Rubin lived?
6 A Not to my recollection.
7 Q
You remember what Steve Rubin allegedly said almost
8 three years ago. Do you remember if you talked to Debra
9 Benjamin about Steve Rubin's address?
10 A To the best of my recollection, no.
11 Q How come you don't say "to the best of my
12 recollection" when Mr. White asks you questions?
13 MR. WHITE: Objection.
14 THE COURT: Sustained.
15 BY MR. NEVILLE:
16 Q Any statements by Scott Michaelson?
17 A I've never met Mr. Michaelson.
18 Q Aside from what has been played in court here, did
19 you listen to any of the tapes in this case prior to the
20 trial?
21 A No, I have not.
22 Q And your testimony is that after Liz Sautter gave you
23 directions to Elmont, you drove down and picked up Steve 24 Rubin after speaking to his landlady, right? 25 A That's correct.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7227 Jordan-c
ross/Neville
1 Q What was the landlady's name?
2 A I don't believe we asked her.
3 Q You didn't ask her name?
4 A No.
5 Q How did you know she was a landlady?
6 A Because she said she was.
7 Q Well, what was her name?
8 A I don't know.
9 Q Well, how the heck do you remember what Steve Rubin
10 supposedly said without looking at Marty Biegelman's
11 notes?
12 A Because I remember.
13 Q What did the landlady look like?
14 A A woman in her 40s.
15 Q Oh, that's a good description. We can go right out
16 and find her on that, couldn't we?
17 MR. WHITE: Objection.
18 THE COURT: Sustained.
19 Q Was she tall, short?
20 MR. WHITE: Objection.
21 THE COURT: Sustained.
22 Q What color was the house?
23 MR. WHITE: Objection. 24 THE COURT: Sustained. Desist. 25 BY MR. NEVILLE:
O
WEN M. WICKER, RPR OFFICIAL COURT REPORTER 7228 Jordan-cross/Neville
1 Q Isn't it odd that you have written statements for
2 other people that you had signed waivers by Steve Rubin
3 but for an alleged statement that Steve Rubin made, not
4 even to you but to Marty Biegelman, there's nothing except
5 you referring to Marty Biegelman's notes?
6 MR. WHITE: Objection.
7 Q Isn't that interesting?
8 THE COURT: Sustained.
9 MR. NEVILLE: No further questions.
10 THE COURT: Anyone else?
11 Any redirect?
12 MR. WHITE: Yes, Your Honor.
13 (Continued.)
14
15
16
17
18
19
20
21
22
23 24 25
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7229 Jordan-redirect/White
1 REDIRECT EXAMINATION
2 BY MR. WHITE:
3 Q Now, you had ju
st been asked a lot of questions by
4 Mr. Neville and others regarding the fact there is not a
5 signed statement by Mr. Rubin. Do you recall that?
6 A Yes.
7 Q When Mr. Rubin made the statement that you testified
8 about, tell us where his hands were?
9 A He was handcuffed.
10 Q And he was in the front seat of your car, right?
11 A That's correct.
12 Q Wouldn't that make it a little difficult to sign
13 statements?
14 MR. JENKS: Objection.
15 THE COURT: Sustained.
16 BY MR. WHITE:
17 Q And Mr. Neville asked you if you had any idea why
18 Mr. Rubin gave you those documents. Do you remember that?
19 A Yes, I do.
20 Q Did Mr. Rubin indicate to you why he was giving you
21 and Inspector Biegelman those documents?
22 MR. DUNN: Objection, Your Honor.
23 THE COURT: Let me have a read back. 24 (Record read.) 25 THE COURT:
Sustained.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7230 Jordan-redirect/White
1 MR. WHITE: Your Honor, on what ground? I'm not
2 clear.
3 THE COURT: It's not relevant.
4 MR. WHITE: It's not relevant what he said to
5 them?
6 THE COURT: Yes.
7 BY MR. WHITE:
8 Q Now, you were shown the written consent to search
9 that Mr. Rubin signed. Do you see that?
10 A Yes.
11 Q Now, who initiated the giving of documents to you and
12 Inspector Biegelman?
13 A Mr. Rubin.
14 Q And does that go for the ones in his apartment as
15 well as the ones in his car?
16 A That's correct.
17 Q Now, you told Mr. Neville you had very little to do
18 with the investigation of the mail fraud part of this
19 case.
20 A That's correct.
21 Q Were you there when Mr. Rubin made the statements
22 that he ma
de?
23 A Yes, I was. 24 Q And did you hear them? 25 A Yes, I heard them.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7231 Jordan-redirect/White
1 Q Do you remember them?
2 A Yes, I remember them.
3 Q Is there anything that you testified to today that
4 you don't have an independent recollection of?
5 A No.
6 Q Now, you were asked about whether or not Mr. Rubin
7 had signed Inspector Biegelman's notes. Do you remember
8 that?
9 A Yes.
10 Q Now, in your dozen years as an agent, are you
11 familiar, have you ever had a suspect initial an agent's
12 notes of an interview?
13 A No.
14 MR. LEE: Objection, Your Honor.
15 THE COURT: Overruled.
16 A No, never.
17 BY MR. WHITE:
18 Q Now, when Mr. Rubin was first placed under arrest on
19 the walkway outside of his house, was anything sa
id to him
20 about whether or not he had a right to remain silent?
21 A We told him that he didn't have to say anything.
22 Q And then in the car was he read his rights?
23 A He was read his Miranda rights, yes. 24 Q And that was when Mr. Rubin was handcuffed; is that 25 right?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7232 Jordan-redirect/White
1 A That's correct.
2 Q And you saw that, you were shown by Mr. Dunn that the
3 waiver of rights form or the warning of rights form says
4 1:06 p.m.; is that right?
5 A That's correct.
6 Q So that is after, after you got back to the Who's Who
7 office in Lake Success?
8 A Yes.
9 Q And does that form say anything regarding what took
10 place in the car?
11 A Yes.
12 Q What does it indicate?
13 A It says "orally advised Steven Rubin of his rights
14 and
said he understood it."
15 Q Now, up in the top left-hand corner of the form does
16 it have a line where it says "place"?
17 A Yes, it does.
18 Q What does it say on that line?
19 A It says SA Jordan's LEV.
20 Q Is SA an abbreviation for Special Agent?
21 A Yes.
22 Q Do you know what LEV refers to?
23 A Yes, that refers to my law enforcement vehicle. 24 Q So in other words, the place listed there is your 25 car; is that correct?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7233 Jordan-redirect/White
1 A Yes.
2 Q What is the time listed of the warning?
3 A The time is 11:45 a.m.
4 Q So the warning is 11:45 but Mr. Rubin signed it after
5 1 o'clock; is that right?
6 A That's correct.
7 Q Now, I want to discuss the interview with
8 Mr. Reffsin.
9 Now, you remember you said that Mr. Reffsin had
10 told you that Mr. Gordon told him of the Grossman's
11 ownership interest in the company in June of '92. That's
12 what you testified, correct.
13 MR. WALLENSTEIN: Objection.
14 THE COURT: On what ground?
15 MR. WALLENSTEIN: Beyond the scope of cross.
16 MR. WHITE: Your Honor, Mr. Trabulus asked about
17 that. I'm getting to a point.
18 THE COURT: All right.
19 BY MR. WHITE:
20 Q Do you recall that you testified --
21 THE COURT: Based on that statement I'll let him
22 pursue it.
23 Q You testified that that is what took place in June of 24 '92? 25 A That's correct.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7234 Jordan-redirect/White
1 Q And you recall Mr. Trabulus showed you Inspector
2 Biegelman's notes which indicated that Mr. Reffsin said
3 that took place in 1991?
4 A That's correct.
5 Q Can you explain why it is that your recollection is
6 that he said it was June of '92?
7 A Because Mr. Reffsin was referring to when the 1991
8 income tax return was filed for Who's Who Worldwide and
9 that took place, I believe, in June of 1992.
10 Q So that's the explanation for the discrepancy?
11 A That's correct.
12 Q Mr. Trabulus asked you about the meeting you had with
13 Mr. Bailey. Do you remember that?
14 A Yes.
15 Q And Mr. Bailey gave you a one or two-page document
16 you said, right?
17 A That's correct.
18 Q And without telling us the specific contents, was
19 that information in the document public information?
20 A Yes.
21 Q Can you describe generally what sort of information
22 was in it?
23 A Liens. 24 Q What do you mean by "liens"? 25 A Liens put on -- liens put against Mr. Gordon by the
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7235 Jordan-redirect/White
1 Internal Revenue Service.
2 Q And is that an actual piece of paper? What is a
3 lien? What are you talking about?
4 MR. TRABULUS: Objection, Your Honor.
5 THE COURT: Overruled.
6 A The Internal Revenue Service puts a lien against
7 somebody when they owe the Internal Revenue Service a sum
8 of money and little or no payments are made.
9 Q Is that a document that is filed in a public place?
10 A With the County Clerk.
11 Q Now, Mr. Wallenstein asked you about the accountant's
12 role in submitting an Offer and Compromise. Do you
13 remember that?
14 A Yes.
15 Q And he indicated that part of the accountant's role
16 was to negotiate on behalf of his client, right?
17 A That's correct.
18 Q And he asked you questions regarding what the role of
19 an
accountant was in that circumstance. Do you remember?
20 A Yes.
21 Q When an accountant is representing someone in
22 connection with an Offer and Compromise -- let me withdraw
23 the question. 24 The negotiations between a taxpayer and his 25 representative on the one hand and the IRS in connection
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7236 Jordan-redirect/White
1 with an Offer and Compromise, is that supposed to be based
2 on accurate underlying information?
3 A Yes.
4 Q And then if the accurate information is made
5 available then the sides can negotiate about how much to
6 pay, right?
7 A Yes.
8 Q Now, I want to ask you about the January '96
9 interview of Mr. Reffsin, the second one. Mr. Wallenstein
10 asked you about what Mr. Reffsin said. He asked you a lot
11 of questions about what Mr. Reffsin said about t
he logs.
12 Do you recall that?
13 A Yes, that's correct.
14 Q Now, can you clarify for us the sequence of what was
15 said by Mr. Reffsin with respect to the log in that
16 interview?
17 A Yes.
18 At first Mr. Reffsin had said, some summary he
19 never saw them and never spoke to anyone about them. In
20 the later part of the interview he relates the story that
21 Mr. Gordon showed them to him and said it was inadequate
22 and told Mr. Gordon to have them redone.
23 Q Let me show you Government's Exhibit 3500-4-E and 24 also 4-F. 25 If you could just make sure you review the dates
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7237 Jordan-redirect/White
1 on those two documents.
2 A (Perusing.) Okay.
3 Q And then if you can look at 4-F and also compare it
4 to -- just one moment.
5 MR. WHITE: I have to as
k a question of
6 Mr. Wallenstein.
7 (Counsel confer.)
8 BY MR. WHITE:
9 Q If you can look at 3500-4-F and compare it to
10 3500-16-G, the date on that.
11 MR. TRABULUS: Objection, Your Honor. I know
12 there is no question yet but there's a request for a
13 comparison and I object.
14 THE COURT: On what ground?
15 MR. TRABULUS: He will ask him as to the
16 comparison of the dates between the two documents. 4-F is
17 something apparently Agent Jordan has nothing to do with,
18 it's not in evidence, it's notes of a meeting he didn't
19 attend.
20 THE COURT: What is the purpose of this?
21 MR. WHITE: Mr. Wallenstein asked a lot of
22 questions about the sequence of interviews of Reffsin and
23 Gaspar. I want to ask the agent to clarify it. 24 THE COURT: All right. Overruled. 25 BY MR. WHITE:
OWEN M. WICKER, RPR OFFI
CIAL COURT REPORTER 7238 Jordan-redirect/White
1 Q Now, as you just heard me say, Mr. Wallenstein asked
2 you a lot of questions about the sequence of meetings of
3 Maria Gaspar and Mr. Reffsin, correct?
4 A Correct.
5 Q Can you tell us when you interviewed Mr. Reffsin --
6 let me back up.
7 The first interview of Mr. Reffsin in May of
8 '95, --
9 A Correct.
10 Q -- Did you know about the log at that time?
11 A No.
12 Q In January of '96 when you interviewed him a second
13 time, did you know about the log?
14 A Yes.
15 Q And in the interim how did you learn about the logs?
16 A From Inspector Biegelman.
17 Q Now, you indicated before that it was your
18 understanding that he learned about them from Maria Gaspar
19 in a meeting in between; is that correct?
20 A That's correct.
21 Q Now, do you recall Mr.
Trabulus asked you about the
22 form 433 and that column that says "necessary expenses"?
23 A Yes. 24 Q Now, Mr. Trabulus asked you whether it was your 25 understanding that someone is supposed to list only their
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7239 Jordan-redirect/White
1 necessary expenses and not all their expenses. Do you
2 remember that?
3 A Yes.
4 Q You were also asked by Mr. Wallenstein about
5 documents that were submitted to the IRS in connection
6 with the Offer and Compromise. Do you remember that?
7 A Yes, that's correct.
8 Q Now, take a look at Exhibit 422 which is in
9 evidence. Just follow along. That is a letter dated
10 November 24, 1993 from Mr. Gagliardi to Mr. Gordon in care
11 of Mr. Reffsin. Paragraph six.
12 "For verification of all monthly payments if not
13 paid by your personal chec
k." Do you see that?
14 A Yes.
15 Q Now, does that limit the things it's asking for only
16 to the necessary expenses?
17 A No, it's not.
18 Q Take a look at Exhibit 423 in evidence which is the
19 response from Mr. Gordon and Mr. Reffsin and look through
20 that and tell us if there is any verification of monthly
21 payments that are not paid by Mr. Gordon's personal check?
22 A (Perusing.)
23 MR. TRABULUS: What exhibit? 24 MR. WHITE: 423. 25 A No.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7240 Jordan-recross/Trabulus
1 Q So even though the request is not limited by the term
2 "necessary," there is still no verification of expenses;
3 is that right?
4 A That's correct.
5 MR. WHITE: Your Honor, no further questions.
6 RECROSS-EXAMINATION
7 BY MR. TRABULUS:
8 Q Agent Jordan, while I'm here and
I notice these
9 documents that you said were signed by Mr. Rubin, I assume
10 he wasn't in handcuffs at the time he signed any of these
11 documents, right?
12 A I wasn't there when he signed them.
13 Q Tell me, sir, the signature above the word -- I'm
14 showing you I guess it is DA "warning and waiver of
15 rights." The signature line and there's something above
16 it. And then AW, "consent to search." And below the
17 signature of consent, there's a signature line there,
18 sir.
19 A Yes.
20 Q Does that look like the same handwriting, sir?
21 A I'm not a handwriting expert, sir.
22 Q Do you need to be a handwriting expert to answer that
23 question, sir? 24 A Accurately, yes. I don't recognize Mr. Rubin's 25 handwriting.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7241 Jordan-recross/Trabulus
1 MR. TRABULUS
: Your Honor, I would like to
2 publish these to the jury.
3 THE COURT: Yes.
4 BY MR. TRABULUS:
5 Q Incidentally you were asked where Inspector Biegelman
6 is and you said you believe he is in California. He's
7 alive and well, as far as you know?
8 A As far as I know, yes.
9 Q He's still a postal inspector?
10 A As far as I know.
11 Q Now, you were asked some questions by other attorneys
12 and also by Mr. White about the interviews with
13 Mr. Reffsin. I think you indicated you were shown the
14 notes 3500-16-G and 3500-16-F.
15 The first meeting with Mr. Reffsin I think you
16 indicated took an hour; is that right? About an hour?
17 A Yes.
18 Q Was the second one about the same length?
19 A A little bit less.
20 Q And the notes in Inspector Biegelman's handwriting
21 were six pages in length?
22 A May I see it?
23 Q I'll show it to you. 24 A I just want to be accurate. 25 Q Six pages handwritten?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7242 Jordan-recross/Trabulus
1 A (Perusing.) Yes.
2 Q And the second one about five, and the third page is
3 handwritten?
4 A Yes.
5 Q And you don't get as much handwriting on a page as
6 you do typewriting; is that right?
7 A Normally.
8 Q And is it fair to say, sir, that in this case when we
9 were listening to tapes, we listened to some tapes of
10 telephone conversations that lasted about 15, 20 minutes
11 where the entire, the transcript during that period of
12 time would be 16, 18, 20, single spaced typewritten
13 pages. Do you recall that, sir?
14 A Yes.
15 Q So is it fair to say there were lots of words that
16 were said in this meeting which Inspector Biegelman did
17 not put down; is that correct, sir?
18 A There were some words, sure.
19 Q Well, is it fair to say that the vast majority of
20 words were not put down by Inspector Biegelman. I mean,
21 this didn't purport to be a verbatim transcript or
22 anything like it?
23 A That's correct, yes. 24 Q They were notes that Inspector Biegelman deemed it 25 important to put down; is that correct?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7243 Jordan-recross/Trabulus
1 A I can't answer that yes or no.
2 Q For his purposes, sir.
3 A I can't answer that yes or no.
4 Q Now, you were just asked some questions about a
5 letter from Inspector Gagliardi, number 422, and you were
6 asked about how it asked for verification of more monthly
7 payments if it was not paid by your personal check?
8 A Yes.
9 Q It didn't say that it was supposed
to be put on a
10 form 433-A, did it?
11 A That's correct.
12 Q And indeed the form 433-A that was submitted
13 contained the same language basically as other form
14 433-A's in terms of the form language, right?
15 A Yes.
16 Q And there was a column that said "necessary living
17 expenses," right?
18 A Yes.
19 Q In fact, if under that things that were not necessary
20 living expenses were included, unless there was some
21 explanation on the form to say that, it would be
22 erroneous, would it not?
23 A I don't agree with that. 24 Q In other words, if something that wasn't a necessary 25 living expense was listed there, then wouldn't it be fair
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7244 Jordan-recross/Trabulus
1 to say that unless you knew to look at let's say a letter
2 that told you to fill it out diffe
rently than it said, it
3 would be erroneous, correct?
4 A No.
5 Q Again, you didn't look at the instructions so you
6 don't know what it says about how it has to be filled out,
7 right?
8 A I didn't look at the instructions.
9 Q You also said you didn't look at the instructions for
10 the Offer and Compromise; is that correct?
11 A That's correct.
12 Q Now, I'm going to show you Exhibit 428 in evidence,
13 my copy of it, and that's the amended Offer and
14 Compromise, the 1994 version.
15 A If it's only three pages, yes.
16 Q 420-A, that's the original Offer and Compromise in
17 evidence, dated 1993?
18 A (Perusing.) Yes.
19 Q Now, on both of those forms what's the first thing it
20 says at the top on the right next to "Offer and
21 Compromise"? It says filed in triplicate, right?
22 A Yes.
23 Q What is the next thing it s
ays? 24 A See instructions, page 4. 25 Q But you never looked at those instructions when you
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7245 Jordan-recross/Trabulus
1 were analyzing the forms, is that fair to say?
2 A That's correct.
3 Q And do you know those instructions from memory, sir?
4 A No.
5 Q And did you know them from memory during the course
6 of your investigation?
7 A No.
8 Q Do you know where those instructions that apply to
9 those forms, offers and compromise are today?
10 A I don't understand the question.
11 Q Do you know when they were submitted to the IRS, if
12 copies of the instructions were attached?
13 A I don't believe they were.
14 Q Do you know whether the IRS maintains in its files
15 copies of the instructions that were associated with forms
16 of offers and compromise as they were
used from time to
17 time?
18 A I don't understand the question.
19 Q Well, you saw that form of Offer and Compromise,
20 right?
21 A Yes.
22 Q And the form of Offer and Compromise gets revised
23 from time to time; is that right? 24 A I would assume so. 25 Q The number of certain boxes change and they ask for
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7246 Jordan-recross/Trabulus
1 additional information and take it out?
2 A Revised, yes.
3 Q Same thing with the form 433-A?
4 A The forms are revised.
5 Q Does the IRS maintain a library of old forms?
6 A Some forms are in that library, to my knowledge.
7 Q I mean, do you as an investigator who sometimes has
8 to look for forms that were filed eight or nine years ago
9 have access to a library of what the forms were at that
10 period of time?
1
1 A In some cases they have the forms, yes.
12 Q And do you have access -- withdrawn.
13 Does the IRS keep the instructions that it gave
14 out to taxpayers for the forms that were in use in past
15 years?
16 A You mean associated with the --
17 Q Yes.
18 A -- With the stuff? I'm unclear of your question.
19 Q Let me see if I can make it clear.
20 Let's say you had to go back and look at a form
21 that a taxpayer filled out in 1990 or 1991.
22 A Okay.
23 Q Would you have access to the instructions that went 24 with that form? 25 A Maybe, maybe not.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7247 Jordan-recross/Dunn
1 Q Do you know whether they are still in existence, sir,
2 for these forms here, the forms in Offer and Compromise or
3 form 433-A?
4 A Are the instructions still there, I don't know.
5 MR.
TRABULUS: I have no further questions.
6 THE COURT: Anything else?
7 RECROSS EXAMINATION
8 BY MR. DUNN: .
9 MR. DUNN: May I just ask the jury if I can have
10 a couple of exhibits or so.
11 THE COURT: Yes. While you are there you might
12 as well return all the exhibits to their proper place.
13 BY MR. DUNN:
14 Q If I'm correct, the Consent to Search form, you said
15 you don't have any recollection of that being signed out
16 in Elmont, right?
17 A That's correct.
18 Q But for some reason somebody thought it was important
19 to later memorialize the fact that Steve Rubin had
20 consented to have his house and auto searched; is that
21 correct?
22 A Yes.
23 Q I mean, this had to be done at the earliest back at 24 Lake Success, correct? Is that fair to say at the 25 earliest?
OWEN M. WICKER, RPR OFFICIAL COURT REP
ORTER 7248 Jordan-recross/Dunn
1 A Yes.
2 Q And the warning to remain silent, the fact that the
3 warnings were given at 11:45 that apparently was
4 memorialized also after you arrived from Elmont to Lake
5 Success at the earliest, correct?
6 A Yes.
7 Q And somebody at some point writes down "orally
8 advised Steve Rubin of his rights." It said that he
9 understood it. Someone thought that was important and
10 they had that memorialized; is that right?
11 A Yes.
12 Q We don't know when because there is no time-frame on
13 this handwritten little thing, correct?
14 A Correct.
15 Q But nowhere, nowhere is it memorialized what you
16 claim he said in the vehicle, correct?
17 A It's in Inspector Biegelman's notes.
18 Q In his notes.
19 But it wasn't memorialized, it wasn't written
20 down and signed anywhere. I mean,
someone had to sign a
21 consent form. Someone had him sign a rights form, but no
22 one had him sign a statement, correct?
23 A To the best of my knowledge, yes. 24 Q Back at Lake Success, there were plenty of desks 25 there, someone can sit down and write anything out they
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7249 Jordan-recross/Dunn
1 wanted to, correct?
2 A In this case that would have been difficult.
3 Q Well, it wasn't difficult to have him sign these
4 things though, was it? I mean, look at these names.
7 addresses. It wasn't difficult to do that, was it?
8 A I don't know.
9 Q Maybe it was difficult.
10 Imagine what it was like writing with handcuffs,
11 this long document. It must have been an awful
12 experience.
13 A Is that a question?
14 Q No, I'll withdraw it.
15 Let me ask you this. I'm a little confused. I
16 watch these cop shows, NYPD Blue, and maybe it goes to
17 show you that television is just ridiculous.
18 When the cops go to the guy they are interviewing
19 and they say, here's a pad and a pen, write it down and
20 sign it, stuff like that, that never happens in real life?
21 A To my knowledge, no.
22 Q You mean --
23 A I've never done that. 24 Q You've never done that? 25 A No.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7250 Jordan-recross/Dunn
1 Q And you don't think any other law enforcement agent
2 in this great country of ours ever does it either?
3 A I can't answer for them, they might.
4 Q So when I see the stuff on TV when they hand somebody
5 a pad and pen and they say writ
e it down, those things
6 don't happen?
7 MR. WHITE: Objection.
8 THE COURT: Sustained.
9 MR. DUNN: If I may just have one more moment,
10 Your Honor?
11 THE COURT: Yes.
12 (Counsel confer.)
13 MR. DUNN: If I may, Your Honor.
14 BY MR. DUNN:
15 Q I would like to show you AY for purposes of
16 identification, and something like that. Have you ever
17 seen anything like that in law enforcement?
18 A I never use these.
19 MR. DUNN: Your Honor, I would like to introduce
20 this what appears to be a sworn statement by Tara Garboski
21 concerning Who's Who Worldwide. It's a document that was
22 provided by the government and I would like to have it
23 introduced in evidence. 24 THE COURT: Any objection? 25 MR. WHITE: I haven't seen it, Your Honor.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7251 Jordan-re
cross/Dunn
1 Your Honor, the government has an objection.
2 THE COURT: May I see it?
3 This is hearsay. What is the exception to the
4 hearsay rule?
5 MR. DUNN: Then, Your Honor, in lieu of that, if
6 I can just have a stipulation that something like that was
7 made as opposed to the substance of it.
8 THE COURT: You can have a stipulation, yes.
9 MR. WHITE: If Mr. Dunn wants to introduce a
10 blank form, that's fine with me.
11 THE COURT: Well, there are written statements
12 made, aren't there, Special Agent Jordan? Law enforcement
13 officers take written statements all the time, don't they?
14 THE WITNESS: I don't, but some do, yes.
15 THE COURT: But you heard of this, right?
16 THE WITNESS: Yes.
17 THE COURT: Usually they make out the statement
18 and have the person who is giving the statement sign it,
19 correct?
20 THE
WITNESS: Like an affidavit.
21 THE COURT: Like a statement?
22 THE WITNESS: Yes.
23 THE COURT: And if there is a correction they put 24 initials down, right? You've seen that? 25 THE WITNESS: Yes.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7252 Jordan-recross/Dunn
1 THE COURT: That's what is done from time to
2 time, correct?
3 THE WITNESS: Yes.
4 THE COURT: But you didn't do that in this case?
5 THE WITNESS: That's correct.
6 THE COURT: Okay.
7 MR. DUNN: Your Honor, I think it might be an
8 exception to the hearsay rule, not being admitted for the
9 truth of the matter but just admitted to the fact that
10 these type of form statements were given on that date.
11 THE COURT: Except it has evidence in the case.
12 If you have another type of statement in another case, not
13 this one, I'll let you put it in.
14 MR. DUNN: The only other thing, Your Honor --
15 THE COURT: In other words, the government
16 objects to this because it has statements made by a
17 defendant in this case which is not admissible.
18 MR. DUNN: If we can stipulate something that I
19 can put in a blank, or the same form.
20 THE COURT: If anybody has a statement in the
21 case from ten years ago, I'll let you put it in. The jury
22 can see it.
23 MR. DUNN: What I'll do, Your Honor, I'll redact 24 the handwritten stuff at the bottom and the printed stuff 25 can possibly go in, if that is all right with the Court.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7253 Jordan-recross/Dunn
1 THE COURT: Good. That's a good idea. I'll let
2 that in.
3 MR. DUNN: Thanks, Your Honor.
4 THE COURT: Very well.
5 Anything else, Mr. Dunn?
6 MR. DUNN: Yes.
7
BY MR. DUNN:
8 Q Would it surprise you to learn, Agent Jordan, that
9 Mr. Rubin's landlady is in her mid 70s?
10 A No.
11 Q That wouldn't surprise you?
12 A No.
13 MR. DUNN: I have no further questions.
14 THE COURT: All right.
15 (Continued.)
16
17
18
19
20
21
22
23 24 25
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7254 Jordan-recross/Wallenstein
1 RECROSS-EXAMINATION
2 BY MR. WALLENSTEIN:
3 Q Agent Jordan, the preparation and review of an Offer
4 and Compromise would be part of the Revenue Agent's
5 responsibilities rather than the Special Agent's, correct?
6 A It would be a revenue officer.
7 Q A revenue officer.
8 It would not be a part of your function except as
9 an after the fact review of all the documents in the case;
10 is that correct?
11 A Yes.
12 Q And so that the authorities would say we'll accept
13 this offer, we won't accept this offer, we'll negotiate
14 this offer, would be the revenue officer, not you?
15 A Not me, that's for sure.
16 Q And the particular nuances of the Offer and
17 Compromise and the familiarity with the instructions would
18 be again the revenue officer rather than you?
19 A That's correct.
20 Q Now, you indicated with respect to the ownership of
21 the corporations in response to Mr. White's questions on
22 redirect that Mr. Reffsin told you that in 1992 you
23 learned that Joyce Grossman earned 80 percent of the 24 company. 25 A What I recall Mr. Reffsin saying -- can I explain?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7255 Jordan-recross/Wallenstein
1 Q Please.
2 A What I recall Mr. Reffsin sayi
ng when the 1991 return
3 was filed which is in 1992, June of 1992, he learned that
4 Joyce Grossman, that the Grossmans were owners in the
5 company.
6 Q Did he give you a percentage at that time?
7 A If you can show me the notes I'll refresh my memory.
8 Q Well, let me ask you this. Do you recall Mr. Reffsin 9 telling you that in 1992 when he did the 1991 returns, he
10 learned at that time that the Grossmans owned 25 percent
11 of the company and that's what he was told by Mr. Gordon.
12 And the subject came up because Dr. Grossman had had a
13 discussion with him with respect to the ownership of the
14 company?
15 A I don't understand the question.
16 Q Do you recall Dr. Grossman testifying here during
17 this trial that he had a discussion with Mr. Reffsin 18 sometime in 1992?
19 A I don't recall.
20 Q Do you recall Mr. Reffsin telling you at an
y time
21 that in 1992 when he did the 1991 return, that's when he
22 learned that the Grossmans owned 25 percent of the
23 company, and in 1993 when he did the 1992 return, that's 24 when Gordon told him that the Grossmans owned 75 percent 25 of the company?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7256 Jordan-redirect/White
1 A That's not what I recall from the interview.
2 MR. WALLENSTEIN: I have no further questions.
3 THE COURT: Anything else?
4 MR. WHITE: Yes, Your Honor.
5 REDIRECT EXAMINATION
6 BY MR. WHITE:
7 Q The IRS instructions regarding the forms that
8 Mr. Trabulus asked you about --
9 A Yes.
10 Q -- Have you made in the course of this investigation,
11 did you make any request to see if the instructions for
12 these 433s in evidence in this case could be located?
13 A No.
14 Q Now, In
spector Biegelman who Mr. Trabulus asked you
15 if he's alive and you said he was in California, do you
16 remember that?
17 A Yes.
18 Q Is he permanently assigned to California?
19 A To the best of my recollection, yes.
20 MR. WHITE: No further questions.
21 THE COURT: Anything else?
22 MR. NEVILLE: I have just one question from here.
23 MR. TRABULUS: Actually, I have one from here 24 too. 25 THE COURT: Okay.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7257 Jordan-recross/Neville
1 RECROSS-EXAMINATION
2 BY MR. NEVILLE:
3 Q Do you know whether they suspended air service from
4 California to New York?
5 A Not to my knowledge.
6 RECROSS-EXAMINATION
7 BY MR. TRABULUS:
8 Q My question is, is he any more permanently assigned
9 to California than any of those witnesses who are members
10 of
Who's Who Worldwide who lived there and was brought in
11 by the government?
12 A I can't answer that.
13 MR. TRABULUS: I have no further questions.
14 THE COURT: Anything else?
15 MR. WHITE: No, Your Honor.
16 THE COURT: Anything else?
17 Call your next witness.
18 MR. WHITE: Your Honor, I have some tapes.
19 THE COURT: Why did I think you have some tapes
20 at 12 minutes to 5.
21 Go ahead.
22 MR. WHITE: Your Honor, the first one is Exhibit
23 1302. The transcript is 1302-C, like in Charlie. 24 The date is August 22, 1994. The call is to 25 Who's Who Worldwide, and the salesperson is Jill Barnes.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7258
1 (Audiotape played.)
2 (Start and stop.)
3 MR. WHITE: The next is 1303. The transcript is
4 1303-A, for Able.
5 The date is August 24, 1994. The call
is to
6 Who's Who Worldwide, and the salesperson is Alan Davidson.
7 (Audiotape played.)
8 (Start and stop.)
9 MR. WHITE: Next is 1310. The transcript is
10 1310-B, for Baker.
11 The date is October 28, 1994. The call is to
12 Who's Who Worldwide and Linda May.
13 (Audiotape played.)
14 (Start and stop.)
15 MR. WHITE: Next is 1312. The transcript is
16 1312-A, for Able.
17 The date is October 28, 1994. The call is to
18 Sterling Who's Who and Robert Stanley.
19 (Audiotape played.)
20 (Start and stop.)
21 MR. WHITE: Next is 1313. The transcript is
22 1313-A, for Able.
23 The date is October 31, 1994. The call is to 24 Who's Who Worldwide and Enid Rose, R-O-S-E. 25 (Audiotape played.)
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7259
1 (Start and stop.)
2 MR. WHITE: Next is 131
4. The transcript is
3 1314-A.
4 The date is November 1, 1994. The call is to
5 Sterling Who's Who and Andrea Franklin.
6 (Audiotape played.)
7 (Start and stop.)
8 MR. WHITE: Next is 1316. The transcript is
9 1316-A, for Able.
10 The date is November 2, 1994. The call is to
11 Sterling Who's Who and Anthony Myers.
12 (Audiotape played.)
13 (Start and stop.)
14 MR. WHITE: Next is 1321. The transcript is
15 1321-C, for Charlie.
16 The date is November 7, 1994. The call is to
17 Sterling Who's Who and Sam Christopher.
18 (Audiotape played.)
19 (Start and stop.)
20 MR. WHITE: The next is 1328. Transcript is
21 1328-A, for Able.
22 The date is December 1, 1994. The call is to
23 Who's Who Worldwide and Marilyn Pierce. 24 (Audiotape played.) 25 (Start and stop.)
OWEN M. WICKER, RPR OFFICIAL CO
URT REPORTER 7260
1 MR. WHITE: Next is 1337. The transcript is
2 1337-A, for Able.
3 The date is December 21, 1994. It's a call to
4 Who's Who Worldwide and Alan Saffer.
5 (Audiotape played.)
6 (Start and stop.)
7 THE COURT: All right. I think that does it.
8 MR. WHITE: Okay.
9 THE COURT: Members of the jury, we'll recess
10 until 9:30 tomorrow morning. In the meantime, as I've
11 told you right from the beginning of the trial and it's
12 very important and that's why I repeat it every night,
13 every recess, every lunch hour. Don't discuss the case
14 either among yourselves or with anyone else. Keep an open
15 mind. Come to no conclusions until the entire case is in
16 and until you've heard the closing arguments of counsel
17 which although is not evidence is very important to listen
18 to the lawyers' view of what the evidenc
e is, and you
19 don't have to agree with them but you have to listen to it
20 and consider it. If anything they say is inconsistent
21 with what you recall the evidence is, use your own
22 recollection. Then I'll instruct you on the law on these
23 various counts. Then you'll go into the jury room and 24 talk among yourselves. For the first time you will 25 exchange views and then that's when you start making
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7261
1 decisions.
2 We'll recess until 9:30.
3 Have a nice evening.
4 (Jury exits.)
5 THE COURT: Somebody left me Government's Exhibit
6 3500-16-B and E, is that for me?
7 MR. WHITE: Yes, Your Honor. That was some new
8 3500 with respect to Agent Jordan that I handed out to
9 defense attorney this morning. I wanted to give you a
10 copy as well.
11 THE COURT: Al
l right.
12 MR. SCHOER: I believe the last transcript played
13 was 1337-B, and it was B.
14 THE COURT: That's correct, you said "A" but it
15 was B. You can correct the record and you can tell that
16 to the jury tomorrow when it comes up.
17 Now, who is coming on tomorrow?
18 MR. WHITE: Your Honor, that's it in terms of
19 witnesses. There's a possibility that Mr. Saint or
20 Mr. Smith who are the two customers that we expected today
21 and they might come. But failing that there are just a
22 couple other things that the government would put in and
23 we would rest. 24 THE COURT: That's tomorrow morning. 25 MR. WHITE: Right. The things that are left is
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7262
1 there is a stipulation that I expect to reach with
2 Mr. Trabulus, he needs to review some exhibits to verify
3 that
. There's the issue of Mr. Maxes' allocation which
4 you'll have to rule on.
5 THE COURT: You can do that right now so we can
6 get that out of the way.
7 MR. WHITE: In addition, there are some tapes
8 that we did not offer into evidence as part of the
9 stipulation when we entered them a couple weeks ago. The
10 reason for that was that the defense, as I understand it,
11 agreed to the authenticity. I think there were three of
12 them where they did not believe it was admissible because
13 the government's view is that they were corporate
14 admissions and they felt that it was not. So we removed
15 that from the stipulation and figured we would have to
16 argue that before Your Honor. So we need to resolve that
17 too. If Your Honor rules that they are corporate
18 admissions then we have to introduce them and we'll do
19 that tomorrow.
20 THE COURT: Well,
insofar as -- why doesn't
21 everybody have a seat. As far as the Maxes, is it the
22 plea, what about that? Anybody want to respond?
23 MR. TRABULUS: I would like to address that, Your 24 Honor, and I think other people may want to address it 25 too.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7263
1 THE COURT: Go ahead.
2 MR. TRABULUS: I would like to preface my
3 comments by a couple of things, I didn't learn until I
4 read the government's letter that Mr. Maxes was dead.
5 Mr. Maxes, we received 3500 material and up until very
6 recently I had assumed that he was going to be testifying
7 for the government. The only thing that made me think he
8 would not be is that the government indicated that they
9 would be resting this week and I thought his testimony
10 would take a long time.
11 So I thought that perhaps they decided
not to go
12 forward with him or with another witness as well, Sue
13 Mantell, who they also had given 3500 material on.
14 Your Honor, I don't know when Mr. Maxes died. I
15 would like to also note I had sought to subpoena him for
16 the hearing in December. I understand that he died more
17 recently than that. I don't know if he would have been
18 able to testify at that point in time, I don't know what
19 his condition was. Certainly at that point no argument
20 was made that he was unable to testify physically.
21 Had he done so or had I done so I probably would
22 have had some cross-examination material that might have
23 come in to impeach statements in the allocution. But 24 leaving all of that aside, I know Your Honor ruled on that 25 aspect of it where Judge Pohorelsky refused to authorize
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7264
1 the issuance of a subpoena for him. There is no basis for
3 and not merely cumulative, it doesn't even support what
4 its being offered for.
5 If you look at Maxes' plea allocution --
6 THE COURT: Well, do we have that? Just wait one
7 minute.
8 MR. TRABULUS: 13-500-18-J.
9 THE COURT: Just hold it a minute now.
10 MR. DUNN: Your Honor, may I just step out to the
11 mens room for a minute. I'll be right back.
12 THE COURT: I can't even turn this thing to 18-J
13 because it is very thick.
14 MR. SCHOER: The very last document.
15 THE COURT: I can't get to the last document
16 because the thing can't turn or else it's me. Does anyone
17 have a loose one of these things?
18 MR. NELSON: Your Honor, if I might approach,
19 I'll provide you with my copy. It's open to the page.
20 THE COURT: Okay.
21 MR. TRABULUS: Your Honor, shall I proceed?
22 THE COURT: No, let me read this.
23 (Pause in proceedings.) 24 THE COURT: Yes, Mr. Trabulus. 25 MR. TRABULUS: Yes, Your Honor.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7265
1 Firstly, the portion of the plea allocution which
2 is annexed to the government's letter begins at page 30.
3 At page 29 some material appears which I think is quite
4 significant in terms of the nature of this allocution.
5 Mr. White states "if I may, Your Honor, --" I'm
6 sorry. We should go back to page 28.
7 THE COURT: Well, my pages here are different.
8 MR. TRABULUS: On the plea allocution?
9 THE COURT: Yes.
10 Page 28 you said?
11 MR. NELSON: Page 28 on the plea allocution.
12 THE COURT: All right. I have it.
13 MR. TRABULUS: Your Honor asked Mr. Maxes,
14 "Mr. Maxes, would you describe in your own words what you
15 did in connection with the crime charged in the
16 information?" Mr. Rosencrantz who was Mr. Maxes' attorney
17 then interjected, "Judge, would it be proper for Mr. Maxes
18 to read an allocution we have gone over?
19 "The Court: Yes. As long as this is his
20 allocution."
21 And then Your Honor, the defendant started
22 reading and Your Honor cautioned him to read slowly.
23 Continuing on page 29, Your Honor asked him "but 24 before you do that, where did you get that statement 25 from? The Defendant, that's Mr. Maxes, "from the U.S.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7266
1 Attorney.
2 "Mr. White: If I may, Your Honor, I prepared an
3 allocution based on our debriefings of Mr. Maxes.
4 Approximately a month ago I sat down with him and asked
5 him to rev
iew it, make sure it was accurate. I told him
6 he would have to say under oath that that was the truth
7 and I asked him to inform me if there were any changes,
8 any corrections, any clarifications that needed to be
9 made. I can't recall it off the top of my head if he has
10 any, what he has here he's saying under oath and he
11 previously informed me and Mr. Rosencrantz that it is
12 accurate."
13 And then Mr. Rosencrantz says "we discussed it on
14 more than one occasion" and so forth and Your Honor asked
15 Mr. Maxes if that is the truth and he said that it is.
16 Now, Your Honor, at this point in time it was
17 clear to everybody around as the transcript shows that
18 Mr. Maxes had cancer and just had a colostomy, was in pain
19 taking medication and so forth. And what you have is an
20 allocution that was written by Mr. White as a cooperator
21 under those ci
rcumstances. Interesting in the allocution,
22 although Mr. White says he is offering it to show there
23 was a conspiracy, in that allocution Mr. Maxes does not 24 say that he agreed to do with anybody to do these things, 25 he simply says what he did.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7267
1 On top of that, Your Honor, this allocution was
2 carefully crafted to overcome what I think the government
3 at that time perceived Your Honor may have had objections
4 to based upon the Regent Office Supply case. I don't have
5 it handy with me, but I was given other 3500, a letter
6 written by the government and I think in the course of the
7 transcription raises Mr. White's erudition, by Mr. White
8 in a letter in support of why Your Honor should accept the
9 plea and it talks about the Regent Office Supply case.
10 And as I recall in the Rege
nt Office Supply case it says
11 that misrepresentations which do not go to the nature,
12 quality and value of the goods sold or to the nature of
13 the bargain, cannot constitute the basis for a mail fraud
14 prosecution.
15 So this allocution was carefully crafted to
16 contain Mr. Maxes' conclusions or actually the
17 government's conclusions that the misrepresentations that
18 he made went to the nature, quality and value of the
19 memberships. And therefore, for example, on page 31 of
20 the allocution it says "for example, I misrepresented the
21 nature, quality and value of the memberships by falsely
22 advising customers they had been personally nominated to
23 members in one of the company's directories by an 24 established member," etcetera. 25 Your Honor, I have a copy handed by other counsel
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
7268
1 and it was dated July 7, 1997. It was from Mr. White, a
2 single space letter urging the facts allocated to by
3 Mr. Maxes will constitute mail fraud and I seem to recall
4 in the transcript Your Honor averted to the fact that
5 materiality is now a jury question as opposed to a
6 question for the Court and that appeared to have entered
7 into Your Honor's determination to accept the plea.
8 What I'm getting to Your Honor, this particular
9 plea allocution doesn't talk about a conspiracy. Although
10 the plea was to a conspiracy count just as Mr. Saffer pled
11 to a conspiracy count and that is already in the record,
12 it doesn't establish the existence of a conspiracy. What
13 it does in the words given is make statements which would
14 bring in at least in the government's view, as stated by
15 Mr. Maxes, bring the misrepresentations that he says he
16 made within the umbrella of Regent Office Supplies as
17 being the basis for mail fraud. That really addresses,
18 comes to a legal conclusion which would go to the heart of
19 much of the defense here. I mean, what they've done is
20 they managed to find what -- what they are trying to do is
21 choose a plea allocution where the salesperson can't be
22 cross-examined.
23 Sue Mantell, Sue Mantell pled guilty sometime 24 afterwards and her plea allocution has also been given to 25 us as 3500 material and it is evident that the government
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7269
1 does not intend to call us even though she is alive and
2 well in the Long Island area. She gave the same plea
3 allocution word-for-word, same one scripted by the
4 government even though Magistrate Pohorelsky asked her
5 what she did, she recited it. It's
virtually
6 word-for-word.
7 If they want to have somebody to support that
8 they have a live witness to do that. This person Maxes is
9 dead and that's the only reason they want to rely on his
10 plea allocution instead of that which is something very
11 critical. It is here to address the Regent issues.
12 On top of that, Maxes is an individual who would
13 have been particularly susceptible to cross-examination.
14 He was cooperating with Inspector Leonard. Mr. Maxes had
15 worked for the West Organization and he was giving
16 information to Inspector Leonard of the postal service in
17 1990, 1991, 1992, and he was giving him information
18 concerning his employment at Who's Who Worldwide and what
19 was going on there. And he continued working there. He
20 was not charged with any crime at that point in time.
21 This is, I mean, that would have been very, very
22 further cross-examination material that we would have been
23 able to go into, as well as, by the way, the fact that 24 Mr. Maxes' wife was a member of Who's Who Worldwide, her 25 name is in the directory and apparently he paid for her
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7270
1 membership in this supposedly fraudulent organization.
2 So it is extremely prejudicial, Your Honor. It
3 doesn't go to the issue of conspiracy and it is just
4 designed to give the government a tailor made statement to
5 carry this right within the Regent Office Supply case says
6 could be mail fraud. It shouldn't be considered. On top
7 of everything else it is also cumulative.
8 MR. NELSON: Your Honor, if I might add in
9 addition to the 803 arguments in essence being made by
10 Mr. Trabulus I would submit this statement should not be
11 admissible.
12 THE COURT: What is an 803 argument?
13 MR. NELSON: That the prejudicial effect.
14 THE COURT: You mean 403.
15 MR. NELSON: I mean 403, I apologize, Your
16 Honor.
17 I would also add that this statement should not
18 be admissible because it was not a declaration against
19 penal interest at the time it was made. At the time this
20 statement was made, Mr. Maxes knew that he was dying. He
21 was very ill and very infirm at the time the plea was
22 taken. The minutes themselves reflect on page 5 his
23 attorney says he's barely capable of standing and speaking 24 at the time that he gives his allocution. On page 35 of 25 the transcript the Court indicates given the novel
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7271
1 situation.
2 THE COURT: What was the first page?
3 MR. NELSON: Page 5 of the transcript, Your
4 Honor.
5 MR. SCHOER: Line 16 and 17.
6 THE COURT: And what other page?
7 MR. NELSON: Page 35.
8 MR. SCHOER: Line 13.
9 THE COURT: When did Mr. Maxes die, Mr. White?
10 MR. WHITE: I'm sorry, I didn't hear Your Honor.
11 THE COURT: When did he die?
12 MR. WHITE: My understanding is he died near the
13 end of the year, end of 1997. I think the last week or
14 the last ten days of the year.
15 MR. NELSON: Now, I would submit, Your Honor, at
16 the time this statement was made, Mr. Maxes had made a
17 determination that rather than going through the ordeal of
18 this trial the last few months of his life he elected to
19 enter a guilty plea in this case. The government has
20 pointed to a case, United States v. Scopo, S-C-O-P-O,
21 which is located on page --
22 THE COURT: I have it.
23 MR. NELSON: I had the opportunity during the 24
luncheon recess to read that case, Your Honor, and on page 25 348 of the decision the Second Circuit states there's no
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7272
1 evidence that he, in this case it was an individual by the
2 name of Thomas Agro, who was a soldier in the Gambino
3 organized crime family who allocuted in a different case
4 and indicated that he and the defendant in the case on
5 trial had agreed in essence to bribe a prison guard, and
6 then subsequently Mr. Agro becomes ill. Defense counsel
7 raised a point that because he became ill there was a
8 belief or a subjective belief on the part of the person
9 who made the statement he would not wind up being
10 incarcerated when he made the statement and therefore it
11 wasn't against penal interest.
12 I would submit that the situation here is quite a
13 bit different. I would
like to read what the Second
14 Circuit said. "There is no evidence that he, meaning
15 Agro, had entered into any understanding that the
16 government or the Court that he would not be sentenced to
17 the crimes in which he allocated. While we stresses that
18 a defendant's unilateral belief did not suffice to
19 neutralize the exposure ordinarily inherent in a
20 self-incriminatory plea or allocution we also point out
21 even if Agro privately believed that because of his
22 illness the Court would not require him to suffer
23 incarceration, there would be little reason for him to 24 suppose that the Court would also therefore excuse him 25 from paying a fine.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7273
1 I would submit, Your Honor, this situation is
2 considerably different than the one that Mr. Agro is in.
3 First of all, it is
not a question whether the Court would
4 have imposed a fine on him. The man knew he was going to
5 die, the government knew he was going to die.
6 THE COURT: What did he die from?
7 MR. NELSON: From the transcript he was going to
8 die from --
9 THE COURT: What did he die from?
10 MR. WHITE: My information is that he did not die
11 from the cancer that he had, he had some sort of a heart
12 attack. It was news to me. During July through December
13 he kept us apprised of his condition and the last we heard
14 before we heard of his death was that his chemotherapy had
15 been working well, that his condition had improved. It's
16 precisely for that reason I didn't ask the Court, under I
17 forget what rule it is to schedule a pretrial deposition
18 to preserve his testimony. We thought it was okay. It
19 was unexpected that he died in the fashion that he did.
20 It's my understanding --
21 MR. NELSON: Your Honor, the second point I would
22 like to raise that also differentiates this case from
23 Scopo. In Scopo the individual whose statement was going 24 to be introduced had no cooperation agreement with the 25 government. In this instance Mr. Maxes did. It
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7274
1 segregates the situation distinctly. There are two
2 separate basis upon which this should not be considered to
3 be a statement against penal interest. One, the
4 individual had a cooperation agreement and, two, his
5 illness. Certainly the individual, Mr. Maxes, was well
6 aware at the time he took the plea that either he would
7 not be capable of appearing in court for purposes of the
8 trial or there was an extremely strong likelihood that he
9 would neither be facing incarceration or any for
m of
10 punishment due to his ailments.
11 THE COURT: What if he was facing probation?
12 Would that be against his penal interest?
13 MR. NELSON: Your Honor, I would submit it is not
14 sufficiently against his penal interest when balancing --
15 the question of the reliability of the statement against
16 the prejudicial effect as articulated already by
17 Mr. Trabulus by the carefully crafted statement prepared
18 by the government as part of the allocution. I would
19 submit to the Court and the other cases that have been
20 cited, specifically United States v. Muynet found at
21 458 Fed.Supp. 136 would be a more appropriate matter in
22 Muynet and its successor case would be a more appropriate
23 way to deal with this type of situation, and in that case 24 Judge Keenan as in a subsequent case which was similar in 25 nature which was United States v. Lopez, et al.
What
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7275
1 Judge Keenan did is he permitted the government to
2 introduce one paragraph of the information to which the
3 person pled guilty which indicated that the person pled
4 guilty to a count that he conspired with other people to
5 violate the mail fraud statute, not what the specific
6 underlying words were that were provided by the government
7 which sets forth the various different information which
8 the government seeks to introduce. I would submit that it
9 would be sufficient in this case for the government to be
10 allowed to elicit under paragraph 5 of the information
11 which is, I believe, 3500---
12 THE COURT: What is the name of those cases? Are
13 they in your letter, Mr. White?
14 MR. WHITE: The Lopez one is not. The other one
15 is.
16 THE COURT: What is the nam
e of the first one? I
17 have to get --
18 MR. NELSON: M-U-Y-N-E-T, Your Honor.
19 958 Fed.Supp. 136.
20 THE COURT: And what is Lopez?
21 MR. NELSON: Your Honor, I don't have the
22 citation before me. It was in a case that I was involved
23 in before Judge Keenan. 24 MR. TRABULUS: Your Honor, if I can supplement to 25 what I said before. With regard to the indicia of
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7276
1 reliability, there is evidence in the record here in this
2 trial to indicate that portions of this allocution are
3 either not reliable or at least phrased in a way which
4 would be misleading. So they can be misinterpreted by the
5 jury if they heard it. There is nothing in the allocution
6 which Mr. Maxes says he agreed with anybody, but there are
7 statements there that he had pitch sheets which were --
8 which he followed sales scripts known as pitch and
9 objection sheets which was usually prepared by Bruce
10 Gordon and there is certainly evidence in the record that
11 Bruce Gordon prepared pitch sheets and those pitch sheets
12 were utilized by salespeople. But then in going on saying
13 that he repeated -- he said that they contained false
14 statements which I repeated to potential customers.
15 Okay.
16 Then he says that they were regarding the nature,
17 quality and value of the memberships sold. He goes on to
18 make various mis -- to recite what some of the
19 misrepresentations were. Some of the things he said were
20 in the pitch sheets as have been introduced in evidence
21 here. Others were not. He says that he made -- he
22 falsely advised potential customers that Who's Who
23 Worldwide had successful networking seminars and 24 conferences in Japan,
Hilton Head, Vietnam, and there is 25 no pitch sheet that says that.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7277
1 I will not go through the others but there are
2 other ones here which represent he himself was making a
3 misrepresentation that is not in there. If you read that
4 allocution it can be read to say these things were in
5 pitch sheets which is not the case.
6 THE COURT: I would like to get my copy of the
7 letter that Mr. White wrote which is on my desk. I'll be
8 right out.
9 (Pause in proceedings.)
10 THE COURT: Have we concluded the defense
11 arguments?
12 MR. NELSON: If I might complete the thought I
13 was suggesting to the Court. The information is
14 3500-18-H, and paragraph 5 of the information states "on
15 or about and between January 1, 1989 and March 30, 1985,
16 both dates being approxima
te and inclusive within the
17 Eastern District of New York and elsewhere, the defendant
18 Michael Maxes, together with others did knowingly and
19 intentionally conspire to devise a scheme and artifice to
20 defraud and to obtain money and property from potential
21 customers of Who's Who Worldwide and Sterling Who's Who by
22 means of false and fraudulent pretenses, representations
23 and promises and for the purpose of executing such a 24 scheme and artifice to place and receive items through the 25 United States mail in violation of 18 U.S. Code Section
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7278
1 1341."
2 I would submit to the Court that that would more
3 than suffice for the purposes of establishing what the
4 government claims the only relevant portion for the
5 admissibility of this allocution is and that is in order
6 to
establish the existence of a conspiracy. The
7 underlying factual statements that are written by the
8 government for Mr. Maxes I would submit as already
9 propounded by Mr. Trabulus, it's prejudicial effect far
10 outweighs its probative value and for that reason in the
11 Court's discretion it should limit the admissibility if it
12 should be admitted at all to such a statement.
13 MR. LEE: Judge, I would like to say something.
14 Judge, I would like to add on to what Mr. Trabulus stated
15 as far as whether or not the allocution actually is
16 probative of what it is being admitted for and that is as
17 to the existence of a conspiracy. I'm asking Your Honor
18 to make a distinction between Mr. Gordon and the
19 salespeople because Mr. Trabulus' point is valid but I
20 believe Mr. Gordon may be mentioned by name and there may
21 be more factual content as to Mr. Gordon, but
as to the
22 salespeople it is even an additional step removed and more
23 remote in terms of its probative value as to the existence 24 of a conspiracy. So I'm saying that Mr. Trabulus' 25 argument is valid but it is even more compelling in a case
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7279
1 of the salespeople.
2 Also I think Your Honor should be reminded. I
3 don't know if you were or were not aware of the history
4 between Mr. Maxes and Mr. Gordon at the time of the plea
5 allocution. As I recall and I think the 3500 material
6 corroborates it. One, Mr. Maxes had admitted to Inspector
7 Biegelman that he had perjured himself in his testimony in
8 the Reed Elsevier litigation. I think that gives a basis
9 for Your Honor to suspect and to distrust the reliability
10 of his allocution because also he was also fired by Bruce
11 Gor
don and as I understand it and the government may be
12 able to shed some light, he had hostility against Bruce
13 Gordon because he had contemplated bringing an age
14 discrimination suit against Mr. Gordon and Who's Who
15 Worldwide which would certainly make his allocution
16 untrustworthy and had consulted a law firm and at the time
17 of his allocution with all of this surrounding
18 circumstances which is in addition to his knowing that he
19 was dying, this may be an allocution made in
20 vindictiveness. He may, without trying to be dramatic
21 trying to slashing out at Mr. Gordon from his grave with
22 this statement, it was made at the time of the hostile
23 hearing between Mr. Gordon and Worldwide Who's Who and it 24 is very untrustworthy and unreliable. 25 THE COURT: All right. What say you, Mr. White?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
7280
1 MR. WHITE: I say a couple things, Your Honor.
2 First, let me address these points in order.
3 Mr. Trabulus tried to suggest that this
4 allocution wasn't reliable because the government is the
5 one that typed up the statement that Mr. Maxes read.
6 THE COURT: I wouldn't spend too much time on
7 that.
8 MR. WHITE: That wasn't any secret. Your Honor
9 allocuted him all about it and he said all of these
10 words. Frequently throughout the trial Your Honor says
11 let's talk like technicians. So let's talk like
12 technicians.
13 All of their arguments about whether or not this
14 is reliable has to do with, I mean, has to do with what
15 Maxes other motives were or what he did in the past,
16 whether he had some vendetta against Mr. Gordon. That
17 might be relevant if we weren't talking about a plea
18 allocution where he's inculpat
ing himself or he's putting
19 himself in the soup, so to speak. If you look at the
20 case. Mr. Nelson tried to distinguish it but that Scopo
21 case says in essence even if he thought he was going to
22 get fined, that's good enough, exposing himself to some
23 penalty. 24 THE COURT: But if he thought he would die before 25 anything, it would not be against penal interest, would
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7281
1 it?
2 MR. WHITE: That's true. But number one, there
3 is no evidence that that's the case.
4 THE COURT: There is evidence. He said that he
5 had cancer and had just been operated on for cancer and
6 had taken chemotherapy and that was before me. There was
7 definitely circumstantial evidence. We know that cancer
8 is definitely a terminal illness, unfortunately. He was
9 operated on, taking chemotherap
y, he could hardly stand up
10 which I put in the record. So where is it against his
11 penal interest to plead guilty if he's going to die?
12 MR. WHITE: Well, Your Honor --
13 THE COURT: What consequences could there be that
14 would be against his penal interest to plead to this
15 thing?
16 MR. WHITE: Your Honor, you could just as easily
17 say the opposite which is if he knows he's going to die,
18 why would he expose himself to that?
19 THE COURT: To stop all the fuss about a trial,
20 to not be brought into court, to have peace and quiet to
21 the extent he had it, and to be -- to get at Mr. Gordon
22 who he was fired by and which there is evidence that he
23 was vindictive with respect to Mr. Gordon. 24 MR. WHITE: Well, I'm not sure that there was 25 evidence that he was vindictive.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7282
1 THE COURT: Wasn't he fired?
2 MR. WHITE: Yes.
3 THE COURT: Did he perjure himself in the Reed
4 case?
5 MR. WHITE: Yes, but that's not vindicative.
6 THE COURT: That's another element. Then it's
7 not the usual trustworthiness. I have a bigger problem
8 than all of that, however. The biggest problem is
9 somewhere in your excellent letter of March 9th which says
10 repeatedly that this evidence under 804(b)(3) is a
11 statement against interest where the declarant is
12 unavailable in order to prove the existence of a
13 conspiracy. It isn't admissible to show that any
14 defendant is guilty of mail fraud. It is solely,
15 according to these cases --
16 MR. WHITE: Right.
17 THE COURT: -- It is solely -- in fact, you have
18 to give a curative charge according to the Second Circuit
19 that this is not against any defendant. This
is -- and it
20 doesn't prove that any defendant knowingly and willfully
21 entered into a conspiracy. That's what the cases say. It
22 only is proof of a conspiracy. That's what the cases seem
23 to say. 24 Now, where in this allocution is there any 25 evidence that he was part of a conspiracy?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7283
1 MR. WHITE: Your Honor, he says, I believe, he was
2 employed as a member of the sales staff. That's on page
3 30.
4 THE COURT: You know, it probably was my fault in
5 that I let him get away with this pat, in reading this
6 allocution. I almost always say "did you agree with
7 anyone else to do this?" And I didn't do it because he
8 gave this long dissertation, it threw me off which is not
9 good for you because normally I would say "this is a
10 conspiracy charge. Did you agree with any
one else to do
11 this? Who did you agree with?" That's my normal
12 practice. I didn't do it here. Where is the evidence of
13 a conspiracy?
14 MR. WHITE: I think, Your Honor, he doesn't -- he
15 need not explicitly agree with someone else for it to be a
16 conspiracy. If he's acting in concert --
17 THE COURT: No, Mr. White, don't give me the
18 law. I'm now talking about an allocution.
19 MR. WHITE: Right.
20 THE COURT: Invariably I will ask in a conspiracy
21 charge, you agreed with someone else? And he will say,
22 yes. Who is it? It's either an unknown person they don't
23 want to state because there is cooperation or they will 24 name the person. I didn't do it here and you didn't do it 25 here. So nobody did it.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7284
1 MR. WHITE: Well, Your Honor asked me to refer to
2
the parts I think establish that.
3 THE COURT: Yes, tell me where.
4 MR. WHITE: He says on page 30, that he was
5 employed as a member of the sales staff at Who's Who.
6 That's line 15. He then described on the top of the next
7 page at 31, page 31 at line 3, that as a member of the
8 sales staff he telephoned potential customers. And then
9 he says during those calls I followed scripts which were
10 prepared by Mr. Gordon. And then he recounted those
11 scripts contain false statements.
12 THE COURT: But first of all, that is cumulative
13 14 times removed. We know that that's in the case. And I
14 don't know what that adds to a conspiracy by him enough to
15 get in a declaration against penal interest where he
16 doesn't allocute to a conspiracy, in my opinion, which is
17 the only thing that it could be admissible for. So you
18 have a lot of problems with getting
that in, in my
19 opinion.
20 This is -- every case is an interesting,
21 different case that is separate and apart from every other
22 case and this one is. Here you have a man who probably
23 was dying of cancer when he allocated. That's an 24 interesting situation. That's not the Scopo and that's 25 not in the other cases. And number two, there is no
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7285
1 allocution as to a conspiracy, in my opinion. You may
2 disagree, but I don't think so. Number three, he has a
3 problem with Mr. Gordon. He was fired by the company and
4 it isn't the same kind of situation as somebody who is a
5 healthy person who is facing jail and allocuting his
6 declaration against penal interest. So I have a problem
7 with it and when I have a problem with it you'll not get
8 it in.
9 MR. WHITE: Maybe I c
an take a shot at
10 ameliorating those problems.
11 With respect to the first one about whether or
12 not he allocutes to a conspiracy, did Your Honor ask him
13 did you agree with someone? No, obviously you didn't, but
14 he says in essence that he acted in concert with
15 Mr. Gordon at a minimum, the other people, members of the
16 sales staff at Who's Who following scripts that contained
17 falsehoods.
18 Now, is that as clear as maybe it typically is
19 when you were pleading to a conspiracy? Maybe not, but it
20 still makes out a conspiracy. What he pled guilty to was
21 a conspiracy to commit mail fraud. Would it be better if
22 it were more explicit? Yes, but he's clearly suggesting I
23 did this with other people. I followed scripts written 24 for me by someone else. It's implicit in that that he's 25 conspiring.
OWEN M. WICKER, RPR OFFICIA
L COURT REPORTER 7286
1 With respect to the second part, whether or not
2 he thought he was dying, my understanding was that he did
3 not. Now, --
4 THE COURT: He did not what?
5 MR. WHITE: He did not think he was dying. As a
6 matter of fact --
7 THE COURT: I hope he didn't.
8 MR. WHITE: Well, that's the whole issue here
9 though. If you remember he expected at the time of his
10 sentencing, his attorney specifically raises it, that Your
11 Honor, I told Mr. Maxes that his health could be an issue,
12 potential departure ground, when he's sentenced. So he
13 thinks he's going to be around for sentencing.
14 I mean, if that's one of Your Honor's objections
15 I'll try to get his lawyer here who could testify about
16 his conversation with Mr. Maxes, that Mr. Maxes expected
17 to be around at his sentencing.
18 THE COURT: Perhaps
he wasn't told how sick he
19 was, but you say that that makes it against his penal
20 interest.
21 MR. WHITE: That's exactly the point. If he
22 wasn't told and expected to be around he would have no
23 reason to think he wouldn't be around. 24 THE COURT: You may be able to get his lawyer in 25 but you are not able to get around the conspiracy. It is
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7287
1 not sufficient for me to let it go to the jury and say
2 this is proof of a conspiracy. That's what this is being
3 offered for. Why should I say that when it's not in
4 there? It's a very important point in this case. You're
5 evidence of conspiracy is extremely weak, extremely weak.
6 But of course I'm not saying I'm ruling on it at this
7 point. We know that there's very rarely direct evidence
8 of an agreement, but even in the weak cons
piracy cases,
9 your's is weak.
10 MR. WHITE: Your Honor, I understand that, but
11 the whole theory --
12 THE COURT: And for me to allow you to put this
13 in, when in my opinion there is insufficient evidence of
14 conspiracy, number one. And number two, the man was
15 probably dying of cancer which dilutes the statement
16 against penal interest, and to put such a thing in and
17 tell the jury, which I have to tell them, this is evidence
18 that there was a conspiracy, I'm not prepared to do that.
19 MR. WHITE: You just have to tell them that it's
20 evidence that they can consider in deciding whether or not
21 there was a conspiracy.
22 THE COURT: I'm not prepared to do that,
23 Mr. White. 24 MR. WHITE: Your Honor, I guess what I don't 25 understand is both in this trial and as well as with
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
7288
1 Mr. Maxes, obviously we're not going to have an explicit
2 agreement as Your Honor said. That hardly ever exists.
3 What you have is the operation of a business where people
4 have specific roles and they follow them and they act in
5 concert. It seems to me, I don't want to just repeat
6 myself, but Mr. Maxes is saying I acted in concert with at
7 a minimum Mr. Gordon.
8 THE COURT: I'll think about it overnight but my
9 inclination is not to allow it in. The most I would ever
10 do is what Mr. Nelson suggested by reading that part of
11 the information. That's the most I would do. I would
12 never let this allocution in.
13 MR. WHITE: Your Honor, --
14 THE COURT: I think Judge Keenan's idea was a
15 good one, especially in a very questionable situation like
16 this and it is questionable in every element. So I will
17 think about it
overnight, but you have my drift, spin,
18 what is the new language, drift, I think. You have my
19 thinking in the matter. I do not propose to let it in.
20 The most I would consider, and that I'm not sure about, is
21 the information, that portion of the information.
22 MR. WHITE: Okay. Then left me shift to plan B
23 then and talk about the information. 24 The information to which he pled guilty clearly 25 sets out a conspiracy. There is no doubt about that.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7289
1 That's clearly sufficient to prove the existence of a
2 conspiracy.
3 THE COURT: I'll have to read the two cases.
4 Where is the citation of Lopez?
5 MR. NELSON: There was no written decision on it.
6 THE COURT: How do you know he did it?
7 MR. NELSON: Because I was the trial attorney.
8 THE COURT: Is it in Muynet?
9 MR. NELSON: I believe it is. That's what Judge
10 Keenan painted towards.
11 THE COURT: I'll look at it.
12 MR. WHITE: I would suggest if that's the case
13 and we're just talking about the information, it should be
14 more than just the charging language because that doesn't
15 describe the conspiracy to which he pled guilty.
16 THE COURT: That's exactly right.
17 MR. WHITE: Well, then --
18 THE COURT: I don't know if I'll do even that.
19 MR. WHITE: That drift is certainly clear, Your
20 Honor. But I guess my point is if that is admissible, it
21 seems to me like if we are going to give the jury some
22 basis from which to infer the existence of a conspiracy,
23 they have to have a description of, well, what did the guy 24 plead guilty to? 25 THE COURT: No, they have to have proof beyond a
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER
7290
1 reasonable doubt. That's what they have to have.
2 MR. WHITE: No -- obviously.
3 THE COURT: That's what they have to have and
4 that's what troubles me.
5 MR. WHITE: I'm sorry. With respect to this --
6 THE COURT: With respect to the conspiracy. It's
7 weak. It's very weak. And if it wasn't for a few of
8 these cases, like Regent and other cases which set forth
9 the law in the Second Circuit which I've tried to read
10 over and over again to make sure what they're talking
11 about, you have a very close question here and I don't
12 think you have a statement against penal interest
13 sufficient to go in with this whole allocution, that's
14 what I'm almost sure of.
15 I'll read the other case and see how Judge Keenan
16 handled it and that seemed to make sense to me. He pled
17 guilty to conspiracy to commit mail fraud, period. That's
18 it.
19 MR. WHITE: Your Honor, I mean, I can't argue
20 with you.
21 THE COURT: You certainly can and have.
22 MR. WHITE: All I'm saying is --
23 THE COURT: And still are. 24 MR. WHITE: I mean, I don't mean to prolong 25 this. All I'm saying is if we get to the point where
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7291
1 we're going to put that in that we reached a conclusion
2 that that part of the information is sufficiently
3 probative that it should go in, it should be clear what
4 conspiracy he's pleading guilty to beyond just a
5 conspiracy to commit mail fraud.
6 For example, they have to consider that as
7 evidence of whether or not the conspiracy in the
8 superseding indictment here existed. So they -- it should
9 be clear to them that what he pled guilty to wasn't a
10 different mail fraud scheme at
Who's Who Worldwide but the
11 one we are talking about here.
12 THE COURT: There's no proof of any other
13 conspiracy to commit mail fraud, only this one.
14 MR. WHITE: I guess what I'm saying is they
15 should have a description of what he pled guilty to beyond
16 just the charging language, otherwise it doesn't make any
17 sense to them.
18 THE COURT: Then it will not make any sense.
19 MR. WHITE: I don't think we should be
20 needlessly --
21 THE COURT: Then we'll not put it in at all.
22 MR. WHITE: Well, I don't want to go that far.
23 THE COURT: Mr. White, you've had my thinking in 24 the matter. It is an unusual case of a man who has just 25 been operated from cancer, who is under active
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7292
1 chemotherapy, who dies within six months of the plea and
2 who couldn't sta
nd up practically, and I recall it now, at
3 the time of the allocution. Is that against penal
4 interest? Another way to look at it is let's get through
5 with this so it doesn't bother me anymore. I don't want
6 to go to trial. I don't want to be named in anything.
7 MR. WHITE: Your Honor --
8 THE COURT: I don't want to spend any more money.
9 MR. WHITE: On that point, Your Honor, he -- I
10 don't think that that reasoning is correct for this
11 reason. He signed a cooperation agreement.
12 THE COURT: That even dilutes even more. Whoever
13 said that, I think it was Mr. Trabulus. No, Mr. Nelson.
14 That dilutes against penal interest even more because now
15 he's not only not going to go to jail but he's
16 cooperating. He's definitely not going to go to jail.
17 MR. WHITE: Your Honor, the Scopo case says that
18 is not the case. In terms of whether or not he thinks
he
19 will die --
20 THE COURT: He will get a fine. Is that what
21 Scopo says?
22 MR. WHITE: It actually says what the defendant's
23 unilateral belief is doesn't make a difference, period. 24 But as to whether or not he's just pleading because he 25 thinks --
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7293
1 THE COURT: He didn't allocute to a conspiracy to
2 begin with. It was a bad allocution. I shouldn't have
3 accepted it. That's another reason. I just thought of
4 that.
5 MR. WHITE: I'm just trying to deal with the
6 issues one at a time.
7 THE COURT: Well, I'm giving you another one.
8 There's no proof -- well, it was the final one.
9 Mr. White, unless you have something additional
10 you want to tell me, I want to close this now. It is now
11 five minutes to 6 o'clock and I think the court reporter
12 wants to go home. So do you have anything -- not that I
13 want to go home, I'm not, but the court reporter might.
14 MR. WHITE: I don't know if it will change Your
15 Honor's mind but the only new thing is with respect to
16 whether or not he's pleading simply to get it over with
17 because he thinks he will die, he signed a cooperation
18 agreement in June of '96, a whole year before in which he
19 agrees to plead guilty.
20 THE COURT: When did he have the operation for
21 cancer?
22 MR. WHITE: I think he had it, I think within a
23 few months before the plea. 24 THE COURT: That's after the cooperation 25 agreement.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7294
1 MR. WHITE: Correct. But I'm saying it's not
2 like the cancer inspired a desire to plead guilty because
3 although I'm going to die anyway, he agreed to
plead
4 guilty before he had cancer.
5 THE COURT: The cancer inspired the plea, to get
6 it over with and to stop, so he could devote the rest of
7 his life to trying to get better, maybe, and not worry
8 about this case.
9 MR. WHITE: Well, I mean as a factual matter --
10 THE COURT: It could be.
11 MR. WHITE: As a factual matter that's not what
12 happened. The plea was scheduled at the time it was
13 because of my schedule, not his. We can speculate about
14 it.
15 THE COURT: Well, anything else? I don't have to
16 speculate the fact that he was just operated on for
17 cancer, had chemotherapy and died within six months. I
18 don't have to speculate on that.
19 MR. WHITE: I don't have anything new to add
20 except there was another issue that we also needed to
21 decide. I don't mean to keep Mr. Wicker here but it had
22 to do with the adm
issability of these tapes about whether
23 or not the statements on them were corporate admissions on 24 them. If they are we can put them in before we rest, but 25 we should settle it.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7295
1 THE COURT: What is the problem?
2 MR. TRABULUS: We might discuss this tomorrow.
3 Frankly, we are taken by surprise by the fact that the
4 government is going to be resting tomorrow morning. We've
5 not been given to understand that there are numerous
6 witnesses who were on the lists who the government is
7 apparently not calling. I don't think, among those
8 defendants who intend to put on the case, I don't think
9 the defendant will have a live witness tomorrow. We might
10 be able to play some tapes and so forth.
11 THE COURT: Have the defendants come to an
12 understanding or do they wish to state wh
ether they will
13 put -- whether anybody will put a case in?
14 You will have to decide starting tomorrow.
15 MR. SCHOER: Judge, I'm prepared to play some
16 tapes tomorrow, the one I've submitted a transcript on. I
17 imagine that would take an hour or so, maybe an hour
18 and-a-half.
19 MR. TRABULUS: I had Sandra Barnes subpoenaed, if
20 Your Honor recalled and Your Honor has signed another
21 subpoena and there are some things that I'll be putting in
22 evidence.
23 THE COURT: Is anybody going to put any witnesses 24 on? Do they know that now? 25 MR. TRABULUS: I expect to.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7296
1 MR. WALLENSTEIN: Judge, I expect to also but I'm
2 not prepared to do so tomorrow.
3 THE COURT: So you would be prepared to do so on
4 Wednesday.
5 MR. TRABULUS: I'll try to get a witness
here on
6 Wednesday.
7 THE COURT: You will have to, whether you are
8 prepared or not.
9 MR. TRABULUS: Okay.
10 THE COURT: We'll do what we can tomorrow, finish
11 the government's case and then we'll have to have
12 motions. Then we'll put the tapes on and then you can
13 start your case on Wednesday.
14 How long do you think the case will take?
15 MR. TRABULUS: I can't speak for how long it will
16 be with Sandra Barnes because there are a bunch of
17 documents that will be delivered Wednesday afternoon. But
18 that probably will not be more than a couple hours with
19 her. Then I have some other, at least in terms as I see
20 it, I have other witnesses. I don't think they will be
21 tremendously long witnesses. It was what Your Honor
22 signed a subpoena for.
23 THE COURT: So you will be putting in a case. 24 MR. TRABULUS: Yes.
25 THE COURT: Any others?
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7297
1 MR. NELSON: I have approximately an hour's worth
2 of tapes too.
3 MR. TRABULUS: Seeking to introduce transcripts.
4 MR. WALLENSTEIN: I probably have a day's worth
5 of a case, maybe more.
6 THE COURT: That should complete the case this
7 week. We should have summations and charge next week.
8 MR. WALLENSTEIN: Assuming the government doesn't
9 have any rebuttal.
10 THE COURT: That's true.
11 MR. TRABULUS: The subpoena Your Honor signed
12 last week was made returnable next Monday. I will try to
13 call Mr. Bailey and get Sandra Barnes on Thursday.
14 THE COURT: These tape-recordings you say you
15 want to put in, Mr. White?
16 MR. WHITE: Yes.
17 THE COURT: What are they?
18 MR. WHITE: There's three recordings, there are
19 con
versations between one or two Who's Who Worldwide
20 employees and an informant. In them, just to describe it
21 in a summary fashion, the employees indicate a knowledge
22 of the fraudulent nature of the sales operation at Who's
23 Who Worldwide. And the government would submit that there 24 are corporate admissions. The defendant's corporation is 25 a defendant. In acknowledgment by one of its agents in
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7298
1 the scope of its employment that this is a fraud, is
2 certainly probative of the corporate's intent which is
3 somebody we have to prove.
4 My understanding there is not any dispute that,
5 A, these are corporate employees and, B, that they are
6 employed there at the time because the informant is making
7 the tapes at Who's Who. And it is clear from the tapes,
8 it is clear that they are sales
people and they are
9 talking about the sales operation. I don't think any of
10 those facts are disputed. The question is just whether or
11 not the tapes and what they say constitute corporate
12 admissions. And it was the government's position pretrial
13 that they were and the defense --
14 THE COURT: Why wouldn't they be corporate
15 admissions? Haven't we had a slue of those admissions at
16 the trial?
17 MR. WHITE: I think so, but the defendant wanted
18 to argue it.
19 MR. TRABULUS: Many of them are not factual
20 statements. They are just saying I'm scamming to make
21 money for somebody who is even a bigger scam artist. They
22 are just kind of conclusions like that, muttering, but
23 something that would be considered idle chatter among 24 co-conspirators if there was a conspiracy. 25 But on top of that, there has to be an admission
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7299
1 to a third-party. It has to be somebody outside, the
2 person making the admission. This is internal muttering
3 to the corporation, saying something to yourself, you have
4 one person who is a corporate employee saying something to
5 another person who is in a corporate place.
6 THE COURT: Why not to an individual?
7 MR. TRABULUS: How could somebody admit something
8 to themselves.
9 THE COURT: They can admit to something by
10 talking to a fellow employee.
11 MR. TRABULUS: Perhaps it would be an admission
12 against them, but as to the corporation would it not have
13 to be someone on the outside?
14 THE COURT: I don't think so. I don't think so.
15 In any event --
16 MR. SCHOER: Judge, so the facts are clear, these
17 are not conversations which are being conducted during the
18 course of the business day. These are conversations in
19 the lunch room or in the bathroom. It's really idle
20 chatter and they are opinions, not facts.
21 THE COURT: I'll have to see them or hear them
22 myself and I'm not going to do it now. But tomorrow we'll
23 have an opportunity to do it. 24 MS. SCOTT: Your Honor, may I add that idle 25 chatter is relevant to a consideration whether a statement
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7300
1 is in furtherance of a conspiracy. It is not considered
2 in the corporate administration context. You only see it
3 discussed in cases considering statements offered under
4 801(d)(2)(E) and we're looking at 801(d)(2)(D).
5 THE COURT: Which are regular admissions.
6 MS. SCOTT: Corporate admissions.
7 THE COURT: Idle chatter in the context of Title
8 7 civil cases, not most of the
time. However, I'll rule
9 on it when I listen to it or read it.
10 We'll recess until 9:30 tomorrow. I'll tell the
11 jurors when you rest I'm going to give them some idea
12 about how long the case will be. So you better have some
13 idea, if you want me to tell them that.
14 MR. WHITE: I just want to raise two issues. One
15 is I recall from the discussion last week here with
16 Mr. Bailey that Ms. Barnes is out of town somewhere and
17 she is on call to come here. I also recall that I think
18 when you signed that subpoena for her you indicated to
19 Mr. Trabulus that he will have to show you some law as to
20 how that testimony and those documents would be
21 admissible. Basically, as I understand it, what they are
22 trying to say, everybody does it, everybody uses mailing
23 lists saying that they are nominated. I don't care about 24 Ms. Barnes, I suggest we ad
dress that issue whether it is 25 admissible at all before she flies here.
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7301
1 THE COURT: Well, have you got any law on that,
2 Mr. Trabulus?
3 MR. TRABULUS: Not yet, Your Honor.
4 THE COURT: I mean, the time is coming.
5 MR. TRABULUS: I understand that, Your Honor. I
6 did some research on it and I couldn't find any cases
7 directly on point, Your Honor, but there may be other
8 things she may testify to that may also be relevant in
9 this case, I believe.
10 THE COURT: Such as what?
11 MR. TRABULUS: She wrote a letter, she was in
12 touch with Mr. Bailey, asking Mr. Bailey that he try to
13 have the mail withheld. There will be evidence that the
14 mail was withheld. There will be evidence that the mail
15 was withheld right at about -- that the withholding of the
16 mail
or the decrease in the volume of mail that the
17 company got -- which the companies got, which later on
18 after the raid they got a lot of old mail dated from this
19 time period. This came around at the same time that the
20 informants were making telephone calls trying to get
21 supposedly some members, even if they weren't qualified.
22 That basically -- I'm going to argue, Your Honor, and I
23 think the evidence will show that there was an attempt on 24 the part of Inspector Biegelman, at least 25 circumstantially, it looks like that, to worsen the
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7302
1 condition of the company so as to create a problem there
2 and a lack of business which might induce the salespeople
3 to offer memberships to people who otherwise might have
4 not been offered memberships.
5 At one point, according to Mr. Watst
ein, after he
6 first started making phone calls, sometime into it, he was
7 told by Inspector Biegelman, well, start now, start
8 pretending to be people who would be less qualified, pizza
9 parlor owners and stuff like that. Right around that time
10 the mails at Who's Who Worldwide stopped getting the
11 number of responses.
12 THE COURT: How will you prove that Inspector
13 Biegelman, Inspector Biegelman had anything to do with
14 that?
15 MR. TRABULUS: Well, he did ask for a mail cover
16 to be held. There was a mail cover.
17 THE COURT: What is a mail cover?
18 MR. TRABULUS: A mail cover is something where
19 there was neither supposed to be taken of all the people
20 sending mail to Who's Who Worldwide and Sterling by postal
21 people -- the postal people will say they were instructed
22 not to hold it up.
23 THE COURT: Then how will you prove
it was held 24 up? 25 MR. TRABULUS: Well, we'll prove it was held up
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7303
1 because we'll have witnesses that will say come the summer
2 of 1996 when they tried to get Who's Who back on track and
3 -- excuse me, 1995, not '96. All of a sudden large
4 volumes of mail showed up with postmarks around January
5 1995, February 1995, maybe December 1994 which would
6 indicate this mail all of a sudden showed up which
7 suggested it was held up.
8 MR. WHITE: Your Honor, we went through all of
9 this with Magistrate Pohorelsky. He heard two weeks of
10 testimony on this from Inspector Biegelman, about mail
11 covers, about he heard from the two post office employees
12 at Lake Success.
13 I mean, all of this, it's a complete sideshow.
14 It has nothing to do with whether or not there is a fra
ud
15 here. What Mr. Trabulus is talking about happened after
16 the date.
17 THE COURT: Yes, it's very tenuous, Mr. Trabulus.
18 MR. TRABULUS: Your Honor --
19 THE COURT: I don't see it.
20 MR. TRABULUS: I think in fact it is not a
21 sideshow because they have introduced all of these tapes
22 to show that these salespeople would have given positions,
23 given memberships to people who were pizza parlor owners 24 or something of the sort and that was happening at the 25 time when there were other records, cards were short, you
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7304
1 have tapes saying that. To the extent that may have
2 happened the salespeople to meet quota or to make sales
3 might have been offering things to people they might not
4 have otherwise done it.
5 THE COURT: If that is a defense put it in.
6 MR.
TRABULUS: Well, part of what Sandra Barnes
7 would say could bear on that.
8 THE COURT: That's your defense that they did
9 that out of desperation.
10 MR. TRABULUS: That's not the issue.
11 THE COURT: I don't know what the defense is
12 then.
13 MR. TRABULUS: Well, the defense is there is no
14 crime, Your Honor, and in this particular thing the
15 government was at least responsible for some of their own
16 evidence which they are relying on showing criminal
17 activity.
18 THE COURT: I think that is too tenuous,
19 Mr. Trabulus. Now, you can show any reason why the
20 salespeople did these things, as I said because they were
21 -- they didn't have many leads. You can attempt to show
22 that. I'll let you do that but you can't show that the
23 government intentionally held up the mail unless you prove 24 it. 25 MR. TRABULUS: We can show th
at there was a mail
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7305
1 cover.
2 THE COURT: Or at least not prove it but bring in
3 some evidence. You don't have to prove anything. You
4 have to show some evidence of this before you can say
5 that.
6 MR. TRABULUS: We can have evidence and there was
7 a mail cover induced by the government, that was not
8 disputed.
9 MR. WHITE: The mail cover didn't hold up
10 anything. Magistrate Pohorelsky heard the testimony and
11 concluded it did not. He also concluded affirmatively
12 that the postal inspectors were not involved in holding up
13 the mail.
14 THE COURT: Well, do you mean to say now they
15 can't bring that into this trial?
16 MR. WHITE: I'm saying, Your Honor, it's not
17 proof of what Mr. Trabulus is saying.
18 THE COURT: But can they bring it in?
19 MR. WHITE: Bring in that there was --
20 THE COURT: They had such proof? Can't they
21 bring it in notwithstanding the hearing?
22 MR. WHITE: I would say that they could not
23 because of relevance. What does it prove? There was a 24 mail cover. 25 THE COURT: That's what I said. I don't think it
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7306
1 is relevant but I'll let them try to prove that as a
2 result of the government's interference it made the
3 salespeople desperate and that's why they did that, if
4 they want to go into that. I don't know if that's a
5 defense but it is an argument, I suppose. I really can't
6 prevent them from going into any possible defense.
7 MR. WHITE: All I'm saying, Your Honor, if it's
8 irrelevant, if we can determine now that their offer of
9 proof is irrelevant, will we be bringing in people and
10 objecting --
11 THE COURT: I told you. If they want to say they
12 were desperate, that's why they did it. They didn't
13 intend anything, their rent, their house was being
14 foreclosed, their rent was not being paid, the mortgage
15 was overdue, let them say that.
16 MR. WHITE: Okay. But, Your Honor, I guess my
17 point is that's not what -- that's not what they are
18 saying. They want to have it both ways. Their defense is
19 there wasn't a crime here.
20 THE COURT: That's their defense.
21 MR. WHITE: So therefore what they are offering
22 is to prove isn't what they really want to prove. All
23 they want to prove is some wild conspiracy. 24 THE COURT: I don't know what they want to prove 25 and they don't know what they are going to prove. I don't
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7307
1 know what story or
testimony they will bring in. I'll
2 wait and see.
3 MR. WHITE: I want to make sure I understand.
4 THE COURT: They will not start saying the
5 government did all of these things without some evidence
6 to that effect.
7 MR. WHITE: Okay. I just want to make sure I
8 understand this.
9 So they are -- suppose they call a witness in who
10 says -- I mean, I guess I'm not sure. How will they prove
11 there was a mail cover?
12 THE COURT: There's a what?
13 MR. WHITE: A mail cover.
14 THE COURT: I don't know.
15 MR. TRABULUS: Admissions by a party agent.
16 MR. WHITE: Namely?
17 MR. TRABULUS: Inspector Biegelman.
18 MR. WHITE: But I guess that's my point, Your
19 Honor. That we can determine right now whether or not --
20 THE COURT: No, I'm not going to determine
21 anything right now. I'm recessing right now.
22 9:30 tomorrow
morning.
23 MR. WHITE: Good night, Your Honor. 24 May I ask who the defense will expect to call the 25 day after next if they don't have anything tomorrow so I
OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7308
1 can prepare?
2 MR. TRABULUS: I'll tell you tomorrow. I have to
3 make some phone calls tonight to see who I can have
4 available.
5 THE COURT: They will give you a day's notice
6 just as you gave them the day's notice.
7 MR. TRABULUS: Can we have the first witness as a
8 surprise just like he did?
9 Keep it a surprise whether it is the tax case or
10 the fraud case.
11 (Proceedings adjourned.)
12 13 14 15 16 17 18 19 20 21 22
23 24 25 OWEN M. WICKER, RPR OFFICIAL COURT REPORTER 7309
1
2 INDEX
3
4
5 J O H N E. T A R D E R A................... 7052 DIRECT EXAMINATION................................... 7052 6 CROSS-EXAMINATION.................................... 7069 CROSS-EXAMINATION.................................... 7087 7 REDIRECT EXAMINATION................................. 7090
8 J O S E P H J O R D A N........................ 7091 DIRECT EXAMINATION................................... 7092 9 CROSS-EXAMINATION.................................... 7114 CROSS-EXAMINATION.................................... 7144 10 CROSS-EXAMINATION.................................... 7153 CROSS-EXAMINATION.................................... 7164 11 CROSS-EXAMINATION.................................... 7182 CROSS-EXAMINATION.................................... 7210 12 REDIRECT EXAMINATION................................. 7229 RECROSS-EXAMINATION.................................. 7240 13 RE
CROSS EXAMINATION.................................. 7247 RECROSS-EXAMINATION.................................. 7254 14 REDIRECT EXAMINATION................................. 7256 RECROSS-EXAMINATION.................................. 7257 15 RECROSS-EXAMINATION.................................. 7257
16 EXHIBITS 17
18 Government's Exhibit 1613 received in evidence....... 7043 Government's Exhibit 1614 received in evidence....... 7061 19 Government's Exhibit 811 received in evidence........ 7064
20 Defendant's Exhibit AU marked for ID................. 7082 Defendant's Exhibit AW received in evidence.......... 7169 21 Defendant's Exhibit AZ received in evidence.......... 7170 Defendant's Exhibit DA received in evidence.......... 7173 22
