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Harmless-Error Analysis Versus Plain-Error Analysis On Appellate Review


harmless-error analysis versus plain-error analysis

U.S. Courts of Appeals for the Second Circuit v. Groysman

2014 WL 4337798

Decided on: September 3, 2014

Substantial Rights Are Affected Where An Evidentiary Error Has An Injurious Affect Or Influence On The Jury’s Verdict

Blog By: Stephen N. Preziosi Esq., Criminal Appeals Lawyer

Issue: Whether the hearsay testimony, erroneously admitted by the trial court and un-objected to by Defense counsel, constituted plain error and whether or not the evidentiary errors in this case are subject to harmless error analysis.

Summary: The Government indicted Defendant Groysman on health care fraud conspiracy and money laundering conspiracy for submitting fraudulent claims to insurance companies. At trial, the Government presented special agent Ginzburg who had been involved in the health care fraud investigation but surrendered to the federal authorities and agreed to assist in the investigation.

Ginzburg testified that the company EGA would bill insurance companies for the items it claimed to have purchased at the prices shown on the invoices provided by the cooperators, and that the insurance companies would then reimburse EGA for durable material equipment (DME). Defendant’s objections that these exhibits were improperly being used as actual evidence rather than for purely illustrative purposes were overruled. She also claims that the charts were based on what the informants told Ginzburg, rather than on Ginzburg’s own personal knowledge or observations.

On Appeal, Groysman contends that Ginzburg’s testimony was replete with inadmissible hearsay.

Groysman concedes that some of her present objections to Ginzburg’s testimony were not made at trial. However, that the errors to which she did not previously object warrants reversal on the ground of plain error. The Court of Appeals for the Second Circuit concluded that, the standard for plain error review was met and required that Groysman be given a new trial.

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Holding: The Court of Appeals for the Second Circuit did not apply harmless error analysis and only applied plain error analysis, even though the burden of proof for plain error is on the Defendant. The Court found that the Defendant established all the factors under plain error analysis. There was error, it was plain and it affected substantial rights. The Court elected to entertain the unpreserved issue because the Prosecution’s trial tactics deeply undermined the confidence and fairness and outcome of the Defendant’s trial.

Facts: The Government indicted Defendant Groysman on health care fraud conspiracy and money laundering conspiracy for submitting fraudulent claims to insurance companies. Defendant was a part time worker at EGA group. At trial, the Government presented special agent Ginzburg who had been involved in the health care fraud investigation of the durable medical equipment (DME) but surrendered to the federal authorities and agreed to assist in the investigation. Ginzburg conducted an operation by having all conversations on the cooperators’ telephone lines recorded. The Government introduced transcripts of conversations between Defendant and another worker, as well as some videotapes of their meetings. Defendant’s defense was that she was a part time worker at EGA who had been following the direction of one of EGA’s owners without knowledge of the scheme or criminal intent to participate in it.

Ginzburg testified that he monitored the operation in part by meeting with the cooperators before and after their face-to-face meetings with the suspects, and by controlling the deposits of the checks, the withdrawal of cash, and the delivery of the cash to the Defendant. The only witnesses that had actual knowledge of what Defendant did were the informants and Ginzburg’s knowledge of what took place at those meetings came from what he could hear through the audio equipment.

Ginzburg testified that EGA would bill insurance companies for the items it claimed to have purchased at the prices shown on the invoices provided by the cooperators and that the insurance companies would then reimburse EGA for the DME. Defendat’s objections that these exhibits were improperly being used as actual evidence rather than for purely illustrative purposes were overruled. She also claims that the charts were based on what the informants told Ginzburg, rather than on Ginzburg’s own personal knowledge or observations.

In addition, a cooperator named Yuzovistkiy, whom Ginzburg testified was another partner in the scheme, testified that he had discussions with Groysman with regard to the cash deliveries. However, Yuzovitskiy testified that 99% of the time he delivered the cash to the owner and when questioned, he said he doesn’t remember that he gave cash directly to Defendant.

Groysman, in her defense, called her own witness Panchenko, a long time friend who had been a coworker at EGA. Panchencko testified that Groysman was not one of the owners and she had never seen Yuzovitski or Ginzburg give cash to Defendant.

The Government argues that the evidence demonstrated that Groysman knowingly entered into and participated in the fraudulent scheme alleged. Groysman was convicted on both counts.

On Appeal, Groysman contends that Ginzburg’s testimony was replete with inadmissible hearsay, as he recounted factual matter as to conduct Groysman that he could not have learned except from statements by the cooperators; that Ginzburg was improperly allowed to give his opinion as to Groysman’s culpability; that Ginzburg was allowed to give foundation testimony for the admission of documents as to whose accuracy he had no personal knowledge; and that seven charts introduced by the Government were not admissible under the Federal Rules of Evidence and were inaccurate and misleading. Groysman concedes that some of her present objections to Ginzburg’s testimony were not made at trial. However, that the errors to which she did not previously object warrants reversal on the ground of plain error. The Court of Appeals for the Second Circuit concluded that, the standard for plain error review was met and required that Groysman be given a new trial.

Legal Analysis: The Court of Appeals for the Second Circuit concluded that, given the serious impropriety of the Prosecution’s use of the witness in light of the record as a whole, met the standard for plain error review and require that Groysman be given a new trial.

Ab initio, the Court noted the distinction between harmless-error analysis and plain-error analysis. In conducting harmless-error analysis, applicable when an error claimed on appeal has been properly preserved in the District Court, the Court of Appeals considers 1) the overall strength of the Prosecutor’s case; 2) the Prosecutor’s conduct with respect to the improperly admitted evidence; 3) the importance of the wrongly admitted testimony; and 4) whether such evidence was cumulative of other properly admitted evidence. A conviction will be reversed on the basis of improperly admitted evidence only if it affects a substantial right. An evidentiary error affects substantial rights if it had a substantial and injurious affect or influence on the jury’s verdict. With respect to harmless-error analysis, the Government bears the burden of proof.

Under plain-error analysis, before an Appellate Court can correct an error not raised at trial, there must be 1) error, 2) that is plain and 3) that affects substantial rights. If all three conditions are met, an Appellate Court may then exercise its discretion to notice a forfeited error, but only if 4) the error seriously affected the fairness, integrity, or public reputation of judicial proceedings.

An error affects substantial rights when it is prejudicial—that is, when there is a reasonable probability that the error affected the outcome of the trial. United States v. Dominguez Benitez, 542 U.S. 74, 81-82, 124 S.C.t. 2333, 159 L.Ed. 157 2004. The burden of meeting these criteria for plain-error review is on the Defendant.

The Court of Appeals for the Second Circuit held in this case, given the numerous errors conceded by the Government and the fact that not all of them were the subject of objections by Defendant at trial, they elected to bypass harmless-error analysis and conducted only plain-error analysis notwithstanding that the burden under that analysis is on Defendant. The Court found that the Defendant had met her burden under plain-error analysis.

Defendant challenges 1) Ginzburg’s incorporation of hearsay from the cooperators who later testified at trial; 2) the inadequate foundation during his testimony for the admission of summary charts; and 3) Ginzburg’s inappropriate opinion testimony relating to her role in the charged fraudulent scheme.

First, to the extent that Ginzburg described what occurred at meetings inside EGA offices, he was conveying information that he learned from debriefing the cooperators and was thus conveying inadmissible hearsay.

Second, to the extent that Ginzburg interpreted recorded conversations involving the cooperators, he was providing inadmissible opinion testimony. Further, as counsel properly objected to all but one of the charts, Ginzburg had no personal knowledge of many of the matters conveyed on those exhibits.

The Court of Appeals for the Second Circuit held that compounding the lack of foundation for the admission of the summary exhibits, as counsel had further objected below, the exhibits contained inaccurate and misleading information rendering them inadmissible.

The Court of Appeals held that, the question is not whether the Defendant would more likely than not have received a different verdict; but whether she received a fair trial, understood as a trial resulting in a verdict worthy of confidence. A reasonable probability of a difference result is accordingly shown when the Government’s error undermines confidence in the outcome of the trial. Kyles v. Whitley, 514 U.S. 419, 434, 115 S.Ct. 1555, 131 L.Ed.2d 490 1995.

The Court of Appeals held that the Government’s entire strategy was dependent on, and tainted by, the egregious errors that the Government now admits. These errors infected the fairness of the trial that Groysman’s conviction would have been overturned.

The Court also notes that because the conversations among the cooperators and the targets of the investigation were conducted almost entirely in Russian, the jury was likely to accord special deference to Ginzburg’s interpretations of these conversations. When a case agent also functions as an expert for the Government, the Government confers upon him an aura of special reliability and trustworthiness, creating a risk of prejudice that increases when the witness has supervised the case. United States v. Dukagjini, 326 F.3d. The Court of Appeals held that their unease in this regard is heightened in this case by the facts that Ginzburg personally transcribed at least the final transcripts of the meetings. Ginzburg was allowed at trial, over objection, to give interpretations as to what Yuzovitiskiy and Groysman were discussing in Russian.

In sum, the Government had conceded that at Groysman’s trial there was a large number of erroneously admitted pieces of evidence inculpating her, including the many hearsay assertions by Ginzburg, the charts that were prepared on the basis of hearsay whose admission in evidence was not authorized by the rules of evidence and whose contents were misleading; and the impermissible opinion evidence from Ginzburg whose views were likely to be given substantial credence by reason of both his status as a law enforcement agent and his expertise in the language spoken by Groysman and the cooperators.

The Court of Appeals concluded that the evidentiary errors now conceded by the Government were serious and central to the prosecution’s strategy; as such, that they deeply undermined the confidence in the fairness and outcome of Defendant’s trial.

The Court of Appeals for the Second Circuit vacated the Defendant’s judgment and remanded the matter for a new trial.


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