filed: October 28, 1994; As Corrected November 4, 1994.
On Appeal from the United States District Court for the District of New Jersey (D.C. Criminal No. 89-00218-3).
Before: Greenberg, Roth, and Rosenn, Circuit Judges
GREENBERG, Circuit Judge.
This is an appeal from a final judgment of conviction and sentence entered by the United States District Court for the District of New Jersey on March 30, 1994. Richard O. Bertoli, the appellant, was convicted of obstruction of Justice and conspiracy to obstruct Justice, the third and sixth counts of a six-count indictment. On March 28, 1994, the district court sentenced Bertoli to a total term of 100 months imprisonment to be followed by two concurrent three-year terms of supervised release. In addition, the court imposed a $7 million fine. Bertoli appeals from both his sentence and his conviction. He contends that he is entitled to a new trial because: (1) the district court failed to inquire properly into whether premature jury deliberations prejudiced him; (2) the district court's method of conducting ex parte in camera interviews with certain jurors violated his constitutional and procedural rights; and (3) the district court improperly supplied the jury with written transcripts of certain testimony. Bertoli argues in the alternative that his sentence should be vacated because: (1) the district court applied the wrong version of the Sentencing Guidelines Manual, thereby violating his right to be free from ex post facto punishments; (2) the district court's calculation of the loss under the fraud guideline is not supported by the record; (3) the district court erred by upwardly departing to $7 million from the guidelines range fine of $125,000. Finally, Bertoli urges that if the case is remanded, it should be reassigned to a different Judge.
For reasons we explain in detail below, we will affirm the judgment of conviction but we will vacate the sentence. We decline to order that the case be reassigned to a different Judge, and therefore we will remand the matter to the district court for resentencing in accordance with this Opinion.
On September 29, 1989, a grand jury returned a six-count superseding indictment, charging Bertoli and two co-defendants, Richard Cannistraro and Leo Eisenberg, with violating RICO, 18 U.S.C. § 1961, et. seq., conspiracy to violate RICO, conspiracy to commit securities fraud, and three counts of obstruction of Justice. In January 1992, the grand jury returned a second superseding indictment, adding obstruction of Justice counts against Bertoli and Cannistraro, based on their alleged continuing efforts to hinder the criminal prosecution. Eisenberg eventually pled guilty to the RICO count of the first superseding indictment, and Cannistraro pled guilty to an information charging him with conspiracy to obstruct Justice. Bertoli thus became the sole remaining defendant.
Much of the substantive conduct described at the trial is not generally relevant to this appeal. However, certain evidence is -- evidence of conduct underlying Counts One and Two, which the district court termed the "stock manipulations schemes," and of conduct underlying Counts Three and Six, the counts of conviction.*fn1 Essentially, Bertoli and his co-conspirators were charged with unlawfully manipulating the prices of certain stocks. The scheme worked by creating artificial demand, which in turn artificially raised the price of the stocks. For example, Bertoli allocated units of certain initial public offerings of stock ("IPOs") to individuals and entities he controlled. Those players restricted the purchase and sale of the stocks in keeping with Bertoli's and Eisenberg's instructions, thus, essentially setting the price, creating a demand, and ensuring that the price rose. After the prices rose, Bertoli and the others sold their shares at a profit. Additionally, to raise the prices still further, Cannistraro, who was an analyst at the firm of Wood Gundy, Inc., attracted buyers by writing favorable reports about the IPOs.*fn2
The third count charged Bertoli with conspiracy to obstruct several criminal and civil investigations into his unlawful securities fraud. The count alleged that he conspired to obstruct: (1) an investigation conducted by the Securities and Exchange Commission ("SEC"), beginning in 1983, of fraudulent and manipulative trading of two stocks; (2) a civil action brought in 1985 by the SEC against Bertoli and others; (3) a 1985-86 grand jury investigation; (4) a 1987 prosecution against Cannistraro; and (5) the current action. The conspirators allegedly achieved their object by causing brokers and others to conceal evidence from the investigators and the grand jury. The count alleged 33 overt acts, consisting of telephone calls between the defendants and others, and false statements by the defendants. The count alleged that in furtherance of the conspiracy, the defendants destroyed documents relating to certain accounts, filed a false financial disclosure form with the United States Probation Office, transferred funds in the Cayman Islands, and knowingly submitted false affidavits during this prosecution. Count Six charged that Bertoli and others obstructed Justice by transferring certain proceeds of racketeering activity from the Cayman Islands to the Principality of Andorra in Europe, with the deliberate intent to hide their criminal activity and unlawful gains from the United States government.
The case against Bertoli was tried between June 1, 1993, and August 24, 1993. For the first seven weeks of trial, Bertoli was pro se ; thereafter, an attorney entered the case on his behalf. On August 24, 1993, the jury returned a verdict finding Bertoli guilty of one count of obstruction of Justice (Count Six) and one count of conspiracy to commit obstruction of Justice (Count Three). But the jury acquitted Bertoli on all other counts. Bertoli made a timely motion for a new trial, which the district court denied. On March 28, 1994, after the district court imposed the sentence, Bertoli timely filed his notice of appeal. We have jurisdiction pursuant to 28 U.S.C. § 1291 and 18 U.S.C. § 3742. The district court had jurisdiction pursuant to 18 U.S.C. § 3231. We will address the trial issues and the sentencing issues in turn.
1. Adequacy of court's inquiry into jury misconduct
Bertoli first contends that the trial court failed adequately to investigate whether premature jury deliberations prejudiced him. Bertoli moved for a mistrial on the issue; he also made a post-trial motion for a new trial. Both motions were denied.
On August 11, 1993, the court began reading the charge to the jury. During a recess, Juror Six informed the court that an alternate juror had engaged her in a premature, improper Discussion about the merits of the case. With counsel present, the juror was brought before the court, and the following colloquy ensued:
THE COURT: You mentioned to me as I was walking out that somebody mentioned to you an opinion about the case?
THE COURT: I don't want to know what it is. Has that affected your ability to be fair and impartial?
THE JUROR: I don't think so. In fact, I'm sure it has not.
App. at 675-76. The trial court procured from Juror Six the identity of the jurors who engaged her in the premature conversations. All three of them -- Jurors Thirteen, Fourteen and Fifteen -- were alternates. One at a time, the court summoned these alternate jurors to the courtroom for questioning by the court in the presence of counsel for both Bertoli and the government. The record reflects the following conversation between the court and Juror Thirteen:
THE COURT: The juror who was just out here indicated to me that you mentioned to her something about the case. I stress I did not ask her what it is, I do not know what it is, I don't want to know what it is.
I have instructed all the jury not to express or deliberate in any way in the case.
Have you mentioned anything to anybody else about the case?
THE JUROR: No, I haven't your Honor.
THE COURT: Again, you can't go into any detail.
I'm going to excuse you from deliberation. . . .
App. at 677-78. The court had nearly identical conversations with Jurors Fourteen and Fifteen. Both of the jurors denied discussing the case with any juror other than Juror Six and the court excused both from their responsibilities as well.
When the court concluded its voir dire, Bertoli moved for a mistrial or, alternatively, either that the court similarly question the other jurors or that Juror Six be excused. Stating that "she has expressed to me her ability to be fair and impartial and I'm satisfied she can be on that", the court denied the motions. App. at 680. Bertoli's counsel then requested the court to probe further into the intra-jury communications. The court reiterated its belief that the jury remained untainted, but agreed to "in camera ask each of them what they said and seal it, so the Circuit has it." App. at 687. During the next recess, the alternate jurors and Juror Six were called into the Judge's chambers for further interviews. Neither Bertoli nor his attorney was present for this second round of questioning.
The court first interviewed Juror Thirteen. Because Bertoli relies heavily on this conversation, we quote the transcript extensively:
THE COURT: Juror number six, Sheila, Miss Wheil, says that you mentioned something to her and that's what she mentioned to me and that's what I asked you about in court.
You're not a deliberating juror. From what I know, it's no big deal, but just to satisfy the attorneys out there, I'm putting it on the record. Don't be concerned.
Q: Did you express an opinion as to guilt or innocence?
A: No. That's why I was wondering why I was excused because --
Q: Everybody would have been excused anyway. We had all 12 jurors.
Please, don't be upset with me or the process.
First of all, let me say something. It's been an honor and privilege to be here. I realize this is the process. I have learned a lot, I really have. I learned a lot. It's been a privilege and I kind of feel violated about what happened today because --
Q: You know, don't, because from -- you were number 13. From number 13 to 20, you all knew that.
Q: You guys did yeomen work. . . .
Look, Miss Wheil just mentioned to me that you mentioned something to her about the case and I said, fine, I'll find out about it.
That's why I asked if you mentioned anything to anybody else. You said you didn't.
I just want to put it on the record so these attorneys have their record. It will be sealed.
If they want to use it, the Court of Appeals will look at it. It's no big deal as far as you're concerned. I'm just trying to maintain the integrity of the process.
Q: Please don't be upset with me.
A: No, but I would like to tell you what happened.
A: I pulled in the parking lot this morning, so I waited for her, to walk in the building together.
She says to me, she says, 'How in the hell does he think he's going to get away with this?'
I say to her, I says, 'What are you talking about? Get away with what?'
I says, 'Bertoli's innocent until he's proven guilty.'
A: I'm not going to go through the process of deliberating. But you have to look at all of the evidence before you can say the man is guilty.
Q: As you heard my instruction out in court, that's exactly what I told the jury.
A: This is what I told her this morning. I walked in the building and that's [sic] was it.
Your Honor, we don't even communicate. The only reason why I waited for her this morning was because I thought, well, I don't run into her very often, I'll wait for her just to be polite.
Q: Mr. Bowen, it's no big deal.
A: But, your Honor, I got a lot of questions I want to ask you.
Q: I told -- as a matter of fact, once the jurors begin deliberating, I'll bring all the alternates in and we can talk about the case. That's not a problem. I told you folks we would do that.
When the jury returns its verdicts, I'll sit down and chew the fat with them, too.
That's all I want to do right now is just clear this up. It's no big deal. There is no problem. I see absolutely no consideration.
A. But there is a problem. There is a problem.
A: The problem is with her because she's been expressing opinions all along in the trial. No one has communicated with her.
Q: Great. That's terrific. That's terrific.
A: She's the only one that has expressed an opinion and for the three of us to take the weight, this looks very bad.
You have to understand, I'm not assessing blame on anyone and the only reason I'm talking to you right now is just to ...