Beruflich Dokumente
Kultur Dokumente
4 v. 13 CV 6326(TPG)
6 Defendant.
7 ------------------------------x
8
January 7, 2014
9 2:51 p.m.
10
Before:
11
HON. THOMAS P. GRIESA,
12
District Judge
13
14 APPEARANCES
15 PREET BHARARA
United States Attorney for the
16 Southern District of New York
BY: PAUL MONTELEONI
17 CHRISTINE MAGDO
Assistant United States Attorneys
18
BAKER & HOSTETLER
19 Attorneys for Defendant
BY: MARK CYMROT
20 JOHN MOSCOW
21 BAKER BOTTS
Attorneys for Defendant
22 BY: SETH TAUBE
23
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8 defendants.
14 on.
23 transferring any and all assets that they have anywhere in the
24 world.
5 Prevezon in?
10 New York.
19 real estate around the world. He's about 40, in his early 40s,
16 business volume that was, but that that was an activity that
23 defendants deny that, but I'm going to put that aside and deal
24 with the money laundering issue, because once the money went
10 They don't have any allegations that they knew any members of
18 are major holes in that, and let me give you one example.
21 launder their funds. It's been six years since this money went
22 into Prevezon, and there hasn't been any tracing of money back
2 none here. What the complaint alleges is that there was this
7 They then allege that between two and five years after
11 the complaint?
14 $447,000.
21 but it's two years later. Two to five years later they invest
23 New York real estate between 2009, November 2009, and 2012.
3 was commingled, the money for the New York investment was
7 funds.
14 there is nothing that shows that they treated the money any
18 would get paid for them. They would get a benefit. And there
19 were false statements made in the books and records of the chop
20 shop and the cars were broken down into pieces so that the
23 another case that talks about an arsonist who used his business
11 1956 or 1957.
13 the claims, for instance, starting on page 46, the claims, they
19 1956 and 1957. They don't specify any facts that would show
20 that the defendants knew about the fraud. They don't specify
4 link here.
15 problem.
19 said?
1 scheme --
23 a little slower.
2 paragraph 91.
12 series of companies that sent the funds back to one of the tax
9 Prevezon.
14 They have $857,000 that they said went into Prevezon. If that
17 chart --
4 got the money from an investor, Mr. Petrov. And that comes
18 came from those funds or other funds that are not on this
19 chart.
9 gets to Prevezon --
14 detailed.
1 reading it at all.
15 money to Germany.
19 your Honor.
1 client.
4 Euros. All they did was transfer dollars into Euros. That's a
11 estate company with real estate investments all over the world.
12 It's not some shady company. It's a major real estate company.
18 transaction.
20 money is unusual.
22 two things, if I may, your Honor: One, that the money didn't
2 nothing the government has said that excludes that from the
3 $19 million of honest fund money that went into the account.
5 Mr. --
7 clear indication that the funds that Bunicon had weren't honest
8 funds --
13 refund. That right there is ample evidence that the funds that
19 to Prevezon?
21 They do not allege that. Let's look at 97. They don't allege
22 that.
22 121.
7 Prevezon has real real estate and is the type of company that
9 inference that the moving the funds into this more legitimate
20 require the most discovery to flesh out, but it does meet the
25 talked about these funds said these funds were eventually going
9 didn't actually --
3 from some unknown entities that don't actually have any real
7 you might not know this from reading defendants' reply brief,
15 willful blindness.
7 the statute.
13 money -- and I may have misheard him. That was going back into
16 that they have traced, but $19 million is untainted money. And
1 in the complaint, in his brief, that Mr. Petrov must have had
5 reply brief. And there is not a single fact that would support
9 tells you that they realize they don't have a case here,
10 because they have just come up with something totally new, and
20 Honor.
25 all.
12 here, its assets abroad, any and all assets, whether known or
18 alleged.
20 start with the easy ones, of Ferencoi and Kolevins. They are
21 foreign. The assets are unspecified and they did not launder
10 But they don't set up anything at all for the foreign assets of
20 these assets? And the second is, can it restrain the assets
4 foreign country?
11 Grupo Mexicano case, which actually does not say that at all.
12 Then they say, well, the Maza case, where the Second
13 Circuit said that the only way to forfeit assets abroad is with
15 exactly what the Maza case said. What the Maza case said was
5 the control of the Court. What didn't come up in that case was
8 means are in this case the restraining order. And the reason
11 order in these cases, hadn't been enacted when the Maza case
22 the country. And it did that, even though there was a question
3 stands for the proposition that the Court has the authority to
4 issue orders to people who are before the Court. All of the
6 Court.
9 Manhattan, or did recently own that real estate and sold it.
16 in our brief. There they found that a bank that just had a
18 account a few dozen times, that that could be the basis for
5 again.
22 were told that. I don't think you were told it was in Russia,
23 but that's the import of what you have decided. And I say no
24 more.
7 areas, and I don't want to list for the United States where the
11 can come before the Court and the Court can adjudicate whether
19 unspecified properties.
1 business. In fact, they don't know what the business is. Your
2 Honor, with due respect, there is a law which says that they
13 I'm sorry, it's G2C. And that will take care of the
19 would be my request.
8 up to a car dealer and said, United States vs. five cars but
9 we're not going to describe the cars. It's quite clear what
14 When he says any and all, he doesn't know, for example, that it
16 in Russia.
20 guys. They don't know what these companies own, and they
22 this time.
12 Honor. Perhaps the agent could get on the stand and explain
19 the complaint.
23 to that?
25 that we don't know enough about the defendants' assets for the
2 as to them.
6 their needs for money and the burdens that the order is causing
8 there are aspects of the order that are excessive and overly
20 with, the order was entered in the fall. And the question of
21 whether that order remains, this is not going to turn into the
24 some -- and I do not believe that the two sides are probably
1 You're very far apart in your view of the merits of this, which
6 any farther.
7 Now, where does this case go? We're now dealing with
16 them, it's over. If the Court denies them, we would answer and
22 crime and the 60/40 split in the money that went to our client
23 and any allegation that our client knew that this was dirty,
24 which he didn't.
5 But the way this will end, agreeing with your view on
11 everything you own, and since you know whether or not you own
17 Now --
19 application --
5 wrong.
19 more than five stories. I don't know how many yet, with
22 hear -- when someone says that they're freezing all the assets
24 that has a certain carry-on impact for every company that does
25 business with. And the impact of this order exists, and I just
8 business. I do not know the facts about that. I've said that.
23 just some general idea, because -- you know, how long this is
1 terms of time?
11 (Adjourned)
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Plaintiff,
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v. 13-cv-6326 (TPG)
6
PREVEZON HOLDINGS Ltd., et al.,
7
Defendants.
8
-------------------------------x
9
New York, N.Y.
10 March 4, 2014
2:25 p.m.
11
12 Before:
14 District Judge
15
APPEARANCES
16
PREET BHARARA
17 United States Attorney for the
Southern District of New York
18 BY: CHRISTINE I. MAGDO, ESQ.
ANDREW C. ADAMS, ESQ.
19 Assistant United States Attorney
20 BAKER HOSTETLER
Attorneys for Defendants
21 BY: MARK A. CYMROT, ESQ.
JOHN W. MOSCOW, ESQ.
22 -and-
BAKER BOTTS LLP
23 Attorneys for Defendants
BY: SETH T. TAUBE, ESQ.
24
5 materials that I've gone over since and so forth, the issues
9 And so I'm not, we're not going to have any trial on March 31.
11 some other matters, but let's start with what the counsel, what
8 the complaint.
11 focus the case. It would negate any claims that the defendant
12 has, that the defendants have that they are suffering from a
21 THE COURT: Let's start with, have you gone over the
23 order? Have you gone over those things with defense counsel?
4 amended complaint.
15 an amended complaint.
18 it.
24 that --
9 about $857,000. The tracing that was done was done not by the
16 pleading.
23 designated.
22 think --
4 they --
11 complaint alleges that they knew about the fraud, that they
13 complaint alleges that. And last time you were questioning the
8 the $230 million was stolen from the Russian government there
16 remember -- $875,000.
12 says. That's what the complaint says. They allege that they
15 it. Each of the claims says that. And what they're seeking in
5 and reaping some amount of money from that crime. There can be
14 What we are, have been saying and what I believe Assistant U.S.
2 conceal it. And they have not walked away from that. The
14 ends up claiming.
18 claim.
2 yesterday.
4 solved anything.
7 that deposition.
13 determined at trial.
8 And the government now says that their case has nothing to do
10 bring if they had the evidence, which they don't, if they had
14 any verified evidence, and we've not yet sought to get evidence
15 from Russia.
20 they say so. You can't do that. You can't accuse people in
22 basis. And I find it shocking, as you will when you read the
24 investigation was not conduced. They did not get the evidence,
1 assure me that there are no such witnesses because they did not
4 about those?
8 basis for, but if they were, half the money came from the
16 Mr. Kim, who was sending money to Prevezon for the benefit of a
18 situation to be.
20 companies?
24 did they have to use that? Why can't they -- in other words,
7 their assets. And that is how they do business. And when you
8 have an agreement with a Mr. Petrov and you know who he is and
9 you know his father and you know of him and he makes an
11 not go to the bank statement, to your banker and say, could you
12 check to see from whom this money came, to see if they were
16 upstream to see where the money came from. That was not their
17 job. Their job was to invest the money, which they did. Real
18 estate in Europe.
3 (Pause)
13 do that?
9 Honor.
11 saying.
19 respond.
14 those out the door shortly. And they will be delivered on the
21 working smoothly.
10 complaint. And when they say that they are -- I have not seen
11 what they told the Dutch court. And I would ask you to, rather
12 than have it turned over to us, I would ask you to ask the
2 against it.
3 That's not what the law provides for. That's not what
4 Rule G provides for in the in rem. That's not what the rules
17 it has anything to do with you; what you did was, you got some
23 put up with.
3 States. This was not the agents of the verifier. This was a
9 about the statute. They say all they want. They're not
13 the other than the United States associating our clients with
15 your Honor that our clients have nothing to do with the death
3 its case, because this is not the way things are generally
10 has -- I'm not sure it was a formal motion, it doesn't make any
13 right to object to that, which you can do. We've talked about
14 that.
16 vacate or amend the protective order, which you will do. We've
17 talked about that. And the lawyers for the defense know, as
23 will make a motion. And then the other side can respond, in an
24 orderly way.
2 a long time ago. That doesn't get anywhere. When should the
4 doesn't really get into that. The Court deals with what's on
10 rules.
14 MR. CYMROT: That you set a time when they will report
15 on the MLATs.
19 and that we'll set a trial quickly. Because we are now already
20 six or seven months into this case and they haven't done
23 the scenes where the government can't talk about it. But the
4 who can talk about this fraud. There are no witnesses from
5 these banks. They don't have authentic bank records. What can
9 done it and they should have done it. And you're presuming
11 shocked when you hear what they've done. You will be shocked.
21 the motion.
12 this?
16 to the Court's attention and that the Court has the authority
21 yesterday --
13 Renaissance.
15 For various reasons I won't get into right now, at the time
24 Appellate Division of the New York State Supreme Court and I'm
2 Southern District.
11 state court?
15 the complaint has shifted over time, your Honor. They are now
16 saying that we, Mr. Moscow and our firm, are involved in
17 tracing the funds from the Russian treasury. That's simply not
18 true. And we have investigated our files. That was not our
22 Because it's not before your Honor now. And I want to know
23 what their basis for saying what the government just said is,
17 Hermitage?
1 the subject I've talked about, and let's leave it for the day.
2 Thank you.
6 o0o
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4 Plaintiff,
5 v. 13 CV 6326(TPG)
11 Before:
13 District Judge
14 APPEARANCES
15 PREET BHARARA
United States Attorney for the
16 Southern District of New York
BY: ANDREW C. ADAMS
17 PAUL M. MONTELEONI
Assistant United States Attorneys
18
BAKER HOSTETLER
19 Attorneys for Defendants
BY: MARK A. CYMROT
20 JOHN W. MOSCOW
- and -
21 BAKER BOTTS LLP
BY: SETH T. TAUBE
22
23
24
25
1 (Case called)
19 documents, so what?
7 letter.
22 where this case goes, and that doesn't depend on the timing of
24 and that's what I want to talk about today. And we'll talk I'm
14 all. I'm just going to order the deposition notice set aside.
16 matters.
6 whatever happens with that motion, the case will proceed with
17 your Honor.
22 New York and there are funds in bank accounts in New York,
9 States?
13 little more than that. And then there are 3 million Euros that
16 they certainly --
21 Netherlands any orders that this Court might enter with respect
1 restrained.
21 forfeit the --
16 somewhere.
11 and the complaint also does allege that some funds were
17 trial and should the court order forfeiture, those orders would
18 be fully enforceable.
3 courts that any order that a court might make, with the
10 raised in the previous regime that courts didn't have the power
19 Netherlands --
13 the cause --
16 committed crimes?
22 laundering.
8 to get to that.
24 that the Money Laundering Control Act enacted. And we are also
7 means laundering the money that was the proceeds of the fraud,
8 right?
15 countries, right?
21 United States.
2 penalties.
10 of this Court?
14 complaint alleges.
15 And the Second Circuit and the Supreme Court have both
17 that involves the use of the U.S. wires is wire fraud, and the
22 here?
7 it.
3 the proceeds, this $857,000 was not proceeds from the Russian
4 Treasury.
6 government.
17 we have a trial?
23 about?
8 establish this.
10 governments?
1 governments.
4 accommodate that time and set forth a matter of months for them
13 documents?
15 that the exchange of documents between the parties and the sort
18 be --
25 side.
8 complaint, both the in rem claims against their assets and the
11 state a claim with respect to them and that this Court has no
2 motion, right?
7 the bench you stated that you did not see a basis to vacate the
14 informed -- the government and the Court can make more informed
17 forthcoming.
19 From whom?
21 Prevezon. Prevezon has said that they will respond to them and
3 can be on.
4 Please.
7 they've done nothing wrong, and they want an early trial date.
9 was really the only witness who could give us any information
15 Switzerland.
19 what was the basis of their accounting, and we asked them for
6 five Russian banks into two Moldavian banks and then into --
14 fact that $19.4 million of the money they allege went through
15 these accounts was money that did not go through, come from the
16 Russian Treasury.
18 THE COURT: How does the $19 million get into the
19 case? I'm --
11 And if you add up the numbers that come through their chart --
24 details all of you have, but you've got 230 million was the
25 fraud.
4 That's what --
17 was dollars.
23 investors. They had their own money, and that's the money they
24 invested.
5 don't know where the $19 million went. All they say is they've
12 New York. But the bank accounts show either the money stayed
17 They bought eight pieces of real estate in New York, but they
18 didn't buy it with the $857,000. And they have a real estate
1 clients. And they are adamant, they want an early trial, they
4 trial?
20 order?
23 this complaint, it's this big, it's this big fraud motion --
4 accusations.
25 are innocent.
12 time --
18 that the funds that went to the defendants were from the
19 Russian Treasury and not some other funds. And I can go into
5 are --
10 inquiry and that we want to get to the bottom of, but that we
12 without discovery.
16 discovery.
19 another meeting very shortly, and you come in with the evidence
20 that you now have which shows a basis for holding this case
21 open. And I take seriously the idea that having this case open
23 government demonstrate why this case should remain open and why
8 discovery.
13 possibility.
25 demonstration, not just that there was hardship, but also that
2 property for forfeiture, and that the hardship that they were
4 assets.
10 let's go back.
15 Honor that they had reasonable belief that the government will
19 Honor.
24 They haven't shown that our clients had any knowledge of this
4 about?
7 That's not --
14 119.
23 Russian fraud? We say there are none. That they concealed the
2 don't believe --
6 defendants here?
9 paragraphs 91 to 108.
20 assertions that the defendants were told that this was the
23 that other people were doing things, that there was a crime out
2 first 18 paragraphs.
9 but it's not like we got a letter, it's not like we got a phone
14 The defendants are adamant that they did not receive the
2 investment company.
7 Monteleoni?
13 claimed that this Mr. Petrov had provided the funds. We've
20 if you have something you want to say to the Court, don't use
6 what was discussed at an earlier meeting, and I'm sorry for the
7 sake of myself and all of you -- but the way I see things
13 Am I right?
15 agree.
3 question.
9 was completely innocent and did not know anything about that
10 motive, right?
21 of the property, then they would get to keep the property and
5 crime.
14 funds did come, because Mr. Petrov said so, but they came by an
15 additional third party, a Mr. Kim, and that that's the sort of
18 issues about what they knew, what they had reason to know, what
22 mean I'm not going to try to reread all the -- let's assume the
2 it or be willfully blind.
8 to the defendants.
18 the --
21 money --
14 tomorrow --
12 Moldavian companies?
22 owner of Prevezon at the time the money came in, there was a
1 who was a young man working with a fellow by the name of Alex
9 father said, please teach my son some business, and they went
10 and for two years did various business projects, before this
11 all happened.
15 financial crisis. And then Mr. Petrov paid off the loans of
16 he and his partner, and his partner finally was ready to pay
20 business.
22 beyond what Mr. Litvak and Mr. Krit are capable of doing, and
7 already in the account. Mr. Katsyv didn't know Mr. Petrov, but
17 investments.
21 doesn't have a U.S. visa, but he wants to come here and talk to
3 We believe that --
6 owner when the funds came in. Mr. Katsyv then took on official
7 ownership.
19 will reveal.
1 coming back to. Here now we've talked rather intensively about
1 business --
18 got. We don't --
22 lot more than $857,000, and there's just something wrong about
23 this. And I'll assume that $230 million was stolen from the
1 defendants in a case here who are being charged, and right now
6 be lifted, right?
10 Holdings, which includes real estate in New York, any and all
19 about the mental state of Mr. Katsyv, Mr. Krit, and Mr. Litvak.
20 Well, but they allege the mental state. And they represented
23 is that they knew about the Russian fraud, that they promoted
24 it.
12 they think they can make a showing which would get rid of all
13 of this, right?
23 think.
6 In other words, you believe you can prove that they were
8 right?
17 talked about what you might prove at trial, if you told me that
21 you didn't. You said, there are two things here, what we might
1 40 million, you said you were right back with the same
2 $857,000.
6 in the United States, and in this case those assets were, we're
19 provides is that --
4 $857,000.
11 amount that was stolen, it's also the assets that are used to
21 to significantly modify.
25 frozen.
17 the New York real estate, New York bank accounts, and the funds
2 every time they have asked us, for all of the properties that
19 progress.
2 account records. What they say is that when Mr. Katsyv took
4 Germany, that was hiding the $857,000, and that he did that
7 The 857, they could get if they could prove that it's
9 that he hid things by putting his money into this and combining
21 cheat.
6 that starts with $230 million and ends up with $857,000 and a
21 prove them quickly, and you'll have to do it. The exact date
25 (Adjourned)
7 Defendants.
------------------------------x
8 New York, N.Y.
September 18, 2014
9 11:46 a.m.
Before:
10 HON. THOMAS P. GRIESA,
11 District Judge
12 APPEARANCES
22
GIBSON DUNN & CRUTCHER LLP
23 Attorneys for Hermitage Capital Management
BY: LISA H. RUBIN
24 RICHARD W. MARK
SARAH LYNN KUSHNER
25 CAITLIN WALGAMUTH
2 (Case called)
19 Hermitage?
21 with the law firm of Gibson, Dunn & Crutcher, and with me, your
6 colleagues --
14 Hermitage or both, one or the other, take any step after the
19 September 12th, 2014, Mr. Browder, who is the CEO and founder
24 your Honor.
5 law why the subpoenas issued to Mr. Browder and other affected
10 more fully brief for your Honor why we believe Mr. Moscow,
16 that.
7 defendants.
11 going to go all around, but the one thing the Court does not
24 has outlined, but I do want to clarify for the Court that our
3 those defenses.
17 not been sued and it is not suing, and it seems to me the fair
1 sitting right over here, and you invited a motion at that time.
2 They filed none. They complained to our law firm back when we
5 year later.
9 information, and they didn't respond to us. They filed the bar
10 grievance.
16 to quash.
18 down the road, and this is going to delay this proceeding. And
19 this is just tactics. And the Circuit has warned that this
22 town, John Moscow. And this has been hanging over him for a
23 year now because they leaked it to the press when they made the
7 This should not delay this case. It's a year. Our clients
8 have been enjoined for a year now, and this is just a delay
9 tactic.
18 Honor.
20 point?
25 Mr. Browder.
5 Mr. Browder in Delaware for some months ago and is the subject
18 rights is offensive.
25 schedule that you then extended on the motion to quash, and you
1 gave him more time to file a motion to quash. But the subpoena
3 to quash.
5 a suggestion?
12 might make sense to set a briefing schedule now, and one issue
14 would need to take any testimony in any way from anyone and
15 how. That can be a matter for the briefing, and then the Court
22 something?
24 opportunity to respond?
8 issue.
15 Mr. Browder.
17 subpoena. It's the same thing. You know, they'll say whatever
18 they want to say. The lawyers are told things by Browder, but
1 is no motion to quash.
4 the problem. You don't have a record here. You don't have a
11 motion to quash, and it had not been fully briefed. Maybe I'm
13 done --
18 Mr. Moscow and his law firm that is raised in the letter of
20 following that letter, but now Hermitage will make a motion and
21 presumably they will -- I don't know what they will do, but
23 issue about Mr. Moscow's ability to continue and his law firm's
24 ability to continue.
13 deal with the issue of Mr. Moscow's role and Baker Hostetler's
18 relationship with his present client, and I'll expect all that
21 there some party who proposes to oppose that motion and will
1 that motion?
6 correctly?
12 to disqualify Mr. Moscow, his firm and the firm of Baker Botts,
24 that motion?
9 court?
23 representation.
1 need to do today?
6 scheduling.
4 He leaked his bar complaint to the press, and they were in the
5 press over the weekend. It was the lead headline in the Wall
6 Street Journal, about the fact that there was a hearing coming
8 improperly.
13 let these allegations stay out there. They're in the press and
21 schedule?
23 respond in a week.
15 high holidays.
19 MS. RUBIN: They begin next week for two days for Rosh
21 believe. Yom Kippur ends October 4th. October 6th is the next
24 they can file their motion before Rosh Hashanah. We'll file
3 August 7th, since Judge Castel's letter. They can do it, and
8 Mr. Browder and Hermitage Capital had become aware that your
10 the conflict.
13 the Court also were reasons why that motion was not made. We
16 These issues are not new to him and his firm, and
19 simply not true that our complaints are new to them. We made a
25 suggested?
9 the 24th for their filing and ours for October 2nd.
15 by the 24th?
18 when?
21 would --
1 holiday?
7 they've proposed --
11 have, we get under a week and they get more than a week.
25 idea of filing a motion on the 29th and then the answer a week
1 or ten days after that makes more sense than trying to have a
5 and then Mr. Moscow and his firm, when do you wish to answer?
7 say the 6th, in one week, except for the Jewish holidays; so
22 the hearing. So we've got the motion will be September 29, the
24 Now --
9 is.
14 take care of those new issues, and that's what we'll do. Thank
19 (Adjourned)
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4 Plaintiff,
5 v. 13 CV 6326 (TPG)
7 Defendants.
8 ------------------------------x
New York, N.Y.
9 October 14, 2014
11:15 a.m.
10
Before:
11
HON. THOMAS P. GRIESA,
12
District Judge
13
APPEARANCES
14
PREET BHARARA,
15 United States Attorney for the
Southern District of New York
16 JOHN McENANY, Associate U.S. Attorney
PAUL M. MONTELEONI
17 CHRISTINE I. MAGDO,
Assistant United States Attorneys
18
BAKER & HOSTETLER
19 Attorneys for Defendants
BY: JOHN W. MOSCOW
20 LOURA L. ALAVERDI
MARK A. CYMROT
21 -and-
BAKER BOTTS
22 BY: SETH T. TAUBE
VERNON CASSIN
23 GABRIELLA VOLSHTEYA
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1 APPEARANCES (continued)
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1 (Case called)
7 your Honor.
24 with in the past, brings me pain to have to say it, but this is
2 ethicist.
15 elements to it:
20 before your Honor now; and, third, where there was the
9 of the party to parse out and sort and tell his or her former
20 large law firm and someone at the firm; and the second
23 something like that. And there, you get into arguments of was
1 Mr. Moscow was the attorney at Baker Hostetler that Browder and
3 assist them in this matter which now underlies the case that's
7 mean?
13 well, but this is a helpful digest and guide that explains the
18 look at material --
21 it. What is the prejudice to your client? Why are you making
24 understand it.
7 MR. MARK: I would say that the depths and the nooks
9 today, but --
11 today.
15 papers. Let's start with the fact that the subpoena addressed
18 shown, and I really don't think the other side has shown what
8 government has since stepped back from that. It's not clear
9 Mr. Browder will even be a witness here. But our purpose was
11 identified as a witness.
25 right?
4 then it becomes a different issue. But right now they say he's
8 right?
12 They are trying to find out what the government would do. They
21 $230 million fraud which your Honor knows from reviewing the
1 representation.
14 prior representation can't then turn around and ask his client
22 was to show that the nature and scope of the work that Baker
23 Hostetler was done and was privy to, that's the Felgenhauer
3 say, I want to probe those facts to try and disprove the matter
6 client.
5 client. Now Baker & Hostetler and Mr. Moscow are representing
10 fraud"?
16 The fruits of that are in the district, and the basis of the
22 try and put Mr. Browder, as they seek to do, under oath and to
23 turn him into not what they were representing him as, the
8 the subpoenas suggest, that they are going to try and attack,
9 for example, the credibility of Mr. Browder, and put him under
12 unconsciously --
16 rules prohibit.
2 consequence.
4 be discussed openly with the Court, I would point out why they
5 are relevant.
17 was very limited in scope and didn't concern the $230 million
21 the situation where they then use that material, have that
1 Honor.
11 disqualification.
7 somebody who has an Internet site and goes and gives speeches
16 subject.
10 talks about that all the time. And this is what supposedly the
12 ago. And whenever you ask, they either avoid it, and they say
17 confidential information.
23 his current client. And Mr. Green says, well, he should just
24 drop the client as a client. And then Mr. Green says: "If the
2 confidences."
5 he has to prove it. And they haven't proven it. And they came
14 Mr. Moscow -- what did our firm do for Hermitage? Our client
19 Mr. Moscow --
22 October of 2008. Most of the work was done in two months, and
24 finished in 2009.
25 And they came to Mr. Moscow and they asked him to file
1 a --
11 quote that in these tapes they gave you. But they didn't ask
2 two months and he didn't file it. And he had one meeting with
3 the U.S. Attorney's Office, and one meeting with the attorney
7 money for them, dollars in New York. And they said no. But
8 now they are saying -- they are trying to tell you that, oh, he
9 did that work for them. But they don't give you any of that
12 mean if Mr. Moscow did such a limited amount of work, who was
13 their lawyer?
17 initially --
3 declaration, and they had other counsel who was not us. They
11 counsel.
13 lecturn know what were they involved in? Was somebody suing
14 them or how were they involved at that time that they had a
15 series of lawyers?
17 that used to invest in Russia. And they were worried that the
19 $230 million fraud. But that never happened, and that case is
20 closed.
7 already knows that Mr. Browder and his lawyer over there were
8 convicted in absentia.
19 this case are concerned, Hermitage was -- and Mr. Mark can
20 correct this -- but what they were doing was trying to avoid
21 prosecution by Russia.
23 THE COURT: And Mr. Moscow was in the case for a few
4 correct?
16 would enter a protective order, and Mr. Taube's law firm would
21 co-counsel. But he's not in our law firm, he's in his own law
22 firm.
3 well.
13 Management.
21 into 2009.
9 confirmed in writing.
12 Hermitage is not the victim whose funds were stolen. That was
16 term is used.
9 interested party.
15 He wasn't there.
24 the letter.
1 awfully fast.
11 you read the government letter and see what they want in the
21 fact that one can construct a need for Hermitage witnesses does
9 Hermitage, right?
12 I'll ask you anyway: What was the purpose of your representing
18 which they were not involved, one could deduce that they were
21 again.
25 from any of the papers or even from what you're saying now why
6 THE COURT: And where were you when you were retained?
15 the people they said had committed the crime, whose identities
22 a pitch.
5 it.
6 THE COURT: I was asking you about 2008, when you were
7 retained by Hermitage.
19 THE COURT: And I know it's obvious, but you say it,
22 were, they wanted this evidence to prove that they were not
1 Federation.
4 there, right?
8 retained?
10 money --
13 in dollars, then the money may well pass through New York. And
21 Hermitage.
25 that right?
6 record matter.
16 records from Rengaz and Renaissance, those would not have been
20 happened in 2006.
22 2006?
6 prove that Renaissance was the victim to prove that they were a
9 this?
5 evidence on.
7 client Hermitage?
12 they were not involved, and the same thing happened again in
13 2007, that they could argue that they were not involved; that
14 there were people who were doing this, but it did not include
15 them.
20 not involved with that. And the idea was that it helped to
2 this? You were really not involved but for a few months. Did
4 not?
19 represent Prevezon in the case now before the Court, was there
20 any -- I think you already answered it, but I'm going to ask
22 conflict?
25 considered?
10 ask you anyway. What are the issues in this case now involving
11 Prevezon?
3 and the issues you actually dealt with when you represented
4 Hermitage.
7 different.
8 THE COURT: Why are they different and why are they
9 similar?
12 it; other people were convicted of it. And proof that there
16 that they knew that they were getting money that was the
17 proceeds of a crime.
22 fast.
25 money stolen from the Russian treasury. And the details of the
1 accusation are that the government has traced rubles from one
8 Vienna bank, that was supposedly dealing with dollars with U.S.
12 before, again --
17 being did --
20 MR. MOSCOW: No, that was not -- they were looking for
21 evidence under 1782 that would establish that they did not
25 in 2008 and early 2009 for Hermitage was to get bank records
5 right?
7 and convicted, but they were not charged. Hermitage was not
8 charged.
19 come back.
20 (Recess)
23 briefly.
25 Your Honor, I'm from the law firm of Baker Botts. And
22 It's tactical. And the courts recognize that when you have a
5 never raised it before in any sense. And the law Mr. Mastro
7 way.
9 even if this motion were timely, you need hardly say that the
10 law does not impute conflicts from one law firm to another.
14 agreement with Baker Hostetler not to talk about the past case.
20 want to return to, Baker Botts has worked for a year for these
7 while Mr. Browder and Hermitage knew that both these law firms
14 has asked to disqualify anyone, and until they do, I don't want
15 to hear it. And they waited from March until now to make this
16 motion.
19 September 18th, 2014 is the first time they raised Baker Botts
2 front of you today in U.S. v. Prevezon, and what was the scope
5 materials:
13 mind.
16 what you've just said. But the question is what did Mr. Moscow
20 ways:
5 government --
8 remedies.
10 laundering case --
5 discovery request.
12 that they want to get into about the 2006 matter, because they
14 victimized.
17 Hostetler --
22 THE COURT: I'll ask you, Mr. Moscow. Did you draft
23 that?
6 reflects the theories that I just described; they just say it's
10 Mr. Moscow and his firm is this. And I'm not referring to case
23 his law firm drafted up a long declaration, but if that was his
24 work and it only lasted a few months and he didn't even finish
25 it, I really have a problem in saying that that work, which was
2 gets taken off the case where a client has retained him now to
5 was trying to deal with then. And to say that he cannot now
11 enough to take him off a case when he's doing something very,
19 do this.
22 his lawyer will maintain confidences and not use them adversely
23 to his interest.
25 confidences?
7 complaint.
12 Mr. Moscow told you a moment ago was how he got involved in
13 this.
25 the frauds, to the extent that they are trading through New
17 do what?
21 government.
6 going on now.
9 your Honor to the Cole case, once again. In that case, the
11 same attorney at the same firm, Cullen & Dykman, in the initial
12 two.
25 the subpoena served defines "you," not just Mr. Browder, the
2 naming Hermitage.
4 Browder and Hermitage. Now, I think I judge that after all the
10 Mr. Moscow is the same individual who was involved in the first
14 has said you don't have to do. We presume that there was
16 That derives from a test laid down by Judge Weinfeld more than
17 50 years ago.
2 at Baker Hostetler and the client. So you can see on the bills
15 a client.
16 The case law says it's not just hard facts, and can I
3 information from your client; what else does a lawyer do. And
10 I really have to tell you, I've got a very severe problem with
11 the idea that now when he's retained in a different matter, and
12 I mean different in maybe there was some little tie, but this
21 do.
24 don't think, a mean thing for a client who had reposed trust in
5 Mr. Moscow said when he was here, his mission, as attorney for
9 $230 million.
16 discovery, they are not trying to prove the matters in the same
4 here. And though the government doesn't know as much about the
6 Hermitage as the parties, what the government can tell from the
8 is an extremely large --
22 those sham lawsuits. It's the whole story of the 2007 fraud:
23 The 2007 fraud that we are seeking to prove, and the 2007 fraud
3 clients.
14 the government's action here, I know you wish you could recover
20 history in it. The thing is, that gets way past the issues,
21 way past. The issue really is what did Mr. Moscow do for
1 for Hermitage in 2008 and 2009, and now that he's representing
7 all sure that this in any way involves what is legally cognized
8 as a conflict of interest.
16 testify about, is all that history. And I've stood here and
22 unnecessary.
9 Browder, right?
11 the subpoena.
24 and that is, if you have word that the government is going to
1 trial, right?
9 proceeding.
18 trial?
7 And they don't have a single case where a nonparty witness has
12 like Mr. Moscow. They haven't cited a single case that says
13 that.
15 o'clock.
25
10 Before:
12 District Judge
13 APPEARANCES
1 (Case called)
6 objection, and I'd want to hear the grounds for that and I hope
9 sealed record.
12 your Honor, was so that there would not be any claim later by
13 any of the parties here that there had been any sort of waiver
21 a record that addresses that, but that is why we did that, your
22 Honor.
25 privilege?
10 record. The first exhibit, the first exhibit that was filed
19 about?
6 seal.
10 there were a few pages where Mr. Mark discussed that document,
13 seal.
24 today.
1 fine.
14 are today. And I said to your Honor then, your Honor, the
16 will never stipulate to that. And your Honor, I'm here today
7 issue.
21 that your Honor talked about, that history, the first chains in
1 this: Mr. Moscow and his firm -- I'm going to tell you five
6 Mr. Moscow and his firm were hired in the first place, it went
9 occurred.
11 that.
16 them to bring cases just like this one, to go after those who
25 They have spent years trying to expose this fraud and bring
8 taken up that mission too and brought the first of its cases.
11 You should be figuring out who did this and bring those cases
13 government has done it, and the very first party the US
21 Russian prison --
23 at all.
7 day.
12 the fruits of those labors, Mr. Moscow going down and pitching
13 the government in late 2008 and the work he did for Hermitage,
18 after those who were involved in the fraud and the money
19 laundering. Now the government has done it, and the very first
24 take on.
4 through.
9 few months at the end of 2008 and the very beginning of 2009,
14 others. All of that was involved for a few months in '08 and
20 Prevezon.
22 in this sense. Its origins are the $230 million tax fraud --
18 from Hermitage.
20 are not Mr. Moscow's own words at the time of his retention.
22 with the client, which some of them are before your Honor now,
24 but the point is, to expose those who were responsible for the
3 Hermitage.
14 protect Hermitage, and he was only retained for that for a few
24 did he not?
1 of the --
4 Hermitage.
7 identity theft and then using its identity, causing this series
13 Justice. Now we didn't know all the players back then. He was
19 convince them to bring cases just like this one, and the fact
20 that Mr. Moscow and Hermitage then parted ways, as Mr. Moscow
21 put it, and Hermitage continued in that mission because its own
24 of years, the government had put that case together, the one
8 tax fraud and then it has to prove the money laundering out of
9 Russia to get to the US and then who was involved in the money
13 stipulation, and it's what they hired Mr. Moscow to get the
15 like this one when the wrongdoers were identified, and that's
22 cause, the one that Hermitage and Browder hired him to do.
1 Hermitage and Browder didn't know who was involved in the money
2 laundering chain.
7 hired Mr. Moscow, paid his firm quite a bit of money, were
11 and whether there are any assets here, that the government then
15 2008 and 2009, shows up on the other side for Prevezon. It's
18 it.
21 Now we have the case, your Honor, since there will not
25 Mr. Browder can't even travel around the world safely because
11 Your Honor, as your Honor knows, the legal standard is, when
12 it's the same lawyer representing one party and then later
21 Mr. Moscow for his help and asks Mr. Moscow to find evidence of
25 your Honor asked us for more, and we're prepared to give you
3 to be right in public.
5 Honor, and I'm going to ask your Honor to permit us to have the
9 no reason for such a session, and we're not going to have any
12 but it's precisely why the law does not require us to reveal
15 communication.
6 And without discussing how many such charges are out there or
9 was his former tax lawyer, who was tortured and murdered. He
15 may, your Honor, just a second point, and then I want to come
17 about tracing the money. Mr. Browder and Hermitage also shared
18 with Mr. Moscow nonpublic bank records that they were able to
19 obtain that showed the first links in the chain of the money
14 doubt. The question is: Does that disqualify him when the
24 his firm could now represent Prevezon under our conflict rules.
25 The duty of loyalty that the lawyer owes his client, even a
4 to not only defend and help them defend in Russia but also to
6 understand the case and prosecute the wrongdoers and expose the
13 has said to you, your Honor, and it has said that under DOJ
18 trail, the links in the chain, it's Prevezon that has the money
20 going after. So your Honor, that duty doesn't end. Mr. Moscow
21 and his firm took an oath. Took an oath: We're going to press
22 your case, we're going to help defend you in Russia, and we're
2 awfully vague.
14 lawsuit.
16 government will tell you the same thing when it has the chance
17 to speak.
2 Russian mob, and that then the money was laundered through
8 specific as I can be. The $230 million fraud and Browder and
11 money out of the country are things that both Browder and
17 then it had the mens rea to know that they were ill-gotten
22 witnesses in this case, and Mr. Moscow and his firm and their
5 described it, starting with the $230 million stolen from Russia
8 nothing about, but I want to tell you that I will not dispose
19 This was a very big scheme, most of which at least the people
21 don't know the full details of money laundering that went on.
5 Now the thing is, when you speak, you speak broadly,
8 going to let you know, and your colleagues, right away that I
12 well presented, and that's fine. But let's not keep going back
14 different spot.
16 saying that, and I know your Honor is very familiar with the
17 law in this area and I know your Honor knows and respects
21 sure will want to point out that that motion was denied last
22 week, your Honor. But Mr. Green, Professor Green, says that,
3 word, is a betrayal.
7 be. The very real consequences of this. What are they about
11 Ted Wells and Ike Sorkin and David Boise, and I had one brought
20 why they can't represent Prevezon now, because they know a lot
1 sweeping subpoenas, and Mr. Moscow and Mr. Cymrot tried to tell
3 just need to know what his story is. Well, they didn't give
4 you the straight scoop, your Honor, and you can't decide the
7 colleagues have been saying about Mr. Browder and Hermitage and
9 case, having learned all about his past criminal case and the
16 And now they're going to use that knowledge, you can rest
17 assured, to go after Mr. Browder and try and vilify him and
18 crucify him in the deposition. Don't take my word for it, your
19 Honor. Mr. Cymrot, Mr. Cymrot, in the press and in their court
3 Honor, that are in the record, and I'm going to hand this up to
8 in this case.
10 earlier hearing.
12 argument.
18 going to have him answer "hard questions about his tax cheating
9 me like they learned a lot about Hermitage and Browder and they
1 dogged this company and dogged Mr. Browder and all those
7 about this.
9 have said are the rationales for the sweeping discovery are on
11 It's not what they said to your Honor the other day when they
12 were in here trying to say this was just discovery to find out
13 what a witness would say at trial. Now, your Honor, you don't
16 wrong. I'm not asking to indict anyone here. I'm asking for
20 to try and impeach them and vilify them and to then come here
21 and say to you, like they did the other day, it's just a simple
7 credibility and his reliability and impeach him, and you knew
9 about what he's been through from all those criminal charges,
10 and now you're trying to get discovery on that and impeach him
11 with it? Excuse me, your Honor. I get a little upset about
15 two points --
21 in.
25 don't see how any of this relates to the issues in the case.
1 And I have not gotten deeply into the case. The case is in its
7 came to the United States was vastly less than $230 million. I
10 understand it is, how did Prevezon get that money that they
16 about.
18 want --
22 that somehow the original big, big, big theft of $230 million
4 mouths start talking about the big fraud and so forth. We know
6 thousand times.
10 issues here.
10 and other aspects. Your Honor, the point being that there's an
13 the minimum that comes out of these proceedings, and maybe down
14 the road your Honor is right that you will be able to narrow
15 the case. But you left us with that mission in chambers when
16 we left your chambers the other day. And the government tried
18 have to prove the $230 million tax fraud and those early links
23 spend time proving those things that are known by all humanity.
3 history. We're not going to have a trial about things that are
5 of, as any trial judge in this court would do. We don't sit
8 well from having had the honor of trying cases in front of your
9 Honor, and I know what a tight courtroom you run. But your
12 those things.
15 going to --
17 back --
22 should be dealing with now, but let's try to stick to the point
23 and not get off into things because I don't want to get
11 their reliability.
11 in that regard --
16 and --
1 Please.
13 (Pause)
15 from here?
19 entities or persons.
2 and same subpoena, almost identical word for word, and your
5 Exhibit 22, your Honor, in the book there, pages 15 through 17.
6 Their words, not mine. That they are seeking this information
2 is directly related to --
15 entities and Mr. Browder. And if you read on, your Honor, they
16 further criticize --
20 Honor?
7 to read further what they say there on pages 16 and 17, your
13 and they say that they want the tax returns and tax rates and
2 our time is limited today, and we'll come back tomorrow or any
3 other time your Honor can give us, but let me just make two
5 important.
18 your Honor.
20 not representing --
25 and --
10 adverse effects are real and just as real and palpable today.
14 appreciate it. Thank you very much for all your time, your
17 Okay.
23 money. It is at most --
4 witness, and under the law, that is not a new question. Does
6 And there are about four or five cases in this district that
10 Skidmore case, the court said just because the former lawyer
17 disqualification.
19 might impeach Mr. Browder but he never said how Mr. Browder --
2 give you the cases, because the cases all go the other way.
7 that. And every time you ask -- and they try to suggest there
13 overbroad, you may not find them overbroad. You may find
21 law. That was the question you asked. And the answer is, they
24 witness. And yet they say even if they are a witness, the
9 not a unique situation. And you have to look at the law. They
10 should be looking at the law. I know your Honor knows the law.
12 the law. They have one case, the Cole case they cite in their
16 nonparty witness.
20 of all, the way they are a victim is their names were used.
21 That's it. They had no financial loss. And the fact that they
23 material adversity under the law of Rule 1.9. And this point
25 submitted with our briefs, where he said you can have what he
2 You might root that the government wins this case for, as you
4 interest under Rule 1.9, and Professor Simon pointed that out
10 record and that I'm not at this moment as fully acquainted with
11 the record as I should be. But what Mr. Mastro did was to say
12 that you and your firm made statements, in one form or another,
16 Mr. Mastro said is that this was not a matter of simply serving
17 a subpoena to find out what Mr. Browder and Hermitage might say
22 said.
1 those statements.
5 under the Skidmore case. I'm reading the law and it says I'm
10 last part.
12 was defending our law firm and our client from Mr. Browder's
24 he's going to go after him and show he's unreliable and lacks
2 your Honor.
9 okay? They're the ones who are trying to force him to come
10 here.
25 against Mr. Moscow and our firm and Mr. Browder immediately
8 We've read the law. We quoted the law. They talked about
19 client. And the judge did not disqualify him last week because
21 client. And that was the question you asked. You asked
25 disqualification.
2 following the law, the comments, and the cases. And there is
13 It's not just that the subpoenas are overbroad. Mr. Browder
24 hear his story but then you challenge his story. That's just
25 the way the system works. You know that. If you have a
1 witness, you ask him what he's going to say and then you
2 challenge the story. You test his credibility. And what he's
11 yourself.
14 material adversity.
21 Rule 1.9, correct. There are about four or five cases that say
24 finished?
1 points he said.
13 fraud and if you look at what the government said they wanted
15 said we'll stipulate that there was a $230 million fraud, the
19 point. Your Honor could narrow this case so that they are an
10 claim and it got resolved without a claim ever being filed, the
11 lawyer only spent ten hours working on the matter -- you might
14 Honor, I mentioned --
17 but let me just finish, please, so your Honor has the benefit
18 of this.
19 Less than ten hours on the case. The court found that
23 against whom the claim would have been brought, his client,
13 matter.
15 side?
21 client was the victim of that fraud that led to the money
22 laundering.
24 discussion and lose what is really relevant and that is, what
25 are the issues in this case? And the issues, as far as I'm
4 absent a narrowing of the case, are part of this case, and they
12 sorry.
14 clear. You can look at this subpoena and see that the subject
16 against Browder.
21 MR. CYMROT: He is --
14 light of day.
16 Paragraph 2 on page 4 --
19 public matter.
21 public thing.
6 says --
10 there have been criminal complaints that have never seen the
11 light of day but Mr. Moscow and his colleagues know about them,
14 litigation, when the only way they would know about that is
16 subpoena goes to --
12 me, and that's what we're talking about, then obviously a party
3 say at the trial because Mr. Cymrot and others at his firm have
16 Mr. Moscow --
20 more thing --
23 They're press accounts that quote Mr. Cymrot, and Mr. Cymrot
8 the court, he was going into court -- and this is Exhibit 12.
15 that meant they believed what was in that declaration. And now
16 instead --
22 Browder, take that relationship, the trust that they had and
23 loyalty they had and impeach him and try and say he was lying
24 all along. That doesn't work in our system. And the caselaw,
1 cited, and if your Honor would review the other Second Circuit
2 cases, you would see that in a circumstance like this, the law
3 is crystal clear. It's not the New York Code. It's the
5 it's what the Second Circuit has repeatedly said. When it's
6 the same lawyer that had shared confidences in the past, you
7 can't be the one who's now doing the work to impeach your
10 they're related. Your Honor can see the adversity. And your
13 something, but I don't see that the record before me shows that
19 Mr. Browder speaks, week after week after week, repeating the
20 same story.
3 Nothing.
9 to make?
11 Mr. Browder where he said, I'm not worried at all about your
13 anything wrong, and now that firm and Mr. Moscow are going to
15 discussed his tax case, and Mr. Moscow, I will submit to your
16 Honor, is saying, I'm not at all worried about your tax case.
17 I'm not --
2 your client. But your client is not even a party to the new
5 issues. I'm talking about the real issues in the case, and
14 Honor that Mr. Browder and Hermitage are victims of this crime,
15 and they do have a direct stake in this case and they are
18 letter.
23 Magdo.
25 want to clarify several things that may have come out about
22 right?
5 sure you're not, but I'm going to ask you anyway. Are you
11 case.
17 companies and --
9 the people who sent them the money, that the people who sent
15 period of time.
25 connection of Hermitage.
2 what --
3 THE COURT: Maybe it's the way you describe it. Now,
9 The court is ruling that Mr. Moscow and his firm are not to be
18 in the case.
11 between him and Hermitage. That was in early 2009, five years
12 ago.
17 far beyond what he dealt with in 2008 and '9. And as far as
20 merit.
3 brand new lawsuit which has issues that are relevant to what is
17 that the government may very well call Hermitage and its
19 the government has just given of what its case is, it is not at
20 all clear why that should be, but that is up to the government,
21 and if they feel they want to go into history and so forth and
1 issues are such that Moscow and his firm cannot represent their
6 to the new action. The government and Prevezon are the parties
7 to the new action. And the court sees no reason whatever why
8 to dismiss.
13 time.
8 and that has also been stayed by this Court's order on Friday
15 complaint.
22 have said that they wanted to be made, and this Court thought
2 changes.
8 that's worth approximately $10 million and then there are Euros
1 million.
9 this, the fact that there is more fraud money coming in that
19 received the money and they also received it, the complaint
6 defendant, that also falsely said that this money was for
12 that, either way, the fact that they would go to these type of
17 the bank records and say I didn't sell anyone any sanitary
18 equipment, might call the bank, and might try to find out
19 what's going on, and the fact that the money launderers forged
22 intent.
4 the idea that these transactions were innocent and that he had
11 evidence that the defendants knew that they were laundering the
17 that would be, we believe, from what the defendants have been
7 to trial against the banker where the judge found there was no
8 crime. That omission changes the fact that the owner of the
11 saying he should have known there were these laws even though
12 there was no crime, and he should have known about the laws in
18 Israel.
19 Those are spelled out in our papers, but, quite frankly, the
20 government does not spell out facts from which you can infer
1 sorry.
9 complaint is that the money that was there was not his. To the
10 extent that the government says, well, gee, we think that money
13 Moldova; they did not. It does not mean that they can call up
20 and 7 percent from AFI. When they bought that, they bought
2 companies.
4 could get it out again. They bought shares. And when they
5 bought the shares, the shares stayed in their names. They were
6 their assets until it was sold and the proceeds are what is now
15 decide the merits of the case this morning, and I haven't heard
18 be that you will win the arguments that you are putting forward
19 now, but what I have said is, and I stick to it, I am granting
1 proceed and I stick to that. I've said this about three times,
6 they haven't yet been made and they don't need to be made this
7 morning.
11 to say that the only money that the government says is tainted
23 investment.
4 money coming into the United States and being used in the
12 Zurich.
14 is that narrow.
15 Am I right?
19 in the complaint.
3 narrower.
9 vacate. If you are going to deny that motion, I would ask, for
10 the sake of the record, that you say you are denying our motion
15 to cover today?
6 The United States has moved to quash in part for some of them.
25 United States. Based upon what you did, we may move to strike
12 judgment. I'm not precluding that, but I'm just talking about
15 that?
18 subpoenas.
1 service?
10 course.
14 address that?
16 There are issues both about the service of Mr. Browder and
24 not believe Mr. Browder was properly served with the subpoena.
9 server put the subpoena under the windshield wiper of the car.
4 service?
7 subpoena.
9 to appear in New York City, that would have been outside the
12 to be taken in Colorado.
13 THE COURT: But I'm sure it's the law that somebody
15 deposition does not require the person to go, what, more than
6 facts.
15 He was with his minor son. He walked toward his car, and he
16 drove away.
24 within Aspen at the time of the events Mr. Cymrot and I have
4 subpoena is measured.
8 any other place. But I believe, your Honor, we have come far
9 afield from the issue that Mr. Monteleoni raised, which is why
20 for you, there has been no meeting of the minds among the
1 centerpiece of the case. They told you, your Honor, last month
4 here, and yet they want to proceed with motion practice that is
12 here in a way that makes sense. Your Honor has the authority
14 hold, until the pleadings are more settled and until the
16 for party discovery, which may obviate the need for any
24 this case.
8 the prior proceeding, I was told about the fact that a subpoena
15 Is that right?
21 happened.
5 Mr. Cymrot.
11 dispute.
22 jurisdiction here.
1 claims --
15 of the Court. He's not being sued. I don't know any basis for
19 testify in this matter in this court when his position and the
22 about service.
4 declaration.
19 proper factual record, and I don't know why there is not. You
24 Court.
1 possibly -- did you advise, I'm not going to get into that.
8 Honor, the reason that I appeared this morning and the reason
12 horse.
15 knows that Mr. Browder is not a party, and to shift to him the
18 when he was here last month, told you on the record that he is
25 complaint. I'm not sure how we're getting to the point where
8 what the government has in mind changes almost every time they
11 his deposition.
13 that briefly.
16 of any case, the course of discovery may narrow and refine and
2 substantially.
3 THE COURT: When you say party discovery, what are you
4 talking about?
11 and we just didn't hear back from them, and we later heard in a
7 asking you to decide scope right now. We're just asking you to
9 can get his deposition and get his pretrial deposition. That's
17 those issues and they're not just about service. Mr. Cymrot
24 Mr. Browder, and if he is more than 100 miles away from New
25 York, they can't serve him with a subpoena and require him to
1 come to New York. Things like that are well understood. Now,
3 motion, but the way the Court is going to leave it is this way:
7 his own, and there's not any merit to the idea that that would
24 That is my ruling.
4 way, and that's what will go on. That's my ruling and that
14 describes Mr. Browder, to travel more than 100 miles from where
16 business in person.
4 is a citizen.
24 asserted. Now let me ask you this. I know briefing has been
3 Honor.
19 affidavits of service.
19 but none of that has been completed now, and I am not going to
2 today?
5 defense, was that the current motion practice will be about the
6 service issue and we can work with defense and the nonparties
7 to work out a schedule for any issues, if there are any, about
11 (Adjourned)
12
13
14
15
16
17
18
19
20
21
22
23
24
25
4 Plaintiff,
11 Before:
13 District Judge
14 APPEARANCES
15 PREET BHARARA
United States Attorney for the
16 Southern District of New York
MARGARET GRAHAM
17 PAUL MONTELEONI
Assistant United States Attorney
18
BAKER & HOSTETLER, LLP
19 Attorneys for Movants "The Prevezon Defendants"
BY: MARK CYMROT
20 JOHN W. MOSCOW
LOURA ALAVERDI
21
BAKER BOTTS, LLP
22 BY: SETH TAUBE
1 (Case called)
15 two --
6 February.
14 either the Aspen or the New York subpoenas are valid under Rule
17 we are here for that limited purpose. We are not here today
18 about the scope of the subpoenas. We are not here today about
21 to dismiss is pending, the case has not yet been defined for
1 question.
3 Honor.
11 Rule 45. And what does Rule 45 say? It says that a subpoena
13 officer, to travel more than 100 miles from where that person
15 person."
3 today as to how both the Aspen subpoena and the New York
5 by the other side and Rule 45 case law in this circuit mandates
22 commenced.
5 Aspen.
12 Aspen, LLC.
8 of that property.
12 doesn't own it --
15 record in this case tells you who doesn't own it. William
16 Browder does not own it. But, if your Honor wants us to get
2 members of his who indirectly own the property but he does not
7 record in this case as not owning Sundance and not only that
8 house, right?
12 MR. MASTRO: So, not only has Mr. Browder sworn to it,
14 Now, your Honor, what does their claim come down to?
17 comes down to, your Honor, that Mr. Browder acknowledges he has
22 Now, your Honor, the very slim read on which they try
24 resides and works in London is the fact that he has had, from
9 District Court --
13 waste their time. I would recommend that you not spend any
14 more time on Aspen. We will hear what the defendant says and
15 then you can reply, but I think that's the most efficient way
16 to use your time and I think we had better switch to New York.
18 defendant says, but I think what I need to hear from you about,
21 can just finish the one sentence that I was saying about the
11 present.
15 enough under the law here in New York. It isn't enough under
3 to --
11 case -- and I think when one looks at the videotape that was
17 close the door, and he left his vehicle in fear not knowing,
18 walking away and then running if you watch the entire video,
19 not knowing what was going on. To us, your Honor, that is not
13 firm that now invests his own assets accumulated over time, but
14 that has been an investment management firm for more than two
15 decades.
20 person means where the person works. That's the word from the
21 advisory.
25 rely, Edelman and the Kohne case which talks about regularly
11 you take 2015 out where he has only had one day here on
3 single case, they cite none and we are aware of none, where any
10 non-profits.
18 principle.
1 again.
7 I'm an unpaid activist who cares about the cause, your Honor,
17 transacting business.
11 Now they point to, your Honor, only one case -- one
3 this country, anywhere, where any Court has ever held that you
8 Chin's decision.
11 Honor --
17 track down what they say are 20 other days when Bill Browder
19 other days since 2010 when Bill Browder has been in New York on
20 his unpaid human rights campaign and they ask you to count
21 those days.
23 course if Browder had been here they would know because they've
24 been trailing him, they're on him like a cheap suit like they
1 people trying to track him but they came up with what they say
2 are 20 extra days on top of the business days when Browder was
6 them and some of them, they are basing that on something like a
8 fact, Browder was not here in New York on those days. Some of
10 having been here on business for his investment firm. But, the
14 53 days since 2010, 10 of them they say have been in 2015 since
15 the book came out and there was more advocacy work in
16 connection with the book coming out, again, a book where Bill
4 where he resides and I just have to tell all of you that the
7 colossal waste.
10 by the defense. And it may very well be that Mr. Browder has
23 federal judge I feel that we could carry on, this is all very
24 well done, very good legal work on your part and the other
25 people who will speak but when all is said and done, if he is
11 THE COURT: You are doing fine but I have to make that
19 the only point that I was making about counting the days is no
22 here even though all the days they want you to count than Judge
2 they are.
10 the government that and in our papers that he has not agreed to
20 done here, we think, before Mr. Browder was hounded around the
23 his advocacy.
20 identified documents. The other side has told you, your Honor,
23 and you will see that under the Hague Convention they can get a
25 identified documents.
4 federal rules.
9 have changed. The other side has said Browder may not have
19 That's what Judge Chin said right here in this court house and
2 the other aspect of Rule 45. But what I would suggest to you
5 move along, let's hear from the other side now and we will be
14 Prevezon.
21 we said, Will you sit for a deposition under the U.S. rules?
3 largely useless.
9 London, we would have accepted that and none of this would have
1 Colorado?
3 it right here.
9 Thank you.
11 that fast.
14 Legal address.
22 question about the legal residence you can let us proceed with
23 those subpoenas.
1 isn't some occasional place that he goes to. But, the fact of
7 Convention.
19 States under Rule 45(c) you have jurisdiction over him and you
21 Procedure in London. And you are right, that would put an end
1 are saying.
16 THE COURT: For some reason I don't see what you are
17 talking about.
3 (pause)
11 go to 45(c).
17 has jurisdiction over the deponent and can order him to appear
19 So, it doesn't have to be you serve him in New York and it has
21 here but if you disagree with us, you would say I find there is
1 you.
15 your Honor.
2 decision in NML Capital, and your Honor will recall there was
6 no valid subpoena and the argument was made that you could
10 than 100 miles, however, the Court does not believe that Rule
16 think that answers the question, your Honor has answered it.
21 in a foreign country.
23 over him under (c), 45(c), which you gain by the service of the
9 and the DMV records. If you need more evidence on that, then
11 additional records about who is paying for that house and whose
12 residence it is.
17 is Mr. Mastro who represents the agent and it is Mr. Mastro who
22 no one else.
11 for a book. He says, Well, I'm not keeping the money. That's
16 and advertising that book and marketing that book in New York
2 property.
7 York between 2010 and 2015. His math is a little off because
10 public record and the cites are right there. They come from
14 solved, your Honor, if Mr. Browder would give you his passport
18 It will show you exactly how many times he has been to New York
22 told you about his book business which is clearly business, the
23 sale of a book in New York, and he hasn't told you about his
13 45(c) was created for the convenience of the witness. Any one
12 175, line 7:
13 "Q How did Browder obtain the bank records that he gave you?"
20 177, line 7:
21 "Q Did you ask about the source and the authenticity of the
22 records?
25 property, did you ask about the source and authenticity of the
1 records?
6 and the government and the theft and then there is this thin
9 Mr. Browder gave those records to the government and would not
11 authentic. And, you know, how they could have proceeded takes
14 from and whether they are authentic. And no matter how many
7 interrupt --
19 that deposition because the way this has been litigated, that
23 York. He has not been candid with you about how many times he
7 get into some of the points that Mr. Cymrot was making about
9 are before the Court now, but if the Court has any questions
11 believe Mr. Cymrot was describing and didn't provide the full
12 picture.
17 I said we are not here today to get into the merits but
18 Mr. Cymrot has previously told you and your Honor noted it in
24 affecting defendants."
1 the matter is even the government has told you in the letter
2 that they submitted on March 6th that "it is not clear what
10 case that has ever gone there. And he ignores your own
24 with the human rights campaign and the book in the evening --
2 the issue about taking Mr. Browder's deposition has been under
9 since February 2, has been in New York for a book signing, for
12 something.
14 THE COURT: All the lawyers here knew that the taking
21 deposition was not taken when he was in New York. Maybe during
23 in and out of New York, but he was in New York over at least,
25 February.
4 unless the defendant gives up on it. And I don't see any sign
12 THE COURT: Yes. You must have known they wanted his
24 they've requested.
4 deposition just because they want one. My client has not even
7 in this case.
11 your point.
13 a calendar which shows that he was in New York during the time
14 when he and all the lawyers knew that there was a desire for
16 it. I know that. But, there are times when people consent to
3 prevent him from going on The Daily Show on February 3, Fox and
11 six-day period.
4 but more importantly, your Honor, Mr. Browder has in fact not
20 45.
23 that they're talking about, even if you counted all of them and
1 the count and that it wouldn't move the needle the times he has
4 the count, it would be less than nine days a year and Judge
7 that.
12 have not been completely discussed but they are on the record
13 here but they are discussed in the papers at length and I want
22 Thank you.
6 quashed.
3 his human rights activity which he has become more and more
9 was in.
11 very recent, the records show he was very active in his human
15 that is within the meaning of Rule 45(c) and places him within
22 process by which this Court can direct him to come from his
24 States. So, although there has been service and there would be
6 served in New York. You have jurisdiction over him and you can
7 tell him to come to New York and produce documents and give a
9 New York.
14 Washington, D.C. And I would ask that you order him to do that
18 you can order him, even from England, to produce documents here
21 (recess)
23 from its original date until the time of the hearing which has
1 15.
7 that date out with my deputy clerk sometime in the next few
22 Thank you.
13 conference with the deputy in a few days, that between now and
1 do it. You come to the conference next week and you will see.
2 Okay?
3 Thank you.
4 o0o
10
11
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16
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18
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22
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24
25
4 Plaintiff,
11 Before:
13 District Judge
14 APPEARANCES
15 PREET BHARARA
United States Attorney for the
16 Southern District of New York
PAUL MONTELEONI
17 MARGARET GRAHAM
Assistant United States Attorneys
18
BAKER & HOSTETLER
19 Attorneys for The Prevezon Defendants
BY: MARK CYMROT
20 JOHN W. MOSCOW
LOURA ALAVERDI
21 -and-
BAKER BOTTS
22 BY: SETH T. TAUBE
-and-
23 GABRIELLA VOLSHTEYN
24
25
1 (Case called)
3 that I received a letter from Michael Kim, dated March 13, and
5 Browder, and says that arrangements are being made for him to
22 over the discovery schedule today, the Court could refer that
1 should go forward.
3 here, this case was filed in the fall of 2013 and it progressed
4 for several months and then in the spring of last year, almost
21 that, but then the Court adjourned the trial because the
19 duplication. Then two months for experts and then the Court
22 would have the case teed up for trial around the end of this
11 dismiss. Am I right?
14 word.
22 on an expedited schedule.
6 discovery?
11 have in mind as to who will provide discovery and what you call
12 party discovery?
15 transactions that are the basis for the complaint. And the
19 Mr. Browder and may not even include Mr. Browder. There may be
23 case is about.
25 say?
3 THE COURT: I'm sure I've got it here, but can you
18 year we asked for a quick trial. You gave us a date at the end
20 They have now had another year to investigate this case. They
21 have been using a grand jury to investigate this case and not
8 words, they have gone for another year. We have now had 18
10 basically the rest of this year. And you have tied up all of
14 they have never done any business in the United States and you
22 defendants filed?
3 noted, the same in the Court of Appeals, the issue is not the
4 same.
11 could moot the need for discovery, and you could dismiss the
14 need to wait.
16 correct?
8 the Supreme Court decided the Morrison case and the Second
1 inadequate. I'll give you one for instance. They claim that
5 separate the 19.5 from the 1.9. There is no link. And there
17 injunction.
7 documents.
4 will dismiss the appeal. If they feel that they are going to
5 get to the merits, they will get to the merits. I don't know
6 what they will do. But something is there. And it's difficult
13 a spring trial.
16 THE DEPUTY CLERK: The 14th, the 22nd and the 23rd,
17 your Honor.
3 a trial date for this case and it will be the 5th of October.
15 long time before trial I would want to wait until the Court of
20 with deadlines.
24 Anything else?
8 discovery isn't on hold, just like any other party in the case.
11 case. But the other thing that would help today is if the
13 exchange of documents.
16 order to defense counsel on Friday and have not heard back from
17 them.
25 we have for the last year, over the fact that the government
13 your Honor.
18 that they can use them against the civil parties who produced
24 used absent the right of law, absent the legal claim. But, of
25 course, what that means is, that in a civil case the party
10 evidence, you don't have the same people doing the civil case
11 and the criminal case at the same time using grand jury process
14 them.
16 issues now that I'm not familiar with. I don't know what the
17 rules and regulations, what the law is about what you are
18 talking about.
4 promptly and doesn't interfere too much with discovery now that
5 we have a trial date. But I would just point out that a number
6 of the remarks that Mr. Moscow have made are just not correct.
7 He said that the same people can't get grand jury information
8 in a civil action.
3 discovery.
7 records --
11 calling for the production of bank records, and they even sent
12 a certified --
17 around it. I don't know to whom they have issued the other
15 something definite.
20 Is there a motion?
6 record.
14 that?
17 is March 24, we will get these on the file in some orderly way.
10 course.
13 Honor.
16 o0o
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18
19
20
21
22
23
24
25
4 v. 13 CV 6326(TPG)
11 Before:
13 District Judge
14
APPEARANCES
15 PREET BHARARA
United States Attorney for the
16 Southern District of New York
PAUL M. MONTELEONI
17 MARGARET GRAHAM
Assistant United States Attorney
18
BAKER & HOSTETLER, LLP
19 Attorneys for Movant Prevezon
MARK CYMROT
20 JOHN W. MOSCOW
GABRIELLA VOLSHTYN
21 PAUL LEVINE
24
25
2 Appearances (Cont'd)
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
3 Honor.
7 Honor.
10 we were here that set April 15th as the return date on the
21 what was produced and you will see that the production is
7 was the basis for the purported tracing of money from the
9 banks into the Prevezon account. This is the basis for the
18 Russian treasury.
4 talk to his team. His team supposedly knows about this. This
5 is the man who has been going around the world saying that our
6 clients took money, a theft from the Russian treasury and this
10 know what the columns mean. What documents were these based
12 has to back these up, yet this is the heart of the case. So
13 we're asking that you compel him to produce the documents that
16 government; right?
19 government?
25 fine.
3 Mr. Browder's deposition and I will tell you right now I don't
12 basis for the claim. If you are concerned about the basis for
13 the claim against your client, which you should be, but that is
16 anywhere.
18 that lead. Can we keep the subpoena in place so that you have
23 subpoena.
15 productive, well, the way we got to Mr. Browder was Mr. Hyman
17 Mr. Browder and his staff and nothing else -- very little else.
20 took of who?
7 his staff and his documents which is why we spent so much time
16 MR. CYMROT: You have got some documents and this was
20 tracing was based upon. So Agent Hyman said that he would have
22 Mr. Browder and his staff. They would not disclose the source
3 filing this case. The government filed the case. Mr. Browder
13 Hermitage. These are who the witnesses are. They are claiming
1 THE COURT: And you want to find out what is the basis
3 claim; right?
7 says, We'll see Mr. Browder, you better come back to me and I
9 Mr. Browder. If there are some things about the case that
15 you are going away for some time so how should we handle it
21 being put aside. What other discovery are you going to seek?
1 These witnesses are outside the United States, the ones that
12 others companies, but they won't give him a visa to come into
17 that I know of for sure and they will not give us copies of
24 submitted to the Court the last time Mr. Cymrot claimed that we
1 that when a deposition date for Mr. Katsyv was set, we would
2 parole him into the United States and give him letters of safe
6 requests.
8 about?
14 discovery.
12 have because we ought to know what they are saying to the Dutch
17 saying about that because they cannot have a case there and
19 We have been saying all along that the money went from
22 an order from you enjoining property here went over there and
24 million that is frozen over there and you have frozen something
6 saying.
9 THE COURT: The microphone will not pick you up. Keep
10 seated.
18 they say that there is money due in Holland given your order
19 here. The question of the use of the treaty and the reason why
20 we want more than the evidence, we want to know what was said,
1 have different language and I have not seen any nation's treaty
2 that the government said has gone to that nation that permits
4 have read the treaties, I have studied them, I have worked with
11 says we will not tell you. There are answers that are given to
5 freeze property but does not ask them to gather evidence and
7 which they could have gathered had they sought evidence, that
13 at least for the time being spend no more time or effort and
15 idea was that the Court assumes there is other discovery that
20 to Mr. Cymrot.
15 government; right?
19 document request?
3 can now go forward but it has not been accomplished yet; right?
6 assume?
10 mentioned?
20 government?
22 the response.
5 done and we won't wake up four months later with something that
12 do it promptly.
18 the details of that at all, but again make sure you consider
19 whether the document requests that you have made are sufficient
9 and we have no idea how they are going to get bank records into
1 every detail, not every word of the potential testimony but the
17 by whom.
23 o0o
24
25
4 Plaintiff,
5 v. 13 CV 6326 (TPG)
11 Before:
13 District Judge
14 APPEARANCES
23
24
25
2 (Case called)
6 hear from the lawyers, but let me start because I have received
16 motions for summary judgement are decided, which means that the
19 a more expedited schedule and the details are not listed, and
20 they don't need to be, but the request is that all document
1 September 15th.
4 and there may be motions and I don't know how they will be
21 protective order, but that's not been fully briefed, and I'm
23 that today. So I'd be glad to hear any comments and have you
8 his regrets.
17 in this case began on June 15th for various reasons, which I'm
20 deposed.
4 good idea is to start with the most important and it may end up
5 that you only need two or three. But to sit here today and say
7 no.
9 sides.
13 may be they don't have to go all the way with all those others.
22 hand, has been claiming that they want an immediate trial, but
23 on the other hand, they are the ones who are not producing
15 possible to trial.
20 needed for the depositions, and then I wasn't sure what timing
21 your Honor had in mind for motions for summary judgement. That
3 make sure that there was time for all of that in the schedule
4 because we would hate to move the trial date yet again. Our
6 Honor.
9 Honor.
17 default on a notice and not come to the Court and ask for a
22 happened?
2 one has a right to fail to attend the deposition that has been
11 letter under the local rule, but I suppose we could have come
23 there be?
25 there may be some odd documents here and there. We're trying
1 to get documents from third parties, but there are not huge
5 year to a year and a half with grand jury subpoenas and MLAT
16 and this is one thing I would ask you to say -- to tell us what
10 because you haven't given us your documents yet, and then they
22 We're back.
3 vacations.
11 interrogatory answers due, and we would ask that you set the
12 time for that next Friday, a week from tomorrow, for our
20 date?
23 THE COURT: 21st, that's the due date for that. Very
24 good.
2 (Pause)
9 visited the White House and the Treasury Department. There are
10 other departments, the FBI and Treasury and State and the
17 Attorney.
12 we've said, the big fraud scheme allegedly from the Russian
16 that story that didn't hold up. The government I don't think
25 that.
2 a trustee. They were only a trustee for a trust, but the whole
15 you start at the very outset what is claimed and what is really
16 in the complaint, you get into this problem with the Russian
18 so on.
22 not a case in which various other people who may have been
24 That's not this case. This case is about Prevezon, and it's
25 not going to do the government any good, the Court any good, or
1 Prevezon any good, unless the issues are reasonably defined and
3 to Prevezon.
7 issue is, did it receive any money allegedly stolen from the
14 proceeds of the theft, then the case ends right there. Right?
16 THE COURT: Well, what's the evidence pro and con what
21 they can use accounting assumptions and show that $1.96 million
23 analysis.
3 No. 1.
11 (Pause)
13 all talking about and say, of course, we're not trying the case
24 the government.
3 unusual case.
7 $1.9 million.
18 came from Mr. Petrov, and we invested his money, along with
21 money and some of its -- other money of its owners, Mr. Katsyv,
1 complicated because they have to say this $1.9 million were the
6 this very complicated story that there was fraud on the Russian
8 bank.
11 they say came from the Russian treasury, we can identify the
21 claim this money that came from the Russian treasury came
5 we're not going to try the case today, but the government
8 address that.
11 know your Honor has said that we are not trying the case today,
23 records.
6 they have. They have not produced their own tax filings, as
15 July 25th letter within one week from today so that we can know
24 accountant that used to do work, who quit when you entered the
2 everything that our clients have that is called for and not
5 may be some odds and ends after that, certainly within the
10 We set forth very specific documents, their own tax filings and
14 Although, there may still be the need for them in the future.
24 (Pause)
1 letter, which was not filed with the Court and didn't need to
3 issue about that, we may as well deal with that issue while
10 company, and I just told your Honor that the accountant quit
14 we can get them from him, we will do it. But that's No. 1. We
15 have produced all the tax returns of the New York entities.
24 us.
1 respond to the letter. That's all we're asking, and that you
2 order --
3 MR. CYMROT: Well, we've told them the same thing over
8 his name?
19 Right?
25 to the discovery, well, there's a court here you can apply to.
4 possible. And let's leave it at that for the day. All right.
5 Thank you.
10 (Adjourned)
11
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4 Plaintiff,
7 Defendants.
8 ------------------------------x
New York, N.Y.
9 September 2, 2015
2:00 p.m.
10
Before:
11
HON. THOMAS P. GRIESA
12
District Judge
13
APPEARANCES (via telephone)
14
PREET BHARARA
15 United States Attorney for the
Southern District of New York
16 BY: PAUL MONTELEONI
JAIMIE NAWADAY
17 Assistant United States Attorneys
21
22
23
24
25
1 (In chambers)
17 lot of matters there aren't issues that are ripe for your
18 resolution.
4 from among the 167,000 pages of documents which they say they
6 And we disagree on that. They say that since we know the name
12 ruling from the court on? I take it you really want some kind
13 of rulings.
16 us the base ranges about which they say their witnesses are
18 we're asking which ones. And we may be able it work that out,
23 that?
8 to let us know the base ranges of the documents. When they say
15 just a second.
18 right?
3 THE COURT: Well, you are the one who is taking the
4 deposition.
8 agreed they will be off the witness list. As to those who will
18 minute.
20 the part of the defense. In other words, they are taking the
11 request.
15 Yes, to an extent.
16 think is salient.
18 done.
3 there has been best efforts, then I would tend to admit what
7 saying I think what you both have been saying, and really
20 name, but the defense counsel know who this witness is.
24 about.
5 assume you know the names of the people you are talking about,
6 and they don't have to be named on the record before me. But
17 two of us. And if there are more issues that the court would
2 for the expert reports, and we go for October 20 for the reply.
6 week. We think one more week besides what you are saying would
7 be great.
11 27.
17 Honor.
25 dealing with.
11 there is a way that we can avoid the need for the court to
20 and their names are on the papers, and then they're told they
9 now.
13 THE COURT: Thank you both very much. All right, that
15 - - -
16
17
18
19
20
21
22
23
24
25
4 v. 13 CV 6326(TPG)
6 Defendants.
7 ------------------------------x
8
October 1, 2015
9 3:19 p.m.
10
Before:
11
HON. THOMAS P. GRIESA,
12
District Judge
13
15 PREET BHARARA
United States Attorney for the
16 Southern District of New York
BY: PAUL MONTELEONI
17 MARGARET GRAHAM
CRISTINE PHILLIPS
18 Assistant United States Attorneys
19 JOHN MOSCOW
LOURA ALAVERDI
20 VERNON CASSIN
Attorneys for Defendant
21
22
23
24
25
1 (Via telephone)
4 here.
9 now?
11 Moscow here. And I'm with Vern Cassin for Baker Botts and
16 Monteleoni.
17 THE COURT: Now, who was going to speak mainly for the
18 government?
21 asked to have the call about, and to clear up any issues which
25 date.
3 correct me.
9 take the week, which would be a very busy week, taking the
11 who are running the defendant companies. These are the most
12 important people to depose. They are the first people that the
18 on the week of the 12th. On the 12th itself there are already
4 raised very much at the 11th hour. And they're not logistical
16 we would ask for the assurance that we can come to you if there
24 people whose interests are involved here to come here and give
6 with this, we will do our very best to keep this thing going
15 that?
19 expert discovery.
24 discovery?
6 are working on this perhaps more hours a day than is good for
9 December 7 -- just bear with me. I've got to look at this just
10 a little more. Just bear with me, please. I want to get back
4 discovery.
7 the 6th, 7th, 8th and 9th, sorry, on those particular dates.
10 12th. It's very hard for me to see how this could possibly
1 able to move those into the days that counsel is talking about,
2 7, 8 and 9.
24 "them"?
8 etc., for the week of October 5, Katsyv, Litvak and Krit. And
12 depositions is denied.
17 about people where the same passage letter was sent yesterday.
18 And Judge Griesa -- that is you -- said that you wouldn't have
20 persuade them to come in. We are doing our best. And we are
3 have one who knows the case. I understand that the government
7 And we will not have the problems. I'm not talking about the
9 I'm simply mentioning that we are dealing with people far away.
11 a week, and that we extend the deadline until the 19th. And we
16 spoke, right?
22 Monday, correct.
4 trial.
6 about a trial date of December 7. And can I just say, you all
7 know your problems. You know what you're dealing with with the
8 witnesses. You all know it in detail far more than I know it.
11 do.
21 a schedule here on the phone. And I wish that you could agree
22 on a schedule.
25 schedule?
8 We'll try.
17 the next thing after I make a ruling, somebody comes back and
18 says, well, it won't work. And I don't blame you for saying it
19 won't work.
23 adjourn the matter with the Court and to try to work out an
24 agreement.
14 (Adjourned)
15
16
17
18
19
20
21
22
23
24
25
4 Plaintiff,
5 v. 13-cv-6326 (TPG)
7 Defendants.
8 --------------------------------x
11
Before:
12
HON. THOMAS P. GRIESA
13
District Judge
14
15 APPEARANCES
(via speakerphone)
16
PREET BHARARA
17 United States Attorney for the
Southern District of New York
18 BY: MARGARET S. GRAHAM, ESQ.
Assistant United States Attorney
19
BAKER & HOSTETLER, LLP
20 Attorneys for the Prevezon Defendants
BY: MARK A. CYMROT, ESQ.
21
22
23
24
25
1 (In chambers)
5 defense.
12 with the government that there has to be some -- I'm not sure
19 Kingdom.
22 words, they would have to come from Russia and Israel. Is that
23 right?
25 deposed this week, Judge, and they're here. But they came from
5 expensive.
20 Mr. Cymrot has stated. He has not stated that they cannot pay
21 the money. He has not set forth any basis for the hardship
3 seized, as they were here pursuant to the order that your Honor
5 that the parties must follow, and they must show that -- they
7 they must -- and I'm quoting from the statute that Congress has
8 passed to deal with this, 983(f) -- they must set forth the
15 things, to show why exactly they need the money. Without such
18 precedent.
4 the $15 million. That is the theory on which the money was
5 restrained.
7 How much money laundering -- how much laundered money came into
8 this country?
11 dollars.
16 because the statute sets forth the basis to seize money that
25 that has been fully briefed. The issue put forth is really the
1 facts that the defendants have to set forth the reason that
2 they need this money and the basis for their request. And they
3 have not done so. And that is all that the government is
4 asking.
23 somebody has so much money that they don't care about it, well,
24 for most people, most human beings, coming from Russia and
2 that burden.
17 Honor.
22 the complaint and the protective order, we would again ask two
23 things: that the defendants set forth their actual need for
25 least present receipts for what they have spent, rather than
2 that the defendants set forth their actual financial need for
11 demonstrate their actual financial need for this money and set
13 THE COURT: When you say "as they are required to do,"
14 I know the statute you are speaking of, but the Court has some
25 o0o
4 v. 13 Civ. 6326(TPG)
9 November 6, 2015
2:51 p.m.
10
11 Before:
13 District Judge
14
APPEARANCES
15
PREET BHARARA
16 United States Attorney for the
Southern District of New York
17 BY: PAUL M. MONTELEONI
KRISTY PHILLIPS
18 MARGARET GRAHAM
Assistant United States Attorneys
19
BAKER & HOSTETLER, LLP
20 Attorneys for Defendants
BY: MARK CYMROT
21 JOHN MOSCOW
22 - also present -
24
25
14 rely upon that witness and a new theory of special crime, U.S.
22 that changes the specified unlawful activity, and they now, ten
3 summary judgment?
9 MR. CYMROT: And you had told them not to file but
20 fraud on the bank based upon the fact that certain corporations
9 minute.
14 documents?
19 documents.
21 deposition.
5 Switzerland.
13 representative of an entity.
1 deposition?
5 motion?
7 and after they filed the summary judgment motion relying upon
13 this afternoon?
24 disclosed and --
7 has said several times this case isn't principally about what
14 laundering predicate.
20 proposed order that has a few fact findings, and it just says
21 that (a) that the Court, if you agree, would grant partial
2 way so that the trial will be about what happened with the
3 defendants.
7 records about what were HSBC's legal fees, because those legal
8 fees were out-of-pocket harm to HSBC and that makes the offense
6 place?
9 time to --
13 They said they wanted to go to the backup dates which are much
14 later in the month, and that would have been fine except that
15 now they're saying that the whole summary judgment motion needs
18 that out last night, we have been on the phone with HSBC trying
19 to see if they are available some other time next week so that
21 next week --
10 disclosure that was made on October 22nd and a motion that was
19 THE COURT: Look, look, I'm not trying the case this
20 afternoon.
22 THE COURT: I'm not trying the case. I'm dealing with
23 pretrial matters. And what I'm told is that there has been
1 and decided. I'm also told that there is a deposition that has
6 deposition.
12 central documents to this new theory, and it's all too late.
24 argue that today. But it's all new, that's the point. The
25 point is it's all new and we've had no discovery. And it's too
1 late --
20 (Pause)
5 Switzerland --
7 activity?
9 affiliate of this bank but not this bank, and it's a different
10 fraud.
14 bank based on the harm to the fund, based on the harm to HSBC
20 of docket item 310 -- the fact that HSBC and Hermitage lawyers
25 bank." And we've provided the bank records that prove that,
1 which is that HSBC, yes, through a Swiss HSBC entity but still
5 we are able to get those details from HSBC, but they're just
6 filling in the picture that this case has involved from the
10 show our theory, and we're trying to give them more documents
19 (Pause)
22 investment fund that owned the companies that were taken over
25 the complaint.
6 records.
16 (Pause)
19 is. You are talking about things all of a sudden that I don't
23 that can be briefed and I will have the briefs, the papers, and
18 gone on thus far, you'll need to file some papers. That's it.
3 that right?
6 under your local rule that we should file letters before filing
13 documents.
15 privilege?
17 the money went through Moldova -- the money from the Russian
20 and where?
25 asked for from the Moldova government to see what they got
16 request or what?
18 government-to-government --
4 The officials who were handing us these bank records said that
5 they were bank records. The defendants could have asked the
7 questions about what was said, but as far as the documents that
13 how they keep their bank records. But there are charts of the
14 inflows and outflows into accounts and then there are a bunch
15 of payment orders, and those have all been turned over. They
19 for bank records, it's pretty trivial but I can certainly say
22 communications.
24 they requested bank records and the bank records were produced.
4 their case has changed, and we do not know what scope they
5 asked for and we do not know what the Moldova government sent
6 back and said what it was; we don't know that. He has been
7 making representations --
9 government sent?
13 know what bank records look like. This does not look like bank
14 records.
20 the records for the accounts that these are the records of.
23 they leave out? And what accounts did they ask for that they
25 don't know any of that. And this does not look like bank
10 and they keep their bank records the way they keep them.
18 what was asked for and we're entitled to know what we got other
23 the case --
7 give you notice of this. You didn't ask about this. This now
12 entitled to know what was the scope of the request, what they
13 got, what they didn't get, what they didn't ask for. We know
19 MR. CYMROT: We say no. They say yes. They say this
21 agree.
10 the case.
13 day one.
20 right now.
23 they asked for something -- we don't know what -- and they got
1 give it to us.
2 THE COURT: You mean, you don't know what they got
3 back?
9 account.
23 produced.
24 MR. CYMROT: What did they ask for, Judge? What did
25 they ask for? What did they get? What did they ask for? We
6 All right?
14 turned over.
17 think --
5 telephone book, and what happens is there are ways to get the
12 cross-examine him.
16 from?
18 Economii in Moldova.
3 the government.
6 you can make out what the words are. That's the form that we
10 asking for.
15 from Moldova --
21 it.
2 are talking not just about Moldova but all of the government
3 correspondence government-to-government?
5 means.
14 Next point.
16 governments?
22 Mr. Browder is the one who brought this case to the government,
3 the documents on their witness list for Mr. Browder and his
4 associates.
22 says, at the USAO's request. But Mr. Hyman says Mr. Browder
3 communications.
16 about the crime and information, but we're not bringing the
11 witness list.
16 Honor.
18 identification.
22 pages.
1 from me?
9 this.
14 be produced.
23 and defense relies on, then maybe it can be overcome. But when
13 government case.
15 (Pause)
3 Next point.
7 that even --
3 Mr. Browder you know brought this case, and this is information
12 please.
13 (Pause)
21 (Pause)
9 witness --
23 step.
24 (Pause)
1 Browder.
4 Hermitage employees.
14 this device.
17 then you can forward that request to the government and they
18 can respond, and if there is an issue, the Court can rule. But
20 Next point.
16 of these.
18 Next point.
24 entry.
12 asking for what a third party did, the summaries and analyses,
13 what a third party did allegedly to put money from the Russian
19 turned over. After that the government asked for various types
20 of analysis, not just that but other questions about the case.
22 should be Excel files there, there were a few things that the
4 analysis.
16 that does not deprive the defense of getting the facts but
18 You make document requests. But you don't have the government
19 doing your work for you. Not that you really want that, and I
8 "related matters."
13 this, please.
14 (Pause)
3 a pen.
12 request."
15 that passage.
18 (Pause)
4 scheme.
9 independently.
14 States --
16 is overruled.
25 about that were the focus of his oral remarks, those have been
8 important. That is not the case with the next item, which
11 (Pause)
14 (Pause)
20 Next item.
1 The next one you've ruled on, your Honor, which is the
5 reports."
11 afternoon?
14 (Pause)
22 following.
2 They came back and said there are no such documents because
16 evidence that our clients received the money that the U.S.
18 files.
20 it.
1 counsel said.
4 produced the records that we have and that the people who were
8 And then the Court ruled. And what you ruled was that
16 this case.
23 September 24th?
2 investigation."
11 No more. No less."
23 really, it's just not part of this case. And there's no way
2 case.
9 September 24, 2015, the Court ruled that because this case
23 didn't do, which we just don't know, it was not relied on and
6 haven't asked.
8 documents to us.
10 this matter.
13 counsel.
14 (Pause)
19 response to my request?
4 - - -
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
4 v. 13 CV 6326 (TPG)
11 Before:
13 District Judge
14
APPEARANCES
15
PREET BHARARA
16 United States Attorney for the
Southern District of New York
17 PAUL M. MONTELEONI
MARGARET GRAHAM
18 Assistant United States Attorney
21
22
23
24
25
5 government.
8 Cymrot.
11 can state what you would like to, what you believe the issues
19 all. And they claim that there's work product but the work
1 know what documents the government has asked for and what it
3 documents which we have been from the very beginning and the
5 documents.
8 documents?
23 THE COURT: I'm sorry to tell you that you are going
24 too fast for me. I don't have the background you have and I
1 what are the documents in question? What are they? Can you
2 describe them?
5 cannot tell you with precision what they say because the
19 and they have given stuff that is not based as on our analysis
22 will be able to prove as we can with some things that these are
25 that Hermitage has given and that the government has received.
8 committed.
13 that convenient.
19 government.
22 November 6?
7 (Adjourned)
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
11 Before:
13 District Judge
14
APPEARANCES
15
PREET BHARARA
16 United States Attorney for the
Southern District of New York
17 MARGARET GRAHAM
PAUL MONTELEONI
18 CRISTY PHILLIPS
Assistant United States Attorneys
19
BAKER & HOSTETLER, LLP
20 Attorneys for "The Prevezon Defendants"
BY: JOHN W. MOSKOW
21 LOURA ALAVERDI
NICK ROSE
22
23
24
25
1 (Case called)
12 and I think this has been done through letters and that's
1 to his home?
8 here for the trial and that the subpoena served on him must be
16 frankly, we are --
22 has been here for months. They have been paid for by the
24 have been provided money for food, rent, telephones and other
13 like to make --
19 in fact thwarted --
22 going to his interest and his bias and his dealings with the
24 things. So, when I asked him who met him at the airport he
24 agreement.
8 already been deposed for seven and a half hours and he has made
10 statutory law of the Russian Federation and his own ethics code
15 wishes to ask this witness about, other clients that he had and
1 had them months before they deposed him. They asked him
7 be deposed, right?
15 testify to?
18 procedure by which --
1 went to the court that houses the court file, he spent several
6 drive and found that in fact the pictures on the hard drive are
11 him?
15 pictures?
19 the bank statements that show that the money ultimately went to
23 the pictures on the hard drive are the pictures that I took.
24 THE COURT: How did the government find out about that
25 he did it?
6 further.
9 about?
13 have him deposed about what you have just been speaking of?
16 documents.
18 days for seven and a half hours of defense deposition and two
24 left to do.
9 to the government and what was missing was any reference in the
16 pictures but not the data. He does not affirm nor does he deny
19 or April of 2014.
1 questions like who are your clients. I am not asking what did
6 recall.
13 the deposition and get a ruling of the Court. Now, that's not
19 We can get you page cites where the answers were evasive or
7 transcript and you apply for what you want to apply for.
14 questions.
2 will make rulings of the kind that I would make under our law.
7 will make rulings and that will be that and we will have a
9 Thank you.
11 this?
15 standard for when these privilege issues come up. They do come
21 law applies, this is not one of those cases and that really
24 important to --
4 it doesn't.
15 o0o
16
17
18
19
20
21
22
23
24
25
4 v. 13 CV 6326 (TPG)
11 Before:
13 District Judge
14
APPEARANCES
15
PREET BHARARA
16 United States Attorney for the
Southern District of New York
17 PAUL M. MONTELEONI
MARGARET GRAHAM
18 KRISTY PHILLIPS
Assistant United States Attorneys
19
BAKER & HOSTETLER, LLP
20 Attorneys for Defendants
MARK CYMROT
21 JOHN W. MOSCOW
22
23
24
25
8 could have openings and so forth start the 3rd. I have been
13 has not been fully briefed. And how that will come out and how
16 maybe -- you all have much more precise ideas of trial time
17 judgment has not been acted upon and I hate to ask this because
19 view, but I will ask anyway. If the motion for partial summary
3 possible it might not get done before Christmas Eve. So, there
10 summary judgment?
2 decide.
4 rule on it today.
11 one of the three elements. It's sort of the first of the three
21 away the need for the jury to deliberate over one of the three
24 that.
11 second element; and then also we think perhaps the bulk of the
18 laundering.
23 I've said this already -- but we're now at November 19. Today
4 question that involves too much uncertainty, you can tell me.
7 it.
11 little less.
4 there's more than enough time. And what we're going to suggest
5 is that you divide the time between the parties and keep them
7 both cases.
21 jury deliberations start let's say midday the 17th and at the
4 that.
10 25 hours.
17 own case. So we would say that, given what you would like, we
18 should start the trial on the 3rd and that you ought to divide
19 the time between the two parties and let them present their
22 You said this but repeat it. What do you think the
1 think that some artificial cutoff of how many days either side
8 Honor that you should grant the continuance which I'm sure
22 schedule.
25 than two years. And you've said this is the trial date. And
1 everybody has known that for quite a long time. And this is
13 selected.
16 start on the 3rd. Now, if we have the trial start the 3rd,
17 we've got the 3rd, the 4th, and five working days the following
1 could include in our working days let's say Monday and Tuesday,
4 14 working days.
6 I'm wrong --
8 suggestion?
11 who is the Russian lawyer for the defendants. And if you can
16 in January.
18 yours.
11 family.
14 6th.
21 cocounsel?
22 (Pause)
6 (Pause)
14 situation that just comes with the breaks of the game. What I
15 would like to do --
1 dealt with.
5 date.
9 do this afternoon.
11 if I may.
21 because as the Court knows the adjournment isn't that long and
5 cooperation from the other side. And then if there are any
9 sides.
18 file an answer. It's what the rules require. And now they
4 Plaintiff,
5 v. 13 CV 6326 (TPG)
11 Before:
13 District Judge
17
BAKER & HOSTETLER LLP
18 Attorneys for the Prevezon Defendants
BY: JOHN M. MOSCOW
19
22
23
24
25
4 time you speak. And I think that I was told that this call was
12 back at about 1:45 and said that the defense was no longer
14 square one; so --
2 our filing on that until two weeks from the 17th, which would
15 would be fine.
18 depositions. The defense has more than that between now and
21 instructions.
3 due to the very late nature of our being told about it.
7 that's in lieu of dealing with the other legal issues that are
8 arising.
10 MR. MOSCOW: I'm sorry. I'm you asking for two weeks
6 for me.
16 questions.
20 ask -- I know this has been answered a lot, but I'm going to
21 ask it again because I want to get started and take things step
22 by step.
3 questioned?
7 to do it on the telephone?
10 New York.
14 correct?
2 limited issue.
13 additional time.
16 are imploring the Court for two additional weeks because we are
17 buried.
22 Is that correct?
17 put off for two weeks so that we can deal with all of the
21 weeks.
1 to reply, be put off for two weeks so that we can deal with the
4 buried.
8 those dates --
20 that motion?
19 that correctly?
24 speaking?
4 trial.
13 before trial.
15 a Monday trial would not give the Court time to decide it, and
21 extension than they get, so that it's still before the Court in
23 that the parties know what the issues to be tried that are
8 all, and to the extent that the absence of testimony means that
14 the 4th.
23 Court to what effect? I know I've been over this many times,
15 on a very small number of facts, but could take off the table
17 to try at a trial.
22 motion, we would agree that they could have a few more days.
25 could drastically simplify and focus the trial, and the Court
5 propose, they will have already had the two weeks that it's
6 gone on until now, and then several other days after the
12 trial.
20 that there was, quote, fraud in Russia, but what the specified
6 summary judgement. Now, when Mr. Monteleoni says that it's not
10 that they have proved one without saying what it is, other than
11 fraud on HSBC Switzerland, and that way, they will shorten the
20 to take off the table one of the things the government could
21 never prove.
6 and when I have a new SUA come in after the filing of the
14 phone. The reporter will still be here, but my law clerk wants
15 to give me what she has in mind, and I would like to hear her
18 Okay?
7 it, but we don't want to run into the trial date, and here's
11 motion, and that can be held at a time which we can agree on.
15 argument, but that's the way I want to leave it. We're going
18 we're going to run right into the trial, and we can't do that.
24 received.
10 case, and I've gone over the circumstances and the issues that
13 arguments and making the rulings that I have to make, but that
18 to argue before the Court, but it seems to me, the way that it
5 think that's all we can say this afternoon. Thank you very
6 much.
18 morning.
21 Mr. Moscow?
24 and I'm not going to be asking the HSBC Swiss to get up early
5 and at that point, we may have to call you. That's what I will
6 tell you.
9 scheduling took into account the need to have the witness ready
16 will answer the questions. If there are issues that come up,
17 I've given you my phone number and my cell phone number, and I
20 I've given you the numbers, and that's the way we have to leave
21 it.
1 cell phone number and you've got my law clerk's number, and I
7 (Adjourned)
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
4 Plaintiff,
5 v. 13 CV 6326 (TPG)
7 Defendant.
8 ------------------------------x
New York, N.Y.
9 November 9, 2015
2:00 p.m.
10
Before:
11
HON. THOMAS P. GRIESA,
12
District Judge
13
APPEARANCES
14
BAKER & HOSTETLER LLP
15 Attorneys for Defendant Prevezon
BY: MARK A. CYMROT
16
KOBRE & KIM LLP
17 Attorneys for Non-Party William Browder
BY: MICHAEL S. KIM
18 LINDSEY WEISS HARRIS
19
20
21
22
23
24
25
21 the complaint because there were false tax returns for refunds
22 that were filed that led to the $230 million theft the
11 Mr. Browder, and your Honor said go try to get it from the
14 Mr. Kim has given us some new documents, but we want to take
17 need, based upon the government's new position last week, some
23 recall, your Honor, that he's the one who brought the case to
1 lawsuit.
10 ultimately, I'm not sure with that much help to the rest of the
11 case.
1 took it, and they took all seven hours and asked him numerous
9 Mr. Browder, that they had other documents they wanted to ask
10 him about, despite having taken the full allotted time under
20 which has not been made, I would submit that the Court should
1 document requests?
14 substantial overlap.
18 or did not have good copies of, etc. We then went through and
20 fit that criteria and produced it. The result of which, your
23 because as your Honor can see from the chart, everything has
3 Mr. Browder.
8 Mr. Kim said about what happened. What happened was your Honor
9 did not deny our motion. You said go try to get it from the
11 documents.
20 unsuccessful.
23 over which Mr. Browder gave things to the government and the
3 and you said go and get it from Mr. Browder. That's one of the
5 right.
14 and came up with the new theories last Tuesday. The new
19 from.
21 don't want to ping pong this back and forth because I want to
4 verifiable.
8 Mr. Cymrot said, but I will await what the Court would find
23 Am I right on that?
1 you said it, but I'd like to hear again from Mr. Cymrot, you
7 bank, HSBC Guernsey, that was the trustee of the Hermitage Fund
11 a theft.
17 said that they were not accurate, those affidavits were false.
24 telling me.
5 I would also add, your Honor, that the very topics that
11 You said there were documents that were withheld. The trust
19 addition to what has already been taken, and comes forward with
25 something illegitimate.
3 But I don't need to know it. The good faith of the lawyer
4 seeking to take the testimony is the main thing that I rely on,
5 and here, I have no doubt about the good faith of the lawyer
13 Honor.
5 reason is --
18 and the travel costs don't mean anything to him. But for most
1 the way --
15 or less, given the few topics that Mr. Cymrot just articulated.
16 And number three, limited to the topics that Mr. Cymrot just
24 But the fact is that to impose on Mr. Browder all of the burden
2 the Court and by parties in this case, getting this case ready
9 non-party.
23 lawyers.
2 do it.
6 make a ruling and to cut it off. And that's the way I want to
7 leave it.
11 that right?
25 clients.
4 Kim for Mr. Browder. I think on that last point, two points.
5 Two requests.
13 conference.
16 expenses, and has not done so. We would request that your
19 can occur.
24 paid the $10,000, it is our fault, and we should pay it, and we
25 will promptly pay it, and I'm sorry about that. I don't think
1 I was informed about that. I'm sure I was told at one point,
2 but I dropped the ball on it, and I will pay the $10,000.
15 o0o
16
17
18
19
20
21
22
23
24
25
4 Plaintiff,
5 v. 13-cv-6326 (TPG)
7 Defendants,
8 -and-
6 the motion?
13 trial.
24 the elements.
7 you have to prove that the defendant has intent. So now our
12 predicate offense.
24 law.
1 details, not the way that this fraud was committed, but they
6 they have to admit it, because everyone who has looked into
20 reply papers.
9 that we agree with their story. We don't agree with it. But
14 predicate.
24 partially judged?
11 partially find?
13 in Russia and that that fraud was a fraud not just against the
15 bank.
4 HSBC, right?
7 statute.
11 Rilend, R-i-l-e-n-d?
13 that are held by the Hermitage fund. The three HSBC entities
25 THE COURT: And I know you said this a moment ago but
8 and HSBC Suisse are each foreign banks that were victims of the
9 fraud scheme.
15 (B)(iii).
17 It is a predicate offense --
20 laundering.
22 would you mind going back over the three elements, please.
5 unlawful activity.
7 in what?
17 right?
25 right?
25 the investment fund. Those companies are Rilend, the one you
13 the foreign banks were manager and trustee of. So they were
22 THE COURT: Wait. Say that, the latter thing you just
8 victims of that.
10 direct way.
16 the fact findings that set forth just the very barebones
22 the fact that the fraud was committed and based on the
24 HSBC Management and HSBC Guernsey and which show the depletion
2 activity.
5 activity.
9 the funds from these tax refunds were moved through a money
20 knew or were willfully blind to the fact that these were the
24 with them, and that they knew what they were doing.
3 right?
18 that there is no dispute about the fact that there was fraud
5 Hermitage fund. They were not illegally taken. And the fraud
7 that those three companies were stolen. And I can hand you up
9 motion does not contest that that fact is disputed. And they
11 Mr. Monteleoni just told you that those companies were stolen,
22 Rilend and companies, "away from Hermitage and HSBC, the motion
10 And then say there was a provision made where this $1.9 million
14 the basis for the reservation of the $1.9 million. That is the
16 The facts are disputed. And there are many facts that are
19 shown that Mr. Browder, who is the Hermitage fund, and HSBC
2 will say, what are the proceeds? What are the proceeds? We're
10 claim when there are no proceeds that they are proving are
11 being laundered?
13 these three companies are not foreign banks within the meaning
20 statute.
22 beyond you, your Honor, but the point of the matter is, as a
2 upon which relief can be granted. There is only one that they
3 have asserted that states a claim. And that's that the fraud
6 But that is the only one that satisfies a claim. All right.
7 If you were to limit them to bribery, they would then have the
21 that reason also. We can make the case narrower as you want by
3 after the theft of the Russian treasury, there were legal fees
4 that were paid. Does that sound like fraud? I don't know any
5 fraud that sounds like that. Eight months later, with many
10 They don't cite any fraud cases. Where are their cases? If
18 statute says.
24 memory of what I've done in the case that these facts occurred:
1 that I won't try to recite at the moment. That there was fraud
5 can't just walk into the Citibank branch in Brussels and say,
8 Obviously the fraud was not committed without the idea that
12 were handled in such a way that some of them came to the United
16 obtained illegally was dealt with the way illegal funds get
18 the funds into a form that can benefit the criminals. And the
20 laundering.
24 investors.
1 never --
21 corrected.
25 good correction.
11 has shown beyond any triable issue of fact that there was a
14 THE COURT: OK. And that it's made that showing, the
21 disputed as to law.
5 They submitted what they had -- the government says they were
16 have proven that the certificates that were used to make the
17 tax returns, the tax filings were certificates that were not
24 that --
11 relying on the fact that there was fraud committed against HSBC
12 Guernsey, right?
14 companies.
20 laundering predicate.
9 right?
12 Guernsey had the duty to make sure that the companies in its
14 by fraudsters.
17 that there was fraud in Moscow from which 216 million dollar
24 that money.
7 laundering.
6 that. Right?
8 yes.
12 basic fraud.
5 again.
16 also HSBC Guernsey, also HSBC Management, and also HSBC Suisse.
23 you win that motion, it still leaves for trial the conduct of
1 was.
2 MR. CYMROT: No, your Honor, not the way they say it.
3 THE COURT: I'm not asking about the way they say it.
19 occurred in Moscow.
20 MR. CYMROT: No --
17 the fraud occurred, but also a few other details about the fact
20 slower.
22 the Court to take out of the case the undisputed details about
25 facts that it's asking are for the Court to find that the basic
1 fraud also victimized HSBC. And the reason that it's asking
8 real dispute on the papers, then that is the order that the
9 government is seeking.
17 looking at the papers for the moment. Let me ask you this. In
18 other words, in what you talked about in the last few minutes,
19 you talked about what I'll call two phases of things. One is
23 fraud.
5 challenged.
8 there's a hallway out there, and you are welcome to use it and
11 this.
16 different question.
19 what I'll call two phases of what you just said. One is the
25 THE COURT: OK. Now, what you're saying is, what the
3 genuine issue of fact about the idea that there was a fraud
18 Moscow.
21 that area. Phase two, that there was a fraud on HSBC, is hotly
22 contested, in many ways. And you cannot take that out of the
1 THE COURT: What are the issues about HSBC that you
2 just mentioned?
11 knew about them, so they were not false lawsuits that some
14 involved.
20 been disputed with very specific facts. And what it comes down
23 this, and the evidence points that Hermitage and Mr. Browder
14 summary judgment presents some points that are very well taken.
17 But some things are not in dispute. And I keep referring and
8 are not in dispute and wasting time on things that the jury
10 frame the issues so we don't waste time on things that are not
12 way that will be meaningful to the jury. That means that the
14 And with that we will adjourn for the day. Thank you.
16 o0o
17
18
19
20
21
22
23
24
25
4 Plaintiff,
7 Defendants.
8 ------------------------------x
New York, N.Y.
9 December 3, 2015
3:00 p.m.
10
Before:
11
HON. THOMAS P. GRIESA
12
District Judge
13
APPEARANCES (via telephone)
14
PREET BHARARA
15 United States Attorney for the
Southern District of New York
16 BY: PAUL MONTELEONI
MARGARET GRAHAM
17 Assistant United States Attorneys
22
23
24
25
7 conference.
12 items.
19 analysis and work, and I appreciate it, but let me put it this
23 have use in some way at the trial, but the trial has to start
4 could accomplish?
13 are certain facts that are necessary to put the other facts
3 understand.
14 are not in dispute but that actually, you know, require a lot
21 think that in each case it's a page or two, and that that's a
24 fraud.
5 Mr. Monteleoni and see what he has in mind, and it seems like
3 good.
20 read out.
2 in both ways.
4 stipulations before; this is not the first one I've ever seen.
12 understand.
15 will eliminate the need for considerable proof, but the use at
5 endeavor to do that.
7 you have worked out and you are continuing to work out a
10 there will be certain things that you believe are not subject
13 current view is that if there are such things, that they will
22 countries, etc., etc. So, what you are doing, both sides, is
3 of evidence.
7 paragraphs that mean nothing to the jury. So, you are going to
12 me you are all doing what you need to do. Just a minute.
17 as well.
19 about?
23 in limine.
2 other references.
11 certain testimony.
17 that.
21 hearing?
13 limine, so those are the dates, the 23rd, the 24th, the 4th and
14 the 5th are the days after a full briefing of those motions
19 the court wishes argument, then those four days, the 23rd,
6 can be available.
11 you call them, I don't care. But there may be issues about
20 decided at trial.
23 and they are ruled on at the trial. And the thing is what
24 happens is that by the time these issues come up, the court and
25 the jury have heard some evidence, they have some background,
3 that witness, that the court can deal more intelligently with
12 for that. What date do you propose? A date, not five dates.
13 A date.
15 January 4.
6 the January 4th date, and it would help just give clarity to
7 the parties.
11 something tomorrow that gives you what we have agreed to, which
13 hearing.
16 that got worked out and that got submitted both sides were
17 onboard with.
19 so...
1 don't enter orders about these details, but I don't think there
10 have that.
14 out in some order in advance, but if you want it, I guess it's
15 OK.
23 list.
25 speak to that?
5 potential bias that could come from the fact that we have
2 advance of your summing up, so you will know what I'm going to
4 the case. So, I want to go over that with you and hear your
5 views and your proposals, and then I will let you know in
8 You don't need to know what the court will say about
9 the role of the court and the jury, but you will need to know
13 question?
21 have to assume that the verdict form will include a few very
3 all good trial lawyers, and I've certainly tried cases, and it
5 point when you know when the summations are going to occur,
6 when the parties are going to rest, and we will then in advance
8 Exactly what minute of the day that will occur, I don't know,
12 government.
14 Honor.
21 (Adjourned)
22
23
24
25
4 v. 13 CV 6326 (TPG)
11 Before:
13 District Judge
14
APPEARANCES
15
PREET BHARARA
16 United States Attorney for the
Southern District of New York
17 PAUL MONTELEONI (by telephone)
Assistant United States Attorney
18
BAKER & HOSTETLER, LLP
19 Attorneys for Defendant Prevezon
SAMIR RANADE
20 NICK ROSE
21
22
23
24
25
10 THE COURT: And you are here from Baker & Hostetler?
16 defendants.
2 December 7.
6 and the cross deposition was noticed for January 5, 2016. That
12 and he did not come in for a deposition today. And we had this
18 and I don't want to get into the subject of what might have
19 been done differently. What has been done has been done and we
22 taken place today who was going to question him? Because there
3 interested.
6 please.
1 today.
5 Kim.
7 today?
20 single session.
24 this.
25 (Pause)
2 confirms what you have just said, that is that the attorney for
3 Mr. Browder, namely, Mr. Kim, K-I-M, stated this morning that
6 January 5.
8 with that is it's the day before jury selection in this action.
14 the trial and that's why we had noticed this deposition much
24 party wanted to ask questions which were not covered today then
6 this.
19 least.
1 done.
5 that and that's the way we'll leave it today. Thank you.
6 (Adjourned)
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
4 Plaintiff,
11 Before:
13 District Judge
14 APPEARANCES
22
23
24
25
1 (Case called)
4 in limine.
9 are made.
11 trial and I've got much better background to deal with the
14 I'm sure that by the end of the trial, all the issues
18 opening.
23 If you want to deal with those right before the opening, that's
3 trial.
5 dealt with as the issues came in, but there are a couple of
13 doing now, how they'll be dealt with and how they will be
15 January 4.
18 other things that you all have in mind. But I've got the issue
7 the government filed this cross-notice for the day before the
22 He was in New York last week for four days, and that
24 your Honor --
13 rhetoric.
15 your Honor.
17 that.
22 and by Mr. Browder that are all over the press in Russia and
2 New York"? It hasn't been all over the press that I read.
21 going to do that.
23 New York next week for his deposition because he won't give us
24 a date.
3 videotape from London when he was here for four days last week,
7 dates are set forth also in the letter from Mr. Browder's
10 dates are --
24 I don't know how much testimony the defense wants to add to the
10 December 28.
13 on December 28.
15 prejudicial.
19 married on the 29th, and I'm the one taking the deposition.
24 to me that --
7 will take place on the 18th and work out the timing. What's
12 we'll have plenty of time. He was in New York for four days
15 doesn't help.
24 period.
17 of --
20 18th and the 19th. Your Honor, if you direct it, it's going to
22 You've seen this. Just say the 18th and the 19th.
25 available on the 19th. The 18th and the next available day is
5 has to continue beyond the 18th, you will work it out. Next
6 point.
8 position. If you say the 18th and the 19th, that will be
9 followed. If you say the 18th and some other date, it will
15 done. Start the 18th, and both sides will have an interest in
16 getting it done.
4 think that there shouldn't be a rigid date set that the witness
7 October 13. We've been doing this for two months. You must,
12 the 18th.
16 18th.
24 denied.
2 your Honor.
5 (Adjourned)
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
4 Plaintiff,
11 Before:
13 District Judge
14 APPEARANCES
22
23
24
25
1 (In chambers)
5 clear but what has happened is that I've received from the
7 motions in limine.
9 the first time I'm saying it for the first time, I generally
18 to do it is at the trial.
3 that evidence I'll rule on the objection. That is the way the
8 something?
16 until later into the case. But if I could just list those
20 are a few issues in our motions that if we can just get the
2 one of Mr. Katsyv's companies entered into more than ten years
15 Next point.
17 the Magnitsky law, and I'm talking about the act of Congress,
22 case.
24 Magnitsky law itself in the opening then we can put this issue
25 off also.
2 on that either.
4 open on?
7 government.
11 court.
13 in opening?
17 about well the law says this or the law says that. We're just
1 also -- even if you don't say the word "law," that counts under
18 hearing.
23 MR. CYMROT: Before you move on, Judge, can I just ask
5 do it.
11 opening, if I may.
21 Office. And we think that it's very important that that aspect
22 is not part of the case and not yet brought into the case. So
19 their motion. Number -- I'm not really clear about their five.
20 Let me go to six.
1 they did certain things, that they didn't do other things that
5 to be decided.
12 going to get into legal theories with the jury. On the other
5 appropriate.
10 them about it and they still haven't indicated that they are
19 But they won't give it to us. And we've been asking for it.
22 court.
24 production.
3 and unless your Honor needs it we're not going to spend $25,000
4 to translate it. And I would say, your Honor, you could hear
9 to do it.
11 But can you identify the Bates range under which you produced
13 you.
3 that they wrote. We're not asking for any documents that they
9 them.
11 exhibits at trial, we'll just take them off the list and not
21 they're not relevant and in any case they reflect the choices
24 We're not planning to use them. And I don't know that they're
1 the defense team to say what was collected and what wasn't.
9 for that from the defendants. We're just asking for the
10 documents that were made not for this case. They were made for
11 other cases. And defense counsel is now saying well the fact
12 that they thought that this was relevant would reveal their
24 issues on January 4.
6 since this wasn't on the court's agenda for this call right
24 trial.
8 court documents that the government has not been able to gather
19 relevance of it and certainly the fact that our team used its
25 be produced.
3 documents that were created, to the extent that they are in the
10 has covered what the issues you're talking about so I'll just
11 ask: Has what I have said covered the issues you have raised?
15 already existed.
17 Did what I just say now cover the issues, Mr. Monteleoni?
24 covered today?
3 (Pause)
15 MR. MONTELEONI: 1, 5, 6.
21 days.
1 Honor.
7 We'll do that before January 4 and you may want to discuss them
8 on January 4.
16 (Adjourned)
17
18
19
20
21
22
23
24
25
4 Plaintiff,
5 v. 13-CV-6326 (TPG)
11 Before:
13 District Judge
14 APPEARANCES
24
25
1 (Case called)
3 Honor.
13 this motion?
23 that same law firm, Baker & Hostetler, having been retained in
25 were involved in that fraud, this very same law firm, your
7 retained, right?
17 figure out who else may have been responsible for that crime.
21 firm.
24 and Mr. Moscow to try to help them figure out how to defend
25 themselves against being framed for this fraud, and they talked
3 responsible for the fraud and maybe even try to forfeit funds
4 that were proceeds from the fraud. The trial that is now
9 forfeiture.
12 issues, right?
17 now being accused by this law firm of the very fraud that they
6 activity was, was the source of the funds at issue in the case
12 again?
19 of this, and the evidence points that Hermitage and Mr. Browder
20 Absolutely.
24 green arrow that says Today, and we've selected a few quotes
25 from Mr. Cymrot's law firm, Baker & Hostetler, and so I'm just
1 going to read it into the record for your Honor one more time.
2 What Baker & Hostetler said in open court, again, about their
4 and Mr. Browder did it. What are they talking about there?
7 in January.
11 Prevezon.
13 he was representing?
18 that you denied a year ago a similar motion. But if you listen
20 things are very different now, and on the very same page that
21 you're looking at, Judge, two boxes above that one, right below
23 transcript, and here's what Mr. Cymrot said at that time. This
10 issue, the case has changed. And whether they knew it was
14 is not only at the center of everything but that they "did it."
18 counsel trying to frame them for the very same charges that
19 they hired them to prevent them from getting framed about back
20 in 2008.
5 and so this is how Baker & Hostetler's conflict was smoked out
6 recently, your Honor. The government came into court and said,
7 let's just have you, the Court, rule as a matter of law that
17 intent. And the response from Baker & Hostetler was, not so
18 fast. Baker & Hostetler was not willing to concede that there
21 that the real people responsible for that fraud were none other
25 stand for?
5 locale.
8 where things were a year ago. And that is why Mr. Cymrot said,
16 exactly opposite to what Baker & Hostetler told you a year ago
17 that has brought this into such sharp relief, because a year
20 Mr. Moscow stood before you and said they all could be
4 he now says, "The evidence points that our former clients did
5 it."
10 case by framing my client for the very same fraud that it was
14 this fraud. It's really that simple. And now Baker &
23 And now --
25 right?
4 now --
6 Hermitage.
8 they have stated that evidence points that Hermitage did it.
9 That is what they are alleging now, that their former client is
16 year, and you ruled on it, and you ruled against them on every
17 legal point. And what you said at that point was, this is not
18 the same proceeding. It's not the same proceeding. It's not
22 verdict in this case. Indeed, your Honor, the jury will not
4 this wasn't that case back then in 2014 when you ruled and that
5 it's not the same case now, it's the very same allegations in
12 to be a finding that they did it. The jury's not even going to
14 back a year ago, and you said we could defend our case without
15 inhibition.
18 has now said he's not coming to trial. Maybe the jury will
20 he's gone from being the key witness -- they called him back
22 who's not showing up at trial and we'll show some video clips.
23 unlawful activity.
2 You said -- and the client relied upon this, we relied upon
5 whether our clients got money from the $230 million fraud. The
16 idea, the same fraud, the same facts, have not -- this is the
18 2014; the same $230 million fraud, the same allegations that
25 Honor?
2 please.
5 right?
22 counsel, right?
11 $230 million fraud that has been involved since the beginning
12 of the case, but the jury will not be asked whether Hermitage
24 traced to Prevezon.
5 there, Judge.
14 and the case has changed." You made that statement, did you
15 not?
20 quoting --
25 MR. CYMROT: Yes. I'm not sure what the 9th was and
1 what I was referring to there. They only give you a few words
3 judgment here.
5 "Every step of the alleged fraud against HSBC has been disputed
6 with very specific facts. And what it comes down to, Judge,
9 evidence points that Hermitage and Mr. Browder did it. That is
17 of money is, as far as I can see, a part of the case, and you
19 Browder did it. That is the heart of the dispute. The "did
1 and I'm not going to answer the problem, but I see a problem,
3 case about the law firm and the lawyer indicating the evidence
5 the law firm arguing the case to the jury, and at the same time
6 there being evidence about that law firm that comes up in the
18 minute.
20 not.
5 he's being asked about what happened and he says, well, the
6 first time someone tried to frame me for this case, I went and
9 the government describes the harm that was done as part of the
14 how a bank was harmed in this case. The Hermitage had to spend
23 that the jury would not be asked to find the Hermitage engaged
4 that simple.
6 said a year ago. Because a year ago Baker & Hostetler tried to
7 say that they could defend this case without attacking their
14 difference between then and now, your Honor, is that now they
15 have turned on that client, their former client, and now they
17 decided -- and you drilled right down to it, your Honor. You
18 put your finger right on it. Baker & Hostetler said that
22 right. Before you get to the laundering of the money, you have
23 to get to the crime that generated the money, and their defense
24 now is, HSBC is not the victim of any crime because Hermitage,
6 actually the party responsible for this crime. And I think the
17 not saying Hermitage did exactly what their clients are accused
18 of, but they are saying that Hermitage's guilty conduct and
23 my mind.
1 And you were exactly right about that. And so defense counsel
9 and said, let's just all agree that the facts about the
10 original crime are not in dispute, that was the basis of their
16 say no? Again, your Honor, you put your finger on it. Because
21 guilty of a crime. Not just any crime. The crime that that
3 right now --
7 Hermitage did it. That's how they are defending against the
19 they never even got it. That's not how you earn $200,000 is by
22 when you go to work for them and you try to do your best to
23 help them. And here's the help that Hermitage needed in 2008.
24 They were being framed for this crime, and Baker & Hostetler,
4 being framed for this crime. The Russian authorities are still
15 generally.
21 (Recess)
4 to let us know when you want the brief, because there's a lot
5 of things here that have been exaggerated and the record's not
15 this.
2 cited caselaw, but I assume the points you want to make have
4 your points. Are there other points that you want to make? If
5 so, go ahead. But the thing is that we have a trial coming up,
16 that claim for failure to state a claim. And so the idea that
18 that's one point, that SUA may not go to the jury because we
19 have a motion pending. And the only SUA we say states a claim
20 would not relate to these facts. That's for bribery, it's not
22 THE COURT: Those are the points you want to add, and
17 That was the motive. Because this same issue has been in this
18 case since the beginning. And we have been saying things about
23 sentences?
8 prejudice anyone.
20 o0o
21
22
23
24
25
4 Plaintiff,
7 Defendants.
8 ------------------------------x
December 23, 2015
9 12:10 p.m.
10 Before:
12 District Judge
13 APPEARANCES
14 PREET BHARARA
United States Attorney for the
15 Southern District of New York
PAUL MONTELEONI
16 MARGARET GRAHAM
Assistant United States Attorneys
17
BAKER & HOSTETLER LLP
18 Attorneys for Defendants
MARK CYMROT
19 JOHN MOSCOW
NICK ROSE
20 -and-
NATALIA VESELNITSKAYA
21
SUSMAN GODFREY L.L.P.
22 Attorneys for Hermitage
JACOB W. BUCHDAHL
23
24
25
7 defendants.
10 guess it's Christmas Eve Eve. Anyway, there are some things
9 court pending the outcome of the appeal. Again, this was all
12 please.
19 will, but I don't know if you have some guidance on that point.
20 They weren't the movant. They aren't our client. Why do they
3 we don't object.
18 put in its discussion what it has put in, and I will certainly
19 consider this.
16 date in January.
2 difficult decision for me, and I think I said it, and I will
10 would welcome any further briefing that would assist the Court
22 any, you wish to submit, and when you wish to submit it, I will
25 about this.
10 brief the issue and for you to consider it, I wouldn't say from
20 Mr. Cymrot.
12 would like just a minute or two to address the Court about the
15 you?
18 v-e-s-e-l-n-i-t-s-k-a-y-a.
1 decision from December 18 was very aggravating for him, and the
2 owner of the companies who are subject to this case, Mr. Denis
9 who have been doing a good job on the case for two and a half
13 case as well.
19 is that correct?
3 this long distance, and although you spoke briefly, you made a
7 telephone conference?
11 (Adjourned)
12
13
14
15
16
17
18
19
20
21
22
23
24
25
10 Before:
12 District Judge
13 TELEPHONIC APPEARANCES
25
8 Anatoli Famory.
19 in-house counsel.
12 made was made without giving a fair and normal opportunity for
7 sufficient.
18 ahead
25 the action, has filed what I assume you believe is the brief
4 sure it will be read by the Court but it's got to be filed very
7 action.
10 (Adjourned)
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
4 v. 13 CV 6326 (TPG)
10 Before:
12 District Judge
13 APPEARANCES
14
PREET BHARARA
15 United States Attorney for the
Southern District of New York
16 PAUL MONTELEONI
MARGARET GRAHAM
17 Assistant United States Attorney
23
24
25
9 Phillips.
17 Natalia Veselnitskaya.
20 clerk.
22 for --
24 Mr. Buchdahl.
4 defendants.
15 much.
11 a claimant.
15 the companies that are -- the companies and properties that are
18 to me.
6 tell us what they told the court ex parte that caused this
9 court now.
12 that they've applied for visas and those were denied. We, the
22 did that so that Mr. Katsyv could testify. And we made the
8 now there -- the trial date isn't set yet. And there are
13 think that that's really the end of the matter and that further
20 Now --
1 it shows about the status of that and I'm not going to go into
8 parole.
23 million freezing order on the case and that calls for a prompt
5 repeatedly.
7 they have been here and been to some hearings they have a much
15 for more than two years and yet denied them the right to defend
17 they are in the United States and things are going to happen
18 over the next several weeks that they have to be here for, and
1 happen in the next few days that would not mean that there
7 period when they don't need to hire new counsel and they don't
16 can be done.
21 THE COURT: What did you just say? What did you just
22 say?
1 will promptly issue new parole so that they can come back and
7 for parole now. If there is, then we will issue that parole.
9 said this and I'll repeat it. I intend to decide the issue of
15 as soon as possible.
23 that?
15 14th.
18 don't have the final say but I will certainly pass the request
1 granted to the 14th and we all have some work to do. I think
6 (Adjourned)
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
4 Plaintiff,
5 v. 13 CV 6326 (TPG)
7 Defendants.
8 ------------------------------x
New York, N.Y.
9 January 12, 2016
1:05 p.m.
10
Before:
11
HON. THOMAS P. GRIESA,
12
District Judge
13
APPEARANCES
14
PREET BHARARA
15 United States Attorney for the
Southern District of New York
16 PAUL MONTELEONI
KRISTY PHILLIPS
17 JAIMME NAWADAY
Assistant United States Attorneys
18
BAKER & HOSTETLER LLP
19 Attorneys for Prevezon Defendants
BY: MARK CYMROT
20 JOHN W. MOSCOW
21
22
23
24
25
6 that. We'll start where we are right now; and that is,
7 preparing for the trial. The trial in this case will start
9 will take place that day; and the trial will move forward from
10 that point. The trial days will begin at 10:30 in the morning
11 and, with a lunch break, the trial days will last until 4:30 in
12 the afternoon.
18 case.
5 about the January 21st date, and with this short notice, it's
8 selection can begin the last week of January, but then, if the
22 extension.
4 February 1st but that the actual witness presentation and the
12 (Pause)
21 Is that right?
2 the way you had it set up. Well, you had it Thursday. We're
6 not one. And then February 1st is a Monday; that would be when
21 yes.
22 THE COURT: We heard from the jury room that they can
1 only lasts a day, so the jury will be selected on the 27th, and
19 weeks.
25 the seven weeks by taking four weeks for the government's case
1 and three weeks for the defense case, so that a juror needs to
10 the trial. So, we have to set a hearing date for the motions
13 date that covers the defense motion to dismiss and for the
14 motions in limine.
16 (Pause)
25 all.
3 Thank you.
11 afternoon?
14 care of it all.
5 yesterday.
3 you.
13 Honor.
6 summation.
9 today, though.
11 conference.
18 comprehensible to the jury and the Court. And both sides, I'm
20 that, but the party that bears the burden of proof should get
5 complicated trials. I've never seen that. They get the first
7 To give them the first word and the last word would be grossly
8 unfair.
10 MR. CYMROT: I'm saying that they get the first word
11 with the jury at the opening. That has a huge impact. They
13 the first word and the last word, that is clearly an unfair
20 charges that sound like they are crimes, they want to treat it
9 counsel seeks are, in this case, just simply improper and very,
18 Gleason in the Eastern District, every civil case was done this
1 bearing the burden of proof doesn't get a chance for the other
13 or summations?
22 defense. And the same issues that Mr. Monteleoni raises about
23 the last word, that the prosecution can say things that we
9 about is summations?
11 MR. CYMROT: I'm not sure why you need to decide this
12 now, your Honor. You can see how the trial goes and decide
17 myself.
25 cases have their usual practice that for summations the defense
1 goes first and the plaintiff goes second. Some judges have
3 first, the defendant goes second, and then the plaintiff gets a
5 case.
9 what I thought was the usual practice, and that is, to have the
13 giving one summation and we'll start with the government and
17 concern is what will assist the jury. And that's the way we'll
18 leave it.
20 (Adjourned)
21
22
23
24
25
11 Before:
13 District Judge
14
APPEARANCES
15
PREET BHARARA
16 United States Attorney for the
Southern District of New York
17 PAUL M. MONTELEONI
CRISTINE I. PHILLIPS
18 Assistant United States Attorneys
22
23
24
25
1 (Case called)
7 Mr. Monteleoni.
12 colleagues.
14 me from Judge Griesa for trial and all purposes at a time when
17 came down from the Second Circuit. And I see that, like this
22 Mr. Monteleoni.
6 The case has been pending for a long time but with
12 discussions.
14 2015. Before then there had been two partial depositions that
25 litigated for between six and seven months. During that time
8 us, though I'm sure courts in this district deal with somewhat
24 been done by this point. But they were going at a track along
2 discovery bled over into the expert discovery period and indeed
16 former client committed the fraud and thus they argued that it
1 THE COURT: Aside from that expert, what are the other
12 of a Daubert motion.
10 investigation?
19 at the time of the stay, but there were a few other areas that
2 those loose ends. But there were these loose ends with respect
3 to those depositions.
8 are part owners of the defendant companies and thus are covered
16 IKR and Martash Holdings, and they are both companies that are
22 not just because they are a part owner like IKR is, but also
10 They are not things that we were able to prioritize during the
13 that had been made just as the trial was approaching and all of
18 to trial.
23 complaint that sets forth that final theory. But one way or
2 that.
11 little more accurately, this case has been pending for far too
19 as possible.
22 pending in which they have put forth this new theory. That was
25 Our view is, it's far too late to amend the complaint
5 can do it, they can do it. But from our perspective, if they
9 It's true that the case has been stayed for a year.
15 largely where they were at the time this case was stayed.
16 THE COURT: Let me ask you this. When are you going
17 to be ready to go to trial?
3 All the motions were terminated when the case went up to the
5 any motions they want to make so that I've got a clear record
19 conference, and we told them we will look at them and get back
23 matter, the view that I think we are going to take is, to the
24 extent there was discovery that had been ordered by the Court
25 that hadn't been done, let's get that done. To the extent it
1 goes beyond that, we think it's too late. We think this case
13 that.
20 be some items that are easy enough to knock off that it doesn't
23 to talk to them further and see what precisely they want to do.
1 business has been essentially shut down for a year. They are
6 been drinking from the fire hose as fast as we can and are
14 THE COURT: And have the witnesses who the parties are
23 together.
1 report.
5 areas in which trial can be made much more orderly if they are
10 of legal rules that govern when the government can trace assets
20 put before the jury. That's one area that I think will impose
9 of that nature.
14 and then there are other sort of Daubert expert issues with
18 perhaps more than the usual case, would benefit from thoughtful
21 case?
11 orderly way.
15 four weeks for the government's case in chief. That was based
17 length of trial day and trial week and the like. I think that
19 conservative estimate.
22 trial, bring the jury out at 10:00 and to try the case until
2 given trial day so that we can take up any issues that they
3 want to raise with the Court outside of the hearing of the jury
12 call the same witness, if the government calls the witness, the
15 It's only after both sides have had a full and wide-open
20 same witnesses.
2 that ongoing that didn't make it in. And also some of the
9 you that we are still really getting our hands around what's
23 Honor.
14 motion that has not yet been filed, even in a now defunct form,
22 are still getting our hands around it, is that under applicable
23 law they simply can't trace the assets to our clients in a way
1 will clarify it and sort of invite some of the issues that the
7 but let me fix a schedule and fix a schedule with a trial date.
8 Why don't you file any motion addressed to the second amended
15 And what I'd like to do is see if we can't set this case down
16 for jury selection and trial beginning on May 15 with the hope
4 April 18, and I can set all of those motions down for an oral
24 submit any proposed voir dire that they think is unique to this
1 you plan to submit that by May 1 and then we can select a jury
6 May 9. I think that might be better. All the dust will have
7 cleared by then.
15 you're envisioning.
18 that then makes it clear to the parties what they may want to
20 that --
3 ends that we believe are there and we want to make sure that we
21 resolve it.
7 February. The Court and the parties will know after that time
15 defendants' consideration.
23 that.
25 accomplish today?
7 Peck?
18 matters?
25 o0o
5 v. 13 Civ. 6326(WHP)
7 Defendants.
8 ------------------------------x
14
APPEARANCES
15
16
17 PREET BHARARA
United States Attorney for the
18 Southern District of New York
CRISTINE I. PHILLIPS
19 PAUL M. MONTELEONI
Assistant United States Attorneys
20
24
25
1 (Case called)
9 Abensohn.
19 as they stand, and I will take them in the same order that the
24 Ms. Phillips?
10 Martash.
14 produced.
21 earlier?
8 that.
14 December trial date and then later the January trial date, we
17 bank records and e-mails that the corporate officers had sent
20 to.
1 length of time we have before trial and the fact that we have
9 Mr. Reed.
12 rules of discovery, and that's simply not right. They made the
23 2014?
16 simply picking up the phone and calling our client down the
17 street and ask him to go in his file cabinet. If that were the
21 entities overseas, with people who are not familiar with United
25 your Honor directs it, but it is not simply a matter of, you
14 and IKR documents, based on what this court's gleaned from the
21 statements."
7 document requests.
1 from.
3 agreement.
19 records.
3 first.
9 assistant?
15 issue of these MLATs that were responded to, did the government
17 was in place?
20 do that and how many MLATs did they issue that are involved in
21 the documents that are here that are the subject of this case,
25 and summer of 2016. That was during the pendency of the stay.
15 earlier MLATs that had been served in 2015, well before the
16 stay, but it took over a year to get them, because that's how
2 fact?
4 issues.
22 view was that the entire case had been stayed by an emergency
1 quite promptly upon the lifting of the stay, but we didn't view
8 received them?
15 the stay was lifted, which he did. The report that he formed
18 here.
20 you were before the stay was granted by the Second Circuit,
21 right?
1 takes a lot of time and it generates leads, and those leads can
14 analyzing the documents and assessing where the money went and
23 when we did.
1 2016?
3 the sine qua non of the case where their exclusion would render
15 with that.
6 expert from the initial report and the latest revised report?
17 Exhibit 2 to a jury?
22 done that are part of the report. That's just, they obviously
23 attached the most complex one to give the court a sense of the
2 but perhaps not. But certainly we are not going to ask the
8 THE COURT: I can tell you, you are not going to win
14 documents.
18 documents.
20 will point out that some of the expansion involves matters that
25 entities --
14 but let me just find out for one minute while we are on that
15 point.
16 Mr. Reed.
20 objection to that.
4 to the court.
6 report?
8 Thank you.
10 Mr. Reed.
15 like you have it and don't need it, but I can certainly put it
18 on 8 1/2 by 11.
21 day.
24 lawyers.
1 up.
8 covers not only these 43,000 new documents, but their expert
15 analysis. We now have the same task, only we also have the
21 clients here who have had their assets restrained for three
24 happen and why did this happen, what Mr. Monteleoni tells you
25 is, Well, after the stay was imposed, we continued our grand
1 jury investigation.
5 reply letter that they threw over the transom at 10:00 last
19 well, the jury needs to have the complete picture, and it would
23 find what the facts are; and when that time is over, you go to
24 trial. And if, three weeks later, you get new evidence or we
25 are in the trial or after the trial you get new evidence,
6 very much yes. Their theory has changed marginally, and I say
9 produced these --
11 marginally.
10 trial.
13 if there are similar bases upon which we can say that your
15 said, because that's all they have. They don't have any
17 this money was being laundered. They just know that we got it,
21 thoroughly.
24 be, well, let's push the trial off several months, because that
25 rewards them for basically not doing what they should have done
1 earlier.
4 this earlier? They filed a complaint, and they had their case
9 nobody ever went to Judge Griesa and said, your Honor, slow
18 the same.
24 Thanks.
7 next week.
9 handwriting expert.
20 would there have been a time when you would have learned of
4 counsel was formerly our counsel. And the response from the
9 that.
18 intended to defend this case, but they expressly said that that
19 was not what they intended to do; and if they weren't going to
23 was part of the argument that they put in their brief, which
24 was new to us for the first time, because they had taken the
16 made the same offer, that they can certainly depose Mr. Virgin,
2 suffice?
21 you.
5 that or would use that testimony. But the testimony was there
8 the deposition.
12 expert?
22 that.
24 Judge Griesa?
6 issue at the time Judge Griesa had the case. But the
16 point?
19 to rule.
22 treasury fraud.
11 The Yonkers City School District v. CNA Insurance Co., 113 F.3d
13 702.
23 11, 2007).
6 fact.
10 last year before Judge Griesa before the action was stayed.
12 request.
18 statement.
1 the stay.
4 which was conducted by the Latvian police under oath, that the
10 statement, not for the truth of the statement, but simply for
13 functioning entities.
17 chose to do so.
4 a legitimate purpose.
9 the idea that the only purpose of these companies was money
10 laundering.
15 trial?
17 impossible.
9 conference.
11 York.
13 spring, I believe.
24 Mr. Reed.
1 idea that just a witness statement could come in, because the
2 idea that it would not be admitted for the truth seems, to us,
18 So that brings us --
24 why that might be, but I can also speculate, you know -- within
6 taking several days out of our now less than three-month trial
10 the guy, we don't have the optics of looking at him and getting
13 that way.
17 government still has not offered any reason why they couldn't
23 briefly what I mentioned earlier, the mere fact that they have
5 Honor.
24 seeks to admit this statement not for the truth of the matter
25 of this case.
2 not even known to the government at the time the government was
5 for a deposition.
14 memorandum.
18 of Mr. Browder, and then I am going to give Kobre & Kim until
9 Honor.
16 objection.
5 they have presented these disputes to the court. You all have
7 letters and arguments were very clear and helpful to the court.
11 - - -
12
13
14
15
16
17
18
19
20
21
22
23
24
25
4 Plaintiff,
5 v. 13 CV 6326 (WHP)
7 Defendants.
8 ------------------------------x
New York, N.Y.
9 April 5, 2017
10:34 a.m.
10
Before:
11
HON. WILLIAM H. PAULEY III,
12
District Judge
13
APPEARANCES
14
JOON H. KIM,
15 Acting United States Attorney for the
Southern District of New York
16 BY: PAUL M. MONTELEONI
CRISTINE I. PHILLIPS
17 TARA M. LA MORTE
Assistant United States Attorneys
18
23
24
25
3 (Case called)
14 is --
25 wouldn't it?
3 point out that over the course of this case, individual SUAs
8 search for a viable SUA, that claim got dropped. They dropped
9 the mail fraud claim. They added a fraud against the bank
11 turning wheel.
15 high level because in all the briefing and all the citations
19 bank."
24 false tax claims with the Russian treasury and was paid money.
4 this corner and turn that fraud against the treasury into a
9 it something else?
12 we're happy to argue from the bank fraud statute because Shaw,
13 the Supreme Court case from last year, laid out what would be
1 the police came on site, they raided our offices, they took our
11 a few weeks ago. That entity may have been the victim of a
14 under any natural reading, that is simply not what that is.
17 to this point. Mr. Firestone, who was the head of the law firm
19 put him and his colleagues in a conference room, went off and
24 is.
1 that claim they brought three, four years ago with a theory
7 a foreign bank.
9 bank?
20 were never under the impression that these agents were there
24 was at issue in Shaw, and again, I've read the language from
3 HSBC entities that were a step or two steps removed. They were
11 in any event, there is zero evidence that they even knew HSBC
16 Honor.
4 extraterritorial transactions.
17 that can be reached as criminal, and the only people who are
19 and Asia, who acted with the purpose of moving money from a
24 they were -- that they had any intent that would constitute
12 purpose are the people who moved money from places like Estonia
25 onces they point to were not related to the four transfers they
13 straight line.
24 When you peel past that, what you can gather from the
2 man, Mr. Stepanov, and in the middle of that chain there are
7 genuine.
21 there's a language that says don't visit the sins of the father
5 case where the government has spent three years trading out and
8 are not a fraud against a foreign bank. They are stuck with a
16 So, first of all, the Court is exactly right, that the statute,
23 Suisse.
2 way was the pretenses that the officers seizing the materials
7 and would very likely have prevented this scheme from taking
8 place.
9 The pretenses that they went under were that they were
12 they wrote a letter saying that they believed that this was
13 related only to the one company, which was the stated target of
2 after it had figured out a little bit of what was going on,
4 anyone. That was just false and that was directed at the bank
5 and that was material. Whether the bank would have ultimately
18 presented at trial.
24 the focus of the statute. I think that the arguments that the
1 hold water.
17 But even if the intent requirement did apply here, the evidence
25 about the Licci case. There were two Licci cases decided by
2 they cite is from the 2013 Licci case. That talks about the
8 and there, the question is, does it touch and concern the U.S.?
10 focus, did they take place in the U.S.? That standard doesn't
17 those dollars are cleared and involving the U.S. I don't know
24 purposefully?
2 the sense that the defendants do. We think that one person has
8 the customers.
16 foreign corruption?
24 herself?
4 would involve the fact that two of the tax official's deputies,
22 own tax office is because once the companies were in the hands
3 of someone who you know will approve them. And the payment to
4 the ex-husband and the obvious facts that you're not going to
8 that I've just described about the tax official's role are
11 point that they have no evidence that the people who conducted
13 the time of that raid. Shaw says, deception, the person doing
20 believed it was not valid. Mr. Browder testified that he, too,
21 understood that it was not valid. And as far as the idea that
1 come on site and say, hey, we're authorized, would you give us
2 X? What the testimony by Mr. Firestone and Mr. Bradder was was
4 one of them, went off on their own and took what they wanted.
5 Again, we can be in the weeds and we can trade cases and record
7 on premises, beat people and take things, the people have not
12 the United States. Licci says the exact opposite. Licci says
14 the United States. That is the law of the Second Circuit and,
7 James Bond villain types in Europe who knew that their banks
9 about this too. Turner talks about banks doing this thousands
12 by a bank.
15 who did this had any understanding, much less purpose, that
4 at all.
6 government loses the in limine, how would you show that the
9 would disagree with this, they can't show the payment. If the
14 pejorative, but all of the other dust that went in the air
18 Facebook territory.
5 Mr. Reed.
7 tracing.
20 forfeiture.
14 crediting that those may have had some knowledge of the Russian
19 counting the three to the side on the left when I talk about
20 that.
15 all the government has in this case. The expert, Mr. Rollins,
20 time period.
2 launder money.
5 assumptions?
6 MR. REED: Sure. They can, but what has to come into
1 the drug transaction, was a friend of the guy doing the drug
6 we don't know the names of the people who run them, we don't
7 know what they do, we don't know what they thought. There's
11 can't have.
1 through that and say, if we have proof that you have bad money
5 that. Once we know that you put bad money into your pipeline,
19 A good example --
1 filed with respect to Rollins, your Honor. The reason for that
20 judgement.
24 because I know your Honor has been patient with us. If you
3 I'm sorry, come into StarMix. Are you following where I am?
19 become 225 aside. The other problem, and the one that really
21 the same period that the 225 million came out of StarMix, the
8 can simply assume that the proceeds were reflected in the $225
21 Mr. Monteleoni?
8 and, in fact, it's not the law. The law doesn't require the
2 these are accounts that were just opened. No money came in,
7 But they all come in on the same day to a bank account that's
10 was a pattern with StarMix and with the other companies on that
11 level.
17 exactly where the money came from but knowing that it involved
20 which allow -- which are highly powerful and are relevant here,
24 those, you can just use the Banco Cafetero tracing assumptions.
2 need to know who was intending to send the money where before
3 you can use the tracing assumption to figure out where the
4 money went. It doesn't make sense. If you have all the proof
5 that defense counsel said you needed to have, you wouldn't also
17 Bank, but into this other bank, Banco Cafetero. Banco Cafetero
19 banks, and the government used the tracing rules to follow the
23 person who was charged with being the drug dealer, but from the
6 conjunction.
8 not just like this one-step rule. You can use these
15 case.
18 Prevezon, and then you get the other -- funds for the other 1.1
12 ample basis to make the finding that, in fact, these were money
13 laundering.
20 that, well, this Regalado Cuellar case said you can't get from
5 inference.
1 that.
13 the transaction.
23 off the scent. And the Court said that doesn't prove the
24 statute because how you transport money doesn't prove why you
9 Mr. Monteleoni's other point was that you don't need to know
19 proceeds, and the only way they can prove that is if they can
20 trace the money through all these 27 companies, down to us, and
8 Anything further?
22 afternoon.
25 (Adjourned)
4 v. 13 CV 6326 (WHP)
6 Defendants. ARGUMENT
7 ------------------------------x
10
Before:
11
HON. WILLIAM H. PAULEY III,
12
District Judge
13
14 APPEARANCES
15
JOON H. KIM,
16 Acting United States Attorney for the
Southern District of New York
17 PAUL M. MONTELEONI
CRISTINE I. PHILLIPS
18 TARA M. LaMORTE
Assistant United States Attorneys
19
QUINN EMANUEL URQUHART & SULLIVAN
20 Attorneys for Defendants
BY: ADAM M. ABENSOHN
21 FAITH E. GAY
KEVIN S. REED
22 RENITA SHARMA
CORY STRUBLE
23 -AND-
NATALIA VESELNITSKAYA
24
25
1 (Case called)
4 given the fact that I have a jury trial that's ongoing at the
5 moment.
14 criminal cases.
18 16, and started the trial on Tuesday, May 16. The jury
25 get started.
7 motion papers.
11 process.
18 held that the government cannot use its grand jury powers for
24 effective rule change may or may not have been; but, at the end
3 rule, is there, that says the government may not use evidence
5 case?
7 Honor, and I'm quoting the government, that the government may
8 not use grand jury process for the sole or dominant purpose of
14 that they have used grand jury process for the specific purpose
3 all of them for reasons your Honor has already alluded to,
4 given our agenda, but there's a few I think worth pointing out.
13 not denying that they used grand jury process for purposes of
19 not have that prerogative; they had the option that we had or
20 any other civil litigant had, which was to use the standard
22 Court. They didn't do that. They took it into their own hands
23 and they used grand jury subpoenas to collect evidence for this
24 case.
1 government's brief.
6 grand jury subpoenas were issued in this case. That was Agent
13 were all in the room; we were here when we were arguing about
15 during the stay period in this case. And while the government
19 purpose, your Honor saw the tracing chart that the government's
20 expert in this case had developed around this new grand jury
10 subpoena under Rule 45, your Honor, all the rest collected by
21 of discovery."
4 language I've just read from Sells that it certainly has a lot
9 field.
14 Let me talk about how blatant the use of the MLATs were for
19 from the only MLAT that we've had access to, and that was the
25 Prevezon Holdings."
18 they did it: Because it's more convenient. That's what Sells
19 tells the government it can't do. It can't take the easy route
2 has, but --
13 subpoena; it's not something that can be objected to; it's just
18 requests. Some have been under treaties, some have been formal
4 defendants cited for, which is that the grand jury should not
2 have created.
25 certainly there are restrictions on when you can use the grand
1 jury process, there are restrictions on when you can use other
12 disqualification motion?
23 grand jury subpoenas. But the Court has already precluded all
6 Anything further?
14 investigative purposes.
12 shortly after the complaint was filed. I will add that to the
13 list of clear indicia that these criminal tools were being used
3 purposes for which the grand jury process has served and is
3 criminal case.
25 (S.D.N.Y. 2012).
13 various purposes for which the grand jury process has served
18 also denied.
23 standard that derives from the Court's special concern for the
1 F.R.D. at 68.
8 grand jury process from those associated with the MLAT process.
12 the DOJ issued MLAT requests on behalf of the SEC for the
14 misconduct. This does not mean that the MLAT process can be
18 They then detail how there was a worldwide outcry on the United
22 indictments.
3 this case?
9 treasury fraud. The fact that they were trying to cover up the
22 here?
2 Hermitage was involved in the fraud and that Mr. Magnitsky was
12 work, because the first line in that chain, that somehow the
19 evidence of the three steps down the line that there was a
12 died in jail. And they propose not to tell the jury why he
25 arresting Magnitsky?
11 on presumably.
24 arrest.
2 the tax fraud of the Hermitage fund, the purported tax fraud as
4 right alongside Mr. Magnitsky for the same offense; they were
6 the validity of those charges against him. And the fact that
9 in prosecuting him.
13 value.
19 at trial.
18 Mr. Gross's --
10 he'd be humiliated?
17 credibility?
5 conducted.
10 events that may have colored the investigation from the outset
19 is granted.
21 summaries.
23 laundering allegations.
5 of settlements.
8 be permitted to introduce.
17 902, 908:
19 banks as something that's wrong and you should not do. But
20 there's another --
23 going to be sitting in the jury box, are going to know that you
25 right?
6 allegations.
10 UBS to figure out the cleanliness and the source of money that
13 learned from the Israeli settlement that banks rely upon the
24 issue here.
5 unfairly prejudicial.
8 a closer case for the Court than some of the other motions.
15 runs the risk of distracting and confusing the jury under Rule
16 403.
7 (S.D.N.Y. 2014).
11 the settlement under 404, that it would show that Mr. Katsyv
18 unduly prejudice and confuse the jury; it will only waste time
22 a money launderer.
10 average juror.
12 vouching --
16 with?
20 calls reiderstvo.
3 prosecution.
14 took the lawyers working for the government in this case some
15 time to wrap our heads around it. The fact that you can steal
20 concept.
22 be quite limited. I'll just note, your Honor, that Dr. Shelley
14 489 F.3d 115, 121 (2d Cir. 2007). "So long as it provides
16 United States v. Mejia, 543 F.3d 179, 191 (2d Cir. 2008).
12 actions Prevezon may make to the contrary. But Dr. Shelley may
14 that.
15 that's the first slide, your Honor, that you have before you.
24 with.
6 on, this comes very becomes very clear. That's the third slide
12 Russian criminal case file, including pages like the one your
14 the translation.
17 and I'm reading from their brief, will easily permit a jury to
16 among other reasons, your Honor, because -- and this also goes
3 tracing report is all the more reason that this can't be relied
4 upon.
25 the government can only hope to prove its case with evidence
18 sector."
25 authentic?
16 not apply.
6 difficult to comply with the rules, don't mean you bend the
9 perjury.
11 cite in our brief. The government says courts let this in all
16 dealing with.
5 each other. They corroborate with records that are from other
16 hearsay exception.
4 than those.
6 for the statement and got it, and said, This is what I got.
9 out.
19 are reliable than if there had been one piece of paper with a
21 sense.
25 think that there's any motivation for them to say that bank
1 statements don't say what they say or that they are false. In
9 that got out a day or two before that freeze came in. That
10 investigation that they did into the bank was not started about
14 do.
25 two accounts, the ones that actually were exit points from the
1 country.
23 bank records are applied all the time without any indicia that
4 but the grounds for putting that in, for having that
9 then the Court isn't going to find that those weren't. So that
21 getting over."
24 the Court with all the documents. That's because there's tons
11 hearsay."
14 records exception.
18 residual.
25 attorney:
3 statement that you received from your bank concerning your bank
4 account?
8 "A. Yes.
11 "A. Yes."
22 of the accounts.
1 that the court in Turner ticked off, as well as the fact that
17 records.
20 Honor, then these rules don't apply. And, again, I'll agree
23 Honor.
9 and I'm going to get that out next week. But, as you can see,
21 straightforward.
3 Russian transactions.
15 saying they have red flags for -- Belston, I'm sorry, and
19 goose/gander rule.
7 experience.
17 in part.
3 (Recess)
7 don't want to say this with regard to the wrong motion. But
14 in absentia conviction.
2 bias, for example, they can do that. But what they can't do is
4 of the judgment. So, for example, they can't use it for the
20 people who would have said that the prosecution against our
5 yes.
13 less reliable, for them to make that argument to the jury, they
14 don't have a case that tells you that under this rule we are
15 not permitted to use it. What they have is a case that says
23 the burden. I'm not going to stand here, given our other
11 prudence."
21 Browder's testimony.
5 absentia conviction not for its validity, but for these other
11 pre-discovery evidence.
15 put the government on trial by making the case not about who
16 did what in Russia or who did what when the funds came to them
17 and in New York, but who did what in the U.S. Attorney's
18 Office.
6 of any defense.
9 precluded.
12 they would confuse the jury. Any factual changes, the small
17 what the government knew earlier and when did they know it is
19 precluded.
5 current, what the government basically says is, Well, that was
8 in play.
19 happened here.
21 cases that he says he had no notice of; among other things, his
24 things, he had the tax fraud, which the agent blithely said he
4 followed.
8 and get them. Well, that's still live. If your Honor were to
11 a crack at the case agent for having more or less said that
19 government's motion.
9 narrative with proof of its own to show the jury that it's
19 ground.
6 just want to think a little bit more about what's been said.
11 something I've told you previously, we will try the case from
14 try the case four days a week, unless I find that we're really
15 lagging, and then we may try the case at least for half a day
16 on Friday.
18 get real close to the trial date, as to what you think you
2 Court's indulgence.
13 conference.
1 That's it.
12 arrangements.
16 somewhat short notice. We were also told that they would not
19 the case, I'm not going to leave my mother on the off chance
20 that I come here and I get arrested and she's stuck in Russia
23 help. I don't know that the Court has the authority or the
6 it. Without him here, I think our backup would be having him
10 just don't think the jury would get the full benefit of the
17 least guidance to try and basically work this out so we can get
5 extraordinary circumstances.
4 that a witness asked for this type of thing because they are
7 which don't have to do with what our plans are or aren't with
15 explained.
19 assessment of credibility.
21 that he's here. I'm not going to tread on the authority of the
24 here.
7 not witnesses.
8 Anything else?
11 pretrial order?
13 best to just submit a new order so that it's all in one place.
18 MR. REED: No, your Honor. Thank you for your time.
22 * * *
23
24
25
4 Plaintiff,
7 Defendants.
8 ------------------------------x
New York, N.Y.
9 May 11, 2017
2:35 p.m.
10
Before:
11
HON. WILLIAM H. PAULEY III,
12
District Judge
13
APPEARANCES
14
JOON H. KIM
15 Acting United States Attorney for the
Southern District of New York
16 PAUL MONTELEONI
CRISTINE PHILLIPS
17 TARA LA MORTE
Assistant United States Attorneys
18
QUINN EMANUEL URQUHART & SULLIVAN
19 Attorneys for Defendants
BY: KEVIN S. REED
20 FAITH E. GAY
ADAM M. ABENSOHN
21 RENITA SHARMA
CORY STRUBLE
22
23
24
25
1 (Case called)
8 Faith Gay Adam Abensohn, Renita Sharma, and our client, Dennis
9 Katsyv.
14 Mr. Reed.
16 courts across the country and here in the Second Circuit have
10 expertise will provide to the jury outweighs the risk that such
24 determining the issue of fact and here, from what I read in all
1 deal to the jury about what they should look for in comparing
3 jury.
19 limine.
3 you are making that determination, here are things that you
4 should consider?
2 May 16. There are still too many trials, criminal trials, set
3 for Monday. If one of them falls off, and it might in the next
8 briefly?
25 the end of the trial we have nine jurors who are deliberating,
2 But if we have lost folks along the way, so long as we have six
6 another suggestion?
8 Honor.
14 the case being this long, with it gaining publicity, with the
16 last week or so, we would like to maybe start off with 12 and
18 try to do that.
24 ample.
6 very much like to advocate, if you have a four week trial plus
7 us, a week, week and a half, that we start with 12 and fall to
8 eight.
22 box?
4 qualified to serve and that any challenges for cause have been
7 that brings someone out of the venire that is scarier than the
11 were speaking.
15 select juries. And myself as a lawyer and the judges who did
22 caution.
25 summary of the case was too long for the Court to get involved
8 LLC; Prevezon Pine USA, LLC; Prevezon 1711 USA, LLC; Prevezon
9 1810, LLC; Prevezon 2009 USA, LLC; Prevezon 2011 USA, LLC,
20 the government.
12 in this case nor have they been charged with any crimes. The
24 public official. Not that the jury necessarily has to hear all
1 part and think that that's all it was, so I would request some
18 clear that we are not involved in the Russian crimes, which the
12 there anyone who believes they couldn't keep what they have
13 read, seen, or heard about Russia separate from what they will
15 that what they have heard about Russia will interfere with
17 the Magnitsky law here. I hesitate and have not asked and I
18 see that you didn't propose that I ask whether any juror has
22 MS. GAY: Yes, your Honor. Our view is, they will
1 asked.
15 brought up.
21 MS. GAY: Your Honor, if you are not going to use the
4 defendants' request --
8 to proceed?
14 get a yes answer, I am not going to hear the reason for the
18 how many people are going to come up to the side bar for those
23 pose some further question based upon what you are hearing,
3 the side bar on some other issue, feel free to raise it and
5 rid of that juror early and put someone else in the seat.
8 pet peeves. If you have an objection, please stand and say you
14 created.
21 the trial.
16 But I'm really not sure how that's going to work. Let
21 posed for five lines were asked and answered. Not a very
3 my time.
14 I'll just give you one more. And the one more is the
23 pretrial order to find out what Exhibit 4 is, and it's merely
6 going to cut into your trial time. It's not going to extend
10 we can start to tee them up. And then you should pack a lunch
8 that reflect the order for each witness that we will be playing
11 intensive.
14 to you?
19 playing early in the first week we will get you our orders
20 tomorrow.
22 we can begin our jury selection and trial on Monday because the
23 impression.
5 moment from both sides about it. I'm not sure that I can rule
6 on it right now.
7 Mr. Abensohn.
10 now.
19 those materials the indicia the Court relied upon in its order
25 It goes beyond the parameters that the Court set with the use
7 the letter came in. I was expecting to and I would request the
10 abroad. And the first set is just a few other documents that
5 talk to their banks and what they get. We can only ask. And
10 us.
14 instances.
17 not. And we obtained some of their records from the Swiss bank
9 oversight.
1 farfetched than the ones they presented to your Honor. And now
5 Court.
14 once and then at another time that same paralegal could take
2 require clarification.
7 the jury.
20 Monday.
23 of that.
21 court-certified interpreter.
4 team --
7 Office with a cooperator who they spent weeks across the street
17 objection.
4 those who are following the case. And I'll wish you all a good
11 started, that would be just fine, but I'm not going to press
12 you on that.
14 it.
8 who are coming up. You really should be thinking about what
9 the batting order is for next week so that defense counsel can
17 that.
12 whether that's the beginning of the trial day, the end of the
15 the trial day. You can send letters at any time. I may be
16 asleep, but others are watching. And then I can hear all about
20 surprises. So do I.
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