United States v. Ginsberg

UNITED STATES OF AMERICA v. SCOTT GINSBERG, Defendant.

No. 14 CR 462

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION

November 2, 2018

Judge Sara L. Ellis

OPINION AND ORDER

In August 2014, the government indicted Defendant Scott Ginsberg for financial institution fraud, in violation of 18 U.S.C. § 1344, and making false statements to a bank, in violation of 18 U.S.C. § 1014, in connection with a scheme to obtain mortgage loans to finance the purchase of condominium units at the Springhill Development in Roselle, Illinois. Mr. Ginsberg's first trial, in October 2016, resulted in a mistrial. Mr. Ginsberg did not testify at the first trial. The government then filed a superseding indictment in March 2017, proceeding on twelve counts of financial institution fraud in connection with the purchases of condominiums in the Springhill Development by Gregory Callahan, Judith Ellis, and Martin Swidler. The second trial occurred in March 2018, with the jury finding Mr. Ginsberg guilty on all twelve counts. Mr. Ginsberg again did not testify at the second trial.

After trial, Mr. Ginsberg retained new counsel and filed a motion for new trial, arguing that his trial counsel provided ineffective assistance of counsel and that the Court made evidentiary errors in admitting certain testimony. The Court held an evidentiary hearing on the ineffective assistance claims on October 29, 2018. The Court now denies Mr. Ginsberg's motion for new trial, finding that Mr. Ginsberg did not receive ineffective assistance of counsel and that the Court properly admitted the challenged evidence.

LEGAL STANDARD

Federal Rule of Criminal Procedure 33 allows "a district court to grant a timely request for a new trial 'if the interest of justice so requires.'" United States v. O'Malley, 833 F.3d 810, 811 (7th Cir. 2016) (quoting Fed. R. Crim. P. 33(a)). A new trial is warranted where "the substantial rights of the defendant have been jeopardized by errors or omissions during trial." United States v. Kuzniar, 881 F.2d 466, 470 (7th Cir. 1989); see also United States v. Van Eyl, 468 F.3d 428, 436 (7th Cir. 2006) ("A defendant is entitled to a new trial if there is a reasonable possibility that a trial error had a prejudicial effect upon the jury's verdict."). "[T]he exercise of power conferred by Rule 33 is reserved for only the most 'extreme cases.'" United States v. Linwood, 142 F.3d 418, 422 (7th Cir. 1998) (quoting United States v. Morales, 902 F.2d 604, 605 (7th Cir. 1990)).

ANALYSIS

I. Ineffective Assistance of Counsel

A defendant may seek a new trial based on ineffective assistance of counsel. United States v. Taglia, 922 F.2d 413, 417 (7th Cir. 1991). To establish constitutionally ineffective assistance of counsel, Mr. Ginsberg must show (1) "that counsel's representation fell below an objective standard of reasonableness," and (2) "that there is a reasonable probability that, but for counsel's unprofessional errors, the result of the proceeding would have been different." Strickland v. Washington, 466 U.S. 668, 688, 694, 104 S. Ct. 2052, 80 L. Ed. 2d 674 (1984). In considering the first prong, the Court indulges "a strong presumption that counsel's conduct falls within the wide range of reasonable professional assistance" and may not let hindsight interfere with its review of counsel's decisions. Id. at 689. For the second prong, a "reasonable probability" is "a probability sufficient to undermine confidence in the outcome." Id. at 694.This means a "substantial," not just "conceivable," likelihood of a different outcome in the case. Cullen v. Pinholster, 563 U.S. 170, 189, 131 S. Ct. 1388, 179 L. Ed. 2d 557 (2011) (quoting Harrington v. Richter, 562 U.S. 86, 112, 131 S. Ct. 770, 178 L. Ed. 2d 624 (2011)). The Court need not address both prongs of the Strickland test if one provides the answer; that is, if the Court determines that the alleged deficiency did not prejudice Mr. Ginsberg, it need not consider the first prong. Ruhl v. Hardy, 743 F.3d 1083, 1092 (7th Cir. 2014).

Mr. Ginsberg raises two grounds for his ineffective assistance claim: (1) that his counsel, Jack Rimland, provided him with erroneous advice concerning his right to testify in his own defense, and (2) that Mr. Rimland failed to investigate potential defense witnesses. "Typically, an ineffective assistance claim raised in a motion for new trial is addressed by holding an evidentiary hearing for the trial court to consider the evidence of the trial counsel's deficiency and its possible effect on the outcome." United States v. Malone, 484 F.3d 916, 919 (7th Cir. 2007). The Court held a hearing and has considered the testimony of both Mr. Rimland and Mr. Ginsberg at that hearing, along with the additional material submitted by Mr. Ginsberg and the government, in addressing Mr. Ginsberg's two claimed grounds for ineffective assistance below.

A. Mr. Ginsberg's Decision Not to Testify

A defendant has the fundamental right to testify in his own defense. See Sarfraz v. Smith, 885 F.3d 1029, 1037 (7th Cir. 2018) (right to testify in own defense provided by the Fourteenth Amendment's due process clause and the Sixth Amendment's compulsory process clause). "[O]nly the defendant himself, not his lawyer, can waive the right to testify." Barrow v. Uchtman, 398 F.3d 597, 608 (7th Cir. 2005). A defendant must waive his right to testify voluntarily, knowingly, and intelligently. Starkweather v. Smith, 574 F.3d 399, 403 (7th Cir. 2009).

Here, Mr. Ginsberg argues that he decided not to testify at his second trial based on Mr. Rimland telling him, shortly before needing to make the final decision about testifying, that testifying would harm Mr. Ginsberg's defense because the government would cross-examine Mr. Ginsberg on "every real estate deal [he] had made in the past 20 years and would make [him] look very dirty to the jury." Doc. 115-1 ¶ 9. According to Mr. Ginsberg, this last-minute information caused him to rethink his decision to testify and to ultimately exercise his right to remain silent. Mr. Ginsberg now argues that Mr. Rimland incorrectly stated that the government may be able to pursue this line of questioning based on the Court's ruling on his motion in limine concerning prior transactions and the government's representations at the first pretrial conference that it did not intend to argue that the jury should consider non-Springhill transactions in determining guilt. Mr. Ginsberg claims that, based on this allegedly incorrect advice, he did not make a fully informed decision as to whether to testify. See Starkweather, 574 F.3d at 403 ("[A] number of cases have held that incorrect advice that induces a defendant to waive his right to testify can constitute ineffective assistance." (collecting cases)).

But Mr. Ginsberg cannot establish that Mr. Rimland provided him with incorrect advice about the government's ability to cross-examine him on his prior real estate history. Mr. Ginsberg bases his claim on too broad of an interpretation of the discussion regarding and the ruling on his motion in limine related to prior transactions. That motion in limine purportedly sought to prohibit the government from introducing testimony, evidence, or argument related to any real estate transactions between Mr. Ginsberg and any witness, aside from those involving the Springhill Development. See Doc. 33. But the motion only referenced the potential testimony of Ms. Ellis and Mr. Swidler, id. at 2-3, with the government's response similarly focused only on these two individuals, Doc. 35 (stating that Mr. Ginsberg "seeks to bar thegovernment from eliciting testimony from two witnesses regarding their participation in certain real estate transactions with defendant pursuant to Federal Rule of Evidence 404(b)"). In addressing the motion at the first pretrial conference, the parties and the Court proceeded based on the understanding that it covered only the government's case-in-chief. The government disavowed any propensity argument, stating during the pretrial conference that "[i]t's certainly not our intent to argue that he's done it before so, therefore, he did it in this case." See Pretrial Conf. Tr. 16-17. The government agreed that Ms. Ellis and Mr. Swidler would speak only about the Springhill Development transactions, with them refraining from addressing prior transactions as the reason for buying Springhill Development properties. Id. at 18-19. The Court did not address the government's ability to confront Mr. Ginsberg with his prior real estate transactions if he decided to testify, an issue not explicitly raised in Mr. Ginsberg's motion in limine or brought up by either side at the pretrial conference.

Mr. Ginsberg chose not to testify at the first trial, but he claims that after it ended in a mistrial, he realized he needed to testify at the second trial to better make his case to the jury. He acknowledges that Mr. Rimland informed him of the Court's ruling on the motion in limine, and that he discussed his testimony with Mr. Rimland prior to the second trial, including potential areas of cross-examination. On the last day of the second trial, the Court took a lunch break before Mr. Ginsberg's planned testimony. During that lunch break, Mr. Rimland recounts that the government approached him and told him that, were Mr. Ginsberg to testify, the government would inquire about his prior real estate transactions on cross-examination. Mr. Rimland then informed Mr. Ginsberg of the government's intention to raise these questions. Mr. Ginsberg testified that he told Mr. Rimland he had no worries about such questioning for two reasons: (1) he did not have anything to hide because all his prior transactions were legitimate, and (2) hebelieved that the government could not bring up his prior real estate transactions because the Court had previously excluded them from the trial. But because Mr. Rimland told him that such questions were fair game and the inquiry could harm his...