Opinion ID: 793659
Heading Depth: 6
Heading Rank: 2

Heading: Corrupt Intent

Text: 70 There was also sufficient evidence from which the jury could conclude beyond a reasonable doubt that when he sent his Endorsement Email, Quattrone acted with corrupt intent, i.e. the wrongful or immoral intent to obstruct the grand jury's administration of justice. See id. at 599, 115 S.Ct. 2357. Quattrone contends the evidence failed to establish an improper motive. He asserts that the Endorsement Email was innocent on its face and that the circumstances that the government relied on to establish his intent are merely equivocal facts as consistent with innocence as with guilt. E.g., Reply Br. 16-17. The government responds that the circumstances surrounding the Endorsement Email established that Quattrone sent the email with the wrongful intent to obstruct, that Quattrone's innocent explanation for sending the email was rejected by the jury, and that Quattrone's subsequent false statement to Lynch supports the inference that Quattrone corruptly intended to obstruct when he sent that email. Appellee Br. 42-45. 71 The events leading to the Endorsement Email coupled with Quattrone's false statement to Lynch provided sufficient evidence to sustain the jury verdict. Quattrone's awareness of the subpoena's reach to Tech Group documents and the rapid escalation of the investigation between the time that Quattrone began drafting and sent the Endorsement Email, coupled with the subsequent false statement to Lynch, created a realm of permissible inferences; among them, it would be reasonable for a jury to conclude that Quattrone acted with the improper intent to obstruct the grand jury investigation. 72 As we have just noted, on December 3, 2000, Brodsky informed Quattrone, in no uncertain terms, of the potential threat of the grand jury investigation into the IPO allocation process as an extension of the NASD and SEC investigations. See J.A. 721-23 (Gov.Exs.603-05). Brodsky noted that there was a danger of a leak of the investigation, which would be extremely detrimental. J.A. 730 (Gov.Ex. 605). Brodsky wrote [t]his is serious and unless I can slow it down and curtail what they do, it will spread to others in the firm. Gov. Ex. 609. The jury could have reasonably concluded that Brodsky's December 3 emails alarmed Quattrone. From this evidence, the jury could conclude that Quattrone had a motive to prevent any detriment to the bank in order to protect his status and his income. 73 Evidence also established Quattrone's opportunity to obstruct and acts aimed at that end. On December 4, 2000, Quattrone received the Char Email, began to respond, but then stopped. J.A. 734 (Gov. Ex. 615B). The next day, before sending his Endorsement Email, Quattrone learned from Brodsky about the potentially damning leak of the investigations and the ominous threat that Quattrone might now be a target. See J.A. 273. Quattrone then sent his Endorsement Email that evening, promoting the Char Email while employing an exculpatory reason for endorsing the destruction of subpoenaed documents. J.A. 796. The proximity in time between additional negative information from Brodsky and the Endorsement Email, along with Quattrone's awareness that the subpoena called for documents Quattrone knew to be in possession of the Tech Group bankers, provided legally sufficient evidence from which a jury could conclude that Quattrone acted with corrupt intent to obstruct by seeking the destruction of relevant documents. 74 In addition, the subsequent false statement to Lynch provided additional circumstantial evidence of Quattrone's guilt. Although the evidence of the misstatement might lead to alternative inferences of either deceit or innocent mistake, the jury was in the unique position to observe Quattrone's testimony and to weigh the corroborating evidence of Quattrone's corrupt intent. The jury could reasonably rely in part on the misstatement to conclude that Quattrone acted with the intent to obstruct. 75 2. Sufficiency of the Evidence Relating to the Section 1505 Charge for Obstructing Proceedings Before Agencies of the United States 76 (a) Legal Elements 77 To prove obstruction of an agency proceeding, the government must establish that (1) there was a proceeding pending before a department or agency of the United States; (2) the defendant knew of or [believed] . . . that the proceeding was pending; and (3) the defendant corruptly endeavored to influence, obstruct, or impede the due and proper administration of the law under which the proceeding was pending. United States v. Sprecher, 783 F.Supp. 133, 163 (S.D.N.Y.1992) (citing SAND, ET AL., 1A MODERN FEDERAL JURY INSTRUCTIONS: CRIMINAL ¶ 46.02 (instruction 46-9)). The latter element requires a wrongful intent or improper motive to interfere with an agency proceeding, including the judicially grafted nexus requirement. Cf. Aguilar, 515 U.S. at 599, 115 S.Ct. 2357. 78 (b) The Evidence was Sufficient to Support Conviction for Violation of Section 1505 79 The evidence clearly established a connection between Quattrone's acts of obstruction and the SEC proceeding as well as his corrupt intent. 21 As noted above, the grand jury investigation and the SEC inquiry were for the most part simultaneous. Evidence of one was often interwoven with evidence of the other. Thus, just as the evidence of obstruction of justice was legally sufficient to support a conviction, that evidence was equally sufficient to show that Quattrone acted with the wrongful intent to obstruct the SEC's investigation by calling for the destruction of documents known to have been within the scope of its investigation of IPO allocation practices. 80 We think it clear that there was sufficient evidence from which the jury could conclude that Tech Group bankers would possess some documents sought by the SEC related to IPO allocations. While the question of the degree to which the Tech Group generally, and Quattrone specifically, became involved in making IPO allocations was disputed, evidence at trial indicated that Quattrone was involved in IPO allocation decisions. See, e.g., J.A. 444 (Tr. 1977). 81 The jury could fairly conclude that Quattrone was aware that the investigation into the allocation process reached the conduct of the Tech Group. When Quattrone received emails from LCD regarding Tech Group IPOs for which document-retention notices had been issued — Selectica, Inc. and VA Linux — the emails made clear that LCD was contacting Quattrone in connection with the SEC investigation into IPO allocations to determine his involvement with allocations, valuation, or pricing of the issues. J.A. 685 (Gov.Ex. 504); see also J.A. 686-92 (Gov.Exs.505-11). Furthermore, when Brodsky contacted Quattrone regarding the grand jury investigation, he made it clear that that inquiry was an outgrowth of the SEC and NASD investigations into our allocation processes in the IPO market. See J.A. 721-23 (Gov. Exs.603-05). In addition, after Quattrone learned from the head of LCD that the investigation into IPO allocations by the SEC had been referred to the Division of Enforcement, Quattrone asked Brodsky if he could forward the email to the head of the Tech PCS group. See J.A. 649 (Gov. Ex. 401). Given this evidence, the jury was free to reject to Quattrone's explanation that he thought the investigation focused on a separate business area of the bank. 82 3. Sufficiency of the Section 1512(b)(2) Conviction for Witness Tampering 83 In order to prove a violation of 18 U.S.C. § 1512(b)(2)(A-B), charged in Count 3, the government must establish that the defendant knowingly . . . corruptly persuade[d] or attempt[ed] to persuade another with the intent to cause that person to withhold records or testimony from an official proceeding or to alter, destroy, mutilate, or conceal an object with intent to impair the object's integrity or availability for use in an official proceeding. Contrary to earlier circuit precedent, see, e.g., United States v. Gabriel, 125 F.3d 89, 102-05 (2d Cir.1997), the Supreme Court's recent decision in Arthur Andersen makes clear that Aguilar 's nexus requirement applies to some degree to section 1512(b), 125 S.Ct. at 2136-2137. 22 Accordingly, we assume for the purposes of this case only that the evidence that was sufficient to establish the nexus element for the section 1503 charge applies with equal force to establishing that element of the witness tampering charge alleged in Count 3. See supra note 18. We do note, however, that section 1512(b) requires proof of a mental state that is knowingly . . . corrupt[] with respect to the action taken. See Arthur Andersen, 125 S.Ct. at 2135-36. The Supreme Court has made clear that the conduct to be punished, then, must not only be made with wrongful intent but also with a conscious[ness] that the conduct in question is wrongful. See id. at 2136. 84 The practical effect the conscious-wrongdoing standard of section 1512(b) has upon the construction of the nexus requirement as a result of Arthur Andersen is not before us. Quattrone does not argue that the distinction makes a difference. Instead he relies on the same set of arguments raised with respect to the section 1503 and 1505 claims — that he did not act with corrupt intent. Appellant Br. 34-35. Accordingly, we rest our analysis of Quattrone's corrupt intent on that set forth in the discussion of the evidence underlying the section 1503 and 1505 convictions. The evidence with regard to Count 3 was clearly sufficient. 85