Court Opinion

ID: 205186
Source: CourtListenerOpinion
Date Created: 2011-02-19 01:12:04+00
Date Added: 2024-06-11T17:27:47.036323
License: Public Domain

[DO NOT PUBLISH]

                   IN THE UNITED STATES COURT OF APPEALS

                              FOR THE ELEVENTH CIRCUIT
                                                                                  FILED
                                                                         U.S. COURT OF APPEALS
                                                                           ELEVENTH CIRCUIT
                                                                               FEB 18, 2011
                                           No. 08-17058                         JOHN LEY
                                                                                  CLERK

                              D.C. Docket No. 04-20250-CR-AJ

UNITED STATES OF AMERICA,

                                                                               Plaintiff - Appellee,

                                                versus

NICHOLAS BACHYNSKY,
a.k.a. Reporter Doe,
a.k.a. Nick,

                                                                           Defendant - Appellant.

                       Appeal from the United States District Court
                           for the Southern District of Florida

                                       (February 18, 2011)

Before EDMONDSON, PRYOR and BARKSDALE,* Circuit Judges.

PER CURIAM:

        *
         Honorable Rhesa Hawkins Barksdale, United States Circuit Judge for the Fifth Circuit, sitting by
designation.
      Nicholas Bachynsky appeals his convictions for: conspiracy to commit

securities fraud; and securities and wire fraud. He claims: insufficient evidence for

the conspiracy conviction; evidentiary errors, including disclosure of his prior

criminal convictions; and error in refusing his proposed jury instructions.

AFFIRMED.

                                         I.

      Following convictions in 1989 for racketeering and defrauding the IRS,

Bachynsky lost his medical license in Florida, New York, and Texas. This appeal

concerns his involvement in a subsequent fraudulent business scheme.

      In 2001, Bachynsky arranged with Richard Anders to establish Helvetia

Pharmaceuticals, which was purportedly intended to study, develop, and obtain

government approval for an experimental treatment called intracellular hyperthermia

(ICHT). The company’s ICHT therapy and its founders had a very suspect history:

ICHT used the drug 2-4 dinitropehanal (DNP), a toxic substance banned for medical

use by the FDA; Anders had felony convictions and was permanently barred by the

Securities and Exchange Commission from trading securities or raising investment

capital; and, as noted, Bachynsky, in addition to having lost his medical license in

                                         2
three States, had convictions in 1989 for racketeering and conspiracy to defraud the

IRS, for which he was imprisoned.

      Before starting Helvetia, Bachynsky had experimented with DNP for the better

part of his medical career. His experiments showed DNP not to be a successful

treatment drug: in all of his research, only two patients’ lives were prolonged and no

one was cured. Worse, four patients died during his DNP research in Mexico during

the late 1990s.

      Nevertheless, in approximately 2000, Anders and Bachynsky began business

planning using ICHT technology for cancer treatments, even though neither owned

the rights to the patent application. To further this plan, Bachynsky and Anders

enlisted Mahaffey, experienced in business-plan drafting, to develop a plan for a

company that would market ICHT therapy. Mahaffey warned Bachynsky: because

of his criminal history, he could launch, but could not manage, the company.

      Operating under the name Helvetia, Bachynsky and Anders distributed versions

of the business plan to potential investors, even though it contained false and

misleading information and material omissions: among other things, Bachynsky

represented falsely that Helvetia owned the exclusive rights to ICHT; he also did not

disclose his 1989 convictions and loss of medical license.

                                          3
      In 2001, Bachynsky and Anders set up corporate operations for Helvetia in

Florida. There, they conferred with Friedman, an attorney who expressed concerns

about their prior convictions. He informed them: they could not serve as corporate

officers, directors, or control persons; they could own no more than five percent of

the outstanding shares of stock; and they could not involve themselves in raising

capital for the company.

      Anders and Bachynsky had Helvetia incorporated in 2001 as a Delaware

corporation, authorized to do business in Florida. Later that year, Bachynsky left for

Europe to operate Helvetia’s clinics. There, he formed two Swiss companies to

support Helvetia’s operations. Bachynsky also made return trips to Florida to solicit,

and receive payments from, investors. Bachynsky played an important role in this

respect, because Anders would call upon him to provide technical information to

potential investors and instill investor confidence through his status as a physician.

During these solicitations, Bachynsky knowingly distributed fraudulent business

plans to investors, and provided fraudulent information about both the results of his

experimental studies with ICHT in Mexico and the status of his medical license.

      In 2002, federal investigators received information from Helvetia investors

regarding misrepresentations about its operations. Bachynsky, Anders, Laurence

Dean, and Arthur Scheinert were indicted in 2004. Dean and Scheinert pleaded guilty

                                          4
that September to: one count of conspiracy to commit securities fraud, in violation

of 18 U.S.C. § 371; and one count of mail fraud, in violation of 18 U.S.C. § 1341.

Following a third superseding indictment in 2007 against Anders and Bachynsky,

Anders pleaded guilty in January 2008 to one count of securities fraud, in violation

of 15 U.S.C. §§ 78(b), 78ff(a), and 18 U.S.C. § 2.

      Pursuant to that indictment, Bachynsky was charged with: one count of

conspiracy to commit securities fraud, in violation of 18 U.S.C. § 371; seven counts

of mail fraud, in violation of 18 U.S.C. §§ 1341, 2; five counts of wire fraud, in

violation of 18 U.S.C. §§ 1343, 2; 13 counts of securities fraud, in violation of 15

U.S.C. §§ 78j(b), 78ff(a), and 18 U.S.C. § 2; and 11 counts of money laundering, in

violation of 18 U.S.C. §§ 1956(a)(1)(A)(i), 2. The Government dismissed the money-

laundering counts prior to trial.

      Following a jury trial, Bachynsky was convicted on five counts (conspiracy to

commit securities fraud; three for wire fraud; and securities fraud). The jury acquitted

him on 13 counts; all others were dismissed at the close of the Government’s case in

chief. Bachynsky was sentenced, inter alia, to 168 months’ imprisonment.

                                          II.

      Challenged on appeal are the district court’s: denying defendant’s motion for

judgment of acquittal for the conspiracy charge (the securities and wire-fraud

                                           5
convictions are not so challenged); not applying SEC Regulation S-K’s standards for

material disclosures; not conducting a pre-trial Daubert hearing; allowing testimony

by a Special Assistant United States Attorney; ruling the Government did not violate

Rule 16 in failing to disclose defendant’s pre-trial statements; and not instructing the

jury on ambiguities in securities law and an entrapment-by-estoppel defense.

      In addition to claiming reversible error on each issue, defendant claims

cumulative reversible error. Because there is no error for any of the above-described

issues, there can be no cumulative error. See, e.g., United States v. Baker, 432 F.3d

1189, 1223 (11th Cir. 2005) (noting cumulative error requires an accumulation of

non-reversible errors by trial court).

                                          A.

      Bachynsky claims the district court erred in denying his motion for judgment

of acquittal due to insufficient evidence for his conspiracy conviction. As noted, he

does not similarly contest his securities and wire-fraud convictions.

      In order to preserve an insufficient-evidence claim: after the Government rests

its case, and before submission of the case to the jury, including after any rebuttal

evidence by the Government, defendant must move for judgment of acquittal on that

claim. See FED. R. CRIM. P. 29(a); see United States v. Edwards, 526 F.3d 747, 754-

56 (11th Cir. 2008). Because defendant did so, his insufficient-evidence claim is

                                           6
reviewed de novo, viewing the evidence in the light most favorable to the

Government, and determining whether a rational juror could have found defendant

guilty beyond a reasonable doubt. United States v. Gari, 572 F.3d 1352, 1359 (11th

Cir. 2009). “The jury is free to choose between or among the reasonable conclusions

to be drawn from the evidence presented at trial, and the court must accept all

reasonable inferences and credibility determinations made by the jury.” United States

v. Sellers, 871 F.2d 1019, 1021 (11th Cir. 1989) (citations omitted).

      The elements for proving a conspiracy under 18 U.S.C. § 371 are: (1) an

agreement between two or more persons to achieve an unlawful objective; (2)

knowing and voluntary participation in the agreement; and (3) an overt act by a

conspirator in furtherance of the agreement. United States v. Hasson, 333 F.3d 1264,

1270 (11th Cir. 2003). There was ample evidence upon which a rational juror could

have found defendant conspired with Anders (and others) to defraud investors

through false and misleading statements about Helvetia. The record is replete with

investors being induced to invest in Helvetia as the result of Bachynsky’s role in the

conspiracy.

      In that regard, Bachynsky’s relations with investor Daley are sufficient alone

to prove his conviction: Bachynsky represented he was a doctor and medical director

for Helvetia; in a meeting with Daley, Anders and Bachynsky falsely represented to

                                          7
him that drug trials in Mexico with the cancer drug had been successful; Bachynsky

gave Daley a copy of Helvetia’s business plan which included misrepresentations

concerning the success of ICHT and DNP and Helvetia’s exclusive control of the

accompanying technology; Bachynsky did not reveal Anders had been convicted of

securities fraud and barred from selling securities; and defendant similarly did not

disclose his 1989 convictions and loss of medical license. Bachynsky knew none of

this information was correct and succeeded in procuring $10,000 from Daley. Daley

testified he would not have invested in Helvetia had he known of Bachynsky’s 1989

convictions and loss of medical license, Anders’ fraud conviction, and the lack of

studies showing DNP and ICHT to be safe or effective.

      In short, there was sufficient evidence for a rational juror to find, beyond a

reasonable doubt, that Bachynsky knowingly entered into an agreement with Anders

to make false material representations and omissions in order to solicit money from

would-be investors. That Bachynsky was guilty of conspiracy was a reasonable

finding based upon the evidence. That, according to Bachynsky, he was somehow

duped by Anders, or misled by his attorney, or left in the dark concerning Helvetia’s

corporate records and business plans is to no avail. “It is not necessary that the

evidence exclude every reasonable hypothesis of innocence or be wholly inconsistent

with every conclusion except that of guilt . . . .” United States v. Bell, 678 F.2d 547,

                                           8
549 (5th Cir. Unit B 1982); see also United States v. Garcia, 447 F.3d 1327, 1338

(11th Cir. 2006).

                                         B.

      Bachynsky challenges the court’s permitting the Government to present

evidence concerning his not disclosing his 1989 convictions. Over his objection, the

Government was permitted to ask investor witnesses: whether, prior to investing,

they knew of the convictions and resulting loss of medical license; and whether they

would have invested had those convictions been disclosed.

      Defendant contends: there was no duty, general or otherwise, to disclose his

12-year-old convictions; and there is no duty to disclose when the SEC’s Regulation

S-K only requires disclosure of convictions from the past five years and material to

an investor’s evaluation of the company. Because defendant had a general duty to

disclose those convictions, we do not reach his contention concerning a specific duty

to disclose.

      Challenges to evidentiary rulings are reviewed for abuse of discretion. E.g.,

Baker, 432 F.3d at 1202. A court abuses its discretion when its decision “rests upon

a clearly erroneous finding of fact, an errant conclusion of law, or an improper

application of law to fact”. Id. “The abuse of discretion standard has been described

as allowing a range of choice for the district court, so long as that choice does not

                                          9
constitute a clear error of judgment.” United States v. Kelly, 888 F.2d 732, 745 (11th

Cir. 1989); see FED. R. EVID. 103(a) (no reversible error unless evidentiary ruling

affects party’s substantial rights).

      Bachynsky was convicted for securities fraud, in violation of the Securities

Exchange Act, 15 U.S.C. §§ 78j(b), 78ff(a), and 17 C.F.R. § 240.10b-5. The purpose

of that Act is to protect investors against fraud; accordingly, an individual or entity

making a disclosure in furtherance of the sale of securities has a duty to make those

disclosures complete and accurate. See S.E.C. v. Texas Sulphur Gulf Co., 401 F.2d

833, 860-61 (2d Cir. 1968).

      Along that line, § 10(b) is the Act’s central antifraud provision, with Rule 10b-

5 further defining unlawful conduct under that section. To prove a § 10(b) violation,

the Government must show “a misstatement or omission of material fact, made with

scienter”. S.E.C. v. Fehn, 97 F.3d 1276, 1289 (9th Cir. 1996) (internal citation and

quotation marks omitted).

      The duty to disclose “is a general one, and arises whenever a disclosed

statement would be ‘misleading’ in the absence of the ‘disclos[ure] of [additional]

material facts’ needed to make it not misleading”. Id. at 1290 n.12 (emphasis in

original). As the Supreme Court has stated, “[c]onduct itself can be deceptive”;

therefore, liability under § 10(b) or Rule 10b-5 does not require “a specific oral or

                                          10
written statement”. Stoneridge Inv. Partners, LLC v. Scientific-Atlanta, 552 U.S. 148,

158 (2008).

      A fact is material if there is a substantial likelihood a reasonable investor would

consider it important in making an investment decision. Basic, Inc. v. Levinson, 485

U.S. 224, 231-32 (1988). Accordingly, “materiality depends on the significance the

reasonable investor would place on the withheld or misrepresented information”. Id.

at 240.

                                           1.

      To solicit new investors, Bachynsky held himself out as both a legitimate

businessman and a licensed and qualified medical expert. Disclosure that he had

prior convictions and had lost his medical license, not to mention his failure to

disclose knowledge of Anders’ prior securities-fraud prohibitions, were all material

facts that, needless to say, “would have been viewed by the reasonable investor as

having significantly altered the ‘total mix’ of information made available”. Id. at

231-32.

      Therefore, such failure to disclose affected Helvetia’s potential investors.

Accordingly, the district court did not abuse its discretion in admitting evidence

concerning Bachynsky’s omissions in that regard. See also Breard v. Sachnoff &

Weaver, Ltd., 941 F.2d 142, 144 (2d Cir. 1991) (failure to disclose prior fraud

                                          11
conviction in initial offering memorandum could be considered reckless as a matter

of law); cf. S.E.C. v. Merch. Capital, LLC, 483 F.3d 747, 771-72 (11th Cir. 2007)

(noting clear error for court not to consider prior convictions or violations of court

orders).

                                         12
                                          2.

      Nevertheless, defendant contends he was not required to disclose his 1989

convictions because, as noted, Regulation S-K requires disclosure of a prior

conviction only when it is within five years and material to an investment decision.

17 C.F.R. § 229.401(f)(2), (g)(1). Defendant contends Regulation S-K is relevant

because it is promulgated by the SEC, which has authority over the enforcement of

federal securities laws, see United States v. Matthews, 787 F.2d 38, 44 (2d Cir. 1986);

and, according to the Third Circuit, disclosure obligations under Regulation S-K

“extend considerably beyond those required by Rule10b-5”. Oran v. Stafford, 226

F.3d 275, 288 (3d Cir. 2000).

      Defendant’s reliance upon Regulation S-K is misplaced and ignores that its

application is predicated upon an SEC filing. The regulation contains the disclosure

requirements for the nonfinancial statement portion of filings with the SEC: it

governs registration statements, annual reports, and “any other documents required

to be filed under the Exchange Act, to the extent provided in the forms and rules

under that Act”. 17 C.F.R. § 229.10(a)(2); see also Slayton v. American Exp. Co.,

604 F.3d 758, 768 (2d Cir. 2010). Bachynsky fails to show Regulation S-K should

apply in a context outside of SEC filings, to a point in time such as this, i.e.,

                                          13
Bachynsky’s material misrepresentations at the time of solicitation.

                                           C.

      Defendant next challenges the denial of his motion for a pre-trial Daubert

hearing (based upon Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579 (1993) and

Federal Rule of Evidence 702 (requiring court to consider whether expert testimony

is scientifically or technically valid and will assist trier of fact)). Defendant contends

the hearing would have prevented the admission of irrelevant and prejudicial

testimony by one of the Government’s expert witnesses, Dr. Sokol. The denial of a

Daubert hearing is reviewed for abuse of discretion, United States v. Hansen, 262

F.3d 1217, 1233 (11th Cir. 2001), as are rulings on the admissibility of expert

testimony, Allison v. McGhan Medical Corp., 184 F.3d 1300, 1306 (11th Cir. 1999).

                                           1.

      Bachynsky’s pre-trial Daubert motion, on whether the reasoning or

methodology underlying Dr. Sokol’s testimony was reliable, was denied without

prejudice. At trial, defendant objected to the relevance of Dr. Sokol’s testimony,

contending he lacked expertise with DNP. The court considered the objection, but

qualified Dr. Sokol as an expert in the fields of oncology and clinical pharmacology.

                                           14
      There is no requirement that a Daubert hearing always be held. See United

States v. Frazier, 387 F.3d 1244, 1264 (11th Cir. 2004); Hansen, 262 F.3d at 1234.

As is well known, the trial court’s obligation under Federal Rule of Evidence 702 is

to serve as the gatekeeper for the admission of scientific expert testimony. In

qualifying an expert witness, the court must consider whether:

             (1) the expert is qualified to testify competently regarding
             the matters he intends to address; (2) the methodology by
             which the expert reaches his conclusions is sufficiently
             reliable as determined by the sort of inquiry mandated in
             Daubert; and (3) the testimony assists the trier of fact,
             through the application of scientific, technical, or
             specialized expertise, to understand the evidence or to
             determine a fact in issue.
Frazier, 387 F.3d at 1260 (quoting City of Tuscaloosa v. Harcros Chems., Inc., 158

F.3d 548, 562 (11th Cir. 1998)); see FED. R. EVID. 702. In short, the court is to

“ensure that speculative, unreliable expert testimony does not reach the jury”.

McCorvey v. Baxter Healthcare Corp., 298 F.3d 1253, 1256 (11th Cir. 2002). In that

regard, it is understandably given “considerable leeway” in evaluating the testimony’s

reliability. Rink v. Cheminova, Inc., 400 F.3d 1286, 1291 (11th Cir. 2005) (quoting

Kumho Tire Co. v. Carmichael, 526 U.S. 137, 152 (1999)).

      There was no abuse of discretion. First, a Daubert hearing was not required

because the Government proffered sufficient information to allow the court to qualify

Dr. Sokol as an expert in areas of oncology and clinical pharmacology, and because

                                         15
defendant presented no evidence contesting Dr. Sokol’s testimony or scientific

knowledge. See Hansen, 262 F.3d at 1234 (a court should conduct a Daubert

inquiry when the opposing party presents conflicting expert testimony). Second,

Bachynsky objected to the relevance of Dr. Sokol’s testimony because he lacked

personal experience with DNP. The district court considered this objection and

determined the testimony was relevant because it assisted the jury in evaluating the

truthfulness and accuracy of Bachynsky’s and Helvetia’s human-safety claims. See

Daubert, 509 U.S. at 591-92 (noting a liberal standard for relevance to whether expert

testimony will aid jury in resolving the facts).

                                           2.

      Bachynsky further contends the Daubert hearing was necessary because it

would have prevented Dr. Sokol’s testifying erroneously that Bachynsky admitted to

a felony in 1986. Pursuant to defendant’s objection, the court struck that testimony

and instructed the jury to disregard it.

             An instruction to disregard evidence withdrawn from the
             jury is sufficient grounds for an appellate court to uphold
             a trial court’s denial of a motion for mistrial unless the
             evidence is so highly prejudicial as to be incurable by the
             trial court’s admonition. Such a level of prejudicial effect
             exists where there is a significant possibility . . . that . . .
             the stricken statement had a substantial impact upon the
             verdict of the jury.

                                           16
United States v. Sawyer, 799 F.2d 1494, 1505-06 (11th Cir. 1986) (quoting United

States v. Tenorio-Angel, 756 F.2d 1505, 1512 (11th Cir. 1985) (internal quotation

marks omitted)).

      There is no indication of any “significant possibility” of highly prejudicial

evidence. Again, pursuant to defendant’s objection, the district court immediately

struck the testimony and instructed the jury to disregard it; and the court denied

defendant’s motion for a mistrial, pursuant to the jury’s having previously received

evidence on Bachynsky’s 1989 convictions and medical license revocations.

      Defendant asserts the jury’s being told erroneously about a 1986 felony, in

addition to hearing about his 1989 convictions, was more prejudicial than evidence

on the 1989 convictions alone. The record indicates, however, that the testimony was

not prejudicial: the court gave a limiting instruction, see United States v. Trujillo,

146 F.3d 838, 844 (11th Cir. 1998) (court’s curative instruction to jury assuaged

potential prejudice caused by improper testimony); and defendant was acquitted on

most counts, see United States v. Mills, 138 F.3d 928, 936 (11th Cir. 1998) (not-guilty

verdict on most counts indicates jury’s consideration was not tainted by improperly

admitted evidence).

                                          D.

                                          17
      Defendant asserts the court erred by permitting Special Assistant United States

Attorney Sindler-Fuchs (SAUSA) to testify about the following statement made by

FBI Special Agent Andjich to defendant. In April 2001, Bachynsky contacted that

Agent to arrange for a voluntary interview concerning an unrelated fraud

investigation involving Kunen. Bachynsky was neither a target nor a suspect in that

investigation; however, his girlfriend was an investor in Kunen.

      At the meeting with Agent Andjich, the SAUSA, and an AUSA, Bachynsky

disclosed that he and Anders were working on an effort to market DNP as a cancer-

therapy drug. He informed them he was helping to create the Helvetia company and

had enlisted the help of an attorney to assist him in selling shares to investors.

According to the SAUSA’s challenged testimony, Agent Andjich replied: “Doc . .

. . Why would you do this? Why would you want to do this? You’re only going to

end up in prison . . . again.”

      Defendant claims: that testimony was inadmissible hearsay; and it was

impermissibly prejudicial. Defendant further contends the court erred by failing to

give a limiting instruction concerning the nature of the statement; and, as a result,

jurors were left unaware Agent Andjich’s statement was admitted only for purpose

of notice and not for the truth of the matter stated.

                                          1.

                                          18
      The district court did not abuse its discretion in admitting the SAUSA’s

testimony about the Agent’s statement. See, e.g., United States v. Brown, 441 F.3d

1330, 1359 (11th Cir. 2006) (“We review a district court’s hearsay ruling for abuse

of discretion.”). The hearsay bar does not pertain to statements used to show future

effect upon the listener; and, as the district court correctly noted, the SAUSA’s

testimony was presented to show Bachynsky was on notice regarding the legal

ramifications of his decision to work with Anders in forming Helvetia. See United

States v. Hawkins, 905 F.2d 1489, 1495 (11th Cir. 1990).

                                         2.

      As for defendant’s challenge to the lack of a limiting instruction, Federal Rule

of Evidence 105 states: “When evidence which is admissible . . . for one purpose but

not admissible . . . for another purpose is admitted, the court, upon request, shall

restrict the evidence to its proper scope and instruct the jury accordingly.” FED. R.

EVID. 105 (emphasis added). Because defendant did not make that request, review

is only for plain error. United States v. Miranda, 197 F.3d 1357, 1360 n.4 (11th Cir.

1999) (“Since the court had no duty to give a limiting instruction in the absence of

a request, we may reverse only if we conclude that the court’s failure to give the

instruction constituted plain error.”) Defendant cites ambiguity from the district

court’s statement (“I’ll be happy to give that limiting instruction again.”), made

                                         19
outside the presence of the jury, as justification for not renewing a request for a

limiting instruction. Ambiguity, however, is irrelevant; rather, the question is

whether Bachynsky could have renewed his request for the instruction. See id. at

1360 n.3. Bachynsky could have, but did not, do so.

      Moreover, even assuming the district court erred, any error did not, for plain-

error review purposes, affect Bachynsky’s substantial rights. “[I]t has generally been

held that failure to give [limiting instructions] amounts to plain error where . . . the

government’s case is weak and the statement is extremely damaging.” United States

v. Sisto, 534 F.2d 616, 624 (5th Cir. 1976) (quoting United States v. Lipscomb, 425

F.2d 226, 227 (6th Cir. 1970)). Unlike in Sisto, the SAUSA’s testimony was not the

only evidence before the jury for deciding whether Bachynsky’s conduct was

intentional.

                                          E.

      Defendant maintains the court erroneously denied his mistrial motion, made

outside the presence of the jury, based on the Government’s not disclosing, prior to

trial, the following comments Bachynsky made during the above-described April

2001 meeting with the SAUSA, among others.              The comments at issue are

Bachynsky’s questioning Agent Andjich, the SAUSA, and the AUSA about his new

business scheme: “Well, what do you think? Should I do this?”

                                          20
      Defendant demands a new trial because of the impact his comments might have

had upon his trial strategy. Federal Rule of Criminal Procedure 16(a)(1)(A) provides:

             Upon a defendant’s request, the government must disclose
             to the defendant the substance of any relevant oral
             statement made by the defendant, before or after arrest, in
             response to interrogation by a person the defendant knew
             was a government agent if the government intends to use
             the statement at trial.
FED. R. CRIM. P. 16(a)(1)(A) (emphasis added).

      The court ruled Rule 16 was never triggered, based on finding Bachynsky’s

statement was not the result of an interrogation. As a precautionary measure,

however, the court did not permit testimony regarding Bachynsky’s above-quoted

questions at the April 2001 meeting.

      Denial of a motion for a mistrial is reviewed for abuse of discretion. United

States v. Abraham, 386 F.3d 1033, 1036-37 (11th Cir. 2004); see also United States

v. Perez-Oliveros, 479 F.3d 779, 782 (11th Cir. 2007) (reviewing the appeal of

alleged Government violations of Rule 16). The Government’s failure to disclose

statements by defendant requires a mistrial when the “defense strategy may have been

determined by the failure to [disclose] . . . .” United States v. Noe, 821 F.2d 604, 607

(11th Cir. 1987) (internal citation and quotation marks omitted). There was no abuse

of discretion.

                                          21
      First, there is no indication that Bachynsky’s statement was made as part of a

Government interrogation. Uncontested is the fact that Bachynsky approached the

Government. Even though the meeting was held at the United States Attorney’s

office, “[t]he term ‘interrogation’ does not include instances, such as this, in which

the defendant initiated the conversation”. United States v. Otero, No. 90-1839, 1990

WL 157043, at *1 (7th Cir. 18 Oct. 1990).

      Second, the verbal exchange never rose to the level of an interrogation: words

or actions initiated by law enforcement officials “reasonably likely to elicit an

incriminating response from the suspect”. Pennsylvania v. Muniz, 496 U.S. 582, 601

(1990). Even in a custodial setting (which this was not), “absent words or actions

designed to elicit an incriminating response from a defendant, any statements made

by the defendant are considered voluntary”. Otero, 1990 WL 157043, at *1 (citing

Muniz, 496 U.S. at 603-04). Defendant has failed to show any form of interrogation

during this April exchange. Instead, he only presents questions posed by him to the

Government.

                                          F.

      Last, defendant contends the district court erred by refusing his requested

instructions on: ambiguities in securities law, concerning disclosure provisions

related to criminal backgrounds; and an entrapment-by-estoppel defense. While a

                                         22
district court’s refusal to give a requested instruction is reviewed for abuse of

discretion, we review de novo whether the evidence sufficiently supports a proposed

theory-of-the-defense instruction. United States v. Richardson, 532 F.3d 1279, 1289-

90 (11th Cir. 2008).

                                        23
                                           1.

      The contention regarding the claimed ambiguity in the law is based upon

defendant’s view of disclosure requirements and the above-discussed SEC Regulation

S-K. See generally United States v. Heller, 830 F.2d 150, 154-56 (11th Cir. 1987)

(“[W]hen the law is vague or highly debatable, a defendant—actually or

imputedly—lacks the requisite intent to violate it.”). Defendant contends: an

ambiguity in the law touches upon intent to violate the law; and, here, the instructions

were inadequate because they did not address the matter of ambiguity—rather, they

only provided general provisions of good faith, mistake of fact, and advice of counsel.

      There was no reversible error. Defendant is entitled to an instruction “relating

to a theory of the defense for which there is any foundation in the evidence . . . .”

United States v. Palma, 511 F.3d 1311, 1315 (11th Cir. 2008) (emphasis in original).

Defendant, however, fails to support his claim. See United States v. Billue, 994 F.2d

1562, 1568 (11th Cir. 1993) (“The trial court has authority to refuse to instruct the

jury on a defense where the evidence used to support it, if believed, fails to establish

a legally cognizable defense.”).

      As the district court properly noted, “there’s no factual basis in the record . .

. for the jury to possibly find that there was good-faith reliance on any ambiguity in

                                          24
these regulations, or a contradiction between what they purportedly say and what

[defendant’s attorney]’s advice was on their effect”. And, contrary to defendant’s

assertion, there is no imputed lack of intent to violate these regulations because, as

discussed supra, Regulation S-K does not govern the material statements made by

defendant to Helvetia investors. Moreover, defendant points to no conflicting expert

testimony or conflicting judicial opinions indicating legal uncertainty concerning

disclosure requirements and the securities fraud laws under which he was charged.

See, e.g., Heller, 830 F.2d at 154-55 (defendant entitled to legal uncertainty theory

after showing conflicting expert testimony and lack of applicable IRS statements).

                                          2.

      Concerning not instructing on entrapment-by-estoppel, defendant relies upon

a May 2001 meeting between Anders and federal agents, where Anders admitted to

certain wrongdoing concerning unrelated funds invested under the above-referenced

Kunen fraudulent-investment scheme. The meeting was conducted under a direct-use

immunity agreement between Anders and the Government as part of its investigation

of Kunen.

      At that meeting, Anders admitted to investigators he had lied to Bachynsky for

months concerning funds for that investment. Anders further disclosed to Agent

Andjich, the AUSA, and the SAUSA that he was actively selling investment

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opportunities with Helvetia, and recounted to them the financial worth of his

investments to date.

      Before leaving, and after hearing all Anders was doing with respect to Helvetia

and Kunen, the Agent said: “Just keep doing what you’re doing”. Following that

meeting, Anders apparently repeated this information to Bachynsky and informed him

(and later co-defendant Dean) that the FBI said “everything was okay” for Anders and

Bachynsky to continue their Helvetia work.

      As noted, whether there is sufficient evidence to constitute a triable issue of

entrapment by estoppel is a question of law, see United States v. Collazo, 885 F.2d

813, 814 (11th Cir. 1989), with the evidence being viewed in the light most favorable

to defendant, see United States v. Williams, 728 F.2d 1402, 1404 (11th Cir. 1984).

Along that line, to justify an entrapment-by-estoppel defense, defendant “must

actually rely on a point of law misrepresented by an official of the state; and such

reliance must be objectively reasonable . . . .” United States v. Eaton, 179 F.3d 1328,

1332 (11th Cir. 1999). Not only does an entrapment-by-estoppel defense require a

full disclosure by the party seeking to rely on official advice, see United States v.

Tallmadge, 829 F.2d 767, 774 (9th Cir. 1987); but, in order to rely upon a point of

law misrepresented by a government official, the statement must come from the

official directly and not through an intermediary, see Eaton, 179 F.3d at 1332 (“For

                                          26
a statement to trigger an entrapment-by-estoppel defense, it must be made directly to

the defendant, not to others.”).

      Obviously, the record lacks support for an entrapment-by-estoppel defense.

First, Bachynsky did not show that he fully disclosed relevant information to a

Government official. And, even if he did, he failed to show information came directly

from a Government official; instead, it came from an intermediary—Anders.

                                        III.

      For the foregoing reasons, the judgment is AFFIRMED.

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