Court Opinion

ID: 4402564
Source: CourtListenerOpinion
Date Created: 2019-05-31 17:44:05.981276+00
Date Added: 2024-06-11T14:52:12.255885
License: Public Domain

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                                   2019 Pa. Super. 176

    COMMONWEALTH OF PENNSYLVANIA               :   IN THE SUPERIOR COURT OF
                                               :        PENNSYLVANIA
                       Appellant               :
                                               :
                                               :
                v.                             :
                                               :
                                               :
    RICHARD HOLSTON                            :   No. 223 EDA 2016

                   Appeal from the Order December 21, 2015
       In the Court of Common Pleas of Bucks County Criminal Division at
                        No(s): CP-09-CR-0005331-2015

BEFORE: GANTMAN, P.J., BENDER, P.J.E., PANELLA, J., SHOGAN, J.,
        LAZARUS, J., STABILE, J., DUBOW, J., NICHOLS, J., and
        McLAUGHLIN, J.

CONCURRING AND DISSENTING OPINION BY McLAUGHLIN, J.: FILED MAY

31, 2019

        I agree with the Majority that the Commonwealth has waived its claim

that the trial court erred in granting Richard Holston’s motion for habeas

corpus as to the conspiracy and insurance fraud1 charges because it failed to

ensure this Court had a complete certified record. However, I would find the

Commonwealth presented a prima facie case that Richard Holston committed

perjury and obstruction of justice2 and therefore that the trial court erred in

granting the motion for habeas corpus as to those charges.

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1   18 Pa.C.S.A. §§ 903 and 4117(a)(2), respectively.

2   18 Pa.C.S.A. §§ 4902(a) and 5101, respectively.
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   I.      Factual History

        The charges at issue in this case stem from a criminal investigation that

started following an October 2013 fire at a mansion owned by the Risoldi

family. This was the third fire at the mansion since June 2009. The

investigation concerned an alleged insurance fraud scheme involving

homeowners’ insurance claims following the multiple fires. The claims

submitted by the Risoldi family following each fire included claims for damaged

window treatments, which the Risoldi family allegedly purchased from

Summerdale Mills. The Risoldi family’s insurer, AIG, declined to reimburse for

the window treatments following the 2013 fire without proof of the

replacement cost following the second fire. The Risoldi family initially claimed

proof of the replacement cost had been lost in the fire.

        Holston is the owner of Philadelphia Draperies, LLC, doing business as

Summerdale Mills. According to Holston, his brother-in-law, Abraham

Reichbach, gave him the Summerdale Mills business in January 2014. Prior to

January 2014, Holston had a fabrication shop that rented space from

Summerdale Mills and did fabric work for Summerdale Mills, including

fabricating window treatments.

        In August 2014, the Commonwealth issued a subpoena to “Summerdale

Mills and Design Center[,] Rick Holston[,]” requiring the production of all

records of business conducted between members of the Risoldi family and

Summerdale Mills, including canceled checks, invoices, and estimates for the

replacement of fabrics due to fires at the Risoldi mansion.

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     Holston testified before a grand jury in September 2014 and produced

68 documents in response to the subpoena. N.T., 9/16/14, at 11. The

documents consisted of diagrams related to window treatment fabrications.

Id. at 12. However, he did not produce any canceled checks, invoices,

estimates, or similar documents. Id. When asked where he found the

documents he produced, he stated, “I looked through any of the boxes that

had files that I could find to try to comply with the subpoena.” Id. He stated

he did not have any canceled checks, invoices, or estimates because

Summerdale Mills’ computer had allegedly died. He said:

        [The] computer hard drive, which . . . had everything
        financial, which had all the orders, invoices, everything, that
        hard drive died at the end of April, beginning of May of this
        past year. And then we called in several companies to try to
        restore it. And they were unable to do that. And then we
        sent it out to a company to see if they could restore it. They
        recently responded that it was not able to be recovered. And
        that was all the data that had been passed on to me from
        2006 on.

Id. at 12-13.

     When asked whether the company had kept hard copies of the sales

orders, Holston stated, “No. Not that I’ve seen,” claiming the company had

been “paperless.” Id. at 31. Holston testified that the company was

“handwriting everything now” because the company “[did not] have a

computer system.” Id. at 30. Holston stated that he continued to receive

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orders from the website, because he checked his email on his laptop.3 Id. at

41.

       Holston further stated that the records of his fabrication business, which

did work for Summerdale Mills prior to January 2014, would not reference

“Risoldi.” Id. at 25. He claimed the customer of the business was Summerdale

Mills, and Summerdale Mills did not reference specific customers when

requesting work from fabrication companies. Id. at 25-26.

       Holston testified he did not have access to the bank accounts for

Summerdale Mills prior to January 2014, because his brother-in-law allegedly

still controlled the bank accounts for the business prior to January 2014, and

Holston opened new accounts. Id. at 15, 18. He said that he had asked his

brother-in-law for documents, but his brother-in-law did not provide any. Id.

19-20.

       On October 9, 2014, agents from the Office of Attorney General

executed a search warrant at Summerdale Mills. N.T., 8/19/15, at 16. The

agents found more than 450 documents throughout the Summerdale Mills

offices related to Summerdale Mills’ work for the Risoldi family, including

documents from Holston’s office. The documents found by the agents
____________________________________________

3 Holston’s testimony is unclear as to whether it was one computer and one
hard drive that was broken or whether it was a “computer system” that was
broken. Although he said he now uses a laptop to access emails, and the
company is still “doing everything by hand,” he testified the employee who
prepares the company’s tax returns still had a functioning computer. N.T.,
9/16/14, at 56.

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included, among other things, invoices and work orders dated before April

2014. Id. at 19-53.4 The agents also found invoices from Philadelphia

Draperies to Summerdale Mills from 2010 and 2011, which had the Risoldi

name on it. Id. at 28, 52.5

    II.     Legal Analysis

          As noted by the majority, to establish a prima facie case, the

Commonwealth must “produce[] evidence of each of the material elements of

the crime charged and establish[] sufficient probable cause to warrant the

belief that the accused committed the offense.” Commonwealth v. Huggins,

836 A.2d 862, 866 (Pa. 2003) (quoting Commonwealth v. McBride, 595
A.2d 589, 591 (Pa. 1991)). “The evidence need only be such that, if presented

at trial and accepted as true, the judge would be warranted in permitting the

case to go to the jury.” Id. (citing Commonwealth v. Marti, 779 A.2d 1177,

1180 (Pa.Super. 2001)). Further, “[i]nferences reasonably drawn from the

evidence of record which would support a verdict of guilty are to be given

effect, and the evidence must be read in the light most favorable to the

Commonwealth.” Id. (quoting Marti, 779 A.2d at 1180).

____________________________________________

4 The documents were not made a part of the certified record. However,
agents did testify at the preliminary hearing about the search and the
documents they found.

5 The agents also observed operational computers, including an operational
computer in Holston’s office, and an operational central server system. Id. at
84-85. There does not appear to be any testimony as to any documents
retrieved from the computers or as to whether the computers and servers
were operational prior to Holston’s Grand Jury testimony.

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      A. Perjury

      To establish perjury, the Commonwealth must establish that the

defendant “in any official proceeding [made] a false statement under oath or

equivalent affirmation . . . when the statement is material and he does not

believe it to be true.” 18 Pa.C.S.A. § 4902(a). The statute defines “materiality”

as follows:

         Falsification is material, regardless of the admissibility of the
         statement under rules of evidence, if it could have affected
         the course or outcome of the proceeding. It is no defense
         that the declarant mistakenly believed the falsification to be
         immaterial. Whether a falsification is material in a given
         factual situation is a question of law.

Id. at § 4902(b). The statute further provides that “[i]n any prosecution under

this section, except under subsection (e) of this section, falsity of a statement

may not be established by the uncorroborated testimony of a single witness.”

Id. at § 4902(f).

      Here, the Commonwealth claims Holston presented false testimony

before the grand jury and the evidence gathered following the execution of a

search warrant establishes that the testimony was false.

      The trial court found, and the Majority agrees, that the Commonwealth

failed to establish a prima facie case of perjury. Prior to his grand jury

testimony, Holston appeared for an interview with the Commonwealth on

September 2, 2014. In finding the Commonwealth failed to present a prima

facie case, the trial court reasoned that “the [Commonwealth] failed to

establish any variance between Holston’s comments on September 2 and his

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Grand Jury testimony as there was no evidence presented as to what he said

on September 2.” Trial Court Op., filed Dec. 21, 2015, at 10-11. The trial court

next stated Holston “was not in legal possession of Summerdale [Mills’] pre-

2014 records and had no duty to produce them.” Id. at 11. The court found

that “[t]he fact that the item is in an area that defendant has access to does

not establish his control over it, let alone his intent to possess it.” Id. at 12.

The court stated “[t]here was no evidence, direct or circumstantial, of

Holston’s intent to possess or control the pre-2014 documents of Summerdale

Mills. As the pre-2014 Summerdale Mills’ records were not Holston’s, he had

no duty to produce them and was improperly held on the perjury count.” Id.

      The Majority quotes the trial court’s analysis and states it “correctly

determined the Commonwealth failed to present a prima facie case that

[Holston] committed perjury while testifying before the grand jury.” Majority

at 16. It concludes that the “Commonwealth failed to set forth sufficient

evidence beyond mere suspicion that [Holston] had any knowledge of the

existence of the documents that were discovered during the execution of the

search warrant.” Id. It further concluded that “[t]here is no indication in the

record that [Holston] knew that his statements regarding his inability to

present additional documentation pursuant to subpoena were false.” Id. at

17.

      Respectfully, I believe that in reaching this conclusion the Majority is

making credibility determinations and weighing the evidence, which should

not   be   done   when   addressing    a   motion   for   habeas   corpus.   See

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Commonwealth v. Ouch, 199 A.3d 918, 923 (Pa.Super. 2018) (quoting

Marti, 779 A.2d at 1180). I would conclude that the trial court erred in

granting the motion for habeas corpus and finding the Commonwealth failed

to establish a prima facie case to support the perjury charge.

      First, the Commonwealth does not argue that the September 2 interview

forms the basis for the perjury charge. Therefore, the trial court’s conclusion

that the Commonwealth failed to establish a variance between statements

from the September 2 interview and the Grand Jury testimony is irrelevant.

      Second, I do not agree that Holston had no legal obligation to produce

documents in the possession of Summerdale Mills, a company that he owned

at the time of the issuance of the subpoena. The subpoena was sent to

“Summerdale Mills and Design Center[,] Rick Holston[,]” and required the

production of all records of business conducted relating to certain individuals.

A company cannot avoid its obligations under a subpoena by transferring

ownership to a new individual, who could then claim he had no legal right to

the records of the company he now allegedly owns. A subpoena’s command

is personal, and if Holston had the documents, he had a duty to produce them.

It is irrelevant that the requested documents allegedly came into being before

Holston owned the company.

      Further, contrary to the trial court’s finding, Holston’s legal obligation as

to the documents does not impact whether he, in fact, committed perjury.

Rather, when testifying before the Grand Jury, he was asked about his

compliance with the subpoena, and he responded, “I looked through any of

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the boxes that had files that I could find to try to comply with the subpoena.”

Id. at 12. In those boxes he claimed he found only 68 documents, and found

no canceled checks, invoices, or work orders. Holston did not say that he

lacked access to any part of the building when searching for and through

boxes. A month later, when the Commonwealth executed a search warrant, it

also looked through boxes, and found more than 450 documents related to

the Risoldi family, including invoices, work orders, and estimates.

      Holston further stated that he did not produce any canceled checks,

invoices, or estimates because Summerdale Mills’

         computer hard drive, which . . . had everything financial,
         which had all the orders, invoices, everything, that hard
         drive died at the end of April, beginning of May of this past
         year. And then we called in several companies to try to
         restore it. And they were unable to do that. And then we
         sent it out to a company to see if they could restore it. They
         recently responded that it was not able to be recovered. And
         that was all the data that had been passed on to me from
         2006 on.

Id. at 12-13. When asked whether the company had kept hard copies of the

sales order, Holston stated, “No. Not that I’ve seen,” claiming the company

had been “paperless.” Id. at 31. Again, when the agents executed the search

warrant, they found hard copies of invoices and work orders that predated the

claimed loss of the computer hard drive.

      Holston further stated that the records from the fabrication business he

owned before January 2014, which did work for Summerdale Mills, would not

reference the Risoldi name, as the customer of the fabrication business was

Summerdale Mills, and Summerdale Mills did not reference specific customers

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when it requested work from fabrication companies. In contrast, however,

when executing the search warrant, the agents located invoices from

Philadelphia Draperies to Summerdale Mills which referenced “Risoldi.”

       Holston never claimed he did not produce documents because he had

no legal right to the documents or that he had limited access to areas of the

office. Rather, he claimed he searched the boxes, the computer was not

working, Summerdale Mills did not keep hardcopies of invoices, and

Summerdale Mills did not inform its subcontractors of the clients for whom the

subcontractor was doing work.6 The agents’ discovery of documents in areas

to which Holston had access raises a strong inference that Holston’s testimony

before the grand jury was not truthful.

       The statements would be material, as the Grand Jury was investigating

insurance fraud on the part of the Risoldi family, who alleged they had no

documentation to support the claimed replacement cost of the drapes.

       Further, contrary to the Majority, I believe the Commonwealth’s

evidence was more than mere suspicion or conjecture. Rather, the evidence

would support a finding that Holston committed perjury, that is, that he made

a false statement under oath, the statement was material, and he knew the

statement was false. See 18 Pa.C.S.A. § 4902(a). Accordingly, viewing the

evidence in the light most favorable to the Commonwealth, I would find that

____________________________________________

6 Holston also claimed he asked his brother-in-law for documents, and his
brother-in-law did not provide any, and claimed he could not access the bank
account information for the company prior to January 2014.

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the Commonwealth presented sufficient evidence to establish a prima facie

case of perjury.

      B. Obstruction

      The Majority finds the Commonwealth waived its claim that it presented

a prima face case of obstruction of justice because it failed to ensure the

certified record included the documents that Holston produced in response to

the subpoena and failed to include such documents in the reproduced record.

I disagree. Holston described the documents in his Grand Jury testimony and

agreed at that time that they do not contain invoices or estimates. I would

therefore find that we can adequately review this claim.

      Obstruction of justice is defined as follows:

         A person commits a misdemeanor of the second degree if
         he intentionally obstructs, impairs or perverts the
         administration of law or other governmental function by
         force, violence, physical interference or obstacle, breach of
         official duty, or any other unlawful act, except that this
         section does not apply to flight by a person charged with
         crime, refusal to submit to arrest, failure to perform a legal
         duty other than an official duty, or any other means of
         avoiding compliance with law without affirmative
         interference with governmental functions.

18 Pa.C.S.A. § 5101. To establish a person obstructed justice, the

Commonwealth must establish that “(1) the defendant had the intent to

obstruct the administration of law; and (2) the defendant used force or

violence, breached    an official   duty   or   committed   an unlawful   act.”

Commonwealth v. Goodman, 676 A.2d 234, 235 (Pa. 1996).

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     Comparing Holston’s Grand Jury testimony with the documents and

items found during the execution of the search warrant, I believe the

Commonwealth established a prima face case of obstruction of justice.

Viewing the evidence in the light most favorable to the Commonwealth, the

evidence supports a finding that Holston intended to prevent the government

from gaining access to documents relevant to the criminal investigation, and,

in doing so committed an unlawful act, that is, perjury. See Commonwealth

v. Feese, 79 A.3d 1101, 1123-24 (Pa.Super. 2013) (finding sufficient

evidence of obstruction of justice where defendant and co-conspirator

withheld documents that should have been turned over to the Office of

Attorney General pursuant to subpoenas and altered documents prior to

producing them).

     C. Conspiracy and Insurance Fraud

     The Majority claims that the Commonwealth waived the claims that it

presented sufficient evidence to support prima facie cases of conspiracy and

insurance fraud because the certified record does not contain the documents

from the binder, which form the basis of the conspiracy and insurance fraud

claims. I also note that although the reproduced record contains some

testimony from a preliminary hearing describing the documents, the transcript

from the relevant preliminary hearing is not part of the certified record, and

the reproduced record includes only a portion of the transcript. I therefore

agree with the Majority that the Commonwealth has waived its claim that it

presented prima facie cases of conspiracy and insurance fraud.

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      In conclusion, I agree with the Majority that the Commonwealth waived

its claim that it presented sufficient evidence of prima facie cases of conspiracy

and insurance fraud. However, I disagree with the Majority as to the perjury

and obstruction of justice charges. I would find the Commonwealth presented

sufficient evidence to support a prima facie case that Holston committed

perjury and obstruction of justice and that the trial court erred in granting

Holston’s motion for habeas corpus as to those charges.

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