SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: PART 41

Defendants.

Indictment #2589/2010

THE PEOPLE OF THE STATE OF NEW YORK

-against-

JOHN F. HAGGERTY,JR., and

SPECIAL ELECTION OPERATIONS, LLC,

MEMORANDUM OF LAW

This Memorandum of Law and the accompanying affirmation are submitted in

opposition to the joint motion of defendants John F. Haggerty, Jr. (,Haggerty''), and Special Election Operations ("SEO''), LLC (collectively, the "defendants'') for: (1) discovery pursuant

to Bratfy and Criminal Procedure Law ("CP L.'') § 240.20; (2) notice of all specific instances of

prior uncharged criminal, vicious, or immoral conduct of defendants pursuant to CP.L. §

240.43; (3) a Sandoval Hearing; (4) a Bill of Particulars; (5) inspection of the grand jury minutes

by the court and defendants and a dismissal of the indictment pursuant to CPL. § 21 0.20(1) (b),

or, a reduction of the charges pursuant to CPL. § 210.20(1-a); (6) an opportunity to request a

hearing to suppress physical evidence; (J) an opportunity to move to challenge the search

warrant; (8) an order dismissing all charges pursuant to CPL. § 21O.20(1)(b) and (c); (9) an

order reducing Grand Larceny in the First Degree pursuant to CPL. § 210.20(1)(b) and (c); and

(10) dismissal of all charges in furtherance of justice pursuant to CPL. § 210.40.

For the reasons set forth below, except where expressly consented to, the defense

motions should be denied. The evidence before the Grand Jury was legally sufficient to

sustain the counts in the indictment. The evidence showed repeated and detailed false

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statements by Haggerty for the express purpose of obtaining more than one million dollars

from Mayor Bloomberg. He concocted a fake budget, an elaborate procedure to launder

funds, and a shell company, and, when the scheme was discovered, he created fake checks as

part of a doomed cover-up.

FACTS

In 2009, the mayor of New York City, Michael R. Bloomberg campaigned for re-

election seeking a third term in office (the "Campaign"), Haggerty ostensibly worked as a

volunteer for the Campaign. (GJ Min. at 144,205).1 Although Haggerty was offered a salary

many times, he refused because he said he wanted the freedom to walk away from the job at

any time. (GJ Min. at 145). One of Haggerty's assigned duties during the Campaign was to

oversee a ballot security operation on Election Day, November 3, 2009, (the "Operation").

(GJ Min. at 146, 206). The Operation was intended to ensure that polling stations were

running properly on Election Day, that the voting machines were in working order, and that

election laws were followed. (GJ Min. at 145-46). In 2001 and 2005, similar operations had

been run using the Republican Party. (GJ Min. at 206). Because Mayor Bloomberg was no

longer a member of the Republican Party, the 2009 Operation was to be run using the New

York State Independence Party (the ''NYSIP'').

A. Haggerty's Scheme to Obtain the Mayor's Money Through Detailed False Statements

Beginning in or around August 2009, and continuing through October 2009,

Haggerty participated in meetings with senior members of the Campaign and aides to Mayor

Bloomberg, and had input into the decision to choose the NYSIP as the entity to carry out

the Operation. (GJ Min. at 146-147, 206, 234-241, GJ Exhs. 16 and 19). Haggerty

I The transcript of the testimony before the Grand Juty will be referred to as "GJ Min." The exhibits entered into evidence in the Grand J illy will be referred to as "GJ Exh( s)." The minutes and the exhibits are being submitted in camera to the Court.

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submitted budget proposals for the Operation to senior aides to Mayor Bloomberg and employees of the Campaign. (GJ:Min. at 167, 207-209, 218, 226,235-239; GJ Exh. 19).

In fact, Haggerty was required to, and did, provide a detailed written budget before any funding would be recommended or approved. (GJ Min. at 218; Affinnation of Eric Seidel, Exhibit 1). Haggerty's budget provided that the Operation would be "officially conducted through the New York State Independence Party due to a better political relationship and field organization than the New York State Republican Party," (GJ Min. at 210,214; GJ Exh. 19) and would be paid for using Mayor Bloomberg'S personal funds. (GJ Min. at 212,226,237; GJ Exh. 19). Haggerty's budget provided for 1355 poll sites around New York City, to be covered on 220 different routes on Election Day. Each route, consisting of approximately six to ten poll sites, would be patrolled by a poll-watcher and a lawyer, who were to be given the use of a chauffeured car to assist them in getting to each polling site along their respective routes. Each of the 1355 poll sites would also have a stationary poll-watcher assigned to that location for the entire day. The poll-watchers and drivers were to be compensated, while the lawyers were classified as unpaid volunteers. (GJ Min. at 172-173; GJ Exh. 17).

Haggerty's budget for the Operation called for each of the 1355 poll-watchers to be paid $350 for the day, for a total listed cost of approximately $474,250. The budget also estimated the cost for 230 drivers, each to be paid $600 for a 20-hour hour work day, costing approximately $138,000. There were also allotments for a staff of 25 people ($12,500), car rentals ($25,000), 240 pieces of telecommunications equipment ($25,000), 105 hotel rooms ($20,000), buses ($5,000), and even the catering of three meals for 450 people ($22,500), as well as various other costs. (GJ Exhs. 17 and 20). Among other expenditures, the budget also called for headquarters in both New York City and Albany to be staffed from

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September 14,2009 until November 6, 2009. The cost for office space would be $60,000. The budget also identified a «director" of the Operation who would receive $30,000. (GJ Exhs. 17 and 20). The total cost of the operation was estimated at $1,076,750. (GJ Exhs. 17 and 20).

Haggerty presented a budget that listed the costs on Election Day as totaling over $750,000, and the costs leading up to Election Day as totaling $310,000. (GJ Exhs. 17 and 20). In the email by which he transmitted the plan and budget. Haggerty specifically (and falsely) represented that «It]his project was started several weeks ago and many of the contta~ts were signed then and the invoices are now due so we need to do this as quickly as possible." (GJ Min. at 211-212; GJ Em. 19). He further stated that the «money needs to be wired as soon as possible" to the housekeeping account of the NYSIP. (G J Min. at 211, G J Exh 19). Contrary to these representations, there were no contracts or invoices which had to be paid, or indeed were ever paid, with the exception of a scattering of de minimis amounts.

(GJ Min. at 327-328).

On October 28,2009, the day after defendant Haggerty sent the email to top aides to Mayor Bloomberg, Haggerty met with them, as well as with Mayor Bloomberg himself, to discuss the ballot security operation. Based on Haggerty's representations at this meeting and earlier, Mayor Bloomberg's aides recommended approval of the funding of Haggerty's operation. (GJ Min. at 214-216,226-227).

Two days after the October 28 meeting, on October 30, 2009, Haggerty met again with aides to Mayor Bloomberg, who were to evaluate the reasonableness of the costs of the ballot security operation and, if they were to :find the costs reasonable, would arrange the transfer of funds to pay for the Operation. (GJ Min. at 168). At this meeting, Haggerty provided the same false description of the Election Day Operation and proposed budget

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that he had provided previously to another aide to the Mayor. (GJ Min. at 166-167,234-236). During the meeting Haggerty made further representations about the ballot security operation. Indeed, Haggerty again told Mayor Bloomberg's aides that most of the expenses listed in the budget "had already been paid or incurred." (GJ Min. at 169, 177-178). Again, this was absolutely false.

Three witnesses testified before the Grand Jury who had authority to direct money transfers from Mayor Bloomberg's personal account on his behalf (GJ Min. at 318-319):

Grand Jw:y Witness #1 (GJ Min. at 186-187), Grand Jury Witness #2 (GJ Min. at 186-187, 234), and Grand Juxy Witne~s #3 (GJ Min. at 187). Based on Haggerty's misrepresentations, they transferred $600,000 to the NYSIP Housekeeping Account on October 30, 2009. (GJ Min. at 187-188), and then transferred a second payment of $600,000 on November 2,2009 (GJ Min. at 189). In conveying the instructions to Grand Jury Witness #1 to make the money transfers, Grand Jury Witness #2 relied on Haggerty'S false statements about the costs already incu:r:red and to be incurred in the Operation. (GJ Min. at 241).

Haggerty directed Mayor Bloomberg's representatives to send the mayor's money to the NYSIP's housekeeping account (the "Housekeeping Account'') to pay for the Operation (GJ Min. at 210; GJ Exh. 19) and indicated that the Chairman of the NYSIP, Frank MacKay, along with one of the NYSIP's Vice-Chairmen, Tom Connolly, were «aware and fully cooperative." (GJ Min. at 211; GJ Exh. 19). Part of the payment to the NYSIP from Mayor Bloomberg also included a $100,000 donation to the NYSIP, which Mayor Bloomberg and his aides intended to make, and is not part of the charged offenses. (GJ Min. at 212).

To convince Mayor Bloomberg's aides of the need to fund the Operation, Haggerty falsely claimed that the "project was started several weeks ago and many of the contracts were signed then and the invoices are due so we need to do this as quickly as possible." (GJ

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Min. at 211-212; GJ Exh. 19). Haggerty also met with senior staff members from the Campaign, and with Mayor Bloomberg himself, to whom defendant presented plans for the Operation. (GJ Min. at 165-172, 178-179,214-216,224,226-227,229,235-241,243-244; GJ Exhs. 7,20). Relying on Haggerty's budget, Mayor Bloomberg's aides who had his authority to approve the expenditure of his personal funds for the Operation, approved expenditure of the mayor's funds for the Operation. (GJ Min. at 214, 224-27, 241, 318-19). Once Haggerty's budget was vetted and ultimately approved, $1.2 million of Mayor Bloomberg's personal funds were wired to the Housekeeping Account in two transfers of $600,000 each, on October 30, 2009, and November 2, 2009, ~espective1y. (GJ Min. at 187-189, 366; GJ Exhs. 7 and 8).

As stated, Haggerty's representations about the Operation's budget were false.

Haggerty only spent at most $32,000 of the Mayor's money on expenses connected to the Operation. Furthermore, the NYSIP was merely a pass-through vehicle through which Haggerty would ultimately receive Mayor Bloomberg's stolen money. One high-ranking official in the NYSIP testified that the NYSIP was not involved in the Operation on Election Day (GJ Min. at 24,44-45,51-52, 73-74, 143); and a second high ranking official in the NYSIP was not aware of anything the NYSIP did on Election Day in connection with a ballot security operation. (GJ:Min. at 344, 365).

B. Haggerty Makes an Agreement and Creates a Shell Company

On or about October 15, 2009, Haggerty purportedly entered into a "consulting agreement" with the NYSIP for the creation and design of a "poll watching/ballot security plan" for the "November 2009 General Election in New York." This agreement identified Haggerty as the "sole member" of defendant SE~, claimed to be located at 121 State Street in Albany, New York, and provided that Haggerty, through SE~, would receive no more

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than $1.1 million as a supposed fee. (GJ Exh. 7). The agreement was signed by Haggerty and Thomas Connolly, who was identified as the Vice-Chairman of the NYSIP. (GJ Min. at 357-358, 416-418; GJ Exh, 7). Mayor Bloomberg's aides and members of the Campaign were not aware of this agreement, nor of Haggerty's formation, use, or even the existence of

SEQ. (GJ Min. at 151-152, 215,228,243).

In fact., SEQ was a shell company designed to enable Haggerty to hide his theft of funds from Mayor Bloomberg. Although ostensibly existing to conduct the Election Day Operation, SE~ was actually incorporated December 3, 2009, about one month tifter the election. Moreover, SEO's stated address at 121 State Street, Third Floor, in Albany was fiction. SEC never had an office at that location, received no mail, and no one claiming to work for SEQ ever performed any work there. (GJ Min. at 197). Furthermore, Haggerty opened a business bank account for SEO only on December 9, 2009, more than one month after the election. (GJ Min. at 308-309,415-423; GJ Exh. 4). No funds were ever expended from SEO to pay for the Operation on Election Day. (GJ Min. at 323-324). In total, only about $32,000 of the allotted $1.1 million was spent on anything that could even arguably be associated with ballot security or poll watching. (GJ Min. at 327).

C. Haggerty's Purchase of a House With Mayor Bloomberg's Money

Prior to Haggerty'S involvement in the Campaign, he had expressed interest in purchasing a home located at 115 Greenway North in Forest Hills, New York, which had belonged to his late father (the "House"). (GJ Min. at 292-293). On or about December 9, 2009, Haggerty sent an invoice to the NYSIP from SE~ for "Consultant Fees for November 2009 Election Poll Watcher Plan - $750,000.00." (GJ Exh. 7). On December 11, 2009, $750,000 was transferred by the NYSIP from the Housekeeping Account to SEQ's

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bank account. (GJ Min, at 359-365,370,377). Haggerty used that money to buy the House

(GJ J\fin. at315-317; GJ Exhs. 4 and 23).

D. The Cover-up

In early February 2010, the Campaign received press inquiries concerning SEQ and

the Operation. (GJ Min. at 98-100, 103-104; GJ Exh. 9). Haggerty, responding to questions

from the press and the Campaign, tried to hide the fact that he used the Operation money to

buy the House. He falsely told the Campaign that he used the budgeted Operation money

to pay for its expenses. (GJ Min. at 115-117, 119-121, 123-25, GJ Exhs. 12, 13, 14). As part

of his deception, Haggerty provided to Mayor Bloomberg's campaign staff copies of three

SEQ checks, each for $500 and purportedly payable to three different individuals, as his

claimed proof that he paid poll watchers for their services in connection with the

Operation." (GJ:Mm. at 109-115; GJ Exh. 11; Affirmation of Eric Seidel, Exhibit 2). An

employee of the Campaign, believing Haggerty's representation that the checks represented

legitimate payments to poll watchers, forwarded them to the press. (GJ:Min. at 107-109; GJ

Exh. 10). In fact, the checks were bogus and were written and back-dated by Haggerty to

deceive the press and the campaign staff. The purported payees on those checks never

received payment from Haggerty for work done on Election Day 2009. (GJ Min. at 246-

253,267-269,271,275-280, GJ Exh. 15).

ARGUMENT

Haggerty has advanced numerous motions and challenges to the indictment, all of

which are without merit. We address each below in the order in which the arguments are

advanced in the defendants' Memorandum of Law.

2 These checks are the falsified business records referred to in the Third, Fourth and Fifth Counts of the Indictment.

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POINT ONE

THE PEOPLE HAVE COMPLIED WITH THEIR BRADY AND DISCOVERY OBLIGATIONS

The defendants request various items which they characterize as Brady material,

including "documents, correspondence. emsils or notes generated by Bloomberg for Mayor

2009" (De£ Aff. at 2 ~~ 5-7).3 The defendants' request should be denied. Such items are

not Bracfy material. The People are aware of and have to the best of their ability fulfilled

their obligations pursuant to Bratfy u: Maryland, 373 U.S. 83 (1963), and its progeny.

Bratfy does not require full disclosure to defendant of the prosecutor's entire file.

United States v. BagkJ, 473 U.S. 667 (1985). Rather, the purpose of the Brady rule is to assure

that defendants will not be denied access to evidence that is clearly exculpatory. United States

s. Ruggiero, 472 F.2d 599 (2d Cit. 1973), cert. denied, 412 U.S. 939 (1973). Moreover, it is well

settled that in order to be classified as Brady material, the evidence must be so favorable to

defendant to be considered materially exculpatory. People v. Rusfo, 109 A.D.2d 855 (2d Dept

1985); People v. Pugh, 107 A.D.2d 521 (4th Dept. 1985). Evidence is not transformed into

Bratfy material merely because it is not as conclusively inculpatory as other evidence

presented by the prosecution. People v. Christopher, 101 A.D.Zd 504 (4th Dept 1984). rev'd 011

other grounds, 65 N.Y.2d 417 (1985). The material sought by defendants is not Bratfy but

rather-a demand for purely evidentiary material cloaked as a Brat!J request.

Additionally; the defendants request discovery material pursuant to C.PL. § 240.20

(Def. Af£. at 3-6 ~ 8). The People have provided and will continue to provide the

defendants with discovery material as required by CP .L, § 240.20. To date, the defendants

have received the search warrant affidavits and viewed items recovered pursuant to the

3 "Def AfE" refers to Defendants' Affirmation in Support of their Notice of Motion dated September 16, 2010.

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search warrants including material contained in Haggerty's computers. Additionally, on this date, the defendants will be served with a VDF. Defendants' request for material clearly outside of the scope of discovery should be denied (Def. AfE. at 4-61J 8 (g) (1-19».

Discovery in a criminal case in New York is a creature of statute. See, Matter oj Constantine u: I.eto, 77 N.Y2d 975 (1991); Matter of MiDer v. Schwa~ 72 NY.2d 869, 870 (1988). "Discovery which is unavailable pursuant to statute may not be ordered based on principles of due process because 'there is no general constitutional right to discovery in criminal cases." MatterojPirro v. LaCava~ 230 A.D.2d 909, 910 (2d Dept. 1996), app. denied, mot. denied, 89 N.Y.2d 813 (1997) (quoting Matter ojMiller v. Schwartz at 870). Consequently, where a defendant has no statutory right to pre-trial discovery, his request should be denied. Miller u: Schwart~ 72 NY.2d 869 (1988); Piaari v. Pirro, 258 A.D.2d 202, 207, (citations omitted) (2d Dept. 1999) ("during the course of a criminal action, it is not within the authorized powers of the courts to compel disclosure which is not provided for in CP.L. Article 240 It); Sackett v. Bartlett, 241 A.D2d 97, 101, (3d Dept. 1998) ("County Judge exceeded his authority in directing discovery far beyond that prescribed in c.p L. article 240 and relevant constitutional provisions; it is settles law that there is no constitutional right to discovery in a criminal case."). "Indeed, C.PL. 240.40 sets forth the limited circumstances under which the court is authorized to direct discovery." Matter 0/ Catterson fl. RtJhf, 202 AD.2d 420, 423 (2d Dept. 1994). All items listed in DeE. Aff. at 4-61J 8 (g) (1-19) are clearly beyond the scope of discovery and the People request that the Court reject defendants' request.

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POINT TWO

THE PEOPLE WILL DISCLOSE PRIOR UNCHARGED CRIMINAL, VICIOUS, AND IMMORAL ACTS PURSUANT TO C.P .L. § 240.43

Defendants request that the People provide all instances of defendants' pnor

uncharged criminal, vicious or immoral conduct or defendants' other bad acts of which the

People have knowledge and intend to use at trial pursuant to c.P.L. § 240.43. This request

should be denied at this time. The People have not yet formulated a list of the defendants'

uncharged bad acts that will be offered at trial as proof in their case-in-chief. However, the

People are not required to disclose their intent to use such evidence at any particular time.

The riming of such disclosure will depend on the particular circumstances of the individual

case. The People are not required to provide pre-trial discovery of uncharged crimes offered

under a MoJineux theory and a Ventim;glia hearing may be conducted during trial See People v.

McLeod, 279 A.D.2d 372 l st Dept. 2001). However, the People will disclose their intent to

use such evidence sufficiently in advance of trial to obviate the need for any delay in the

commencement of the trial, and allow the defense a full opportunity to contest the

inttoduction of such evidence.

POINT THREE

DEFENDANT'S REQUEST FOR A SANDOVAL HEARING

The People respectfully request that this matter be deferred for consideration by the

trial judge. Immediately prior to the commencement of trial, the People will provide notice

of prior uncharged criminal, vicious, or immoral acts that the prosecutor intends to use at

trial to impeach the credibility of the defendant. See C.PL. § 240.43.

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POINT FOUR

DEFENDANTS' APPLICATION

FOR A BIll OF PARTICULARS SHOULD BE DENIED

The defendants seek a bill of particulars (Def. AfE at 7-11 11 12). The defendants'

requests, including a request for the names of Mayor Bloomberg's "Agents," are discovery

devices designed to elicit matters of evidence as to how the People intend to prove the charges

in the indictment and hence are not appropriate for a bill of particulars. The defendants'

requests are meritless and should be denied.

It is well settled that a bill of particulars provides for the release of information

pertaining to the "substance of each defendant's conduct encompassed by the charge which the

People intend to prove at trial on their direct case," but not how that charge will be proved

c.P.L. § 200.95 (1) (a); See Preiser, Practice Commentaries, McKinney's Cons Laws ofNY', Book

11A, c.P.L. § ZOO.95, at 539-40 (defendant not entitled in a bill of particulars to evidence that

will be used to prove the prosecution theory at triaI). The People are not required to provide

evidentiary material in a bill of particulars; it is not a contrivance to obtain discovery. Peuple v.

Davis, 41 NY.2d 678, 680 (1977) ("[a] bill of particulars serves to clarify the pleading; it is not

a discovery device"); People v. Cusani, 153 A.D.Zd 574 (Zd Dept. 1989) (discovery request

which sought evidentiary items was properly denied); (People v. Smith, 103 AD.Zd 859, 860

(3d Dept. 1984) (items sought by defendant in a bill of particulars was properly denied

because they were evidentiary); (People v. King, 48 A.D.Zd 457, 460 (1st Dept. 1975)

(evidentiary matters are not the proper subject of a bill of particulars).

The defendants have been provided with an overwhelming amount of informacion in

a detailed indictment, a detailed forfeiture complaint, and pursuant to an ongoing discovery

process. For instance, the instant "speaking" indictment provides a specific roadmap of how

Haggerty and SE~ committed the crimes charged. The Third, Fourth and Fifth Counts

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provide defendants with the type of business record, the number of the check, its date, and purported purpose. Additionally, defendants have been provided with significant discovery during protracted discussions between Haggerty, defense counsel and the People, For instance, Haggerty, in the presence of his attorney, engaged in two interviews at the District Attomey's Office, during which information as to the charges was discussed. Haggerty spent at least two days reviewing material contained in his computers seized during the execution of search warrants and defense counsel has also reviewed material seized pursuant to the search warrants.

Moreover, the factual discussion in this Memorandum of Law contains clear and detailed information regarding the charges. The defendants' request for further particulars should therefore be denied. See People v. Choi, 259 AD.2d 423, 424 (1st Dept. 1999) C'the indictment together with the People's response to defendant's omnibus motion and discovery material provided to defendant gave adequate notice of the charges against her and the prosecution was not required to include evidentiary material in a bill of particulars"), Iv denied 93 NY2d 1021(1999); People u: Fi~erald, 45 N.Y.2d 574 (1978) (manner in which defendants committed crime evidentiary beyond scope of bill); People v. Young; 262 AD.2d 8 (1 st Dept. 1999) (evidence which establishes intent to sell controlled substance when charge is possession with intent to sell not required in bill of particulars as evidentiary in nature); People v. Choi, 259 AD.2d 423, 424 (1st Dept. 1999) (people not required to provide evidentiary matters in bill of particulars); Purple v. Byrnes, 126 AD.2d 735 (2d Dept. 1987) (bill of particulars need only specify substance of defendants conduct, not evidence); People u:

Smith, 103 A.D.2d 859 (3d Dept. 1984) (nature of defendants participation in sale of narcotics and specific details of sales are evidentiary beyond scope of a bill of particulars). In the instant case, the defendants know the exact substance of the charges and have had access

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to much mote information than is required by statute. Their motion for further particulars

is simply a request for discovery of purely evidentiary matters in the guise of a request for a

Bill of Particulars and should be denied.

A. The Request for the Identity of Witnesses Should Be Denied

The defendants seek disclosure of the identity of Mayor Bloomberg's "Agents" and

other campaign, government officials or other representatives of Mayor Bloomberg. (De£

AfE at 7-11 ~12(E), (I), (L), (M». The defendants' request should be denied. The identity of

witnesses is purely evidentiary material that is not part of a bill of particulars and relates to

"evidence that will be usee). to prove" the People's theory at trial. See Preiser, Practice

Commentaries, McKinney's Cons Laws of NY, Book l1A, c.P.L. § 200.95, at 539-40

(defendant not entitled in a bill of particula:t:s to evidence that will be used to prove the

prosecution theory at trial); People u: Contento, 146 A.D.2d 959, 961 (3d Dept. 1989) (names of

witnesses not properly in a demand for bill of particulars); People P. Gmn, 83 Misc.2d 583 (Cr.

Ct, N.Y. Co. 1975) (names of witnesses are stricdy evidentiary material not authorized under

bill of particulars); People u. Keohane, 201 Misc. 597, 601-602, 115 N.YS.2d 492,497-498 (N.y.

Gen. Sess. 1951) (denying motion for bill of particulars to identify "high official in the Fire

Department" referred to in indictment charging conspiracy and extortion).

B. The People Are Not Required to Disclose the Other Crime In Regard to the Charges of Falsifying Business Records

The defendants request «the nature of the other crime they intended to commit" in

connection with falsifying business records. (Def. Aff. at 11 ~12(DD). Their request is

meritless and should be denied A person commits the crime of Falsifying Business Records in

the First Degree when he makes or causes a false entry in the business records of an enterprise

with intent to defraud, including an intent to commit another crime or to aid or conceal the

commission thereof. See P.L. §§ 175.10, 175.05(1). The Penal Law defines "business record" as

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"any writing or article, including computer data or a computer program kept or maintained by an enterprise for the purpose of evidencing or reflecting its condition or activity." See P.L. §

175.00(2).

In general, where an element of the crime contains an "intent to commit" another crime, or aid or conceal the commission thereof, there is no burden on the People to establish the particular crime the defendant intended to commit People v. Mackq, 49 N.Y 2d 274 (1980). Nor must the intended crime be actually committed Id. In Mackq, the defendant was indicted for burglary in the second degree, which charged that he knowlngly entered and remained in a dwelling with "intent to commit a crime therein." .Following his arrest, defendant demanded a bill of particulars specifically identifyjng the crime defendant intended to commit within the dwelling. The Court of Appeals held that the element of "intent to commit a crime" meant any crime and that it was not a requirement of proof for the People to identify the intended crime or prove that it actually occurred. Id at 279. The Court explained that the reason for this rule is "pragmatic", because "intent is subjective, and must be established by proof of defendant's conduct and other facts and circumstances." Id To require the People to prove an intent to commit a particular crime would tum the trial into an exercise of "hairsplitting", which the legislature sought to avoid, noting that had the legislature intended the People to prove a particular crime, the statute could have read «specified" or by adding "particular" between "a" and "crime". Id Because the Falsification of Business Records in the First Degree element of intent is exactly identical to that element in the Burglary statute, it is clear that, especially for the purposes of a bill of particulars, the People need not specify any particular crime. See PL. §§ 140.25 and 175.10.

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POINT FIVE

THE GRAND JURY MINUTES

SHOULD NOT BE RELEASED TO DEFENDANTS

Defendants not only move the Court for judicial review of the Grand Jury minutes,

but also request that those minutes be released to the defendants. (Def. Aff. at 11-16 ~~ 13-

25). Although the People have provided the Grand Jury minutes and Grand Jury exhibits

for the Court's inspection, we oppose any release of the minutes, including instructions, to

the defendants.

Section 210.30(1) of the Criminal Procedure Law, which provides for the inspection of

grand jury minutes, clearly provides for inspection by the defendants only (1) after the court has

examined the minutes; and (2) the court has determined that release of those minutes is

necessary to assist the court in its determination of the motion. Even then, the grand jury

minutes are not to be turned over to defendant in their entirety, but rather they are to be limited

to that portion "which is relevant to a determination ofwhether the evidence before the grand

jury was legally sufficient to support a charge or charges contained in such indictment." c.P.L.

210.30(1).

Release of Grand Jury minutes to a defendant is the exception rather than the rule.

Contrary to defendants' position, it is in the public's interest to maintain the secrecy of the

Grand Jury minutes, not to disclose them, Matter of District Attornry 0/ 5,qfolk Coun!_y 58

N.Y.2d 436 (1983). The Court of Appeals has noted "secrecy has been an integral feature of

grand jury proceedings since well before the founding of out Nation. The reasons for this

venerable and important policy include preserving the reputations of those being

investigated by and appearing before a Grand Jury, safeguarding the independence of the

Grand Jury, preventing the flight of the accused, and encouraging free disclosure of

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information by witnesses. Although the rule of secrecy is not absolute; a presumption of

confidentiality attaches to the record of Grand Jury proceedings. The presumption can be

overcome only by a defendant's demonstration of a compelling and particularized need for

access to the Grand Jury material. If a defendant meets that initial burden. the trial court

must then balance the public interest for disclosure against the public interest favoring

secrecy. Where the former outweighs the latter, the trial court may exercise its discretion to

direct disclosure." People ti: Fetcho, 91 N.Y.2d 765, 769 (1998) (internal citations omitted).

The defendants suggest that the Grand Jury might not have been properly instructed on

the law as a reason to disclose the minutes to the defendants. (Def Aff. at t 6 ~ 25). This claim

is without merit At the outset, c.P.L. 210.30(3) provides that " ... release shall be limited to

that grand jury testimony which is relevant to a determination of whether the evidence before

the grand jury was legally sufficient," and not the legal instructions given to the jury. This is not

surprising, as the Court is certainly able to make that assessment without the aid of the

defendants. The Court's in camera examination of the minutes will show that the grand jury

proceedings were proper and sufficient and that the Grand Jury was properly instructed on

general principles of law and specific legal definitions. (GJ Min. at 441472).4

The defendants bear the burden to demonstrate a specific need that would overcome

the strong statutory presumption against disclosure. Phrased somewhat diffetently, the issue is

not whether the People can make ail argument why defendants should not receive the minutes,

but whether defendants have overcome the statutory injunction against disclosure of the

4 Even assuming for the sake of argument some technical deficiency in the Grand Jury instruction, dismissal would still not be necessarily warranted. Instructions to the Grand Jury need be neither as specific not comprehensive as those to a petit jury. P~r;plu v. Darlry, 75 NY2d 449,454 (1990); Pu()pk II. Valles, 62 N.Y.2d 36, 38 (1984); People»: Calbud, 49 NY2d 389, 394 (1980). In most cases, the required standard is met by simply reading the appropriate Penal Law sections to the grand fury. S~e People u. Calbud, 49 N.Y.2d at 395.

17

minutes except in extraordinary circumstances. Defendants have failed to make the necessary

showing and their motion for release of the Grand Jury minutes should therefore be denied.

POINT SIX

DEFENDANTS' REQUEST FOR OPPORTUNITY

TO MOVE TO REQUEST FOR FUTURE SUPPRESSION HEARING

The People do not object to the defendants' request to make a future motion

regarding physical evidence seized. (DeE. Af£. m126-28). \Xi'hile the defendants request an

«itemized list" of the seized property (DeE. AfE. , 27), the People have already provided

defendants with lists of items seized pursuant to search warrants. The defendants' attorney

has also viewed recovered property.

POINT SEVEN

DEFENDANTS' REQUEST FORALFINITO/FRANKSHEARING

The People do not object to the defendants' reservation of rights to bring a motion

to challenge the search warrants. Nevertheless, the defendants do state that upon their

"information and belief" the warrant authorizing the seizure was improperly issued in that it

was not supported by probable cause. (Def. Aff. 'iI 29).

While this will be addressed in the future, examination of the warrants and affidavits,

which will be provided for the Court's review, belies that claim. The warrant application

provides reliable facts and circumstances that are collectively of such weight and

persuasiveness as to convince a prudent person that it was reasonably likely that the evidence

sought would be found at the designated location. See c.P.L. §§ 690.35(3), 70.10(2).

Furthermore, as stated previously, since the filing of their Notice of Motion and

Affirmation, defendants have been provided with the search warrants and supporting

affidavits.

18

POINT EIGHT: IN RESPQNSE TO DEFENDANTS' ARGUMENTS 8 & 9

GRAND LARCENY IN THE FIRST DEGREE SHOULD NOT BE DISMISSED OR REDUCED

The defendants seek dismissal of the charge of Grand Larceny in the First Degree on

the grounds that the evidence before the Grand Jury was legally insufficient and the

defendants' conduct, as presented, could not support any cognizable theory of larceny. (Def.

AfE. ~~ 32-38). Alternatively, the defendants seek to reduce the charge to Grand Larceny in

the Second Degree, claiming, in essence, that they should only be charged with the amount

that Haggerty personally "obtained" as opposed to the amount that was wrongly taken from

Bloomberg by false pretenses. (DeE. Af£. ~~ 39-40).

The defendants' motion must fail on numerous grounds. His specific arguments,

which are addressed below, cannot and do not refute the basic point: this is a simple and

straightforward larceny by false pretenses amply supported by the evidence before the Grand

Jury. Haggerty presented Mayor Bloomberg and his staff with material misstatements of fact

to induce them to part with more than one million dollars. These misstatements of fact -

Haggerty's lies - misrepresented both what he had already done to set up the Operation, and

what he would do on Election Day. Haggerty set up a shell company to hide the

transactions from scrutiny and to disguise the transactions, hallmarks of larceny and money

laundering. \X'hen he was later asked about it by Mayor Bloomberg's staff, he not only lied,

he also created false documents to back up the lies, and importuned others to lie on his

behalf. Despite the efforts of the defendants to obscure this record with arcane and

inapplicable legal theories, nothing can detract from what is essentially a simple case of theft.

The defendant's general theory of dismissal rests not on the evidence actually

presented to the Grand Jury, but rather on the novel basis of «information and belief' that

"relevant admissible evidence ... should have been presented to the Grand Jury." (Def. Aff.

19

1111 32, 40). In essence, the defendants proffer a series of unsworn, unattributed and

unauthenticated allegations, which, they claim, would demonstrate the defendants'

incontrovertible innocence.

As a prime example, defendants insist that the evidence before the Grand Jury

"should" have included testimony that "Mr. Haggerty worked 5-6 days per week, 14 hours

per day, from late August through mid-November on ballot security," (De£. Aff. 11 32a). It

is nowhere suggested in the moving papers who could have given such testimony, truthful or

not, to the Grand Jury except for presumably Haggerty, himself.5 But Haggerty nowhere

provides legal authority that would permit him to now put before the Court alternate

theories or facts and ask the Court to speculate and, in essence, credit these facts over the

sworn testimony actually presented to the Grand Jury. As stated, the evidence presented to

the Grand Jury presented a clear and overwhelming portrait of defendant's lies and

misrepresentations, and his scheme to take wrongly funds from Mayor Bloomberg.

A The Legal Standard

The only question before this Court on a motion to dismiss or reduce particular

charges is whether the evidence actualfy presented to the Grand Jury was sufficient to sustain

those criminal charges, not whether an unsupported argument "on information and belief'

might lead to a different result. Thus, the scenarios posited on "information and belief' in

the defendants' moving papers at paragraphs 32 and 40 must be ignored. This Court's legal

analysis must begin and end only with the evidence actually adduced before the Grand Jury,

;The defendants proffer a similar argument that in August 2009, one of Bloomberg's aides, Kevin Sheekey, proposed that defendant Haggerty provide ballot security under the auspices of the NYSIP; and that it was Sheekey who pointed to earlier budgets as demonstrating the type of ballot security effort that Sheekey thought should be carried out (Def. Aff 11 32a, 32d). The import of this argument is far from clear. It could demonstrate that Sheekey expected a robust ballot security operation and placed before Haggerty - a knowledgeable and seasoned political operative - the type of operation Sbeekey expected. None of this has bearing on the gravamen of the crime - that Haggerty misled Sheekeyand others by lying about the Operation Haggerty claimed to have put together both before and after receiving the stolen funds from Mayor Bloomberg.

20

as "[w]hen assessing the legal sufficiency of an indictment the court must limit its examination of the evidence to that which was presented to the grand jury." People v Corliss,

51 A.D.3d 79, 83 (1st Dept. 2008), citing People 11 Garson, 6 NY3d 604, 613 (2006). Any reasonable analysis of the evidence before the Grand Jury requires the charge of Grand Larceny in the First Degree to be sustained. The pure legal question is whether under c.p L. § 70.10(1), the evidence was "legally sufficient." For that review of a Grand Jury's action, "'legally sufficient evidence' means competent evidence which,· if accepted as true, would establish every element of the crime charged and the defendant's commission of it." People v. Manini, 79 N.Y.2d 561, 568, (1992), citing People u: Hanry, 30 N.Y.2d 328, 335~336 (1972). Significantly, in determining whether Grand Jury evidence is legally sufficient, the Court simply reviews the evidence heard by the Grand Jury and then considers «whether the evidence, viewed in the light most favorable to the People, if unexplained and uncontradicted, would be sufficient to warrant conviction by a petit jury." People v. Jennings, 69 N.Y.2d 103, 114 (1986); People 11. Pelchat, 62 N.Y.2d 97, 105 (1984). The Court does not consider the weight or quality of the evidence; such questions should be deferred until trial See People v. Swamp, 84 N.Y.2d 725, 730 (1995).

In considering the adequacy of the evidence, every reliable inference that can be drawn from the evidence must also be applied in support of the indictment returned. Sec Swamp, 84 N.Y.2d at 730; People u: Bello, 92 N.Y.2d 523 (1998). The possibility that alternative conclusions may be drawn from the facts is irrelevant "as long as the Grand Jury could rationally have drawn the guilty inference." People u: Deegan, 69 N.Y.2d 976, 979 (1987). Indeed, even if innocent inferences can be drawn from the defendants' actions, the charge must be upheld as long as the grand jury could rationally have drawn a guilty inference. Pecple v. Deegan, 69 N.Y.2d at 978,979 (1987); People.« DiaiJ 209 AD2d 1,6 (1st Dept. 1995).

21

B. The Evidence Clearly Established Grand Larceny By False Pretenses

To establish Grand Larceny in the First Degree, the evidence before the Grand Jury

simply had to establish that the defendants intended to deprive the victim of more than $1

million, or to appropriate that money to themselves or a third person, and that they

wrongfully took, obtained, or withheld that money from the victim. P.L. §§ 155.05; 155.42.

Larceny by false pretenses is an eighteenth century statutory creation codified in Penal Law

§155.05(2)(a). Peqple v. N017J1a11, 85 N.y'2d 609, 618 (1995); People v. ChurchiU, 47 N.Y.2d 151,

155 (1979). That section provides:

. Larceny includes a wrongful taking, obtaining or withholding of another's property, with the intent prescribed in subdivision one of this section, committed in any of the following ways:

a) By conduct heretofore defined or known as common law larceny by trespassory taking, common law larceny by trick, embezzlement, or obtaining property by false pretenses.

To establish larceny by false pretenses, the People must prove "that defendant obtained

tide or possession to money or personal property of another by means of an intentional false

statement concerning a material fact upon which the victim relied in parting with the property."

Peqple v. Drake, 61 N.Y.2d 359,362 (1984). The elements of larceny by false pretenses are (1) an

intent to deprive an ownet of property, (2) through the making of a false representation with

knowledge of the falsity, (3) that the owner of the property relies on in parting with the

property~ Peqple v. Chaffin, 94 A.D.2d 705, 706 (2d Dept. 1983), 4!d 61 N.Y.2d 683 (1984);

Peqple v Srymour, 55 A.D.2d 737 (3d Dept. 1976).

The evidence before the Grand Jury established that Haggerty did just that by using

false representations in connection with a scheme to provide ballot security. As the Grand

Jury evidence showed, on October 27,2009, after previously having been recruited to create

a ballot security operation, Haggerty presented top aides to Mayor Bloomberg his false

22

budget and plan for "Election Day/Ballot Security Operation," which was to be funded by Mayor Bloomberg. (GJ Min. at 206-207). The ambitious plan claimed to involve 1355 paid poll watchers, one at each polling site, as well as 400 poll watchers and 200 hundred drivers assigned as teams to rove between polling sites. (GJ Min. at 172-173; GJ Exh. 17). Haggerty presented a budget that listed the costs on Election Day as totaling over $750,000, and the costs leading up to Election Day as totaling $310,000. (GJ Exhs. 17 and 20).

In the email by which he transmitted the plan and budget, Haggerty specifically represented that "[t1his project was started several weeks ago and many of the contracts were signed then and the invoices are now due so we need to do this as quickly as possible." (GJ Min. at 211-212; GJ Exh. 19). He further stated that because of the outstanding obligations and the need to fund the operation for the upcoming election, the "money needs to be wired as soon as possible" to the housekeeping account of the NYSIP. (GJ Min. at 211, GJ Exh. 19). As the Grand Jury evidence further showed, these representations were wholly false. There were no contracts or invoices which had to be paid, or indeed were ever paid, except for de minimis amounts. (GJ Min. at 327).

It was likewise established before the Grand Jurj that on October 28, 2009, the day after defendant Haggerty sent the email to top aides to Mayor Bloomberg, Haggerty met with them, as well as with Mayor Bloomberg himself, to discuss his ballot security operation and that, in reliance upon defendant Haggerty's representations, the funding was approved. (GJ Min. at 214-216,227,230).

Two days after Haggerty's continued deceptions on October 28, on October 30, 2009, he met again with aides to Mayor Bloomberg. Those aides were to evaluate the reasonableness of the costs of the ballot security operation, and if the costs, based upon the plan and budget, were reasonable, to facilitate the transfer of the funds. (GJ Min. at 168).

23 .

At that meeting Haggerty provided them with the same description of the Election Day

Operation and proposed written budget that he had provided previously to another aide to

the mayor. (GJ Min. at 166-167, 234-236). During the meeting Haggerty made further

representations about the ballot security operation. Indeed, Haggerty told them that most of

the expenses listed in the budget "had already been paid or incurred." (GJ Min. at 169, 177-

178).6 As noted above, this was false.

Three witnesses testified before the Grand Jury who had authority to direct money

transfers from Mayor Bloomberg's personal account on Mayor Bloomberg's account (GJ

Min. at 318-319): Grand Jury Witness #1 (GJ Min, at 186-187), Grand Jury Witness #2 (GJ

Min. at 186, 234), and Grand Jury Witness #3 (GJ Min, at 187). Based on Haggerty's

misrepresentations, they transferred $600,000 to the NYSIP Housekeeping Account on

October 30,2009 (GJ Min, at 187-188), and then transferred a second payment of $600,000

on November 2,2009. (GJ Min. at 189). In conveying the instructions to make the money

transfers, Grand Jury Witness #2 relied on Haggerty's statement of the costs already

incurred and to be incurred in the Operation. (GJ Min. at 241). This is sufficient to prove

reliance. See, People v. Termotto, 81 N.Y.2d 1008, 1009-1010 (1993)(sufficient to prove reliance by

showing that agent induced by false pretense, as there is no requirement that reliance by a

business entity be established through the testimony of the ultimate decision-maker). Indeed,

6The defendants appear to assert that it would have been wrong for employees of New York City to represent Mayor Bloomberg using New York City resources, or during working hours as a New Yotk City employee, and further assert that Haggerty "would have no reason to believe" that such persons represented Mayor Bloomberg in a personal capacity (DeE Aff. '11 32e, 32f). First, it gains the defendants nothing even were it true that people improperly acted on behalf of Mayor Bloomberg personally during working hOULS. Second, the Grand JUI}' heard no evidence of what Haggerty had "reason to believe," nor is it clear from whom such testimony might have come. The defendants, at the Grand JUI}' stage are not entitled to inferences flowing from the Grand J my evidence, only the People are. See People u: Jennings, 69 N Y.2d 103, 114 (1986); People v. Deegan, 69 N.Y.2d 976, 979, (1987). Likewise irrelevant is the defendants' effort to suggest some novel view of agency principles as a means of defeating the proof before the Grand Jury (Def. Aff. ~ 32g). The issue is whether Haggerty, by his false representations, intended to deprive his victim of money, whether his victim relied upon the false representations however ultimately conveyed, and whether the victim was deprived of the money . .All were answered affirmatively in the Grand Jury.

24

the evidence was clearly sufficient to prove the element of reliance as lithe fact that the property was obtained by false pretenses necessarily implies that the owner of the property relied upon those pretenses." People v. Sattlekau, 120 App.Div 42, 49 (1st Dept 1907).

Moreover, although there is no requirement that the evidence establish a criminal defendant's motive, the evidence presented to this Grand Jury did so. Haggerty needed the funds to purchase his deceased father's home, something he had been negotiating for about a year. (GJ Min. at 292-293). About a month after the election, on December 11, 2009, when he needed the money to close on that house, Haggerty instructed the NYSIP to send .$750,000 from the Housekeeping Account to an account he had estab~shed in the name of SEO. (GJ Min. at 359-365, 370, 372, 377). Four days later Haggerty used $546,545.97 of those funds for the closing, and kept the rest. (GJ Min, at 315-317; GJ Exhs. 4 and 23).

Evidence of Haggerty's intent to deceive Mayor Bloomberg and his agents was further manifested in February 2010 when Haggerty embarked on an effort to cover-up his crimes. On February 1,2010, in an email, Haggerty falsely stated that the $750,000 had been used to pay the outstanding ballot security invoices, and any remaining funds had been returned to the NYSIP. (GJ Min. at 100-102; GJ Exh. 9). He also stated that the Operation had included 300 poll watchers each assigned toone poll site for the entire day, and an additional 500 additional poll sites covered by roving poll watchers or lawyers retained for that purpose. (!d.).

Indeed, by no later than November 2, 2009, when the second of the two wire transfers of $600,000 were sent to the Housekeeping Account, Mayor Bloomberg was permanently deprived of over $1 million through the defendants' false representations. Given the reliance of Mayor Bloomberg and his staff on Haggerty's false representations, it

25

is difficult to see how the defendants can claim that the evidence before the Grand Jury would be insufficient to support the Grand Larceny in the First Degree charge.

Finally> the defendants also argue that Mayor Bloomberg and his aides cannot claim deception because the mere fact that items were listed in the Operation budget did not necessarily mean that those expenditures would take place. (Def. Af£. 'V 37). This argument misses the point. The facts adduced before the Grand Jury demonstrate that the budget for the ballot security operation Haggerty presented to the Campaign was sheer fantasy. Haggerty simply deceived Mayor Bloomberg and his aides into believing that over $1 million of the Mayor's money would be used to pay for a ballot security operation.

C. The "Political Donation" Argument

The defendants also argue that the transfer of funds from Mayor Bloomberg to the NYSIP was some sort of general political donation and, as such, it could be used for any purpose deemed appropriate by the NYSIP. (Def. Aff. mI 35 - 37). This argument seeks to mischatacterize the nature of the transferred funds and thus, presumably, make them the lawful property of the NYSIP to do with what they would. Of course, this argument again ignores the actual evidence adduced before the Grand Jury, which makes clear that Haggerty deceived Bloomberg and his staff into sending the money to pay for a fictitious ballot security operation as part of his larcenous scheme;

D. Defendants' Arguments Relating to Civil Fraud Are Inapposite

Another argument presented by the defendants is not grounded in precedent involving Penal Law larceny jurisprudence or even tn principles of criminal law at all. Rather, the defendants cite civil fraud cases and attempt to apply civil law principles to this criminal proceeding. The defendants thus argue that the victim's reliance upon the

26

intentional deceptions of the defendants must somehow be gauged by a special standard of

reasonableness.

'Ibis argument was raised and expressly rejected in People v. Collins, 273 A.D.2d 802

(4th Dept. 2000). As the Fourth Department wrote in Collin!:

We reject defendant's contention that, because of the contingent nature of the promise, the victim could not reasonably have relied on it. The concept of reasonable reliance is not found in the larceny statute .... There likewise is no merit to defendant's contention that, because a promise to matry is unenforceable as a matter of contract law, it cannot serve as the predicate for a prosecution for larceny by false promise.

273 A.D.2d at 803.

Here, the fact that the Bloomberg campaign <c ••• did not check to confirm the accuracy" of

Haggerty's representation "does not evince a lack of reliance. On the contrary, it evinces

total, albeit misplaced, reliance on defendant's honesty." See, People v. DiCarlo, 293 AD.2d

279,280 (1st Dept. 2002).

This, of course, makes perfect sense. The criminal law generally looks at the

misconduct of the perpetrator and whether it is conduct that society should condemn.

Deceiving others to part with property is conduct that society has decided to condemn in

enacting larceny laws. As noted by the Fourth Department, the civil concept of "reasonable

reliance" is not found in the larceny statute; or indeed, anywhere in the Penal Law. See

Co/lins, 273 AD.2d at 802. 'Ibis argument is misinformed and should be rejected.

The two cases cited by the defendants do nothing to support their view. In Demo»,

Moms, Levin & Shein v. Glant':(; 53 N.Y.2d 553 (1981), the Court of Appeals held only that an

attorney did not have a cause of action against a former client for fraudulently inducing the

attorney to enter into a retainer agreement. The Court held that its decision flowed from a

public policy rationale that enabled a client to terminate an attorney-client relationship at any

time. Notably, the Court observed, it was not denying all recovery to the deceived attorney.

27

The attorney would still be able to recover, by civil lawsuit, for the "reasonable value of services rendered." 53 N.Y.2d at 558. In rendering its decision it is apparent that the Court of Appeals was not announcing a broad rule that would apply to anything other than the limited is sue before the Court in that civil matter.

The other civil case cited by the defendants is equally inapplicable to the issues presented in the instant matter. That case, TannehiO v. Paul Stuart, Inc., 226 A.D.2d 117, (1st Dept. 1996), simply involved a plaintiff who claimed that she was fraudulently induced to leave other employment in order to be hired by the defendant company. The First Department concluded that there was no reason to graft a theory of fraud to its analysis. Rather, if there were recovery at all, it would rest on theories of contract law, specifically that the civil defendant had never intended to abide by the promises made to the plaintiff. Thus, the court recognized that in the civil matter before it, the victim of deception had a civil cause of action that would permit her to avoid the losses incurred by the defendant's deceptive business practice, and it was unnecessary to graft a civil fraud theory to redress the wrong.

Thus, neither case leads to the broad general theory of criminal jurisprudence propounded by the defendants. An individual who uses fraud and deceit to induce another person to give them property runs afoul of New York State's larceny prohibitions. The Penal Law, simply put, does not permit people to do what Haggerty did without being subject to criminal sanction.

E. The Value of the Property Stolen Exceeds $1 Million

Finally, the defendants' argue that even if there was a larceny, its value would be less than $1 million. Citing People v. Sanchez; 195 AD.2d 578 (2d Dept. 1993), aff'd, 84 N.Y.2d 440 (1994), they argue that the Grand Jury "should" have heard evidence that would have

28

required the jurors to conclude somehow that the defendants provided at least $76,000 in actual services, thus rendering any amount stolen necessarily less than $1 million. But Sanchez stands merely for the unsurprising proposition that to obtain a conviction of a criminal defendant for Grand Larceny in the Second Degree, the proof must show the value of the property to be in excess of $50,000.

As discussed above, the evidence before the Grand Jury established that Mayor Bloomberg was induced to transfer $1.2 million to the NYSIP, only $100,000 of which was a political contribution. Thus, it is the remaining $1.1 million that forms the corpus of the charged larceny because those funds were transferred as a result of and in reliance on the false representations by Haggerty, again, that contracts were in place, expenses had been incurred, and that approximately $1,076,750 would be spent on ballot security. The evidence before the Grand J my was that about $32,000 was actually expended on anything related to an Election Day operation. (GJ Min. at 327). Even crediting defendants for this amount, the Grand Jury was clearly entitled to conclude that Mayor Bloomberg was deprived of over $1 million.

Even assuming that the defendants are correct and over $76,000 in ballot security expenses were actually incurred, that is irrelevant. The defendants again mistakenly apply a civil standard - the offset of damages - to a criminal proceeding. Having obtained the sum of $1.1 million by false pretenses (conceding for the sake of argument the other $100,000 that was sent along as a donation to the Independence Party was not wrongfully taken) no rule allows the defendants to "mitigate" or "offset" the value of the larceny by arguing that certain expenditures really did occur. The entire $1.1 was obtained only because of the false pretenses proffered by Haggerty. At the time the funds were transferred to the NYSIP, the larceny was complete. See People v. MacDonald, 215 AD.2d 504 (2d Dept. 1995) (defendant

29

who stole by money obtained through false Medicaid billings was not entitled to "offset" based upon value of services he provided). The proper measure for purposes of larceny is the difference between the value of the property given in reliance on the defendants' lies and the value the victim would have given had the defendant been truthful. Peqple v. Zimberg, 253 A.D.2d 381 (1st Dept. 1998); People v. Ponnopula, 266 A.D.2d 32 (1st Dept. 1999)(taking by false pretense in excess of threshold amount sufficient to establish larceny, notwithstanding fact that victim's ultimate loss was less than that sum). Here, the answer to that question is simple: no money would have been wired to the NYSIP (perhaps other than the $100,00 contribution) had Haggerty truthfully represented that he had no intention of incurring expenses of more than $1 million and was simply trying to raise money to purchase real estate that he coveted.

*

*

*

*

The evidence presented to the Grand Jury plainly supports the degree of crime charged. The evidence demonstrated that the defendant made direct and unambiguous factual representations that were patently false. The victim and his staff relied upon those representations and sent money - in excess of $1 million - to an account from which money was ultimately sent to the defendants. Haggerty used that money for his own personal purposes and not for the purposes he represented to the victim. It is a simple and straightforward larceny case, and the evidence clearly supports the crime charged.

POINT NINE

THE MONEY LAUNDERING COUNT SHOULD NOT BE DISMISSED

The defendants move to dismiss the Second Count of the Indictment charging Money Laundering in the Second Degree, arguing that "there is no evidence of any concealment or attempted concealment of criminal conduct." (Def Aff. at 25 mI 42-46).

30

The defendants ate wrong. The Grand Jury was presented with overwhelming evidence that the defendants engaged in financial transactions that both concealed and disguised and attempted to conceal and disguise the source, ownership, and control of the proceeds of their theft. The defendants' motion should be denied.

A The Legal Standard

A person is guilty of Money Laundering in the Second Degree in violation of Penal Law"il 470.15(1)(b)(ii)(A)(iii) when (1) knowing that the property involved in one or more financial transactions represented (2) the proceeds of specified criminal conduct, (3) he or she co~ducted one or more such financial transactions which in fact involved the proceeds of specified criminal conduct (4) knowing that the transaction and transactions in whole or in part were (5) designed to conceal and disguise the nature, the location, the source, the ownership and the control of the proceeds of specified criminal conduct, and (6) the total value of the property involved in such financial transaction and transactions exceeded one hundred thousand dollars.

B. Haggerty Used SE~ to Conceal Payments From NYSIP

Judged by this standard, the evidence that the transactions were designed to conceal was more than sufficient Haggerty concealed from Mayor Bloomberg's agents, employees and campaign workers the fact that he would get paid and the amount he would receive for his work on the Operation. On or about October 15, 2009, as part o(his plan to conceal his theft, he entered into a sham agreement with the NYSIP that, among other things, called for the NYSIP to pay Haggerty and SEO up to $1.1 million for development of a plan for the Operation. The Grand Jury testimony is clear that no one involved in the Campaign had any knowledge of this contract, SEO, or any arrangement that Haggerty had with the NYSIP for payment for work on the Operation. (GJ Min. at 151-152, 215-216, 228,243).

31

In reality, SEO was a shell corporation solely used as a vehicle by Haggerty to

secretly pass cash from the NYSIP to himself. SEO had no office, received no mail, and did

no business at the location listed as its address. In fact, the real occupants at that address did

not even remember that SE~ was listed at that location. (GJ Min. at 197). Moreover, SE~

was not even incorporated until December 3, 2009, well after the election, emphasizing its

use solely as a pass-through entity designed to conceal that Haggerty was really receiving the

payments for his own use.

When press inquiries were made to the Campaign inJanuary 2010. concerning SEO/

Haggerty continued to attempt to deceive the Campaign by representing that SE~ had

actually paid poll watchers as part of the Election Day Operation. Haggerty went so far as

to provide the Campaign with three bogus SE~ checks that he falsely claimed were

payments made to poll watchers. (GJ Min. at 109-115; GJ Exh. 11).

"Money laundering is the process by which criminals attempt to transform their ill-

gotten gains into what appears to be lawfully-gained wealth." (Donnino, Practice

Commentary, McKinney's Cons Laws of NY, Book 39, PL'il 470.00, p. 213). Haggerty had

at all times represented to the Campaign that he was a volunteer, working for no payment.

Haggerty created and used SE~ to conceal the fact that he ended up with the stolen money,

a classic money laundering scheme.

POINT TEN

FALSIFYING BUSINESS RECORDS SHOULD NOT BE DISMISSED

Defendants move for dismissal of counts Three, Four and Five because they claim

that the bogus checks "are not 'business records." (Def. Aff. at 25 'il47). The defendants'

7 In its January 15, 2010 public filing, the NYSIP had listed SE~ as having received a payment of $750,000, apparently triggering press inquiries concerning the nature of SE~ and why it had received that money.

32

argument is meritless. The checks were records kept and maintained by the Campaign for the purpose of evidencing and reflecting its condition and activity. See PL. § 175.00(2). Defendants' motion should be denied.

A person conunits the crime of Falsifying Business Records in the First Degree when he makes or causes a false entry in the business records of an enterprise with intent to defraud, including an intent to commit another crime or to aid or conceal the commission thereof P L §§ 175.10, 175.05(1). The Penal Law defines "business record" as "any writing or article, including computer data or a computer program kept or maintained by an enterprise for the putpose of evidencing or te£lecting its condition or activity," P.L § 175.00(2).

In the instant case, it is undisputed the written instruments in question, SEQ bus.iness checks created and purportedly cashed in consideration of services tendered, are "business records" within the statutory definition contained within P.L § 175.00(2). It is equally undisputed that the Campaign, is an «enterprise" within the meaning of PL. § 175.00(1), which is defined as «any entity of one or more persons, corporate or otherwise, public or private, engaged in bus.iness, commercial, professional, .industrial, eleemosynary, social, political or governmental activity."

Moreover, Article 175 is broad in scope. See People o. Bloomfield, 6 N.Y.3d 165, 170 (2006). In enacting this statute, the Legislature intended to broaden the application of various earlier narrowly-drawn provisions. Indeed, the Staff Notes stress that the new crime of falsifying business records «embraces and somewhat expands offenses" defined by the former Penal Law. See NYS Commission on Revision of the Penal Law and Criminal Code, Staff Notes."

8 These Staff Notes can be found in Volume 23B of the New York Consolidated Laws Service at page 323.

33

As the First Department noted in People u: Marasa, 32 A.D.3d 369, 370 (1st Dept.

2006), the Court of Appeals has expressly rejected earlier narrow definitions of the term

'business record: See e.g. People 11. Bloomfield, sttpra (letters discussing the ownership of a

company are part of its business records); People tI. Coe, 71 N.Y.2d 852 (1988)(patienfs

medical chart is a hospital business record); see People u: Marasa, supra (consulting agreements

qualify as business records);') People 11 Roth, 176 AD.2d 1186, 1188 (4th Dept. 1991)(same for

shipping documents). Indeed, the target of the intended fraud may be either the enterprise

keeping the business records in question, or any third person; a defendant also violates the

statute when he possesses an intent to deprive another of any other risht, or in any way to

impede legitimate governmental action. See People v. Schrag, 147 Misc.2d 517, 518,-19 (Rockland

Co. Ct. 1990)Jollowing People 11. Coe 131 Misc.2d 807 (N.Y. Co. Sup. Ct. 1986), qfjirmed, 71 NY.2d 852 (1988);10 see also People v. DR Blair & Co, 2002 NY. Slip Op. 50152U, 2002 N.Y. Misc.

Lexis 317 (holding that the "the reach of the statute includes the falsification of records

which are designed to thwart possible regulatory scrutiny").

Testimony in the Grand Jury was clear that the SED checks charged in counts

Three, Four and Five were business records specifically used by the Campaign to reflect

payments that were supposedly made to poll watchers as part of the Operation. (GJ Min. at

107-109; GJ Exh. 10). The testimony is also equally clear that the checks were bogus, that

the individuals represented by Haggerty to be poll watchers did not in fact get paid, and that

9 Notably, in Manua, the First Department reversed course as to its own earlier decision in People u. Schwarli; 21 AD.3d 304 (1st Dept. 2005), in which it had held that consulting agreements could not qualify as business records.

10 Schrag explicitly noted that "[w]bile several Penal Law fraud statutes are directed specifically to preventing property or pecuniary loss, the fraud crimes in Article 175 of the Penal Law are not so delimited and therefore the 'intent to defraud' terminology must be .interpreted so as to effectuate their object, spirit and intent." 147 Misc.Zd at 518. .

34

two of those individuals never even received those checks. (GJ Min. at 248-253, 268-271,

275-280; GJ Exh. 15). Moreover, Haggerty provided the SEO checks to the Campaign

knowing that it would use the checks as evidence that supposedly legitimate payments were

made in connection with the Operation, and, importantly, to rebut the notion that the

Campaign used the NYSIP and SEO as vehicles to make illegal payments to Haggerty. (GJ

Min. at 107-109; GJ Em. 10). Once Haggerty sent the bogus checks to the campaign staff,

they became business records of the Campaign and were maintained to reflect and

demonstrate that the campaign did not engage in unethical or illegal conduct during the

campaign. Defendants' motion should be denied.

POINT ELEVEN

THE INDICTMENT SHOULD

NOT BE DISMISSED IN FURTHERANCE OF JUSTICE

Pursuant to c.P.L. § 210.40, the defendants seek dismissal of the indictment in the

interest of justice. Primarily. the defendants seem to claim that: (1) the alleged crimes had no

effect on the victim." (2) Haggerty has spent most of his professional life working for

government of:fi.cials; and (3) a felony conviction would prevent Haggerty from continuing to

work in the public secror," (Def. Aff. at 30 ~ 58(1); 34 ~58(3); 35 ~58(4)). Defendants' claim is

meritless and the motion should be summarily denied.

11 Defendants mistakenly identify the victim as "Bloomberg for Mayor, 2009, Inc." Def. Aff. at 30 ~ 58. In fact, the victim of the theft is Mayor Michael Bloomberg personally.

12 Defendants do not seem to provide reasons why the Indictment should be dismissed against SE~ in the interests of justice.

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A The Legal Standard

The court's authority to dismiss an indictment in the interest of justice is delineated in c.P.L. § 210.40. This provision enables a court to terminate a prosecution without the consent of the District Attorney, the public officer elected by the People who is normally charged with the responsibility of detennining when and in what manner to prosecute a suspected offender. County Law § 700(1); People u: DiFalco, 44 N.Y.2d 482, 486 (1978); accord United Stoter tJ. Lauasco, 431 U.S. 783 (1977); People u: Harmon, 181 AD.2d 34, 38 (I" Dept. 1992). "This is, needless to say, a power which should be exercised most sparingly, and only in those cases where some 'compelling factor' (citation to statute omitted) warrants the conclusion that the court should substitute its discretion for that of the District Attorney

" People v. Field, 161 A.D.2d 660,661 (2d Dept. 1990).

Accordingly, the statute expressly limits a court's power to dismiss an indictment in the interest of justice to prosecutions presenting truly extraordinary circumstances. «An indictment may be dismissed in the furtherance of justice only when there exists 'some compelling factor, consideration or circumstance clearly demonstrating that conviction or prosecution of the defendant upon such indictment or count would constitute or result in injustice." People v. Pittman, 228 A.D.2d 225, 226 (1st Dept. 1996), (citing § c.P.L. 210.40(1)); People v. Stewart, 230 A.D;2d 116, 120 (1st Dept. 1997).

The appellate courts of this state have consistently recognized that the power to dismiss an indictment pursuant to this statute is warranted only in the "unusual case that cries out for fundamental justice beyond the confines of conventional considerations of 'legal or factual merits of the charge or even on the guilt or innocence of the defendant.'" People ti: Beige, 41 N.Y.2d 60, 62-63 (1976) (Fuchsberg, J., concurring); People u: Pittman, 228 A.D.2d 225, 226 (1st Dept. 1996); People u: Perez, 156 A.D.2d 7 (1st Dept. 1990); People u:

36

Howard. 151 A.D.2d 253 (1st Dept. 1989); People v. Diggs, 125 A.D.2d 189 (1st Dept. 1986);

People v: Insignares, 109 AD.2d 221 (1st Dept. 1985).

Moreover, a court's power to dismiss an indictment in the interest of justice does not

"convey an untrammeled right to act on purely subjective considerations. Requited, rather,

[is] a sensitive balancing of the interests of the individual and of the People." People u: Rickert,

58 N.Y.2d 122, 126-27 (1983); accord People v. Wingard, 33 NY.2d 192, 196 (1973)(a court's

discretionary power to dismiss an indictment in the interest of justice "is neither absolute nor

uncontrolled"). To this end. subdivision two of the statute mandates that a court presented

with an application to invoke this authority consider, to the extent applicable, each of ten

factors concerning the nature and circumstances of the offense and the effects of a

dismissal. See C.P.L § 210.40 (l)(a)-G).

(a) the seriousness and circumstances of the offense;

(b) the extent ofhann caused by the offense;

(c) the evidence of guilt, whether admissible or inadmissible at trial;

(d) the history, character and condition of the defendant

(e) any exceptionally serious misconduct of law enforcement personnel in the investigation, arrest and prosecution of the defendant;

(f) the putpose and effect of imposing upon the defendant a sentence authorized for the offense;

(g) the impact of dismissal upon the confidence of the public in the criminal justice system;

(h) the impact of a dismissal on the safety or welfare of the community;

(i) where the court deems it appropriate, the attitude of the complainant or victim with respect to the motion;

37

G) any other relevant fact indicating that a judgment of conviction would serve no useful puxpose.

B. The Offense Was Serious and Caused Significant Harm

Haggerty seems to argue that the offense was not serious because Haggerty's "alleged

wrongdoings have no effect on the alleged victim, Bloomberg for Mayor, Inc." (Def. Aff. at 30

, 58(1)). Haggerty is wrong. First, Haggerty misidentifies the victim. The victim of the theft of

over $1 million is Michael Bloomberg, not Bloomberg for Mayor 2009, Inc. But more

importantly, to further imply, as Haggerty does, that the Penal Law should not be applied to

wealthy victims is absurd. The law applies equally to all, wealthy and poor, powerful and

powerless, alike.

Second, Haggerty's cnmes caused senous harm to the Campaign and to Mayor

Bloomberg himself. Because Haggerty funneled the proceeds of his theft through a political

party and a mysterious dummy entity, SE~, questions were raised by the press and the public as

to whether Mayor Bloomberg intentionally tried to hide payments to Haggerty for some

nefarious or illicit purpose. Through his lies and clumsy attempts to cover-up his crimes,

Haggerty caused unfair questions to be raised about Mayor Bloomberg's integrity.

Third, Haggerty's crimes caused harm to the transparency of the political process.

Hidden deals and the movement of political money through shell corporations is anathema to

the valued goal of an open, fair, and transparent political process. Haggerty lied when he

purported to work for the Campaign as a volunteer. Haggerty lied when he submitted a false

budget to Mayor Bloomberg's agents. Haggerty lied when he claimed that he had spent the

money on the Operation when in reality he used it to purchase a house. Haggerty's lies inflicted

additional damage on a political process already viewed with a fair degree of cynicism by the

public. Haggerty's arguments should be rejected.

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C. The Evidence of Haggerty's Guilt is Overwhelming

The evidence of Haggerty's guilt is overwhelming. As detailed above in the recitation

of facts, Grand Jury testimony by eye-witnesses, documents, and admissions by Haggerty

himselfcontained in e-mails, statements, and ultimately futile attempts to cover-up his theft,

provide crushing evidence of his guilt.

D. The History, Character, and Condition of the Defendant Do Not Warrant Dismissal

Haggerty also argues that because, among other things, he never had any prior

conflicts with the law, was an apparendy caring family member, and was a public servant

most of his adult life, that the Indictment should be dismissed. Haggerty's arguments are

absurd and should be rejected.

Lack of prior criminal convictions for crimes of violence and a defendant's standing in

the community do not constitute compelling reasons for dismissal. People v. Riccelli, 149 AD.2d

941, 942 (4th Dept. 1989); People v. Varekt, 106 AD.2d 339, 340 (Isr Dept. 1984); People v.

Litman, 99 AD.2d 573 (3d Dept. 1984); People P. Surprenant, 91 AD.2d 1111, 1112 (3d Dept. 1983); People v. Andrew, 78 A.D.2d 683 (2d Dept. 1980). Moreover, Haggerty's background

makes his present crimes all the more serious. Haggerty's crime was not the result of a

momentary impulsive act. His crimes involved months of planning and continued deception.

Haggerty stole Mayor Bloomberg's money and used it to purchase a house and later tried to

cover-up the theft by creating false checks purporting to represent payments to poll watchers.

(Affirmation of Eric Seidel, dated October 28, 2010, ~ 4).

Moreover, Haggerty's statements to law enforcement are strongly informative on the

crucial question of character. In a statement to the District Attorneys Office in the presence of

his counsel, Haggerty admitted that he did not disclose that he was going to keep the money

budgeted for the Operation for himself because he believed that if he did, Mayor Bloomberg

39

would not have given him the money. (Affinnation of Eric Seidel, dated October 28, 2010, ~

4). Haggerty also admitted that he lied and mislead the Campaign as to what he intended to do

with the money budgeted for the Operation and that he created and sent the three fake checks.

(Affinnation of Eric Seidel, dated October 28,2010,114). His statements to law enforcement

demonstrate that his willingness to use deception to achieve his goals and dismissal of the

indictment is not wananted

E. Purpose and Effect of Imposing Upon the Defendant a Sentence Authorized for the Offense; Impact of Dismissal Upon the Confidence of the Public in the Criminal Justice system; Impact of a Dismissal on the Safety or Welfare of the Community

Haggerty argues that a sentence of incarceration «may deprive the public of a valuable

public servant." (Def. Aff. at 351158(4)). The Appellate Division has held that even when the

imposition of a jail sentence is mandatory, dismissal in the interest of justice is not warranted.

See Peuple v. V tmh, 106 A.D.2d at 339-40. Moreover, a sentence of incarceration would not

deprive the public of a valuable public servant Rather, the public would be spared the

continued involvement of an unethical official who employed deception and fraud to satisfy his

greed.

Incredibly, Haggerty assetts that because he has worked for the New York State

"comptroller, attomey general, and governor" that the indictment should be dismissed. (De£

Aff. at 35 ~58(4)). Haggerty is wrong. Dismissal of the Indictment would send a particularly

harmful message to the public that individuals who work for powerful politicians can avoid

prosecution. Dismissal would diminish the confidence of the public in the criminal justice

system, not strengthen it.

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POINT TWELVE

THE PEOPLE REQUEST RECIPROCAL DISCOVERY

The People request reciprocal discovery pm:suant to c.P.L. § 240.30 and production

of all prior statements of any non-defendant witness in the control of the defense, that the

defense intends to call as a witness at trial, pursuant to People v. Damon, 24 N.Y.2d 256 (1969).

CONCLUSION

The defendants have failed to provide this court with any compelling facts and

circumstances to justify the granting of a motion to dismiss in the interests of justice. Their

motion should, therefore, be denied.

For the reasons set forth above, it is respectfully requested that, except as consented

to in this Memorandum of Law, the defendants' motions be denied.

Respectfully submitted,

CYRUS R. VANCE, JR. DISTRICT ATTORNEY

By:

...

Ea4:-<euN

Eric Seidel

Assistant District Attorney

Brian P. Weinb~g Assistant District Attorney

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