Stinn v. United States
1:11-cv-02071
| E.D.N.Y | Dec 5, 2024Background
- Bradley J. Stinn, former CEO of Friedman’s Inc., was convicted in 2009 for conspiracy to commit securities, mail, and wire fraud, as well as substantive securities and mail fraud, arising from his role in manipulating company earnings and misleading investors.
- Stinn served his sentence, including supervised release, and then sought to vacate his convictions by writ of error coram nobis after the Supreme Court’s 2023 decision in Ciminelli v. United States, which invalidated the "right-to-control" theory of fraud.
- He also moved under Federal Rule of Civil Procedure 60(b) to vacate a previous denial of habeas relief from 2012, arguing that his convictions were tainted by legal error now clarified by Ciminelli.
- The government’s case against Stinn included both the right-to-control theory and traditional fraud theory (deprivation of money or property), and the jury was presented evidence supporting both.
- The district court reviewed whether the jury’s general verdict could stand post-Ciminelli, given that the conviction was not based solely on the now-invalid theory.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the invalidation of the right-to-control theory in Ciminelli invalidates Stinn’s convictions | Stinn: Convictions must be vacated because jury may have relied on invalid right-to-control theory | Government: Sufficient evidence and instructions supported conviction under traditional fraud theory | Right-to-control error was harmless because of ample evidence and instruction on traditional fraud |
| Whether Stinn’s bonus/salary could satisfy the "money or property" requirement for fraud statutes | Stinn: Bonus and salary were not "money or property" within the meaning of the statutes | Government: Bonus and salary were direct financial benefits obtained by fraud | Bonus/salary are "money or property" under the statutes; argument rejected |
| Whether Rule 60(b)(1) permits vacatur of prior habeas denial based on Ciminelli | Stinn: Legal error discovered after judgment justifies relief, not time-barred | Government: Motion is time-barred (must be brought within one year) | Rule 60(b)(1) claim is time-barred; cannot consider argument |
| Whether the change in law constitutes extraordinary circumstances under Rule 60(b)(6) for relief | Stinn: Supreme Court’s change in law is an extraordinary circumstance warranting relief | Government: Change in law alone is insufficient for Rule 60(b)(6) relief | Intervening legal developments alone rarely justify Rule 60(b)(6); relief denied |
Key Cases Cited
- Ciminelli v. United States, 598 U.S. 306 (2023) (invalidated the right-to-control theory of fraud for federal wire fraud prosecutions)
- Carpenter v. United States, 484 U.S. 19 (1987) (discussed the scope of property under the mail and wire fraud statutes)
- Cleveland v. United States, 531 U.S. 12 (2000) (cautioned against federalizing state matters under fraud statutes)
- Kelly v. United States, 590 U.S. 391 (2020) (clarified limits of federal fraud statutes in policy contexts)
- Hedgpeth v. Pulido, 555 U.S. 57 (2008) (harmless error analysis for flawed instructions)
- O’Neal v. McAninch, 513 U.S. 432 (1995) (harmless error standard for constitutional errors)