United States v. O'Brien, 1:17-cr-00239

Background

Indictment charges Jessica O’Brien and Maria Bartko with a multi-year mortgage-fraud scheme centered on two Chicago investment properties sold in 2007 using an alleged straw buyer.
Bartko cooperated and testified before the grand jury; her testimony supported key 2007 allegations (use of a straw buyer, payments from O’Brien).
After Bartko’s grand jury testimony but before the indictment, O’Brien produced two notarized “Acknowledgment & Agreements” documents showing Bartko identified as a buyer and noting certain “AS IS” terms and minor repair obligations.
O’Brien moved to dismiss the indictment, arguing (1) Bartko’s grand jury testimony was perjured in light of the acknowledgements and (2) the government had an obligation to correct that testimony once the acknowledgements were produced to the government.
The government did not knowingly present false testimony and did not present the acknowledgements to the grand jury; it opposed dismissal, arguing the acknowledgements do not prove perjury and, even if exculpatory, prosecutors need not present exculpatory evidence to a grand jury.
The Court denied O’Brien’s motion: the acknowledgements do not conclusively show Bartko perjured herself; the prosecutor’s failure to present or correct the grand jury with the acknowledgements did not violate a clear rule requiring dismissal; and O’Brien failed to show prejudice to the grand jury’s decision to indict.

Issues

Issue	Plaintiff's Argument (O’Brien)	Defendant's Argument (Government/Bartko)	Held
Whether grand jury indictment must be dismissed for alleged use of perjured testimony	Bartko perjured herself; documents prove her testimony false and government should have corrected it	Government did not knowingly present false testimony; acknowledgements do not establish perjury	Denied — O’Brien failed to prove Bartko’s grand jury testimony was perjured
Whether prosecutor had an affirmative duty to correct allegedly false grand jury testimony after learning of new evidence	Government had duty to correct once it learned of the acknowledgements	Prosecutor has no obligation to present or correct the grand jury with potentially exculpatory evidence; only clear rule violations require dismissal	Denied — no clear-rule violation; Brady does not impose such a grand-jury-correction obligation
Whether failure to present potentially exculpatory acknowledgements to the grand jury requires dismissal	Withholding the acknowledgements substantially influenced the grand jury	Presenting exculpatory evidence is not required; even if withheld, must show prejudice under Bank of Nova Scotia	Denied — O’Brien did not show prejudice or substantial influence on grand jury decision
Whether acknowledgements conclusively negate alleged fraudulent intent/acts (e.g., concealment from lenders, inflated price)	Acknowledgements show buyer identified and repairs/"AS IS" terms, undermining allegations of concealment and fraud	Acknowledgements may not have reached lenders, conflict with other contracts, are potentially hearsay, and do not refute other record evidence	Denied — factual disputes remain for trial; documents are not dispositive of intent or fraud

Key Cases Cited

Brady v. Maryland, 373 U.S. 83 (1963) (prosecution must disclose evidence favorable to defendant when material to guilt or punishment)
United States v. Williams, 504 U.S. 36 (1992) (prosecutor not required to present exculpatory evidence to grand jury)
Bank of Nova Scotia v. United States, 487 U.S. 250 (1988) (indictment may be dismissed for grand jury misconduct only if defendant shows prejudice/substantial influence)
United States v. Fountain, 840 F.2d 509 (7th Cir. 1988) (knowing use of perjured testimony might justify dismissal but prosecutor may present testimony for what it’s worth)
United States v. Roth, 777 F.2d 1200 (7th Cir. 1985) (use of known perjured evidence can justify dismissal if prejudicial)
United States v. Bland, 517 F.3d 930 (7th Cir. 2008) (explaining Brady elements)
United States v. Gardner, 860 F.2d 1391 (7th Cir. 1988) (government not required to submit exculpatory evidence to grand jury)
United States v. Vincent, 416 F.3d 593 (7th Cir. 2005) (prejudice standard applies before dismissing indictment for grand jury misconduct)
United States v. Udziela, 671 F.2d 995 (7th Cir. 1982) (addressing perjured testimony before grand jury)
United States v. Provenzano, 440 F. Supp. 561 (S.D.N.Y. 1977) (dismissal where witness recanted prior to indictment; distinguished by court here)