United States v. Stanley J. Kowalewski
708 F. App'x 605
11th Cir.2017Background
- Stanley J. Kowalewski was CEO of SJK Investment Management and secretly created the Special Opportunities Fund (SOF) in 2009.
- He diverted over $16 million of investor funds into the SOF without investor knowledge, transferred over $4 million to his personal accounts, and used funds to buy multiple homes.
- Investors received monthly statements and letters that materially misrepresented account balances, asset allocations, and SJK’s assets under management.
- A federal jury convicted Kowalewski of 22 counts of wire fraud (18 U.S.C. § 1343 & § 2), one count of conspiracy to obstruct an SEC proceeding (18 U.S.C. § 371), and one count of obstruction of an SEC proceeding (18 U.S.C. §§ 1505 & § 2).
- Evidence at trial included inflated account statements, false oral and written representations about investments, backdated rental agreements created with CFO Michael Fulcher, and Kowalewski’s false SEC testimony.
- The district court sentenced him to 209 months’ imprisonment; Kowalewski appealed challenging sufficiency of the evidence and various other issues.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Sufficiency of evidence for wire fraud (intent) | Government: circumstantial evidence (false statements, inflated valuations, misstatements about strategy and AUM, diversion of funds) shows intent to defraud | Kowalewski: lacked intent to defraud; contractual disclosures/PPMs and oral statements negated fraud | Affirmed — evidence viewed in prosecution's favor was sufficient for a rational juror to find intent beyond a reasonable doubt |
| Sufficiency for conspiracy to obstruct SEC (agreement & overt act) | Government: Fulcher’s guilty plea and testimony that he backdated rental agreements at Kowalewski’s direction show agreement and overt act | Kowalewski: disputes existence of corrupt agreement and that acts were conspiratorial | Affirmed — jury could find knowing participation and overt act (backdated leases) in furtherance of conspiracy |
| Sufficiency for obstruction of SEC (corruptly endeavor to obstruct) | Government: false testimony, backdated documents, and misrepresentations to SEC satisfy corrupt intent and obstructive conduct | Kowalewski: argued lack of corrupt intent and that disclosures/PPMs excuse conduct | Affirmed — evidence supports finding Kowalewski acted corruptly to obstruct SEC investigation |
| Miscellaneous evidentiary, procedural, and sentencing challenges | Government: record supports district court rulings | Kowalewski: raised multiple trial and sentencing errors | Affirmed — court affirmed these issues after review without further discussion |
Key Cases Cited
- United States v. Harrell, 737 F.2d 971 (11th Cir. 1984) (standard for sufficiency review and viewing evidence in the light most favorable to the verdict)
- United States v. Broughton, 689 F.3d 1260 (11th Cir. 2012) (deference to jury credibility choices and inferences supporting the verdict)
- Jackson v. Virginia, 443 U.S. 307 (1979) (relevant inquiry for sufficiency: whether any rational trier of fact could have found guilt beyond a reasonable doubt)
- United States v. Hasson, 333 F.3d 1264 (11th Cir. 2003) (elements of wire fraud and conspiracy explained)
- United States v. Jennings, 599 F.3d 1241 (11th Cir. 2010) (circumstantial evidence can establish intent to defraud)
- United States v. Weaver, 860 F.3d 90 (2d Cir. 2017) (discusses meaning of acting "corruptly" in obstruction context)
- United States v. Lucas, 516 F.3d 316 (5th Cir. 2008) (obstruction/corruptly analysis)
- United States v. Ghilarducci, 480 F.3d 542 (7th Cir. 2007) (obstruction/corruptly analysis)