Bourke Appeal

8/2/2019 Bourke Appeal

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IN THE

United States Court of AppealsFOR THE SECOND CIRCUIT

UNITED STATES OF AMERICA , Appellee,

LANDLOCKED SHIPPING COMPANY , J ITKA CHVATIK , Doctor,Petitioner,

v.

FREDERIC BOURKE , J R ., Defendant-Appellant,

V IKTOR KOZENY , D AVID P INKERTON , Defendants.

INITIAL BRIEF AND SPECIAL APPENDIXFOR DEFENDANT-APPELLANT

Harold A. HaddonSaskia A. JordanHADDON , M ORGAN & F OREMAN , P.C.150 East 10th AvenueDenver, Colorado 80203

303-831-7364Michael E. TigarJane Blanksteen TigarLAW OFFICE OF M ICHAEL E. T IGARP.O. Box 528Oriental, North Carolina 28571202-549-4229

On Appeal from the United States District Court for the Southern District of New York (New York City)

11 -5390 -CR07-3107- CR, 09-4704- CR, 09-5149- CR

John D. ClineLAW OFFICE OF JOHN D. C LINE235 Montgomery Street, Suite 1070San Francisco, California 94104415-322-8319

Attorneys for Defendant-Appellant

Case: 11-5390 Document: 25 Page: 1 04/10/2012 576064 86


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TABLE OF CONTENTS

STATEMENT OF SUBJECT MATTER AND APPELLATEJURISDICTION ............................................................................................. 1

STATEMENT OF THE ISSUES.............................................................................. 1

STATEMENT OF THE CASE ................................................................................. 2

I. INTRODUCTION. ............................................................................... 2

II. THE PROCEEDINGS TO DATE. ...................................................... 5

III. STATEMENT OF FACTS. .................................................................. 7

A. Kozeny's Scheme. ...................................................................... 7

B. Bodmer's False Story at Trial. .................................................... 8C. The Government's Position on Appeal. ................................... 16

D. The Government's Response to the Motion for NewTrial. ......................................................................................... 19

SUMMARY OF THE ARGUMENT ..................................................................... 22

ARGUMENT .......................................................................................................... 25

I. PROSECUTORS ARE FORBIDDEN FROM PRESENTINGMATERIALLY FALSE TESTIMONY. ........................................... 25

II. THE DISTRICT COURT SHOULD AT LEAST HAVE HELDAN EVIDENTIARY HEARING. ...................................................... 32

A. The Record Raises Significant Questions About theProsecutors' Knowledge of Bodmer's False Walk Talk Story. ........................................................................................ 33

B. An Evidentiary Hearing Is Necessary. ..................................... 37

III. THE PROSECUTORS' PRESENTATION OF BODMER'SFALSE WALK TALK TESTIMONY REQUIRESREVERSAL. ...................................................................................... 42

IV. BOURKE PRESENTED NEWLY DISCOVEREDEVIDENCE. ....................................................................................... 43

CONCLUSION ....................................................................................................... 47



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CERTIFICATE OF COMPLIANCE ...................................................................... 49



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TABLE OF CITATIONS

Page

C ASES

Alcorta v. Texas , 355 U.S. 28 (1957) .......................................................................26

Banks v. Dretke , 540 U.S. 668 (2004) .....................................................................44

Communist Party of United States v. SACB , 351 U.S. 115 (1956) .........................39

Demjanjuk v. Petrovsky , 10 F.3d 338 (6th Cir. 1993) .............................................39

Drake v. Portuondo , 553 F.3d 230 (2d Cir. 2009)...................................... 26, 32, 40

Franks v. Delaware , 438 U.S. 154 (1978) ...............................................................39

Giglio v. United States , 405 U.S. 150 (1972) ................................................... 26, 37

Kyles v. Whitley , 514 U.S. 419 (1995) ........................................................ 25, 37, 46

Mooney v. Holohan , 294 U.S. 103 (1935) ........................................................ 22, 26

Napue v. Illinois , 360 U.S. 264 (1959) ............................................................. 26, 30

Roberts v. United States , 389 U.S. 18 (1967) ..........................................................39

United States v. Agurs , 427 U.S. 97 (1976) ................................................ 26, 27, 42

United States v. Blair , 958 F.2d 26 (2d Cir. 1991) ..................................................43

United States v. Bourke , 667 F.3d 122 (2d Cir. 2011) .........................................6, 10

United States v. Ferguson , 653 F.3d 61, 83 (2d Cir. 2011) .....................................43

United States v. Freeman , 2009 U.S. Dist. LEXIS 76973(N.D. Ill. Aug. 26, 2009) ......................................................................................30

United States v. Freeman , 650 F.3d 673 (7th Cir. 2011)................................. passim

United States v. GAF Corp. , 928 F.2d 1253 (2d Cir. 1991) ....................... 25, 45, 47

United States v. Helmsley , 985 F.2d 1202 (2d Cir. 1993) .......................................40

United States v. Kozeny , 493 F. Supp. 2d 693 (S.D.N.Y. 2007) ............................... 5



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United States v. Kozeny , 541 F.3d 166 (2d Cir. 2008) .............................................. 5

United States v. McKeon , 738 F.2d 26 (2d Cir. 1984) ..................................... passim

United States v. Mitchell , 365 F.3d 215 (3d Cir. 2004) ...........................................39

United States v. Sager , 227 F.3d 1138, 1145-46 (9th Cir. 2000) ............................46

United States v. Vozzella , 124 F.3d 389 (2d Cir. 1997) .............................. 26, 38, 42

United States v. Wallach , 935 F.2d 445 (2d Cir. 1991) ................................... passim

United States v. Zichettello , 208 F.3d 72 (2d Cir. 2000) .........................................43

Wei Su v. Filion , 335 F.3d 119, 126 (2d Cir. 2003) .................................................26

STATUTES

18 U.S.C. 3231 ........................................................................................................ 1

28 U.S.C. 1291 ........................................................................................................ 1

OTHER

AUTHORITIES

Restatement (Third) of the Law Governing Lawyers 116, comment b(American Law Institute 2000) ............................................................................29

Stephen S. Trott, Words of Warning for Prosecutors Using Criminalsas Witnesses , 47 Hastings L.J. 1381 (1996) .........................................................26



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STATEMENT OF SUBJECT MATTER AND APPELLATE JURISDICTION

The district court had subject matter jurisdiction under 18 U.S.C. 3231.

The district court denied appellant Frederic Bourke, Jr.'s timely motion for new

trial based on newly discovered evidence, and his request for an evidentiary

hearing, on December 15, 2011. SA1. Bourke filed his notice of appeal on

December 21, 2011. JA898. This Court has jurisdiction under 28 U.S.C. 1291.

STATEMENT OF THE ISSUES

This appeal focuses on the government's newly-announced and startling

view of a federal prosecutor's duty when he knows or should know that a

prosecution witness will testify falsely at trial or has done so. The government

maintains that the prosecutor may sponsor testimony he knows or should know is

false, as long as evidence demonstrating the falsity is presented to the jury

eventually. Appellant Bourke contends that a federal prosecutor may never present

testimony he knows or should know is false. The district court avoided choosing

between these competing views by finding--without an evidentiary hearing and

without a sworn statement by any prosecutor--that the prosecution neither knew

nor should have known that the testimony at issue was false.

The questions presented are:

1. May a federal prosecutor present testimony he knows or should know

is materially false?



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2. Where the defense presents evidence that a federal prosecutor knew or

should have known that his cooperating witness' testimony was materially false,

does the district court err in refusing to conduct an evidentiary hearing and in

relying instead on another prosecutor's unsworn reported denial of knowledge?

3. Did Bourke produce newly discovered evidence in support of his

motion for new trial?

STATEMENT OF THE CASE

I. INTRODUCTION.At Bourke's trial, the prosecution called Swiss lawyer Hans Bodmer as a

witness. Bodmer had pleaded guilty to money laundering conspiracy, signed a

cooperation agreement, and was awaiting sentencing. For the five years following

his plea, the prosecution had permitted him to return to Switzerland and resume his

law and banking practice. Bodmer testified to a conversation he claimed to have

had with Bourke in Baku, Azerbaijan during a walk on the morning of February 6,

1998--what became known as the "walk talk." The prosecution made this

conversation a centerpiece of its opening statement. It had Bodmer testify in detail

about the alleged February 6 walk talk and preparatory conversations on February

5.

When the prosecution gave its opening, and when it presented Bodmer, it

had in its possession flight records and other documents proving that Bourke was



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not in Baku when Bodmer said the walk talk and the other conversations occurred.

When confronted with the flight records after Bodmer's testimony, the prosecution

first presented a misleading summary of them. Then, with Bodmer safely out of

the country, the prosecution stipulated to the facts contained in the records. In

closing argument, the prosecution argued, contrary to Bodmer's testimony and all

other relevant evidence, that the walk talk must have occurred in April 1998, the

only other time Bodmer and Bourke were in Baku together. The prosecution never

confronted Bodmer, its cooperating witness, about his false testimony and thus--by

avoiding learning the truth--preserved its ability to argue that Bodmer was merely

"mistaken" about the "details" of the walk talk.

At the February 10, 2011 oral argument before this Court on Bourke's initial

appeal, one of the prosecutors--AUSA Harry Chernoff--asserted that it would have

been improper to show Bodmer the travel records during his witness preparation

sessions. Upon learning the prosecution's surprising position that it would neither

correct nor forego a witness' false testimony, and its seeming concession that it had

known Bodmer's walk talk testimony was false, Bourke moved for a new trial and

requested an evidentiary hearing.

The district court heard argument on the motion but refused to take

evidence. The prosecutor who prepared and presented Bodmer's false testimony

and gave the opening featuring the nonexistent February 5 and 6, 1998



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conversations--DOJ attorney Robertson Park--did not appear at the argument,

purportedly because of "budgetary restraints." The prosecutor who did appear--

AUSA Chernoff--did not participate in the preparation of Bodmer's testimony and

had no personal knowledge of what occurred between Bodmer and other

prosecutors, including Park. That witness preparation process, which we discuss

below, extended over a five-year period and was conducted by AUSA Park and

then-DOJ lawyer Mark Mendelsohn. The district court nonetheless accepted

AUSA Park's unsworn hearsay assertion, presented in argument by AUSA

Chernoff, that the government did not know Bodmer's walk talk testimony was

false until the defense brought forward the flight records.

During the argument on the new trial motion, AUSA Chernoff repeated his

position (and, he asserted, the position of his office) that it would be improper to

correct a witness' false recollection during preparation for his testimony. Under

questioning by the district court, AUSA Chernoff went even further: he asserted

that a prosecutor can present testimony he knows is false as long as information

exposing the falsehood is conveyed to the jury.

The district court denied the defense motion for new trial and declined to

hold an evidentiary hearing. SA1. This appeal followed.



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II. THE PROCEEDINGS TO DATE.

The grand jury indicted Bourke and two other defendants--Viktor Kozeny

and David Pinkerton of AIG--on May 12, 2005. Kozeny remains a fugitive in the

Bahamas. 1 The government dismissed charges against Pinkerton in 2008. The

case went to trial against Bourke alone. The indictment charged Bourke with

conspiracy to violate the FCPA and the Travel Act; money laundering conspiracy;

substantive FCPA, Travel Act, and money laundering violations; and false

statements. It sought forfeiture of $174,000,000.

Bourke moved to dismiss (except for the false statement charge) on statute

of limitations grounds. The district court dismissed a number of the counts, United

States v. Kozeny , 493 F. Supp. 2d 693 (S.D.N.Y. 2007), and this Court affirmed,

United States v. Kozeny , 541 F.3d 166 (2d Cir. 2008). Bourke went to trial on

three charges: conspiracy to violate the FCPA and the Travel Act; money

laundering conspiracy; and false statements to the FBI. The government reduced

its requested forfeiture to $100,000,000. JA52-86.

1 The Privy Council of the United Kingdom recently dismissed the appeal bythe United States and Bahamian governments from the order of a Bahamian court

discharging Kozeny from custody based on a determination that he could not beextradited from the Bahamas to the United States. Superintendent v. Kozeny ,[2012] UKPC 10. The dismissal of the appeal likely means that Kozeny will never

be tried in the United States--leaving Bourke as the only defendant to stand trialand (assuming the cooperators avoid incarceration) the only defendant to receive a

prison sentence. The cooperators have yet to be sentenced, years after their guilty pleas, apparently because the prosecution thinks Kozeny might yet be tried.



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Trial began on June 1, 2009 and concluded on July 10. The jury acquitted

Bourke on money laundering conspiracy and found him guilty on the other two

charges. JA40. The district court denied Bourke's motions for new trial and for

judgment of acquittal. DE251; JA42.

On November 10, 2009, the district court sentenced Bourke to a year and a

day incarceration and a $1 million fine. DE253; JA42-43. The court recounted

Bourke's good works and declared that "[a]fter years of supervising this case, it is

still not entirely clear to me whether Mr. Bourke was a victim, or a crook, or a little

bit of both." JA444. The court released Bourke pending appeal. DE254; JA43.

This Court heard oral argument on February 10, 2011, and affirmed

Bourke's conviction on December 14. United States v. Bourke , 667 F.3d 122 (2d

Cir. 2011). Bourke filed a timely petition for rehearing and rehearing en banc,

which is pending. The district court continued him on bail pending appeal.

On March 9, 2011, Bourke filed a motion for new trial. JA46, 462. The

motion focused on the prosecutors' presentation of testimony from Bodmer that

they knew or should have known was false and AUSA Chernoff's statement in oral

argument before this Court appearing to acknowledge that the prosecutors knew

Bodmer's testimony was false when they presented it. Bourke requested an

evidentiary hearing on the motion. On November 10, 2011, the district court held

oral argument but declined to hold an evidentiary hearing. JA843. The court



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denied the motion on December 15, and Bourke filed a timely notice of appeal.

SA1.

III. STATEMENT OF FACTS.

A. Kozeny's Scheme.

In the mid-1990s, Azerbaijan--an oil-rich former Soviet republic--began

privatizing its state-owned enterprises. A Czech entrepreneur, Viktor Kozeny,

launched an effort to acquire the state-owned oil company, SOCAR, through a

privatization auction. Bourke and other Americans (including Columbia

University, AIG, and former Senator George Mitchell) invested and lost millions

of dollars with Kozeny.

In late 1998, Bourke learned that Kozeny and his associates had committed a

massive fraud against the investors. He urged that this fraud be reported to the

authorities. In the course of the investigation that Bourke triggered and civil

litigation that followed, it emerged that Kozeny, with the assistance of Bodmer and

others, had paid substantial sums to Azeri government officials.

Bourke cooperated with federal prosecutors, state prosecutors and the FBI.

He met with prosecutors and agents for four days in 2002 and waived the attorney-

client privilege so the government could interview his lawyers and obtain their

documents. The Manhattan District Attorney indicted Kozeny for theft based in

part on Bourkes testimony and information he provided. In the end, however, the



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federal government embraced Bodmer and other cooperating witnesses and

indicted Bourke for participating in Kozeny's bribery and for lying to the FBI when

he denied knowledge of the bribes.

B. Bodmer's False Story at Trial.

The prosecution's theory of the case, laid out in opening statement, turned on

the timing of Bodmer's alleged walk talk with Bourke. Prosecutor Park told the

jury that the evidence would show that Bourke had been hesitant to invest with

Kozeny in Azerbaijan until he learned from Bodmer that Kozeny was bribing the

Azeris. The February 6, 1998 walk talk with Bodmer was the key to this narrative.

Prosecutor Park told the jury that on one of Bourke's pre-investment trips to Baku,

Bodmer had "told the defendant about the Azeri's two-thirds interest in Oily Rock's

vouchers, about all of the holding companies, and about all the structure that gave

the Azeri officials a huge incentive to privatize SOCAR." JA486-87. The

prosecutor continued:

Bourke was sold. The evidence will show that the defendant went back home and within days instructed his lawyers to organize his ownoffshore company in the British Virgin Islands, a company namedBlueport. And then in March, 1998 he funded his investment in OilyRock with about $5 million in his own money and another 2 million

he raised from friends and family.JA487.

Bourke had met with Bodmer in Baku only once before his investment in

March 1998--on an early February 1998 trip with Kozeny and American investor



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Bobby Evans. To support the government's theory, therefore, it was essential for

Bodmer to testify that he had told Bourke about the bribery on that February trip.

As we discuss below, the prosecutors would not give Bodmer his deal until he

altered his initial version, told them that the walk talk occurred in February, and

then surrounded that story with allegedly corroborating detail. By the time of

Bourke's trial, five years later, Bodmer understood what was expected of him.

On direct examination, under carefully scripted questioning by prosecutor

Park, Bodmer testified that on the late afternoon of February 5, 1998 Bourke

approached him in the lobby of the Baku Hyatt and asked about the "arrangement"

with the Azeris. Bodmer testified that he met Kozeny that evening in Kozeny's

hotel room in Baku and obtained permission to tell Bourke about the agreement to

give President Aliyev two-thirds of the Oily Rock vouchers and options. And

Bodmer testified that at 8 am on February 6, 1998, he and Bourke took a fifteen-

minute walk near the Hyatt during which he told Bourke about that agreement.

JA496-506. According to Bodmer, "[a]bout two weeks" after the February 6 walk,

Bourke agreed to invest. JA507-08.

The prosecution did not inform the defense, the Court, or the jury that it was

eliciting false testimony from Bodmer about the February 5 discussions with

Bourke and Kozeny and the February 6 walk talk. To the contrary, it sought to

corroborate that testimony by introducing Bodmer's time records from February 5



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and 6 (JA608-10), which included a reference to Evans and Bourke on February 6,

and by having Bodmer testify that, after some initial uncertainty, he had pinpointed

the February dates because he remembered that Evans was with him in Baku on

the occasion of the walk talk and the February trip was the only time he and Evans

had both been in Baku. JA505-06. The prosecution likewise called Rolf Schmid

(Bodmer's Swiss law partner) and introduced a fragment of his 2001 memorandum

(while persuading the district court to exclude other portions that undercut its

credibility) to corroborate Bodmer's false testimony about the February 6 walk

talk. 2 And the prosecution introduced Bodmer's plea agreement (JA918) and

highlighted his purported obligation to "give truthful and complete" testimony.

JA148-49.

Within days after Bodmer completed his testimony, the defense notified the

prosecution that it intended to call a witness from Universal Aviation & Weather,

the flight control company that had made the ground arrangements for Kozeny's

plane on the February 1998 trip. The witness would authenticate and explain flight

records that the government had produced to the defense in discovery. It had taken

the defense several days to validate the records and to locate a witness who could

2 The defense objected to the exclusion of other portions of the Schmidmemorandum under Fed. R. Evid. 106 and argued that those portions wereessential to place in context the fragment of the memo that the prosecution offered.The district court excluded the portions Bourke sought to introduce, and this Courtaffirmed the exclusion on appeal. See 667 F.3d at 37-39. The Rule 106 issue isincluded in Bourke's pending petition for rehearing.



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authenticate and explain them. Those records showed that Bourke and Kozeny

were in London--not in Baku--on February 5. Thus, the records refuted Bodmer's

testimony that Bourke asked him about the "arrangement" on February 5 in Baku,

and that Bodmer met with Kozeny in a Baku hotel to obtain Kozeny's approval to

discuss it with Bourke. JA590-91, 596, 923-26. The records (and Evans'

testimony and daily diary, JA618-19) proved as well that Kozeny's plane did not

land in Baku until 9:20 am on February 6, over an hour after Bodmer claimed the

walk talk had occurred. Id .

Faced with the prospect of the defense introducing the flight records, the

prosecution sought to diminish their force by presenting a witness (summer intern

Dana Roizen) to summarize them in a chart, along with other travel records. But

Roizen's chart incorrectly placed Kozeny in Baku on February 5 (meaning that he

could have talked with Bodmer there), even though the flight records proved he

was in London until midnight that day. E.g. , JA253. Having presented this

partially false chart, the prosecution interfered with the defense cross-examination

of Roizen through a series of frivolous objections. E.g. , JA243-44, 250-51, 255.

In the end, however, it became clear that Roizen had no basis for placing Kozeny

in Baku on February 5. E.g. , JA253-58. The Roizen gambit thus failed, and the

government then stipulated to the facts in the flight records near the end of its case.

JA260.



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Despite Bodmer's false testimony, the government continued to rely on his

claim to have told Bourke about the arrangement with the Azeris. It did not recall

Bodmer to explain the false dates or introduce other evidence on that point. It did

not even interview Bodmer to confront him with the false testimony. Instead, the

government waited until closing argument and then contended that the alleged

walk talk occurred after Bourke invested, at the grand opening of a Kozeny

company called Minaret in late April 1998--the only other time Bodmer and

Bourke were both in Baku. JA318-19, 343, 923.

The government's theory, advanced for the first time in closing argument,

that the walk talk occurred in April 1998--what it called the "April option,"

JA601--had no support in Bodmer's testimony or any other evidence. Bodmer

described the Minaret opening and surrounding events, including specific

conversations and meetings, but said nothing about a walk talk with Bourke.

JA130-43.

Bodmer's testimony contradicts the "April option" in two critical respects.

First, Bodmer testified (consistent with the prosecution's theory at the time) that

Bourke made his first investment "[a]bout two weeks" after the alleged walk talk.

JA127-28. But Bourke made that investment in mid-March 1998, more than a

month before the Minaret opening in April. It is inconceivable that Bodmer made



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an innocent mistake about the sequence of the walk talk and Bourke's investment,

given how important that timing was to the prosecution's case.

Second, Bodmer testified with certainty that the walk talk occurred on an

occasion when Evans accompanied Bourke to Baku. JA116-17, 125-26, 153-56.

He even claimed to have seen Bourke and Evans in the hotel breakfast room

together after the walk. JA122-23, 154. But Evans was not in Baku in April 1998,

and Bodmer never met him other than on the February 1998 Baku visit. JA126.

Bodmer's confident testimony about Evans' presence, designed to anchor the walk

talk to February 6 and thus establish the chronology that prosecutor Park

highlighted in opening, destroyed the "April option" that the government promoted

in closing argument.

Schmid's testimony further refutes the government's closing argument "April

option." Schmid (like Bodmer) testified before the defense exposed Bodmer's

story about the February 6 walk talk as false, when the government still sponsored

that version. The government thus wanted Schmid to corroborate the February 6

version, and he dutifully obliged. Schmid claimed that Bodmer told him about the

walk talk with Bourke at the "beginning of 1998," JA176-77, either "January or

February," JA206. That testimony supported Bodmer's February 6 version of the

walk talk but conflicts with the "April option." In addition, Schmid and Bodmer

both made clear that Schmid was not with Bodmer in Baku on the alleged walk



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talk trip. JA126-27, 177-78. But Schmid was with Bodmer at the Minaret opening

in April 1998--the only time he and Bodmer traveled to Baku together. JA130,

172-75. In this respect too Schmid's testimony refutes the "April option." 3 The

evidence thus leaves no doubt that the government invented the "April option" out

of whole cloth to try to salvage the key testimony of its cooperator.

The district court--echoing the government--concluded that "the flight

records merely show that Bodmer was mistaken about the date and time of the

'walk and talk.'" SA23. That is wrong. The Bodmer walk talk could only have

happened on two possible dates: February 6, 1998 or late April 1998. Those were

the only times Bourke and Bodmer were both in Baku after Kozeny made the

alleged "arrangement" with the Azeris. The flight records and Evans' diary and

testimony prove the walk talk did not occur in February 1998. The Bodmer and

Schmid testimony proves that it did not happen in April 1998. If the walk talk did

not happen in February 1998 or April 1998, the only two possible dates, then it did

3 Nor does the government's revised theory square with common sense. Onhis trip to the Minaret opening in April 1998, former Senator George Mitchell metPresident Aliyev and received his assurance that SOCAR would be privatized indue course. T.534-35, 1643-44, 1696-97. He and Bourke then met the President'sson Ilham--head of SOCAR--and received similar assurances. T.1645, 1697. It is

implausible that after receiving these assurances from the President and the head of SOCAR, Bourke would be so anxious about privatization that he would ask Bodmer about improper arrangements. The timing of Bourke's sole investment of his own money--March 1998--also refutes the "April option." It makes no sensethat Bourke would invest in March, before he learned of the alleged bribes(according to the false "April option"), but never invest his own money after helearned of the alleged bribes.



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not happen at all. Bodmer did not merely confuse the dates or other details of the

story he told. He fabricated the entire event. The district court's contrary

conclusion is at odds with the evidence and with common sense. It is also

incomplete, because it fails to take account of the five-year witness preparation of

Bodmer, conducted by lawyers with the relevant contradictory records at hand and

with their newly-revealed policy of letting witnesses testify falsely.

In addition to inventing the "April option" in closing, the prosecution

highlighted the "truth-telling" provision of Bodmer's plea agreement in its initial

and rebuttal closing arguments in an effort to buttress his credibility. It argued to

the jury that according to Bodmer and the government's other principal cooperator,

Thomas Farrell, "[I]f they lied or committed further crimes, their agreements

would get torn up, and . . . they would be stuck with their guilty pleas. . . . So you

should ask yourselves, why would they risk lying in court when they have

everything to lose? There is zero upside and a huge downside to lying." JA326. It

returned to this theme in rebuttal, after the defense had detailed the cooperators'

false testimony in its summation. AUSA Chernoff argued: "If these witnesses lie

on the stand or anywhere else with respect to this case, they lose their cooperation

agreements, but they cannot withdraw their guilty pleas." JA344. Contrary to

these arguments, nothing in the record suggests that the government has taken



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steps to revoke Bodmer's cooperation agreement, despite his false walk talk

testimony.

C. The Government's Position on Appeal.

Bourke exposed the fatal problems with the "April option" in his opening

brief to this Court on his initial appeal. Brief for Defendant-Appellant-Cross-

Appellee Frederic Bourke Jr., No. 09-4704-cr, at 11-15. In its response brief, the

government concocted a new theory. It suggested that "Bodmer was . . . mistaken

about consulting with Bourke and Kozeny on the day before the conversation with

Bourke about the corrupt arrangement," but that his testimony about meeting

Bourke on February 6 was otherwise correct despite conclusive evidence to the

contrary. JA655-56 n.*

The government's appellate theory was as false as the "April option" that the

defense discredited in the district court. Bodmer testified in detail about the

purported conversations with Bourke and Kozeny on February 5, the day before

the alleged February 6 walk talk with Bourke. He described the location of the

alleged conversations, the time of day, and what was said. He recalled others who

were present in Baku, including Evans. He remembered that the alleged walk talk

with Bourke occurred the next day. JA497-505, 530-32. It is entirely implausible

that Bodmer produced his richly detailed--and completely false--narrative about

the events of February 5 by "mistake." If a criminal defendant offered such an



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absurd defense in a perjury prosecution, the government would rightly ridicule it,

and the jury would swiftly reject it.

The government's "February 5 mistake" theory has another insurmountable

problem. The theory assumes that Bodmer's testimony about the walk talk with

Bourke on February 6 was correct, and only the February 5 portion was

"mistaken." But Bodmer's story about the February 6 walk talk is impossible in

light of the flight records and Evans' daily diary and testimony. Bourke was in the

air on Kozeny's plane, and not in Baku, at 8 a.m. on February 6, when Bodmer said

the walk occurred. JA587. Evans' diary and testimony show, beyond any dispute,

that Evans was with Bourke for the entire six hours they were in Baku on February

6; Bourke and Bodmer were never alone together. JA595. Thus, the government

could not salvage the February 6 walk talk even if it could plausibly explain

Bodmer's false testimony about February 5 as a "mistake"--which, of course, it

cannot. 4

Before the oral argument in this Court on February 10, 2011, defense

counsel believed, based on the prosecutors' assurances, that the prosecution had no

idea Bodmer's walk talk testimony was false until after he had left the stand, when

the defense called the flight records to the prosecutors' attention. At oral argument,

4 Even after Bourke demonstrated in his reply brief on appeal that thegovernment's "February 5 mistake" theory was impossible, the prosecutor advanced that theory at oral argument as a "plausible scenario." JA639.



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however, the government told a different story. In response to Bourke's argument

about Bodmer's false testimony, AUSA Chernoff made the following statement:

The dates with respect to Mr. Bodmer, I sort of am puzzled by Mr.Tigar's argument that because the government had the flight records,Mr. Bodmer should have been rehabilitated in his witness prep. Itwould have been utterly improper for us to show him the flightrecords to point out to him that his recollection of these meetings wasapparently flawed.

JA638-39. This statement by AUSA Chernoff suggested that the government

knew about the flight records during "witness prep" of Bodmer, but made a

deliberate decision not to "rehabilitate[]" him--that is, not to correct testimony the

prosecution knew (or should have known) to be false.

AUSA Chernoff made other misstatements about Bodmer at oral argument.

The prosecutor contended, for example, that "[t]he fact of the matter is that the

defendant was in Baku so many times personally overseeing this investment that it

is sort of understandable that the cooperators mixed up these dates years later."

JA637. Bourke was in Baku with Bodmer only twice after Kozeny allegedly began

bribing the Azeris and before Bourke and other investors discovered Kozenys

fraud--once on February 6, 1998 and again in late April 1998 at the Minaret

opening--not "many times," as the prosecutor asserted. The flight records and

Evans' diary and testimony prove that the walk talk did not happen on February 6.

And Bodmer's testimony--that Evans was present in Baku on the walk talk trip,

that Bourke invested two weeks later, and that Schmid was not in Baku when the



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conversation occurred--proves that it did not happen in April. Bodmer did not

"mix up" the only two times he and Bourke were together in Baku; the walk talk

did not happen on either of those visits.

D. The Government's Response to the Motion for New Trial.

Following AUSA Chernoff's statements at oral argument, Bourke filed the

motion for new trial that is the subject of this appeal. AUSA Chernoff alone

signed the government's opposition to Bourke's motion. Prosecutor Park was listed

as "of counsel" but did not sign the brief. JA658, 691. In the opposition, AUSA

Chernoff (who, as noted, had no involvement in preparing or presenting Bodmer's

testimony) asserted that "the Government was unaware--as was apparent from its

opening statement--that Kozeny's flight records were in conflict with aspects of

Bodmer's testimony." JA663. 5 AUSA Chernoff repeated this carefully hedged

defense throughout his opposition. E.g. , JA664, 667-68, 671-72, 681. But AUSA

Chernoff also maintained--as he had at oral argument before this Court--that it

would have been improper to show Bodmer the flight records before his testimony.

He declared that

5 AUSA Chernoff's assertion in his new trial opposition that the governmentwas unaware of the records in its own possession is somewhat at odds with his trial

position. During closing argument, defense counsel asked rhetorically what wouldhave happened if the defense had not located and followed up on the records.AUSA Chernoff objected: "There's no evidence the prosecution overlooked thoserecords. We offered them in our case." T.3185.



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even had the Government been aware of the flight records in preparing Bodmer to testify, the Government would not have shownthem to Bodmer because they were not his records and his simplyinaccurate recollection did not call for refreshing; instead, we wouldhave offered the records before Bodmer testified--and told the jury inour opening statement, rather than in our summation, that hisrecollection was obviously flawed in some respect.

JA668. In other words, according to AUSA Chernoff, the prosecution would have

presented Bodmer's false testimony, shown the jury the flight records, and left the

jury to make sense of the contradiction. What the prosecution would not have

done, and has not done to this day, is confront Bodmer and otherwise investigate to

determine whether and why the entire walk talk story is false --as it obviously is.

Why would the prosecutors not want to know? Isn't it the prosecutor's duty to seek

out the truth? Are they afraid of an inconvenient truth which would mean that

Bourke's hard won conviction might not survive?

At oral argument on the motion for new trial, AUSA Chernoff again spoke

for the government; prosecutor Park did not appear, purportedly because of "the

significant budgetary restraints of the Department of Justice is currently operating

under." JA896. 6 AUSA Chernoff took the same position as in his brief. He

6

Prosecutor Park, who gave the opening statement and conducted the directexaminations of Bodmer and Schmid, essentially disappeared from the case oncethe defense brought the flight records forward. Beginning with summer internDana Roizen's testimony--the point in the record when the prosecution firstacknowledged the existence of the flight records--Park occasionally appeared atcounsel table but did not utter a single word on the record for the remainder of thetrial or in any of the post-trial proceedings.



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insisted that "we" did not know about the flight records until the defense brought

them forward after Bodmer's testimony. JA881-81. To the district court's evident

astonishment, AUSA Chernoff then repeated his assertion that the government

could--and indeed should --present false testimony:

THE COURT: Why would that [showing Bodmer the flight records]have been improper? If you did know what he was telling you was alie, either intentional or mistaken, but a lie, false.

MR. CHERNOFF: Because first of all there is I think a big difference between mistaken and false.

THE COURT: Wait. This is why I really do want to finish thisthought. If you knew, and this is not the case according to you, buthypothetically had you known that the witness, your guy you put onthe stand, the government, is going to give testimony that is absolutelywrong, false, wrong, mistaken, intentional, whatever words you want,you know it is wrong because you have the contradictory proof infront of you, you still put that witness on to swear under oathsomething you know is false?

MR. CHERNOFF: If I am convinced that he believes he is telling thetruth--

THE COURT: You can't believe it. You have the contradictorydocument in your hand. You don't have any obligation?

MR. CHERNOFF: My obligation is to inform the jury of it, which iswhat we did.

THE COURT: But the government calls the witness and let's himtestify to a false statement knowing it is false that is really what youthink?

MR. CHERNOFF: If I coach him by showing him the records and hechanges his recollection, I don't think the truth-seeking process isserved by that. I understand the Court's perspective on this. Idiscussed this with a bunch of other prosecutors and whether I couldhave been permitted to show him the document, but no one has ever



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expressed a view to me I was wrong in my view that had I known of the document I should not show it to him and I should allow him to

persist in his error and bear that before the jury and say, You assesshis credibility.

THE COURT: You called him and I know it is false in myhypothetical. You are telling me you couldn't have known that or youwouldn't have opened that way, but had you known you can call awitness to testify to a fact that you know is false.

MR. CHERNOFF: Your Honor, I submit that happens all the time.There are witnesses who--let's say I put an eyewitness on to some kindof incident in the street and the way the eyewitness recalls the personthat she picked out of a line-up is wrong, I am going to put thatwitness up and explain to the jury that on this aspect of her testimonyshe is mistaken and they can decide to credit the rest of it whether she--

THE COURT: I am surprised at that position, to put on knowinglyfalse testimony surprises me.

JA882-84.

We address the facts further below.

SUMMARY OF THE ARGUMENT

1. It should be common ground that a federal prosecutor may never

present testimony to a jury that he knows or should know is materially false. It

should likewise be common ground that a prosecutor who knows or should know

that his witness intends to testify falsely must either convince the witness to correct

the falsehood or forego the testimony. The Supreme Court and this Court have so

held in case after case stretching back to Mooney v. Holohan , 294 U.S. 103 (1935).



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The prosecution here abandoned these principles. AUSA Chernoff insisted

that it would have been improper to confront Bodmer with the flight records during

witness preparation, even though no less an authority than the Restatement (Third)

of the Law Governing Lawyers recognizes this technique as proper. And AUSA

Chernoff takes the extraordinary position that when a prosecutor knows or should

know that a witness will testify falsely, he should present the false testimony

together with the contradicting evidence and leave it to the jury to resolve the

conflict.

That is not the law. This Court should say again, emphatically, that a

prosecutor may never present testimony he knows or should know is materially

false.

2. The district court refused to hold an evidentiary hearing on Bourke's

motion because it found, based on AUSA Chernoff's unsworn, hearsay assertions,

that the prosecutors neither knew nor should have known that Bodmer's walk talk

story was false. The court noted that it could imagine a "conceivable" innocent

explanation for the presentation of the false testimony.

The district court applied the wrong standard. There are significant factual

questions in the record that require a hearing at which at least Bodmer, the

cooperator, and Park, the prosecutor, testify. Park knew from his participation in

Bodmer's proffers in 2004 that Bodmer had difficulty identifying the date of the



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alleged walk talk. Park knew that Bodmer did not get his deal with the

government until he told the prosecutors that the walk talk occurred in February

1998--the date that fit the prosecutors' theory. It seems likely that Park was aware

of the flight records and Evans' diary, which disproved Bodmer's walk talk story

and which the prosecution obtained no later than January 2006, more than three

years before trial. And now we know the critical fact that AUSA Chernoff

disclosed, and then repeated under the district court's questioning: the prosecution

would present Bodmer's walk talk testimony (and not confront him with the

contradictory evidence in witness preparation or even after the falsity was exposed)

even if it knew that testimony was false. In light of these facts, a hearing is

essential to determine what Park knew or should have known and when.

3. Once it is determined--either on the existing record or after an

evidentiary hearing--that the prosecutors knew or should have known that

Bodmer's walk talk testimony was false, Bourke's conviction must be reversed "if

there is any reasonable likelihood that the false testimony could have affected the

judgment of the jury." United States v. Wallach , 935 F.2d 445, 456 (2d Cir. 1991)

(quotation omitted). The "reasonable likelihood" standard is easily satisfied here,

given the centrality of Bodmer's walk talk testimony to the case.

4. The district court concluded that the evidence Bourke presented in

support of his motion was not "newly discovered." That is incorrect. AUSA



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Chernoff's assertion in oral argument before this Court that it would have been

improper to confront Bodmer with the flight records during witness preparation

was newly discovered, as was his startling assertion in the district court that a

prosecutor may present false testimony (so long as the correct facts are also

presented).

These statements may be introduced against the government as admissions.

See, e.g., United States v. GAF Corp. , 928 F.2d 1253, 1259-61 (2d Cir. 1991);

United States v. McKeon , 738 F.2d 26 (2d Cir. 1984). AUSA Chernoff's

admissions undermine his rebuttal argument, based on the "truth-telling"

provisions of Bodmer's plea agreement, that "[i]f these witnesses [Bodmer and

Farrell] lie on the stand or anywhere else with respect to this case, they lose their

cooperation agreements, but they cannot withdraw their guilty pleas." JA344.

More generally, AUSA Chernoff's statements cast doubt on "the thoroughness and

even the good faith of the investigation" of Bourke. Kyles v. Whitley , 514 U.S.

419, 445 (1995).

ARGUMENT

I. PROSECUTORS ARE FORBIDDEN FROM PRESENTING

MATERIALLY FALSE TESTIMONY.The Supreme Court declared more than seventy-five years ago that obtaining

a conviction through the "deliberate deception of court and jury by the presentation

of testimony known to be perjured" is "inconsistent with the rudimentary demands



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of justice." Mooney v. Holohan , 294 U.S. 103, 112 (1935). In case after case since

Mooney , the Court has reaffirmed this bedrock principle. See, e.g., United States v.

Agurs , 427 U.S. 97, 103 (1976); Giglio v. United States , 405 U.S. 150, 153 (1972);

Napue v. Illinois , 360 U.S. 264, 269 (1959); Alcorta v. Texas , 355 U.S. 28 (1957).

This Court summarized these cases:

"Since at least 1935, it has been the established law of the UnitedStates that a conviction obtained through testimony the prosecutor knows to be false is repugnant to the Constitution. This is so because,in order to reduce the danger of false convictions, we rely on the

prosecutor not to be simply a party in litigation whose sole object isthe conviction of the defendant before him. The prosecutor is anofficer of the court whose duty is to present a forceful and truthfulcase to the jury, not to win at any cost."

Drake v. Portuondo , 553 F.3d 230, 240 (2d Cir. 2009) (quoting Wei Su v. Filion ,

335 F.3d 119, 126 (2d Cir. 2003)). As Judge (and former federal prosecutor)

Stephen Trott put it, prosecutors have a "clear duty under our Constitution" to

"collect potentially exculpatory evidence, to prevent fraud upon the court, and to

elicit the truth." Northern Mariana Islands v. Bowie , 243 F.3d 1109, 1117 (9th

Cir. 2001); see Stephen S. Trott, Words of Warning for Prosecutors Using

Criminals as Witnesses , 47 Hastings L.J. 1381 (1996).

In federal criminal cases such as this, the principle extends even further.

This Court has held that the prosecution violates a defendant's right to due process

when it presents testimony "that it knew or should have known was false." United

States v. Vozzella , 124 F.3d 389, 392 (2d Cir. 1997) (emphasis added); see Agurs ,



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427 U.S. at 103 ("knew or should have known"); United States v. Wallach , 935

F.2d 445, 456 (2d Cir. 1991) (same).

Wallach is instructive. In that case, the defense elicited testimony on cross-

examination of a key prosecution witness--Guariglia--from which the government

"should have been aware" that he had perjured himself when he denied gambling

during his cooperation. Id . at 457. Nonetheless, the government "sought to

rehabilitate the witness on redirect, permitting Guariglia to testify that he had

bought the chips but he had not gambled, even after defense counsel had disclosed

to the government written records from the Tropicana Casino reflecting that

Guariglia had gambled." Id. Although the government convinced this Court that it

had "questioned Guariglia extensively" about his trips to Atlantic City after the

defense discovered them, the Court was "not satisfied that the government properly

utilized the available information." Id . Reversing the convictions, this Court

declared that "instead of proceeding with great caution [after learning of

Guariglia's possible perjury], the government set out on its redirect examination to

rehabilitate Guariglia and elicited his rather dubious explanation of what had

happened. . . . We fear that given the importance of Guariglia's testimony to the

case, the prosecutors may have consciously avoided recognizing the obvious--that

is, that Guariglia was not telling the truth." Id .



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The conduct reflected in AUSA Chernoff's statements at oral argument here

and in the district court is at least as egregious as in Wallach . The prosecutors

either knew or should have known that Bodmer's February 6 walk talk testimony

was untrue. They made his false testimony the centerpiece of their opening

statement. They contended that Bodmer's time records and the Schmid

memorandum corroborated the false testimony. Unlike the prosecutors in Wallach ,

they did not question Bodmer "extensively"--or at all--about his false story once

the defense brought the flight records forward. 7 And rather than recall Bodmer,

they waited until the evidence was closed and then invented the false "April

option" in closing argument, foreclosing cross-examination about it.

AUSA Chernoff's assertion that it would have been "utterly improper" to

show Bodmer the flight records in "witness prep" is nonsense. There is nothing

improper in showing a witness documents in preparation to refresh his recollection,

7 Judge Altimari summarized the Wallach prosecutors' efforts to determinethe truth: "[I]n the midst of trial, the AUSAs extensively questioned Guarigliaabout the events in Atlantic City and the truthfulness of his testimony. Moreover,in an attempt to ascertain the truth or falsity of Guariglia's story, the AUSAslocated and interviewed Koplitz and another individual who was with Guariglia inAtlantic City. Both verified Guariglia's version of events. Additionally, the

prosecutors--albeit with limited success--attempted to contact and interview

Tropicana Casino officials. Thus, it seems to me that the AUSAs did all that wasreasonable to assure that they were neither relying on false testimony nor

permitting false testimony to go uncorrected." Wallach , 935 F.2d at 474 (Altimari,J., concurring). By contrast to the efforts (albeit inadequate) of the Wallach

prosecutors, these prosecutors appear to have made a conscious decision not toconfront Bodmer or otherwise investigate his false story after the defense broughtthe flight records forward at trial.



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especially when the documents show conclusively that he is wrong on a critical

point. See Restatement (Third) of the Law Governing Lawyers 116, comment b

(American Law Institute 2000) ("In preparing a witness to testify, a lawyer may

invite the witness to provide truthful testimony favorable to the lawyer's client.

Preparation consistent with the rule of this Section may include the following: . . .

revealing to the witness other testimony or evidence that will be presented and

asking the witness to reconsider the witness's recollection or recounting of events

in that light . . . .").

The best that can be said of Bourke's prosecutors is that they "consciously

avoided recognizing the obvious"--that Bodmer was lying about the walk talk. 8

Under these circumstances, the government violated Bourke's right to due process

under Wallach . As Judge Trott put it, the prosecution "f[ound] it tactically

advantageous to turn a blind eye to the manifest potential for malevolent

disinformation" that flowed from the "concerted effort by rewarded criminals" to

inculpate Bourke. Bowie , 243 F.3d at 1114.

The Seventh Circuit's decision in United States v. Freeman , 650 F.3d 673

(7th Cir. 2011), bears an uncanny resemblance to this case. A prosecution

cooperator (Williams) testified to a key meeting with the defendant (Wilbourn) in

8 It is ironic that in a case where Bourke was prosecuted in part on the theorythat he consciously avoided knowledge of Kozeny's alleged bribery, the

prosecutors have thus far escaped the consequences of presenting Bodmer's falsewalk talk testimony by consciously avoiding knowledge of the falsity.



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an apartment known as the "penthouse." Records in the prosecutors' possession

proved the meeting could not have occurred, because Wilbourn was in prison at the

time. The prosecutors objected to cross-examination designed to expose the false

testimony. After Williams left the stand, the prosecution stipulated that his

testimony about the meeting was wrong. But rather than recall Williams or

concede that the meeting did not occur at all, the prosecution invented a new story

in closing argument, claiming that the meeting had occurred a year earlier than

Williams had said. See id . at 676-78.

The district court granted a new trial in Freeman , see United States v.

Freeman , 2009 U.S. Dist. LEXIS 76973 (N.D. Ill. Aug. 26, 2009), and the Seventh

Circuit affirmed. It rejected the government's argument that "a claim under Napue

can only be made when it can be established that the witness is lying." Freeman ,

650 F.3d at 680. The court held instead that "[t]o uphold the granting of a new

trial, there does not need to be conclusive proof that the testimony was false or that

the witness could have been prosecuted for perjury; all that matters is that the

district court finds that the government has knowingly used false testimony." Id .

The court of appeals found that the government knew or should have known

that the cooperating witness' testimony was false. The prosecutors had records in

their possession before trial strongly suggesting that the meeting could not have

occurred as the witness claimed. The Seventh Circuit emphasized that "when the



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government learns that part of its case may be inaccurate, it must investigate"--a

responsibility the court found the government had "abdicated." Id . "Even more,"

the court declared in terms directly applicable here, "once the government finally

stipulated that Wilbourn was in prison the entire time the penthouse was used, that

meant the government knew Williams's testimony was false. Yet despite first

using and then admitting that Williams's testimony was false, the government

relied on it during closing arguments." Id .

Freeman strongly supports reversal here. As detailed above, the government

knew or consciously avoided knowledge before and during trial that Bodmer's

walk talk testimony was false. It made no effort to investigate the truthfulness of

that testimony, and it made the walk talk the centerpiece of its case. When the

defense exposed the falsity of the walk talk story during trial, the prosecution first

sought to portray Bodmer's testimony as a mistake, then interfered with the cross-

examination of Roizen, and only then, days after Bodmer left the stand, stipulated

to the facts that the travel records and Evans' diary and testimony proved. Even

then, the prosecution "abdicated"--it did not recall Bodmer or make any apparent

effort to investigate his false story. Instead, it made up the "April option" in

closing argument and urged the jury to accept that equally false story. Here, as in

Freeman , a new trial is necessary to remedy the prosecutorial misconduct.



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II. THE DISTRICT COURT SHOULD AT LEAST HAVE HELD ANEVIDENTIARY HEARING.

The district court denied Bourke's motion in part because it concluded--

based on AUSA Chernoff's unsworn, hearsay representations--that the government

neither knew nor should have known that Bodmer's walk talk testimony was false.

SA23. The court erred in reaching that conclusion, even on the existing record. 9

But it erred even more clearly in failing to hold an evidentiary hearing.

It should be clear, in the wake of the Stevens debacle and other recent cases

of prosecutorial misconduct, that federal courts rely at their peril on the unsworn

assurances of prosecutors that the government has done nothing wrong when the

record suggests otherwise. Without formal evidentiary proceedings, the egregious

wrongdoing in those cases would never have come to light. Similarly here,

without testimony from prosecutor Park and others involved in the preparation and

9 This Court reviews the district court's denial of a motion for new trial for abuse of discretion. "The district court abuses its discretion when it makes an error of law or when it makes a clearly erroneous finding of fact." Freeman , 650 F.3d at678-79. "Clear error review requires examination of factual findings to determinewhether the district court's account of the evidence is plausible in light of therecord viewed in its entirety. The reviewing court may reverse when, althoughthere is evidence to support the finding, on the entire evidence the court is left withthe definite and firm conviction that a mistake has been committed. A district

court's factual findings may be clearly erroneous where the court failed tosynthesize the evidence in a manner that accounts for conflicting evidence or thegaps in a party's evidentiary presentation; incorrectly assessed the probative valueof various pieces of evidence; or failed to weigh all of the relevant evidence beforemaking its factual findings." Drake , 553 F.3d at 239-240 (quotations, citations,ellipses, and brackets omitted).



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presentation of Bodmer's false testimony, the full extent of the prosecution's

knowledge cannot be known.

A. The Record Raises Significant Questions About the Prosecutors'Knowledge of Bodmer's False Walk Talk Story.

AUSA Chernoff's statements at oral argument in this Court and in the

district court leave little doubt that an evidentiary hearing is necessary to determine

what the prosecution--and especially prosecutor Park--knew or should have known

about Bodmer's false testimony. The evolution of Bodmer's walk talk story shortly

before his plea in 2004 and the prosecution's acquisition of the flight records and

Evans' diary no later than January 2006 further demonstrate the need for a hearing.

As far as the defense can determine from the Jencks material provided

shortly before trial, Bodmer settled on the date of the walk talk story during

meetings with prosecutor Park and others (but not AUSA Chernoff), between late

July 2004 and October 2004. By then, Bodmer had been detained for a full year.

He had been arrested in South Korea in August 2003 at the request of the United

States government. He had been imprisoned there for five months, until he was

sent to the United States. T.1181-82, 1327. Upon arrival in this country, he had

remained in jail in Manhattan for two weeks until, over the prosecution's objection,

he was released to house arrest near Washington, D.C. T.1182-82, 1327-28. He

had been on house arrest for many months, with little prospect of returning to his



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family and work in Switzerland. Unsurprisingly, with the aid of counsel he sought

to win his freedom by offering to cooperate against Bourke and others.

The prosecution tested Bodmer's worth as a cooperator several times during

2004, beginning in March and culminating in a multi-day proffer session in late

July and early August. 10 On March 29, 2004, notes indicate that Bodmer identified

the walk talk as having occurred on a "crisp" and "nice" day in the "spring."

Bodmer mentioned getting Kozeny's permission to tell about the arrangement with

the Azeris. He mentioned the presence of Evans. JA931-33. On July 27, 2004, at

what appears to be the first day of the proffer session, Bodmer said the walk talk

happened at the Minaret opening in April 1998. He again mentioned getting

Kozeny's approval, but this time he apparently did not mention Evans. Prosecutor

Park was present; AUSA Chernoff was not. JA735-36, 931-34. 11 As noted above,

the Minaret opening occurred after Bourke had first invested. Thus, Bodmer's

initial proffered version of the walk talk did not fit the government's theory that

Bourke invested with knowledge of a corrupt arrangement.

In a continuation of the proffer on August 2, 2004, Bodmer again said the

10 Bourke presented a chart to the district court summarizing pertinent portions of the Bodmer Jencks material. The chart appears at JA931-34. It showsa five-year witness preparation process, and the step-by-careful-step way in whichthe prosecutors moved Bodmer to his fulsome and utterly false version of events.The chart also references Bodmer's own notes of the creative process.

11 Although the notes of the interview are undated, they refer to Bodmer's proffer agreement, which he signed July 27, 2004.



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Bourke walk talk happened in April 1998, before the office opening parties. Again

he claimed to have obtained Kozeny's approval and did not mention Evans'

presence. Prosecutor Park was again present; AUSA Chernoff was not. JA750-52,

931-34.

Something then caused Bodmer to change his story. On August 4, 2004--the

final day of the proffer session--handwritten notes contain the following under the

heading "clarifications": "? re timing of Bourke disclosure could be Feb 98, not

April office opening '98 2-6/7-98 because discussion preceded investment same

sequence of the discussion". JA759.

Bodmer's revised story had the desired effect. On October 8, 2004,

apparently without a further proffer session, he signed his plea and cooperation

agreement. JA764. Soon afterward, he pled guilty under the agreement to money

laundering conspiracy. 12 In his first post-plea interview, in late October 2004,

Bodmer told the version of the walk talk story that fit the prosecution's theory of

the case. He claimed the walk talk occurred in February 1998, when Evans was

present in Baku, before Bourke invested , and he described seeking Kozeny's

permission to discuss the investment with Bourke the day before the walk talk.

12 Bodmer's Swiss attorney, in a statement explaining Bodmer's guilty pleato Swiss authorities, stated that "the result [the guilty plea] probably would have

been different" if Bodmer had been a United States citizen and thus able to "movefreely in his own home country and to continue his work." T.1338-39; DX U-13.T. 952, 1194-95, 1338-43.



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JA693. Only then, more than a year after his arrest, was Bodmer permitted to

return to Switzerland, where he has spent the last seven plus years practicing law

and traveling the globe with the government's unstinting permission. T.954-55,

1329-32.

The Bodmer Jencks materials from July 2004 through October 2004 thus

appear to show that Bodmer was trying to pick a date for the walk talk story and

that prosecutor Park was fully aware that the date was in question. Those materials

also show that Bodmer did not get his deal until he settled on the date that fit the

prosecution's theory.

No later than January 27, 2006--just over a year after the discussions with

Bodmer caused him to switch the date of the alleged walk talk from April 1998 to

February 1998--the prosecution obtained the Kozeny flight records from Universal

Weather & Aviation and the Evans daily diary from Evans. JA756, 782. 13 As

discussed above, those records clearly prove the falsity of the walk talk story.

The prosecution did not come into possession of the flight records and the

Evans diary by accident; it either obtained them by grand jury subpoena or

otherwise specifically requested them. And having requested and obtained the

13 The government's cover letter producing these materials to the defense isdated January 27, 2006. How long before that date the government obtained therecords is unknown at this point. It bears noting, though, that cooperating witnessJohn Pulley advised the government on July 2, 2002 about the existence of "aviation records out of houston." JA784.



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documents, someone on the prosecution team must have reviewed them. The

knowledge of that member (or members) of the prosecution team is attributable to

the team as a whole. See, e.g., Kyles v. Whitley , 514 U.S. 419, 438 (1995)

(knowledge of police investigator attributable to prosecutor for purposes of Brady );

Giglio v. United States , 405 U.S. 150, 154 (1972) ("[T]he prosecutor's office is an

entity and as such it is the spokesman for the Government.").

B. An Evidentiary Hearing Is Necessary.

What happened after the prosecutor's office reviewed the flight records?

Did prosecutor Park decide to let Bodmer tell his false story and hope the defense

would not locate or realize the significance of the records and Evans' diary amid

the thousands of pages of discovery in the brief, hectic period between the last-

minute Jencks disclosure and the Bodmer cross-examination? 14 Did Park, knowing

that Bodmer had waffled initially on the date of the alleged walk talk, make a

conscious decision to avoid learning contradictory information? Did someone on

the prosecution team confront Bodmer with the records, in an interview not

reflected in the Jencks material?

Given the intensity with which the prosecutors investigated comparatively

trivial aspects of the case--the exhaustive recounting at trial of one Azeri official's

14 The Bodmer Jencks materials, including his pretrial statements to prosecutors and the FBI, were not produced to Bourke's defense counsel until twodays before the trial began. JA720.



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purchases during a trip to New York comes to mind, obsessively documented with

credit card receipts, hotel invoices, and travel records--it is hard to imagine that

they did not devote substantial resources to the flight records, which destroyed a

cornerstone of their case. Was there such an investigation? What did it reveal?

Why were the results not produced to the defense? And if, contrary to reason and

common sense, the prosecutors elected not to follow up on the flight records and

Evans' diary, that smacks of an effort, as in Wallach , to "consciously avoid[]

recognizing the obvious." 935 F.2d at 457; see, e.g., Vozzella , 124 F.3d at 392

(noting that "whatever ignorance the government had about the veracity of the rest

of the records was willful"; having learned the "unwelcome fact" that a portion of

the records was false, the government "simply ceased further inquiry").

The district court concluded that "[t]he flight records are difficult to read and

interpret. It is conceivable that the Government did not cross-check the details of

Bodmer's anticipated testimony against these difficult to decipher flight records."

SA23. But this apologia for the prosecution is wrong. The flight records are not

"difficult to read and interpret." Summer intern Roizen managed to read and

understand them in short order when asked to do so. E.g. , JA246-52. Any

uncertainty could have been resolved swiftly by a call to Universal Aviation &

Weather in Houston. And the question in any event is not whether the district

court can imagine (without an evidentiary record) a "conceivable" innocent



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explanation for the prosecution's presentation of false testimony. The question is

what actually happened when the prosecution obtained flight records and Evans

diary entries that proved Bodmer's story was false.

The time-tested way of answering such factual questions is an evidentiary

hearing. That is how, for example, the Supreme Court directed the Subversive

Activities Control Board to resolve allegations of witness perjury. See Communist

Party of United States v. SACB , 351 U.S. 115, 124-25 (1956) (SACB can either

hold a hearing on the perjury or expunge the witness' challenged testimony and

reconsider record). That is how Brady claims are "[n]ormally . . . assessed" in the

post-trial context. United States v. Mitchell , 365 F.3d 215, 255 (3d Cir. 2004).

That is how factual issues involving the circumstances of unlawful surveillance are

resolved. See, e.g., Roberts v. United States , 389 U.S. 18 (1967) (per curiam).

That is how courts determine whether a government affiant knowingly or

recklessly included false information in a search warrant affidavit. See Franks v.

Delaware , 438 U.S. 154, 169 (1978). That is how the government's fraud on the

court was laid bare in Demjanjuk v. Petrovsky , 10 F.3d 338 (6th Cir. 1993). That is

how the now-notorious prosecutorial misconduct was fully exposed in the

prosecution of Senator Stevens in the District of Columbia and in the Broadcom

prosecution in the Central District of California. That is how this Court expected

that a habeas claim involving presentation of perjured testimony would be



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developed. See Drake v. Portuondo , 321 F.3d 338, 345-46 (2d Cir. 2003). And

that is how the serious factual questions here about how Bodmer came to give false

testimony to convict a distinguished American citizen--questions that go to the

heart of the integrity of the judicial system--should be resolved. This is

emphatically not a case where "the moving papers themselves disclosed the

inadequacies of the defendants' case, and the opportunity to present live witnesses

would clearly have been unavailing." United States v. Helmsley , 985 F.2d 1202,

1210 (2d Cir. 1993) (quotation omitted).

The district court erred in relying on the unsworn, hearsay assertions of

AUSA Chernoff, who had little or no involvement in the underlying events, and

hypothesizing a purportedly "conceivable" explanation for the prosecutors'

presentation of false testimony. To make reliable factual findings, the district court

needed to hear from people with personal knowledge--and, in particular, from

prosecutor Park, whom the government has taken such care to shield from inquiry,

and from Bodmer, who--remarkably--the government claims to have never

questioned about his false trial testimony.

The need for an evidentiary hearing is underscored by the evidence that

government lawyers are willing to disregard their ethical and legal duty, and have

made inconsistent and palpably incorrect statements in the course of these

proceedings. United States v. McKeon , 738 F.2d 26 (2d Cir. 1984), teaches a



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powerful lesson here. In that case, a lawyer's inconsistent statements dictated that

he "ought" to be a witness if his adversary wanted to call him--and it did. Id . at 29

(quoting disciplinary rule). This result was mandated as a prophylactic measure

against "sharp practice." Id . at 31. In this case, the government's shifting versions-

-coupled finally with the assertion that the prosecutors could present false

testimony if they wished to do so--calls for government lawyers to take the stand

and explain.

The government's position here has veered from one version to another as

expediency has dictated, from assurance that the walk talk took place, through

Bodmer's testimony, Roizen's erroneous chart, and finally a stipulation. Yet,

during final argument, AUSA Chernoff objected that "[t]here's no evidence the

prosecution overlooked [the flight] records" that showed Bodmer's testimony could

not be accurate. T.3185. And then in his brief to this Court on Bourke's initial

appeal, AUSA Chernoff returned to the earlier stance that the government was

"unaware" of the flight records. By this device, he combined contradiction with

dissembling: the government had the flight records all along. And even though the

prosecution showed intense ability to track the activities of witnesses and parties

with respect to all the other trial participants, the prosecutors claimed that they had

at most made an understandable mistake.



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Finally, AUSA Chernoff announced that the government had a policy of

presenting false testimony. This revelation put the entire matter in a new light.

The explanation, if any there be, can only come from the self-contradicting and

legally incorrect prosecutors--who, as this Court has put it, "ought" to be witnesses.

III. THE PROSECUTORS' PRESENTATION OF BODMER'S FALSEWALK TALK TESTIMONY REQUIRES REVERSAL.

Once it is determined--either on the existing record or after an evidentiary

hearing--that the prosecutors knew or should have known that Bodmer's testimony

was false, reversal is almost automatic: "[T]he conviction must be set aside if there

is any reasonable likelihood that the false testimony could have affected the

judgment of the jury." Wallach , 935 F.2d at 456 (quotation omitted); see Agurs ,

427 U.S. at 103; Freeman , 650 F.3d at 681; Vozzella , 124 F.3d at 392.

The "reasonable likelihood" standard is easily satisfied here. Bodmer's false

February 5 and 6 testimony was the centerpiece of the prosecution's case from

opening statement on. Prosecutor Park carefully buttressed that testimony on

direct with Bodmer's time records. The government called Schmid and introduced

his redacted memorandum as further support for the false story. Even when the

government was forced to stipulate that the testimony was wrong near the end of

its case, it did not renounce Bodmer's account of his conversation with Bourke.

Instead, it concocted the "April option" in closing argument--too late for Bourke to

cross-examine Bodmer about it--and maintained that Bodmer had simply been



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long as the correct facts are also presented) is newly discovered.

Until AUSA Chernoff's statements, defense counsel had accepted the

prosecutors' representations that they knew nothing about the flight records (or,

presumably, Evans' diary) until the defense brought them forward after Bodmer's

testimony. Counsel relied on those representations in part because in a pretrial

proceeding involving another government cooperator, the district court declared,

"Clearly if the government is aware that a witness has lied to it, it has to disclose

that. Surely Mr. Chernoff knows that. So if the government is aware that the

witness has made a false statement, Mr. Chernoff, do you agree if you're aware of

that you would have to make it known as Brady?", and AUSA Chernoff responded:

"I think we would normally consider that Giglio. But there is no such false

statement that we are aware of." CA2. Defense counsel are "entitled to treat the

prosecutors' submissions as truthful." Banks v. Dretke , 540 U.S. 668, 698 (2004).

Once AUSA Chernoff made his remarks in oral argument to this Court indicating

that the prosecutors did know that Bodmer's testimony was false but presented it

anyway, the defense was bound to act diligently--and it did so, by filing the motion

for new trial.

AUSA Chernoff's statements thus explain why defense counsel sought the

new trial after the oral argument in this Court, rather than immediately following

the verdict. But those statements have substantial probative force for other



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reasons. Under this Court's cases, the defense may treat AUSA Chernoff's

statements as admissions. See, e.g., United States v. GAF Corp. , 928 F.2d 1253,

1259-61 (2d Cir. 1991); see also McKeon , 738 F.2d at 30-34 (opposing party may

treat lawyer's statement as party admission). AUSA Chernoff's admissions directly

undermine his rebuttal argument, based on the "truth-telling" provisions of

Bodmer's plea agreement, that "[i]f these witnesses [Bodmer and Farrell] lie on the

stand or anywhere else with respect to this case, they lose their cooperation

agreements, but they cannot withdraw their guilty pleas." JA344; see also JA326-

27 (similar argument in first prosecution closing). That powerful argument, central

to the effort to rehabilitate Bodmer in the jury's eyes following a sustained defense

attack, was completely untrue in light of what we now know about AUSA

Chernoff's willingness to present false testimony. We now know, thanks to AUSA

Chernoff's statements, that Bodmer will suffer no loss of the benefits of his

agreement for testifying falsely. And we know that the entire premise of the

"truth-telling" provision--that the prosecution will present only truthful testimony

from the cooperating witness--is hollow. The jury needed to know those facts in

assessing Bodmer's credibility and evaluating AUSA Chernoff's argument. See

Wallach , 935 F.2d at 459 (prosecutor's reliance in closing on similar provision to

buttress credibility of witness who testified falsely "provide[s] one more reason to

set aside the jury's verdict").



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More generally, AUSA Chernoff's willingness to present false testimony

undermines the integrity of the entire prosecution case, and particularly its reliance

on Bodmer and his fellow cooperator Thomas Farrell. As the Supreme Court has

recognized, "[W]hen . . . the probative force of evidence depends on the

circumstances in which it was obtained and those circumstances raise a possibility

of fraud, indications of conscientious police work will enhance probative force and

slovenly work will diminish it." Kyles , 514 U.S. at 446 n.15; see id. at 442 n.13

(noting the value to the defense of demonstrating that government investigation

was "shoddy"); United States v. Sager , 227 F.3d 1138, 1145-46 (9th Cir. 2000)

(same); Trott, supra , 47 Hastings L.J. at 1417-18 (same). If the defense had known

that the prosecutors had a practice of not confronting their cooperators with

contrary evidence and that the prosecutors were willing to present false testimony

(as long as the conflicting evidence was also presented), it could have powerfully

attacked "the thoroughness and even the good faith of the investigation" of Bourke.

Kyles , 514 U.S. at 445. AUSA Chernoff's statements would have conveyed to the

jury, at best, "a remarkably uncritical attitude on the part of the" prosecutors--an

attitude directly in conflict with the truth-telling provision of the Bodmer

cooperation agreement. Id . As the Supreme Court recognized in Kyles , such

evidence forms the basis for a powerful and legitimate defense attack on the

prosecution case. See id . at 445-47.



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AUSA Chernoff's statements at oral argument before this Court and in the

district court were "newly discovered"; they were "evidence," as GAF Corp. and

McKeon confirm; and they powerfully undermine Bodmer's testimony and the

remainder of the prosecution case. Due process demands that once false testimony

is discovered, even during trial, the prosecution has a duty to confront its

cooperator and ascertain the truth. AUSA Chernoffs statement that this would

somehow be highly improper demands a forceful admonition and reversal.

CONCLUSION

For the foregoing reasons, the Court should reverse Bourke's conviction and

order a new trial or, in the alternative, remand for an evidentiary hearing on

Bourke's new trial motion.

DATED: April 10, 2012

Case: 11-5390 Document: 25 Page: 52 04/10/2012 57606

Bourke Appeal

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Transcript of Bourke Appeal