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Case: 11-5442 Document: 46 Page: 1 08/13/2012 690322 38

11-5442(L)
12-389(CON)
To Be Argued By:
MARCIA S. COHEN

United States Court of Appeals
FOR THE SECOND CIRCUIT

Docket Nos. 11-5442(L), 12-389(CON)

UNITED STATES OF AMERICA,
Appellee,
—v.—

CHRISTIAN T. VIERTEL,
Defendant-Appellant.

ON APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF NEW YORK

BRIEF FOR THE UNITED STATES OF AMERICA

PREET BHARARA,
United States Attorney for the
Southern District of New York,
Attorney for the United States
of America.
MARCIA S. COHEN,
KATHERINE POLK FAILLA,
Assistant United States Attorneys,
Of Counsel.
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TABLE OF CONTENTS
PAGE

Preliminary Statement. . . . . . . . . . . . . . . . . . . . . . . . . . 1
Statement of Facts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
A. The Pretrial Procedural History. . . . . . . . . . . . . . 6
B. The Trial Against Viertel. . . . . . . . . . . . . . . . . . . 7
1. The Government’s Case. . . . . . . . . . . . . . . . . 7
a. The Fraudulent Scheme.. . . . . . . . . . . . . . 7
b. The Use of the Mails and the
Wires to Further the Scheme. . . . . . . . . . 11
2. The Defense Case. . . . . . . . . . . . . . . . . . . . . 11
3. The Defendant’s Rule 29 Motion. . . . . . . . . 12
C. Viertel’s Sentencing. . . . . . . . . . . . . . . . . . . . . . 14
D. Viertel’s Direct Appeal and Crosby Remand.. . 15
E. Viertel’s Post-Conviction Litigation and
Second Appeal. . . . . . . . . . . . . . . . . . . . . . . . . . 15
1. Viertel’s First Motion for a New Trial. . . . . 15
2. Viertel’s Motion for Resentencing. . . . . . . . 18
3. Viertel’s Second Appeal. . . . . . . . . . . . . . . . 19
F. Viertel’s Second Motion for a New Trial and
Third Appeal.. . . . . . . . . . . . . . . . . . . . . . . . . . . 20
1. The Brady Claim.. . . . . . . . . . . . . . . . . . . . . 20
2. The Restitution Claim. . . . . . . . . . . . . . . . . . 23
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ii
PAGE

ARGUMENT:
The District Court Properly Denied Viertel’s Second
Motion for a New Trial. . . . . . . . . . . . . . . . . . . . . . 24
A. Applicable Law. . . . . . . . . . . . . . . . . . . . . . . . . 25
1. Suppression and Materiality Under
Brady.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2. Fed. R. Crim P. 33. . . . . . . . . . . . . . . . . . . . 27
B. Discussion.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
CONCLUSION.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

TABLE OF AUTHORITIES
Cases:
Brady v. Maryland,
373 U.S. 83 (1963).. . . . . . . . . . . . . . . . . . . . . . . . 25
Giglio v. United States,
405 U.S. 150 (1972).. . . . . . . . . . . . . . . . . . . . . . . 25
Kyles v. Whitley,
514 U.S. 419 (1995).. . . . . . . . . . . . . . . . . . . . . . . 26
Leka v. Portuondo,
257 F.3d 89 (2d Cir. 2001).. . . . . . . . . . . . . . . . . . 27
Strickler v. Greene,
527 U.S. 263 (1999).. . . . . . . . . . . . . . . . . . . . . . . 27
United States v. Bagley,
473 U.S. 667 (1985).. . . . . . . . . . . . . . . . . . . . . . . 26
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iii
PAGE

United States v. Coppa,
267 F.3d 132 (2d Cir. 2001).. . . . . . . . . . . . . . . . . 26
United States v. Douglas,
525 F.3d 225 (2d Cir. 2008).. . . . . . . . . . . . . . . . . 27
United States v. Middlemiss,
217 F.3d 112 (2d Cir. 2000).. . . . . . . . . . . . . . . . . 26
United States v. Orena,
145 F.3d 551 (2d Cir. 1998).. . . . . . . . . . . . . . 27, 30
United States v. Payne,
63 F.3d 1200 (2d Cir. 1995).. . . . . . . . . . . . . . . . . 27
United States v. Rigas,
583 F.3d 108 (2d Cir. 2009).. . . . . . . . . . . . . . . . . 28
United States v. Rivas,
377 F.3d 195 (2d Cir. 2004).. . . . . . . . . . . . . . . . . 26
United States v. Sasso,
59 F.3d 341 (2d Cir. 1995).. . . . . . . . . . . . . . . . . . 28
United States v. Spinelli,
551 F.3d 159 (2d Cir. 2008).. . . . . . . . . . . . . . . . . 26
United States v. Stewart,
433 F.3d 273 (2d Cir. 2006).. . . . . . . . . . . . . . . . . 28
United States v. Viertel,
98 Fed. Appx. 68 (2d Cir. 2004). . . . . . . . . . . . 2, 15
United States v. Viertel,
242 Fed. Appx. 779 (2d Cir. 2007).. . . . . . . . . 3, 19
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iv
PAGE

United States v. Viertel,
No. 01 Cr. 572, 2005 WL 1053434
(S.D.N.Y. May 5, 2005).. . . . . . . . . . . . . . . . . . . . . 3
United States v. Viertel,
No. 01 Cr. 572, 2005 WL 1844774
(S.D.N.Y. Aug. 3, 2005). . . . . . . . . . . . . . . . . . . . . 3
Viertel v. United States,
No. 08 Civ. 7512, 2009 WL 22863
(S.D.N.Y. Jan. 5, 2009). . . . . . . . . . . . . . . . . . . . . . 4
Viertel v. United States,
No. 09-0926-pr.. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Viertel v. United States,
No. 12-231. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Viertel v. United States,
No. 12-2560. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Statutes, Rules & Other Authorities:
Fed. R. Crim P. 33. . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
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FOR THE SECOND CIRCUIT

Docket Nos. 11-5442(L), 12-389(CON)

UNITED STATES OF AMERICA,
Appellee,
-v.-

CHRISTIAN T. VIERTEL,
Defendant-Appellant.

BRIEF FOR THE UNITED STATES OF AMERICA

Preliminary Statement
Christian T. Viertel appeals from two orders entered in
the United States District Court for the Southern District
of New York by the Honorable John G. Koeltl, United
States District Judge. In the first order, entered on May 1,
2008, the District Court denied Viertel’s motion for a new
trial pursuant to Rule 33 of the Federal Rules of Criminal
Procedure; in the second order, entered on January 9,
2012, the Court denied Viertel’s request for an order
vacating, nunc pro tunc, various adjudications the Court
had previously made concerning loss and restitution.
Indictment S2 01 Cr. 571 (JGK) (the “S2 Indictment”)
was filed on June 6, 2002, in eight counts, of which three
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pertained to Viertel. Count One charged that Viertel
participated in a conspiracy to commit mail and wire
fraud, in violation of Title 18, United States Code, Section
371. Count Seven charged that Viertel committed the
substantive offense of wire fraud, in violation of Title 18,
United States Code, Sections 1343, 1346, and 2. Count
Eight charged that Viertel committed the substantive
offense of mail fraud, in violation of Title 18, United
States Code, Sections 1341, 1346, and 2.
Trial commenced on September 12, 2002, and ended
on October 12, 2002, when Viertel was convicted on all
three counts of the S2 Indictment. On June 23, 2003,
Judge Koeltl sentenced Viertel to concurrent terms of 21
months’ imprisonment, which he ordered to be followed
by concurrent terms of three years’ supervised release.
Judge Koeltl also imposed restitution in the amount of
$345,673.96, and a $300 mandatory special assessment.
Viertel appealed from his conviction. On May 28,
2004, this Court affirmed Viertel’s conviction by summary
order. See United States v. Viertel, 98 Fed. Appx. 68 (2d
Cir. 2004). Viertel filed a petition for rehearing on June
14, 2004, which petition was denied by this Court on June
21, 2004. Notwithstanding this decision, the Court did not
immediately issue a mandate.
On September 12, 2004, Viertel filed a motion in the
District Court for a new trial, pursuant to Federal Rule of
Criminal Procedure 33, citing purportedly newly discov-
ered evidence. While that motion was pending, on April
13, 2005, this Court remanded the case to the District
Court to consider whether to resentence Viertel pursuant
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to the procedures established in United States v. Crosby,
397 F.3d 103 (2d Cir. 2005).
On May 4, 2005, the District Court denied Viertel’s
new trial motion. See United States v. Viertel, No. 01 Cr.
572, 2005 WL 1053434 (S.D.N.Y. May 5, 2005). On May
13, 2005, Viertel completed his sentence of imprisonment.
Shortly thereafter, Viertel was deported from the United
States to Germany. On August 3, 2005, the District Court
denied Viertel’s motion for resentencing. See United
States v. Viertel, No. 01 Cr. 572, 2005 WL 1844774
(S.D.N.Y. Aug. 3, 2005).
Viertel appealed from the District Court’s denial of his
motions for a new trial and for resentencing. On Septem-
ber 26, 2007, this Court affirmed both decisions of the
District Court by summary order. See United States v.
Viertel, 242 Fed. Appx. 779 (2d Cir. 2007).
On October 2, 2007, Viertel filed a second motion for
a new trial in the District Court, this time claiming that the
Government had withheld material exculpatory evidence
in violation of its obligations under Brady v. Maryland,
373 U.S. 83 (1963); in the same motion, Viertel requested
cancellation of all of his restitution obligations. On April
29, 2008, the District Court denied Viertel’s motion for a
new trial and referred to a Magistrate Judge the determina-
tion of the amount of restitution that remained outstanding.
Viertel appealed from the District Court’s decision
denying his new trial motion.*

*
This appeal, initially docketed in this Court as 08-
3039-cr, was later renumbered as 11-5442. The Court
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On December 23, 2011, the Government advised the
District Court that the Government had no objection to the
Court deeming the balance of Viertel’s restitution obliga-
tion satisfied. Accordingly, the Court entered an order to
that effect. On December 27, 2011, Viertel filed a “Motion
for VACATUR nunc pro tunc of a catalogue of erroneous
adjudications concerning ‘Loss’ Restitution issues by
phantom victims and bogus lien recordings grounded upon
the government’s extremely unpunctual admission that
restitution was satisfied” (the “Vacatur Motion”). The
District Court denied this motion by order dated January
6, 2012. Following the entry of this order, Viertel filed
another notice of appeal, which this Court docketed as 12-
389.*

appointed counsel for Viertel, who requested that the
appeal be held in abeyance until the District Court re-
solved the issue of restitution. This Court granted this
request, and the appeal was later consolidated with the
appeal docketed as 12-389.
*
The defendant has had and continues to have
appeals in this Court stemming from his continued
efforts — in spite of obvious procedural bars — to obtain
vacatur of his conviction. On April 15, 2008, Viertel filed
a motion to vacate, set aside, or correct his sentence,
pursuant to Title 28, United States Code, Section 2255;
Viertel also styled the motion as a request for a writ of
error coram nobis. On January 5, 2009, the District Court
denied Viertel’s motion and declined to issue a certificate
of appealability. See Viertel v. United States, No. 08 Civ.
7512, 2009 WL 22863 (S.D.N.Y. Jan. 5, 2009). On
November 4, 2009, this Court denied Viertel’s motion for
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a certificate of appealability from the District Court’s
order. See Viertel v. United States, No. 09-0926-pr.
On December 31, 2011, Viertel filed a motion in
the District Court styled as “Vacatur of Judgement of
Conviction grounded upon ab ovo deficit of interstate
[1341] jurisdiction over international deliverances [via air
cargo export], divesting Federal Courts of adjudicatory
powers [ex parte].” The District Court construed this
motion as a second or successive motion pursuant to
Section 2255, and, by order dated January 9, 2012, trans-
ferred the case to this Court for a determination of whether
the defendant could proceed with his motion. Viertel filed
a motion challenging the District Court’s transfer order.
See Viertel v. United States, No. 12-231. On April 2, 2012,
this Court issued an Order (1) deferring a decision on
Viertel’s motion pending resolution of the instant appeal,
and (2) directing the Government to address “whether
Viertel satisfies § 2255’s ‘in custody’ requirement in
connection with his 2003 conviction for mail fraud, wire
fraud, and conspiracy to commit mail and wire fraud.” The
Government responded by filing opposition papers to
Viertel’s motion on April 26, 2012.
On April 20, 2012, Viertel moved in the District
Court “for an expedited writ of Vacatur and Missio of a
Judgment of Conviction,” again claiming purported
jurisdictional defects in his counts of conviction. On May
8, 2012, the District Court issued an opinion denying
Viertel’s motion, and on May 22, 2012, it denied Viertel’s
motion for reconsideration of its prior decision. Viertel
appealed from the District Court’s decision, and his appeal
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Statement of Facts
A. The Pretrial Procedural History
Indictment 01 Cr. 571 (JGK), filed on June 14, 2001,
charged Viertel and two co-defendants, Fritz Blumenberg
and John Lee, in three counts. (A. 3, Docket Entry 1).*
Count One alleged that Blumenberg, Lee, and Viertel
conspired to commit mail and wire fraud in connection
with the submission of false invoices to Burda Media, Inc.
(“Burda Media”). Counts Two and Three charged Blumen-
berg, Lee, and Viertel with the substantive crimes of mail
and wire fraud in connection with the false invoice
scheme.
Superseding Indictment S1 01 Cr. 571 (JGK) (the “S1
Indictment”) was filed on February 14, 2002. In addition
to the three counts charged in the underlying indictment,
the S1 Indictment charged Blumenberg with two counts of
tax evasion. (A. 6, Docket Entry 25). On April 5, 2002,
Blumenberg pled guilty to the charges in the S1 Indict-
ment.

is pending before this Court. See Viertel v. United States,
No. 12-2560.
*
“A.” refers to the appendix filed with the defen-
dant’s brief on appeal; “Br.” refers to the defendant’s brief
on appeal; “Tr.” refers to the trial transcript; “GX” refers
to a Government exhibits introduced at trial; and “[Date]
Tr.” refers to the transcript of proceedings occurring on
the specified date in the District Court.
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On June 6, 2002, Indictment S2 01 Cr. 571 (JGK) was
filed in eight counts, of which three pertained to Viertel.
(A. 35-50). Count One charged that Viertel participated in
a conspiracy to commit mail and wire fraud. (A. 35-42).
Counts Seven and Eight charged that Viertel committed
the substantive offenses of mail and wire fraud. (A. 48-
50).* On July 3, 2002, the Government entered a nolle
prosequi as to co-defendant Lee. On September 12, 2002,
trial commenced against Viertel alone.
B. The Trial Against Viertel**
1. The Government’s Case
a. The Fraudulent Scheme
The Government’s evidence at trial conclusively
established that between 1992 and 1996, Blumenberg and
Viertel perpetrated a massive fraud on Blumenberg’s
employer, Burda Media, and on Burda Media’s German
parent corporation, Burda Holding. During the relevant
time period, Blumenberg was the President of Burda
Media; Viertel, unaffiliated with Burda Media, was
Blumenberg’s longtime friend.

*
At trial, Count Seven was renumbered as Count
Two and Count Eight was renumbered as Count Three.
**
A more detailed summary of the evidence at trial is
contained in the Government’s briefs on appeal in United
States v. Lee (Viertel), No. 03-1364 (filed March 24,
2004), and United States v. Viertel, No. 05-5012 (filed
August 18, 2006), to which this Court is respectfully
referred.
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The fraud — which capitalized on the manner in which
Burda Media and Burda Holding reimbursed outside
vendors — involved Blumenberg submitting to Burda
Media hundreds of fraudulent invoices for services
purportedly performed by various sham companies. Burda
Media paid the bogus invoices, sometimes by issuing
checks payable to cash, and other times by issuing checks
payable to the supposed vendors. Blumenberg had the
checks payable to cash cashed, and then pocketed the
funds. The checks payable to the bogus vendors were
deposited into bank accounts controlled by Viertel, who
kicked back a portion of the funds to Blumenberg and
retained the balance for himself.
By way of background, Burda Holding is a German
magazine and newspaper publisher. (Tr. 89-90). Burda
Media served as the New York press office for Burda
Holding, and provided support to the parent company in
that regard. (Tr. 89-90). Burda Media frequently hired
outside vendors to perform services for the ultimate
benefit of Burda Holding. Upon completion of the ser-
vices, the vendors would submit invoices to Burda Media.
Burda Media would then issue checks from its bank
account in New York to pay the vendors. Burda Media
either issued checks payable to the vendors or issued
checks for cash and gave the cash to the vendors. At the
end of each month, Burda Media sent the invoices submit-
ted by the vendors to Burda Holding in Germany via air
freight. (Tr. 94-101, 205, 302-03). Approximately twice
each month, whenever Burda Media’s bank accounts fell
below a certain level due to the payment of such invoices,
Burda Holding would replenish Burda Media’s accounts
by causing a sum of money to be wired from Burda Hold-
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ing’s bank account in Germany to Burda Media’s bank
account in New York. (Tr. 310, 319).
In furtherance of their scheme, Blumenberg and Viertel
created 287 phony invoices from a series of companies —
including Transvideo, TV Broadcast Center, Eurocast,
Telcopa, and Agate Reality (collectively, the “Nominee
Companies”) — and submitted these invoices to Burda
Media for payment. The evidence at trial confirmed that
the invoices issued by the Nominee Companies — and,
indeed, the companies themselves — were entirely bogus.
(Tr. 1316-24, 1344-52; GX 1020-25, 1030, 1031, 1207,
1208). As a result of the phony invoices, Burda Media
paid almost a million dollars for work that was never
performed. (Tr. 1447-55; GX 900A).
Burda Media paid the phony invoices by checks written
to “Cash” or to the respective Nominee Companies.
(Tr. 328-29). The checks made payable to the companies,
which totaled approximately $345,000,* were deposited
into bank accounts that Viertel controlled as follows:
• Checks totaling $114,000 made payable to
Transvideo and TV Broadcast Center were
deposited into an account maintained at BNP
Paribas that was opened under the name “Chris-

*
Burda Media paid the remaining approximately
$650,000 in checks payable to cash. The evidence estab-
lished that Blumenberg himself received the cash from
these checks directly from another Burda employee
(Tr. 329, 1458; GX 901); at sentencing, Viertel was not
held accountable for those funds.
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tian Viertel DBA TV Broadcast Center.”
(GX 78A, 79A, 80A, 81A, 82A, 82B, 82C,
82D, 82E, 83A, 84A, 89A, 1101, 1104-09;
Tr. 1374-83).
• Checks totaling $57,000 made payable to Euro-
cast were deposited into a different account at
BNP Paribas that Viertel controlled and that
was listed in the name of Viertel’s wife.
(GX 1301-02; Tr. 1383-85).
• Checks totaling $165,000 made payable to
Telcopa were deposited with the Banque Fran-
caise de L’Orient (“BFO”), in an account con-
trolled by Viertel. (Tr. 1417-23).
• Finally, a check issued by Burda Media for
$8,120 to Agate Reality Media Services (“Ag-
ate Reality”) was deposited into an account
Viertel maintained at Chase Manhattan Bank
under the name “Agate Realty.” (Tr. 1374-84,
1398-1427, 1433-37).*
After Viertel collected the money from the phony invoices,
he paid Blumenberg over $180,000 in kickbacks, in the
form of checks or direct payment of Blumenberg’s bills.
(GX 900A, 901, 902; Tr. 1447-1522).

*
This fifth fraudulent company, Agate Reality,
figured prominently at trial because the mailing of an
Agate Reality invoice (GX 501) provided the basis for the
substantive mail fraud count, and the replenishment funds
wired from Germany to New York after submission of this
invoice provided the basis for the wire fraud count.
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b. The Use of the Mails and the Wires
to Further the Scheme
As noted, Burda Media, the direct victim of the fraud,
had no revenue of its own, but rather served as the New
York press office for Burda Holding. (Tr. 89-90). Burda
Holding funded Burda Media by wiring money from
Germany to Burda Media’s New York bank account
whenever that account fell below a certain level. (Tr. 310,
319). To document its expenses, Burda Media on a
monthly basis transmitted by air freight its paid invoices
from New York to Germany. (Tr. 94-101, 205, 302-03).
Fraudulent invoices created by Viertel and Blumenberg
were, on a monthly basis, sent by interstate carrier from
New York to Germany. Similarly, regular interstate wires
from Germany to New York funded the payments Burda
Media made to Viertel and Blumenberg. (Tr. 94-101, 205,
302-03, 310, 319). The scheme could not have continued
and succeeded without these wirings and mailings; Burda
Media lacked the funds to pay the phony invoices but for
the wires from Germany (Tr. 92), and Burda Holding
would not have continued to replenish Burda Media’s
accounts had it not received the regular mailings contain-
ing the invoices documenting Burda Media’s spending.
2. The Defense Case
Viertel did not testify at trial and the defense called no
witnesses. During his opening statement and cross-exami-
nation of Government witnesses, Viertel’s trial counsel
floated several competing defense theories. At various
times, defense counsel suggested that Blumenberg created
the false invoices unbeknownst to Viertel; that some of the
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invoices reflected work Viertel actually performed (or,
relatedly, that the Government could not disprove that the
work reflected in the invoice had been performed); and
that some of the money Burda paid to Viertel reflected
Blumenberg’s repayment of money owed he owed to
Viertel.
3. The Defendant’s Rule 29 Motion
At the conclusion of the Government’s case, Viertel
moved, pursuant to Rule 29 of the Federal Rules of
Criminal Procedure, for dismissal of the charges and entry
of a judgment of acquittal. With respect to the mail fraud
and wire fraud charges, Viertel contended that the Govern-
ment had failed to prove that the specific mailing and wire
transfer charged in the S2 Indictment had occurred in
furtherance of the scheme to defraud. As to the former,
Viertel claimed that he had received the payment for the
Agate Reality invoice before the mailing occurred; that the
mailing had occurred after “Burda knew about the
scheme” (Tr. 1807); and that Viertel “could not have cared
less whether Burda got the invoices or didn’t get the
invoices” (Tr. 1808). With respect to the latter, Viertel
argued that the evidence established that there were many
checks paid; that “[Burda Media treasurer Ellen] Kiefer
was unable to say that this check had anything to do with
triggering a wire”’; and that Burda “knew what was going
on” at the time the wire transfer occurred. (Tr. 1808).
Viertel also moved for dismissal of the conspiracy charge,
claiming there was no evidence that Viertel saw the actual
invoices or knew that the checks deposited into his
account were obtained by fraudulent means. (Tr. 1809).
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The District Court denied Viertel’s Rule 29 motion. In
rejecting Viertel’s contentions with respect to the mail
fraud and wire fraud charges, Judge Koeltl stated:
Viewing the evidence in the light most
favorable to the government, the jury could
find that, with respect to the use of the mails
and the wires, those uses were in further-
ance of a scheme to defraud, because the
use of the mails and the wires was essential
to the fraud, which was not simply a fraud
by which a payment was made but a scheme
whereby the funds to obtain the money for
the payment would be obtained from Burda
in Germany such that, pursuant to the
scheme, an invoice would be sent to Ger-
many, where it would be kept, and that the
funds of Burda in New York would be
replenished by wires from Burda in Ger-
many such that Burda in New York would
have sufficient ongoing funds. This was not,
as in either [United States v. Maze, 414 U.S.
395 (1974)] or [Kann v. United States, 323
U.S. 88 (1944)], a case in which the scheme
to defraud was complete before the mailing
or the use of the wires was effected.
(Tr. 1817-18). With respect to the conspiracy charge,
Judge Koeltl found that “there is sufficient evidence from
which the jury could find that there was an agreement
between the defendant and Mr. Blumenberg to engage in
a scheme to defraud and that the scheme to defraud was a
scheme which had as its objects mail fraud and wire
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fraud.” (Tr. 1818). On October 2, 2002, a jury returned a
verdict finding Viertel guilty on all three counts.
C. Viertel’s Sentencing
On May 29 and June 9, 2003, the parties appeared for
sentencing. After extensive argument concerning the
appropriate loss figure, the District Court found:
It is plain that Burda was, in fact, defrauded
by over $900,000 in false invoices that it
paid out on the basis of false invoices from
the various Viertel companies. The evidence
supported the fact that work was not per-
formed as indicated on the invoices and the
invoices themselves were fraudulently
prepared. They included items such as false
phone numbers and addresses in addition to
the listing of false services that were not, in
fact, performed.
(6/9/2003 Tr. 11). Judge Koeltl found, however, “an
absence of evidence” that Viertel “actually prepared the
fraudulent invoices for the cash,” or that Blumenberg’s
activities in connection with his “pocket[ing]” of the cash
proceeds were reasonably foreseeable to Viertel — as
“opposed to the payments into accounts for Mr. Viertel,”
as to which Judge Koeltl found “there was ample evidence
of the knowledge of Mr. Viertel.” (6/9/2003 Tr. 12).
Accordingly, the District Court held Viertel responsible
for $345,673.96, the amount of “the checks made out to
the various Viertel companies that were actually deposited
into accounts for which the evidence at trial showed the
accounts were controlled by Mr. Viertel and were in the
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name of Mr. Viertel or [Viertel’s wife].” (6/9/2003
Tr. 13).* The Court ultimately determined that Viertel’s
Guidelines range was 21 to 27 months’ imprisonment, and
sentenced him principally to concurrent terms of imprison-
ment at the low end of that range.
D. Viertel’s Direct Appeal and Crosby Remand
On appeal, Viertel challenged the sufficiency of the
evidence at trial and the propriety of certain statements
made by the Government in summation. On May 28, 2004,
this Court affirmed Viertel’s conviction by summary order.
See United States v. Viertel, 98 Fed. Appx. 68. Viertel
filed a petition for rehearing on June 14, 2004, which was
denied by Order of this Court dated June 21, 2004. The
Court withheld the mandate, however, pending issuance of
the Supreme Court’s decision in United States v. Booker,
543 U.S. 220 (2005).
E. Viertel’s Post-Conviction Litigation and
Second Appeal
1. Viertel’s First Motion for a New Trial
On September 12, 2004, Viertel filed a pro se motion
in the District Court for a new trial pursuant to Rule 33.
(A. 149-92). Viertel alleged that five categories of ostensi-
bly “newly discovered” evidence merited either an eviden-

*
In so ruling, Judge Koeltl rejected Viertel’s conten-
tion that he believed the checks issued by Burda Media
and deposited in his accounts represented Blumenberg’s
repayment of personal debts that Blumenberg purportedly
owed to Viertel. (6/9/2003 Tr. 13-14).
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tiary hearing or a new trial: (1) documents that Viertel
claimed came from a 1996 audit report of Burda Media
(the “1996 Audit”); (2) documents that Viertel described
as transcripts of German police interviews of Wolfgang
Maginot, a Group Controller of Burda Holding; (3) a
document that Viertel maintained was an Agate Reality
invoice allegedly hand-carried by Maginot to Germany
from New York; (4) a document that Viertel maintained
was a waybill issued by Lufthansa at Newark International
Airport on or about June 28, 1996; and (5) unspecified
evidence that Fritz Blumenberg once used the address
listed on a fraudulent Telcopa invoice as Telcopa’s place
of business.
Of particular significance to the instant appeal were
documents that Viertel claimed to be the “1996 Audited
Financials” of Burda Media. (A. 150). Viertel attached
several pages of these “audited financials” to his motion,
and offered his own translations of the German statements
on those pages. Viertel claimed that the documents “would
have fatally damaged the prosecution . . . if [they] only had
been made available.” (A. 150). Specifically, he claimed
that the audited financials made clear that Burda Media
was a “self-sustaining independent company” (A. 188),
which had sufficient revenues that it did not require funds
from Burda Holding; from this, he argued that the Govern-
ment’s replenishment theory underlying the mail and wire
fraud charges was flawed (A. 152, 188-89; see also A. 211
(reply brief)).
The Government opposed Viertel’s motion in its
entirety. With particular focus on the 1996 Audit, the
Government noted that Viertel had not indicated the
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source of the audit papers, and, more to the point, had not
demonstrated that the Government had suppressed these
papers before trial. (A. 194). As for the merits of the
defendant’s claim, the Government argued that Viertel
strained to find materiality in the oblique term “self-
sustaining,” and failed to deal with the auditors’ statement
that “equity, financial status and profitability [do] not fall
within the scope of our analysis.” (A. 199; see A. 165-66).
Finally, the Government recounted for the District Court
the trial evidence establishing that Burda Holding in
Germany wired money to Burda Media’s New York bank
account whenever Burda Media’s account fell below a
certain level, and that Burda Media sent the paid invoices
from New York to Germany on a monthly basis to docu-
ment its expenses. (See A. 199 (citing Tr. 310-19); see
also Tr. 94-101, 205, 302-03).
In a comprehensive opinion dated May 4, 2005, the
District Court denied Viertel’s motion for a new trial
without convening a hearing. (A. 220-46). Reviewing
separately each of the categories of “newly discovered”
evidence, Judge Koeltl concluded that each category was
“not new evidence that could not, with the exercise of due
diligence, have been discovered sooner,” as required by
Rule 33. Moreover, Judge Koeltl found that the evidence
was not “material,” that is, it would not have “probably
produced a different verdict.” (See, e.g., A. 241). With
particular respect to the 1996 Audit, Judge Koeltl con-
cluded:
The 1996 audit of Burda Media does not
warrant a new trial pursuant to Rule 33. The
defendant has made no showing that either
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the 1996 audit or a similar purported state-
ment by Maginot are so material that they
would probably lead to a different verdict.
The defendant alleges that the 1996 audit
states that “since 1 January the corporation
is [self-sustaining].” The meaning of this
statement is unclear, although, in context, it
suggests only that Burda Media was orga-
nized as a separate company. That Burda
Media was organized as a separate company
does nothing to undermine the clear evi-
dence that invoices were sent by Burda
Media in New York to Burda Holding in
Germany and Burda Holding wire trans-
ferred funds to Burda Media. The scheme in
this case worked because fraudulent in-
voices were air freighted from New York
and because funds were wired from Ger-
many. Whenever the bank account of Burda
Media dropped below a certain level due to
the payment of these invoices, Burda Hold-
ing wired money to replenish Burda Me-
dia’s bank account in New York. The funds
were fraudulently obtained by Viertel and
Blumenberg and the 1996 audit does not
provide any evidence that would probably
change the verdict.
(A. 241-42 (record citations omitted)).
2. Viertel’s Motion for Resentencing
On April 13, 2005, the Court remanded the case to the
District Court for further proceedings in conformity with
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United States v. Crosby, 397 F.3d 103 (2d Cir. 2005).
Following the submission of briefs by the parties, the
District Court, on August 3, 2005, denied Viertel’s motion
for resentencing, finding: “The Court has carefully
reviewed the submissions of the parties and has concluded
that, fully aware that the Sentencing Guidelines are only
advisory and that the Court is to consider all of the factors
in 18 U.S.C. § 3553(a), the Court would not have sen-
tenced the defendant to a different sentence.” (A. 21-22,
Docket Entry 151).
3. Viertel’s Second Appeal
Viertel appealed the District Court’s denials of his
motions for a new trial and for resentencing. On Septem-
ber 26, 2007, by summary order, this Court affirmed both
decisions of the District Court. See United States v.
Viertel, 242 Fed. Appx. 779. The Court concluded that:
Viertel’s arguments with respect to the
District Court’s denial of his motion for a
new trial are without merit. . . . For substan-
tially the same reasons articulated in the
District Court’s Opinion and Order of May
4, 2005, 2005 WL 1053434, and its Memo-
randum Opinion and Order of August 2,
2005, 2005 WL 1844774, the judgment of
the District Court is AFFIRMED.
242 Fed. Appx. at 780.
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F. Viertel’s Second Motion for a New Trial
and Third Appeal
1. The Brady Claim
One week after this Court’s decision, on October 2,
2007, Viertel filed another motion for a new trial in the
District Court. This motion repeated Viertel’s claim that
newly discovered evidence undermined the Government’s
theory that Burda Holding transferred funds to Burda
Media in response to Blumenberg’s fraudulent invoices.
Viertel now claimed, however, that the materials that
exculpated him were “balance sheet books,” and, further,
that the Government had withheld the books from him.
Specifically, Viertel contended that the Government
“directly obtained, on August 7 and 8, 2002, four weeks
before trial, ‘balance sheet book’ originals of Burda
Media (Inc.) for the years 1985-1998,” and that “[t]hese
books show Burda Media Inc.[’s] huge income and the ‘96
book is [an] integral part of the ‘1995/6 audit’ submitted
by petitioner as newly discovered and as materially
exculpatory evidence.” (A. 248 (bolding and underscor-
ing in original)).
In support of his motion, Viertel provided the District
Court with a transmittal letter, dated August 7, 2002, from
Burda Media’s outside counsel to the Government; the
letter indicated that counsel was providing the Govern-
ment with, among other things, “an original Burda Media
‘balance sheet book’ for 1996 through 1998.” (A. 249).
Viertel first claimed that the transmittal letter “was just
obtained from German judicial files,” but later claimed
that the letter had in fact been located in “German legal
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files” in the summer of 2007. (Compare A. 248 (bolding
and underscoring in original) with A. 265 n.12).
The Government responded that Viertel had offered no
evidence to support his contention that any balance sheet
books obtained by the Government from Burda had not
been disclosed to defense counsel prior to trial. (A. 257).
To the contrary, the Government stated that it had a policy
of disclosing all information of that type to the defense
promptly upon receipt from third parties, and that it had no
reason to believe that this policy had not been followed
with respect to the balance sheet books. (A. 257).* The

*
The defense seeks to make much of the Govern-
ment’s purported change in position regarding its disclo-
sure obligations in its responses to the defendant’s first
and second new trial motions. (See, e.g., Br. 29-30). There
is, in fact, no inconsistency. Viertel’s first motion was
predicated on what Viertel claimed was a 1996 audit
report for Burda Media. (A. 150). As it advised the District
Court, the Government has no reason to believe it pos-
sessed the audit report prior to receiving excerpts of that
report in Viertel’s motion, and Viertel has not demon-
strated otherwise. (A. 194). Viertel’s second motion — at
least as it was presented to the District Court — pertains
not to that audit report, but to “balance sheet books” that
were forwarded by Burda Media’s counsel to the Govern-
ment. (A. 248). As to those materials, as it advised the
District Court, the Government has no reason to believe
that the materials it received from Burda Media’s counsel
were not promptly disclosed to the defense before trial.
(A. 257).
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Government also underscored that Viertel had offered
nothing to substantiate his contention that the balance
books revealed “huge” profits attributed to Burda Media
and, even if they had, documents created in connection
with accounting principles for accounting purposes did not
shed light on Burda’s day-to-day actual operations. Rather,
the Government noted, the trial testimony established that
Burda Media did not generate its own income, but rather
received money from Burda Holding with which to
operate. (A. 257).
On April 30, 2008, the District Court denied Viertel’s
motion for a new trial. (A. 269-74). Judge Koeltl soundly
rejected Viertel’s Brady claim, finding:
As an initial matter, the defendant has failed
to substantiate his allegation that the Gov-
ernment possessed the balance sheet books
and failed to disclose them to defense coun-
sel prior to the trial. “As a threshold matter,
the defendant must show that the Govern-
ment actually suppressed evidence.” United
States v. Esposito, 834 F.2d 272, 275 (2d
Cir.1987). The defendant has failed to pro-
vide evidence to support his allegations that
the Government failed to disclose balance
sheet books that it had, and therefore his
Brady claim should be denied as specula-
tive. See Skinner v. Duncan, No. 01 Civ.
6656, 2003 WL 21386032, at *25 and n.39
(collecting cases). In any event, the defen-
dant has made no showing that the balance
sheet books are so material that there is a
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realistic likelihood that their disclosure
would have resulted in a different verdict or
undermined confidence in the outcome of
the case, which provides an alternative basis
to deny the defendant’s claim of withheld
Brady material.
(A. 271).
2. The Restitution Claim
Viertel’s second new trial motion also contained
various claims regarding Viertel’s outstanding restitution
obligation. (See, e.g., A. 250-52, 254-55, 259-68). When
the District Court denied Viertel’s motion for a new trial,
it referred to a Magistrate Judge the determination of the
amount of restitution that remained outstanding. (A. 273-
74).
On December 23, 2011, the Government advised the
District Court that, after consultation with Burda Media,
the Government had no objection to the Court deeming
Viertel’s restitution obligation to be satisfied. Accordingly,
the Court entered a memorandum endorsement to that
effect. (A. 276). On December 27, 2011, Viertel filed the
Vacatur Motion, asking, the District Court to undo a series
of prior orders concerning restitution that had been entered
in the case. (A. 32, Docket Entry 269). The District Court
denied this motion by order dated January 6, 2012, finding
that
the fact that the victim in this case is pre-
pared to say that restitution has now been
satisfied in no way undermines or affects
any of the Court’s previous rulings concern-
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ing the amount of restitution that was owed
as a result of the defendant’s criminal con-
viction that was affirmed on appeal.
(A. 277-78).
Viertel filed a notice of appeal from this decision,
which was docketed by this Court as 12-389 and consoli-
dated with Viertel’s challenge to the District Court’s
denial of his Brady claim. In his brief on appeal, Viertel
makes clear that he no longer challenges the District
Court’s order regarding restitution. (Br. 41-42).
ARGUMENT
The District Court Properly Denied Viertel’s
Second Motion for a New Trial
The District Court properly rejected the defendant’s
Brady claim because Viertel demonstrated neither materi-
ality nor suppression. Viertel failed to demonstrate that the
balance sheet books had been suppressed by the Govern-
ment. Perhaps more importantly, Viertel made no effort to
identify what in the balance sheet books was exculpa-
tory — indeed, he did not include a single page from the
balance sheet books in his motion. Instead, Viertel merely
intoned that the “[t]hese books show Burda Media Inc.[’s]
huge income and the ‘96 book is [an] integral part of the
‘1995/6 audit’” (A. 248) — the precise audit report that
both Judge Koeltl and this Court had previously concluded
was not material.
On appeal, Viertel changes tack. Specifically, Viertel
abandons his claim that the balance sheet books were “an
integral part” of the 1996 Audit, and now claims for the
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first time that the books included the 1996 Audit. Working
backwards from this newly-minted premise, Viertel asks
this Court to revisit its prior decision concerning the 1996
Audit, this time using the less stringent standard of review
applicable to new trial motions predicated on a Brady
violation. (See Br. 24 (“Although this Court previously
affirmed an order denying a Rule 33 appeal concerning the
same audit evidence, defendant’s appeal here falls under
the more lenient standard applicable to Brady material and
only requires a loss of confidence in the verdict, not a
conclusion of acquittal.”)). This recast claim should be
rejected. As an initial matter, it was not the claim pre-
sented to the District Court. In any event, even were this
Court to consider Viertel’s claims concerning the 1996
Audit under the less stringent standard of review, the
claims would fail. This Court properly adopted Judge
Koeltl’s factual findings that fleeting, out-of-context
references to the “self-sustaining” nature of Burda Media
in the 1996 Audit cast no doubt on the surfeit of evidence
admitted at trial concerning the dependence of the U.S.
subsidiary on its German parent, and, more importantly, on
Viertel’s guilt of the offenses of conviction.
A. Applicable Law
1. Suppression and Materiality Under
Brady
The Government has an obligation under the Due
Process Clause to disclose to the defendant material
exculpatory and impeaching evidence. See Brady v.
Maryland, 373 U.S. 83 (1963); Giglio v. United States,
405 U.S. 150 (1972). To warrant a new trial based on a
violation of this obligation, “a defendant must show that:
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(1) the Government, either willfully or inadvertently,
suppressed evidence; (2) the evidence at issue is favorable
to the defendant; and (3) the failure to disclose this
evidence resulted in prejudice.” United States v. Coppa,
267 F.3d 132, 140 (2d Cir. 2001). Thus, it is not enough to
show that the Government failed to turn over any favor-
able evidence. A Brady or Giglio violation will result in a
new trial only “if the undisclosed information is ‘material,’
within the exacting standard of materiality established by
the governing case law.” United States v. Spinelli, 551
F.3d 159, 164 (2d Cir. 2008); accord United States v.
Rivas, 377 F.3d 195, 199 (2d Cir. 2004); United States v.
Middlemiss, 217 F.3d 112, 123 (2d Cir. 2000).
Where the proffered basis for a new trial is the Govern-
ment’s failure to disclose exculpatory evidence, the
Supreme Court has concluded that:
[The] touchstone of materiality is a reason-
able probability of a different result, and the
adjective is important. The question is not
whether the defendant would more likely
than not have received a different verdict
with the evidence, but whether in its ab-
sence he received a fair trial, understood as
a trial resulting in a verdict worthy of confi-
dence. A reasonable probability of a differ-
ent result is accordingly shown when the
government’s evidentiary suppression un-
dermines confidence in the outcome of the
trial.
Kyles v. Whitley, 514 U.S. 419, 34 (1995); accord United
States v. Bagley, 473 U.S. 667, 682 (1985) (suppressed
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evidence is “material only if there is a reasonable probabil-
ity that, had the evidence been disclosed to the defense, the
result of the proceeding would have been different”);
Strickler v. Greene, 527 U.S. 263, 281 (1999) (“there is
never a real ‘Brady violation’ unless the nondisclosure was
so serious that there is a reasonable probability that the
suppressed evidence would have produced a different
verdict”); United States v. Douglas, 525 F.3d 225, 245 (2d
Cir. 2008); United States v. Payne, 63 F.3d 1200, 1209 (2d
Cir. 1995) (“[U]ndisclosed evidence will be deemed
material only if it ‘could reasonably be taken to put the
whole case in such a different light as to undermine
confidence in the verdict.’” (quoting Kyles v. Whitley, 514
U.S. at 435)).
This Court has instructed district courts to consider the
evidence presented at trial in making the materiality
determination. See, e.g., United States v. Orena, 145 F.3d
551, 559 (2d Cir. 1998) (reversing district court’s grant of
new trial motion based on failure to disclose impeachment
evidence; noting that independent evidence of guilt
“increases the degree of significance that would need to be
ascribed to the withheld impeachment evidence in order
for it reasonably to undermine confidence in the verdict”);
accord Leka v. Portuondo, 257 F.3d 89, 104 (2d Cir.
2001).
2. Fed. R. Crim P. 33
Federal Rule of Criminal 33 provides, in relevant part,
that “[u]pon the defendant’s motion, the court may vacate
any judgment and grant a new trial if the interest of justice
so requires.” Fed. R. Crim. P. 33(a). This Court will
“review motions for a new trial under an abuse-of-discre-
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tion standard.” United States v. Rigas, 583 F.3d 108, 125
(2d Cir. 2009) (internal quotation marks omitted); see also
United States v. Sasso, 59 F.3d 341, 350 (2d Cir. 1995)
(“We will not reverse the denial of a new-trial motion or
the refusal to conduct an evidentiary hearing absent an
abuse of discretion.”). Findings of fact made by the district
court in connection with a Rule 33 motion will be over-
turned only if clearly erroneous. United States v. Stewart,
433 F.3d 273, 295 (2d Cir. 2006).
B. Discussion
Responding to Viertel’s claims on appeal is compli-
cated by the shifting nature of his materiality argument.
Before the District Court, Viertel maintained that the
balance sheet books reflected “huge income” attributable
to Burda Media. (A. 248). However, Viertel produced
nothing to substantiate this allegation. As the Government
noted, even if the company’s balance sheet books had
reflected profits, these accounting documents shed no light
on — and therefore did not undermine the extensive trial
testimony concerning — Burda Media’s actual operations.
(A. 257). This testimony established beyond credible
dispute that Burda Media in New York did not generate its
own income, but rather received money from Burda
Holding in Germany. (See Tr. 94-101, 205, 302-03, 310,
315). On this record, the District Court did not abuse its
discretion in concluding that the purportedly withheld
evidence cited by Viertel in his second new trial motion —
the balance sheet books from which Viertel did not cite a
single page — would not have resulted in a different
verdict or undermined confidence in the outcome of the
case. (A. 271).
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On appeal, Viertel maintains that his second new trial
motion, like his first, involved the Government’s pur-
ported nondisclosure of the 1996 Audit. (Br. 24, 29-30). It
did not. Viertel contended before the District Court that
one of the purportedly withheld balance sheet books “is
[an] integral part of the ‘1995/6 audit’ submitted by
petitioner as newly discovered and as materially exculpa-
tory evidence” (A. 248), but he never contended that the
balance sheet books included the 1996 Audit. Precisely
because Viertel’s motion was not predicated on the
withholding of the 1996 Audit, the Government did not
address that report in its response, nor did the District
Court address it in its decision. Viertel should not be
permitted to present a wholly different theory of material-
ity to this Court.
In any event, even were this Court to reconsider
Viertel’s first new trial motion under the less stringent
standard, Viertel’s appeal cannot succeed, because he
cannot show that the disclosure of the 1996 Audit would
have undermined confidence in the outcome of the trial.
The report’s description of Burda Media as “self-sustain-
ing” and its attribution of profits to Burda Media simply
does not undermine the findings of the District Court,
which were adopted by this Court in the previous appeal:
The scheme in this case worked because
fraudulent invoices were air freighted
from New York and because funds were
wired from Germany. Whenever the
bank account of Burda Media dropped
below a certain level due to the payment
of these invoices, Burda Holding wired
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money to replenish Burda Media’s bank
account in New York. The funds were
fraudulently obtained by Viertel and
Blumenberg and the 1996 audit does not
provide any evidence that would proba-
bly change the verdict.
(A. 241-42 (record citations omitted)). See United States
v. Orena, 145 F.3d at 559 (concluding that no new trial
was warranted where the record reflected independent
evidence of the defendant’s guilt).*
Separately and independently, Viertel’s appeal fails
because he cannot establish that the District Court abused
its discretion in determining that Viertel had “failed to
provide evidence to support his allegations that the
Government failed to disclose balance sheet books that it
had, and therefore his Brady claim should be denied as

*
Viertel’s contention that “[a]n additional flaw
exposed by the audit that undermines the ‘replenishment’
theory is the revelation that the corporate entity subcon-
tractually receiving the invoices was not Burda Holding
the alleged replenisher of monthly expenses” (Br. 40),
confounds logic. The fact that the audit does not identify
invoices submitted between 1992 and 1996 does not, of
course, mean that invoices were not submitted and paid.
Moreover, the audit’s apparent allocation of profits and
losses to various Burda publications and entities utilizing
services provided by Burda Media in no way contradicts
the testimony at trial concerning the day-to-day operations
of Burda Media and the relationship between Burda Media
and Burda Holding.
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speculative.” (A. 271). Viertel offered no evidence that the
Government, either willfully or inadvertently, failed to
disclose the balance sheet books. His reliance on the
“transmittal letter from counsel for Burda Media NY to the
government enclosing ‘balance sheet books’ for the
company for the relevant period of 1996 through 1998” is
unwarranted. (Br. 30). While the transmittal letter indi-
cates that the Government received various items from
Burda Media prior to trial, it does not establish that the
Government failed to disclose these items to Viertel. The
Government proffered below that its practice was to
disclose such information to the defense promptly upon
receipt and that it had no reason to believe such practice
was not followed with respect to this information.
(A. 257). Given the lack of evidence in the record that the
Government failed to disclose the items received from
Burda Media, Judge Koeltl did not err in finding that “the
defendant has failed to substantiate his allegation that the
Government possessed the balance sheet books and failed
to disclose them to defense counsel prior to the trial.”
(A. 271).
This Court should reject Viertel’s efforts to obtain a
“do-over” of his earlier new trial motion. Given Viertel’s
failures below to meet the suppression and materiality
prongs of Brady, the District Court properly denied Vier-
tel’s motion and this Court should affirm.
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CONCLUSION
The District Court’s orders entered on May
1, 2008, and on January 9, 2012, should be
affirmed.
Dated: New York, New York
August 13, 2012

Respectfully submitted,

PREET BHARARA,
United States Attorney for the
Southern District of New York,
Attorney for the United States
of America.

MARCIA S. COHEN,
KATHERINE POLK FAILLA,
Assistant United States Attorneys,
Of Counsel.
Case: 11-5442 Document: 46 Page: 38 08/13/2012 690322 38

CERTIFICATE OF COMPLIANCE

Pursuant to Rule 32(a)(7)(C) of the Federal Rules of
Appellate Procedure, the undersigned counsel hereby
certifies that this brief complies with the type-volume
limitation of Rule 32(a)(7)(B). As measured by the word-
processing system used to prepare this brief, there are
7,287 words in this brief.

PREET BHARARA,
United States Attorney for the
Southern District of New York

By: KATHERINE POLK FAILLA,
Assistant United States Attorney