The People, Respondent,v.Lawrence P. Frumusa,, Appellant.BriefN.Y.May 3, 2017 To Be Argued By: Drew R. DuBrin Time Requested: 10 Minutes APL-2016-00065 Court of Appeals State of New York THE PEOPLE OF THE STATE OF NEW YORK, Respondent, -vs- LAWRENCE P. FRUMUSA, Appellant. BRIEF FOR APPELLANT TIMOTHY P. DONAHER Monroe County Public Defender Attorney for Appellant BY: DREW R. DuBRIN Special Assistant Public Defender 10 N. Fitzhugh Street Rochester, New York 14614 Tel: (585) 753-4947 Fax: (585) 753-4234 Date Completed: May 16, 2016 TABLE OF CONTENTS PAGE TABLE OF AUTHORITIES i-iv PRELIMINARY STATEMENT 1 QUESTIONS PRESENTED 2 STATEMENT OF FACTS 4 ARGUMENT The Admission of the Criminal Contempt Order – Which Revealed Justice Fisher’s Finding That Mr. Frumusa Committed The Very Larceny He Was On Trial For – Was Highly Prejudicial As It Encroached Upon The Jury’s Province To Find Guilt, Independently, Free From Outside Influences. Yet All Of The Judicial Findings Contained In the Contempt Order Had No, Or Minimal, Probative Force. 23 1. The People Introduced the Contempt Order As Part of Strategy that Enabled Them to Urge the Jury to Hold Mr. Frumusa Accountable For Stealing The Credit Card Funds Just As Justice Fisher Tried To Do With His Contempt Order. 24 2. The Contempt Order Posed Tremendous Prejudice. 26 3. The Contempt Order Had No, or Virtually No, Probative Worth on any of the Trial’s Material Issues. 30 a. The contempt order revealed only a judge’s personal conclusion that Mr. Frumusa’s companies did not abide by the July 27, 2009 court order requiring the companies to return WHD money or to turn over certain documentation, conclusions that the justice made at a civil contempt proceeding where Mr. Frumusa did not put up a defense. 31 b. The contempt order was not relevant to whether Mr. Frumusa knew he was not allowed to access or retain the credit card funds during the time period alleged in the indictment. 33 c. The contempt order was not necessary to show that Mr. Frumusa or his companies disobeyed a court order to pay back the credit card funds (and thus intended to withhold it permanently). 33 d. Nothing concerning Mr. Frumusa’s intended use of the WHD funds can be inferred from the fact that he did not return the money as directed by the July 27, 2009 order, as the evidence at trial raised doubts about his ability to pay the money back. 35 e. Nothing relevant can be inferred from the fact that Mr. Frumusa did not oppose the motion to hold his companies in contempt. 37 4. The Contempt Order’s Admission was Not Harmless. 37 CONCLUSION 41 i TABLE OF AUTHORITIES Federal Cases Anderson v Genuine Parts Co., 128 F3d 1267 (8th Cir 1997) ............................................................................ 32 Coleman Motor Co. v Chrysler Corp., 525 F2d 1338 (3d Cir 1975) ............................................................................. 28 GE v Joiner, 522 US 136 (1997) ........................................................................................... 23 Murphy v Waterfront Comm'n of NY Harbor, 378 US 52, 94 (1964) ........................................................................................ 37 Till v SCS Credit Corp., 541 US 465 (2004) ........................................................................................... 37 Federal Statutes 11 USCS § 541 (a) ................................................................................................. 36 11 USCS § 362 (a) ................................................................................................. 36 28 USCS § 1334 (e) ............................................................................................... 36 State Cases El-Dehdan v El-Dehdan, 26 NY3d 19 (2015) ..................................................................................... 21, 33 Guarnier v Am. Dredging Co., 145 AD2d 341 (1st Dept 1988) ........................................................................ 32 Laverty v Snethen, 68 NY 522 (1877) ............................................................................................. 26 People v Allweiss, 48 NY2d 40 (1979) ........................................................................................... 34 People v Alvino, 71 NY2d 233 (1987) ......................................................................................... 34 People v Basora, 75 NY2d 992 (1990) ......................................................................................... 35 ii People v Bouton, 50 NY2d 130 (1980) ......................................................................................... 32 People v Brown, 107 AD3d 1145 (3d Dept 2013) ....................................................................... 19 People v Cass, 18 NY3d 553 (2012) ......................................................................................... 24 People v Chesler, 50 NY2d 203 (1980) ..................................................................................... 9, 25 People v Cook, 37 NY2d 591 (1975) ......................................................................................... 23 People v Crimmins, 36 NY2d 230 (1975) ......................................................................................... 38 People v De George, 73 NY2d 614 (1989) ................................................................................... 23, 37 People v De Jesus, 42 NY2d 519 (1977) .................................................................................. 28, 38 People v Frumusa, 134 AD3d 1503 (4th Dept 2015) .................................................... 21, 22, 23, 31 People v Gaines, 74 NY2d 358 (1989) ......................................................................................... 33 People v Giles, 11 NY3d 495 (2008) ....................................................................................... 29 People v Gonzalez, 68 NY2d 424 (1986) ......................................................................................... 37 People v Green, 5 NY3d 538 (2005) ................................................................................. 9, 25, 31 People v Holmes, 112 AD2d 739 (4th Dept 1985) ........................................................................ 21 People v Hommel, 41 NY2d 427 (1977) ............................................................................. 27, 28, 38 iii People v Ingram, 71 NY2d 474 (1988) ......................................................................................... 21 People v Medina, 185 Colo 101, 521 P2d 1257 (1974) ................................................................ 32 People v Molineux, 168 NY 264 (1901) ..................................................................................... 14, 19 People v Pavone, 26 NY3d 629 (2015) ....................................................................................... 35 People v Resek, 3 NY3d 385 (2004) ............................................................................... 23, 30, 35 People v Ricchiuti, 93 AD2d 842 (2d Dept 1983) ....................................................................... 9, 25 People v Salcedo, 92 NY2d 1019 (1998) ....................................................................................... 33 People v Smith, 129 AD3d 1549 (4th Dept 2015) ...................................................................... 19 People v Vargas, 86 NY2d 215 (1995) ......................................................................................... 23 People v Vargas, 88 NY2d 856 (1996) ......................................................................................... 34 People v Ventimiglia, 52 NY2d 350 (1981) ............................................................................. 33, 35, 37 People v Yut Wai Tom, 53 NY2d 44 (1981) ........................................................................................... 27 Secada v Weinstein, 563 So 2d 172 (Fla Dist Ct App 1990) ............................................................. 29 State Statutes CPL 450.90 (1) ......................................................................................................... 1 CPL 470.05 .............................................................................................................. 1 iv CPL 470.35 (1) ......................................................................................................... 1 Penal Law § 155.00 .............................................................................. 19, 27, 31, 35 Penal Law § 155.05 ................................................................................ 9, 25, 26, 30 Penal Law § 155.40 .................................................................................................. 8 1 PRELIMINARY STATEMENT By permission of the Honorable Stephen K. Lindley, Associate Justice of the Appellate Division, Fourth Department, granted March 18, 2016, Lawrence P. Frumusa appeals from an order of the Appellate Division, Fourth Department, dated December 31, 2015. The order affirmed a judgment of the Monroe County Court, rendered on September 30, 2011, in which Mr. Frumusa was convicted upon a jury trial of grand larceny in the second degree and sentenced to 4 to 12 years’ imprisonment. Pursuant to CPL 450.90 (1), 470.05, 470.35 (1), this Court has jurisdiction to entertain the questions presented here. 2 QUESTIONS PRESENTED Lawrence Frumusa, the managing and majority member of a hotel company, was tried on the charge of grand larceny in the second degree, accused of taking credit card payments due the company between December 1, 2008 and June 15, 2009. During a portion of that period, the company was in receivership and court orders were in place prohibiting any company member from accessing or retaining company money. Mr. Frumusa did not dispute at trial that he had taken and retained control of the credit card funds but contended that he did so only to pay company bills. At trial, the County Court admitted in evidence over Mr. Frumusa’s objection an October 26, 2009 civil contempt order, which the Supreme Court had issued against three other companies Mr. Frumusa operated. This contempt order was based on a finding that the three companies had disobeyed a July 27, 2009 order to return the hotel company funds and provide the receiver with certain documentation. The order included a finding by the Supreme Court that the companies had “converted” the funds and that such conduct was “calculated to and actually did defeat, impair, impede and prejudice the rights and remedies of” the hotel company. The evidence at trial showed that the money at issue in the contempt order was the very money Mr. Frumusa was charged with stealing. Thus, the contempt order included a finding that Mr. Frumusa, through his other 3 companies, committed the exact crime he was on trial for. Indeed, the prosecutor urged the jury in the final words of his summation to hold Mr. Frumusa accountable for stealing the hotel company’s funds just as Justice Fisher had tried to do with his contempt order. Questions below: Whether the contempt order, in the context of the People’s case, was either irrelevant or so lacking in probative worth and prejudicial that its admission is an error of law. Answer below: The Appellate Division erroneously held that the County Court did not err in admitting the contempt order. 4 STATEMENT OF FACTS Webster Hospitality Development LLC Lawrence Frumusa, the appellant, was a businessman and developer who operated two companies, Scenic Village Apartments LLC and Frumusa Enterprises LLC, when he agreed to go into business with a Florida investor, Marianela Hernandez, to develop and operate a Holiday Inn Express hotel in Webster, New York (Appendix [A] 95-101). A limited liability company, Webster Hospitality Development LLC (WHD), was formed, and Ms. Hernandez made an initial investment of a million dollars, giving her about a twenty-five percent interest in the company (A 97, 103; 462-496 [People’s Exhibits 11-12]). Mr. Frumusa became the hotel company’s majority and managing member, holding about a seventy-five percent interest in the company (A 103, 141). As managing member, Mr. Frumusa was given substantial power to act on the company’s behalf: he had authority to acquire assets, obtain up to a million dollars in financing, and distribute company assets upon liquidation (A 141-142). He was free to make payments from WHD’s operating account so long as they were made for the company’s benefit (A 133). WHD obtained financing for the hotel project through Genesee Regional Bank. The bank’s commitment letter stated that WHD was required to maintain a “deposit relationship” with the bank; however, the mortgage agreement imposed 5 no such requirement (A 53-54; 57-59). WHD, as well as Mr. Frumusa’s other companies (Frumusa Enterprises and Scenic Village Apartments), subsequently opened accounts with the bank (A 56-57). The company purchased property for the hotel site in August of 2006 and construction began later that year (A 101, 123-124). One of Mr. Frumusa’s other companies, Frumusa Enterprises, eventually took over construction, and Mr. Frumusa, as president of Frumusa Enterprises, oversaw the work (A 124). WHD’s operating agreement required that bank accounts be established and maintained in the company’s name and that its members not comingle company money with outside funds (A 100-101). Despite the agreement, funds were transferred between WHD’s accounts and accounts of Ms. Hernandez and Frumusa Enterprises (A 127-133). And payments from outside accounts were made on WHD’s behalf (A 104, 130-132, 219-220). In June of 2008, for example, $300,000 and $567,661.84 of WHD funds were transferred to Ms. Hernandez to reimburse her for payments she had made for the company (A 62-63, 129). As another example, in August of 2008, a transfer from Frumusa Enterprises to WHD was made (A 264). And in March of 2009, Mr. Frumusa paid a portion of a $100,000 tax bill (A 165-167). 6 The hotel opened in October of 2007. As managing member, Mr. Frumusa was responsible for the “accounting aspects of the hotel,” “like paying creditors, paying vendors, [and] balancing checkbooks” (A 196). The hotel struggled to become profitable – though, in the hotel manager’s opinion, the traffic was healthy -- and Hernandez was called on to invest more of her own money to keep the business afloat (A 103-106, 198). Over time, the business relationship between Ms. Hernandez and Mr. Frumusa grew acrimonious (A 102-106, 217, 221-222). Hernandez eventually complained to Mr. Frumusa about his business practices -- in particular, his transferring money in and out of the company’s accounts (A 106). When Mr. Frumusa explained that he was using the money only to pay what was due to the hotel’s contractor, Frumusa Enterprises, Hernandez requested a full accounting (A 106). Mr. Frumusa became fearful that Hernandez would limit his use of company operating funds and his ability to pay vendors (A 221-222). Hernandez did not seem to be satisfied by the information Mr. Frumusa provided (A 106, 126-127), and in October of 2008, Hernandez met with her lawyers, who soon thereafter initiated an action in Supreme Court to enjoin Mr. Frumusa from continuing his practice of transferring company funds to outside accounts (A 107). In February of 2009, Supreme Court Justice Fisher issued orders appointing a receiver to take control of the hotel, enjoining both Ms. 7 Hernandez and Mr. Frumusa from accessing company funds, and directing that Ms. Hernandez and Mr. Frumusa provide the receiver with company bank records (A 108-111, 153-154). The court-appointed receiver, Timothy Foster, had no hotel management experience whatsoever (A 170-171). Nevertheless, as receiver, Foster was responsible for insuring the hotel’s overall viability; in short, he was to run the hotel as if it were his own, though its day to day operation was to be left to a management company (A 150-151, 165). The management company took over responsibility for bill payment, but bills were not always paid on time (A 165, 173- 176, 196). Creditors became frustrated and filed an involuntary bankruptcy petition against WHD (A 137-138). When Mr. Frumusa met with Foster, he provided Foster with boxes of records: one box included payroll records; another included WHD bills; and a third was labeled “Frumusa Enterprises” (A 177). The records included invoices showing a construction payment due Frumusa Enterprises (A 177). Mr. Frumusa would later speak to a Rochester Business Journal reporter and express concern about Foster’s ability to oversee the company, fearing what Foster’s appointment would mean for the multimillion dollar investment (A 226-236, 520-523 [People’s Exhibit 23]). As WHD headed into receivership, and with concerns that Hernandez was trying to limit his control of WHD’s operating funds, Mr. Frumusa opened three 8 additional bank accounts with a separate institution, National City Bank (NCB)1, under the name of each of his businesses -- Webster Hospitality Development, Frumusa Enterprises, and Scenic Village Apartments (A 245-254). Though Mr. Frumusa did not tell Hernandez or Foster about the NCB accounts or provide records of their activity (A 113-114, 156, 159), Foster did learn of the accounts in June of 2009 (A 155- 156). Mr. Frumusa arranged for the hotel’s American Express credit card payments to be deposited into the NCB accounts beginning February 11, 2009 (A 243-245). Approximately $299,500 in credit card payments, along with hundreds of thousands of dollars from other sources, went into the NCB accounts (A 254, 258). Hernandez’s litigation against Mr. Frumusa continued, but with, as Hernandez described it, the lawsuit in “like a standby because Mr. Frumusa [had] filed for bankruptcy early June of 2009,” Hernandez’s attorneys directed her to contact authorities (A 115, 255, 267). The Criminal Prosecution A Monroe County indictment subsequently charged Mr. Frumusa with grand larceny in the second degree (Penal Law § 155.40 [1]) for having directed the credit card payments into the NCB accounts between December 1, 2008 and June 15, 2009 (A 14). Mr. Frumusa pleaded not guilty to the charge and was tried before a jury. By the time of trial, Hernandez, who all told invested less than two 1 National City Bank is now known as “PNC Bank.” 9 million dollars in the hotel project, had become the sole member of the multimillion dollar company (A 143-145). Mr. Frumusa did not dispute at trial that he had transferred funds in and out of WHD’s operating account, both before and after the company went into receivership, acknowledging sloppy business practices and violations of both the company’s operating agreement and various court orders. And he did not deny having directed the credit card payments into the NCB accounts. He did, however, contend that he took and maintained control of the credit card funds only to pay company bills. He insisted that as managing and majority member, he believed that he had the company’s permission to use the funds for the company’s benefit, notwithstanding various court orders restraining him from accessing the funds, and thus did not have a larcenous intent when he took control and then used the funds (A 294; see Penal Law § 155.05 [1]; People v Chesler, 50 NY2d 203, 207-210 [1980]; People v Green, 5 NY3d 538, 542 [2005] [good-faith claim of right negates larcenous intent]; People v Ricchiuti, 93 AD2d 842, 844 [2d Dept 1983] [a component of larceny’s requirement that the defendant’s dominion and control over property is “wholly inconsistent” with the rights of the owner is an awareness that the taking is without the owner’s consent]). The People introduced at trial bank statements showing that credit card payments had been redirected into the NCB accounts and that various payments 10 were made from those accounts. The People did not, however, link the deposited credit card funds to particular personal expenditures of Mr. Frumusa. Indeed, the bank statements showed that hundreds of thousands of dollars from other sources were deposited into the accounts (A 258). The People did not identify the payees of several large transfers out of the accounts (A 79, 274-276). And though the bank statements revealed that payments had been made for particular goods and services, there was no testimony establishing those expenditures were not made on WHD’s behalf (A 690, 694-696, 698-702, 705-610, 713-718, 721-723, 728, 742, 744, 750-751 [People’s Exhibits 6, 7, 8]). The Supreme Court Orders of Injunctive Relief and Receivership Without objection, the People introduced at trial a series of orders of the Supreme Court (Hon. Kenneth R. Fisher presiding) issued upon a civil action brought by Hernandez against Mr. Frumusa personally. People’s Exhibit 13 -- “Order to Show Cause for Injunctive Relief and Appointment of Temporary Receiver” dated February 9, 2009: Among other things, this order directed Mr. Frumusa to show cause why the court should not enjoin him personally from “transferring, releasing, assigning, encumbering or otherwise disposing of” WHD assets; appoint a temporary receiver of WHD; and direct him “to cause WHD to deposit all cash and non-cash receipts in the [WHD accounts], cooperate with such receiver, and turnover all books and 11 records of WHD or relating to any expenses or obligations for which WHD is alleged to be responsible for payment or reimbursement.” It also enjoined Mr. Frumusa, pending a hearing on the motion, from “transferring, releasing, assigning, encumbering, or otherwise disposing of any credits, assets or property of WHD.” (A 497-499.) People’s Exhibit 14 -- “Order Appointing Temporary Receiver” dated February 13, 2009: Relevant to this appeal, this order appointed Timothy Foster temporary receiver of WHD and set forth his managerial authority and duties as temporary receiver. It also prohibited Mr. Frumusa personally from collecting “any monies, revenue or proceeds from the operation of WHD”; directed that Mr. Frumusa personally “pay over to the Receiver any proceeds, revenues, credits and receipts or monies of WHD currently [or in the future] in [his] possession, custody or control” by March 1, 2009; and ordered that Mr. Frumusa personally deliver to the receiver by March 1, 2009 all books and records of WHD, as well as all other books or records necessary to the operation and maintenance of WHD. (A 500- 507.) People’s Exhibit 16 – “Order to Show Cause with Temporary Restraining Order” dated June 30, 2009: This order directed that Mr. Frumusa show cause on July 22, 2009 why he personally should not be (1) held in contempt for disobeying the court’s orders in 12 this matter (2) enjoined “from using, transferring or in any way disposing of monies forwarded by the American Express Company to any account controlled by him or any limited liability company, corporation or partnership in which Frumusa has an interest in relation to WHD; and (3) compelled to deliver “all assets and property of WHD, as well as all books, records and files of WHD relating to the operation of the Hotel in [his] possession or control . . . .” Furthermore, it restrained Mr. Frumusa, pending WHD’s motion for contempt or until further order of the court, from “transferring, converting or otherwise wrongfully dissipating the Amex Receivables due to [WHD].” (A 511-513.) People’s Exhibit 17 – “Amended Order to Show Cause with Temporary Restraining Order” dated July 10, 2009: Of significance to this appeal, this order directed Mr. Frumusa to appear and show cause why he personally should not be (1) held in contempt and punished for disobeying prior orders of the court; (2) enjoined from “using, transferring, or in any way disposing of monies forwarded by the American Express Company to any account controlled by him or any limited liability company, corporation or partnership in which Frumusa has an interest in relation to [WHD]”; (3) compelled to deliver “all assets and property of [WHD], as well as all books, records of [the company] relating to the construction and/or operation of the hotel . . . in the possession or control of [him], or his agents . . .”; and (4) directed, “as managing 13 member and/or signatory on banking accounts for the non-bankrupt entities including, but not limited to, Frumusa Enterprises LLC, Scenic Village Apartment Homes LLC, and L Frumusa Family Enterprise P1 LLC, to turnover and/or repay to [WHD] the monies transferred from [the NCB account opened under WHD’s name].” The order also restrained and enjoined Mr. Frumusa personally “from transferring, converting or otherwise wrongfully dissipating the Amex Receivables due to [WHD]” while the motion for contempt was pending. (A 514-516.) The Admission of Justice Fisher’s Contempt Order, Setting Forth His Findings That Companies Mr. Frumusa Operated “Converted,” to WHD’s “Prejudice,” the Very Money Mr. Frumusa Was Alleged to Have Stolen. The People included among their list of witnesses Supreme Court Justice Kenneth Fisher, who issued the above referenced orders (A 556), as well as an October 26, 2009 order adjudging companies that Mr. Frumusa operated (Frumusa Enterprises, Frumusa Family Enterprise, and Scenic Village Homes) in contempt for failing to obey the July 27, 2009 order. The contempt order includes various findings relating to the very theft Mr. Frumusa was charged with (A 115-117, 517- 519 [People’s Exhibit 18]). The order states that upon application of WHD, and without opposition of the Frumusa companies, and with “due deliberation,” Justice Fisher adjudicated the companies in contempt, finding, among other facts: 1) the companies “converted” $ 249,196.28 of WHD’s money; 14 2) the companies had refused to “obey with the direction of a July 27, 2009 order that they return the converted funds, deliver certain documents, and appear for examination,” and 3) this conduct, along with other contemptuous conduct, was “calculated to and actually did defeat, impair, impede and prejudice the rights and remedies of WHD.” (A 115-117, 517-519 [People’s Exhibit 18].) The order also “fined” one of Mr. Frumusa’s companies, Frumusa Enterprises, $249,811.67 for “this misconduct” and costs and expenses of the proceeding, “representing the actual loss and injury caused by [the] conversion of funds and other acts of non-compliance with the Order” (A 517-519 [People’s Exhibit 18]). Frumusa Enterprises, which was at that point having substantial financial difficulties, never paid the fine (A 117, 216-217, 719, 727 [People’s Exhibit 6]). The People ultimately did not call Justice Fisher to testify. And they did not seek to introduce the July 27, 2009 order that Justice Fisher found the Frumusa companies had disobeyed. But they did offer his contempt order as “Molineux” or uncharged bad act evidence (see People v Molineux, 168 NY 264 [1901]). In one sense, the contempt order did involve an uncharged bad act, namely, the failure of the Frumusa companies to obey the Supreme Court’s July 27th order, conduct which, itself, had not led to criminal charges. In another sense, however, the 15 contempt order involved bad acts that were very much charged, as it involved the exact theft Mr. Frumusa was indicted for: the order included findings that the Frumusa companies “converted” the money Mr. Frumusa was indicted for stealing and that Mr. Frumusa violated the July 27th order by not returning that money. The prosecutor assured the court he was not offering the order to “suggest that just because a judge found . . . the defendant's company . . . in contempt of Court . . . [the jury] should convict him on this charge” (A 529). He claimed he was instead introducing the order to show “intent to steal, absence of mistake, and his knowledge that he was not entitled to profits of the company during the time periods alleged in the indictment” (A 17, 529-530). He explained that because Mr. Frumusa was a WHD member, a guilty state of mind could not be readily inferred from his conduct of either directing the funds into NCB accounts or retaining them there. The contempt order revealed “not only was [Mr. Frumusa] not allowed to [access or retain] the credit card payments, he was ultimately held in contempt for doing that.” (A 18, 529-530). The prosecutor maintained that the order showed Mr. Frumusa must have known he was not permitted to access or hold onto the funds, and it therefore tended to prove he had a larcenous intent when he did (A 18, 529). The indictment, however, alleged that Mr. Frumusa stole the credit card payments during a period between December 1, 2008 and June 15, 2009, which was before Justice Fisher issued the contempt order on October 26, 2009, before the motion for contempt was made (A 517 [People’s Exhibit 18 (motion made on August 20, 16 2009)]), and even before Justice Fisher issued his July 27, 2009 order that the Frumusa companies were held in contempt for violating. Once more, there was no evidence presented at trial that Mr. Frumusa redirected any of the WHD credit card payments after Justice Fisher issued his July 27th order. The prosecutor noted, “the defendant, personally, did not appear nor did he file the motions objecting to the motion for contempt that was filed by the plaintiff's attorneys in this case” (A 18, 530). Defense counsel opposed the Molineux application, raising questions about the relevance of the contempt findings (A 528). He also argued that their potential for prejudice far outweighed any probative worth they might have. Defense counsel expressed concern that the jury would defer to, or at least be influenced by, Justice Fisher’s particular finding that Mr. Frumusa committed the very crime he was charged with (A 528). The County Court ruled the order admissible without giving an explanation, and the order was later received in evidence (A 116, 530-531). Testimony at trial established that the money Justice Fisher found to have been “converted” was the exact money Mr. Frumusa was charged with stealing (A 115-116). The contempt order identified the Frumusa companies as the subject of its findings. At trial, however, the prosecutor executed a strategy to convey to the jury that it was Mr. Frumusa who carried out the actions of his other companies 17 and that it was thus Mr. Frumusa personally – not the companies -- who was the actual subject of the contempt findings. First, though the Supreme Court made its contempt determination for a violation of the July 27th order, the People did not introduce that order. Instead the People offered other orders, those issued against Mr. Frumusa personally, creating at least the impression that it was a violation of the other orders, all issued against Mr. Frumusa personally, that served as the basis for the contempt adjudication (A 497-516 [People’s Exhibits 13-17]). Second, the prosecutor repeatedly indicated to the jury, both in his questions of Hernandez and his summation remarks, that it was Mr. Frumusa – and not his companies – whom Justice Fisher had held in contempt (A 159, 316). Third, the prosecutor elicited testimony from Hernandez stating that the contempt order held Mr. Frumusa personally in contempt (A 159). Last, the prosecutor presented evidence showing that the money the contempt order said had been “converted” by the Frumusa companies was the exact money the indictment charged Mr. Frumusa with personally stealing (A 115-117). Though, in making his Molineux application, the prosecutor assured the court he was not offering the contempt order to argue “that just because a judge found . . . the defendant's company . . . in contempt of Court . . . [the jury] should convict him on this charge,” the prosecutor, in the final words of his summation, argued just that: “You have heard that he [Mr. Frumusa] had been ordered to pay 250,000 some odd dollars and that he’s never paid the company back 18 that money. So now you can hold him responsible. The Court had tried by trying to fine him and that didn’t work. They issued order after order after order trying to hold him in contempt. Now you can issue that decision. You can hold him responsible for this, and you can find him guilty of Grand Larceny in the Second degree.” (A 316.) Upon its request, the jury was provided with a copy of the contempt order during its deliberation (A 360-361). Verdict and Sentence Just about an hour after the contempt order was given to the jury, the jury found Mr. Frumusa guilty as charged (A 360-372). The County Court sentenced Mr. Frumusa to four to twelve years’ imprisonment (A 410). Mr. Frumusa was paroled at his earliest release date.2 The Appellate Division Decision On appeal to the Appellate Division, Mr. Frumusa contended that the County Court erred as a matter of law in admitting the civil contempt order. He argued that the order was irrelevant and, alternatively, that the trial court abused its discretion in admitting it. As to the latter point, he argued that what probative worth the contempt order arguably had was far outweighed by the immense prejudicial effect of its findings that Mr. Frumusa had “converted” to the detriment of WHD the very money he was charged with stealing. This was particularly so, 2 http://nysdoccslookup.doccs ny.gov/GCA00P00/WIQ3/WINQ130 (last accessed May 15, 2016). 19 he contended, in light of how the prosecutor used the order at trial, urging the jurors on summation to follow Justice Fisher’s lead to hold Mr. Frumusa responsible. A narrow majority of the court rejected Mr. Frumusa’s contention: “The earlier order directed defendant's businesses to turn over all monies they had received as a result of defendant diverting credit card proceeds from Webster Hospitality Development LLC (WHD), a company in which defendant held majority ownership and which was in receivership, to undisclosed bank accounts maintained for defendant's businesses. Contrary to defendant's contention, the contempt order does not constitute a finding that defendant stole the money; rather, it demonstrates that defendant's businesses failed to abide by the earlier order to return money to WHD and to provide certain documentation to the receiver. We thus conclude that the contempt order was properly admitted as relevant evidence of defendant's intent to deprive WHD of the money by ‘withhold[ing] it or caus[ing] it to be withheld from [WHD] permanently’ (§ 155.00 [3]; see People v Molineux, 168 NY 264, 293 [1901]).” “Moreover, we note that ‘[l]arcenous intent . . . is rarely susceptible of proof by direct evidence, and must usually be inferred from the circumstances surrounding the defendant's actions’ (People v Brown, 107 AD3d 1145, 1146 [3d Dept 2013]). Here, the contempt order had significant probative value inasmuch as it showed that defendant's conduct did not merely constitute poor financial management but, rather, that defendant, through his businesses, intended to deprive WHD of the diverted money permanently. The court therefore properly concluded that ‘the probative value of the evidence outweighed its prejudicial effect’ (People v Smith, 129 AD3d 1549 [4th Dept 2015]).” (People v Frumusa, 134 AD3d 1503, 1504 [4th Dept 2015] [internal citations modified].) The majority memorandum did not address four key points: 20 First, the memorandum did not address that the contempt order contained just a judicial finding, as opposed to an evidentiary fact, that the Frumusa “businesses failed to abide by the earlier order to return money to WHD and to provide certain documentation to the receiver” and that the finding was made upon an uncontested civil proceeding where a lower standard of proof applied. Second, the court did not address the particular findings that the companies had “converted $249,196.28 of WHD's monies” and that such conduct was “calculated to and actually did defeat, impair, impede and prejudice the rights and remedies of WHD." Third, it failed to address the prosecutor’s trial strategy of conveying that though the contempt order identified the Frumusa’s companies as the subject of its findings, it was Mr. Frumusa who performed all the actions of the Frumusa companies and it was Mr. Frumusa himself who was the actual subject of the findings. Last, the court did not address the prosecutor’s summation remarks, in which the prosecutor urged the jury to hold Mr. Frumusa accountable as Justice Fisher had tried to do with his contempt order. Two justices dissented, opining that the contempt order’s admission resulted in a deprivation of the right to a fair trial. 21 First, the dissenting justices took issue with the majority’s conclusion that the contempt order constituted Molineux evidence: “The evidence here, however, was not ‘[p]roof of defendant's conviction of a subsequent unrelated crime’ (People v Holmes, 112 AD2d 739, 739 [4th Dept 1985]; see People v Ingram, 71 NY2d 474, 479-480 [1988]). Rather, it was evidence involving conduct of defendant, through his businesses, that was related to the same crime with which defendant was charged. Indeed, the contempt order arose from an order directing defendant's businesses to turn over the very funds that the People accused defendant of stealing. Moreover, the contempt order was issued in an uncontested civil proceeding, where the lesser burden of proof of clear and convincing evidence applied (see El-Dehdan v El-Dehdan, 26 NY3d 19, 29 [2015]).” (134 AD3d at 1506 [Centra and Lindley, JJ., dissenting] [internal citations modified]). Second, the justices concluded that even if the contempt order could be considered Molineux evidence, it was inadmissible nonetheless because its prejudicial effect, in the context of the case, far exceeded whatever probative worth it had. “Inasmuch as the contempt order stated that defendant, through his businesses, ‘converted’ the funds at issue to the detriment of the rights and remedies of WHD, the jury had before it a document that essentially constituted, in the context of the other evidence presented at trial, a judicial finding of defendant's larcenous intent. The prejudicial effect on the charge herein against defendant was nothing other than obvious and extreme. In addition, as noted above, the court did not give any limiting instruction to the jury to minimize any prejudicial effect.” “Moreover, the prosecutor concluded his summation by drawing the jury's attention to the contempt order, and the prosecutor urged the 22 jurors to convict inasmuch as a Supreme Court Justice ‘had tried [to hold him responsible] by trying to fine him and that didn't work.’ He further stated that Supreme Court had ‘issued order after order after order trying to hold him in contempt. Now you can issue that decision. You can hold him responsible for this, and you can find him guilty of Grand Larceny in the Second Degree.’ Thus, the prosecutor sought to have the jury use the contempt order for the very purpose which he had earlier said was not the purpose of the Molineux application, i.e., ‘to suggest that just because a judge found . . . defendant's [businesses] . . . in contempt of Court, that they should convict him.’ In our view, defendant was denied a fair trial by cumulative effect of the admission in evidence of the contempt order, the testimony regarding that contempt order, and the prosecutor's references to the contempt order on summation.” (Id. at 1507.) 23 ARGUMENT The Admission of the Criminal Contempt Order – Which Revealed Justice Fisher’s Finding That Mr. Frumusa Committed The Very Larceny He Was On Trial For – Was Highly Prejudicial As It Encroached Upon The Jury’s Province To Find Guilt, Independently, Free From Outside Influences. Yet All Of The Judicial Findings Contained In the Contempt Order Had No, Or Minimal, Probative Force. The court is the trial’s “gatekeeper” (GE v Joiner, 522 US 136, 147 [1997] [Breyer, J., concurring]). While it is given leeway to decide whether to admit competent evidence that has some relevance to the issues at hand, the court must keep from the jury evidence that has no probative value whatsoever (see e.g. People v Cook, 37 NY2d 591, 596 [1975]) or has just marginal probative worth and threatens to undermine the defendant’s right to a fair trial (see e.g. People v Resek, 3 NY3d 385, 387 [2004]). This is true whether the evidence sought to be introduced is Molineux evidence or not (see People v Vargas, 86 NY2d 215, 224 [1995]; People v De George, 73 NY2d 614 [1989]). The County Court failed in its role as gatekeeper when it admitted Justice Fisher’s contempt order, setting forth its findings that Mr. Frumusa’s companies had “converted” WHD funds and that such conduct was “calculated” to “prejudice” and “impair” the rights of WHD. The order’s potential for prejudice was, in the words of the dissenting justices of the Appellate Division, “nothing other than obvious and extreme” (Frumusa, 134 AD3d at 1507). In the context of 24 the People’s case, the contempt order showed that Justice Fisher had determined that Mr. Frumusa committed the very crime he was on trial for. Put before the jury, that determination had the decided tendency to influence the jury to surrender its fact-finding function – to seek to harmonize its result with Justice Fisher’s rather than to make its own, independent findings based solely upon the proper evidence before it. Yet the contempt order had no, or essentially no, probative worth: it revealed no evidentiary facts, just what a justice had personally concluded upon an uncontested civil contempt proceeding; it did not logically tend to prove the facts for which it was offered; and it was entirely unnecessary. The County Court’s ruling admitting the contempt order is an error of law requiring a new trial.3 1. The People Introduced the Contempt Order As Part of Strategy that Enabled Them to Urge the Jury to Hold Mr. Frumusa Accountable For Stealing The Credit Card Funds Just As Justice Fisher Tried To Do With His Contempt Order. The central question for the jury was whether Mr. Frumusa redirected the credit card payments into the NCB accounts between December 1, 2008 and June 15, 2009 only for WHD’s benefit – just to pay company bills – or whether he did so for personal gain. If Mr. Frumusa took control of the funds just to pay company bills, and not to benefit personally, the jury could reasonably find that Mr. Frumusa 3 Mr. Frumusa’s arguments that the contempt order had no relevance and, alternatively, that the County Court abused its discretion by admitting the contempt order because of the order’s potential for extreme prejudice are questions of law reviewable by this Court (see People v Cass, 18 NY3d 553, 560 n 3 [2012]). 25 did not wrongfully take, obtain, or withhold the funds or that Mr. Frumusa did not have a larcenous intent (see Penal Law § 155.05 [1]; Chesler, 50 NY2d at 207-210; Green, 5 NY3d at 542; Ricchiuti, 93 AD2d at 844). It was the People’s theory at trial that Mr. Frumusa showed a larcenous intent when he diverted the funds to the NCB accounts and did not return them despite a series of court orders, issued between February 9, 2009 and July 27, 2009, prohibiting Mr. Frumusa or his companies from accessing and retaining the funds. To prove this point, the People introduced all but one of the court orders, along with evidence that Mr. Frumusa directed the credit card payments into the NCB accounts and never paid the money back. The one order the People did not offer was the order dated July 27, 2009. The People instead offered a subsequent order of the Supreme Court, adjudging the Frumusa companies in contempt for disobeying the July 27th order. The civil contempt order, which the Supreme Court issued upon a motion that neither Mr. Frumusa nor his companies defended against, set forth Justice Fisher’s finding that the Frumusa companies disobeyed the July 27th order by failing to return WHD funds and to provide records of the NCB accounts. The contempt order also set forth a separate finding of Justice Fisher: that the Frumusa companies had “converted” the funds that Mr. Frumusa was on trial for stealing, an act that was 26 “calculated” to “defeat, impair, impede and prejudice the rights and remedies of WHD.” Over Mr. Frumusa’s objection, the County Court admitted the contempt order, which gave the prosecutor factual support for the remarks he made at the end of his summation that the jury should hold Mr. Frumusa responsible for stealing the credit card funds as Justice Fisher had tried to do with his contempt order (A 316). 2. The Contempt Order Posed Tremendous Prejudice. Rarely – if ever -- would evidence introduced at a criminal trial be as prejudicial as this contempt order was. In the context of the trial’s proof, the order revealed as clear as day that Justice Fisher found in a formal legal proceeding – and only after “due deliberation” – that Mr. Frumusa committed the precise crime he was on trial for. The order set forth Justice Fisher’s finding that companies Mr. Frumusa operated had “converted” WHD funds. This finding leaves no room for interpretation; it is a determination that the companies perpetrated a larcenous act (Penal Law § 155.05 [1]; Laverty v Snethen, 68 NY 522, 524 [1877] [“conversion” is an “unauthorized assumption and exercise of the right of ownership over goods belonging to another to the exclusion of the owner's rights”]). The order also set forth the justice’s finding that the larcenous act was “calculated” to “defeat, impair, 27 impede, and prejudice” WHD’s rights. This finding too is unambiguous; it is a determination that the WHD funds were taken, obtained, or withheld with an intent to steal (Penal Law § 155.00 [3], [4]; 155.05 [1]). Moreover, the trial’s proof established that the funds Mr. Frumusa was charged with stealing – the credit card payments – were the exact funds that the contempt order stated had been “converted” (A 115-117). Though the contempt order indicates that it was the Frumusa companies that were found to have “converted” the WHD funds, at trial there was no mistaking who the real subject of that finding was. The prosecutor executed a strategy of eliciting testimony and remarking at various points to establish that Mr. Frumusa carried out all the actions of his companies and that it was actually Mr. Frumusa personally whom Justice Fisher found to be contemptuous (A 159, 316). In a number of cases, this Court has recognized the substantial prejudice caused when a judge’s opinion about the defendant’s guilt is somehow conveyed to the jury, even when done so only impliedly or inadvertently (see e.g. People v Hommel, 41 NY2d 427 [1977]; People v Yut Wai Tom, 53 NY2d 44, 57-61 [1981]). Among those cases, People v Hommel is particularly instructive. In Hommel, a criminally negligent homicide case, the trial court instructed the jury on appellate decisions in other cases where the proof of criminal negligence was held to be legally sufficient. The circumstances of those cases 28 were “strikingly similar” to those of the defendant’s case. This Court found that the jury instruction was prejudicial error and required a new trial because of the appellate holdings’ potential effect of “invad[ing]” the jury’s “province as the sole arbiter of questions of fact” (41 NY2d at 429-430). This Court explained, “the potential impairment of the jury's freedom to evaluate the testimony before it free from outside influences cannot be denied. In its charge the trial court made reference to a set of facts strikingly similar to those before the jury in this case and clearly stated that the Appellate Division had held that they were ‘sufficient to support a finding . . . that the defendant acted with criminal negligence.' It cannot be gainsaid that because of this charge the jury might very well have felt compelled to reach a result in harmony with the conclusion apparently reached by the higher court in a previous case and that they may very well have been deprived of their freedom of action.” (41 NY2d at 430.) It does not take a degree in behavioral psychology to recognize the contempt order’s potential to intrude upon the jury’s “province as the sole arbiter of questions of fact” (41 NY2d at 429-430). It would have been the natural tendency of any juror to defer to the wisdom and expertise of a justice of the Supreme Court on the precise factual question presented, seeking to conform his or her result with the justice’s rather than decide the question independently and solely upon the evidence (41 NY2d at 430; People v De Jesus, 42 NY2d 519, 524 n 2 [1977] [“‘O wise young judge, how I do honour thee’ (Shakespeare, Merchant of Venice, act IV, scene 1)”]; see also Coleman Motor Co. v Chrysler Corp., 525 F2d 1338, 1351 [3d Cir 1975] [“admission of a prior verdict creates the possibility that the jury will 29 defer to the earlier result and thus will, effectively, decide a case on evidence not before it”]; Secada v Weinstein, 563 So 2d 172, 173-174 [Fla Dist Ct App 1990] [“information as to prior verdicts has the inevitable tendency of causing the jury in the present case to defer to decisions made in a previous one and thus to delegate the uniquely non-delegable duty of reaching its own independent conclusions”]). The prejudice from the contempt order’s admission, in the context of the People’s proof, was therefore manifest. But as bad as it was, the prosecutor managed to make it worse. Though the prosecutor in his Molineux application assured the court he would not use the order to suggest that “just because a judge found . . . defendant's [companies] . . . in contempt of Court, that [the jury] should convict him" (A 529), the prosecutor did, in fact, use the order for that purpose. The prosecutor finished his summation urging the jury to convict Mr. Frumusa – to “hold him responsible for this” -- because Justice Fisher “had tried” to hold Mr. Frumusa responsible “issu[ing] order after order after order trying to hold him in contempt” and “trying to fine him and that didn't work." (A 316.) The court gave no instruction that might temper the prejudice inherent to the order itself or the compounding prejudice of the prosecutor’s remarks (cf. People v Giles, 11 NY3d 495 [2008]). The court did not, for instance, instruct the jury that its fact-finding authority was not delegable and that it must not defer to Justice 30 Fisher’s findings or in any other way relinquish its authority to find facts based exclusively on the evidence before it. Defense counsel did not object to the prosecutor’s improper summation remarks or the court’s failure to give an instruction limiting the jury’s consideration of the contempt order. Therefore, neither the prosecutor’s remarks nor the court’s failure to so charge are raised as independent grounds for reversal. That is not to say, however, that this Court should ignore the improper remarks or the absence of a limiting instruction in assessing the contempt order’s prejudice, as both the remarks and the need for a limiting instruction are the obvious consequence of the erroneous ruling (see People v Resek, 3 NY3d 385, 392-393 [Court considered the inadequacy of the unobjected-to limiting instruction in its analysis of the prejudice of uncharged crime evidence]). Thus, the danger of the contempt order impairing “the jury's freedom to evaluate the testimony before it free from outside influences” was very real, and, consequently, the prejudice the contempt order posed was nothing short of extreme. 3. The Contempt Order Had No, or Virtually No, Probative Worth on any of the Trial’s Material Issues. In offering the contempt order, the People argued that it demonstrated that Mr. Frumusa had the required knowledge and larcenous intent when he took and maintained control of the credit card payments (see Penal Law § 155.05 [1]; 31 People v Green, 5 NY3d at 542). They contended that the contempt order showed that Mr. Frumusa had been informed -- by the contempt order itself or the July 27th order and the contempt motion it refers to -- that a court order prohibited him from accessing or retaining the money. Their logic was that since Mr. Frumusa redirected and kept the funds while being on notice that to do so was “wrong,” he must have acted with a larcenous intent. The People summed up their contention as follows: “not only was [Mr. Frumusa] not allowed to [take and maintain control of the money], he was ultimately held in contempt for doing that” (A 529-530). The Appellate Division held that the contempt order had sufficient probative force because it “demonstrates that defendant's businesses failed to abide by the earlier [July 27, 2009] order to return money to WHD and to provide certain documentation to the receiver” (134 AD3d at 1504) This, the court concluded, tended to prove that Mr. Frumusa intended to deprive WHD of the credit card payments by withholding them or causing them to be withheld permanently (134 AD3d at 1504; see Penal Law § 155.00 [3]). Both the People and the Appellate Division are wrong. a. The contempt order revealed only a judge’s personal conclusion that Mr. Frumusa’s companies did not abide by the July 27, 2009 court order requiring the companies to return WHD money or to turn over certain documentation, conclusions that the justice made at a civil contempt proceeding where Mr. Frumusa did not put up a defense. 32 The contempt order did not show that Mr. Frumusa or his companies failed to abide by the July 27, 2009 order to return the WHD money or furnish documentation to the receiver. Rather, it showed only that Justice Fisher determined that to be so. It other words, the contempt order revealed no evidentiary fact, only Justice Fisher’s personal conclusion that Mr. Frumusa did not comply with the July 27, 2009 order, which he based solely upon information he was provided through a civil contempt motion. Such a personal conclusion is “worth nothing” in resolving questions of fact (cf. People v Bouton, 50 NY2d 130, 136 [1980]) and has no relevance in a criminal trial (see generally Guarnier v Am. Dredging Co., 145 AD2d 341, 342 [1st Dept 1988]; see also Schultz v Thomas, 832 F2d 108, 111 [7th Cir 1987] [findings of a judge in another proceeding were irrelevant to the adjudication of a civil rights claim as the judge was “not a witness to the events in question and therefore could not properly comment on what transpired”]; Anderson v Genuine Parts Co., 128 F3d 1267, 1272 [8th Cir 1997] [“a jury verdict does not constitute evidence”; “a jury's verdict simply represents findings of fact, based on the evidence presented to it”]; People v Medina, 185 Colo 101, 109, 521 P2d 1257, 1261 [1974] [in a criminal trial where sanity was at issue, testimony that another jury had found the defendant sane was irrelevant]). Worse yet, Justice Fisher made his personal conclusion upon a civil contempt hearing where no defense was presented and a standard of only clear and 33 convincing evidence applied (see El-Dehdan v El-Dehdan, 26 NY3d 19, 29 [2015]), raising serious questions about whether jurors in a criminal trial would come to the same conclusion based upon competent, contested proof. b. The contempt order was not relevant to whether Mr. Frumusa knew he was not allowed to access or retain the credit card funds during the time period alleged in the indictment. The contempt and July 27th orders were not issued, and the motion for contempt was not made, until after the alleged larcenous acts occurred, between December 1, 2008 and June 15, 2009. So, to the extent that those filings informed Mr. Frumusa it was “wrong” to access or retain the money, they did so only after the alleged larcenous acts were committed. It was not relevant, however, that Mr. Fumusa came to learn it was “wrong” to direct the credit card payments into the NCB counts and to keep them there sometime after the alleged larcenous acts occurred. To be guilty of the charged larceny, Mr. Frumusa must have had a larcenous intent at the time of the alleged acts. Put another way, the actus reus and mens rea had to coincide (People v Gaines, 74 NY2d 358 [1989]; People v Salcedo, 92 NY2d 1019, 1022 [1998] [a “subsequently formed intent” results in the commission of a second offense]). c. The contempt order was not necessary to show that Mr. Frumusa or his companies disobeyed a court order to pay back the credit card funds (and thus intended to withhold it permanently). 34 Necessity is an “important factor” in determining evidence’s probative value (People v Ventimiglia, 52 NY2d 350, 360 [1981]). Cumulative evidence tends to lack probative worth (see Ventimiglia, 52 NY2d at 360; People v Vargas, 88 NY2d 856 [1996]; People v Alvino, 71 NY2d 233, 242-243 [1987].) For example, in Vargas, where the defendant was accused of committing a forceful rape and proposed a consent defense, this Court held that evidence of uncharged sex offenses against others was not admissible to prove intent, as intent was easily inferable from the alleged violent encounter, making the uncharged sex crime evidence unnecessary and thus lacking of probative worth. The People did not need to introduce the contempt order to prove that Mr. Frumusa or his companies disobeyed a court order by not returning company money or not providing the receiver with NCB account records. Nor did they need to offer the order to show that Mr. Frumusa knew that diverting the funds into the NCB accounts violated court order, and, in that sense, was “wrong.” Other, non- prejudicial evidence “conclusively established” these facts (see People v Allweiss, 48 NY2d 40, 47 [1979]). It was not disputed at trial that Justice Fisher issued several orders before July 27, 2009 that together prohibited Mr. Frumusa and his companies from accessing and retaining company funds. It was also not contested that Mr. Frumusa and his companies did not comply with those orders: undisputed evidence showed that Mr. Frumusa directed the funds into the NCB accounts and 35 never returned the funds and that he failed to provide the receiver with the NCB account records (A 115, 117, 156, 159, 497-516 [People’s Exhibits 13-17]) It added nothing that Justice Fisher issued yet another such order, dated July 27, 2009, and that Mr. Frumusa’s conduct in the same way violated that order as well. But even assuming that it did, the People still did not need to offer the contempt order. The People could have made that particular point, and altogether avoided the prejudice of the contempt order, by introducing the July 27th order itself (see People v Resek, 3 NY3d at 390 [uncharged crime evidence should not have been admitted to “complete the narrative” because “there was no ambiguity that could not have been easily dealt with by far less prejudicial means”]). d. Nothing concerning Mr. Frumusa’s intended use of the WHD funds can be inferred from the fact that he did not return the money as directed by the July 27, 2009 order, as the evidence at trial raised doubts about his ability to pay the money back. Evidence has probative worth only if “it tends logically and by reasonable inference to prove the issue upon which it is offered” (People v Ventimiglia, 52 NY2d 350, 360 [1981]). That Mr. Frumusa did not return the credit card funds as directed by the July 27th order is too ambiguous to have such a tendency (see e.g. People v Pavone, 26 NY3d 629, 641 [2015] [silence is ambiguous and thus lacks probative worth]; People v Basora, 75 NY2d 992 [1990] [as a smile may reflect many different states of mind, it is ambiguous and has minimal probative value as evidence of consciousness of guilt]). The trial evidence raised substantial doubt 36 about Mr. Frumusa’s and his companies’ ability to comply with the July 27th order to repay the funds. The People’s own proof showed that Mr. Frumusa had filed for personal bankruptcy in June of 2009 (A 115), thus preventing him personally from making reimbursements (11 USCS § 362 [a] [automatic stay of actions to recover money once bankruptcy petition is filed]; 11 USCS § 541 [a] and 28 USCS § 1334 [e] [generally, bankruptcy petitioner’s property becomes the exclusive jurisdiction of the bankruptcy court]). And by the end of July 2009, Mr. Frumusa’s other companies were all suffering financially (A 216-217) and had minimal cash on hand (see A 675-677 [People’s Exhibit 5] [Webster Hospitality Development National City Bank account, July beginning balance of -299.87 and ending balance of -572.94, August beginning balance of -572. 94 and ending balance of 0.00]; A 719, 727 [People’s Exhibit 6] [Frumusa Enterprises National City Bank account, July beginning balance of 867.07 and ending balance of -16,000.56, August beginning balance of -16,000.56 and ending balance of -16,915.91]; 747-749 [People’s Exhibit 7] [Scenic Village Apartment Homes National City Bank account, July beginning balance of -55.93 and ending balance of 16,913.96 and August beginning of 16,913.96 and ending balance of 1,038.05]). As it may very well have been impossible for Mr. Frumusa or his companies to have returned the funds as directed by the July 27th order, the fact that Mr. Frumusa or his companied did not do so in response to the order does “not logically and by reasonable 37 inference” tend to prove a larcenous design (Ventimiglia, 52 NY2d at 260; People v Gonzalez, 68 NY2d 424, 428 [1986] [nothing can be logically inferred from the failure to act when the act is impossible to carry out]; see also Till v SCS Credit Corp., 541 US 465, 493 [2004] [blood cannot be drawn from a stone]). e. Nothing relevant can be inferred from the fact that Mr. Frumusa did not oppose the motion to hold his companies in contempt. The People noted in their Molineux application that the contempt order reveals that Mr. Frumusa did not oppose the contempt motion, in either person or papers (A 530). Should the People now contend that Mr. Frumusa’s silence in the face of the contempt motion was relevant as a tacit admission to the motion’s allegations, this Court should reject that argument as well. Mr. Frumusa’s silence is too ambiguous to reflect a consciousness of guilt (see People v De George, 73 NY2d 614 [1989]). There are various reasons consistent with innocence why Mr. Frumusa would not have opposed the contempt motion. For one thing, Mr. Frumusa may have wished to exercise his constitutional right to remain silent (see Murphy v Waterfront Comm'n of NY Harbor, 378 US 52, 94 [1964] [“The (Fifth Amendment) privilege can be claimed in any proceeding, be it criminal or civil, administrative or judicial, investigatory or adjudicatory”]). For another, he may not have had the money to hire a lawyer to put forth a defense to the motion. 4. The Contempt Order’s Admission was Not Harmless. 38 The contempt order posed immense prejudice, particularly in light of how it was used, for it invaded upon the jury’s province to decide, independently and solely upon the properly-admitted evidence before it, whether Mr. Frumusa committed the charged theft. And it lacked probative force because it revealed no evidentiary facts (just a personal conclusion of a justice), did not logically tend to prove any material issue, and was not necessary. The County Court therefore erred as a matter of law in ruling the order admissible. This error requires a new trial because it cannot be dismissed as harmless. As the potential prejudice resulting from the order -- the usurpation of the jury’s fact-finding authority -- denied Mr. Frumusa his right to a fair trial, the error cannot be written off as harmless, regardless of the strength of the People’s case (People v De Jesus, 42 NY2d 519, 524 [1977]; Hommel, 41 NY2d at 430). But even if the prejudice did not rise to the level of depriving Mr. Frumusa of a fair trial, he is still entitled to a reversal because the evidence of Mr. Frumusa’s guilt was not overwhelming or at least not so strong as to rule out a significant probability that the jury would have acquitted but for the error (People v Crimmins, 36 NY2d 230, 241-242 [1975]). Mr. Frumusa pressed at trial that he did not “take,” “obtain,” or “withhold” WHD money, or do so with a larcenous intent, when he directed the credit card funds into the NCB accounts, held them there, and then used them. In particular, 39 he maintained that he, fearing that WHD might be mismanaged under receivership, directed the funds into the NCB accounts so that he could use them to pay the company’s bills, using the money only for the company’s benefit and causing the company no loss whatsoever. While Mr. Frumusa’s use of the money for that purpose may have violated court order, and was thus contemptuous, it was not a theft, he argued. The trial proof gave much support for this contention. The evidence showed that Mr. Frumusa was WHD’s managing member and held a seventy-five percent interest in the company (A 103, 141). There was no dispute that his position as managing member gave him the responsibility of paying the company’s bills (A 196). The evidence showed that Mr. Frumusa often carried out this responsibility by using outside accounts (A 165-167 [payment of tax bill in March of 2009, during period of indictment], 219-220 [WHD bills and expenditures paid through a Frumusa Enterprises account]). The evidence also showed that Frumusa Enterprises, where some of the credit card payments were directed, had billed WHD for services it provided (A 124, 177). While the People introduced NCB bank statements attempting to prove that Mr. Frumusa used the credit card funds for his own benefit, the People never traced the funds to what were known to be personal purchases. Once directed into the accounts, the credit card funds were comingled with hundreds of thousands of 40 dollars from other sources (A 254, 258). Several large transfers from the accounts were made to unidentified payees, who were not ruled out as WHD creditors or service providers (A 79, 274-276). And though the statements showed Mr. Frumusa made payments from the accounts for various goods and services, there was no testimony proving that the goods and services were not for WHD (A 690, 694-696, 698-702, 705-610, 713-718, 721-723, 728, 742, 744, 750-751 [People’s Exhibits 6, 7, 8]). Thus, the admission of the contempt order cannot be disregarded as harmless error, and a new trial is required. - , f I I I l I I I . ' I I CONCLUSION The Appellate Division order should be reversed, and a new trial should be ordered. Dated: May 16, 2016 Respectfully submitted, TDMOTHYP.DONAHER Monro'e County Public Defender ~mey for Appellant ~10-) ~. QA &~ . 41 BY: DREW R. DuBRIN Special Assistant Public Defender 10 N. Fitzhugh Street Rochester, New York 14614 (585) 753-4947