Case 1:08-cr-00366-JSR Document 76 Filed 01/08/09 Page 1 of 8
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`UNITED STATES DISTRICT COURT
`SOUTHERN DISTRICT OF NEW YORK
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`UNITED STATES OF AMERICA,
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` OPINION
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`08 Cr. 0366 (RLC)
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`v.
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`JAMES J. TREACY,
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`Defendant.
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`APPEARANCES
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`Deirdre Ann McEvoy, Esq.
`United States Attorney’s Office
`Southern District of New York
`1 St. Andrews Plaza
`New York, NY 10007
`Assistant United States Attorney
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`Joshua Aaron Goldberg, Esq.
`United States Attorney’s Office
`Southern District of New York
`1 St. Andrews Plaza
`New York, NY 10007
`Assistant United States Attorney
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`David Matthew Fragale, Esq.
`Steptoe & Johnson LLP (DC)
`1330 Connecticut Avenue, N.W.
`Washington, DC 20036
`Attorney for the Defendant
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`Evan T. Barr, Esq.
`Steptoe & Johnson, LLP
`750 Seventh Avenue
`Suite 1900
`New York, NY 10019
`Attorney for the Defendant
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`Case 1:08-cr-00366-JSR Document 76 Filed 01/08/09 Page 2 of 8
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`Sandra Elaine Cavazos, Esq.
`Steptoe & Johnson, LLP
`750 Seventh Avenue
`Suite 1900
`New York, NY 10019
`Attorney for the Defendant
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`ROBERT L. CARTER, District Judge
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`Case 1:08-cr-00366-JSR Document 76 Filed 01/08/09 Page 3 of 8
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`INTRODUCTION
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`The government moves for reconsideration of the court’s November 19, 2008, Opinion
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`(“Opinion”) dismissing Count Two of the Indictment based on the statute of limitations. The
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`motion for reconsideration is granted, and the claim set forth in Count Two is reinstated.
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`Furthermore, in light of the decision to reinstate Count Two, the court addresses
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`Defendant’s June 30, 2008, Motion to Compel the Government to Elect Between Count One and
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`Count Two Because of Multiplicity. Defendant’s motion is denied.
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`BACKGROUND
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`The background of this case has been documented in detail and familiarity is assumed. It
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`is sufficient to note that the Opinion granted Defendant James J. Treacy’s motion to dismiss
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`Count Two of the of the Indictment for failure to allege any facts in support of a securities fraud
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`claim occurring within the limitations period; and chose not to reach Treacy’s motion to compel
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`the government to elect between counts One and Two because of multiplicity.
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`DISCUSSION
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`A.
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`Government’s motion to reconsider the limitations period is granted. Treacy’s
`motion to dismiss Count Two in its entirety as time-barred is denied.
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`The government does not specify the authority pursuant to which it moves for
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`reconsideration. Local Rule 6.3 of the Southern and Eastern districts generally controls such
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`motions. In order to succeed the government must present “matters or controlling decisions the
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`court overlooked that might materially have influenced its earlier decision.” Morser v. AT&T
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`Info. Sys., 715 F.Supp. 516, 517 (S.D.N.Y. 1989) (Sweet, J.). Local Rule 6.3 “is to be narrowly
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`construed and strictly applied so as to avoid repetitive arguments on issues that have been
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`3
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`Case 1:08-cr-00366-JSR Document 76 Filed 01/08/09 Page 4 of 8
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`considered fully by the court.” Ades v. Deloitte & Touche, 843 F.Supp. 888, 892 (S.D.N.Y.
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`1994) (Sweet, J.). “The decision to grant or deny a motion for reargument is within the sound
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`discretion of the [court].” Schaffer v. Soros, No. 92 Civ. 1233 (LMM), 1994 WL 592891, at *1
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`(S.D.N.Y. Oct. 31, 1994) (McKenna, J.). Generally, the court will grant a motion for
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`reconsideration in three circumstances: (1) an intervening change in the controlling law; (2) new
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`evidence becomes available; or (3) where the court must correct clear error or prevent manifest
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`injustice. Virgin Atl. Airways, Ltd. v. Nat’l Mediation Bd., 956 F.2d 1245, 1255 (2d Cir. 1992).
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`A motion for reconsideration is not a vehicle for litigants to make repetitive arguments that the
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`court has already considered and it cannot be used to fill in the gaps of a losing argument. Range
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`Road Music, Inc. v. Music Sales Corp., 90 F.Supp.2d 390, 391-92 (S.D.N.Y. 2000) (Sprizzo, J.).
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`The government argues that the court must correct clear error regarding the limitations
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`period. It argues that the opinion miscalculates the limitations period by failing to consider
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`tolling agreements entered into by the Parties, agreements that excluded 11 months from the
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`tolling period. Therefore, the government contends, rather than using April 24, 2003, as the
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`operative date for limitations purposes, the court should have used May 24, 2002. Treacy agrees
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`with the government’s position.
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`The motion to reconsider the limitations period is granted. Upon reconsideration, the
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`court finds that it incorrectly calculated the statute of limitations in this case by failing to account
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`for the agreements that tolled the statute of limitations for 11 months causing the statutory period
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`to begin to run on May 24, 2002, not April 24, 2003. Accordingly, the court reconsiders its
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`ruling that Count Two of the Indictment must be dismissed in its entirety because it is untimely.
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`Treacy moved to dismiss Count Two of the Indictment alleging violations of Section
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`4
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`Case 1:08-cr-00366-JSR Document 76 Filed 01/08/09 Page 5 of 8
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`10(b) of the Securities Exchange Act of 1934, 15 U.S.C. § 78j(b), and Securities and Exchange
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`Commission Rule 10b-5, 17 C.F.R. § 240.10b-5, for failure to allege any facts in support of a
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`securities fraud that occurred within the applicable period. “[T]o the extent that [the
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`government’s] claims are based directly on a backdated grant of options, the [limitations] period
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`begins to run on the date the options were granted.” In re Comverse Tech., Inc. Sec. Litig., 543
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`F.Supp.2d 134, 155 (E.D.N.Y. 2008) (citing In re Atmel Corp. Derivatives Litig., No. C 06-4592
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`JF (HRL), 2007 WL 2070299, at *7 (N.D.Cal. July 16, 2007)). The Indictment alleges that
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`Treacy and others approved options grants in June 2002. Treacy argues that the allegation based
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`on the June 2002 grant is untimely even in light of the May 24, 2002, cut-off. He contends that
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`the Superseding Indictment, filed on July 10, 2008, did not relate back to the April 24, 2008,
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`Underlying Indictment since the latter was not validly pending, and therefore the June 2002 falls
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`beyond the limitations period.
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` The court preserves its determination that the filing of the Underlying Indictment tolled
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`the limitations period, and the Superseding Indictment related back to the date of the Underlying
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`Indictment. It is generally the case that the filing of a valid indictment tolls the limitations period
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`for the charges contained in that indictment, see United States v. Grady, 544 F.2d 598, 601 (2d
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`Cir. 1976), and a superseding indictment will relate back to the date of the original indictment if
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`the superseding indictment does not “broaden or substantially amend the original charges,”
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`United States v. Gengo, 808 F.2d 1, 3 (2d Cir. 1986). However, “[n]o single factor is
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`determinative; rather, the ‘touchstone’ of our analysis is notice, i.e., whether the original
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`indictment fairly alerted the defendant to the subsequent charges against him and the time period
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`at issue.” United States v. Salmonese, 352 F.3d 608, 622-24 (2d Cir. 2003). The Underlying
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`Case 1:08-cr-00366-JSR Document 76 Filed 01/08/09 Page 6 of 8
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`Indictment served clear notice on Treacy that the government intended to prove that he
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`committed securities fraud; he was informed “in no uncertain terms that he would have to
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`account for essentially the same conduct with which he was ultimately charged” in the
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`Superseding Indictment. United States v. O’Bryant, 998 F.2d 21, 24 (1st Cir. 1993).
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`Count Two of the Indictment has successfully alleged facts within the applicable
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`limitations period in support of a securities fraud claim. The court’s November 19, 2008, ruling
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`dismissing Count Two is vacated, and Treacy’s motion to dismiss Count Two as time-barred is
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`denied.
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`B.
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`Treacy’s motion to compel the government to elect between Count One and Count
`Two because of multiplicity is denied.
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`Treacy moved to compel the government to elect between counts One and Two of the
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`Indictment because of multiplicity. The court found it unnecessary to reach the issue in the
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`Opinion, but is required to do so now, having reinstated Count Two.
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`“An indictment is multiplicitous when it charges a single offense as an offense multiple
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`times, in separate counts, when, in law and fact, only one crime has been committed. United
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`States v. Chacko, 169 F.3d 140, 145 (2d Cir. 1999) (citing United States v. Holmes, 44 F.3d
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`1150, 1153-54 (2d Cir.1995)). This violates the Fifth Amendment’s prohibition against
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`subjecting a person to punishment for the same crime more than once. Id. Treacy, argues that
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`the government does not allege any timely misstatement or omission that would allow it to
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`proceed under a misrepresentation theory. Therefore, Treacy contends, the government proffers a
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`pure “scheme” theory that does not differ materially from the conspiracy charge.
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`Treacy’s motion is premature. “Where there has been no prior conviction or acquittal, the
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`Double Jeopardy Clause does not protect against simultaneous prosecutions for the same offense,
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`Case 1:08-cr-00366-JSR Document 76 Filed 01/08/09 Page 7 of 8
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`so long as no more than one punishment is eventually imposed.” United States v. Josephberg,
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`459 F.3d 350, 355 (2d Cir. 2006). The court will dismiss any multiplicitous counts if Treacy is
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`convicted on multiplicitous counts. See id. (“If the jury convicts on more than one multiplicitous
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`count, the defendant’s right not to suffer multiple punishments for the same offense will be
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`protected by having the court enter judgment on only one of the multiplicitous counts.”) (citing
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`Ball v. United States, 470 U.S. 856, 865 (1985)). “It is well established that ‘[w]hether to
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`prosecute and what charge to file or bring before a grand jury are decisions that generally rest in
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`the prosecutor’s discretion,’ and ‘a defendant has no constitutional right to elect which of two
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`applicable federal statutes shall be the basis of his indictment and prosecution . . . .’” Id. (quoting
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`United States v. Batchelder, 442 U.S. 114, 124 (1979)) (brackets in the original). Treacy’s
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`motion to compel the government to elect between Count One and Count Two because of
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`multiplicity is denied.
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`Case 1:08-cr-00366-JSR Document 76 Filed 01/08/09 Page 8 of 8
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`Case 1:O8—cr—OO366—JSR Document 76 Filed 01/08/09 Page 8 of 8
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`CONCLUSION
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`For the foregoing reasons, the goVemment’s motion for reconsideration is granted. Upon
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`reconsideration the Court holds that the government has successfully alleged facts within the
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`applicable limitations period to support a securities fraud claim. The claim set forth in Count
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`Two is reinstated.
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`Futherrnore, for the foregoing reasons, Treacy’s motion to compel the government to
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`elect between counts One and Two because of multiplicity is denied.
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`IT IS SO ORDERED
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`DATED:
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`New York, New York
`January 8, 2009
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`b