Shapiro, Arato & Isserles Wins Second Circuit Appeal Overturning Accounting Fraud Conviction
On July 1, 2010, in a unanimous ruling, the United States Court of Appeals for the Second Circuit vacated the conviction of the former Chief Marketing Officer of U.S. Foodservice and granted a new trial. Our client, Mark P. Kaiser, had been convicted in the U.S. District Court for the Southern District of New York on charges of securities fraud related to the alleged inflation of earnings.
The Court held that a new trial was required because of the “conscious avoidance” instruction was legally erroneous, and because of the improper admission of hearsay evidence. The Court held that there was a reasonable probability that the jury convicted Mr. Kaiser based on the flawed conscious avoidance instruction and would not have done so but for the instructional error. This error, the Court concluded, seriously affected the fairness of the trial. Additionally, the Court concluded that the District Court erred in admitting “highly prejudicial” hearsay evidence by one of the government’s cooperating witnesses, which provided an independent basis for vacating the conviction and granting a new trial.
Shapiro, Arato was lead counsel for Mr. Kaiser on appeal. Alexandra A.E. Shapiro argued the appeal.
To read the Second Circuit’s opinion, click here.